PRESS RELEASE

FOR IMMEDIATE RELEASE: 6/23/08

Polar bears were just granted “endangered species” classification, and while it’s probably a good thing, the certification does little to help another endangered species: the contractor. “It is not hyperbole to assert that the contractor in the United States, and in the world, in general, is being moved, one step at a time, towards extinction,” so says Lee W, Dodson, owner of thecontractorsside.com, a resource site for the worldwide construction industry.

The Los Angeles Times has noted recently that “the supply of good contractors is twenty years behind the demand,” and yet those who enter the profession have become the most maligned of businesspeople.

In its efforts to gain recognition of the contributions of the small contractor, thecontractorsside.com has worked to reveal the true nature of the business climate for one of the prime ingredients to the economy.

To further that effort, thecontractorsside.com has launched:

DIRTY ROTTEN CLIENT EVENT

OVERVIEW

http://www.thecontractorsside.com in association with BUILDERnews Magazine and http://www.filthyrichcontractor.com will give a business consultation to one contractor or contracting business who writes the most interesting story of their encounter with a bad client, supplier, official, or another contractor.

The business consultation will consist of a two hour evaluation of the contractor’s business and set up of a viable business model, then it will followed up by two one-hour follow up consultations to make sure the model works.

The consultation will be conducted by Ron Roberts of filthyrichcontractor.com, a well-known and respected business model consultant dedicated to the particular style of the construction business.

The discounted value of the program, available to members of thecontractorsside.com, is $1000.00, and Ron has testimonials that say it’s worth $100,000.00 if the construction business is in trouble. By registering on thecontractorsside.com and posting the experience the poster gets it free.

The story does not have to be well written, but it does have to lay out the facts of the business relationship. With well over a hundred years aggregate experience in construction, the event will be judged by people who know the business, a panel of nine regular people from all over the country connected to the business:

http://www.buildernewsmag.com

http://www.hometalkusa.com

http://www.contractors-united.com

http://www.4allcontractors.com

http://www.filthyrichcontractor.com

http://www.aehcc.com

http://www.ondemancreations.com

http://www.thecontractorsside.com

http://www.helloworld.com/srstgary

In addition to the opportunity to get the best advice keyed to your particular business, thecontractorsside.com has arranged with BUILDERnews magazine to give a free one year online subscription to the publication to each registered user of thecontractorsside.com up to ten thousand new users or repeat posters.

The magazine is a terrific source for business info, well produced, smart, and professional. It could end up to be the best source for industry news and comment this year. If bought at the news stand, the year price would be $48.80, by registering and entering, the DIRTY ROTTEN CLIENT gets it delivered monthly right to the poster’s computer.

HERE’S HOW

Go onto http://www.thecontractorsside.com.

Register. Participation is limited to new registers or repeat posters

Fill out the form.

The poster tells the story. Keeps it clean and factual. Tells what happened. Tells what the problem did to his or her business, what it cost both financially and personally.

Anonymous postings may be requested.

Every post is read and evaluated according to a point system.

Early entry is advised as the competition closes July 8^th.

The winner will be announced on Michael King’s Home Talk USA Saturday July 20th at 9:30 am CDT. Only one person will know the name of the voted winner, and she will reveal it to Michael King on the air.

Other prizes may be awarded to runners up the same day and time.

Digital BUILDERnews subscriptions will be awarded on a first come, first served basis up to 10,000, and will be automatically subscribed to the email address on the registration page.

If you drive on it, work in it, or live in it, a contractor built it.

“This project is designed to bring the downs of the business out of the shadows,” said

Dodson. “We’re particularly grateful that publications like BUILDERnews see the problem and are providing tangible support. As we are for the Michael King of Home Talk USA, and the other judges of the event.”

Will anybody listen?

“We believe so, but this one project will not be our last stand. We have a couple of other surprises coming within the month.” Dodson grinned. “We’re waking our members up to the power of the internet. Should be interesting. The market is smart, we want the contractors to get just as smart.”

Hope you find the time to participate.

To your great success!

 Ron

For those of you gluttons for punishment, I will be on the radio tomorrow morning Saturday June 21st. The show is Home Talk USA hosted by Michael King.

Michael has invited Lee Dodson of the ContractorsSide.com and myself to kick off a little contest.

The spot will air sometime between 9:30 and 10:00 AM Central. To find a local station that carries the show click here.

Tune in to find out more. Call in to the show if you have questions.

The headline could, and maybe should, refer to punching out a job but today it refers to installing processes and systems in your business. Just like with construction projects, finishing off the last 5% of the implementation of a new business procedure seems to take 50% of the total time. The last 5% is painful, boring, and annoying…but it must be done!

A recent marking email I sent out to my newsletter reader list brought this point to mind. In the email I promised to share the secret to keeping crews on time and in budget. (Side Note: marketing emails to the list are few are far between.)

A bunch of contractors emailed or called in to learn the secret as they were struggling with their crews. A handful of these contractors had 95% of the solution in place yet they hadn’t completed the last few steps and therefore weren’t receiving the desired results.

It really drove home the point that if you don’t finish something 100% you will not receive the benefits you seek. In the case of construction projects that translates to not getting back your full retention.

So here’s my tip: Dad was right. If something is worth doing, it’s worth doing right.

Don’t let up until you’re done. In some cases, such as with keeping crews on budget and schedule, the follow through requires daily action.

Hope this helps you move forwards.

Take care,

Ron Roberts,
The Contractor’s Business Coach
913-961-1790

Good Morning~

Happy Friday the 13th. It certainly started off on a bad foot around my town. Nasty storms passed through during the night. If we get any more rain, Noah better bring his Ark.

Things have been hectic around here. Chasing leads. Helping clients grow. Networking with people from coast to coast to find valuable information for contractors. Meeting with my new business partner, Guy Gruenberg, to lay out our plans for the membership site.

My day was politely interrupted yesterday when an email arrived from an associate. He sent me something to look at that really needed to be shared. He gave me his blessing.

From time to time, I am motivated to pass along helpful guidance generated by friendly “competitors”. Hopefully, it is further proof that I am committed to serving your best interests with this blog and my newsletter.

Bruce Cotterman sent me the following to look over and quite honestly I thought it was spot on for protecting yourself during these lean times. Should you choose to reach Bruce after reading his advice, please let him know that you found out about him from the FRC blog.

How to Protect Your Financial House During Lean Times

Start now managing for the slow down and start making the painful decisions while you have the staying power. Weather the storm staying true to customers and suppliers and you’ll be positioned to lead and see double digit growth with price premiums when it’s over.

1. Cash flow is King, manage weekly if not more often from this point forward.

Talk now with your accountant, set up weekly cash flow reports

Start building up your cash on hand

2. Time to start reducing overhead costs

Reduce inventory, hold off on purchasing and unload what you have, discount if needed

Reduce payroll removing non-performers (hold onto performers)

Better to do it now while they can find alternative work rather than later if the economy tanks or approaching the holidays

Place on hold any acquisitions, maintain existing equipment (there are exceptions)

Say no to any un-necessary purchases or spending

3. Aggressively start collecting on Accounts Receivable NOW!

4. Pay your suppliers. When times get tough, they’ll remember you and help you.

Ask them what they are seeing?

Ask them for business referrals as a dependable contractor

5. Make a personal visit with your bank where you have a rotating account

Let your bank know the actions you are taking.

Ask them what they are seeing?

5. Market and sell as if your survival depended on it.

Promote your staying power and warranties to counter the fly-by-night contractors.

Keep advertising going to keep the pipeline filled, but nothing extravagant .

Hustle

Use the web smarter

Offer competitive rates by promoting discounts rather than lowering prices

6. Talk to your staff and performers. Let them know that you what you are doing to weather any slowdown.

DO NOT HIRE. Use 1099 sub contractors and temps for now.

Do not worry about releasing non-performers. The performers will understand and appreciate not having dead-wood around.

7. Use the slow down when it occurs for planning and positioning including some marketing when the economy returns strong.

Bruce Cotterman of The BAS Group in Atlanta, Georgia, provides management consulting and marketing services to small to medium size businesses. www.theBASgroup.com

Our friends over at www.thecontractorsside.com are doing their best to repair the reputation of contractors nationwide. They have started a grass roots campaign to force an LA Times writer to publish a pro-contractor type article. They are making gain with him but could use your help. Please read the following letter to the editor and then email your feelings to Mr. Lopez.

Here is the original correspondence from Heather Aitken:

Please email the following letter to the editor to the Los Angeles Times (robert.lopez@latimes.com) and then send it on to ten other contractors and so on, so we can let the press know how honest contractors feel.

Thecontractorsside.com

Here is Lee Dodson’s letter to the editor:

Dear Mr. Lopez,

I read with interest your story on unlicensed contractors being busted.

This is of interest to legitimate contractors everywhere, however, I do not see and have not seen one article anywhere, in any publication, that gives favorable mention to the contractors who slug it out every day in a tough business.

Contractors already know that unlicensed contractors hurt the business, but reports of this nature tend to tar all contractors with the same broad brush. In this state, contractors operate under the most stringent rules in the country,

Contractors must not only be licensed, they must carry a bond, must carry workers’ compensation insurance or self insure, and are required to go to mandatory arbitration without recourse to appeal in the case of dispute.

Add to these facts that the codes and regulations, price increase in permits, and heavy zoning restrictions, and the cost to the contractor has skyrocketed in the past few years.

The customer does not know the intricacies of the business of contracting, nor does the customer care. He looks at price, and there is where the cheap guys see an opening, i.e. unlicensed contractors.

The licensing process (testing, evaluating, authorizing) is fairly good, but the process needs streamlining. It can take months to move forward. But after the licensing process is successfully completed, the licensing entity becomes the adversary of the contractor, rather than becoming the ally. The Board becomes solely an advocate for the consumer, leaving little doubt that the contractor bears burden of proof of innocence.

Accusations of malfeasance against the contractor weights in favor of the contractee, and the contractor bears the total burden of expense while the other party simply shows up, the State on his side.

The bonding companies, knowing they own the contractors’ business, can charge maximum fees for a “required product,’ and they do. In my investigations into bonding companies, I have found not one contractor who has received the advertised “preferred rate” for bonds. Bonding companies do an absolutely perfect “bait and switch” maneuver that nearly always results in doubling the original cost of bond.

Workers’ Compensation packages soar in expense as another “required cost of business.” Due to the overwhelming number of fraudulent claims, the snail-like pace of adjudication and settlement, the ineptitude of investigators, the onerous medical proving up, the system is burdened at more than quadruple its capacity, thereby increasing costs to the insured which, in turn, is passed on as increased cost to the end user.

Add to these facts the unending number of stories of “bad contractors” who rip off the clientele, and any story, repeat any story, dealing with the construction trades rises to a tacit indictment of all contractors, unlicensed or duly licensed.

One might ask if the licensed contractor has any recourse but to report unlicensed contractors, and the answer is no. Most contractors are loath to become involved with any authorities over any but the most egregious of violations because it does not serve their interests and because most contractors want to stay off officials’ radar. Anonymity is the best protection.

One might further ask if anything has been done to help small contractors. Again, the answer is no. Legislatures and government bodies have done absolutely nothing, passed no laws, written
no new regulations to help those whom “if you drove on it, if you work in it, or if you live in it, a contractor built it.”

Courts have been no better. In Southern California, according to the L.A. Times, seventy-five per cent of all civil actions involve construction related cases. My research indicates that the contractor may as well stay on his or her current job to make the money he or she will need to pay off the judgment because, from Small Claims to Superior Courts, eighty-five per cent of the time the ruling is for the client.

This anti-contractor attitude has evolved from a belief that contractors make a killing on every last project. The reality is that most small contractors work to a less than twenty percent markup that is rarely achievable. Most small contractors do well to reach a ten per cent profitability, if that.

Across the nation, the situation is remarkably the same. Since I launched my website:
http://thecontractorsside.com, I have heard from thousands of contractors the same series of complaints about identical issues, but the one foremost complaint is the use of official bodies and rules to either reduce payment, or to not pay at all.

Why is this complaint so common? The easy answer is that there are a lot of cheaters out there, but it could well be that cheating has become institutionalized as a product of unbalanced regulation on a business which may be the only business in our country that remains unable to be outsourced.

I heard recently from a contractor who boasted he had never been stiffed on a payment in
his twenty-five years of plying his trade. I thanked him for his call and asked if he might
have any advice to contractors who had not been as lucky. He rattled off a few well-known
practices and said if a contractor followed the rules, he would be paid. I thanked the man
and sat down to write my constituents his wisdom.

Yesterday, the same contractor called with the news that while he had played by the rules, done his due diligence, he had just yesterday been stiffed for $8000.00. He was still stunned by the event. Needless to say, he registered on the website ten minutes later.

What can be done to improve the lot of the small business contractor who has next to no power with officialdom or media?

Because the small contractors have no true advocacy aside from small publications and loosely organized trade associations, they have limited access to redress, and few speak on their behalf.
Their sole recourse is to become educated as to their market, and that means sharing information. There are business seminars and coaching institutions which can help in the “business” of the business, but these entities focus on individual practice rather than a group effort towards commercial overview. Again, the contractor is isolated, insulated from information essential to the conduct of informed practice, i.e. good customer, iffy customer, bad customer up to and including suppliers, officials, banking institutions, architects, and engineers.

No one shows any intention of taking the contractors’ side, therefore, the contractor must take his or her own side in the work of improving the business, and this means in the area of policing not only unlicensed contractors, but also in the area of policing every area of
contractor-societal interconnect, including self- and client-education.

If contractors initiate the improvements, the effect can be far-reaching and effective, but they must take action to preserve the small business venue.

If the small contractor opts out, the results for the economy can be disastrous. Prices for construction will soar when the only bidders are large companies who perforce control the market.

It is said that this country runs on small business. It employs more people than major corporations, provides more peripheral and entry level jobs, is more responsive to market pressures, is more highly creative is problem solution, and is truly the backbone of the nation.

The contracting business needs some good news and good press.

http://thecontractorsside.com is the only resource for this kind of information and the only established advocate for the contractor. If you want to know what’s happening in the construction business where it really matters and where to take action, this is the place.

I am cc’ing this message to my constituents so they can sign onto it in agreement and
send it to you so the thousands of diligent, honest contractors can finally get some credit
where it is due.

Respectfully,

Lee w. Dodson