Contractor Business Know-How

Craftsmanship is what attracts many to a career installing real wood floors. It’s the ability to leave behind a work of art that stays with a home or business for a long time.

Some of the fundamentals that lead up to a masterpiece floor – hiring good team members, connecting with customers, and balancing the books – may be the less “fun” part of the job, depending on who you ask.

Whether you are just getting started or are an industry veteran, read on for tips from fellow wood flooring professionals about making your business run even more smoothly.

FINANCES
One of the most important aspects of running a successful business is managing cash flow effectively. Software programs and outside help can make the process easier.

“We use QuickBooks in our office to manage our finances. It’s user-friendly, and it puts relevant, useful information regarding our company’s financial picture right at our fingertips,” says Jason Carter, President/CEO of Carter Quality Hardwood Flooring in Oxford, Michigan.

“While we handle most things in-house, we outsource payroll and tax services to an accountant’s office. This frees up time and resources for other aspects of business management. More importantly, the cost of an error with payroll and tax filings can be more than the yearly cost of hiring an accountancy professional.”

Travis Fritzel, above, owner/operator of Perennial Hardwood in Fort
Collins, Colorado

Travis Fritzel, Owner/Operator of Perennial Hardwood in Fort Collins, Colorado, agrees about using professional services, and notes there are plenty of affordable options to manage cash flow and understand where money is going.

“I enjoy using QuickBooks Online to manage job expenses, cut down on waste, and get an idea of what profit is truly made on any one job,” says Fritzel. “I attempted to run workman’s comp, FICA taxes, and clocking hours all myself and quickly learned letting a professional payroll company manage all of that ensured I never owed unexpected taxes or fees.”

For saving, Fritzel puts back 5 percent of every job for down months, tool repairs, or future equipment. “If you feel comfortable saving, I recommend getting a business credit card and paying it off every month to enjoy a 2 to 3 percent cashback as free money,” says Fritzel. Carter adds that having enough cash-on-hand is key. “The old saying, ‘have enough cash for ‘X’ number of months’ is true,” he says. “What occurred with this pandemic can easily happen again, so it’s important to be prepared.”

HIRING AND RETAINING TALENT
According to the Hardwood Floors magazine 2020 Industry Outlook, 66 percent of contractors surveyed were struggling to find adequate skilled labor. These shortages are not unique to the wood flooring industry. The Home Improvement Research Institute found 72 percent of survey respondents felt there is a shortage of skilled labor throughout the construction industry in the U.S. Of course, this was all prior to the COVID 19 pandemic. With the new challenges in mind, how can one go about finding and retaining good employees?

Kyle Neuroh, Owner of Neuroh Hardwood in
Nashville, Tennessee

“The ‘Golden Rule’ applies here. Treat your workers well and show appreciation and you will usually be rewarded with the same,” advises Kyle Neuroh, Owner of Neuroh Hardwood in Nashville, Tennessee. “Communication is key to any relationship inside or out of the workplace.”

Bryan Park, Owner/Founder of Footprints Floors in Lone Tree, Colorado, notes that when hiring crews, having really high expectations right off the bat can create a problem.

“You can’t bring on a new person and immediately expect these high standards because they’ll fail, you’ll fire them, and then you have to find new help,” explains Park. “It’s bringing people on fully anticipating that they’re going to do C+ or B- work, and now it’s your job to extend grace and manage them into what you want them to be. That’s a long process. It could take years to get them where you want them to be. But, holding them to standards they’re not capable of filling either means you need to hire that perfect person upfront – which is expensive and hard to find – or you’ve got to find an average person you can manage into who you want them to be.”

In general, Carter has found it’s more beneficial to hire a candidate based on personality traits, as opposed to trying to find the candidate with the highest skill level.

“Obviously, skill is an important factor, but the right candidate will be trainable,” adds Carter. “There are certain negative personality traits that can’t be trained away, and the end result is toxic for the entire team.”

Carter also recommends putting employees first and customers second because he believes the best way to end up with happy customers is to start with happy employees.

Jason Carter, center, recommends putting employees first and customers second because he believes the best way to end up with happy customers is to start with happy employees. He’s seen here with the Carter Quality Hardwood Flooring team.

CUSTOMER CONNECTIONS
For building and maintaining a strong customer base, Neuroh depends on happy clientele for future references – and social media.

“Nothing closes a sale like being referred by a client’s friend or relative you’ve done work for in the past,” offers Neuroh. “Social media like Instagram is especially helpful in letting potential clients see past work, and having frequent reminders of your company should an opportunity to refer you come up. NextDoor is also a great platform for us, as it lets neighbors share and refer amongst themselves about their experience.”

Fritzel says image is everything. “Your first impression, the professionalism of your estimates, communication, and punctuality all determine a client’s expectations of your company well before they see any of your work,” he explains. “By managing your client’s expectations so that you will always exceed them, and delivering on your word, you can start to develop a reputation that will lead to more referrals and long-term clients.”

Park thinks it can be an entirely different experience for the homeowner when they have a contractor who genuinely cares for them. “You can’t remove people from business at all. Life is people. Life is interacting. Life isn’t spent trying to avoid interruptions; interruptions are life. Embrace people, customers, and personalities and push in and care for them,” he says.

“It’s the basics like utilizing technology, marketing, calling people back, showing up on time, putting customers first, putting other people first, and treating your crews like you’d like to be treated.”

MARKETING
According to BrightLocal, more than 60 percent of consumers surveyed have recommended a local business to someone they know by word-of-mouth. However, strategic marketing across multiple platforms really can bump a business to the top of the list. For many contractors, maintaining a robust online presence is vital.

“We have employees in-house who have strong marketing and advertising experience, so it’s not necessary for us to outsource those services,” notes Carter. “Additionally, community involvement and charitable contributions go a long way in establishing a strong community presence. Not to mention, giving back when you can is just the right thing to do.”

Neuroh is hands-on with his company’s marketing, though he does outsource some web development and design.

“I feel that having a stellar website along with an active social media presence is necessary in today’s economy,” he says. “Social media is free, but it does require time to learn how to create good content.”

To take social media a step further, Fritzel says a Google listing, Facebook page, professional website, and Instagram all can be maintained very affordably. He notes that clients want to see reviews, photos of past work, and information about your company.

“Once built, it does not take more than an hour a week to keep all of these pages updated,” he explains. “During down months or the offseason, you may boost your website through services like Google or Yelp. In previous years, we have contracted a job for every $60 spent on AdWords. Currently, we focus on our blog, Instagram, and Facebook page to help generate leads without spending any money, but running ads is a great way to make sure you stay booked out to capacity.”

GROWTH
Park started Footprints Floors with his wife in the midst of the 2008 recession, but within six months, he had five crews working full-time. Since that time, he has built a business model that includes more than 50 franchises, 35 corporate team members, and hundreds of subcontractors.

“This model meets a pretty big need in the industry,” says Park. “Our customers know we’re not going anywhere. We have a 30-person office staff they can call and get results and solutions from, but they get the intimacy of speaking one-on-one with the owner. He or she is at their house every day, making sure it’s going well. It makes for a very unique and pleasant experience for homeowners.”

“One of the things that allowed me to grow was the desire and ability to look forward a bit further than just ‘what am I doing today and what am I doing tomorrow?’ It’s having some forward-thinking,” advises Park. “Where do we want to go, and what do we need to put in place to get there? Then start looking for resources, asking questions, networking, and meeting new people that have the answers we are looking for. Have a direction and pursue it.”

Knowing when to grow the business and add to the team is something Fritzel initially struggled with.

“Perennial currently has a family of eight, but it took lots of trial and error to find people that fit our culture and work-ethic,” he notes. “We have also learned it is better to invest in your staff by offering paths for growth. Healthy pay increases tied to their skill level and open communication help decrease our turnover, helping our walking institutions of knowledge stay happy and committed to the Perennial family.”

CONTINUED EDUCATION
Whether staying on top of the latest colors and styles, perfecting custom installation techniques, or seeing innovative products, wood flooring pros are learning constantly.

“We are always looking at the design trends inside and outside of our industry, and also looking for ways to use new machines or materials to make our process better or more streamlined,” offers Neuroh. “I always enjoy attending the annual NWFA Expo both to talk shop with peers and manufacturers, and learn from industry leaders through classes and hands-on demos.”

Demos, trade shows, webinars, online courses, in-person training sessions, and reading publications are just some of the ways to go about keeping up-to-date.

“I constantly push myself and my team to gain more industry knowledge and experience,” says Carter. “We utilize the NWFA University for training. Additionally, advancement within our company (and, in turn, pay scale) is tied to the successful completion of various NWFA and Bona certifications.”

Certification programs such as the NWFA’s Certified Professionals must be achieved through specific online and hands-on testing. Once certification is obtained, Continuing Certification Units (CCUs) are required to maintain it, so it is one way to encourage ongoing education.

Bryan Park says that once you have established the direction you and your business are going, use the resources around you: “I lean on the NWFA so much,” he notes. “We fly in trainers. I don’t need to reinvent the wheel because there’s a ton of resources out there at our fingertips.”

And, sometimes, those resources may be other companies in the industry. “We love adding herringbone, and it was Matthew Young (of Young Brothers Hardwood Floors in Westminster, Colorado) that drove an hour to help teach us how to mill and install it properly,” he recalls. “To me, the best resource any new hardwood flooring company has is developing relationships with your distributors, competition, and institutions like the NWFA.”

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Overall, the installers we spoke with note the importance of having a value proposition and a niche to maintain a successful business.

“It may be price, quality, meeting a specific need/product, or providing service that’s above and beyond,” advises Neuroh. “If there’s nothing that sets your company apart from the competition, there’s less of a reason for clients to want to hire you. Be different; stand out.”

And, despite all of the advice out there, there are times when the most useful lessons learned in business may come the hard way.

“I don’t think there’s any way to avoid that, that’s what it is to learn,” offers Park. “I’m always saying to franchisees when they ask what lessons have I learned, I can tell you all of my knowledge in my head from the experiences I’ve had and I will save you some lumps in the process, but until you’ve experienced it for yourself, it’s really not going to set in.”

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