CONSERVATIVE FINANCIALS
Williams started his company when he was in college majoring in business administration. He created a business plan as a class assignment. “It forced me to follow the basics of what all business should do,” he says. “I created a mission statement and belief statement that has helped me throughout the years.”
Davis says that for CG&S Design-Build, one of the greatest contributors to the company’s longevity has been its financially conservative approach, which started with the founder, her father, Clarence Guerrero. “He always said, ‘Cash flow is king,’” she says. He did not believe in buying on credit. “We have a line of credit now, but we try not to use it.”
Third-generation remodeler Trent Haston of Andrew Roby Inc., in Charlotte, N.C., says that he and his brother inherited a similar debt-free attitude from their father and grandfather. “They built the business exponentially slower because they did not take on debt.” However, he says, to hire the talented people to take the business to the next level will require an increase in overhead, which he is willing to do.
Russell says that conservative, controlled growth from year to year has helped Westhill Design/Build succeed. “We tried not to get caught up in the euphoria of a boom time and overgrow. Our growth steadily goes up over 35 years. It’s not at a high rate. Some would say that is not fast enough, but you need patience and to let your capital grow with your training and ability,” he says.
This type of growth also helps with work/life balance. “I would have burned out with big growth spurts — with having too much to do or tripling my workforce,” Russell says.
DIVERSIFICATION
Remodelers should review all opportunities in their local market, Reilly advises. “Be creative. Try to look at the big picture to see what is not being done. Find new ways to increase marketshare,” he says. Though his company offers design/build services, it also builds projects designed by architects and designs projects for other contractors. Reilly recently added weatherization services to help homeowners improve energy efficiency, and he became a Leadership in Energy and Environmental Design (LEED) Accredited Professional to learn about green remodeling.
Davis says that her company offers everything from concept to production under one roof. Over the years, CG&S Design-Build has also added landscape design and installation to its range of services.
Commercial work has helped Williams’ company to survive in down times. However, he says that it’s important to try different markets, even if, ultimately, they are not a good fit. He has tried and rejected structural repair work, gutter installation, in-house electrical work, concrete resurfacing, and insurance restoration.
For Russell, diversification has helped the company ride out market fluctuations. Besides remodeling, he also does home maintenance, aging-in-place upgrades, and commercial work. “This broad scope is absolutely necessary,” he says. But, he cautions, “We took the time to set up each division and we have grown into them.”