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New Client Feature: Brott Development Group

Brott Development Group, Benjamin Brott, constructionWe’ve added Brott Development Group to our new client roster this fall! Brott Development is a project management firm that values innovative design. They specialize in residential and commercial construction projects. Owner Ben Brott talked to us about his vision, the construction industry, and what he likes about being a business owner.

When did you open your business?

January 2009

What do you enjoy most about being a business owner?

I like working on the business — creating and refining operating processes. They make our service better, more accurate, and more engaging, and our clients happier. I also enjoy connecting and collaborating with talented professionals in my industry.

What motivated you to start your own business?

Anyone who has purchased an Apple product in the last decade would agree Apple’s packaging alone is nothing short of elegant. It conveys a thoughtfulness most companies don’t possess. I remember the absolute joy of opening my first Apple device. Before I could even see or touch the product inside, I could tell it was masterfully crafted, just by the box alone. It was a tactile experience that set the tone for how I perceived the product.

My motivation to start my own business was to mirror the experience I have written about above. I want to continually hone the design & build process to better serve clients, and to create and maintain long-lasting relationships with all project stakeholders

What’s your vision for the business?

To put it simply, I want this business to be the Apple, Tesla, or the Dyson of the construction industry — to be known for constantly pushing the innovation envelope. Working to achieve well beyond the status quo through innovation and improving services to ensure clients and stakeholders are satisfied.

What do you like about the construction industry?

Whether it’s a commercial space where we assist business owners build their dream or a home where we help people live the dream, I love to enhance clients’ lives in a significant way.

What advice do you have for prospective business owners?

  1. Work under a mentor a few years before you go out on your own.
  2. Make a business plan. This may be daunting so start with your business goals. Break your list down into three-year objectives, one-year objectives, and three-month objectives.
  3. Spend 20 per cent of your week working on your business even if you’re really busy.
  4. Unless you can guarantee cash flow, do it while you have a day job and build it slowly. When you have a solid base of experience and cash flow, go for it!
  5. Make a list of people to meet — this is as important as a To-Do List.
  6. Relationships are like muscles — the more you work them, the stronger they become.
  7. Find a role model and mentor for work and life.
  8. Be transparent. Be valuable.

How do you achieve a work/life balance?

I play hockey three times a week and often go for a at least one hike per week. Dinner and breakfast with friends and family is almost a daily occurrence.

Who could benefit from your services?

We facilitate the development process from feasibility to design to construction, and finally to finishing strong. We believe in a partnership approach to projects — one that is 100 per cent transparent. We work closely with clients and our stakeholders to make sure their expectations are met every step of the way, and that they enjoy the process from start to finish, and beyond.

Connect with Brott Development Group on Instagram or Pinterest.

 

 

 

3 ways to profit from your construction business

giphyRunning a construction business can be a daunting task with its own unique set of complexities, as many business owners struggle to make a profit once they’ve taken into account their fixed and variable costs.

Below are three ways to help raise that bottom line!

Fixed vs. Variable costs

Fixed costs are those that need to be paid, no matter if you’re getting jobs or not. These include payments such as auto, telephone, rent, and insurance. Make sure you’re fully aware of what your fixed costs are, as this will help when deciding if you should take a job or not (more on this below).

Variable costs, on the other hand, are directly related to income. A big variable is your Cost of Goods Sold (COGS). COGS are the direct costs associated with the production of goods sold including materials used and labour, but not distribution and sales cost.

In an ideal world, COGS should only be costing you 50% of your total income. You can work towards achieving this through marking up the cost of materials by about 10-15% in order to cover both their variable and fixed costs over the long-term.

Subcontractors vs. Payroll

Many construction business owners are reluctant to put workers on payroll and opt for subcontractors instead. Although it varies from company to company, it’s worth considering payroll. The price of subcontractors can add up, as many business owners end up absorbing the costs of WCB (if their subcontractors don’t have a number). Subcontractors have to pay their own taxes so tend to charge the busines owner a higher hourly rate.

However, putting employees on payroll also comes with its own set of taxes and additional charges (you’ll need to hire an accountant to take care of it).

Look at the bigger picture

Although it’s a hard decision to make, sometimes it’s better to turn down a job if it’s not worth it — the income barely covers the variable costs or you’re breaking even. In these situations, it’s wiser to use your energies towards finding a more profitable job.

If you look at your income and expenses on a month to month basis, rather than a job to job basis, it’s easier to see the bigger picture and make these decisions. It’s helpful to look beyond whether the money you’re making on a job covers the expenses for that particular job. Although you’re making a profit in that case, it doesn’t necessarily mean it’ll be enough of a profit to cover your fixed costs as well.

Check out a great example of a construction company’s P&L statement here. It should be noted that this particular business has three partners.

 

 

 

 

 

Refer a construction client, get a gift card

construction_blog‘Tis the season for construction! That’s right, October is construction and trades month at Homeroom, which means we’re turning our focus on YOU, owner of a construction business. The time is now to get those books organized.

Over the next few weeks, this blog will be filled with helpful tips pertaining to your unique and complicated industry. We’ll discuss the basics such as Cost of Goods Sold, inventory, and how to price your services to ensure you’re covering your bases. We’ll also break down the difference between an employee and contractor, and how to deal with payroll.

But wait, you’re not in the construction business, but know people who are, you say? We want to hear from you too! If you refer a prospective client in the construction or trades industry to us and they book an intake call in October, you get a $10 gift certificate to your favourite coffee spot. All they need to do is say who referred them during their intake call and we’ll get in touch with you.

So stop delaying and start getting organized!