3 ways to increase sales for your construction business

Canadian construction firms face a whirlwind of challenges. These include labour shortages, rising material costs, more demanding clients, longer sales cycles and increased competition in urban markets.

Businesses can respond by renewing their revenue growth strategy, boosting sales performance and honing their marketing efforts.

“Many of our clients are used to growing through word of mouth, but in recent years, that approach is becoming more challenging,” says Rebecca Chan, a Senior Business Advisor at BDC. “It’s important to develop a proactive and systematic approach to building sales.”

Chan outlines three steps to boost sales for construction companies.

1. Develop a revenue growth strategy

It’s important to take the time to develop a strategy to increase your sales. This will allow you to focus your efforts on the highest-potential opportunities and outline a concrete action plan to achieve your business goals over the next 12 months.

Evaluate your current state

The first step is to examine where your business currently stands. Review your company’s existing efforts in these areas:

• Sales and marketing activities to determine what’s working and your readiness to capture growth opportunities
• Market segments, sales channels and digital strategies
• Product maturity, lifecycle and revenue profile
• Organizational and financial readiness to pursue growth opportunities

Brainstorm ways to achieve your goals

Next, consider where you’d like your business to be in the next three to five years. Then, brainstorm with your team to identify five to 10 high-potential sales growth opportunities to achieve your goals. Evaluate them based on:

• market attractiveness
• strategic fit
• delivery capacity
• investment requirements
• expected return

Opportunities exist in the following areas:

• selling more of your current services to existing and/or new customers 
• selling new services to existing and/or new customers 
• increasing customer retention 
• reactivating former customers 
• acquiring a new business

Opportunities could also include strategies to better exploit markets. For example: 

• Pursue niche markets—Specialize instead of generalizing. “Pick your niche and do well in it,” Chan says. “If your niche is multi-family buildings, be really good at it and focus on it.”
• Consider renovation and retrofitting—As costs rise, more customers are renovating and retrofitting existing buildings.
• Offer thought leadership—If you’re an expert in your field, talk about it. Use your website and social media to talk about construction trends, give regulatory updates and showcase what you know about your niche.

• Focus on customers—Don’t neglect customers. A good way to stand out is to offer a great client experience. “Customers these days are looking for speed of response, proposal quality, communication and follow-up.

  “A lot of businesses are so busy, they forget to communicate the great work that they’re doing. It could just be a quick email to say, ‘The project’s going great.’”

• Give peace of mind—Customers want greater confidence in cost, schedule and delivery. “Because of labour shortages, inflation and economic uncertainty, contractors need to demonstrate strong planning, scheduling, procurement processes and project controls,” Chan says.

  “This gives your clients peace of mind and a feeling of trust. That could lead to new projects down the road. The more contact you have with your client, the more understanding and trust you develop. You also become an expert in their needs.”

• Do a digital assessment—Assess your digital maturity and identify ways to improve. Consider taking BDC’s free online digital maturity assessment. Studies show that more digitally sophisticated companies enjoy higher sales growth and resilience than their peers.
• Consider segment-specific strategies—Different segments require specific strategies. “The key is to put yourself in your clients’ shoes and know what they need,” Chan says. “What’s in it for them?”

• Residential—Customers in residential construction are looking for cost certainty, speed to completion, energy efficiency, reliable trades and financing confidence. Your message shouldn’t be, “We build custom homes,” but rather: “We help families move into their dream home on schedule and on budget.”

  Pull on the heartstrings, provide good communication, give a clear timeline and budget. “This is what they’ve been saving up for,” Chan says. “Put them at ease. Show customer testimonials. Prove you’ve done this before; this is your neck of the woods.”

• Commercial—The commercial market has moved significantly away from ground-up construction to renovation. Customers are asking, “Why should I build?” rather than, “Who should build it?”

  Builders need to understand customer experience, building use, maximizing space, sustainability and how to help commercial clients be more operationally efficient

  Your message shouldn’t be, “We build facilities,” but rather: “We’re going to help your business grow through a facility designed for efficiency, scalability and customer experience.” Position yourself as being able to make your client’s life easier.

• Industrial—Priorities in industrial construction are safety and compliance. Industrial clients typically deal with a lot of rules and regulations, which are more important than aesthetics. Operational continuity, logistics, productivity and risk reduction are other key concerns.

  “Put yourself in their shoes and consider how you could  provide operational improvement: faster throughput, better workflow, reduced downtime, employee productivity,” Chan says.

  “They’ll want to know, ‘Can you meet my schedule? Can you help me navigate the regulations?’ The contractor becomes a risk management partner, not just a builder.”

Develop an action plan

Create a shortlist of the best two or three opportunities. Then develop an action plan for how to pursue those over the next 12 months. This should include:

• a set of initiatives to pursue each opportunity 
• breakdown of the detailed steps to achieve each initiative, including for different teams such as sales and marketing, operations, IT, human resources, etc. 
• timeline for fulfilling the steps 
• key performance indicators to gauge progress 
• people on your team responsible for each initiative

Consider bringing in outside expertise if you need help developing a strategic plan or planning an initiative such as an efficiency exercise.

2. Boost your sales performance

A key way to improve your business revenue is to boost the performance of your sales team. This could be an initiative in your strategic plan above, or it can be a stand-alone project.

It’s worthwhile to focus on this area if your sales team faces challenges such as:

• high turnover
• inaccurate forecasting 
  
• ill-defined processes
• lack of alignment
• ad hoc efforts

Ideally, you want to move your team toward:

• an adaptable and scalable model
• predictable results
• best practices
• metrics and external benchmarks
• early problem recognition and structured problem solving
• continuous improvement

“The last thing you want is all the information resting in the sales rep’s head,” Chan says. “If they leave the company, all that knowledge is gone. Documenting your process also lets you see where there are gaps in performance and how you can monitor and improve your efforts.”

Chan takes clients through five steps to build a better sales practice.

Assess your current efforts

Evaluate your current sales and marketing efforts to identify strengths, gaps and improvement opportunities. Understand your market, the competitive landscape and your unique offering.

Know your customers

Next, identify your ideal clients and map their “journey” as customers. This means documenting:

• how they first hear about you
• what makes them interested
• how they compare options
• who makes the decision
• what makes them buy
• what happens after the sale

Think about whether there are services your clients are looking for that you haven’t offered yet. What do your customers say about you? How can you improve how your customers feel about you?

Use all this information to craft sales and marketing messages that resonate with your customers and let you stand out from the competition.

Develop sales prospects

Create a process for building a steady flow of potential customers. This can include:

• Targeted outreach—Identify, prioritize and contact customers and decision-makers who are most likely to buy.
• Clear messaging—Develop emails, pitches and sales materials that explain your value.
• Consistent prospecting and follow-up—Regularly find, qualify, follow up with and track prospects rather than waiting until the pipeline runs low.
• Use data to optimize—Track which activities generate qualified leads and sales, and focus on what works.

As part of this step, it’s valuable to build a sales communication script. “What exactly do you say to introduce yourself?” Chan says. “How do you describe your capabilities? How do you propose to address client challenges or respond to objections? How do you do follow-up emails?”

Make a sales plan

Now you’re ready to document your sales process and develop a plan to improve your team’s performance.

• Map your process—Document all the steps you take to get new clients. This should include:
  • how you find potential customers
  • how you decide which customers are likely to do business with you
  • steps from the initial discussion to proposal, follow-up and closing
  • ways to measure how many prospects advance at each step and where they drop off

• Set revenue goals—Define revenue targets and the sales activities needed to reach them.
• Track performance—Use measures to see what’s working and where sales fall short.
• Forecast sales—Estimate future sales based on current prospects and past results.
• Use sales data—Use data to guide priorities and decisions.
• Consider a CRM system—Explore the idea of acquiring a customer relationship management (CRM) system. It can help you organize your sales efforts, analyze data and become more efficient.

Empower your team

Continue to improve by providing sales managers with the tools to coach, onboard and align compensation with performance and growth goals. You can also provide coaching to managers to further boost their efforts.

“The company’s leadership may not have a lot of sales management experience,” Chan says. “It’s very helpful for them to have the right tools to lead sales meetings and create a culture of excellence. They should be able to empower their sales team so they feel supported, especially as you grow.

“It’s also important for your team to be left with practical tools—not just a document on your computer, but initiatives that will actually be implemented.”

3. Focus your marketing efforts

Create a marketing plan to identify the promotional tactics that will help you accomplish your revenue growth strategy. “You want to amplify the good work that the company does,” Chan says. A marketing plan typically includes:

• assessment of the competitive landscape
• SWOT analysis (your strengths, weaknesses, opportunities and threats)
• customer profiles
• initiatives to promote your company

Initiatives can include:

• brand awareness campaigns
• client testimonials or case studies
• sponsorship
• social media and website content
• advertising

It’s important for the marketing plan to complement your sales plans. Also be sure to collect data on the performance of your marketing activities, so you can focus on the ones that work best.

“By identifying the right target audiences, marketing channels and messaging, companies can increase brand awareness, improve lead quality, support business development and create a repeatable marketing system that brings new customers and fuels long-term growth,” Chan says.

Next step

Discover how to update your sales strategies to today’s reality by downloading BDC’s free guide, Revving up Your Sales.