Tuesday, March 29, 2016

I posted this question on Linkedin and never expected the whirlwind of conversation that has come out of it! 

Here are what some have said on the issue; 

"The industry has suffered due to the degree and CITB CSCS etc. They have sent so many well experienced tradesmen to early retirement with lots to offer and teach to a now dysfunctional youth.
We now build structures that won't last a hundred years. But there are buildings that have stood for hundreds, nearly a thousand, built through experience, and not a piece of paper."

"The very sad thing is that what they are teaching today is actually curriculum for next decade and has little to do with the brick and mortar of today. Experience accounts for 90% of the problem solving process on every job out there. Very little that we encounter on a daily basis is related to some classroom scenario that we practiced in lab."

"One needs an industry experience to know how things are done in the "real life" (and, even more importantly, how things should not be even attempted to be done and what happens if they are attempted to be done in the wrong way) college degree (really, a college education - unfortunately, I've seen people with a degree but not with a lot of education; conversely, you can get that education without attending college and getting a degree although it would be a little harder) to understand the science behind how things are done - only after one gets both (s)he can put them together and really understand how things happen - and therefore be able to make them happen in the most optimal and "painless" (sometimes even innovative) way. "

Wednesday, March 23, 2016

Construction Owners False Sense of a Good Price

Are you looking at only the bottom line?

My company estimates Luxury Residential homes ranging from $1M - $3M average. My clients (the builder) presents my project budget to the owner. The owner then takes this budget and compares the number against 3-5 other builders in the area. I typically am in the middle of all numbers but here is what is going on and what I see is a huge problem in our industry;

  • The owner does not understand how to de-scope multiples of construction proposals. They are looking at the bottom line, what will it cost?

  • The other builders that my clients bid against are performing take offs on their coffee table while watching Monday Night Football. Performing this type of take off produces an unqualified proposal that is missing multiples of items and calculation errors.

  • Our proposals are take offs generated by state of the art estimating software that updates unit costs weekly to obtain the most accurate price possible. How could this be compared against a coffee table estimate?

  • Bottom line is the Owners will end up paying for everything one way or the other. Unfortunately when they take the lowest bid it’s done the hard way through change orders. 

Getting To Know Youuuu…

We’ve all done it.  You know you have…

That prospective client calls in for a kitchen remodel, you go out on the sales call and it turns out to just be a broken cabinet that just needs a new hinge.  @#$!*%   Hours wasted that could have been better spent on qualified prospects and paying clients!

Not too many remodelers and contractors I know want to be stuck in the office answering phone calls; they want to be out in the field, working on projects and getting the job done!  As a remodeler or contractor, you might excel in the actual work you do, but if you don’t convey that in your initial call with a prospective client, you’re failing miserably and your bottom line will suffer as a result.

After 20 years in the remodeling and construction industry, screening an estimated 20,000 prospects, I have become what I like to think of as a Lead Specialist in my field.  A Specialist who can take the time to spend 35-40 minutes on the phone (so you don’t have to) with Mrs. Finkelbaum discussing her family, passion for gardening and oh yea, that kitchen she wants remodeled.  This blog, Getting to Know Youuuu, will be the first in a three-part series designed to show you how to generate a successful, Qualified Lead!
The first step in Getting to Know Youuuu, is to “place the pillows”.  The more “pillows” you place from the minute you pick up the phone, the more comfortable your prospect will be.  To start, there should always be a consistent and dependable person with a pleasant and comforting voice answering the phone.  You don’t want your cousin Sal, with his New York accent (no offense to you NY’ers out there) qualifying your leads! 

Next, let the homeowner ask about the company and what type of services it can provide.  This part is 75% LISTENING to their needs and wants and 25% of you TALKING.  Always remember to ask open-ended questions.  Questions where the person has to answer with details and not just a simple “yes” or “no”.  This will allow you to get a better idea of exactly what they are looking for, or not looking for!  It also enables you to relate and engage more with the prospect on the the project at hand.  

Monday, February 29, 2016

Would a Mercedes be a Mercedes if it cost half as much — or — would it cease to be a luxury vehicle? 

Imagine if a Mercedes were suddenly the same price as a Yugo, the people who currently buy Mercedes would shift to buy something else. 

Can you offer the highest quality product at a price all consumers can afford? How about the Builder/Remodeler who claims to be an expert, but offers a deeply discounted price? By offering a dirt-low price, are they sending the message to their intended customer that they’re really not the expert they claim to be?

When it comes to price vs. quality homeowners typically choose the middle of the road when making decisions concerning proposals for construction work.  The owner does not understand how to descope multiples of construction proposals. They are looking at the bottom line, and what will it cost? But still want all the quality and do not want to compromise on it.

I find myself thinking ..."So you want to put a deposit down on a Yugo but want to drive out with a Mercedes, Right?"  

A well-qualified proposal is one that is all inclusive of all aspects of the project, this may make the price higher than all the rest but it must contain and be expressive of all items and work to be performed.

Wednesday, February 10, 2016

What makes a great estimator? Is it just knowledge of the code? Maybe thoroughness and accuracy? Just the ability to sit for long hours at a desk starring at electrical drawings,without going nuts?

You, the owner of the company, brought you where you are right now, your passion drive and dedication is what made you unique.  Your personality, integrity and intelligence is why you have built the business to the point you are now ready to hire a Estimator. 

Your estimator should possess the same passion that you do! He is first and foremost a salesman, the first look at your company! His manor and passion is what is going to set the tone for the rest of the project.  Just because he/she is able to recite code articles and stare endlessly at a computer screen hardly makes them a good estimator!

Integrity, able to speak with intelligence, and their confidence are the type of traits you want to have when speaking with your potential clients.   When your estimator shows up on the job are they dressed to represent you and your company?  Estimators have to be problem solvers and have the ability to work through complex issues on their own. They have to be able to write a descent scope letter or RFI. They have to have good computer skills, and they had better be great with math.