What compels carpenters to go into business for themselves? A wide range of motivations, from the fulfillment of a lifelong goal, to the seemingly obvious route to better money and greater control of their time and craftsmanship.
What keeps most of them from achieving anything near their vision of success? Often, themselves. The same qualities that help residential remodeling carpenters excel at their craft — a love for physical work, people-oriented personalities, independent natures — often get in the way of their business goals. Anecdotally, carpenter-CEOs are less likely than their non-craftsperson peers to charge enough money, to focus sufficiently on their business systems, or to reach out for the help they'll inevitably need.
Dave Brady, for one, nearly underbid his way out of business before it even got off the ground. “I would look at a job and say, ‘We can do this for $1,000,'” says Brady, who started Oak Design & Construction, Oak Park, Ill., in 1979. “Twelve hundred dollars later, we would realize we were losing money.” With focus and what he calls “self-discovery,” including the realization that he could hire better carpenters than himself, he strengthened his financials and today runs a company whose revenues are a stable $3 million to $3.5 million each year.
Many carpenters sabotage their CEO aspirations by avoiding paperwork. “You're used to driving nails and keeping numbers in your head,” says Jud Motsenbocker, who launched Jud Construction, Muncie, Ind., in 1968 and sold the predictably $2 million-a-year company to his son in 2006. “You have to put your systems into place and make them work,” he says.
One of Jason Levinson's moments of truth came several years after starting Maryland Heritage Custom Builders in Frederick, Md., in 1994. Asked to build a house from the ground up, the then-framing contractor suggested the first fee arrangement that came to mind: cost plus 10%. “I wasn't in it for money, and I was struggling with the mindset that business people are crooks,” he says. His honest-carpenter mentality killed any profits Levinson might have made on the job, but he shrugs it off as a learning experience. “Hey, if I blessed them, I blessed them.”
In 2006, Maryland Heritage Custom Builders had revenues of $1,050,000, and Levinson hopes to grow it above $2 million. The company has changed shape in its 12-year existence; at one point, as a framing contractor, Levinson had 14 field employees; he later took a two-year hiatus as a youth minister. Today he has five employees and a family to support, and a more focused determination to become a true remodeling CEO.
Here are some of the potholes he'll need to avoid en route.
FINANCIAL BLIND SPOTS Poorly marked and largely unpoliced, the road from carpenter to CEO is littered with the wreckage of talented people. “We hear that the great majority of remodeling companies fail within the first few years,” says Therese Crahan of the National Association of Home Builders' Remodelors Council. One reason is the ease with which anybody can get behind the wheel. Another is the simple fact that carpenters are hands-on and action-oriented by nature — tendencies that wouldn't be a problem if paperwork weren't so tedious by comparison.
“Were they lovers of paperwork, they would not be carpenters,” muses Linda Case, a REMODELING columnist and founder of Remodeler's Advantage. Many carpenters bypassed college, missing out on finance and marketing classes. There are exceptions, of course, but even skilled lead carpenters can be surprised by the real costs of doing business. “They may know how much their jobs sold for, and it just looks huge,” Case says.
Levinson, for one, went to college but was more interested in lacrosse than academics. He also performed in rodeos, rode motorcycles, and did a five-year turn in the Marine Corps, where as a first lieutenant he enjoyed doing “hasty construction and blowing things up” in such war-torn regions as the Middle East and Somalia. “I'm always looking for adventure,” he says. “The bigger the risk, the bigger the reward.”