At a certain point in the life of their business, remodelers seek to create a management team to help shoulder the burden of running and growing the company. To aid them in this search, owners can turn to the expertise of recruiting firms.
“The recruiting industry is well understood in corporate America,” says Brian Roberts, vice president of client service at Construction Recruiters, a firm that works in New England and some areas of Florida and California. He says that builders began using recruiting companies about 10 years ago and remodelers in the last five years. “The fact that more sophisticated remodeling contractors are seeking this kind of help is indicative of the maturity of the industry,” Roberts says.
THE SWEET SPOT Most of Roberts' clients have a sales volume of $1.5 to $5 million. “That is where we have the most impact. You're starting to think in terms of not just production, but management of resources,” he says.
Mary Tibma, operations and marketing director of Tibma Design/Build in Needham, Mass., has worked with Roberts to hire a project manager, production manager, designer, and estimator. “Our company has grown from just me and my husband nine years ago to 15 employees. There is a certain threshold of sophistication where it becomes critical to have key managers,” Tibma says.
Roberts says that a volume of $1.5 million is usually when the owner wants to take off some of the hats he's been wearing. “They need an employee to take that task and go deeper with it,” he says. A recruiting firm can help that owner search for candidates to fill management positions such as field supervision, project management, and executive leadership.
At $8 to $10 million is where owners need the full-time financial support of a chief financial officer. “Financial help is expensive,” Roberts says, “because they add pure overhead.”
Roberts points out that the standard compensation for recruiters is 25% to 30% of a candidate's estimated first year's earnings. “You have to be committed to growth,” he adds. “Using a recruiter is akin to hiring an accountant or lawyer in terms of impact on your business.” This is a significant investment, but as Roberts notes, the cost of a bad hire is high in both the financial and emotional toll it takes on company owners.
COST BENEFITS There are many benefits to using a recruiter that can justify the cost.
Time Factor. “Most owners do not have enough time to devote to a proper search,” Roberts says. “Their ads do not have sizzle or they do not check references.”
Database. Roberts says recruiters have a large database of potential candidates. “Our clients have access to an expanded network. We have a homegrown database of 14,000 construction professionals in New England,” he explains. “We provide clients with options that a client could not provide themselves, but it comes with a premium price tag.”
Experience. During his career, Roberts has hired 1,500 employees. Most owners do not have that breadth of experience. “By the time they are looking to hire, they are in pain,” he says. Tibma and her team tried to fill a project manager position themselves. “They could talk the talk, but could not walk the walk,” she says. When she described that hire to Roberts, she says he pointed out some red flags that they had not seen.
Tibma says it is important that the recruiter understand the company's values and culture so they can find someone who is a good fit. She considers Roberts and his team to be key advisors. “They are a great resource because they know the industry,” Tibma says. “They help us fine-tune our expectations.”