Contractor Optimism Trends in 2014

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According to a recent 2014 Contractor Behavior survey by L.E.K. Consulting, contractors are becoming more optimistic about the growth of their business. Their survey of 550 residential and commercial contractors revealed three changes in behavior, all of which we will explore in greater detail.

“First, they are becoming more aggressive during pricing negotiations and are walking away from jobs that don’t provide attractive margins.”

In 2010, the same survey found that nearly 44% of contractors were forced to occasionally drop their prices. In 2013, only 26% did the same. Many contractors are now busy enough with work that allows for sufficient profit margins that they are unwilling to make concessions for certain jobs.

“Second, contractors’ purchasing from big-box retailers are showing signs of plateauing and they are favoring one-stepper and broad-line specialty channels.”

Contractors put the most weight on a product being durable—even before price. Certain “big name” brands, whether in windows (Andersen), siding (James Hardie), and roofing (GAF, Owens Corning) come with brand authority and are reputable for their durability. In contrast, “contractors felt big-box stores lack knowledgeable staff, a reliable delivery service, depth of product selection and several other valuable attributes.” These negatives outweighed the main positive—convenience—for many contractors.

“Finally, they are increasingly integrating mobile devices and tablets into their work and anticipate accelerating their use of mobile software and apps in the future.”

Mobile optimization is important. The ability to quickly access your materials when trying to close the deal or overcome objections could be the difference in making a big sale or losing it. Unfortunately, mobile optimization also takes time to develop—you can’t snap your fingers and have all of your critical online resources perfectly set up for your iPhone. However, it’s essential to recognize where the trend continues to head. You may want to start to think of how your website, etc. can be optimized for mobile devices.

Optimism is a good thing. Optimism backed by facts is even better. Contractors continue to gain confidence in their work and build their businesses, and that’s great news.

 

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