Lead Generating Companies
The other day I was driving in my truck and I hear an advertisement from a well-known company offering a place for listeners to go and check up on contractors. Not five seconds after this commercial started to play, my phone rings. On the other end of the line was a sales person offering me the opportunity to get QUALIFIED project leads from folks right here in my work area; all for mere pennies on the dollar! If that is not proof positive that there is a lot of money at stake in the lead generating business I don’t know what is.
We have all heard the heart-breaking story of the single parent or the elderly that gets beaten out of their hard-earned dollars by the mean old contractor. I can already hear some of you saying to me, “Marc, we NEED companies like that because contractors are notoriously corrupt”. If this is your thought process, believe me when I say, you are not alone, but also listen to me when I tell you this is a bunch of hogwash!
Have you ever heard the old saying, “there’s no such thing as a free lunch”? Growing up, I heard that one and many more from my grandfather. I didn’t understand him at the time because granny made me as many peanut butter and jelly sandwiches as I could eat and never charged me a penny for them (well, she would steal a kiss or two). I learned it’s meaning as I got older.
In the referral game, a 3rd party is putting their greedy little mitts into the cash flow. To you, the customer, they tell you it will not cost you a penny for their services, but just as my granny always managed to get her kiss on my cheek, these companies have ways of getting paid without you knowing about it….
Let’s say a contractor agrees to use one (or more) of these “lead generating” companies. Finally, after driving all over 3 counties and talking to anyone that would hold a door open long enough for the contractor to say hello, they get their first “qualified lead”. This means he beat at least 20 other contractors to the customer and the customer actually wants a job done. So, in addition to all the gas spent driving around, and time wasted talking to all those other “customers” that really didn’t want any work done; the contractor now gets the opportunity to “bid” on a job that actually exists – with 20 other contractors! Yea! Oh, and let’s not forget, the contractor had to pay for that lead (and all the other bad ones). Do you think he might be inclined to add a little extra onto your bid to help offset some of his prior losses?
This is but one method that these companies employ to get paid for their services. Keep in mind, they got paid by EACH and EVERY ONE of those contractors that wanted that lead!
And what about that contractor that made it to your door? How do you know they can even drive a nail into a piece of wood? I bet you that lead generating company told you they had those contractors checked out, didn’t they? Folks this is a topic for another day, but the short story is; don’t believe it.
Another “saying” that my grandfather had was, “you have to do your own work”. Most customers like the lead generating idea because someone else is supposed to be doing their work for them! Checking out the contractor to make sure they have proper licenses and insurances. Sending out a quote form for a job and getting the estimates back and maybe they will even offer to come and wash your car on Friday. Point is, don’t believe everything they say. You can do each of these things yourself; here’s how.
How do I research a construction company?
License and Insurance Requirements for a Contractor
Licensing: In the state of Florida, all state certified contractors will be listed on the State’s web site under the department of business and professional regulation. Simply go to http://www.myflorida.com/directory/ and click on the link to “business and professional regulation” and on the next page click on “verify a license”. At this point it’s going to ask you for some information about the contractor; Company name, phone number, the city or county they work in or the license type. If you don’t know the answer to one of these search options, call the company and ask them. Any reputable contractor will have no issues giving you the information.
NOTE: This same process can be done for contractors that hold “local” licenses, however, the process may not be available online. You may need to call the local government agency for verification.
Insurance: This one is the easiest of all. When you have selected your contractor, ask them to provide you with a copy of their General Liability and Workman’s Compensation insurance policies. Folks, we must have these insurances to do our job. I can have copies of these certifications sent to you within a few hours. And make sure you don’t fall victim to the contractor that tells you they are exempt from having workman’s compensation insurance (once again, another topic for discussion)! If you have questions, call your insurance agent and ask; If they don’t know, chances are they know someone that does.
Project Quotes: Now things get a little trickier. For me to provide you with a project quote I’m going to need a bit of information. Which means I’m going to be asking you questions about your project. Which means you need to have spent some time thinking about your project. And, you should spend some time talking to your spouse about your project; I definitely will. The more you know about your project the easier it will be for me to assemble the needed information and provide you with a firm fixed price quotation.
What does a contractor need in order to provide you with a firm fixed price quotation?
- First off, they need to know what you want to do; be specific.
- Secondly, they need to know when you want the job to be done.
- Third, they must know who will be making the buying decision.
- And finally, they need to know what your investment budget is for your project.
I will address each one of these in more detail in later blogs.
When you provide me with definitive answers to these questions, I am happy to provide you with a rough estimate to complete your project. If you want a firm fixed price quotation, we would move to the design agreement which will get plans drawn up by an engineer or architect. I use those plans to prepare a detailed takeoff, solicit bids from subcontractors and material suppliers and get answers to any questions I may have with the building department before construction startsl.
As you can see, there are many steps involved to arrive at the firm fixed price for your job. You have work you need to do and I have many questions that need answers. You should not push this work off to a lead generating company whose only interest is adding more zeros to their bottom line.
When you take the time, you will find there are many qualified contractors out there waiting for your work. I hope you will take that time to look for them because I like to see the good guys (and girls) win.
My best to you all,