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Canceled Contracts – Easy Fix?

Nothing is worse than a homeowner canceling on you after you sign the deal.

Unfortunately, this happens for both retail and storm-damaged roofs, especially with storm-damaged roofs. After you’d put in all this work, getting the homeowner approved, working with the adjuster, and maybe even supplementing the job, then:

  • The homeowner puts $30,000 in their pocket and says, “Hey, we’re going to shop around.”
  • They ghost to you.
  • They say someone could do it cheaper.
  • Or they even turn back to you and say, “Hey, I want your estimate now.”

However these deals go south, it is infuriating!

By the way, this topic was inspired by Ryan M. Thank you, Ryan, for messaging me about this. When he did he said:

Dude, I just had another customer cancel! I don’t know what’s going on. I need your help.

This happened right after I literally put $30,000 in their pocket.

So, I want to break down:

  1. Why people cancel
  2. What you can do to protect your jobs, so they don’t cancel in the future.

Now, the one thing that I want to be crystal clear about upfront is the fact that we are NOT talking about:

  • Forceful techniques that some reps use to prevent canceling, like loading roof materials at homes
  • Literally locking folks into a deal

I do NOT agree with those techniques. Instead, I’m going to go a little deeper on the sales side.

Before we do that, I want to say a quick welcome or welcome back. Adam Bensman, here, The Roof Strategist. Everything I do here is designed to help you and your team smash your income goals and give every customer an amazing experience.

And if you like what I’m putting out here, you’re going to LOVE what’s inside my free training center. There’s NO catch — just hop in there right now to get training and information for new roofing sales reps, seasoned sales reps, managers, and owners.

Now, let’s dive in.

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Roofing Sales Cancellation Tip #1: Use Contingency Agreements.

When Ryan reached out to me about a customer cancellation, the number one question that I asked was this — are you using a contingency agreement?

I know this is a can of worms, and some people are way against it. And — **SPOILER ALERT** — I’m way FOR IT. Check out my video on Contingency Agreements for more on the pros and cons of the contingency agreement.

So, when I see lots of cancellations, there are typically two reasons for this:

  1. The roofing sales rep is NOT using a contingency agreement.
  2. The rep is NOT using the contingency agreement appropriately, meaning they’re not going through and setting the right expectations with the homeowner.

After all, when we’re dealing with a storm damage claim, homeowners don’t realize how much time, energy, expertise, and man hours go into serving a single customer.

On the other hand, with retail deals, we get called out, we show up, and we do an estimate. They say, “Yay, we want to do it,” and we get the job done.

But on the storm side, we show up and:

  • We give them that same presentation.
  • We go through everything, and then we meet with the adjuster.
  • We review the paperwork, the supplement, the invoice, and more.
  • There’s so much more work that goes into serving the customer and getting them made whole.

So, I think it’s fair to say that if we contractors were not involved, there’d be a lot of folks who would get shortchanged. That’s just how it goes.

With that contingency, roofing sales reps often fail to go through the three key points. And if you want more on this, check out my playlist on How to Use the Contingency Agreement as a Closing Tool. You can also follow my sales system and find out more about it by clicking that link or texting “FREE” to (303) 222-7133.

So, those bullet points in the contingency agreement are designed to get the homeowner to acknowledge that they’re not being billed for the time, energy, and expertise needed to get the job done.

When the homeowner realizes this:

  • They’re usually like, “Oh, wait a minute.”
  • They understand that their contribution is their deductible, no more, no less.
  • We remove ALL of their risk so that they’re not locked in.
  • We become the contractor of choice.

Now, if those key points are NOT drilled in, then:

  • The homeowner leaves just thinking they were forced to sign some piece of paper.
  • They may think they’ve just made a handshake deal, or they don’t realize it’s formal.
  • They don’t acknowledge how much work is involved.

So, again, the contingency is a big piece.

Roofing Sales Cancellation Tip #2: Set Clear Expectations.

Next, we have to set crystal clear expectations with homeowners. That means that people need to know what happens next.

After all, when was the last time you watched a movie — and predicted how it would end?

That’s human nature. We predict how things are going to end. So:

  1. If we don’t write that narrative for our homeowners, telling them what it’s like to work with us, they start filling in the blanks on their own.
  2. If I don’t end every single visit by letting them know what’s next, they start creating their own narrative.

I do NOT want that because:

  • Those homeowner-created narratives are usually NOT right.
  • When homeowners fill in the blanks on their own, they’re usually doing themselves a disservice.

So, I’m going to let them know:

  1. What’s going to happen
  2. How we’re going to service that customer
  3. What could happen with competitors

Now, cancellations are much more common on the storm side than in retail. In fact, with retail, it’s usually that the homeowner found someone cheaper, which is why collecting a deposit and kick-starting that project right away are so important.

On the storm side, as we initiate things, here’s what we can say:

Hey, this is what our team’s going to be doing.

We’re going to be waiting for you to give us a buzz when the adjuster’s coming out, so you can let us know the time and date.

Then, we lay the groundwork. After that, as the process moves forward, we can say:

Hey, we’re reviewing the scope and preparing the supplement.

The point is to point out to the homeowner that:

  • We’re doing this stuff.
  • You’re going to be expecting this.
  • Here’s how the install is going to go.

You have to lay out all of the steps and alert them to what could happen. To do that, you can say:

Unfortunately, many unscrupulous contractors are going to try to snake business away.

They’re offering things that are unethical and, quite frankly, illegal.

So, if anyone shows up at your door, just let them know you’re already working with someone.

Again, you need to let them know what’s going to happen next.

Roofing Sales Cancellation Tip #3: Use the Purchase Validation.

Next, we want to excite the homeowner with what’s called purchase validation. This is the opposite of buyer’s remorse, and it means communicating something like:

You did a great job deciding to work with us!

In fact, the one thing that salespeople often forget to do is to excite their customers. This can be as simple as saying:

Hey Peggy, congratulations!

I am so excited to be working with you.

You made an excellent choice working with me and the team over at [your company name].

We are dedicated to making things right and doing an incredible job for you.

Next, behind the scenes, the team is high-fiving you for the opportunity to serve another amazing human being. And you’re coordinating your team, getting them ready for the next steps.

Again, your cancellations will DRASTICALLY fall when:

  1. You have clear expectations.
  2. You get your customers excited right after closing.
  3. You stay in touch with your customers.

Final Roofing Sales Tip: Keep It Moving & Keep Communicating

My final tip here is that you need to move things along QUICKLY and stay in communication with your customers.

I believe that you should stay in communication at least weekly, even if there is no update.

Why?

If things sit, people start to wonder, Are they on it? Did they forget what’s happening next?

When you stay in touch with people, even if there’s no update, they know you’re on it. These updates can be as simple as saying:

Hey, I just want you to know I’m on it. I don’t have an update yet. I’m still waiting on [fill in the blank].

Or you could say:

Hey, I just wanted you to know we ordered your materials. There’s a slight backlog., and the delivery is expected to be here on [whatever date it is].

I just want you to know that I’m working on your scope of loss, so I have all of my notes prepared to meet with your adjuster.

Again, the point is for them to see that:

  1. You have skin in the game.
  2. You’ve already begun working on things.

When you do all of this together and present the contingency agreement in the right way, setting clear expectations about what’s going to happen:

  1. You excite the snot out of people working with you.
  2. You can move things along really quickly, so it feels as if the project is in motion.
  3. You are going to see your cancellation rates PLUMMET and hopefully go away.

Now, I know that cancellations happen every once in a while, but this is going to help you secure more deals by delivering an amazing experience for your customers. At the end of the day, that’s what it’s all about.

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Thanks for joining me, and I look forward to sharing more with you in the next blog.