How to stop pursuing bad leads in your business

Sep 07, 2020

Do you know what is one of the most frustrating aspects of running a contracting business?

Its dealing with bad leads. The amount of time and energy wasted daily by contractors worldwide pursuing poor quality leads is staggering. And what do I mean by a bad lead?

I mean that lead that does not have a fighting chance of ever becoming a customer. The most common example is people who do not have the money (or who do not think its worth the money) to hire your services.

Another common case of a bad lead are the people who call assuming that you offer different type of services than the ones you actually offer.

I once had a customer who called me because he claimed to be interested in my industrial flooring services. When I showed up, he explained  that he didn't need any flooring but just to fill up a few holes ! I had to politely inform him that I do not provide such services, although I was boiling inside thinking that I had waste some precious hours of my life. 

I have personally wasted truckloads of time and money chasing and pursuing bad leads. So I developed few basic questions I like to ask prospects before booking a face to face meeting with them.

When do you plan on doing this project?

The purpose of this question is to eliminate the people that are in a total rush and expect you to show up tomorrow.  My staff tends to be booked for weeks in advance. It’s funny how some customers assume that you are just sitting at home waiting for the phone to ring so you can get out and work.

Also this question helps weed out the “maybe someday dreamers”. These people claim to be interested in your services but their vision is usually vague and so far out in the future. Often these people do not even have the cash, but they assume that some day in the future the money will magically appear.

Funny story: I once had a person asking specifically about pool coating services. He then admitted that he didn’t have a pool! But he wanted to know how much it would cost in case one day he gets a pool…

Are you the owner/ decision maker. And if not will that person be present at the meeting?

This is such an important question. Your chance of closing a deal increases significantly if the owner or the decision maker is present at the meeting. I have often been in the uncomfortable situation to get called to a meeting by an employee or by a spouse, only to realise that the people with the money are not even backing the project. I don’t care how friendly you become with the person who called you over, if they don’t have the power to make a decision you will never get the project!

What is your burning problem? How have you dealt with it in the past?

Every person that places a call for your services has a problem that need solving. If my roof is leaking I call a roofer. If I am expecting an inspection in two months I call the floor company to fix my floor (a common scenario in my business).

If the customer’s wife has been complaining about the furniture in the kitchen, the customer wants to get the kitchen remodeled. Obviously the customer may not be that direct and tell you that his wife is nagging him (!) but the whole point of these questions is to uncover underlying reasons. Customers start talking and then you find out the real reasons of what is going on. Sometimes red flags will come up during the conversation

Try to find out if they have worked with someone else in the past on a similar job. Were they happy with those services?

I am always very suspicious of customers who are very vague. It may mean that they are calling for a different reason. People will place calls for all sorts of reasons: Sometimes its competitors curious to see how much you are charging. Sometimes its people who decided to give the job to their buddy but they want to run a price comparison just to make sure that their buddy is not ripping them off. Obviously pursuing these leads is a waste of time.

How many days, weeks etc can you give us to get the project done?

Every now and again customers show up who expect that their job can get done in half the time necessary. In fact they even pride themselves on how ‘effective’ they are on pressuring people. Meanwhile they leave a trail of destruction wherever they get involved.

I often have prospects call and inquire about a project, but they have not even considered the fact that renovating their floor etc would require a certain number of days of downtime for their business. Make them aware on the phone about this issue. Last thing you want is showing up to a meeting, sending them a proposal and then they inform you that they cannot find the time frame to do the project.

These 4 questions should serve as a good start to qualify your leads. Usually the conversation on the phone will give you further ideas on what to discuss with the customer if you decide to set up a meeting. The main point however is to eliminate the time wasters, so that you can free up your time to pursue more profitable work .

So finally I want to hear from you. What are your experiences with bad leads?

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