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America was built upon the foundation of freedom seekers.  Our forefathers were able to create this country from their bare hands, paving out the roads to begin their journeys, building the homes to house their families and constructing the buildings that became their towns.  The America we look back on was beautiful, intricate, and strong.  As generations have gone on, our culture has evolved.  Technology has advanced our world, expensive material costs outweigh the quality of materials used, and most importantly, the reduction of skilled, motivated and passionate people in the workforce required for America to continue building has dramatically impacted our world!  With the next generation of youth reluctant to get their hands dirty, and nearly 40% of the current construction workforce predicted to retire in the next decade, we have a huge labor shortage crisis on our hands. Without construction workers, how will we solve traffic problems, build up new infrastructure to support growing populations, or repair homes after catastrophic storms damage cities?  Is the future of the construction industry destined for destruction or prosperity?   

No one has a crystal ball, but if we look at statistics, construction projects around town, or talk to young students exploring their future career, the answer may be scary, BUT with some changes there is an opportunity to change the tides and build America back up again!  

1.) We need to work together to help change the perception of what a career in construction is really like 

2.) We need to work with business partners to make building costs more affordable, but do so without jeopardizing quality craftsmanship and materials, and 

3.) We need to embrace technology in a way that helps us drive efficiency and sustainability for the future!

The construction industry, for many, is viewed as a “second” place option they must go when they failed on a “traditional” pathway, or that it is a “less than optimal” line of work, somehow less noble than that of a college-educated person in an entirely different field.  The truth is, they are wrong, and we need them to know that.   The construction industry is a place the smartest and most aspirational people should gravitate to.  This industry has more, or as much, to offer than any other industry. After all, where else can you enter a workforce with a clear path to making a 6-figure salary, transition to any aspect of business, or even in the same role but to a larger company, or start your own business to perform the work you have learned?  The stories told about the construction industry oftentimes paint an incomplete picture.  Telling the truth about this industry, that this career is a pathway to the modern “American Dream.” This American dream spirit will hopefully always imply a way for Americans to achieve success, through hard work, opportunity, but while “Marriage, owning a home, and having children are lower priorities than they were in the past. Being happy and fulfilled and having the freedom to make significant life decisions top the list of important elements of the American Dream of today’s young people.1”  Attracting the new generations to this dream through construction will help bring itself back and at the same time attract the next generation into prosperity to ensure growth in the future of the construction industry. 

In order to maintain the building demands our culture has placed upon us, we are in dire need of retaining and recruiting the next generation of workers to continue rebuilding America.   We need to focus on educating, training, and attracting people to the construction world.  We need them to know how this career path can benefit them AND impact the world in which they live.   We need to talk to them about how much money they can make at every level or position.  We need them to know what it looks like to have a career path in construction – how they can transition it from laborer to manager to executive to owner.  We need to tell the truth and reverse the stigmas associated with failing construction businesses.  The only way they can see this is if we join together and share the stories and fruits of their labor.  We must talk to other people about the good work you do, bring young people out to the job sites, let them test drive the excavator, and see the world from the roofline of the skyscraper that has been erected. We need people outside of construction to do their part too! 

Next, we need to blend practices of the past, which gave the construction world a solid foundation to build upon, where pride went into everything that was touched.  Don’t you agree that buildings built 100 years ago have a different look and feel compared to what we see today?  When I pass by our courthouse downtown which was started in 1899, I am still touched by its beauty, radiating in formality, simplicity, order and tradition. 

The future of the construction industry

It was the effort and labor of construction workers that foster all of this history that still stands today.  As we look at growing cities, new structures seem to be going up as fast as possible and many look like a standard box, some being complete eye sores.   Moving forward, we need to combine tradition with modernization in order to continue to prosper into the future.   It is no secret that the cost of materials and the speed at which structures need build is a major factor affecting this, but it can be overcome. 

We need consumers, developers, environmentalists, lenders, banks, elected government officials, and of course developers to be proactive and change the expectations.  We must stop just trying to mass produce buildings and place new infrastructure with the cheapest and lowest quality materials, not to mention the design and architecture of the structures and buildings.  It would be impossible if construction companies, developers, and architects refused to change their ways, but if they are willing to be strategic and use modern materials, it is possible with a technique called “retrofit architecture.”  Blending the old with the new, ultimately sustainably supporting our American legacy.  A fantastic example of this can be seen in NYC with Alpolic Metal Compositie Materials, which were used in a new NYC wearehouse project in the Chelsea neighborhood. 

“The Warehouse project has stayed true to the heritage of the building while infusing elegance and modernity. It is a marvel and a true study of mixed material use that has created a new icon in New York’s Chelsea art district. It stands as proof that bringing older buildings into the modern era doesn’t require a total tear-down. Retrofitting can often provide a fresh new life at significant cost savings.  The goal was to maintain the historic integrity of the original structure while creating an environment inspired by innovative technology and materials, designed to support a modern way of living and working.2

As you look around different cities and towns across America, the historic buildings look vastly different than most of what is built today.  The buildings and infrastructure of the past have definitely weathered some storms, but they all seem to stand the test of time better than some of the eye sores often built today.   I know, I know, easier said than done, especially since higher quality typically comes at a significant cost, and reality proves not everyone can or will pay the premiums.  Which brings us to another potential challenge for this industry in the future, inflation.  This obviously will impact every other industry, and is not just unique to construction. 

As we discuss rising costs, controlling prices and decent interest rates, the economy plays a huge part in this, and it is hard to control.  Construction contractors are then impacted by the bidding process, which also has a direct correlation to business cash flows on projects and profit margins to keep them afloat.  With so many drivers affecting inflation within the construction world, the future will be dependent on elected officials both at the local, state, and federal levels that will help prevent inflation from rising.  There is no crystal ball or safeguard for this, so contractors should plan accordingly for the future.  

One thing to focus on for the future is to ensure you don’t place all your cards in one basket when it comes to suppliers.  Focus on building strong and trusted relationships with multiple suppliers, so you can expand your network and have options in challenging times.  The other thing to do is ensure you have strong records of your financials and cash flows.  In fact, according to SCORE, “82% of all small businesses fail due to cash flow problems. When money gets tight, paying yourself, your bills, the payroll and other financial obligations can be extremely difficult. This is why companies of all sizes keep a close eye on cash flow, or the net cash and cash equivalents currently flowing both in and out of your business. 3”   When money gets tight, paying yourself, your bills, the payroll and other financial obligations can be extremely difficult. This is why companies of all sizes keep a close eye on cash flow, or the net cash and cash equivalents currently flowing both in and out of your business. Mobilization Funding’s entire business is set up to help construction and manufacturing contractors stay cash flow positive.  There is a plethora of resources and a free online cash flow tool to keep track of all your individual projects cash flows.  In keeping strong records and understanding exactly what cash is moving in and out of your business, it will help you make informed decisions like which projects to take on, and which ones to say, “No” too. The future health of the construction industry will be dependent on these businesses staying afloat.   Additionally, with high interest rates and inflation rising it’s becoming both more challenging and more necessary to secure funding – not a great mix huh?   As a result of this contractors are taking on projects where their margins might not be as high or they don’t have the best cashflow structure, but they think winning a bid will help put more money in the bank.  This strategy is actually a recipe for disaster, as not taking into account the costs of completing those projects will leave them in the red, well into the project and trying to dig themselves out.  Strong records of financials and thoughtful selection of the projects they take on based on their cash flow situation will help make them bankable in the future.  Mobilization Funding is structured precisely so that our loan programs provide funds according to the contractor’s cash flow cycles.  Money is provided when gaps in cash flow appear and repaid back when the contractor is paid, and the cash flow is positive.  Contractors having a strong grasp and understanding the their financial structure and cash flow cycles of their projects will help sustain the industry and defy the odds of failure for the future to come! 

Finally, the construction world must be able to embrace and utilize technology to increase efficiency and find more sustainable ways of building that will also ensure protection of the environment for the next generation. One way that technology is helping to make construction more sustainable is through 3D printing and prefabrication.  “3D printing allows for components to be printed directly from digital models, eliminating the need for traditional manufacturing processes. This not only reduces the amount of energy and resources used in production but also increases accuracy, leading to fewer errors and less waste in excess materials. Technology will help play an important role in creating new materials to aid in construction materials.  Marsh says, “Expanded use of robots and machine-assisted applications can help revolutionize the construction sector.4”  Robotics don’t have to replace our skilled workforce, but they can help make them more precise and efficient.  For example…. What if all of the younger generation knew that Bulldozers, Excavators and other Heavy Equipment can all be operated with GPS and Robotics now to ensure that what they are trying to accomplish is done within a matter of inches and even millimeters.  That dirt in one very precise spot can be picked up and dropped in another very precise spot at certain and specific grade that was determined in the office.  Don’t you think those facts might be more appealing to the younger generation when they are considering a role in the construction industry?  Technology has opened countless opportunities for making construction more sustainable in the long term, by streamlining processes and utilizing fewer resources than ever before possible.  This will dramatically affect the way we continue to build when needed.

Whether you are in the construction business or not, everyone can make an impact!  It is time to do your part!  In doing so, America will have the talent and manpower it needs to embrace technology in construction, to seek out sustainable methods to help protect the environment, to value quality materials over cost or quantity, and help preserve the greatest country on Earth! It will give the next generation the opportunity to work hard to create something new, to reap rewards, and to achieve the American dream this country was founded upon.

References: 

1. (Wilson, 2023 https://www.closeup.org/for-young-americans-the-american-dream-resonates-differently/).  

2. ALPOLIC. “Can Classical and Modern Architecture Coexist?” https://www.alpolic-americas.com/blog/can-classical-and-modern-architecture-coexist/.12/6 /21. Aug 7, 2024.  

3. Sutter, Brian, SCORE, The #1 Reason Small Businesses Fail – And How to Avoid It, https://www.score.org/resource/blog-post/1-reason-small-businesses-fail-and-how-avoid-it.

4. Plan Radar. “ Technology is Paving the way for Sustainable Construction.”

https://www.planradar.com/ae-en/technology-is-moving-construction-towards-sustainablity/#:~:text=3D%20Printing%20and%20Prefabrication,less%20waste%20in%20excess%20materials. Jan 2023. August 7, 2024.  the construction industry as a whole. 

America was built upon the foundation of freedom seekers.  Our forefathers were able to create this country from their bare hands, paving out the roads to begin their journeys, building the homes to house their families and constructing the buildings that became their towns.  The America we look back on was beautiful, intricate, and strong.  As generations have gone on, our culture has evolved.  Technology has advanced our world, expensive material costs outweigh the quality of materials used, and most importantly, the reduction of skilled, motivated and passionate people in the workforce required for America to continue building has dramatically impacted our world!  With the next generation of youth reluctant to get their hands dirty, and nearly 40% of the current construction workforce predicted to retire in the next decade, we have a huge labor shortage crisis on our hands. Without construction workers, how will we solve traffic problems, build up new infrastructure to support growing populations, or repair homes after catastrophic storms damage cities?  Is the future of the construction industry destined for destruction or prosperity?   

No one has a crystal ball, but if we look at statistics, construction projects around town, or talk to young students exploring their future career, the answer may be scary, BUT with some changes there is an opportunity to change the tides and build America back up again!  

1.) We need to work together to help change the perception of what a career in construction is really like 

2.) We need to work with business partners to make building costs more affordable, but do so without jeopardizing quality craftsmanship and materials, and 

3.) We need to embrace technology in a way that helps us drive efficiency and sustainability for the future!

The construction industry, for many, is viewed as a “second” place option they must go when they failed on a “traditional” pathway, or that it is a “less than optimal” line of work, somehow less noble than that of a college-educated person in an entirely different field.  The truth is, they are wrong, and we need them to know that.   The construction industry is a place the smartest and most aspirational people should gravitate to.  This industry has more, or as much, to offer than any other industry. After all, where else can you enter a workforce with a clear path to making a 6-figure salary, transition to any aspect of business, or even in the same role but to a larger company, or start your own business to perform the work you have learned?  The stories told about the construction industry oftentimes paint an incomplete picture.  Telling the truth about this industry, that this career is a pathway to the modern “American Dream.” This American dream spirit will hopefully always imply a way for Americans to achieve success, through hard work, opportunity, but while “Marriage, owning a home, and having children are lower priorities than they were in the past. Being happy and fulfilled and having the freedom to make significant life decisions top the list of important elements of the American Dream of today’s young people.1”  Attracting the new generations to this dream through construction will help bring itself back and at the same time attract the next generation into prosperity to ensure growth in the future of the construction industry. 

In order to maintain the building demands our culture has placed upon us, we are in dire need of retaining and recruiting the next generation of workers to continue rebuilding America.   We need to focus on educating, training, and attracting people to the construction world.  We need them to know how this career path can benefit them AND impact the world in which they live.   We need to talk to them about how much money they can make at every level or position.  We need them to know what it looks like to have a career path in construction – how they can transition it from laborer to manager to executive to owner.  We need to tell the truth and reverse the stigmas associated with failing construction businesses.  The only way they can see this is if we join together and share the stories and fruits of their labor.  We must talk to other people about the good work you do, bring young people out to the job sites, let them test drive the excavator, and see the world from the roofline of the skyscraper that has been erected. We need people outside of construction to do their part too! 

Next, we need to blend practices of the past, which gave the construction world a solid foundation to build upon, where pride went into everything that was touched.  Don’t you agree that buildings built 100 years ago have a different look and feel compared to what we see today?  When I pass by our courthouse downtown which was started in 1899, I am still touched by its beauty, radiating in formality, simplicity, order and tradition. 

The future of the construction industry

It was the effort and labor of construction workers that foster all of this history that still stands today.  As we look at growing cities, new structures seem to be going up as fast as possible and many look like a standard box, some being complete eye sores.   Moving forward, we need to combine tradition with modernization in order to continue to prosper into the future.   It is no secret that the cost of materials and the speed at which structures need build is a major factor affecting this, but it can be overcome. 

We need consumers, developers, environmentalists, lenders, banks, elected government officials, and of course developers to be proactive and change the expectations.  We must stop just trying to mass produce buildings and place new infrastructure with the cheapest and lowest quality materials, not to mention the design and architecture of the structures and buildings.  It would be impossible if construction companies, developers, and architects refused to change their ways, but if they are willing to be strategic and use modern materials, it is possible with a technique called “retrofit architecture.”  Blending the old with the new, ultimately sustainably supporting our American legacy.  A fantastic example of this can be seen in NYC with Alpolic Metal Compositie Materials, which were used in a new NYC wearehouse project in the Chelsea neighborhood. 

“The Warehouse project has stayed true to the heritage of the building while infusing elegance and modernity. It is a marvel and a true study of mixed material use that has created a new icon in New York’s Chelsea art district. It stands as proof that bringing older buildings into the modern era doesn’t require a total tear-down. Retrofitting can often provide a fresh new life at significant cost savings.  The goal was to maintain the historic integrity of the original structure while creating an environment inspired by innovative technology and materials, designed to support a modern way of living and working.2

As you look around different cities and towns across America, the historic buildings look vastly different than most of what is built today.  The buildings and infrastructure of the past have definitely weathered some storms, but they all seem to stand the test of time better than some of the eye sores often built today.   I know, I know, easier said than done, especially since higher quality typically comes at a significant cost, and reality proves not everyone can or will pay the premiums.  Which brings us to another potential challenge for this industry in the future, inflation.  This obviously will impact every other industry, and is not just unique to construction. 

As we discuss rising costs, controlling prices and decent interest rates, the economy plays a huge part in this, and it is hard to control.  Construction contractors are then impacted by the bidding process, which also has a direct correlation to business cash flows on projects and profit margins to keep them afloat.  With so many drivers affecting inflation within the construction world, the future will be dependent on elected officials both at the local, state, and federal levels that will help prevent inflation from rising.  There is no crystal ball or safeguard for this, so contractors should plan accordingly for the future.  

One thing to focus on for the future is to ensure you don’t place all your cards in one basket when it comes to suppliers.  Focus on building strong and trusted relationships with multiple suppliers, so you can expand your network and have options in challenging times.  The other thing to do is ensure you have strong records of your financials and cash flows.  In fact, according to SCORE, “82% of all small businesses fail due to cash flow problems. When money gets tight, paying yourself, your bills, the payroll and other financial obligations can be extremely difficult. This is why companies of all sizes keep a close eye on cash flow, or the net cash and cash equivalents currently flowing both in and out of your business. 3”   When money gets tight, paying yourself, your bills, the payroll and other financial obligations can be extremely difficult. This is why companies of all sizes keep a close eye on cash flow, or the net cash and cash equivalents currently flowing both in and out of your business. Mobilization Funding’s entire business is set up to help construction and manufacturing contractors stay cash flow positive.  There is a plethora of resources and a free online cash flow tool to keep track of all your individual projects cash flows.  In keeping strong records and understanding exactly what cash is moving in and out of your business, it will help you make informed decisions like which projects to take on, and which ones to say, “No” too. The future health of the construction industry will be dependent on these businesses staying afloat.   Additionally, with high interest rates and inflation rising it’s becoming both more challenging and more necessary to secure funding – not a great mix huh?   As a result of this contractors are taking on projects where their margins might not be as high or they don’t have the best cashflow structure, but they think winning a bid will help put more money in the bank.  This strategy is actually a recipe for disaster, as not taking into account the costs of completing those projects will leave them in the red, well into the project and trying to dig themselves out.  Strong records of financials and thoughtful selection of the projects they take on based on their cash flow situation will help make them bankable in the future.  Mobilization Funding is structured precisely so that our loan programs provide funds according to the contractor’s cash flow cycles.  Money is provided when gaps in cash flow appear and repaid back when the contractor is paid, and the cash flow is positive.  Contractors having a strong grasp and understanding the their financial structure and cash flow cycles of their projects will help sustain the industry and defy the odds of failure for the future to come! 

Finally, the construction world must be able to embrace and utilize technology to increase efficiency and find more sustainable ways of building that will also ensure protection of the environment for the next generation. One way that technology is helping to make construction more sustainable is through 3D printing and prefabrication.  “3D printing allows for components to be printed directly from digital models, eliminating the need for traditional manufacturing processes. This not only reduces the amount of energy and resources used in production but also increases accuracy, leading to fewer errors and less waste in excess materials. Technology will help play an important role in creating new materials to aid in construction materials.  Marsh says, “Expanded use of robots and machine-assisted applications can help revolutionize the construction sector.4”  Robotics don’t have to replace our skilled workforce, but they can help make them more precise and efficient.  For example…. What if all of the younger generation knew that Bulldozers, Excavators and other Heavy Equipment can all be operated with GPS and Robotics now to ensure that what they are trying to accomplish is done within a matter of inches and even millimeters.  That dirt in one very precise spot can be picked up and dropped in another very precise spot at certain and specific grade that was determined in the office.  Don’t you think those facts might be more appealing to the younger generation when they are considering a role in the construction industry?  Technology has opened countless opportunities for making construction more sustainable in the long term, by streamlining processes and utilizing fewer resources than ever before possible.  This will dramatically affect the way we continue to build when needed.

Whether you are in the construction business or not, everyone can make an impact!  It is time to do your part!  In doing so, America will have the talent and manpower it needs to embrace technology in construction, to seek out sustainable methods to help protect the environment, to value quality materials over cost or quantity, and help preserve the greatest country on Earth! It will give the next generation the opportunity to work hard to create something new, to reap rewards, and to achieve the American dream this country was founded upon.

References: 

1. (Wilson, 2023 https://www.closeup.org/for-young-americans-the-american-dream-resonates-differently/).  

2. ALPOLIC. “Can Classical and Modern Architecture Coexist?” https://www.alpolic-americas.com/blog/can-classical-and-modern-architecture-coexist/.12/6 /21. Aug 7, 2024.  

3. Sutter, Brian, SCORE, The #1 Reason Small Businesses Fail – And How to Avoid It, https://www.score.org/resource/blog-post/1-reason-small-businesses-fail-and-how-avoid-it.

4. Plan Radar. “ Technology is Paving the way for Sustainable Construction.”

https://www.planradar.com/ae-en/technology-is-moving-construction-towards-sustainablity/#:~:text=3D%20Printing%20and%20Prefabrication,less%20waste%20in%20excess%20materials. Jan 2023. August 7, 2024.  the construction industry as a whole. 

There’s one word that has been popping up for a while now. Inflation. Inflation is the rise of materials, labor, and equipment. Not only does it raise costs, but it also heavily impacts the bidding process and cash flow on your projects. What numbers worked then don’t work now, and being adaptable to inflation is critical for your business, especially construction inflation. 

Inflation is also impacting your team and their families. As a business owner, team leader, or even if you are just leading yourself, it is a mistake to underestimate the impact this can have on your team or individual performance.  

Key Drivers of Construction Inflation

  • Material Costs: Volatility of prices for steel, lumber, concrete, and copper.
  • Labor Costs: Skilled labor shortages and state minimums driving up wages.
  • Regulatory Changes: Compliance with new regulations increasing expenses.
  • Energy Prices: Higher fuel and energy costs affect operations. 

Think about the impact these things can have on someone’s ability to do their job?  For sure, it does not make their job easier, and it is likely making it harder.  This could lead to someone feeling less confident, insecure, or unhappy.  These are traits that could potentially lead to mistakes.

construction inflation

Why Inflation Matters for Bidding

Accurate bidding is essential for profitability, and construction inflation directly impacts the bidding process:

  • Cost Estimation: fluctuating prices make accurate cost prediction challenging.
  • Contract Clauses: Price escalation clauses can mitigate risks but deter clients.
  • Competitive Edge: Effective inflation management offers a bidding advantage. 
  • Profit Margins: Accurate inflation projects are critical to maintaining margins. 

What is my recommendation on how to combat Inflation?

This isn’t to scare you away or start prepping for the worst. My advice here is to educate yourself on these factors and how they are impacting your business, your business processes, systems and you team. Collectively create the plan, for when things do hit the fan, as we all know, proactive is better than reactive. 

  • Market Analysis: Stay up to date on material and labor forecasts.
  • Supplier Relationships: Understand and secure pricing and material availability.  Make sure you have a plan for backup suppliers, and create a wider network to lean on.
  • Create a strong Contract: include price adjustment provisions to protect your margins, negotiate terms, and provide clear reasons for any adjustments you need.
  • Advanced Procurement: Buy materials early at fixed prices or negotiate on higher quantities that could give price breaks. Do what you can to avoid rapid cost spikes.
  • Efficient Team and Cash Flow Management: Complete projects on time, understand where the money is going each week. Take time to map out the possibilities and make adjustments that are efficient to the project and business.  
  • Do not be afraid to say “NO” to a project:  This is not the time to try and thread a needle to take on additional risk. Go into every project eyes wide open.

Know your strategy. Understanding what the market is doing and establishing solid relationships could not be more important as we move through high material costs, labor shortages, and as continuous changes impact the construction industry as a whole. 

Merchant cash advances, or MCAs, are loans that business owners usually look to in a crisis. Think of them as the equivalent to the business version of a paycheck advance loan with high interest and repayment terms that often do not align with what is best for the business. MCA’s are dangerous for most merchants but horrible for construction businesses, and we’ll explain why in this four-part blog series.

In our introduction to merchant cash advances, we will explain what a typical loan looks like and how the fees and costs are charged.

How MCAs Work

The basic requirements to qualify for an MCA are to submit an application that includes a business owner’s personal credit, social security number, business name, business address, and other simple information. Along with this application, they will submit four months of bank statements. Once the MCA lender gets those statements, they can evaluate the money this business receives through deposits. The MCA lenders may utilize different metrics, but they all end up with similar results. That result is that the loan or the advance amount they offer the business is close to the average amount of deposits the company has rolling through their account monthly.  

For example, a business has an average of $200,000 in deposits. The lender will build out a repayment schedule for that $200,000, typically with a repayment period between six to twelve months. Before calculating the repayment period, the MCA lender needs to determine the “Factor Rate” they will charge for the loan. This Factor Rate will be the actual cost of the loan to the business. Factor Rates can vary depending on the company, business owner’s personal credit, industry, and other variables, but is typically between 35-50% for construction contractors.

So, with a quick math example, if an MCA lender gives a business $100,000, and the factor rate is 40, the company will repay them $140,000 over the loan term. If that term is 12 months, the interest or fees charged annually is 40%, but if the term is 6 months, the actual annual rate is 80%. 

To determine the daily or weekly payment amount, the number of business days in the given period needs to be calculated (a typical month has 21 business days). If it’s a six-month term, they will take the $140,000 and divide it by the number of business days in that period.

6 months x 21 business days per month = 126 business days

$140,000 repayment / 126 business days = ~$1,111.11.  

Now, $1,111.11 is the daily number that businesses will have deducted via ACH from their bank account. 

Dangers of High-Interest Rates

These factors are a fixed fee or margin that businesses must pay back in addition to the amount they were advanced on the loan. One obvious issue is the loan is very costly in its short-term structure. Secondary to the cost, this loan is based on future receivables (the deposits they receive in their account), whether businesses receive that money or not. So, if companies don’t have enough future revenue to support the dollars they’re borrowing, it can be problematic when those loans need to be repaid—on a daily or weekly basis.

If you’re feeling stuck with payroll and vendor invoices, give us a call before resorting to a merchant cash advance. We’re here to help — (813) 712-3073

Click here to read part 2 of 4 of our Dangers of Merchant Cash Advances series.

Merchant cash advances, or MCAs, are loans that business owners usually look to in a crisis. Think of them as the equivalent to the business version of a paycheck advance loan with high interest and repayment terms that often do not align with what is best for the business. MCA’s are dangerous for most merchants but horrible for construction businesses, and we’ll explain why in this four-part blog series.

In the second part of our series, we’re going to dive into the many ways businesses get hurt by taking out merchant cash advances.

The Repayment Structure of MCA Loans

Problem #1 – Typically, MCA lenders will require a daily or weekly payment that is automatically debited from the borrower’s account. Usually, construction companies are paid 30-60 days from when they invoice for work completed. So, a daily or weekly MCA repayment structure becomes a real problem quickly. It is always worrisome if revenue streams don’t match a payment plan when taking on debt.  

Problem #2 – The price of debt to the amount of time to repay the loan AND the margin of the overall business. If a company sells its future receivables at a higher factor rate or at a higher dollar number than it makes in margin on sales, it will have an even bigger problem. 

For example, an MCA lender approves a construction business for a $100,000 MCA loan, and the terms of the loan require the business to pay back a total of $140,000 (a 40% factor rate) in a twelve-month period. Let’s assume that the construction business works off a typical 20% gross margin. Now when the business generates $100,000 in revenue (the amount they just borrowed), and they only make a 20% margin, they will actually need $200,000 in revenue to generate enough margin of $40,000 to pay back a $100,000 loan. This example also assumes they remain disciplined enough to use the $100,000 they received from the MCA loan for revenue-generating activities and not to repay an old debt or put out a fire! IF the construction business used the $100,000 they received from the MCA loan for those types of things and they need to generate $140,000 of margin to repay the whole loan, then they would need $700,000 of revenue to produce $140,000 of margin ($140,000 / 20% margin).

See how quickly this can go bad?  

The Effect of MCA Loans

The loan itself is fast and easy. (SIDE NOTE: In life, how many things that are fast and easy are actually good for you? 😊) 

We discussed some of the problems, but practically what happens next is the worst part. The main reason for getting the loan in the first place (the “fire” or “issue” that needed to be solved) has now come and gone, but this loan and the daily or weekly repayment are here to stay. Slowly every week, the free cash flow of the business is sucked away, and as soon as one month but no more than 2-3 in the construction business, the same “fire” or “issue” arises again, but this time it is at least 2-3x worse. This time it is coupled with suppliers and vendors that have not been paid, or are so late to be paid, that they are causing stress to the business. The reasonable solutions for the company are limited, and the fact that there is an MCA payment every week is an issue for any other lenders. So, the MCA Lender comes to the rescue with another MCA loan solving the immediate pain, but in reality, it only pushes the problem down the road another 1-2 months. 

How Customers Get Burned

First, it is vital to know the business owner is rarely talking to the direct lender. The network of folks selling MCA loans are brokers who are paid a commission. There is nothing wrong with a broker trying to find the right lender for a business owner and earning a commission for doing so as long as they represent all the options to the business owner and are upfront about who they are and what they are going to do.  

Too often, brokers pretend to be the direct lender; instead, they shop your application around to the actual lenders to get the best possible rate for an MCA loan. Each of these lenders may pull the credit of the business and the business owner, which results in the credit being pulled dozens of times, and those credit pulls will cost the borrower 50 to 100 or more points off their personal credit score. 

Don’t let your personal credit and business get flushed down the drain in exchange for a quick “fix.” Let our team light the way out of your financial pit by helping you find the right solution, whether through our program or just some good advice — (813) 712-3073

Click here to read part 3 of 4 of our Dangers of Merchant Cash Advances series.

Merchant cash advances, or MCAs, are loans that business owners usually look to in a crisis. Think of them as the equivalent to the business version of a paycheck advance loan with high interest and repayment terms that often do not align with what is best for the business. MCA’s are dangerous for most merchants but horrible for construction businesses, and we’ll explain why in this four-part blog series.

In the third part of our series, we will illustrate the who’s behind the what. Be on the lookout for loan sharks dressed in brokers’ clothes. As we touched on briefly in Part 2, we will learn more about the broker world and their role in MCA loans.

Who Are Merchant Cash Advance Lenders?

A quick online search will show hundreds, if not thousands, of different websites advertising MCA loans. There are only about a dozen, or fewer, actual lenders. Merchant Cash Advance lenders selling these loans are typically brokers or independent agents with affiliations or relationships with these merchant cash advance lenders. Not all brokers are bad. We work with many brokers or referral sources that may work with clients to find the right solution. 

However, a lot of brokers are just selling merchant cash advance loans. These brokers are people that businesses need to be cautious of because a merchant cash advance loan isn’t for everyone. Like our company, Mobilization Funding is not for everyone. We educate ourselves on different lending programs and options like merchant cash advance loans, factoring companies, and purchase order financing because we want to ensure we send people to the right source. We want what’s best for borrowers, even if we’re not a fit for them. 

About Broker Networks

The broker network is directly responsible for the ultimate cost of the loan or, at a minimum, can significantly influence it. For example, the actual MCA lender will give the broker the actual cost of the loan and then provide them the ability to increase it within a range to increase their commission. The broker then has the option, or the ability, to markup that loan cost to the borrower. That markup can range from 2% to as much as 10% or more. This additional markup is how brokers make money on the loan transaction. The MCA lenders have set it up so the broker can make a lot of commission, and that commission drives behavior.

Some brokers might present themselves as the actual lender with their logo on application forms or how they introduce their product. Still, most MCA brokers are not the actual lender. In these cases, borrowers are just talking to a loan sales representative looking for a commission—not the source of the capital.

The Cost of the Markup

If a typical $100,000 loan has a 20% factor rate from the actual lender, and the broker marks up that loan an additional 10-15%, the loan cost is now 30-35%. That means the broker will make 10 or 15% of that $100,000 merchant cash advance. 

This type of loan is not ideal for construction because the MCA lenders don’t understand the nature of the construction business. If they did, they would not make MCA loans to construction companies. Worse, if they do understand the construction business and don’t care, then that means they don’t care at all about the business or even try to do what is best for them. They are simply trying to do what is best for them at the expense of the construction business.  

These brokers don’t lend based on the profit of a business but the total revenue. Construction companies must pay overhead like material suppliers, equipment vendors, and employees from that revenue.

There are less expensive and less painful options for getting ahead of your financial hump. Give us a call to map out your road to recovery — (813) 712-3073

Click here to read part 4 of 4 of our Dangers of Merchant Cash Advances series.

Merchant cash advances, or MCAs, are loans that business owners usually look to in a crisis. Think of them as the equivalent to the business version of a paycheck advance loan with high interest and repayment terms that often do not align with what is best for the business. MCA’s are dangerous for most merchants but horrible for construction businesses, and we’ll explain why in this four-part blog series.

In the final part of our series, we tell the sad but true tale of a contractor who saw first-hand a merchant cash advance gone wrong. We recount this story (one of many) just to illustrate what happens when you only take the easy and fast way out!

Easy Money

A contractor in Texas—65 to 70 years old and shortly away from his retirement—had 40-plus years in business, been in the same town, worked with the same general contractors and project manager, and developed a great company. His business grew from $3 million to $10 million, and he went from several dozen employees to over 100. 

This contractor did projects that were a few $100,000, up to a couple of million dollars. Then, one week, one of those projects had a little bit of a delay, nothing problematic, nothing different than folks see in a typical construction world. And it was going to be tight for payroll. So, what did he do? This business owner got a merchant cash advance.

He was offered a couple of hundred thousand dollars within a day was deposited into his account shortly after that. He had multiple hundreds of thousands of dollars going through his account, and he’d been in business for years and had a great relationship with his bank. It was easy to lend him money. He said, “Oh, my payroll is only $60,000 or $70,000 per period, but it is always good to have a little extra money.”

MCAs: Too Good to Be True

So, the contractor took the loan, and he started to repay that every day. The first and second months weren’t an issue, but suddenly, the amount of cash flow debited from his account over those two months strained his cash because contractors only get paid once a month. 

Typically, contractors are paid that month for what they did and the costs they incurred 45 or 60 days ago. These payments are not in line with their current payroll or overhead. So, contractors are left floating payroll and expenses to material suppliers for six to eight weeks. These contractors must also have money left over to repay their MCA loan.

If businesses earn money out of sequence with an MCA’s repayment structure, they will have cash flow problems. This kink in cash flow will cause the business owner more stress than just missing payroll one week or having a challenging conversation with a material supplier, vendor, or employee. 

This solution may sound like the worst-case scenario, but it’s not as bad as what happens two and a half months after getting an MCA loan.

Robbing Peter to Pay Paul, Except Peter Is Broke, Too

The contractor had the same payroll problems but now had two months’ worth of accounts payable issues too. He didn’t pay materials suppliers, and the vendors shut him off on the jobs. The suppliers were not going to be without payment, and they weren’t going to deliver. 

Because the suppliers and vendors ultimately put liens on the project, the contractor had general contractors and their project managers calling him, wondering about the suppliers’ payments. The project managers also held back paying any money they owed the contractor for previous months’ invoices because of the liens placed on the project.

To add insult to injury, the merchant cash advances lenders are calling this contractor too, but this time, they’re not calling him and offering more money. They’re calling him because their daily debits are starting to bounce, and they’re getting frustrated and making threats. In addition, they are also calling the Project Managers and telling them to freeze payment because they are entitled to the money owed to the contractor. 

Now, this contractor is in a world of hurt, and instead of just missing payroll, his whole business is now at risk. This financial crisis could have been mitigated if he had been educated on the dangers of MCA loans. 

The Fast and Easy Path Is Usually the Wrong Way

The MCA lenders led the contractor down a path without giving them all the information—but it is up to businesses to stay informed.

Merchant Cash Advance loans are not smart solutions for construction companies. If a business is working with people who have the borrower’s best interests at heart, they will ask tough questions.

Then after careful deliberation, they will use this information to help assess the business so they can appropriately give it something beneficial to the company’s future. If receiving $100,000 feels too easy, be cautious. There are always strings attached. These strings just happen to appear a few days, weeks, or even months later.

At Mobilization Funding, we’re here to help you make better construction business decisions. Let’s chat about your options — (813) 712-3073

There’s a safety problem in American construction. It’s mental health.

A recent study concluded that 83% of construction workers have experienced a mental health issue. The construction industry has the 2nd highest suicide rate of any industry in America.

It’s time to DO YOUR PART to spread awareness and improve mental health in construction. Join our expert guests Randy Thompson and Michelle Walker as they share industry mental health insights and tips on how to build a safe environment and a caring culture in your business.

WHAT YOU WILL LEARN:

  • The factors that contribute mental health concerns in the construction industry
  • The warning signs to look for when someone may be experiencing a mental health event
  • How to build a culture of mental health safety and support
  • What resources are available and where to find them

Michelle Walker 00:04

And, and so, you know, it’s definitely it’s an issue in the industry. And you know, we’re such a safety focused industry. And yet, you know, when we kind of looked at the numbers and realize that probably about five times more construction workers were dying by suicide than were dying by physical on the job, causes that we all spend so much time, effort, energy money, investing in, it just really, you know, kind of shook me to my core and said, you know, this is it, this is a workforce that we say we care so much about, and that we’re so dependent on, we need to take better care of them from this aspect of mental health as well. And so that’s kind of how I got involved. And, and the rest is history. But, you know, the, the, the needle is moving in the industry, and so just thankful for more opportunities like this to continue to, you know, continue the conversation.

Scott Peper 00:58

Don’t miss Michelle, there’s stats and are really alarming. And I know there’s a focus in construction. But can you talk a little bit more in depth on why is it construction? More? Is it you talked about, you know, construction? is a male, heavily male industry? Is it just that or is there something about the industry itself that is really driving?

Michelle Walker

Yeah, there’s a lot about the industry. So kind of one of the soap boxes that I can get on is, when you talk to anybody in the industry, and you ask them, what’s your biggest challenge, they say, workforce, you know, trying to get get enough people to do the work. And so trying to take a step back from that and go, Well, why is there such a workforce problem, and part of it is the image of the industry. And when you kind of start lining up some of those image issues with some of these risk factors, it really shows how, you know, the industry really does have some work to do, to make it a safer place to be. So part of it is really just the people here doing the work. So men definitely higher risk, much higher risk for suicide than women. And obviously, construction has a very high male population. And then it’s the just the type of people that they are. So it’s the same thing that make the industry great. And make me love and admire every single person that’s on my crew that doing work every day. They’re tough. Perseverance, grit, determination, stick to it, all of that, all of those great traits that help get the job done. And you know, just make them admirable people can also be huge risk factors when, when you enter in a personal crisis, and addiction issue of mental health concern, all of those things, they’re not going to, they don’t want to ask for help, they’re gonna figure it out themselves, they don’t want to appear weak, they don’t want to let anybody down, they’re gonna just figure it out at all costs. And so that just really creates this kind of perfect storm for somebody to not seek help not be open to having a conversation about it. And then can lead to, you know, issues like self medicating and different substance abuse issues. So it can really kind of spiral out of control. And it has a lot to do with just that that population, again, all amazing, great characteristics until until they need to get help.

And then you just look at some of the other elements like the chronic pain associated from, you know, years of hard work or potential, you know, workplace injuries that weren’t properly treated, just schedules. So you know, very erratic scheduling, long hours, you know, that kind of those, those things don’t, aren’t really helpful for somebody who’s living with a mental illness and don’t really provide stability that they might need to be getting the treatment and help that they need to be seeking, time away from home. So remote work, so you know, away from support structures, possibly in environments that aren’t positive, you know, for healthy behaviors, you know, kind of some cyclical elements of the industry, you know, right now, obviously, everybody’s has more work to do than they, and they can, but there are periods of layoffs, which creates some financial instability, alcohol and substance abuse. So it’s kind of part of the culture pretty accepting of, you know, drinking being kind of part of a normal after work activity. And like we talked about before, if they’re not seeking help for things and you’re self medicating to get through them, the pressure of the industry, you know, there’s not a lot of room for screwing up. And if you do, it can be really catastrophic. And when you couple that with, you know, possible management gaps, so leadership gaps in knowing how to positively handle performance issues, corrections that can kind of exacerbate the feelings of letting people down if it’s not properly handled. So, again, you know, really a broad, a broad array, but they’re all

05:00

All things that we absolutely can manage better and do better and improve the industry in many ways, you know, kind of by addressing these things from the focus of mental health.

Scott Peper 05:12

This question, Randy, I go directly to you. Do you? Is there things that you feel I’m the there’s obviously Michelle done a great job of pointing out the gaps? And some of the macro issues, I would say, are there things that the industry employers are doing that actually make it worse? Or? Or is it they’re just not as are the things that they just need to do a better job of because of those macro factors? I guess my question really is, are you making it worse in any way?

Randy Thompson 05:41

Sure. It’s a great question. If we could just go back to slide five. Michelle, and I’ll answer your question, Scott. But I just wanted to highlight the fact that, you know, suicide is not simply a construction issue, there’s always a risk in identifying high risk groups, and focusing solely on why suicide behavior is so high.

06:04

Suicide is really a societal issue. It’s not just in construction, when we look at the data, year, over a year, there’s approximately 50,000 deaths annually suicide in the US. And I always compare that to, you know, if you think about a ball field, like like Fenway Park,

06:22

or where, you know, you have 50,000 seats, just think of the capacity of that park being full. And every year, that number of people die by suicide, not just in the construction industry, it’s over 14 over 14 people, for every 100,000, and about 132 suicides per day. So very impactful when we think about not just the actual suicides, but the attempts, the average is over 25 attempts, you know, per suicide, so it’s not the first time that that individual is actually attempted. So when you think about those numbers, and the deaths annually, it kind of gives you an idea of the impact that suicide has, is in the US.

07:09

And for every suicide, the data shows us that there’s approximately 100 or 110 people that are affected by that suicide, I’ll be the person’s family, the workforce, etc. So you can understand the ripple effect that suicide has on a community, let alone, you know, specifically in the construction industry. So I just wanted to highlight some of that, that data, it’s not specific to construction, there are higher risk groups, but suicide affects everyone. And even though organizations may not have had a suicide, it doesn’t mean that suicide is not an issue for them. Yeah, that’s a great point. And expanding,

07:49

expanding the topic out even farther from from, from suicide.

Autumn Sullivan 07:54

I think there’s something like 45 or 50 million Americans diagnosed with some form of a mental illness right now. So, you know, there’s definitely someone in your organization who is dealing with this on some level or another.

08:11

And I think it helps to know those numbers, right, because it can feel like it’s a lonely, that you’re alone in it, but it’s it’s incredibly common in our in our Well, you got you’re in Canada, but

08:24

I don’t know your numbers, but I know in America, it’s it’s it’s it’s prevalent. It’s very, very common. My Go ahead.

Randy Thompson

It is on you’re absolutely right. It is no different in Canada than it is in the US when we look at the numbers. For years, we’ve been reporting that one in four people will have a mental health crisis throughout their lifetime. And that number hasn’t changed in a long time. And it’s and that is a global statistic. So again, you may not have had a significant event with in your workplace. But I assure you that there are issues that people are dealing with that needs to be addressed, that are below, you know, below the surface that you may not even hear about. So having a focus on mental health is critically important, particularly for high risk groups. But even if you don’t fall within that category, doesn’t mean you’re not dealing with mental health issues, or that your staff aren’t dealing with mental health issues. So Scott, to attend to your question, I don’t think employers are making things worse. I think you’re there’s a risk of not doing anything. So to not recognize mental health as an issue is a problem. And not to not recognize suicide as an issue and construction is an even bigger problem. So there are some great things that employers are doing to address mental health but the number one the foundation of it for me is recognize that it’s an issue so that your your your employees and your staff feel safe to be able to talk about mental health, that it isn’t just that it’s recognized by the organization and that you’re actually providing supports for your for your employees.

09:58

be confidential.

10:00

or not to help them deal with some of these issues and mental health issues that they couldn’t be dealing with because there are a lot of them. You know, anything from financial distress, depression doesn’t have to be, you know, a clinical diagnosis for someone to need help. Right. So, employee assistance programs are often helpful. But you know, that’s just kind of the tip of the iceberg. What I talked organizations about is looking at what’s driving your cost when it comes to absenteeism, when it comes to drug cost, right, you have all that data available to you through your, through your insurance company, through your benefits provider, look at the data, what’s driving your costs, and then start building wellness or mental health programs around that in a very thoughtful way to simply check a box to have any PII is not good enough. And also, Michelle will tell you, when we talk about the construction industry, there is so much focus on physical health and training, organizations need to see mental health just as important. And if you actually take the same steps you take to address your physical health issues or physical health for your employees, and the trainings that you provide certain thinking that in terms of mental health, there are a lot of organizations out there that are able to help, you don’t have to be an expert in it. There is expertise out there. So don’t be afraid to reach out, you have you know, health and safety committees, you have HR support resources I can reach out to to find that help. So don’t be afraid to ask, but the first step is to actually admit that it is an issue and recognize it, and then looking at your data, what’s driving it and come up with some objectives in terms of so what do we want to do? What do we want to achieve? How can we best support our employees to keep them safe and productive at work?

Michelle Walker 11:55

Well, and when we talk about safety, I mean, we, you know, behaving, you know, behavior based safety programs. If somebody’s dealing with either a mental illness, or just a personal crisis, you know, they had, you know, a fight with their spouse last night, and they don’t know, the next time they’re going to see their kids or they’re dealing with a financial issue, their mind is not going to be on the task at hand. And so that’s, you know, you talk about safety incidents, that’s when they happen is when you know, the focus isn’t there. And, you know, I was talking to somebody the other day on the podcast about this, and like he said, if you have a equipment operator that’s going to be out there, you know, moving, you know, equipment, overhead loads over people, if they walk up and tell somebody that they’re physically sick, or that they, you know, had a rough night, the night before, or something like that, due to some like kind of physical thing, they’re not going to put them on that, you know excavator and put them in that high risk. So we need to create the environment where people feel safe to say, I’m not in a mentally safe space today to do this, to, you know, keep people physically safe as well. So it’s also interrelated and connected, and you almost you really can’t talk about safety anymore in a true, comprehensive, caring way, without including the element of mental health along with it.

13:20

And it’s a delicate balance to think I think,

Scott Peper 13:23

you have to be able to provide the tools, but you also can’t force people into them to come, you know, and so you can create all the tools you can create the atmosphere. My personal belief is that if you create the atmosphere, as a leader, or as an employer, you also have to step into and lead the way into the meaning to I think you, you know, it starts at the top. And I think you just abdicate the authority to start to have the meaning. But the very top of the leadership doesn’t step in and be vulnerable to share a story. How can anyone else feel comfortable to do that? Because the truth is, not everyone may have had suicidal thoughts, but everyone’s had a bad day. And everyone’s had a really uncomfortable moment where maybe you didn’t think about committing suicide, but half of those thoughts that you just had, would have triggered someone else to. And so it’s the awareness of that, I think is personally more important than even just the awareness of mental health. I think people need to realize there’s parameters. Everybody’s has the same thoughts. It’s just everybody reacts a little differently to them. I don’t think there’s a lot of people walking around and adulthood that haven’t had some bad issues that made them feel pretty shitty, you know, and just what you go about doing about it is the key. So do you guys focus on that for leadership?

Randy Thompson 14:50

Yes, gotta you’re absolutely right. I haven’t met an organization that’s really being effective in managing mental health without executive leadership championing

15:00

In that cause, and often that’s where it starts. And that’s where it should start to be the leader to be vulnerable and show that vulnerability to make it okay to talk about the power that leadership has in in, in supporting these initiatives is super critical. And often, that’s where I tell, you know, talk to organizations and consult with them on where you need to start, you need to show it, you know, that started at head office, we have large organizations that are decentralized, they often struggle with, well, how do we do this? Right? How do we ensure that everyone is is is, is getting the same types of supports

15:43

across the board, and I often, you know, talk about starting small and start just started head office, right, show the way tested out, and then be able to communicate all the time and cascade, you know, that out to people in the regions so that that support is available, and they know that Geez, you know, if actually asked for help, it’s not going to cost me my job. And actually, it’s actually feels good that someone within the organization, particularly leadership cares about me and my family.

Scott Peper 16:15

Yeah, I think that’s key, because it’s everyone. The other thing is, you can’t make someone talk they’re gonna find out on there, they’re gonna come on their own timeline.

16:25

But knowing the atmosphere, if you remove the barriers to the atmosphere of finally speaking, or finally stepping out of uncomfortableness, you’re more likely to have someone raise their hand and say, Hey, I need help. Or if everyone else knows that, at any given time, your the whole company is going to err on the side of hey, are you okay? Like, they’re all going to err on the Hey, it’s okay to be asked. Okay. And it’s okay to look back and say no, you know, like, if that was just the two things that I think everyone did, like, create the atmosphere leader steps into it. And by the way, this, this whole company is going to have a philosophy of, are you okay? And then the answer can be No, I’m not. Like if that if that was it, you probably find a lot more people more comfortable to speak about it, because

Michelle Walker 17:12

I think the lack of community and family and that being alone is what is a big trigger for this. And if you can do contrary to that, which is create and fill a group of people that can go find that people are going to go find their group, you know, and if you don’t create one to walk into, they’re going to go find the one that’s going to actually pour gas on the problem.

Scott Peper 17:36

Absolutely. That leads me to my next question, which I had, which is related to like social media and the factors of social media out there, kind of leading what I was just talking about, I, I feel as though everyone can go find their group now, you know, and good and bad. And so if you’re having bad thoughts, and you start to live in a social media driven world, you’re gonna find a group that might help you, but you’re more likely going to find a group that won’t, is that that’s my personal feeling. What is that? Do you guys find that as well in the social media world, and how that plays into this?

Randy Thompson 18:17

Michelle, do you want to go.

Michelle Walker 18:21

I mean, I just want to spin off quickly on what you were just talking about before, because I think it’s those it’s those creating those safe spaces for people and hoping that then that’s what they’re going to versus the unsafe spaces, like on social media.

18:34

So, you know, my personal kind of mission statement, how I set up my work in this is compelling contractors to create caring cultures. So creating those cultures where people do feel safe to ask either for help for themselves or for others. And so, you know, as Randy and I were talking, I’m prepping for this session with him, you know, it might not be that everybody on the team is willing to have that conversation with somebody, but if they know, to watch out for things, and then who to talk to so here in our company, people will come talk to me and say, Hey, I’m really worried about so and so this is what’s going on with them.

19:08

And so then I can kind of approach them and watch out for them. But creating those cultures where people are watching out for each other is is such a big important component of it because the person themselves right might not be willing to speak up or, or ask for help, but if they know that other people are watching out for them, that that creates that safe space, that’s so important.

19:29

And then yeah, as far as the social media, I mean, I guess the pluses of it are, you know, it’s a way to share positive information if they you know, if you can get it to people and, and resources and help and, and things like that. So to help them know, they’re not alone. There’s nothing, you know, wrong with them for needing help for accessing care, kind of pointing them to directions. But so I guess as an employer, how you encourage that is sharing out those resources and hopefully, people are going to be kind of following and engaging with those so that they can

20:00

Another avenue for help, if and when needed.

Randy Thompson 20:04

So, oh three Oh, sorry, Randy, go ahead, I was just gonna say, I totally agree, Michelle, and then there’s always a risk with social media, cuz you’re gonna find the good and the bad. My own personal experience going through a critical illness as I’ve used social media for the good and kind of purge the bad because it because it can be there. I think for organizations,

20:30

that makes it even more critical to provide safe spaces for your free employees, whether that be you know, a training program, whether you know, whether that be

20:42

mental health support, whatever that is, but ensuring that the employees know how to access those resources, where to access, you know, when to access them, that makes it super important, because you can have the greatest resources available to stop it, if they don’t, if they can access it, or they struggle with it. Because often it is confidential, then there’s, they’re less apt to use those resources that you’ve, you know, that you invested in, and that you have confidence in and start finding other ways to Scott’s point, you know, to get the support that they need. And sometimes it’s not, it’s not, it’s not what they need. So it’s not just having programs, you know, mental health support available, it’s ensuring that your people are aware on how to access it and what it can do for them. The other thing we talked about, just quickly in suicide prevention and living works, is building not just suicide prevention support within the organization, but the key the critical piece in building it in their communities, right, because that construction worker leaves work everyday goes home to an environment has a family has stresses, anxieties, right. And often people when they when they do kill themselves, it isn’t it is at home. So we talked about building communities of safety, not just having suicide awareness and support within the organization, but at home with their families, or where the where they may go pray, right and having it where that individual may also participate or engage in sports or activities, that kind of thing. There’s a lot, there’s less opportunity for them to go elsewhere to try and find support when it’s just surrounding them. So we kind of look at a talk about a public health approach to suicide prevention, that’s really what we encourage is not just focusing them, you know, that individual at work, but ensuring that there’s support, and that there’s awareness, wherever they work, live, play, eat, you know, within their communities. Sorry, autumn, I can

Autumn Sullivan

No, no, no, no worries. That was a, that was an important point. And it leads into my question, actually, because all three of you have talked about creating safe spaces and communities of caring and communities of safety. And I’m thinking of all the construction business owners I’ve known throughout my life. And it sounds like a very tall order for some of them. Like, I can just see some of them saying I’m not equipped to do this. Like, I also am the big tough guy and stoic and I also don’t so. So what what can what can a construction business owner do just to start creating that that work culture?

Randy Thompson 23:29

Yeah, great, great question. And I’ll refer back to a comment I made around just recognizing that it is an issue, that mental health is an issue within the organization.

23:42

And, and that kind of starts everything.

23:46

Ensuring that there’s support, you know, we talk about upstream, midstream and downstream, right, and that’s really what, what we encourage is ensuring that there’s support, wherever that individual is right, it could be at the beginning of an issue, where you know, we’re able to kind of catch it early and provide that upstream support. Or maybe they’re down, you know, they’re at that suicidal ideation level. And, you know, we need to provide some downstream support as well. So ensuring that you have each level covered, I think is important.

24:16

And reach out there’s, there’s a lot of organizations and Michelle will talk about CISSP and the work we do on the board, but in living works as well as an organization that can support to come and talk to us, right be open to getting help, like we tell people you know, be open to getting help. We have to say that to organizations and leaders as bo we open to the help as well. We know you’re not experts in this field, but there are experts out there who can help consult with you and help build a plan. A mental health plan whether it be that or suicide prevention plan that’s tied to it to ensure that you’re you’re supporting your your your employees and their families at each at each level. Whether it’s upstream, midstream, or down and Michelle, you talk much better to this

Michelle Walker 25:00

Slide can I do so? Please? Well, I think the first thing is just recognizing you don’t have to be the expert, you don’t have to know about this. And, and you don’t have to be the person who ultimately helps the person through their issues, you have to have the resources available and know how to connect people to that, but it’s really being that connector to care, not necessarily becoming the caregiver. And I think that’s a really important distinction, because there’s a lot of concern among employers, well, I don’t want to get that kind of entrenched in people’s personal things. And plus, I’m just not equipped to help them through all these issues. And so it’s really recognizing you don’t have to be the one that’s actually doing the, the fixing, you have to know how to, you have to have the resources available and be willing to connect them to those resources, is the important part along with being you know, caring and following up and all those things, but but you don’t have to be the actual, you know, doer of the plan.

26:02

And then it’s, it’s starting that conversation. So again, we you know, we’ve talked about that bold leadership support that vocal leadership support for things, and then, you know, making this be something that people start getting a little bit comfortable talking about. So I’m not going to say, become totally comfortable, because it’s, it’s not a totally comfortable topic for for many people to talk about. And especially not in construction company, in the workplace, with your co workers, things like that. So start the conversation. So include it in, you know, company meetings, if you have a newsletter that covers wellness things, you know, including information on mental wellness as part of that, having, you know, in your resources, making sure that information on, you know, suicide prevention, lifeline, crisis support, you know, those types of things are included in the conversation, hanging up posters, so we’ll hopefully at the end, go out to the CISSP website, and you can show you kind of some of the things that are there, but we have posters that you can hang up on your job site, poster boards, you know, just right along with your, you know, OSHA postings and all that

27:06

toolbox talks so that you can talk about it in, you know, as a safety topic. So the one thing that constructions got going for it, and why I think we’ve made the strides that we have in the short period of time versus some other industries that have tried to kind of adopt this at an industry wide level is that we are so safety focused, and this really fits right in with that safety culture, if you if you will be willing to build it in. And so, you know, having it be a part of your toolbox talks, you know, our tha, you know, our morning tests, hazard analysis. JJ, we added on that, you know, Are you mentally ready to work today? So, you’re breathing in that conversation of, it’s more than just, you know, are you physically able? Or do you have a sore back and you shouldn’t be lifting today? things? But are you physically Are you mentally ready and able to be able to work and perform today? And so, you know, it’s just, it’s, it’s starting that and just getting people comfortable with it. And I can tell you, it’s not, it’s not easy when you start because the first you know, safety meeting that you’re at, and you say, we’re going to talk about suicide, and you get, you know, a roomful of blank stares kind of staring at you, like you have two heads, and why on earth are you talking to me about this, but over the years, it starts getting easier, and people don’t look at you, like you’re crazy anymore. And they start being willing to talk and share and things like that, and then just building it up to other business practices that are normal. So, you know, a great opportunity is during group health enrollment time, so you know, open are, you know, here, our company open enrollment was in May, our plan renews June 1. And so typically the open enrollment meeting, you go over benefits and you talk about, you know, go to the urgent care instead of the ER because your copay is going to be lower. And if you go to this doctor, it’s this not talk about behavioral health benefits, talk about, you know, if you need to seek behavioral health, this is the directory, this is how to access it, it’s the same copay, as you know, your primary care physician, you know, whatever it is, talk about it as part of the benefits as part of the that that overall wellness thing, that your mental wellness is a part of your overall wellness and, and tried to stop separating that physical and mental wellness component, but really just build it into we care about all of you. And that includes, you know, from head to toe, not just kind of neck down.

Scott Peper 29:27

Do you guys share I would call it success stories, but stories of people who have been in a great environment one that we’re all trying to would like to create that can say, oh, because of this, this, these are things that happen. But because of this environment, I was able to recognize that I felt comfortable raise my hand and I avoided suicide because of XY and Z. Is there a Is there a place to share those stories and are they being shared now?

Michelle Walker 29:58

Well, we would love to have those stories.

30:00

As they aren’t readily shared, just because it is still a pretty sensitive personal topic that people are just kind of getting to the place where they’re willing to share. I personally have some, and I would love to share one here and I, you know, but a young man work for us, kind of off and on for a couple of years. And one day, his manager called me

30:25

again, after me talking about this for several years and, and doing training on warning signs and things. I was actually at home for the day, but he called me and said, Something’s wrong with him. Like he’s, he’s, he’s not, he’s identified, like, he’s just not acting, right. He’s not. He’s not well, he’s, and so I called him into my office, and I asked him, Are you okay? And he just broke down and started crying. And he says, I don’t think that he’s safe. I don’t think he’s safe to go out to work today. I don’t know what to do. I said, keep them there. And I’m on my way. And I came in, and I met with a young man and talk to him. And I had to ask him, and it was the first time that I had to, you know, put the living works training into practice. And I had to say, you know, are you thinking about killing yourself? And he said, I’m not right now. But I have. And I said, Okay, thank you. Thank you for being open. Thank you for sharing that with me. And can I please help get Can I please help you get help? And he said, Yes. And so, you know, we I contact, you know, he was young and single, but he allowed me to call his mom and we talked to his mom together and assured like she, she was meeting up with him so that he wouldn’t be alone. And he would go stay with her. And then, you know, got him connected to help through our behavioral health benefits. And he, he ended up leaving the company a few months later to go on to another opportunity that he was ultimately working for, but he’ll still call every, you know, four or five months or so. And just say, I know, I was there at that moment for a reason, because you, sorry,

31:54

you these, these things are real. And so that’s just one story. That just happened in our little company here. And so I have to believe that, you know, dozens of those stories are happening every day. And if we can get people to share them, I think hopefully, that’s what’s going to compel a lot of people to start taking this action in their organizations. Yeah, you know, hearing that story. And this is why I love the stories to be told because it they relate everybody can relate to a story more than a newspaper or slide presentation.

Scott Peper 32:28

And I think what you what I’ve heard from, specifically from you, Michelle, and the organization that you’re operating in, is you have a culture that has been created in the company, not just for mental health, but your overall culture, I bet your overall culture is pretty positive, I bet you people that come to work there feel like they’re being poured into versus poured out of, they probably don’t feel like they’re a conduit to, to an outcome of success for the business owner only, they probably feel like they’re part of a team, you know, and if you are part of a team, people are going to be more comfortable to help their teammate, if you’re just a cog in the wheel, for the benefit of the few. No one likes that. And so I think that’s where it really starts. And if you then put a mental health meaning into that culture, you’re probably going to find great success. And so it’s no surprise that you do have that story. Because

33:25

it was, it’s probably in front of every company every day, or at least in some fashion over the course of a couple of years. If you’re there long enough, even if you have a small company only, you know, a handful of people.

33:37

This stats are the stats. So you just happen to create an environment where someone could feel comfortable, raise their hand and think about those three or four steps in that story. You created the company, you you educated to it, it was another person who had who had to act, then recognize then create an action actually call you you had to listen and act yourself. And there’s a lot of steps there. And if that wasn’t because you had a mental health meeting and a poster, it was way before that. I think that’s the thing. I’d want anyone listening and paying attention to this, particularly leaders to really pay attention to smile. That’s my thought on that. Yeah, no 100%, right. You can’t think you say this has to be baked in it can’t be bolted on. So you can’t be a company where people are scared to bring up issues or talk or you know, that they’re gonna get in trouble. If they’re walking on eggshells, and suddenly you say, Hey, we care about your mental health and we want to watch out for you. They’re going to have as much trust and reliance in that as you know, there’s not and so, you know, it really has to be part something that’s really baked in and it’s part of a caring culture is absolutely where it starts. Yeah. And when it comes when it comes to suicide prevention in particular, there’s no like there’s no ownership specifically up that right

35:00

within an organization and in fact, the reality is anyone can be a helper, we truly believe that it’s not specifically your manager, you know, or the president or the executive that are responsible for it. When it comes to suicide prevention,

35:16

the organization really needs to own it and understand that anyone can be a helper, it’s the question of what type of helper that person wants to be, some of them are prepared to engage the way Michelle did, right and have that conversation and be able to work a safety plan with that individual. Some people, you know, it’s just too much, it’s overwhelming, because we’re asking them to have conversations that are not natural, right, we don’t often ask someone if they’re thinking of killing themselves, let alone you know, even at home. So it’s important to recognize that it’s, we all own the issue within the organization, from the, you know, labor right to the President. And it’s important to be able to offer some, we talked about support and training for people, because there is a training, important training component, too, it’s not just natural for people to have these conversations, and be able to have safe conversations and build a safety plan with that individuals. So to make it available to everyone is important. So they all feel like they can be a part of it. We’ll talk a little bit maybe later on around

Randy Thompson 36:27

company called Mates in Construction, that is specifically suicide prevention in the construction industry. And it’s about organizations owning their program. It’s not living works. It’s not, you know, sec underground, it’s, it’s that organization who owns it, and everyone within the organization has a role to play in suicide prevention and supporting their mates. So I just want to mention that it’s not, it’s not just leadership that, you know, that should be trained on how to support, it’s Everyone that owns that, and that kind of helps create that caring culture. Yeah.

Autumn Sullivan 37:04

Yeah, I think that’s so important. Because a lot of times, you don’t want to go to your leader, even if you you know, even if you have a good caring culture, in your company, you might, you might have a hesitation to go directly to your boss and tell them that you’re having a mental health crisis, because it because there’s the risk of it having a financial effect on your family, right, like, oh, I won’t be able to work. If I don’t work, I don’t make money. And if I don’t make money, my kids don’t eat. So you just bury it, but you tell your friend, right. And so your friend on the job also needs to know, also has to have some tools and support on how to help you through that moment, and how to get you into the into a plan for safety. Right, they also need to be empowered, so that they can feel like they can handle that moment.

Randy Thompson

Yeah, absolutely. And they need to know who they can go to. Right. So we have to be it creates an openness, right culture of openness, which is important as well. And that has great ripple effect, just in terms of people’s mental health, right, they know, they are safe in that organization in that environment, a lot of construction work, you know, they they go off site, they work remotely for weeks and weeks, right? Where they don’t have immediate access to family are supports. So even more important in those in those locations, that that there’s that there’s support within that site, that they know that they can talk to someone and it’s often not their boss, autumn. So

Autumn Sullivan 38:32

yeah, training needs to be, I think, available for everyone. So let’s talk about that. Let’s talk about the resources that are available. We have about 15 minutes left, and I want to talk about where where people can go to find resources, what the warning signs are people should be looking for, and then open it up for any questions. So I know you guys have a slide of resources, right? Yeah. Sure. You want to? Did we hit the read the warning signs? I think we had a slide on that, too. I don’t think we’ve gone through them yet. Whichever one you guys want to take first. I just want to make sure we get to both of those. Sure. Yeah. And then we can be and I think the warning signs are, are fairly, some of them are fairly obvious. Some of them are not, but they’re fairly consistent. And there’s a list here, and we often ask, you know, what would you look for in someone but the to me the core is

Randy Thompson 39:22

it what you’re looking for is a change in behavior with that individual, right? Someone might be moody all the time. So having mood swings is no surprise, right? Because Dave’s always like that. But, but Bob isn’t and all of a sudden, you know, Bob who used to be really excited. You know, he was always very engaged as all of a sudden withdrawing from activities. We don’t see Bob very much. So there are different signs that you can look for, you know, you know, someone comes to work disheveled or they’re appearing sad. Clearly there’s something going on there. They’re or they’re depressed. You know, we often see an increase in alcohol or drug use

40:00

with someone who might be dealing with some crisis, but at the, at the end of the day, the core of it to me is, is it’s a change in behavior that you’ve noticed over time.

40:10

And that’s something that could could actually

40:14

click that there’s, there’s something going on there. And that’s where it gets back to that element of community and culture is if you if you have a workplace where those kind of communities are built, and people have enough of a relationship with each other to notice the changes, that’s kind of step one, because it’s hard to recognize changes in somebody if you’re kind of working with a different group every day, and you don’t have any of those established relationships. And then the other element of work of kind of warning signs is again, changes in behavior, but really ones that are tied directly to

Michelle Walker 40:48

their performance at work. So really, you know, decrease problem solving, self confidence, productivity, and then an increase in tardiness, absenteeism, so suddenly, they’re, you know, every Monday they’re off, or they’re coming in late every day with kind of No, no reason, no explanations, increase in conflict increase, you know, we talked before about the safety element increase in your hits, injuries, incidents. So it’s those performance issues. And the really key thing as an employer to recognize as being aware of this and approaching things from the standpoint of instead of instantly addressing it with corrective action, asking why is there this change? Why is this employee who was never late is suddenly late three days a week. And so instead of addressing it instantly, with disciplinary action, asking the question, hey, we’ve noticed this change, is there something going on, that we can help you with that’s creating this and opening up that conversation and allowing them to share, as opposed to if if the first, if the first way that you’re addressing this is, here’s your write up and your final warning, and if you’re late again, you’re fired. Probably that person’s not going to show up the next day. And now you’ve lost any capacity to help that person and probably have X exacerbated what you know, whatever issue they were dealing with. So really taking that

42:05

kind of caring about the person approach and trying to find and understand the underlying issues and root causes versus just dealing with the performance from a disciplinary approach. And there’s we talked about resources, and often come from the world of EPs, and most EPS at their core does offer training, particularly for managers to be able to have those conversations to train them on, what are the signs and symptoms to look for? What are you looking for? What are the performance issues, and how to have a conversation with an employee that shows that you know that you’ve recognized that there’s an issue that you care about them, and that you’re able to lead them to resources, regardless of what it is because you don’t want your managers being the therapist, but you want to ensure that you have the right resources available to that individual to recommend so that they follow up.

Michelle Walker 43:00

So that’s a great lead into resources. So Randy, would you be okay, if I navigated out to the website? Absolutely. Okay.

43:08

Let’s see if I can.

43:14

Okay, can you see the website now? Yes. Okay, great. So we’ll go through a few more other resources after but this is the construction industry Alliance for Suicide Prevention, that I mentioned that Randy and I are both a part of the leadership of, and we have a ton of resources on here, that are all available at no charge to anybody who wants to access them. So they’re here. And so you really don’t have to invent anything, create anything, you can come here and take everything and get a really great start. Um, so here under the get involved.

43:54

Tab is sorry, get informed.

43:59

They just recently redid the website, and I clearly am not as familiar with it. So under here, there’s all of these different items. So building awareness, integrating things, the toolbox talks that I mentioned, are here available to download the training. So first of all, I’ll just go to the Integration tab real quick here. And this just talks a lot about that element that we talked about of how do you how do you really start a program in the workplace. So this needs analysis and an integration checklist. This is a live PDF document that has links in it. So it kind of asks you questions about things you may or may not be doing and then gives you suggestions to address them if you’re if you need to work on those areas, with links to resources kind of on our website off our website, all of our so that’s a really great document. And then there’s some videos here. So you know, what we’ve talked about today is kind of spurred some questions and you want to learn a little bit more. You want some videos to share with your teams. This is a six part video series that we put together that kind of breaks down some of the elements and it’s good to share. So there’s one specifically on warnings

45:00

So that’s a great one to kind of pop into a safety meeting or something kind of really practical.

45:06

You know, here’s the warning signs and what to, you know, kind of super quick overview of what to do about it. And so those are there. Also the training as a bonus, you actually get Michelle, who actually did those videos as your presenter, so you can’t go wrong. That’s not the selling point, right? Yes.

45:28

Click off of that, I’m not going to that. And so on our website also is the link to the living works training. So this is the organization that Randy is a part of. And that to the serious P is partnering with as a training provider. And so we have underwriting available to be able to offer training to part of your team at no cost through this. And so there’s just a link here that you click, you fill out the form, and then we can send you licenses. You can also work directly with Randy, if you want to kind of set up a more robust training program. But it’s it’s a 60 to 90 minute, it’s really closer to 90 minutes, if you do it properly. It’s called start, but it’s totally online based. And so it’s a great tool to kind of be able to equip people to have those conversations to recognize warning signs. And again, they might not, you know, they might go through this and they still I’m still not comfortable to have that conversation. But they’re going to have a lot more awareness to and know what to do and how to kind of connect people with help a lot better after that. So it’s a really great tool that I’d recommend definitely leaders, but you know, we had all of our field leader, so any crew, leader foreman, that type of those frontline managers, this is a great tool for them, because ultimately, they’re the ones that know the employees have those relationships can recognize the signs, that kind of thing. So this is, I would definitely recommend that level for them.

46:50

Another thing that’s on here, is

46:57

the screening tool. And it’s another great way to if you have you know a wellness program, and you’re doing biometric screenings and things to encourage people to be physically healthy, this is a great way to kind of weave mental health into that is encouraging, taking a mental health screening. So this is another one of our partners mind wise, and you click on this link, and it just takes you out. And it’s totally anonymous. But you can go through some different screening tools for mental health, and there’s just kind of a broad general one. But what it does is and why I encourage all of our employees to do it is even if you’re not struggling with something, it’s a really great tool to build that awareness and that mental health literacy, to be able to recognize some things because by the questions that it’s asking, you go, Oh, I didn’t know that that was something that could you know, be be an issue for somebody. So it really is a key part of kind of building that literacy. And then the last thing I’ll point out real quick here is just to take the pledge. So this is, you know, like I said, everything on the site is free, no cost totally available. But we we we want to build kind of momentum and, and presence in the industry for these efforts. And so we love to have companies sign on to say that they’re going to stand up for suicide prevention. And so it’s just a, it’s a pledge that just saying that you’re going to address this in your workplace, it doesn’t commit you to anything, it doesn’t do anything, but stand. And you’ve seen it on some of the slides, but Stan stands for safe. So creating those safe environments that we’ve talked about training. So the training element is, is that important. It’s part of our, you know, slogan for our

48:36

organization. So you know, you’ve got to get people trained, so that they have the information to be able to approach this awareness, making people aware that this is even an issue, normalizing the topic. So getting people comfortable talking about it, making them know that they’re, you know, they can talk about it, there’s they’re not alone, if they’re dealing with these issues, and then decreasing obviously, with the ultimate goal of decreasing suicide in our industry. So that’s on here. It’s just like I said, a quick,

49:04

quick click, and we would love to have people sign on. It also then gets you onto our mailing lists and things like that to continue to receive information. And there’s somebody making a commitment, right? When you say pledge a low, you’re not tied to anything, you’re not bound to anything, but the mental

Randy Thompson 49:21

power of making a commitment to doing something will actually incite behavior and likelihood that you’ll actually do something about it. So taking the pledge we think as important

Scott Peper 49:33

that is great. And these all these resources are right here on this website. So there’s an easy way to get started and easy way to implement it. And most importantly, just start having conversations to help create again, well we talked about an atmosphere where it’s comfortable for someone to talk about it you we don’t need to you’re not soliciting. Here. You’re just making sure the environment is is proper and the people in it are

50:00

We’re also aware, so that when and if this does happen, someone can help prevent it. Yeah. And I’ll make sure that

Autumn Sullivan 50:08

all of these resources are in the description in our YouTube replay as well so that people can, people can access them easily. We only have about three minutes left, we have no questions at the moment, which I’m kind of surprised by.

50:24

So I’ll just open up the room. If you Oh, I did want to say one thing when you were talking about

50:31

talking about telling, telling stories, Scott, and I was thinking to myself about the Deer Park campaign, the department in which we started a mobilization funding, which was our way of helping to

50:44

move the needle on some of the challenges in construction, including mental health and you know, greater transparency and communication between all partners, and,

50:54

and a bunch of other issues. But one of the things I was thinking was, I talk very openly on my LinkedIn about my issues with anxiety and my struggle with anxiety and depression, I’m, I’m just that kind of person, I’m happy to share my stories in the hopes that it makes someone feel less alone.

51:09

And I think that one thing that we could do, and I’ve seen it in on LinkedIn, I’m very

51:16

heartened by by the stories I see on LinkedIn, that’s one thing we can do if you are in a space where you can tell your story, tell your story on a platform, where where multiple people can see it, because it normalizes the conversation. It removes the stigma, when you say, Oh, my boss told story about having depression, or you know, my coworker shared her story of having, you know, crippling anxiety, whatever, whatever your story is, you’re not alone in it. And when you share it, you feel less alone, and someone else feels less alone. And you make social media that replace your bank, your bank,

Randy Thompson

I’ll just chime in here because I to use social media for my journeys. You know, I’ve been struggling with stage four cancer, gone through just a whole bunch of terrible things in the last couple of years with the onset of the pandemic. And I’ve used social media as a means to share my story. And what it’s done is it’s engaged a whole ton of people, most of who I didn’t know before in the conversation, and sharing those stories is so critical. And the interesting thing about LinkedIn is, you know, I use it a lot for professionally as well. And when I share a story or an article or something, I may get a couple of 100 hits, when I share a personal story about my journey I’ve had sometimes over 10,000, which just gives tells you the importance and the impact that sharing real stories, and being vulnerable and open to support can have on you. So I told him, I’m with you autumn on that. Thank you. Yeah, and those of us I’m sure, Randy are positive, there’s people pouring into, you know, time buying them, you know, bashing down? Absolutely. It’s all about resources, support resiliency, hope, right, I call it my bright lights. And Scott, not one negative response or comment, have I seen over the last two years since I’ve been going through this. So

Scott Peper 53:14

likewise, I can say the same for our experience on LinkedIn, in my mind, personally, I had an enormous amount of people pour into us more than anyone tried to pour out or hurt or damage or be negative.

Scott Peper 53:31

And it’s not even I mean, I don’t even think about it as a negative thing at all, because it very rarely happens if at all. And actually the time that this couple times I can think of somebody said something negative. There was such an overwhelming response from everyone else. Yeah. Me to be responding to it that I never even went and talked about it. I didn’t even address it. So yeah, it’s a good way to it’s good place to use. But you know what your intent is pure. And that’s what’s important. You know, when you have good intent, and you truly are trying to help people realize that they understand it, they can feel it, they can sense it even on social media. And so I think that’s really the most beneficial and better back home. Absolutely. I think what both of you guys are doing

54:25

is I just want to say your time and your energy and what you guys have put into it all, and especially coming on and sharing your loss.

Randy Thompson 54:34

My pleasure. Yes.

Autumn Sullivan

Thank you so much for giving us your time today. And thank you everyone for joining us. I will send out a replay link in an email and I will also post it to Scott’s LinkedIn. So if you are joining us on LinkedIn live, there will be a replay available there. All of our replays are available on our YouTube channel and on our website. And then I’ll make sure all of the resources that Randy and Michelle talked about are also included in the video.

Scott Peper

Yes, please go on and connect with both Randy and Michelle. They have great resources not only that they’ve shared here but also on their own personal LinkedIn. And it’s just good information. And I hope this helped everybody and hope everyone gets a chance. And beware, there’s a lot of people out there just ask somebody if they’re okay. It’s alright. If you get a gut feeling to say, are you alright? Just ask. Okay. No one’s no one’s gonna yell at you for asking them if they’re okay. I promise. Absolutely. Absolutely. Thank you guys. Have a good rest of your day, everybody. Thank you.

Your business credit can dramatically impact your company’s cash flow. Specifically, the stronger your business credit is the more options you have to improve and grow your company’s cash flow. Jonathan Fodera, President of Integrated Business Financing, joined us for this special event to discuss the relationship between business credit and cash flow and strategies to build business credit.

TRANSCRIPT

SCOTT PEPER 00:59

we’ll let everybody get a minute or two just, I see people coming in now and participants and on the LinkedIn live. So I’m Scott peeper, the CEO and co founder mobilization funding. I got a great guest here with me today, Jonathan Pradera. He’s a good friend. He owns a business called Integrated Financial, he’s going to talk about business credit, and a little bit more about what he does. And of course, I always have my co host here with me autumn Sullivan. And she is in process of making sure this all works perfectly. So while everybody’s still logging in, we are going to just let her do her thing.

AUTUMN SULLIVAN 01:36

We are good. We are live on LinkedIn, we have participants rolling in. So if you guys want to go ahead and get started, I will be monitoring your LinkedIn live. So if there are any questions, I’ll go ahead and pop back up and relay those to you. You can also ask questions. If you’re here on Zoom, you can ask questions in the chat or in the q&a. And I’ll be monitoring both of those. Otherwise, I’m gonna go ahead and turn my camera off and let you guys have a great conversation.

SCOTT PEPER 01:59

Awesome. Thanks. Awesome. Thank you, everyone, join us now integrated business financing. Jonathan Fodera is the founder and CEO. He is with me today as a guest we’re going to talk about business credit, why it’s important what how you can impact it, what it does for you what it can do to hurt you, and all the different things ways you can get this fixed, repaired or maintain it and things you can check out. Jonathan, I know you’re traveling and thank you for joining us. I appreciate it. How you doing?

JONATHAN FODERA 02:28

I’m doing great, trying to get us a nice view in the background as we’re going through this. So guys, thanks. Thanks for bearing with me. And hopefully I don’t come in choppy. I wanted to kind of help and educate everyone a little bit about business credit, right. So everyone understands that you have your personal credit score, right? And that drives almost every thing that you do. Okay, including getting an SBA loan, a line of credit, buying a car buying a house, well, your business also has a credit score, okay, and it works the same way. But it’s different than your personal credit. All right. So when you’re going and maybe applying for larger jobs with a municipality, when you’re trying to get a piece of equipment, or even get a large loan or an SBA loan, your business credit comes into play. So it’s very important that when you’re doing this, you understand that you have you know, you work on your business credit, and you work on your personal credit. All right now, Scott, if if anyone has any questions, because I can’t see their comments, or if you think

SCOTT PEPER 03:39

the question I usually get and I think it’ll be good for you to touch on this would be just what is business credit Exactly? Like how does how do I get like, like I own a business, but how do I how does my business get a credit score and where do I see it or find it? That’s not something I typically hear? That’s the common most common question I get from our clients or other folks out there.

JONATHAN FODERA 03:59

Got it. So the easiest way to say hey, where can you check your business credit? Dun and Bradstreet, Dun and Bradstreet and Experian are probably two of the more reputable business credit bureaus. All right, and we’ll go into how to establish business credit. Next, right so as soon as you start your company, you get your federal tax ID. Once you have that federal tax ID you can go and apply for your DUNS number with Dun and Bradstreet number. Right. And that’s basically the start of you getting an establishing your business credit. Now, the reason why business credit is important besides for financing, it allows you to separate your business and your personal to an extent not completely separate but to an extent. And what that does is now you can go out and get trade lines from vendors which also helps with your cash flow. Right. So if you can get net 15 or net 30 terms from your vendors Okay, instead of putting that on a line of credit or a credit card, that’s going to help smooth out your cash flow and ultimately allow you to grow the business a little bit faster. Right? So, I want to go over five things that people usually get wrong. Okay, when you establish your business credit, and this will really help. Okay, they’re called the Five fungibility factors. One, you need a business phone number that’s an it can’t be a Google Voice number, it has to be listed to the business. The next one is a business email. So many people have, you know, Scott peeper. Mobilization funding at Gmail, right? How many times have you seen that when someone applies? Or at Yahoo. Okay, it needs to be, you know, Jonathan, at integrated business, finances, super easy to set that up. Just go to Google, and you get a business account, it’s G Suite, and it costs you like $9 a month. So if you’re listening, and you haven’t done that, please make sure you have all this stuff done. Okay. Next is a business address. Okay, and the business address cannot be a Pio box. Now, a lot of people say, Well, hey, John, I’m home based. That’s fine. You can put your home address there. Okay. But you have to have a business address. Okay.

SCOTT PEPER 06:22

Because your business address have to be your mailing address, Jonathan,

JONATHAN FODERA 06:25

it does not have to be the mailing address. Okay. Okay. But it absolutely shouldn’t be a Pio box. You know, we both know being in the industry, we’re in Pio boxes usually indicate. Usually, there’s some level that can be some level of fraud. Having a Pio box, nothing’s verifiable, right, you’re literally just sending your mail to one location. So make sure you have a business dress. Now. Here’s where it’s super simple to tie in. All of those three things need to be on a business website. Okay, this website can be one page. It can be a simple one page website. All right, but not having is going to have you fail out of those five fungibility factors. All right, and the next and the most obvious, having a business bank account. Okay, have a business bank account. So if you have all those things, then what I would tell you to do is go to Dun and Bradstreet and make sure all those things are listed anywhere that your business is online, any web presence you have, should have all those things and they should all match. All right, when when something is pulled, and there’s conflicting information, it can actually hurt your business credit and hurt anything that you’re doing in the lending process. Does that make sense?

SCOTT PEPER 07:50

Does. So those are the five main things that like a Dun and Bradstreet or Experian are gonna look at as sort of the like, what I would call the you didn’t say this, but I’m calling them like prerequisites to be able to have business credit. And once you meet those five basic things, you can, you’re now eligible to have a business credit score, or more importantly, you’re gonna get a business credit score, no matter what you want to make sure you have one that’s going to be positive. And if you have one that’s negative, because you don’t even have it set up. That’s going to be a problem. So I guess my next question to you is, then, how does Dun and Bradstreet decide on what my business’s credit score should

JONATHAN FODERA 08:29

be? Well, that’s a great question. So the challenge that most people have with establishing and building business credit, besides what we prereqs we just went over is that business credit, only, only 7% of companies actually report. Okay? So you want to make sure that you’re using companies that are reporting and you’re opening up trade lines, okay, don’t buy trade lines, you’re opening up trade lines that your company is using, so I’ll give you some real easy ones every single business can use staples can use best can use UI, okay, when you go and apply these places you want to apply using your DUNS number. All right, because then it’s going to report to Dun and Bradstreet and just like a credit card when you go there, use the business credit okay, they might start your off super low, you use the business credit and then you pay it off at the end.

Continuously open up trade lines. So if you have a vendor, see if they can give you terms and they can report all right. So if you know you need the same materials Job and Job out, okay, and you always go Don’t use one supply house, try to get terms from them and see if they report when this matters because some municipalities, okay, and some of the larger jobs you can bid on. If you don’t, if you don’t have a certain business credit score, they might not let you get the government work or the municipality work. On the on the other side, if you go and you try to get equipment financing, let’s say you need a backhoe, okay, but you have no business credit. getting that approved is going to be tough, I just had a friend of mine. Try to buy a lot of trucks and a lot of trailers, but she didn’t have anything recent on her business credit. So we it was, it’s been a much harder process than if she had established business credit that she was actively using. And she does have a good credit score. So this stuff matters, especially when you’re trying to grow and scale your business.

SCOTT PEPER 10:56

Please do so I guess one of the questions is, can you get your supplier or your trade partner to actually report like, for example, if you have subcontractors that you’re using labor, that you’re hiring subcontract labor? Or you’re ordering from the supply house? And it maybe they’re not a large class? Or maybe they are due? Can you ask them all the report? Or do they already I guess too much? Do they already report standard? And if not, can you require ask them to is that something that can be done, you don’t want to wait to know if they’re reporting is to actually pull it. So we can pull this credit integrated. Most people are not reporting. That’s just the fact most people are reporting the ones I gave you. You know you on Best Buy staples, they should report. But those are smaller trade lines just to get an establishing going now, what I go

JONATHAN FODERA 12:02

alright, typically, if we build somebody’s credit, right, their business credit, we can build $50,000 and trade lines within six months, that’ll normally take, you know, 12 to 18 months. Alright. But it is important because as you go on, and as you try to scale your business, take on bigger jobs, and you need to buy equipment, or maybe an SBA loan, you really want that established. So you can ask anybody to report. And hopefully they do, I don’t think you can require it. But if you have open business relationships, and you’re working with, you know, like, let’s say you’re working with my team, we can see if we can have that self report, which would add to that trailer,

SCOTT PEPER 12:41

when you said when you said it’s really expensive. Are you talking specifically about the DUNS program that they try to sell? Are you saying it’s just expensive to have business credit in general?

JONATHAN FODERA 12:51

It’s not expensive to have business credit. But DUNS does have a done for you service. Okay, that is expensive. So you

13:00

don’t need that necessarily.

13:02

You do not need that.

SCOTT PEPER 13:03

Alright, so if I’m a business owner, I want to have established business credit, I see the value in it. I have a business I meet the five fungibility fungibility criteria that I need. I do buy from Staples or Uline. So I have some small credit there, I might even have a credit card that I’m using in the business that isn’t the business name that can be paid for. But I still don’t have a lot of business credit. How do I build that up? What can I do? You want to just open more trade lines, trade lines. So what does Dun and Bradstreet do that as a service? Or do you offer as a service in order to help build those trade lines up to where I can have 50,000 helped my business credit shows I’m worthy of a $50,000 credit limit or 100? Or more or whatever?

JONATHAN FODERA 13:55

Yeah, so what we do is we have a team that specializes in it. So you would, you know, inquire about that first. We don’t we don’t offer that to anybody, unless we’ve actually pulled their business credit first. Because if they already have established business credit that’s really strong. We don’t want to pay for something that we’re really not going to help. So what we would do is we’d have a review, we would do a review with you. And then if we think that we can really help and add value, we would connect you with our team, they would they would literally direct you who to apply how to use it. You know when to go on to that next level, that next vendor, because what happens is a lot of these companies change who reports and who does, right so it’s we our team stays on top of who’s reporting how they’re reporting and what bureaus they’re reporting to. So let’s say somebody only reports to Experian and we need them to report to Dun and Bradstreet, we can actually go in there and self report so that that’s really how the service works now. If you are in construction In one manufacturing or anything like that, the other way, use your business credit, right? So let’s say your business credit is established, and you need to get a $40,000 piece of equipment. Well, you should be financing that equipment, because that will absolutely report, we can help you finance that equipment, it’ll absolutely report to your business credit. And as you build your what you’re doing is you’re putting comparable debt on your business credit. So let’s say this time we got your $40,000 piece of equipment, maybe in six months from now, business is growing, you want to get an $80,000 piece of equipment? Well, you have comparable debt on your business credit profile, which makes it an easier transaction to get done.

SCOTT PEPER 15:45

Does that usually does that usually result in like lower interest rates on equipment or better, better terms?

JONATHAN FODERA 15:53

It can. Absolutely.

SCOTT PEPER 15:58

So all right, so let me change gears on you for a second on that. So let’s say I have a business, it’s been well established. It’s it’s five, six years old, I have some business credit. But then I had a bad project or a bad job. And my credit gets hurt both couldn’t be personally but definitely in the business credit gets hurt or dinged. What can I do to repair that? Or fix it or make it better?

JONATHAN FODERA 16:24

It depends on what was damaged there. Right, like personal credit would work a little bit differently personal credit is your your 30 days behind on a car payment, right? Business credit. It’s going to depend on what trade line it is, how big was that trade line? And you know, How late are you if you pay it and bring it current that’s going to help you. Also if you have a few established other trade lines that are strong and larger, that’s going to help you like credit is oh, wait on one, are you making all your payments on time to how many trade lines are how many? How many people have issued your credit? And three? What is your utilization? Right? So anytime that happens, it’s alright, you want to you got to bring it current, and then use it the right way. Okay, and then ultimately, if you can open up more tradelines and use them and make sure their current that’s always going to show a positive pay history. Gotcha. So,

SCOTT PEPER 17:28

again, going back to construction, or manufacturing, because that’s a lot of our clients and our audience, in the business credit world outside of equipment financing, and maybe an SBA loan. And frankly, a lot of the SBA loans that I’ve seen given to a client, it relies so little on the business credit side to help them get it necessarily as much as it does like the financials and the cash flows and the tax return the general business itself. Where what priority should we be putting our business credit in when it comes to trying to get a loan on the business?

JONATHAN FODERA 18:03

Oh, equipment financing is really where it’s going to come into play. Okay. And then I would say bidding on municipality work or government work comes into play SBA, like you said, sometimes it does make a difference, right. But for the most part, like or a very, very large transaction. Like I know, a couple FinTech companies that if the business credit is not strong, and you’re trying to get more than let’s say 200,000 300,000, that will, that will absolutely factor. Okay. But an SBA loan, like you said, it’s primarily going to be what’s, what’s the financials? how profitable were you? What is your personal credit? What collateral Do you have, you know, to support and backup the money that you’re trying to borrow?

SCOTT PEPER 18:51

Okay. You know, one of the questions, does it help business credit if your financials are done by a CPA versus internally prepared? Or if you get reviewed or audited financials? Will that help business credit?

JONATHAN FODERA 19:06

No, that that really doesn’t come into play. There’s business grade, that’s kind of like, personal credit to right. So it just it’s always reporting is who’s offered you credit? How have you paid them back? And what did you utilization?

SCOTT PEPER 19:22

Okay. So for everyone that’s listening online, a couple things I want to point out first, if you have any questions, go ahead and put them right in the q&a box. And I’ll be able to answer the ask these straight directly. In the meantime, I’ll keep tick fire off the questions that I’ve gotten in advance that people have provided to me. So hopefully, I’m doing a good job and getting those questions out and anything I normally hear. So I’ll switch gears, we’ll go ahead and do that in the q&a box now, if you’d like and I’ll pull those up.

JONATHAN FODERA 19:49

And hey, and anyone that’s listening, if you guys want to know where your business credit is, just reach out. I’ll try to get a link in there to schedule a time to speak, if you guys need help with anything, or you could just reach out and message me, I am traveling, I’ll be back in the office tomorrow. So please bear with me, if I don’t get back to you until tomorrow.

SCOTT PEPER 20:12

For everyone that’s on, we’ll put Jonathan’s contact information, his website, on the LinkedIn post when we recycle this back out, and we’ll make sure that it’s attached and in a spot where you guys can grab all that. Um, so Jonathan, going back to, outside of business credit, let’s talk a little bit about the lending side of it. And as it relates to business credit, so let’s say, you know, my business credit I’ve not paid attention to, I don’t really need to buy equipment, I do want to make sure I have, I don’t want it to hurt me, it leaves maybe can’t help me, but I don’t want to hurt me. What are some other things that I can do to make sure that I get any equipment now? But what about I don’t have business credit, what are some things I can do to make sure I can qualify for the equipment or the vehicles that I want? Or if I am thinking about getting an SBA loan or some other type of business loan, what are things that I can do now that I should be paying attention to, in addition to business credit?

JONATHAN FODERA 21:14

Well, a couple of things is one anytime you take financing or apply financing, you should know where where you stack up, where you stand. So how’s your personal credit? How’s your business credit? You know, very, very rarely, do you see what we call a corporate only business transaction. And that’s just somebody that is solely using their business credit, to get a piece of equipment. And for that, you have to have outstanding business credit. And typically, I believe, either five years in business or seven years in business, and have a lot of comparable debt. Okay? Now, for the average business owner. Okay, what you can do is you can check on Dun and Bradstreet, make sure your business credit is one established and two looks alright. And your personal credit, right, because equipment financing, those are, those are going to be two of the bigger factors that weigh in one if you get approved or not. And two, how much you get approved for. And the other thing they like seeing is on the right is want to see comparable debt. All that means is if you’re a logistics company, you know, you’ve financed trucks and trailers in the past, or if you’re in construction, you know, you finance a couple bobcats, you finance a couple of combat shoes, whatever, whatever it is that heavy equipment that you use it, okay, so having that comparable debt on there is very helpful. And if you don’t have comparable debt, because you’re younger company, my suggestion is make sure that you have strong personal credit, strong business credit, you keep a decent amount of cash in the bank, and then I can help you get, you know, those first couple pieces financed, then they get seasoned or aged and then they’re on your business credit profile. And then it’s easier if you go back and let’s say six months or 12 months to get another piece financed.

SCOTT PEPER 23:08

So one question from on, we just got from Russell, what type of financials? Let me open that up. What type of financials like what kind of revenue position? Business Owner FICO scores yours in business collateral would a subcontract or typically need to establish a line of credit with like a commercial bank or credit union? What do you see as the minimums to establish with a line of credit with a bank? So I guess the question, if I were summarizing here, this credit is given what are some of the minimum expectations that a bank, in your opinion is trying to see if they want to get a traditional line of credit? And I get, let’s just say, for this not articulating here, let’s just say it’s an appropriate size line of credit for whatever you need for the business that says,

JONATHAN FODERA 23:55

Yeah, happy to help, I can only answer to what my programs would look like. Mine are pretty traditional. So for a line of credit, you’re going to want to see two years in business, at least $30,000 a month in revenue, eight, eight plus deposits, okay. So you want more deposits going into the bank, you want steady cash flow, when I say steady cash flow. You don’t want to see any negative days. You want to keep rule of thumb between five and 10% of whatever your top line sales are, as an average daily balance. So let’s say you’re doing $50,000 a month. Ideally, we’d like you to have $5,000 average debt average daily balances on the low end of the credit spectrum 650. Anything above 650 is a plus. So those that’s where I would say your bare minimum or that’s where the credentials would be. So two years in business A 650 credit, at least $30,000 a month in revenue and good cash flow.

SCOTT PEPER 25:08

I can add to that question too. I just attended a conference two weeks ago where some of the larger banks and some of the smaller regional size banks, but six different banks were there. And they talked about their criteria, there was a few things that I took away from that one was they all care about personal credit, for sure. Even though it’s on your business, they absolutely care about that. The minimums ranged exactly from as low as 570. But that was specific to a micro loan product by one credit union only here that happened to be local, and those loans only went up to 15 grand. But the minimum threshold was really that 640 or above, for significant lines of credit, they wanted to see 680 and even over 700. And then that was just personal credit, the business needed to be able to show that it could cashflow, typically one and a half times the debt service to be able to handle a traditional loan like an SBA loan, if it was a line of credit. They didn’t give specific criteria on set, well, they gave a criteria on the credit. But from a business perspective, they want to see that it’s appropriately sized, they are going to have specific uses for that line of credit, they want to see it used and paid down, almost nearly used and paid down on a monthly basis. Even if you were to use it, pay it down and immediately redraw the next day, they want to be able to see that you’re using that line of credit as not alone, but more as a use of free cash to handle differences between payment terms that you may have with a supplier or payroll bridging gap bridging the gap between when you’re paying not and they want to see the financial discipline on being able to do that hard to do when you don’t have a line of credit. And in some of the industries. They were just just completely agnostic to the fact that if you were in construction, for example, some banks just weren’t going to do that at all. So I would say aside from other things you can do in personal credit, do not make the assumption that all banks are the same. Find your smaller community size banks where you can have a relationship with a specific banker and get in now, before you ever need or want a line of credit, you’re going to need to build a long term relationship with them face to face, somebody that can work and advocate on your behalf. That was the biggest takeaway I took from them, they made that point clear. So get in, build a relationship with them. Make sure you have some deposit accounts, let your face be seen. Show them a business plan, show them where you’re going what you’re trying to establish, let them know you don’t need them right now. But you really are going to look forward to them on as you execute, give them that give that banker the information that you can submit to and start building that rapport. Are there any other questions in there? At the moment? Jonathan, I have a question for you. What are some of the tip? What’s a typical question or two that you are typically asked, but no one’s asked, or I haven’t asked you yet today?

JONATHAN FODERA 28:20

about business credit, or just in general?

SCOTT PEPER 28:22

I’d say business credit for sure. But if there’s some other nugget in there, yeah, definitely. But any other questions on business credit or repairing?

JONATHAN FODERA 28:30

Or I think I think the biggest thing is people ask when should I do? Right? That’s not that’s one of the things that everyone wants to know. And the truth of the matter is, it’s like planting a tree. The best time to plant a tree was 30 years ago, the next best time is today. All right. So the thing is, with business credit, it does take time. Okay, it takes time to build. So you want to start today. Okay, anytime you want to apply for financing, think about it. Scott, we see We help business owners all the time get financing to grow their business. However, how many times does somebody wait to wait or wait till they absolutely need the financing to reach out instead of contacting us prior to when they need it? planning it out? And understanding you know, that you want to be in a good position like the best time to apply for financing is when you don’t need it. Why? Because your credits probably strong, your cash flows probably strong. We’re going to be able to get your line of credit. We’re going to be able to get your project project funding, we’re going to be able to help you right you don’t want to wait until there’s been a severe need the cash flows banged up. You started you know leveraging your personal credit cards to float things and now your personal credit is is struggling. So with business credit. The best time to start is when you start your business, okay, but if you’ve never focused on it. It’s something you should look into today. And if you need help reach out, I’m happy to do it. All right, that’s something all type of financing you want to apply when you don’t need it.

SCOTT PEPER 30:14

I would add one thing. It’s funny, you said that that I also took from that conference was you. There’s three folks you need to get on early before you ever need them. And that’s your CPA, your banker and your attorney. And so I think you just hit the nail on the head right there you want you want to put those folks on your team in your corner and be communicating with them way before you ever need them or ever crisis. Those are going to be your best friends and business outside of outside of your current immediate team, of course. Absolutely. Does anyone else have any other questions? You do? Put them in the chat. Jonathan, is there anything you want to we’re coming up on our time here? And I want to make sure I’m appreciative of everyone’s time. But is there anything that you want to add? Talk about that we haven’t touched on? I don’t see any other questions popping up in the chat?

JONATHAN FODERA 31:07

Nope, I appreciate you, brother. Thank you. This was a, we made this happen. I’m super happy we we could get this done. And I appreciate you. And it was we’re both here to help anybody that’s watching. So you know, you’re you’re in good hands.

SCOTT PEPER 31:22

And I will make sure I get on the comments and LinkedIn. Jonathan’s information where you can reach him at I’ll also, it’ll also, of course, be on our website and the replay of this where you can always access on our YouTube channel, on my LinkedIn, you’ll be able to see this, but it’ll be also a link to our website. And we’ll make sure we have all the info there. So between our YouTube or website and the LinkedIn, there’ll be three places you can find that as well as Jonathan’s website directly. Awesome.

AUTUMN SULLIVAN 31:52

Wonderful. All right. Thank you guys. Thanks for great conversation. Thank you, everyone, for joining us. And yes, I will make sure that all the links are in the YouTube description and in the replay email if you registered via zoom. Excellent.

SCOTT PEPER 32:04

Thank you all for joining us. We really appreciate it. Have a great rest of your day and enjoy the rest of your week. Bye bye

Is college REALLY the only path to a stable income and rewarding career? Is construction REALLY a “dead-end” job?

Of course not. But many Americans believe them to be true.

It’s important for those of us in construction to change the narrative, raise awareness, and offer a new perspective for the industry.

This was a panel conversation featuring leaders from the skilled trades and higher education. We focused on the pros and cons of going to college or going into the trades, the myths versus the reality for both, and how the best solution for people might not be an “either/or” mentality, but a path that can encompass both.

Autumn Sullivan 01:40

So we have we have people joining, and we have a lot to talk about. So let’s go ahead and get started. Thank you, everyone for joining us today. With me, as always is my co host and the CEO of mobilization funding. Scott Cooper. Hi, Scott.

Scott Peper 01:56

Welcome. Thank you. Welcome, everybody.

Autumn Sullivan 02:00

And our guests today are we have a Selye Mubarak, who is an author and keynote speaker in the construction industry. We have Natasha Sherwood, who is the Executive Director for independent electric Electrical Contractors Association of is it West Florida or

Natasha Sherwood 02:16

Florida, Florida, west coast, but it’s it’s everywhere except for four counties.

Autumn Sullivan 02:22

And we have Matt Vetter, who is the president of Shaffer construction. Thank you all so much for being here with us.

Matt Vetter 02:28

Thank you. Thank you.

Saleh Mubarak 02:29

Thanks for having us.

Autumn Sullivan 02:31

Um, to kick it off, I would like to ask each of you to share your story on how you got into the construction industry. And also, I want to know whether or not you went to college? Where do we start?

Natasha Sherwood 02:45

I’ll start. Like, I’ll just run with it. My name is Natasha shoreway. How did I get into the construction industry and my dad was a construction attorney. So that’s probably how I first got into it as a as a kid. But then am I was actually a K through 12 principal. And we started addressing education needs and found out that in Hillsborough County, and in Florida, we were importing more in construction labor than we had. And we were actually paying for DMS and I got on a task force that ended up finding can transfer me to this job with anything electrical contractors. And so then really just got in depth with our apprentice program and kind of took on a life of its own. So now run the Florida apprenticeship Association, as well, which runs all kinds of construction, and all kinds of it apprenticeship. So that’s how I landed here. And yes, I went to college for seven football seasons, and received a lot of degrees in that timeframe. None of which Am I using?

Saleh Mubarak 03:46

Likewise, which I share a similar story to that. So why do you want to go next door? Sure.

Saleh Mubarak 03:53

Well, going to college was was not an option. My mom was a school principal, very tough on us. The The thing is, I have a one brother older than me and one sister also older than me, both medical doctors, and another sister who’s a pharmacist. So there was pressure on me to go to the medical field and I kind of you know, registered and then this is back in my home country in Syria that time. And then I changed now I don’t want to be dissecting frogs. And so I changed to civil engineering, which I liked. And in my graduate school here in the US, I did my master’s degree in structures and mechanics. So I had work experience in structural design. And then I found that it’s dry subject. You know, you’re going to sit in by yourself in a cubicle, doing design and I’m, I’m very talkative. I’m, like, you know, I’m a people’s person. So I find aren’t that project management is my cup of tea and I switched I did my PhD at Clemson University. So as they say, my blood runs orange. And I love it. And this is new news. Nobody knows except for my wife. I signed a contract two days ago with why my publisher Whitey, for my third book on construction project management. That’s awesome. Good for you. Thank you. So you guys are my references if I need help, Matt, Scott and Natasha. And, of course, you know, if I need a question and construction management, you are my references, please?

Matt Vetter 05:44

Absolutely, anytime. So, with that, I’m Matt better. I’m the president of Shaffer construction. We are a commercial general contracting firm in southeastern Michigan, I got my start in construction. In my my late high school days, I started on a residential crew, basically carrying wood around the job sites and kind of a general labor. Through that I’ve, I’ve worked in and touched almost every type of construction, I switched into the commercial realm. And right around 2008, when everything was kind of falling apart, I’ve owned several companies. And now, you know, Shaffer construction is where I’m where I’m at, it’s my, it’s my burn the ships project, and we aren’t looking backwards. So we’re rapidly growing and having lots of fun doing it. I did go to college, I graduated from U of M, University of Michigan. I have a weird story about my past, we can get into that maybe later. But my degree is in psychology. And I would say I actually use it probably every day. And when I do.

Saleh Mubarak 06:56

Math, what kind of construction do you do?

Matt Vetter 06:59

So we build everything other than single family homes. We do a lot of light industrial, commercial work. We built office space back when people still use them. You name it, we do it. Vertical construction, not not horizontal, right.

Scott Peper 07:17

For those of you that don’t know, I got my start construction working for my dad he had it was commercial Glaser contract, man, contract laser, doing glass and aluminum. So I wouldn’t be on those job sites in high school and summers, certainly all through college. And like Matt, I just basically did whatever I was told I carried wood, I peel the stickers off of the class. Back when I was doing insulated glass, they actually used to take two panes of glass and a hot rubber gun and insulated themselves. I know that doesn’t exist anymore. But I had plenty of burns from that. As well as peeling all the little stickers off the glass and carrying it to the polisher and who knows what else working even on the cutting table. And that definitely helped me understand that I wanted to get into the construction was fascinating. And I liked it. But I also went to college, mostly because I wanted to play basketball when I left high school and I needed somewhere to continue that dream of mine. But I ended up getting a degree in marketing and business and food, hotel Hospitality Management. And candidly, I probably don’t use much of what I learned there. I’m sure I learned some structure. I learned how to make some friends, I learned how to get in trouble. And fortunately, I made my way out. And so that’s where I land now.

Autumn Sullivan 08:30

Yeah. Yeah. I think that’s a good segue into my next question, which is do you how do you use your, your college education? Now in your construction career? Like Matt, you were talking about that you got a psychology degree, but you feel like you kind of use that every day? So whoever wants to go first? Or if you don’t use it at all?

Natasha Sherwood 09:02

Matt, you’re gonna jump in with psychology? Yeah,

Matt Vetter 09:05

I can I can touch on that. So I, I do feel like I use it every day. You know, my role now is the owner and kind of the guy leading the ship. You know, I deal with everyone from the day laborers on job sites to C suite executives that we’re working for, and, you know, in in sales and marketing in general, learning the human psyche and how, how we all work, how we tick, you know, it’s proven to be very helpful. Now, I would be lying to you if I told you that when I was coming out of high school and going to school, going to college that that was my plan. Right? I mean, my my colleagues and my co workers that have degrees, they have construction management degrees or engineering degrees and you know, normal track education for what they do. So it’s part luck, I think and it’s part you know, the universe working for me but it is It started off really as a, as a field that interested me just on a personal level. And I’ve been able to kind of take that and spin it to help what I do now.

Natasha Sherwood 10:11

I would say I said, I didn’t use any of it, I have degrees in public relations, sports administration, mass communication, and political campaigning, I just thought I would like try to cover all the colleges at the University of Florida and see if I could get something from all of them. And I will be made, I would, again, be remiss to say I don’t use it, I do a lot of legislative and lobbying work, but I’m never running a campaign again in my life. And obviously, I’m sitting here on a webinar, so I use mass communication. But a lot of what I feel like I use from my experience in college is the things that I did outside of that I did while I was in college, but it truly was on the job training. So whether it was working in a legislators office, I work for the football team, and it is that structure it is that dealing with people it is the Getting Things Done. And I think that aspect is really transferred into being able to work well in the construction industry that we do, especially coming in from someone outside, when I came in the past few years is that anywhere I’ve gone, and I probably learned this again, working outside the classroom is learning all the aspects of it. So whether it’s the carrying the wood, or scraping the stickers off, you know, I was trying to learn. So I would go out to my contractors and try to figure out what they were doing. And I think working with people is the part that I probably learned the most of college if definitely wasn’t learning how to like, write the code to do a website back in 1992. Because none of that exists anymore. Right? So some of that coursework is not there. But I think it’s the part that I learned outside of the classroom in college that really transfers into what we’re doing now.

Saleh Mubarak 11:41

I have to interesting story about my using my background. You know, there’s there is a match now between my educational background and what I do, but what I did in the master’s degree was structured design. And I finished that in 1985. So it was a long time. In my work, brief work experience was in 8283 in instructional design. Now fast forward, maybe almost 30 years from now, If Natasha, you are in Tampa, right? Correct. Remember when we had the big hurricane? Was it Irma? Or was it thinking I was almost like 2006 ish timeframe? Like we had like,

oh, no, no, it was something was 2016 17. I don’t remember exactly. But it was a Michael, Michael. Michael. Yes, Michael. So it was funny that at that time I was with my mother who passed away later on. She lived with my brother and sister in Panama City, Florida. And my children, the you know, all the guys put they have an annual trip. They went outside the United States at that time and they left their wives and kids and we felt my wife and I sorry that the wives and we have one daughter and two daughters in law. They were without their their husbands. We have to go back to Tampa. So we drove back and we looked like crazy on the highway. Everyone was leaving Tampa when we were the only vehicle driving coming back to Tampa. A shock was when they decided that they wanted to go so they travel all of them all the you know, ladies with the children, they traveled to Atlanta, we have relatives in Atlanta and I told my wife, I’m not leaving Tampa. So I decided to with the limited means I had to board my glass doors and so on and I used my structural background, I told my wife, I said, failure happens because of deflections. And the deflections happened in the middle of the pain. You know, talking about glass, scotch. So I pulled some furniture, I got some two by fours I had and some boards. And I bought all my house and said I’m not leaving. And we got stuck on the TV waiting for the news. And then and we prepared and walk in closet to sleep in and then by 11 o’clock pm. I remember the good news that it’s not going to be as bad. Right?

Autumn Sullivan 14:25

Which is always one thing with hurricanes in the Tampa Bay. Well knock on wood so far that has been I think

Natasha Sherwood 14:33

it’s because there’s Jose Gasper is gold is buried in Tampa Bay and no hurricane get hit. According to my dad, I get structural engineering forget anything else. The whole thing is in causes gold is down there somehow helping us. Yeah, and I

Scott Peper 14:46

have heard that many times myself.

14:49

cavalier about it? Yeah.

Autumn Sullivan 14:52

I think you guys all touched on a really interesting point. And it’s one of the things I want to focus on in this webinar, too is is the whole fact that it’s Learning like college is a way to learn. And we’ve also talked about, you know, we all have probably, I guess, by our ages and slay you are nice enough to announce how long you’ve been Where you’ve been working. But it’s it’s your education over time. It’s not just one way one method and college can be that. But it doesn’t have to be that immediately after high school, I can tell you personally, I would have benefited much better learning in college, if I went in four or five years later, I can also tell you that I’ve learned more from the books that I’ve read than I ever did in college, cumulatively. And even even candidly, from even some of the experience of certain work experiences I’ve had, I probably learned more from books, I certainly today in my everyday life, implement, use, and actively apply the things I’ve learned from a book in my everyday life that I that I couldn’t even draw a line to, and anything I learned in a classroom or a study. Now, I’m not an accountant or a doctor or a civil engineer. So there’s some there’s some perspective to have there. But what I think is, it’s the maturity level of going from high school directly into a college and trying to indoctrinate yourself into what do you want to learn, and oftentimes, you go to college, you don’t even know what you want to major in yet. And I think you couple that with an expensive cost to it. And then you look at the practical nature, what happens when you get out life? economy, jobs, inflation, other things, and you realize quickly that that might not have been the best thing for me at the moment. Is there anything that you guys can touch on as to why you think there’s a stereotype that you have to go do that? And for the people that don’t? Why don’t why does it okay, are just as accepted to jump out into that? And I guess what’s related to construction a little bit to Scotty, I

16:53

think, like,

Saleh Mubarak 16:55

I was going to say, I may not agree with you that going to college? Well, it can happen four or five years later, but I would say the United States has a very flexible academic, you know, system that allows you and we are the only country as far as I know, as far as I know, in the world, that allows you to go the first year freshman as undeclared. And then the other flexibility is that, okay, let’s say you you chose marketing, after two years of studying marketing, you said, That’s not for me, I like computers, I want to switch to it. So they allow you to switch, yes, you may lose a couple of credits, but at least they allow you many other systems in other countries, they don’t allow you. But what you say what you said, applies to graduate school. During my work as a professor, I get people who come to me once want to do a master’s degree, and they want me to be there, you know, to supervise their thesis and so on. And I see a profound difference between those who did have work in engineering or construction after the bachelor degree, and then come back later, 10 years later, five years later to do the masters. And those who want to do it immediately after the bachelor degree, I will mention only one difference. Those who don’t have experience, they come to me and say, Professor, can you give me a subject to do my thesis on the others have subjects on mind? And they want me to critique I want to do with this or this. So that’s, but it’s very interesting. I promised autumn that I have a brief PowerPoint presentation on experience versus education. As much as time allows us, I can I can show you a few words, slides.

Natasha Sherwood 18:58

I think that’s changed some too, even though it gives us I have a daughter as a freshman in college now. And I have a high school sophomore, and as they are, she had to you can apply undeclared, but like when I applied it, no one declared a major but so many of them you are applying to certain colleges even even as a freshman now I think that is leading into some of that disconnect, you know, my my freshman who my who just finished her years changed her major three times and you know, eight months, right you know, I mean, she went in this pre med and I think she’s coming out as accounting or some you know, it’s it’s a little bit of craziness on that and I think from some of the studying I’ve done I was a K through 12 principle I put it in my bio I am like a recovering college for everybody. I ran a school for low income students to try to make them college ready thinking that that’s how I was going to solve or contribute to my community like that’s that’s what I was going to do to make a difference until we started finding out that there were options that were not only fulfilling and essential you know that crazy word I never want to hear right essential is one of those words we can we can ban from addiction arena we can be happy is that I wasn’t exposed that that was a career and I, from my research and so forth, a lot of that happened post kind of World War Two. So you went into that area that was at 1944 timeframe when it started becoming the push towards college rather than hard work. And there’s even a poster that says, you know, work smarter rather than harder, and that somehow hard work became the bad thing. And so I think that’s what they have, I believe led to some of the idea that college and then we, we sold a somewhat of a lie. And I’ll say I sold somewhat of a lie that college was a way to escape poverty. And that college was going to be the answer. And whether that was basketball, so let’s play sports to get you out of poverty to get you into college, or let’s do really good in school, they get you out of poverty and, and then what we’ve done is created a gap of skills that we all need. And we’ve created a gap of with people with education that doesn’t necessarily fit what they’re passionate about. And we’ve somehow to an extent as a mom, a high schooler, but we’re starting to, in my personal opinion, ruined some of high school. You know, my, my high schooler can’t take the classes that she’s liked to, that she’s to have fun and learn and actually learn about so she wants to learn about marine biology. But we’re telling we, her guidance counselor, Tiller is no need to take AP Physics and AP, calc A B and A B BC. And she’s like, I hate math. But if you want to get into college, you’ll take D she’s like, but I want to work with sharks. I want to take marine biology, you know, and so it has trickled down. And at some point, I believe we’re making that turn kinda like the hurricane that turned off in a far right, we’re just not turning quite as quickly as some of those Hurricanes were kind of turning slowly. But I think we’re starting to see that, that gap, as in need to fill and so you go back to Scott, when you said kind of about accounting or med school, I, my personal thing is, and maybe 10 to 15 years, we will see college more as an apprentice program. And many of those, if you look at med school, it really kind of is a really the apprentice program, right? Like you are doing related technical instruction during the day. And you are interning and doing other programs. And I think we’ll see a shift towards that, except for things. Engineering is one of the ones I always think of engineering accounting, where there are actual things you learn in class, they’re actually applicable to your class. But I think that’s where we went that post, you know, World War Two, or poverty kind of hit and we wanted to get out of it. And there’s that poster that many of us all, you know, you had the guy working dirty and tired, and the guy had a graduation cap and gown, and somehow one was better than the other instead of both being great additions to our country. Right.

Matt Vetter 22:35

So I think that’s that’s just it, Natasha, and I don’t know that it was even necessarily that long ago, I think within the last 30 years, we have allowed our public school system to go down the toilet. And, and we started removing shop classes from school around 30 years ago, and there was there was economic, purely economic reasoning for that, because you can’t put a standardized test on a shop class or a whole Mac class. You can’t standardize that, and therefore schools can’t can’t fight and gain funding. And, you know, I could go down a rabbit hole of governmental corruption and making the people more reliant on government by forcing us to not learn how to how to handle things on our own, how to build how to create, I don’t know how much time we have or

23:25

part two. Yeah,

Matt Vetter 23:27

but I think that’s just it in that, you know, we’ve we’ve, we’ve told kids, that college has to be the way that if you don’t go to college, you’re going to be the the dirty mechanic, turning a wrench. And somehow, we’ve made we’ve allowed that dirty mechanic to be the poster boy for what we don’t want in life for our children for our futures. You know, and instead, we push kids, you know, 18 year old kids to Scott’s point, and we push them into college, we wrap them up in with hundreds of 1000s of dollars of debt that many of them will never repay. And we kind of kick them off the dock and say, go go swim. And let’s see what happens when we could we could change this scenario, and start pushing more trade based education for those kids that were at Fitz, right. College is a great choice for some. I don’t want my brain surgeon to come in and tell me that he learned how to do brain surgery by watching YouTube videos. But it’s not the right choice for everybody. And I think there needs to be that that distinction made and then a larger effort to kind of popularize and promote trade based education.

24:36

I think it’s important just go ahead.

Scott Peper 24:38

I was just gonna say if if they if the folks come out of college knew that the dirty guy turned on the ranch have a better, much better ability to pay the college debt off. Then they might actually just went into that right out of the start because a lot of folks come out of school and they just want to make as much money as they can. They don’t necessarily have us. That is a high end goal for them. At the top of the list of four or five things more than it is, this is my purpose in life. And this is how I want to attack it. And for those people in particular, I think you might find, go into somewhere where you get some money, you feel good about yourself, you’re making that money, and then maybe you, you find out dig in to the mechanic aspect. You love cars, and you want to either own a car dealership or you want to bring in exotic cars, you can find your niche in there, and then you can go to school for that and slays point you could do that at night or on the Internet, or you could go to school, while you’re going to add to touch I didn’t want to

Natasha Sherwood 25:35

know it’s always it was just tagging on to put that in as we and that’s part of my huge that’s why I was in Tallahassee yesterday is working on those trade schools and apprentice programs and, and presenting them in this is my big part is not in an alternative to college, that is an equal opportunity to college. And that the assumption we need to change the mind frame and so I’ll be at the American guidance counselor’s conference sometime coming up, I think in June, like guidance counselors, teachers, parents, that it is not the alternative just because your kid is not smart, that we will give them a great option that’s, that is trade school. It is that this amazing kid has the option. Every amazing kid has the option of what is best for their future. So is that college is that CTE career technical education is that an apprenticeship is that trade school? And I go back to my daughter who’s number five or 10 in her class. So the child’s like, you know, she’s just got a mind the world. They never asked her if she wanted to go to college. Now, she probably will. They just assumed that she wanted to. And they were making her drop her career technical education that said, she’ll be vet tech certified. When she graduates she’ll probably make more money than me with regret she could if she wanted to graduate high scoring, she culinary marine biology, she was they were telling her she had to drop one of those. And not even finding out what her passion was. They just assumed that college was the answer. And that’s the part that I think the biggest the tag on to what Matt was saying is lame at some point, gotta figure out what people students are passionate about, or want to do. So then when they go into the workforce, whether it is as an engineer, as in construction, whether it’s marketing, whether it’s running in association, that you can be passionate about it and want to go do well. And just assuming that college is it can be it may be the right thing. Like it can be great. It is a great, man, I have great time in college. Don’t get me wrong, I like going back. But I think the same as I would have done a lot better. My graduate school grades are a lot better than my undergraduate school grades. You know, because I I appreciate it. I read books for information rather than the night before hoping to pass an exam. And so I think that’s the part is in it’s even lower than high school. We’re working with middle schoolers now. So we’re working with Junior Achievement and middle schoolers. And it’s like you have this big gap. Everybody remembers kindergarten when you had like, let’s learn about the helpers week. So you learned about firemen and you learned about you know, law enforcement and did we ever bring in a mechanic? Probably not. But who fixes your car and who builds your building? But then after kindergarten we stop right we forget about any kind of helpers and all we worry about is social emotional learning and this and that. And and then it’s high school and oh yeah. Do you remember in kindergarten which which which helper Do you want to be? And so it’s that aspect of you know what that mechanic turning the wrench may have to Corvettes in a really nice pickup in his backyard to you know, that he paid for without debts. And those are good. You got to make construction sexy.

Autumn Sullivan 28:33

That’s the that’s so I love what you just said we have in Florida we have. We have the great American teacher. I don’t know why it’s called the Great American when apparently only Florida participates in it. But but maybe it’s just aspirational, and we need more states to get on board. But I went and talked to my daughter’s kindergarten class about what it meant to be a professional writer like to make writing your career. And I was thinking to myself, gosh, we should really have a campaign where like construction leaders and laborers come in and talk about what they do for a living like they were interested that I wrote for a living but what they really wanted was for me to read them a kid’s book right because they’re kindergarteners. But if my husband had gone in and brought like ductwork and talked about H fac they would have been fascinated because duct work looks cool, right? Like they they’re a bulldozer

29:23

or Right exactly. It’s you step on in the middle of the night when you have little kids you know they just goes because the fire man brings the fire truck and the police officer brings her police her cruiser you know so So bringing back you know bringing back the the fascination with construction as a career and at a young age I think is an important part. I’m interested though because all of you used the same you know, dirty mechanic stereotype. And yes, the eye That is the stereotype around construction, right? There are lots of negative stereotypes around construction and lots of really positive stereotypes around going to college. I am curious if that is, if there is a chicken in the egg component to the culture problems that we see in construction? Do we have the problems we have in construction in terms of culture? Because we were painted this way? Or are we painted this way? Because we have our cultural problems. And anyone who wants to jump in on that question is it’s from an outsider’s perspective. I’m curious about that. Because my construction career started when I started here at mobilization funding.

Natasha Sherwood 30:38

I think it starts with why is dirty, bad? Right. So why is getting dirty, bad? So, you know, I think that’s probably where you get it. And I don’t know which psychology match the chicken or the egg, which, you know, what is it but I think it is that assumption, and it goes back to working hard is not bad. Working dirty is not bad. And that just, you know, and, you know, wasn’t bad when you were a kid to get your hands dirty. Now we sent you know, Hannah ties everything. And heaven forbid, you know, you, you eat some dirt. So I think, in my opinion, it probably starts somehow that dirty is bad. And we associated hard work and being sweaty because, hey, that’s hard. I don’t know,

Matt Vetter 31:18

when it’s, I think it’s our language. It’s how we communicate. So we talk about things right? When I was in high school, voc tech is what we call it. Right? And you could do that. But it was the burnouts, right? It was the kids who were barely hanging on to a high school diploma by a thread that would go and do voc tech. And it was, you can go to college and have have the crown or you can be the burnout and have no options in life. It shouldn’t be pasted as an alternative, it should just be an option. Yes. Yes, I agree. But autumn to your point about culture. I’m going to push back a bit, I don’t think we have a cultural problem in construction. I think, I think the United States in general, as a culture has a problem recognizing that, I think that we have a very vibrant and healing culture that I see. I mean, certainly not in my company, but in in the general industry around us. I think the culture is there, I think people recognize that you can start as a laborer, you could dig a ditch today, but you can own the excavation company, and in 10 years and 15 years, and it, you know, I’m not trying to crap on the construction, or the excuse me, the college route at all, I just think it needs to be on an equal footing as an option, and not one better than the other. Because kids learn differently. Kids have different motivations. And we need to push that men that message to create the culture that we want in this industry.

Saleh Mubarak 32:48

Right. Right. Right. Yeah, I agree with Matt, that it should be an option. And there is a stigma, it’s much worse in other cultures outside the United States that if you don’t go to college, you, you’re doomed to be a low class and so on. So I think in Germany, they have the, the vocational route very well, you know, discipline, and people that are very well respected, and so on. And I mentioned to autumn in a previous conversation, that one of the things, the differences between experience and education is that in experience, you learn how to do it. But in education, you know, also why you do it this way. So for, for example, in reinforced concrete, and I’m, I’m a concrete kind of person, we put the rebar, sometimes in the slab, sometimes on the top, sometimes in the bottom. Why do we do that? You know, that when we explained that in education, but I want to go back to work quickly, to one point about following your passion. I’m a strong advocate of following my passion. And I have five kids, none of them is in engineer so I didn’t put any any pressure on them. Two of them are in the car industry. One works with BMW, the other one with Nissan, and one who might end the I end, my own son, my fourth son, who is crazy about sports, all sports, especially basketball. And now he got a job as a event manager, sports event manager, International Academy. So but at the same time, there is a problem with following your passion, that you get the tunnel vision. You don’t want to learn other supportive subjects, and you focus too much on a narrow niche that this is my passion. I do I want to learn anything about marketing computers, this, this this. And I think that college education gives you the rounded knowledge, which is really, really important. I’m sure that all of you guys probably listen to Steve Jobs commencement speech at Stanford University. And he mentioned how his those courses he took in graphic design came back. So this rounded knowledge, let’s say history took, you know, I had the issues with my older son, who is OCD. And who would ace some courses, take a and other courses flunk them, you know, he cannot be dumb. Otherwise, he would flunk everything. And he would question that why I’m studying this, why should I take a course in history. And I said, Son, it’s rounded knowledge, that rounded knowledge is good. If you sit in a, you know, with a bunch of guys discussing history, geography, politics, I think you should know a little bit about that. So that’s the problem with following your passion blindly. Without the rounded knowledge,

Scott Peper 36:12

you guys have all touched on something that I heard many say in our just collective individual conversations, whether I’ve talked to you folks or even just our clients. And it’s one thing that I draw attention to is the construction industry, I think is very unique in that if you think about the macro factors of the world that can help you or hurt you. It’s not if you get those big ones, right, you can lay it on a good path. And I think so often college you have to you’re forced to focus, we’ve talked about focusing or know what you want to do or get into the right spot. And then you have this stigma like healthcare as a doctor or nurse or construction as turning a wrench or dirty. And in reality construction, you can do anything in construction, if you start as turning to try to emit you hit the nail on the head, you could be an executive in finance, you can be a labor, you can be middle senior executive leadership and management, you can be a CEO, you can expand out of construction, if you get bored with one scope, and there’s 50 scopes to go into no building. In addition to that, no matter what is going on in the world, your things are going to be getting destroyed and things are going to be getting built, they’re going to be getting rebuilt, the world’s going to change and need new stuff. And all of it is construction. And one of the things I like to say is construction is really the heartbeat of America and a country anything anyone is doing today is directly tied to the construction world where we set what we do how we go about someone had to build it, someone had to create it and constructions attached to it. And so it’s this industry, and we thought about it like that. And you are any type of skill or any type of desire you want, you could if the message was only Hey, look at construction, you could fit it into the construction industry and all these different 50 different spots. And if you try to compare that to other industries, you might not be able to you get there, maybe there’s only 10 spots you could get into or 20. And if it was framed like that, I think we find a lot more people say, You know what, I’m just gonna go get in that industry. And I’ll figure out what I want to do in any way I can get in return a wrench or whatever, go to school first go school later. I don’t know if you any of you share the same thoughts, or have you heard other people frame it that way, or what’s your general,

Natasha Sherwood 38:32

we frame it that way a lot when we go into especially in schools, so we’re always, always promoting our apprenticeship programs. So the idea is after you know, after high school or even in high school, we’ll start you into the apprentice program. And the idea that once you get in even the electrical industry as a subsection of construction is there’s HR, there’s marketing, there are estimating, there has been specialist some guys are sitting there they you know, if you like playing virtual reality at home, you’d be great been specially you know, so you know, there is so many different routes. So we have even from a national level, and from our IC national organization, as we are out there trying to recruit apprentices is putting those different levels where they can be so in what form and a superintendent, you might be in the office, you might be doing the estimating, you might be doing the sales, you might do the marketing. It’s truly a microcosm of college, where you can do that, where you are dealing with people and when we share our office space with one of our contractors and I love going in there and chatting with him in the the cafe area, you could run into the sales guy talking to the low voltage guy, he’s talking to the cybersecurity guy. He’s talking to the estimating and everybody’s chatting about how when where they got to, but it is an industry that doesn’t doesn’t stop. When I was driving home from Tallahassee. I was frustrated yesterday on the road because there were a million semis in front of me, right, you know, they’re taking up the road and they’re slow and I was trying to get home and then I just stopped from him. I was like, you know, two years ago, we were praying for the roads to be back open, right? We wanted you know, trucks and trucks couldn’t move and half those trucks were filled with, you know, lumber and pipes and you know, and I was like, okay, so Ah, this is your industry, this is what’s building, okay, so I’m gonna slow down and enjoy the drive I didn’t have anywhere to be. But that’s the one thing that didn’t stop in as to your point won’t stop. I mean, we’re in Florida, you’re going to need air conditioning, it doesn’t matter if anything happens, your air conditioner has to work. You don’t you don’t know, no offense map, but you don’t call that, you know, mental health counselor, a psychologist or the psychiatrist, or the public relations person. The one thing that you cannot live without in Florida, is air conditioning. You know, you can, you know, we can live without, you know, hurricanes don’t scare us, unless we’re going to turn off our power, we have generators for air conditioning. You know, nothing else matters. And it’s so it is a industry and a career for all of those paths. So whether you do go in as an accounting degree or whatnot, it is it is a career that is long term, and you can move up in it. I mean, there are ways there are set paths, some places you get, you never know where the next step is. There’s some clear paths in construction on where you want to go if you want to. And some just apps, one of my greatest instructors doesn’t want to do anything he loves being in the field. That’s what he loves. Yeah. And I think we all need to realize that. That is what some people want to do be in the field, be outside, be working with your hands, and that is admirable. And that is honorable. And that is an amazing and lucrative with his ideas when I took about two Corvettes and a pickup truck later.

Matt Vetter 41:26

I think to follow up on soleus point about passion. You know, I think a lot of passion is kind of kind of bullshit. Excuse me, but I don’t think an 18 year old kid knows what passion is. I think you have to go out and experience life for 10 years, 20 years, maybe even longer. Before you really can even know what your what your passion is. And I think I did. I did too. I think the rounded learning that you mentioned, I think that’s that’s critical. I don’t know that it has I don’t think it has to be in college. I think you can get a rounded learning and education through numerous avenues. But I think that’s that’s critical to developing and even finding what our real passions are internally.

Saleh Mubarak 42:12

You’re right, Matt. In fact, in fact, I can take that in big corporations, big disciplined corporations. When a new employee a young employee comes in fresh from college, they rotate him or her on all the, you know, divisions. So they first of all, it’s for two purposes, one of them you should have a my long inch deep knowledge of everything. The second thing is that to find your passion, you find it only after you experience it, it’s not just and I’ll tell I’ll tell you the strangest thing about passion. I was a professor at Georgia Southern University in Statesboro, Georgia, in the 1990s, between 92 and 98. And one of my best students who wasn’t a student in the program was called construction management. In his third year, he came to me to sign that paper. He said, I’m changing my major. And I said to what he said to history, and I kind of jumped What are you changing from construction management to history? You gotta be crazy. He said, I love history and said, okay, so I signed the paper in the it was the ad dementia. That’s because it’s stuck.

Autumn Sullivan 43:35

Alright, our Chief Customer Officer, John Draco had recently had a post on LinkedIn about how he his college major was art history. And he’s like, No, I, I don’t necessarily use my art history in in what I do now. But I did. But I did learn a lot. And I did learn to learn, right like I it what it taught me was was a continuous love of learning and how to be a good learner. And I think that’s important. And to your point, Matt, I agree. I don’t think that that has to be done in a college setting. I brag all the time that my husband who has a high school diploma is one of the most well read individuals I’ve ever met he out reads me hands down. And, and is has an incredibly well rounded education because of it. But it all happened, you know, on his break in between installing commercial air conditioning systems, because that was his passion. His passion was reading and learning. I want to so we’ve got 15 minutes left. And one of the things I want to talk about is that higher education because I used to work in marketing agencies and I did a lot of marketing for colleges and universities. They spend an awful lot of money, marketing the idea that their education is the path to following your passion. and having two quarterbacks in a pickup truck, right? Like they tell a very effective story. And, and we don’t we construction as an industry does not spend a lot of money on marketing, and especially not on marketing for recruitment purposes. So my question to you guys is what could construction companies be doing that would help tell the story of the potential of our industry to those younger audiences? Natasha, I know you guys do a ton of work with with young, younger audiences, but but also like, what can the actual companies be doing to take control of that narrative?

Matt Vetter 45:40

I mean, get out and talk to these kids. Exactly what Natasha is doing exactly what we’re doing. We talked to local high schools constantly. We, we started a high school aged internship program this year, just to kind of give kids an opportunity to, you know, step into our world and just see what it looks like. And we give them the the flexibility that they can come in, they can pick which route they want to see, they can come and hang out with me and do estimates and talk about marketing and sales, I can put them in the field with my superintendent, and they can get dirty, you know, whichever area they can, they can run social media, you know, but, but I think that’s the critical nature of his because we don’t spend a lot of money on it. But we’re also fighting, you know, 3040 years of, of a mentality that we’re trying to shift, and the only way to do that is, you know, without blowing up the complete education system, the only way to do that is to reach these kids, early enough to give them the opportunity to make those decisions for themselves. And I think it’s just through talking, you know, we, we can only do so much,

Natasha Sherwood 46:46

hey, I think you should just blow up the education system, you know, like, you know, I’m on a mission,

Natasha Sherwood 46:53

there’s, then there’s a couple things that we’ve identified two that I think is important that we’ve talked about, and in a lot of it is we’ve done is making sure that our our teammates that are in the construction industry with us are proud of what they do and talk about it and don’t say, I’m just this, I’m just that, you know, because you’re not, it’s, it’s the same thing as I’m just a stay at home mom, or I’m just a project manager, I’m I’m I’m just an electrician, you know, those are a part of it is changing that. And part of it is and this I’m going to use my my master’s degree from it is being involved in the politics of the Liberal government of your chamber of commerce, politics, school board elections, and is making your voice heard. And that is one aspect that we do with our association is that we are we try to get behind those people that are not only for small business, and you know, for businesses in largest is making sure that as people that are understanding those options is we learned more than anything during this pandemic, that school boards are very powerful in what school stay open, and if they’re wearing masks or not. And if they’re enjoying school, and we are lucky here in Florida, that we are not experiencing a lot of what other places are but I think it is you know, being proud of what you are doing it is getting involved in the politics and it’s like Matt said it is getting in the schools however you can whatever toe you have to be in as you know, volunteering however, you you know, being involved in, you know, Pop Warner Football is that are around you’re talking to those kids, the junior achievements in your area, the great American teaching, whether it’s a great Florida teaching or not, I don’t know whatever it is, it is it is being in there and being proud of what you’re doing and sharing it is how that will be. That being said we’re also spending a crapload of money right now right now here and in sample on doing some billboards about built by you, that’s one of our new things we’re doing with HCC built by you and just really showing the images of what people are building and it is social media advertising. If I can figure out a tick tock for some construction electrician to do that we’ll be doing catch on I see behind that. And sometimes it may seem some of it maybe when we show them about a little bit silly or whatnot, but to grab that age group that we need to to fill, I’m sure it’s the same in construction, we have more electricians who retire every day than I can bring into the industry. So I have to grab their attention. I have to do it quickly. But they have to see people they want to be like and so that is that’s the part of putting it out there. So you know, if you’re not involved in your chamber or your local association, whether it’s ABC or IEC or whatever, you know, union it is in that area. Those are the areas I think that need to start to make those differences so that you do have those options.

Scott Peper 49:43

And go where they are is really what I’m hearing you say go where they are and their online, go online showcase the jobs. I mean, there’s some of the coolest stuff I see on LinkedIn or social media is a construction site and the video attached to it and what it looked like before and what it looks like Like after buy, you know and use the bulldozer analogy we’re talking about for two guys in a build, those are for five days can have the most some of the most impressive video from start to finish and a five day period than anything you possibly see on LinkedIn. And if all of a sudden you attach, like, here’s what these folks make to every single one of those, someone might say, You know what, that’s awesome. I thought, in accounting, I’m going to go in there and I’m going to make X and by the way, the correlation in those worlds, they have no idea if you put $1 sign of what the person is making an accounting after a four year degree. Next to their perception, I think, oh my gosh, this was so much more than what last and the perception of what they thought the person the bulldozers making, compared to what they were they are making, they might be like running towards that bulldozer. So I think the marketing aspect of just that alone would be so critical to helping shape some of the perspectives that people have just so it’s a fair perspective, just so someone’s not thinking the wrong thing. Yeah.

Saleh Mubarak 50:59

You call it a bit of marketing, and you know, it’s marketing slash education, that I think, you know, following your passion, requires you to know all the options. I mean, you may find somebody who likes certain type of food. This is my, you know, favorite food, have you tried other types of food? So I think you the trade schools that Matt talked about was was great. You know, I remember in college, we took trades, you know, welding and carpentry and so on. It’s a good thing when you have a root rotational system that you get exposed to everything. And after that you tell me, you know, which one you you fell in love with? Yeah,

Scott Peper 51:47

I had a mentor, tell me one, start listening to people, not the TV, you know, don’t listen to the government for the day, follow, find a person that you like someone that’s a human that you know their name. And like, you don’t have to know them. But you at least know it’s a person you’re listening to and not a day, or them or a government entity, or the state says or the CDC, like find the human at a place and not just the place. And I thought it was good perspective. And it’s really helped me a ton, many decades ago later. Yeah.

Autumn Sullivan 52:23

We have just a few minutes left. And we do have a question. Jeffrey asks, one thing I’ve always found missing from the trades is clear career path. Some unions do well at this, but the building industry in general has done poorly in explaining how a young person can go from labor to manager and defining that path. So who wants to respond to Jeffrey’s comment?

Natasha Sherwood 52:48

He’s spot on? Spot on? Yeah. And I think you know, that that’s literally what were my, like I said on our National Board for, for IEC. And that’s what we’re trying to delineate, and we’re trying to work out what is that path so that we can explain helper, apprentice, electrician, foreman, Superintendent, you know, project manager, what’s next and and then the salaries and dollars that go with it. And then some of them, then, you know, the, it’ll split out. And there is that is part of the education that we have not told them that you can spend four years in college and go be an accountant, and it’s been four or five years, and then you get to be a senior accountant, or you can spend four years as an apprentice working, you’re probably a good superintendent, by the time you get out of that apprentice program if you work for one company. And so we’ve done a poor job. And I think that is part of the marketing that has to be done is to show those and not just to the student, and not just to the employee that has to be shown to the guidance counselor, and the parent. I mean, let’s be you know, those parents want to say my kid went to XYZ college. That’s why you know, 70,000 people apply to Harvard, when they’re going to accept 3000, they just want to say, we know where they went. So it needs to be this is the path. But it’s interesting, because how many people really know the path of a CEO? You know, how did you how many people really know the path of an accountant, but because those came from college, somehow that gets to Trump that what is the plan, you know, for construction someone in the construction industry, but we do we have to take extra steps that we maybe didn’t before.

Autumn Sullivan 54:27

It’s interesting, because I’m thinking from, from a marketing standpoint, because I always am. That’s an easy, that’s an easy Tiktok to make, actually, to show a person you know, labor and what they make and then one year later and what they make and show that progression. I mean, that’s that’s an easy viral item

Natasha Sherwood 54:45

to find some good yet. Don’t ever vote to have that one post that went viral on LinkedIn. 1.6 million views. It’s the worst thing in your entire life to go viral because it beings all night on LinkedIn, bing, bing, bing, and if you You turn it off, and somebody disagrees with you, and you haven’t responded. So but yeah, so a via it would be an easy viral Instagram. But um, but it’s funny that that that post is exactly what we’re talking about essentially is normalizing the idea to the four year trade school is as good as a four year college. If I

Saleh Mubarak 55:17

can add one thing quickly here, in the path itself, there are paths, not just one, many people don’t understand that, that having a technical skills does not necessarily mean that you can run an organization that if you are a good in repair of HVAC, you mentioned HVAC, okay, you may be a brilliant technician, but a miserable manager. Those kinds of skills, some of them you’re born with, and some of them you have to polish those those skills. I know I have a brother in law, who now passed away, who was a great chef in in culinary school in he worked with the Disney Corporation, you know, he was brilliant. He tried to run his own business, and he failed miserably. So and some people are, by nature enterpreneurs they want to do their own business. Some of them are better stay as employ employees for the rest of their lives. So I don’t know how to put it, but you need to learn the skills required because before and be ready before you jump in.

Autumn Sullivan 56:34

That’s so true. That’s so true. One of our podcasts this season, we have a podcast called The real innovators. If you haven’t subscribed yet, please go subscribe after the end of this webinar. It’s available everywhere you get your pods, but one of our one of the episodes was with a business owner, Calvin Weathersby. And he talked about how he meets with his team and asks them what their what they want to accomplish. You know, where do you see yourself in three years, five years, and then he actually works with them to create their path? Because you’re right, when you walk into college, they’re like, Oh, you’re going for English? Well, then you want to be an English teacher, here are the courses you have to take. This is your path. But I went to college for English and I didn’t want to be an English teacher that sounded like hell on earth to me, I. And I’m pretty sure it’s like, I don’t want to do that. But no one said to me, you could get into marketing, or you could be an editor or you there was just one path. And it didn’t work for me. So we need to get better about showing that there are lots of paths, you know, to entrepreneurialism, to, to whatever it is you want to accomplish.

Natasha Sherwood 57:41

It’s not mutually exclusive. I mean, we talked about like, my students who are my apprentices are in college. So they’re taking RTI related technical instruction from us, they are doing four years at the college, they walk out with 32 to 46 college credits if they want to go take the next step. And we’re doing a horrible job of explaining that to it’s like a it’s like a community college scholarship. That it doesn’t mean that this is the end goes back kind of thing. It’s got to be any I’d have been a much better college student if I’ve done something else years. Yeah, before I got into college, even just

Scott Peper 58:26

On the next webinar, we’ll talk about having your phone or your face stuffed in your phone for eight hours a day isn’t going to help you either. From my parental conversations that I’m suffering through on my own children.

Autumn Sullivan 58:54

Well, that is our time for today. I can’t thank you all enough for taking time out of your busy days to join us for this conversation. It was hugely valuable for our audience and super entertaining to be a part of. So thank you.

Matt Vetter 59:09

Thanks for having us. I mean, this isn’t a conversation. This could have gone three hours.

Scott Peper 59:16

Review, if there’s anything that Autumn and I could do or through us that can help you in creating that meme that Tiktok a slide, anything that you could use with your network, let us know I’d love to be able to give that to you guys as our gift for you. If it’s a way of helping we different contacts we have if you said hey, it’d be great if I had a video that did this, this and this. And it was some cartoon and you could utilize it tasked us with doing that. You tell us how and we’ll do it. And I’d love to make that part of what you guys can push out from here to actually make it more than just a one hour conversation and actually turn into producible results. Absolutely.

Natasha Sherwood 1:00:00

If I may have to do that, that Tiktok does, like now it’s spinning my head. I’m like, we can just pop point, point point point. I’m like, I’m going through all the stupid dances in the stupid Instagrams eyes. Watch. I’m like, we have to be together auto email me.

Scott Peper 1:00:11

Yeah. Well, you will text us what it is. If I had this, I could do this much more than that. And we’ll do it. We’ll make it happen. Will you ask us we’ll figure it out and we’ll deliver it. What would be the thing that would help? Yep.

Autumn Sullivan 1:00:29

Thanks so much. All right. Thank you,

Scott Peper 1:00:33

everybody. Appreciate it. Take care.