PowerTips Unscripted

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:

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In this episode, we take a closer look at the sales process. We are always looking for fresh ideas and concepts that apply specifically to remodelers and those in the building community.

Our guest Jan Neiges is adamant that you should be selling to design, NOT designing to sell, and she shares how you can improve your closing ratio, gain more control of the sales cycle and earn a design fee within two hours.

Jan Neiges is a National Kitchen and Bath certified Kitchen Designer and on the nine-member board for NKBA. Jan brings her 20 years of experience as a kitchen and bath designer and her 40 years of sales experience to share the selling process that she has developed.

Victoria, Mark and Jan talk more about:

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One of our core principles is that remodeling companies should make a good net profit, after paying the owners an above-average salary. When the economy’s booming, you can get away with a lot and still hit those goals, sometimes by accident. But the goal is to get those healthy net profits consistently, year after year, even in a downturn.

In this episode, Mike Medford Sr. talks to Victoria and Mark about how to do just that. Before seeing the metrics of the Top Ten Roundtables members a few years ago, Mike says his financials were always in flux. But then he took those figures and made them hard targets.

Mike Medford Sr. has been a home remodeling contractor for over 40 years. In 2007, he partnered with his son, Mike Jr. to form what is now Medford Design Build, with offices in Colleyville and Arlington, TX. Mike Sr. is the former president of Medford Design Build and is currently retired. 

Mike challenged himself and his team to hit the new fixed targets. He refined their processes and challenged his team to hit those targets. By the next quarterly meeting, the company’s profits were rising. He talks about how he and his team made it happen, including:

Mike also talks about getting back to the art of contracting and how important that is to your margins.

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As a seasoned business professional, you’ve probably been on both sides of the equation when it comes to giving and getting help. Get advice, give consultation. Gain a mentor, bestow some wisdom. While in these essential moments, we want to help and be helped, that doesn’t always happen. 

It helps to know there are differences in the types of support we can give and get — and what they are. 

In this episode, Allison Iantosca will discuss those distinctions with Victoria and Mark, and how stopping and thinking about how you ask for or give help will make the results more useful and valuable.

Allison is the president and owner of F.H. Perry Builder, a Boston-area custom remodeling firm focused on building homes and relationships of lasting value.

Though there are nuanced distinctions, coaching, consulting, and mentoring are not the same thing, says Allison. Knowing the differences will make the help given or gotten more relevant and valuable. Figuring it out includes knowing what you want to offer or receive in that moment, including:

One of the best ways to differentiate between the three main types of help you can give or get is to determine the goal, and what choices need to be made to get there.

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Guest Andy Haste is among one of Remodelers Advantages most successful members, and he attributes that success to consistency and profitability.  But, how does one achieve consistent profits in such an unpredictable, and inconsistent industry such as remodeling? 

This episode shares tips, tactics, and techniques to effectively set the goals and budgets to reach, and maintain consistent profit in such an inconsistent industry.

Andy is the president of Riverside Construction in West Lafayette, Indiana, and has been part of the Remodelers Advantage Roundtable community for many years.  He has 15 years of experience in the business supplies industry and values the privilege of working alongside homeowners, exploring creative ways to turn their homes into personal living spaces that will be loved for years to come.

Victoria, Mark and Andy talk more about:

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Working with just a few Realtors can bring additional jobs to your remodeling company. It’s not about appealing to the masses, but about developing relationships with several realtors who appreciate how you work, your quality, attention to detail, and exceptional client experience. 

In this episode, Kathi Fleck discusses working with Realtors with Victoria and Mark, and how to establish and maintain relationships that can get more jobs for your company, help them sell more homes, and take care of your shared clients.  

Kathi is co-owner of LoneStar Design Build in the Dallas-Ft. Worth, TX, area, where she leads a team and their clients through the design-build experience. Kathi has a long-term relationship with Coldwell Banker Real Estate, and other Realtors who send business her way.

Realtors go out of their way to support the seller/ buyer experience, says Kathi. Helping their clients with remodeling and providing referrals is part of their daily routine. As remodelers working with realtors, understand how Realtors work and make them look good as they support their client. It can be challenging, but Kathi says a few simple tricks can pay off with easy referrals, including:

The best way to start is by contacting real estate offices and setting up a presentation, calling an agent who works in the same neighborhoods you do, and taking advantage of networking groups.

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Business processes are absolutely crucial in today’s business landscape. It’s almost impossible to operate a business without them. Today on PowerTips Unscripted, we’re joined by Adi Klevit, Founder of Business Success Consulting, to explore the ROI of implementing systematic processes in your business.

Adi has been helping businesses create, document, and implement processes and procedures for over 30 years. Adi and her team have helped hundreds of fast-growing companies lacking consistency, scale and grow and achieve their goals.

Adi, Victoria, and Mark talk more about:

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Our Roundtables members share their financial metrics at every meeting, in what we call the composite report. But there’s one field that’s almost always reported as zero.

It’s the proactive outbound sales call metric. It’s confusing to many, not just as a field on a spreadsheet, but as an activity.

Abe Degnan says this metric is valuable to all remodeling companies, and making those calls builds his own company’s sales pipeline.

In this episode, Abe joins Victoria and Mark to explain the proactive outbound sales call, how to track it, and what it can do for your company. 

Abe is president, problem-solver and life changer at Degnan Design Build Remodel in DeForest, WI. He also manages day-to-day business operations — and as a long-time Roundtables member, Abe knows how important it is to measure what is managed.

This statistic isn’t just for replacement companies with a call center, says Abe. A proactive outbound sales call also doesn’t have to be a phone call. It occurs any time you follow up on your sales process in a way that is outside of your established sales routine or is something your client isn’t expecting you to do. Abe talks about what those follow ups can be, and how to track them, including:

Making proactive outside sales activities a part of your business can get, and while it’s a marketing activity, it has to be carried out by the sales staff to be effective.

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Every remodeling business owner wants to add more money to the bottom line. Reducing slippage is the lowest-hanging fruit to pick in your quest.

In this episode, Tim Faller talks to Victoria and Mark about reducing slippage in your remodeling company. Slippage occurs when your estimate is lower than the real costs of the job. Reducing it takes a change in mindset throughout the organization.

For 17 years, Tim has worked with hundreds of remodeling companies to improve profits by creating smooth, efficient production systems. As a Senior Consultant and Master of Production for Remodelers Advantage, Tim’s field and business ownership experience is vital to his additional role as facilitator for Owner and Production Manager Roundtables Groups. He’s also a published author, a Member of the Remodeler Hall of Fame, and the recent recipient of the Harold Hammerman “Spirit of Education” Award. Tim is co-host of The Tim Faller Show, a weekly podcast focused on “Improving The Bottom Line Through Production Training.”

The biggest challenge in reducing slippage is getting your whole team involved in the effort. Tim says slippage is too often brushed off with “It is what it is.”  That’s where the change in mindset comes in — the attitude should be “It is what we make it.” Slippage is controllable, but it takes a company-wide awareness and work to corral it through realistic and accurate estimating,  job scheduling, and building in time to de-bug a job before it starts. He talks about the ways to reduce slippage in your processes, including:

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Today on Power Tips Unscripted, Arlin Sorensen, the CEO of Oak Road Consulting joins the show. Understanding the art of creating value within your business is pivotal, especially in the context of planning your exit strategy. It’s all about setting clear goals for your personal wealth and translating that into a business value target that can drive your success. Arlin is here to share invaluable insights on how you can craft a robust value-creation strategy and harmonize it with your long-term financial goals.

Arlin Sorenson is a simple Iowa farm boy who fell in love with technology and has spent the past 40 years in the IT industry. His passion is helping business owners and leaders achieve their definitions of success.

Arlin, Victoria, and Mark talk more about:

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