selling, estimating and closing the deal if i only knew ... · get excited with them review and...
TRANSCRIPT
3/10/2017
1
Brian Altmann, CAPSPresident
DBS Remodel, Inc.
Selling, Estimating and
Closing The Deal...
If I Only Knew This 30
Years AgoJLC Live Providence 2017
Continuing Education CreditsInforma Exhibitions is a registered and/or recognized education provider with
The American Institute of Architects Continuing Education Systems. Attendees
can earn credit upon completion of this program provided you sign in with
appropriate license number on forms provided at the seminar room check-in
tables. Electronic Certificates of Completion for all attendees will be available
7-8 weeks post show.
This course is registered with AIA CES for continuing professional education.
As such, it does not include content that may be deemed or construed to be
an approval or endorsement by the AIA of any material of construction or any
method or manner of handling, using, distributing, or dealing in any material or
product.
Questions related to specific materials, methods and services will be
addressed at the conclusion of this presentation.
Copyright Materials
This presentation is protected by US and
International copyright laws. Reproduction,
distribution, display and use of the presentation
without permission of the speaker is prohibited.
© DBS Remodel 2017
Learning Objectives
Upon completing this program, the participant should be able
to:
The Scope of the Job, Part 21. Outline the step-by-step approach to selling
remodeling successfully and for a profit
2. Determine how to build and define all the details
3. Define what is reasonable profit
4. Discuss how to overcome objection and ask for
the sale
Objectives
Create The Job Scope
Estimate for Profit
The Presentation The Job Scope
BAThe Crown Jewel of the Contract
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BA
The Job ScopeA precious document that clearly
defines precisely what the consumer is purchasing. Leaving no stone unturned, this line by line summary outlines the
step by step components of all work to be completed, as well as expressing what is
not included and what is to remain untouched.
Precision ContractingEstimate
Bathroom Tile…$615.00
– Tear out old floor
– Set new tile
– Install new marble saddle
– Grout floor as required
– Remove all debris from site
Creating The Job ScopeReview digital picturesWalk the area and take quality notesCopy and paste a similar scope!!Think like a lawyer Organize chronologicallyUse indentsState the obvious and build value!Interview w/ Scope Development Sheet
ProtectionDumpster size
To remain untouchedRemoved/reset
Tear outWindow
Door Framing
InsulationShower details
Glass doorsFixtures
VanityMedicine cabinet
W/CAccessories
LightingVenting
TrimPainting
PlumbingElectric
Site conditionsVenting
Bath Scope Development Sheet Job ScopeThe following items to remain untouched
Entry door to bathBath windowEntire closet interior
Remove/ reset exstg. Window shadesTear out the following exstg. Items
Bath shower enclosureAll bath fixturesSheetrock and trim @ bath interiorTile floor and substrate above sub floorWall and ceiling insulation
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Sample Job Scope Erase all ambiguityLeave no stone unturned
Think window stickerInclude any services you offer
Job Scope
Estimating the Project for Profit What we must know
Cost of Goods Sold (COGS)Overhead (as % of revenue)Labor burdenNet profit we are looking to achieveHow to guess...accurately!Historical DataTo be realistic
Direct costs attributable to the production of the goods and/ or
services sold by the company. This includes material, direct labor costs
and third party expenses.
Cost of Goods Sold (COGS)
All ongoing business expenses not including or related to direct labor,
direct materials or third party expenses that are billed directly to
customers. A company must pay overhead regardless of whether high
or low volume of business.
Overhead
Investopedia
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Indirect costs associated with employees, over and above gross
compensation or payroll costs.
Labor BurdenHourly Rate...............................................................$25.00FICA and Medicare......................................................$1.91State Unemployment Tax..............................................$.38Disability Insurance.......................................................$.20Federal Unemployment Tax...........................................$.20Workers Compensation............................................. .$4.50Paid Holidays (5 days).................................................$2.08Paid Vacation (1 week)................................................$2.08Office Meetings (40 hours)..........................................$2.08Education (20 hours)...................................................$1.04Unbillable (1 week).....................................................$2.08Cell phone....................................................................$.18 __________________________________________________
Total Burden.............................................................$42.87
GP = Revenue – COGS
Gross Profit is the profit a company makes after deducting the costs
associated with making its product or providing its services.
Gross ProfitGross Profit – Overhead
Typically represented as a percentage, Net Profit Margin shows how much of each dollar collected by a company as
revenue translates into profit
Net Margin = Net Profit/ Revenue
Net Profit
Slippage is the difference between predicted and actual
gross profit margin.
Slippage
What Affects Slippage
Bad attitude
Inclement weather
Indecisive clients
Product delays/ damaged goods
Poor planning/ lack of systems
Too much/ too little help on job
Poor workmanship
Jobsite injuries
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Cost Analysis
COGS65%
Gross Profit35%
Cost Analysis
COGS65%
Overhead25%
Net Profit10%
COGS Anatomy
Materials plus taxLabor hours to produce project
SubcontractorsDebris removal
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Set Up and Clean Up13%!
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Includes 13% Add On (S/C)
(108 + 14 = 122 Hours)
(Includes tax)
@ 42.-Material 4, 500.00Labor @ 42.00/ hr. 5, 124.00 (122 hr)Subcontractors 5, 500.00Debris removal 600.00Subtotal 15, 724.0035% GP margin (/.65) 8, 466.00Total Investment 24, 190.00
Bonus Slide!
The Calculation
To achieve a 35% GP…Divide by .65
orMultiply by 54%
Presenting The CPE
Focus on Value to Avoid the Risk of Negotiating on Price!
Assume We Are Doing Business…At
All Times!
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Get excited with themReview and change as necessaryOffer multiple optionsAsk them if they like it!Are you pleased with our companyMay take multiple meetingsProceed to job scoping @ completion
Design
A Value Building Machine!
The Job Scope
Review Job Scope w/ Prospect
All documents in presentation folderAlways provide 3 copies @ meetingAll decision makers presentExplain that this is hypothetical criteriaReview slowly and teach wellBring red pen for changesAre you pleased with our efforts?
Revision Meeting
All changes in green textReview green text changesInvestment not shown at this pointAsk if all is clear/ anything to review?Pleased with this service so far?Are you appreciating the value of CPE?
The Investment
Reprint last page of scope w/investmentPresent a la carte items as requestedDisplay any discountsTally and present final numbers and...
Review Payment Schedule
CPE deposit: $600.00 (received √ #312)Start of project: $7, 550.00Start of electrical: $4, 000.00Start of sheetrock: $4, 000.00Start of tile work: $4, 000.00Project completion: $4, 000.00
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Ask for their Business!
Objections
Build your company so that the only objection is Price!
We need some time to think about it
That’s more than we expected! Let them know your pencil is sharp!
This should be discussed @ CPE signing
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Share your expected net profit!
COGS65%
Overhead25%
Net Profit10%
Building Value
The 5 Year Blues
How happy do you want to be in 5 years?No Regrets!
Everyone Wants a Discount!
Keep your margin BUT make them feel good!
A great reputation
Raving fans
Organization within your company
Professionalism
Amazing receptionist
Transparency
A passion for job scoping!
No fear!
What you must have to succeed
Close the deal...
Brian Altmann, CAPSPresident
DBS Remodel, Inc.
JLC Live Rhode Island 2017
Questions
Thank You!
This concludes the Continuing Education Program