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How to Build A “Rainy Day” Fund for Your Business (part 1)

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The Nuts and Bolts for Saving Money

 

Last week I wrote about the importance of having a savings, both individually and in business and the high percentage of people who don’t. This tendency to spend everything you have is a problem when the unexpected happens. This isn’t to say that you should put all your money, after paying the bills, in a savings account hoping to retire someday on that savings. What I’m talking about is having money ready for big planned purchases or unexpected emergencies. This way you can use your own money and don’t have to pay someone else to borrow theirs.

Last week I told you about the tool that I use for this, the “Savings Transfer Sheet”. This spreadsheet is easy to use and makes saving simple. What it doesn’t do, is force you save. Maybe I should figure out a way to hook peoples’ deposit tickets up to electricity so that they would get a shock when depositing money without saving.

The biggest problem with saving money is not having a plan to do so. It can be a bit overwhelming trying to figure out how much should be saved when depositing revenue. One of the things that makes it hard is inconsistent amounts. If every day or week you deposited the same exact amount, you could decide once and always put aside a set amount for savings.

It’s rare in business that every job or every customer pays you the same amount every time you do business with them. There are some businesses like lawn mowing, hair cutting, pet boarding, etc. that a preset recurring price has been established, even so the number of recurrences each day or week is going to vary.

The purpose of this spreadsheet is to provide a simple accurate way to know how much money the right amount to save is, regardless of the amount being deposited. The most difficult part is the initial set up. This part requires some research, thought and time.

First – look back through your financial records of the last several years. The more research you do the more accurate your understanding will be of your financial history. Even if you’ve only been in business for a short time it will give you a place to start. This will let you see areas of unexpected expenses as well as dollar amounts.

 

Second – determine what things or areas that need to be saved for. Some examples of what these could be are:

Repairing and/or replacing equipment

Equipment increases or upgrades

Repairing or replacing vehicles

Large building repairs or maintenance items (HVAC, new roof, etc.)

Building or facility upgrades, expansions or purchases

Taxes (income, property, sales, etc.)

Irregular payments (bi-monthly, quarterly, annually, etc.)

Retained earnings (emergency fund because they are going to happen)

 

Third – take the dollar amounts for the different areas that you have determined to be above or outside your normal operating costs and figure the percentage each one is of your net revenue. This will give you a place to start when setting up the “Savings Transfer Sheet” for the first time.

Building a “Rainy Day” savings is critical to the foundation of your business. It is one of the solid cornerstones that will help your business weather the storms of life.

Next week we will go into the “Savings Transfer Sheet” deeper still and see how the information we gathered fits in to it.

 

How to Convert Your Construction Project from Unrealistic to Wow

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The Importance of Having Realistic Expectations Before the Project Ever Starts

 

One of the most consistent issues that I hear from people who have been involved in construction projects, is disappointment. These displeasures show up in a variety of ways and most often it comes down to unrealistic expectations and less than desired results. This discontentment can come from either customers or contractors and usually the responsibility lies with both.

The solution to this problem also belongs to both.

As a customer you aren’t continuously involved in construction projects. You don’t have the experience and knowledge that construction professionals do. This is not to say that every person or company that claims to be a professional is. It’s important for you to know what you need in a contractor and take the time to find the right one for you and your project.

The excitement that comes with the beginning of a project starts to wain after a while. You just want to have your project, whether it is a big renovation or a small repair, done. You want to get your life back to normal as quickly as possible. Regular life is disrupting enough without a construction project, but to have trades people coming in and out of your home or business periodically and/or unexpectedly wasn’t a part of that initial excitement.

The best way for you to prepare for a construction project is to learn all you can about what is involved, before you start. Even small projects have several pieces that need to be fit together to achieve the desired outcome. This takes knowledge and experience to get these pieces to fit together at the right time and in the right way.

Watching home remodeling programs on television isn’t the best place to learn realistic expectations. Often these programs are more of a problem than a solution. Don’t get me wrong, there is a lot of valuable information that can be gleaned from these shows. The thing you need to realize is that the purpose of these programs is largely to generate viewers not create realistic expectations for your construction project.

This is why it is important to get the right contractor. If a contractor does their job well, all the various pieces will fit together in the way that you wanted. This doesn’t mean that it will be what you initially expected, but rather an informed realistic expectation. What is important for you as the customer to do is to know how to determine if a contractor is the best one for you.

There are several things to consider when looking for a contractor.

  • First and foremost is compatibility. Are they going to be someone that you can work with day in and day out for the duration of the project? This is critical to the outcome.
  • Second is honesty and integrity. Often you can tell this with a few conversations and can confirm it with references.
  • Third is the experience and skill level. How long have they been doing construction and what types of projects have they done previously?

Projects rarely go the way the customer or the contractor think they should or would like, but this doesn’t mean that they need to be disappointing for either. The key is to plan and learn all that you can before you get too far into the process. If you will do this, you will decrease your chances of unrealistic and increase your chances of a wow project in the end.

Building the Best Life, Means It’s Always Under Construction

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My Life Lessons Learned From Almost Forty Years of Building

 

It is amazing to me the similarities of building a quality structure and an excellent life. The longer I do it, the more amazing it becomes. These parallels have been in place since the beginning of time. When God made the world these building principles were used. These time-tested practices work for physical buildings as well as great lives.

At an early age we begin the process of planning our lives. We have an image of how our life is going to look, what we are going to do, who is going to enjoy it with us, etc. Sometimes those plans are well thought out and designed. They come with pages and pages of blueprints including all types of details, complete with engineering calculations. Some plans are more the ‘scribbled on a piece of scrap paper idea’. Either way we have that picture of what we think our life should be.

It is important to note that we have access to the ‘Master Architect’. He offers this design service at no cost, it has already been paid for. If we will take advantage of this offer, we will end up with the best finished project.

Like building, the better the plans are before we start, the less problems we will have during construction. This doesn’t mean that it can’t be built without plans, it just means there may be more change orders needed.

A solid foundation is the next thing in the process. A good foundation is what supports the building and keeps it straight and standing tall. The better the foundation the better it weathers storms. This doesn’t mean that some storms won’t come along and knock it down. Even if a storm scatters our lives, a good foundation will still be there to rebuild on.

Once we complete the construction of a building, it doesn’t mean that we’re finished. Nothing in this life is permanent. Everything wears out or deteriorates over time. If we use better quality building material it will last longer, but everything needs maintenance. Often people neglect this part more than any. It is easy to get in a rut and forget to periodically do a checkup, whether it is a building or a life. We need to be good stewards of what we have been given. If we intentionally keep working on it, it will be better in the end.

Remodeling and additions are common in construction. We come across something new that will be an improvement, or there is a change in our circumstances. These things are true for our lives as well. If we aren’t working to improve then we are deteriorating.

 

A message from the Master Architect’s Blueprint –

…but you are citizens together with God’s holy people. You belong to God’s family. 20 You believers are like a building that God owns. That building was built on the foundation that the apostles and prophets prepared. Christ Jesus himself is the most important stone in that building. 21 The whole building is joined together in Christ, and he makes it grow and become a holy temple in the Lord. 22 And in Christ you are being built together with his other people. You are being made into a place where God lives through the Spirit.

Ephesians 2:19-22

 

Let us know if you need help finding solutions for building your dream life.

Building Your Business Is Critical to The Survival of The Business

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Just Like the Construction of a Building – You Need a Blueprint for Your Company

 

If you own your business and aren’t being intentional about the organizational operation of your company, it is likely that you won’t make it past your 5th year. This is according to the Bureau of Labor Statistics https://www.bls.gov/bdm/entrepreneurship/bdm_chart3.htm. Just think about the number of businesses that you have seen come and go.

Whether you are a solopreneur or you have a team. It doesn’t matter if you have been in business for 30 years or just starting out. Regardless of the kind of work you do, the organizational plan is just as important as the work you do…maybe more.

I know in my 40 years of being in business I have learned some lessons the hard way. Let me tell you, the tuition for ‘The School of Hard Knocks’ is expensive. There were times when I got behind on taxes to pay bills and times that I got behind on bills so that I could pay taxes. Neither of these is a very good business plan. One of my SHK professors once told me, “that when you steal from Peter to pay Paul, you make Peter a Paul bearer”. If you want to avoid the need for a pallbearer for your business…you need a plan.

It is common for people to start a business without a plan. Generally, someone has learned a trade or a craft and for whatever reason they decide to go into business on their own. Most of the time they have given little, if any, thought to business structure. They show up every day working hard and then…surprise, you owe some taxes and haven’t saved any money to pay them. They needed a plan, a blueprint for building the business.

Being in the construction business I see a lot of similarities in constructing a sound building and a constructing profitable business.

  • Both need to start with design plans – the thing that gives you a clear direction of what you want the outcome to be.
  • Both need an architect – the person that can see the vision of what the finished product will be.
  • Both need a good solid foundation – the thing that will support you when the storms come.
  • Both need good framework – the thing that holds everything together.

     

  • Both need a builder – the person that reads and understands the plans and puts all the different pieces together correctly.
  • Both need the proper tools – these are what allow the pieces to be shaped and fastened together in the right places in the right order.
  • Both need a good team – these are the different people with the different skills and knowledge needed.

It doesn’t matter if you have been in business for years or are just starting, YOU NEED A PLAN. If you would like to minimize the time you spend attending ‘The School of Hard Knocks’, then keep following our blog. We are working on some Business Building Solutions for just this purpose.

 

What areas of building your business would some ‘higher education’ be helpful.

Building the Life of Your Dreams and Loving It

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A Builder’s Valentine Message

 

I love my vocation. The purpose for which we have been created, is so much more than a job. I love waking up every morning and knowing there are countless possibilities and opportunities to help people build their dreams. I mean I really love my life. Is it perfect? No, not by a long shot. Are there bad days? Sure. But perfection isn’t a requirement for loving the chance to fulfill your purpose.

I thought this topic was appropriate since I am writing this on Valentine’s Day. The day most associated with love.

What is love? Webster’s Dictionary defines love as –

 

A feeling of strong attachment induced by that which delights or commands admiration; preeminent kindness or devotion to another... or especially, devoted attachment to, or tender or passionate affection for… or affection; kind feeling; friendship; strong liking or desire; fondness; good will;…

This is a pretty good description of how I feel about my life, but I like what the www.bible-truth.org site says even better. Love is a “purposeful commitment to sacrificial action for another.” I think this is what we should all be about as we interact in our daily lives.

Last year I shared my core values in “Using Core Values as My Life Filter” and in that post, I said I would go deeper into each of them. A few weeks ago, I started that when I wrote about “Intentional action” in “Getting Back to the Core“. In that post I said that the next core value that I would write about was “Finding and maintaining the balance in everything”. Well guess what, that’s not what this is about.

Since this is Valentine’s Day I felt that “Honor God in all that I do” was a more fitting topic.

I believe that everything we have or do, belongs to and comes from God. In that case, it is only right that I HONOR HIM by showing my appreciation, by giving Him the credit for my life. By loving Him.

As a builder I really connect with God as a designer/builder. He has drawn a blueprint for each and every one of us. He has made all of those plans different. Some may be similar, but every single one is unique. It is our job to learn to read our own blueprints and start swinging the hammer and driving the nails to build who we were designed to be.

I have been reading Shauna Niequist’s book, “Present Over Perfect” and she points out that the “…God of the universe planted deep inside of each of us a set of loves and dreams and idiosyncrasies and we can ignore them as long as we want, but they will at some point start yelling. Worse than that, if you ignore them long enough they will go silent and that’s the real tragedy.” Don’t ignore your blueprint.

Look for and find your blueprint and start building your dream life. There is no better way to Honor God than this.

How Do You Feel About Windows?

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Considerations When Choosing Windows

 

Windows play a big part of how we feel about buildings. They serve a variety of purposes. Determining what needs and/or wants you are looking to satisfy, will affect your decisions about windows.

Window purposes to consider:

            Letting in light – Without windows it is dark inside. Even with artificial electric light, the absence of natural light can be dark and 9477331897_d9266bbf18_odepressing. Even when it’s cloudy outside the natural light will brighten and energizes us. We aren’t intended to be cave dwellers. We need natural light both physically and emotionally.

            Letting in fresh air – Just like the light we need fresh air. In an effort to be more efficient with resources we have continued to make buildings more air tight. It is important to control this as much as we can. However, the tighter we make buildings the more stagnant the air inside becomes. If we can open some windows and let the air circulate when the weather allows…it’s like a ‘breath of fresh air’.

            Keeping out bad weather – Not only are windows used to let things in (light and fresh air) they should also keep things out. This includes hot, cold, rain and pests. To achieve this, they need to be able to be opened and closed easily, have good seals, good glass and functional screens.

            Architectural beauty – Windows can add a lot to the appearance of a building. Both from the inside and from the outside. There is a large variety of sizes, shapes, materials and designs to choose from. Location and configuration also has an impact on how the building looks.27769616255_ab582ab08e_o

            Escape – Although this may not be one of the first reasons considered in choosing windows it is a critical one. Imagine getting trapped in a building with only walls, one door and no other way out. Having windows that allow for egress is a really good plan.

When I was a kid I used to have a reoccurring dream. In this dream there was a concrete block room, standing isolated in the country. It had no top, no doors and no windows. There was a ladder fastened to one of the walls that went up and over and down the other side. I would get inside this room and then a giant mallard duck would show up and circle around overhead (this might be a conversation I should have with a doctor while lying on a couch) …I digress. When I would try to get out the duck would dive down close to the top of the walls. I still remember how it felt, the feeling of being trapped in this room with no way out. I sure wish that there had been a nice Pella window in one of those walls, one with shades between the panes of glass. This would have made me feel better.

Our feelings will be included when making a decision, whether we realize it or not. This is not to say that feelings are the only thing, just a part of the process. Feelings are powerful and can have a lasting effect on us.

Don’t be afraid of your feelings, include them when considering your decisions.

The Importance of Good Communication

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It Should Be Focused On Helping the Customer Realize THEIR Dream

 

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Over the last few days I have been reminded of how important good communication is. There are two separate instances that have come to my attention that confirm this. One situation is of an individual who had been given a price for a project and then after they were already started doing their part (pouring the concrete) found out the price for the building was more than expected. The second was someone who had a project done with no agreement in writing. Once the project was almost completed there were some quality issues. This left them (both the customer and the contractor) in a place where they felt cheated. The contractor billed for work done and wasn’t getting paid. The customer felt that the work is below standard and couldn’t get the contractor to come back and fix it. As is usually the case there are several extenuating circumstances in both of these situations and both sides had legitimate viewpoints. Both projects could have had less problems if there had been clearer communication in the beginning.

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Writing a Blog…What the Heck Am I Thinking?

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Helping You with SOLUTION BUILDING

 

Having spent most of my adult life working in the construction industry I have experienced the difficulties and struggles that come with it. I’ve seen unhappy customers and contractors who didn’t understand why. I’ve seen way too many building projects run over budget or behind schedule. I’ve seen contractors scrambling to make ends meet and customers who think everything costs too much.

It doesn’t have to be this way. I think that building a home, a business or a life, are like construction. You need to determine what you want and why you want it. Start with a good design. Have a blueprint and know how to read it. Make sure that you have a good foundation. Be flexible and willing to accept changes as they come along. Understand that there are going to be problems and be prepared to deal with them. If you can be clear about the goals in the beginning and work with a good team, you can build something great.

This is my hope for this blog site.

By nature I am a planner and a thinker. I’m always thinking and then talking about what I’m thinking. This is how I process my thoughts. I think out loud. This blog is a place for me to do that. It will give me the opportunity to get feedback from you as well. It will be like virtual brainstorming. This sharing should help all of us build better.

I’m going to write with two separate, but intertwined, focuses. One for the building industry and one for the building customer. There will be things that we can all learn from both. The goal is that all of these will lead to building better. I plan to post two new blogs weekly, one for each focus. In addition to these two there will be a third topic mixed in periodically. It will be more random, with a foundational life lesson built in.

The business blog will share business systems, business ideas, personal experiences, construction lessons, etc.:

 

  • Sales and Marketing
    • Proposals and contracts
    • Customer relations
  • Production and Operations
    • Communication documents and systems
    • Production documents
  • Administration and Finance
    • Contracts and change orders
    • Cash flow
    • Invoicing
    • Bill paying
  • New and different ways of operating a business
  • Examples of things that worked and things that didn’t
  • Discussion of specific products and applications

 

The customer blog will focus on looking for and finding solutions for building projects by sharing how to work with contractors, construction ideas, personal experiences, product education, etc.:

 

  • What to expect from a contractor
  • Improved communication
  • Project budgets
  • Realistic project timelines
  • Products and how they work (or don’t)

 

For years I have been asked by other contractors and customers, how I do this or why I do that or what I think the best way is to do something. I’m always glad to answer these questions, but there is a limit to how much I can do this and still operate a construction company. My hope is that this blog site will allow me to share with, and help, a lot more people with SOLUTION BUILDING.

Six Ways to Find Your Right Builder

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I read a study once years ago that ranked building contractors below used car salesmen. This is not to say that all used car salesmen are bad, but they have, over the years had a stigma of…shall we say…not being the most honest and trustworthy. For builders to have been ranked below them was very confusing and a little disturbing. I then realized that I viewed customers differently than a lot of builders. For me they aren’t just customers, a project or just a way to earn money. They are my friends. If you are looking to spend money to have a project done, sometimes a lot of money. Isn’t having a friend who is looking out for you and has your back the best plan? We’ve all heard the stories of the storm chasers that came through town after a hail storm. They get money for material and then never come back to do the work. What about the guy that was laid off from ‘his job’. He has a pickup, a hammer and a skill saw, heck he can build a deck for his buddies cousin. Oh, don’t forget the kid that worked for a contractor for a couple of months and got fired because he wouldn’t show up to work. He’s now an experienced contractor. As a customer you can find a builder that will help you bring your ideas to life and has your best interest at heart. You need to know what to look for so you can find the right fit for you.

  1. Word of mouth – This is the best form of advertising. Find someone that you know and trust that has had a building project done. Ask them who they used. What their experience was like. This will give you a view from someone independent of the industry with nothing to gain.
  2. References – Don’t be afraid to ask builders for references. This is a good way to find a variation of ‘word of mouth’ and in addition to people that you know. A builder should be able to supply you with 3-5 names of past customers that you can follow up with. If not you should proceed with caution.
  3. Professionalism – The level of professionalism will vary between contractors. There is no one specific style or level that should be used in every instance. What you want here is to know that this builder takes what they are doing seriously. There should be something unsettling if you get a hand written estimate on a napkin.
  4. Experience – This comes with time. Not every qualified builder has years and years of experience, but the more years the more experience. You don’t want to hire that ‘experienced contractor’ that was fired for not showing up to work.
  5. Communication – Even small and simple projects require communication. Of course the bigger and more complex the project the more important it is to communicate. In today’s world there are all sorts of ways to do this. The specifics of how aren’t as important as the doing it is.
  6. Compatibility – This is the bottom line when it comes to determining who to use. Depending on what is important to you, what your focus is for your project. Find a builder that shares those core values. Each and every one of us is different. Take the time to get informed and find the best fit for you.