Beyond $1,000,000 Podcast

Listener Q&A with Mike Katounas and Rick Holtz
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Scott: [00:00:00] Hey everyone. Thanks for listening to the Beyond a Million Dollar Podcast. We have a great episode today. I just got finished talking with two of our coaches here at Consulting4Contractors, Mike Katounas and Rick Holtz. We fielded some questions from contractors, just like you looking to pick our brains a little bit.

You'll hear what Mike and Rick have to say about what differentiates their companies from their competitors. You'll also hear a little bit about our thoughts on team communications and hiring. So with that, let's go for it.

My name is Scott Lollar, and I'm a 35 year veteran of the painting industry where I've been part of growing several multimillion dollar painting companies. I have worn all the hats and have experienced everything you have experienced, are experiencing, or will experience. There is lots of chatter about getting to a million dollars, but what very few focus on is what it takes to blast through death Valley and create the multi million dollar company of your dreams.

We don't focus on fads, tricks, or shortcuts. We focus on [00:01:00] solid foundational business principles and data that deliver results. This is the Consulting4Contractors Beyond A Million Dollar Podcast.

[00:01:09] Differentiating Your Company in Painting
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So the first one that's come in is what makes your company different?

Scott: What is the differentiator as opposed to just saying we do quality or we're insured those are features and benefits. Everyone does that. But what do you think makes your company unique and what do you think the customer thinks makes your company unique?

Mike K: Well, I've heard this question asked on social media, maybe more than once. And, you know, you get those typical answers of, well, we do quality work or we're priced better than others, or, we show up on time, that kind of a thing. And it's like, well, who wouldn't say that? So that's not really the question. It's more of like, what do you really do differently then everybody else.

And for us at Home Works Painting. I usually have three [00:02:00] things that another contractor that does like one of these but I don't think they do all three.

First thing is we background check all of our staff. Whether that's employees or our subcontractors, we make sure that we've gone through a background check to make sure there's no criminal history or anything there that would make us uncomfortable in having them in anybody's home.

We also provide a six year warranty. In my area I don't know anybody who does more than three years and that's even most of the warranties I see in my area are about one. When you see people's eyes when I tell them a six year warranty their eyes get kind of big and I've even had a couple of people make remarks that, they've mentioned that to the, to my competitors and the competitors kind of balk at it or they kind of laugh and they'll say something like, I guess that company is going to go out of business in the near future.

Here we are still. And the other thing we do, which I know some companies around in different parts of the country too, as we do all [00:03:00] consultations. They want to change the color, just have no idea where to start And so, we have a interior designer that is affiliated with Benjamin Moore, one of the local stores here and, we pay her to go out there. But we, it's kind of, under our marketing budget is the way I put it because it's something that helps us land jobs and I've had people tell me flat out that they were so grateful for the color consultation and how wonderful it was and helpful it was.

So for us, those are our three differentiators that separate us from our competition here.

Scott: Yeah, interesting. So how do you highlight those three things in your marketing and or your sales process so you know, you feel like you've listed three background check, warranty, and color consultation. So, is that something that you're really leaning on in your sales call when you're there? Or is there something in your marketing?

Tell me how you bring that up and how do you think it really [00:04:00] affects the sales process then?

Mike K: Well, we do have it on our website. So when people, look us up, they can see it, when they're doing, when they're reading through the website and seeing, anything a little bit more about us. Definitely a sales tactic that we use. The six year warranty really, comes into play for exterior work.

A lot of times I'll see people who, they'll say, Hey, I, you know, I'm going to probably sell about five years. I just want to paint it now. And then maybe I'll have to paint it one more time before , we sell. And I've had that exact conversation a handful of times and, I say to them, well, If you paint it now and you sell in five years, you won't have to paint it again because it'll be covered under warranty. As long as it's two coats.

That's the one thing I do stress. If it's just a one coat job that they want to cut down on the cost, then we still give it a two year warranty. if they put two coats on, we're going to give them that six year warranty. And so, people really like that idea. And I think it helps us sell more.

The color consultation part, I don't push right away. I kind of gauge [00:05:00] from the conversation I have. I went out to an estimate earlier today, the lady had her colors figured out. She knew exactly what she wanted.

She had, samples on the wall and was going and telling me, I want this color. I'm going to use that color.

But there are times where I will talk to people and I will say, have you thought about colors? Do you know, you know what, and not trying to nail them down on exact colors, but just trying to get a sense of, are they looking at a lot of colors? And sometimes they'll flat out start with, I don't even know where to start.

Can you help me pick colors? And I, and that's where I kind of go, I'm not a designer. And I can give you some general ideas, but if you're really looking to nail down your design , if you work with us, we get a designer in here and she will help you figure all of this out.

And so they get really excited about that. So, and every time when we do the sales pitch, we're definitely talking about background checking all of our guys and making sure that they can feel comfortable with the people who are working in their home.

Scott: Yeah. Interesting. We've talked about this before in other episodes, but you [00:06:00] do have some subcontract workers, and you're up front with your clients about that. How do you handle the background check in those instances?

Mike K: Well, we typically do a background check on anybody we know for sure is working with us. if they bring in a new guy or, you know, sometimes it might be a crew of three that we typically background check up front, but they might have guys that they bring along. So that part we, we do need to get a little bit better at in terms of knowing who exactly is going to be on each individual job.

And to be honest with you, I, I don't follow up very well. The initial crew of guys that we meet, we do, we say, Hey, we're going to need a background check. Are you good with that? And never had a problem with it. So then we know those guys are checked. It's just doing that follow up a guy here or there we need to do a better job on.

Scott: Yeah, so you are background checking your, subcontractors just the same.

Mike K: Yes.

Scott: Yeah, nice. Okay. Rick, how about you? What, What do you think, uh, a little different business? So tell me what, you know, what are, what would be yours at, uh, H. J. Holtz and Son?

Rick: [00:07:00] Well, you know, what comes to mind is just brand awareness in our market. People know our name. I mean, I'm the third generation in the business. So people know the Holtz name and equate it to quality, great service, customer service, great craftsmanship. And that's kind of hard in our market to really fight.

There's not a lot of other paint companies around that are like that. So, you know, I think of several things come to mind, like level of expertise, you know, we've been around for so long. There's not many issues that people could have at their home, dealing with painting that we haven't seen. So, you know, we're sort of the expert in our industry.

Longevity is another one, you know, because we've been around for three generations, we're not going anywhere. So people tend to trust us more because they're like, you know, if Holtz is going to come and do this job, we're going to pay more money. But they're not going anywhere. So if an issue arises later, [00:08:00] you know, we know who to call.

We're not struggling to find who is this person that painted for us? Where did they go? You know, that sort of thing.

[00:08:09] Professionalism, Tenure, and Communication in Service
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Rick: Professionalism. I think going back towards employees because we do mainly residential work. You know, like Mike said, he does background checks. We background check employees before we hire them.

The other thing we like to stress is employee tenure. You know, because we have employees that have been with us for so long, it, by definition, just kind of makes people know that, you know, they're getting professionals in our industry. They've been around for a long time. These are not people that are painting while they're in between other jobs and they're not necessarily new.

No, we have new people, but we're always going to have someone who's experienced and been with Holtz and knows how we. behave and work when we're at someone's home, because it's different. Working at people's homes inside and outside. Very different than painting a commercial building or, or any other [00:09:00] type of painting job.

You know, I think the other thing that I tend to think about is marked vehicles, marked employees. I mean, everybody knows when we're doing a job who everyone works for. And that name is something that we are all are protective of. Not just me, but my employees. Because that's, you know, they don't want anything to go wrong because if it hurts our reputation, that hurts their job security and it hurts all of it.

So we're all in it together. And I think, being branded, having marked vehicles, having uniforms, all that means a lot to homeowners. Gives them a, peace of mind for sure.

Scott: I also think that, you know, you two companies are in very different markets. One's much older, but I think in addition to Mike, at times is working with a somewhat of a transient, owner because of his proximity to D. C. So people that are in government, people that are in military, Pentagon, whatever.

So I think sometimes [00:10:00] people are hesitant to invest, you know, a lot of money into something that they don't know how long they're going to be there versus I think Rick's clientele is very stable. Just going to be there for a while, more willing to invest I would think in there. house because it's probably more of a permanent structure

Rick: Yeah. I mean, the other thing, we work for multiple generations of the same family, you know, and I don't know if that's very typical across the country. You know, I'm working for grandparents of. I'm working for grandparents, parents and grandchildren all in the same family. So it's like, why wouldn't you call Holtz? So it's different for sure. Our market.

Scott: Yeah. Yeah. The other thing I would say, because I know Mike's company, would be the level of communication. I would even go so far as to say overcommunication is the way we treat our customers, which is, it's not really negative. In other words, it's going to say, we're going to communicate with you a lot.

And I think that goes a long way because we don't have a lot of that in the [00:11:00] service industry. People show up when they want to. They don't really keep you updated. It's one of the things we talk about with our clients is, hey, someone signed a an agreement, and it's six or, six or eight weeks before you can get to them, how often do they hear from you?

I've had that situation where there comes a day where I'm wondering if my contractor's coming or if they remember me or, you know, you know, I just don't know. You just don't know. And so just, silence isn't bad. You know, you're still on the schedule, but they don't know. So I think it's another opportunity to touch the customer and say, Hey, we, you are on our thoughts, you are on our schedule.

We're looking forward to getting there. And, I think that communication, I know Mike does daily reporting, a lot of communication with the customer. And I think that's also, can be something that can be highly valued in today's market.

Rick: I think communication, like you said, Scott, is very important. One of the things I think about and is having people working at your house is knowing when they're coming and going.

Scott: Yes.

Rick: I don't know if you've had work done in [00:12:00] your house recently. Well, actually I do know you have. And I mean, I have too in the past year. And I never knew if people were coming, going, were they done for the day?

Were they coming back? And as a client, it's hard to relax. It's hard to feel secure when you don't know those things. So I think communication is super important in today's time, for sure.

Mike K: For us taking that tone from the moment they hang up on their initial call, you know, using the technology we use, YouCanBookMe and it goes into our calendar, right then there and we have it set up with like four different touches before we even walk into their home to do the estimate and it's one just confirming it right away.

Another one about 20 minutes later where it's kind of giving them a what to expect from us. Here's some information about us. Here's how you can look us up online and see the reviews that we have. Estimators going to what you can expect from your estimator when he or she arrives. And then. Mhm. We do a two day [00:13:00] before email and then one day before message.

And I've gotten comments in the past about, wow, you guys really make sure, you reach out to us. And I, you know, I always check and like, is that a little too much? And I haven't had any pushback in that way. And then it's the kind of comments where they'll say, you know, you must do that for a certain reason. Like, yeah, we want to make sure, you know, we're coming and that we've communicated with you.

And if anything changes, we're going to make sure we contact you right away. So. And it goes from there. So as someone who's also had work in my home done in this last year and dealing with a contractor who would like text me like two hours before on a Friday afternoon saying, Hey, we're gonna come by around six o'clock.

And I'm like, No, you're not. I got to go. I'm not, you know, like, you've got to give me more notice than that. And you know, a lot of my clients, they are parents,

and I've got sports after work. I've got things with my son and my daughter, whether it's events or games or practices. And I can't just be sitting at home, waiting for the guys to show up.

So having [00:14:00] that communication is vital.

Scott: I think that nothing's more frustrating. In my work, of course, I'm pretty much married to my calendar, and I'm on Zoom calls all day long. And so, you can't just show up whenever you feel like it, and it happens all the time. Landscapers, tree people, you know, there's no commitment.

And then they knock on your door and ask you what they're doing. You know, one of the things we used to be clear about is, you don't have to manage our team, we're going to manage our team. That's why you hired us. And I think one of the things that would I get from a person, if Mike was my contractor, is it would be evident pretty early on that this company is professional and I'm never going to wonder what's going on.

Now, if I pay a little more for that. Or if the price is double, you know, those are additional things we're going to talk about, but you know, this is the honeymoon, right? That you guys are, you're just courting and just to have that, that, you know, up front of going, wow, these people really are on top of their game, lays the groundwork that, that's probably not going to stop, [00:15:00] hopefully.

It's going to continue and that's going to be a good experience, which is really the best thing that you're offering. You're, a lot of people offer paint jobs, but the service is really what few people nail, I think. All right. Excellent.

[00:15:12] Business Growth and Strategic Role Challenges
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Scott: Another question revolves around as you're growing your company and, starting to think about hiring non production positions, who would be your first hires, your second hires, and et cetera, and why? And I think this would be very interesting to hear different opinions on this, but, Rick, why don't you lead on this one?

If you were, solopreneur, entrepreneur, you're working by yourself and you're ready to hire that first person. Who would you hire and why?

Rick: I think the first person I would hire is like a general foreman or a project manager or somebody to slowly take over the day to day planning of production. I think for owners, it's important for us to have a longer view of our business. And I think as long as [00:16:00] you're buried in the day to day, it's hard for you to get out of your own way and progress and grow if you want to grow.

As long as you're an owner and you're in the weeds and the day to day, I think it's a real hard. It's a hard barrier to overcome to grow. You can't it's hard to do both. It's hard to look two weeks, a month, six months, a year down the road when you're dealing with the day to day production fires that we experience is as paint contractors.

Scott: Following that position, would you, who do you hire second?

Rick: I would hire an estimator, second. I would hire an estimator second. Yeah, because I think if you want to grow your business, you've got to get out of those two main functions. And I think sales and production are two real important things. And to grow, you've got to be able to hand some of that off so you can really be more strategic about your business.

And, for sure.

Scott: Yeah. [00:17:00] Mike, how about you?

Mike K: So for me, the way I'm going to answer the question is more in general. And then I'll get specific is the first thing I would do is hire for what you're not good at, and you know, my first five years I was everything but the painter. I was fortunate that when I started in 2005 the more I came out the gates with two painters doing hourly work and I was self project managing and doing all my quick books and accounting and all that stuff.

And so five or six years into it, I brought my sister in law in to be my office manager. The one thing that was always hard is when you're in the middle of an appointment and your phone rings, you can't answer it. Because if you do, you know, you could lose that sale just off of that. And because you're now making that customer a second fiddle to your phone ringing.

And so, And especially at, this was right as we were starting to take off and instead of getting, you know, a couple of calls a day, I was getting more than [00:18:00] 10 calls per day and I just could not handle it, the call load. And so, I had to answer my calls, schedule all my

and I figured since I was since I was doing both sales and project management, I could continue to do both of these roles until we grew a little bit more.

Mike: As we did grow, the next position I initially thought about hiring was a salesperson because we were getting so many calls and we were turning people away. But as I thought about it a little bit more, it was, okay, what am I really good at?

And what am I not so good at? And sales was my stronger position. And so it was like, don't give that up and hand over the project management side of it. Cause I don't, that's something I don't really like a whole lot of. And so after having an established office manager, the next thing for me was the project manager, to manage the day to day jobs, kind of like Rick was talking about.

[00:18:51] C4C Is Here For You
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Well, we are about halfway through this episode of the Beyond a Million Dollar podcast from Consulting4Contractors, and we still have some great [00:19:00] content left for you before we get to that, though, I wanted to let you know about some resources that are available to you via the show notes. You'll find links to our website, social media outlets, and highlights of this show.

You'll even be able to schedule a discovery call with Scott and our team to find out how Consulting4Contractors can help your contracting business. It's very low pressure. We'll ask you just a couple questions, see what your current situation is, and then get you started toward the contracting business of your dreams.

The best part about it, it's completely free. So just click on the link in the show notes, or you can visit our website at www.consulting4contractors.com and reach out to us there. Again, that website is www.consulting4contractors.com. Now here's the remainder of the show.

Scott: I agree with those and the one [00:20:00] thing I would also say is if someone asked me that question straight up I would say What are, what's your superpower? Now most people that start a business have some amount of sales acumen, like they typically are the person that gets the job sold. And so that would be typically a pretty dangerous first position because you're probably that person.

You're the face of the business at this point. Without question you've hired some painters. So like Mike said you're not the production person, but to step away from the sales would be very precarious, in my opinion, unless you're no good at it, you know, and I've seen some people that are sufficient, but it's not their superpower, so I would, I'd be okay if that person wanted to be the project manager in the weeds, like Rick said, I guess I could be okay with it, but I do appreciate Rick's comment, which is you got to get your eyes up on the horizon.

If you're going to lead a [00:21:00] business and grow it, you can't just have your nose down is what I heard him

Rick: Yeah, the hard thing, though, as I sit here and reflect on my career, as I said to do that, but it's difficult because people know Home Works Painting is Mike. People know H.J. Holtz & Son as Rick. And then if they don't see Rick on the job, when the job's getting done, it's, is this job going to be a good job? Is Holtz doing the quality work that they did when Rick would come around and check on things, or are they getting the job they got when Mike would come around?

So it's not as easy as we make it sound. You're going to have clients that are going to want you to come by there that you need to see, they need to see your face. So it's. It's still a struggle sometimes and it's not that easy. So maybe some people might say, well, hiring an estimator is easy, easier because I can send somebody new.

These are new clients. Mostly a lot of times my legacy clients I take [00:22:00] care of. So maybe growing the business, an estimator would be a good route for you. It's really, it could be different. I don't think there's a right or wrong answer, I guess. And I think there's challenges with both for sure.

Mike K: Yeah, my biggest challenge as we were growing, would be repeat clients who were used to seeing me sell to them and stop by on the job to not seeing me and getting those emails or phone calls saying, Hey, I thought Mike was going to come by. I thought Mike was going to be the one doing the estimate on this, or I thought Mike was going to be the one to check in on the guys.

And, Yeah. I mean, that went on for a while and that was hard. And so that, that part, and you know, you're scared of like letting that go. Cause you hand that off to somebody and you got to realize they're gonna make mistakes. So you're going to have a repeat client who doesn't hire you. And maybe there was just something about the sales guy that just wasn't you.

You know, let's face it, a lot of people don't like change. And so when they crossed that barrier and decided to go [00:23:00] with you, you're not the one coming in their house. You know, it's hard for some people to, to swallow that. So that, that, that took me a little bit to get used to that.

Rick: And you can't, I mean, we all know you can't grow without pain. So there's going to be a level of pain. It's maybe measuring what's going to be the best thing for the business in the long run. And you just got to get through it. And you got through it. And so did I, it just, it's hard.

[00:23:28] Navigating Communication and Building Relationships
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Scott: I do think this is where communication comes in. I think about it as a dance, a waltz. If you do not tell a customer how the dance is going to go, then it would give them a chance to tell you or be confused. So I think this, the handoff and the confidence, you know, I think we've all been there where you're, you're an estimate and, you know, even when you were faking it, you had changed into a nice polo and you're wearing, you know, a nice pair of khakis and they're saying, and now are you the one going to.

Do this paint job and you're like, there's no way I'm doing it. [00:24:00] No, I'm not but you know, what do you say? You know, you can't you know, I used to kind of make a little bit of a joke about it like No I get we have some people way better than me or you know, say whatever you're gonna say But the idea what they're asking a question for a reason they're saying are you handing me off to some, you know you know that you don't know or how is this going to work?

And I think the idea of You know, honoring the question. Hey, fair question. Here's what we do. And, and, and Rick said it, you know, pretty nicely. I mean, he would have a, this would tee up beautifully for him as we have, our average worker has been with us 23 years and blah, blah, blah. He'd have a great answer for that.

And the same thing happens when they sign, you know, to hand them off to the operations department and say, Hey, now you're in my department. My goal is to have you get it, you know, have offer you a great experience. This is how we're gonna do it. This is the next steps Here's my number. Here's my email and my goal is that you have a great experience. Anytime you're not, let me know.

So I think those things can [00:25:00] be overcome with confidence and just letting the people know this is how this happens and I personally am a little bit more attracted to a professional organization than a owner operator because I just, I'm, you know, I'm glad for them to have a bigger organization and just be more dependable.

I don't want the sloppiness that I correlate with a ma and pa type of shop. So, that's just me, but that's what I think.

Rick: Well, in today's time where customers expect more quicker communication, quicker jobs, everything quicker. You know, I think we all feel, personally, the stress of just daily life in 2023. I'd much rather have an organization taking care of me that's well orchestrated than one individual, because we feel the stress in our own lives with all the things we have to handle. Personal, business, professional, you know, all that.

So you're right, setting the expectation up front [00:26:00] and showing that you have an organization that's there to follow through on those expectations and take care of that client is key.

Mike K: I tell, I would tell the exact same joke that you did. People would ask me, well, are you the one who's going to come out here and do it? And I go, I'm the last person you want coming out here to do it. These guys, they do it every single day. I'm out on the road trying to sell and manage this business.

I'm out of practice and I know everything in my head, what needs to be done. But these guys do it more accurately, more precise, and faster than I would. So. You know, trust me, you don't want me doing it. And I also back that up with, look, I'm not just going to bring any, guy off of the street to come in and paint your house because this is my reputation on the line here.

I understand the world we live in today where people can go online and write bad stuff about you in a heartbeat. And so, I make sure that they understand that, they're going to get good quality pros coming into their home.

Scott: Alright, so the question that we have received is, Do you work with [00:27:00] general contractors at all? And if so, how do you determine which ones and how do you qualify them and all that? And, in addition, do you work with designers? How do you find them? vet them? What are some of the nuances of that?

The idea here is finding people that can give you work throughout the year instead of just a one off job and see you in five years. So, either one of you. Feedback on that question?

Rick: I have a lot Well, I mean

Scott: Go for it.

Rick: the good the bad the ugly well when I started out in business with my dad You know, he had a great relationship with Interior designers, or as he called them interior decorators back then, but he only had six employees So he only had a few designers that he worked with because he just couldn't work for a lot more And they were great to work with but because they give you a little more work.

Sometimes they can be Demanded [00:28:00] right? So the expectation level Is set a little higher sometimes. I think it's also great It's a great way to market your business because like you said, you know, they're going to introduce you to multiple people. And I mean, I definitely grew, we definitely grew as a business by working with general contractors and interior designers.

There's no two ways about it. But it's painful. Like I said, in a previous episode, growth can be painful. But I think, it's a great way to grow your business if it's for you, but it's not for everybody.

Scott: Yeah, so talk about your general contractor business. Are you doing new homes ground up? Are you talking about just remodels or additions? You know what? Who do you work with and who don't you work with? Tell me a little bit about just the general contractor side.

Rick: Then the general contractor side started out with, you know, there were some very distinct neighborhoods and geographic areas that we worked in and these people are [00:29:00] constantly working on their house. They're constantly renovating. They're constantly adding on. And I was like, why are we not painting for these people when this project happens?

And I just figured if this was the area that we worked in, I wanted to be painting for the end user, which is the homeowner. No matter what their painting needs are. So if there's a general contractor, they're doing work and they need painting. I wanted to try to get that business because I wanted the client for the long term relationship, the end client.

And so that's how we started working for general contractors. So most of what we did was renovation work, not. A lot of new work, but every now and then you'd see a new house in our area. And, you know, if it was a client that we worked for before, or if it was, you know, we're working down the street, I think it makes sense for us to try to compete for that type of job because it's like, what would we say?

Market saturation. You want to saturate your market.

Scott: [00:30:00] So how did you pursue those relationships?

Rick: Just knocked on doors, called people.

Scott: You did.

Rick: Yeah. Called them and said, Hey, you know, we were painters. Love to do some work for you. Yeah. I was hungry.

Scott: Did you get price objection from these people or tell me a little bit about that because that's what, you know, I can hear in my head already. Oh, they don't pay or they suck at, you know, managing the project. How, you know, how did you overcome some of that?

Rick: Well, you know, it's hiring and hiring employees. You hope all of them are going to be good and they're going to work out and last forever and work for you for 20 some years or your whole career, but it doesn't happen. And I think working with general contractors and designers are the same.

You know, sometimes you negotiate a job because you want it or you need it to pay the bills and you start working for these people and then. 15 years later, you're still working for that general contractor because they respect you. You respect them. You're part of their team. Then you work for other designers and [00:31:00] general contractors and you realize that you are just a subcontractor helping them get a job done.

Scott: Interesting.

Rick: totally different mindsets and you've got to be willing to walk away from those. Now, The challenge is to not expose your company to the extent where they can hurt you. So I recommend small, I recommend not doing, you know, if you're going to go out on a limb and work for a new designer or a new decorator or a new general contractor.

You know, I wouldn't do it on a huge job, especially if you don't have the manpower, you know, if it's going to take 80 percent of your resources, I don't think that's a good idea if it's going to take 20 percent of your resources. Sure. Cause you got 80 percent somewhere else doing your bread and butter.

So.

Scott: Do you ever have a challenge with payment schedules with that type of client in the past? Or when you were younger or newer, has that ever been an issue for you? Or you always had loads of cash and it was irrelevant?

Rick: No. I mean, there's general contractors and interior designers. [00:32:00] Yeah, you find the ones that are going to pay you, when you send them an invoice because they value you, you're part of their team. Like I said before, the others, 30 days, 45 days, you're called in, they're ghosting you. You're like, what's going on here.

Do I really need to work for these people anymore? No. Now you weigh into consideration is the end user, a client of mine. And sometimes you have to just deal with these payment schedules and these general contractors because it's a good client of yours and they wanted you to be on the job. And sometimes those turn into good relationships with the, with this designer or builder or contractor that you didn't know and you didn't work for before.

Scott: I also think, I've seen people do this where they get too heavy into someone that has a little bit of a longer, payment schedule. A GC or commercial work. It's okay to do it, but it can't be a hundred percent. If you need, if you can't cash flow that, then you're gonna need to make sure you are careful about how much of that you're doing at any given time.

And [00:33:00] use your residential, small residential, whatever, to cash flow it. Cause you can get strung out if you're not careful.

Rick: Yeah. And it's also hard. The other thing about general contractors specifically is if. The electrician's not on the job, the plumber's not on the job, the flooring contractor's not on the job, but they need something to happen, something visible. Who do you think they're going to call?

Scott: Yeah.

Rick: You. So you gotta, you've gotta, you know, be disciplined enough to know how to say no and work on jobs when it makes sense for you and not always just to make them look good.

And make a client feel like something's going on because it's easy to call the painter. Oh, come putty some holes and call, come prime. Well, we don't have any colors for the job yet. Well, you can just come prime, just anything, just so it looks like somebody's doing something. Well, you can eat up a profit really fast doing that.

Scott: Yeah. And that's the same, that's a. Same thing we used to do, as they'd tell you it was ready, red [00:34:00] drywall is ready, and they say, okay, sounds good. I would never send a, a manpower there until I put eyes on it because, well, actually it's not ready. They actually aren't sanded out or like, it's too humid.

It won't dr. You know, there's all these excuses and if you had sent people there, they would've been, you know, standing around. So it, it frustrates the gc. You're right. They just want bodies there because they're behind schedule, customer's a little irritated, and now it's your problem, and you do have to manage that, and it can be managed.

Mike, in, in, previous episode when we, you're, the very first episode, you talk, in your story, you... You started this business working for homebuilders and then my recollection is at some point you found out that was not a good path and you eliminated all of those people. Is that the same, case today?

Mike K: Well, yeah, actually, before I started the business, I, Was working in new construction and realized this was not the pathway. Go, I had some GC, not nearly as much, as, [00:35:00] and for me, it's a struggle because as a business owner, control is a big thing for me. And when. When you're doing work on for a GC, you're on their timeline and I mean, I actually just dealt with this for the last couple of weeks.

We've been painting some cabinets for a customer of ours and she's had a general contractor working in the home doing some things sort of related to the kitchen and some things not related to the kitchen and twice showed up. She Looks at my guys and goes, the contractor was going to be here today. I can't really have you work here.

And so we've had to scramble and, you know, find the guys, another place to go out, but that's been my one big hangup is it would just mess with my way too much. And so I'm interested in hearing how Rick handles those types of it.

Scott: Yeah, Rick, how do you handle the scheduling or, you know, what is your approach in your company to avoid what you, what Mike just said as far as,

Rick: Well, we've started doing exactly what you said. You know, we've started [00:36:00] going to jobs that are construction and renovation jobs and putting our eyes on it. And luckily we have the. Staff that can go out and check these jobs and make sure ahead of time before we send labor there, because it'll eat you alive.

I mean, I don't, you know, we have a pretty good wallpaper department in our residential wallpaper, and I feel like we are really heavy in renovation and construction jobs with them. And we've sent, you know, they've said it's ready and we've sent installers to houses that. Dust is everywhere. There's no running water in the house.

You know, you can't hang wallpaper when you're doing that's when the environment is that way. So we've gotten burned enough and wasted enough time that we look at these jobs beforehand, just like you said, we're not coming until we check the drywall or we make sure there's not six trades in the same room we're going to be in because it's, you know, especially in this market.

Everybody only has a certain amount of resources. You just can't [00:37:00] afford to waste them.

Scott: and, I do a lot of commercial. Training and did a lot of work in the commercial segment and you know the rework was a joke so we would actually get to the point where we would prime drywall and put a first coat of color on it and Walk away from it before the ceiling grid was installed before the baseboard was installed before the carpets installed and we'd say call us when you're completely done with everything because You know, then you could just, you know, run some loose tape on the baseboard.

You could roll it up on the wall even a bit. You don't really, you got an easy cut and nobody's in your way. So, yeah, does it take you a little more time? Yeah, sure it does because you didn't expect that you were going to mass baseboard in a commercial setting. But you're the last person through and we used to just do it that way and it worked out because then you have less rework.

And, you know, as long as you're You know, telling the contractor how it's going to go. And they give you a chance to do it your way. It works out best.

[00:37:58] Building Relationships With Designers and Contractors
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Scott: Rick, you do a lot of [00:38:00] designer work. Is that similar to general contractors? Different? What's different about it? And how did you build that side of your business?

Rick: I feel like working for designers is better, for sure, because a lot of times you are the main person in the space doing the work. It's not a lot of plumbers. It's not electricians. It's not all that. You're going in to execute a color change, maybe hang wallpaper, paint trim, that sort of thing. And I feel like designers, I just feel like we've had better luck with them because it's a more controlled environment, a more controlled environment.

playing field, so to speak. I mean, we have to deal with electricians changing out light fixtures and stuff like that, but that's nowhere near as bad as a construction job. It just isn't.

Scott: Do you find them to be, high maintenance though? I mean, that would be sort of the stigma, right? They're very picky and they're controlling or they're, you know, demanding. Would you say that's a [00:39:00] true, those are truths or not so much?

Rick: Not in today's day and age, no. I feel like our design partners are much more, we're team oriented, we're on the same team. You know, everybody makes bad decisions. And, you know, a designer that gives you a lot of work, they pick the wrong color. It looks terrible. The client hates it. You know, we'll go in and help them out.

And I feel like that give and take goes, speaks volumes for the relationship. Cause it is about a relationship, you know, is it ever perfect? No relationships are, but I do feel like for us, in our market that our designer based work has been really beneficial for us.

Scott: Mike, you do any designer work at all? Or is that something that you think you would like to do more of?

Mike K: I definitely think we could do more of it because I think we could fill a void there. I think we've got the guys who can handle it. I've done a little bit in the past. Probably [00:40:00] because of my hardheadedness, I've not pursued it. Just like what Rick said, you know, the designers can be, tricky sometimes, but, if you have a good relationship, you know, they'll keep feeding you more and more work and they'll, that's usually a high end client right there.

So, I think we're all aiming for that kind of work. So, it's definitely something that's on my radar to, to pick up more of here in the future.

[00:40:21] Building Partnerships for Business Growth
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Scott: Yeah. Now, Rick, do you, is it part of your business to work at expanding that or do you guys have a process that you're trying to add designers or what do you do to nurture those relationships for those that don't do anything in that space?

Rick: I mean, we're always trying to grow our designer business and get involved with more designers. We've expanded our carpentry division because of that. You know, a lot of contractors don't want to add crown molding in a couple rooms. They don't want to add a bookcase in a family room. So we've started trying to fill [00:41:00] that void, which a lot of times will get us the paint job.

You know, our wallpaper team, we try to get paint jobs from their abilities, you know, and it's getting some of these multiple services to, work with each other to try to keep everybody busy and productive. And it's good for the designers because it's, you know, two less people maybe, or one less person they have to talk to and coordinate.

They're busy people too, you know, a lot. You'll find ones in your areas that are working. Sole proprietors, you'll find ones that have a full staff. And I think it's awesome to hook up with those people because they're doing something that you could be involved in and they're doing it as a business. So it's legit.

So I always want to try to partner with new people if we can.

Scott: Yeah. I think for those looking to grow their business, I think at both selective. Being selective with some GCs and working with some designers and being both be [00:42:00] really good for your business because They're it's recurring revenue You know that you might get a hundred two hundred thousand dollars a year from a single source and whereas in you know In a residential world, you're reselling that job over and over So I definitely think it's something to look at as you've heard today a couple things to watch out for.

It's not necessarily Everyone is a good client, but you know, if you have your eyes wide open, I think it's definitely something, really to add to your mix.

Rick: Yeah. I think one of the, one of the last challenges I'll mention for designers is schedule can be a challenge for them because a lot of times they can't wait but so long. Because they're doing an install, they've ordered furniture, they've ordered drapes, they're coordinating all that, so they, they want people that can, don't have a long, really long lead time to be able to help them out usually.

[00:43:00]