Be competitive by picking products that allow you to get the job and maximize your profit. Do not be a complacent bidder of commercial opportunities where others specify the critical products. When you specify a product or help with a commercial specification, you dramatically increase your chances of winning the job.
Decide what your commercial niche will be and promote it. If you’re a market leader in selling and installing carpet or resilient products, then find out how to promote this strength with your Main Street commercial business. Look for ancillary products that will give you a complete package to present to potential clients such as ceramic, laminate, linoleum, rubber flooring, stair treads, and other specialty flooring.
Whether you are actively pursuing leads for property management tenant replacement work, healthcare, local government, general contractor bids, or a doctor’s office, you must always be aware of the chance to push your own product mix where you have an advantage. If you are frequently bidding on products that others have specified, then your chances of landing the job and making an above average profit are limited.
So, let’s say you have a lead and have picked up the blueprints and the specification book on a tenant replacement project. You eagerly turn to the finish schedule. There you find your worst nightmare: The specified flooring is from NorthStar Mills (a fictitious name), noted for its high prices, restrictive distribution, and general unwillingness to work with you. So, what do you do?
The easy answer is to just decline to bid on this particular project. However, if you wish to pursue the project, you should consider selling the value of an alternate product as a way to tilt things in your favor. First, do a careful review of the blueprints, determine overall scope, become familiar with the particular NorthStar Mills product; how it fits in with the entire finish schedule, and see if an “or equal” or alternate is already specified. You may just find the architect is one step ahead of you and is willing to take another product to make sure maximum value is received.
If this is not the case given the scope of the job, is it really worthwhile to pursue the project? Do you have the type of relationship with the buyer, owner, or general contractor where you might have a slight edge and will get some extra consideration? Do you know the architect or interior designer? Have you done work for the owner or client before? Is the flooring specification particularly vulnerable? Are there other products that figure prominently into the job that might offset any disadvantage one might have with NorthStar Mills product? Given the location of the job and its duration, time of year for performance, or market segment, is there a reason this job is especially desirable for your company?
If the answer is “yes”, then here are some things to do prior to any selling the value attempts: Find out if NorthStar and their mill rep might be willing to partner with you on this project. Perhaps their best local dealer has credit problems or they might be looking for another dealer alliance. Determine who specified the job, their reputation for holding or changing a specification. If this is a job connected to federal, state, or local government, the architect may be much more likely to accept an or equal product, if pressure is applied. Is the decision maker or owner willing to entertain an “alternate product?” If the owner insists, the designer will usually acquiesce and take an alternate product, especially if budget is tight. Is the general contractor or construction manager eager for you to submit alternate products?
When the owner is relying heavily on the architect or designer and they insist that any other product submitted “had better be the same in all respects,” you’d be wise to go on to another project if the NorthStar mill rep is working with another dealer. The same would be true if the general contractor or construction manager advises that the project time is short and he’s not interested in accepting a submission of alternates. If NorthStar Mills has more than one product specified, or multiple colors in the same product, or several companion products within the same color range, then the chance of providing an “or equal” becomes extremely difficult. You’d be better off not to pursue such a project under these conditions.
However, let’s say the architect has been motivated by the owner to accept an or equal product because other parts of the project are over budget. The first thing to find out is what the he might consider to be equal; if the carpet is a 26 oz., solution dyed, branded nylon, multi-level loop, graphics pattern in earthtones, will almost any 26 oz. loop suffice (such as olefin)? Is there a particular feature (graphics pattern and color) or technical specification (density and solution dyed fiber) that is critical? You have to know this to successfully sell the value of an alternate product.
You and the architect or interior designer will be approaching the value proposition of an alternate from different perspectives. You will be trying to find the most apparent value for the least cost that will meet the minimum specification that’s important to and would be accepted by the owner. The intent of the architect or designer and goal of the owner is to reduce the price without compromising the design or useful life of the product.
Here are specific steps to take when you’ve decided to provide an alternate product and you’ve gotten questions above answered:
Do you have products available to you from a key supplier? Do your research and find multiple products with specifications that most closely match the specified item. Main items to consider: Face weight, gauge, fiber, dye method, coloration, followed by price at which the product may be obtained and delivery time.
Try and find two or more products to submit if you’re working directly with an interior designer and the submission process is less formal. There is no accounting for taste and determination of “design integrity.” What you may feel is the best alternate may not capture the attention of the designer. Avoid having to “go custom” by having them pick a running line product to avoid delays, the strike-off submissions, price hikes for custom, and custom overage requirements. By doing an “informal” submission and discussing it off the record and not forcing a decision, you can get a much better idea of what would be acceptable. Even if the submission is a formal one, you are usually better off if you can submit complete info including pricing on more than one alternate.
Use the “FAB” approach. It’s always a good idea to summarize the very best features, advantages, and benefits of the alternate you are submitting in a cover letter. You may also wish to point out some advantages that outweigh any differences or shortcomings. Especially important is spelling out the price savings with a comparison to the specified product.
Timely submission and follow up! Submit in a timely manner and don’t wait until the last minute. Once you submit, follow up by phone to answer any questions, particularly if there’s a special aspect of value that just might be missed. Also, get some preliminary feedback about your submission. If it sounds like they might not accept this submission, try to pin down exactly what would be approved. Better to withdraw a submission and submit something else than have something rejected officially.
Truthful not Critical. Sometimes you will be asked why you wish to submit an alternate selection. Be careful what you say since you’ll never be placed in a favorable light by criticizing other companies. Emphasize that as a professional you’ve developed key dealer relationships with other suppliers and have valuable alternatives, which can mean savings for the client.
Just remember, a design professional doesn’t like criticism any more than you do and may feel this way if you don’t carefully explain why you want to offer a substitute. In addition, reviewing an alternate product means extra work for them for which they may not be paid; this becomes significant when a particular product selection is an integral part of the overall design of the project.
Whatever you call it... selling the value, value engineering, providing an “or equal,” switching a spec, or offering a crossover, the intent is the same. Fulfill the requirement of the specification with a product that will allow you to win the job, make the most profit, and keep a happy client.