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How Do You Compete Against the Best?

The measure of a quality company is how it compares to its quality competition

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When I talk to contractors about their businesses, I’m always curious about what kind of operation they run. How good of a business do they own? To get to the meat of that question, I have a question I routinely ask: “How do you compete against your quality competition?”

I don’t really care how companies stack up against poor, fly-by-night operators. Usually, that’s a simple issue of competing against a low-priced competitor who can do little to back up his reputation. To combat that group, you just have to talk to prospects about your reputation and encourage them to check references for all the firms eying the project. Any building owner worth his or her salt will quickly understand that hiring a low-priced company with low reputation is a fool’s bargain. As a friend of mine often says about contractors, “If you hire the lowest priced, you should also hire a lawyer at the same time.”

So, how do you compete against quality competitors? What is your differentiator against those contractors who are successful at delivering quality projects on time and on budget, and have an excellent reputation for customer service?

I think it’s worth going through an exercise to articulate what are your differentiators against the best. Too often I hear contractors defer to two kinds of statements when trying to articulate what makes their companies better. They say, “we take care of our customers,” and “we pay attention to detail.”

Okay. Those are good, but more interesting is how do you do that? How do you take care of your customers and how do you pay attention to detail? Can you tell me—or your prospects—that?

Because if you can show people how you have processes in place that ensure good customer service, then you can demonstrate your quality difference. The same is true of your attention to details. What system exists within your company to ensure your employees and trade contractors are focused on not missing details that delay or undermine projects? Do you have a system of meetings that facilitate communication among all the stakeholders? Do you have a documented routine that you follow on every project, and all your employees know that routine?

That is the difference between great companies and good companies, and that is how you compete on a quality basis rather than a price basis. Nobody wants to compete on price because there is always a low-cost alternative. And competing on quality requires you to demonstrate that you are a quality company; you can’t just say it. You have to show it.

For metal building erectors, the AC 478 Accreditation program helps them establish the systems that deliver on those quality promises, and provides independent verification that they can meet those claims. For other contractors, there are any number of quality management programs that help them establish those systems. Accreditation and certification programs help you show that you’re good.

That’s what your prospects want. They want a company they can trust to do the work on time and on budget. And if they can trust you, they will pay more for your services. And if you can get more for your services, increase your margins, then you can build a sustainable business that will survive downturns in the economy or other setbacks. That’s the goal, isn’t it? Not to make money, but to build something that will last. To do that, you need to deliver, as a matter of routine, the best your company can offer.

Plus, it’s a lot more fun and people will want to work for your company, making it easier to attract quality workers in a labor shortage. But that’s a whole other conversation.