Real estate agents “want to provide their clients with good professionals in the construction industry,” says Ricky Scott, one of two partners in The Kingston Group. “We want to be that.”
Scott and partner Robbie Edwards work with three or four core real estate agents who supply them with referrals—mostly homeowners who have just bought a house and want it remodeled before they move in. That work, plus revenue from their Property Services division—primarily for homeowner association boards—makes up the largest portion of the company’s growing business.
Scott and Edwards started their business in 2008, when the economy was imploding.
“We learned from what we saw,” Scott says, including how not to run a residential remodeling company. “We made money as we made money, and we didn’t try to take out more than the business could handle,” he says.
That approach to cash flow and management has allowed The Kingston Group to grow at a steady rate through the recession. Scott is particularly adamant about not taking on debt, so as not to be paying in interest net profit dollars that can be reinvested.
- While many companies with thinner margins have dropped health care and 401(k) plans, The Kingston Group has recently beefed up its benefits package as the company seeks to add talented personnel.
- The company no longer allows trade contractors to charge time and materials. Instead, it requires that they provide a lump-sum bid, and Kingston seeks out at least two bids on each critical aspect of the project. Edwards says he realizes that he could make more money marking up that portion of the job, but he gets anxious about the relationship with the customer, who’s watching expensive tradesmen take hourly cigarette breaks.
- After letting those trade contractors know about their plans, The Kingston Group recently began providing clients with a schedule of warranty inspections. The project manager re-inspects the job at three months, six months, and 11 months, addressing issues such as caulking trim or smoothing out a cracked grout joint, which gives the company an opportunity to get back in front of the client and ask for referrals.