The Right Clients, The Right Subs | Bob Perez - Builder Stories

Episode Transcript
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Eric (00:00):
Welcome to the podcast where we take a deep dive into the stories
behind construction business leaders.
We will share how they got started,how they found success, and the
lessons learned along the way.
I'm your host, Eric Fortenberry.
Welcome to Builder Stories.
Welcome back everybody.

(00:20):
Today I'm here with Bob Perez, whois a partner with Steven Thomas
Construction, located in Austin, Texas.
Really excited to have you onthe on on, on the podcast here.
Bob, welcome to Builder Stories.
Great to be here.
Thanks for having me, Eric.
Appreciate it.
So why don't you, you know, justkind of give us, give us quick little
background for everyone out there.

(00:41):
You know, who are you, how did youget into construction the first place?
What led you to, to startyour construction business?
What do you guys do, things like that.

Bob (00:49):
Yeah,

Eric (00:49):
so,

Bob (00:50):
um, we're Steven Thomas Construction, um, based at Austin, Texas.
We specialize in, um.
Uh, residential, um, additions,remodels, new construction.
And then we do somelight commercial as well.
Um, I started the company, uh,with my partner back in, um, 2019.

(01:14):
Um, and I, I, I don't comefrom a construction background.
I, I spent had an 11year corporate career.
Um, and, uh, it was doing a lot, uh,business development for an energy
consulting firm, and I was able to,you know, live everybody's dream of
just kind of walking out of their,their corporate job and, you know,

(01:37):
wanting to, to work for myself.
So, um, I started off, um, kind ofjust, you know, I didn't, you know,
know, uh, what a rough end was and, um,had no, I, no idea of the, you know.
Anything about the construction business.
But, um, had a, a, a, a partner ofmine who, um, was looking to kind of

(02:00):
grow their construction business andneeded somebody with a little bit
more, um, experience in, in workingin, in a more structured environment.
We'll put it.
So, um, you know, and I, you know,getting into that, into the business.
I just, you know, I think I'm one ofthe crazy people that really enjoyed
my own personal remodel, um, andworking with my general contractor.

(02:23):
And I would think tomyself a lot of times like.
While I was working with them and justmiserable at my corporate job, how
much fun that would be, um, to get towork in that kind of, um, environment.
And I just, I love the, um, Ilove how tangible construction is.
Construction's one of those things thatit's, um, you know, there's a start.

(02:47):
Usually there's a finish.
Um, but, uh, making something real.
And there's just a tremendous amountof job satisfaction in, in doing that.
Um, that, that I get that I, Ijust wasn't getting in, in my,
in the, in the corporate world.
Um, so, you know, it's, it's obviouslynot all sunshine and rainbows.

(03:09):
Everybody knows that.
Um, but I love the challenge of it.
I love, um, you know,problem solver at at heart.
And so this is a business where that'swhat you're doing all day, every day.
Um, and so that's, that's a littlebit of, you know, background about,
about myself and, and the, the companyand you know, how we got started.

(03:31):
So,

Eric (03:31):
yeah.
That's, that's awesome.
So, you know, 2019.
Right around, you know, same, sametime we started Job Tread as well.
You know, I, I can, uh, I can,I, I can attest that, uh, what
wasn't the easiest to start abusiness in the middle of COVID.
No, I'm, I'm, I'm, I'm curioushow that, uh, you know, so, so,
so you and your partner, so, so.
What are you guys like, what,you know, who, who focuses

(03:52):
on what within the business?
Like, you know, are you, you know, youproject manager, any sales, vice versa.
How, how, how did you guys decidewho was gonna, who was gonna do what?
Sure.
So we,

Bob (04:01):
we really leaned into our strengths.
Like I said, I've, I've got a, a corporatebackground, kind of business development.
Um, and my partner comes fromthe, um, the production world.
So he spent a lot of timeat a large national builder.
Um, he is a landscape architect by trade.
Um, worked in the family business for sometime and then, uh, went to production, and

(04:21):
then went into to custom home building.
So his experience and, andknowledge in the actual, you know,
building process is critical.
Um, and so I'm, I, I focusmore on, on the backend task.
I think the, you know, right now as a,as a boutique builder with, you know, um.
With two people.

(04:42):
Um, we, we rely heavily and, andwe don't self perform any work.
So, uh, we are very lucky to havesuch a, a talented, um, trade base
and trade partners that we work with.
Um, but.
I, I, I serve, I think what would betraditionally, in addition to kind
of running the business and businessdevelopment when it comes to the
actual projects themselves, more of aproject coordinator pre-construction.

(05:05):
Um, and then, um, Jared, my, uh,partner handles more of the, um,
you know, project management fieldsupervision once construction starts.
So.
You know, when we're talkingto new clients, that's kind of
the process that we outline.
If me, you know, I'll, I'll be, I'minvolved in the project from start to
finish as is Jared, but there's a lot moreof me in the beginning as we run through

(05:29):
our free construction process, which isa, a very rigid kind of checklist of items
that we need to decide on, on lead times.
Things like that.
And then, um, that kind, you know,leading all of the, the weekly meetings
and then as we transition into the buildphase of that relationship and, and
lead kind of switches over to Jared.
Um, but it's obviously importantthat we're both involved

(05:51):
at every, at every phase.
It's just really who's taking thelead on the action items and, and
driving, um, you know, those decisions.
Um, but that's, you know, we, we.
We didn't just do thatright outta the gate.
We, we tried a couple differentiterations of, um, of kind of individually
project managing, but you know, wekind of, I think we fell short at

(06:14):
times, um, because we weren't leaninginto what we were really good at.
And so.
Um, since we actually made that switch,uh, or kind of established those
roles about, I would say a little,maybe a little less than a year ago.
Um, and we've just, we've, we've reallyseen things start to kind of click for
us and, um, and a lot, a lot of happyclients and, you know, we're keeping

(06:37):
things on schedule and on budgetand communications a a lot tighter.
Um, so, so yeah, that'swhat's been working for us.

Eric (06:43):
Yeah, that, that, that's super interesting.
'cause you know, I I, I,I do find that people.
When, when everyone kind of triesto, to, to sort of do a little bit of
everything and you know, kind of bringingin their own projects and managing
their own projects, like, you know,it can be a lot more difficult than
really identifying, you know, the rolesand responsibilities, kind of setting
those clear lines, you know, those,those lanes on who's gonna do what.

(07:05):
And, uh, you know, it sounds likeit's, it's kind of been a good welcome
transition for you all to, to reallyidentify that, you know, and, and, and,
and you're both still very involved in,in every project, but like, it's got
a little bit more of a clean handoffinto who's gonna manage what exactly.

Bob (07:19):
You just, you know, you try to eliminate overlap.
And I had a, um.
An old boss that, uh, he had a, a saying,he is just, everything had to have, he
called it an a OL we'll just call it, youknow, whose butt is on the line for, for
this, for this task and, and ownership.
And so establishing those that you know.

(07:39):
Who, who's on the hook for this?
Like there's, so we don't, we don't leavethings hanging in the wind and, you know,
thinking, oh, well I thought you had it.
I thought you had it.
Um, and I think that that's been,'cause it's, you know, I've had a
couple of other ventures, um, and youknow, partnerships don't always work
out, you know, the way they thought.
But I think that that's been ahuge piece of, of, uh, our success

(08:01):
and our partnership has been.
Um, that ability to communicate.
You lean on each other,there's a trust there.
You, you know, letting, letting theothers, you know, focus on, on their
strengths and their tasks and focusingon your own and just, you know, making
sure that you're constantly communicatingand collaborating, moving up all forward.
So, um, yeah, that's, that'sbeen working really well for us.

Eric (08:24):
That's awesome.
So when you think back about, youknow, again, kind of early, early
days, 2000, 1920, like what, what weresome of your first projects that that,
that you all found and, and took on?

Bob (08:35):
Yeah, so the first project where I kind of jumped in the middle
of it, um, was, uh, a, a customhome build in, in central Austin.
That ended up on the coverof, um, Austin Hill Magazine.
Um, so right out of the gate weworked off a very large project.
Um, and you know, I don't think any,I, I think, I'm not gonna say that we

(08:58):
bit off more than we could chew it.
Obviously, like, you know, thefinished result was, was there,
but there were certainly a lot ofbumps, you know, along that road.
Um, I mean, I can tell you from a, youknow, a back office side, like we're
really working from, from nothingin, in starting, you know, 'cause the
exist, you know, I'm trying to jumpinto this, this, um, this project

(09:20):
with just a, a mess of systems.
Um, and I think this is a reallygood kind of transition into like.
Why?
Um, you know, I think project management,budgeting software is, is just critical,
um, to the success of a project.
Um, but that was, you know, thebiggest challenge that we faced.
And so it's kind of, you know,that's, that's really what I

(09:41):
got into the business, you know,at, at that time to do, was to
kind of build out those systems.
But, you know, it was, it wasn't easy.
It was hard, especially nothaving the industry background and
understanding the construction business.
So I'm learning on the fly, havean idea of what we need and,
and how it needs to be done.
And, you know, I'm, it's, I I wasn'texactly work, the company I was working

(10:05):
for wasn't, you know, bleeding edge whenit came to that kind of stuff as it was.
We were, we were a bitof a mess too, but, um.
That's when I started, uh, reallytrying to figure out, okay, well
what can we do to be more efficient?
Where are we spending all this time?
Why is it taking me so longto generate an invoice?
Why, where, why, why does our budget,you know, look like this and relied on,

(10:28):
you know, all these, these key entries?
So, um.
That's when we, we brought on ourfirst, you know, or, or signed up for
our first construction management, um,software and the, you know, working with
some, some guys on the team at the timethat were not really willing to play

(10:51):
ball, you know, and want to do that.
I'm sure that that's something that youguys experience all the time, um, in.
Getting people to kind of buy into the, the software was, it was a
bit of a challenge and especiallybecause on it didn't work, you know,
and it's so the first, and I don'twant to throw anybody under the bus.
Um, but, you know, itjust, it wasn't functional.

(11:13):
I mean, this, it's, it's a well-knownsoftware and at the time, you know,
the budget was, was, was my biggestpain point and being able to.
See at a glance, where is this project?
How are we tracking?
Where are we, you know, where, whereare we missing a change order somewhere?
Where are we, um, you know,against our, our target?

(11:35):
How much money are we gonna make on this?
What can, what can we afford to, youknow, who can we afford to bring on?
Or, you know, what canwe invest in the company?
And there was just nothing.
And then we were stillspending all of our time, um.
You know, kind of trying to make thesoftware work on, on calls with their team
and having them trying to troubleshootand figure out what was wrong.

(11:57):
And, um, yeah, so it was,it was a bit of a challenge.
And then, um, you know, we migratedto another software after that,
which was a probably overkill forwhat we needed, but, um, was what's,
was what we wanted, you know?
Um, it was, we were paying for alot of bells and whistles that.
Weren't really relevant to anorganization that was focused on

(12:19):
residential at the size that we had,but it worked and it worked really well.
Um, and it was, you know, it,it, it, it solved that problem.
But, um, you know, that's, that'swhen we, you know, we were up
for our contract renewal there.
That's why we ended up jumpingon with, um, with job trade.
And we've only been using youguys for a couple of months.

(12:40):
I mean, I think it's, uh, Juneis when we did our onboarding.
Um, and so, um, yeah, kind oflost my train of thought there,
but, you know, that's how we endedup, you know, with job tread.
And that was, that was really,like I said, one of the bigger,
bigger pain points for, for mein, in building out the business.
And, and really in all of that, youknow, the important, the, the most,

(13:05):
the reason why it's critical to us Iis to free us up to focus on the things
when we're adding the most value.
We need to be engaging with our,we need to be spending more time
with our clients, more time withour subs, more time in the field.
Those are, those are what, thoseare the elements that make a
successful construction project.
And if you're in the office all the time,you know, and it takes you a half a day to

(13:31):
generate an invoice and um, or send out anestimate, um, do any of those things like.
You, that's just less time that you'respending on, on the important stuff.
The prob, like he said, theconstruction is, is problem solving.
Um, and if you're spending all daydoing, you know, that stuff, you're not,

(13:51):
you're not, you don't have the bandwidthto, um, to focus on what's important.
So that's, that's, it'sjust a big deal to me.

Eric (13:58):
I, I, I think though, you know, again, like what, what you sort of
figured out very quickly though isthat you needed a lot more visibility.
And two, the financial aspects ofmanaging these, these projects.
And, you know, even though you kindof went through a handful of different
softwares, like, you know, the, the,the key is because like so many people
don't, you know, they, they, they, theyjust don't ever really have that epiphany

(14:20):
that like, man, like we need to bemanaging the job finances in real time.
And we can't just wait till the end ofthe job and just have a, you know, a
hope or wishing a prayer that somehowwe're gonna make money on this project.
Like so many contractors do that.
And so it's, it's awesome thatlike, you know, again, like.
You had that experience and you knewthat you needed to find a solid piece
of, you know, software, you know, projectmanagement software to help you to make

(14:43):
sure that you don't go down that path.
'cause so many people would takeon that huge, you know, first
project and just, you know.
Totally lose their ass and thenhe'll ultimately end up saying,
nevermind, this isn't for me.
You know, I'm, I'm, I'm gladthat you guys at least kind of
knew that you needed something.
Now, you know, again, it's, there's,there's a lot of different flavors
of, of, of software out there and,you know, some of them are much
more, you know, antiquated andthen started 10, 15, 20 years ago.

(15:07):
You know, not, not, you know, may,maybe not as modern or easy to use, but
you know, at the end of the day, likeyou knew that you needed something.
And that's, you know,I'd say that's step one.

Bob (15:14):
Yeah.
Yeah.
And I think you, you hit onsomething else was the real time.
Um, and that's, I, I think that that'sone of the things that y'all's software
does better than anybody else is.
It's, and again, for us, and every,every, you know, every different things
are designed for different systems.

(15:36):
We're, we've been really happy withJob Tread because I feel like it was
designed for what we do specifically, so.
The, the real time nature of your, themobile app and, uh, the, the amount
of steps it took me and some of theother softwares to issue a change

(15:57):
order and how that was, in fact thebudget and all these other things,
it was, it took forever and ended.
What ended up happening was sometimesthose change orders wouldn't get out.
And the clients wouldn't havethe opportunity to say no.
Right?
And that's, that's something that wepromise, uh, if, you know from the get go.
Is the, we want to put the clientsin charge of their own budget.

(16:20):
They, they, it's their money, right?
It's our job as builders to makesure that they're, you know,
comfortable with what they're getting.
Um, you know, most of our clientsare, we're working with, with normal
folks that have, you know, this isthe one of the most ex, you know,
aside from maybe the purchase of thehouse, um, you know, it's the most
expensive thing they're ever gonna do.

(16:43):
Um, and they're, you know, it's, we'vegotta make sure that they understand
where they're going and, um, the,when, when we, you know, have a client
meeting, being able to either, youknow, on the phone, in the truck, like.
Right then and there.
Fire off a, Hey, we talked about this.
If we want to go with this elevatedfeature, add this to the scope.

(17:06):
This is what you're looking at.
Right?
And being able to put that change ordertogether, send it off and be like, we
can't start this until you sign off on it.
Um, is is critical and it's something thatwe've gotten a lot better at and we've
seen the benefits of since we startedusing Job Tread because it's so easy.
To send those out.
And I'll say it's the samething for the, the expenses.

(17:28):
That's the simplest, and I,I mean this in the best way.
Don't mess down version of anexpense entry that we've ever had it.
It is ridiculously easy to use.
To do it from your phone.
It's almost easier to do it from our,from the phone than it is the computer.
I mean, they're, they're comparable,but just having that kind of, uh, you

(17:52):
know, duality or, you know, whateveryou wanna call it, optionality
to, um, to put those in is what.
The, the ease of data entry contributesto that real time data and um, you know,
cus project budget being more accuratebecause it's so easy to, to, to enter in.

Eric (18:11):
Yeah, absolutely.
You know, I, I think you saidsomething really interesting there.
I mean, like.
The, the, the, the goal of putting theclient in charge of their own budget.
You know, I think so many times people,you know, sort of feel like, you know, as,
as a contractor, like, you know, it's upto them to, you know, figure out what this
is gonna cost and, hey, this is the cost.
If you can't afford it, thenmaybe we're not the right one.
You know, I, I, I love your approachof like, let you know you, you wanna

(18:34):
work with them and make sure they know.
They're in control andyou give them options.
It's like, look, if you can't afford,you know, the high-end premium, luxury,
you know, X, Y, and Z, then great.
Like, we can, you know, let, let's lookat something, you know, middle of the line
or, or maybe we need to look for somethingmore affordable, like helping them
to, to really understand the impact oftheir own selections, their own choices.

(18:55):
You know, because like at theend of the day, like, you know,
you probably don't really carewhat what they wanna implement.
You just need to know what can youafford, what are you gonna be happy with?
And we're happy to get it done.
But like, making that process easier forthe, the homeowner, you know, or for,
for, for the commercial property owner,like to really understand the impact.
Of their decisions on that budget.

(19:16):
I mean, that, that's thename of the game here.
At the end of the day, if they'rehappy and they're willing to spend,
you know, any amount, awesome.
Like you, I'm sure he will oblige.
If, if though they got a tight budgetand they need to stay within that, you
know, the worst thing that can happenis like, you just overrun the budget.
Now they're like super upset.
You know, I think by, by puttingthat power back in their hands and
giving them that ability to, to seewhere they're at in real time, you

(19:37):
know, just makes it a much bettercustomer experience in the long haul.
Yeah.
I mean, and I think

Bob (19:42):
the, you know, the most important part for us, and I think
this goes for, for most builders,it's, it's client education too.
Like, in addition to being, uh, the, thebiggest expense a a lot of our customers
will make, it's also gonna be the, um.
The, it might be the onlytime they ever do it.

(20:04):
You know, it's not something thatpeople are building up and like, you
know, they did one little project andanother little project and they're
just like going up and up and up.
A lot of times this is, you know,people bought their forever home.
They're ready to, to make it theirs.
Um, like, let's go.
But most of the clients that we talk to,they, it's, it's analogous to, you know,

(20:26):
they think it's just like buying a car.
Like, I want this car.
It's this price like here, you know,if we're coming, you know, ideally
we're always involved as early aspossible in, in any project, right?
Um, but you know, if somebody's.
Well ask all the time, we'll,we'll, we'll go on a, a site visit.
There's a lot of pointing.
I want this here andthis here and this here.

(20:46):
Like, tell me how much this is gonna cost.
And it's like, I somewhere between50,000 and a million dollars.
I don't know.
So it's, it's in that range, right?
And so for us it's about being, youknow, a, a coach and a resource.
Okay.
Even if you don't work withus, like this is how this, this

(21:07):
process is gonna work, right?
This is what you need to do inorder to have a successful project.
And especially if you're gonna,you know, stick to a budget.
You need to go through, youknow, a, a, a design process.
You, you know, really should havea builder involved because a lot
of times clients, they're gonnago nuts pointing and shooting.
They're gonna get to, um, youknow, their finished set of plans.

(21:31):
They've designed, you know, withthe, it's the architect's job to
get the client what they want.
Right?
And to, to put that down on paper.
But they're gonna design if, if there'sno control on, on costs here, people
are gonna, you're gonna design, youknow, something that's two, three times.
You know, what they wanna spend.
So that's where, you know, we, wetry to use that example as a, a

(21:52):
way to get in early and create thatfeedback loop in the, those bumpers.
And sometimes clients don't, you know,they'll, they're hesitant to, to give
you a budget because they think like,oh, well what if it only costs half this?
First of all, it never costs half that.
And that's, that is just people,very rarely do we get somebody that.

(22:13):
Has a budget that's two or threetimes what something is gonna cost.
That's, it just doesn't happen.
And if it did, it wouldn'tchange the way that we bid it.
That's not, we're a cost plus builder.
We're very transparent.
We don't just inflate the price ofsomething because we can get it.
That's just not, that's not what we do.
So it's getting clients tounderstand that process.

(22:36):
Having a builder that can, you know,just based on a sketch conversation, be
like, Hey, if we do this, then, you know.
That's, that's gonna, that's gonnamax you out on your budget, right?
Like, this is kind of where the, thescope of the project needs to stop.
Like we can't do the, youknow, add on the extra bathroom
or, you know, whatever it is.
Um, and so that's a big piece of, youknow, what we do as far as putting

(23:01):
clients in control of their budget ishaving them understand that process.
That it is complex and I won't know howmuch your project really is gonna cost
down to the penny until we're we'redone, which is can be scary for people,
but we're really good at establishinga budget right In saying, Hey, we're

(23:24):
gonna be within this, you know, range.
Um, you know, overall in, in your project.
Um, you know, but anotherexample by partner, his.
Um, when he was in production,you know, they get a new set
of plans and a new development.
It'd take him three times building thatexact same house before they really dialed

(23:46):
in every single detail and didn't, youknow, eliminated the conflicts, um, in
the field and, you know, any variationbetween structural and architectural and
you know, how everything fit together.
I mean, it's three.
Three cracks at it.
We don't have that.
You know, there's gonna,there's inevitable rebuilds.
We obviously, you know, we doeverything we can, um, to avoid that.

(24:07):
But it's, it happens, andespecially in remodels, right?
Like you need to work in a,a healthy contingency budget
budget based on your unknowns.
And so there's a big, there's a lot of,you know, my sales process is just, it's
way more education than it is, you know.
Tooting my own horn and, and, youknow, talking about how great we are.

(24:28):
It's really about educating the,the customers is the, how this works
when you're doing some, you know,a, a custom builder, custom remodel.

Eric (24:38):
Yeah, I, I, I think that, you know, that that really is, is what I've seen,
is it, it just, it helps tremendouslyto build the trust with that, with that
client, even before they become a client.
Like when they, when, when they feellike you, you are, you know, genuinely
trying to help them understand andeducating them on the process and.
That's like, Hey, look, evenif you don't go at us, like

(24:58):
this is what you should know.
This is what you should expect.
Like, I think that's, that's, that'stremendously valuable to, to really help
establish that relationship of, look,I'm, I'm, I'm here as a trusted resource.
And I think, you know, with thecost plus model, like at the
end of the day, it's like, look.
You know, we're, we're happyto do whatever you wanna do.
You know, again, you're, you'rein control of that budget.

(25:18):
You know, I think when they, when, whenthey feel that and they can understand
and appreciate that, it, it, it, itdoes sort of eliminate one of those,
you know, oh, is this just another salesguy trying to, you know, sell me the
biggest ticket item, you know, versuswe didn't want to do what's right.
Well, there's two

Bob (25:31):
things that we, we.
You know, need to address wheneverwe're talking about cost plus one, and
this is just, this is a mistake thatwe've made in the past, is just because
it's a cost plus doesn't mean it's justlike, alright, well, you know, at the
end of the project we're a little bitover and, you know, well it's cost plus.
And like I said, it's, that's,that's the worst conversation

(25:53):
to have with, with the client.
When you're in a cost plussituation, you still have a target.
You know, if you don't, if youjust blow through your cost plus
estimates and you're like, well,I'm covered, like you're gonna
have a lot of unhappy customers.
So yeah, what we.
You know, that's, that's, you know,it goes back to the change orders.

(26:14):
It's like, hey, if something'strending over budget, that needs to be
communicated and it needs to be exp,you know, explained, Hey, this went over
because of why it could be of, you know,we've, we've had, um, you know, we.
Prices were going crazy on PVC, you know,there were just building material costs
were just in flux and they were a littlebit more expensive than we thought.

(26:37):
And, you know, in a remodel therecould be a detail on there that, you
know, turned out to be a little bitharder to execute or, you know, what
was on plan wasn't really gonna work.
So we had to, to modify it, andit was gonna be a little bit more.
Those things need to be communicated.
There needs to be a,an expectation set for.
That, you know, that those things do comeup and what's gonna happen when it does.

(27:00):
And, um, you know, for thingsthat are unforeseen, that's
what the contingency budget for.
You know, it's a we'll issue, achange order, a $0 change order
that pulls from that budget.
But it's, it establishes, you know, atthe end of the project, you know, we ended
up using half of our contingency budget.
Like, what, what happened where,like what did we need that for?
Well, here's, here's the papertrail of everything that, you

(27:22):
know, that led to that and, and.
Ideally, it's not really a questionat the end of the project 'cause
it'd been in the loop the whole time.
No.

Eric (27:31):
When you, you, you know, you've kind of talked about you,
you did the, the custom home build.
You've done some remodels, I knowyou also do some light commercial,
you know, when, when you think aboutthese different types of projects, you
know, what, what do you see as, as thebiggest differences between them and,
and do you, do you have a preference?
Like how do you, how do you evaluate,you know, a, a full home build from a

(27:51):
remodel versus a commercial project and,and, and sort of what's, what's like
the average, you know, price point forthose kind of duration, things like that?
Yeah.

Bob (27:59):
Well, um, for us, you know, we have our process and
we also have our, our sub base.
Like we know what our teams can do.
Um, you know, we're always lookingfor, for talented tradespeople,
but we also very much value thebuilding a trust, um, with a team.
And, uh, you know, somebody thatunderstands your expectations for,

(28:22):
for quality, for cleanliness, for.
Showing up on time, you know,for all the things that you need
for, you know, a good, you know,sub general, um, relationship.
So our subs do kind ofsome light commercial work.
We're just, you know, we're not doingmultifamily, we're not doing big,
you know, industrial or tilt wall.

(28:43):
Like, we kind of know what's inour wheelhouse, so we truly treat.
Every project the same, whether, youknow, we did a, a sound wall for, uh,
in a, in a high rise, but it, it was,it still flowed through our process.
Just like a, you know, a kitchenremodel would, there's, it's the

(29:05):
same, um, you know, getting ourmaterials list and, and selections
from the client and, um, building outa schedule and set like it, it's, it.
For us, they're, they're really the same.
And we, the light commercial projectsthat we do, as long as that's, you know,
we've got the team to execute it and wecan flow it through our system and make

(29:28):
sure that our boxes are checked, then, youknow, the projects, uh, it's a good fit.
You know, we, we need to make surethat it obviously, um, you know,
schedule is, is a big thing for us.
Like.
We don't take on more projects thatthan we can be at every single day.
So that's, you know, a big, uh,you know, when we're choosing

(29:51):
projects, that's really important.
But, you know, as far as thedifferences go, there's, there's
obviously different priorities.
Um, I think, uh, when you'reworking, um, on a, on a custom
home, um, you know, that's, that'ssomething that's, that people are in.
Every day, you know, and there's,there's an attention to detail that's

(30:12):
there that sometimes in commercialit, this is about, you know, if it's a
retail space and they've got a targetdate that they need to be opened by.
It's not to say that, you know, wenecessarily cut any corners, but
you, your speed becomes the priority.
Um, and so we, we, you know, we tryto understand those aspects of it too.

(30:33):
Um, but we've worked on commercialprojects that, that were, you know.
Every bit as detailed as, asanything we've done on a residential.
So it's, you know, we, you know, I don'twanna say we take it on a case by case
basis, but we kind of know and, and, youknow, the architects and designers that
we work with kind of know where we fit to.
Um, so, you know, we, we try totry to find the projects that are

(30:57):
in that, that sweet spot, whetherthey're residential or commercial.

Eric (31:01):
Sure.
And so are the, you know, are.
Do, do you find that the architects anddesigners, are they, are they bringing
you a lot of the projects and the work,or are you, are you also bringing them,
you know, to some projects where maybe it,it found you and you know that you need
some, some of that design help in there?

Bob (31:18):
Yeah, I would say it's maybe 70 30.
Um, as far as like the split orwhat I would say 70% architects
are, are kind of coming to us.
Um, and then 30% we're, we'rebringing, um, jobs to the,
to the architect or designer.
And that's when, whenever it is thatway, you know, again, we're, we're

(31:41):
very lucky to have a a, a pretty deeppool of, of designers and architects
that we've worked with before.
Um, I try to feel out con, you know,clients to who's gonna be the best fit.
You know?
Yeah.
Who is this?
Because when you're, you know, you'reowner, you're weekly or you know,
we do weekly owner architect clientmeetings for every project where this

(32:05):
is a, this is a big marriage, right?
Between the, the three of us, um, wherewhat's it gonna look like, you know, where
there's certain personalities that I thinkdrive better with other personalities.
Styles, um, you know,those kinds of things.
Like you've, you've gotta kindof make an educated guess on, you

(32:25):
gotta play matchmaker a little bit.
Who's, who's gonna be the best fit?
And that's, that's what we, youknow, that's what we try to do.
Have you

Eric (32:34):
found that there's certain type of client or, or project that just not a good
fit for you all and, and, and you sort ofwalk away or refer it out to someone else?

Bob (32:44):
Um, yeah, I mean, we've done both.
We've walked away from projects.
Um, I think that the ones thatwe've walked away from, we've
walked away really early.
Um, and sometimes, you know, there are.
Um, there's just some red flags and,you know, life is short and, you
know, we, these projects can be,they're already stressful, right?

(33:08):
Like, let's not make them more stressful.
Let's do what we can to make theseprojects fun and get our clients excited
about working with us and to finishproject and understanding that it's gonna
be messy, but developing that trust that,you know, we're gonna take care of things.
Um.
But sometimes, you know, youjust, you get a bad vibe from,

(33:31):
from folks, you know, and, um, incertain, and it's not demanding.
We work with demandingclients all the time.
Um, but there's gotta bea mutual respect there.
Right.
And unfortunately, there's, there'speople out there that don't have
that respect for people, that workfor them, with them, whatever it is.
Um, we are So is that

Eric (33:52):
worked?
One of the.
Is that like a red flag?
That, that, that somehow, like how,how are you picking up on that and like
what, what, what might these red flagsbe that like you sort of, you know,
'cause obviously like you said, theearlier you can detect that, the better.
Yeah.
You know?
Yeah.
To just, um.

Bob (34:08):
I don't, I don't know, a spidey sense like you Yeah.
You can get, you get vibes frompeople and I, I know I've hate
to just be like, yeah, vibes man.
Um, but it sometimes at the end ofthe day, it's, you know, how they
talk to you and how, how, how arethey, how do you think they would
treat you and your team and yoursubs, um, you know, through a project.

(34:30):
And that's, there's gottabe a mutual respect there.
There has to be what the biggest.
We won't take on a project whereit's us versus there's no versus.
And, and I think that that's anotherthing when you're working, we don't do
a lot of work for, you know, developersor, or flippers, um, because it's

(34:51):
you versus they are doing everythingthey can to drive that price down
as low as they can, and you're doingeverything to, to make as much money.
It's not, it's not a collaborative effort.
Our clients, anybody that we work with,they have to want us to make money.
Right.
They have to want us to feed our familiesand be around, you know, in 20 years

(35:15):
or however many years if there's a,you know, a warranty issue or whatever.
Like we, we need to, we needclients that want us to win.
'cause we want them to win and we allneed to be pulling in the same direction.
And if we're not, if I don't, if I don'tthink that I can get all of us pulling in
the same direction, then like it's, youknow, it's not a. It's not gonna work.

(35:36):
And I, I, no, that's, that is, I,I, I don't have, I don't think that
that's a science, I don't think thatyou can codify how you pick up on
those things, but I think you need tobe very direct in your, in, in, you
know, even saying that directly, like,Hey, I need to, you need to, you need
to be on the same page here, right?

(35:56):
Because if this is gonnabe a 12 to 18 month build.
And we're just gonna be at a, youknow, miserable in every call and
it's gonna be, you know, that's,it doesn't have to be like that.
And I think the key is reallyto establish, you know, those
ground rules from the beginning.

Eric (36:13):
Yeah, absolutely.
You know, I probably, the most commonthing I hear is like, when, you know,
when, when the client is, is, youknow, just opens up kind of complaining
about their last contractor and, youknow, everything that went wrong and
just all the situations, you know.
Heard a couple times wherethey're like, you know, they're
talking about litigation.
It's like, okay, like I,I'll just walk away now.
Like, you know, I, why, why would Iwant to get into that same situation?

Bob (36:34):
We would, we have worked for lawyers, but I know builders that won't
work, won't do projects for lawyers and.
That's, you know, I, I, there'sgood and bad in every profession.
Um, but yeah, if, if, if, if somebody's,you know, sued the last three people
that they've worked for, probablya big red flag to look out for.

Eric (36:55):
Yeah.
So it sounds like, you know, you,you and, and, and Jared have, you
know, built a really, you know,solid, stable of, of trade partners.
Like how, you know, how, how have yougone about that and, and, you know,
where, where are you finding theguys, how, how do you keep them, you
know, working for you and incentivizeto, to, you know, to be your go-tos?
Like, 'cause a lot of peoplestruggle with that, right?

(37:17):
Like, they, they struggleto find, you know, people.
They, they, they struggle tofeel like they can, you know.
Maintain that high level quality.
If, if, if they were to just do itthemselves or bring their own in-house
people to do it, like how, how doyou, how do you manage all that?
The scheduling with, with, with thetrade partners, things like that.
Um, I

Bob (37:36):
mean, I think it's, it's the exact same.
The exact same, uh, I don't know, belief,uh, you know, way of doing things that it,
it's the, the same relationship with usand the client is with us and the subs.
It's all the same things.
I want my subs to make money.

(37:56):
I want my subs to have a, a, a happywork environment that they wanna show up.
Um, and we're not the, you know.
I, I just, we're not the kind of, I, Ithink that we have very high expectations
and all of our subs know that.
And we know that sometimes thingsare gonna go wrong and sometimes

(38:17):
maybe somebody on a crew messes up,um, and is gonna redo something.
But, um.
And, you know, we're, we'regonna let 'em know, but we're
also not gonna belittle them.
And I do, I do think that, you know,for better or worse, that that is a
lot more prevalent in this industrythan, than maybe some others where

(38:37):
that's still kind of accepted.
An old school, you know,kind of hard nose, fist, fist
pounding, kind of a builder.
And that's honestly like, there's a lotof very successful builders out there.
And it's, I think it'sjust like a coach, right?
Like there's watching the Cowboysdocumentary right now, you've
got your Jimmy Johnson's hardnose, hard, you know, like.

(39:00):
Scream and yell coaches, and thenyou've got your Barry Switzer's
that are a little bit more like,Hey, we're all professionals here.
Like, you know, let's, let's createa, an at, uh, a positive atmosphere.
They're just, they're, I mean,at the end of the day, it's just
different leadership styles.
Um, that's how we do it, and Ithink our subs appreciate that.

(39:20):
And they also know, like, you know, youcan't take advantage of it because, you
know, it's, it, it, at the end of theday, like if, if you do, you know, it's,
we'll, we, we can bring somebody else in.
And so.
I, I think once you get to a certainlevel and there's, there's, um, uh, you
know, you've done enough of these projectstogether, that's what really helps.

(39:42):
Um, and, and can get you, youknow, you get them out of a pinch,
they get you out of a pinch.
Um, and you, you, you're not beatingthem up on price at every single turn.
You're okay with them making.
Some money, um, because you want,you're also gonna work, you know, you're
gonna get a higher quality product,um, and a higher quality finish.

Eric (40:04):
Yeah.
Do you have a process for, for vettinglike a, a, a new, you know, a new
SUBTRADE partner that you wanna bring in?
Yeah.
I mean, we, I,

Bob (40:12):
later this afternoon, if we've got a, a new sub coming into the
office, um, it's, I mean, I'm notgonna say it's like a, I mean,
it's effectively a job interview.
You know, how are you gonna show up?
What do you, what do you look like?
How do you present yourself?
Tell me about the projectsthat you've done in the past.
Tell me something thatwent completely haywire.

(40:32):
What are the GCs that youlike to work with doing?
Why aren't you working with, um,you know, what happened with the GC
that you don't work with anymore?
It's not of the same, you know, typesof questions you would, you would
have in a. In a normal job interview.
Um, but that's, youknow, that's the vetting.
Obviously, if we can go see somework that's, that's another,

(40:52):
you know, big, big piece of it.
Um, referrals, um, are, are, canyou know, what is your back office
like, how are you scheduling?
What are you, you know, how are youhandling that piece of it for, you
know, a lot of our trades, like, if.
If we have, we're always gonna preferthat somebody has an office manager,

(41:15):
somebody that can handle scheduling.
If not, if, you know, we've gottaunderstand your bandwidth and how you
work and the scheduling, invoicing,those are all critical pieces of it.
Right.
Um, where we've worked with subsin the past that we don't anymore,
I would say that that's the numberone thing that ends up, you know, we
just, we don't know what's going on.

(41:37):
You know, we're, we're, we're falling.
We'll try to get here this day.
Um, oh, I forgot.
Like, you know, but there's nota centralized like, Hey, this is.
If this is how we schedule or, youknow, some of our guys don't have an
office manager, but they're just veryorganized and they, they know exactly
where they're gonna be that week.
And, um, so those are all bigthings that, that we look for.

Eric (41:59):
If you find any of 'em that need, uh, need some software to help 'em.
I, I, I may know a guy Abso Absolutely.
You know, it's, uh, it's, it's, it's,it's really great insight though, because
you know, it, it, it, it ultimately canbe the difference maker between having
someone that's reliable, dependable,who's gonna do high quality work, is, is.
What is the team that they have in place?

(42:19):
How organized are they?
You know, how are they gonna manage theprocesses from scheduling, invoicing,
things like that, that are gonnadirectly affect, you know, how your
job is, is, is being run and performed.
So, you know, I think these are,these are all great, great questions.
When, when you, when you assign themwork, are you, are you having them like,
go and, and actually bid on every projectand what they're gonna charge you?

(42:41):
Or do you have like, youknow, agreed upon, you know.
Rates, you know, that, that, that you'repaying, you know, whether it's, you
know, per square foot, per linear foothours, days, you know, how, how do you
think about, you know, doing all that?
Well, I mean, I'll, I'llwalk you through our,

Bob (42:55):
um, our estimating process, which job tread has been a big
part of, um, streamlining that.
And so once I kind of got my, my bearingson your quantity formula feature, um.
I've been having meetings with my subsand sitting down and just getting pricing

(43:18):
lists, price per square foot for a levelfive, finish a level four, finish a level
three for hanging sheet rock for, um, youknow, foundations price per square foot.
Um, so what I'm trying to do in an effortto, you know, be, be to win more jobs is.

(43:41):
A lot of times, you know, if we're biddinga schematic before we have structurals
or something like that, we're make,you know, putting our, where I think
a lot of folks would just do kind of ageneral, you know, high level estimate.
Like, you know, giving a range on a coupledifferent spaces or big scopes of work.
Um.
I try to just get it to where I can putin using the templates, I can throw in

(44:04):
a schematic set of plans and I can givea rough idea of what we're looking at,
price per square foot for a foundation,for frame, for drywall, for paint.
Um, and I'm able to do that veryquickly in the takeoff tool.
And my favorite part about it iswhen I'm done with those takeoffs,
it's flowing straight into my.

(44:29):
Um, into my budget, and I have the abilityto, it's, it's so easy to tweak things
where, hey, on this project, maybe priceper square foot's not really relevant.
It's really easy for me to justeliminate that from the budget without
having created a whole differentline item and all these other things.
So, um, that's, you know, when we're.

(44:52):
Um, putting an estimate together.
I try to make it just as detailed,make it look like the final
budget that I'm gonna send over.
Um, but again, client education,uh, you have to tell them, Hey, I
don't have hard bids for this and.
The, the process is we're going,you know, once we're under contract,

(45:13):
'cause I'm like wasting my subs time.
I don't want, I don't wanna send themevery lead I get and have them bid a set
of plans if I'm not gonna win the job.
I have to know these prices.
Um, and so.
I'm able to do that a lot more.
I mean, if, you know, I, I, as abusiness owner and an entrepreneur,
I'm trying to get as much out of mybrain as possible, and I can't be the

(45:37):
one, you know, Jared and I are verygood at just shoot, you know, telling
ballparking stuff on an estimate, but,you know, that's, that's not the way we
want to do it moving forward and havingthose standardized price and also just
being able to speak with confidence.
How did you get this number?
Where did this come from?
My other guy, I got another bid who saidit was, you know, half that well, this

(46:01):
is why you have X amount of drywall.
It costs this much per square foot.
And then the labor to install itcosts this much per square foot.
I mean, your other guy, that's, it'simpossible to do at that price and he's
gonna ask you for more money later.
So being able to kind of stand behind,you know, the accuracy of those.

(46:21):
Super important, understandingthat process, that, hey, as we get
more detail, this is gonna evolve.
Um, these prices are gonnaevolve, but we're confident that
this is gonna be your range.
I need you to be able to spend thisin order to take this project on.
If you say, Hey, I need to do thisfor a hundred thousand dollars less.
So it's like, I, you know, Ican't, we're not the best fit.

(46:45):
You know, like we, we would needto establish a budget of this much.
And, you know, we have come under budgeton projects and if you know where that's
the best final invoice ever, when it'slower than what they were expecting.
Um, but you know, that's, you needthis to, to set those expectations
and understand the process of we,you know, we use specialized labor.

(47:10):
For, or, you know, for every tradewe don't have our plumbers also
doing electric and my trim guy's notgonna be the one painting, you know,
that's, we, our guys do one thing andthey do it really well, and that in
our opinion, you know, you deliver,delivers a, a higher quality product.
So yeah, the, that piece of it though,the, the estimating and, and the

(47:31):
way that we flow all that has been.
Great.
'cause we can be a lot moreaccurate, a lot faster.

Eric (47:37):
Yeah.
I, I love too how you're, you're, you'reworking with your trades to help sort
of them understand and figure out,you know, what could be a, you know,
unitized, you know, price for you.
You know, that's, that's super beneficial.
I think you're gonna really, like,we, we have an upcoming feature that,
uh, should be coming out any day now.
Uh, but it's, it's gonnaallow you to create.

(47:58):
New columns directly on your budget.
That can be, you know, essentiallyformulas, you know, where if you wanted
to see, you know, let's say you, yougot a fixed, you know, price from one
of your trade partners to, you know.
Hang some drywall or whatever, like ifyou wanted to easily be able to calculate,
you know, the, the, the, that cost persquare foot for example, like, you'd
be able to have that as a new columnwhere you could always kinda look and

(48:19):
see what it is, you know, just so thatyou can always kind of use that as a
check, you know, against what you know,you typically would pay per square foot.
Or if you even wanted to, you know,help them and show them kind of
variations from job to job and how,you know, you need to kind of get
that a little bit more consistent.
You know, I think it could be a reallyhelpful tool since, since, you know, it
sounds like you kind of hone in on that.
That square foot pricing, y'all are alwaysone step ahead, so that sounds great.

(48:43):
Luck.
No, I, uh, you know, again, I, I,I, I appreciate, you know, all of
the insight you've shared here.
So I'm, I'm curious though, like, when,when, when you think back, you know,
from, from, again, that the first coupleprojects you've run to, you know what
it's like, you know, managing, runningprojects today, you know, even just
general business advice, like what.
What advice would you give to others,you know, who, who maybe earlier on

(49:05):
in their career, you know, still gotone foot in the trades, trying to
kind of get into the business side.
Wanna start up something,wanna start their own?
You know, what, what, you know,what do you wish you would've known
that you now know, or what advicewould you give, give to someone
who's, who's earlier, earlier on.
Well, I mean, I could tell you my

Bob (49:21):
biggest mistake was scaling too fast.
We weren't always two people.
Um, we, we brought ontoo many people before.
We had a codified process and expectationsand, um, that's, you know, we, we
needed you, you, you get to a pointwhere you, you can take on all this
at this, you know, the work and youare kind of feeling some momentum.

(49:44):
But if you hire too fast and yourprocesses aren't codified, and
you just kind of throw somebody tothe fire, you're gonna be asking
yourself, why am I I'm doing your job?
Um, and that's, you know, I, I don't thinkthat we, you know, as we, when we're.

(50:05):
I don't think that I'm, and you know,whatever, for better or worse, at this
point, I'm not focused on growth asmuch as I am efficiency and process,
and that's where I'm laser focused.
I'm not trying to look past that.
I'm trying to get to a point whereeither I'm saying no to a bunch,
I'm bored and I'm saying no towork because we're at capacity.

(50:27):
I need both of those boxes tobe checked before we start,
you know, bringing somebody on.
Um, but.
Being operationally efficient andcodifying, like getting your process
down and having, being able to trainsomebody, hiring somebody before you
have any kind of training manual.

(50:50):
SOP, how are you gonnameasure this person's success?
Biggest mistake I made by far.
Um, and so I'm focused more on.
Getting the, the business and ourprocess and our checklists and our
to-dos and our scheduling and everything.
Dial down to the point where that piece,every project's obviously different,

(51:10):
but it needs to live in our framework.
And you, it can obviously, you know, pivotbased on the project, but there's certain
things that you have to do every job.
And I wanna make sure that we'rejust doing those things on every job.
Um, you know, before westart to, to to scale.
But, you know, using tools likeJob Tread, we are doing the same

(51:32):
amount of volume with two peoplethat we were doing with seven.
And that's, wow.
That's because of the, the efficiency.
So I'm, you know, I don't thinkeither one of us are, are,
you know, happy with all that.
And we know that we've got a lotof work to do on, on those pieces.
Um, before, you know, as we, we continueto grow, but, you know, we want to be

(51:54):
behind on, on hiring, uh, this timewe wanna make sure that we're not
hiring and then kind of scrambling.
Um, we wanna make sure thatwe're, we're just dialed in.
So that would be, that's my biggest.
Learning.
Learn, lesson learned, I guess,

Eric (52:09):
man, that, that is, uh, that is awesome, man.
I think you nailed it.
That's, that's so important for peopleto know is that, you know, again,
like you, you need to dial in yourprocesses, have them documented, you
know, really understand what does ittake to successfully sell, manage,
execute, deliver, you know, a, a projectwithin your business, you know, whatever

(52:29):
type of project that may be like.
They, you, you gotta define that.
I, I find so many people who they,they think they're just feeling
overwhelmed and they're stressed andthat they just need to hire people.
And, and, and like, it's like you'rethrowing bodies at problems that you
haven't even tried to understand.
You know, you gotta drill in and say,what is the real bottleneck here?
What is the real.

(52:50):
Issue and how can I fix that?
And so many times it, it's just the actof, of trying to identify it and then
come up with a solution to make yourselfor whoever, you know, whatever you know
is, is, is leading to that bottleneck.
More efficient.
Like so many times you can solve yourown problems without having to just.
Throw bodies at the same'cause that's not gonna scale.

(53:13):
And it sounds like you, you, you sawthat, you learned that firsthand, you
know, and then, you know, again, it'sso much easier and more affordable
to find, you know, some, some wayto leverage software technology.
To help improve efficiencies and again,to bring on full-time salaried employees,
you know, that, that, you know, I meanthere's just, it's so much better to take
your time to build a solid foundation andto get that, you know, machine like up and

(53:38):
running, well oiled, operating efficient,and then you focus on, on scaling.
But like, you know, again, youcan't put the car before the horse.
Yeah.
I think a lot of people do that.

Bob (53:46):
Yeah, no, I'm, I'm firmly on the horse right now, and then
whenever we're ready, we will,we'll start looking into carts, so

Eric (53:54):
I love it.
Well, look, Bob, I, I, I reallyappreciate all the insight and everything
that you've shared here about, youknow, how you and Jared have, have
built your business, you know, thechallenges that you've had, how you've.
You know, become a lot more efficientand systematized over the years.
You know, you guys are doing great work.
Really exciting to see the growth,you know, and the success that you
guys have and, you know, look forwardto seeing many more years of, of,

(54:14):
of great success from you guys.
'cause I have no doubt, you know, yougot a very bright future head and, and,
and you're doing all the right moves.
So, you know, thank you for, forbeing a great role model for everyone
else out there in the community.
Appreciate you coming on andsharing all that with us today.
Appreciate it Eric.
Thanks for having me.
Absolutely.
Have a good one.
You too.
Thanks for joining us for thisepisode of Builder Stories.

(54:35):
We hope you enjoyed the conversationand gained valuable insights that can
help you in your journey along the way.
Don't forget to subscribe tothe show and leave us a review.
And as always, if you or someone youknow has a story to share, please
contact us@builderstories.com.
We'd love to hear from you.
I'm Eric Fortenberry, and remember,every builder has a unique story.

(54:58):
Keep building yours.

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The Right Clients, The Right Subs | Bob Perez

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