00:00:00:01 - 00:00:16:10
Speaker 1
You'll understand this. We're building a one of a kind prototype, but it's not a prototype for anything in the future. Right. You know, we're building at one time, warts at all. Whatever it is, figuring out a bunch of new stuff.

00:00:16:12 - 00:00:23:01
Speaker 1
And.

00:00:23:03 - 00:00:45:11
Speaker 2
We were here to talk about building luxury homes today. And this is something that, you know, I think, like a lot of builders, you know, I started off doing, like, small projects, remodels and then over the years, just kind of building more experience. I've kind of moved up, up, up in the price range to where now I would consider myself a quote unquote luxury builder.

00:00:45:13 - 00:01:06:00
Speaker 2
But, you know, one of the things that I've had to learn over the years is that there's a big difference in client between the the bathroom remodel client in a, $150,000 house and a, expensive luxury client. So today, here to talk to me about, building luxury homes and kind of all that goes along with that, is my friend Greg East.

00:01:06:02 - 00:01:10:00
Speaker 2
Greg works for Winfrey design build. So, Greg, welcome to the show today.

00:01:10:01 - 00:01:14:23
Speaker 1
Well, thank you for having me. We've talked about this a long time. I've been looking forward to it. And, appreciate being here.

00:01:15:00 - 00:01:21:20
Speaker 2
Yeah. So tell us what you do at Winfrey. Obviously, you're not the owner. That's Bruce Winfrey. What is your what is your role at Winfrey?

00:01:21:20 - 00:01:32:13
Speaker 1
Yeah. So technically, I'm the chief operating officer and, executive vice president, and I'm responsible for the bottom line, but I'm also the chief marketing officer and chief technical officer. You know the drill.

00:01:32:13 - 00:01:33:10
Speaker 2
You also mop the floor.

00:01:33:13 - 00:01:53:06
Speaker 1
Yeah. So you know the drill. And you know, that's by design. You know, so everybody we deal with out on a project is, contract labor. You know, so, no, not very many people work directly for us. So even, you know, we outsource supervision, things like that. But, you know, Bruce and I had the opportunity to watch Bruce when I was, you know, building one going very well.

00:01:53:06 - 00:02:09:23
Speaker 1
So I was running a dental plan. I was marketing director for a dental plan. We just happened to office in the same building. So I already knew him as a friend. And I got to watch him with not an eye towards working for him. And I got to see the integrity and kind of the way he operated and, you know, been in building since I came out of college.

00:02:09:23 - 00:02:28:15
Speaker 1
My family had an aluminum, went to company that I got to take over, you know, in my mid 20s, which could have been good or bad. But that was the 80s as we talked about. So we'll never know how that turned out. By the way. But you learn a lot through times like that. You know, people talk about it, but, you know, that gave me a chance to know Bruce as a person.

00:02:28:15 - 00:02:50:00
Speaker 1
So when I had the opportunity to work for him, I went after it. So I came after him as a consultant when he had, Millennium Builders back in the night, you know, 1997 and that era. And they changed their name because we were doing stuff in Dallas and Austin and places like that. And that company back in those dollar, dollar days was probably about 25,000,015 people.

00:02:50:00 - 00:03:05:20
Speaker 1
And, when I when it happened, we just couldn't get rid of stuff fast enough. So I was doing a project on Lake Austin for him. Got to be the last guy in the department to go. But, you know, I knew it. It's kind of weird when your friend walks in your office, but it was all good. I've been there on the other side of the desk before, and we'd stayed in touch.

00:03:05:20 - 00:03:24:21
Speaker 1
He was lucky enough to go travel. I was lucky enough to fall into a weird investment banking deal that took almost a year. And when that was over in oh nine, things were starting to improve. So we got back together. And like you see on TV almost, we sat down and we started writing down the kind of company that we would design if we had that opportunity.

00:03:24:23 - 00:03:43:18
Speaker 1
I was a new or soon to be new stepdad. I felt like, you know, I'd really met somebody with the young son. I started to be a lot more serious than when I was a single independent person. And, you know, Bruce has four kids, so he was already in that mode. But, you know, the vision that he has as a builder is why I was interested.

00:03:43:19 - 00:04:01:07
Speaker 1
So I've been around builders my whole life, you know, high caliber guys that, that, you know, of, Greg has, you know, he was a one of the best superintendents. My dad would, would, would call on and and guys like him and John Harris and guys that worked for guys back then were guys that my dad said, they'll be somebody one day.

00:04:01:09 - 00:04:23:17
Speaker 1
And sure enough, you know, they're just still a layup. Guys like that, fewer and farther between, you know, that that I see that, still remember my dad, you know, he's still alive. So he's, you know, I'm still the second best salesman in the world till something happens to here, but, you know, so it's kind of neat having that that understanding for me as a, failing business and knowing what it's like to be the boss.

00:04:23:17 - 00:04:38:00
Speaker 1
And so when Bruce and I got back together, he's like, he's no offense. I want to own this thing. I don't want a partner which you'd had before. I want this to all be me. And that's why I'm going to put my name on the door. And I remind him of that quite a bit. You can't separate too much, dude.

00:04:38:00 - 00:04:57:10
Speaker 1
You should have picked what I wanted, which was Precipice Builders. And I have to admit, that doesn't roll off your tongue. But I had it all. Pictured him standing on a cliff. You know, the whole bed and, go in with one for design build. You know, the biggest challenge was that design build. People don't understand what that term means as much and residential as commercial.

00:04:57:10 - 00:05:21:20
Speaker 1
But, I mean, it's been a fun ride, you know, and the way we laid it out, we started working out of his house in Tanglewood, much as you may have. And he had already done that progression that you alluded to. He had done the remodeling. He'd done the production work with Newmark Homes. And one of the things I brag about when Newmark when John Harris, who on Newmark at the time needed a production manager or a project manager to do something in his house, Bruce was the one.

00:05:21:20 - 00:05:39:18
Speaker 1
More times than not, Bruce says that can be good or bad working at the boss's house. But I've known John personally for a long time and know what his standards are and those kind of things, and knew I was hooking myself to the right store. So having been the man, being the right hand man behind the man is a lot better in a lot of ways.

00:05:39:18 - 00:05:56:18
Speaker 1
I get all the glory when it's fun, but otherwise, yeah, it's 100%, you know, so I applaud Bruce for that because it makes it real easy. He takes my input, but at the end of the day, if there's a tough decision to be made and he says East, we're going to do X, then we do X. Yeah.

00:05:56:18 - 00:06:15:22
Speaker 1
And there's there's been some battles, as you can imagine. But it's been fun, you know, because doing things like that with your best friend, staying best friends for ten years, you know, and into it and seeing it progress the way you planned, you know, through thick and thin. First we're going to get somebody to do what you don't like as much, Bruce, and we'll get somebody to do it.

00:06:15:22 - 00:06:30:05
Speaker 1
I don't like. Then we'll get an office one day. And you know, the Lord has been in all of that. And we both acknowledge that, you know, but definitely, you know, we've, you know, tried to do our part and take advantage of the wisdom, you know, that we've gained over all these trials.

00:06:30:05 - 00:06:44:09
Speaker 2
And so that's a that's a great story of how we all got together and, and grew that company. Well, what kinds of projects do you guys typically do? I mean, are you all doing all customs or are you doing some specs or, you know, what's your typical.

00:06:44:09 - 00:07:01:19
Speaker 1
Project? Yeah. Great question. We go for about an 8020 mix. So you know, only 1 or 2 projects we do every year show up on the MLS. So we have a couple of our own projects going hopefully at any one time. And those projects especially, we've really pushed up and we felt like, you know, a little bit more work.

00:07:01:19 - 00:07:23:13
Speaker 1
But again, having the capacity that we do to borrow money and to to borrow money and fund bigger projects, it's just a little bit more rarefied air, a little bit less competition as there is in the $2.5 million homes. You know, that sounds funny, but, you know, four, 4 to 5 is where we're kind of pushing with our own projects just because of the success we've had in those areas.

00:07:23:13 - 00:07:47:08
Speaker 1
And, you know, we've got a good, picture of what that house would look like, you know, 7000ft, certain pictures, you know, things like that. But it's, you know, something we use in marketing. So the other 80% of what we do or contracts, you know, people that come to us through referral, through advertising, come into open houses, things of that nature, and everything is set up for those clients.

00:07:47:08 - 00:07:57:19
Speaker 1
We'd love it if all of our jobs maybe were paying, but but the speculative jobs we call it for sale building, because it's actually a totally different level than what people think of when you hear that.

00:07:57:21 - 00:07:58:05
Speaker 2
That.

00:07:58:07 - 00:08:16:16
Speaker 1
Type of deal. But, you know, we use it in marketing because it helps keep us sharp. Yeah. So we pay decorators for that. We're making the choices that we have to live by. And then the affirmations in the market. But more importantly, we had one that summer for about four months that was on the market. We're never worried about it.

00:08:16:16 - 00:08:36:07
Speaker 1
We had tons of activity, but we had people coming through there at open houses that we controlled. It would either be me or Bruce of one of our other employees, and it's nothing against realtors. You know, we're not trying to save that money. We have that in our budget, but we meet people that day, as opposed to a realtor that's going to give the builder the lead.

00:08:36:07 - 00:08:58:01
Speaker 1
The next day is great marketing. It is fantastic. And you learn a lot about what people want. Lots of people coming through that could buy it, but they're under different stage and they just want to see what builders are doing. You have these great conversations and you know, most of them have a home somewhere. You know, sometimes, hey, if you want to tear down, you know, sell it like that, you know, so we've even made land connections that way.

00:08:58:01 - 00:09:04:14
Speaker 1
And, just, you know, kind of keeps us engaged with what people are looking for when we're having to put our own product out there.

00:09:04:14 - 00:09:19:06
Speaker 2
Yeah. Every open house we've, we've done on spec houses back when we used to do that, which we don't now, but every open house that we did, I always got leads for customers from those open houses people walk through, they see your work, you get to shake their hand and meet them. Right, man, I won't do business with those guys.

00:09:19:06 - 00:09:27:03
Speaker 2
But also what you said is great too. People walk through, they're like, well, why do you do that? Or I man, I wish that you would use that color or that style or whatever.

00:09:27:05 - 00:09:28:02
Speaker 1
And if had a few of.

00:09:28:02 - 00:09:40:00
Speaker 2
Those and that's great feedback, right? I mean, it's it's like, yeah, I mean, everyone has their own style or opinion, right? But if you keep hearing the same feedback from a lot of people, that's something that you should put in your computer and work into the next job, right?

00:09:40:05 - 00:10:05:03
Speaker 1
100%. But it's painful, as you can imagine on a house. How hard is it to un elevate an elevated living room area, our dining room here. All right. So that's on our list of stuff not to do. And and in that same elevated home, we also had a sunken area under this beautiful glass, modern glass fireplace. And we thought it'd be neat rather than putting anything in there as a conversation, you could put whatever floral arrangement, whatever.

00:10:05:03 - 00:10:22:03
Speaker 1
We had the hardest time selling that out. People with kids would look at the elevated dining room that was so glamorous, and all they would think about is just an extended ten foot stair for their kids to fall down, you know, 2 or 3 stairs and the elevated thing, you know, people don't have the vision you think they do.

00:10:22:04 - 00:10:39:13
Speaker 1
We thought it would be need for somebody to speculate we could do this or that. So we said, we're dumb, we're going to fix this. My wife came over to the $2,000 floral arrangement in there, and I think we had a contract like a month later, something that was just it might have been coincidental the price was dropping along those lines as well.

00:10:39:13 - 00:10:47:08
Speaker 1
But, you know, it goes on the list. Don't do this. Don't do that. You know, to your point, the feedback was very consistent as we felt like.

00:10:47:14 - 00:11:11:22
Speaker 2
So one of the main things that I wanted to hit on today was, you know, dealing with it as you go up and price range, dealing with the luxury buyer. It's a different animal than dealing with, you know, some of the price ranges. I think everyone's got their own perks. But as you move up in price range, people have a higher expectation not only for finishing, but also for how you're going to manage them.

00:11:11:22 - 00:11:27:08
Speaker 2
And the building process. You know, how you're going to interact with them. And so I just want to talk about like what? What's your take on how do how does that buyer's expectation or that client's expectation differ from let's say let's say just kind of a lower price point person?

00:11:27:08 - 00:11:43:10
Speaker 1
Well, it's a great question because it's, you know, obviously a different part of the market. And, you know, when I was in the insurance business, I was in a property, property casualty insurance business with Hodgkins for a period of time before I realized the building side was a place to be. And, you know, I learned a lot through that.

00:11:43:10 - 00:12:05:06
Speaker 1
But one thing, you know, we talk about in that, what's the client's pain? You know, that's a big thing in sales and stuff. We'll throw that out the window when it comes to luxury building, because nobody has to have a $5 million house. I mean, sure, they get transferred from Connecticut. I've seen guys buy stuff, you know, that just needed a place because the president of the company needed to have a Houston address because the company was there while he still lived in Connecticut.

00:12:05:06 - 00:12:28:04
Speaker 1
You know, those kind of things are rare. But once you don't have those sales tools, what's your pain? Where's the wedge? You know, all of those catchphrases that that people would see in a modern sales seminar. It then goes back to, well, what are your needs? You know, you get away from, you know, well, let's find the pain and hammer on that to more like, let's get them to say, yes, we need more space.

00:12:28:04 - 00:12:47:19
Speaker 1
Yes, we need to downsize. I mean, we've had people downsize into 6000 square foot less, you know, and they still want room for the kids and things, you know. But, to that end, we put an elevator shaft in every house. If we don't put an elevator, because we do think people and a house of that quality might age in place and, and want that.

00:12:47:21 - 00:13:12:10
Speaker 1
But but at the end of the day, talking and thinking about those people, there's so many cliches. They do get up and get dressed like we do on the mornings. And the thing is, I say this very humbly, but also very proudly. We for some reason, had a goal of also not working with any stinkers. We had the luxury of, maybe, I would say, not being so hungry that we just had to deal with somebody that we you.

00:13:12:10 - 00:13:13:14
Speaker 2
Have to take the project.

00:13:13:15 - 00:13:33:00
Speaker 1
Yes, yes. And again, that's why I say it humbly. Because we've all been there. You're going to get it. You got to have that whatever 100 K or whatever to keep the doors open. And you're going to deal with that guy and learn some lessons. Yeah. So we've cultivated that. When you deal with a lot of those nice people and, and they're all type s, you know, they're all good at something.

00:13:33:00 - 00:13:54:18
Speaker 1
I like to say, if somebody reaches out to us and we can't find them, a they don't have the money or be they just got it. Everybody. And they're not people that you would know if I said their names, but they're big in their field. They're great doctors or great lawyers or great business owners. And you know, those people by and large, are great people, you know, I mean, everybody knows rich people that aren't happy.

00:13:54:18 - 00:14:15:18
Speaker 1
But we deal with the happy millionaires. And, you know, our goal is to keep them happy. And part of our pitch is very simple. We tell them something that they don't expect to tell them. We're going to fix it where you have fun, your wife's going to have fun. The boss that's almost always the boss. And and you're going to have fun because it's going to be something where you see progress all the time.

00:14:15:20 - 00:14:35:16
Speaker 2
So we've had like a this big rash. I say rash this big, this terrible term for this, a big influx over the last couple of years of people with trust fund money who were wanting to do projects, and that's almost like a whole separate category, right? Because talk about, like, not having the pain for for making a buying decision.

00:14:35:16 - 00:14:45:04
Speaker 2
Yes. A lot of those people, it's just they want what they want and there's, there's, there's sometimes some sense of entitlement to deal with. I'm not making a buying statement if you.

00:14:45:05 - 00:14:46:11
Speaker 1
Right, right. If you're a.

00:14:46:17 - 00:14:52:15
Speaker 2
Trust fund out there and you're listening, I'm not trying to offend you. But I think even even if you do, you probably know other people.

00:14:52:21 - 00:14:53:14
Speaker 1
And yes.

00:14:53:16 - 00:14:54:18
Speaker 2
In this situation, I'm.

00:14:54:18 - 00:14:56:18
Speaker 1
Not saying I wouldn't be a jerk to.

00:14:56:20 - 00:15:17:00
Speaker 2
Some entitlement. Right. But there's a lot of times there's not as much, sense of urgency to get this project done. It's like having I bought this lot and I don't mind sitting on it for 2 or 3 years with nothing happening, whereas if it was first, it feels like an $800,000 house. And those people are making two mortgage payments.

00:15:17:00 - 00:15:37:02
Speaker 2
They have a lot of pain. They're like, okay, let's get this thing built. Let's get it over with 100%. If they have the money to sit on it, there's there's no sense of urgency to get the project started. I mean, we get sets of plans that have people been sitting on a set of plans for 2 or 3 years and haven't started building the house yet and trying to get them off the high center and get them going?

00:15:37:02 - 00:15:38:06
Speaker 2
It's painful sometimes.

00:15:38:06 - 00:15:55:07
Speaker 1
Well, and you learn from stuff like that, you know, you let a client suck you into something that's actually not part of your model. And then number one, you're mad the whole time. And number two, the reason that's not part of your model is it's not part of a successful project. Albatrosses do not look well, you know, even if nobody.

00:15:55:09 - 00:16:10:03
Speaker 1
Hey. Well, no, no, the clients changed a bunch of stuff and it took an extra three months, so I had to wait for this. Whatever. People driving by a house that should have been built in a year, that's built in to make their assumptions, and rightly so. Somebody is bossing the builder rather than the boss, you know, builder being the boss.

00:16:10:03 - 00:16:29:21
Speaker 1
And we tell people we're the experts. You and I've probably talked about this, you know, it's a big deal. The, you know, Castle Builders Council. But we do a fixed price contract and that's our first stage of vetting. And my opinion, people that want cost plus are people that don't trust builders. And the people always want to know what we make like, well, we make good money, but good for you.

00:16:29:22 - 00:16:47:04
Speaker 1
Technology makes it a lot cheaper than it would have been for somebody of Bruce's experience and caliber of builder. We can spread him around more than you would back in the old days for that kind of builder. Only built 2 or 3 homes a year. The other thing is, you know, we wanted divorced people from the dollars and cents.

00:16:47:06 - 00:17:08:17
Speaker 1
Get them on the figure. But once that figure is established, get them into that having fun mode. Now you've got your allowances. Let's go do all of this other fun stuff that's already been taken care of. And, you know, Bruce and I value ourselves as B pluses. So we deal with the type A's. But you two types banging their heads together, you know, even if we have those tendencies, does it work?

00:17:08:17 - 00:17:22:15
Speaker 1
Well, you know, we want to come at it a little bit below them and their intensity. But we want to feed off of it. But then we want our subtle, confidence in our experience to come through in our interaction because we really are confident that we can do them a good job.

00:17:22:18 - 00:17:39:11
Speaker 2
I think one thing that that most luxury high end clients have in common is that they want to feel like they're taken care of on a mission, and part of that is they want to have a good time in the process and not and not feel like they're struggling through it. But they want to feel like they're being taken care of.

00:17:39:11 - 00:18:04:05
Speaker 2
They're they're they're used to going and buying a high end car and having an experience at the dealership, going to a restaurant, being catered to, having having an experience. And so I think, you know, we as builders who are trying to operate in that space also need to create a buying experience for them to where they feel like we are managing the process and we're we're taking care of them.

00:18:04:09 - 00:18:04:23
Speaker 2
Right.

00:18:05:00 - 00:18:21:08
Speaker 1
Well, and a lot of it to that point is getting them to visualize what what's been on paper or what they're talking about or what's they sketching on a napkin. And one of the ways we do that, you know, we almost always have something that's close to being done. If it's not for one of our clients, it's our own project.

00:18:21:10 - 00:18:41:00
Speaker 1
I mentioned the one we had this summer. You know, we got the price. We wanted 4.2 million, but we started a little bit high so we wouldn't. So we'd have that summer to meet some people. And invariably in the process, we had a number of people that we're talking to about building come in through there, and people that we'd even signed up that were starting to think about selections and stuff.

00:18:41:00 - 00:19:03:09
Speaker 1
So it's, you know, they're walking through, they're going, okay, I made a good decision or I'm on my way to making a good decision because these guys using their own money, have built something that's worth $4.2 million. And that actually is a lot more expensive. You know, buying that house and somebody coming to us with land and everything, you know, there's quite a bit of value and the risks that we take as far as, you know, what we, you know, realize in the end is, you know.

00:19:03:11 - 00:19:23:12
Speaker 2
Yeah, I think something else that that tends to happen is people, yeah. So everyone has a budget, right? Even if you're even if you're rich, you still have a budget. But I think that as you move into that high end, people kind of have an expectation of more bells and whistles, and they they're likely to see something and kind of lock on to that.

00:19:23:12 - 00:19:25:14
Speaker 2
And ooh, that's shiny. I want that in my bill.

00:19:25:14 - 00:19:26:00
Speaker 1
Yes.

00:19:26:00 - 00:19:50:21
Speaker 2
Right. How do we manage kind of all those extra I want that I want that, I want that all those extra desires with also kind of keeping them in budget. And this is the this is an issue for all price real builders that builders. Right. Not just luxury but but I think when maybe when people feel like that's just more in their reach financially, they have the the tendency to just say, oh, give me that.

00:19:50:22 - 00:19:56:14
Speaker 2
Right. Yeah. And then then you're like, yeah, well, that's, you know, $200,000 item. Where are you sure?

00:19:56:20 - 00:20:16:04
Speaker 1
Yeah, over a month ago. That was a great idea. It's not a good idea now because we've surpassed that, you know, that stage or what have you. You know, that's that's what we worry about. And and to your point, you know, I like to say everybody has a budget, but it's it's theoretical in that what you're building should be constrained by the neighborhood.

00:20:16:04 - 00:20:31:12
Speaker 1
You know, I think we can agree on that. But River Oaks, that is a broad constraint. And it's not all the exterior of the home or the square footage. It's what people are putting inside. You mentioned things like that that touch people off. And I'll mention one of the ones that comes to my mind and that's hidden rooms.

00:20:31:14 - 00:20:47:12
Speaker 1
So we did a hidden room, one of the very first houses we did, there was a bookcase that looked great, you know, a very James Bond like that. I think it was the, elevator shaft. So it was going to be a closet, you know, until somebody did something or whatever. I think we built three homes that we met people or showed people that house.

00:20:47:12 - 00:21:05:11
Speaker 1
And two of the three wanted a hidden room. Yeah. And we did one in this last house in Overbrook. It was a hidden room in the closet that could be turned into a safe room or used in such a manner, you know, if somebody felt that way and, somebody that bought a house we were building in River Oaks off of that house before we saw the house and river Oaks.

00:21:05:11 - 00:21:30:03
Speaker 1
You guys does have a hidden room, and that one's got a hidden speakeasy, by the way. So, you know, the, you know, seeing a very wealthy person at the top of their profession who've probably just been in a meeting, you know, maybe you're reading somebody the riot act. Oh, God. We got the hidden room, you know, and that's what we enjoy, I guess, is seeing these people that are so self-assured in their other area, and they're sitting in front of us going, car Greg, we never done anything like that.

00:21:30:05 - 00:21:49:10
Speaker 1
We think it'd be cool. You know, we're 50 years old and we've lived on all these great houses and all these great cities, Japan and places like that. And that's humbling. You know, that somebody that could be a jerk or could throw their weight around a little bit is coming at you. Like you said, homebuyers across all levels are doing the same thing.

00:21:49:10 - 00:21:51:23
Speaker 1
And at the end of the day, they want a home for their family.

00:21:52:04 - 00:22:03:00
Speaker 2
Yeah. How do you keep them in check to some degree. You know, when they keep throwing these things out there that they that you know, is going to blow up their budget?

00:22:03:00 - 00:22:23:17
Speaker 1
Yes, yes. Well, there are a couple of good stories. So we were talking to Mark hike and his actually his, daughter and son in law, and they thought enough to bring him in on it. So we were having a visit. I've got friends that have, you know, done business with them, a long time Houston legend, you know, going back to playing for the Houston Oilers and, we were talking about stuff and he said, oh, Greg, that's what we're talking about.

00:22:23:17 - 00:22:44:12
Speaker 1
Budgets. And Greg goes, that's okay. I put my wife on an unlimited budget. And she broke it the first month. Only a billionaire could tell jokes like that. So to that point, you know, we've had a home. I'm thinking of one in Tanglewood. I want to say we set the tile count at 90,000. That was, 60 500 square foot house, you know, very, very nice home.

00:22:44:13 - 00:23:05:14
Speaker 1
And when we set the budget, the guy said, I do not care about that because I know my wife is going to go over that. And they went over $100,000. A lot of it came from Italy. Luckily it was pre-COVID. But, you know, man, oh man, I had taste. And the only thing that got you on that one, and it's to your point of what people don't know about bad things that happen to builders.

00:23:05:14 - 00:23:19:14
Speaker 1
And we kind of do it to ourselves. Somebody order something wrong. So we had two pallets of that material on sat out the front of the driveway went two weeks. It's supposed to get picked up, you know, it goes, it gets knocked and whatever. Well, guess who paid for the two pallets of stuff was supposed to go back.

00:23:19:14 - 00:23:43:03
Speaker 1
We did. And that's after the game. You're like, oh, hey, that was a terrible idea. You know? I was like, yeah, well, why did I think about that? So sometimes we pay the price of people's expensive taste. But you know, the thing that bothers me more is if you've already gone past that point and all of a sudden they're getting ideas outside of anything you've ever talked about, you know, and there's a price for that.

00:23:43:03 - 00:24:02:00
Speaker 1
But even if somebody is willing to pay, in my opinion and our philosophy is you almost can't charge them enough to make up for that lost time. I've got a budget, and I want to be out of this house at a certain time, and they're doing things that are adding months and two months. I'm getting paid all along the way, but it's not the margin the way I want it.

00:24:02:00 - 00:24:30:00
Speaker 1
You know, it's work for people that should be on something else that weren't prepared to do that. And so luckily, we just try to ride herd on that by really grinding. In that very beginning, we produce a 20 page specification schedule and it's all very practical. It's not anything that somebody couldn't copy. But down to the molding on every room line by room by room, and we sit there for 2 or 3 hours before we sign a contract and we go over every item.

00:24:30:02 - 00:24:48:05
Speaker 1
It's the first meeting. I'm like, Bruce, how can we jazz us up? I'm listening, you know, for my office. And it's painful, but it's the only way to do it. And it's not covering ourselves. You know, a it's we don't want to make a mistake, man. We're really prepared. But if we're prepared to go down the wrong path and you know, you're not prepared.

00:24:48:05 - 00:25:03:04
Speaker 1
And again, part of that vetting is even the wealthy folks, you know, we've already got a good feel for them at that time. And they kind of know how we're both going to operate on that. But, we've got one right now. You know, that's kind of like that. But so far it's been pretty good and held anything up.

00:25:03:04 - 00:25:07:20
Speaker 1
But you know that that's the element we don't want to be a slow builder because our clients are slow.

00:25:07:22 - 00:25:26:00
Speaker 2
I love, you know, writing a very detailed specification document. I'm a big, big proponent of that. And it's great for setting the expectations of the client. But there is also that element of CYA, in my opinion, because you can't get, you know, halfway through the project and they're like, well, you never told me what was going in there, right?

00:25:26:00 - 00:25:31:15
Speaker 2
Yeah. No, you know, we we we went over this in that meeting before we ever started construction on your contract. Right.

00:25:31:15 - 00:25:46:18
Speaker 1
Like we said, it's part of the contract. Yeah. We have it initialed. Make it part of the contract. And, you know, and most of the time, the smart people we deal with, you know, you could tell if they're playing dumb. Yeah. I was like, no, no, you're too sharp. You know, for that you do this for a living.

00:25:46:18 - 00:25:51:10
Speaker 1
If you're an attorney, you know, whatever. You know, we haven't run into that too much. You know, I think it's.

00:25:51:12 - 00:26:15:20
Speaker 2
I think it's more important to, to really specify everything the higher you go. And your price point, too. But just because the buyers, their expectations might be vastly different than yours. And what something's going to look like, like, guess I like to use the example of, you could have a powder bathroom, right? Just a little like a little four foot by eight foot space under the tent, under the stairs.

00:26:15:20 - 00:26:21:01
Speaker 2
Right? That powder bathroom could be a $30,000 little area. Right.

00:26:21:01 - 00:26:22:00
Speaker 1
And a minute.

00:26:22:02 - 00:26:44:23
Speaker 2
You know, between the plumbing fixtures and the tile on the wallpaper and the lighting and everything. Right. And if you don't specify what's going in that or have some very well defined allowances that, that you're putting in place, you know, they might have in their mind a very expensive sink, you know, wall mounted faucet exposed plumbing plated.

00:26:45:01 - 00:27:09:04
Speaker 2
Yeah. Right. And unfortunately, I've seen a lot of builder documents on the on the back end of the lawsuit side where I read the contract and the contracts, like install vanity cabinet, period. It's like, well, it's like, okay, what the wait, what kind of what kind of vanity cabinet is that? Right? Like, you can't just leave it up to the builder and say, the builder is going to put in whatever they want, because that that client's expectation is probably went way up here.

00:27:09:04 - 00:27:12:08
Speaker 2
Yes. Where the builders expectation is all the way down here.

00:27:12:10 - 00:27:28:07
Speaker 1
Well, and to your point, we took over for a bad builder. You know, just one time. It was our ideal situation. It was at the right point. These poor people had, you know, their house had been stopped for a year and a half. And, we got to see behind the curtain. So they're in a lawsuit with the builder still to this day.

00:27:28:09 - 00:27:50:11
Speaker 1
And, you know, we competed with this builder, compete it. I say now because you have a tendency if you're a good builder, to think, oh man, these other guys, their their pictures look just like ours. Do you walk a few houses like. Yeah. But the house is not built like ours are. You realize, hey, so-and-so has been a production builder, or he was an engineer and now he started building and it's neither here nor there, you know, you can.

00:27:50:11 - 00:28:09:00
Speaker 1
It's a wild West a lot of times, but you just have a tendency to give them the benefit of the doubt. And then you see behind the curtain, this particular builder had a three page specifications and they were light. And it's like, well, no wonder you're getting sued, dude. And his way of dealing with things was, hey, they'd point things out that they thought they were getting.

00:28:09:00 - 00:28:32:09
Speaker 1
Or two months later when they didn't get him or whatever, or when they did, and he'd charge them and do different things that were just it wasn't professional. And and yet the builders still out there building up a storm. You know, because it's hard to there. There's not a resume like that that follows builders or whatever. And, you know, the sad thing is, for these poor people, they had to pay for that house, the rest of it by themselves.

00:28:32:11 - 00:28:50:08
Speaker 1
Banks not going to loan them any more money, and now they're just looking to get out of it. And, you know, some of the people representing them are probably people that I would call to represent me. And it's like, oh, great, they're representing bad builders and good builder, you know, honestly. And so it it just makes, you know, you're on the right track.

00:28:50:08 - 00:29:00:23
Speaker 1
And it also makes you realize that a lot of these guys are at the right time, at the right place, and they've got a different model and they're maybe accepting less money than you and I might take.

00:29:00:23 - 00:29:21:00
Speaker 2
Yeah, absolutely. I mean, or there's there's some element of kind of a, a bait and switch situation like let's get them in for a low price. Yes. You know, kind of fool them and then, and then hit him on the back end. I mean, we've got one that we just finished up that we took over and the builder budgeted, I think, $30,000 for cabinets on a 7000 square foot.

00:29:21:00 - 00:29:22:14
Speaker 2
Oh my God, that custom home.

00:29:22:19 - 00:29:25:03
Speaker 1
Yes. Oh, that's what I'm talking about.

00:29:25:05 - 00:29:55:00
Speaker 2
And we come in and we're like, dude, 120 is like a cabinet budget, you know, and especially like the kind of cabinets that you're telling me that you want, you know, I mean, could you go buy some off the shelf particleboard cabinets for 30 or 40? Maybe, but not for what you want? Yeah. And so that's what I'm saying is, is having those specifications written down to the T, like, hey, we're using this casing on this window and this baseboard, and this room's getting this finish on the walls.

00:29:55:01 - 00:30:11:18
Speaker 2
I think that's an expectation that goes along with the price range of house that were, that were operating in, and again, it's, it's partially setting expectations for the clients, but it's also protecting ourselves so that we don't get into that dispute. Yes. Six months into the job.

00:30:11:18 - 00:30:29:18
Speaker 1
Well, and one of my sales adages was, I don't know if I came up with this, but it's pithy is when in sales and I've experienced this in the insurance business and in the hard goods business, you know, windows and things like that. But when you're selling things like this, you take something that's tangible and you make it intangible.

00:30:29:18 - 00:30:52:00
Speaker 1
So you take home, but you make it security, you make it, you know, moving up. You make it all of those things that are intangibles. And then you take something tangible sitting right in front of you like a car, you know, same thing. But then when things are intangible, like insurance or even this, you know, when you're talking about a plan, that's a concept and one dimension that's part of making it tangible to us.

00:30:52:00 - 00:31:07:19
Speaker 1
This is your dream right now. It's intangible. Your friends have done it. You live in a house, but this is going to be a one of a kind that's not been created yet, but it's going to be this, you know, it's going to have these features. It's going to have the wolf subzero, you know, all of those things are in the spec.

00:31:07:21 - 00:31:24:07
Speaker 1
And as part of Vietnam, I'm excited about what they're going to have knowing picturing it. I'll mention one thing. You know, it's kind of along the lines of what we're talking about. I mentioned Jeremy, you know, when we talked to him about wanting to do more with Brickman. David Cox, you've had on your show, designed TCA.

00:31:24:08 - 00:31:49:15
Speaker 1
Does it? Todd Rice now does it in his office. But we get to the point where if you didn't have 3D and you couldn't show people designs in 3D, it would be harder to recommend them because I. So the way I understand it and I'm not, spatially, you know, spatially challenge. So I got to see something, you know, I got to understand it in 3D better than Bruce or a guy like you that might see things.

00:31:49:17 - 00:32:08:09
Speaker 1
You know, I say, Bruce, these things like The matrix, you know, it's ones and zeros to me. But he's seeing a plan. He's seeing 12ft ceilings, you know, while he's looking at it. Probably much the same as you. And so that that 3D now there's something that, you know, we, we want all of our designers to use because it just helps people understand their space.

00:32:08:11 - 00:32:23:13
Speaker 1
And even now they're probably adding features and things like that, you know? So it makes it even easier when you've got a full cabinet layout in the design and things like that. So, that's made it a lot easier to get people on board, I guess, to get them excited about the three dimensions that are yet to come.

00:32:23:13 - 00:33:00:10
Speaker 2
Yep. So let's let's talk about how, you know, how we, you know, interact and kind of some of the interpersonal things that go into sometimes dealing with people who are more on the upper end of the, of the price spectrum. So sometimes, we're, we're talking to not only, you know, the husband and wife, but there might be more decision makers, like, I've had more instances recently where there's like somebody's father is also involved, or maybe there's like a family manager, or they have an owner's representative or you're interfacing with more people other than just the the couple.

00:33:00:10 - 00:33:19:01
Speaker 2
Right. And you're dealing with multiple decision makers. So, you know, how how do you how do you kind of figure out how to navigate that and figure out, you know, kind of how to how to get a decision made when it seems like there's a lot of decision makers out there.

00:33:19:03 - 00:33:42:21
Speaker 1
Well, I mean, that's a great question. And we've encountered that as well. Actually the home that we had for sale and Roy, now that we sold this summer, had three different Texans involved. You're curious that at at one time, one of which made an offer and, you know, I'd say our standard contract to even if we let them use a track contract, maybe 35 pages or whatever with a few addendum, this was 104 pages.

00:33:42:21 - 00:34:03:16
Speaker 1
So, hey, we need a copy of the warranty. There were vetting for this Texan, and, started off with a lowball. We hate lowball. So our counter is the price. We're not going to give you the price. Even though I had a price in mind and, you know, might have been bad advice, it might have been some attorney because it was a trust in the player's name and the attorney was going to be his representative.

00:34:03:18 - 00:34:22:00
Speaker 1
And all of these people have to just buy whatever retainer they're getting. And I hate to say that, but everybody knows that. But the person hiring those people feel like it's well worth it because their time is not able to be used on this. You know, pro football, some of these professions 80, 90 hours a week doing what you do, doing it away from home.

00:34:22:06 - 00:34:40:17
Speaker 1
So I didn't begrudge them that. But it was just kind of a picture into what you're talking about. All these hands and they're keeping it, keeping their client from getting what they wanted. You know, we did not want to sign a non-disclosure agreement. If we can avoid it, get the same price. And they don't understand those things, you know, they're just caught up.

00:34:40:17 - 00:34:58:07
Speaker 1
And I'm going to protect their interests, and, you know, so that's one side of things. The other side of things along the way that you're talking is talking to some of these people. You know, sometimes when you really become friends with them and they want to change something, that's something that you wholeheartedly agree with. You know, boy, we didn't catch that on the plan.

00:34:58:07 - 00:35:16:13
Speaker 1
That's a great spot for this or a spot for that. So we try to turn it into a collaborative thing. Well, let's see if we can do what you want. But it you know, it just kind of one of those things where our, you know, ideal person, number one, we say to people right in the first meeting, number one, you got to be good at buying stuff together.

00:35:16:15 - 00:35:34:10
Speaker 1
And number two, it's got to be you and what you want. But to your point, once we get closer to that contract and they've said, yeah, we love the design from the designer, you know that you've already got lined up or whatever. And then they're like, oh yeah, by the way, I'm going to want my decorator out in California that I'm good friends with.

00:35:34:10 - 00:35:57:02
Speaker 1
I'm going to want her to come in on these things. You can pay your designer. We're going to change some things, but you're not going to be paying for it. Head out of California. And so you got to be quick at all that. So far so good. And the other thing is, hey, I've got a older builder. I don't have a bank to guys pay in cash, but I want him to come by and check things out so automatically, oh golly, this guy is going to be trying to earn his keep.

00:35:57:02 - 00:36:15:01
Speaker 1
Nothing could be further from the truth. That's been a great partnership with those people involved. So some of it comes back to the caliber of person you're dealing with. And we've usually got a pretty good read at that time. And I can humbly say if something really didn't strike us well, part of our goals are the same as yours and the same for our clients.

00:36:15:01 - 00:36:31:03
Speaker 1
We live a balanced life. I'm not going to bed worrying about anybody's problems but my own, and I don't want their problems to be part of them. So, you know, we try to get in front of that stuff, will rip it off like a Band-Aid and say, look, man, this was going great till X and, thankfully we've had to do that.

00:36:31:03 - 00:36:36:07
Speaker 1
Very little, I'll say, but we do hear the horror stories and that help us sharpen the focus on not.

00:36:36:12 - 00:36:54:14
Speaker 2
I think, I think making all those various people who might get drug into the process, make them feel heard, make them feel important. Is a lot of it, too, because it's like, you know, they're trying to justify their existence. Yes. But they also want to look good, right? Like they don't want to lose that relationship with that.

00:36:54:14 - 00:37:20:00
Speaker 2
Sure. That the NFL player. Right. Yes. Yeah. That's that that's their that's their their, you know, their income, their livelihood. Yeah. So if we can help them succeed, if we can help them look good by, you know, how do we how do we find some common ground, how how can we make this thing work? Yes. It's just stepping back and putting yourself in their shoes and saying, okay, how can we all achieve our goal here?

00:37:20:00 - 00:37:31:00
Speaker 2
How can you look good and you look good? We get the house. Yes, Bill sold whatever it is. Right. Because at the end of the day, that guy wants to buy or build a house, right? Yeah. We want to build the house.

00:37:31:00 - 00:37:31:18
Speaker 1
Yes.

00:37:31:19 - 00:37:53:21
Speaker 2
And it's. So it's just navigating all these people in the middle and kind of making them feel like they're a part of the process. Just enough to get that deal done. Right. And I, I've experienced this on the back end because, you know, I do owners rep work. And so I'm, I am that guy that gets brought in to to work with the homeowner and kind of, come in and do my own inspections and walkthroughs and right heard on the builder.

00:37:53:23 - 00:38:15:22
Speaker 2
And so I, I understand what it's like as a, as an outsider being asked to insert myself in the process. And it's difficult sometimes, you know, like you have I have to make sure that when I go in, I'm not stepping on people's toes. I'm, I'm representing my client and their interests. But I'm also kind of being a part of the team.

00:38:15:22 - 00:38:36:14
Speaker 2
And saying, hey, have you thought about that? You're not doing a bad job, but maybe you think about doing it this way, you know, find, find, you know, nice ways to put things until you can't, right. And until you have to play hardball. And unfortunately, if they hired a bad builder. So you had to play hardball. But yeah.

00:38:36:14 - 00:38:46:14
Speaker 2
So it's difficult coming in. Is that that third party and being a part of a transaction that, you know, you're not financially, you know, a part of.

00:38:46:14 - 00:39:04:12
Speaker 1
You know, especially if it's a bad job, you know, we welcome people that are guys like you. It's like, man, another set of eyes we pay. What is paid is whatever they're called now, we paid them to come out and do a series of inspections for ourselves. Yeah, Burgess does it as well. Yep. And, you know, that's a little bit I see way too.

00:39:04:12 - 00:39:20:15
Speaker 1
You know, we're not perfect. We love doing that. We do all this stuff on it, but it's part of our sales pitch as well. You can hire third party. But keep in mind we also have a third party just to help us and make sure we're on our stuff. And it's money well spent, you know, because a big 7000 square foot home, you know, nothing is going to be perfect.

00:39:20:15 - 00:39:37:11
Speaker 1
There's going to be things that you want them to see, you know, that you've just missed, you know, looking straight at it, that kind of deal. I'll tell you a funny story. Since you've talked to David Cox and, I don't think you would mind me telling this, but we were at a meeting one time, and we'd called in the decorator, and she'd worked with, worked on some projects.

00:39:37:13 - 00:40:00:11
Speaker 1
Won't mention any names, but just a little bit more of a guard, a little bit more cavalier, a little bit, you know, didn't give as many cares, as many FS as people do sometimes these days, as they were said in a meeting with their clients, David kept his cool. But, you know, she starts by going, well, first of all, this roof line and, and I was not privy to the meeting.

00:40:00:11 - 00:40:17:07
Speaker 1
I was walking by. I'd already done my part, you know, getting them in the door and, David, you know, you could see the muscles right here and stuff, and he's a pretty low key guy to begin with. And this has happened to many, many a home designer, many an architect. He kept his cool and everything, you know?

00:40:17:07 - 00:40:32:13
Speaker 1
And, Bruce just could call the people fast enough, like, hey, I'm so sorry she did this and that and whatever, we could find you somebody else. And the client said, no, I applaud it. I like tension in a meeting, man. He said, we're not going to do we're not going to do 90% of the things she said.

00:40:32:13 - 00:40:54:20
Speaker 1
But she did have that one idea, and she did have that one idea. And the clients weren't offended. David was a professional, was able to get over it, you know, and it remind you, and these are some nice people. But but these people understand group dynamics sometimes better than we do. And they understand the tension sometimes, you know, just puts everybody on their guard I guess is the way to put it.

00:40:54:20 - 00:41:01:01
Speaker 1
But hearing the meeting and then hearing their opinion on the meeting where it was quite enlightening, let's say that.

00:41:01:03 - 00:41:15:16
Speaker 2
Do you guys use any, any, technology like builder, software builder friend? Yeah. And do you find that that's, a good way to help manage manage the client's expectations. Manage. Communicate communication.

00:41:15:16 - 00:41:39:16
Speaker 1
Yes. And, you know, we were an early adopter for that. Probably one of the first things that we did look into and got involved in. And when we started, we're paying a lot less than we pay now. So yeah, but they had a model where it was based upon the number of homes. And then, you know, I interviewed for a company that did technology for construction software, tracking vehicles and stuff like that, and they had 200 coders and they worked all the time.

00:41:39:16 - 00:41:58:02
Speaker 1
These were, hey, we're just here to get the software up and running. They're sitting there the whole time thinking of ways to improve it, and we see that and builder trend. So for us when we started I always got a calendar and oh yeah, we could do this. Well, world domination would not be an exaggeration of what they're, you know, probably aiming for.

00:41:58:04 - 00:42:21:19
Speaker 1
You know, they've got insurance now and they've got all of these things. But every month we're seeing things that are evidence of all these coders and people saying, hey, why don't you do this? Why don't you change the interface or whatever? And so we've taken it from kind of using it internally to we really promote that. We have project managers take pictures of jobs for clients that are in different places, you know, things like that, just to keep them engaged.

00:42:21:21 - 00:42:43:00
Speaker 1
But we use it, for the scheduling. And once our clients use it for the scheduling, no matter how much we don't want to do the schedules, we have to keep them. Kirk. Yeah. So once somebody finds out about it, hey, we notice this is a week off the bricks. Not sorry. You know, some of the projects we had, you know, it's a roll your eyes moment, but it's like.

00:42:43:00 - 00:43:03:01
Speaker 1
Yes. Okay. And what we like is it's cascading now. So you make one change and the rest of it changes gotten a lot more easy. We start doing our budgets in that even though we do fixed price, it's a real good budget module where we can roll things into pose and stuff like that. And it's part of us trying to do more with less people.

00:43:03:03 - 00:43:21:03
Speaker 1
So I have a accounting person that comes in one day a week, a CPA that I've been friends with for years. I have a marketing person that's in my office today, and those people work for me on those days, and we just crank out the work or whatever. And then I do residual work, you know, afterwards and then preparing for it.

00:43:21:05 - 00:43:42:17
Speaker 1
We outsource supervision. We have a senior project manager, but then we have a couple of other project managers that we use almost always and pay them a contract price. And, you know, contract labor is the ultimate free market incentive to good, get more, do good, get more, and so, you know, having had a bigger company and you can relate to this.

00:43:42:17 - 00:44:00:18
Speaker 1
We talked about it. And you know if if you're a people person, firing people is not part of being a people person. And if you've had to let go of 8 or 9, ten people that you became really good friends with, if you can scale it. And to me, scaling our business like that is in lockstep with the way that we build homes.

00:44:00:18 - 00:44:16:16
Speaker 1
Nobody that works for us is on those job sites, you know, 200 different people working for 40 different companies doing stuff on our behalf. And the neat thing is, and we're not building we're not playing any of those guys, but hopefully we won't have any of those, you know, times to worry about.

00:44:16:18 - 00:44:26:12
Speaker 2
I just did a, a luncheon today at GBA talking about hiring and training staff, so I should have got you on that panel to give you the opposing viewpoint.

00:44:26:14 - 00:44:29:12
Speaker 1
The jaundice view of people. People.

00:44:29:18 - 00:45:00:18
Speaker 2
So, I brought up, technology and project management software because I think, especially, talking about people having a higher expectation of, of sort of level of service, having a project management and software solution, whether it's builder trend or we had Rizzio on here last week or co constructor, whoever having that, that tool helps us deliver a better experience to people because, you know, we can easily be in constant communication.

00:45:00:18 - 00:45:17:16
Speaker 2
They can be looking at the pictures that we're taking of the job site. They can look at the schedule as much as we might not want them to see the schedule. Yeah, they can look at the schedule and see where things are at, you know, that's that's a game changer. And if you're a builder out there and you're not using a software, there's really no excuse not to do that these days.

00:45:17:16 - 00:45:26:08
Speaker 2
You know, there's a lot of good options out there for, for platform VMs, and it's not that expensive in the grand scheme of things. And it's a it's a force multiplier, right?

00:45:26:08 - 00:45:27:18
Speaker 1
It's scalable as well. Yeah.

00:45:27:18 - 00:45:29:17
Speaker 2
It's like having another employee there back.

00:45:29:17 - 00:45:30:06
Speaker 1
Office.

00:45:30:06 - 00:45:48:06
Speaker 2
Ego. Exactly. So but I think that people, especially people who are in yeah they're decision makers are in their company, they own their own company or they're high level in an organization. They're used to using project management tools and Gantt charts and all that kind of stuff. And they're professionals, right.

00:45:48:06 - 00:45:49:00
Speaker 1
My mouth. Yeah.

00:45:49:03 - 00:45:55:22
Speaker 2
And so when they're used to operating like that, you know, it just makes sense for, for their job to be run that way too well.

00:45:55:22 - 00:46:12:20
Speaker 1
And it's, you know, we don't have issues with change orders again because we're on top of stuff or whatever. That was another thing, you know, in that builders case that we took over, it was like change orders, you know, be done. And then the people get a price a month later, you know, whatever. And again, we know our clients.

00:46:12:20 - 00:46:30:05
Speaker 1
So I mean, yeah, you haven't officially signed up or sure, we're going to go ahead and do the latest because we know you want it. Be sure to sign that change order or whatever. And so we have that mechanism and it's real easy. Then when it comes time for them to get a bill on change orders because they know by our contract we're going to get that money whenever we post it.

00:46:30:07 - 00:46:50:11
Speaker 1
And, you know, check, check, check. Show them a summary of everything they approved, turned that into an invoice with one click notify client with one click, and then give them a week to pay for it. And you know, it's to your point. We buy groceries that way. We buy stuff for Christmas that way. And nobody and we're not doing it.

00:46:50:13 - 00:47:12:16
Speaker 1
And we're doing it to make it easy for them versus the other options, which is a wire for what, you know, to change order, group change, or is only 10,000 or things like that. Not everybody is wiring stuff all the time. And so we really like that aspect of it. And those are aspects that they've improved as they've gotten bigger, and it really cuts down on any kind of,

00:47:12:18 - 00:47:36:15
Speaker 1
Well, you never told me this or whatever. And we put a profit on all of those things, you know, and it's in our contract as well. Allowances. We track the same way within that system. We post every invoice for every allowance, you know, and then total it out into an invoice or a credit. And it it just cuts down the, the room for the argumentative ones of us to really, you know, say much.

00:47:36:15 - 00:47:53:17
Speaker 1
You know, I just kind of shuts it down. The one call I get, you know, so I'll say early on they want a generator and you're like, okay, 24,000. We post that change order. You know, early on we've usually put a deposit down even with our, you know, credit worthiness. And, you know, how, well, why am I paying for the generator?

00:47:53:17 - 00:48:15:06
Speaker 1
It's not going to be for, you know, six months or whatever. I was like, well, because you want a generator and because we got to get it in the process and all of these things and nobody ever, you know, responds badly to that. You know, people want to know sometimes why you're doing things. But again, hey, you're dealing with a smart money manager to be at the point where a lot of our clients are paying, you know, cash for their projects.

00:48:15:07 - 00:48:32:00
Speaker 1
And so, you know, I'm not sure if you're familiar with the book. Years ago, The Millionaire Next Door, we talked about that that that prototype a lot. And that's who we deal with. There are people that you can look up and find, as we talked about earlier, but they're the salt of the earth. They're the people that keep the city moving.

00:48:32:00 - 00:48:50:11
Speaker 1
You know, they're just in there doing their job somewhere at their law firm or at a hospital that we drive by every day. But but they're aspiring to the same things that we are in life balance, family things of that nature, you know, even empty nesters, you know, almost always have room for kids to come back to, especially grand kids, things like that.

00:48:50:11 - 00:48:57:16
Speaker 1
So it's fun, you know, in that regard, those, those, those people interactions are ones that we really value.

00:48:57:18 - 00:49:23:01
Speaker 2
So to kind of, try to wrap things up here, I wanted to talk about kind of like long term managing long term relationships with people and, you know, setting expectations with them for, hey, this is this is how we're going to take care of you once you move into your house, whether it's your warranty or how we're going to make sure that you're comfortable for the next X number of years to kind of manage that relationship, because we all want to get referrals.

00:49:23:04 - 00:49:30:18
Speaker 2
And obviously these people can be a great source of referrals, right? So how do you guys manage your, your long term relationships with clients?

00:49:30:23 - 00:49:46:10
Speaker 1
Well, we we just touched on it. Builder trend has been a great resource for warranty because they have the warranty you know, module if you will, the warranty tab. So when we're getting close to closing a home somebody has already been using builder trend. Or if it's a for sale home, you know we invite them to join Builder trend.

00:49:46:12 - 00:50:00:07
Speaker 1
And I just I think in terms of that you know all of them have an inspection. So we've already done all that before they move in. And it's think in terms of the 30 day list, just like when you're a production builder and the and the one year list, you know, so we reach out and we tell them that.

00:50:00:09 - 00:50:18:15
Speaker 1
But by that time they know where we're at. They know we're going to, you know, be there for anything that happens. So we've had that relationship that we continue to grow, and that's a great way that you put it. But more importantly, everybody in the company knows about that. So it's like, well, yeah, we call it about warranty or did that, you know, we encourage people to do that.

00:50:18:17 - 00:50:39:05
Speaker 1
And part of that is I don't think I've handed somebody a homeowner's manual, you know, and several years we post a homeowner's manual up on there. Early on in the project. We post their warranty documents up there. So we really use that builder. Builder trend emphasizes that that stuff's going to be there in perpetuity. So we're like, hey, make this your house website or whatever.

00:50:39:05 - 00:50:56:00
Speaker 1
Put your documents on there, put your warranties on there. And again, we just tie them into that early and we want them to know, hey, if you got a problem, whatever it is. Sure, I gave you a list of contractors, but if you call me that, I'm going to tell you who it is. You know, we're not going to I don't know, we gave you a list.

00:50:56:00 - 00:51:08:04
Speaker 1
Don't call us about the the Hvac guy or whatever. It's not the way to get referrals, as you would say. And, you know, we're lucky enough to have great suppliers that we think, you know, we're good marketers. For us, for the most part, the work they do.

00:51:08:06 - 00:51:26:06
Speaker 2
So long term, you know, after the sale, and, and moving forward into, into the future, you know, we want to get referrals from people. That's that I'm sure that, like us, you know, you guys get a lot of referral based business. How do we take care of these people long term to make sure that they're happy?

00:51:26:06 - 00:51:37:06
Speaker 2
They're going to spread the word about us? So whether that's, you know, stay on top of repairs or handling the warranty process, well, how do you guys manage manage that post-sale process?

00:51:37:06 - 00:51:55:02
Speaker 1
Great question. And it goes back to builder trend. You know, has the warranty module in there that we take advantage of. We point that out to people. We take advantage of the documents area. You can put as many documents in there. So there's already plans and specs and things like that. And you know, I add their owner's manual early on.

00:51:55:02 - 00:52:19:05
Speaker 1
We put all their warranty documents in there. So we've already got them. Here's the platform. And my thing is don't fill out 30 different warranty things. You know, just write it down on one, you know, even though it says one per thing and, you know, same again, going back to the way production builders think, that 30 day window after 30 days, what are the things we notice that we didn't catch when we you or what did you know some people do while they were moving and that you just can't, you know, live with.

00:52:19:06 - 00:52:34:22
Speaker 1
And then that one year point, you know, get everything in, get your paint done, whatever kind of thing. And we're not afraid of that. You know, it's it's amazing. We've had clients that, you know, didn't use a realtor. They bought a, you know, a home that was already, you know, that we had built and use a realtor and didn't do an inspection, you know.

00:52:34:22 - 00:52:48:13
Speaker 1
And I remember the conversation. She was like, hey, well, you guys are good builders, right? You know what I mean? Do we need to spend the $700? I'm like being I'm probably not the best person to ask, but we have done a good job. It, And it's a house of people live right next door to Bruce, though.

00:52:48:13 - 00:53:06:21
Speaker 1
Les. I figure they live next door to the builder. But, you know, that's something I mentioned to you. When I started working for Bruce in the townhome business, we were eating down off of Washington. And, you know, we're building on every street over there at one time, you know, name of street off of Washington. We probably built some townhomes there, 50 or 60 units a year.

00:53:06:23 - 00:53:23:16
Speaker 1
We're standing there getting lunch one day, and I'd start with them. I'd say, hey, by the way, is anybody going to walk up to us with a bone to pick? And it looks like he's so far so good. And that's hard to do, you know, especially in the townhome business, you know, and and so, you know, something that I still pride myself on.

00:53:23:16 - 00:53:42:12
Speaker 1
You know, we don't have to hide from anybody. We do a great job for our clients. There's it's never perfect. I mean sometimes we have to remind them and be firm about something and vice versa, you know, so you'll understand this. We're building a one of a kind prototype, but it's not a prototype for anything in the future.

00:53:42:16 - 00:53:58:06
Speaker 1
Right? You know, we're building at one time, warts and all. Whatever it is, figure it out. A bunch of new stuff. So it comes with its own challenges. But, you know, Bruce lives in the neighborhood. He lives over in the River Oaks area. And I'm proud of that because he's earned it. You know, he's been working hard since he was a young man.

00:53:58:06 - 00:54:16:07
Speaker 1
He knew what he wanted to do. But I feel like that if you're going to build homes like that, somebody in the company needs to know what living in a home like that is and what the challenges are of living in town. You know, I grew up in town, so I know all those things, but I live out in the burbs, out in Tomball, as we talked about.

00:54:16:07 - 00:54:28:09
Speaker 1
So I don't aspire to live in town. But man, if I worked here and needed to be ten minutes away from the job, or I was building at 5 or 600 an hour, you know that that motivates a lot of people we deal with.

00:54:28:09 - 00:54:56:13
Speaker 2
So absolutely. Yeah, I think I think having builder and co construct ratio, any of these softwares, they all have a great warranty module. And one of the things I tell people is that, you know, our settings actually remind us, hey, the one year warranty is coming is coming up. Or we can see a warranty expiration report. And so we'll reach out to people and say, hey, Mr. Homeowner, your warranty is expiring, in a month.

00:54:56:17 - 00:55:13:14
Speaker 2
Let's go. Let's do a walk through, like or you walk through some your list of stuff. Let's, again, it goes back to making sure they feel like they're being taken care of all the way to the end. And I'm. I'm just not going to let the warranty expire and poof, it's gone. And sorry. You know, we're done now.

00:55:13:14 - 00:55:13:17
Speaker 2
We're a.

00:55:13:17 - 00:55:15:03
Speaker 1
Week left. Yeah, exactly.

00:55:15:04 - 00:55:38:22
Speaker 2
So it's if we if we remind them, hey, your warranty period's coming up. And by the way, if you warranty expires, I'm still going to take care of you. You know, if something breaks, you know, might charge you a nominal fee to fix it. Or maybe I won't, you know, but, if they see that we're on top of of reminding them that the that expirations coming up.

00:55:39:00 - 00:55:41:00
Speaker 2
Yeah, that they appreciate that. Oh one.

00:55:41:00 - 00:55:57:20
Speaker 1
Hundred percent. And we, pride ourselves. You know part of our pitch eBay. Hey, you could pick out any house on our website and we could probably get you into that house because we, you know, told all these folks, this is the way we sell stuff. You know, there's not a rich person's model home park, but if somebody wants a home like yours, could we bring them over there?

00:55:57:20 - 00:56:31:13
Speaker 1
You know, and, part of our contact is pictures are king in our business. I noticed you had a lot of great product pictures out front, and that's the representation of what we do. That's your portfolio. So we, you know, kind of as a rule, after six months, we reach out, hey, here's the furniture such that we could come out and take photos and I or Bruce make it a point to go to every one of those appointments, because seeing the home after people have lived in it is its own affirmation, you know, got all the problems, all of this figuring out the, you know, when retaining or when retention was a was a, you

00:56:31:13 - 00:56:46:15
Speaker 1
know, water detention was a thing. You know, we had projects like that that were hoping to get away with not doing it and stuff and all that stuff is just a big problem. And then when you see the people living there, it's like, man, that stuff is not anything about this house. You know, it's a home for these folks.

00:56:46:15 - 00:57:03:23
Speaker 1
And it's trite, you know, but it really is that at the end of the day. And that's where a builder gets his affirmation. There's not a bunch of people like your applause coming in or anything like that. It's maybe you and your dudes in the office kind of part. Each other on the back on a Friday going, man, I can't believe we did that.

00:57:03:23 - 00:57:09:12
Speaker 1
Nobody knows how hard that was, you know? Yeah. And to do it with a smile, you know, to do it with a smile.

00:57:09:12 - 00:57:27:18
Speaker 2
Absolutely. All right. So to kind of wrap things up, I just wanted to ask what your, what's your advice would be to, other builders, young builders who want to kind of elevate their game and kind of move in to a higher price point. You know, what what advice would you give a guy coming up that says, hey, I want to build that kind of house.

00:57:27:18 - 00:57:45:12
Speaker 1
Yes. Don't do it. No. I you know, I'm not a builder. I'm a homeowner, I'm a DIY or with a little bit of knowledge, but, it helps me do what I do, not knowing the trouble. And the nuances. And we'll have things happen. I'm like, Bruce, we're good builders, and we're still, you know, having to deal with this.

00:57:45:12 - 00:58:18:18
Speaker 1
What are bad builders doing? And some of the things we come up with is they don't care. They don't worry about these things like we do because they don't know what the standards are. So my my advice would be, and you alluded to your own arc there, you know, baseball, tennis, golf, all those sports analogies come back to sure, you can have a knack for something or a certain skill that God gave you, but if you don't work on that skill and repetition is the number way to number one way to improve that skill, you're probably not going to be as good a builder as we are.

00:58:18:18 - 00:58:45:00
Speaker 1
You're going to get jobs and stuff. Heck yeah man. I guys leave production builders all the time and start a custom homebuilding business and and work their way into it. But you know, it's one of those things that not everybody that's good on the science and that's the building part that you've had a lot of discussions about, and that you understand the guys that are always real good on the science aren't always real good on the art, and those are both very important elements on the luxury level.

00:58:45:00 - 00:59:04:02
Speaker 1
And Bruce happens to have great taste. He lived in a home at Tanglewood that he built for himself. He's lived in townhomes that he's built for himself. The home he has now was recently featured in French Country magazine. We had probably four containers of material we brought over for that house from Europe, you know, coping around the pool lights, all of these things.

00:59:04:04 - 00:59:19:20
Speaker 1
If it would have been during Covid. Oh my gosh. I mean, even back then, you know, sitting on a tanker out in LA for 2 or 3 days or sitting on a, you know what, 300 bucks a day? I mean, it was dicey at times, but the end product, you know, we're not getting a lot of demand for a French country right now.

00:59:19:22 - 00:59:34:14
Speaker 1
But the end product was what Bruce and his wife had dreamed about. You know, it was a life's work. And, you know, we were talking earlier, and it's one of those things that kind of helped him be a better builder because his wife was like, do you guys do this all the time? Man, that's a little bit sketchy.

00:59:34:16 - 00:59:53:06
Speaker 1
Bruce is like, he's golly, we got to go, you know? Whatever. Now, now, granted, it was a little bit of a stepchild situation. You know, she they weren't getting the attention of the Winfrey family. You know, from all of us that that some of these other jobs were. But to me, you know, that kind of thing is, is a sales story that is not contrived.

00:59:53:06 - 01:00:10:16
Speaker 1
I mean, that's a legitimate story where this person lives in a luxury home, understands you and the way your family things, understands the density and some of the worries about safety and things like that, you know, so, you know, we just use that to our advantage. But at the end of the day, it's all the same things that people are wanting.

01:00:10:16 - 01:00:12:20
Speaker 1
You know, in a home. It's just a different scale.

01:00:12:22 - 01:00:20:03
Speaker 2
I'd actually also also add to that, for for people who are wanting to come up, is don't bite off more than you can chew.

01:00:20:03 - 01:00:20:21
Speaker 1
Right. And yeah.

01:00:20:21 - 01:00:35:10
Speaker 2
That's I mean, you know, when you talk about having to take projects over. Yeah, I would say most of the ones in that situation that we've had to step into are people who just bit off something way more than they were capable of executing. Yeah, it's like everybody wants to build the big house.

01:00:35:10 - 01:00:39:15
Speaker 1
Buildings, build a 5000 just like to. And it's not a no.

01:00:39:15 - 01:00:52:09
Speaker 2
It's it's really not. And so I think people, they want those big jobs, they think they're glamorous. And so they, they, they get in these situations and they kind of over promise. Yes. And under deliver.

01:00:52:09 - 01:00:52:21
Speaker 1
Yes.

01:00:52:21 - 01:01:00:21
Speaker 2
Yeah. And and that, that you know when, when you are with a, a premium buyer and you're under-delivering that's a problem.

01:01:00:21 - 01:01:16:04
Speaker 1
Yes. And you know, you don't know what you don't know in those cases. There's a lot of people that are great on the presentation of their skills, but the skills are not there yet, you know, so they know how to sell the service. They know in theory what it's going to be. And it goes back to that repetition.

01:01:16:04 - 01:01:34:18
Speaker 1
And this is one, you know, kind of a question I'll ask you that we're always amused by people that, you know, have become prominent or people that we've competed against. And, you know, look at all their websites. I want to know what's going on in the bio. So-and-so finished a house for his parents because something, something happened and he's an idiot by trade.

01:01:34:18 - 01:01:51:07
Speaker 1
And he's done eight houses since then. I'm like, man, is that guy can do as good as my buddy who built has built 6 or 700. And a lot of those have been very high end, you know. And the answer is, I don't think so. But those guys are still getting work in Houston because of who they know.

01:01:51:09 - 01:02:05:22
Speaker 1
And, you know, we have times when we're on a street and we've had 2 or 3 projects, oddly, on the same street, and somebody will drive down that street and take out one for each everywhere, you know, three streets over. They don't even know our name. You know, a project will start. I'm like, how would they not call us?

01:02:05:22 - 01:02:23:04
Speaker 1
It's like two houses down. And it's like, well, at least they might have known somebody from church, or they might have known somebody from the club, you know. Right. And, you know, that's the thing that's most frustrating when you're just knowing that you could do a good job, but you don't have those connections with the people you want to build them all, you know?

01:02:23:06 - 01:02:50:06
Speaker 2
Yeah, exactly. Well, Greg, thank you so much for for being here today. It's it's been a great conversation. I always love seeing you. Same here. And, I think that, you know, sorry to kind of, kind of back up a second, you know, important thing to note if you're a kind of a younger, newer wanting to move up is, is, you know, take the time to hone your craft at various levels before you take that next step up.

01:02:50:06 - 01:03:06:10
Speaker 2
And that's and that's the case with every price range, as you're kind of sliding up it up into if you're starting with bathroom remodels and kitchen remodels, go to whole house remodels, go from $300,000 houses to $400,000 houses. Don't try to make that giant leap.

01:03:06:10 - 01:03:07:04
Speaker 1
Yes,

01:03:07:06 - 01:03:18:23
Speaker 2
In in price point because, man, it's just a whole different animal in, client relationships and also and the ability to execute. But I would also add to that the level of your subcontractors.

01:03:18:23 - 01:03:20:11
Speaker 1
Huge. That's the biggest thing.

01:03:20:12 - 01:03:27:18
Speaker 2
Different subcontractors on a $50,000 bathroom remodel that on a 2 to 2, three, $4 million custom home.

01:03:27:18 - 01:03:47:08
Speaker 1
Well, and to your point to make a point on that. And it's something that we emphasize again in our sales, bump feel upset about Don Shula. These are some names from the past. Football names for the past. Two great coaches. But, Phillips had one time about Don Shula. He can take his and and b urine, and he can take urine and beat it.

01:03:47:10 - 01:04:02:01
Speaker 1
And that's what I feel about Bruce. Give him the same pile of stuff, the same pile of pieces, and is possibly going to build a better house and another guy with the same pile because of what he knows and because of his intellect. And that's what I would say to a young guy, and you and I are privy to this.

01:04:02:03 - 01:04:26:00
Speaker 1
There is no greater organization in these modern times than the Builders Association, that putting all the tools out there for a young guy willing to craft, to hone his craft, and that is become a credit to take the classes that GBA offers. But educate yourself. I mean, you know, Bruce's bookcases in our office now, and it's books on architecture, it's books on Texas layouts.

01:04:26:00 - 01:04:45:15
Speaker 1
It's books on French, you know, landscaping and things like that. It's just stuff that I see that I know he's flip through for inspiration. That's developed the intellect that he has now, you know, to advise people and to many guys, you know, like you said, young man in a hurry. And this is just not a business unless you, you know, have a lot of money to buy your way out of a lot of problems.

01:04:45:15 - 01:04:55:01
Speaker 1
You know, it's not a business where you can learn on the fly. Like you said, you need to start and master what you're doing and then move that next level up. It's great advice, great.

01:04:55:04 - 01:04:58:07
Speaker 2
It's a great way to wrap it up. Thanks, Greg. Appreciate you being here.

01:04:58:07 - 01:04:59:07
Speaker 1
Yep. Great to see you.

01:04:59:07 - 01:05:04:05
Speaker 2
And thank thank you to all of you for listening today. And we hope to see you on a future episode. Take care.