More and more people are doing all their shopping on the internet. We are all aware of the impact this is having on local small business. This article is about the construction internet lead generating sites and the impact on the residential remodeling business they are having. The days of asking your neighbor who did the good work on their house are disappearing to the typing in on a search engine for a local contractor.

The way the lead generating site works is a potential customer fills out a modest form and the lead generating computer sends it to competing contractors in your area and charges them a variable amount depending on the lead for the chance to try and get the job.

I believe this is taking money out of a already strained industry. For example; it costs around $50.00 a lead. A contractor may get 1 out of every 10 leads due to the fact there is not enough information on the short form for a contractor to know if it is right for him and many of the leads are people just curious and figure it does not cost them a thing to get a price. And some even think a price will be shot back at them from the internet. But by then the contractor has already paid for the lead.

Around four competing contractors also pay for the lead. So at around $50.00 a lead times 10 equals $500.00 per signed lead, times 4 contractors, equals $2000.00 that should have gone towards the work instead of a lead service.

This also creates a good place for sales people. Which if done right will leave more time for the people who know how to do the work. If done wrong will be about telling potential clients what they want to hear to win the lead and then possible hiring cheap inexperienced labor to make up the difference in a cheapest price environment. And unfortunately once the job is signed and started it is to late to find a different contractor because it will just cost more to fix what has been done. Or worse a complicated court battle wile the job is still not finished.

This is becoming more about sales and less about the quality work. This is forcing many of the quality contractors who have done this type of work by word of mouth to go out of business or worse to cut corners where they normally wouldn’t to make up the difference of paid for sales leads or cheapest priced contractors.

The fear is all that will be left is the cheap poor quality contractors sort of like the scenarios of all the new products that continue to come out with big guarantees and descriptions of being better and cheaper than the old stuff. Then after the good old quality companies go out of business or have cheapen their product to compete, people start finding out the new product does not last and the warranty has loop holes and will not cover the cost of replacement labor. Over the years I have seen this time and time again and I always tell people not to buy any product that has not been proven for at least 10 years or more. So you are aware of its limitations.

What many people who have not had any remodeling done before don’t realize is there are different levels of quality, cost and construction, for instance; you would not really want to put a $100,00 kitchen in a apartment, nor would you want to put a $3,000 kitchen in a million dollar house. or spend $15,000 on kitchen cabinets and then pay $50.00 to have them installed and expect be happy with the results. The price should depend on what you really want and the value of your home. It cost more to do it better because it takes longer. This does not mean you should pay too much. Just make sure you are getting what you are willing to pay for.

This really sounds like just a bunch of complaining on my part, but the purpose of this article is to educate the customer who ventures to one of the very lucrative lead generating companies that the reality is you will probably not get the cheapest price for the best job (you will probable get less than what you pay for). It is not like all the contractors are out their are making a fortune and living the high life. In fact most quality driven companies are being replaced by cheapest price driven companies.

However there is a referral system with these lead services and many happy customers. What they don’t know is that around $2000.00 has already been paid out for their job that could have gone into the work.

Best advise; do not ask a contractor to compete to be the cheapest price but to compete for the best job for the price. And try to have as much of your hard earn money go towards the work because in the end that is the best value. Try a non-profit company evaluator, or one of the lead generating companies were the customer pays for the lead, that way only $50.00 less is not going towards your job. Or better yet ask your neighbor.

Make no mistake this article is my way of combating the internet lead generating companies from taking so much money away from the work we do and threatening to put us out of business after years of doing top quality work by word of mouth referrals.

Daniel Christopher

www.christopherconstructioncompany.com