Are you taking every project that lands on your desk?
You can say NO.
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Ideal Project versus Ideal Client
Duayne I know when we start working with builders and a lot of the builders that we have conversations with, they’ve got in mind the kind of ideal project that they want to work on. And it might be that they want to be doing high end architectural homes. Or it might be that they want to be doing projects of a particular type, like rural projects, or, tiny homes or passive houses, or that kind of stuff.
And they’ve got very strong ideas about their goals for their project types. And that’s where their business vision is focused and what they’re moving towards. I wanted to ask you, though, what do you think is more important in running a successful building business, the project type that you build, or the type of client that you work with?
It’s all about building a great relationship.
Look, for me, it’s a pretty easy one now, it’s the client. In the old days, I just wanted to build great homes. I had architects that I really envied the work, the homes they were drawing, and I wanted to do their work. And I learned very quickly that, in my business anyway, that was a recipe for disaster. And we’ve come full circle. And for me, now, it’s completely the client.
The client has to be a client that we get on well together, that suits, we have similar personalities.
Why do you think builders often will just take any project that comes their way and not really think about ‘who’s the client?’ Or how’s this going to work? What do you see happening for builders in that process?
Well, look, I can speak from experience with this one. And it’s, I would say, most builders are in this situation. You end up in a position where you are taking any and every project that comes across your desk. And that could be anything from a backyard deck pool pavilion to a multi-million dollar home. So you’ve got all these different jobs going all over the place. The team doesn’t know what’s happening, it’s just a mess.
And I think a lot of that comes down to the fact that these builders need cash. They’re not interested in what type of job it is, they just need cash in the bank to keep the business going.
I remember when my business partners and I started our architectural practice, way back when, and there were six of us together. And we sat at a meeting. And I actually said, ‘we say yes to everything’. And it was the worst piece of business decision making that we could have done, because what it meant was that we pretty much took anything that came our way. And we didn’t get known for anything. And we didn’t get to choose what we were working on.
It really comes from a scarcity mindset where you’re panicked about how your next bill is going to get paid.
All of those jobs that you’re saying yes to, actually prevent you from saying yes to the things that you really want to do. Because your plate is full with all of this rubbish that is actually just not furthering your business, and you personally.
You just get stuck in that cycle where your gut is telling you, it’s not my type of job. My team is going to struggle with it. The client’s not going to gel with me. But you just get in that cycle where you just need a bit of cash, because you’re behind on your bills, or whatever. But at the end of the day, what is the point of taking on a project and signing a contract with someone that you can’t build a relationship with? These days especially with materials and trade availability, and those types of things even an average medium type home, you’re going to be dealing with these people for, even if it’s only building, possibly six, eight, 10, 12 months. And then if you’re involved with part of the design, it could be years.
So do you really want to be taking on every and any project that crosses your desk, just to get money in the bank, and know in your gut, that you’re literally going to have months and months of heartache?
Trust Your Gut
I think it can be really scary because we see builders grappling with this. That first call to say ‘no’ to a project, knowing that they need the cash. Knowing that it’s important, or they perceive that it’s important, in order to keep moving their business forward.
But when they make a decision that no, that’s not a good fit for our business. Or ‘no’, I don’t want to be working with that client for the next six, nine, 12 months. It’s amazing what happens in terms of the shift in them. In terms of the new standard that they set for themselves, and the new position that they put their business at, to make a decision of who they’re going to work with, and instead the kinds of relationships that they’re going to create with the clients that they want to work with.
Choosing a project based on the type of project and not the client is just a recipe for disaster right from the beginning. And I think the hard part out there is for builders that are probably getting involved in tendering scenarios. I know one of the big challenges for me back in the day was I went into jobs where the first time I met the client was signing the building contract. And I remember a couple of situations where I would actually call Camille up after the meeting. And my gut was already telling me from the vibe at the meeting the way that the communication went. And the questions they were asking, that they were looking down on me, and I just didn’t feel comfortable to begin with.
And so that’s pretty much how I choose my jobs now. I choose my jobs based on:
- the type of client
- the relationship we can build
- the type of personality we have; and
- the relationship that we can build and have over a long period of time.
Egos and Red Flags
Do you see builders, almost getting sucked in by their ego of, oh wow, that actually could be an award winning home. Or that building could be a really good piece of marketing for me. So I am going to ignore all the red flags that I have about this client. And I’m going to make a call to take on that project, because of the long term dividends of it. Or it’s going to look really good that I’ve done this project and it feeds their ego.
I know I’ve seen builders run into problems and then they’re down the track of dealing with a client and all of those red flags have come through. And they’re now trying to navigate getting paid on a job, and it’s terrible for them.
You’ve just outlined what I did for years. It was all ego.
We wanted to do the big flash homes. We wanted to win awards. And look over the years we did, we’ve won dozens of awards. But looking back now, all that, every award we won were in the years that we were struggling, we weren’t making money, we were going backwards. I was dealing with anxiety, depression, my family, our relationships were falling apart. And what was it all for? It was just a disaster waiting to happen. And look, I get it. It is so easy to fall into that trap. You want to be able to put great pictures on your social media, and win awards, boost your reputation, all those sorts of things.
But I’ve come to learn. One thing that I’ve really learned over the past couple of years, and definitely since we’ve had Live Life Build, is I don’t need 1000s of people following me. I don’t need all the awards. We’re a small business, we do six to 12 jobs a year depending on the size.
I want quality jobs where I can build a relationship, I can become friends with my clients and I know that my business is going to survive and my team’s going to enjoy them. My admin’s going to enjoy them. They’re going to work with our systems and processes.
And I know there’s a lot of builders out there that are taking on these award winning jobs and on face value. It looks fantastic. But behind the scenes, they’re falling apart.
This is the thing. You’re going to go into work every day. You want to, and you can, actually enjoy the process. You can enjoy the people that you’re working with. And when you enjoy the process and you enjoy delivering homes for people you actually really like and enjoy spending time with, that transforms how you get to show up in your life and in your business overall.
How do you choose your building projects? Is it the home design, the client, the price, or the need for cash injection?
Let us know in the comments below. We cover the challenges of choosing projects and not saying “yes” to every project a bit in Live Life Build, as we believe it is a core part of having a successful residential building business. You may also want to check out www.livelifebuild.com/blog/tips-for-builders-improve-yourself-to-improve-your-business/ or this one on improving your cashflow [www.livelifebuild.com/blog/progress-claims-your-way-to-better-cashflow/] so you can choose when to say yes, and that it’s ok to say no.