The Huddle - Episode 218. The Most Expensive Mistakes Aren't Installation Mistakes
When something goes wrong on a flooring project, the installation is often the first place people look. But some of the most expensive mistakes happen before the installer ever gets to work.
A bad estimate. An unclear scope. A promise that never should have been made. Poor communication between the office and the field. Hiring the wrong person or failing to catch a problem early enough. These decisions may not leave a visible defect in the floor, but they can cost a business far more in lost time, profit, relationships, and reputation.
In this episode of The Huddle, Paul, Daniel, and Jose look beyond technical failures and talk about the mistakes that happen throughout the entire business. They discuss how better communication, planning, leadership, and accountability can prevent small issues from becoming expensive ones.
Technical skill matters, but a great installation can't always save a poorly managed project. Sometimes the biggest opportunity to prevent a failure comes long before anyone touches the floor.
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music] What is up team? I hope you like that new intro music. Welcome back to the
huddle, the number one podcast in flooring. We're here every single week,
every Tuesday, help you guys gain forward progress in your career. Simply put, we're here to help you guys win.
For all of our new viewers, welcome to the team. the main stays of the huddle, Mr. Daniel
and Jose Gonzalez. At least Jose is with us. [laughter]
Uh, well, there there's Jose Double. You get you get two times the Jose today.
Hey, don't let me change my name before I come in. Daniel just he looks so sad. He's a
There we go. I already hit the sign out and back in.
Mr. Daniel and Jose from Grand Rapids, Michigan with Preferred Flooring. How's it going, fellas?
What's going on, man? Good. I I see uh Jose, who had a a a
pre-Huddle snack, still getting it cleaned up, getting ready for the pod.
All right. Well, today's uh topic is about the most
it's kind of a statement. uh the most expensive mistakes aren't always
installation mistakes. I add a little bit to that and I think that um
that uh we're going to have a little bit of fun there. Uh I have to jump off a
little early so I apologize for that. But uh the guys uh will keep the
conversation rolling and please join us in the chat
with your ideas and and comments as well. Today's sponsors are Pro Installer
Magazine. Go check them out. uh big supporters of the installation community
and always got some good information in there, good articles, but also uh you
know, upandcoming tools, new new products, that kind of stuff. So, go check out Pro Installer. It's it should
be your go-to resource just to kind of stay in tune. That's the easiest way to start your your uh journey of getting
involved with the IND industry is just go subscribe to Pro Installer Magazine,
check them out or pick up an issue at one of the distributors. Uh I think
they're still on distributors counters. So check out Pro Installer. Our other um
our other sponsor today is Trade Tap. Ashton just um just told me that uh our
new video is out. I wonder uh Ashton, tell me in the uh chat if we can play
that and I'll just let her play our new video and you guys can uh check out the
uh the new trade tap video. Hit it.
You've lost jobs to lower bids, not because their work was better, but because the customer had no clear way to
know yours was. When proof isn't visible, price becomes the only thing
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proof. Yeah. Boom. That's pretty dope.
Well, that's uh that message right there is uh the message that we we every week.
Prove it or you're going to be stuck competing on price. And uh so anyway,
thank you to our sponsors. Uh Rand wanted to make sure that we knew we were
late. Thank you, Ran. [laughter]
Oh man. So today's topic just kind of kick things off. Um
the most expensive mistakes aren't always installation. Now
I would even add that it's not always in, you know, an installation error or whatever. It's like if you're an
installer, some of the most expensive mistakes you can make are with your finances. Uh but the lack of planning
and plan and and sometimes I know that the stores you may work for
uh that is partly their fault but the lack of planning can cause more
headaches cost more money than just you know an installation error. Uh
obviously those can be quite expensive. Um, but you know, lack of planning and
putting the wrong flooring in, you may install it perfectly. But if it's the
[music] doesn't matter, right? It doesn't matter that you laid the wrong product
perfectly in the wrong room. Um, so that's one thing that comes to mind.
What do you guys uh we can always delve into the financial
side of things as well, but what's what's your guys' take? Um so, well, you kind of just said it
right right away when it came down to planning, right? because there's so much that could be blanketed underneath that
label. Whether it's planning the right people, planning the right dates, uh
getting your schedule in order, um
just planning period. I I I I can elaborate on that at every aspect of a
project that it it'll hurt your gut if you're not ready for it. Well, well,
let's bounce that back and forth a little bit. One thing you said, the
right people, right? So, knowing your your crews capabilities
and your new crews that you may hire capabilities and making sure you have
the right people on the right job. That's a big piece of of from a flooring
contractor's perspective of doing of like proper planning on the installer
side. When when I installed subcontract, it was about taking on the work that I
was competent in taking and not just take and I'm guilty as charged. Oh, we
all taking on work I should not have taken on because I that was outside my skill
set. But man, those dollar figures will get you guys. And you start to think,
but not very often did I extend myself beyond my abilities that it turned out
well. It just did. I mean, yeah, sometimes I didn't get paid at all.
Sometimes it was, you know, uh you got paid but you go back 50 times to take
care of problems or issues or whatever and you end up not making any money like
taking on those those projects that are either beyond your your skill set or I
would also say what too far below your skill set where you know the whoever the
whether it's contractor homeowner or whatever doesn't value the level of quality that's needed. You know, I think
a lot not I don't not really crapping on backsplashes, but like
outside of uh backsplash, you know, a countertop not being uh level or the the
uh uppers not being right, you know, um
or square to the bottom uh cabinets. I mean, for the most part, you know, you
can't it it's it's not that hard to put up a 3x6 on a backsplash. Now, you can
get fancy, start doing mosaics, and I know plenty of backsplashes that get very complicated and are tough. But my
point is, if you're a really really good guy and you're going putting in a 3x6
backsplash, I mean, you're you're competing with, you know, a ton of people and you may do
it perfectly, but you may not make no money. Um, and not making money is
expensive. You got to make money in your business. You got to make money in your your
installation business. You got to make money in your flooring business. I hear
I hear this fight which I wish wasn't there. this fight that
where come and it comes from both sides, but installers for some reason don't
think you should not installers in general, but I know installers that don't think that the store should make
any money on their labor. Well, if you want to take the risk of that homeowner
not paying or take the risk of the GC not paying or it
taking 350 days to get paid or any of that risk that comes along with payment
or some of these installers just not going back to fix a punch list or something.
Yeah, we have one of our past subs, man. we've had real problems
with him getting back to to work, like just refusing. Um, and you know, we're
the ones as the company that still has to take care of that. So, there are
plenty of reasons a store should make profit on their labor. That doesn't mean
that the labor shouldn't make as much as the market allows, but to to have this
idea that a a shop shouldn't make money on the labor is kind of ridiculous. Um,
where did that idea come from? I've just heard it from multiple installers and um some that you know
very very well. I'll leave it at that. So, Gotcha. Um,
and then from the stores perspective, they're always trying to drive down labor. And my story to that is labor is
not a cost to suppress. It is a resource to invest
period. Like that may mean investing in their capabilities like you
know maybe not paying for the training necessarily because they are subs but
work with the the uh manufacturers and suppliers and distributors about making
training in your area happen. make make sure that there's trainings going on in
your area and that you're communicating as a store to your installers and that you're encouraging them and supporting
them in like not costing them work, maybe moving a job a day or two so they
can make it to these trainings. Um, that is supporting and investing in in your
your labor resources if you have subs. If you have installers W2, you should
be, you know, getting them to different trainings and certifications and
supporting them, uh, you know, of course, it's then it's your responsibility to, uh, to make that
happen. And we get it. We do it. You know, I've got plenty of guys that are certified in multiple different
floorings because we pay to pay them their time when they're there. We pay them to go there. we pay them, you know,
they come back and they always want more money for getting the certification. So, it seems to be that part, too. So, like
there's certainly um I think a
misnomer, if that's the right word to use, on both sides like it's not
something I think that the store should make profit, but they should not suppress labor. And both of those things
are possible. They're not mutually exclusive. So that was a little rabbit
hole, but all in all, having the right right guys on the job, but I was going to bring up
what do you think about the right equipment? Guys taking jobs ain't got the equipment to do.
No demo machines. Yeah, renting that stuff can get expensive quick.
Yeah, I we we've been caught with um okay, when we first started out, we knew
that we had a lack of equipment when we were first starting, right? But so we did put ourselves in a situation where
we took a project understanding that we were putting ourselves in a bad spot, but we were
trying to build for something. So there's there's that. Now we are very proactive. We try to
have all of the equipment for every possible project that could come our way
as long as we know that it's going to benefit us. Now, sometimes
sometimes that tool or that equipment is going to get used once or twice a year, which kind of sucks, but when you do
have it, it's worth its weight in gold. Um,
however, I'm not going to go and tell someone that I'm gonna be putting
some large format tile 20 feet up above a window and and doing that kind like I'm not
going to be doing that kind of work. That's for sure. Uh, like outside of my outside of my my comfort
zone. I think another um you know thing is
safety and like work comp claims that's one thing I
tell you what that is an expensive ordeal.
So having the right insurance to cover you, that is probably one of
the big things I'll tell you. Getting an uh if you're, you know, in the business,
getting an errors and emissions uh piece in your insurance is another
one uh that you might look into, talk to your insurance agent about. Um,
some of them will cover like improperly installed floor not like more so like
the wrong pattern or the wrong not that the installation failed but the wrong
product in the wrong room, the wrong pattern, that kind of stuff.
Uh, it can cover some of those mistakes. Um, of course you always end up paying
for it in premiums, guys. I mean, insurance companies, you know, they are
not sponsoring every PGA Tour event on the planet because they don't make money,
you know, they they're not doing it for practice. They're not doing it for practice. They make plenty of that that gus, as my
uncle would say. And says that one of the biggest mistakes he
made was when he signed a contract for several big apartment buildings. He went to start the project and everyone that
he had contact with uh didn't work for that that company anymore. So nothing
was written in the contract the way that it was when he first signed it. So he pulled off and was like, I'm just not
doing this. found out later that, you know, that company went bankrupt and
no one got paid on that job. That's happened to us on a project before when we were labor only.
We had a job. I think uh that is really good that Ran brought that up because
that is reading your contracts and understanding your scope. Um, the part that we we have
a a new client pre-qualification form for new GC's.
Uh, it's typically because you're you like I I've got to jump off here to finish up a pre-quall for a GC on me.
I don't send our new client application form to the, you know, the Walshes of
the world or the McCarthy's of the world, like, you know, the the big big
big ones, the Fortune 500 types. Yeah. But smaller GCs that I don't know
or coming out of town, you we we definitely have them fill out
a a new client pre-qualification. Great idea. And we have two of them right here. The questions that we ask is, have you
secure have you do you have proof of secured funds? And that whole thing
happened because we had a contractor, a good contractor of ours do a job, but
they didn't have the money to pay. And then nobody got paid. And then they got
I can't I don't think I'm allowed to really state who the company was, but they ended up getting the feds on them
for for for some stuff. And long story short, it took three years to get paid
on that job. And eventually they were able to liquidate all their assets and pay the the GC's
uh and then the GC was able to pay us. But it took three years. And
that was a I mean even if we made profit,
even though we made profit on the job, we didn't make any money. years financing something like that for three
years. Doesn't matter, right? Uh I'll tell you another spend chasing
the money. Well, yeah. just I we look at things like if we're we're loaning the money to
them because if I have to get into our line of credit to cover costs and it
doesn't mean that that job caused me to do it, but it's still just I calculate
it like what is it cost me to borrow money and if I had to borrow that amount of money then that's the value that I'm
losing every month that I'm not collecting on that And [clears throat]
so that's how we look at it. And three years,
[snorts] 18% a month on a pretty pretty good sized invoice, you know.
That's crazy. Plus inflation, right? That dollar amount no longer holds the value. Yeah. Three years later, that the cost
of bread didn't go down and gasoline didn't go down. And this has been a while back, but that's
why we created that. And sometimes we'll send it to some of our other cont even our good contractors as a project
pre-qualification because we want to know um that they've secured funds. So obviously
that's kind of what Rand's speaking to there is like there's bad general
contractors, bad builders out in the world uh that will take the money and
run. They'll get the initial financing from the bank and bounce and
and and you just gota be careful who you work for. You know, there's also the good ones who just
always use like some little excuse about, oh, we missed it by one day, so you have to wait till the next pay
period. And and it is your fault, though. Yeah. Sometimes it is, sometimes it is.
There's plenty of those. you like the ones that'll push it, but at the same time I can at least kind of understand
it because you know they have a bill date too that they have to right,
you know, have their um because all you're doing is turning in your bill to them and then they're turn
they're packaging all your bills and then turning that into the architect. Yeah. So typically making sure Yes. This
is the percent complete. Yeah. or to the bank or to whoever's going to approve the thing,
but typically you send it in on a given date. The most popular for us is in this
area is the 20th. And then they have 5 days to get their
all their subs assembled and put their general conditions on it and submit the
complete pay application to the a lot of times it's the architect
and then they are a net 30 in a perfect world.
And for all you that don't think that companies should make money on labor, here's an example of very standard. This
is very standard. Uh so they have five days to get theirs in. So now you're 5
days into your time frame. Then they send it in. They're at net 30.
So now you're 35 days. And then if they get paid in 30 days, which never
happens, uh it's usually, you know, in the 40 to 45. So let's say it's 40. Now you're
I mean, you can see how this builds up. And then on top of that, once they receive payment, they have seven days to
make payment to you. So that's how it uh that's how it goes.
What's up, Mr. Ro? All right. Well, everybody, I got to run. As I said, I do have to jump off
here and and finish up a a big pre-quall for one of our projects and a couple
other things going on. Um, I will see you guys next week. And don't forget
about convention coming up, Synergy Convention in in uh Chattanooga
and we'll be there. You can also come see us at Ty in February, very first weekend or
week of February, I believe it is. It's weird now saying January, isn't it? I know. I almost said January.
So, yeah. Make sure you get out to convention. Uh we're going to be doing a pre-convention show. I'm going to work
with the team here to find out the the right uh the right timing for the
podcast. But we'd love to have all the CFI folks, all FCICA folks, as well as
any installers that are going to go uh to get on and talk about the show. So,
uh keep your uh keep your look on your emails and and uh stay in touch. We will
be uh announcing that here in the near future. Thank you guys. Have a great rest of the
podcast. All right, brother. Thanks. Have fun.
All right, now that we got rid of that dude, let's uh [laughter]
[sighs] So, so, um, they aren't installation mistakes,
right? However, there there's a lot of mistakes that that happen when when you're going through the learning curve
of either being an installation only or having a flooring business. Um, and
I would say just not being prepared, not knowing. That's that's going to be the most
costly mistake no matter what stage you're in. Um, I think
we didn't really have a lot of people to ask questions to, Daniel. So, it was it was hard. It was kind of a Oh,
mess that one up. Uh, let's try again. Oh, I guess that's not the right way.
Uh, let's try again. Um, so I guess some some of the mistakes
were through trial and error on our behalf that we
lost money at the time but gained information and knowledge in the long run. So
was it a mistake or was it a learning moment? Right. Well, it's only a mistake if you don't
learn, right? You either Yeah. you don't you don't lose
learn hopefully. [snorts] Um
some of the things that I can think of that that we've encountered is
saying yes too much, not learning how to say no sooner.
Um and then also understanding when to walk away from people we were working
with um companies that we were working with. That that was uh
pretty expensive mistakes there I would say but we still learned from them. So
it's kind of hard to say it was a mistake then. Right. Um I mean it's just what made us tighten up
what we were doing, right? Like we were talking about that contract and then how they went bankrupt, you know, with
Rollins and us being on a project like that and the the horrible thing about
that one is we were labor only. There was no way we would have an idea, right? The the people that we were working for
already knew and they were continuing to have us do all this extra work. And I was just um I think it was Mike was in
here uh a couple weeks ago and I was showing him I still got the paperwork. I said, "This is stuff that we never got
paid for." It was like 200 hours of labor. Yeah. 236 hours, I think.
It It was, you know, that and then them getting our bills and just saying not paying that.
Yep. So, Rod says that small mistakes are great teaching opportunities.
The big work you have, the big work is hard to avoid. big one.
Yeah. Yeah. Big mistakes are hard to avoid. Yeah.
And it is it's that's where you get, you know, the small mistakes. Many small
time make big time. Yeah. As far as like
big mistakes, I don't know, missing a spec or missing
a change. And and we know what we talked about this morning in our meeting. Yeah, it's it's we talked about this stuff
this morning, right? All it takes is missing a switch on a a bulletin that came out way after the bid. I mean,
materials ordered, then a bulletin comes out and you don't catch something or
like you said, like sometimes they'll email you something and it's the same exact print and then it's like, "What's
changed, guys?" And then you have to ask them questions and it's like, "Oh, so you sent me the the same one again." So, if I would have said, "No, nothing
changes." is then it would have been my fault. And that's where and you know, as a
matter of fact, I called them today on the windshield time and Chad is said, "Look, be prepared for some dumb
questions to come through and I'm probably going to call um if I'm on the road." And he was like, "Oh, there's no
such thing as a dumb question." I'm like, "Okay, first off, yeah, there there is a such thing as a dumb question. Uh two is is, you know, I'm
still trying to learn our CRM. I'm still trying to do a couple things and I just want to make sure that I'm submitting
everything that's acceptable for you guys. Um, and he was very appreciative
of that. And I'm like, plus I turn in all these submitts, dude. And I keep getting alerts on my emails that tell me
that they're late. Like, how can I fix that? Because I'm that type of person that don't like all the notifications on
my phone and I have to have them cleared. He just started laughing. Exact opposite.
Yeah. [laughter] He just started laughing. He was like, "We'll take care of it. I just I just don't want to miss
anything." You know, it's uh I don't want to say it's a very large job, but
it's not a small project. It's big enough. Yeah. That's where, you know, Rod says you So,
he says you want to avoid the big ones. Sorry about the typos, but yeah, it's the small mistakes are
great teaching opportunities. The big ones you want to avoid.
And you know, and with our crew, we have our Monday meetings and we do try to talk about a
lot of that. And and I think today I explained it to them that
they are our last defense on losing for wrong product, wrong information,
misinformation. The same way that we are the last uh defense for a project. If us
as the flooring installers do something that looks bad, everything gets picked apart.
So, we trust them to go out and pick our paperwork apart, pick everything apart,
let us know if we missed something or if you don't understand something because maybe we did miss something, but we just
don't assume and fly by the seat of our pants and just
get stuck in that autopilot. And that's that's also can be a very costly
mistake. And that is kind of on the installation side, but that's the
planning part. If you don't talk about it, people don't think about it. If people don't think about it, then they
have a reason not to implement, not to look for. Uh,
and it's going to keep happening. I know it is. It doesn't matter how thorough you are going to miss something like that. Uh, but communication, and I know
we say it all the time, communication is very, very important. Right. Because
Rin is kind of talking about that, right? What do we put in place to help avoid these mistakes? And you kind of
it's that communication piece, putting everything down. Um
I think like with us, um we use Microsoft Teams to track each
project and then each project is tracked only in that project. And I know Trade Tech, you know, does the same thing
where if you're on that project, everything is tracked per that project.
And we started we started to just let all the guys know
especially it's like everything has to go through these channels. Like don't
text me a question. And if you do text me a question, it's that like if I'm not
answering on Teams, it's hey, I put something in Teams. Will you go check it out?
Yes. That and then the whole phone calls too. It's like I'm I was talking so
just something simple, right? Where I'm looking at different um
different business phone plans right now and earlier I'm talking to one of the
the carriers and she's like going through everything with me. And I said, "You can tell me as much as you want
right now, but it doesn't matter because I'm I just need an email with all this stuff in it because everything needs to
be tracked, right?" And it's one of those things, too. You get it in writing. You can go back and
refer to it. You don't miss it. Um, you know, you had mentioned about teams
and trying to track and and that's one of the things that we have in place, Rand. Uh, and I old school, so I was
kind of against it at first, like, dude, why do I got to put it in an app when I can just text you? Um, but now it's
like, well, did you put it in Teams? Right. It It was like that, but then
there was a point where it's like, didn't I text you? Was it email? How do
I even communicate with you? Yeah. But was it email? Was it text
message? Was it a group text? Now it's all in one place for everybody to reference
from start to finish. Rod says the biggest mistake is letting
someone else control your fate. Staying engaged is the better choice. And he
also says that uh their senior managers review every contract and every purchase
order issued. And I think talking with um
with Paul, he's the same way, right? He's like, I'm gonna review everything that that comes through, which is
awesome that it's just another set of eyes, right, to see, hey, did I miss anything?
Yeah, 100%. And you know, I it does seem like a lengthy process, but once you start getting to the point where you
have um an extensive team and you start
operating on volume, you start getting all these projects and getting them crossed and mixed. It is
not a jab to have someone overlook what you've done.
You know, you might miss something on a Friday afternoon that you're not going to miss on a Tuesday afternoon, right?
You might It's two o'clock. Oh, man. I gota like Paul. Hey, I gotta go, guys. I got I got a bid that's due, right? I
gotta go. You're in a hurry. You're gonna skim through it and be like, "Ah, yeah, that's good enough." You'll miss
something. I go through things that I just did a week ago. I'm like, "Ah, man. I missed that."
I remember one time I missed and it cost us and the guy didn't want to work with us. Cost us some money. I miss labor on
like 10,000 square feet of some removal of adhesive and
and he was basically like uh that's your fault not mine. And then again,
that's where uh looking at
looking at things from a different perspective sometimes because later on
he missed some stuff on a job we were on and it's like I'm
charging you for it anyways. It's not my fault that you missed it.
Yeah. And that was you bring up back that situation, right? And there's no argument after that.
Well, there's still they still argue, but there's still an argument, right? But the fact that I saved all the
information and brought that back full circle a few years later to the owner of
the company in front of the helm. Yeah. I mean,
and talking about losing money, there's been and Paul's pre-quall is great, right?
Because you talk about and we talk about like these out of state contractors all the time and it's like
some of these projects look all right, but if you don't have you don't do your
due diligence and stuff. I mean, we've showed up to projects and it's the middle of winter and they're like, "Oh
yeah, you need to do install these bathrooms with sheet vinyl and flash coat." And it's like, "Dude, this slab
is 40°." And then the crazy thing is is that this dude contacted me again like a year
later and the name rung a bell. So I'm searching for it. I said, "Yeah, didn't
you try to get us to do these stores that were super cold and you told us to do it anyways and we walked off your
job?" He was like, "Dang, you guys still remember that?" I said, "Yeah."
Say no names though. I already know what story. I already know the story because I went
back and took a picture of the the bathroom a couple years later.
Somebody got paid for that. And that's uh
Go ahead. And it's just these things a lot a lot of times on this side um
especially when you're talking installers, it's things that they don't think about or they don't necessarily
need to think about, right? when you're losing money when it's not
on that that installation side. You know, some of it is um it just made
me think about it and I know we probably talked about this before. It's all those little nickel and dime things
that you constantly lose on where someone leaves a battery at a job site.
someone, you know, something on on on some equipment
breaks, they don't say nothing until you go to grab it again for the next job. Failure.
Yeah. Um just the vehicle break. They'll be like, "Well, the van's not
starting." Well, what's going on? Yeah, it started doing this like three months ago. And it's the first time you're
saying something and you're talking like
like we set the the expectations and a good one was last week on that project
where the GC is like, "Hey, you guys have to remove these rooms right here too, right?" And then the guys are like,
"Let me just make a call because he's explicitly told me not to." And he kept
the GC kept on just chiming in, chiming in. Nope, no, you're supposed to do this. Like, just do it real quick.
It's like, yep, not going to do it. So, it was not on the original paperwork. It
was those numbers were never in there. It was supposed to be excluded and now you want us to do it. So, where do we
where do we go? Change order. [clears throat] You know what? And and kudos to the guys uh for stepping away, right? Like I know
they were getting frustrated. They stepped away outside of the building. They called me. I talked to him about it
and I just said, "Give him my phone number. Have him give me a call direct."
And uh and and he did. And then he's like, "Oh, oh, hi, Jose." "Yeah, yeah, I
remember you." And I'm like, "Hey, this we're already done with what we were
hired to do. Now, if you and somebody else walked through and they missed something and that information got passed on to us, I can assure you that
we didn't include that." So, and then he was like, "All right, give me a minute." He called me back
like two minutes later. I was like, "All right, we know it's going to cost extra, but I talked to the owner. She said,
"Okay." And I was like, "All right, cool. But what I'm going to do is I'm going to contact the guy who hired me.
I'm going to let him know. That way, he can call you or the owner, and you guys can chat, and I'll wait for him to give
me an approval." He was like, "Oh, you going to do that right now?" I said, "Yep, I'll do it right now."
And within 10 minutes, it was all said and done. instead of arguing with the guys on site for 15 minutes. And
that's the kind of thing that would have cost us money.
But I'm glad that our guys are on our side and and that's a great example of
uh teamwork, making the dream work and and not putting us in a bad situation because who knows, maybe we would have
tore it up. He would have been like, "Oh, no, not that room. I didn't tell you that room. We've been on that side, too.
Yep. Where? Oh, I thought it was the same material, so we just ripped everything
up. And it's like, man, there's paperwork for a reason, which is kind of
leads us right into this question right here by Rod is how do we make hourly installers maintain the labor budget?
And it's that communication piece, getting everything on work orders. He's he's saying that
that's where um they they lose they often lose, right? So it's
that's what our typical weekly meeting. Um so that's part of it,
right? We're talking what happened last week, the good, the bad, what's
happening this week. So that way everyone has a heads up on what's going on. And that's where these these
conversations come in, right? And don't get me wrong, sometimes it's some of these labor budgets is the estimating.
And um that's kind of where it sucks being from the labor side and being
like, well, I know that if I were to go to do this, it should take this long, so I'll
allocate this much time. Then it's like, all right, it should take three days. And then you're there 8 days later and
it's like, "All right, we're about to wrap up." And and and we have conversations, too.
And to build off of what you asked, Rod, it's it's hard when you have installers with all different capabilities, but if
they were to all go do the same exact cookie cutter project, right, you're
going to get different speeds, different results, and that's hard to to factor.
the the only thing that we can do to kind of combat consistently losing at every project is
to do our best to put the right people there
right away the first time. And if we're in a position to where we can't,
then we look at it as an opportunity to trust someone else to better their their
skill set. Um, and sometimes it works, sometimes it doesn't, but it also helps bring
perspective to uh the team out there in the field as to what they need work on.
And some are hungry, want to learn more, some some don't. Um, either way it goes, we all learn
from each other and and try to build off of that. But
if how do I how do I put this without like you know putting people in a bad
spot or talking like like I'm talking crap about people because that's not what it is. It's
when you start in this industry under a certain label or working with certain types of uh other installers or crews
that kind of gives you the mindset moving forward, right? But if you are
only been hourly your whole life and you come in and that's saying everybody but
the majority of people who have been hourly in this industry from day one, they don't understand what goes in to
being profitable on the labor side. It's very hard to be consistently profitable
on the labor side unless you're a go-getter, unless you understand processes and getting things done right
the first time and you're open to criticism. So,
it's hard to to to maintain a consistent profit line, right? Is everything's going like
this with the labor. All depends on the season and who's got diarrhea that day.
or every day. But yeah, it's it's that that rework
that we're probably talking about. Well, I I guess I don't know cuz sometimes
it's rework, sometimes it's just this job is taking a ridiculous amount of time.
But I see like
Some people just aren't meant to be leaders and you have to put
kind of them in their place, right? Because it's it's nice that you that you want to be there, but it's like if
you're constantly coming in here and just fingerpointing and it's always someone else's fault, that ain't it. And
I mean, a a big thanks to you right there because
early on you you showed me that no, like this is my crew. Like I'm in charge of
this. If anything goes wrong, that's my fault. Yep. And
been put in position positions to to sit there and just take it from people even
though it wasn't me. But it's all right. It's a it's part of what I signed up for
and I understood that. Um and but I will I will always go out to bat for the guys
no matter no matter what. I'll always go
our guys. I will have your back 100% all the time. Even if it is our mistake, I will own our mistakes and I won't be
able to talk that away.
But I I will I will put us in a position to where we make mistakes, but we still
have have a level of respect and and professionalism that that should go both
ways and let's try to maintain relationships and and keep them going healthy. But if we made a mistake, hey,
yep, we messed it up. We're going to fix it. Okay. But now what? Now what do you want to talk about? We've already gotten
past that.
And um you know what I will say that is another um mistake for for some of the the young
cats or people who are a little uh who aren't very outgoing and and uh
non-combative is it is okay to voice your opinion and to
and to bring up situations and scenarios that you're not comfortable with.
That is 100% okay. What you don't want to do is always be the one
taking it from everyone and just kind of bottling that up. Uh uh as a flooring
installer, you you're going to want to sit in a meeting, speak your peace, say, "This is what I need. This is what we're
willing to work with. This is what can be done or what can't be done." Um, if you're willing to sit in a
meeting and do all that, it will help you become more profitable through
a long project or even through a longer relationship. So I will say that an
expensive mistake is not knowing or understanding the value
that that your knowledge brings to the table when you are planning with others
that aren't part of your team, but you're going to become part of their team for one project or many projects.
And that's one of the reasons why we call our subcontractors partners, right? is
because it's it's a partnership. I'm not and we do this because we've been on that other side where they treat us as
lower than them. It's oh, I'm not. And I'm being honest, there's been companies
that we worked for, one in particular, where like all the time it was you send an invoice, they don't say nothing. They
send a check with an invoice with line items crossed out like not paying you for this, not paying you for this. Like
one of them was bass. Like what do you mean you're not paying me for bass? We
literally did this project. There's bass included.
Yeah, that was part of the scope. That was included in the square foot
price. Even though we separate everything out, Rod says we have to remove the hurdles
to help them succeed 100%. And sometimes uh you learn that a really elaborate
Excel spreadsheet is one of those hurdles. [laughter]
Hey, I did pretty good on mine for not knowing Excel and having to go down that rabbit hole and learning how to do
everything that I did. That was pretty good. Very complicated, but pretty good.
Having the right team leader on the job is a big key. How do you
as people that price jobs, who do you keep from coming in too low for your
margins?
Who do you keep from coming in too low or how do you keep I think that says how do we keep from coming in too low for
your margins? Well, that's where it's a gamble, right?
So, what I've done and what I've learned and what it for, look, let's just go back. There was a company I worked for,
we Daniel and I both worked for him years ago that would do a project and then they would have an amount of labor
hours allocated for that project, right? And I'm a competitor.
If this is a project and they had 400 hours on there for this project,
uh, and I know that I'm gonna consistently have a crew of four or five,
I was always trying to save them 100 hours. And that's just me, right? Not everybody's like that. I get it. Um, but
but that little piece right there is where looking at it from the installation
perspective. This is how long it should take. This is, you know, throwing a little variable in there of the unknowns
and then divide it by a dollar amount that you think or, you know, you need to make per hour per person for you not to
be in the red. Uh, and and that's the kind of the goal that I shoot for. Um,
now is there going to be profit markup on it? Yeah, I I have to, right? You gota you got to factor all that in. But
that is kind of where I try to get the baseline for me. And Daniel might do it differently, too. We all we all have our
little, you know, things that that we do, but um I know if I average under x
amount of dollars after employee match and all that, we're losing. If I can
average over x amount of dollars um consistently, I I'm doing all right.
Um smaller jobs, very hard, very very hard to uh
That's what I was going to bring up too, right? cuz there's been a few times where we've brought up price sheets and
that's where I told like people be like email us, hey, how much a square foot to do this many square foot of this
material. Sorry, man. I need to look at your project because this is I'm not just
going to throw a number out there. I said I would I can give you like a budget amount about what it would cost, but I'm not going to be like, "Yeah,
we'll do this for x amount per square foot per square yard."
So, I got a phone call today and this is where Paul's little uh pre-quall
like like dang that's a good idea. But what you just said is that it's 500
square feet of a a certain manufacturer
in Detroit. He was like, "Can you give me what would you charge to install?" I said, "Well,
what's the layout?" "Well, I don't have that yet. You know, they're occupied right now, and this is going to be a
remodel." He says, "But it's roughly a 10 by 40, and this is going to be a
cooking line and this and that." And I was like, "How many drains? How many this? How many that? What type of system
are they using?" He was like, "I don't know." I was like, "Well, I need to know all that. I can't just give you a budget number and give you a number." He was
like, "Well, I I don't really know." I said, "All right, 25 $25 a square foot." He was
like, "For labor only?" I was like, "You just told me to go high, so I went high." He was like, "Uh, that I don't I
said, now you understand why I need more information. I'm gonna protect myself
and I'm gonna make sure that I'm covered. But if me protecting myself puts you in a situation to where you're
going to lose negotiated work or a bid, then this is the information that I
need. And he's like, "Okay, okay, I understand." So, I got his information. I'm going to email him a list of
questions. Hopefully, he can answer them. If not, then we'll put some protection numbers in there.
They're going to be in there anyway. Can always say no, too, right? That's where you come in and say you never lost
a dollar on a job I didn't take. Well, the problem is that the manufacturer gave him our phone number.
Yeah. But still. Yeah. And at the same time, Rin, to to go with
your question, right, for me, it's, you know, people come back and they're trying to haggle with you and I
just tell them, look, man, the the price is the price. Like, if I was if I thought I could go
lower already, I would have when I'm going in like,
are there ways where you can save some cost? Absolutely. But you wanted this material with us
installing it. That's the price. If you want to cut down on your material budget, we can look into alternatives,
but the price is the price. Yep.
Rod says, "It's unfortunate that a lot of independent installers don't understand what their fixed overhead is,
so they typically underpric the work or just depend on the market to set the price with no regard for profit
margins." And that's where again, I'll shout out um Kyle for always saying, you know, profit is not a dirty word.
It's that's what we're all in here for. And go to go back to your point when you were talking about um trying to
undercut those labor numbers that they set out for you, right? Because you're competitive. It's you understand that in
order for you to make more money, the company needs to make more money. So the more money you can make them, the more
money you can make. It's it has to go like that. It's not a matter of
I'm already not making you money, but I want more money. It it just don't work.
Yeah. It it just Yeah. And and to bring that part of the conversation full circle is I was the installer who wrote
everything that I installed down. I kept track of square footage, yardage, um, and what I would have charged if it was
me doing the not by the hour. Um, and then I also tracked how many hours I
saved them on each project, how many under hours I was on certain projects, how many over hours I was on certain
projects, and then I gave an explanation as why I was under, why I was over. And
I did that for a couple years of gathering information. And when I went in and asked for for a raise and some
more vacation time and you know potentially a position in the office like they had promised years
before, the answer was no.
And that's that's when this all started.
But so I mean we we're up at about time. Yeah, we're at time right now. So,
I think it's a good place to wrap up. We do want to thank all the sponsors. You can see them up at the top there. I do
want to shout out um a couple things real quick before we take off. Uh NFCT
has some uh classes here in Calhoun that
are coming up September and October. Uh this QR code to take you to their events
page so you can check those out. Make sure you get uh signed up for some resilient and insulation and subfloor
prep. And then they have a moisture testing um coming up in October. So if
you're interested in that, make sure you get there. And then also we got like we
were talking about earlier the synergy convention and expo. Um
it's it used to be CFI convention, right? But now it's expanded. Um, we got, you know,
multiple people going to be there now. It's not just, you know, one entity. So,
we got CFI, um, FCICA, FCITS.
It's it's going to be it's going to be nice. Make sure you get signed up. Go. Um,
if you've never been, make sure uh you just I think there's
always someone there that's always looking for someone new so that way they can kind of bring you in. Um,
if not, if you find one of us, just reach out to us and we'll we'll make sure that you get in there and uh start
introducing you to people, put you on the spot, right? And once again, Pro Installer
Magazine. Make sure you check them out, man. They got some good stuff uh in their most recent uh catalog. So, go in
there and learn some stuff. And if you want to write them, I'm sure
their information is in there. They're always looking for some some more knowledge. They can never have enough content for
articles, guys. Uh Rollins says, "You got to go see Rod.
I was going to try to make something up, but I can't think that fast right now.
But we appreciate you guys and uh we'll catch you on the next one. Make sure you're liking and subscribing.
