Know Your Close Rates
As a contractor, your closing ratio is a valuable tool in evaluating whether or not your existing operations have room for improvement. There are typically two close rates for contractors to focus on: the close rate for general sales leads and the close rates for estimated jobs. In this blog, we’ll give you some ideas about how to increase both types of closing ratios so that you can meet your sales goals and improve your bottom line.
Defining Closing Ratio
A closing ratio, or close rate, is a metric that measures sales effectiveness. It determines the number of deals closed compared to the bids you quote. So, if you bid on 100 projects last year and closed 25 contracts, your close rate was 25% (25 /100 * 100 = 25). Now, let’s get that number up!
Improve Your Lead Response Time
A quick response time is essential for the best chance of closing a lead, and will differentiate you from your competitors. It also lets potential clients know that your company has a customer-first approach and that you won’t let them fall through the cracks when working with them.
According to a study in Harvard Business Review, companies that responded to a potential customer within an hour of receiving their query were 60 times as likely to qualify the lead than companies that waited 24 hours or longer. Therefore, aim to respond to questions within an hour for the best chance of turning leads into sales.
Build a Relationship with Potential Clients
Don’t just follow up with queries and leave it at that; persistence wins the race. Instead, get to know your prospects and build a relationship with them in order to build trust. According to Business Insider, a potential client must know and trust you and your service before deciding to work with you.
Whether you build relationships with prospects through email, phone, or in person, ensure your encounters are personalized. Take note of any information the prospect gives you and of previous conversations you’ve had so that you can tailor your future conversation to them.
Ask For Referrals
Asking a happy client to refer your business to another company is a valuable sales lead. Referrals are low-hanging fruit with a higher closing ratio than other leads. Referral requests don’t need to wait until a project is complete; consider asking as you begin working together when the relationship is fresh and new.
Referral requests can be typed on the bottom of invoices and emails, or you can ask your best clients directly. Always remember to thank your client when they send a referral your way.
Win More Business with SmartBuild
With SmartBuild Systems’ automated software, you can typically increase the deal close rate by 50% and cut bid time to about 20 minutes! This way, both contractors and suppliers win more business and increase sales. Additionally, SmartBuild automation eliminates takeoff errors, decreases business costs, and engages prospective clients with live design sessions and on-the-spot proposals.
With SmartBuild Systems you will be able to:
- Design a post-frame building on your laptop in real time with your client
- Automatically frame a custom structure
- Update a 3D model with a menu-driven set of prompts
- Build a cut list for sheathing and trim
- Create material lists and update pricing automatically
- Deliver an onsite proposal before you leave the meeting
SmartBuild automatically populates the sales contract, creates a building description, and emails copies to your customers.
Roofing Passport, SmartBuild’s roof construction design software, is the industry’s only fully automated roofing software for estimating and ordering that puts the contractor in command of the bidding process.
Get in touch with SmartBuild Systems today to learn how the construction industry’s only complete design system can increase your closing ratio.
