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Leatherneck
08-09-2008, 07:18 AM
There are some businesses that fell the effects from a down economy more the others.

How has the down economy effected your business if it has, and what are some of the adjustmentrs or changes you have had too make?

I know that there are a lot of variables that come into play that differ from business too business, But I bet one persons advise could help anothers.

Steve B
08-09-2008, 09:11 AM
I'm definately effected by the economy - I'm guessing it's similar for us since we both sell fencing (although very different, they are both purchases that can be put off a little longer).

To adjust - I'm spending more on advertising so I can try to get the customers that are there. I also have begun to only do quotes over the telephone. I was spending too much time and gas giving quotes in person. I'm sure I have lost some jobs because I wasn't there in person - so, I'm not sure this was a great move but since I do everything myself - something had to give.

Spider
08-09-2008, 09:19 AM
Well, I'm pleased to report that I have yet to feel any effect of a 'down' economy. My wife's pet grooming and boarding business is the busiest it has ever been, and my coaching business is still ticking along fine.

I don't know if Houston is any different from the rest of the country or if what I hear of the rest of the country is all media-generated nonsense. I suspect the latter. Sure, some excesses in the mortgage investment industry are having effect further afield but I don't think it's nearly as bad as the nation's news-rooms like to make out.

I suspect there are a lot of people making money by promoting this so-called recession. And still 95% of the people who want a job have one.

Leatherneck
08-09-2008, 11:18 AM
I agree Steve. Fences are not a necessity for many people, but they are for some. The ones that are, are for the most part keeping me afloat.

Alot of my jobs do come from people who own dogs. They want to have a large area for there dogs too run free.

I have done the same as you, where I try and give more prices over the phone instead of wasting alot of time going out to compete with who knows how many other contractors, the customer has called. I tend too keep the price on the lower side as not too scare them off, because there are contractors working for nothing out there and I don't want too get disqualified over the phone price. Then If they like the price I schedule a meeting with them too fine tune the proposal.

I agree with you Spider on that the news media plays a big part in having people worried about where things are going with the economy, I wish there was a way too convince people that things are really not as bad as the media makes them out too be.

vangogh
08-09-2008, 12:10 PM
It's hard for me to tell how my business gets affected by the economy. My clients are working on their businesses when they contact me. Some upgrades to their sites aren't necessary so they may hold off on those kind of changes. Other upgrades are necessary so they still want them done.

In the end it's still work on their businesses so I don't think there's the same down economy effect.

I have noticed over the years that summers tend to be slower than the other seasons. Maybe it's more people on vacation and not thinking about business, but some of my clients I don't hear much from during the summer months.

billbenson
08-09-2008, 12:19 PM
I'm in Florida where the housing market has been hit very hard. A few years back, there was panic buying of houses as prices were skyrocketing. People were buying with variable rate loans and streaching themselves to thin. $200k houses were going for $500K. Then things turned bad. Now there are a ton of foreclosures. I think Florida and California were the two hardest hit by the above.

A couple of examples. I went to the dog pound interested in adopting a dog for my wife. They have a lot of big dogs because people were forced out of their houses and couldn't keep a big dog in an apartment.

Most roofers were illegal immigrants. My wife worked for an agency similar to western union, but the specialized in sending money to Latin America, mostly Mexico. Most clients were illegal immigrants. Two years ago, on a Saturday, she would have 200 plus customers and send $40k to Mexico and elsewhere. They just recently closed her office and she is out of work. It dropped to two clients on a Saturday and sending $200 dollars. She had a lousy job anyway, so just as well that she left.

For me, I sell a lot to the government, oil industry, military, commercial construction etc. I have seen very little if any downturn.

Paul Elliott
08-09-2008, 08:18 PM
In a way it has helped my marketing business. The small businesses who are in poor shape and haven't a clue don't want to think of spending money on marketing when they should be doing quite the opposite.

The companies which are in trouble and are determined not to let themselves sink are very ready to take the guerrilla/stealth marketing approach and scarcely have to be sold.

They love my approach of mining their existing assets before branching out.:D

Paul

Paul Elliott
08-09-2008, 08:20 PM
I agree Steve. Fences are not a necessity for many people, but they are for some. The ones that are, are for the most part keeping me afloat.

Alot of my jobs do come from people who own dogs. They want to have a large area for there dogs too run free.

I have done the same as you, where I try and give more prices over the phone instead of wasting alot of time going out to compete with who knows how many other contractors, the customer has called. I tend too keep the price on the lower side as not too scare them off, because there are contractors working for nothing out there and I don't want too get disqualified over the phone price. Then If they like the price I schedule a meeting with them too fine tune the proposal.

Mak, tell us a little bit more about your business and the type of fencing you represent or install.

Paul

Leatherneck
08-09-2008, 09:07 PM
Paul I see your from Northere Louisiana. I started my career as a carpenter living in New Orleans as a young man after being discharged from the Marines.
I have many fond memories living in New Orleans.

I sell and install many differnt styles and types of fences, the industry has to offer. There are many styles too choose from and the industry is always comming out with new and different products. I think wood will always be the dominate fence material. There are many products out there that have tried too replace wood but it always seems like the perfered choice.

I want too take my business too a level that seperates me from most of my competion, by offering custom fences. I also want too offer custom decks and Pergolas. I'm a authorized installation contractor for Garden Structure .com which is all up scale work. I'm in my third year doing work for them.

Paul Elliott
08-09-2008, 10:24 PM
Paul I see your from Northere Louisiana. I started my career as a carpenter living in New Orleans as a young man after being discharged from the Marines.
I have many fond memories living in New Orleans.

I'm in Ruston much of the time and spend time in Dallas and Waco, TX.

I love New Orleans, too. It's making a very slow return, but, sadly, it'll never be the place you and I have known.


I sell and install many differnt styles and types of fences, the industry has to offer. There are many styles too choose from and the industry is always comming out with new and different products. I think wood will always be the dominate fence material. There are many products out there that have tried too replace wood but it always seems like the perfered choice.

So recycled plastic water bottles and Wal-Mart bags won't kick wood off the block, huh? :confused:


I want too take my business too a level that seperates me from most of my competion, by offering custom fences. I also want too offer custom decks and Pergolas. I'm a authorized installation contractor for Garden Structure .com which is all up scale work. I'm in my third year doing work for them.

What do you do that your competitors do not? --your Unique Selling Proposition (USP).

How large is your list of previous customers?

Do you do any marketing to them? What would be the likely things they would want from you based on what you have already done for them?

In an ancillary fashion, what could you offer them as a bonus for any referrals they could give you?

Paul

Leatherneck
08-10-2008, 08:24 AM
Repeat customers happens from time to time, but for the most part a fence last for several years before it needs replacing.

I do get referels a lot and the more my former client list grows the more i'm sure the referals will also.

Right now with the housing market suffering so bad in Mass. It has effected all aspects of the building industry. There is still work going on, but with the competition cutting each others throat it makes it hard too work for much of a proffit. It is the luck of the draw on who or how many contractors the customer calls for an estimate.

If you happen too be up against Joe Shmoe the fence man, who works out of his pick up as an office, and has little or no overhead. It is lights out on any chance of competing with those. I find a lot of people don't seem too care how there fence will look. They think a fence is just a fence and they are wron and misguided. I have tried too explain too my clients that the cheepest is not the best in most cases. Some timse I win and some times I lose.

There are even so called contractors that come along and ask for the other bids and tell the customer they will beat all other estimates. How can I compete with them. In the down economy with a lot of people needing a fence the bottom line is the dollar. I'm sure alot of you here are going through the same thing with your businesses

Paul Elliott
08-10-2008, 03:57 PM
More questions.


Repeat customers happens from time to time, but for the most part a fence last for several years before it needs replacing.

Remind them you were the one who installed their fence, then offer a killer special on refurbishing their fences--alignment, rehanging gates, bracing, repainting/staining--whatever fencing projects need. I don't know what all fencing can suffer after several years in place, but I'm sure there are plenty of things of which you are well-aware. You could bring those up to the homeowners and offer to give them a complimentary fencing inspection.

This is part of the relationship building--I call it "affinity bonding"--with your customers. It is a process, but it's never too early or too late to start. Why not start now?


I do get referels a lot and the more my former client list grows the more i'm sure the referals will also.

GREAT! You're already seeing the value of the projects you have already done. Start leveraging that immediately! Go to the link in my signature and get the e-course on stimulating WOM advertising.

Trade on your reputation to get even more business.


Right now with the housing market suffering so bad in Mass. It has effected all aspects of the building industry. There is still work going on, but with the competition cutting each others throat it makes it hard too work for much of a proffit. It is the luck of the draw on who or how many contractors the customer calls for an estimate.

Get OUT of the commodity business! By that I mean "the lowest price gets the business."

What is your USP? You should use that to distinguish yourself from your competitors. THAT is your brand.

Please do not tell me "all fencing is about the same." YOU must be different! If someone wants the cheapest deal, allow them to get someone else's bid.

I realize you may have to "low bid" until you get your brand built better.


If you happen too be up against Joe Shmoe the fence man, who works out of his pick up as an office, and has little or no overhead. It is lights out on any chance of competing with those. I find a lot of people don't seem too care how there fence will look. They think a fence is just a fence and they are wron and misguided. I have tried too explain too my clients that the cheepest is not the best in most cases. Some timse I win and some times I lose.

Again, do that only as much as you have to WHILE you aggressively build your brand. You certainly realize some of the low bidders don't even know they are losing money on their jobs. They will keep on losing money until they have to leave a job half done so they can eat.

You don't have time to let all the fools put themselves out of business. They keep making more fools!;)


There are even so called contractors that come along and ask for the other bids and tell the customer they will beat all other estimates. How can I compete with them. In the down economy with a lot of people needing a fence the bottom line is the dollar. I'm sure alot of you here are going through the same thing with your businesses

Don't sell the lowest priced fence installation. Position yourself above that. You need to educate your customers out of your marketing dilemma. Your marketing dilemma? Not enough business! (In my free e-course "88 Marketing Tips" below) Tell them why you will never be the lowest bid on a job, merely the best AND most economical.

Do you offer peripheral services? For example if dog owners wanted to fence a back yard and build a kennel with a concrete floor with chain link fencing.

Do you offer the imbedded electronic fencing for dogs?

What are other things that fence purchasers might want or use that you might offer?

Leatherneck
08-10-2008, 05:35 PM
Thanks for all the help and advise paul. I will be doing some reading

vangogh
08-10-2008, 05:59 PM
The idea of a free fence inspection is a great one. Mak whenever you're finishing a job let your customers know you provide free fence inspection for X # of days, months, years, whatever. Maybe one a year and tell your customers to call to set up an appointment.

If they don't call them after 6 or 9 months and remind them about your free inspection and see if they want to set up an appointment.

Even if no one ever takes you up on it they'll remember you for offering to check their fence for free in the future. Maybe the first few months you offer a guarantee to fix things. I think you do that anyway where you'll fix something if you didn't do it as well as possible.

When customers do want the inspection take a ride to their place and look over the fence. You'll be able to see if the fence does need any work which you can recommend, but even more it will build your relationship with your customers and they'll be more likely to recommend you that way.

Paul Elliott
08-10-2008, 09:08 PM
Even if no one ever takes you up on it they'll remember you for offering to check their fence for free in the future. Maybe the first few months you offer a guarantee to fix things. I think you do that anyway where you'll fix something if you didn't do it as well as possible.

When customers do want the inspection take a ride to their place and look over the fence. You'll be able to see if the fence does need any work which you can recommend, but even more it will build your relationship with your customers and they'll be more likely to recommend you that way.

David, there is a way to set up a direct mail reminder system for every customer. You simply set it up and it goes like an email autoresponder. PM me if you want more information.

For businesses too busy to do that for themselves, I offer a service doing it for you at a reasonable rate.

Again, PM me, if you want more information.

Paul

SteveC
08-11-2008, 12:59 AM
Can I make a suggestion…

Can all business owners that read this to please decide not to participate in a downturn/recession…

It matters not if an economy is booming or slow, there are always opportunities… people are still buying whatever it is you are selling… so decide not to take part in the downturn and get out there and sell based on that belief.

A mentor of mine states that Life is a self fulfilling prophecy so choose your future carefully.

Blessed
08-11-2008, 08:10 AM
I'm a graphic designer so I basically work in marketing - I'm also working with a friend and we are starting a shopper magazine here in our town. The first issue just went to press last week - it isn't making any money this month but we've got four or five signed ad agreements for 6 to 12 month contracts already - without having an actual product to show advertisers and with only working at selling for about 2 weeks. Additionally we have several solid leads for next month's issue and since we'll have a sample we can leave with people it will be easier to start selling the magazine.

I haven't really noticed much of a downturn in the economy - I've had a bit of a downturn in my personal business because I work for myself from home and I'm a stay-at-home Mom and my husband likes clean clothes, a clean house and dinner every night so I'm limited on how much work I can take in. I lost my biggest customer this spring because they were getting so big that they had to hire an in-house designer - I basically worked myself out of that job, I'll get work from them again once they keep that person busy all the time but for now all I get are requests for their files. So I've been trying to fill the gap losing that business created and had a couple of pretty slow months, now it's better and as the magazine takes off it will get even better! I'll get paid for putting that together plus commission on any ads that I sell and I'll also get paid for every ad I design for the magazine - I think this will become a good thing!

Paul Elliott
08-11-2008, 10:04 AM
Blessed, are any of your advertisers willing to contribute special offers for you to do promotional drawings?

Paul

cbscreative
08-11-2008, 09:49 PM
I like what SteveC said. Being in Michigan, we have had a single state recessin for years, yet I keep seeing growth in my business. There is a great deal of truth in having ths attitude of refusing to participate in a recession. It's also true that people still buy during a recession. The trick is, getting them to buy from you.

Mak, in your situation, you are dealing with home owners. The ones who want the cheapest price on something that is for their single biggest investment in life is not your target market, or they need to be convinced that the price is worth the difference. You don't have to win all of them, just enough to keep busy.

Blessed
08-11-2008, 11:04 PM
Blessed, are any of your advertisers willing to contribute special offers for you to do promotional drawings?

Paul

Hi Paul!
Actually some of them are - this time those donations are going to a charity benefit auction my partner is having at her other business - she owns a children's resale franchise in our area that has a sale twice a year (not a storefront - rent a large space two times a year and have a four day sale) she came to me looking for help with the magazine and for ideas to set her sale apart because she has been doing the sale for the past 6 years and now there are two copy cat sales that rent the same location and have their sales too - this is really a pretty big business and she was looking for ideas to make her sale stand out from the rest and to increase her profit margin since she left a good paying job to be able to spend more time with her family and our advertising magazine is going to take a few months to get off the ground.

One of the things that she always does is write a check to benefit a local foster care and adoption association that provides clothes, shoes and toys to children who are in the foster care system or older children who are available for adoption so when we were talking about how to further promote her sale over the others she said that one of the ways she had been able to get free advertising was by emphasizing the clothing and money that is donated to the charity so I suggested a 3 hour kids fest on the Friday night of the sale and a silent auction beginning the first day of the sale and ending on Friday night at the end of the kids fest. All the proceeds from the auction would go to the charity. This would eliminate the need for her to write a large check from her profit to the charity and probably would give the charity more money than they had been receiving. She loved the idea and we are getting some great donations - the kids fest is starting to come together too - we are letting people come and set up at the Kids Fest for no charge as long as they donate a portion of their proceeds from the night to the charity (we're letting them decide what percentage to donate). We'll see how it goes if it goes well then next year we might charge for booth space... this year I'm just hoping we find another clown because it's been a few years since Hoppy the Clown and her Froggy companions have been out and about - I'll have to learn how to walk in those shoes all over again otherwise!

Ok. that was the long way to say that advertisers are willing to donate things - for promotional drawings? I hadn't thought of that yet - right now we're just thinking about getting all those ad spaces in the magazine filled with paying advertisers - my partner is in the hole about 7k for this first issue!

Oh and I use the term "partner" loosely - we aren't really partners but I feel like her idea has a lot of potential so I'm dedicating a lot of time and effort to it and am cutting my rate for these first couple of months to see if I can help her get it off the ground. As far as the "partnership" goes - it's her business, her money making it happen and her original idea. I'm providing printing expertise, advertising sales experience and the design of the magazine and any ads that our customer's need designed. So she's the publisher, I'm the designer and we're both Sales Reps... and in the meantime I have other customer's that need work done too!

... I think I talk too much :D

vangogh
08-12-2008, 01:04 PM
I found this article about why a down economy is actually the best time to advertise (http://www.invesp.com/blog/sales-marketing/advertising-in-a-recession.html) and thought people might be interested.

Two main reasons for advertising when the economy is bad:


Lower prices
Fewer competitors

Worth thinking about. If less of your competitors are advertising now and you can buy ads cheaper you should be able to pick up more customers than your competition, while paying less to acquire each new customer.

Blessed
08-12-2008, 01:37 PM
Vangogh - you are right about lower prices and fewer competitors.

For the ad magazine I'm selling ads for we started giving ads away at the end because we wanted the magazine to be full of ads from real companies that were not associated with people we know personally (those people are advertising too, but since we know them personally it will take a lot longer to get them to pay for ads.) We asked the advertisers that got free ads to consider a 6 month ad agreement and to put a coupon in their ad so that the people who get this in the mail would be motivated to keep the magazine. 99% of the business we talked to jumped all over this offer and we had no trouble filling the magazine.

However, I contacted one small business that is basically the same thing that another small business in our town is - except that the other business is a franchise. I told them that we would love to have them advertise with us and that I would give them a half page ad free this time if they included a discount in their ad and would think about doing a 6 month ad agreement starting the next month. They are a struggling business - they are in a good location, it's a children's clothing resale business so it has a large market, but they are in a strip mall and no one knows they are there - the man was excited about advertising with us, his wife said they couldn't afford it this month, maybe next month.

How can you not afford a free ad?

My point is that advertising really is cheaper right now AND usually you can negotiate a lower price with your ad salesman. Especially if you are in a retail or service type business whose main customers are local. Now hopefully I didn't just shoot myself in the foot... anyone want to buy an ad? I'll make you a deal.... :)

KristineS
08-12-2008, 01:45 PM
I think there is truth that continuing to advertise in a down economy can bring you more revenue. First, as Blessed demonstrated, a lot of your competition won't be advertising because they think they can't afford it. Second, a lot of publications may have ad space that they're willing to let go for bargain rates because people aren't advertising. So, not only are you advertising when your competitor's aren't, you're getting the space for less than you might usually pay.

I'm not sure what's up with the guy's wife that caused her to turn down a free ad, Blessed, but you're right, who can't afford a free ad? That's just really poor thinking.

vangogh
08-12-2008, 02:22 PM
@Blessed - Isn't it funny how people can't afford free? I think when it comes to advertising too many only see the spend part and don't think about the return. The same people will be looking to advertise with you in 6 months or a year. They'll get the same return, but at a much higher price.

@Kristine - Whenever the economy heads south my first thought is almost always of the people who have the money to buy. The people who buy in a down economy are the ones who'll have a lot of valuable stuff to sell when the economy rebounds and booms.

cbscreative
08-12-2008, 02:34 PM
I addressed some issues like this with an article I wrote earlier this year. Below is a brief quote from that which is relevant to this discussion:


When the economy slows, many business owners respond by cutting back. That classifies more as a reaction than a strategy. That reaction can be very detrimental, especially when cutting back includes marketing and advertising. Those who react this way may not survive a recession, much less come through strong when the recession is over.

You may very well need to make adjustments in your business to grow stronger. A brainstorming session can be very helpful. Customer surveys, both formal and informal, could provide valuable information, too. Look for opportunities because they always exist.

Once you identify opportunities, then developing a strategy will help you seize those opportunities. Focus on what motivates people to buy, identify who should buy from you, and then convince them to buy from you. With that, you will have a winning strategy.

People buy for one or more of the following reasons:

To make money.
To save money.
To save time.
To make things easier.
To make them feel better or satisfy a desire.
To solve a problem.
To take away pain.

Once you know which of these you can use, or which combination of them, then it's time to get your message out.

Let me use a simple example to illustrate this point. Several years ago when there was a recession, the makers of A1 Steak Sauce® made a very wise decision. They reasoned that people might not buy steak as much during tough economic times, which could hurt their sales. So they launched an ad campaign touting the merits of using A1 on burgers to make them taste better. That strategy worked great, and sales went up.

I was really dealing with prospering in any economy regardless of recession or no recession, but a recession seems to be on everyone's mind so I wrote from that perspective.

Especially important is knowing why people buy. Too many advertisers are missing the mark on that one and wondering why the advertising doesn't work. So in addition to taking advantage of advertising opportunities, make sure you're remembering why people buy, and fill that need.

Blessed
08-12-2008, 08:50 PM
Especially important is knowing why people buy. Too many advertisers are missing the mark on that one and wondering why the advertising doesn't work. So in addition to taking advantage of advertising opportunities, make sure you're remembering why people buy, and fill that need.

That is the absolute truth... it's part of what I'm in business for - to help small business owners who have great businesses but no idea how to market them with their marketing needs, strategies and advertising. It's fun and fulfilling work.