The Rising Tide

Eric Hoff was confused and, frankly, a little nervous. Moments before, the young owner of E.R. Hoff Remodeling, Boise, Idaho, had been cruising along when the driver of a silver Ford extended-cab truck honked the horn and pulled him over. Hoff recognized the truck as that of Jim Strite, owner of Strite Design + Remodel and one of the most successful remodelers in the country. Hoff steered his vehicle to the side of the road, whereupon Strite “rolled his window down and said, ‘I want to take you to lunch sometime.' I had no idea why,” Hoff recalls, “but he was so friendly I couldn't help but take him up on the offer.”

Chad Vincent (left) and Eric Hoff (center) credit much of their success to mentor and fellow remodeler Jim Strite. “Jim doesn't want other companies ruining our reputations by doing something that jeopardizes all of us,” says Vincent.

Photo Credit: Compoa

The reason why soon emerged. The two had recently submitted quotes for the same project, and the prospect had shared Hoff's quote with Strite. “I knew what [Hoff] was up to,” remembers Strite, and “I thought he deserved to be compensated for not only the product he was proposing but also for his knowledge.” So at the lunch, he asked questions that struck Hoff as personal — specific questions about his gross profit and hourly rates, among others. “I was thinking, ‘That's none of your business,'” says Hoff. “It was nerve-wracking.” He shared nevertheless because Strite, it turned out, was willing to open the books on his own business as well. Hoff quickly realized he had a lot to learn and a willing teacher to help him learn it.

That was several years ago, and it led to an extended, mutually rewarding dialogue that continues to this day. Hoff now considers Strite his mentor, the person who taught him how to talk about money, encouraged him to try new things, and, more than four years ago, welcomed him to his staff as a remodeling consultant.

Looking back, Hoff understands why Strite pulled him over that day, and why he has mentored many remodelers over the years. “His goal was to see my company become successful,” and, one remodeler at a time, to strengthen the remodeling industry overall.

Builders have construction management programs, restaurateurs and innkeepers have hospitality programs. But remodelers? Given the near total absence of specialized business training, most remodelers learn their way by either fumbling along on their own or working alongside a more experienced colleague. “Within this industry, we somewhat have to grow our own,” says Eric Souder, a longtime designer who recently joined Butler Brothers, a remodeling firm in Clifton, Va. “There's not a lot of book training, and it's hard to teach what the business means” when a day's work can run from well-groomed face time with clients to “putting on your boots and crawling around in the field.”

Don Van Cura agrees. “We were sort of left out in the dark when it came to formal education,” says the owner of Don Van Cura Construction in Chicago. In the old days, he observes, the apprentice system produced many fine carpenters and, in fact, “years ago remodelers were carpenters. Now we have to be psychiatrists, attorneys, and scientists,” charged with responsibilities as disparate as psychoanalyzing clients, writing bullet-proof contracts, and analyzing the chemical content and safety of building products. “The sheer quantity and variety of things that we have to be aware of can be overwhelming,” he says.

Mike DuKate of DuKate Fine Remodeling, Franklin, Ind., remembers that feeling. He says he didn't have a clue what he was doing when he started his business in the late 1980s. “I wasted so much time. I read articles, rented videos, did things wrong.” He surmises that if he had then known the successful remodeler who later became his mentor or had joined the peer-review group he now belongs to, “I could have been light-years ahead.”

The absence of formal education is compounded by naiveté. “I'm fairly bullheaded,” says Chad Vincent, another Boise remodeler whom Strite took under his wing. “And I think most people who start their own businesses are in the same category — they think they can do it on their own.” When he launched Renaissance Remodeling in 1997, Vincent assumed his experience as superintendent of his parents' company was sufficient preparation for running a business. “I just went for it,” he says.

Reality intervened when Vincent bid on a sunroom project in the nearby community of Eagle. He says he was afraid to talk about money, so he gave a free quote of $32,000, then quickly thanked the homeowner for the opportunity and left. Ultimately, Strite Design + Remodel got the job for closer to $75,000, “and I could not believe that someone would sign a contract for twice as much money. I realized at that minute that there's always a limit on someone's budget, but their decision has more to do with whether you have the confidence to do the job.”

Strite says this kind of inexperience is the bane of the industry. Too often, upstart remodelers “go out and start their own business earnestly thinking they can do that job for X dollars,” he says. They know from their last job what the going rates are, and “they think they can pick up that $15 an hour difference without any idea of the managerial or operational challenges. They don't have any systems or procedures, they're never on time, they don't follow through.” To stanch their financial losses, they take increasingly desperate measures, like cutting corners and making impossible promises that infuriate homeowners and feed negative public perceptions.

Vincent has his own theory of why Strite invests so much time mentoring other remodelers. “Jim doesn't want other companies ruining our reputations by doing something that jeopardizes all of us.”

Mentoring relationships take many forms, but the strongest are characterized by open doors, open communications, and open books. Most of the mentors who we spoke with have informal relationships (some also offer paid mentoring services) where their “mentees” are free to call or arrange a get-together whenever they need a sounding board or, as one remodeler put it, “a shoulder to cry on.”

Linda Case, whose company, Remodelers Advantage, facilitates peer-mentoring “roundtables” and offers one-on-one coaching, believes this openness usually comes with time. “I think many people who get through the field and have created a successful company have a really strong urge to help others avoid the pitfalls,” particularly when the others will remain with the company after they're gone.

Kelly Vogan of Vogan Associates, Silver Spring, Md., says one such person was his dad, Sam, a skilled carpenter and builder. Even when he had almost 60 employees, the elder Vogan “always took the time to show anybody who was interested” how to use the table saw, for instance. Sam's integrity and work ethic also had a major influence, not just on his son but on other staff as well. “Dad used to tell me, ‘If you have nothing to do, pick up a broom and sweep, restack the lumber, look busy.'” Some of his dad's longtime employees still work with Vogan, and they all have “incredible work ethics. I call them the disciples of Sam.”

Strite also mentors his employees by example. “I always say I don't even take stamps from the company because I'm the owner.” Working one-on-one, he systematically taught Hoff how to sell prospects on the value of the company's work, helped him get through difficult personal times, and encouraged him —and his co-workers — to gain further education through NARI and other organizations.

When Strite's mentoring extends beyond the company, he doesn't give remodelers the answers so much as ask questions that help them find the answers on their own. Vincent remembers telling Strite he was struggling to get projects and needed new clients. “He said, ‘Where's your written marketing plan?'” Or Vincent would wonder if he was charging the right amount of money, only to be asked, “How much do you know about your financials?” Not surprisingly, Vincent's response that his checkbook “has some money in it” led to further questions.

Indiana remodeler Walt Maxson mentored Mike DuKate, who later became a mentor to Chan Cornett.

The mentor DuKate eventually got was Walt Maxson of Maxson Remodeling & Construction, whom he calls occasionally to, for instance, borrow a form, learn how to space appointments, or ask for permission to sit in on a staff meeting. About a decade ago, DuKate carried on the tradition by becoming a mentor to Chan Cornett of Cornett Roofing Systems. The relationship isn't always pats and platitudes, nor should it be. Before, says Cornett, “my pattern would be to ask people who would say what I wanted to hear. Mike isn't one of those men, and that's why I respect him. He's always kept me at a higher level.”

In a recent example, Cornett declined a lucrative project on DuKate's recommendation. “I turned down a large roof in Indiana in January based on how much I trust this relationship. I would consider Mike a part of my inner circle for any major decision.”

Many mentoring relationships take the form of peer groups. About a decade ago, Don Van Cura and a handful of other Chicago-area remodelers formed the “Underground Breakfast Club,” which has since morphed into a dinner club. They meet monthly at one member's office, take a few hours to discuss a mutually agreed-upon topic, then have dinner provided by the host.

The Abundance Mentality

While every good remodeler is a good teacher, most hoard details about costs and profits out of fear that an employee will become a competitor or a competitor will unseat him. This is antiquated thinking, says Clay Nelson, a business coach. “There's no better feeling than bidding against people you trained at one point or another,” he says. It's self-defeating to refuse to teach anybody who is or could become your competitor. Why? “Because they'll keep your edge sharp.”

Case agrees. “Nobody is so smart and so good that you can't pick up something from another remodeler. Am I going to give something that's a huge competitive advantage?” she asks hypothetically. “No. But if someone asks how you get a P&L statement or your job costs in order, I'm so far beyond that that it's like a chef telling a newbie how to boil an egg. I'm really not giving away anything that's going to sink the boat.”

The fact is, says Case, “competition has very little impact” on remodelers. Echoing Strite, Nelson states emphatically that “our job as successful remodelers is to create the space for more successful remodelers to show up. I don't care where you are, but they need more remodelers.” Nationwide, remodeling expenditures totaled more than $233 billion in 2003, according to the Joint Center for Housing Studies at Harvard University. Most signs point to continued growth, including rising homeownership rates, aging housing inventories, and rapidly growing home values and owner equity.

“The market is pretty well unlimited if we can get rid of the negativism of the remodeling experience,” says Strite. “I'm coming from an abundance mentality rather than a scarcity mentality. Even if another remodeler has the same information I do, it won't be presented in the same manner. I can give them my whole pricing structure, my markups, my agreements, and still we won't be the same because they're not collecting the same direct costs as I am, nor are they looking at the project the same way I am.”

What if the other guy wins the project over Strite Design + Remodel? “Good for them,” says Strite. “It means either that wasn't a good client for us or I need to improve. If I can raise their bar, it's going to raise my bar.”

How big a difference can a mentor make? “It's huge,” says Linda Case. “The amount of time and money a mentor can save you is amazing. Conceivably, you can find that tip in a book, but there's nothing like finding another person who's been in the trenches like you.” Tips for finding that person:

• Make the call. If you admire a more experienced remodeler, don't let pride keep you from inviting him or her to meet you for coffee. Chances are he'll welcome your interest and may even pass on leads for smaller jobs. Also consider suppliers and other associates. Chan Cornett credits a roofing supplier with telling him about Certainteed's Contractor Program.
• Join a nearby industry group, such as your local chapter of NARI (www.nari.org) or NAHB's Remodelors Council (www.nahb.org). Getting involved with NARI “was one of the best things that happened to me,” says Eric Hoff, echoing a popular refrain. Then be active. “If you don't go to the meetings and get acquainted with people, you're missing the big part,” cautions Don Van Cura.
• Hire an expert. Remodelers Advantage and Business Networks are two of the best-known consulting firms that offer paid coaching services and peer review groups.
• Form an informal breakfast club. Or a dinner group. Or a lunch bunch. Numerous remodelers' groups meet periodically at local restaurants to discuss topical matters or tap into the collective knowledge.
• Shadow a more experienced coworker. “My dad told me, ‘if you want to do well in this business, watch the guy ahead of you,'” says Kelly Vogan.

Don't be intimidated by the idea of mentoring, says Dr. Linda Phillips-Jones, principal consultant of The Mentoring Group, which helps large employers set up programs. “The stereotype is that you have to be a mother figure or father figure who has to take a person under your wing for a long time.”

In fact, she explains, relationships should last no more than a year, so that both parties remain fresh and mentors can move onto other mentees. (Some remodelers disagree, feeling it takes time to build trust and go beyond scratching the surface of an issue.) Phillips-Jones adds that mentoring should demand as little as two hours of the mentor's time each month, but that the mentee should do some extra work — perhaps read a book, take a class, or interview other people in pursuit of a single goal at a time.