Table of Contents April 2006

VIEW POINT

FIRST WORD

• A Healthy System

  Remodelers are getting irritable, and with good reason: looming lead paint regulations, proliferating “smart-growth” restrictions, rising workers' comp premiums, and month-long waits for permits. In fact, remodelers are fit to be tied about every conceivable type of regulation, fee, or tax, but when I ask their opinion about a single-payer health insurance system, I get an earful about the evils of socialized medicine. This, despite the fact that it is nearly impossible for them to provide a basic health benefit to their employees at a reasonable cost.

   

News + Notes

• Growing Pains

  In an e-mail to his contemporaries, Bethesda, Md., remodeler Mark Scott recently wrote, “Our local city council has become strongly anti-growth.” He continued to write, “I assume it's in response to public opinion,” and it's easy to imagine many of the recipients of the correspondence nodding their heads in vigorous agreement.

   

MARKET WATCH

• Figure This

  Statistics and figures from the industry data.

   

• Local Forecast: Beating the Backlog

  Keith Steier says his company, Knockout Renovation Svcs., New York, had 13 appointments to look at projects during the first part of March. That's 30% more appointments than they had the whole month one year ago.

   
• 

  RMI Drops Below Benchmark

  The final Remodeling Market Index (RMI) of 2005 showed a slowdown in the fourth quarter. The year as a whole was positive— though somewhat below the level of 2004.

   

COMMENTARY

LINDA CASE

• From the Top

  Three strategies for staffing your company with happy, intelligent, moral, and supportive employees: First and foremost, you, the owner, must be happy, intelligent, moral, and supportive. It's imperative that you model the desired behavior.

   

MARK RICHARDSON

• Myth Busters

  In life there are many myths. Some, like Santa Claus or the Easter Bunny, provide a benefit to our upbringing. Others create fear or anxiety, like the notion that flying is dangerous (it's actually the safest way to travel). As we mature and become wiser, we should replace these myths with facts that help us keep things in perspective and make better decisions.

   

SHAWN MCCADDEN

• Evolution vs. Revolution

  Do you ever wonder why your business is plodding along when the remodeling business down the road, which began around the same time as yours, is booming? It can be frustrating when two remodelers appear equal at the outset, but the scale of success eventually tips in one company's favor.

   

GUEST COLUMNIST

• 

  Dust Might

  There's no avoiding dust in a remodeling project, and with the pressure of possible litigation and liability claims, regulations, and customer demands, you need a way to control it. Remodelers can't be concerned with just dust, though; they're also responsible for protecting workers and customers from health risks associated with hazardous dust exposure. And, they must always be mindful of the bottom line.

   

YOUR BUSINESS

Ways + Means

• People + Skills: Deep Background

  Hiring the right people is a tough job. Every prospective employee works hard to present a fantastic first impression. Someone who doesn't frequently hire can be fooled into hiring the wrong person. It's important to use every tool to dig beneath the enthusiastic veneer to get to the real person underneath. One tool increasingly used by business owners is a background check.

   

• Work + Life: Work Buddies

  Is it ever OK to hire a friend to work in my company?

   

• Skills to Build On

  At Teevan Restoration's Christmas party last December, while Benjamin Ladomirak orally recognized his employees for their hard work, Dr. Pilar De Olave stood nearby and translated his words into Spanish.

   

• Back to Basics

  Everybody has his or her own way of doing something. But, Chris Donatelli says, when you're trying to systematize, this kind of idiosyncratic behavior can lead to inefficiency and confusion. “Our way isn't the only way,” Donatelli says about him and his partner Tony Castillo, “but we're selling a particular product and a particular standard,” so there needs to be consensus on method.

   

• Personality Plus

  A few years ago, Jeff Titus began using personality profiles for all new hires and existing employees to help staff communicate better. At the same time, to help employees understand why the company was doing this, Titus, owner of the 12-employee Titus Built in Wilton, Conn., says, “I thought it would be good for them to evaluate [my personality].”

   

BOTTOM LINE

• Health Care Cost Study

  According to an August 2005 study titled “Cost of Employee Benefits in Small and Large Businesses,” by the Small Business Administration, companies of all sizes have reduced the availability of health insurance to their employees due to the growing costs associated with benefits in recent years.

   

• Building Credit

  Business Credit Services offers small-business owners a plan to separate their business from their personal credit. The Business Credit Builder kit uses audio CDs, DVDs of seminars, and five workbooks to walk business owners through the steps of building business credit.

   

• Health Insurance Survey

  A new report from America's Health Insurance Plans (AHIP) says that health insurance premiums are growing at a reduced rate, despite increased use and higher costs, while health insurance plans' efforts are easing drug cost increases.

   

Sales & Marketing

• Sales School 101: Working with Negotiating Cultures

  Get used to it. “Most of the world negotiates everything,” says Michael Lee, a multicultural marketing consultant. As your market becomes increasingly diverse, your growth may hinge on homeowners from the “negotiating cultures” of Asia and elsewhere.

   

• Ice Smashers

  The initial meeting with a prospective client is too important to rush into your sales pitch. “It's all about bonding and rapport,” says Bruce Curtis of Washtenaw Woodwrights, Ann Arbor, Mich. He typically devotes 5 to 15 minutes to small talk before steering the conversation toward the real purpose of his visit.

   
• 

  Marketing Workshop / Before+After

  Shortly after launching Thomas Pruitt Builders in 2003, Tom Pruitt started work on “The Sunrise,” a newsletter intended to introduce his company to 200 or so past clients from a previous employer. “A newsletter sounds great in theory, but it took a lot to put together,” says Tammy Morris, office manager of the Charlotte, N.C., company. Even with the help of a graphic designer, Morris and Pruitt spent months writing copy and reviewing drafts.

   

FIELD NOTES

• Windows How-To

  Andersen Windows' new “Replacing Windows” two-DVD set demonstrates how to install full-frame and insert windows in a variety of real-world scenarios. Free to remodelers, the DVDs offer a case-study analysis of every stage of the window-replacement process, from initial assessment to final cleanup.

   

• In the Loop

  Miles sometimes separate the three field and three office employees of Almar Building & Remodeling, Hanson, Mass. But they stay in touch via “paycheck notes,” newsy pats on the back that owners Terry and Allison Quinn insert into each employee's weekly paycheck envelope.

   

• Got Workforce?

  As labor-strapped remodelers and builders get serious about attracting new blood to the field, “growing your own” is taking on new meaning.

   

BY DESIGN

• Now Screening

  There is nothing like a screened porch for enjoying a bug-free summer evening or watching a rainstorm in dry comfort. These three porches solve homeowner needs and enhance their surroundings.

   

Tech@Work

• 

  Upgrade to QuickBooks 2006?

  The latest offering from Intuit contains few new features. Instead, Intuit has focused on some structural and interface changes, with improved usability, particularly for a new user. Whether users of a previous version will find it worthwhile to upgrade to 2006 is really a personal choice: Aside from navigation and underlying file structure, there aren't a lot of improvements in terms of new abilities or options. But consider these factors:

   

GOOD FORM

• 

  Tracking Workers' Comp

  Sometimes, the simplest forms are the most effective. This Excel spreadsheet — which Riggs Construction & Design, Kirkwood, Mo., uses to track the money the company spends on workers' compensation insurance — is meat and potatoes; columns of numbers, tallied using a basic Excel function. But, says Pam Hagerty, Riggs' office manager, it saves her time (she used to tally this by hand) and she has all her ducks in a row when the company is audited each year.

   

FEATURES

• Commercial Counsel

  After a quick glance at the high-rise office buildings and road projects, the prevailing wage and bonding requirements, the copious codes, and the penalty clauses common to commercial building, the prospect of applying anything useful from the non-residential sector to a residential remodeling business seems remote.

   

• Insurance 101

  Consult with your insurance broker for additional information on these and other common types of commercial insurance. More detailed explanations are also available at www.insurancebuzzer .com operated by Scott Simmonds of Insurance Consultants of Maine.

   

• Insurance Reassurance

  Remodelers are facing one of the most unforgiving insurance markets in years. Slammed by soaring premiums and multiplying exclusions, impenetrable contracts and fleeing providers, they're struggling to afford and hold onto good commercial policies that won't leave them high and dry on the rare occasions they actually need them.

   

Before & After

• 

  Before+After: Their Best Interests

  Over the years, remodeler Bo Steed has found that the architects he has worked with usually have little to do with a residential project once the clients bring Steed Remodeling their plans. But that wasn't his experience when he worked on a kitchen-and-bath remodel near his office in Kansas City, Mo.

   

BIG50

CLOSE UP

• 

  Profile: Larry and Elaine Taylor

  After nearly 35 years in the industry, Larry Taylor, and his wife and co-owner Elaine Taylor, are beginning to hand over their company to their two children, Lisa and Trent, but they're keeping their hands in the business by teaching others what they've learned.

   

SECOND LOOK

• 

  Second Look: Mason Hearn

  When Mason Hearn bought the final shares from his partners and became sole owner of McGuire, Hearn & Toms in Manakin-Sabot, Va., he decided they needed a name change, in part to make the company as a whole the focus. But in addition to a new company name and a new logo, Hearn found himself with a new company structure and a new role as well.

   

SOLUTIONS

• Q+A: Solution

  Recently we hosted our first-ever open house. It was related to our project being published in Sarah Susanka's latest book. We held it at the house featured in the book so that our clients could see our work and celebrate with us.

   

FACE OFF

• Should you share information with your competition?

  Remodeling is not just a business for me; I am passionate about it. When placed in a group setting and given a topic that interests me, I can expand on it with perhaps too much detail. I will relate the strategies and measures that my company has taken to solve a problem or to get a leg up on the competition. People have shared good advice with me over the years, and I in turn would like to help others.

   

Live + Learn

• Hardknocks: Trust-busters

  Hilliard Contracting, Raleigh, N.C., ran on trust and goodwill until late one Friday afternoon in 2002, the year the company became Big50. Owner Steven Hilliard had just met with a client whose whole-house remodel was about 75% complete. His purpose was to deliver the unfortunate news that their project, which they had hoped to do for $220,000, was on schedule to cost closer to $330,000.

   

• Reading List

  A Big50 remodeler recommends a favorite business book.

   

KITCHEN + BATH

DESIGN CLINIC

• Effective Use of Small Products

  Kohler's Diana Schrage says the clean surface of an undermount bath sink visually expands a space. Another option is to use a glass bowl sink such as those in Kohler's Vessel line.

   
• 

  Small Wonders

  New-construction and remodeling clients are willing to sacrifice square footage in individual bathrooms for the chance to increase the total number of bathrooms in their homes. Kohler designer Diana Schrage says it is possible to fulfill the homeowners' desire to have a bath with every bedroom.

   

• Installation Tips

   
• 

  Drawer Logic

  Ten years ago two appliance manufacturers introduced products to fit the changing lifestyles of homeowners. Sub-Zero refrigerator/freezer drawers and Fisher & Paykel dishwasher drawers kicked off a trend in convenience that continues with new product offerings, including microwave and wine drawers.

   

SPEC BOOK

• 

  K/BIS Preview

  The Kitchen/Bath Industry Show returns to Chicago April 20-23 with a full offering of educational opportunities, hot new trends, and, best of all, cool products for your customers. Here is a sampling of just a few of the faucets, cabinetry, bath fixtures, appliances, and other wares sure to wow you this season.

   

REPLACEMENT

DOORS

• 

  Wind-Resistant Garage Doors

  In a major windstorm, such as a hurricane or a tornado, it's the windows and doors that usually hold a house together.

   

SIDING

• 

  A Step Up for Vinyl

  Vinyl, America's most popular siding material, continues to gain ground against costlier, higher-maintenance claddings. Originally a budget and mid-market alternative, today's premium options offer promise for the upscale replacement market.

   

PRODUCTS

TRENDS

• 

  What's Cooking

  From the looks of it, the 2-Oven Aga Cooker (shown in pistachio) doesn't appear much different from your average range. But it is.

   
• 

  Roll Up the Hose

  If you like the convenience of a pneumatic nailer, but hate dragging a compressor and hoses through your clients' living rooms, your options for going hoseless are growing.

   
• 

  Open Invitation

  When Ebrahim Nana and his brothers founded Nana Wall Systems in the late '80s, there were just three or four small companies that made sliding and bi-fold glass wall systems, he says. Today, according to Nana, his Mill Valley, Calif., company has more than 50 competitors.

   

Reader's Choice

• 

  Making the Cut

  Having set his first tile when we was just 10 years old, Bill Vincent knows the importance of having a dependable tile saw.

   

IN FOCUS

• 

  Roofing

  In addition to the ability to self-extinguish when exposed to fire, the CRRC-listed FireShield Roof Restoration System reduces energy costs by creating a surface that reflects sunlight.

   
• 

  Home Tech

  The Intelligent Load Center combines an electrical load distribution enclosure and automatic transfer switch, eliminating the need for a second distribution panel and additional wiring for a standby generator, the company says, and thereby lowering installation time and costs.

   
• 

  Pinned Down

  For fine woodworking, the finish carpenters at Troost Bros. use nothing but SENCO's FinishPro 10 Micro Pinner, president Jeff Troost says. The pneumatic nailer weighs just 2.25 pounds and drives 1/2-inch to 1-inch 23-gauge micro pins. According to Troost, the tool is so accurate that upon nailing,

   

LAST WORD

Benchmark

• 

  The 1% Solution

  A new client bet me that he could increase his gross profit margin from 24% to 28% in six months. Laughing, I told him that it couldn't be done — in 15 years of working with remodeling companies around the country, I'd never seen anyone capable of increasing their field efficiencies to that degree in that short of a time.