Cash flow management is particularly critical for small and mid-size businesses, as these companies often have less free cash flow to help them cover unexpected costs, delays, work shortages, or their growth.
Before we talk about good cash flow management and share a few tips to improve cash flow at your business, let’s back up a bit. What is cash flow, and why is it so important?
What is Cash Flow?
If you’re not entirely sure what we mean when we say “cash flow,” don’t worry—you’re not alone. Cash flow is simply the money coming in and out of your business. A positive cash flow means you can pay all of your company’s overhead costs, debt payments, and other expenses, still have some money left over in the bank account and hopefully provide a buffer against any future issues or challenges. If you have positive cash flow, you can reinvest in your business, take advantage of growth opportunities, and weather financial downturns with less stress.
Cash flow comes in three forms: operating, investing, and financing. We’ll focus on operating cash flow, which is the money your business makes from selling goods or services. Basically, the money your company makes doing whatever it is your company does. Financial cash flow shows the money you use to fund your business, including debt, equity, and dividends. Investing cash flow is money created from investment opportunities.
How Does Cash Flow Management Affect My Business?
Here’s an easy question: Do you know how much cash you have in your business each and every day, what the expenses of the business are that week and how much cash you need in order to manage the week’s needs? If you answered NO to all or any part of that then this is especially for you! (Checking your bank account at any given moment to determine how much cash is there is NOT sufficient to give a Yes to this question.) A report given to you weekly or daily as the business owner is key to your cash flow management success.
Managing your cash flow sources and the consequent uses of that cash can literally make or break your business. A U.S. Bank study showed that 82 percent of small businesses fail because of poor cash flow management. We cannot over-emphasize the importance of being able to estimate, track, and forecast the money coming in and out of your business, especially if you are planning to grow.
Prolonged cash flow shortages can lead to insurmountable debt, while short but chronic shortages can lead to stricter payment terms with vendors and lenders, who know longer trust your ability to pay. It can also impact your company’s credit score, which means banks will be less likely to lend to you when you need funds to grow … or survive.
Cash Flow Management Tips for Small Businesses
Hire an accountant and likely a bookkeeper too. If this is the only thing you take away from this article, it would still be a valuable read. Hiring an accountant is THAT important to your business. Don’t rely on Quickbooks or your friend’s mother-in-law, unless she is a CPA. You need a trusted professional who can help you navigate your cash flow statements, ensure you maximize your cash flow, and help you craft your business growth strategy. If you are saying to yourself, “I can’t spend the money on an accountant or they are too expensive” then you either need a new accountant because the one you have is not helping you, or you are being penny wise and pound foolish.
Know your numbers. The first step toward better cash flow management is to know your numbers so you can perform a cash flow analysis. “Know your numbers” may sound cliché, but it is so critical to your success or failure. You have to know what costs you have in your business—the fixed costs (salaries, rent, debt service, insurance, vehicle payments, etc.) and the variable costs associated to your products or services.
If you use an accounting software—or even better, if you work with a CPA like we mentioned above—you should be able to get an accurate breakdown of your cash flow sources and uses in a cash flow statement.
We all go into business for a completely different reason than “know your numbers” but that does not mean we get to ignore them. If you do your business will most likely fail despite your best intentions.
Estimate, track, and forecast. By looking at a cash flow statement, you can see if you are accurately marking up your products or services to cover the overhead expenses of running your business. Here’s how you determine the accurate markup:
- Add the fixed cost of all recurring monthly expenses to get the total monthly cost. Multiply by 12 to get the Total Annual Expense of those fixed costs.
- Determine what the estimated Total Annual Revenues will be for the year.
- Divide the Total Annual Expenses by the Total Annual Revenues to get a percentage.
- That percentage is how much of each dollar you sell will need to go toward paying your fixed overhead expenses. If you add that percentage to every product, project, or bid you will break even and have no profit at the end of the year. What amount or percentage you add above that is what your profit will be.
The next step is to track your cash flow. This is especially true in businesses where costs can change. We specialize in working with construction and manufacturing companies, and their project costs can shift quickly and often. The same could be true for a restaurant, if the prices of ingredients suddenly skyrocket due to a shortage. Tracking your cash flow on a daily, weekly or monthly basis (depending on the nature of cash flow in your company) helps you stay ahead of any potential cash flow issues.
Download our free Cash Flow Tracker Tool.
Make sure to get the Cash Flow Tracker Instructions too.
Finally, when you have a history of cash flow tracking and analyses under your belt, you can start to forecast or predict your cash flow, which is the key to making an effective cash flow plan for growth. You now have the ability to run your business and make good decisions in the moment but also proactively. Decisions like when to buy new equipment, bulk order supplies when there is a good deal, take an owner’s distribution, hire a new employee, give bonuses, etc.
Have an emergency fund. Free cash flow is cash that you do not have to spend on overhead and that you could re-invest into the business. This is the ultimate indicator of financial health. Most accounting professionals recommend you keep three to six months of working capital in reserve. If this seems daunting, start small. Sit down with your cash flow analysis and determine what percentage of your cash can be saved. Then continue to save that percentage even as you grow.
Negotiate terms with suppliers. If you need something, you NEED to ASK for it. Remember that the customer/supplier relationship works both ways. You need their products; they need you to stay in business and keep paying them for product. If you need credit or extended payment terms, you need to ask for it. Get them invested in your success by sharing how the new terms will help you grow and order even more.
Get paid on time. The best way to avoid a cash flow shortage is to get paid when you expected to. In construction, the wait to get paid is often 60 days or more. One easy way to keep cash flowing in is to create a process around submitting invoices so that they are correct and on-time. It can also be helpful to setup reminder emails to clients if you have extended terms of payment.
Why Do I Need a Cash Flow Plan for Growth?
Growth phases are one of the most exciting but also most vulnerable times in a company’s life. Having a cash flow forecast built on solid cash flow tracking will help you determine how much extra you need in order to meet your growth goals. If you plan to grow by 25% next year, a cash flow plan will help you break down what that growth will do to your overhead and other expenses, and how much of your free cash flow can be utilized to cover the cost of growth.
There’s nothing wrong with taking out a loan to grow, but it should be part of a comprehensive financial plan that supports your growth without accumulating too much debt or the wrong kind of debt.
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Recommended Reading
Construction Management Solutions to Streamline Your Cash Flow
If there is one word Camell Williams wants you to get out of this episode, it is DISCIPLINE. Camell is the CEO & Founder of Prime Electrical Services, a commercial electrical contractor located in Apopka, Florida. He sat down with Scott to share his journey from student to contractor to business owner, and why he is still a student of the craft. If you are a construction business owner or a contractor who wants to be a business owner, Camell’s wisdom and stories can save you years of headaches. Camell believes in investing in his team, that business IS personal, and that the best thing you can do for your own success is be humble about what you do know and what you don’t.
Full Transcript Below
Scott Peper 0:38
Everybody. Good morning. Good afternoon. This is Scott peeper with mobilization funding. And I am really excited to bring our second Real MFer series to you guys, and one of my favorite guests. Today I’m going to share with you all his name is Camell Williams. He’s the president, co-founder of Prime Electrical Services Inc, out of Orlando, Florida, and has been a client of ours and become a good friend, and someone I really look up to and admire what he’s done in accomplishing his business. I’m really excited for him to be able to tell his story today. Camell. Welcome.
Camell Williams 1:11
Thank you, Scott. Appreciate the opportunity. How are you?
Scott Peper 1:13
Good. I’m very good. If you don’t mind, Camell, I think what would be good for everyone is to know just a little bit about you your background, how you landed in Florida, where you’re from, a little bit about just the general basis of Prime Electrical Services so folks can understand a little bit about your business, size wise people, etc, that we’ll dive into some questions and go from there. You know, we can tell lots of good stories.
Camell Williams 1:36
Okay, Scott, thanks. My initial visit to Florida was probably back in 83. 81. I’m sorry, I came down here to Florida Memorial University, I went to be what they have participate in HBCU. I just had to have that HBCU experience came out Florida Memorial. Went back to Detroit, late I’m originally from Detroit went back to Detroit. And I gotta tell you, that’s important to point out. The reason I left Detroit because I was determined not to work in the automotive industry. I came down here, got educated about my path and electrical industry and ended up back in Detroit, working in the automotive industry, but on a different level. I mean, I wasn’t on the line, I was working as an electrician there. And it was a great opportunity. I later came back down and I want to say 2006 decided to plant my roots here and started Prime Electrical Services in 2008. Great opportunity. work was growing, everyone said that time is important. I paid one cent of that time. And it was the worst possible time to start a business. This was 2008. But in my opinion, it seemed like the best time because no one was building anything new but everyone was repairing. Hence the name Prime Electrical Services I focused my business specifically on service work being and that was my niche to get back into the electrical industry and own my own company. From then I was in Lakeland, Florida back in 2008. I moved to Orlando and is where we are right now, in Apopka Florida.
Scott Peper 3:21
You mentioned that you definitively knew you didn’t want to be in the automotive industry. But did you know what industry you want to be in? And how did you ultimately decide on construction,
Camell Williams 3:29
You know what it was, I knew I wanted to be electrical as I told you before, my uncle was a master electrician and on weekends and on summer vacation. My mother I was one of those children that my mother say do something with them, take them out and get them out there. So he would take me out in the electrical industry. Now it’s important that I tell you this when I started construction first my father — my grandfather was a mason and he took me out one weekend and brought me back in and told my mother keep that boy and in school. Wait I don’t want him on my job. When my uncle came along and I found that in the electrical industry It was a chance for me to not only use my love for math and my hands on experience but but to build something and be able to turn the light switch on and see the after effects and then made a difference to me and that’s what I focused on. And I knew it was it would be electrical industry.
Scott Peper 4:26
It’s funny you get a lot of experience from your, the people you’re surrounded with the most all throughout life particularly younger, you know spending that time with your uncle, giving you the guidance and instructions. You know, what else did you learn from your uncle aside from just wanting to get into construction?
Camell Williams 4:41
He taught me to approach everything optimistically and to think about it again. My uncle was also an instructor electrical instructor. So we not only taught me to trade but he taught me how to think in a trade because that’s what we need is to I just needed someone to directly in between he and my father kept me thinking He taught me to understand the business. Because he wasn’t a, he wasn’t a business owner, he worked for another electrical contractor. In fact, he worked for one of the first black electrical contractors in Detroit. And that guy was phenomenal. So just being around him seeing him raise my level to know that that’s exactly what I want to do at some point.
Scott Peper 5:23
That’s really cool. One of the things I heard you said, I really want to point this out to the audience, I think is important. And you mentioned 2008. And everyone told you was the worst time and not the time to start, but you thought it was the best time. And I can hear in your voice and knowing you a little better, but especially now hearing you talk about your uncle, that positivity and wisdom and guidance, I think he instilled in you also helped you see opportunities and see the playing field differently than other folks that are even that even though they’re telling you this is terrible, don’t do it. This is the worst comedy, don’t start the business, you found a way not only to add value, but really drive a new business and create a culture around success. And I think I think it’s important to point that out to the people that are listening to this, if you didn’t hear that subtly. That’s the key is how your vision of it is not what everyone else’s vision of it as well.
Camell Williams 6:14
It was the long term visions, but I had, and trust me, it was a hard sell. Imagine telling my wife that, in the middle of this worst time, in a long time, I’m going to start my own business. But my focus was that this business 2008 is going to cause a lot of businesses to fail. I realized that, and the market will pick up in three to four years. And if I started right, then three to four years later, I’d have history. So now when I walked into a general contractor, and asked him to give me opportunity, I wasn’t just starting, when times were good. They can look back and say well, these guys have been in business for four or five years, he’s lasted this long, he made it through 2008 910. Granted, it was small, the smaller number I say small numbers, they were decent numbers. But compared to now, they were much smaller numbers. But I survived it. And I learned a lot. What I didn’t prepare for during those times was their banks were not loaning any money, there was very little capital available and nor was I in a position to to go after it. So the struggle was real. It was real. But the goal was to survive. You know, my, my uncle, as well as a guy I heard from several years later, made a statement to me. And they said, it’s not how well you perform your craft. But it’s how long you can withstand the politics of your industry. And I never forgot that. So I knew if I got into it, dug in deep and stayed there, and eventually reached some success.
Scott Peper 7:48
That’s excellent advice. Just Just keep going. Be consistent with your energy and your efforts and your strategy and make the adjustments when neat when you do and continue to evaluate and innovate. But keep going on work in your favor. You know, it’s a great segue into something else I want to talk to you about. And I think you’re really uniquely positioned to talk about this, from all the reasons just mentioned. But you know, construction is a tough, business overall. And electricity and electricians are even even a tougher portion, depending on different scopes. And I think you’ve done a good job with your folks, both instilling a culture and managing those attributes. Can you talk a little bit about how you do it, and how you manage that and how you help your employees?
Camell Williams 8:32
Yeah, my focus, I have one word in my company. And I always say discipline, stay focused and stay disciplined. Because you’re right, the electrical industry is is a tough industry, because we are not just required. When we look at blueprints, to understand the electrical side, we have to understand the AC side, the plumbing side, we need to read architectural drawings, we need the fire alarm joins, because all these things that tie into our system, you can take plumbing and plumbing as a standalone system HVAC a standalone system, electrical, we need to either put power on those flushable toilets or put power to HBCU. So my team has to have the discipline to not just look at the electrical drawings. But every drawing is sitting there. So I hold them to a higher standard. It’s not always easy, because some guys want to go in and put a switch in and trust me Scott, I have my share of guys who come in and say I’m a journeyman electrician, because I know I lie at my grandmother’s basement, and it works just fine. So I have to deal with that. And I have to always bring them back to discipline. You have to make sure you become student of your industry student of your craft. You know and you hear me talk thru this conversation. I’ll use two words, electrical and contracting. I talk about electrical and focusing on the industry itself. And you and my technicians like field, they have to be students out there, that they keep current with the technology because it’s changing, it evolves. So what I’ve focused is just keep learning, keep growing, and stay disciplined, and you’ll be a great electrician. And that’s been the secret to my success and maintaining adequate personnel in the field.
Scott Peper 10:20
You’ve now taken that discipline, you’ve you’re teaching to it, you’re educating to it, you’re building it into your safety programs. I happen to be in and out of your office and talking to you all the time. And I know what kind of systems and processes you have, and all that stuff isn’t an accident. But not everybody can instill those are no to know how to and if you were going to, if you were going to counsel, a newer entrepreneur, starting not only just a typical business, but any construction business, what guidance would you give him around how to take what you just talked about, but instilling that into your team.
Camell Williams 10:51
I always tell my guys, I got three As that I deal with attitude, ability and attendance. And if you have any tour boats, I can help you get the last one. So when I talk to my team, I try to stress that they find something that they love. And master this, kind of do what you like, want to run conduit, continue to run conduit, if it’s why you like. But know the industry, focus on what you really love. From the administration side, I tell them to constantly learn, constantly go to — I put all type of financial aid programs in place, I have several of my members have their master’s degree that we pay for I have several members of bachelor’s degree that we paid for, because I stress high on learning. Again, it’s all part of that discipline. Scott, I really believe that my goal should be to teach my team everything they need to leave me, but treat them well enough so that they want to stay. That’s the only way I can succeed.
Scott Peper 11:55
I mean, did everybody just hear what he said, and that is so powerful come out and you couldn’t want I couldn’t agree with you more. And I think discipline is how you started the conversation. But what you build on right there, and particularly the three A’s if you have attitude, ability, and attendance, any two of those, you can teach the third. And that’s those are core values that you really instilling in the fact that you focus on continued learning and higher learning. I mean, I just think that’s so important. I just want everybody here, listen to listening to this and really pick that up. That’s a key thing. How do you talk about how do you bring that into the day? You know, I know you didn’t just have one meeting and bring that up? How do you incorporate it, incorporate that daily, weekly, monthly with your team?
Camell Williams 12:36
I tell them when they when they walk in the door. And it’s real important, we try to teach my team to be independent thinkers. Because ultimately, in order for me to move my business to the next level, I need to be in a position where I can trust my employees to do exactly what they’re supposed to do without coming to me. So I try to explain to them and every time if you bring a problem to me, bring to me a potential solution. That means I’m forcing them to think of think about what needs to happen, and to utilize their skills and let them know that their opinions are very important. I don’t want them to appoint me make a decision. I have consistent meetings with them. I consistently try to guide them. But I tell them, if in doubt, if there’s any concern. And I don’t want to sound selfish when I say this, but I said there’s any concern with this building, there’s two things you need to remember it’s the decision you make going to make prime electrical money, or is it going to save prime electrical much, you have to fall into one of these categories, because ultimately, this is a for profit business. And the stronger the company gets, the more I can give to my team, the more I can help them grow, the more I can put into their education, the more I can put into that bonus structure. So as long as they continue to think, make decisions themselves and I keep reminding them that these are the key rules, save the company money and make the company money — it helps them grow. That’s how I do it on a daily basis.
Scott Peper 14:08
Awesome, man. I’m so glad you shared that is the key and focusing on the time you spend with them and making a quality time and empowering them. I think you’re gonna hit your goals. That’s why people do stay with you because they they want to, not because they have to or need to.
Camell Williams 14:24
Well and it’s difficult and in a small business. Some of the challenges got I don’t know if I’m getting ahead, but it’s important that I focus on some of the challenges we have in order to competitively keep your team an owner has to make sacrifices. Prime Electrical Services offers 401 k which is a barrier and we have a very aggressive matching program. We offer major medical, we offer health and wealth. I mean we offer a lot of things that small businesses typically shy away from because they just plain and simple can’t afford them. But in order to get the quality talent you need in order to give your people our home and Let your people know that you’re concerned about them and you care about them, you have to make the sacrifice. Now that means taking less home, what you’re building a team that’s going to stay with you. And that’s committed to growing with you because they understand your sacrifice. So it’s all necessary.
Scott Peper 15:18
I couldn’t agree with you more, let me transition a little bit with you. You’re a business owner, you’re an entrepreneur, you’ve fought the fights and struggles. You’re also an African American doing in this world. And I think there’s different challenges that are out there. Some are well known Some aren’t. And I think you navigate those so well doing it. And I’d like you to talk a little bit about what you feel are some of those challenges that you’ve had to overcome and how you’ve done it and how you’ve utilized your your own abilities and skills to survive and thrive. And what you would suggest other young, African American entrepreneurs what they can do or should do, or how they should think about that to get to a point where they can be successful and thrive with what’s out there available.
Camell Williams 15:58
If I had to sum that up, Scott, I would say, first of all, surround yourself with people smarter than you. It’s really important. As an African American, our biggest problem you can, I have to be transparent here, is we don’t have generations of running a business of doing this with first generation, or second generation. I talked about my grandfather being a mason, a brick mason, but he never dealt with the volume that we deal with here in today’s society numbers are, I mean, he never would have thought his grandson would be doing tech work that I deal with. So we don’t have a father or a grandfather someone to go to for our business needs. My uncle was able to teach me the trade but not the business at the learn that and that’s still surrounding myself with people smarter than me, that’s the first thing, find other African American businesses and have an open forum be in a position where you guys can regularly meet and talk. That’s the other side. Third, which is which is really important, is, I think, the most underrated positions in in business, then again, when you’re dealing with limited capital, you tend to not spend money on things you can’t see, things that you don’t realize you don’t think are important. And that’s accountants, you have to have a good accountant. And that’s, that’s invisible to most people. They buy QuickBooks, and they log on and they put in a few numbers, and it spits out the results. And they think they’re cons. And now you need a trained professional.
Scott Peper 17:33
Camell, you bring up your points that you talked about and surrounding yourself with smart people, talented people, different experiences, meeting and talking with others, finding your accountant in the CFO. And then of course providing capital, the one thing that’s in there that I think a lot of business owners, African American, white, Indian, I don’t think it matters any, I talked to all different types of business owners in this particular setting. It’s pride. And you know, you’re a prideful person, but you don’t let your pride get in the way of just straightforward, realistic conversations. I mean, just listen to what you just said just now. And I think getting out and surrounding yourself with smarter people. It shows your confidence level in yourself. Because you know what you know, you know what you don’t. How did you learn those things you provide it? Or how do you? Where did you get that from?
Camell Williams 18:31
Scott, I’ll tell you a lot of it was trial in there, I can say you might have heard me say this before, I probably couldn’t find anyone out here who has made as many mistakes as I’ve made. Because I went out and listen to the mass. I mean, I attended every outreach, every event, every small business seminar that I could go to. And what they would always tell me is, these are the things I needed to do in order to be successful. What they didn’t understand, and what’s most difficult is the people that were talking to me, were not business owners, they had never been business owners, they had never had to make payroll. So here’s what happens. And a small business, you start you have a good credit, you build your credit to that point. And you’re ready to go off on your own. Well, what happens as you go on business, the first thing you have to do everything that you buy, you have to sign for personal, which means multiple inquiries on your credit report, multiple inquiries, and every time you get an card, that credit goes down. So now you’re in a position where you got your new truck that you started for. And you had a great new car. You got your lease building that you signed for you got your accounts with all your vendors that you signed for. And your credit just went from 700 down to 580. Just because of inquiries you pay your bills on time, but now your cash flows. So at this point, you got to walk into a financial institution. Why do we think we got to go to SBA bank and they’re going to give us all the money we need because that’s what they said at the seminars. You walk in that bank, and that guy pulls your credit and says, You know what? You’re back from your balance sheet your credit, we’re not going to loan you money. And you, and at this point, it is too late. So what do you do? You answer that phone call. Someone said, Hey, we’ll loan you money right now today on your receivables, we will give you cash right now. And you take it and it starts a downward trend. All now you had good intentions when you started this. So that’s the cycle that small businesses, and primarily African American businesses, go through. So when I say you have to put your pride aside, you have to realize that business is very personal. And everyone says Nah, no, it’s not personal. It’s just business. No, business is what feeds your family. It’s what pays your mortgage, what pays for the car your wife drive, but it’s good as your children go to? Now you have to ask yourself is your pride worth sacrificing those things? When you realize it, you realize No, it’s not in my business, to me is very personal. So I have to put my pride aside and go in there and learn all I can learn, grow with these people follow their advice, my opinions matter when I get back in my office. But when I walk in their office, their opinions are only thing I need to focus on. That’s part of my growth. And I did it the other way it didn’t work.
Scott Peper 21:24
So you just said something that I think I really want to make sure everybody hears is tying those decisions and your pride and discipline to something that’s most important to you. And what’s more important really than family. When you when you link those two things, from a business perspective to those decisions you’re making are for your family, how are they going to impact your family, you’re going to make better decisions, you’re going to drop your pride. I think everyone listening to this, if you don’t take anything else from this call today, I think that might be the most powerful thing you said already. Because you’re going to make better decisions, when you’re thinking about it from your wife, your children, your other family members, you’re going to you’re going to you’re not going to let pride get in the way.
Camell Williams 22:04
And one other thing that it’s really important. It’s so intimidating, walking into financial institutions, because there’s no secrets, they don’t leave anything on the table they want to see are your pay stubs. You know what you paid what you spent on dinner last night, I mean, they turn, they turn to you. So it’s a lot easier to do that to someone, you can put a name to the face and who’s willing to talk to you and say I need this. Because this and I need this because of that. And it’s a little less intimidating when you do that. Just imagine buying a house 10 times over. That’s what it’s like when when they get a loan your money in it, and it can be exasperated, really can.
Scott Peper 22:45
You’ve talked a lot about really good topics. And I’ve tried to focus people on those specific things. But is there is there one thing that you believe really separates a contractor success or failure?
Camell Williams 22:58
Yes, knowing your business and mastering the ability to balance your business. There’s two ways that a contractor can fail. One is by under eating, or starvation. The other one is overeating. I mean, and those are the two ways and so you have to get a balance, you have to know when to say no to a job. When to move forward with the job, you have to truly understand your financial numbers, understand whether or not you can finance this job, whether your forecasting is correct. And you have and you have adequate forecasting. I mean, those are the things that I would tell any small business don’t just go and I’ve seen it happen 1000 times I got a $2 million job. And this is going to change the company. Well, maybe so but once you do your due diligence and realize that three months down the road, you’re going to be out of money, and someone else would be finishing this job. So I stressed it to everyone know your business and balance your business appropriately. Know when to say yes. And when to say no.
Scott Peper 24:06
It’s great advice. I’d add one thing to that too. I want to make sure people know that. I myself in this business. I don’t I’m not the person that is the best at finance and forecasts and understand a business. I have a fantastic partner and a CFO. That hands me those tools. And when I see them in a format. I know how to make those great decisions that way. But you don’t have to be the chef. You just have to know how to evaluate the plate at the end.
Camell Williams 24:33
Absolutely.
Scott Peper 24:35
I think what I want to make sure is the connection. You don’t need to go to accounting schools, you need to just find somebody that can give you the information you need in a simple easy format that you can make decisions off of.
Camell Wiliams 24:45
And follow their advice and listen to them. You know that that’s again, that’s what your pride as we put aside, you have to listen to them. You brought them there to give you the best advice and it means nothing if you don’t listen to it.
Scott Peper 25:00
Last question for you. Is there one thing you wish you knew if you go back to the very beginning, and think about anybody that’s out here now starting their business there one thing you wish you knew or you wish you were told that you hadn’t addressed today, or that you just want to highlight from something you’ve already talked about today. That’s the one thing you wish you knew in the beginning that you know, now, maybe we save somebody some years of headache.
Camell Williams 25:22
Man, I’ve had this conversation so many times, and I’ve talked to people and I would think that seriously when I walked into it, if I understood that being good at my craft, would not ensure success in me being a contractor. I wish someone had explained it to me, someone had said, because I felt so much you risk, I felt that I was the best electrician out there, which means I’m going to be a phenomenal contract. And for several years, I ran my head into this block wall thinking that my skill in the industry would make me a success in business. I wish someone had sat me down and told me no, please become a student of your business. As much as you are student of the craft, become a student of your business. Surround yourself with good people have no I’ve said that before, but I can’t repeat it enough. Surround yourself with people who know more than you take the time learn and grow but understand your business. And no one told me that I never knew it. I thought I can buy software that could do it all for it didn’t work. So I found out that do the hard way,
Scott Peper 26:35
I’m gonna leave it there. I don’t know if I could improve on that any better. And I just want to tell you again, thank you so much for taking the time, the effort, the energy to share your stories, your honesty, your discipline yourself and what you’re doing. I think we certainly help people today if, if there’s anyone out there that’s listening to this, they’re going to get least one or if not more things from this conversation we’ve had and your honesty and your ability to share it and talk through it. I know people are going to be better off and I just want to say thank you very much for doing that.
Camell Williams 27:08
Scott. It was my pleasure. Thank you very much for having me.
Scott Peper 27:10
Well, everyone, I hope you guys enjoyed this time. If you have any questions you need anything, you can always find this on our YouTube channel. You can always find this on our website. There’s tons of resources out there that are all free to you. You can download them you can get them there’s cash flow models, all kinds of stuff about business construction topics that we provide totally free to you just on our website on the resources page. So feel free to go there. Thank you again canal. I appreciate it. Everyone have a great afternoon, evening or day. Take care.
Transcribed by https://otter.ai
Right now, women make up about 9% of the construction workforce. There are huge opportunities for women in construction, either as part of the workforce or as a business owner, but there are also challenges that must be met.
In this episode of Built for Growth, Sartura Shuman-Smith, Director of Tampa Bay Works for Women at The Helen Gordon Davis Centre for Women, and Robyn Donaldson, owner of Renew Construction Services, and Founder of the STEM Xposure Inc., join Mobilization Funding CEO Scott Peper for a discussion on the challenges and opportunities for women in construction, and what companies can do to encourage women to join the industry.
Full Transcript Below
Scott Peper 0:42 Hi everybody, welcome. I’m Scott Peper, CEO of Mobilization Funding. I’m really excited to talk today about women in construction and I have two awesome women. Very strong, powerful women, in my view, here to talk a little bit today. First is our Sartura Schumann-Smith. She’s the director of the Tampa Bay Works for Women at the Helen Gordon Davis Centre for Women, and Robyn Donaldson, owner of Renew Construction Services and founder of STEM Exposure Inc program, which exposes high school students to different STEM and architectural design programs. Welcome, ladies.
Sartura Shuman-Smith 1:17 Thank you.
Robyn Donaldson 1:20 Hi, thank you for having me.
Scott Peper 1:20 Welcome. I want to thank you guys so much for taking the time to do this with us. We always are looking for interesting and exciting topics. Today, I really feel like not only am I going to learn a lot, that I usually do from this, but I think it’s going to touch on areas that we’re just so not familiar with and in doing some of the research on both of you and the things that you guys have done being the fact that this is in our local community, to and you guys are all of us are in the Tampa Bay area. It’s nice that we’re gonna be able to see things and find out and things that I didn’t know existed really, I mean, I’ve known about different programs, but to see what you guys are doing and how you’re doing them and how they can impact our local area is really important to me, so I’m excited about that.
Robyn Donaldson 1:57 Awesome.
Sartura Shuman-Smith 1:58 I am too.
Scott Peper 1:59 Robyn, let me ask you a question, to start with you. You have different companies, you know, community real estate developer and you’ve had lots of volunteer work. Tell us a little bit about your journey, where you’re from how you decided to focus on the architecture and construction space. And mostly, maybe just round that through your whole career. How did you get into this?
Robyn Donaldson 2:22 Oh, well, let’s see I’ve always been interested in construction. I think it was to, to spite my mom because she always wanted me to go into the nursing field. So, while in high school, I went to Tampa Bay vocational tech, and I took up industrial electricity, just to make her mad, and I fell in love with construction. I just absolutely loved it. I’m a problem solver. So, it was just at the time an ideal fit. Upon graduating In 1987, I don’t want to say that too loud, I graduated from high school, I had a certification as an apprentice, and I worked for TC Hernandez Electric, Tampa Tribune, doing electrical maintenance, until I had an accident where my hand was caught in the machine. And I’m like, you know what, I have to stop doing all the laborer’s work. Let me get into a, let’s say the administrative side of things. I reached out to a great friend of mine, who’s a general contractor, and she just really exposed me to all of the different facets of construction. And let me say this, she’s my mentor. She’s the first African American to receive a General Contractor’s license in the state of Florida. And her name is Anne McNeil from MCO Construction in South Florida. She’s an awesome, awesome person. And again, she exposed me to the different trades, different aspects of construction. Whether it was aviation, transportation, and she just really gave me my start, she helped direct my footsteps. And I found myself in architectural design. Again, I’m a problem solver. I love to design things; I love to develop. And as a result, from that I took classes at HCC, I received my, my certification for architectural design. And then there was the building component. And it all just made sense. I just absolutely love involving, I say myself with hands, and then really just creating things. So that’s the gist of how I got into the construction side of things. But with all of the different business that I have, they all revolve around construction.
Scott Peper 4:49 Cool. Thank you for sharing that. And Sartura, you run the Tampa Bay Works for Women program and its construction-focused program of Women Building Futures. Could you tell us a little bit more about yourself, how you got into that what your thoughts are around your program, how you got to start it and where it’s heading and how you got into it yourself?
Sartura Shuman-Smith 5:07 Sure. Well, I’m, Robyn, I didn’t do anything in spite of (laughs)—so I, my start is right here in Tampa. I’m a Tampa native. So that’s a rarity in itself. I always wanted to be a school teacher and I guess you’re saying that how does that work into construction or careers, but I always wanted to be a school teacher and when the college, did that, taught school for a while, and ended up in nonprofit, decided that well, I don’t not sure if I really want to do this anymore. But I ended up in nonprofit my first nonprofit job was with Tampa Housing Authority. And then I went from there to PBS Television where stayed for a very long time. I would really date myself, but I don’t mind. I stayed there almost 21 years in children’s programming, education and in children’s programming. And when the recession hit in ‘08, everything fell apart. Um, my job went away. And so, it was like, Okay, all right, let me try to reinvent myself like everybody was doing then. But I ended up staying in a nonprofit sector and started doing contract work with different agencies. And someone referred me to the Centre for Women and said that, you know, you might want to check them out. So, they reached out to me and I went over and started doing outreach. And then a position came open as the director of one of the Center for women’s program called the Center for Girls. And I just was adamant in my heart, I didn’t vocalize it during the interview was like, oh my god, do not do this anymore. I tried to run away from children. Try my best. I love them though. And they really are my passion. So, I said, Well, okay, I’ll take the interim director’s position. So interim for me is like 30 days. I set you up, I get you straight. And then I’m out of here. Well, that interim position turned into six years. So, I’ve been with the Centre for Women for six years and in December this past December 2019. After a lot of prayer, a lot of self-reflection, I decided I wanted to do something different. It wasn’t that I want did not want to work with children anymore. I just felt that I had already made I had made a strong enough impact that I could light someone else’s torch, not passing the torch, because when you pass the torch, you give up your light. So, I wanted to light the torch of someone else to take that position. And actually, that’s where Robyn and I met through the Center for Girls. So, I came over into career development our Tampa Bay Works for Women program. I didn’t know that our Women Building Futures program was a part of that. So here I am, knew nothing about career development. I knew nothing about the construction field, but like Robyn, I am, I want to say I problem solver. I’m a fixer, I want to try new things. I want to see how much of an impact I can make somewhere else. And maybe we’ll get into that later. So, I’ll save that response for another question. But this is where I am, and this is what I’m doing.
Scott Peper 8:23 Well, I’m looking forward to getting into that topic next and make sure that we remember I guide you back there if I don’t. You know, one question I want to ask you guys, I thought it would be interesting to start with, before I dive into some of the other topics is you guys have met a lot of people in and around construction, both at a young age, in the middle of the prime of their career, and it sounds like even towards the end of their careers. Can you give us maybe one or two traits or talents that you see are the real separators between people that make it and are successful in the construction or the people that just kind of get into construction and are just stay there and don’t leave to either develop their company or make it all the way through their career? And the reason I ask the question that way is we see so many folks in construction that sounds such a hard field and people come and go in and out of it. Businesses fail and succeed. Maybe a little bit different pace than other industries. I think a lot of construction gets a bad rap. But yet, there’s really some amazing talent that’s in construction, mostly because it is such a hard field innately in my opinion to succeed at. There’s so many more dynamics, there’s way more challenges whether they’re cash flow problems, people, labor or material but the sheer dollars of a project, and I really want to see what is it in your guy’s opinion from your perspective that makes someone more successful or less successful? What are those traits that you see?
Sartura Shuman-Smith 9:46 I’m going to, Robyn I’m going to definitely toss this off to you after I say my little piece. Before we started, I put a disclaimer out there Robyn is the expert and I’m still learning but I’m going to compare my background to where I am now. So, I’m going to use the comparison with what I’m doing. I remember when I left the school system, I honestly thought that there was nothing I could do but teach, you know, what else can I do? And when I got an opportunity to go interview at the TV station, I’m saying to myself, what in the heck am I gonna do at a television station, but that’s because I didn’t know anything about television or production or media. But when I got there, I started out in sales, working in sales, and then moved into education and outreach and children’s programming. So for me, I think a trait that leads to someone’s success, and I think in any area Robyn can expound on it, when it comes to construction—I think just thinking out of the box, thinking outside of the box that okay, I don’t have to stay in a classroom to educate. I don’t have to stay here just to do this or I don’t have to just be a welder, or I don’t have to just be in business. Masonry, I don’t have to just be and I think when people understand the areas that they’re in and really do soul searching and realize their own potential, and when they get into an area, it’s like, you know what, because I tell people all the time when I talk to them, you know, you don’t have to do just, and I’m putting that in quotes because it’s not a just feel, but you don’t have to just focus on that one area that you know, broaden your horizons, educate yourself, and be bold enough to say, hey, Scott, I’d like to learn this side of the construction business. What you all do Scott at your company, like oh, okay, alrighty, so this is something different in that whole big area of construction.
Robyn Donaldson 11:47 I’m taking notes.
Scott Peper 11:50 Robyn, what do you think?
Robyn Donaldson 11:52 Really, it boils down to what time do you wake up in the morning? I wake up at three o’clock. I think that that would be definitely a trait of a successful business owner is the sacrifices and the time that you’re willing to dedicate to your ultimate goal or your ultimate business. Also, who they associate themselves with, I always recommend being a part of a mastermind group. Associate with people who are on the same journey or someone who has already achieved the type of success that you’re looking for. And also, feed your mind. Feed your mind always improving yourself, whether it’s in your speech, your skill set, whatever it is always be. In that learning, I’m always in a learning type of mode. And I’m, also more importantly, just really know what you want to say that you want to be a business owner. Again, those are just words. Now you need Have a plan, and it needs to be written. And I also think that having an accountability partner, which is in part also associated with the mastermind group, just having someone who can hold you accountable for what you’re saying that you’re wanting to do, I think those three things really are key in the success of an entrepreneur or starting or and running your own business. One thing that I did want to mention your subconscious mind, your mindset, the way that you think the way that you’re approaching things. And I know sometimes it’s, it’s a little roadblock because if you’ve been an employee for so long, you know that if you work 40 hours, you have a paycheck on Friday. But the mindset of an entrepreneur is so different. You have to literally make it happen every day. Like there’s no days off. And again, those things I think combined is what separates successful entrepreneurs from those who are just talking about it.
Sartura Shuman-Smith 13:58 You’re right, I agree with you Robyn on that one. It’s the mindset It really is got it and I didn’t want to interrupt you but you really have to decide and make up that mind of yours to say this is what I’m going to do and attach yourself to people who are sincere about helping you to achieve that goal not don’t attach yourself to someone who you just think is this great one because of their reputation, or their name or their association but attach yourself to someone who really has no other reason but to support you and to guide you and bring you to the next level.
Scott Peper 14:37 You know you guys are really speaking my language now I’m glad this question is on air because my team internally and certainly Autumn for sure, I understand this, but you know, you guys, I couldn’t agree with you more. One mindset is everything talking about what you are going to do not what you’re going to try to do is we talked about all the time. One of our core values is be a lifetime learner. If you’re not educating your mind every single day, somehow advancing yourself, you’re going to get left behind. Things I personally believe, finding a mastermind, finding a group who you surround yourself with, there’s people I follow and really listen to. And one of the things that’s come out of my mastermind group I think is relevant to the to two things really, that are relevant to what you guys said. One is, when you look at your inner circle, who you’re surrounding yourself with the people, you’re closest to the five, so people you spend the most amount of time with, you’re going to be some version of those five people. And the other thing I learned, which is a little more harsh, but I think very relevant, they were said to me, You have to figure out what type of hard you want to participate in. What that means is life is all hard. You know, being broke is hard. Working hard is hard. Getting up at three in the morning is hard, you know, getting up at eight in the morning, getting sleep and then not getting anything done, which leads to you having extra work at night is hard. And you really just have to figure out what hard you want to participate in. Right Oh, Nothing’s easy. There’s no such thing. And when I heard that the first time, I made me think you know what? Yeah, there’s a right you got to take time and pause with your family and do fun things. But you got to get back to it too. You know and know how hard you work smartly with goals with a plan with a group that’s helping us you’re not just run around like a crazy person activity and calling yourself hard work. That is the key. So, I mean, I really think you guys touched on some really important key topics. And I’m glad we touched on that because you’re right, it is all mindset.
Sartura Shuman-Smith 16:32 Hey, can I add one more thing, Scott and Robyn, no word, but oh my gosh, please. And I know it’s easier said than done. And we probably do it ourselves. But I try to make a conscious effort to not say that you just don’t know how many people I’ve talked to. Now that were remote on the phone, who they immediately start telling me what they want to do. And before I can say, Okay, well let me before I can say I’m trying to help them but this but that but it is and I tell them okay, I’ve given you five times to say it now stop. You’ve just talked yourself completely out of everything that you just said you wanted to do everything that you said you wanted to do you say that there was a but there. I said you have to eliminate that but and because all you can get is either a yes or no so but is not even going to hurt. If you say I really want to do this Scott, but we’ll just ask Scott. Or Robyn I really would like to go into architecture but. All right, we’re gonna say is what? But I can’t say but I don’t have the experience. But Scott, I don’t know anything about finance. I that word but has to go.
Scott Peper 17:47 The only time you can use the word but is when you respond to someone with, look all those excuses sound really good, but I just don’t care. I just want you to be able to get it done and so do you like mom taught me when, when I was learning how to apologize, which I still working on. But anytime you say I’m sorry, but you just negate the entire column. Right? If you say if you’re gonna use the word, but just realize just Mazal just skip everything you just said it’s not worth anything. And I realized, you know, I like talking and not having it mean anything. So, I mostly just eliminate that word from my vocabulary.
Robyn Donaldson 18:25 No, but.
Scott Peper 18:26 We’ll change gears on you guys. You know, currently the in the construction workforce, women make up just over 9% of it, at least according to the US construction workforce. Anyway, from your guys experience, what are some of the challenges that you think women face specifically as they’re entering into the construction industry?
Sartura Shuman-Smith 18:42 Robyn, I’m always jumping first because I know my two cents will lead into your 10 cents, because that I know this much. But one of the things I feel is that and I’m quite sure Robyn will agree with is there’s not enough women in actual leave to shift positions. So, they’re not enough. I mean, there’s some powerful women because I’ve encountered some of them. Robyn is one of them that are doing their own thing and are successful. But I don’t think that there’s enough women in leadership positions to make those decisions to bring a more diverse group to an organization or construction firm. I think lack of Robyn spoke of her mentor right off the gate. I don’t think there’s enough mentorship and opportunities or apprenticeships. And women are not visible enough in the industry, that you may hear about an Ann McNeil or a Mercedes Young or a Robyn Donaldson but not everybody has the opportunity to actually be able to engage with those people or those individuals. So, I don’t think there’s enough visibility with women and construction. The other issue is the pay gap. And I’m quite sure we’ll maybe go into that later. But there’s still for me, I believe with everything now and it has. And I don’t really think this has anything to do with the current climate, I just still think there’s a lot of unconscious bias. When it comes to women. Being in a male dominated industry, like construction, people will look at someone and immediately say, Oh, you don’t look like you’re in construction. You know, right off the bat. Oh, you don’t look like you know, well, what does that look like? You know, what does that woman in construction look like? Because I remember one time I went somewhere, and I heard somebody used the term drive by images. And for me drive by images of what you see literally when you’re either driving by walking by, whether that’s on media, so you have these perceptions and ideas and notions of what a construction worker looks like. But people don’t realize, well, the construction industry is massive, and they’re all types of Like Robyn, architectural design and electrical, this and all of these big things, and I just don’t think there’s enough of that in our faces. So, I think for me, those are some of the issues that I think women are facing in the industry.
Scott Peper 21:15 You know, according to the National Association of Women in construction, the pay gap, one of the things you mentioned, it looks like about 5% 90, women earn about 95% of what men are in the same field. And although that’s five percent, a lot, it’s actually a lot higher in construction or closer aligning construction than it actually is in other industries, which I found interesting. I wouldn’t have guessed that or known that to be accurate. I wouldn’t have thought I was actually worse candidly than the other industries. Robyn, I’m interested to hear your opinion. What why do you what do you think of those items? Why do you think it’s closer to the pay gap? But also, why do you Why do you think what do you think keeps more women from getting into the construction field?
Robyn Donaldson 21:55 Okay, so let me set the scene for you, right. You go to school for four years. As you achieve a degree, you want to enter into the construction field, whether it’s as a project manager, estimator, or even a designer, but then you’re paid considerably less than your counterparts. And then in some instances, you have to deal with different types of abuse, just because you are a female in a male dominated industry. So that’s an employee side, and wanting to change that you want to become, let’s just say a business owner or that entrepreneur. So now I think that is twice as hard. Because now you’re literally competing with the big boys as they would say, and they really don’t want you in their arena. Like I’ve so many times I have my How can I say my experience has been questioned because I’m a female. And so, it’s just they don’t they don’t see you the same and in my experience, you know, I have had wonderful, wonderful relationships with amazing women like Trail Blazers like Anne MacNeil. And then being a part of the organization called NABWIC, which is the National Association of Black Women in Construction. The women are out there is just the opportunities. And then the exposure. You don’t you don’t readily see that in the construction field. And then you have the situation where you can become a certified minority in the construction industry, but again, is all of these roadblocks that you encounter. So, it is a little difficult. It is not for the weak. I mean, you have to have some, you have to have some really tough skin because you’re going to have opposition that’s above and beyond a 40-hour week.
Scott Peper 23:50 One of the things I think you touched on I, I talk a lot about I think the greatest things in life come from a place of uncomfortability. You know When you get outside the lines, I call nothing, nothing great happens in the middle, it’s all on the edges. You know, if you’re going to get something that that other people aren’t going to have, you’re going to be outside the normal bounds working hard, either working hard, focusing on something that no one’s seen before. And what I like a lot from a sales background, I used to sell things in the medical field into hospitals, the accounts I’d walk into that I could sell the same day, I certainly liked and enjoyed, but I also knew that they could be taken away from me in the same day too. It was the things that had the extra hurdle or that much harder or the conversation or the person that I had to break through or resonate with or build a relationship with. That made it that much harder. I knew it was gonna stick. And so, I analogize that a little bit to what you just mentioned, as hard as it is to get those certifications. There’s such tremendous opportunity there that I think if there’s a way to educate women, minorities or even men that are trying to be in this field, figure out a way to really take advantage of that hard because if you can crack through it, there’s so much opportunity. It’s like you get through the hard part. And then there’s, there’s a lot of there’s some easy there. How do you see people navigating through that, particularly if they can see the other side? That’s what’s hard. Sometimes you see this huge wall in front of you. But you don’t realize the other side might be a green pasture.
Sartura Shuman-Smith 25:22 I heard somebody say the other day—and Robyn, you can write this down—I know your note taker. I heard this the other day, and I loved it. It said you can’t climb a smooth mountain. Right. And that just resonated with me. So, I literally visualize this slick mountain. And so, you’re right. You cannot climb a smooth mountain. You know, there has to be something for you to grab on to hold on to get your bearings in your foot footing. And as much as we don’t want to say things are hard or we want things to be smooth sailing. It’s not going to be that. And I used to do a lot of on when I was at the television station I used to I used to do a lot of trainings and workshops and presentations and for me, the person who had the biggest scowl on their face, the person who looked like they were writing their grocery list down instead of listening to me. That is the person I decided I was going to gravitate to. I’m going to stand by you. I’m going to place my hand on your shoulder. I’m going to look at your name tag, and I’m going to call you out and you’re just going to become my best friend before the end of this presentation. It’s like, that’s the challenge. It’s like, you’re going to like me, Robyn, and I’m looking at your name tag, Scott, oh, you’re going to like what I have to say. But it’s that not giving up and not seeing that, that one, that one detour sign or that one roadblock sign and decide that you’re going to turn around? You know, that that is like, you know, I tell people all the time, why would I go 50 miles to turn around and go back another 50 miles and go back to where I started from. We’ll just keep on pressing and go the remainder of the distance which may be shorter than from where I came from. So that’s just my little bit of knowledge and wisdom.
Robyn Donaldson 27:11 Oh my gosh, she’s so special. Um, I just really, she I love her though. You have to love Sartura.
Robyn Donaldson 27:18 Reiterating what you mentioned before, Scott, that you just have to decide what hard you want to play, or how hard you want to play actually, because a 40 hour week is hard, you know? So, but you’re building someone else’s empires, someone else’s dream, dedicate those same 40 hours to know what you have going on your business goal. And then also, I had just wanted to mention that I think is very imperative again, to have a mentor or someone to assist you with your journey because again, it’s very, very hard. You’re going to have rejection at every angle. And I’ll say whether it’s to contractors, whether it’s insurance, because there’s a lot that goes into being an entrepreneur, so you may have the best business plan the finances in order, but there’s always something that’s going to throw you for a loop. And just be ready for that. And then when you do see, when things like that do take place, you keep going and you find strength to just keep going through whatever you’re going through because again, is part of the process. And, and again, I just love that you have to choose your heart, because now you’re taking hard and impossible or difficult out of the equation, you’re going into this knowing that you’re going to have problems is just deciding how you’re going to deal with them when they occur. You know, I wrote that one down. I like that one too. I like that one too. Just choose your options. You can choose how hard you want to go, you know with diversity in the certifications, again, that was a way that I had to strategize myself or maneuver through the construction industry. When you have a certification, they have to let you play, so to speak, they have to let you in the playground. Now whether they let you own a screening or even give you a push, it’s something totally different. But I mean, you have to start there. And there’s going to be so many. And I have to just keep saying this, because there’s going to be so many failures, there’s going to be so many obstacles. But once you pass that first obstacle, and you gain some momentum is just, it’s just really part of the process. Because I expect people to tell me no, the first second or third times, you know, I expect those things. So, it’s just maintaining the momentum despite any type of mishaps that may occur.
Scott Peper 29:52 You’ve mentioned mastermind and mentors and I think, you know, a lot of that is talked about, but can you do you have any that you recommend or how would it feel As someone said, you know what I really do need a mastermind I need to surround myself with the most important five people are going to help guide me. And then they say, where do I go find them? Do you have any suggestions or folks that you would recommend or people that you think are good masterminds or places to find those masterminds so that they can make that make a good decision there and then be guided in the right direction?
Robyn Donaldson 30:21 Yes. And that’s a great question. There’s so many, really depending on your industry, or even your interest. I know I started out with Meetup.com, which everyone knows whatever your interest is, you can just sign in, put in your zip code and your interest, and it’ll direct you to groups that have that same interest. And they meet all the time. So again, now you’re connecting with people who have the same interest. And then from that there’s a lot of mastermind, you can google mastermind, there’s construction mastermind groups linked has a lot of them. So, I would get really specific as to what area or industry that you’re looking for. And just find I would go on LinkedIn of Facebook has lots of them. I know the one that my mentor, every Saturday morning is called the International Mastermind Association. And that’s a guided mastermind because we use Napoleon Hills Think and Grow Rich book. And I’ve been involved with that mastermind group for some years. And we literally reread Think and Grow Rich over and over and over again. Of course, the words are the same, but we’re different every time we read it. I think I’ve read that book maybe like 17 times now. Wow. And each time I learned something different because I’m different. And again, networking, of find people who, again, you would like to be like and find someone Who can add value to what you have going on? And not, we don’t deal in the negatives or any subtractions. And then, and or you can create your own mastermind group. So as of late, of course, I’m into the STEM side of things. And I’ve just associated myself with a lot of tiny home builders, you know, anything, any, wherever my interest is, I’m going to find the best of the best person to pour into me. And, again, I hope I answer that question. But yeah, you can Google or IMA. There are so many different mastermind groups out there some that are free, then you have some mastermind groups that have a membership, that’s very costly. But just keep it in mind who’s going to be in that room, who you’re going to have the opportunity to listen, converse with. So, it just really depends on how deep you really want to go with it.
Scott Peper 33:00 Yeah. One thing I want to what you said that I think is really important when you go on this journey, it’s so easy to think what am I going to get? Let me evaluate all these What am I going to receive? But if you really start with this the mindset of what am I going to give? First, what is my contribution going to be to going, your mind changes and you will bring and attract to you and this is my belief, you will bring an attract to you the things that you need people who will see that if you think first about what you’re going to give and what you’re going to do and what you’re going to put forth. Everything else will show up for you if your mind is looking right where you want to go.
Robyn Donaldson 33:40 You know, that’s my tagline. I make a living from given.
Robyn Donaldson 33:45 And if you find how you can add value, whatever it is that you’re in search of, it’ll come back and I think that that has been my whole experience with STEM Exposure which is the non for profit summer camps. I just simply, I’m in service to others. That’s how I feel. I don’t ever approach anyone asking for anything. I asked them, how can I be a value to you?
Scott Peper 34:16 And that’s it. You know, you mentioned your stem exposure. That is one of the things I really want to talk about next is a great segue into that, that for what if anyone doesn’t know STEM is something that really exposes these students to these different types of career paths and where it’s at, but can you tell us more about your particular STEM Exposure Inc program, how it helps the students what it exposes them to, and just the program in general?
Robyn Donaldson 34:41 Well, you know, I’m smiling because I love talking about my kids. I love the kids. A stem exposure, as you mentioned, is a nonprofit organization and our mission is to expose minority students to underrepresented STEM careers. Architectural and design camp is our signature camp. It’s all about revolving around providing affordable housing options. So, our camp started back in 2018. I had an investor asked me to design some conceptual drawings to help revitalize East Tampa. So, I said, You know what, let’s get these kids to decide what they want their neighborhood to look like. And as a result, we started a summer camp. It’s a two-week camp, which we again expose kids to architectural design, development and the construction trades. And what happens after that second week is nothing but beautiful. So, the first camp we had was in 2018, and as a result of two students designs were selected and those houses were built in East Campus. So, we have students designing and building homes to revitalize East Tampa 2019 it was just a really overwhelming response to the channel. And what we, how can I say, to the camp of the impact that we had on the children and the fact that students ranging from third through 10th grade. Again, they’re actually learning how to design a home and then building it. And then so from 2019, we had the opportunity to have the camp at the glacier Children’s Museum in downtown Tampa, which was an awesome opportunity because it created the perfect atmosphere, you know, for STEM, the stem camp, of course, 2020 came up and we had six camps have scheduled but then COVID-19 hit, however not but however, birth to a virtual camp, online presence. And so since we again, we were featuring affordable housing for homeless veterans, we ventured off into the Tiny Homes and then When you think of Tiny Homes, who do you think of other than that different from Netflix, Tiny Home nation or operation tiny house. So what? I reached out to him, and he was our guest speaker, along with HGTV DIY. We had Schooley. We had all of the tiny home community, they just really poured into the students the first week, by talking to them about their design. They showed them the exterior and interior of their tiny home, which really just helped influence the students designs. And it was just really awesome. We have students from last year that really advanced toward architectural design. We brought those students in as instructors. So, we have students instructing students, which created a marvelous, wonderful, sustainable learning environment. We were also able to give students out for those instructors 1000 Dollar scholarships. And then 25 students’ participants, they received a $50 stifling. And that was from June the 15th through the 26th. And again, it was such an overwhelming response from the community. Zach says, Robyn, we have to do something with this. And so, August the 14th, through this past Friday, we had a global camp. We did a 2020 Tiny Home global virtual camp. This was a camp that we put together in the matter of a week and a half. And it was by far our best camp, because we had students all over the world participate. So, we had students from Philly, Argentina, Finland, and India. And also, we had a course we needed more instructors. So again, we reached out to the tiny home nation because they use SketchUp every day and they designed to Tiny Homes every day. So, Zach, he got on his IG. And he just announced it and we had a portion of instructors just volunteering. We had an instructor from India. It’s 5am. In the morning, we’re instructed but you know, she was still there. Then we reached out to SketchUp because we’re using their software. They became a sponsor. They gave all of our kids a free license, student pro version license.
Robyn Donaldson 39:28 I mean, it’s just like, I like it. Like he was just saying, once you just put something out there, the universe responds. And it was everything that we needed. It was given or answered in the way of in the inbox of email. We needed someone to assist with the flyers. We needed someone to assist with the website, and volunteers, volunteers, and I could sit here and tell you all about the case. But that’s the design side of it. On this summer, we were able to expose 120 students to architectural design and the construction trades. And they ranged from first grade to 12th grade. That’s awesome. Yes. And all virtual in is a two-week program. And the beautiful thing about the program is because of what it offers. First of all, it offers options to these students, because we feel that third grade is a crucial time for students, as well as the sixth grade, which is where they choose their electives. So, we can reach these kids early on and give them some options. Now they can choose you know, their electives accordingly. Again, like I said, that’s the design side. The building component of that is that we’re wanting to build these Tiny Homes for these homeless veterans and I reached out to her are wonderful, the city of Tampa and there’s some lots that are allocated It Well, we can actually build these tiny homes and to help with acquiring those lots. There’s a campaign that we’re kicking off September the first. And Scott, you can really help us out with this win by spreading the word is a global ask in this called Give a Buck for housing. So, we’re asking everyone, all 8 million people who lived in, in the world, we’re just asking them to donate $1. And that would be to acquire the property and the building for a homeless village for our veterans here in Tampa, Florida. And it’s just, um, I think is a wonderful concept because all lives matter. And we’re encompassing so many, many lives, because again, we’re exposing the students more importantly, we’re letting them know that all things are possible. All things are possible, and then we’re guiding them and then also We’re looking at the veterans who has, I can tell you about the veterans and then how important this is for them to have a home. And for these students to be able to design and to build. We have a lot of businesses, our sponsors who have just jumped on board to help me you know, make it a reality. So, that’s really STEM Exposure in a nutshell.
Scott Peper 42:27 I think that’s really awesome. I could see that being very successful.
Sartura Shuman-Smith 42:31 Let me jump in and something else you can
Robyn Donaldson 42:32 Alright, come on, jump in. Let’s do this. You know, when we’re mastermind and right now, you know that right? We’re mastermind, this is what we do.
Sartura Shuman-Smith All right. everything you just said is amazing, amazing. And so, once these little ones grow up and become women, we can enroll them and the Women Building Futures initiative at the Center for Women. So, if I have an opportunity I can want to just share about that program as well. Robyn is actually if—when we start, I won’t say if. When we are able to start the program of women building futures is our construction initiative for women. And it’s a 16-week program and women learn various areas of construction from carpentry, drywalling, electrical, even the administrative side of construction. And after that 16 weeks they receive a NCCER certification as well as the OSHA 10 certification. Um, the program is amazing and has been in just a viable part of our community for the past, I want to say five years. Well, before I came into that position, and actually garnered national attention from the today’s show, at the end of 2019, the program had been fully funded, but the funding went away. And so that’s been our biggest struggle is how we’re going to get these women in a program that was once free and now it’s going to have to have a cost associated if we do not get support or funders or sponsors. So, I think Robyn was actually one of the contract facilitators for the program. And it’s amazing how what during this pandemic, of course, I get calls on a daily basis about people looking for jobs or looking for career development, but at least five calls a week are for the women building futures program. And we talked about how just opportunities I had a call from a woman last week, who’s actually a teacher, she teaches Language Arts in Italy, but because of COVID, she can’t go back to Italy. So, she said during this downtime, I would love to learn construction. And I see you have the women building futures program. And I said well, because of COVID. You know, we are not able to do this face to face, the location that we had been doing. It is not back open yet. That’s HCC. But we have currently two positions available. So, I’m putting that plug out there. We have two positions right now for two crew members with our construction services program, and if somebody wants to email me, I’m going to say really quickly, it’s my first initial S. And my last name Smith s.smith, at the centre, thecentre.org. Email me and I will refer your information over to our HR program, but we’re looking for two people to work in construction to be a part of the crew. And this woman as I called her back, as I know, you want to downtown right now and I know you wanted to take the class, but would you be willing to apply for the position? What better way to learn, then right there doing that? So, we have people in the program? I think Robyn can attest to this. We’ve had people who were in the program previously, who graduated, get their certification and start have their own construction businesses, or their own handy woman, businesses. Actually, the person who is my go-to for everything here at this house was an employee of the Center for Women in the senior Home Improvement ship construction services, and also participated in the women building futures classes. So, there’s so many opportunities out there to support the efforts that everybody’s out there dealing to. And I just think it’s amazing, amazing what you’re doing with the kids it is I mean, having worked with kids pretty much all my life, it’s just amazing that they’re being given the opportunities to think out of the box to explore other opportunities and to know that they’re, they don’t have to just be you know, whatever it is they might have thought they want it to be or how they can expand or broaden that. So, working with kids working with women and nontraditional job setting is just amazing, because like I said, at least five calls a week are women who Want to build into construction? So, just want to plug that in there real quick.
Scott Peper 47:05 Um, you guys have been so gracious with your time I just realized we’ve talked now almost an hour already. And I just want to make sure before we let you guys go, is there anything else that you guys want to touch on or talk about or that we missed that? I don’t want anyone to not get from you guys while we’re here, at least this first call, maybe hopefully we can do this again. As new things come out and we keep rolling down the road.
Sartura Shuman-Smith 47:27 I Oh, I’m sorry, Robyn. I had a couple of notes that were we talking about women going into non-traditional jobs or young people wanting to go into STEM. And just having those mentors I just think being able to, I think everything starts within the company. I know we talked earlier about what does one do to get someone to see them. But I think it starts within the company, get your company to understand that there are women that there are young people who may want to go into this field, so make it available to them. Change your marketing, you know, when you see billboards or signage, you know make sure you have a diverse marketing plan or, or advertisement in your fliers. net. Provide networking opportunities, like Robyn said with meetup, provide networking opportunities for people to, you know, meet a Scott or Autumn or Robyn Donaldson or Sartura. Make those opportunities available and just educate. You know, the education has to start within the organization. If, you know contractors or construction firms want to hire women, to educate the people that are with you, so that they can speak the language and when I say speak the language when they go out and start talking about what’s going on at their companies or what they’re looking for, or who they’re looking to hire. They can know that well. Yes, no, we are hiring women. We are hiring young graduates, you know high school graduates who want an apprenticeship So, um, and again, you know, research, you know, people should research that’s how out and found me by researching women in construction and found out about our women building futures program and then found out about the Center for Women. So it’s just, you know, getting the word out and working together. I think collaboration is the greatest.
Robyn Donaldson 49:22 Well, there’s three things that I always say is a formula for success, right? So, number one, is to know what you know. Number two, know someone who knows what you don’t know. And number three, that’s all you need to know. And that is going out to all of the women who want to start a business may not know exactly what direction to take. Just know what you know. And do not worry about what you don’t know. Because that’s a big roadblock. And a lot of women becoming successful they feel that they don’t have all that is needed. And in order to do so, however, you just simply find someone who knows what you don’t know. And nine times out of 10 that should be a person of your mastermind group. And, again, just associating yourself with like-minded people. As far as the kids are concerned, and STEM Exposure, spread the message, spread the word and what we’re trying to do with these students, because it’s a game changer. I was speaking with, her name is Teresa Welch at the Boys and Girls Club. And she says, Robyn, you’re doing something that there hasn’t been a school can do. I was like, Okay, what is that? What does that she said you’re able to teach a student 1st through 12th grade, a software that they have never used before in a two week period, and then they can turn around and make money that next day which is really what the program does. And because, I mean, we’re using the program for architectural design. But these kids have an opportunity to use a software where they can create anything. Knowing that all things have a beginning, you can learn how to design. So again, it’s just really exposing these kids to different options. And again, letting people know what it is that we’re doing. So we can impact more people. The whole mission is, of course, to expose but also to revitalize communities. And we can do that by the participation and the assistance that we get from our sponsors. So just sharing the word and I’ll get back with you on that given up for housing. But that definitely, we want that to definitely happen so we can house some homeless veterans.
Scott Peper 51:50 I gotta thank you guys so much. I’ve really learned a lot, I hope and I think most of our audience will too. And I just really want to thank you guys again for taking the time and for what you do. Both of you are very generous. Just with your time and your efforts and your energy, and I can see why your organizations are and will be successful even further. And anything we can do myself personally and our team will definitely help you do for sure.
Sartura Shuman-Smith 52:10 Thank you. Thank you for having us.
Robyn Donaldson 52:14 Yes. Thank you so much for having us.
Scott Peper 53:00 You’re welcome, everybody. I hope you guys enjoyed this. Thank you very much, sir. Thank you, Robyn. And as always, Autumn I appreciate your help on this too. And everyone, have a great day. We look forward to seeing you again next time.
Transcribed by https://otter.ai
What is a bid bond?
A bid bond guarantees compensation to the owner should the subcontractor fail to perform the work at the original bid price.
Why does the owner need a guarantee for performance and price? Every project has a budget and a timeline. Most owners have other stakeholders in the project to whom they are accountable, so there is a real need to stay within the budget and on schedule. A subcontractor who suddenly refuses to do the work or refuses to do it at the original price is a big problem for the owner, so they safeguard against it with a bid bond.
Bid bonds are common in government or municipality jobs, since they have budgeted specific taxpayer dollars to perform a certain project. They need to know when they put out a bid that the subcontractors awarded the work will stay within budget and can perform the work.
How does a bid bond work?
What happens if the subcontractor doesn’t perform the work, or says they can’t perform the work at the originally bid price? The owner can then go to the subcontractor’s bond agency. The bid bond typically covers the difference between the lowest and second lowest bid, and this amount is paid by the bonding company to the owner. The bonding company may sue the contractor, depending on the bond’s terms, to recover the costs. The agency may also seek to install a new contractor at the original bid price or lower.
Recommended Reading
Cash flow can make or break the success of your project. Mapping out a project’s cash flow on a week-by-week schedule allows you to see the gaps and solve for them in advance. Getting it right starts by getting your bid right. Establishing the costs of your project, and the cost of running your business, is critical to estimating your bid. Finally, when you have the cash flow of every project estimated and scheduled, you have a solid foundation on which to build your business’s profitability.
CEO Scott Peper and Senior Commercial Underwriter Andrew Schwartz joined Michael Williams of Levelset for a complete crash course on setting up your cash flow to get the work done AND make a profit.
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The difference between margin and markup, and how much you’re REALLY making
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How to accurately estimate your company and project overhead for a smarter bid
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Why properly mapped out weekly cash flow will save you from penalties and conflict
You can also access the video and a full transcript on Levelset’s website.
Recommended Reading
How do you determine whether a candidate will be a good fit in your company? Many hiring managers base the decision on skills and experience alone. What these managers do not seem to realize is that a good culture fit is equally, if not even more important. Hiring with your culture in mind can improve your new talent outcome, increase retention, build greater camaraderie among your team, and even increase productivity.
Why Culture Matters
Whether you have intentionally built your company’s culture or not, your workplace has a culture. Even a toxic culture is, in fact, a culture. It is the personality of your organization, and it greatly affects how your team performs. A negative culture has serious business consequences, including greater risk of workplace accidents. Employees are also more likely to leave a negative workplace culture when a new opportunity presents itself, and if word gets out about your culture it becomes harder to hire new employees.
Hiring a bad culture fit can have serious implications to your company’s productivity and employee morale. Companies are like any other community — they function on a network of agreements, compromises, and shared goals. When someone enters the organization and starts to make waves, it disrupts everyone on the boat. Processes start to fall apart,
A Good Culture Fit Should Be Part of Your Hiring Strategy
Increasing employee retention, decreasing employee turnover, increasing productivity, and cutting recruiting expenses are all good reasons to make “culture” part of your hiring strategy. How do you hire for culture? The first exercise is to understand your own culture so you can find a good match.
Once you know who your company really is, you can seek out candidates with similar values, work philosophies and personality traits. If you are a team of collaborators, put “likes to collaborate” in your job posting requirements. If your company isn’t great at communicating directions, be honest that you value “independence and self-direction.” If your company’s work environment is filled with stress, conflict, and aggression … maybe work on that before you hire someone new.
Improving Your Culture to Improve Recruitment
If talking about your company’s culture makes you cringe, there’s good news — you can change your company’s culture! And we mean YOU, specifically. Culture needs to be embodied and modeled from the top of the organization, so the change starts with you.
Define your company’s values.
What do you stand for? How do you want your company to be thought of among your peers, partners, and the larger community? You must first define the values that are true to you as a business leader, then implement those values throughout your organization.
Bring your team into the fold.
Culture cannot be mandated; it must be grown. That means sharing your vision and values with your team and listening to their feedback. Encourage an open dialogue of where your company is now in terms of culture, where you want to be, and ideas of how to get there.
Intentionally changing your culture may lead to a few uncomfortable moments — be prepared for it and remember the goal is worth the effort. If you are modeling the core values every day, your team will start to follow your lead. And if one or two of your employees don’t, it may be time to let them find a place where they are a better culture fit.
Set culture expectations early.
Make your vision and values part of your hiring strategy and on-boarding materials. Discuss your expectations with potential new hires and check in with them often during their first few weeks to make sure they are experiencing the values first-hand from the rest of your team.
Charles Covey, President of Alphapex, a waterproofing company based out of Austin Texas, says new recruits get introduced to the core values immediately. “They are in the on-boarding paperwork. They have to read them, they have to understand what they mean, and they have to agree to uphold them.”
Recognize employees who live your values.
Employee recognition doesn’t have to be complicated or expensive. A verbal “that’s the way we do it!” from leadership can mean more to an employee than a formal Employee of the Month certificate. It’s all about authentic recognition and feedback. Encourage your employees to recognize and reward each other when they are upholding the company values and promoting a more positive work culture.
Reflect and refocus often.
Everyone in construction wears a lot of hats and taking time away from securing new work and managing projects to focus on something “soft” like culture might feel like a waste of time. It is not. As soon as you stop prioritizing culture, it starts to slip. You have to work at culture every day. Make it part of every team meeting, every business decision, and every new hire.
Focusing on your culture, and hiring good culture fits, will improve your reputation among your candidate pool, build employee loyalty and increase retention, and create a workplace people are genuinely proud to be a part of.
In THE REAL MF’ERS, Mobilization Funding CEO Scott Peper sits down with leaders from construction, manufacturing, and related service providers to see how they built their business, what they are doing differently, and why it works.
This is part 2 of our first episode. Scott interviews Founder and President of Alphapex, Charles Covey. They talk about everything — growing your construction business, core values, marketing, unicorns, and Whack-a-mole.
Full Transcript Below
Scott Peper 0:33 Okay, we’re back. I originally planned to have Charles with me just for maybe a half hour, 45 minutes, but we got into such a good conversation. We broke this into two separate parts. So I’m really excited to get us back here to keep going and continue this conversation. So without further ado, we’ll keep it rolling from here. One of the other key things that you have talked about a lot with me before is the systems that you’ve implemented and processes And how those have helped you really scale not only your team, but your internal and external capabilities, your customer experience, how you interact with your clients. Can you talk a little bit about some of those systems where you got how you put them in place, how they help you and what they what they do for you what they have done for you.
Charles Covey 1:18 I think systems are hypercritical in scaling a business. You can run a small business, and you can do a few hundred thousand or a million bucks a year and you can run it all out of your brain. But you’re not going to grow that much because you become the weak link. And I’ve done it, I’ve done it anyway go, how come I can’t grow this business? What’s going on? Oh, wait a minute. I’m the weakest link. And I think in construction we get, it’s kind of like the snowball starts rolling down the hill. And we’re just kind of going down this hill and things pick up momentum and you start getting clients and you start doing work and the work keeps coming in. And you’re going so fast and the speed that we have to operate in this problem and this problem and this problem and this problem is just I like to call it Whack a mole. You ever play that game, you know, take the kids cheese or whatever and you got to just so you’re just whacking but really What makes a big difference as an owner or as a manager, or as somebody that has a place to control what’s going on, is to slow down a little bit.
If you let it construction will drive you 100 miles an hour for the rest of time, you’re never going to get caught up. So you have to make that pause happen, you have to create that pause, sit back, look at your business from 30,000 feet, or look at your department that you manage from 30,000 feet and say, hey, what can I do to extend my abilities as a manager or as an owner? What can I do to extend my team’s abilities? And I think something that construction is really known for. And this may be, I think this section on systems is probably going to be the most critical. It’s a little bit boring at times, but it’s probably the most critical for your listener if they really want to make some money. And so I hope they’re paying attention because this is this is what’s been really impactful for us. So you think about construction, and know the systems are oftentimes just lacking. We’re running down that hill, so fast and the momentum is going. And so we’re just playing this Whack a mole. And just trying to get to the next thing and by the time you solve the next problem, boom, the other one’s already popped up, and boom, then the next one, and we’re just trying to just try to get to the next day. You ever felt like that, Scott?
You know, just trying to get rid of the shit from today so I can go home, kick back for 20 minutes, and then get tomorrow morning and do that shit again. And in construction because we’re gonna step back a little bit, look at those problems from a higher level and find out how we can extend the team’s abilities. So from what we found, that slowing down a little bit is super hard to do, and super valuable. So you’re thinking, Oh, well, you know, I need to be out on the jobsite. I need to be managing I need to be doing these things. You might actually need to just be still from it. You might just need to sit in your office with no noise and no phone and think about where you want to go. And what things in your business you’ve been avoiding. I’m guilty of this. What’s that big problem that’s in the room and you’ve been pushing. I’m real busy so I can just deal with it later. Well, then you look up and it’s two or three or six years later, and somebody else they handled that problem, they kicked your ass.
But we’ve got to take those problems, we got to tackle them head on. So I think system creation is really critical because you want to be able to step back as an owner. I’m not trying to grind this out taking 100 phone calls a day, playing Whack a mole for the next 40 years, are you? Hell no.
Scott Peper 4:17 No, no.
Charles Covey 04:19 But we see people do it. I know guys that are 70 years old. They’re doing everything exactly the same as they did when they were 30. And they’ve made some money and they’ve done okay. But are they at a peaceful and comfortable state in their life? No, but they could have been. And I think systems are a big part of that.
So you have to step back, you have to map out how your business works. And you’ve got to find a way to create processes so that things don’t get lost, and I digressed a minute there, I want to go back to a point. That construction has been in this rut, I call it hiring unicorns.
As you look at a lot of businesses and how they operate. You look at the, you know, the field ops manager or you look at you know, that head estimator, maybe the project executive that runs a whole team. Maybe the president in a bigger organization, they’re a unicorn. They’re a 1% guy, they’re very special in the way that their brain works. They can handle more shit than most people, you know. And the business hinges on them. And constructions really bad about this, or that foreman that really good for me. He just wants to be a foreman. That’s great, he does an awesome job. And, you know, that big project can’t run without it. That’ as big deal. What if he’s out for a week? What if something happens? Heaven forbid he has an accident and you don’t have a system to accommodate information. And now your unicorn leaves and everything crumbles. So construction has got to really wake up about hiring the unicorns. You can’t scale hiring 1%. There’s not that many 1% guys, that’s how percentage works.
So you’ve got to be able to hire and you’ve got to be able to put in place good people that identify with the core values — hard workers — can’t give up on that. But you can’t hire the 1% guy for every position. You got to be able to hire, maybe maybe, they’re in the 80% or the 70% or the 60% into the population, that they can follow the things that you do. And they can work really hard and identify with those values. So you’ve got to build a system so that that person can function just as well in the business, you know, the 60% person, the 80% person, as the 1% person. And I think that’s what systems really do. They allow you to scale.
And yes, you’ve got to have good people. But it doesn’t have to be that one unicorn. It’s so hard to find. And you do see this guy, do you see this in the businesses that you deal with? The one unicorn or the six unicorns? Maybe they’re at the top end of a company, everything comes to them, and if there’s a problem with them, it’s a shift.
Scott Peper 6:38 Yes, we see that all the time. One of the other things systems do for you and process is it allows the one percenters, it allows them to scale their department. Those one percenters and one thing that one percenters have in common is you need to grow because they’re going to want to do something different. And they’re going to want to grow and hire and teach and train and do the things and you need those systems and processes to help them do what you needed to do.
And on top of that, one of the things we’ve always talked about, you know, you kind of hit the nail on the head is getting on top of your business instead of in your business. And one of the things we hear a lot of our business owners tell us as they’ve grown from maybe 1 million to three or four or 5 million, and they become essentially a unicorn running around doing everything, and it’s they’re barely holding on and having everything in their head. And this is the key, one of the thing they say to us is, you know, I’m getting the same paycheck right now that I had when I was a $1 million company as I am when I’m a $5 million company.
Charles Covey 7:33 Yep.
Scott Peper 7:38 And so if you’re listening to this, and you hear this, and that’s You, go back to listen to the systems and processes piece again, because the systems and the process are the difference between you having the same paycheck with 100 times more stress as you grow your business or actually eliminating some of that stress. While you’re actually able to have more than just a single paycheck. Same as you did when you’re making when you’re only a million dollar company.
Charles Covey 7:58 People ask me a lot Well, why don’t you start with the system. You know your business better anybody, you know, the person at the top, I would assume, in most cases knows a little bit about each department and how it runs. You’ve got to think about how the information flows and you can’t allow there to be a disconnect in the flow.
Think about how construction goes. Okay, so we’ve got, you know, got Sally in Accounts Payable, and you know, she just gets those invoices that come in, and she just knows that on Thursdays, you know, usually on Thursdays, she just takes that stack of paper over and she gets them approved. She just knows that; she’s been doing it for 10 years, so she knows. But what if she forgets, and now you got all those suppliers that don’t get paid. Or what if you had to hire somebody else, and that new person — well, they don’t know because they haven’t been doing it for 15 years. So you’ve got to have a process.
Things like lists, things like flowcharts, things that connect the dots so that people can get this information comes in, then it goes to here. And then this person checks off and goes to here, and then it goes to here. It does this thing, the checks approve. It’s that level of detail. It gets stamped and it gets sent out. You’ve got to have things delineated and defined so that you can manage them so that you can train people for them. If you’re growing, you don’t need just one Sally in Accounts Payable, you need three, because your business is going to do 100 million dollars. And how do you scale that? How do you take all that information and document it? So systems really are just documenting, and then monitoring and managing all of those different things that happen in your company, and contracting and subcontracting. There’s a lot of stuff going on, when you start breaking down the processes. Oh, my gosh, there’s hundreds of steps to some of these things. Now they happen.
Scott Peper 9:35 And it’s the kind of work that nobody wants to do. I mean, I don’t, you don’t want to do it. It’s terrible. It’s the most … it’s not fun. It doesn’t feel rewarding when you’re doing it. There’s a great book for those of you that want more information that’s in a tactical guide executing this and it’s called the E-myth Revisited, by a guy named Michael Gerber. It’s an excellent book. It talks all about systems and processes and scaling. It’s very relatable. It’s not boring. It’s actually a great storytelling book on how it goes from chapter to chapter. It’s really, really excellent, well done. I highly recommend reading that for those of you as a quick sidebar that want to get some more detailed tactical info on systems and processes, we could probably have 6, 40 minute conversations about that and not give you nearly as much as in that book.
Charles Covey 10:22 Can I give you an example a story about one particular system that’s massive for us?
Scott Peper 10:24 Yeah, absolutely. Please.
Charles Covey 10:26 Okay. And this is a this was an issue I saw. I worked at a GC, they do, I think they did 600 million last year, good size operation. And they didn’t have a good system for pay apps. Didn’t have one. It was just up to the project manager to make sure they didn’t miss anything. It wasn’t documented. Nobody was checking on it. If something got missed, like literally, if they didn’t turn in an owner pay app. There was no check and balance to make sure that happened. And we see it really, really see it in subcontracting. I mean, it’s just, it’s a shit show.
And we’re, we’re built to do a lot of projects, a lot of volume. And as we continue to grow the size, the average size of those jobs keeps getting bigger. But we’re built to do a lot of volume. And to do that you have to manage the information. So and you know this really well pay apps and getting all that billing done in a month, they like 20th, 15th to 25th, depending on what the job requires, you know, that timeframe, those, you know, 7 to 10 days of the month. The business hinges on that shit, you cannot screw that up. And we’re doing I think we might do 40 pay apps a month or something. And there’s a lot of parts and pieces that go with those. And so we were saying, though, at first, we created a list to make sure that every pay app got done, make sure they got done on the date. Do you know a random GC has a pay app due on the fifth? That’s kind of an oddball. But if you do it on the 25th, guess what? You’re screwed. It’s getting pushed to the next fifth. And you just missed 30 days with the cash flow, big problem. So that happens two or three times and you’re like, wow, this is not something we can continue.
So we make a list of all the jobs that are active and that way we check off. You know what happens we can, you can do an Excel, you can do it. We do web-based systems, we use Monday.com because it’s it you do on your phone on your computer, it’s cloud based, so everybody can see the information. It’s very modular. So you can make a list, talk to another list. Monday, comm is really next level phenomenal for us. But the basic idea is you create a list of every pay app that has to be done. And every and then then, you know, as that pay gets done, how much the amount was for what the retainage is, and then that flows to the bottom line. Now you know exactly what your billing was for the month.
Well, the other part was, you know, projects were not getting predicted correctly as to what was available to build during the month. And so you just get to the 20th. And okay, well, this is how much we did. So in the past, that was not a proactive manner of managing the money in the cash flow. And so we started doing — we use the same list. So the list, it’s got the pay apps. Now that gets an analysis on the first of the month of what work is ahead of us for the next 30 days. What are we going to do? We’re going to do this percentage of this and we’re going to have this many feet of this and you just go down each Job, we’re going to hit this mini percentage, we’re going to this percentage. And then we know on the first, by the, by the third, I know on the third what my billing is going to be on the 30th. So from a cash flow standpoint, now I get another extra 30 days to know what the hell’s going on. And I can work with that.
Also, from a field management standpoint. Now our team knows, okay, we got these to do, oh, well, we’re going to be a little bit short. Because we start dividing these up. And we know on the first that about the middle of the month, we’re going to have kind of a flood of stuff to do. We need to accommodate that we just bought a couple of extra weeks, we’re not going to get that that pissed off Superintendent asking us why we’re there, or we’re not there because we already predicted this. So that that whole predictive, proactive nature of that system that really allows us to move quickly.
Scott Peper 13:42 That’s key. I mean, without getting those payoffs on doing them correctly on time, not missing things, being proactive. I mean, in a world where you’re paid once a month, and you only have the ability to invoice once a mom, if you mess it up, it’s catastrophic.
Charles Covey 13:57 Absolutely, it could be. Yeah, I remember early the early days of the business …. I don’t come from any money. My dad’s a firefighter. My mom’s a nurse. Like, we did not have any advantages. Alicia, my wife and I, we do this together. And we started this from zero, and almost went broke a few times, as we were working through things in cash flow. And that’s, that’s the deal. The first two or three years of the business, cash flow was the deal. That was what could have made or broken us a few times in a row. And I think we’re at a point now where we’re able to have facilities in place to manage that but you’ve got to manage the money coming in and coming out and a system really is the way to go. So anybody has questions, I’m here. If you, if you want to do, we could, you and I could probably do another call or a webinar, actually, on subcontracting systems. I think they’re probably pretty helpful for your for your listeners.
Scott Peper 14:45 You know, I’ll take you up on that because that would be helpful, very helpful. If we did just a webinar purely on systems and particularly around pay apps that would be extremely valuable.
Charles Covey 14:51 I think we’re probably 30 … 30 to 60 days away from having our system built to where the information flows. Listen to this. This is going to be great. See if we can make it work, I think we’re close. So when the job gets sent to us as an opportunity to bid, that information goes in, in this in the Monday.com list, and then it will flow to a job that if we select a bid, and it flows to another list, if we bid it, then it goes to another list to follow up on, for sales and business development. If we win it, then it goes to another list, that when we get the contract, and it goes into our contract department to do submittals shop drawings, make sure the contract insurance is all done all those processes. And then from there, it flows to project management. They do their review, put together a review meeting with the field team, then it flows to field and then field knows now it’s on their list. And it flows to the calendar so they know what to schedule it over the next 24 months. And that builds into our schedule system and then it floats to completion, close outs, all those last items to finish up the job. And we’re done. So literal, front to back lifecycle of the of the project. I think we’re pretty close to making it happen. It’s going to be
Scott Peper 16:00 That’s cool. You can get it right from the beginning when you first touch it when it just isn’t right. It might not even be a project yet.
Charles Covey 16:07 Yeah, it is a challenge and in subcontracting, you’ve got so many fragmented systems. You got your payroll on this system, your timekeeping on this system, and you got your submittals on the system. And then you’re doing, well, you’ve probably got change orders on this one, when you got contracts, they’re on Dropbox, and it’s very fragmented. So there are there are ways to try to streamline that and make it more efficient.
Scott Peper 16:25 You’re now the first cut large subcontractor in the United States to have trained 100% of their field staff with OSHA 30 certification. I know that’s something you work really hard at it. More than 400,000 hours of work time with a non-event, and I’m going to knock on wood now. Right because your return on that. And, and that’s across 100 and plus employees and multiple projects and jobs. So one: I think that’s great that you’ve done that. I think it’s a big commitment to your group. I want to recognize you for that. I think it’s awesome. They should be really proud of that. I’d like you to talk about aside from protecting people’s lives and that they don’t get hurt. Maybe you could talk a little bit about what that does for your, what that’s done for your business. I have some ideas, but I’m wondering how that’s really helped you and where you’ve seen some real benefits. Your focus on safety?
Charles Covey 17:19 Well, this one’s interesting. And it kind of goes back to what I talked about earlier, I’m worried about every everybody else’s money, or their safety, or them in general, I’m worried about everybody else. And ultimately, I was just really worried about making sure that all of our guys get home safe every day.
I’ll tell you this story. If we have time, I’ll tell the story about how this all originated. I’ll get a little bit emotional cuz it’s, it’s tough one. So we had three guys we hired first started the company. And two weeks after we bring them on board, one of the guys falls off a ladder. He’s two rungs high, he’s literally two feet off the ground, falls off the ladder, breaks both arms, snapped, some bone sticking out blood everywhere. It’s just catastrophic. So we go, I get phone call, you know, they get into the ER, I go to the ER. I had to look his wife in the eye and tell her that I was responsible because I had not trained them on ladder safety. We, just like, they’re in construction, you know, they should know. No, that’s not how this worked. It’s my responsibility. So I looked his wife in the eye. And I told her that it was my fault, and then it wouldn’t happen again. And so every single day since it’s on my mind, how do I solve this? Because I’m not looking another wife in the eye and tell her that it’s my fault.
That’s just not happening. So you think about it from that perspective? How do we elevate the safety of our team members to where this cannot happen?
Scott Peper 18:39 It’s great that you’ve tied that desire and goal to something that impactful because that’s really what’s made it turn into a positive event for you and something that you’ve actually probably come through with, what uh, what I’ll add to, as I’m sure from a economical perspective, you know, your insurance premiums are significantly lower.
Charles Covey 19:00 Yeah our insurance company loves us.
Scott Peper 19:02 Yeah, that adds more money to your bottom line. What you do with that money, then with your culture that you’ve built, is give back to those employees and give back to the different charities that you support in your community. And so it’s important to not only save that money, but saving that money does things that are even better for those employees. So while you’re focused on their safety, you’re also allowing yourself at the business to be more profitable, save costs on what otherwise are a huge expense item, the lack of worker safety can increase your insurance premiums to the point where you could go out of business. You need insurance, by the way, and now you’ve been able to not only create that as an opportunity to keep everybody safe, but you’ve made yourself more profitable and you’ve given back to your employees with some of those dollars to do that. So I think that’s something important. And the client.
Charles Covey 19:47 Yeah, it’s been a huge selling point for us. And we probably don’t push this enough only because we’re, we’re just so focused on the team members being safe and we didn’t even realize at the time, what a selling point that would be.
You know, you look at some of these big clients, you know, on these multibillion dollar international general contractors that we work for, this is a very key item for them. In fact, it may be one of the key items for them on their list of things that they’re looking for. In a subcontractor, they got to have safety. They don’t need some bullshit on their job, they need to know that when they bring you on their project, the safety is handled, they don’t need a problem child. They just know that when Alphapex shows up, we’re the safest waterproofers in America. We say that one pretty often because it’s factually true. There’s not another company that can match our record or our training level when it comes to safety. So I’m assuming, and I hope that more companies will match that level, because I think that will just elevate our industry as a whole. But at least for now, we definitely are the safest waterproofers in America. And that’s a pretty good selling point. When you know, you could put guys on a jobsite and you could promise that GC, Hey, there’s not a safer company that you can hire right now. We’re going to help you be better at your job.
Scott Peper 20:50 I think it’s a big accomplishment, something you should be proud of and, and I also want to point out for our listeners to be able to understand the importance of it but also how it can help them as a business gain more customers, do a better job, and be more profitable? Who would have ever tied job performance and employee safety to those other three items? And they directly relate. So, again, kudos to you, man.
Charles Covey 21:11 Thank you. It was a very, very expensive process. Yeah, guys, you got you pull them out of the field you had at the cost of the training, of course, but then it’s the hours that they’re sitting in that train, and they can’t be out producing revenue for the company. So it was a very expensive process. I don’t think you can say safety is ever too expensive, because it’s working. And so from that standpoint, we’re very happy we have the opportunity in the idea to do it, I would suggest it for everybody. It’s a big, it’s a big bullet to bite, but I think you should consider it.
Scott Peper 21:40 Well, to the point what was two broken arms could have easily been two people dead if it was a little higher up and a different job, will longer, if you didn’t have safety protocols in place. Today with the type of work and the type of jobs you’re doing. It could have easily been a 20-foot scaffolding instead of a two foot ladder.
Charles Covey 21:58 Right. That’s a great point you bring up I get that We were working on smaller projects are much smaller company three people. And now we’re working on high rises all across Texas. And yeah, that’s a slip trip or fall from 33 stories up. There’s no coming back from that one.
Scott Peper 22:14 Yeah, man, this has been an awesome conversation. Charles, I really appreciate your time on this. I think you fit the bill perfectly. And I’m reading this point. So thank you so much for being so open and honest and sharing all the great value you have for us and our customers and clients.
Charles Covey 22:29 Man, it was a pleasure. So thanks for putting up with my monotone and my asshole nature. As we work through this just trying to make subcontracting better.
Scott Peper 22:36 You’re a nice asshole. I think your wife’s right.
Charles Covey 22:38 Appreciate it. Thanks a lot, Scott.
Scott Peper 22:41 You’re welcome, man. Take care everybody. Have a great day. Thanks for joining us. Talk to you soon.
Transcribed by https://otter.ai
Leading a successful construction or manufacturing business can be tough. To survive, sometimes you have to be a real MF’er. We get it — we’re real MF’ers, too. MF’ers do what’s right, pay it forward, lead through action, and get the job done.
Wait … what did YOU think we meant by MF’ers? 😉
In THE REAL MF’ERS, Scott Peper sits down with leaders from construction, manufacturing, and related service providers to see how they built their business, what they are doing differently, and why it works.
Full Transcript Below
Scott Peper 0:39 Hello, everybody. And thank you for joining us today. I’m really excited to have one of our guests Charles covey from Alphapex — Founder, President, great friend. We’re going to talk about all kinds of exciting things today is from Whack-a-mole to unicorns to how you can grow your construction business, marketing, marketing during COVID, safety. Just differentiating yourself to be what a kick-ass construction company looks like not only in the old days, the new days, but now moving forward here through the Coronavirus.
So, Charles, welcome.
Charles Covey 1:11 Hey, great to be here. Thanks for having me.
Scott Peper 1:14 Great. You’re welcome, man. I really appreciate you joining us. You are the perfect guest to the start this series off. You know, when we think of, we talk about Mobilization Funding all the time, and we always refer to it as MF or — really what happened was our customers would just call us MF or friends, investors, people would say Oh, MF and shorten it. And then we have the idea, albeit six years after we started, that maybe we should start coming up with a bunch of a group of folks called Real MFers. Well, you are the first Real MFer Charles
Charles Covey 1:43 Very cool to see that to see that terminology. Like when I first saw when I first saw the invite I thought you know that’s that’s really good branding, matches MFer and their company. Couldn’t have done it better.
Scott Peper 1:55 I probably would get some cool gear and shirts made up around this whole theme which of course, we’ll definitely share with you and get you some stuff. So I’m actually very fortunate and glad that our clients have referred to us as MFers and shortened our company name has it turned out to be pretty good. If you would just for the audience, would you take a couple minutes and just let them know about yourself, your business where you’re at? And then we’ll dive into some questions that I have for you based on some of the things I know about you personally and collectively and really get into it.
Charles Covey 2:25 I started construction at 16. So I grew up on a farm and you know, on a farm, if you got something to do, you got to do it yourself. There’s nobody coming to help you. So we just learned how to build stuff, build barns and we fix cars and we built fences, we did all this stuff that was necessary with our hands. So, going from that to construction was really a very smooth transition. When I was 16 I started framing houses and just loved it. Just love constructions love the people. I love being able to see that building appear from nothing is right in front of you. And I’ve just always identified with that and just passionately love the business and the people in it.
So I really started — you know, that hammer swinging history really guides a lot of the stuff that I do now because yeah, I was that guy, I was the lowest man on the totem pole, making a few dollars an hour, you know, on that roof in the Texas sun. And so I’ve been in that position. And that’s really how we’ve built the business, is really prioritizing the field and prioritizing the people that actually grind this out every day. So, I think that perspective has been good. As far as the business itself, you know, I was working in commercial construction for a large general contractor. And I learned a lot and I was always looking, you know, what are those ways that I can get into business for myself, what are those ways that I can, can be an entrepreneur, and waterproofing came up pretty often as a problem area. Come on guys, is there anybody that can take care of this scope and get it done well, and I just wasn’t finding those guys. So, I thought that was our opportunity. That was a chance for us to really disrupt a little bit this market.
If you think about our particular space, so Dallas Fort Worth North Texas area. Very busy, always been a good construction, how a lot of growth here for the last 2030 years and the waterproofing space — there’s three or four competitors, and they’re all 25 or 30 years old. And they’re still doing it about the same way they’ve always done it. So that was a really good spot for us, you know, to be the innovator to be the disrupter, to kind of jump in that space and and turn it upside down a little bit. So we don’t have to completely revolutionize it, but we just have to do things a little bit better, a little bit more innovative. And that’s how we ended up where we’re at.
So, it’s just really taking the approach of, of every day trying to be a little bit better of seeking out what are the processes that can change? It turns out, almost everything can stand a little bit of change. So, we find out what those key elements are, and we try to change them a little bit and get more efficient, get better.
Scott Peper 4:37 Yeah, and it doesn’t have to be brand new, just doing the same thing in a different better way.
Charles Covey 4:43 Agreed. Agreed. Yeah, we just seek that out every day. Most of the things that I’m doing, that you’re doing, every single day can be improved on. Like, let’s not pretend that the human race has just perfected existence. There’s so many things that we do that we can improve on. So we’re always seeking out, What are those things? And what are the ones that really impact the bottom line and really impact the people around us and impact those buildings that we build? We try to find those.
Scott Peper 5:09 Well, it’s funny one of the things that I always admired about you and your story, I obviously share a similar background in construction. At least working in and around, my father had a commercial glazing business and I worked in and around that business all the time on the job sites and really develop the same passion for construction that you did. Albeit I ended up in this field, or in and around it in a much different way. But the genesis of the enticement to it was there. One of the things that I always found really intriguing about you is you did find this waterproofing space. And as you mentioned, I’ve always heard in and around our world here in the last six years, just that scope being very difficult, and if you can find someone that does it, they either don’t do it as well as they could or as wanted. Just it’s just hard and you seem to have figured out the hard but also how to maximize that opportunity to deliver a great product, do it efficiently and run a great business.
You started to touch a little bit on the origin of how you got into the waterproofing side. But can you talk a little bit about where you saw the problem area was and then how you decided to get yourself up to speed quickly on what waterproofing is, how to make it better? And then most importantly, how did you execute on that?
Charles Covey 6:26 Yeah, the biggest deal that I was seeing as a as a project manager, as a superintendent for GC, I did both of those roles is that the subcontractors in the waterproofing space, they didn’t have the clients interest in mind. They had their own interests in mind for damn sure.
But you know, where was that customer service? Where was that high level of care for what helps the client be better? So yeah, of course, they wanted that change order for them. But what about the client? What about the person, you know, who hired them on the job? How do we make them better? And it was really easy for me mentally to go from that approach. I don’t know why some people have that have an issue with that approach. But I’m in the business for my clients, plain and simple. And really, that was the spot that we saw. Nobody’s really operating at a high level of customer service. But it’s not that complicated. So if you come at it with the right, right mindset, it’s really been game changing, I think in our space. And it’s, it’s been a wake up call for a lot of subcontractors in our area to really elevate their game to a higher level of customer service.
Scott Peper 7:24 Did you find that to be in every scope or just particularly waterproofing? That opportunity?
Charles Covey: 7:31 There’s Yeah, great question. I think there’s space for improvement in every scope. Waterproofing is unique a little bit in that it’s not a scope that the GC has time to really understand on an infinitely detailed level. But the devils in the details with this scope, you have to know them. And so if they don’t have a trusted partner that they can go to, now it’s on them to try to figure this shit out. And that is not an easy thing with our scope just because there’s so much minutia and if it leaks, it’s a million dollar problem just that quick and so on. Having that trusted partner that could really elevate their customer service game and still be knowledgeable and still be a high quality installer. I think that was a spot that was underserved. And our clients can attest, it’s been a really, really welcome thing for them in the marketplace to have somebody like us to turn to, hey, we’re not we’re not perfect. We have a lot of human beings that do things wrong a lot because they’re imperfect. Me especially. But I think that mindset of Hey, we’re in it, to serve our clients and to really help them be better at their job. I think that’s the key.
Scott Peper 8:34 You know, it’s funny to hear you say that because I talk to a lot of our clients and just general contractors, people in general and, you know, few humans think that way, whether it’s on the general contractor side or the subcontractor side.
Maybe it’s the GC thinking about it for the owner, or the sub or really the GC thinking about how important the sub is on the contract for that on the project for them. I think if, one of the things I like to talk about, is if everyone would just sit down and have a real conversation and stop hedging against each other, as a third party on a construction project, seeing it from both sides, and really have an invested interest in in nothing more than just the success of the project. Because for us, we Yes, we have a client that is our direct borrower, but that general contractor and the owner on the project is just as much of a client of ours, because we are completely linked to one thing and one thing only, and that is the performance on the project. If that project performs that means our subcontractor performs that means the GC performed, that means the owner got what they wanted, and money flows all the way down the hill to everybody and everybody’s happy. And it’s what I always find is the lack of communicating sometimes on some of these projects, causes the issue. It’s like, well, I don’t want to tell them that and I want to I’m gonna fight this and push against that. And if everyone just sit down and say, You know what, this is what I’m great at this is what I’m not, this is where I need help this where I don’t, it seems like it’d be so much easier for a construction project.
Charles Covey 10:00 Now I think you’ve hit that right, that nail right on the head. Because for us, I think that, at the very least, can we just get the real, the real stuff? Like, why do we have to like, well, you’re not gonna hold my card with my chest, I don’t want to let him know, Let’s just be real, let’s just be honest with each other, let’s just be upfront about the problems that we see. Because ultimately, that that upfront communication, getting all that out on the table, that’s what the project needs to move. And so trying to hold on to some information, because that might help us later … That’s bullshit. You know, like, we’re trying to get our client and their building to the end in a profitable and expedient manner with a quality building, like, you need the information to flow. And so I think that that’s something that I don’t know, like subcontracting and general contracting is gotten to a really interesting point where it’s a combative space, sometimes. You see this, you see jobs go south, and really, it’s really not the job going south. It’s the relationship going south is the communication going south. And if you can hedge that by just being real and just being upfront, just being honest with the client about what’s going on, and let all that information just be on the table as a discussion point. I think that perspective, maybe we’re not, we’re not perfect. We have communication issues at times. But I think that being upfront and real with our clients is a really big differentiator.
I think of an example, like, a lot of times when we’re doing contract buyout, I’ll tell the client, hey, you know, I really think that you should hold us accountable for this particular thing. Let’s make this language pretty broad, because, you know, you need us to finish this result and cover this whole scope for you. So let’s make this language a little bit broad, because I know that’s good for you. And then on this thing over here, it’s a little vague, like, you kind of got me wrapped into this other guy’s scope. Let’s clarify this one here. So I’m trying to buy a contract. It’s good for them and me. And it’s not that complex. Let’s just all work together as a team, we got the same goal, get this building built profitably at a quality level, and it’s not that complicated.
Scott Peper 11:52 You know, when you and I first met one of the things I admired, I don’t even know if you remember this part of the conversation, but as in your office, we’re talking through the scopes, just having a general conversation about the construction and one of the things I thought was really interesting about your particular scope and what you have to manage around. I always hear a lot of people talk about is they’re always blaming the other trade Oh, they’re slowing me down this trade slow me down, I don’t have the site or they screwed this up so I can’t do my thing. You know, more than any other scope, you probably touched just about one every other trade on that job. I mean, whether it’s walls erection, roofing, electrical, plumbing, your ceiling — for everyone doesn’t know what waterproofing is. I mean, your ceiling, the structure, you’re making it waterproof, obviously. So you’re you’re on the walls are around the windows, you’re near the joints, you’re near the roof lines, anything that connects anything. You have the opportunity to blame everybody for any problem you want. But yet, when you and I talk, you never blame anybody. Never.
Charles Covey 12:48 Never. We, we have to be careful with that. You know, like sometimes somebody screwed up and I can’t start because they didn’t do their job. But I’m not just going to send a letter. Hey, we’re delayed this other guy sucks. I’m going to come out and say, Hey, this thing needs to go, these four changes need to be made, and then we’ll be able to start as soon as possible. Yeah, sometimes there has to be some, some work back and forth, but doesn’t have to be in a combative manner. We can just say, Hey, this is the facts. I need this to keep moving. Let’s do it together. It’s like, you know, providing the solution instead of just putting the blame. But you see that you’re right. I mean, the blame gets pushed in, in the contracting space. So many times like, well, it’s just somebody else’s problem. We try to own the problem, you know, like some other trade has a thing. Let’s walk it through, let’s make sure that we’re there. Make sure it gets done right. and own the problem. We want to carry that on our shoulders. And I think our client appreciates that.
When a client comes at us and says, Hey, guys, you didn’t do this thing. I mean, if it’s true, I’m gonna take the client side, like, yeah, you’re right. We screwed that up. Now I look right at my PM. Like, what the hell is going on? And why aren’t you taking care of this client? There’s going to call them out because it’s real. That’s actually what happened. And to take the client side, I’m not going to push back and and pretend that we didn’t screw up because yeah, we’re human, and we mess some things up and we’re gonna own that shit. We’re going to fix it quick and move to the next.
Scott Peper 14:03 You talked about some of the early days. How did you maintain the success level as you grew and scaled hiring talent, finding talent and doing these jobs and keeping up that level of performance?
Charles Covey 14:14 I’ll tell you if you want, I’ll give you what I think is the absolute single biggest factor. I don’t worry about Alphapex money.
That seems crazy, right? Like how could that be? How could you run a business and not worry about the money? Yeah, I review the financials. I know what’s going on with the money, but I don’t make the money. My first concern. So I’m going to measure the other things. Are we the safest in the business, are our clients getting taken care of and the buildings getting built on time and correctly? Are we solving the client’s problem? Are we so good at helping them with their job that they’re not going to go anywhere else? So if I worry about all those things, ultimately, I’m worrying about their money.
So if you think about this, so I’m worrying about what gets them to their money, faster. So for the client that’s going to be getting the building done, getting the mobilized and off the site, no callbacks, no leaks, no warranty issues over the course of the job. And then for, now, what about my suppliers? They’re very critical to the, to the chain of things that we do. I got to worry about them. Yeah, I’m going to write them a check. But I still need to be worried about their money, because I’m going to need them. So I worry about getting them paid quickly, making sure that our ordering processes allow them to be efficient, they get to make more money, they love us. And then our staff, our team, people that on our team, I worry about their money, are they being paid top of the market are they in a work environment where they want to be there. We’re not just working them into the ground, and in the way that construction is known for. So I’m worrying about everybody else’s money. And guess what happens to Alphapex company funds? Most of the time, it pretty much takes care of itself. Now, when I try to explain this to people at first are like, you know, this is pretty crazy. How can you not worry about your money, but I do I worry about everybody else’s money and then Alphapex gets taken care of.
Scott Peper 16:01 You know, instilling that culture in yourself is one thing we you know, you’ve grown now you have over 100 employees, culture is very important. You talk about it all the time on your website, it’s on your paperwork, it’s on your documents, it’s in your, it’s in your company logo, it’s everywhere, you can tell you’ve worked really hard on that. Talk a little bit about how you develop that culture, how you implemented it, and what you do to keep it going.
Charles Covey 16:25 So the core values are not done for show. They’re not done to impress. They’re done to create a mindset frame framework. And so, those core values are — there’s five elements in the Alphapex core values. And some of our other businesses have a slightly different set of values based on the decisions that need to be made in that business. So it’s a decision tree, and we create those core values. So it’s, this is not just the thing that we put on the wall, just because it looks nice and has bright colors, and it checks the box of Yeah, we have. It’s a decision making process for every single thing that pops up. So we had to run through these, you know, we think these are the core values, we got six or seven here and run through every possible scenario we could. Does this word or this phrase help our team make decisions and be better and take the company to the places we want to go? And I expect at some point, those core values will adjust as the goals and needs of the company changed. So it’s a decision making tree that goes that goes with us every moment of every day.
And I think some people just look at, well, you know, we want some, what’s some nice words that look pretty and we can put them on the wall? What are they going to do for you? What are those words going to do to actually improve the business and take it to a new level?
Scott Peper 17:35 When is your team first introduced to your core values?
Charles Covey 17:38 Immediately, the core values are in the onboarding paperwork. They’ve agreed in the onboarding paperwork that they read them, they have to understand what they mean, and they have to agree to uphold them. If you don’t uphold the core values, buddy you’re out. So that’s a pretty quick one. And I think that’s really it.
People understand pretty quickly that that’s the way that the business runs and we talked about to our clients too. It’s a selling point. I was at a client yesterday, client in Fort Worth, and we were doing a presentation for their field team. So all their superintendents and assistant superintendents, and we were talking about waterproofing and quality and the other items that we do every day, and just try to help their team be better. Just, you know, free information I got, I want to help these guys be better, and help to help them understand our scope of work. And they’re super appreciative, great group. But we talked about the core values, they’re like, hey, this is the expectation that we have of our team. And you see somebody not matching it, please let us know. That’s a really interesting thing. We promote those core values to the client. And I’ll get a phone call or a text occasionally, hey, just so you know, I saw one of your guys on the site, you’re probably going to want to know about this. I’ll get a text, they’re not upset at me, but they know that I would care.
And they know that I have a super high expectation, and they’ll let me know, I really appreciate that. That’s been a pretty cool thing of, you know, really pushing that to the clients, letting them know that hey, we’re a high-level organization, well developed. We have these core values that are a functional part of how we operate and they’ll help help us watch out for him, which is really neat.
Scott Peper 19:01 So this is such a good topic and it’s hard. It’s also a hard topic specially for a business owner and I speak from experience. It’s hard it’s hard for me I think it’s something I’m always working on is how can we make our culture better? How can we keep our culture the way it is, and always coming up with new and creative ways to do that, or, or keep new and creative ways to keep what we have going? You know, to your point.
Charles Covey 19:22 I always have to do a disclaimer, you notice my voice is monotone. It’s the same shit all the time. I’m excited. I’m sad or whatever, you don’t even know the difference, because I’m just kind of like this all the time. It’s really funny because like, Oh, you know this guy Charlie’s doesn’t seem to be very excited. No, I’m pumped. Are you kidding me? But this is about as animated as I get. So yeah, I’m excited to be here for sure. But you might not tell from my facial expression or my voice inflection.
Scott Peper 19:48 You’re a little more animated when you had about 17 inches more haircut and you went about four months past your normal date there during the Coronavirus.
Charles Covey 19:55 Yeah, I don’t look good like a gorilla. I wasn’t very happy. My wife thought it was cool as a novelty. Like Yeah, anyway, that was a good time. The other disclaimer is that I’m an asshole. It’s just kind of how I’m wired. My wife has to make sure when we go to client events, She tells them up front, Hey, just so you know, I’m the nice one. Charles is an asshole, don’t hold it against him.
Scott Peper 20:17 She called you a nice asshole.
Charles Covey 20:20 That’s true. Yeah, she does say that I’m the nicest asshole she knows.
Scott Peper 20:24 Charles, one of the other things I really wanted to cover with you was your I think you do a great job marketing your business. We’ve talked about some of the ways you’ve separated yourself, with your customers and your clients. But one of the things that I really want you to discuss is just your overall general philosophy on marketing, what you were doing in the past what you’ve been doing along the way, what you’ve learned, and I think we’d be a little remiss if you didn’t maybe talk a little bit on what you think might change with your marketing moving forward, you know, specifically as it relates to the Coronavirus or just what you think is going to change here and in construction, our approach to marketing
Charles Covey 20:59 Our approach is virtually the same thing that we do on the job site, and we talked about this and some previous things have, we’re worried about the client, what is the client need to be better. And so our marketing really is that, is that way too. So we’re giving a lot of information, the client wants to see their project, they want to see nice pretty video of their project. As it goes together. They’re emotionally invested in this project that they put hundreds or thousands of hours into. So we’re going to definitely showcase those projects and let them see it and let their friends see it. We’re going to share information with them, either in person, in their office, or with a lunch and learn or with videos on YouTube or on the different social media channels, or different things that we send out, that help them be better at their job with the things that we know which is our scope of work. So help them understand how to QA/QC our work, how to understand our work, how to help direct their project, regarding the things that we do in Division Seven. And so our marketing is very similar to the way we put work in place and that’s really be focused on what does the client need to be better. And then we don’t really ask that much we find that if we give a lot, when we do have that ask of, hey, let’s do this job together, that ask is welcome. Because we’ve been giving so much before that. So if you think about this, ties back to that whole thing of helping the client, get to their goals or be better at their thing.
So, birthdays, anniversaries, these things mean a lot. That’s an emotional tie. So as a marketer, as a business owner, you want to tie your business name, and the things you do every day, to an emotional connection. And birthdays are a really good way to do that. We found that a lot of a lot of our people that we work with, our clients, they, their own companies don’t even remember their birthday. The card that they get from us might be the only thing they got that day from somebody outside their family. So it has a really emotional connection and impact and it’s very, very long lasting. People remember these things for a long time. So just an example. I don’t believe I have one handy, but, we do pocket knives for birthdays. So it’s a pocket knife and it’s got their name on it and then we got a birthday card that is signed by everybody in the office wishing them a very happy birthday. And they receive that. Now, this is a big task, because you have to have a database of all your clients, their contact information, where they are, what company they’re at, how to get to them, their birthdays are it’s got to be accurate. Otherwise, you look like an idiot. But this is a lot of information. It’s hard. And that’s why most people don’t, that’s why most people don’t do it. And so I think that in marketing, you’ve got to look, what’s that next step? What’s that really hard thing that you don’t want to do? But nobody else is doing it? So you really should do it. And that’s what we found is the real differentiator, what’s the hard thing to do to connect to your client? Go do that. Chances are, your competitors won’t.
Scott Peper 23:41 No, you’re right. It’s invaluable. And anytime you’re attaching a memory to you and your business of something you’ve done that’s really been emotional to that person. It’s going to be more memorable and more impactful and those are two great things that every time
Charles Covey 23:54 But how often do you get gifts that’s just got … They send you a gift — we’re going to use gift loosely because it’s just an item that has the company’s name on it. That’s not for you. That’s just a general, they’re giving you a generalization of where we kind of feel nice about you. But if somebody goes to the effort to document all these things, took us forever to get all these names and emails and, and addresses together and birth dates. But once you do that, and you identify that you care about them as a human being on their birthday, which has intrinsic meaning, and something special, something custom, something you made for them. It’s, it’s really, it’s really a very important connection. I think. We don’t give anything to a client without their name on it. Does anybody throw away something with their name on it? Absolutely not. They keep that thing forever. So we’ve seen these, these different colored Yetis that we’ve given to people, they’re five, six years old, they’re just beat to shit. And they’re still carrying that thing around on the jobsite, every day because they love it. It’s got their name on it. And that’s really cool for us and our brand and what we stand for, and they really cherish that. So that’s cool. I would say putting somebody’s name on a gift is really impactful. Just don’t give it to them if you can’t put their name on it.
Scott Peper 25:04 I’m trying to think back. Am I throwing anything out that have my name out other than junk mail? And I would say probably say no.
Charles Covey 25:11 You should see our office around Christmas time, we might send out 500 or 600 custom gifts around Christmastime. Can you imagine the volume, like, how do you keep track of that many custom gifts? Got to check the names you got to check the addresses people moved between companies all the time. Got to make sure you’re taking it to the right location. Yeah, it’s a logistical nightmare but it’s totally worth it. I definitely give kudos to my wife Alicia who handles all of those elements of the business and she does a next-level amazing job to get that done and keep it organized. Everything goes out wrapped nicely with a bow on it with the name tag. You know, our branding, their name, custom gift.
Scott Peper 25:49 It’s awesome, man. That’s definitely an impact. People are gonna remember that. What are you doing different now with Coronavirus? I guess in general, what are your thoughts around the impact of the Coronavirus? What’s happened? I mean, there’s so many it’s impacted everybody there’s there’s no country, there’s no person, there’s no industry, everybody’s been impacted. What are the things you’ve done differently? How have you adjusted or maintained or, or etc?
Charles Covey 26:13 Yeah, so construction has been incredibly blessed. You think about it even across the country that Texas has been sheltered, maybe more than some, but there’s a few states that have had some construction shutdowns. But for the most part, construction, construction suppliers, construction manufacturers are still being able to operate. And that is, that’s just amazing. We’re very, very fortunate to be in that position, very thankful. But if you think about it, the world has changed a lot for construction and for everybody else. So yeah, we can still work every day. But the way that we do that, the way that we connect to our clients, the way that we get information from our job sites, the way that we interact with our team members, the way that we train for us has been very different.
You know, we can’t have that training meeting every Monday and pack 120 guys into a room. That doesn’t work anymore. We’ve got to come up with ways you’re like, how do we do this and film it ahead of time. And we text out a link to everyone. So they could still get the same information, but on a screen of a phone instead of in person, and then how do you connect from a screen of a phone is not the same emotional connection, as it would be as if you were in person. So now you do it in smaller groups. Now you do a one on one, you’ve got to find a way to connect, I think to your, to answer your question more specifically about the client relationship. Connecting with human beings is a really, really important part of construction. Like Yes, we build buildings, but hey, man, we are in the people business. And that’s not going to change with technology, but new building methodologies like we’re going to be in the people business forever. And because that we can’t lose sight of the fact that, Coronavirus or not, you still have to find a way to connect with the people that are in the business. So finding one of the ways what are the ways we can think outside the box, come up with something new, to get a contact so get an emotional connection like we mentioned. Here I’ll show you an example. This is the Alphapex Pandemic First Aid kit. If you can see that it’s whiskey and beef jerky, and a mask.
So it was a huge hit, you know, superintendents, project managers are just getting beat over the head every day with all this Corona stuff and having to sanitize job sites and, you know, make sure everybody’s washing their hands and check temperatures and all the different protocols, and whiskey and beef jerky was really impactful. So that one was just outside the box, what’s something we can do that will allow us to connect with our clients for just a second, just to get there and let them know that we care about them that we’re here for them if they need us. And it was a challenge to get all those delivered. Because you know, some people at the office, some people at the house, some people on the job site, and so we were able to get that done and send out a few hundred of those and it was pretty neat to see the reactions but we’ve got to think outside the box now.
Scott Peper 28:44 You know, finding new and creative ways man and helping people when no one else is or when fewer people are is so important and if you just generally focus on helping the person and helping people in general, anyone you come in contact with, but especially your customers, especially your team, you’re going to be so much better off and it’s so much easier to manage your business because the decisions are are easier you do what’s right you just do what’s best for each person and when something extra special for someone in the point where they’re especially when they’re getting beat down by everybody is a memorable and honorable thing, really is.
Charles Covey 29:22 You have to have the long game in mind. This this stuff that we do is not a short term thing you don’t see a monetary result quickly.
Scott Peper 29:31 No, no. And you know you’re not doing it for monetary result either. And who knows you you’ll never tie an ROI to how many custom gifts you bought, you know, doesn’t mean you can add more money to the project, doesn’t mean any of those stages means it’s what’s right help separate you keeps you more memorable a game where everybody’s everybody can be very similar, right?
Charles Covey 29:52 It’s a differentiator and I know absolutely for a fact that if you show people you care, your business will grow.
Scott Peper 30:02 100%
Transcribed by https://otter.ai
In our new YouTube series, Built for Growth, we talk with experts about some of the biggest issues facing the construction and manufacturing industries. For our first episode, we were honored to have Loretta Calvin, Diversity & Inclusion expert and CEO of Monroe Strategic Business Solutions, join us to discuss diversity in construction.
It is no surprise that construction faces a diversity issue. The stereotype of a white, male, middle-aged construction worker has been largely accurate for decades.
According to the Bureau of Labor Statistics, the construction professional workforce breaks down like this, in terms of diversity:
- 9.9% women
- 6.2% Black
- 2% Asian
- 30.7% Hispanic/Latino
Why diversity in construction matters
Calvin spells out why construction business owners need to invest in diversity and inclusion. For one thing, the workforce is aging out of the business. The median age of a US construction worker is 42. Investing in diversity efforts can open up new pools of talent.
Construction is a great career track, with an industry average salary of just over $53,000, plenty of career stability and opportunities for upward mobility. With expertise in a construction trade, construction management, or construction administrative services, you can work almost anywhere in the country, or even the world.
According to Calvin, the industry should invest in training and educational programs for high-school students, women, and other under-represented groups, in order to increase awareness about construction as a career track and build early relationships with future recruits.
- Diversity also opens up new opportunities for government and municipal projects. General contractors and large subcontractors can partner with minority-owned businesses to win government contracts, which often have diversity workforce requirements.
Last but certainly not least, investing in diversity and inclusion supports your business’s productivity, workplace culture, and innovation.
If you are interested in working with Loretta Calvin and Monroe Strategic Business Solutions, click here to send an email.
The construction industry is built on relationships. Having a background of mutual trust and respect, on top of a history of solid performance, can catapult your company over the competition when it matters most. If you are new to the industry, this is intimidating. You need the jobs to build the relationships, and you need the relationships to get the jobs. Creating a set of core values for your company and broadcasting them to your customers will signal to a GC or owner that you are a solid worker and an aligned partner. Core values will win you more business, attract and retain the best talent, and give you and your team the most fulfillment from the work you do.
Core Values Defined
Core values are the principles that guide YOU and consequently your company’s actions, the individual actions of your leadership team and employees. They are the foundation of your corporate culture — how you speak and behave toward each other, your customers, your larger community, and the world at large.
Core Values Start with You
In an article from Winning the Business titled Improving the Win Rate for Your Organization, growth consultant Jeremy Brim writes, “the biggest determining factor in win rate and the growth trajectory of organizations … is the behavior and commitment of their leadership and how that is cascaded down through the organization.” You have to create a culture of winning. You do that through established values of perseverance, integrity, and excellence.
It’s okay if your core values are aspirational – they should be. Present them to your team with an action plan that takes you from aspiration to reality. Values must be statements that truthfully and accurately embody your company’s culture. If not, they are meaningless at best and harmful at worst.
Values Matter Every Day
To reap the benefits of core values, you have to actually live them. In the HBR article, Make Your Values Mean Something, the core values of Enron are listed: Communication, Respect, Integrity, Excellence. That sounds great, until it was all revealed as lip service.
You can’t put your core values on the wall, or on your website or letterhead, and call it a day. Just as in the rest of life, words and actions build reputations in the construction industry, not fancy displays with no substance. You have to embody, and live in each day, the core values of your company. This is why they have to start with YOU. Every day, in every decision, you must allow your core values to guide you.
Remind your team to allow the corporate values to drive them when making decisions and acting on behalf of the company. When your core values are a living practice shared by your entire organization, rather than a dead-on-arrival document, you all act according to those values. Acting with integrity and respect earns you a reputation for having integrity and being respectful. Striving for excellence in everything you do creates a reputation of excellence, because it becomes your and your team’s standard.
Establish core values to guide how you will work — then go do the work.
Core Values Drive Sales
Core values define culture, which guides actions. This includes how your sales team approaches new opportunities. Your core values are the cornerstone of your sales culture. When your entire sales team is aligned in their approach to new business, you get consistent results you can bank on.
Your core values set you apart from the competition. They create a positive identity around your company. They become part of what your company is known for. That can be a powerful influencer during the bidding process.
Imagine a steel erection company, we will call them Sam’s Steel, submitting a bid to a GC they’ve never worked with before. Sam’s core values include statements such as:
- We are accountable to our customers, our community, and each other.
- We always communicate with as much transparency as possible.
- We are committed to excellence in everything we do.
The bid includes a schedule of the way they will go about doing the work, how they will invoice for it each month, a cash flow prediction, breaking down the startup costs for the project, estimated weekly expenses, and how they finance their schedule and project costs. It also includes a testimonial from another general contractor. In the testimonial, the GC says that Sam’s Steel was great at communicating, open about challenges and ready with solutions, and that they performed excellent work with no major issues.
The GC can see that Sam’s Steel is already living by two core values: transparency and accountability. The project cost breakdown shows the gaps in cash flow, and the subcontractor has wisely already solved the problem for the GC. The testimonial lets the GC trust in Sam’s Steel plan and gives them peace of mind that the work will meet and exceed their standards. The trust comes in the details that Sam has provided and provides the comfort to the GC that Sam knows what he is doing!
Core Values Drive Hiring
There is a common misconception — in the construction industry and others — that skilled labor goes where the money is. The truth, according to the data, is that money is rarely the primary reason an employee leaves a job. In fact, according to a report from Hays US published in Construction Dive, 65% of surveyed construction professionals would take a pay cut for their ideal job. Even more telling, the #1 reason given for employees leaving was … CULTURE.
Create a culture that is hard to leave. Live your values with your team as much as you do with your customers.
According to a report from Manila Recruitment, 80% of employees leave due to bad hiring decisions. That means their resignation is on You. If a recruit can’t perform the work, you failed to hire the right person. If a recruit doesn’t share your company’s core values, you failed to hire the right person.
Make your core values known at the beginning of the hiring process. Talk through them with recruits. These are our expectations. This is the code we live by. If someone does not align with your core values, they are better off elsewhere, and you are better off without them. Not because they are bad employees, but because they throw your company’s alignment off-balance. It only takes one employee who does not believe in acting with integrity, for example, to frustrate and demoralize the rest of the group.
Core Values Drive Personal Fulfillment
As the leader of your company, I can guess that you spend a LOT of time at work. Why not enjoy that time more, by being surrounded with people who share your principles? They don’t have to share every opinion you have (in fact, that would be boring and limit your creativity), but they move through the world making decisions based on the same set of values that you do.
That is what a team built on core values gives you.
When your team is built on values, their performance, both on the jobsite and off, can be a source of pride. Invest in their ability to live those values in their own personal lives, and the feeling of pride and fulfillment only grows. You are now building a business with a purpose.
When core values guide your company’s actions, you reap the reward of new business, better employee retention, and your own personal happiness.
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