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2. Behind the Sale: Uncovering Contractor Sales Tactics
28 Plays1 year ago
In the second episode of the Exposeco Podcast, hosts Brian and Paul Tarpy dive deep into the world of contractor sales tactics. The brothers discuss the various methods contractors use to close deals quickly and the psychology behind these strategies. Paul, with over $30 million in sales experience, shares insights on how contractors control the narrative, create urgency, and employ soft closing techniques to secure contracts. They also explore the differences between honest salespeople and those who are solely driven by profit, and why even well-meaning contractors might not always act in the best interest of the homeowner.
Brian and Paul emphasize the importance of having a neutral party, like Exposeco, to guide homeowners through the contracting process, ensuring they receive the best value without falling prey to high-pressure sales tactics. With Exposeco’s detailed scorecard and unbiased analysis, homeowners can make informed decisions based on data and real needs rather than sales pitches. Tune in to learn how to navigate contractor negotiations effectively and protect yourself from common sales ploys in the home services industry.
Website: Exposeco.com
Tags: #podcast #ExposecoPodcast #HomeServices #ConsumerAdvocacy #ContractorTips #HomeImprovement #HVAC #ServiceCalls #HomeRenovation #SmartShopping #HomeMaintenance #EmpoweredConsumer #Proposals #ConsumerProtection #InformedDecisions #BrianTarpy #PaulTarpy #ContractorAdvice #EstimateTips #HomeRepair #ConsumerEducation
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Transcript
Introduction to Exposeco Podcast
00:00:15
Speaker
ah Welcome to the Exposeco Podcast. I'm one of your hosts, Brian Tarby, and I'm here with my co-host, Paul Tarby. We're here to bridge a gap between our customers and contractors. And we're trying to get the best value, the best service to the people and trying to expose home service industry in the meantime.
00:00:34
Speaker
So grab a cup of coffee or sit back wherever you are and get ready as we're going to transform the way that you approach contracting and home services. So let's get started. Paul, how are you doing tonight? Doing good. I'm excited to jump on.
00:00:49
Speaker
Nice, nice. So we got an interesting topic tonight.
Contractor Sales Tactics Overview
00:00:52
Speaker
We are going to be talking about what happens when a contractor comes into your home and they're going to try and sell you something. And everybody's experienced this. I've experienced this and maybe you have too. So I'm wanting to know, even on the sales side, we've done over 30 million in sales over the life of your business, plumbing and heating and contracting.
00:01:17
Speaker
Tell me what are some of the common contractor sales tactics? There is a lot of different tactics out there. Everywhere from you'll find how to use car sales lot or all the way up to specifically for the industry, but It starts out with different levels of training on the sales side, causes different tactics. So some guys are super polished. They go into your house and they know from the get-go how to control the narrative, control just the whole entire process.
Comparing Sales Tactics: Contractors vs. Car Dealers
00:01:55
Speaker
They're basically walking you through a maze.
00:01:58
Speaker
and they're directing the conversation, directing the whole entire process to end out at the goal of you signing, signing the sales agreement to to get the job done. So there's that complexity all the way down to the simple where they just, they look at everything and then they're saying, hey, if you get this done tomorrow, I'll give you a discount.
00:02:25
Speaker
Because we need the work or I have a unit, a scratch and dent unit that has a little scratch on the side of it. And I can give you a special deal. but We need to get that done like right away. So.
00:02:40
Speaker
There is a huge broad spectrum of different tactics on the way contractors sell, but there's extremely complex ones and then there's there's ones that are not so complex and that are just the used car salesman type where they're throwing out, hey,
00:02:59
Speaker
There's a price increase coming up every time a year. There's a price increase coming up. There's rebates. We don't know when those rebates are going to end. There is we've got extra units that we need to get rid of. And as soon as they're gone, we can't give you that deal. Another common one is is it's a slower time of year and we're trying to keep our crews busy. So we're willing to get you a deal if you're looking to get this done right away. Those are all.
00:03:26
Speaker
Yeah, they're just, they're all ploys to get people to move and get things done fast so you don't have another contractor come out. Cause everybody doesn't want you to meet with anybody else. Cause the chances of them getting ah the job is, it goes down significantly and the broad spectrum of ways people end up trying to try to make that not happen.
Creating Urgency and Soft Closes
00:03:50
Speaker
There's a million different ways. Yeah.
00:03:53
Speaker
There is so much to what you're saying, because I studied communication theory in college. And this is like calm theory stuff 101, just the way that the sales, wholesale industry is structured. You've used car salesman, and that's one of the most easy ways that people can understand the sales tactics, which are applied in the like in the contracting industry, which are a little bit more covert, which is why it needs to be exposed.
00:04:22
Speaker
In the car sales industry, you're exactly right, man. You go to a dealership and that car salesman knows that if you leave his lot, the likelihood that you're buying a car from him goes down exponentially. So everything that he's trying to do is to close the deal right now. And he doesn't want to see you walk away because you're going to think about it. You're going to have other opportunities. You're going to rise other deals. You're going to come up and then you run to find something that just works better for you.
00:04:52
Speaker
And so he has to create scarcity by saying, this car is not going to be available in the next 24 hours. I've got another person on the line that's going to come see it. They just need to know what I need to know. Let them know if you're going to take it or not. Otherwise. And so they create the scarcity, which is what you're talking about. We have these units left over from 2023. If we don't, we got to get them out now, but when they run out and the deals changes and their units are more expensive. So you create that scarcity of the deal.
00:05:21
Speaker
And so that's what contractors are doing. Like you're saying, talk more about this urgency thing. Cause I think that's one of the things too. It's not just about getting the deal done right now. There's something else about urgency. I think that they're creating, do you think that buyer's remorse, maybe how does that play into a sense of urgency when you're a salesman? What are you thinking about when you're trying to close a deal?
00:05:45
Speaker
Yeah, buyer's remorse is for sure something that is always on the salesman's mind, right? It is, am I going to leave here? People are going to be accepting what we're doing, happy about it. And then later on feel, oh man, I made the biggest mistake. I'm going to cancel this thing.
00:06:06
Speaker
Does it happen? Yes, it happens for sure, like all the time, especially if and with skilled salespeople that are, you know, not pressuring people, but putting some pressure and giving people incentives to, to get things done right away. A good salesperson will leave the home with a signature majority of the time.
00:06:33
Speaker
even if those people are looking to still get other numbers. We used to call this soft closing. So it'd be ah you people that use lines like, are you just looking at what option you want to go with? Or is he still looking at who you want to have do the job?
00:06:49
Speaker
And when you say that, you're getting them to tell you that either they don't want to use you, which nobody wants to tell you that to your face. Yeah, like most people don't want to say that to your face. And then you're putting them in a corner. It's a genius sales tactics is when you say that they always say, Oh, no, I'm just deciding on what option I want to go with.
00:07:13
Speaker
So then at that point you're able to say, okay, that's great. So you don't have to choose that option today. We can just get you in the schedule, take the deposit for the installation and we'll get the permits pulled and everything like that in order to get the ball rolling on everything. So that way it gives you a couple of days to actually choose what option you might go with.
00:07:38
Speaker
So how would you like to put your deposit in? And you're just assuming the sale there because they they told you they were going with you, but they just didn't decide what option. So you're leading them down this the road of accepting the proposal or at the job by just work in a conversation that you people are uncomfortable with. That's an example of a very skilled sales tactic, right?
Training for Handling Objections and Self-Interest
00:08:10
Speaker
What people don't understand is that like these air commission guys, these sales guys, they're sitting in an office one day a week and they're training with other sales guys and they're acting this out. They're role playing these conversations. And their goal is to get you in that conversation so that role play can happen.
00:08:30
Speaker
and that they can lead you down that road to get a commitment out of you. Just one example, I can give you dozens of other examples of being able to take people's objections to getting something done and a common objection of customers is I want to get three or four bids.
00:08:46
Speaker
Which is a super smart thing to do, by the way. We, it's like in the military, you train for action, right? These guys are training for, they're training for these situations. They get paid based on what they do, right? Exactly. They get paid by the yeses that they get, not the nos. And they're ready for those. Hey, I want to get four other numbers. Oh, that's totally smart. But what are you looking to get out of those numbers that I haven't provided you today?
00:09:13
Speaker
And they're really putting you on the spot. And that's a good salespeople do. And so you can have really talented salespeople that have their own pocketbook in mind always. And any salesperson is, I think, lying to you if they say that they don't have their own pocketbook in mind most of the time. and I mean, there's about that last week there's a rare few that I feel like are pretty dang straight up.
00:09:43
Speaker
i I don't necessarily think that even if they are the most honest people, they're not the best salesperson for the consumer because a lot of times those salespeople are selling something that they're sold on and they're not really necessarily looking at what the consumer actually needs.
00:10:05
Speaker
and doing you know the right analysis. So the there's guys that go out and they talk about how honest they are and they are so they're indoctrinated into their own beliefs. And I'm not saying this is everybody, right? But this is the majority of people that I've come across and I've gone through lots of trainings with a lot of different styles of salespeople and business owners, air conditioning, just regular air conditioning guys.
00:10:35
Speaker
And the guys that talk about how they're the most honest are a lot of times very stuck in their ways. And that's a detriment to
Salespeople: Buyer Representatives or Seller Allies?
00:10:45
Speaker
who the client that they're serving, because they're not knowing and they're not educated on the broad spectrum of different things that that can really help clients for different needs in different situations. Like where you live, you'd want something that's going to be really energy efficient because you run it all the time. There may be and a lot of these guys that have
00:11:12
Speaker
those those feelings of I'm just really honest, so I'm not going to oversell somebody or I'm old school. They have these mentalities. I'm old school. We don't want all those bells and whistles because those are more things to break type of mentality.
00:11:27
Speaker
is a detriment to the consumer, right? And they feel like they might be upselling you something or selling you something that they don't think you need, but they really don't know what you do and you don't need. There's two sides of things. There's the guys that are out there to take the bacon home every single time. And there's the other guys that think they're being, they're just being top notch and the most honest person ever and they're underserving the client because they're afraid to have a reputation of.
00:11:58
Speaker
selling something that is going to be a lot more expensive. So there, that's going back to an earlier point I think we made in the previous podcast is that it doesn't matter if the salesperson is honest or the salesperson is ah crooked or just, I guess, not even crooked, just uses the tools that they're dispensed, forces people to make decisions that they're not ready to make that kind of person just uses all of those tactics.
00:12:25
Speaker
They're just not a good representative on behalf of the buyer. It doesn't matter who they can try and say that they're representing the buyer or trying and looking out for the best interest of the person, the homeowner. They aren't and they're not able to because they're on they're firmly on the behalf of the seller. And even in their mind, even if they think they're on the behalf of the buyer, say they're a good person and they're trying to do right.
00:12:50
Speaker
Very few of them are actually able to to disconnect themselves from their company or the brand that they're selling because their identity is so closely and intertwined in that that they can truly do what's best for the homeowner.
00:13:04
Speaker
And that's, that's why you really do need somebody. You need somebody to back you up. You need somebody to come alongside the same. Then I actually have no dog in this fight. Like the only dog I have in this fight is and there's the buyer, is the homeowner. And I'm just just, I'm going to put together all the pieces for them and figure out what is really best for them. I don't care which brand they use per se, as long as they're using a reputable brand. I don't care which contract they use, as long as they're using the best.
00:13:28
Speaker
Most reputable and honest contractor. All of those things, we don't make money from those things. That's why people do need, you know, somebody, a friend in the business. epi Seems right. It just seems right to me. Yeah. Well, we have literally a calculation to decide what's the best for you, not somebody's feelings. So it's based on our scorecard, right? It's based on.
00:13:55
Speaker
We're taking all the customer's needs, wants and past history and future plans and also with geography, knowing where you're at, what your utilities cost is. We're making this decision on what equipment is the best for you based on real numbers and not based on are feelings about something. So it's not feeling based and it's also not pocketbook laced. You know what I mean? So it's, it's got zero motives behind it other than just truth. Can you give an example about that? Because I think that most of our listeners want exactly get quite Dutch real life examples. Like say, do you want to smart thermostat or not? Or
00:14:45
Speaker
That's a basic one, but how about like the high efficiency unit? Because almost everybody is told you need a high efficiency unit. So how does that work out in terms of your climate, whether or not that's truly best for you? Can you get into that? Yeah. So I'll give you a good example. You live in ah Chandler, Arizona, very hot out there. We can all agree that air conditioners are going to run majority of the summertime.
00:15:13
Speaker
And the spring and the fall. And the spring and the fall. Now, you plan on moving out of your house in a year or two years. The benefit of of buying a super high efficiency unit is not going to pay off for you.
00:15:33
Speaker
Right? So we're going to figure that in and saying, hey, look, you you plan on moving out. You plan on leaving. Nobody buys a house because there's a high efficiency air conditioner inside that house. It's not really asked about. It's not a common thing to be asked about. Now solar is becoming more popular. Like it's more of an asset to the home.
00:15:54
Speaker
People are seeing that. um But air conditioning still is low on the totem pole of things that people are looking for when they buy a house. And that's true. They're asking if it's new or not, right? I mean, they're asking is how old does my how long is how long is your How old is your system? How long has it been here? um Is it still under warranty? like Those are the things that are are the concerns of the new home buyer.
00:16:22
Speaker
They're not saying how much is your electricity bill because of your air conditioner. They're, look, maybe one out of a thousand are talking about that, but the majority of people don't ask about that stuff. So where salespeople would come in and say, hey, you need a high efficiency unit. You live in Arizona. You're in Chandler.
00:16:44
Speaker
A lot of people don't bring up the fact of, hey, where are you going to be in two years? Or where are you going to be in a year? What's your plan with this house? Are you planning on selling? Are you planning on living it? So forth. That's just one small example of taking a climate and still end up buying a system that's just going to get the job done and not is not going to have all the bells and whistles.
00:17:11
Speaker
because you're not going to get the repayment from it. We help people make good financial decisions and, and also obviously choose the right type of contractor to go with based on their scorecard. That's just one example. I think that's a good one.
Are High-Efficiency Units Worth It?
00:17:26
Speaker
And we can even, I think expand out from that because use an interesting perspective of somebody who's going to sell a home. do Are they seeking with foresight?
00:17:37
Speaker
How long am I actually use this unit and will it actually pay off? What's the, what's actually the payoff point where I'm breaking even on having bought this more expensive high efficiency unit rather than buying this less efficient unit. And for some people and some clients.
00:17:55
Speaker
would never have paid that off. They would never pay it off, not just because they sold their home, but because they live in an area of the world in which it just isn't used very often. So the actual cost savings would never equal out by the time that the expendable life of that unit is done. And a lot of parts of the country Energy is not that expensive. San Diego and California is insane. It's like super expensive. It's not a far fetch to have a $700 to $1,000 electricity bill.
00:18:28
Speaker
It's insane. But there's other parts of the country that you'll pay 50, 60 bucks a month for electricity in the rain there. There is places in the United States that a high efficiency system still doesn't pencil out for the life of the system. But there is other things that arm are benefits that come with those systems that people just like in general and are going to they're going to live in their house. They want to be comfortable. they want to They don't want to be hearing it. they don't There's a lot of so letting you go and other factors. yeah And all those factors, we go through all those factors. We have a process in one of our packages that we offer. Yeah, then we have a questionnaire that we go through and it helps really to specifically customize something for you. but We're talking about the main issue, which is that, do you really want to trust all of that information to a person who's not firmly in your corner?
00:19:22
Speaker
Do you want to trust that to a salesperson who's literally, their bottom line is probably sell you the best or the most expensive package they can. They're not concerned about your wallet. They're not even really concerned about your needs, right? They've got an extra unit sitting in their warehouse that was a return or whatever some unhappy customer sent back. They're trying to put that at your house because that's going to save the ah company money and that's not even the right unit for you.
00:19:48
Speaker
Do you have the know-how to discern and to actually talk with a contractor, make sure that he's not giving you what you truly don't need long-term? Because these are big financial purchases. like We all care about what car we drive. ah We care more stylistically about that. But are we aware of what units we're buying or putting in our house when they're almost the same ticket price, like maybe about half the ticket price of a car, $20,000 or anything?
00:20:18
Speaker
There's a lot there because good salespeople, they'll go in and they'll make a lot about what they're offering is, tie into what your needs are, even if they don't actually correlate, but they'll be able to work it in a conversation and be able to puff things up that aren't really is important. They'll tie them into some pain points that you have.
00:20:43
Speaker
And they'll convince you that you have to have that. It's really important. And they'll do things to make themselves look better than other people by pointing out that those other people don't include them when you get into comparisons and such. The question is, would you want somebody in your corner figuring out what your actual needs are? And most of the time,
00:21:07
Speaker
they're going to put together things that are the stuff that's really expensive are is going to hit your needs perfectly. And the stuff that's really cheap is not going to serve your needs whatsoever. And a good salesman will make you realize that and then you're going to be spending a lot more money to buy an option that's going to serve your needs completely. And that's the salesman lying in his pocketbook there because there's going to be a lot more fluff in it.
00:21:36
Speaker
Is there a scenario in which a salesman says this unit that I'm trying to sell you or whatever is exactly what you're asking for? Is it exactly what you need? It is high efficiency. It's got this long extended warranty. It's got all of the bells and whistles. You're going to be really happy. It's really quiet. It's got a great reputation and it's not made poorly.
00:21:57
Speaker
But in reality, they could be saying that about any unit. Is that a reality that a salesman comes in and could say that, let's say your house needs a five ton unit. Okay. We're in technical five ton unit. He's selling you a three ton unit. He says that's exactly what your house needs. If you think that's a scenario that could happen. Yeah, it could happen. I think.
00:22:18
Speaker
The majority of contractors are, at least my experience of the majority of contractors are, they're being sleazy in the fact that they're saying they have an extra unit for you, but they actually don't have an extra unit. They're just pairing you up with the unit that, that they think is best for you. And they're using whatever.
00:22:38
Speaker
whatever tactic they can to say, Hey, we got this extra unit sitting around. I know that I can get the, I can call the supplier, make a deal for you, or we have it. So we just cancel the job. It's sitting at our warehouse. I think that's a wide lie. Yeah. I think that's a, I think that's a common thing that but people are doing. I don't necessarily think they're, I think they're, the magic unit that's appearing is the one that you need and.
00:23:04
Speaker
They're not underselling you, overselling you. They may be, I think that there's contractors out there that may be doing that. But I think the majority of those guys are, they're just creating the story that's going to fit the narrative on why you need to do it today in order to get that thing closed.
California Sales Laws: Waivers and Reviews
00:23:21
Speaker
But majority of the time, I don't think that UNIT exists at their warehouse. I think that their order that kind Yeah, because the reality of it is when these guys say there's only one left or I have an extra one, if they are buying any sort of quantity of units per year, they can just take it back. With no, there's not a restocking fee. There's none of that. when If somebody charges you restocking fees, that's the first distributor I would stop buying from.
00:23:56
Speaker
and as a contractor you As a contractor, if you charge me your stocking fee, I won't buy from you. We would spend millions of dollars with these distributors. You think they would charge us to put it back on their shelf, then sell it to us a week later? No.
00:24:10
Speaker
That's the suicide for them. And California actually, California has a law that stops people from, allows them to work through their buyers of Mars. And so it's it's like, ah it's a five day ride to cancel. So they have five days to be able to cancel the job by law in California.
00:24:28
Speaker
But these contractors, they actually make them sign waivers to say, hey, I'm waiving my right to cancel. They can't cancel within that five days because they're waiving that they're signing an agreement to. And do you think that the people know that they're signing that or do you think it's just in the middle of the paperwork when they go to do a deal?
00:24:48
Speaker
It just depends on the sales guy. I think that I'm sure there's sales guys out there that are just like fumbling through and saying, hey, we just need signatures here and here. And the contract is 10 pages long. You do what you do in your iPhone and you just accept all the terms and conditions. There's a lot of repercussions on contractors if they are doing that and they're not explaining it through. The state of California requires you to have a salesperson's license. And you have to go through background checks and all that other stuff to get it, which I actually think it's a pretty good thing, but I don't think sales people take it seriously. And you know what companies take seriously though are bad reviews because it levels the consumer playing field at that point. Bad review is, I've heard it's worth over a hundred thousand dollars in revenue to a company. That is a high volume company because
00:25:40
Speaker
It means that $100,000 worth of work said no because they read that bad review. And that's pretty important to a company to make sure that their reputation stays up. Now, do I think you should go write bad reviews to every company that does one or two things that kind of irk you? I don't think that's necessarily the case. it's A lot depends on how they react to ah the situation when something goes bad, right?
00:26:09
Speaker
because People need to give contractors a little bit of grace when it comes to the complexity of jobs, that there's things that can go wrong from time to time. As long as they make it right at the end of the day, there shouldn't be a battery review written on those those people. But you know what? If people are out there and they do wrong, you have every right to be able to to complain.
00:26:35
Speaker
Yeah. Well, a lot of other people know, Xpo's correct. We're all about that. Yeah, exactly. The bad workmanship, all that stuff. Oh man, this has been so interesting. There's so much more I think we could have gotten into as well. And I think we will in coming weeks, getting up to some more of the ins and outs of salesmen and how they operate their mind when they come in the homeowner's house.
00:26:57
Speaker
to sell them something. And hopefully now maybe our listeners are a little bit more aware as they are already aware of the car salesman's tactics. Maybe they can apply some of what they know to that when somebody comes to sell them something.
00:27:11
Speaker
Maybe they'll realize ah that they don't know as much about heating and air conditioning and other trades as they do even about say car buying. So maybe they think it's time to get some help with this purchase because it's too big. It's just too big to mess up and it's too important of a decision
Support in Sales: Avoiding Pressured Decisions
00:27:30
Speaker
to mess up. Yeah. And you want to have a.
00:27:33
Speaker
You want to have a backbone. And it's hard for a lot of people. Yeah, no. a lot When you have somebody that goes into your house as a trained professional to be able to get you into a position that makes you feel uncomfortable, makes you feel like you need to, or makes you just feel like you need to do something and you need to buy, you need to have a backbone, somebody that's, that's has your back and tells you before you meet with these people, you are not allowed to make a decision if you want us to do our job correctly. That's what we do for people is like, hey, that salesperson can be so great. He can be an amazing sales guy, but you know what? Your backbone is going to be behind you and they're going to actually tell you if he's really great or if he's just smoking mirrors.
00:28:24
Speaker
It takes the pressure off the making the decision then and there. It eliminates that. That's what we do is we make people say no.
00:28:35
Speaker
And a good salesman is going to sit there and tell them that, hey, look, you're going to miss out. And we're telling you right now that we know you're not going to miss out. but You can't tell that homeowner anything that is going to make us believe that they're going to miss out because we know all the tactics. you don't We don't play games, we know what's up. So, we're going to be looking out for their best interest. We're going to keep those wolves at bay and we're going to find out which wolf is is the right one to go with. If if it's even a wolf, it might be a super nice guy that doesn't want to sell at all and he just gives you gives you the right things, the right options and and also ah the right the right promises and they have the right reputation. I mean, we want
00:29:23
Speaker
you to write make the right decision at the end of the day. So making the right decision is not making a decision at all at the table, that's for sure. And we help to make sure that you have that excuse of, hey, my big brother does heating and air conditioning, and he's going to help me look through these. He's going to look through your proposal and compare it to everybody else's. So give me your best to offer up front.
00:29:48
Speaker
because he knows what he's looking at. And if they have questions, they'll give you a call. Yeah. I mean that, that's the beauty of what we're doing, right? Is that those sharks that are coming in and they're controlling the situation, literally sharks, what I'm saying, sharks are these sales guys that are like really good. Um, they're controlling the whole entire meeting from when the doorbell gets rang and gets ah and the door opens up, they are dictating what's happening. It's called taking control of the call. And these guys are well trained. They know exactly what to do. And and when you push back on what theyre what the establishing control and everything like that, they are trained to be able to get you back in line. It's pretty pretty impressive. What needs to be exposed is that
00:30:38
Speaker
You're not just dealing with some random, it's not just a conversation. There's always something to it. And this, I'm talking about people that are, that are really good at what they do. And we're not talking about.
00:30:51
Speaker
the guys that just come in and look at it and five minutes later out the door talking about the guy that sits there for two, two and a half hours and works with you. yeah That was all scripted and planned. So it's interesting. There's so many levels of it though. And some people won't even experience that because they'll find three or four.
00:31:08
Speaker
Guys that don't do that and don't understand that level of sales, which is fine. We'll still find out which one of those guys is the best guy for them. And they still will use some level of used car salesman tactics. Let's try to close it. Absolutely. That's par for the course. So yeah, Paul, this has been a really great conversation. Thank you so much for your time today and tonight. ballas cow oh Thanks guys. See ya.