Home builders today find themselves in an uncertain world, characterized by fears of inflation, tightened lending restrictions, job losses, short sales, foreclosures, stock market woes, the presidential election, increasing gas prices, slash-and-burn tactics or other gimmicks to move inventory–the list goes on and on.
The age-old rule was 80/20, with 20 percent of the sales force doing 80 percent of the business. It's now 80/15/5. About 80 percent of salespeople are pretty good, selling and greeting as they did when the market was hot. The next 15 percent are excellent and have adapted to the market with the determination to succeed. They see sales as a career, not a job. The remaining 5 percent are the masters, those who study, prepare, plan, and practice. They are goal-orientated and seek to differentiate themselves. They educate their clients and act as true consultants, understanding that the more they give of themselves, the more they will receive.
More than ever, selling value is the difference between success and failure. Price alone will not sell homes. When builders compete strictly on price, no one wins–not even the buyer. Buyers can always find a product cheaper another day, another place, another way. They must close fast, otherwise you will lose them. They will always question themselves, thinking, "I could have gotten it cheaper." If you are the Wal-Mart of the building industry, price alone may allow you to survive. If you are not the industry's Wal-Mart, then you must understand your competitive edge. Every customer starts off with a price in mind but ends up becoming more value-oriented when pulling the trigger to purchase. Value selling is the emotional combination of the benefits and beliefs that move your customers to the price you're offering. As a salesperson, you cannot control the price; your role is to influence your customers in a way that drives them to purchase. You can't use price alone as an excuse for low sales numbers.
Your demonstration needs to be rehearsed and re-rehearsed so that, upon delivery, you will obtain customer buy-in. This makes closing a lot easier. Otherwise, price and desperation will take over and you will lose either a buyer or money.
I call my strategy for success the Power of the Ps: plan, practice, preparation, passion, and purpose. Until you master the Power of the Ps, you will never be in the top 20 percent of your business.
–Jim Capaldi is a broker and director of sales for Standard Pacific Homes, Ventura Division, and author of the Ultimate New Home Sales Success Manual. He may be reached via e-mail at email@example.com.