# Where are we headed?



## Mike(VA) (Jan 9, 2008)

In the thread titled "WAG or SWAG", Jerrald Hayes said: 
The construction industry is full of inefficiencies and waste and we are behind the times when we compare the services we offer in to those offered by other industries and consumer demand will drive change down the line. And let's face it the new construction market will never come back to what we saw going on in the last couple of years nor should it. The building and remodeling industry as we know it is due for and in for a major remodeling.

Jerrald, if you are reading, could you expand upon your statement? I wonder how others think our industry will change? We have been through resessions and downturns before but not like this. Today, I mentioned to my wife that it seems that the majority of my business has come from HO's who have used the equity in their houses to finance improvement and expansion projects. Since that avenue of financing has essentially dried up and will not be available for a long time, what happens now?

It's easy to say "well, they will just have to borrow the money somewhere else". Yes, I agree if they intend to do any projects. However, many will opt out of any new work for quite a while, so what do we do? Its not just that people aren't spending, its also that a big chunk of our base market is gone. Now what?

One thing I see is that this new paradigm will not allow for the numbers of companies around today to continue to exist. Unfortunately, there are too many companies chansing too few dollars and that will continue for a long time and something will have to give..


----------



## silvertree (Jul 22, 2007)

I'll wait to see Jerrald's answer, but we agree on this, the home improvement industry we knew is gone forever, the models we used will be changed and there will be fewer companies. We are one of the few businesses left that still hasn't consolidated or centralized. Realtors were like us until 10 years ago. I'm ready to operate on another level. For years we have bid against inexperienced competition, that and the fact HO's can't see the difference between us Home Depot and unlicensed hacks has made this a difficult business to succeed in. When over 90% of businesses fail in an industry within 5 years that tells me we spend as much time seperating ourselves from these guys as we spend educating ourselves to stand apart.


----------



## rbsremodeling (Nov 12, 2007)

Here is where I plan to be

5-8 guys Lead carpenters backed up by subs/

Doing 15-25 jobs a month.

Estimates done on the spot up to 150K

Every lead carpenter will have a laptop and printer in the truck and van with access to all job and company information.

My average employee will be 35-45 years old that just needs some grunts for the hard heavy work, while they do all the thinking and sub supervision.

We will be servicing 5 states in 3 years.

You will get tired of hearing my company jingle commercial like the damn empire carpet commercial.

I kitchen and 1 bathroom WOW van in every state. Sorry Paul

In 10 years I will either be well off or working for one of you guys telling old contracting war stories of how it use to be while picking up my check.


----------



## silvertree (Jul 22, 2007)

> You will get tired of hearing my company jingle commercial like the damn empire carpet commercial.


I'm already sick of it and I haven't even heard it yet:laughing:


----------



## ChainsawCharlie (Jan 16, 2008)

Where we're going, and how we'll get there.


----------



## HomerJ (Jan 23, 2009)

I remember reading a thread about a month ago where someone posted something along the lines of "what worked before will work again when this crisis passes".

While I understand the thought process behind that statement, I'm not so sure we can just wait it out, tighten our belts and be ready when the HO's start calling again. 

It's hard to speak in general about the industry because there are so many specialties, but I envision more govt. regulation, stricter licensing requirements, more transparent pricing and higher costs of entry are in our future.

Beyond that, one thing that's still very clear to me is this:
The average American still trusts a contractor about as much as they trust a used car salesman. 

Going forward, the successful companies will be those who figure out how to distance themselves from the pack in a *major* and *meaningful* way.

By *major* and *meaningful*, I don't mean having glowing client testimonials on your website, or hollow statements about how you're the best, cheapest, most reliable, cleanest cut, shiniest truck havin' contractor on the planet. That stuff is on every web site, flyer and and brochure out there, and means very little to the average consumer.


----------



## Jason Whipple (Dec 22, 2007)

HomerJ said:


> I remember reading a thread about a month ago where someone posted something along the lines of "what worked before will work again when this crisis passes".
> 
> While I understand the thought process behind that statement, I'm not so sure we can just wait it out, tighten our belts and be ready when the HO's start calling again.
> 
> ...


You have the right idea there, "a major and meaningful way"


----------



## Mike Finley (Apr 28, 2004)

Wow, you guys are predicting major changes, world turned up side down in construction.

My prediction is by this time next year none of you will be doing anything different and your predictions will exist only here as a year old thread on contractor talk.

Financing is gone and never to return? New construction will never return to what it was?

Whatever boys. Your predictions of the death of everything you know are very premature. Nothing has changed other then a temporary hiccup.

People still live in houses, some people will still like only a new home in a new neighborhood, some people will still want a pre-owned home in an established neighborhood, after people buy a new home or a pre-owned home or just spend another year in the home they've owned for 20 years, it will still turn older every year and sh*t falls apart, rots, breaks and goes out of style, nothing has changed.


----------



## A.W.Davis (Oct 17, 2006)

Mike Finley said:


> Wow, you guys are predicting major changes, world turned up side down in construction.
> 
> My prediction is by this time next year none of you will be doing anything different and your predictions will exist only here as a year old thread on contractor talk.



x2......sky is falling mentality is growing old. Things will turn around soon enough. 

I think a good book for people to read would be this
http://www.thomaslfriedman.com/bookshelf/the-world-is-flat


----------



## silvertree (Jul 22, 2007)

I'm with things will change, nobody said it would be bad.
You guys may run a perfect business, but that puts you in a minority.
Change can be good, and I think its coming. Or I'm wrong.


----------



## Mike Finley (Apr 28, 2004)

silvertree said:


> I'm with things will change, nobody said it would be bad.
> You guys may run a perfect business, but that puts you in a minority.
> Change can be good, and I think its coming. Or I'm wrong.


What does that even mean?

Nothing has changed. Illegals will still be involved in our industry unless dramatic changes are made by our government. Financing is still availalbe and will be. Home equity loans are still available.

What are you guys predicting? Robots will be building kitchens and baths? New homes will be shipped from a factory in China?

About 2 years ago every major inustrial trade mag began the crys of green home building. Well customers aren't willing to pay for anything green once they find out it costs more. So much for that.

Once house walls were chinked mud between logs, then we had plaster, then we had drywall... 

rough saw lumber.... glue lams... metal building... ICFs... 

so what?


----------



## Double-A (Jul 3, 2006)

It ain't easy out there, but this too shall pass. We've been busting ass making good money on all our jobs and we're still booked. 

I have two friends in this same business. Both are on the brink of failure. They say they are having to lower their prices to get jobs, that home owners don't care about anything but the bottom line. I tell them that's hogwash and treating your client like a mark will just get you in the poor house sooner than later. Unfortunately they are proving me right. They complain and *****, but they continue to operate as if the talking heads on the news actually have a clue and know what they are talking about. People are people. That will never change. Treat them right, and they will do the same for you.

We haven't substantially changed the way we operate, other than to be sure that we work hard to stay on budget and keep the client well informed of all aspects of the job.

I can't see that changing anytime soon.


----------



## Bill Z (Dec 10, 2006)

An old, retired contractor told me this about 25 years ago.

"When things are really, really good.. don't get too excited, 'cause they'll get bad again. 

And when things are really, really bad, don't get too excited, 'cause they'll get good again. 

Just don't get too excited."


----------



## macatawacab (Jan 1, 2009)

We already are changing. Marketing to niches, specializing, using technology that we could not have imagined just a short time ago. We ride around with GPS to find addresses, emailing on the Blackberry, pulling up real time data and generating quotes on the laptop. 

Look how many threads are about SEO. Did that happen 5 years ago?

Look at Silvertree's WOW truck. Meeting customers where they are. Changing the paradigm.

It does not seem to me that anyone on CT is waiting around. We are all looking to get better. How many members did CT have 5 years ago vs now? On CT we have a national forum. It interests me to see contractors from everywhere communicating in real time. That is major.

I can't even fathom where we will be 5 years from now. Suffice it to say, there are huge opportunities in this industry for the inventive.


----------



## rbsremodeling (Nov 12, 2007)

macatawacab said:


> We already are changing. Marketing to niches, specializing, using technology that we could not have imagined just a short time ago. We ride around with GPS to find addresses, emailing on the Blackberry, pulling up real time data and generating quotes on the laptop.
> 
> Look how many threads are about SEO. Did that happen 5 years ago?
> 
> ...



The contractors on this site are not the average bears. 

Unfortunately I see and deal with the other 90% who can not run a company, market it and chew gum at the same time.


----------



## silvertree (Jul 22, 2007)

When I say I see change I don't mean robots doing trimwork. Or buying trailer homes from China.
Construction has always been a sloppy industry, not all, but enough of the guys doing the work. Our standards are standard only to some of us.
I believe credit will be tighter and standards will improve. It will be harder to get into the business. I expect some changes in how we present our prices.
Just so you don't go down the wrong path, I am an optimist, I am already changing some of the "acceptable" things I did, acceptable isn't good enough anymore.
If we can't raise the bar as a country were screwed, you may be a shining example of how to run your business, but as I said before your in a minority.
People will pay more for Green if they understand the benefits, again it will be another change we are building up to.
I think we can get cynical about this change and call it a gloom and doom give up attitude, or we can start to work for understanding that a change could be made to work for the good of us all.
Today AIG announced its still giving 100 million dollars to its execs for bonuses, that was our last economy, if we keep doing that our problems will get worse. 
Don't take a hope for a better future and tell me it will all be normal again, because normal is what got us here.


----------



## macatawacab (Jan 1, 2009)

Paul, you just jogged a favorite quote from Hunter S. Thompson "when the going gets weird, the weird turn pro".


----------



## Teetorbilt (Feb 12, 2004)

Too much to say and it's bedtime. The window is up until tomorrow.


----------



## Halo (Oct 3, 2007)

I cant help but think this whole last 12+ years was a set-up. Trying not to get anymore political than that, the current illegals will eventually be legals. Entire generations have come to expect anything they want with easy credit. And they feel no remorse for anything which they seem to be able to personally justify. 

Many of the ones I see going backwards are actually going to end up where thier socio-economic profile would actually put them. They have been riding fat horses and eating steak, while being subsidized. This has created an entire pecking order/house of cards that will tumble. And to add further degradation the foundation of the family and its natural values has been under attack on every front in this country for along time. You do not have to look far to see where "stimulus" priorities have been alotted. It is by design. The sky is falling?...it is a matter of facts.

Things will certainly change going forward, History and phrophecy tell us that. Time will move on and new paradigms and generations will preside. Some of us may rightfully say "the sky is falling". Others, particularly younger whose historicall perspective is less, may not think so as their vision is different. This applies to every segment of society.


----------



## pcplumber (Oct 12, 2008)

*This is funny!*



ChainsawCharlie said:


> Where we're going, and how we'll get there.


These were the exact first thoughts I had when I read the title of this thread.

The construction industry is dependent on population growth so start having more babies. I think this recession is going to last 10 to 20 years. By then you new babies will be ready to move in to your new houses.


----------



## ChrWright (Jul 17, 2007)

pcplumber said:


> ...increasing the population. I just need a few volunteers.


 

I'll bet that line works with all the ladies... :thumbup:


----------



## silvertree (Jul 22, 2007)

I am going on a bid tomorrow morning, small kitchen makeover. That's good news to me. Here's how I see this, if I get the job I kill them with exceptional work and excellent service, hand them a gift card for referrals and hope I can get a run going. I think I got lazy and from now on its all or nothing. That's my new economy, all or nothing. It's easy to say you gave 100%, but few people actually even try.


----------



## kevjob (Aug 14, 2006)

Paul exactly the same approach I have been using, my appts are now running 75 to 90 mins with all the brochures pictures manuals etc.. all or nothing. 

Tell me about the referral gift cards? Do you have them made for you?


----------



## scuba (Feb 26, 2008)

I am one to believe that things will get better sooner rather than later.

I also believe that there will be an awakening of the middle class (our biggest market). They will need to realize that the days of overspending on their remodels is over. The days of most of our customers upgrading everything is over. Frugality will rule. This will be the largest market. There will be exceptions but saving will be important. The days of having the best of everything, the best bathroom, the showroom kitchen are going to have to wait awhile. The basics (with solid products) are going to be the mainstay. Most of these grand remodels in an average home will be completely unaffordable. Those kind of projects will be the last to resurface for the middleclass.

But, as was said earlier, every home continues to decline and needs to have money spent on upkeep. The amount of money the homeowner has or can get is not near as much as it was.

The American consumer is spoiled.

Our challenge is to give them what they can afford in a tastefull, appealing project, and be the guy that builds it for them.

Greg


----------



## silvertree (Jul 22, 2007)

The gift cards I bought from that Keith guy KBX gaffixs?, other guys on CT like Jesse "The Handyman" use them. I just started giving them and people like the way they look. I have a $100 and $200 card with no restrictions. In other words if I give you one and you give it to a relative I'll honor it, no time limit. I think the gift cards will be one of those things I wish I did a long time ago. I have 1000 and I don't leave home without them.
My cards look like credit cards. Very cool with my website color and Silvertree logo.


----------



## kevjob (Aug 14, 2006)

I use Keith too, have you had success with them or rthis omething new? I am looking at more ways of getting referrals.


----------



## ChrWright (Jul 17, 2007)

scuba said:


> They will need to realize that the days of overspending on their remodels is over.


How do you define overspending? If you serve your client well, they should never overspend--no matter what the economy is doing. Any business transaction is an exchange of value. Property value and comfort--form and function--they are the driving forces of any home improvement. It is a bit of a stretch to think that the American consumer is going to change overnight (or a few years) into embracing the Spartan lifestyle. If the client derives the experience they want from the results of their project--it's not overspending--especially if the project has been balanced to deliver the greatest improvement to their property's value. 




scuba said:


> The days of most of our customers upgrading everything is over. Frugality will rule. This will be the largest market. There will be exceptions but saving will be important. The days of having the best of everything, the best bathroom, the showroom kitchen are going to have to wait awhile.


From where do you draw this conclusion? We are a society of consumers and we will always spend on the things that are important to us. We have been conditioned to want the the latest and greatest and to enjoy a better lifestyle than those who came before us. 



scuba said:


> Our challenge is to give them what they can afford in a tasteful, appealing project, and be the guy that builds it for them.


That was the same 10 years ago, and will be the same 10 years from now.



http://www.chicagotribune.com/business/columnists/chi-fri-burns-good-economyfeb06,0,3757873.column

http://www.bloomberg.com/apps/news?pid=20601087&sid=abzZrsUa2fUE&refer=worldwide

http://www.jchs.harvard.edu/publications/remodeling/remodeling2009/index.htm


----------



## Mike Finley (Apr 28, 2004)

Some Good news -----


*National housing starts released for Feb - Up 22% over January. (1st up tick in 6 months of falling)*

*National building permits up 2.2% for Feb (1st uptick in 7 months)*

Don't look now but that's called good news. Hope we don't get any more of that. :laughing:


----------



## rbsremodeling (Nov 12, 2007)

Ok here is some good news. 

I closed a design/build contract this week for 540K. Whole house remodel using google.

*Paul* should get a kick out of that one. 

I do the walk through on Wednesday for measurements and complete scope of work:blink:


----------



## thoscon (Nov 28, 2007)

rbsremodeling said:


> Ok here is some good news.
> 
> I closed a design/build contract this week for 540K. Whole house remodel using google.
> 
> ...


I didn't know that you could do a whole house remodel with google! 

Hope the general public doesn't find out! :jester:

Seriously, congratulations on the job.


----------



## rbsremodeling (Nov 12, 2007)

thoscon said:


> I didn't know that you could do a whole house remodel with google!
> 
> Hope the gneral public doesn't find out! :jester:
> 
> Seriously, congratulations on the job.


If you only knew:laughing:


----------



## scuba (Feb 26, 2008)

Hi ChrWright,

Maybe overspending is the wrong word but the point I'm trying to make is that for a while there money was easy to get and the average person spent it without regard to their future or how they were going to pay it back. There are a lot of smart people out there but there are a lot of people that didn't think things through. We are always concionsce of the money spent by our customers. Can you honestly say that not one of your customers who borrowed the equity from their home to pay for a project is now not upside down on their home loan. Is that serving your client well? The gravy train was rolling and all the homeowner had to do was get the money and some contractor would do the work. Not to say that we are supposed to be our brothers keeper.

Maybe you're right with the american consumer not going spartan. I don't think those are the people who will be the target of our marketing. It will be the consumers that have to get the work done in an economical way that we will focus on. They have to spend the money because they have to have a functional bathroom or kitchen.

The frugality conclusion is from the phone calls we've been receiving and from my own feelings. Maybe things will change in a few years but right now the moneys not there for most people. Those that have to have all the best stuff will have to save for a bit. There are exceptions and responsible people who are not hurting financially but I think the majority don't have the extra bucks or are saving them for the unknown future.

I think the conditioning has just hit reality.

Thanks for the comments

Greg


----------



## dirt diggler (May 14, 2006)

scuba said:


> Maybe you're right with the american consumer not going spartan. I don't think those are the people who will be the target of our marketing. It will be the consumers that have to get the work done in an economical way that we will focus on. They have to spend the money because they have to have a functional bathroom or kitchen.


Greg, maybe this works for you already (and if it does, great!)

It's great to have a target market ... but I'm curious as to you are putting your attention towards consumers that need work done in an "economical" way

Why do you see a demand in this?

Was a there a widespread epidemic of shower leaks and Maytag appliance failures???







Or, are you taking a stab in the dark?




you do know that in order to serve an "economical" market ... you _will_ have to increase efficiency, increase volume --- and you'll have to sacrifice craftsmanship. No such thing as "high quality" in an "economical" market. "Pass-able" quality is more like it.


----------



## silvertree (Jul 22, 2007)

I'm not tellin! but we've just entered a new age:laughing:

You da man!


----------



## Mike(VA) (Jan 9, 2008)

ChrWright, thanks for the links. Long, but interesting reading in this one:

http://www.jchs.harvard.edu/publicat...2009/index.htm 

However, they are heavy on stats but light on what they think will happen to the business model itself. Market movement towards rental rehabs, immigrant housing, and sustainable building. I can see the rental market, sfh's and multi's, but what is there to immigrant housing? They are just another demographic buying houses. Nothing new. Sustainable building? Green is in but as someone said some posts back, it is costly and will deter most customers for now.

What the article only tangentially commented on was the fact that the remodeling industry is fragmented with little consolidation. They didn't say if that was going to change. 

I PM'ed Jerrald to see if he wouldn't mind weighing in on his comment; hope he does. Any other 'consultant' can chime in for that matter.


----------



## dirt diggler (May 14, 2006)

silvertree said:


> I'm not tellin! but we've just entered a new age:laughing:
> 
> You da man!


this "new age" wouldn't be an "I'm going to lower my prices and increase my quality" kinda age ... is it??


----------



## silvertree (Jul 22, 2007)

dirt diggler said:


> this "new age" wouldn't be an "I'm going to lower my prices and increase my quality" kinda age ... is it??


Not at all, but were not going to raise our prices and lower our quality either.
I'm just an old Hippie who misses dancing naked with girls in a cloud of blue smoke while barking at the moon.:rockon:


----------



## dirt diggler (May 14, 2006)

silvertree said:


> but were not going to raise our prices


if there's been a time in the past 6 or 7 years where you needed to raise your prices, it is now ....


----------



## scuba (Feb 26, 2008)

Heck Dirt, you made me go to the dictionary to look up economical (Websters - 'marked by careful, efficient, and prudent use of resources').

The demand I think is reality, common sense, etc.

I remember back before this last economic uptic when I would have a customer that wanted to redo their bathroom, had 5 kids, didn't want fancy, just bombproof.
Skip ahead a few years and those same type of people had an equity loan, credit cards ready to charge on and thought nothing of upgrading to nicer stuff. We all know how much more you can easily spend on a simple project when you go for all the bells and whistles. Easy money made that possible.

Kitchens and bathrooms are still going to need attention, they don't last forever. People that have to do the work (everyone eventually) and that don't have the money to burn will need to be prudent. The people that are unfortunate enough to need the work done now when they have to be prudent with their money, are the ones that will have to be 'economical'. 

To me, economical does not mean cheap.

Yes, you have to be efficient (narrow your focus).

Sacrifice craftmanship - NEVER - won't happen.

I think you misunderstood me with the economical thing. I never meant that we do cheap work.

In this market, it's the guys who have their acts together from sales to job completion that are going to smoke the competition and come blasting out of this recession all the better for wear. If nothing else this economy is forcing all of us to be smarter and more efficient. At least those of us who will succeed.


----------



## silvertree (Jul 22, 2007)

Raising prices is done for many reasons, if you have slippage you raise to make margin, raise your price is you have too much work, raise if your not supporting yourself, but raising prices in a slowdown is not something I think will work for me.
So Dirt, if you think its time to raise prices, then why is that?


----------



## Mike(VA) (Jan 9, 2008)

Scuba, you make some good points, however, you and others are missing my point. There are going to be a lot of people who do not have the equity, collateral, or the means to get a loan for projects. There are a lot of people right now who are saying they want to keep their income below the high-tax threshhold either through lesser paying jobs or compensation deferrement plans. That will affect how much money some can spend. 

Yes, maintenance work will still need to be done and many will find a way to pay for it. What won't be back for a long time is the large amount of discretionary spending on upgrade projects and the like. That spending accounted for a lot of business for some of us and in my OP I questioned how that was going to affect the way we do business.


----------



## rbsremodeling (Nov 12, 2007)

Mike(VA) said:


> Scuba, you make some good points, however, you and others are missing my point. There are going to be a lot of people who do not have the equity, collateral, or the means to get a loan for projects. There are a lot of people right now who are saying they want to keep their income below the high-tax threshhold either through lesser paying jobs or compensation deferrement plans. That will affect how much money some can spend.
> 
> Yes, maintenance work will still need to be done and many will find a way to pay for it. What won't be back for a long time is the large amount of discretionary spending on upgrade projects and the like. That spending accounted for a lot of business for some of us and in my OP I questioned how that was going to affect the way we do business.


Mike I agree with you 100%. A lot of my customers make 100k+ a year sometimes their wives do to. The spending from them is not like it use to be. 

I don't care what any of the other guys here say that type of spending is done for a few years for most homeowners. My average job last 5 years was 100K.

This year it will be 10-30K max average. 

That's a whole lot of selling to make up the gross/profits from years prior. I am upbeat and not worried and will survive. It still is a tough situation for all of us.


----------



## dirt diggler (May 14, 2006)

silvertree said:


> Raising prices is done for many reasons, if you have slippage you raise to make margin, raise your price is you have too much work, raise if your not supporting yourself, but raising prices in a slowdown is not something I think will work for me.
> *So Dirt, if you think its time to raise prices, then why is that*?



*"Because rarely does anything bad ever come from raising your prices."*

- Dirt Diggler, 2009


quote me on it :laughing:


Paul - gimme a few - I'll write my real answer here shortly


----------



## Mike Finley (Apr 28, 2004)

rbsremodeling said:


> I don't care what any of the other guys here say that type of spending is done for a few years for most homeowners. My average job last 5 years was 100K.
> 
> This year it will be 10-30K max average.


Well with a 540K job thrown in you are going to have to do whole lot of $100 and $200 jobs to bring your average down to a max of 10-30K. :whistling


----------



## silvertree (Jul 22, 2007)

dirt diggler said:


> *"Because rarely does anything bad ever come from raising your prices."*
> 
> - Dirt Diggler, 2009
> 
> ...


Actually, I like that answer a lot:thumbsup:


----------



## rbsremodeling (Nov 12, 2007)

Mike Finley said:


> Well with a 540K job thrown in you are going to have to do whole lot of $100 and $200 jobs to bring your average down to a max of 10-30K. :whistling


 540K job is a drop in the buck. I need to make up for the last 6-8 months of minimal work.

I need to do 2.5-3 Mil this year with some decent markups. We are in March almost into April already by now I would have done 300-400k.

I need a few more of those larger jobs to make up for the down time and they aren't many of them out there yet.

Overhead is higher than most on this end, I don't operate out my momma's basement.


----------



## Jerrald Hayes (Apr 24, 2006)

Mike(VA) said:


> In the thread titled "WAG or SWAG", Jerrald Hayes said:
> The construction industry is full of inefficiencies and waste and we are behind the times when we compare the services we offer in to those offered by other industries and consumer demand will drive change down the line. And let's face it the new construction market will never come back to what we saw going on in the last couple of years nor should it. The building and remodeling industry as we know it is due for and in for a major remodeling.
> 
> Jerrald, if you are reading, could you expand upon your statement?


Hello Mike, and thanks for telling me about this thread. I can see I have a lot of reading to do to catch up on but I have had a busy two days and I still have a busy week ahead of me too so I'm too tired tonight to expand on and explain my original comment but I will try to get back to you tomorrow if I can. 

But one thing I think I can give you to think about as far as what I said about "_consumer demand will drive change down the line_." A consumer can order a $45 worth of books from Amazon and choose their shipping method and then track their package as it is assembled and then shipped across the country and delivered on time. 

Meanwhile these same consumers can spend many tens of thousands of dollars on their kitchen remodel and they get told it will take six weeks and they see only fours weeks of total effort (time) with their project sitting idle at times and it still takes eight weeks instead of the six they were told to complete their project and they have no way of tracking the progress themselves. 

I think that is just one of the ways consumer demand and pressure that is inspired and driven by what they see in other industries, will force us to change and become better project managers. Some companies will recognize that calling and deliver on it but many wont and I think the ones that do will thrive and survive while the others will fade to the outer fringes of the market or just vanish completely.


----------



## rbsremodeling (Nov 12, 2007)

Jerrald Hayes said:


> Hello Mike, and thanks for telling me about this thread. I can see I have a lot of reading to do to catch up on but I have had a busy two days and I still have a busy week ahead of me too so I'm too tired tonight to expand on and explain my original comment but I will try to get back to you tomorrow if I can.
> 
> But one thing I think I can give you to think about as far as what I said about "_consumer demand will drive change down the line_." A consumer can order a $45 worth of books from Amazon and choose their shipping method and then track their package as it is assembled and then shipped across the country and delivered on time.
> 
> ...



Here is something I agree with you on Jerrald. Try as I might I think I fail big time in doing this. We have good communications skills, email and call our clients to keep them in the loop. But I think it is far from what it should be. With all the technology available to us now as contractors we should be doing more in the communications and scheduling areas

That is on my plate of things to do. But sadly I don't see it happening till late summer after the peak. I do have some Ideas of what needs to happen though.


----------



## Mike(VA) (Jan 9, 2008)

Thanks, Jerrald. Waiting to here from you when you have time. Should be interesting.


----------



## ChrWright (Jul 17, 2007)

rbsremodeling said:


> I don't care what any of the other guys here say that type of spending is done for a few years for *most *homeowners.


The point I would make, to those of you with solid reputations who give excellent value and craftsmanship, is that we don't need work from MOST homeowners to survive and thrive. There are still homeowners with money out there. Stop thinking on such a macro level and figure out how you can target and position yourself for those who still have money to spend and still appreciate quality.

Nearly everyday I'm asked, "How are you doing these days" by subs, clients, other builders, etc. I quietly nod my head and with as humble a tone as I can muster tell them we are doing very well (and knock on whatever wood is handy). The reasons are threefold: the neighborhoods we are positioned in, the network of designers and clients we've worked for, and the quality of experience we work hard to deliver each and every day on our projects. 

Reputation, reputation, reputation. Of course every project is important. If you haven't treated every client like gold--then you've no right to ask why things are slow right now. I hear many guys talking about changing the way they do things and wonder why they're talking about things they should have done all along. I mean no offense to any of you in saying that, and don't mean to ruffle any feathers. I don't know how you run your business or how you treat your clients--but if things are slow, you may want to look inward and not just at the present state of the economy.

Everyone wants the magic bullet--the instant tip to mountains of prospects waiving money at you to build them things. When I still taught martial arts, many of our students came wanting to learn the flashy techniques you see in movies. But to be a great fighter, the basics are all you really need. In football, it's not fancy plays that win games--it's blocking and tackling. The basics aren't hard to identify in any business--but they are often overlooked and under appreciated for their power to build long term success.

And to Digglers point of raising prices, some thoughts to ponder:

If you're surviving the downturn, and will be around to serve your clients' needs and stand by your work for many years to come--doesn't that have value? 

Are you really any better at what you do than the guy who has a sign two doors down from you is? If not....why? 

If you are better, are you charging more than he does? If not, why? 

How are you demonstrating that superiority to your prospects and clients?


----------



## kevjob (Aug 14, 2006)

Excellent points Chris I was just pondering that very sentiment of looking inward to see how I can improve communication and become even more efficient in all areas. I believe I was lax in refferals and that area will be improved from here on out.


----------



## silvertree (Jul 22, 2007)

If what Chris says is correct, then we should be marketing to those that care if we will be here in 5 or 10 years. Sears gets those customers and so does Home Depot. Like it or not, many people will pay more for a Sears kitchen than one of mine and I have been around for 20 years as Silvertree.
They simply think that with Sears if something goes wrong it will be warranteed. Nothing could be further from the truth, but that's what these people think. Why is that? Its because of all the fly by nights we compete with on price. We all get bunched into the same bag.


----------



## Mike(VA) (Jan 9, 2008)

Paul, you know most industries have done a poor job educating their client base. We are no exception and I look to all the national business and trade organizations out there for some help. Won't happen, but one could hope. How many of these orgs actively try to strengthen consummer laws to keep out hacks and illegals, target homeowners with education programs to help them learn the value of professional contractors, seek to ENFORCE minimum standards with regards to contracts and training, and operate as an advocate for us at the national level?

Certainly, some orgs do a better job than others, but, let's face it; most of them are out for themselves and many times have an agenda that is not in sync with their members. Until things change, we have to do the job ourselves and we are usually outgunned.


----------



## silvertree (Jul 22, 2007)

Tell me about it, take our local NARI. There's the country club members and the rest of us. I think my NARI membership is nothing more than political correctness when they say the organization is for all, when in truth it's better for the directors and their friends.


----------



## scuba (Feb 26, 2008)

ChrWright said:


> The point I would make, to those of you with solid reputations who give excellent value and craftsmanship, is that we don't need work from MOST homeowners to survive and thrive. There are still homeowners with money out there. Stop thinking on such a macro level and figure out how you can target and position yourself for those who still have money to spend and still appreciate quality.


Thanks for pointing this out. It is very true.

It seems that most of the calls we get are budget minded people. They simply don't have a lot to work with. We don't lower our prices or labor, but we work hard to fit them into their budget.

Sorry to Mike if I went off subject.

Greg


----------



## dirt diggler (May 14, 2006)

ChrWright said:


> The point I would make, to those of you with solid reputations who give excellent value and craftsmanship, is that we don't need work from MOST homeowners to survive and thrive. There are still homeowners with money out there. Stop thinking on such a macro level and figure out how you can target and position yourself for those who still have money to spend and still appreciate quality.
> 
> Nearly everyday I'm asked, "How are you doing these days" by subs, clients, other builders, etc. I quietly nod my head and with as humble a tone as I can muster tell them we are doing very well (and knock on whatever wood is handy). The reasons are threefold: the neighborhoods we are positioned in, the network of designers and clients we've worked for, and the quality of experience we work hard to deliver each and every day on our projects.
> 
> ...


a man after my own heart


(my god that sounded so freakin gay :laughing::laughing


seriously though ... 


"magic bullet" - sums it up well. Business is NOT a complicated animal. 






I'm telling ya'll ... there is too high of a SUPPLY of contractors and that supply WILL decrease --- read my see-saw metaphor. Change your businesses, give yourselves a makeover all you want.

*The SUPPLY of contractors right now is high and that supply will decrease because the DEMAND is low for that quantity of contractors.*


10,000 door hangers and a fancy website, Angie's List, 5 books on how to be a sales wiz WILL NOT change that. 


As ChrWright says, stop worrying about the "fancy" halfback-fake-pass plays. Business is not a complicated matter. It's just that there MUST be a demand for you business to exist. Plain and simple.




As for raising prices, my explanation for that (Paul - it's in another thread, btw - i did not forget about you) is simply the fact that many of us will not have the same volume of work that we are accustomed to having. You cannot charge less and work less and expect to maintain. 




Bottom line guys, stop worrying so much... and learn to *FOCUS*


----------



## silvertree (Jul 22, 2007)

Dirt, this is for you and everyone who cares. 
First, I am optimistic for my future and the future of the trades in general.
I always took good care of things, but I feel I should get better and I will.
Less customers and charge more, because I'm worth it, I agree 100%
I pretty much agreed with everything you just wrote.
I also believe we are entering a new era, sure we'll slide back a bit now and then, but make no mistake, if Americans don't change their spend and file bankruptcy - I'm a victim - life's not fair - were all equal ways, were doomed. Well, their doomed anyhow, and screw em.
I'm going to have food I paid for on my table. In any economy!
And Chris, I treat my customers like gold also. I'm slow, but its mostly because I stepped back to take account of life in general and decide to change my core business to kitchen and bath, my timing sucked a little.


----------

