0:01

Welcome to Contractor Cuts , where we cover

0:03

the good , the bad and the ugly of

0:05

growing a successful contracting company

0:08

.

0:13

Welcome back to Contractor Cuts . My name is Clark Turner

0:15

, I'm Jared Flo . Thank you for joining us this

0:17

week , welcome back . So today we are

0:19

diving in to a topic

0:22

we've covered before , but we get

0:24

a ton of feedback on this and a

0:26

lot of people wanted to know more about this , so we

0:28

thought we'd dive deeper into it . We

0:30

are talking about why we have

0:32

chosen to not hire any on-staff

0:35

labor and instead we got rid of

0:37

all those and we do only 1099

0:39

subcontractor labor , we went with a 1099

0:42

model . Yeah , so this is a hot topic

0:44

and we love discussing it because there

0:46

is a rhyme and reason . We didn't just do it

0:48

because it's fun . Honestly , it's

0:50

more fun to have a full staff of guys that all

0:53

are working for you and have a

0:56

big old 10 , 12 , 15 guys

0:58

that are on staff as our labor , that we

1:00

can build the camaraderie . But it

1:02

still happens the same way . You still have those guys

1:04

around , you still have the camaraderie

1:06

, but also full control

1:08

to where we're not taking advantage of the guys

1:10

and they can't take advantage of us . So that's

1:12

what we're diving into today . We

1:15

are going to start with defining why

1:18

we made the move from having our W2

1:20

labor into 1099 labor

1:22

. Yeah , so what would

1:25

be kind of pitfalls of

1:27

switching ? If I'm going to go

1:29

from W2 to 1099 , what

1:31

is the biggest pitfall that

1:33

might happen if that happens

1:35

?

1:37

Well I mean . So going back to a

1:39

part of the reason why we made the move is

1:42

because

1:44

of the cost of it . There was a ton of

1:46

cost on our side . We

1:48

were not seeing the productivity that we thought

1:50

we would see by having the control that

1:53

having a W2 made

1:55

us feel like we had Right W2

1:57

employees , makes me feel like I've got control of them . They're

2:00

going to do what I say to do

2:03

and you feel

2:05

like that control gives you you're going to make more

2:07

money . We started running the analytics

2:09

of it . We started looking at the numbers and the reality

2:11

was it wasn't the case . We weren't getting

2:13

the productivity and

2:15

it was costing us a ton of money and

2:18

extra labor that we didn't necessarily

2:20

need to spend . It was costing us more

2:23

money that we were having to go back to charge our client

2:25

that we couldn't anticipate , as

2:27

well as the liability and insurance that

2:29

was on top of that For

2:31

us . We made the decision you know what we're

2:34

going to go and we're going to let these guys

2:36

go and we're going to push them to 1099

2:38

and allow them to work

2:40

1099 if they'd like

2:42

to . One of

2:44

the benefits of that is that something

2:46

that we say is like the cream

2:48

rises atop . In that situation . The

2:51

ones that were really worth it and

2:53

grinding and willing to put in hard

2:55

work saw the opportunity in

2:57

that spot and were able to increase the amount

2:59

of money they were making . The ones that were milking

3:01

it and just kind of enjoying

3:04

the fact that they didn't have to do as much but got paid the

3:06

same , those guys didn't

3:08

like going to that model .

3:09

I think one of the big things with it also

3:11

is when

3:13

, if you look at a manufacturing

3:17

plant , the labor in their assembling

3:20

on the assembly line is

3:22

all W2 labor , because there

3:25

is a way to measure and execute those

3:27

people sitting in that assembly line . We've

3:29

got to make a thousand products

3:32

a day that assembles this way and

3:34

that will happen no matter who's sitting in

3:36

that chair . That's great . You

3:38

can manage that labor sitting in that chair

3:40

on the assembly line . It works great . When

3:43

we get started and when I'm launching a company

3:45

, I'm out there on the job site . I'm

3:47

on every job site every day doing the work

3:49

with the guy . It makes sense for me

3:52

to bring that W2 guy on and hire

3:54

him as an employee who's also

3:56

doing labor with me because he's my assistant and he's

3:58

on the job . I can sit behind his

4:00

assembly line and say hey , man , I

4:03

need you to carry that now . Hey , it's time for your

4:05

break to be done . You've had a 40-minute

4:07

smoke break . Come on , man , let's go finish . W2

4:11

works in those situations and most

4:13

GC companies start in that situation

4:15

. It's I'm going out to do the work . I'm going

4:17

to be on every job site so I can hire

4:19

my buddy who's really good at X , y

4:21

and Z to come with me and I'm going

4:24

to pay him hourly daily labor

4:26

to do this work with me as my assistant

4:28

. Then you start hiring another

4:31

guy and another guy . You start growing and these

4:33

companies started with a

4:35

foundation of that's how we do labor . The

4:38

problem is , as you get to a project

4:40

manager level where I'm managing four

4:43

, five , six projects at once , I'm

4:45

now on site two to three days a week . I'm

4:48

not on site five days a week and so

4:50

I'm losing control

4:52

as the leader on the job site

4:54

to push everyone to get done , I

4:56

went from babysitting people on the

4:58

job site who are my assistants and helping

5:00

me do the work to I'm

5:03

now giving them responsibility to get

5:05

this done as quickly as possible and have zero

5:07

motivation for getting this done quickly .

5:09

Well , and what's interesting about that is that when you

5:12

are managing W2

5:14

labor and you're on site , what

5:16

you don't realize is just the fact

5:18

of your presence on site makes

5:21

them do things that they wouldn't do

5:23

if you weren't there . Correct Right you

5:27

know they'll take 17 smoke breaks

5:29

if you're not there . If you are there , they're

5:32

going to push through and they're going to get stuff done .

5:34

You're setting the bar , that's right .

5:36

But they're going to perform at a level

5:38

just , whether you said it or not . They

5:41

know the bosses stand in there . So they're not going

5:43

to act , they're not going to be lazy , they're

5:46

not going to take an extra break and all the different

5:48

stuff .

5:48

It's not malicious , it's just nature

5:51

, human nature of like . All right , I just

5:53

kind of worn down . I had a hard night last night

5:55

partying with some friends and I'm just , I

5:58

just need to sit down , right .

5:59

I mean , it's the same thing of like you got a full full of people

6:01

that are doing , you know , operations , work , and

6:04

then all of a sudden the big boss comes to visit for

6:06

a day . Everybody is sitting there typing

6:08

properly and doing the things , and you know that's

6:10

just natural . It's the way it's going to happen . But

6:12

, like you were saying , as you start moving

6:14

into a more of a project management role

6:17

and growing your company , you're going

6:19

to have to back off of being on site

6:21

five , six , seven days a week . They're

6:23

going to be there twice , three times a week . So

6:25

the over 50% of the time

6:27

that your W2 labor is

6:29

on site , you don't know

6:31

how they're acting . You're hoping and thinking

6:34

that they act the same way that they did

6:36

when you were on site with them , but you have

6:38

no way of knowing that .

6:39

Well , and even when you're there two to three days a week , you're

6:41

there for an hour right . Hour hour and a half maybe

6:44

, maybe 30 minutes , stop in to look at some

6:46

things and get some materials ordered . I am

6:48

spending . I go from being on site

6:50

for 40 hours in a week to being on site to

6:52

three to four hours a week , and so that

6:55

is where we what you don't understand

6:57

. Moving out of the swing and the

6:59

hammer and being off site is what

7:02

your job is now as a project manager

7:04

is . I've got to do marketing . I

7:06

got to find the clients . I've got to do

7:09

estimates . I've got to call all

7:11

of the client , communication and management

7:13

. I now have to make my labor

7:16

to keep their schedule , get them on

7:18

site . Got to order the materials . I've

7:20

got to do permating I've got to do there's so many

7:22

things you got to do . If you have

7:24

W2 , you've added a

7:26

huge job which is babysitting

7:29

and motivating the guys to work hard

7:31

day in and day out , when you're not around

7:34

.

7:34

The seven to eight am phone call every single

7:37

day , from every single one of them going hey

7:39

boss , what do I do today ? Where do you want me to go ? And

7:41

they go do that thing . And then they pick up the phone All right

7:43

, I did that thing , what do you want me to do now ? Right

7:45

, and it becomes this cycle . It

7:48

becomes this thing , now one

7:50

of the things , just to add some clarity to this for

7:52

us and our perspective , all

7:55

of this is born out of the desire

7:58

to grow a

8:00

company that is a long term

8:02

sustainable business . That

8:04

is what this is a part of the way

8:07

that we view this . If your desire

8:09

is to you know what ? I'm just going

8:11

to grind . I'm going to stack cash , I'm good with my money

8:13

, I'm going to put money in a

8:16

Roth for the next

8:18

20 years and I'm just going to be on site

8:20

. I'm going to have my five , six guys and my labor

8:22

guys and I'm just that's how I'm going to operate

8:24

. Then , w to it up , w

8:26

to it up , that's fine . But

8:29

if your desire is to grow something that's

8:31

going to be bigger than you and will outlast

8:33

your ability to work , you

8:36

can't operate on a W2

8:38

model . Yeah , because it's difficult . It's a lot

8:41

harder , it's very difficult .

8:43

It's a lot more costly . I think one

8:45

of the things that got me that

8:47

clicked in my brain that a lot . When we

8:49

say it this way , it clicks in a lot of people's brains Every

8:53

single day . If I have hourly or daily

8:55

labor as an employee or

8:57

salary , even whatever it is , every

9:00

day when they're on that job site , either

9:02

he wins and I lose , or

9:05

I win and he loses . Yeah , I'm

9:08

paying him $300 for that day to be on site

9:10

Me either generated

9:12

more than $300 with the work that day

9:14

or didn't quite put enough in and

9:16

generated less . When I have

9:18

a W2 , either I'm taking advantage

9:20

of that guy and so I'm making a lot of money

9:22

off him , or he's taking advantage of me and

9:25

I'm trying to pull him down the road to get his job

9:27

done and I'm paying him more than he's worth that

9:30

setup . One of us is losing . I don't

9:32

want my labor guys , the guys that are

9:34

delivering my product , to ever lose At

9:37

the same time . I can't run a successful company if I'm

9:39

losing . How do

9:41

we make it to where it's extremely fair

9:43

for both sides ? That's it . Yeah , that's

9:46

why we moved it to 1099 . That doesn't mean

9:49

that the subcontractors are

9:51

just off on their own and they just

9:53

I give them the work order and they

9:55

go do the work . However they do it . That

9:57

is what we're going to talk about next , of how to work

10:01

and mold your partners as

10:04

subcontractors into being a

10:06

true partner for you . But

10:08

if you can do that part of it and that

10:10

aspect of treating them

10:12

like a partnership , to where they're running their

10:14

company as a subcontractor and

10:17

you're running your company as the project manager

10:19

and together you're executing this

10:21

job , then they

10:23

are gonna win and grow and make a lot more

10:25

money , and instead of spending half

10:27

of your time babysitting the crews and doing go

10:30

back work , you're now able to double

10:32

the amount of work you're doing because you

10:34

have that task taken off , because they have to be

10:36

self-reliant and self-responsible , so

10:38

it and they get paid for exactly

10:40

what they deserve . And so that's why we've

10:42

switched it over , because I don't wanna

10:44

take advantage of them and I don't want them to take advantage

10:47

of me , and I wanna cheer for them to make

10:49

more money , not try to hold them down and not

10:51

give them raises , because I wanna make more money myself

10:53

. The more money I can make my subcontractors

10:56

, the more money I'm making . Reverse

10:58

that the less money I could pay my W-2 , the

11:00

more money I'm making which one of those

11:02

sounds better as a company owner ?

11:04

Well , and it's funny because when you put it

11:06

that way , it makes a lot of sense . But in

11:09

the past , when we've put out podcasts similar to this

11:11

content , a lot of

11:13

people say that we move that

11:15

way so that we could take advantage of people . Oh

11:17

, you know what ? You just trying to grind

11:19

people into the ground and you don't care about the guys

11:21

doing the work , and blah , blah , blah . It's the opposite

11:23

of that for us . The

11:26

ones that we have that have worked successfully

11:28

in this model have been able

11:30

to not only put more money in their pocket but

11:33

also develop and grow as their own

11:35

business , because that's a part of

11:37

the model that we created and that kinda goes

11:39

into . My next statement is that you know , or at

11:41

the beginning of this conversation , you asked me what's

11:44

one of the biggest pitfalls of moving

11:46

from a W-2 to a 1099 model

11:48

, and I think the

11:51

biggest one is that if

11:53

you're not , if you don't set this up

11:55

well , it's very easy

11:57

for the who you are as

11:59

a company to get deluded because

12:01

you're bringing in 1099 companies

12:03

, another business to

12:06

interact with your clients . Be on your

12:08

job sites , put the paint on the wall

12:10

, show up on time . Not show up on

12:12

time , leave the job site crappy , like

12:14

all of the different stuff , that , if you

12:16

don't set it up correctly , you

12:19

end up losing the

12:22

control of the company , the

12:24

culture , what you're delivering

12:26

, the quality of what you're delivering

12:28

to your clients . And so the

12:30

move is how

12:32

do I set them up for success

12:35

? How do I help them

12:37

understand ? This is the way that I need

12:39

for you to operate . This is the way that

12:41

you're gonna every day . This is what I

12:43

need to happen , but also , in exchange

12:45

for that , here's what I'm gonna bring to the table

12:47

for you . Right , and so that's what

12:50

the big pieces that we learned to go into

12:52

this model . How do we set them up for

12:54

success ? Because the last thing that we want is

12:56

that our 1099 crews , individuals

12:59

and people we don't want them feeling

13:01

like just our tools that we grind and

13:03

then go buy a new one when they're done . That's

13:05

the last thing we want . We want them to become

13:07

strategic partners that work with us for

13:09

decades .

13:10

There's two jobs being done on our job

13:12

site . Right , it is

13:15

the project management stuff of the estimates

13:17

, the money management and all of that

13:19

, and then the execution of the actual labor . And

13:21

so we view our 1099 subs

13:24

, as you guys are

13:26

partners , and I do this job , you do

13:28

this job . So , on easy

13:30

numbers , on a $5,000 paint

13:32

job , I'm telling myself , listen , I'm getting

13:34

paid 2,000 of that to do all of this

13:36

. You're getting paid 3,000 of

13:38

it to just show up for four days and do the

13:41

labor whatever it

13:43

is . And so we're I'm being

13:45

very open with them and saying you could charge five

13:47

grand to do this , but you've gotta go find the job , you gotta finance

13:50

the job , you gotta land the client , you gotta

13:52

do the estimates , you gotta finish your work and go home

13:54

and go do estimates .

13:55

And you gotta collect on it . Yeah , and you gotta collect on it .

13:56

So if you're a grinder and just wanna go do the work

13:58

and collect money , let's partner up . I'm

14:01

gonna go , I'm gonna do everything else . All you

14:03

gotta do is show up on Monday , get a check

14:05

by Friday and start up next Monday for the next job

14:07

, right , and so it's a partnership that we do

14:09

with our subs , and the goal

14:11

of our partnership with our subs is

14:13

to grow them into bigger , more

14:16

robust companies to where they have a

14:18

better business knowledge of how to run

14:20

by working with us . Our processes

14:22

are so tight on how we wanna run job

14:24

sites . If I can teach you how

14:27

to do that and how to make more money on our

14:29

job site , you're gonna be a better businessman

14:31

.

14:32

Well , they're gonna see the value and the

14:34

efficiency that that brings , and

14:36

they don't . Some of them work not

14:38

exclusively for us , but they do a lot of work

14:40

for us , but they also do other jobs

14:42

and they're going to take that information

14:45

and go you know what this works really well over at their

14:47

jobs . Let's do that on these jobs . So , by

14:49

nature of it , they are developing a

14:51

better business acumen just from working

14:53

with us .

14:54

Now a lot of people don't like doing the

14:56

switch because they're like well , I don't have control of

14:58

his calendar anymore . As a subcontractor , I'm

15:00

not allowed to control his calendar . I

15:02

send them work orders when I want work done . He can go work

15:05

for other people and I wanna keep them on my bench

15:07

Right . And what I say back to

15:09

that in response is if you

15:11

have that type of control issues

15:13

, then this isn't gonna work well

15:15

anyways and , with that being said , if

15:17

you run your jobs and your

15:19

systems and processes better than

15:22

all the other GCs he's

15:24

gonna wanna work for you . And our subs we've had

15:26

. I distinctively remember when

15:28

I was a project manager running

15:31

crews , we had a couple subs that were

15:33

like hey , I got another job , here's a lead , and

15:36

I would . They wouldn't wanna work for other people , they

15:38

would just pass them to us because they don't wanna

15:40

do the estimates , they don't wanna do the communication , they

15:43

wanna show up and get work done . And so it was a

15:45

partnership where they stopped even taking

15:47

on homeowners because they were like

15:49

, listen , I could bid this at X amount , but

15:51

I'd rather take less , y'all manage the whole

15:53

thing and get me paid on Friday . So

15:55

if it runs better , they want

15:57

to come work for you because they can make more money as

16:00

a sub for you than

16:02

as a W-2 .

16:04

Well , and one of the mindsets in that that I always

16:06

taught to my project managers , who

16:08

a part of their responsibility was finding

16:10

new subs and vendors to use . Always

16:14

take the opportunity to put yourself

16:16

in their shoes , experience

16:18

the way that you run jobs , the

16:20

way that , from their side , if

16:22

you call them at 1130 at night

16:25

and expect them to be and send them a work order

16:27

at 1130 at night tomorrow morning

16:29

, I want you there and you do that over and over and

16:31

over . That's really frustrating Because

16:33

they didn't know until almost

16:35

the next day that they had

16:37

work tomorrow , right , and

16:40

if they don't have work tomorrow , they don't have enough

16:42

money this week to put food on the table , right . So

16:44

, understanding , don't wait till

16:46

the end of the night . Get them their information

16:48

that they know that

16:51

they have work coming as soon as you can get

16:53

it to them .

16:55

Your job as a project manager , as

16:57

an owner of the company running the company , or if

16:59

you're a PM inside of a company . I

17:02

want to fill up my own

17:04

pipeline of clients in the future

17:06

, but at the same time I

17:08

am responsible to fill up my labor's

17:11

pipeline for the next few weeks . So they

17:13

know what's coming Monday . For two reasons

17:15

One , they don't say yes to

17:17

other jobs and they know and they feel confident and

17:19

comfortable that you're gonna keep money coming

17:21

in for them . And number two , if

17:24

they don't get done by Friday this week , they're

17:26

gonna lose next week's work , and so

17:28

there is a motivation to get done

17:31

on the timeframe that we agree to , where

17:33

they're gonna put in the extra hours to get done by Friday

17:35

, saturday , sunday . So they can start that next time , so they can

17:37

start the next job on Monday , so it's a motivation factor

17:40

as well , as I'm gonna keep pumping you

17:42

money , keep pumping your jobs , as long as you

17:44

keep delivering the high quality product that

17:46

you're giving us .

17:47

Yeah one of the other things that I would say is you

17:49

know , we our GC

17:51

company essentially worked as a 1099

17:54

sub for some very , very large

17:56

, multi-billion dollar companies , and they

17:59

would send us their work orders or scopes

18:01

of work at a dollar amount

18:03

5,000 , 10,000 , 20,000 , whatever it

18:05

was . That was it . Here's the dollar

18:07

amount . Take it or leave it like it or not . Here's

18:10

what I will pay you to do this work . Right

18:12

Now we do

18:14

the same thing , because the a part

18:16

of the benefit of the work order system is

18:18

that we are dictating to our vendors

18:21

here is the work I want done and

18:23

here is how much I would like to pay to do

18:25

that . But we also , in our

18:27

contract with our subs , have

18:29

a spot that specifically spells out

18:31

to them if we want you

18:33

to make sure that you're comfortable with this , and so , within

18:36

the first X amount of time , if

18:38

you've got questions , problems , need to talk

18:40

about the money of this , let's have a conversation

18:43

. If it's not enough I'm

18:45

not saying that I'm perfect and I bid this perfectly

18:47

I thought that I had a dollar

18:49

amount that made sense . Let's go on site and

18:51

look at it . Oh yeah , you know what ? I didn't even realize

18:54

that these were , you know , 12

18:56

foot , 10 foot ceilings . They weren't eight , they weren't not

18:58

. You know , I didn't realize that . You're right , let

19:01

me give you some more money , right ? We

19:03

add in into our contract

19:05

verbiage with our subs the ability

19:07

to negotiate

19:09

some of the pricing if it makes sense , right

19:12

? So we're not . That's that's that place

19:14

that a lot of people say , that we're in it to try and take advantage

19:17

of people and we're trying to give people the lowest cost

19:19

to be able to get the work done . That's

19:21

not how this thing is set up .

19:23

Well , and that example right . There is

19:25

such a great reason to use subs

19:27

because if I tell my painter

19:29

, hey , $5,000 , get this

19:31

job done , here's your work order . They show up and they

19:33

look at it and they say , clark

19:35

, you underestimated this man . Like I need

19:37

eight minimum , probably closer

19:39

to 10 . Let me tell you why . There's holes in the walls

19:41

. There are 12 foot ceilings , like you know , it's

19:44

a vaulted living room that

19:46

they go through the list At that time as

19:48

a sub telling me that I say , oh man , I

19:51

estimated this off pictures . I didn't even walk that . You're so

19:54

right , like I miss this . I'm gonna go

19:56

back to my client and say , hey , listen , this estimate

19:58

was built off X , y and Z . I miss this

20:00

. I'm gonna need to . I need to do

20:02

a changer before we even get started and revise this

20:04

estimate . If you don't wanna go with us , I get it , but

20:06

I need actually X and X . Here's what we found on site

20:08

that's gonna make the variance and so I can

20:11

catch my mistake . It might

20:13

hurt me to lose that job , but

20:15

I'd rather that client say okay , well

20:17

then it's priced too high and let's not do it , than

20:19

me to say yes and have to pay my

20:21

sub $10,000 when I'm charging

20:24

eight right . So I'm gonna lose $2,000

20:26

on top of not making money on the job . So the

20:29

client or the subcontractor helps me catch

20:31

that . First off , second off if they're

20:33

W2 labor and it's

20:35

gonna cost me eight grand worth of labor to

20:37

get this job done . I don't know that

20:39

till after the job's done , because they showed

20:41

up on Monday because this is the job they're painting and

20:43

my bid was for $8,000

20:46

.

20:46

Why would they report back anything ?

20:47

No , they're just there to do the job . Okay

20:50

, I got two weeks to do it , all right , I guess I'll get started

20:52

. Then the labor guys

20:54

just do the labor that you had them do , and

20:56

so you are reactive

20:58

to the profit after the fact

21:00

. You don't know if you're gonna make profit on those

21:02

jobs until after you're done

21:04

and all the receipts come in and I can

21:06

now look at it . So all of my

21:09

knowledge of , and control of

21:11

, profitability goes out the window with

21:13

W2 , because I think he

21:15

could get it done in three days . What do you think right

21:17

? And so the risk is on me . If he doesn't

21:19

get it done in three days , as opposed

21:21

to as a sub , I say , hey , I have three

21:23

days budget for this , so I'm paying you $1,000

21:26

. Can you get this done ? And they say , yes

21:28

, I can do this in three days for $1,000 , great

21:30

contract signed , you're good to go , let's

21:32

go . I know for sure . I'm paying

21:35

them $1,000 to get that done and

21:37

my profit on the job is set . If

21:39

there's anything outside of the scope that they want done

21:41

, they're gonna ask me for them . I can charge

21:43

the client more , but I am in full control of

21:45

my profits , not the labor

21:47

guys out there doing the work .

21:49

And then I also have the opportunity , on day two

21:51

or three , calling up the guy and say hey

21:53

, I've got another one , can you start tomorrow

21:55

or Friday , because I've got another one for $3,000

21:58

. Yeah , I can do it . And

22:00

so you're helping keep them motivated , like you

22:02

were saying , having two week worth of pipeline but

22:04

being able to say I've got back

22:06

to back work for you , where you're not

22:08

having to estimate , you're not having to walk jobs and figure

22:10

things out , you just show up and execute the work .

22:13

So this transition that we've done with a

22:15

lot of companies that we

22:17

coach with . If you want to talk to someone who's

22:19

done this , we will give you the phone numbers . We don't have

22:22

a single person regretting this changeover who's

22:24

in our coaching system . That being

22:26

said , the first thing you need to do is

22:28

not go and have a meeting with all

22:30

of your W2s and say , hey , we're firing all

22:32

of you guys . If you want to be subs , you can . That's

22:35

not what we do . We want to take care

22:37

of our guys . So what we start with is looking

22:39

at them and trying to team them up into groups . We

22:41

say , ok , listen , you're good at painting , you're

22:44

my best drywall installer we got

22:46

. Why don't we put you guys on a crew together ? Why don't we

22:48

put a demo guy with you in a handyman ? And

22:50

we start trying to find the leaders that want to start

22:52

their own companies , that can

22:54

take on starting an LLC , and

22:57

we already know those guys . Those are our

22:59

crew leader leads that are killing

23:01

it . That guy's going to make a lot of money . I

23:03

want him to start . I'm going to help him build his company

23:05

. We're going to have a game plan on

23:07

launching that . We're going to have a switchover day

23:09

. I'm going to help them understand how to get insurance

23:12

and what that means and liability . I

23:14

am going to coach them on starting their own

23:16

little subcontracting company

23:18

to where I can help them grow to

23:20

the next level underneath us and

23:22

be more valuable to us and make themselves

23:25

more money . I would rather pay more money

23:27

to a sub and know

23:29

that I'm making X amount of dollars

23:31

from a homeowner than have on

23:34

staff guys do it for cheaper and make a little

23:36

more money on the job , because I would much

23:38

rather guarantee that I'm making the profit

23:41

than gamble and hope that I bid it

23:43

enough and we'll see after the fact .

23:44

Yep , yep .

23:46

So yeah , that's

23:48

kind of the layout of why we want to

23:50

transition and do that . One

23:52

of the things with that as well is , transitioning

23:56

your guys over is one thing that we're just talking

23:58

about . The other is , now that I'm running that way

24:00

, or I'm setting up that way , how do

24:02

I bring in those crews , train

24:05

them to my processes and so

24:07

where they are going to give the product that

24:09

I want and hold them accountable

24:11

, as well as fire them , get rid of them

24:13

? When do I fire it versus when do I train and give

24:15

a second chance to ? So , jared , if you're

24:17

hiring a new 1099 subcontractor

24:20

, it's your first hire of a sub . You're trying to

24:22

get into it . How do you onboard

24:25

them into your company ? As well ? As

24:27

, how do I do the first job , which is

24:29

going to be different than the other jobs we've ?

24:31

done Right . Well , one thing that

24:33

I would say and this has become

24:35

a standard over the years is that no

24:37

sub goes on our job

24:40

site to do any work until they have

24:42

had a meeting with us . They

24:44

understand the processes . We have

24:46

their paperwork , we have their insurance . There's

24:48

a process to this thing . In

24:51

our software there are different

24:53

spots to be able to fill out all the sub

24:55

information , including adding

24:57

in your insurance paperwork and making sure that you have

24:59

your documentation .

25:00

So there's a storage place for that and we give you all of that

25:02

paperwork . If you're in alliance , yeah , in

25:04

the alliance .

25:44

But the very beginning of it is

25:46

a meeting that is kind

25:48

of twofold One

25:50

to kind of spell out who we are , what

25:53

we do , what's the benefit of

25:55

you working for us , why would you want

25:57

to work with us and how is it going to be good

25:59

for you . So we go through and spell

26:01

out how we pay , why

26:03

we pay , what we pay , when we're

26:06

going to pay them , and also

26:08

help them understand the structure of our company

26:10

, of what I'm paying them for , what

26:13

the partnership looks like , what the partnership looks like . So

26:16

there's a meeting to just process

26:19

through that and help them understand that .

26:22

That's also setting the tone with price and

26:24

the different roles on the job . Correct , if

26:27

you ? I always , when I was onboarding

26:29

vendors , I'd sit in the meeting and say listen

26:32

, man , if you like talking with

26:34

the client , if you like putting essence together

26:36

, you're just got the gift of gab

26:38

and enjoy that conversation

26:40

. Being a sub for us is

26:43

not a smart move , because we do that

26:45

part of it . We handle the customer , we handle

26:47

all that . If you want to show

26:49

up , knock out some work , get paid

26:52

and have more work lined up behind it , that

26:54

is how you make a lot of money with this , and so a

26:57

lot of , not a lot . But there are some subs

26:59

that don't fit into our system as

27:01

a sub of ours , because they want full

27:03

control of the estimate process and everything

27:06

else . But in that meeting I'm sitting down saying

27:08

this is how you can make a

27:10

lot of money with us and if

27:12

you like to operate this other way , thanks

27:14

for coming in , but it's not going to work .

27:16

You're not going to make enough money . And

27:18

there's kind of two reasons for that . One , helping

27:20

them understand what that partnership looks like , but

27:23

also understand when they walk

27:25

into a house and say I can do this work for

27:27

my client for $5,000

27:30

, I'm not going to pay you that

27:32

$5,000 . I'm charging my client

27:34

$5,000 . I'm going to

27:36

take 2,000 of that , like the example you gave

27:38

before . I'm going to take 2,000 of that

27:40

for managing this side of the business , making

27:43

sure that it's all taken care of , collecting the money , blah

27:45

, blah , blah blah . I'm going to pay you the $3,000

27:48

to execute the work on site

27:50

.

27:50

Yeah it's like saying hey , when

27:52

they walk in and say , hey , I can do this for $5,000

27:55

, say , yes , you're going to do it for $5,000

27:57

. You're going to pay me $2,000 to

27:59

land the client , manage the money , do

28:01

all the work . That's a week beforehand

28:03

and a week after collecting and you just

28:05

have three days on site . So you're going

28:08

to pay me two grand of that five to manage everything

28:10

outside of that . That's how you need to view it as a vendor

28:13

of ours .

28:13

Yeah , so that's a major piece of it just

28:15

helping them understand that , because if

28:18

they understand that , then when they get work orders

28:20

, they have understanding of what they're being paid

28:22

for and why it makes sense , because a lot of times they're earmarked

28:25

wait , this size house , I charge X

28:27

amount of money for this right . So helping them understand

28:29

on the get-go is very , very important . Secondly

28:32

, we go through our subcontractor agreement and

28:34

that is just like , as we've talked about before , our

28:36

CEA . That spells out the rules of the game . It's

28:39

the exact same thing as well as it

28:41

corresponds with the CEA . So what

28:43

we're asking Client Engagement Agreement yeah . Yeah

28:45

, client Engagement Agreement , the

28:47

subcontractor agreement corresponds

28:50

with that . So what we're talking and asking

28:52

and expecting our subcontractors of how to

28:54

operate and what we want them to do , that

28:57

is the same thing that we're talking to our clients

28:59

about how things are going to operate .

29:00

Yeah , it's a mirror of each other . This

29:02

is what you're going to do . Let's agree to that . This

29:05

is what we commit to do , so let's agree to that

29:07

to the customer . That way , we are all

29:09

on the same page and we're not stuck in the middle holding

29:11

the ball at the end of the job .

29:12

Yeah , so that it spells

29:14

out everything from insurance requirements to

29:16

how you're supposed to address showing up on time

29:18

. Do's and don'ts on job sites . Don't

29:20

park in the Degeum grass or the driveway . Park

29:22

on the street , all of those different things

29:24

. How to purchase materials all

29:28

of the things how to function in

29:30

our business , the way that we ask

29:33

you to operate Right . That is

29:35

, like we said before , helping

29:37

with that . I don't want to lose control

29:39

of the quality of what I'm delivering

29:41

to my client by bringing in some kind of third party

29:44

1099 company . I'm having

29:46

a pre-meeting with them before they've

29:48

even set foot on site to show

29:51

them these are the rules of the game , this is how

29:53

we're going to operate and along

29:55

with that , you're developing a

29:58

rapport with them . One of

30:00

my main goals when I met with every one of those subcontractors

30:03

was to obviously have that conversation

30:06

with them , but also to help them

30:08

understand that they are a part of

30:10

something by working with us . We

30:12

are a business that is going

30:14

this way , and I would do a small

30:16

not a large amount , but a small vision

30:19

casting of this is what

30:21

we're going to be doing and where we're going

30:23

in our company , and we need good quality

30:25

people like you to be a part of that . And

30:27

so if you can operate under these standards

30:30

, you'll be paid well , you'll be paid on time , and

30:32

we're going to grow , and if we are growing

30:34

, you're going to grow too , and

30:36

so that little bit of vision casting gets

30:38

them on board with operating

30:41

in this way , understanding the way things

30:43

are getting paid . That is how we

30:45

set people up , our vendors up

30:47

to be successful in our business

30:49

and maintain the level

30:51

of control and quality that we

30:53

want on our job sites .

30:54

Well , and my job as the project manager

30:56

is to get them paid as much as

30:58

possible , because the work order system

31:01

and how the

31:03

whole project management system runs

31:05

is I'm going to make a certain

31:07

amount of money on every dollar that

31:09

I'm paying out , and so every dollar

31:11

I can get you , I'm making a dollar 50 on it . So

31:14

if I can get you to do more

31:16

work and more money and expedite that

31:18

to where you understand how to exit a job quickly

31:20

, how to not have go back work or level

31:23

of quality that we expect for what we're paying all

31:25

of that stuff and I can coach you on that you're

31:27

going to make a ton of money and if you're making a ton of money

31:29

. I'm making a ton of money , so

31:32

let me help you grow your company

31:34

and learn these things to where

31:36

you can make as much money off me

31:38

as possible , because then we're all making

31:40

money .

31:42

Another thing that is a helpful

31:45

way of training

31:48

, developing , cultivating your vendors

31:50

and also being

31:52

really good and beneficial for just information

31:54

and paperwork in your own business is

31:57

once a year . Sometimes

31:59

it's better beginning of the year . We

32:01

typically would do it on two different days just

32:04

to kind of help all the vendors be able to

32:06

attend if need be . But

32:08

we would have the vendors come in for

32:10

an annual vendor meeting and

32:13

we would have conversations about vision

32:15

casting , what this year looks like . Blah blah

32:17

, blah . Here's some updated paperwork

32:20

. Here's some new changes of things of the way

32:22

we're operating . Hey , we

32:24

don't have your updated insurance , let's make sure to get

32:26

that . And so it's a spot

32:28

that again inviting

32:31

them into our house , into our space , into

32:33

what we're doing as a business , and

32:35

they're not just tools out on a job site who never

32:37

see us anymore , and so at least

32:40

once a year , and some of our trusted

32:42

crews I mean they came to our Christmas parties

32:44

and all of that stuff . So it really

32:46

is the mentality of like these are

32:48

our partners that are a part

32:50

of the vision , of the growth , of the direction of this

32:52

business . I want to dictate that to them and

32:54

help them understand your strategic

32:57

to this play by .

32:58

The rules operate how we want

33:01

and we're rolling , we're going along Now there

33:03

are some legal things that you have

33:05

to make sure that you're not doing to

33:07

classify them as subcontractors . We're

33:09

not going to dive into that , but silly stuff

33:11

like you can't require them to wear your clothes

33:13

and your shirts .

33:14

They can .

33:15

if they want to . I can give out my shirts

33:17

to anyone that wants it and

33:19

if they want to be able to be

33:21

identified when they walk up on a job site so

33:23

the customer knows who they're with , feel

33:25

free to wear whatever you want , but we don't allow you to

33:27

wear other companies swag

33:30

, other shirts that have other company

33:32

names on it or

33:34

logos on it . We've got a full . What

33:37

you have to look like showing up . You

33:39

don't have to wear shirts . We'll give them to you

33:41

.

33:41

I hope you do and they always do , because they're free

33:43

.

33:43

It's free and they don't want to have to walk

33:45

up and explain who they are . They've just got our shirts on . Great

33:47

, that people know that they're with us , that's right

33:49

. There's a bunch of stuff like that where we

33:52

make sure that we are abiding legally

33:54

with a sub , where I'm not owning their

33:56

calendar but I'm giving them work order saying , hey , here's

33:58

another work order , do you have time for it ? Do you have time

34:01

for it ? And maybe they're not taking work

34:03

from other people , that's fine , that's up to them , that's

34:05

their call . They can work for anybody else that they want

34:07

, but I am sending them work orders

34:10

with start and finish dates that

34:12

are part of the agreement on

34:14

the work order for the amount of work that needs to

34:16

get done , right , right , so

34:18

we've on board them through that

34:20

meeting . We've had that conversation , jared , how

34:23

does the first job with the new

34:25

crew run differently than

34:27

the fifth job with that new crew ?

34:29

So the way that I always worked with that is

34:31

I needed them to have clear

34:34

understanding of the work order system . We use a

34:36

work order system for all of our vendors . They

34:38

always have a PDF , either

34:41

on their phone or printed out . That

34:43

is the marching orders . Here's the address

34:45

, here's the project manager , project manager phone

34:47

number . All of the things that I want you to

34:49

get done , the start and finish dates and then how

34:51

much money we're going to pay to get this done

34:54

.

34:54

And in the ProStruct360 software , after

34:56

you write your estimate , you click on the line items

34:58

that you want them to do and you hit schedule

35:01

. You pick the dates and it creates them and

35:03

it emails them that PDF and it's now

35:05

stored in there and you can start marking things . It's

35:07

super simple to manage

35:09

all of that in the software . Yeah .

35:11

So , and then I would , because

35:14

a part of our subcontractor paperwork , like I mentioned before

35:16

, talks about if

35:18

this , here's the timeframe , if

35:20

there are disagreements in the dollars or what needs

35:23

to be executed or whatever , here's

35:25

the timeframe that you have to be able to

35:27

talk about that , negotiate that and whatever

35:29

. So I would initiate that on the front

35:31

end . Here's your work order , here's the information . Let's walk

35:34

around this property , and so I would walk

35:36

it with the them and make sure every

35:38

line item was clearly understood

35:40

, what I expect from that . And

35:42

then there's a dollar amount at the bottom Can

35:45

you execute this ? And the amount of time for this

35:48

amount of money . Does that make sense ? Is it fair for

35:50

you ? And it was either a yes or no , right

35:52

? Yep , you know what that sounds great or no

35:54

. I could use a couple extra bucks . Whatever it is

35:56

. I would have that opportunity

35:58

, but then I would also teach them

36:01

. Here's this piece of paper , here's

36:03

all the things that you need to get done . Why don't

36:05

you put it on the kitchen counter ? And when you get

36:07

one done , whoever does it puts an initial

36:10

by it , because if it's a three or four man crew

36:12

maybe my third guy

36:14

was the guy who did change out all the light bulbs or

36:16

whatever it was right . So I would just

36:18

coach them to put initials

36:20

next to each one , so that you don't

36:22

get to the bottom and call me and say everything's done

36:24

and I come out and none of the bulbs are changed

36:26

right . So again , very

36:29

, very beginning . I'm teaching them how

36:31

to view a work order , how it works , what it looks

36:33

like , how to walk a job and make sure

36:35

it's done and how to ensure that that work

36:37

order gets completed all

36:40

the way through . And thoroughly .

36:41

I think one of the biggest catches financially

36:43

is when they just

36:45

start working and then they're like , hey

36:47

, we need more money , we did X , y and Z and

36:49

like what that was on your work order , that was part of the agreement

36:52

, and they don't understand . And so at

36:54

the end of the job they're pissed off and they're not coming back

36:56

because they feel like they got ripped off . So

36:58

what you're saying is exactly right . Where I want

37:00

to . I want to be their

37:02

crew leader day one on their first job . I

37:04

want to walk it and show up and say , all right , jared , come

37:07

with me , here's the work order that you have . I

37:09

want to make sure that this price fits what we're doing

37:11

. So let's walk the job . Let's walk through Okay , here's the paint . Let's

37:13

go walk in and walk these rooms and I'm

37:15

going to be your advocates

37:18

as the crew leader quote unquote

37:20

for the day for your subcontracting

37:23

company . I'm going to walk it with you and say so

37:25

, that's why we came up with this prices . Is

37:27

there anything on here that I've underbid ? Is there anything

37:29

on here that you don't see ? Because I feel like we're pretty solid

37:32

on these numbers , because if it's not

37:34

on here , you're not getting paid for it and

37:36

this is what I expect getting done

37:38

. So I'm taking that extra time on that first one . A lot of

37:40

guys get in trouble by all right , jared

37:42

, you're starting work . Here's your work order . I just email

37:45

it over . There's the address . Go get it done

37:47

. And you don't understand how

37:49

to make yourself money and guard yourself

37:51

on my job site . So I think that front end

37:53

walk , like you're saying , is so important on

37:55

that first job especially . I'm not going to do

37:57

it on every single job , but I'm

38:00

also on that walk . But if I'm

38:02

just hiring you for the first time in the sub , I'm

38:04

able to tell you your knowledge on that walk , like

38:07

if you're asking the right questions

38:09

what type of paint where are we buying ? Do

38:11

I need to patch the walls ? What level patch

38:14

sheetrock ? What level of drywall do

38:16

you want done ? When we're doing it in that one , whatever

38:18

the questions are , I'm going to

38:20

start getting some knowledge by what questions

38:22

they're asking and not asking to

38:25

either build my confidence or let me know

38:27

. I need to be a helicopter on this

38:29

job and hover over them to make sure that it gets

38:31

done well , and so that's

38:33

part of that as well is getting to know them

38:35

, understanding their real skill level , because

38:38

every vendor tells me that they're 100% good

38:40

at everything and so understanding

38:42

that on that front , walk too as

38:44

well , as I'm going to be there probably

38:46

every single day for that first job that that crew

38:48

is doing , until it's two or three weeks

38:50

in and I feel confident that they're executing

38:53

.

38:53

Well , and one of the things that I also used to do is

38:55

I would ask them and at

38:57

the very beginning I would ask them to do this

39:00

, but also in the purpose of training them to continue

39:02

to do this , would you mind

39:04

? I may or may not be able to get back by the end of the

39:06

day to day . I'd love to come back

39:08

and walk it with you and kind of see the progress and

39:11

see if you've got any questions , but either

39:13

way , would you mind taking pictures

39:15

of the property inside and out and shooting

39:17

those to me at the end of the day ? What

39:19

did you ? What happened ? What's going

39:22

on ? What's the dumpster look like ? What's the outside of the house

39:24

? Now they're realizing

39:26

that he wants pictures

39:28

of this job site at

39:30

the end of the day . So , productivity

39:34

, I need to show that something actually got done

39:36

and also the place can't look like crap

39:38

Because he wants pictures

39:40

at the end of the day . Now , I actually

39:42

needed those pictures because I would input

39:44

them into our software so that I had record

39:46

of here's what happened today , here's what happened

39:48

tomorrow , all of that stuff . Now it doesn't work like

39:50

an exact science . They get to the end of the day and like oh

39:52

boss , I'm sorry , I forgot to take pictures . That

39:55

happens , but it also helps them

39:57

with that mindset of a

39:59

little bit of accountability . They know , at

40:01

the end of the day , that they got to take pictures and

40:03

they can't call me up and say , yeah , we actually built

40:06

a giant giraffe in the middle of the

40:08

thing . You need to pay me for that Now .

40:09

You didn't yeah my goal with that

40:12

and all of the stuff we're talking about is to make them

40:14

money as quickly as possible , to

40:16

show them how much they can make with us , and so

40:18

I'm going to fight hard for that accountability

40:21

to where it's like hey , I see

40:23

that you painted everything , but that one wall would happen

40:25

. Oh , I thought we weren't painting that wall . Oh well , good , I'm

40:27

glad we're catching that . Now Go ahead and paint that Ba-ba-ba

40:30

, as opposed to at the end of the job . They're coming back

40:32

17 times because they didn't do

40:34

it right . I'm able to catch that along

40:36

the way and help them understand what we're looking

40:39

for quality wise , complete

40:41

product wise and

40:43

small bites , as opposed to disaster

40:46

. At the end of the job , I got to fire them and bring someone else in

40:48

to actually redo everything they did . Yeah .

40:50

Well , and again , if you are

40:52

a GC

40:54

or a contractor who is

40:56

going to be running one or two jobs simultaneously

40:58

, and that's the max that you're going to do and you're going to be on

41:00

the job site every single day . Some of these

41:03

things are not necessary , because

41:05

you're going to see that wall that didn't get painted

41:08

yet and you're going to tell them to paint it . But

41:10

again , as you are growing a business

41:12

, you don't have the time to be

41:14

on every job site every single day . There's

41:16

not enough space and time to be able to grow

41:19

the business to the place that you want to get it to . So

41:21

you have to come up with systems

41:23

that create accountability and

41:25

clear communication of the expectations

41:28

. And if you've done that , then

41:30

all you have to do is hold people

41:32

accountable to what they said they were going to

41:35

do and what they agreed to how they were going to operate . Yep

41:37

.

41:37

Omission of certain things and

41:40

lack of training turns

41:42

into your fault . So I say

41:44

that because if I don't

41:46

make it very clear how that

41:48

the day that the cutoff day , right for us

41:51

whatever's done by the end of

41:53

the day Monday , we inspect

41:55

on Tuesday and we cut

41:57

checks on Wednesday and you receive

41:59

the check on Friday . So whatever's done by

42:01

end of the day Monday this week you're going

42:03

to get a check on Friday . Do you understand that ? And they say , yeah

42:05

, that makes sense . So then I am coaching

42:08

them . We've got to get that done so I can pay you . Because if

42:10

it's not done you can get it paid . Because our software

42:12

we make the bad guy and we say I

42:15

mark these line items complete and

42:17

that creates a payment for you in the software

42:19

. So if the pain is 50% done

42:22

, I can market 50% done , complete , and

42:24

that will create a 50%

42:27

payment for what I owe you on this work order

42:29

. That being said , the

42:31

client can see how much I think is

42:33

done . So I can't lie and pay

42:35

you 100% for this paint if we're not 100%

42:38

. So I want to pay

42:40

you all the money I can , but at the same

42:42

time , if it's not done I don't have the ability

42:45

, because then the client's going to get really upset

42:47

because I'm asking them to pay it Right . And so the systematic

42:49

way that we've built this is I'm not

42:52

the bad guy , you understand from

42:54

the get go , before we get started . Clark

42:56

can't just cut a check randomly because

42:58

I need more money to pay rent this week , but

43:01

instead there's this accountability of when

43:03

I get paid and what has to be done . And

43:05

it is my fault because I actually was sick a

43:07

couple of days and I didn't get that work done , so I

43:09

get that he can't pay me for it , right

43:11

? So if I don't say any of that stuff

43:13

beforehand , they're like well , I need that money . Man , I'm

43:16

not showing up Monday until unless I get five

43:18

grand , because I need five grand to pay my rent Right . And

43:20

so then I . The lack of

43:22

communication that I had getting started

43:24

is now hurting them and

43:27

ending our relationship on the back end

43:29

because sorry man , I'm not paying you . It doesn't

43:31

work in their mind .

43:32

Yeah , well , and one thing that I will

43:34

say is that if you find

43:36

yourself paying your guys in front

43:38

of the work that they've done , so that you're paying them

43:41

more money than the work that they've executed

43:43

, you got to quit doing that because it will

43:45

bite you in the butt . Yeah , period , 100%

43:47

of the time , every single time that

43:49

we've and this has happened as our GC

43:52

company has grown and we've had multiple

43:54

project managers and one of the project

43:56

managers , because they have some , you know , discretion

43:59

project managers have discretion to pay guys . Yeah , and they

44:01

got a sob story hey

44:05

, man , this is due , rents due . I don't

44:08

have money . Blah , blah , blah . Can you just pay

44:10

me a little extra this week and I'll make it up

44:12

, right ? Yeah , and you know we've

44:14

had a ton of times that our guys would be like all right

44:16

, I'm going to go ahead and do that , and then that

44:19

same guy ended

44:21

up having to get let go . And then we find

44:23

out , oh crap , well , we've , like , overpaid

44:26

this guy by three grand and the

44:28

work hasn't even done yet .

44:29

Yeah , or I get to the end of the job and there's

44:31

a thousand bucks left to pay him and two weeks left to work

44:33

, yeah , and he's like , well , I can't , I can't get it

44:35

, like I need more money for the next two weeks and he doesn't

44:37

remember the fact that you're paying them .

44:38

In fact , I paid you three grand over here , yeah Well

44:40

.

44:40

I can't finish this unless I get three grand . I can't

44:42

do two weeks with the work .

44:44

for a thousand months it will bite you in the butt every time

44:46

, yeah , every single time . So , rolling around

44:48

to the end of this thing , I think one of the last

44:50

things to talk about is what

44:54

is the difference between when it's time

44:56

to train up and coach a

44:58

crew versus it's time to fire

45:00

them ? Yeah , so what would you say

45:02

about that , clark ?

45:03

This works on both employees

45:05

and vendors . Sure , sure

45:07

, there's more leniency for me on

45:09

a vendor than employee , because employee has

45:11

a handbook and I have full control . Correct

45:13

, and so . A

45:16

great example of the difference if

45:18

an employee shows up late every day , they're

45:20

getting fired , yeah , yeah . If a

45:22

vendor a great example

45:25

is one of our vendors I'm not going to call out , but one

45:28

off tradesmen yeah , just

45:31

him . And sometimes an assistant in the truck

45:33

doing work on our jobs . He's been around for 10

45:35

years with us . Yeah , when

45:37

he says he's going to be there at nine , he will for sure

45:40

be there at nine or 10 . Right

45:42

, like it's never nine on the

45:44

dot . He doesn't show up early . It's going

45:46

to be nine to 10 . I know that

45:48

about him . Yeah , that's how he operates

45:50

. He has the best intentions and is always

45:53

an hour late . He will be there . Yeah

45:55

, he doesn't know show ever . But

45:57

I know this about him so and he does excellent

46:00

quality work . He does quality work but

46:02

at the same time

46:04

, he understands our system . He

46:06

knows how to get paid and he's okay with

46:08

not getting paid when he doesn't do his part Right

46:10

. And so he understands . He gives us a

46:12

good quality product and

46:15

he owns it . If something

46:17

goes wrong , he goes back and fixes it . He's not nickling

46:20

diming . He owns what he does

46:22

, and so he's just not going to show up on

46:24

time . He's not going to show up on time and he's not

46:26

going to hustle . He can take a three-day

46:28

job , turn into five days , but he's fine getting

46:30

paid the same amount that we would have paid him for three days

46:32

because it's a work order system . So

46:34

I know he's going to delay a little bit and

46:37

I know he's going to be an hour late . So

46:40

what I like to do on that , on that guy , if

46:42

there's a homeowner in that property I'm going to say

46:44

hey , bud , can you be there

46:46

at eight o'clock on Monday ?

46:47

Yeah , yeah , I'll be there at eight .

46:49

Great , I tell my client .

46:50

He should be there around nine .

46:52

Might be a little early , might be a little late coming

46:54

, depending on traffic , but expect

46:56

him nine to nine , 30 if he gets

46:58

there at eight . The client's like Whoa , this is amazing

47:01

, thank you , that's great , you're so early . Great , if

47:03

he doesn't , then we're covered right .

47:05

Yeah .

47:05

At the same time he takes a three-day job , turns

47:08

it into five , but is happy getting paid what he's

47:10

getting paid , great . I'm going to budget

47:12

five days for him to do the work , if he

47:14

gets done . I got two blank days before my

47:16

sheet . Right guys come in , no problem , but I'm

47:18

allowing that and I've built that into my schedule

47:21

. So he has the best intentions . He's

47:23

not lying to me about when he's going to be there . He's not

47:25

lying to me that he could get it done in three days . He's

47:28

got great intentions , but I know his flaws

47:30

.

47:30

Well , and another thing about him is that

47:32

if he's not

47:34

going to make it , he'll let us know .

47:36

Yeah .

47:37

Right , if he's . He's not

47:39

going to call us and say he's going to be late , yeah , right

47:41

. But if he's not going to be able to make it , he

47:43

said he was going to be there on a Thursday and he's just not

47:45

going to make it . He's going to let us know . He's not going to make it on Thursday

47:47

. Yeah , because that is

47:50

a major problem that I'm having with a vendor

47:52

. If I've told my client you're going to be

47:54

there on Thursday and you just

47:56

know show and you don't tell anybody

47:58

about it .

47:58

You're making me a liar .

48:01

We've got a . We've got a conversation of if

48:03

you can't do this , you're not going to be able to work here

48:05

. Yeah , that's right .

48:06

And so there's there's the fireable fences

48:08

which is stealing money , stealing

48:12

clients , purposefully not abiding

48:14

by our subcontractor agreement and working

48:16

outside of that because you want to do it your own way

48:18

, making

48:20

me look like a liar more than once . Those are all right

48:23

. We're done with this guy . We can't , I can't

48:25

, coach him up Right Again

48:27

making me look like a liar if I say he's going

48:29

to be there at nine and shows up at 10 , that makes me look

48:31

like a liar as well . But

48:34

I can have that conversation with them and

48:36

I understand that he's just . He's on

48:38

, you know , caribbean time . He's

48:40

not on , not on . I got to be there right away . He's not on Wall Street time

48:43

, right . And so for us that's

48:45

fine , I could deal with that , as long as I know that

48:47

he's not on Wall Street . I know that about you

48:49

and I'm and I'm going to adjust how I

48:51

manage this guy I'm

48:54

okay with that . But if he's not showing up

48:56

or telling me he's going to be there at nine

48:58

and every day he's always running on time and today

49:00

he shows up two hours late then I do

49:03

look like a liar and I need that communication

49:05

with him and that's that's what's going to end it . So

49:07

really , the fireable stuff

49:09

is when they start holding things hostage

49:11

on our job sites , when they're like , well , I'm not doing anything until

49:13

you pay me X , y and Z and there's no personal

49:16

responsibility , that they

49:18

feel that it's this entitlement attitude

49:20

of , well , you're not this and you're not

49:22

that and it's not a partnership

49:25

. If we can work as a partner and I can

49:27

make sure that you win more than you lose and you try

49:29

to make sure that I win more than I lose , and we can do

49:31

this together .

49:32

This is a good relationship . You're going to be here for 20

49:34

years with this .

49:35

If this , if I got to watch my

49:37

back guard myself , because you're

49:39

always gouging me and 100% of the

49:41

time you win and I lose , because that's

49:44

how you run things , it's not going to work out . We

49:46

need to have a fair and balanced

49:48

relationship to where ? Yeah , I

49:50

understand that . That was , you

49:53

know that kind of is your fault . I'll

49:55

tell you what it's a $200 issue . I'll pay you a

49:57

hundred , you're covered the rest . Let's just get

49:59

it done . Yeah , and they're cool with that ? Great

50:01

, we're going to work together on that and succeed together

50:03

. So it's really the attitude behind

50:06

things . What if they can do

50:08

what they say they're going to do ? And the communication

50:10

. I need that communication . Yeah , absolutely

50:13

. So that is it . There's a lot

50:15

more about subs , but that is our

50:17

declaration of why

50:19

we believe 1099 is better than W2

50:22

. If you think we're 100% wrong

50:24

, we love to hear from you Shoot us an email

50:26

. Go to prostruct360.com , Go

50:29

to the contact us If you want the software

50:31

that we're talking about . It starts at

50:33

free .

50:34

And that's not a free trial . Free dollar bills

50:36

.

50:36

Free forever . We've got a free level that helps you

50:38

build estimates , send invoices , online

50:42

payments , even on that ability

50:45

. On that level , the quotes level

50:47

, we've got to upgrade a level at 89

50:49

bucks a month , which is our light , which includes

50:51

the work orders that we've been talking about , which allows you

50:53

to do the 10 on and on subcontractors and

50:55

all that stuff We've built our software to

50:57

grow with you as a company . So if you're just getting started

51:00

, write estimates for free . If you're trying to now

51:02

hire some vendors , get the work

51:04

orders on the light version to where you can manage

51:06

that Once you start growing . Beyond that , our

51:09

complete version has QuickBooks

51:11

integration . Email integration , where AI

51:13

sourced your emails , reads an incoming email , puts

51:15

it on the right job card . Can't charge document storage

51:18

, everything Customize all your

51:20

estimates and invoices with your logos

51:22

and colors and the softwares white

51:24

labeled so you can make it look like your company

51:26

to where your employees feel like

51:28

it's our software . It's really

51:30

really cool product , really robust

51:32

and very easy to use . It's

51:35

not . You're not having to learn

51:37

a doctorate on software to get

51:39

into this , it's just . This

51:42

is where you write estimates , this is how you do work orders , this is

51:44

how you invoice , this is how you manage your employees and

51:46

we train you and help you grow .

51:47

Yeah , and for what you're getting ? We really feel

51:50

that it's set at a very affordable

51:52

price For sure , for sure . It's not

51:54

going to break the bank and you get a lot for it . Yeah .

51:56

I mean it's compared to other softwares that are $900

51:59

to $1,000 more per month than

52:01

our software is for the exact same

52:03

features . So definitely check it

52:05

out . Thanks for listening . We'll see you guys next week . See

52:07

you .