There are always situations where we have little control. One example is the swing of the economic pendulum. In the past 40 years, I've endured several recessions, but never to the magnitude of this one. As I've mentioned, when the going gets tough (financially), building owners and managers look for budget cuts. Unfortunately for both building owners and service companies, maintenance is an area at the top of the "cut" list. This creates a situation where we all must work both harder and smarter.
On the negative side, some of their recurring revenue comes from pre-pay funeral plans and this portion of their business has suffered. More often than not, I'm faced with corporately owned funeral homes with multi-locations, usually resulting from acquisitions and consolidations. This means that decision-making comes from regional or national management, resulting in a more complex and longer selling cycle. However, the volume of potential business can make the effort worthwhile.
COMMERCIAL SERVICE SALES
One way to is to prioritize your prospect list. This is imperative. The economy affects all businesses, but there are some that feel the impact less. Following are some of the more recession-proof industries and a needs-analysis approach to selling:
Nursing care facilities have very definitive and critical needs that puts them at the top of my list. Heating and air conditioning failures are totally unacceptable in these care centers that house elderly and, often times, bedridden patients.
The nursing care industry is somewhat more financially stable for a couple of reasons. First, there is, and always will be, a pronounced need for elderly care. Second, there’s financial assistance available for families who can’t afford to have their elderly in these facilities — that helps keep cash flow moving and dollars available for these institutions to keep up with their mechanical needs. One caveat to this type of prospect: Many nursing care facilities are corporately owned, with multiple locations, requiring some top-down selling. But that’s never a problem, right?
The funeral industry is another that is less affected by the economy. In the broadest vernacular, they're in the same business as we are: comfort. Prosperous funeral homes con¬duct numerous services each week and comfort conditions are critical.
Carrying on with needs-analysis-selling, the medical clinic industry is reasonably sound. I find some doctor-owned clinics are managed by directly-employed management teams. Many of these are multiple locations raising the priority level toward the top. Many others have hospital affiliation or are directly owned by the larger hospitals. Typically, these types of clinics employ rather capable in-house staffing, making them a lower priority.
The tech industry needs close scrutiny on an individual basis. While many high tech companies are suffering and making cut-backs, others are staying above water. High tech companies that receive much of their revenue from govern¬ment projects seem to be at the top of the list. It would appear that our Federal government has an endless supply of capital.
When high technology is coupled with light manufacturing and production, there are more opportunities. Clean rooms, IT rooms, and process chilling always require a higher level of maintenance and will keep some of the smaller service vendors at bay. These prospective customers are not so inclined to succumb to low-bid.
In addition to building the top priority prospect list, your sales team must also address the changes at the lower end. For example, large printing companies have always been great prospects due to critical needs in conditioned air, especially humidity control. But the printing market has been shrinking, according to several of my contacts. Many of their prime customers are still making budget cuts, and are taking much of their printing in-house. With ever increasing computer graphic capabilities, fliers, business cards, and even brochures can be handled without outside help. Printers are telling me that they may never rebound to pre-recession levels.
On a somewhat brighter side, every recession is followed by a flourish in customer needs. Even though HVAC and controls systems are neglected during budget cuts, they don't seem to acknowledge the recession; they keep on breaking and wearing out. Cuts in preventive maintenace programs amplify the problem. Sooner or later the flood gates open and customers start pushing for updates and changeouts. In the interim, all sales people must set their sights on high priority prospects and (just what you didn't want to hear) make even more sales calls. Remember, the cream always rises to the top.
Earl King is the founder of King Productions International, a commercial HVAC contracting sales consulting firm based in Texas. He speaks to associations and trade groups, as well as writing this column for Contracting Business.com. Email Earl with any questions or comments at: firstname.lastname@example.org or call him at 515/321-2426.