Commercial or Residential?

Choose your “Ingredients” wisely.

When I ask our customers (mainly landscape contractors and asphalt maintenance professionals) if they serve Commercial or Residential customers, they’ll often say “both”. But is serving two different kinds of customers (with very different needs and preferences) the best way to build your business? Is this a recipe for success, or one for disappointment?

It’s all a matter of what you put in, and if you’d like to change, maybe it’s time to think about what “ingredients” you’re using to build your business.

Commercial Specialists

Some larger companies exclusively do commercial work, but they are the exception. Even companies that focus on building a commercial clientele are seldom willing to turn away some of the random residential clients that happen to call, especially if they’re doing under $1 million a year in business.

The Split

As I’ve dug deeper, I almost never find companies that are near half commercial and half residential. And in the rare cases where you do, the companies often have separate commercial and residential divisions that operate independently.

Specialists With Exceptions

Much more often, you’ll find a primarily-residential company that serves the few, random commercial clients they’ve been able to land. Or you’ll find a commercial provider that serves some residential customers either as legacy clients or to utilize workload capacity they can’t fill with purely commercial work.

Who Will You Serve?

From the outset, you have the opportunity to decide what kind of customers you want to pursue, and what kind of customers you will accept. We’ve known lots of people who’ve been willing to accept any job that came their way, especially when they’re just getting started, but that’s not always the best thing to do.

Simply put, some customers are better than others. You can become more selective about the work you do as you build a more successful business, and smart companies will choose the work that’s most lucrative for themselves.

Even companies that pursue customers of all shapes and sizes will end up with more of one kind of customer than any others. Your customer list will gravitate toward a natural sweet spot in your service offerings, and it’s simply harder to build a company that appeals to both equally.

Make a Choice

So take a look at your customers now. Are they the ones you want? Are they the ones you THOUGHT you’d have? … the ones you’re TRYING to have? What would you change about them if you could?

Now ask yourself what about your company has led you to have THIS client list? Is it the way you charge? The way you advertise? The type of work you perform? Your pricing? Your location? Your Size?

And ask yourself what you could change about YOU that would help you attract the kinds of clients you really want.

Good luck ~ the Go iLawn / Go iPave team

 

2 replies
  1. Michael Rorie
    Michael Rorie says:

    Joe I tend to agree with you that most small business contractors struggle to grow their businesses in general . In my 35+ years when observing their profit center mixes one of the biggest divides I see is trying to service business to business customers as well as business to consumer customers . My advice to these companies is and less you’re in such a small market choose one or the other . The talents and competencies required along with the competition will be greatly reduced with this strategy being appled. Here’s to good growth. Mike Rorie

    Reply
  2. Luke McCoy
    Luke McCoy says:

    Great article. At times it can be hard to turn away potential sales, especially being young in the industry. I’d like to see our company take this to heart and maybe change what clients we are pursuing.

    Reply

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