Success In - and Outside of - Vendor Programs
by Brent Bowthorpe, Delta Business Solutions and Planning to Win Instructor
Trying to determine if vendor programs are right for your restoration company?
Some companies have gone after vendor programs and lost their shirts. They thought they had something great going, and suddenly realized it won't take them where they want to go. Others have found great success in vendor programs, and there's a third group that sits on the fence. Our objective is to get you off the fence and help you determine where you want to go.
Vendor programs have a broader impact on this industry than many of us recognize. They've impacted this industry in positive and negative ways. They brought conformity and uniformity to an industry that was very fragmented. Subsequently, the way this industry works has been greatly streamlined. Contrarily, many contractors have experienced some of the inexplicable expectations carriers can have and many of these are inflated within programs.
We tend to look at vendor programs only from one of two perspectives:
- Am I on the programs and getting business? Or,
- Am I not on programs and fighting to keep the jobs and not have them taken away?
As mentioned many companies have put tremendous effort toward getting on programs only to find they created more problems than they solved. If you think you can get on the program and everything's good, you're wrong. In fact, your marketing focus will differ based on whether you're on or off a vendor program.
- Marketing within a program, what they want is clearly written in the contract; you must master the business skills the program calls for. There are time ranges, pricing agreements and service processes that are part of every program.
- Marketing outside programs requires a skill of identifying market groups, finding out what your market wants and giving it to them; in other words, solving problems your competition does not.
There are highly successful restoration companies around the country that specialize in everything from agents or plumbers to medical facilities or schools. The problems that each of these groups have are different; the ways companies serve them are different. Those who want to market outside of programs know this: There are huge opportunities outside of programs. In fact there are more opportunities outside of programs than there are inside of them. A contributing factor is the fact that most of the restoration companies out there do not recognize or understand that.
If you believe vendor programs are your only solution, you're looking at it narrowly because they are really a small part of the industry. Programs exist primarily in residential and rarely in commercial. In looking at the disaster repair industry as a whole - commercial and residential - the reality is, only a small percentage of claims are going through programs. Claims histories show that the number of claims is divided fairly equally among all three groups: those running through programs, contractors outside programs and home owner do-it-yourselfers.
If you think a vendor program is what's best for your business, investigate first. The worst thing you can do is think that a vendor program is a quick fix to a poor business and marketing plan.
- Evaluate if programs really fit your business model
- Programs are highly structured and require a business model that supports both the organizational and the philosophical structure necessary to make them work.
- Does your current marketing put you in a position of support with carriers?
- Do your future marketing desires fit in with VPs?
- Determine their requirements and what the expected volume of work would be.
- Talk to peers you trust.
- With a few connections you should be able to find people working on the programs you are looking at in other markets around the country.
- Make sure you understand the requirements and expectations and evaluate your business processes.
- You should be able to meet the requirements of the program before you are ever on it. (One of the easiest ways onto a program is to outperform their current contractors when you handle a claim for that carrier presently.)
- Remember, to be successful with a vendor program you must master the process of business skill.
Your financial success will be dependent on your ability to operate an efficient process on jobs.
Regardless of your decision about vendor programs, when industry changes occur, it's critical you accept the facts. A couple of a quick reads we suggest:
- Who Moved My Cheese? by Spencer Johnson. It's about learning how to accept the facts.
- When you see a market changing don't fight it, don't complain about it, say to yourself, "The cheese has moved, let's go get it!"
- Look Ma, Life's Easy! By Ernie Zelinski. It explains this easy rule of life:
- Do the easy and comfortable, life ends up difficult and uncomfortable.
- Do the difficult and uncomfortable, life ends up easy and comfortable.
These are the reasons people are successful; because they've accepted the facts, and they've made the difficult and sometimes confusing moves.
This market is changing rapidly. The facts are this market place is being divided and controlled by insightful contractors all over the country and this goes far beyond programs. Planning to Win has established a marketing program to help you understand just how these markets are being divided and how to truly monopolize on what is going on in the restoration industry today. You can be a powerful force in your market place when you understand what is going on. Sign up today!