# What percentage of your business comes from repeat and referrals?



## copusbuilder (Nov 8, 2005)

George Z said:


> Take a walk on the wild side?
> 60% new business, very exciting, lots of possibilities.
> Relying too much on referals, expectations, friends of friends and all the other bothersome junk,
> tie you down too much. It would be too much like having a job.
> ...


C'mon George, near 100% new business means more time for you and your family. 
Chase kids not phone calls. Or...maybe grandkids:laughing: 
Spend time with the wife not the wasted leads?
Who wants more painters hanging around...I try to loose mine a.s.a.p.
And the biggest question???Have fun with Certa Pro


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## copusbuilder (Nov 8, 2005)

George Z said:


> No.


Yes, yes , yes..It's for your own good:laughing:


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## George Z (Dec 23, 2004)

copusbuilder said:


> C'mon George, near 100% new business means more time for you and your family.
> Chase kids not phone calls. Or...maybe grandkids:laughing:
> Spend time with the wife not the wasted leads?
> Who wants more painters hanging around...I try to loose mine a.s.a.p.
> And the biggest question???Have fun with Certa Pro


My family is the field manager.
Grand kid not here yet, but coming up soon.
Certa Pro? Nice company.
I work less than a normal week anyway, I just happen to love what I do.


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## cmwacasey (Aug 13, 2006)

Good thoughts for both sides.I am so tied to old customers and referals,that it is hard to find time for new ideas.So many customers in Houston 7 years ago,that I was glad to get away to the country.Same thing is still happening now in the country.Take care of your customers and life will be CRAZEY.note --- I am good at what I do[so they say} But I am no business man.I am happy and love my job.


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## cmwacasey (Aug 13, 2006)

I was told one time that I need an agent.Any thoughts from the business people.


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## MarkNoV (Apr 29, 2006)

First year in business was close to a 100% repeats and referrals. I was running all over town, making money one day and giving it away the next doing stupid little jobs, just to keep a customer happy, and get more referrals.

Now, seven years later, I don't ask for or accept referrals, spend $1,500/yr on advertising, work only in my immediate area, only windows and doors and concentrate on my margins. Materially, my life has not changed much, but I am working less, and have more time to spend with my wife and kids.

Mark


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## sausagebarn (Sep 9, 2006)

I have been in biz for 8 years and all with repeat and referal (except one very horrible client).
I'm with Gorge Z though. I am implementing a marketing plan (soon) with the hopes of making a real biz out of what I have now; a project manager for hire with 1-3 employees. :thumbsup:


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## Melissa (Feb 23, 2006)

GeorgeZ said:


> I am sure any self respecting business can include 5-8% for marketing in their overhead. If not, something is wrong.
> Just my opinion only


Well, it is just my opinion that any self respecting business wouldn't find anything wrong with GOOD FREE advertising!!



GeorgeZ said:


> I just like when my phone is ringing.


Our phone is ringing too. Just submited one proposal and met with them over the weekend and have another new estimate scheduled for tomorrow, which is coming from a referral by a contractor we've never even met. He just happens to know a vendor we know and trust and called and asked if it's okay to send jobs our way every now and then! 



GeorgeZ said:


> If a neighbour paid 10,000 and their friend expects the same.(They definitely expect the same when you screw up on your price) My next phone call could be an opportunity to make 13,000 for the same job.


Every job of ours is completely different, different desigers, layout, budget, material, etc. Prices go up, and we still get the job.



GeorgeZ said:


> More new customers, opportunity for more referals right? Don't get me wrong, we have a CRM program in the works,
> I just like new and exciting


Hey, we like new and exciting too. And we get just that. Just because it's next door to the house on the beach, or anywhere for that matter, doesn't mean it's any less exciting. 

Listen George, I love a good debate, and I love to learn new things. So please tell me what is wrong with what I listed above? Or are we the exception? Our customers are very cool for whatever reason, and they would never refer us to some a-hole on their block. We have the perfect system. :thumbsup:


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## copusbuilder (Nov 8, 2005)

I think referral is the way to go. The problem with some people is they are getting referrals because they are easy to control and manipulate.
If you can get the business to where people think "It will cost you more but the job is great and you don't have to play games" then the referral business is unbeatable:thumbsup: 

When I decided to downsize I kept the good and dumped the bad. Got rid of the bad employees and kept the good. I have an incredible amount of free time, little stress and no late night or weekend meetings.
The majority of my work is repeat. 

I refuse to show and give bids to shoppers that are putting you against everyone else they could get to show out of the phone book? 

Use your time wisely, maximize profits, fnd out what is most important in your life...Sorry George, getting a rush out of the hustle bustle isn't healthy in the long run..


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## copusbuilder (Nov 8, 2005)

Interesting results on the poll totals?

Seems the silent majority prefer to run their businesses using referrals?


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## Richard (May 21, 2006)

cmwacasey said:


> I had our kids hand out circulars in the neighborhood i lived in at that time.That was eighteen years ago.I have not had a day without work since then and it has been 100% referals


Not too many people can say that:blink: ....good for you!


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## Richard (May 21, 2006)

copusbuilder said:


> C'mon George, near 100% new business means more time for you and your family.
> Chase kids not phone calls. Or...maybe grandkids:laughing:
> Spend time with the wife not the wasted leads?
> Who wants more painters hanging around...I try to loose mine a.s.a.p.
> And the biggest question???Have fun with Certa Pro


~sorry you dont like painters that much...must suck for the painters in your area to have another tradesman with preconcieved notions about them...

I try and give everyone the benefit of the doubt...


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## copusbuilder (Nov 8, 2005)

cmwacasey said:


> Good thoughts for both sides.I am so tied to old customers and referals,that it is hard to find time for new ideas.So many customers in Houston 7 years ago,that I was glad to get away to the country.Same thing is still happening now in the country.Take care of your customers and life will be CRAZEY.note --- I am good at what I do[so they say} But I am no business man.I am happy and love my job.


When I moved to Crockett ( a small town of 7000) I took and add out in the local paper. Semi retired Houston contractor ...I received a lot of calls and did a few jobs.
The problem with a small town is they operate on control. Those with the money know how to keep it and manipulate people to do as they wish.
I found that people were impressed with my profesionalism and quality of work but seemed unwilling to pay? 
They still wanted to hire the Walton boy down the road that sucks at what he does, but they know his Dad from Church? My work out here will be limited to building spec homes and you either buy it or don't:thumbup:


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## George Z (Dec 23, 2004)

copusbuilder said:


> Interesting results on the poll totals?
> 
> Seems the silent majority prefer to run their businesses using referrals?


I know, isn't that great?
More business for me


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## George Z (Dec 23, 2004)

Melissa said:


> Well, it is just my opinion that any self respecting business wouldn't find anything wrong with GOOD FREE advertising!!
> 
> 
> 
> ...


Melissa, marketing is more than advertising so I hope you are still
marketing with referals. (signs, t-shirts, training for customer service, maybe a website, business cards, networking expenses, 
and the big one: *going the extra mile to get the referal.*
That last one is way more expensive than 5-8% advertising.
I have been working mostly on referals for 15 years. 
What a wasted opportunity!
This is a metropolitan area of 4 million. Marketing to it is fun.
Working for the Smiths, their friends and neighbours is too much like a job to me.
Besides I am not a painter anymore, I just run my business.
I have plenty of time to do what I love.
Again, nothing wrong with referals, just too limiting.


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## Melissa (Feb 23, 2006)

George Z said:


> Melissa, marketing is more than advertising so I hope you are still
> marketing with referals. (signs, t-shirts, training for customer service, maybe a website, business cards, networking expenses,
> and the big one: *going the extra mile to get the referal.*
> That last one is way more expensive than 5-8% advertising.
> ...


The phone rang again today. The realtor I mentioned above referred us for another job, this time in a different neighborhood- one of the richest in the county, that we haven't done any work in yet. So, it should be fun, new, and exciting :thumbsup: 

I don't know why you say referrals cost money too, we haven't paid one cent. I've been thinking of a thank you gift, we'll see. We get referred because people know our quality of work and many other factors that people like about us. 

So, it doesn't mean we have a "job" just because we're remodelling every single house in a community. What it means instead is that people trust us, like our work, and want US to do the job for them vs some other company that is brand new to them. And we're happy to do it, because we like the neighborhoods, like the people, like the scenery, and the money's all the same regardless :thumbsup:


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## Melissa (Feb 23, 2006)

Let me ask you one simple question George and you will see that I'm right.

When someone sees your advertisement, and you go look at the job, don't you give them *references* to call? 

It's basically the exact same thing.


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## mdshunk (Mar 13, 2005)

copusbuilder said:


> Interesting results on the poll totals?
> 
> Seems the silent majority prefer to run their businesses using referrals?


The 80/20 rule persists in all cases. Isn't it interesting what it shows us this time? I have to believe George Z and Marc (two guys, with whom I am normally hesitant to agree with) are on to something. Granted, if you have all the work you need, it makes less of a difference where your work comes from. If you need increasing amounts of work... well then. I have to think that the closing ratio will be marginally higher on a referral lead than an traditionally harvested lead.


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## copusbuilder (Nov 8, 2005)

Paintguy26 said:


> ~sorry you dont like painters that much...must suck for the painters in your area to have another tradesman with preconcieved notions about them...
> 
> I try and give everyone the benefit of the doubt...


WTF are you on about


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## copusbuilder (Nov 8, 2005)

mdshunk said:


> The 80/20 rule persists in all cases. Isn't it interesting what it shows us this time? I have to believe George Z and Marc (two guys, with whom I am normally hesitant to agree with) are on to something. Granted, if you have all the work you need, it makes less of a difference where your work comes from. If you need increasing amounts of work... well then. I have to think that the closing ratio will be marginally higher on a referral lead than an traditionally harvested lead.


Maybe I am confused?? What does that have to do with the polls showing the majority of people responding have primarily referred work?

I agree that if you TRULY need extra work then advertising is needed. The question is how many people go out, grab what they can, mismanage what they have, show mediocre profits at best and take jobs off the table for others?
Many times a well organized smaller business will outperform a larger co. in all ways except size. 
Like I had posed to marc one time. I would rather earn 20% of 500,000 than 10% of a million. This is something many people don't see because they will not take a breath and look at their co. and/or lives.


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## john elliott (Oct 23, 2005)

Is there some way you can actually _choose_ to have referrals then?
In my case the phone rings, it might be a referral, it might be someone who's seen one of our occasional adverts, it might be someone calls into the workshop/showroom having noticed our roadside sign, in any of these cases I'm going to quote them for their job.
I suppose what the guys who work on just referrals mean is that they don't do any advertising and therefore all their work is referral based.
I don't get any repeat business at all, not likely too either until someone I've done a kitchen for moves and wants a kitchen for their new house- trouble with that is that I am continually raising my prices. If I did a kitchen for them 3 years ago then they are going to have a nasty surprise

John


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## George Z (Dec 23, 2004)

_"Many times a well organized smaller business will outperform a larger co. in all ways except size"._

*Many times a well organized bigger business will out perform a smaller disorganized co. too*

What exactly does that mean, we need apples to apples here.

I don't think with advertising is the only way to run a business.
It works for us. I can turn the tap on and off when I want, and watch the money come in.

Guys, I think you are happy doing what you are doing and seem to be successful at it.
My point is: Some compoanies in this world advertise.
I bet you that's ok too. 
I can think of couple that make some money.


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## Melissa (Feb 23, 2006)

I still want to know why Michael Stone and many here say that most of your business needs to come from advertising??? I've been meaning to post about it since I read the transcripts from the chat. 

Here are some of what he said on this topic:



> 08/31/06 21:51:28 MCStone: For those that are interested, your referrals should be 15% to 25% of your leads in the door, not any more than that. If your referral rate is higher, you are not doing a good job of advertising.
> 
> 08/31/06 21:55:21 MCStone: Those that work by referrals and don't advertise, will never know how much good business they never got because they refused to advertise. Referrals should be the icing on the cake, not the cake.
> 
> ...


Does anyone care to elaborate, or should I just let it go. I'm thinking maybe it doesn't apply to us for some reason, because it makes no sense to me. I thought the goal was to create a niche, find your target market and get in good with them and you're set.... which is what we've done. (and now we just need to fine tune our other areas)


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## George Z (Dec 23, 2004)

Melissa said:


> I still want to know why Michael Stone and many here say that most of your business needs to come from advertising??? I've been meaning to post about it since I read the transcripts from the chat.
> 
> Here are some of what he said on this topic:
> 
> ...



_MCStone: Those that work by referrals and don't advertise, will never know how much good business they never got because they refused to advertise. _

That's the answer.
You will never know ever


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## MarkNoV (Apr 29, 2006)

Malissa
I think what Mr. Stone is alluding to is that by relying on referrals you effectively allow customers control of your business. The danger with niches is that they are hard to climb out of.

I think this is what George Z means when he describes working for Smith and his friends as being a job.

Mark


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## Melissa (Feb 23, 2006)

George Z said:


> _MCStone: Those that work by referrals and don't advertise, will never know how much *good business *they never got because they refused to advertise. _
> 
> That's the answer.
> You will never know ever


Um, yes I do know, because I've placed advertisements before and it's not nearly as good as when people are referred to us. 

What do you think MCS means by "good business"? It could have a different meaning for everyone. IMO we already have good business, so.....


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## Melissa (Feb 23, 2006)

MarkNoV said:


> Malissa
> I think what Mr. Stone is alluding to is that by relying on referrals you effectively allow customers control of your business. The danger with niches is that they are hard to climb out of.
> 
> I think this is what George Z means when he describes working for Smith and his friends as being a job.
> ...


Why is it suddenly a "job" when you work for the Smiths and their neighbors? Are you suddenly their *****, because you do quality work and people want you to remodel (or paint) their kitchens too? :laughing:

Also, they are absolutely not hard to climb out of- we are in control of our business, if we ever didn't want to do work for someone, then we just flat out wouldn't- it's not that complicated.


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## Richard (May 21, 2006)

Ok.....who pissed off Melissa first? ...:laughing:


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## copusbuilder (Nov 8, 2005)

Melissa said:


> Why is it suddenly a "job" when you work for the Smiths and their neighbors? Are you suddenly their *****, because you do quality work and people want you to remodel (or paint) their kitchens too? :laughing:
> 
> Also, they are absolutely not hard to climb out of- we are in control of our business, if we ever didn't want to do work for someone, then we just flat out wouldn't- it's not that complicated.


Melissa, I think you are on the right track. Many of us do not beleive that more work ='s more money. Most times it is more headaches.

I respect those that do and have done that road before. I beleive it makes more sense when a co. specializes in paint,roofing,siding etc.
Remodeling is a different story?
I just got to a point where I chose the work I wanted instead of taking what made a few extra bucks. 
As always George, It is good to see different perspectives:thumbsup: 
If you truly enjoy it then more power to you...


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## MarkNoV (Apr 29, 2006)

> if we ever didn't want to do work for someone, then we just flat out wouldn't- it's not that complicated.
> 
> 
> > You would tell Mr Jones, who was referred by Mr. Smith "no, not interested" knowing that Mr.Jones would get back to Mr. Smith, and Mr. Smith would stop referring you?
> ...


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## Melissa (Feb 23, 2006)

Paintguy26 said:


> Ok.....who pissed off Melissa first? ...:laughing:


:laughing: 

No, I'm not pissed off at all, not even PMS'ing! :w00t: :no: I'm just trying to understand the point of view of not wanting referrals. It baffles me. Sorry if I sound too intense. :blink: I'll chill out now :whistling


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## Melissa (Feb 23, 2006)

MarkNov said:


> You would tell Mr Jones, who was referred by Mr. Smith "no, not interested" knowing that Mr.Jones would get back to Mr. Smith, and Mr. Smith would stop referring you?
> 
> No, but seeing that Smith selects your clients for you, it might be tempting to bend over backwards.:jester:


They absolutely don't select our clients for us. We can qualify them just like you qualify yours when you place an ad and random people call you up. 

Like I said above, our clients are cool and belive it or not, they wouldn't refer us to some a-hole. My husband has good relationships with them. And it hasn't happened yet.


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## Richard (May 21, 2006)

Melissa said:


> :laughing:
> 
> No, I'm not pissed off at all, not even PMS'ing! :w00t: :no: I'm just trying to understand the point of view of not wanting referrals. It baffles me. Sorry if I sound too intense. :blink: I'll chill out now :whistling


Lol...funny~

I think for me it's around 50%. I'm new, but what I've noticed so far is getting work because a past HO recommended me or a friend or family member met someone. I am not _so picky_yet to be able to pick what jobs I want and dont(unless they are just too far, etc).

In a way, I hope to always be busy, no matter if it's a job I hate or a job I wish would never end. When I'm busy, I'm happy...and so is my wife (and friends and family for that matter-cause I'm not grumpy)

I'll take work from any source. Brand new or referred:thumbsup:


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## dirt diggler (May 14, 2006)

Melissa said:


> Why is it suddenly a "job" when you work for the Smiths and their neighbors? Are you suddenly their *****, because


are we allowed to say that ???:laughing: :laughing:


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## Melissa (Feb 23, 2006)

Only the bitches can say *****! :laughing: Or were you referring to the "job". Is your mind in the gutter Dirt? Or is it in the dirt? ha ha ha.


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## copusbuilder (Nov 8, 2005)

john elliott said:


> Is there some way you can actually _choose_ to have referrals then?
> In my case the phone rings, it might be a referral, it might be someone who's seen one of our occasional adverts, it might be someone calls into the workshop/showroom having noticed our roadside sign, in any of these cases I'm going to quote them for their job.
> I suppose what the guys who work on just referrals mean is that they don't do any advertising and therefore all their work is referral based.
> I don't get any repeat business at all, not likely too either until someone I've done a kitchen for moves and wants a kitchen for their new house- trouble with that is that I am continually raising my prices. If I did a kitchen for them 3 years ago then they are going to have a nasty surprise
> ...


If you build a base and work hard for several years "many" in the right trade can maintain a business on referrals. I have many customers I have worked with for many years and many houses.

I have people call wanting additions and say whenever we get the time is fine....now I could hire more people, put the job out and make a few bucks, or not sweat, leave it on the burner until it fits my schedule. This is not uncommon for me and allows me to schedule my men for months in advance.
It allows me time to pursue other interest such as building or putting the tools on when I want to do a job myself. 
Like I say if someone wants to run and hustle that is fine but people need to realize there is another avenue that can be at least equally rewarding.
For some reason the pushers cannot fathom any other way than what they have been taught or read about. Maybe I need to write a book so they can comprehend a little bit of what I say:laughing:


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## dirt diggler (May 14, 2006)

Melissa said:


> Only the bitches can say *****! :laughing: Or were you referring to the "job". Is your mind in the gutter Dirt? Or is it in the dirt? ha ha ha.


haha let's just say a dirty gutter

beotch


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## Melissa (Feb 23, 2006)

dirt diggler said:


> haha let's just say a dirty gutter
> 
> beotch


Did you just call me a Beotch, Beotch? :w00t: 
I just might have to bring this to a moderator's attention. Where's that red exclamation point?....:shifty: :laughing:


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## dirt diggler (May 14, 2006)

Melissa said:


> Did you just call me a Beotch, Beotch? :w00t:
> I just might have to bring this to a moderator's attention. Where's that red exclamation point?....:shifty: :laughing:



oh no you di-int

:tt2: 

:sweatdrop: 

:laughing:


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## Melissa (Feb 23, 2006)

dirt diggler said:


> oh no you di-int
> 
> :tt2:
> 
> ...


Di-what? :w00t: :laughing: 

Right back atcha Dirt :tt2:


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