Recently many remodeling company owners have been looking into home performance as a way to bolster their ailing bottom line. They are finding that it’s possible to prosper by finding the right mix of audit, retrofit, and remodeling projects.
Since working on an Energy Star home and then getting certified by the Building Performance Institute (BPI) a few years ago, Ron Samuelson, owner of Samuelson Contracting, in Pleasant Valley, N.Y., has incorporated building science and energy efficiency into his construction practices. Every remodeling job includes an energy audit. But since remodeling jobs have been sparse, Samuelson started a separate company, Home Energy Consultants. Samuelson Contracting is now a division of HEC. “The primary business model,” Samuelson says, “is to deal with energy improvements.”
Clients either choose to have Samuelson do a retrofit project after the audit, or they pay for the audit and move on. HEC does 15 to 20 audits a month; about 15% become remodeling jobs. He invested about $3,500 to have his company accredited and has spent nearly $4,000 for equipment. Although just one person on staff needs to be certified, Samuelson had four staff certified at roughly $2,000 per person. “I’ve more than recouped my investment,” he says. “I’m doing consistent, steady work.”
Samuelson is both optimist and realist. “People still would rather buy a flat-screen TV than lower their energy bills,” he says. “We’ll all struggle in this business until the conventional energy supply becomes more costly.”
When the phone had all but stopped ringing for new builds and remodels at Novella Development, owner Joe Novella took the opportunity to partner with Chris Puleo, a New York State home inspector, to co-found Green Star Energy Solutions, in Sleepy Hollow, N.Y.
To find clients, Puleo began a word-of-mouth campaign among friends and family. He also went to town building departments seeking pulled building permits for remodels, additions, or new construction with budgets above $100,000. Then he drove around town cold-calling the companies working on those projects. “I had to get to the house ... just after framing and before rough-in,” Puleo says. Many jobs Puleo got often lead to more jobs.
While their retrofit client base was growing, a BPI-accredited organization offered to work with GSES. Puleo learned about the Home Performance With Energy Star program and about a New York state fund that GSES could tap into. This would provide a new way to find clients, since BPI approval meant clients would have access to rebates. The same BPI entity connected GSES with a newly BPI-accredited remodeler, PeterK Home Improvement, in Ardsley, N.Y.
Now the two companies are allied. GSES does home performance work; PeterK remodels. In 2009, GSES’ volume was $1.8 million. It has 37 full-time employees, 10 of them BPI-certified. By mid-June GSES had closed out 56 jobs and is turning a 60% gross profit on retrofits. “You can’t make a business out of energy audits on their own,” Puleo says. “The fact that we actually do the work is how we make money.”
—Stacey Freed, senior editor, REMODELING.