10. Rethink the Work Week
2013 Cheapskate Challenge winner Dennis Gehman saves between $30,000 and $40,000 a year by throwing the traditional 9-to-5 workday out the window. When the economy and housing market took a turn for the worse, Gehman, president of Gehman Design Remodeling, Harleysville, Pa., saw the pace of work slowing and the price of gas rising. To take care of both issues, he went from a traditional workweek to a four-day week for his production crews. "We asked our production staff to work four 10-hour days, Monday through Thursday, saving time on setup and cleanup, and saving 20% on travel expenses," Gehman says. The change wasn't huge for staff who were used to working nine-hour days already, so Gehman said crews were all for it. Now, crews work 7 a.m. to 5 p.m. four days a week. "Our clients like that we still work 40 hours a week, but they have one less day per week of noise and extra people in their house," Gehman says.
The company made the change all at once, rather than a gradual transition to a four-day workweek, but Gehman notes that he did make special consideration for breaks and lunches to ensure the alternative schedule didn't encroach on employment laws. When jobs need extra attention on Fridays or weekends, crews can volunteer for overtime. Gehman and his office staffers still work a traditional five-day workweek so clients can call in during regular business hours to meet the team or have questions answered. He jokes that he's looking for a way to get himself on a four-day schedule as well.
As winner of our Cheapskate Challenge, Dennis and his team won a Dewalt 20V Lithium-Ion Max Jigsaw Kit. Congratulations, Gehman Remodeling!
9. Take Care of Your Trucks
If your trucks can't run, neither can your business, so Anthony Slabaugh, owner of Anthony Slabaugh Remodeling & Design in Stow, Ohio takes good care of his company vehicles on a schedule that doesn't break the budget. "A big contributor to overhead can be vehicle payments," Slabaugh says. "We decided that it is much more cost efficient to maintain vehicles properly and have the bodies repaired and repainted as needed." If cash flow is tight, Slabaugh says vehicle repairs and repainting can be deferred until the company is in a better position to pay. However, he points out, vehicle payments must be made to the bank whether you have the money for it or not.
"Plus you're losing so much money in interest," by buying a new trucks, he adds, noting that his company's trucks are all 2004 or older. "Buying a new vehicle for your company is just plain unwise. Buy used and train your team to upkeep the vehicles properly." In addition to a maintenance and repair schedule, Slabaugh says his company uses labeling and wraps to hide minor defects and improve the trucks' visibility. "One wrap can be the same or less as a payment on a new truck, and lasts 3 to 5 years. It's wonderful marketing too!"
8. Make Your Money Work For You
When every penny counts, it's important to look for ways to stretch every dollar. Adam Kilgore, owner of AK Renovations stacks his grocery store perks by purchasing gift cards for places where his company will shop anyway, such as home improvement and office supply stores. "I buy $3,000 worth of gift cards from Giant Eagle grocery store," Kilgore says. "Giant Eagle gives you 20 cents off per gallon of gas for every $50 you spend on gift cards, up to 30 gallons each fill up." So, $3,000 in gift cards earns a total of $12 per gallon, which gets him about 90 gallons of free gas for his company trucks each week. Kilgore notes that the discount is good on up to 30 gallons per fill-up, so unless your truck holds that much, bring a couple of extra gas cans to take full advantage. "I use a Capital One Venture card to make the purchase," he adds, "so I get the credit card rewards as well."
7. Bug Off!
Dogsitter, mail carrier, garbage can collector - a number of odd jobs crop up for remodelers that spend a lot of time at their clients' homes. At Knot Just Decks in Fort Wayne, Ind., office manager Jill Iannetti says the company's exterior projects crews often become exterminators, especially when they're working on gutters. "Mos tof our employees work outside, and when our gutter installers are up on ladders, they often encounter wasps nests," she explains. "In the past, we have spent a lot on wasp sprays, but we found that a much less expensive solution is to put Dawn dish soap in a spray bottle with water." Iannetti says the soap solution creates a film that coats and suffocates the wasps. Gutter crews save the day, and a home remedy saves about $200 a year.
6. Do the Legwork
It's important to look for the best price on materials, and Sam Dogan, owner of Alara Construction in Tuckerton, N.J., makes stores work for his business. "I usually pre-purchase products to complete a projecs," Dogan says. He puts together a list of at least $4,000 worth of materials and heads to a warehouse store to the contractor bidding room for a price, which he takes to a competitive store to see about getting a discount.
"The total savings is around 25% to 30% - I once paid $4,200 on $6,900 worth of regular-price materials. That's 39% savings and annually you could end up saving tens of thousands of dollars," Dogan says. "So far I've saved $48,000 using this method. If you plan early, have a list available, and a few days to run between a couple of stores, you will save a bundle."
In 2008, Phil Isaacs went line-by-line through his budget and cut $15,000 of unnecessary expenses. Today, the president of California Energy Consultant Service, in Rancho Cordova, keeps a spreadsheet of money-saving ideas and implements new measures regularly.
"Controlling costs isn't a silver bullet," Isaacs says, "it's 1,000 BBs."
Here are some of his recent changes:
- Upgrading to dual monitors to boost productivity.
- Investing in a scanner to help the company go paperless.
- Eliminating a storage unit that had housed files now scanned into digital format.
- Canceling the Yellow Pages and other marketing efforts that aren't cost-effective.
- Talking annually with vendors about pricing to prevent "cost creep."
- Reexamining phone service using multi-line services like Ring Central.
5. Easy Changes
Getting a jump-start on saving money sometimes requires starting with the simplest changes. At The Cleary Company in Columbus, Ohio, project coordinator April Howe says even small changes can save a few dollars. Take printing documents, for example. "Everyone in the office reset their computer printing defaults to black & white from color and also from one-sided printing to two-sided printing," Howe says. "Now we only print in color when necessary, and we use both sides of the paper!" The company also looked overhead to make a quick change by outfitting all their light fixtures with energy-saving bulbs. Together, these changes save the company over $100 each year. Every little bit helps!
4. Share Your Safety MeasuresDavid Padgett, general manager of Padgett Building & Remodeling in Belleville, Ill., says getting in touch with his insurance company has helped his company cut costs. Implementing a monthly safety meeting with documentation he sends to the insurance company has reduced Padgett's workers' compensation rates by $10,000 per year. "Most people already have a safety meeting in some shape or form," he says, "but does the insurance provider know about it?" Padgett has staff members sign in before meetings start and sends the sign-in sheet to verify the meeting was held and who attended. He adds that safety-green and safety-orange uniform shirts for crews also shaved money off their rates.
3. Give the Phone Company a Ring
Chicago-area remodeler Jeff Kida of DDS Design Services is maximizing savings on one line item of his budget - the phone bill. "I negotiated to have internet access included in the office rent," Kida explained in his 2013 Cheapskate Challenge entry. "Then I installed a VOIP (voic-over IP) phone in my office, which T-Mobile offers me with unlimited calling for just $10.00 per month."
By getting his phone service over the internet, Kida says he's saving plenty of money. On top of it, he pays just $10 per month for a Myfax fax number. Altogether, "our office communications cost us a total of $ 20.00 per month," Kida says. That's a $2,400 annual savings!
2. Buy Used, Buy Quality
"As soon as I could pay for them in full without credit, I purchased as many quality tools as I could," says Darin Sumpter, principal, Sumpter Restorations, Dunstable, Mass. "Better tools equals less purchasing to replace the cheaper tools you thought you were saving your money on. Buying gently used products such as trailers, and getting the most out of your existing trucks and equipment, saves money in the long run." Sumpter figures his savings total $25,000 per year.
1. Stock the Supply Closet
Some people say that you have to spend money to make money, but Mark Mackmiller, owner of Mackmiller Design + Build, in Eden Prairie, Minn., has found a way to stock up on business necessities without spending more than a few pennies. "Over the past few years, OfficeMax, and to a lesser degree Office Depot and Staples, have offered a variety of supplies for a 100% rebate," Mackmiller says. "Everything from a fireproof safe to copy paper, to nice pens are offered for free. One item they had was bankers boxes, which we offered to our clients for packing up their kitchens prior to a remodel. They loved it!"
Mackmiller says that the only catch to the 100% savings is that the rebate money usually has to be spent in the same store. "Most of the time we churn the same dollars on more rebate items," he says. "Sometime we'd use the savings on other things we needed like printing and technology."
In some cases, Mackmiller Design + Build pays the savings forward. If staff members come across free-with-rebate items that the company doesn't need, they buy them anyway and donate the items to three inner-city schools in their area. "It's a win for everyone," Mackmiller says. "I haven't paid retail for office supplies in years. We save about $1,500 per year, plus we get a lot of goodwill from our clients and the schools we help."