Let’s Share Some Thoughts on This Over a Cup of Coffee
It’s been a week since Gene, David, Larry, and Mike shared their struggles over a cup of coffee. It’s a few minutes before 10:00 on Saturday morning, and David is already sitting at a table when Gene walks into the coffee shop. Gene goes to the counter, grabs a cup of coffee and a warm cinnamon roll, and makes his way over.
Before Gene can even take a bite, David asks what he expects from this meeting.
Gene ponders this for a minute and replies, “I hope we can figure out what to do about some of the problems I’m dealing with. But really … I have no idea what to expect. Did you invite anyone today?”
“Yes,” answers David. “I invited the roofing contractor my boss, John, uses. What about you? Did you invite anybody?”
As the bell on the door jingles, Gene replies, “Yes I did—and there he is. That’s Doug, the guy who’s been doing some of my concrete work.”
Just then, Larry walks in with someone Gene recognizes as a local builder but has never met.
After the three newcomers grab their coffee, they join Gene and David at the table.
“Looks like we might need more chairs,” Larry observes.
Gene agrees, and they grab the table and chairs next to them and drag it over. As they’re getting situated, Mike walks in with a couple more guys.
Once everyone is settled, Gene interrupts the overlapping conversations going on and asks everyone to go around the table and introduce themselves.
There are the four from last week; Craig, the roofer David invited; Doug, the concrete contractor Gene invited; Steve, the general contractor Larry invited; and Bill, the plumber, along with Carl, the HVAC guy.
After the introductions are done, Gene shares what happened last week and how the four of them started talking about the individual problems they were dealing with and wondering if those struggles were common. The reason for today’s meeting, and for inviting others, was to find out.
Gene starts off by rehashing some of the problems they discussed last week: not having the money to pay for a truck transmission repair, struggling to cover income taxes, and realizing that everyone around the table had faced similar struggles.
“I was looking for answers and ended up with more questions than answers.
So, what are the biggest problems you guys have dealt with?”
They all look at each other, and the floodgates open – losing money on jobs, employees not showing up, unhappy customers, equipment breaking down, jobs falling behind schedule, not being able to find good help, not having enough time to do everything…and on and on the list goes.
“Okay, okay,” Gene says, waving his hand. “Steve, you and Larry both have more experience than the rest of us. Do you have any specific examples of dealing with an unhappy customer?”
Steve and Larry look at each other, and Larry nods for Steve to go ahead.
“Alright,” says Steve. “A good example goes back to early in my business. I didn’t know how to price a project, so I just did ‘time and material’. I’d give an estimate, and then just bill the customer hourly for our time and add 10% to the material. I felt like it was the safest way for me to not lose money.
“The problem with this particular project was that the customer kept adding additional work.”
Steve pauses before continuing.
“When the project was finished, I gave them the final bill. The original estimate was $100,000. The final total ended up being $151,000. The customer was furious and informed me they couldn’t pay the extra $51,000. They had borrowed everything they could just to cover the original estimate.
“We argued back and forth on this for weeks. I told them I couldn’t afford to eat the $51,000—I didn’t have that kind of money. Eventually, we agreed to split the difference, and I had to borrow $15,000 just to pay the material bill.
“I don’t know where they came up with the rest of the money, but needless to say …
“The customers weren’t happy. And they didn’t have anything good to say about me.”
Steve shakes his head, “I couldn’t blame them for being upset. I assumed they understood it would cost them more—they didn’t. After that, I quit doing time and material and started doing bids. That didn’t mean I never lost money on jobs again, but it happened less often, and I never had another customer as mad as they were.”
The guys around the tables nod, each of them identifying with similar situations from what they had dealt with.
“Well, it appears that we all can relate to Steve’s story,” Gene said. “So, what are we going to do to keep something like that from happening to us?”
Everyone shrugs and glances around the table with questioning looks.
Then David speaks up. “I’ve an idea. Let me talk to my boss, John Lavell. He owns Straight Line Construction and appears to have things figured out. Maybe he could help us find some answers.”
With that, the group agrees to meet back at the coffee shop again next week to hear what David finds out from John.
———
If you can identify with the struggles these guys are dealing with, I get it. I’ve been there too.
If you’d like a place to talk through the struggles of running a construction business over a cup of coffee, we’re starting a weekly, virtual BUILDers Coffee on February 18th at 10:00 AM CT.
Pull up a chair. The coffee’s on.
You can also check out our digital Business BUILDing Toolbox, or schedule a free 30-minute meeting to talk through the real problems you’re facing in your construction business.