Remodeler's Exchange: Under 40 remodelers' critical advice to young owners

TOM SWARTZ: How did you choose the remodeling business?

BENTON ROOKS: I started out in construction doing electrical work, and I did that for about two years. After awhile, I fell in love with carpentry and I started out working for framing and trim crews. My family background has always included business owners and entrepreneurs so I said, “Why not start my own company?” It’s morphed over the years from just a one-man crew to where I am running multiple projects. We’ve grown enough to even take on work that is out of state.

SCOTT BROWN: It wasn’t really something I had to think about. I went right into the industry out of high school, and I have not done any other job since then. My stepfather owned a renovation firm and I went to work for him at age 18, and about 5 years later I had an offer to manage a large basement renovation. I took that job and I’ve had my own company ever since.

SWARTZ: Do you have any major challenges that come to mind when running a business at your age?

BROWN: I don’t now. Starting out, probably exposure to the marketplace was our biggest problem. Starting out at age 23, there were a number of remodelers that had their name out in the market for a while so it took some time to grow the business name and gain the trust of the marketplace.

This month featuring:

Benton Rooks, 35
Owner, RBR Construction & Remodeling Co., Brevard, N.C.
RBR Construction & Remodeling specializes in custom home and multi-family renovations as well as commercial renovations. The firm averages between $850,000 and $1M annually, and currently has 2 full-time employees.

Scott Brown, 35
CEO, Brown Remodeling Co. Inc., Franklin, Ind.
Brown Remodeling Co., Inc. was founded in 2001, specializes in high-end interior remodeling projects and historical restoration work. The firm employs 4 full-time employees and their volume in 2012 was approximately $750,000.

SWARTZ: What did you do to make your name more recognizable in the marketplace?

BROWN: It was time more than anything else. As long as you continue to do the projects right and your name stays solid, it just takes time for people to get to know you. The more signs you can have on the street, the more trucks you can have lettered, results in the better marketing of your company. You just have to get out there in the public and have people see you and recognize your business.

ROOKS: Of course, we were no different than any other remodeling firm. A lot of it was getting your name out there. Another unique challenge when I started was that I moved to my current location in North Carolina from Wyoming, so I didn’t know a soul. Every job, I went out and did the best I could possibly do and tried to network to help grow the business. For those starting out in the remodeling business, don’t be shy and don’t be afraid to take risks. You’re going to run into many roadblocks, and you have to handle them immediately. It’s all part of handling a situation that involves your business.

SWARTZ: Did you have mentors or advisors that offered advice?

ROOKS: The first person I always turned to was my father, and I got a lot of help from him just based on his overall business experience. Second, I ended up becoming friends with a lot of my clients, and I was fortunate enough to have clients who were great business experts, and they were always willing to offer advice, answer any business-related questions. I was not shy about asking them business-related questions that would help me run my business.

BROWN: To learn the trade, my stepfather helped me out, but the trade aspect is just a small part of running a business. The business aspects have a lot more to do with your success than actually knowing the trade. Personally, getting involved with NARI and working with a lot of NARI remodelers, you can find a number of trusted remodeler advisors there to lean on for help.

SWARTZ: What level of importance did you put on trade magazines such as Professional Remodeler, trade shows, or education? Also, how important do you consider designations?

BROWN: All bring a separate advantage. The information from trade magazines, the articles, are excellent. You can gain some critical knowledge from the magazines because things change so quickly. They help you keep up with new products and business ideas such as ways to market yourself. As far as the designations, anyway to differentiate yourself from another remodeler in your market is huge. The designations are one major tool you can use to do that, plus you learn a lot in gaining the designations at the same time.

ROOKS: Continuing education is a must. Whether its trade magazines, reading business books, or attending a seminar at a trade show, these are all things you must do as a remodeler. If you don’t, you are at a disadvantage because the business changes every day. Anyone that is starting out, get every trade magazine you can and read them. Anything you can get your hands on about your business—read about it. Much of it is also joining groups and associations as part of networking. Finally, I am a very big fan of continuing education.

SWARTZ: Where do you get most of your continuing education?

ROOKS: A lot of comes from the Internet and trade magazines. The trade magazines are great because there are a lot of tips provided by others that can help your business—it can be a tip that leads you to a specific article or website. The trade magazines are probably my favorite source.

SWARTZ: Credit plays an important part of a remodeling business. What advice would you give about establishing credit for your business?

ROOKS: Go to the local lumberyard and suppliers to get a credit application—fill it out, don’t waste time. Second, always pay your bills on time. Having credit in this business is such a big part of your success. It is a must; you need to have great credit. If we didn’t have credit with all of our suppliers, it would be very tough to run a business. I cannot begin to explain how important credit is for a remodeler.

BROWN: It’s definitely a huge component of your success. A couple things I would add are: incorporate early, so you can separate your business from personal credit. Also, pay all of your accounts on time or early. Build a business plan; banks want to see a written business plan if you come to them for a line of credit.

SWARTZ: Would you advise anyone to get a line of credit at a bank?

ROOKS: Yes, a line of credit from a bank is real nice. I have one and we use it quite a bit. When you’re starting out, it can be tough to get this credit when you business is not established. Start small. If they give you a $1000, take it and use it responsibly. The next thing you know, you can get $25,000.

SWARTZ: Where would you advise someone to go to get started with a business plan?

BROWN: A small business administration adviser is the place to get started, and it’s cost-free. As you dig into it further, there is going be a tremendous amount of time involved. It took us about a year to build our business plan. As soon as it was done, it had already started morphing. It’s an ongoing plan that is really never-ending, and without that business plan, it’s hard for a bank to offer financial support.

SWARTZ: Are there any advantages or disadvantages to starting your business from scratch, and do you know of anyone who has taken over their remodeling business from a father or other family member?

BROWN: There are a few in our market that are second- and third-generation businesses. The biggest advantage is probably a consistent pool of leads and prospects. Trying to get that built can take a long time, depending on how aggressive you are. The disadvantages are probably going to outnumber the advantages when it comes to taking over a business. First, you are trying to run a business that reflects yourself, and not the previous owner. Two, how the previous owner ran the business may be completely different than how you want to run your business. A lot of remodeling owners out there do not know how to run a business. They got into it because they were swinging a hammer, and eventually ended up owning a business. When you dig into it, they may not run a business the way you would run it.

ROOKS: I know a couple of second-generation owners that took over very established businesses. One of the things I was envious about is that the new owners had someone walk them through the business-side of construction. I had to pick up and learn that side myself, which was quite a challenge. There are also disadvantages because you are trying to set yourself apart from how the business was originally established.

SWARTZ: Do you have employees that are in the field or do you hire trade contractors?

ROOKS: I had guys in the field, about 4-5 guys, for about five years. Recently, I started using subcontractors instead and now I have employees in the office. There are different schools of thought. I am switching over to having a project manager that can run things for me in the field. Having trade contractors now, when there is a problem they deal with it instead of me.

BROWN: We work with quite a few. We keep 3-4 field employees depending on our sales at the current time. I keep one person out in the field all the time that can handle anything when I am not there.

SWARTZ: Is aging of the labor force a concern?

ROOKS: Yes it is; you don’t see many young guys out there that are interested in learning the trades. If there are younger guys in the field, it’s more of a short-term job for them, a summer job or a temporary job. Many of the younger guys do not want to swing hammers and do manual labor that is involved in construction. I am not super-worried about it, but I am somewhat concerned. It’s a good idea to offer an internship to someone in a trade school during the summer. Show them the ropes, and show them they can make money in construction. You have to show them they will have to put their time in, but it may spark some interest in the profession.

BROWN: We created a relationship with a small liberal arts college in our area, we do an internship with them but we also hire kids right out of college that cannot find a job. If people are proactive and work with colleges, it can help your business. I have two guys right now that I’ve hired full-time from our local college. One is learning the field with aspirations of management; the other went straight into sales and management. Having a larger spectrum of opportunity offered by your company offers a better chance of landing some of the younger workforce.

SWARTZ: How do you manage you business, prioritize your time, and still be successful?

BROWN: If you can’t set an atmosphere of shutting your business down nights and weekends, you’re going to burn out. We’ve built a Web presence that works second shift and weekends for us. Our social media presence and websites are constantly working. Family has to be the number one emphasis.

ROOKS: You have to learn the business is always going to be there. You need to shut the cell phone off. I have it shut off from 7 p.m. to 8 a.m. You have to take time for yourself and your family; if not you are going to get burned out. You need to take time off to recoup. I’ve done the 70-80 hour weeks at times. Financially, there is no difference between working 40 hours and 80 hours per week. I used to have the problem of making small issues into big problems but I learned to get past that because they ended up taking too much of my time.

SWARTZ: What advice can you offer younger entrepreneurs looking to get into the remodeling business?

ROOKS: The first thing is to figure out what you want to do in this business. When I first started, I would take on any job. Try to specialize in one area. Come up with a game plan, set the right goals, and monitor your progress. Also don’t give up. You’re going to hit walls, you’re going to struggle, but don’t give up and don’t be afraid to take a risk. Maybe a big project comes your way, and you may be intimidated by it, don’t just throw it out. Find someone who can help you take on the project. Put your head down, move forward, and don’t be afraid.

BROWN: One of the biggest things we did is we went out and found the number one remodeler in the area. We took him out for lunch, picked his brain, created an on-going conversation with him on what’s working and not working—that was huge for us in terms of our success. That led us to hiring a business coach, which led to a business plan. We kept our territory small until we became the biggest fish; then expand from there and target your marketing because it’s so expensive. PR

This month, the Remodeler’s Exchange hosts two remodelers that are part of our 40 Under 40 Class of 2013. Professional Remodeler’s Tom Swartz talked with Benton Rooks and Scott Brown who offer tips to running a successful business, how and why they chose to enter the remodeling business, challenges of starting a remodeling business, and much more, all while under the age of 40.