We just received our 4th consecutive “Best of Houzz 2017” award.
I can’t say enough how much I appreciate my incredible line up of employees and subs for their impeccable quality workmanship and customer satisfaction.
I never finish a job without praise from my clients about how great my crew is. And that’s what it’s all about.
It’s a very difficult business to be in with the economic roller coaster and all of it’s unpredictability.
But Keeping the customers happy is what keeps us in the game.
As mentioned in my previous post, half of all contractors close their doors before they reach 5 years in business.
Well, here we are at year 33, stronger and better than ever.
Thank You so much to all of our loyal customers who have kept us busy with repeat requests for our services as well as referrals to friends and co workers.
You guys Rock!
Check out our Company profile on houzz.com to see some of our work and reviews from past clients. Hiline Builders on Houzz
One of the biggest challenges I find as a Construction Professional is having to compete with people who don’t know the ins and outs of running a construction business. And, in effect, they lower the standards of the Industry.
The Bottom Line-
1. Proper Markup
With little or no knowledge of what it takes to run a construction business, many new Contractors are unfamiliar with how to determine the proper markup for profit and overhead. And that is one of the reasons why construction businesses have one of the highest failure rates in small business startups.
After working in the trades for 25-30$ an hour, many new entrepreneurs think they have it made because now that they are licensed Contractors they can add a 10% markup to their estimates. And soon they’ll be driving Porsche pickups.
The fact is your overhead alone, (not including profit), is likely to require a 20-30% markup. Factoring in all of the new expenses it takes to start and stay in business. There’s advertising/marketing, sales, fees for licensing and having the proper certifications for the work performed. You have several different insurance requirements- bonds, liability, worker’s comp. Not to mention payroll burden, tooling up, including buying, renting, repairing/replacing tools needed, (which is an ongoing expense), vehicle maintenance, bookkeeping, accounting, office staff, and the list goes on.
Most people don’t realize that you need to have individual Business licenses in ALL of the municipalities where you perform your services. I counted 16 different Building Depts. that I frequently deal with. And licenses go anywhere from $50-$150 each per year.
Overhead is a fixed expense and cutting corners to lower overhead can only go so far. Remember, overhead is the price you pay to stay in business. And keeping the business healthy and profitable is the key to Staying in the Game.
Not having experience with estimating, many new contractors think they need to sharpen their pencils and figure everything at the bare minimum in order to get jobs. The fact is, when you’re trying to estimate labor and material expenses for each phase of the project, there are a multitude of variables, unexpected’s, and incidentals that can drive your costs to double or triple the “best case scenario” mindset.
If we don’t factor in some compensation for the likelihood of mistakes that need to be fixed, unforeseen things that require extra labor or materials, etc., we can easily lose money on a job. Thereby having to rely on the next job, or 2, to recover our losses. Let’s face it, we’re only human and inevitably mistakes will be made and they can be very costly.
Having been in this business for 34 years I have seen many ups and downs in the economy. And when the economy dips, inevitably paranoia sets in with all of the inexperienced Contractors.
I start hearing “If we don’t lower our prices we won’t be able to get any work.”
Not realizing that if they do lower their prices they may very well be looking for alternative careers soon.
This attitude causes a negative image for our industry. Prices get lowered below what is needed to do quality work and keep customers happy. Some will even resort to doing jobs unpermitted when permits are required.
When prices go down, those of us who know better are forced to compete with numbers that are below where they need to be. And let’s face it, too many of our potential prospects consider the bottom line the driving factor on who they will select to do the work.
3. Sales Expense
The larger remodeling firms can have a sales staff with as many as 8-10 sales people.
And you can bet these people are paid well because they are the driving force behind jobs awarded, i.e, Gross sales.
So sales alone is usually the biggest line item markup for a Construction Company. Many small contractors consider their sales time as “just a part of doing business” and view it as a “freebie” and don’t factor this into their overall profitability.
This is the biggest misconception you can make when trying to have a successful business. The reality is, if you’re awarded 40% of the jobs presented, you’re doing very well by industry standards. So you can imagine the time spent chasing dead ends.
It’s not unusual for me to spend 20- 50 hours a week just in sales alone. I meet with clients, go over the scope of the project, followed by multiple meetings on site with subs.
We’ll go over the scope periodically throughout the bidding process and make adjustments as needed. Review products being used, finishes, timeframes, logistics, etc. Then we assemble the written Work Order which can be 20 pages of detailed scope of the project, contingencies, draw schedules, specific products and finishes. All of this can be very time consuming. And it’s not unusual for some clients to request 2 or 3 revisions of the estimate to get the project on budget.
So think about people, should we be willing to give that much of our time for free?
You need to factor your time spent on sales into your overhead or your business is doomed right out of the gate.
The bottom line is- If you want to stay in business for the long haul, keep your clients happy, and preserve the integrity of the Construction Industry, you need to be very familiar with “The cost of doing business”, how it affects the bottom line, and what it takes to “Stay in the game.”
One of the credits we’ll be pursuing in our prospective LEED Platinum project is “Efficient Hot Water Distribution System”, which can earn up to 5 points in the LEED V4 Credit Rating System.
The objective of this credit is to minimize energy used to heat hot water and distribute it to the fixtures.
One of the ways to accomplish this is to minimize the length of pipe between the source, (Hot Water Heater), and the fixtures. This is done by either locating the hot water heater in a centralized location, and/or designing the layout so that bathrooms are either placed back to back or stacked one over the other.
In our case, we will be using 1/2″ pex piping. So the maximum allowable length from the hot water heater to the furthest fixture, including the total length of piping, is 40 feet.
This particular project lends itself to this credit because the total living are is so small, 584 ft². And we were able to easily locate the Rinnai Tankless Water Heater in a centralized laundry closet. We chose the Rinnai gas water heater model RUCS65iN as this was perfect for this application.
Larger homes can be more of a challenge. But one way to accomplish this credit in a larger footprint is to have multiple water heaters near each fixture. Small electric water heaters can be concealed in cabinets below bathroom or kitchen sinks. This allows you to bring cold water lines to the heater and heat directly at the fixture as water is circulated through the line.
One of the other criteria of this credit is that we insulate all hot water piping. This includes taping at all joints and Ts, and using min. R4 pipe insulation.
Next week we hope to be at the rough plumbing stage and we will be able to provide illustrations of the information provided here. feel free to post any question regarding Efficient Hot Water Distribution Systems below and keep checking back for updates on other LEED credits being pursued and the methods for achieving them.
My Christmas Present just arrived in the mailbox today.
The latest addition of Modern Builder+Design Magazine featuring Hiline Builders Inc.
The article, entitled- “Sustainability in Sacramento” represents our commitment to raising awareness of the benefits of Green Building Principals and Practices.
The payoff comes not only in energy efficiency savings but the health benefits are often overlooked and underappreciated as well. Click Here to read the full article.
Stay tuned as we document our current prospective LEED platinum project which is currently under way.
The photos of one of our completed projects in this article were graciously provided by Dave Adams Photography.
I sat in on a seminar last week at the Pacific Coast Builders Convention that was directed towards the upcoming changes in store for Ca. Title 24 2016.
According to Energy Code Ace, California’s current agenda includes all new Homes being built to be zero net energy by the year 2020. A very aggressive expectation by any stretch.
One of the main objectives of the new upgrades was to make attic spaces cooler in order to extend the life of our HVAC systems. Some attics can reach 140 degrees or more in the summer months and for our systems to perform in this heat they must work much harder. Not to mention the hot air needs to be pushed through the ducts before the new cold air can be introduced.
So there are 4 alternate options being offered for roof systems.
• Apply a 1” air space between roof deck and roofing for air to move freely and keep the attic cooler. There are new systems being developed to achieve this.
• Insulate not only the ceiling but the rafters above to help keep the attic cooler.
• Don’t insulate the ceiling but ONLY the rafters above. Thereby making the attic into conditioned space. This would require the attic to have no ventilation to not allow the cool, conditioned air to escape.
• Or place all HVAC equipment and ducting in a conditioned space as in below the ceiling. This would require soffits to be built under the ceiling level to accommodate duct runs in the conditioned area.
All of these options have mandatory provisions for wrapping all ducts with min. R4 insulation, a Hers test will now be mandatory for duct leakage testing, and all roofs will be required to be Sheathed with radiant barrier roof sheathing.
Another new mandatory measure is that ALL new residential construction will be required to have continuous 1” rigid foam insulation around the entire exterior. So you might want to do your homework now for system integration of housewrap, window flashing, foam insulation, and fastening of wood siding to the foam.
The new codes are set to take effect in January of 2017.
Ring in the new year with new trends and technologies in kitchen and bath designs.
2016 seems to be the year for eclectic choices. For those who are bold enough to mix design finishes without fear of ending up with an aesthetic disaster.
I think we’ll be seeing a lot more offered in the way of aging in place features as our Baby Boomers are coming of age.
Bold wood finishes and tile back splashes are in. Alternate dining tables are being incorporated into the kitchen island or peninsula.
And more and more attention is being directed towards green alternatives. Recycled or rapidly renewable materials are in. Like recycled glass countertops, rapidly renewable wood species for floors and cabinetry.
Have a look at this video by the Williams Studio for some creative inspiration-
I’m getting excited about going to Vegas for the IBS, (International Builders Show), this month.
Going to trade shows is by far the best way to maintain that cutting edge and keep up on all of the new products and technologies being offered.
The IBS is now teaming up with the KBIS, (Kitchen and Bath show), to offer 2 great presentations in one place.
I’m more excited than ever this year because I will be conducting interviews with some of the product vendors who’s products I’ll be using on my upcoming LEED Certified Residential project which is now under way.
I’m filming an awareness documentary featuring the process of building a net zero energy, LEED platinum home.
I’m really looking forward to creating a comprehensive presentation that will take you step by step through the process and explain the benefits along the way.
Stay tuned and let me know if you have any sustainable products or features that you would like to see illustrated.
Till next time.
Hiline Builders Inc. of Fair Oaks Ca.
Awarded Best Of Houzz 2016
Over 35 Million Monthly Unique Users Nominated Best Home Building,
Remodeling and Design Professionals in North America and Around the World
Sacramento Ca. January 12, 2016 – Hiline Builders Inc. of Fair Oaks, Ca. has won “Best Of Customer Service” on Houzz®, the leading platform for home remodeling and design. The 32 Year Old Design Building Firm was chosen by the more than 35 million monthly unique users that comprise the Houzz community from among more than one million active home building, remodeling and design industry professionals.
The “Best Of Houzz” is awarded annually in three categories: Design, Customer Service and Photography. Design award winners’ work was the most popular among the more than 35 million monthly users on Houzz. Customer Service honors are based on several factors, including the number and quality of client reviews a professional received in 2015. Architecture and interior design photographers whose images were most popular are recognized with the Photography award. A “Best Of Houzz 2016” badge will appear on winners’ profiles, as a sign of their commitment to excellence. These badges help homeowners identify popular and top-rated home professionals in every metro area on Houzz.
“We strive to be the Company that everyone else tries to emulate”
~ Phil Vanderloo, President, Hiline Builders Inc.
“Anyone building, remodeling or decorating looks to Houzz for the most talented and service-oriented professionals” said Liza Hausman, vice president of Industry Marketing for Houzz. “We’re so pleased to recognize Hiline Builders Inc., voted one of our “Best Of Houzz” professionals by our enormous community of homeowners and design enthusiasts actively remodeling and decorating their homes.”
About Hiline Builders Inc.
Phil Vanderloo, President of Hiline Builders Inc. has been designing and building custom homes and residential remodels for over 3 decades. His relentless commitment to excellence and superior customer service has kept Hiline Builders Inc. at the forefront of Northern Ca. Design Build Contractors. Phil Vanderloo is a LEED AP BD&C, and LEED AP Homes, and a Certified Green Building Professional.
Houzz is the leading platform for home remodeling and design, providing people with everything they need to improve their homes from start to finish – online or from a mobile device. From decorating a small room to building a custom home and everything in between, Houzz connects millions of homeowners, home design enthusiasts and home improvement professionals across the country and around the world. With the largest residential design database in the world and a vibrant community empowered by technology, Houzz is the easiest way for people to find inspiration, get advice, buy products and hire the professionals they need to help turn their ideas into reality. Headquartered in Palo Alto, CA, Houzz also has international offices in London, Berlin, Sydney, Moscow and Tokyo. Houzz and the Houzz logo are registered trademarks of Houzz Inc. worldwide. For more information, visit houzz.com.
Hiline Builders Inc. of Fair Oaks Ca. Receives
Best Of Houzz 2015 Award
Over 25 Million Monthly Unique Users Rated Top-Rated Home Building,
Remodeling and Design Professionals in the United States and Around the World.
Sacramento Ca, USA, January 29, 2015 – Hiline Builders Inc. of Fair Oaks Ca. has been awarded “Best Of Houzz” for Customer Satisfaction by Houzz, the leading platform for home remodeling and design. Sacramento’s leading Remodeling and Design-Build Firm was chosen by the more than 25 million monthly unique users that comprise the Houzz community from among more than 500,000 active home building, remodeling and design industry professionals.
The Best Of Houzz award is given in two categories: Design and Customer Satisfaction. Design award winners’ work was the most popular among the more than 25 million monthly users on Houzz, known as “Houzzers.” Customer Satisfaction honors are determined by a variety of factors, including the number and quality of client reviews a professional received in 2014. Winners will receive a “Best Of Houzz 2015” badge on their profiles, helping Houzz users around the world who discover and love a professional’s work to learn even more about that business’ popularity and satisfaction rating among their peers in the Houzz community.
“We strive to be the Builder that sets the Bar for Customer Satisfaction and Quality Design-Build Projects.”
“Houzz provides homeowners with a 360 degree view of home building, remodeling and design industry professionals, empowering them to engage the right people and products for their project,” said Liza Hausman, vice president of industry marketing for Houzz. “We’re delighted to recognize Hiline Builders Inc. among our “Best Of” professionals as judged by our community of homeowners and design enthusiasts who are actively remodeling and decorating their homes.”
Hiline Builders Inc.
is Sacramento’s cutting edge Design-Build and Remodeling Professional.
Houzz is the leading platform for home remodeling and design, providing people with everything they need to improve their homes from start to finish – online or from a mobile device. From decorating a room to building a custom home, Houzz connects millions of homeowners, home design enthusiasts and home improvement professionals across the country and around the world. With the largest residential design database in the world and a vibrant community powered by social tools, Houzz is the easiest way for people to find inspiration, get advice, buy products and hire the professionals they need to help turn their ideas into reality. Headquartered in Palo Alto, CA, Houzz also has international offices in London, Berlin and Sydney. For more information, visit www.houzz.com