Home improvement referral services are springing up from New York to California. They are taking the time to do the legwork to find reputable and reliable contractors and these companies are profiting from good work.
It really doesn’t take much to get started. A home improvement referral service business takes just a little money and no more time than a regular 40 hour a week job. In fact, they can start making money within the first year of business.
The first thing to consider is what types of home improvement businesses you will be referring to. This can include gutter cleaning and replacement, remodeling, building additions, fencing, lawn maintenance, and many others. Remember, even if you like to paint, a client may not like it or may not have the time. Therefore, no business should be overlooked.
Once you have an idea of the types of contractors for your referral service business, you’ll need to call your local, county, and state government offices. Learn about the rules and requirements regarding licenses, bonds, commercial registration and insurance for each type of contractor. This is the first step in building your list. Any contractor who does not comply with government regulations should not be on your referral list.
By knowing these requirements and using them, your home improvement referral business will gain credibility with your customers. They will know that if the contractor does not meet these requirements, they will not be on their list. It makes the client feel more confident that the job will be completed professionally and correctly.
Another way to ensure the credibility of your referral service business is to only look at contractors recommended by your previous satisfied customers. But this is not the end of the selection process. Recommendations are not enough.
Once a contractor is recommended for your home improvement referral business, you need to check out their service. Talk to them, explaining your referral service business. Many contractors will happily give you the necessary information. Ask to see their licenses, bonding information, and insurance to make sure they are up to date. Ask for a list of the services they provide and the cost of these services. Finally, ask for references you can talk to.
You have now started your list of referral contractors. While working on creating this list, she should have started thinking of a name for her referral service business, advertising, office area, office equipment, and ordering a business phone line. She may want to use a computer right away, but a tab or file system could work just as well, and for a fraction of the cost, until her business grows. Keep in mind that as your business grows, office space, office equipment, and the reference list system will likely need to be computerized to save time and money.
Since your referral business will start locally, check with local newspapers and periodicals to see if they would be interested in doing an article about your business. Make some flyers and ask local hardware stores if you can leave some there to advertise your service. You may also want to send real estate agents letters advertising your business, they can be great advertisers for you.
Make your services free for people who call your business looking for referrals. Many home improvement referral companies charge the contractor anywhere from 6% to 15% depending on the size of the project. You put clients in touch with the contractor, and upon completion of the project, the contractor pays you a fee.
Advertise that no contractor is paying you to get on their referral list. If clients or contractors ask how they got on the list, explain to them that the only way for a contractor to make the list is for a client to recommend them. You may want to explain the entire selection process so the person knows the exact qualifications contractors must have before being accepted.
A referral service business can easily and quickly expand. Once your business starts to grow, create a business plan to set goals. Decide how much you want to expand and consider starting franchises elsewhere or expanding the list to include contractors not originally included. This is your home improvement referral service business and you can take it anywhere you want.