Become Good & Profitable at Your Primary Service 1st
All right, so today we’re going to talk about if you’re a custom home builder, and you’re looking to bring some more profitability into your company, you’re looking to bring in an additional revenue stream into your company, how you can do that. Now let’s assume that you already have a profitable construction company. You’re well-established, and you have a solid stream of leads, revenue that is consistent that’s coming into your business and that you have that base ready. Now what you can do is look at how can I increase the value of each customer that we are already building a home for?
Offer Custom Home & Remodeling Design Services for Your Customers
So you’re already providing them with home-building services, and you may already be providing them design services to actually do their plans, but maybe you’re not. So let’s say we’re not providing design services for our customers. We could potentially hire somebody in house instead of sending them out to, say, a draftsman or an architect, and we can do that work in house and create another revenue stream through the design in our business.
Provide Financing for Each Project
Another example would be, let’s say, we’ve been sending out all of our financing needs to a loan officer, or a couple of different banks for each one of our customers we’re building for. They’re generating a commission off of every single lead that we send them. Why can’t we, now that we have a lot of clients, hire someone in house to do that work, or establish a relationship to where we can actually refer work to a vendor and receive a commission? You’ll have to check on guidelines for laws for that because there is some laws that prohibit referral fees for lenders to some degree, but there’s nothing that says that I can’t hire someone in house that’s licensed properly, and that I can actually pay them a salary, and then we earn the profits off of that additional loan that is done. This just increased the value of our customer to our company.
Offer Real Estate Services
Additionally, if you’re a builder, you’re always looking for land so people come in not having land and when they don’t have the land, you could be the person that provides that service and helps them find the land. You can become a real estate agent that helps them find the land and also sell the home that they’re having to sell in order to build their house. So there’s definitely another income stream there that could possibly come into your building company.
Self Perform Construction Trades You Have Been Subcontracting Out
Another option would be that you can do some of your work in house, obviously. You can look at this for every single trade if you have people in your company or someone you can pull into your company that does concrete work, framing work or another trade. You may have been subcontracting that out to another business. You can bring that person into your company, hire them, and now you can receive profits from the framing, or the concrete, instead of subcontracting the trade. So you’re essentially just hiring people to do the work that you already refer to other potential subcontractors or other vendors that are all required to put together the whole package that it actually takes to build a custom home.
How to Think of Ideas for Bolt-On Businesses
So something to think about, a bolt-on business. What is related to what you’re doing already? What are you referring out? Either try to hire that person that can help with that, and then you do that in house or establish some type of a referral agreement with a vendor outside that would allow you to have a long-term relationship to where you can receive some commissions and receive referral money from that relationship. So, all right, hope that helps. It was great talking to you, and have an excellent rest of your day.
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