15:03:49:08 - 15:03:58:04 Unknown Okay, 31 I am. All right. 15:03:58:06 - 15:04:29:14 Unknown Hey, everybody, welcome back to the Your Project Shepherd podcast. I am your host, Curtis Lawson, and I'm here for another solo episode where you just get to listen to me all by myself without the pleasure of having an interruption of somebody else. So, anyway, last, last episode, that I did so I talked about, a sunk cost fallacy and then kind of toward the end of that, I got into talking about, subcontractors and employees and how sometimes we just kind of stick with the subcontractor even after we should have moved on. 15:04:29:14 - 15:04:54:16 Unknown So that kind of got me thinking about doing a whole nother, episode, basically about, having the right subcontractor for the job, for where you're at in your and your, kind of your level, your path as a builder. Because I think a lot of the times, we as builders, you know, kind of we, we get some money that we like to use and we stick with them. 15:04:54:16 - 15:05:15:20 Unknown Maybe beyond when we should have maybe moved on and kind of upped our game with somebody else. So I think this is really important because you're only as good as your worst subcontractor. Just like in sports. I'm sure that you've heard the analogy. Sports team is only as good as their weakest player. And this is absolutely the same when it comes to construction. 15:05:15:22 - 15:05:41:23 Unknown Having a bad carpenter or a bad drywall guy can make your finished product look awful. Having a bad foundation guy or bad framer, that instantly affects everybody that comes after them. So you're starting off with bad trades. You're going to end with a bad product, or everyone else after that is going to spend all their time just trying to kind of cheat things and make things work and look good, even when you're just not starting with a good, a good base for them to work off of. 15:05:41:23 - 15:06:05:17 Unknown So, you know, there's a there's a really big difference between a experienced high end builder that has really appropriate high end trades and a guy who just kind of wants to be a high end builder, but he's trying to accomplish that using cheaper trades, cheaper subcontractors or vendors. And he just he never quite gets there. So here's what I see happening. 15:06:05:18 - 15:06:43:14 Unknown Kind of two two situations here. Number one, and I think this is probably the most common, the level, the level of the subcontractor or the vendor doesn't grow with the builder. So, and I did this to builders generally start small. Most companies start small, right? Most builders start with small projects. And I think a lot of remodelers especially kind of start in the world of, you know, we're going to do small jobs, maybe, you know, siding paint and you move into doing baths, kitchens, whole houses, and then eventually you're doing additions. 15:06:43:16 - 15:07:07:11 Unknown Then maybe one day you're like, I want to try to build a new house. So we start small, maybe cheaper new construction, and then we kind of move up the ladder. So we're doing better and better, bigger and bigger levels of projects. So it's kind of a natural progression, right? But when you're small and starting out and you're trying to keep your budgets down, you're trying to get those first few jobs, you know, you want your prices to be low. 15:07:07:11 - 15:07:26:05 Unknown It's it's common. And so you're generally using subcontractors who are kind of one man operations guy working out of out of out of his truck. You're probably working out of your truck at that point, too. And so you're, you're using these small guys to keep your prices down. And a lot of those guys are fine, for for what they're doing. 15:07:26:05 - 15:07:54:19 Unknown I'm not. I've never been one to knock somebody who's doing that, that type of work, because there's an appropriate, there's an appropriate level of sub. There's an appropriate level of of everything. Of everything. Right. Not all the expensive guys are a good fit for small projects. So anyway, builders will start with, the cheaper subs may be fine for what they're doing at the time, as they grow, they tend to hold on to those relationships. 15:07:54:21 - 15:08:19:18 Unknown And a lot of times, that guy who is doing your, painting your carpenter, your tile work on that little small remodel job just isn't capable of pulling off those those larger scale projects, whether it's the size of the project. And he doesn't have the manpower to handle a project that size, or whether it's, you know, as houses get bigger, more expensive, the designs get more complex. 15:08:19:20 - 15:08:39:16 Unknown He's just not he doesn't have the knowledge base to execute that. And so when you're, as guys grow there and they're doing these bigger and bigger projects, they're sticking with these guys and they start to get complaints for customers. You know, this is not what I expected. This is isn't the level finish that I signed up for. 15:08:39:18 - 15:08:58:12 Unknown But the builder maybe doesn't know any better. Either he doesn't personally know, how to teach, how to tell coach that subcontractor to get where they need to be, because he doesn't personally know how to do it. So. And this is another common thing. People just trust their subcontract is to do what they're supposed to do. 15:08:58:14 - 15:09:20:08 Unknown They don't have the knowledge to to, to coach, bring up those people. So they're kind of relying on their trades. Again, you're only as good as your worst as your worst trade on the project. So anyway, as companies grow, they're sticking with these guys and, subcontractors. I hate to tell you, they can't do something. I don't know how many times I've heard, 15:09:20:09 - 15:09:33:18 Unknown Oh, yeah, my brother can do that. My cousin can do that. I can do that. I did that last week for somebody else. Right? I hear this all the time where the guy's like, yeah, I can do that. I can do that. But he doesn't really know how to do it either, you know? And he doesn't know how to do that either. 15:09:33:18 - 15:09:51:09 Unknown Just like you know, maybe the contractor doesn't know what he's doing either. So everyone's kind of like talking themselves up, but they've never done it. They're not quite capable. Capable doing it. But but they believe they can do it. So, you know, anyway, these subcontractors will. I can tell you. Yeah, I can do that. I can do that. 15:09:51:09 - 15:10:18:00 Unknown I can do that. And again, if it's something that you're not personally familiar with, if you don't know how that works, you're at their mercy and you're kind of crossing your fingers and just hoping that they can pull that off. Now, I'm not saying that all subcontractors are going to be kind of stuck like that. I've got several guys who have been with me for a long, long time who grew and learn and learned as I did. 15:10:18:02 - 15:10:37:20 Unknown I've got an electrician that's been with me for, I don't know, 12 years. And he started off as a 1 or 2 man operation doing my small projects. And now he has a very large crew executing some very high end projects. So he he's been a great resource. He's grown with me. I have a countertop fabricator that I've been using for. 15:10:37:22 - 15:11:03:19 Unknown Oh, gosh, he was probably the first the first countertop fabricator that I ever used. When I started remodeling in 2004. And he's grown with me to, like, he has gone from basically fabricating countertops out of his truck to having a full shop with a CNC set up and, you know, he's he's fantastic. So, you know, not all subcontractors are kind of stuck, like, at a certain level like this. 15:11:03:19 - 15:11:29:11 Unknown Just like, just like not all builders are stuck on a certain level, but, you know, those guys have invested their time in training, they've invested their money in equipment. And you can tell the difference between those guys who are wanting to grow with you and those guys who are kind of stuck where they're going to be. So, you know, but my, my, my advice there is as you grow, as you take on bigger projects, you've got to find the subcontractors who are capable of moving up with you. 15:11:29:11 - 15:11:53:10 Unknown So all right. So that was situation number one. A guy who, just has subs that kind of are stuck on a certain level right here. Situation number two. A builder is trying to keep a budget down for the client, and so something has to be sacrificed to get that budget down. Right? The client is like, man, I got a I got a one $1 million budget and you're at 1.2. 15:11:53:10 - 15:12:15:10 Unknown What can we do to get that price down? Or maybe you're competing against another builder and you feel like you've got to be a little bit cheaper, right. And so something has to be sacrificed at that point. So very commonly they will just, you know, if they're bidding that out to 2 or 3 subs, they'll pick the cheaper sub, maybe they'll try somebody new they haven't used before just to get that price down. 15:12:15:12 - 15:12:39:22 Unknown And they think that maybe that sub is just good enough to get it done. But, you know, the question is what is the customer expecting? If that customer is spending a lot of money, if they're spending a million bucks, 2 million bucks, I mean, even if they're spending, if it's a kitchen remodel and they're spending $100,000, $200,000 on a kitchen remodel, they probably have a little a level of expectation for what that's going to look like. 15:12:40:00 - 15:13:05:11 Unknown And, you know, is that subcontractor actually capable of of pulling that off for that price? So, it's not just the level of finish. Right? So it's not just a, a painter who can who can execute a fine finisher, a tile guy who can make really straight joints. A lot of times it's something that can really hurt you later and, you know, finishes things like that that might that might hurt you. 15:13:05:11 - 15:13:25:08 Unknown Now he had to go back and redo it or fix it or have somebody unhappy with the finish. But the real danger is when you hire a trade, like a mason or a framer or a roofer or somebody that's doing something structurally or something that's going to be related to the building envelope, you know, stuff that goes into the realm of building science. 15:13:25:10 - 15:14:03:23 Unknown So those kinds of problems, if you got a problem with your insulation, your air conditioning, your, your wall system, that's the kind of stuff that you don't find out about for a couple of years, maybe until there's a real problem and there's, like, black stuff growing in the walls. And you're in a lawsuit. So, you know, what I found is that if you take the time to explain the difference to your customers between levels of, of vendor materials, subcontractor, whatever it is you to take, if you really take the time to explain to them, this is what you get for this price, this is what you get for another price. 15:14:03:23 - 15:14:23:22 Unknown This is what I recommend. I wouldn't do it this way. At the very least, you're setting the expectation with the customer so that if they if they if they're like, yeah, I got to save money, go with the cheaper option. At least you've already explained to them like what they're getting and you're setting the expectation for you know, that finish isn't going to be quite as nice as this other one. 15:14:24:00 - 15:14:56:15 Unknown Or, you know, you may have some, some water issues if you go that route. Right. So you're setting an expectation for finish. You're also setting an expectation for performance. And I think that that helps, you know, protect your relationships. It can also just kind of help protect you in the future on a legal basis. If you have a record of that client, you know, choosing that that particular, product finish or whatever it is, you can kind of go back and say, you know, you know, you get what you paid for. 15:14:56:15 - 15:15:13:11 Unknown But I offered you a better option. You chose to do something else a smarter way. The way that I, that I prefer is you just don't even give them that option of that cheaper stuff like you explained to them. We do it at this level, and this is the reason that we do it at this level, if you like. 15:15:13:11 - 15:15:35:14 Unknown I won't do it at that lower level because I've seen what happens at that price point. So, consumer education just goes a long way on that kind of stuff. You know, and if they don't want to spend more, if they want to hire the cheaper guy to do it, and then maybe you dodged a bullet on that, you know, you know, not every job is the right fit for every builder. 15:15:35:16 - 15:15:57:23 Unknown But I do feel that it's our job as professional builders to educate people on these different levels of things and what they're getting. It's also our job as professional builders to have, subcontractors who are capable tradespeople, who are capable vendors who are providing the products that are capable of creating the experience, the the end product that the homeowner is expecting. 15:15:57:23 - 15:16:33:07 Unknown So a big, a big part of what we do is just setting expectations. And actually, that's another great topic for, for the next episode. I might think on that here for, for a few days and and do, do a whole another one of these about customer expectations because, it's, it's so important like, setting expectations and defining exactly what it is that you're providing the client, is essential because, if again, if they're expecting, you know, this, this level up here and you're delivering something down here, there's going to be disappointment, there's going to be conflict. 15:16:33:07 - 15:16:56:16 Unknown So it's it's setting expectations, but it's also, defining in your in your contracts and your scope documents exactly what it is that you're going to deliver. So I actually did a little, I'm pretty sure on one of the previous episodes I did this, this example, and I've used this example before in teaching people about, writing in scopes of work. 15:16:56:18 - 15:17:17:20 Unknown But you can, you know, a set of drawings that has a just a bathroom, for example, just a little powder bath. It's like five feet, you know, eight feet long by four feet wide, let's say 32ft². That little small bathroom just drawn on paper on an architect's plans. It's got a sink and it's got a toilet. 15:17:17:20 - 15:17:42:17 Unknown Maybe it's got a cabinet, maybe not. Maybe it's the pedestal sink. I don't know, but it's just this basic, two dimensional line drawing. And so the expectation in your mind might be, hey, we're putting a cabinet, a sink faucet in a toilet in a light. We're calling it in a mirror. We're calling it a day. Right. But when the customer sees that, or when the designer sees that they have this whole other mental picture of what they're going to be receiving. 15:17:42:19 - 15:18:21:21 Unknown So it's really important that everyone's in alignment on what's being provided. So, they're not expecting wallpaper and a wall mounted faucet and an antique mirror and $1,000 toilet. And you know that, whereas you're expecting, you know, basic finishes. So that's a big area of, conflict. Or it can be so setting expectations, having the right trades to execute what the expectations are, and having everybody on the same page and having things well defined in your contract, can help head off, a lot of headaches, as you go through the construction process. 15:18:21:21 - 15:18:43:01 Unknown So again, that'll be a whole nother episode that I do. I think because I like that topic a lot. But, yeah, I think that's all for today. I hope you found this discussion, helpful about, hiring the right subs and setting expectations, on what they're capable of executing. So I hope you enjoyed these. 15:18:43:03 - 15:18:50:19 Unknown So episodes. I enjoy doing them. And, join me next time. We'll do it again. Thanks. Okay.