Did the title of this column get your attention? I hope so…and an explanation of that quote is forthcoming. This savvy quote was a take-away from one of the excellent seminars presented at Surfaces in February: Going Beyond Residential-- Expanding Into the Commercial Market, by Dave Stafford of Dave Stafford Associates.
As we all await consumer confidence to show some fledgling signs of recovery, perhaps you have already tested the waters of the commercial market. If so, then you’ve discovered for yourself that it’s a very different animal from residential. The possible pitfalls in commercial work are plentiful and costly.
Here are four directives to follow when entering the commercial segment.
Network.This is absolutely essential. Local professional organizations are a great way to meet your fellow businesspeople. Don’t overlook your local Chamber of Commerce as a vehicle for introductions. Host a meeting for your area Facility Managers Association. Talk to architects and design specifiers, where it all begins. Any headway you can make at that level is invaluable. And building relationships with one or two good general contractors in your community should at least give you the opportunity to bid upcoming jobs.
Differentiate your company.Find a way to stand out from the pack. Offer unique products and services, look for specialty products that very few people have. Set yourself apart by talking about your company’s warranty policies on products. Then take it a step further-repackage yourself to market your Green products! Nearly half (47%) of surveyed U.S. builders believe that green building will increase sales significantly. The commercial market is extremely in sync with green building practices, so focus on that to get their attention.
Choose areas of specialty.Pick one or two specializations outside your usual scope of business and get some training in that market segment. Do not differentiate in too many new directions. Otherwise you will dilute your resources and spread yourself too thin--a formula for disaster.
Assemble the right team.You need self-motivators with no fear. They are venturing into new areas of doing business and must be willing to learn and grow. Do they have good people skills? Are they willing to undergo some intense training to prepare for forging into the commercial market? If you have the right team in place, keep them motivated and pay attention to morale.
Once you’ve laid the groundwork to earn your way into the commercial market, you are now ready to be awarded the job. According to Nick Mazzo, Sr., Premier Flooring Systems of Bethel, Conn. president, “this is the time to look over the contract carefully. Know the scope of work. Incorporate ‘change order’ terms into your original proposal to be sure your costs are covered.
“Do nothing until your original proposal is signed. Don’t spend a dime if it ain’t signed.” If there are changes to be made outside of the original scope of work, don’t tell them no, just tell them how much. Watch out for insertions in the contract that read, “Pay if paid.” That means if the GC doesn’t get paid for any reason by the owner/developer, then he doesn’t have to pay you. You have the option to cross out and initial that part of the contract before you sign anything.
Mazzo also suggests that you be in constant touch with the facility manager, especially if this is a large job. Try to install the project in stages so you can meet deadlines. If you do the job efficiently, you will put your company in a position where the GC will come to you for future work.
Green Products Should be Building Blocks of Your Commercial LibraryGreen is not a gimmick or ‘brand name’ that is overlaid on a project at the end of the design process. It must be integrated into each project at the beginning, to make sustainability part of a building’s DNA, according to Jim Kelly, vice president of LPA Architects, Roseville, Calif.
Choose your vendors carefully and study their processes and products. I did some research on this subject for my company, and here are just a few green sources that really caught my attention (Chart A). Keep in mind this is just a brief selection of Green products out there, but if it piques your interest, perhaps you will undertake your own research and complete a personal go-to list.
Again, this list is just a highlight of noteworthy products. There are so many outstanding green floor coverings. On the residential side, be sure to find out more from your local reps about their sustainable products. Shaw’s Anso nylon is a crossover from residential to commercial and is 100% cradle-to-cradle recyclable. Mohawk’s SmartStrand with DuPont’s Sorona polymer is a corn-sugar-based product and highly sustainable, but at this time, the brand is offered only in residential carpets.
Wool is totally sustainable and a good choice for your green customers as well. Don’t forget that the green story extends to recycled carpet backings and carpet cushion. Ask the right questions of your reps, and you will have a new and powerful story to tell about how the products you carry are helping the environment.
All of the industry experts agree on one thing: this recession will not only end, but will have created a pent-up demand for your goods and services. The first year of a post-recession upturn historically nets double-digit profits! Your job right now is to survive so you will be around for a bigger piece of the pie.
Commercial work may just be the vehicle to see you through the next year or so. Once you’ve earned your way into commercial, you may wisely decide to keep a mix of residential to commercial, even after we’ve left this ugly economic correction behind. Safeguard the commercial eggs you choose to keep in your business basket. They were hard earned and might just be the leverage you need against future residential downturns.