Transcription
Today I want to share with you a secret that I learned working with 3,000 contractors. The best construction business owners are not contractors. And in this video, I'm going to show you how the best and the biggest construction companies are ran. And they're actually not really run by the construction people. Of course, you're going to have the contractors and the project managers and all these people. But how's the business structur? How are they doing it? What's the method? What's the strategy? How are they getting their leads? How are they structuring? How are these companies able to be multi-million dollar corporations, multi-million dollar companies, while you and I are trying to grow the business, trying to figure it out? Like, how are they doing versus how are we doing it? And today, we're going to dive deep and I'm going to show you how you should be running your company.
Before I started, I am Builders, I was a project manager for a commercial drywall company. And I literally witnessed firsthand a company go from struggling to become a $7 million a year commercial subcontractor here in South Florida. So trust me, I know exactly what's starting at the bottom is. So when I started at that company, they were purely a labor company. They didn't even have their own jobs. And somehow, I don't know how to this day, but the owner, Paulo, he convinced me to leave my career superintendent job to come over and join his $20 million vision. Like, one day he literally told me, Danielle, I want to take my business to $20 million. And it turned out that they were this tiny little construction company where a lot of their revenue was coming from renting out their labor to other bigger drywall contractors. And they were just starting to get their first projects. And it's funny because I remember one time in one of the job sites, he was like super stressed out. Once he literally looked like he was ready to throw in the towel. He's like, freaking out. And I remember I told him, I go, well, the thing is that you're doing everything yourself and you should build a team. This is what I've seen other construction companies doing. So why don't you do the same thing?
So a few months later, on another job that we had together, I see him a completely different person, excited, motivated for his company. It was like his demeanor completely transformed. And I go, Paulo, what happened? What's different? He goes, I listened to you. I hired a few people and my life is completely different. And he pulls out his Google Sheets on his phone and he's like, look at all these jobs. The truth is that over the course of my career, it's not that I'm this super genius. It's just that I actually listen and I pay attention and I learn a lot from what my clients are doing. I learn a lot from observing other people. And I've always been very business-minded. So about a year or so after that, he used my own advice against me. He was building his team and he wanted me on his team. And that being said, for him, it was a temporary sacrifice of a salary. For him, but it allowed him to sell more jobs, to run better operations, which led to repeat business. I'm always talk about repeat business, right? If you do a good job on the job site, they're going to want to use you again and again and again. If you don't do a good job on the job site, this is probably your last job with these guys. So because he listened to me, he did the operations the right way. He had his crews, he had his general superintendent, he had his superintendent, he had his project manager. And that led to him selling more jobs and selling more repeat work.
So the first person you're going to need is the estimator. So the estimator, this is your rainmaker. This is the guy that's going to bring money in the door. One of my newest clients, AR our construction, they just joined us about 3 months ago. They didn't have an estimator. The owner is a business owner, he wasn't that great at estimating. He didn't have a big team, he didn't have a lot of stuff in place to take him to the next level. So he was kind of stuck. So he joined us about 3 months ago. We started finding him leads, helping him negotiate those jobs, we bid those jobs, we estimated them for him. And he closed in 3 months, he's already closed $73,000 in contracts. By the way, we do estimating for our clients. We do leads estimating. So if you need help in that area, I'm going to put a link here above here somewhere so you can go ahead and do that. And I'll put in the description too.
All right, so you could get an employee in-house. You can go hire somebody. Go find somebody on indeed, remote, or get somebody like out of construction management school or something like that. The temptation is to hire a young kid because they're cheaper. They know computers, right? And nowadays, estimating and these sorts of things are based on software. It's not like printing the plans anymore. But these construction management guys, they're going to come out of school wanting $70 and $80,000 a year and they don't know anything. The point is that construction management majors, they want to be in construction, but they're kind of expensive and they're not, they're very green. Now, I'm not going to lie, hiring an estimator is a mission. It's a very challenging thing. It's, you got to have experience. You got to be in the field. You have to have understood construction logistics. You have to understand field conditions. You have to understand adjustments based on regions. There's a lot of things to consider when you're doing estimating. And it's not just clicking lines on a software and plugging it into like an Oncenter or a PlanSwift or whatever software. You have to know how to do it. My professional recommendation for you is to hire a qualified estimating firm. Boom, that's the magic. That's the secret. That's how you're going to scale your business. Right now, in the future, there may be a place for an in-house estimator that can do like sales and things like that for you. But for a lot of you guys watching this video, you need to start and you need to start bidding more. So you need a qualified estimating firm. Now, keyword qualified. The temptation is, there are a lot of estimators out there that are overseas. They claim to have US addresses. And if you do a Google search of construction estimating services, a lot of those guys show up around our own search results. But these guys are not from here. And you can tell because if you just have a phone conversation, you're going to see that they're not from here. And it's not that being a foreigner makes you not a bad estimator. It's that you have to know how to do the work here. Like I can't go do an estimate in like India or Canada or South America because I'm not qualified. I might know how to click the buttons, but I'm not qualified. So I will never be able to do that. That's why one of the things that we've made an effort on, we've worked with 3,000 contractors nationwide. We've done since we started $5 billion in estimates. We've worked on projects like the US Embassy in Jerusalem, other embassies around the world. We've done military projects, we've done university projects, we've done even projects that high-profile projects that I can't really discuss. We've done a bunch of different types of projects. So if the government trusts us, then maybe you can too. So we carry an errors and omissions insurance that covers all of our projects in the event we make a mistake. So with us, we back up our work, we warrant it, it's 100% covered. So that's one of the benefits of working with a qualified estimating firm. By the way, before we jump into the next one, go ahead and put your comments below. Tell me how you're doing your estimating. Let me know what your thoughts are if you should outsource, if you should do it in-house. Let me know what you think in the comments below.
All right, number two. The next person you're going to need on your team is the general superintendent. You're going to need a superintendent to run your jobs. And you're going to need a general superintendent to oversee the whole operation. Okay, so that's how we were doing it in commercial drywall. But one of my clients named Matt Hensley, out of Arizona, he's doing $20 million a year in construction. And this is his unique system. So he's a majority partner for his company. And he has two other partners. He has a guy that runs the field 100%. A general superintendent that his whole job is to run the field. And he has another guy that his job is to train new crews. He recruits them and he trains them up. He has like a 16-week curriculum that he trains them up. And he gets them in basically active duty. Now, you don't have to give up 50% of your company to do this. You can actually go out there and hire an experienced superintendent. Or you can promote from within one of your guys that are doing a great job, promote them up. So now you want to make sure that whoever you put is good at people skills, good at managing, they can handle job site meetings. Very important that they speak English. A lot of times our crews, you know how construction is, everybody speaks in Spanish. You got to be able to hold a meeting. You got to be able to go to a job walkthrough. You have to be able to go and handle job site meeting issues in English, or at least broken English, but at least some sort of English so that you're not needed. Because if this guy doesn't speak English, then you're going to have to be going to all the job sites. So this is why it's very important. So either you promote from within, or you're going to go hire a $100,000 a year experienced veteran that has at least 20 years in the game that can run the field without needing you at all. Notice my my main keyword here is they run the field without you completely. One of the biggest challenges, this is a $100,000 a year salary if you're going to hire someone has those 20 or 30 years of experience. So it's a little bit of a steep price, but it's worth it and it's necessary.
All right, so so far we've talked about our estimator and our general superintendent. So if you think that's a good thing, like the video and subscribe so you can get notified every time we release another video.
All right, the next person is the project manager. Me? No, not me, but someone to run your operations. What's going to happen is if you're kind of like doing a few hundred, or million dollars a year, you're not going to have the salaries for all these people upfront. That's why I started with the rainmaker and the guy that's going to run your jobs. Right? Those are the two very important people. Those are the two people that you need to replace yourself instantly. What's going to happen is now as you get more work, and you are going to land more work because now you have a rainmaker, you have an estimator, you're going to also have someone running those jobs. Now you're going to be free to meet clients and all that stuff. You're going to land more projects. So you're going to start getting busy on your project management. And project management is anything that's related to the contract, the contract scope of work, the money, the payment applications, the change orders, all that stuff is contract management. So anything that's contract management, you're going to have to run yourself in the beginning. But then you're eventually going to start noticing that you're going to start missing purchase orders, you're going to start making mistakes, you're going to start taking long to get change orders in, things like that. You're going to be missing important details. At that point, it's going to be necessary for you to hire a project manager, someone that's going to come in and run your jobs.
All right, so here's a good thing for this role. You can actually hire a younger construction management major or someone that is kind of like on the younger side because all they have to really know is how to use the software. And then all you have to do is train them on the game. Like, what do I do when my clients ask me for things for free? You change order them and you destroy them. No, just kidding. But not really. What do I do when my client doesn't want to pay my T&M tickets? Those are the things that they don't teach you in construction school. They don't teach you. You learn that on the job. Now, here's the pro tip. Don't hire an older guy for this role. Some of the older guys might be able to do this role, but for the most part, younger guys, they're quicker on the computer, they type faster, they they they can learn things quicker. And you can train them up in the ways of, you know, in your systems and processes. Also, there's a personality aspect to this. A project manager, he can't be a just a field guy and he can't just be an office guy. So what you want is you want a hybrid. Right? This project manager, he needs to be able to use the computer, go to the job site, be able to command the troops, right? Be the king of the savages. But also be able to go to the computer, spend two or three hours working on change orders and things like that, go to the job site, handle a job site meeting, come back, be able to coordinate with his superintendent. You know, he has to be able to do both. So it's very important that you get that personality. Let me know what you think about that. How are you guys doing your project management? Are you doing it? Put in the comments below. You have somebody doing it? Let me know what your thoughts are.
All right, the last person you're going to need is the bookkeeper. The next very important person you're going to need is going to be the bookkeeper and your accountant. So this person could be like an office manager, bookkeeper, accountant. It could be like a a hybrid of a couple roles. But this person is going to handle your administrative work and your money. And most importantly, your money. This is somebody that can review your QuickBooks, they can review your payment applications, your shipping tickets, your payroll. You don't know how many people I see, how many contractors fail because of money issues because they're too busy to watch their money. They're not paying the people on time. They're missing important payments that they have to make. They're missing their payment window for their payment applications. The worst thing is that the 20th or the 22nd of the month comes and you're so busy that you forget. And like on the 30th of the month, you're like, hey, here's my payment application. And you get that dreaded email that says, hey, I'm sorry, the billing cycle has ended. You were supposed to submit it by the 22nd. So we'll process this in the next payment application. Oh, not only are you going to wait those 30 or 45 days at the end of the month, and you're going to wait a whole another month to get paid. That's the worst. So make sure this person watches your money.
So the different areas that they're going to look at is, are your payment applications, cross-referencing your QuickBooks? They're going to be doing your employees payroll or your subcontractor payments. They're going to be depositing your checks. They're going to be following up on clients that haven't paid you. Very important. A lot of times you don't even notice. Yeah, we haven't gotten paid for this job for 3 months because nobody's watching. You need an air traffic controller. You also need to cross-check your shipping tickets. Make sure that what you're paying for is what was delivered on the job, right? So they typically have the invoice, then they have the shipping tickets. And then person's job is to cross-reference and make sure what the what they sign for in the field is what's what you're getting invoiced for. And lastly, anything else that has to do with money. Make sure that their main focus, please, please, is watching your money.
Now, let me ask you a question. If you were able to get training on how to correctly grow your construction business, would that be valuable to you? That's why I made my A-Figure Contractor program where we're literally taking contractors that have never even done a project in construction. They're in residential, they're in commercial, they've never done not even one project. We're taking these guys and we're taking them to a million dollars, $5 million, and $10 million. If that's something that you're interested in, in the link below, in the description below, there's going to be a 14-day trial. At the time of this recording, it's a 14-day trial to join our program. Check it out. Literally, I take you A to Z on everything you need to do to grow your business. My goal is to take you to $10 million. And it's not something that's going to be overnight. It's something that's going to take a while. And I want to be your coach for you. I want to be your consultant. I want to be your trainer. And I want to help you do that. So if you're interested, if you've gotten into this part of the video, that means you're serious about growing your business. Because to be honest, this video is kind of boring. I'm recording this and I'm like, oh, it's kind, it sounds kind of boring. But if you're here, that means invest in yourself, man. I'm telling you, invest in yourself. This is how you're going to grow your business. This is how you're going to go to the next level. So try it out. 14 days. Click that link in the description below. Or I'm going to put it up here somewhere. Watch the video. You're going to see it's going to be a good, you're it's going to be a good fit for you. And let's take your business to 10 million. All right, let's go.