Financial Management

Ep.32: Industry Insights with Rick Strachan

If you’re curious as to where the remodeling  industry is going and the key opportunities for the future, Rick Strachan of Hanley Wood has your answers.

In this episode, Rick breaks it all down with Victoria and Mark, telling you what will drive growth, and how to face the coming challenges. You’ll get the big picture, detailed information to help you make strategic decisions for your future, and more numbers than you can shake a stick at.

Rick has worked in the media and information business serving the construction industry for 35 years, and for the last 26 years has been with Hanley Wood’s Remodeling Group. He is a founding member of the Harvard Joint Center Remodeling Futures Program, and is a past board member and former chairman of the Home Improvement Research Institutes Remodeling Professional Committee. He has also received NARI’s President’s Award for service to the industry.

The biggest drivers of remodeling, now and for the near term, are the Baby Boomers. Rick tells you what you need to know about this generation’s buying power and habits, as well as:

  • The predicted habits of Millennials in the remodeling space
  • The phenomenal growth in the industry and why the future looks bright
  • How to address your labor shortage
  • Why product and materials costs will escalate, and how to deal with it
  • Why HGTV isn’t all bad for business
  • What our aging housing stock means for you
  • And much more…

This episode is as close to fortune-telling as we can get. If you have any questions for Rick, you can email him at rstrachan@hanleywood.com. For more information about Hanley Wood and its news and information about the remodeling industry, go to their website.

Summit Partners

We are proud to partner with Rick and his team at Hanley Wood on producing the Remodelers Summit and we’re excited to get down to New Orleans for this year’s event. We only have 5 seats left for Summit so if you haven’t registered yet, please do so ASAP. You do NOT want to miss this year’s event!

Ep.31: How to Successfully Use Cost-Plus Pricing with Josh Baker

The Cost-Plus Pricing model seems to go completely against common sense, but it’s a concept that we’re getting more questions about from our membership. One contributing factor is that consumers increasingly demand transparency when purchasing products and services — and homeowners are coming to expect it when undertaking a remodeling project. But so many remodelers don’t understand it. Can Cost Plus be your new pricing model?

Josh Baker, co-founder of BOWA Builders, has been using Cost-Plus Pricing for more than 20 years. In this episode, he talks to Victoria and Mark about its pros and cons, and why it’s a cornerstone of his company’s success.

Josh founded BOWA Builders in McLean, VA, with college friend Larry Weinberg in 1988, serving the Washington, DC, metro market. As the leader of BOWA’s sales and marketing team, Josh helped to quickly grow the company’s revenues from $250,000 to nearly $40 million in just 20 years. As chief revenue officer, Josh’s focus is on growth and managing an energetic, productive sales team. Recognized nationally as an expert in the industry, Josh is quoted regularly in publications, including The Washington Post, Better Homes & Gardens, and Remodeling, and is a frequent speaker at local and national industry meetings.

Cost-Plus Pricing can be a differentiator, but it can also frighten some remodeling business owners — as well as some clients. Josh explains how to present the concept to clients, and what it will take to implement it profitably, as well as:

  • What jobs are suited to the Cost-Plus Model
  • Weighing the risks and rewards
  • The necessity of pinpoint accuracy in estimating
  • Why not to apologize for your costs
  • The time it takes to do well
  • Why you need a sophisticated, expert sales staff to make it work
  • And a whole lot more…

Josh stresses that Cost-Plus Pricing isn’t for everyone, or for every job. Listening to this episode may help you decide if it’s the pricing model for you, or for some of your projects. Check out BOWA’s website for more about the company, and if you have questions about Cost-Plus Pricing, send Josh an email at josh@bowa.com.

 

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Ep.30: How to Create a Financial Plan with Sacha Millstone

Business plans, marketing plans, any plan serves as a map to a goal. Your financial plan is no different.

You need to set your goal, write it down, and commit to it. Our Roundtables members do this regularly for their businesses. But too many people get anxious when it comes to looking at their personal financial plans, says guest Sacha Millstone, a financial planner and wealth manager.

Sacha discusses how to get past the anxiety about your personal financial planning with Victoria and Mark in this episode.

Sacha started the The Millstone Evans Group in the Washington, DC, area in the late 1990s, and now has a team of 10, with offices in Washington, DC, Denver, CO, and Boulder, CO. She has helped hundreds of clients achieve their financial goals by creating a written plan and helping them put it into place.

When you’re running a small business, you can get so absorbed in your work financials that you avoid looking at your personal situation. But you have to, says Sacha. And while you can do a financial plan to get you to retirement, it’s difficult. There’s so much emotion around money that you may need someone to advise, coach, and hold you responsible.

There’s so much good advice in this episode! You’ll learn:

  • The magic of compound interest
  • Why not to use the word “budget”
  • Where your investments are — and what to add
  • Why insurance — especially for yourself — is so important
  • How to mitigate risk in your investments
  • What the Monte Carlo analysis is
  • And a whole lot more…

You’ll also hear why Victoria’s idea of summer fun for kids includes financial quizzes. This episode breaks down the importance of financial planning for remodeling business owners in ways that will make you think differently about the whole subject. It’s never too late to plan.

For more information about Sacha, her business, and how she can help, go to the Millstone Evans Group’s website. If you have questions, drop her an email at sacha.millstone@raymondjames.com or give her a call at (800) 201-4554.

Ep.28: The Dos and Don’ts of Implementing Technology with Donny Wyatt

Technology is critical to boosting efficiency and ensuring scalability for remodelers and builders, but tech isn’t the answer to everything. It’s hard to know where to start, and what problems tech can solve for you. Too often, you purchase an expensive program, people don’t use it, and it gets shelved.

In this episode, Victoria and Mark talk the dos and don’ts of tech with Donny Wyatt, the founder and CEO of CoConstruct, a web-based project management system for custom builders and remodelers.

Back in 2005, Donny was a homeowner who had a typical, but frustrating, building experience, and used that inspiration to create a web-based system to help custom builders and remodelers serve their clients better. Today, CoConstruct has been named the No. 1 software of its type by SoftwareAdvice and Finances online. Donny leads a team of nearly 100 employees serving 5,000 customers across North America and beyond.

The biggest key to successfully implementing a software solution is to start small, advises Donny, and pick one or two key problems to solve. Then use your sales skills to get buy-in from your team, concentrating on one or two key players — a driver and a curmudgeon. Donny tells you how to do that, as well as:

  • Figuring out what problems you need to solve
  • How to get past the human speedbumps
  • The positive side effects of the right software
  • Why a tech problem may really be a leadership problem
  • Using tech to make your clients’ experiences outstanding
  • When to keep going through a puddle
  • And a whole lot more…

This is lively episode packed with information you can use today. You can learn more about CoConstruct with just a click.

Just like our remodeling industry audience, Rave Reviews are the lifeblood of any good podcast…

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And as always, if you have a topic that you would like us to cover or know of an industry contact, author or thought-leader that you think others would like to hear from, let us know.

 

Ep.27: How I Quadrupled My Revenue with Todd Jackson

Growing your company requires thinking big, developing innovative strategies, and taking risks. If you do it right, the results can be huge. Todd Jackson did it right, and quadrupled his revenue.

In this episode, Victoria and Mark talk to Todd about how he achieved that success, and the details and work behind the big numbers.

Todd is the CEO and president of Jackson Design & Remodeling in San Diego, CA, and a long-time Roundtables member. During the recession of 2007-2009, he developed and adopted strategies that got the company these amazing results in the next decade.

Learn how Todd not only weathered the downturn, but put systems in place and doubled-down on his marketing to power his company when the economy bounced back. He talks about the importance of creating a culture that celebrates success, as well as:

  • The key advice he got from another Roundtables member
  • Why his salespeople love their lower commissions
  • How his showroom drives profits
  • His strategy to cut the design process from months to weeks
  • Financing vs. cash
  • The awesome power of wearing slacks
  • And more…

There’s no one magic bullet, but a cohesive mix of strategies, calculated risks, and goals that will speed a remodeling company toward exponential growth. Click through to see more about Jackson Design & Remodel.

You don’t want to miss this episode!
 

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Ep.25: Open Book Management with Ken Kirsch

The thought of showing your financials to your employees may be unsettling. We’ve known remodelers who are so leery of sharing their numbers, their field crews don’t even know their project budgets.

But it doesn’t have to be that way, says Ken Kirsch, a proponent and practitioner of Open Book Management. In this episode, Ken tells Victoria and Mark that showing your numbers will engage and motivate your team — while helping your bottom line.

Ken is the president of MAK Design+Build Inc. in Davis, CA. Drawing on his experience as a carpenter and an artist, he and his wife Ellen started MAK Design+Build in 2003, out of an Airstream Trailer in their driveway. Ken’s a member of Roundtables group Krypton, and was introduced to the concept of Open Book Management at his very first RA meeting.

Victoria and Mark talk with Ken about the positives, and one surprising negative, he’s experienced since embracing Open Book Management. They discuss:

  • What to show and what to avoid
  • Focusing on the Big Picture 
  • The importance of your team being financially literate
  • When and how to discuss your numbers
  • Engaging your employees for lower turnover
  • And a whole lot more…

Transparency in business is much more than a buzzword, it’s something your employees will seek out more and more. Find out how Open Book Management can make your business better. Click here to see more about MAK Design+Build.

As promised, here is a shot of the AirStream that Ken got started in

 
 

Ep.17: Building a Sustainable Family Business with Wayne Rivers

According to the U.S. Bureau of the Census, roughly 90% of U.S. businesses are family-owned and the Remodeling industry is well represented by closely-held firms, typically started by a founder and then handed down through multiple generations.

Family-owned businesses often run into obstacles and challenges, usually driven by “soft issues” such as communication, emotions, past conflicts, bringing spouses into the business, etc. However, what many of these struggling firms lack is a common vision or mission from a business perspective.

In Episode 17, Victoria and Mark welcome Wayne Rivers, President of The Family Business Institute, to the show to discuss more about his unique approach in working with these types of businesses.

Wayne’s approach is very different and he talks about his tried and proven, step-by-step strategic planning method for maximizing BOTH the success of a business AND their family harmony.

Wayne is a well-known thought-leader, speaker and author on the subject of family-owned businesses; his latest book is Our Family Business Crisis: and How It Made Us Stronger. Wayne is a Wall Street Journal Expert Panelist and has appeared on the Today Show, CNN, MSNBC, CNBC and the Retirement Living Network.

Victoria, Mark and Wayne discuss the Institute’s unique way of working with their clients; topics include:

  • Identifying reasons why family-owned business struggle
  • Transitioning from one generation to the next
  • The importance of the founder establishing vision early and often
  • The dangers of working AT the business instead of working ON the business
  • “The Magic Bullet” – Business planning methodology and subsequent positive side-effects
  • Going in through the “business door” vs. “family door” when dealing with conflict
  • Dealing with and resolving “soft issues” families face when working together
  • Describing a few steps in the Institute’s 10 step process of working with businesses
  • And more…

A great episode regardless of whether your company is family-owned or not. Many of the concepts discussed about business planning methodology will apply to any business, regardless of ownership structure.

We loved having Wayne as a guest… and we’re even more excited to have him as a featured speaker at the 2018 Remodelers Summit in New Orleans in September.

If you are interested in working with Wayne, his Information is below:

Wayne Rivers
President, Co-Founder
The Family Business Institute
4050 Wake Forest Rd, Ste 110
Raleigh, NC 27609
877-326-2493
Website: www.FamilyBusinessInstitute.com

Ep.13: Buying Out Your Business Partner with Rick Goldstein

Business partnerships are a foundation that so many of our R/A Roundtables Members have built their remodeling businesses on… Whether it’s a family or a group of professionals coming together to form a business, each has its own story along the way.

In episode 13 we take a closer look at a scenario where one partner wants to buy another out and take sole ownership of the business. Victoria and Mark welcome Rick Goldstein of Mosaic Design + Build to the podcast and discuss the process that Rick went through recently to buy his partner out of their firm in Atlanta, GA.

Rick has been the Co-Owner, and now sole owner, of Mosaic for more than 12 years and has been an avid member of the Remodelers Advantage family for many years. Rick and his partner made the decision to move toward a buy-out years ago and Victoria and Mark discuss and ask about the challenges they ran into and lessons-learned along the way.

Victoria, Mark and Rick talk more about:

  • Developing a shareholders agreement – covering ownership transitions, scenarios, exit strategies, etc.
  • Obstacles to overcome (timing, emotional steps, valuation, etc.)
  • Bringing in consultants such as a business valuation firm to get an agreed-upon base line
  • Factors that are calculated in the valuation process
  • How roles and responsibilities play-in to the buy-out process
  • Getting accountants and attorneys involved to hammer out how to physically make the transition
  • Communicating to the company’s leadership and team regarding the process
  • Top three pieces of advice for any owner looking to make this transition

Whether you are considering this move for your remodeling business or not, Rick’s story is fascinating and definitely worth a listen!

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Ep.07: Is an ESOP Right For Your Remodeling Business?

When it comes to succession planning and determining an exit strategy from your remodeling business there are plenty of options to consider.

Many of our Roundtables members have either sold or handed their businesses off to the next generation, for example… but all of them will tell you that making that determination early in your company’s lifespan can be critical to the success of your plan.

In today’s Episode of PowerTips Unscripted, Victoria and Mark explore an area of succession planning that is somewhat new to the remodeling industry, by talking with Anthony Mathews, a thought-leader in the area of creating and maintaining ESOPs, or Employee Stock Ownership Plans.

Anthony has spent the past 40 years helping business owners and employees transform their companies into communities of stakeholders through the creation and maintenance of ESOPs – many of them for construction companies. Most recently Anthony has spent the last decade at the Rady School of Management at the University of California, San Diego, teaching future business leaders and advisors.

Anthony describes what he refers to as a “Succession Crisis” in this country where closely held companies get to the end of their life span and simply close or liquidate. When that happens, the owners may (or may not) receive full value in the business, employees lose their jobs and towns and cities are faced with yet another business that is no longer a part of their business community.

Anthony, Victoria & Mark discuss:

  • What type of company sets up an ESOP? Size? Number of Employees? Characteristics?
  • What is the process of establishing an ESOP?
  • What are some of the challenges companies face?
  • What makes an ESOP different than a 401K, Profit Sharing or other plan?
  • What are the Tax Advantages that companies and employees will see?
  • How does having 10-30 owners effect the company culture?
  • Anthony’s 4 phase process of determining if an ESOP is right for a business

Is an ESOP right for your remodeling business?

If you are a current R/A Roundtables Member, Anthony has offered a FREE initial consultation to help determine if an ESOP is the right solution for your company.

Anthony can be reached using the following contact information:

Anthony Mathews
Rady School of Management
University of California, San Diego
Office: (858) 822-6010
E-mail: amathews@ucsd.edu

Ep.03: Top Financial Challenges Faced by Today’s Remodeling Business Owner with Doug Howard

Episode 3 takes a deep dive into the financial challenges that remodeling business owners face on a daily basis. Victoria and Mark welcome Doug Howard, Remodelers Advantage Director of Consulting to the PowerTips Unscripted studio.

Doug Howard is an entrepreneur, government official and small business consultant with more than 25 years of experience in leading organizations and assisting clients in many different industries.

After working with remodelers from across the US and Canada, Doug shares his thoughts on challenges such as:

  • Cash flow issues
  • Planning and budgeting for growth
  • Recognizing success patterns in your business
  • Stair-stepping growth (adding personnel & resources)
  • LEAN Process improvement and how it relates to production & cash flow
  • Identifying signs that you are growing too fast
  • Ownership structure: Partnerships, relatives, married couples, etc.
  • What to do when things start “going south”

Doug’s alternate job title at R/A is “The Fixer” and that becomes apparent as he shares his experiences in working with remodelers and providing his Five Words of Wisdom. Doug survives the Lightning Round with some key insights as well as a great book recommendation… Enjoy!

Thanks for Listening…

Please share your comments about Doug’s thoughts and advice below and if you have any questions for Doug, or you are interested in learning more about how Doug can help you with your business, contact him at doug@remodelersadvantage.com

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