Empower Your Construction Business with Effective Pipeline Management

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all right welcome this edition of the contractor commute uh my name is Drew Williams here with Ben Walsh founder of congenius and we're going to talk today about uh maintaining a healthy sales pipeline so we've talked about a lot of things in the podcast but today we're going to talk about maintaining a healthy sales pipeline what that means um and to start off actually I'm just going to talk about what is a pipeline for a minute because it's sort of a salesy term some people may like dial in and know what that is but you might be someone who's like what are they talking about pipeline really you know uh something that flows from one end to another and how do you get your prospects and then move them through the pipeline from the person who called or visited your website um or was referral from a friend to that first Contact phone call qualification proposal lead clothes signed contract so if you view all of those things as a pipeline from point A to point B from that's when they start taking your time at the beginning but at the end is when they start paying you money and that's kind of what you want to move them through and figuring out how do you not just get a pipeline but fill the way that you want to so I worked about maintaining a sale a healthy sales Pipeline and we'll start off actually with the you know a few things Ben on what is a an unhealthy sales pipeline look like because there's you know a lot of folks who uh they've got that process going their phones ring and they're working they're busy but they maybe haven't thought about it like what's the health of the actual pipeline itself so we're gonna up front gonna talk through four things uh on what is an unhealthy sales pipeline uh number one is the one that's empty like there's nobody in it yes that's problematic number one uh number two would be unqualified leads like you've got people who are taking your time your phone's ringing but they're not qualified uh you know for multiple reasons we'll get into those details third it's unmanageable sometimes you might have too many people in the pipeline or your phone's ringing more than you can answer it and you're having a hard time keeping a track of you know who are you talking to what what am I doing um and it just it becomes unmanageable and then uh four we're gonna talk about closing the wrong jobs uh which is a I'm sure you've got some stories on that front as well well so unfortunately yeah we'll talk to those four things uh you know um so let's talk about a pipeline that's that's empty or low so um this is you know maybe you've got maybe you're just getting started or maybe you're going from job job or maybe you've expanded right now you've got a couple people working for you and now the pressure of getting the next job lined up um is there and maybe you're working right now but in the back of your mind you're like I don't know what I'm gonna do to keep my crew busy next yeah um it's an empty pipeline so talk to us about uh that you know what is a empty pipeline look like the empty pipeline is the one that keeps us awake at night don't know where the next job's at we have maybe the projects we have lined up we're working on those but what happens next week is so there's obviously a little bit of a stress involved with an empty pipeline or one that's low right I mean it doesn't necessarily have to be zero but we got one person in the pipeline they're kind of kicking the tires still we're not sure when they're going to close we're not sure what their expectations are we're not sure if we even want to work for that person so it could be low enough where we just don't have choices and we're in choices when we don't have choices sometimes we're forced to make bad choices yep well we don't have anything let's take that one person that came in and even though we know that's not ideal that's not the kind of person we're trying to look for so that's an unhealthy pipeline um and yeah you're really at the point where there's just I don't know volume to keep up with your production your output what you can get done yeah yeah if you get a hierarchy of needs right that someone's like hey I don't know how I'm gonna feed my kids right that's a problematic place to be so you know you don't know where the next uh job is coming from so the overhead component as well you've got not just the personal aspect of it but your business the business Health yeah where's that overhead gonna be paid from right um yeah and then having jobs with the right margin when there's not anything to choose from yeah we have that problem so it's probably a lot of time and effort that goes in from the time the in the beginning of the pipe when someone contacts you that they start taking your time immediately um so it takes a while to get them in that Pipeline and moving closer to the time you want your pipeline and your your bank account to be stocked you know but it takes time to move them through to the point where they're actually fantastic you know uh you know paying you so how to make sure you're having the right conversations and you're moving them through that process so that your timing your time and your money correctly to where your time is is full with the right things but also you're you know yeah account balances as well right you're talking about an empty pipeline talking about unqualified leads so that's number two on what is an unhealthy pipeline look like you've got people in it um but they're unhealthy leads uh not all businesses good business we've talked about this in the past um but what's an unqualified lead look like so to preface that the unqualified lead inevitably you're going to have some people in your pipeline at all times that are unqualified but you want to be able to sort through those quickly at the early stage before they fill the later stages of your pipeline when you're trying to close jobs where people that aren't qualified so we want to be able to quickly get to the point of figuring out whether somebody's qualified and the and what that looks like in an unhealthy pipeline is we have a lot of people we're actually entertaining working for because there's really not the volume we need so it kind of ties back to the first point the low volume so now we have a bunch of people in there because we need people in the pipeline we have a bunch of people that are unqualified and what that would look like is just you know the wrong budget expectations uh you're the Macy's contractor their shop they're thinking they're shopping at Walmart uh they're two hours away and you only want to work 10 minutes away from your shop uh it could be even the scope of work they want a project done that you don't have the resources to do or don't want to do right so a lot of reasons for somebody to be unqualified and if your pipeline's filled with those types of projects well I guess I'll try to you know to accommodate this person hour and a half away because there's nothing else right yeah standard lowers right and then you end up yeah you know I think we talked about in the past but you end up working on unqualified leads um one again those people are taking your time immediately and you may never get paid for it because the fact that they're not qualified means but you know people will shop uh and take your time with no intention of ever doing business and figuring out how to understand if this person is qualified or not uh it's it's important it's strategic but I've noticed that people who don't have money generally have a lot more time and they have no problem wasting your time as well when they never intend to give you money you know um that's the person who will sit there in bigger back and forth over a five dollar fee or you know that sort of right it'll take the time to sit on hold with customer service with whoever or talking to you and having the eighth conversation of your time they need at the end of the day they're not qualified and the sooner you can figure that out you know some of the most demanding clients I've had were the ones that were also the cheapest yeah right yep yeah everyone's got you assets time and money and they uh they generally are good at wasting both um I'm thinking of people but I'm not gonna name them by name right now because you know we shall leave the everyone's got a person in the mind right now that waste time waste money they have no problem wasting yours as well yeah right so three things an unhealthy pipeline one is empty your load two it's unqualified the third one is unmanageable uh where you've maybe got um you know you think about a pipeline they have certain widths to them right like you might have a small capacity but you've got more people trying to come through that pipeline than you know what to do with and all of a sudden you're you know you're late you're not managing it uh you missed phone calls Etc so talk to me what is an unmanageable pipeline look like this is going to change depending on your business your scale Who's involved in your team in your sales process you might have an estimator sales person person doing takeoffs so that pipes bigger for you you can handle more volume to get jobs closed but it also might mean the you actually need to close more projects so that pipe is a bigger pipe you've got more to move through it the unmanageable pipeline the unhealthy aspect of that is going to be where the client experience is poor people don't get the service that they're really expecting the timeliness of getting back to people it's a pressure point for you it's just oh man I've got all those bids to get out I just when's that going to happen um you know it's months later people are hounding you to get quotes um you know it could also be where it's just overwhelmed the overwhelm yeah you know to the person as a business owner where uh you just don't I can keep up with it right so that's unhealthy I mean it's unhealthy for you as a individual it's unhealthy for your company and then the other aspect of it would just be where if you can't manage those jobs to get them towards a close you're gonna end up having a situation where you can't close jobs because you can't get the qualified people that you want to work through to the close because there's all this other clutter going on right you don't know how to Cipher you don't want to filter out who's the people who are the people you want to work for how do you get those jobs to close yeah yeah yeah and again moving them through the pipeline right you don't want people hanging out in the middle of that where they're interested they you've looked at their job you've given them a quote they're just hanging out you know you don't want an overwhelming amount of people in that process right at the same time and then back to your point the time wasters I mean you end up spending more time trying to trying to get jobs to close that maybe you shouldn't have so it's a very it's a very unstructured and very laborious right difficult weighty process yeah that's unhealthy yeah I think we've you know we've been there right yeah I see that pain in your eye yeah man the fourth one we talked about is closing the wrong jobs so um which you know I think we've probably all done I'm imagining you've got a story or two on closing the wrong job you get someone through this process all the work and then you close it and then you realize it's the wrong job so um not all work is good work that's a hard lesson to learn um but what is it like when you close the wrong job well obviously there was a breakdown in the process earlier to this where the wrong person was qualified you qualified an unqualified lead yeah somebody came to you looking for something we said well we need some job let's go ahead and just lower the the standard yeah except something we we probably wouldn't otherwise have accepted um you're closing the wrong job really comes back to you is even understanding what the right job is for my team and for my business and what do these margins need to be so you end up closing jobs without a lack of without the real the data you need to know but what you do know in an unhealthy sales pipeline is you close the job that ended up hurting your business so the result of it was I've got a job that I wish I hadn't sold that's unhealthy yeah yeah very unhealthy what are some common uh reasons that happens like what's the trigger point where you're doing the job and you're like this was not a good idea is it the customer is it money is it just a scope what are the types of things that that we tend to overlook yeah as a technology company we use a term called technical debt and it's essentially you put so much into something and you can use this in any business where you're saying you know it's not an ideal solution but we've been using it so long we put so much money into it let's just keep rolling with it yeah and there's a certain level of debt you have to a client where you feel like I've spent weeks trying to close that I put all this time into this so let's just obviously it's not ideal it's not something that's probably going to end up working out the way we want but you have this feeling of let's just keep going with it it's not yeah it's not what we otherwise would have chosen right so there's a level of wanting to keep your word wanting to keep your commitments wanted to do what's what you more or less promised that person or with the what they have have expected it from you yeah whether they should or not right and you're you got to that point in the pipeline you knew this is a process right you walked with this potential customer all the way through it you spent time at this point you probably went to their house you took your measurements you got a proposal out and the whole time you knew these people lived an hour and a half away from where you like to do work well maybe they were a friend but you're now you're feeling it well okay I went through all the work I I got to do this job not realizing that extra commute time is actually going to kill your profitability or your ability to get it done on time you know but it's like yeah you end up too far in you know um a lot of that type of situation yeah you close something that you probably should have been talking to begin with and if you had a healthy pipeline process you would have known that early on cut off ties said no which is you know something we're talking about too is you know the ability to say no uh early on instead of investing investing investing investing you know and then you close something that you probably shouldn't have closed you know so it all points back to where it all started yeah as we some these are very interconnected aspects of unhealthy pipelines and the culmination is jobs we shouldn't have had right time wasted people we've invested a lot of resources and even if it didn't result in a close we still spent a lot of time yeah trying to close the wrong deal and that's why you know why people go out of business why they end up behind all trying to catch up all the time is is these things a lot of times you don't think about it you just go and we stay busy we stay active but right like activity doesn't always equal achievement and a lot of times we're very active we're busy but we're not actually prospering right so now that everyone's totally depressed out of their minds he's like yeah it's me man yeah yeah I think now that we're all uh fairly depressed because I think we've all been there right this is this is relevant because it's easy to get what we're talking about doing and so um let's get into like why you actually need a healthy sales pipeline so we're gonna um talk about what does a healthy one look like uh here and then I think eventually where I get into like how do you go do it right so this is where we can kind of shift into okay what does it look like to have it be healthy and then how do you how do you get from point A to point B if you are that person with a lot support things we talked about you're like yep that's my life um let's get into it so learned about five things on why you need a healthy sales pipeline um so I'm gonna hit these five up front and we're getting kind of talk about it in more detail here but now the first one on why you need a healthy sales pipeline is to be able to accept the working clients that you want instead of just what's available at the time and so that's one the second one is having a steady Revenue stream that allows you to have a healthy bottom line so we talked about that process of people coming into your business and customers coming but also having a healthy flow of money coming in right where it's not up and down not feast or famine but a healthy flow of money uh coming in third one is keep your team and subcontractors busy right uh so that's that's the goal right is to keep it and as you grow uh you're gonna have to have a team you know if you want to have long-term success in this business you got to go beyond just you and the truck you're gonna end up building a team um and to keep that team happy you got to have the healthy sales pipeline uh fours know what's coming up and be able to plan for it uh and then five is having the ability to grow so those are the kind of the Big Five on like why you need that healthy sales pipeline um but let's talk about let's get into those five and say hey what does it actually look like so those are easy things to say but there's a lot more detail that goes into making those things a reality so um if we talk about having the right amount of volume not too empty which is no business not overfilled where your run and dragging is trying to keep up uh what is it what is that healthy sales pipeline look like when we have a healthy sales pipeline we have the when we talk about volume going through this pipe figuratively speaking Yeah we there's a lot of pipe references that we're going to stay away from the plumbers are very happy right now yeah well we have a pipe just fully garbage yeah um yeah so that we have a limited capacity to be able to handle a certain a volume of people coming to our business every business has this sort of limit of saying that's just too much or we're concerned because there's not enough coming through it and really it's kind of weeding out I mean we can talk about we're going to go into the why later but it's really kind of this this healthy sales pipeline looks like I've got the right number I've got the right ratio of people moving through here that are it's a healthy when we talk about even physical health antibodies and our you know our bloodstream Etc you know there's just the right balance of positives and negatives in this pipeline while we're moving the right leads through um and we've got you know not this overwhelmed we have to keep up with we can sort of be able to say no to the right people say yes to the right people and so yeah there's there's enough people coming in where we can be out as far as we need and this can look different for every business right I mean yeah somebody's going to need more volume than others or there might be a special a specialty where you end up having to weed out a lot of people yeah so that volume might need to be higher so understanding what that metric needs to look like yeah and knowing your capacity yeah and if you want to upgrade your pipeline that which is growing the team now maybe you do a full-time sales person or uh marketing or whatever you've got you're trying to increase the size of your pipeline uh making sure that what you're bringing in from a volume standpoint you also the capacity to serve yes to serve well so we talk about volume let's talk about quality so the volume of what's coming through the pipeline the second thing is the quality of what's coming through it um and we say like you know talking about getting qual only only quality leads get past qualifying right um I think that's a lesson that you got to learn the hard way normally too is what does it mean to qualify a lead you know there's probably people listen to right now or someone's like I don't even know what you mean by qualifying the lead you break that down uh what is that you know how do you do that so simple in theory but somewhat difficult to execute on and quality qualifying in order to get quality as you pointed out is really about understanding the parameters in your business that really identify the ideal client you want to work for and there's a couple of really core aspects of that the location's a big factor the scope of work and sometimes we leave these things undefined in our business on purpose because we realize well the pipeline's constantly going up and down so let's leave ourselves some room to be able to make exceptions let's accept some people that we would otherwise would not work for so we almost hesitate to make these kind of confirmed rules in our business of saying not that's an unqualified person yeah and so we sort of dilute the quality of our pipeline because we make these sort of exceptions well that person you know I like them they're you know we want you know want to help them out sometimes you can make exceptions yeah but if that's modus operandi that's the way you run your business it can feel kind of counter-intuitive for a business owner um to say hey I'm gonna go be a business owner and go generate business and create and then then to say well I don't want that type of business because early on especially what like you Temptations just to get whatever you can get and um it feels almost counterintuitive to say no uh it's a business based on quality and we have to understand some real problems that happen if we go that direction we don't do that type of work but we're going to make an exception and try it anyway and so you have a team that's frustrated because they can't really meet the expectations of the client because they don't have the experience or they don't have the resources to be able to do it uh and so that's a big problem bad review you know unhappy client because you weren't set up to do that yeah the other thing's budget somebody comes along saying I want an amazing deal I mean I remember one time somebody calling and saying uh why don't you look at a project obviously you make the time make the initial connection this person came back and said well uh bit it like you were you know this was for Grandma never thinking actually my grandmas would would probably give you quite a you know she would pay for this yeah so that'd be different yeah she would pay a premium right because I was a grandson but um you should get those red flags yep this is not a quality candidate doesn't align with where you're at as a business and knowing what what even the price points need to be uh something was really um you know well we can get into why later but I'm I'm very off topic I want to jump right into Solutions yeah so yeah healthy would be uh really having that quality when you have the location the budget scope of work really clear yeah I think it makes sense yeah talk about budget time scope quality you know can can you meet or exceed their expectations yes on all of those yes because and it's probably you know like having that checklist of hey here's what we here's what we look for in the type of work that we're doing so if it's healthy that means that one we've got the volume coming in two the quality of what's coming in we're we're happy with we feel like we're investing our time and things that could be good profitable jobs for us there's nothing coming down that pipeline that we're like oh shoot I kind of hope I don't have to do that one you know you want to keep that standard high right yes um and then that one is you know keeping your sales pipeline uh manageable right so uh depending on you know the resources and the team you want to have a manageable pipeline to where you're also not overwhelmed um that would be you know another another thing to get into so you know the the volume the quality and then can you manage it yeah and in a healthy pipeline that means the clients experience is exceptional people get quick turnarounds when they're looking for pricing they're looking for information from your business you're able to turn it around quickly it also means that uh the expectations that you brought up are defined really clearly what people know what the quality looks like in your business what the price point looks like in your business where you're able to really turn around a very client-centered experience where people's expectations are well the expectations are clear and you're able to meet those expectations I mean in a nutshell that's what it's all about um the next steps are defined you know where you're saying this is our this is our pathway here's where you start here's the timelines here's what the next steps are so in more detail I guess a healthy python would really end up being where the communication is great the time witness is great client experience is excellent because you're able to manage all of the leads well you end up only moving the quality leads through so you got quality and now you end up be able to meet those expectations yeah yeah I think you talk about even the goals and like how far out do you want to be booked out yes that's interesting for everybody too I would think well yeah I mean it might even be hard to try to schedule things out a year from now I mean it's almost impossible to try to hey on December 12th of 2023 we will start your project right you know it's it's hard to really predict that far out but the healthy part is really where you have the confidence of knowing the right jobs are coming through you're managed you're managing it well yeah and some of these early concerns of are eliminated right yeah and ideally you got you know volume quality that customer who maybe you are booking out a year in advance I mean I know guys who do this where it's like hey they're you're out and that's just the system that they've got that works but they also know if this customer really wants us and willing to pay the price that we we want to charge they'll wait a year because they're committed to us and it's you know we're the right we're the right match you know um so yeah yeah the manageable is your client expectation is excellent but I'd also think it looks like your sanity levels are better as well right you're not just your systems and process in place where because you've got good volume that's held either qualified you you're sleeping tonight because you know that every phone call that you're making or every potential customer you're interacting with you feel good about you're like this is a job I want to do um we we know that they're that they'll pay us we know it's going to be a good job we know they're going to pay on time um you know their their expectations are clear and I think when you do that you're investing your time into something that you know is going to be profitable and valuable to you and I think that's where you sleep in and you didn't clog the pipe with a bunch of projects that you didn't want to do right the pipe has limited volume you can only get so many leads through there yeah and once you start lowering those standards making exceptions getting that thing all full with a bunch of leads you just can't manage they end up having the result of it being well look at that I don't I can't take on that job that I really want to take on because when they want it done I've got somebody else that I'd rather not work for already on the books right and they're already on the schedule and they're probably already high maintenance you know this you know you can't call them and delay it again you know there are people who are going to hop on the internet and you know tell the world how terrible you are it's like oh I just gotta I gotta deal with it you know yeah um and there's I know we're going to get into more on how you actually build that because we're okay here's what it would look like you know but there's some practical things we're going to talk about later on what do you do and I think this is an important one of you know qualifying and managing that pipeline um there's some some how-to's we'll get into yeah and going back to just the the motivations behind it and really the goals for you know that that whole why you need the healthy pipeline uh you know what you what we started off with just being able to say these are the people we want to work for these are the jobs we want we have the revenue stream we want to have and then one of the key things too is you have no ability to grow if you're stuck you're trapped you can't manage where you're at today yeah if you don't have margin to be able to take it to the next level you just stuck yeah in the current spot yeah we've been there I mean you know where you just today there's no way to get Beyond today because it's overwhelming just to keep up with what I've got going on yeah you've unintentionally dug yourself a niche that now you can't get out of yeah you dug yourself and word gets out to the people that refer if you start taking on the wrong jobs they refer you to the wrong people as well and you just it just snowballs out of control sorry we're going all negative again but next episode we can talk about how we actually solve some of these these core pain points it's true though like people are who they hang out with bottom line yeah you get someone who's high maintenance Jeep whatever the people they hang out with are the same way you know and so get in the right circles is pretty key but you'll never get there if you just if you if you're not intentionally thinking about this concept of the pipeline uh you're never gonna get there you're just going to be reacting to the market as opposed to proactively defining your brand and getting after who you are what you who you serve the type of work that you do and I think uh being intentional about that especially in the early days uh is very very important so um we're gonna wrap up this episode and we're gonna get into another episode where we talk about the how to's on some of this stuff and so I think uh kind of the goal of this episode was to get people to think about what is my pipeline like do I have a process for this or is it just kind of answer phone calls and emails as they come in do I have a clean way of moving people from stage to Stage to Stage through this pipeline um and then getting them to close um so I think you know what is a pipeline uh what does it look like when it's unhealthy we talked about that and then what is it like when it is healthy I think that's like the you know if we were too negative like that's the hope and it's like you can create this like guys who get real successful in the space have a very actually clean simple process that they use to make sure that they're only doing work they feel good about doing but that didn't start with on the when they're on the job that started with when they answered the phone the first time um and that's where you know if we can if we can just get that pipeline rolling you'll end up doing the work you want to be doing making the profit you want to make and working for customers that you want to be working for but can't wait to dive into it it's gonna be really fun yeah looking forward to it so that's a wrap for this episode of the contractor commute uh again Drew William we were Ben Walsh founder of congenius and we will see you next time on the contractor commute [Music]