Can you be more profitable doing less projects?
I’m a GC/Builder out of the foothills of NC. Up until recently, for the first couple years of my business, I’ve done remodeling. It’s my background and I’m comfortable doing it, although with all the extra attention needed working inside of occupied homes and existing conditions – Doing 3+ projects at a time like this becomes overwhelming. I mostly sub out most of the work but I have a strong desire to put the bags back on, I’m picky and detailed-oriented, however I feel a lot slips because I cannot attend to each job as much as I would like.
I’m currently building my own house. I have a goal of building high-performance homes in my area and I’ve found, especially in framing, you pretty much have to be on site the whole time to make sure specific details are nailed. I have some interest and will be building at least 2 new custom (semi)high-performance homes next year for clients. Each is between the $500-$800K range
My question is, is there a feasible way to build 1 home at a time and make the profits that I desire to maintain my business goals? We’re structured as a LLC, filing as a S-Corp. I pay myself and my wife(who works in the business) a $50K salary each and I would like a bonus payout each year of somewhere between $50k-$100K after expenses. We have a lowish overhead, with vehichle payment, software and accounting fees, we spend around $1500-$1700 a month in overhead. I do not wish to scale my business in any fashion – I would like to focus on high-performance, high-design, high-quality homes. I know it’s niche but I don’t need a ton of projects and I believe the money and market is here.
I think I could bill for hands on work and project management as well as the builder fee. Things I would take on to control quality would be all flooring(sub out hardwood sanding), tile, paint, interior trim and lighter framing. I’m close with all my trade partners and would assist in floor sanding, plumbing and electric(they all need help anyway) I enjoy working with my hands but I also have a lifestyle goal (early retirement) before my body wears out. I do not enjoy the feeling of running multiple jobs, especially in todays labor climate.
I appreciate any thoughts or insight. Thank you!
I've worked one project at a time for 29 years and counting. And during that time I put our
daughter thru Chapman University; visited England, France, and Italy as well as parts of the US; and paid for a wedding. I doubled up one time and the stress was awful. Your customers will appreciate it because you're only working for them, and generally the job will get done more quickly. I am semi retired now, working only those little jobs that either amuse me or challenge me. The work is part of my enjoying life, so as long as I
can physically do the work I will. My biggest problem is many of my quality subs are
retiring and it is difficult but not impossible to find quality replacements. My thoughts,
take them or leave them.
Thank you for that! While i absolutely have financial goals, quality of life and quality of the project are huge drivers for me.
I would love to continue this conversation and expand on the logistics of how you operated.
I simply told prospective customers that I only did one job at a time and if they wanted to get into the queue, they needed to sign a contract. It was an effective
marketing tool. Because there was a queue, I could preorder long lead time items
which helped with the scheduling. Today unfortunately that doesn't work so well.
Quality of life was definitely my goal as I never missed a dance recital or social
event for my daughter or my wife.
What size/type jobs did you mainly do?
First, remodeling only, my favorite is a kitchen, followed by general cabinetry. I just finished a Pool House/Granny flat. I'm very good at rebuilding existing cabinets in kitchen to install new ovens or microwaves. I have a guy in the local paint store who can exactly match stains or cabinet finishes. So that allows me to make minor changes in a kitchen without having to demo whole. Again for me it's the challenge.
Quality is king. But in the remodeling world that I live, I also found that speed is essential, especially if people live in the home while work is being performed. Over 30 years of working in this field I have acquired the skills to perform every trade necessary for pretty much every job I take on. This allows me to take on complete bathroom or kitchen or full basement jobs without having to sub out any trade. This translates into a full bathroom gut to finish job in 3 weeks flat, where everything is perfect and the client is always happy. I charge a premium for this convenience and assurance to my clients. There is real value there for clients and they do not mind paying this premium. I have too many stories of clients who chose to go with someone else (that was cheaper), but then ended up with a project that took up to a year or longer to complete, or in the end was not completed to their satisfaction, simply because sub-contractor management or quality got derailed. Long story short, yes going it alone is possible, can be profitable to allow you your lifestyle, can be extremely rewarding, assures client satisfaction and most of all reduces your stress level. At this point I have a waiting list of clients, take on no more that 2 jobs at a time (I try to manage the jobs I take on to overlap in different phases of completion, so there is never any downtime (such as inclement weather) to keep me productive and profitable at all times of the year (Michigan)). I take off when I want, I travel all over the world when I want (I can schedule that very easily with project demands and do at least one trip per year to Europe or Central America, or wherever I please to go), my family is well taken care of and I am much more at ease, then when I had large crews and subs on multiple jobs at a time.
That does sound wonderful. Do you believe this is scalable to a new build? Of course you would need help of other trades or could possibly do the prep to help them execute their work efficiently.
I only ask because while I would prefer to personally do what you’re doing with smaller jobs, I feel an obligation to try and change the way homes are built in my area - to make them more durable, efficient, comfortable and have better indoor air quality.