How to Build a Construction Business That Can Actually Grow (Ep 284)

Do you think it might be time to expand your business? 📈

Today, Max talks about how—and when—to start expanding your business. 🎙️

It’s rarely a lightbulb moment 💡 when you should start expanding, but there are signs you might not be aware of. 👀

Catch today's episode on the whiteboard --> https://www.youtube.com/playlist?list=PL76rc3DrCOMb7VM9icAOQmLodNCSZTfKf

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📧 Email: paris@jobtread.com
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Transcript

SPEAKER_00 0:00

Is your day-to-day in your business burying you to the point where you can never even think about expanding a business? Today, I want to show you on how and when to expand your construction business. Enjoy. How old are you going to be before you start to experience life like you want it? I want to tell you right now, whether you like it or not, there is a better way to do business. Hi everyone, welcome to the Business for Builders podcast. My name's Max. I'm your host, humble general contractor, and business owner, and business coach. So great to have you in the house. I appreciate the fact that you've stopped by. I trust that you can tuck something under your arm as usual and uh make your business better. Because remember, we're all about developing and building a high performance, highly profitable, kick-ass business. Right, bit of housekeeping, like and subscribe, all that kind of good stuff. Hit me on email if you've got any questions. Max at elitebusinessadvisory.com. You can find out a little bit more about what I do with general contractors on uh elitebusinessadvisory.com webpage. Uh, you know, if you want to chat with me for 30 minutes, complimentary, okay, um, hit the yellow button on that website, find a time that suits you best, make sure you identify the time zones because we're LA time here on the West Coast, and uh just you know, grab a time and we'll just sit down and chat about what you're doing well and maybe what you're not doing well, and then we can uh maybe help you uh you know get a little bit of a custom insight into what you're doing and um go from there. So, right today we're gonna talk about because I know that a lot of guys say to me, Max, I want to build a business, and I say why, and they go, because I want to make more money, and so and that's a cool goal, but that's a conversation all on its own because really we want to make sure that we understand what we're signing up for. Um, but when and how to to expand a construction business, I guess is uh is something that eludes most builders because, like at my age, I'm 54, so I'm old and washed up, uh, but still kicking. Um, you know, at this age, I think we've been, and I say we because I'm referring to sort of you know the guys in my of my vintage, potentially have spent enough time in the game to just want to crack the shits and get away, but they can't. Why? Because they're kind of chained to the wheel. Um, and so, you know, I think if you're a youngster, you've got a great opportunity. Obviously, technology gives you access and insight uh to much of what's been done before you, and hopefully you can gain some knowledge and uh and some wisdom without going through some of those negative experiences, and that will help you, right? So just understand that wisdom comes from experiences, and normally those experiences are not positive as far as in that here and now moment. But certainly when you look back and you analyze where some of those pitfalls were pitfalls were, it will help you uh as you move your business forward. And that's why what we've got to do as business owners is always have the mindset that says, I'm not gonna get this right first time around, but I'm going to fail forward. Am I a perfect father? Absolutely not. Am I a perfect husband? Absolutely not. But what we try and do is be better today or tomorrow than what we were yesterday, based on being honest with ourselves. Okay, so uh let's get our heads straight first and then uh let's go and execute. So today I just want to chat real quick about what we can do or what do maybe my my view of when and how to grow or expand a construction business. So let's get after it, right? So I've gone ahead and just put these on the board here because I just don't want to waste time writing on the board. I want you guys to sort of be able to sort of get it inside your head and understand what we're about. So the when is not it's not obvious, okay? It you don't just wake up and go, right, today is when I'm going to expand the business. I think it's a gradual thing, and I think what happens is you look at what the business is currently doing, and then you start making calculations as to where you want to go. So the when is not necessarily a very black and white moment in time. I think the when can be an all an ever-evolving moment, but there is definitely specific times when you're gonna make a run for it. Let's just say that. Right, so expansion really rarely feels clear, okay? Uh normally it shows up under pressure, um, where there's capacity limits and potentially where there's missed opportunities. So, you know, this is not something where you go, well, I'm gonna feel positive about my business, and so I'm gonna expand, I'm gonna grow my business. What I've just outlined there is, you know, capacity limits, missed opportunities. And so they could be the red flags where it starts the thought process around what is the infrastructure that I need to ensure that we we aren't working at our limit where a lot of mistakes can be made, oversights can be made, um, and where we don't miss opportunities because we're so overwhelmed with quotes, let's say, that we just people just don't wait for us. Now, I've just come out the back of the home show a few weeks ago, and I'm telling you it's real. I mean, that that flood of leads where you get 10 to 15 leads, you know, and a good half of them on quotes, you got to run around and do site visits. And you know what I think about as I'm running around doing site visits and um scheduling quotes inside my job tread is that I would hate to have to then go and build this stuff, right? And so, you know, I I think for us, and I say for me and for Jed and I is the best thing that we've got is that we've got two seasoned operators that have been in the game collectively for over 60 years, that have very similar but at the same time very diverse skill sets with a great deal of respect each way, and we find that the momentum that we get out of that and the peace of mind that we get out of that is unbelievable. Now, are we splitting checks? Yes, we are. Some guys would say I would rather have all of a grape than half of a watermelon. You know, if Jed and I can build a$3 million business in two years, based on our experience and everything we we know collectively, and and yet you're struggling, you say, Well, I don't want to split a track, split a check, but you hit your capacity limit at a million because you're doing all the quoting and estimating in business administration, contract administration, and you've got to go and then supervise the work. You can see how that there's not enough hours in the day, which means why you start quoting at night and therefore you don't see your family and all of that negative stuff, but you're like, Well, I'm I want all of my great mate, and I just think that's you know, I think that's a little bit naive, that's all I would say. Because remember, what I'm about from an elite business advisory business coaching standpoint is more profit. Yes, I need expansion capital, but better lifestyle, guys. It makes no sense to me when I'm whipping myself, right, and let's say making more money, but I'm not actually creating a better lifestyle. Something to think about. Uh right, so early signals to consider growth. This is something to think about. Uh, consistent lead flow and operational strain. So for me and Jed, knowing that I handle everything, let's say off-site, right from sales, let's say from the first contact, right through the contract and the operations of the business, both in the pre-construction phase and the construction phase as it relates to financials. Um, what we do, not necessarily to expand the business, but to ensure that you know there's no operational strain. I start to program my year, you know, and a lot of the time we will program a year based on okay, here is where we are. So we always look forward 12 months, whether it's at January 1 or whether it's you know April 1, doesn't make any difference. So we're always projecting what are we getting done in the next 12 months, and then we start putting our project start schedule together to make sure that we don't actually had a meeting with a client yesterday, and uh they were very adamant that they had to be done by August 31st because they're they're going to Australia, you know, uh in September. And so, you know, for me, I did an immediate calculation and and you know, just I guess what I preach all the time is that we did the first phone call, I didn't talk about money. When I left the left the meeting yesterday, it was I like the clients, I like the job, and we got to talk about money, but I had to quickly do the calculation to say, well, it's gonna be a month in pre-construction, it's gonna be a month in uh, it's gonna be uh a month in the city to get approval, and it's gonna take us about three months to build. They're all very generous like allowances. That ends up being five months. Now that meeting took place on April 1. So do the math April, May, June, July, August. So I said to her, you know, when you when we talk about in sales to create urgency because you want to figure out who are the players and pretenders, um, you know, in in she did that for me. She's like, I've got to get on a plane, I want this finished by August 30th. So I did the math and I said, Well, if we dilly-dally, then it's not gonna work out for her and getting finished. So, you know, operational strain is a good indicator. So you've either got to do one or two things, you've got to grow your business, get new more humans, which is a challenge, or you have to uh understand how to that by delaying or deferring start dates can actually be part of your growth. Because if that pro if that project is going to provide some good uh a good amount of uh profit, then that can go into the expansion capital. So essentially, you're creating a good you know bow wave of work that's priced right, and that's gonna give the business nice sustainable growth over the next months and years. Okay, everything to if everything depends on you, you've already likely hit a ceiling, which in itself is like you've either got to be happy at that revenue level you're at when you're hitting your ceiling, or you've got to understand that if I am to increase that ceiling height, I've got to do something around expansion, growth, infrastructure change to accommodate that. Um, and so if you're the guy that's wearing all of the hats, um, you know, my heart goes out to you because that's so you're doing a hell of a job. Because uh I I just it's I think it's too much business for one human. Right, so let's digress slightly. So the next thing here is what's the end goal? You know, we've got to define that. Um, you know, I didn't, I was I was fortunate enough to get an apprenticeship with a fella uh who today is is has done pretty well for himself that most people would look from a business standpoint. Um, he's he's an outstanding performer, there's no question. Um and so did he start out with that in mind to build high-rises on the Gold Coast? I'm not sure. Maybe he did. I've not asked him the question, but I will be in Australia uh myself in September and I will catch up with Phil for a beer. And so maybe that'll be one of the questions that I ask him, mate. When you were building bridges at Sanctuary Cove on the Gold Coast, before you even had a builder's license, as a matter of fact, he employed me as a uh an apprentice in 1989, and he didn't get his builder's license till shortly after that. He was using he was using his dad's. Um, but I don't know in that in that early part of his career, did he have his eyes on being a big builder or did he just want to, you know, make a couple of hundred grand in his pocket per year? I don't know what that was. But for you, the reason why we identify the end game or the end result is so A, we can reverse engineer the steps, and B, when life gets hard and business will get hard, you need to be able to sort of understand why you're doing it. Okay, now if your goal is is out of reach and out of sight, it's not going to do anything for you. You're not gonna be able to hang on to that and say, that's why I'm going through this shit with this supplier, with this subcontractor, with this client, you know. Um, you know, there's a saying, this too shall pass. So anytime you get in a valley where you're having a shit situation, you're eating a shit sandwich and it's not going too well. What I need you to do, it's moments like that where you and I get to go, all right, we can react or we can respond. And I think knowing that, okay, that the end game looks like this, as well as this too shall pass, what we've got to do is just keep putting one foot in front of the other, okay. Um, expansion without without a defined lifestyle outcome just leads to more stress and uh and certainly doesn't provide any freedom. Uh, you've got to decide on what you want the business to give you in the way of time and money or both, okay. Um, and you've got to have a growth plan that aligns with your personal goals. I think that's important because you don't want to go and charge off and build a great business and destroy something in your life that's really important that money can't buy. Okay, so it's not just revenue targets. Revenue targets are a vanity metric, right? I don't hang my hat on that and go, yay, we did five million. Okay, but what I what you have to do is you have to have a revenue target because everything comes out of the revenue target as far as what activity do I need to see or do each day, each week, each month to achieve that revenue target. So the revenue target is just an outcome, it's a target. Um, and then everything that we do in the way of activity in the business is going to be shooting towards that target. Hope that makes sense to you. Right, number three. We've got, you know, I really want to ask you what lens are you looking through? Okay, now you know I'm all about, you know, ideas of shit, execution's the game, but I'm saying before execution, what are we analyzing our business and our life and our leadership capacity and capabilities with? Okay, I think what we've got to look at if we're looking to expand the lens that we have to look through. So when we're in our analysis phase, okay, and so with analysis, you can get the paralysis of analysis because you go, wow, there's so much stuff to look at. I don't really know what I'm supposed to be doing. Get a coach. Because someone like me can look at your numbers and not be emotionally wrapped up and just go, bud. A, maybe you're not even putting numbers in, so good luck with that. But me, I like to try and keep my EBA coaching clients accountable because it's hard for us, me and them, to be able to calculate the next 90 days worth of activity and execution unless we can see the previous 90 days, the previous 180 days. Because what we're looking for is what's working, what's not working, what's trending, is the business trending up or is it trending down? Like all of these, all that dashboard is is there not because I need to give you more admin work. The dashboard is there to be able to tell you at a glance what's going on in the business, and certainly to help me help you for sure. Right? Um, and so the the lens that you look through, if it's rose colored, then you're gonna think that you're on the right track, you're gonna think that you're executing properly, but you're not really. And so, again, sometimes, you know, I think with some of my longer-term clients, there's a lot of what we do that's in, you know, when we first start, it's very elementary, it's very primary school, and then the business and the human elevates and they move into secondary school, and then you know, some of my guys are in that tertiary, you know, the beginning of that tertiary situation where you know they've got their they're billing at a rate of between three and six hundred thousand a month, you know, they've got a fair few moving parts, they're dealing with a lot of high value clients, and you know, it's it's a it's it's good to see, and it's it's almost like that success was long time coming in the tertiary field because what they know at the top they learned at the bottom, right, folks? So understand that it's not like well, because Max teaches me that today, um, I'm gonna get it right tomorrow. No, what it just means is when you fall down, you go, oh, that's where that probably fits. I should get used to using that muscle. And oh boy, but it's inconvenient. Okay, right. Um, look at your business through these three lenses to start with, okay? The number of leads that you get, right? Your capacity, both personally and corporately. Okay, so personally means you as a as an individual, are you losing sleep at night? Uh is your quality of your life diminished because the stress on you because of the business? Okay, so that's your ability to handle it's you know, like you get that conveyor belt. Your business is like a conveyor belt coming at you all the time in different parts or portions of the business. And so, is do you have the ability to handle all of the incoming that's coming down the various um conveyor belts and being able to stack that neatly and keep control of that, or is it just piling up and becoming a friggin' hot mess? If you're the hot mess type, then you need to simplify your life. That's what I think about. Whenever I think, boy oh boy, I'm a little bit slammed. I should try and try and handle the flow. So stop the conveyor belt or slow the conveyor belt down. As that shit is coming down the conveyor belt at you, you've got to prioritize which conveyor belt needs your attention the most, and then the others need to either pause or stop. Simple, okay? So this is what we're doing now. We're quickly analyzing, but what is the system, the tool that we can use? So this is always mental. I'm not gonna draw you conveyor belts and shit. I haven't got a document for you. But in my mind, I'm practical. And I'm like, right, I've got all of these things from a business administration side, a client-facing pre-construction side, a client-facing post-construction, excuse me, post-sales, in construction. Um, you know, there's all of these of these relationships that I've got to maintain with both team and also vendors, like subs and suppliers. And so all of these, you know, all the compliance things around your tax department, the demands that they make, the the requirements around, you know, fulfilling your obligations as a business owner, you know, all these sorts of things. It's just like non-stop, non-stop, non-stop. So really, I think when I when I talk about that, and then I think about our situation, and and I think Jed would he would agree or he would he would concur is that the fact that I'm running all of those business conveyor belts, what we've done is we've divide and conquer. So it's like, Jed, you take care of, you know, when we do the handoff between contract and then it starts construction. Here's the handoff, my involvement, I'm your wingman. I do a little bit of procurement, a little bit of scheduling, a little bit of project management behind the scenes to ensure that he gets momentum. At the same time, I'm over here doing business administration, chatting with accountants regularly, making sure the numbers are on track, doing the sales, like I've got my hands full, no question. I mean, Jed will work 40 to 50 hours a week on site, I'll do the same here in the office, okay? So, what else? Leads, capacity, okay? So the amount of leads coming down, your capacity to handle it, and then systems. And so, you know, you've heard me say before that good businesses run off the back of good systems, and good systems are driven by good people, which drives a good business, okay? So, what we're trying to do when we're talking about expansion, really in a nutshell, it's systems and people. Okay, and one of your systems might be how do I recruit people? You know, one of your systems might be how do I get consistent lead gen. If you haven't really got a good definition around those systems, then you're gonna have to work on that. So expansion is not is not on the board right now as far as you're concerned in your business because you've got a few deficits that really need to come up and be analyzed, and then we can execute. And don't expect it to be perfect. You know, you go hire someone, and two weeks later you figure out they're not a fit, and I have a saying it's high quick, fire quick. You always maintain the leverage. If they ask for big bucks because they think they know what they're worth, great, show me. And then in two weeks you go, I don't agree with your evaluation of yourself. Thanks for coming. And just so you know, Jed's the good cop, I'm the bad cop. Okay. The other thing in identifying um, you know, or the lens that you might look through, just to make sure that I'm on track here, yet before execution, um, identify where the bottlenecks, uh, the bottlenecks in your businesses are before adding more workload. So, you know, we really want to make sure that the suspension under the truck is good for one ton before we jump before we drop one ton payload on that vehicle. Okay, so you don't want to drop a big payload on you as the business owner if you haven't got the suspension and everything that's required as far as infrastructure to be able to handle and drive with that load. Okay, basic. You would say, Oh, that's not really life-changing. Well, why aren't you doing it? Why do you take on? Now I'm all about bite off more than you can chew and then chew like a bastard. I get it. Okay, but not if it's destroying you. And that is the qualifier. Okay, like we can all handle a little bit of stress in our lives for a little bit, but at some point in time you will cross a bridge that says, I can't do this anymore. I can't keep doing what I'm doing at this level anymore because I'm not a friggin' robot. Okay. Growth, growth decisions should be based on clarity, not emotion. So when we are evaluating or when we are analyzing our business, it has to be uh it has to be uh non inclusive of any emotion. Okay, and I know if you're like me, I'm a little bit emotional. I can get worked up pretty quick, you know, I can get pretty passionate about things, and when emotions go up, your ability to make decisions goes down. That's why I think most clearly when my eyes first open in the morning and I start, you know, thinking about the business. And I get I'm very objective because at that point I haven't let the day kind of you know beat me up a little bit and piss me off and all that kind of wonderful stuff that goes on in our construction lives. And I've got a high level of clarity. Why? Because there's no emotion. So if you go, Max, but I'm just a, you know, I'm an emotional wreck every minute of every day from the moment I wake up to the moment I go to sleep and beyond, then you you should consider getting some help. Now I don't know whether that's I need to get therapy or whether that's I need a business coach to take my hot mess and try and help me organize that, figure out and triage where we need to, you know, go first. Help me define what it is that I that is important to me. And I'm telling you, in that first 90 days, you and I, if we are to work in some capacity as a business coach and a client, I gotta get that straight because if I don't, you won't go the distance. So then you start falling into that 50% of builders that by year five are either out of the business or they're broke and out of the business. And of the 50% that's left by year 10, they're out of the business or broke and out of the business as well. Okay. So you guys, you need to protect yourself. You know, you need to really put on and have the equipment and the understanding and the clarity. And this is why, guys, I do the coaching on demand. And so if you're watching this and the bells are ringing and you're and some of the message that I'm sharing with you thus far uh is resonating with you, then possibly the coaching on demand is something for you. You'll get one-on-one with me, you'll have 90 days, same price as what you would be if you're doing month-on-month. Okay, and it's a good way to just lean into the business coaching world rather than me going, right, we're going to work on strategic plans and we're going to set goals and what's your PL look like, and what's your current you know, break-even points, and you know, and I've got to do that all very quickly, and that it becomes overwhelming, and I'm like shoving steak down a two-year-old's mouth, and they're not having it. That's maybe one option for you. And certainly, if that's even too much, and maybe you know that kind of investment is not even possible, well, then get across to elite businessadvisory.com forward slash academy. The contractor academy is there's 20, 20, 22 videos, bunch of resources in there, 65 bucks American a month. Look, just start res like figure out what resonates with you. Are you a good student of this business? I didn't ask you if you're a good construction operative or practitioner. I know you're a good carpenter, I know you're a gangster, I get it. You can knock frames up and stand trusses and plumb straight and square. Great. Doesn't make you a great business person. That's where this shit comes in. Got it? So I'll give you tough love, you know, if you want to do the one-on-one. But if it's still too much and you're not sure about yourself and you don't want to commit, then I would encourage you to get across. There's over 20 videos of all of those departments right across your construction business and mine, and there is nine departments plus leadership that are in your business right now that need to have systems. And when we talk about systems, I've got 400 plus SOPs that if you're a full-time client with me, you get access immediately. Okay, if you're a coaching on demand client, you'll get access to that on the second time around. So if you want to know more about that, just hit me up on at uh max at elitebusinessadvisory.com. Get a complimentary, just come and talk to me about it. Get off camera and let's go and have a chat, and then you can figure out what's the next steps. Right, there's a little plug for good old Max to help you. Because if you are too emotional, you've it's just like a blur, you can't analyze it objectively. Okay. Um, so that's that. Number four, leverage. Okay. If you want real growth, you've got to leverage. You've got to use the principle of leverage so that, okay, so here's the deal. If you're wearing all the hats, let's go back to the start. If you're wearing all the hats, your leverage ability, in other words, your ability to leverage inside the business is greatly diminished because why you're doing everything. So, what that means is we've got to go, okay, so what's leverage about? Well, leverage is systems and people. You'll you'll get this eventually, how it all just keeps coming back to the same principles, and you're like, okay, I get the headlines, what I've got to do is dive into the micro. And that's where you and I working together will help you achieve those goals. Okay. So when we're talking about leverage ability, the ability to leverage, I think where it starts is your personal and private leadership, to be honest. Um, you know, as well as your corporate or your professional ability to lead. Because when you're talking about leverageability, it's it's mostly it's for the majority for us in construction, all's ideal with all day as humans. Humans, humans, humans, humans, humans. Okay. And mate, I'll tell you what, it's not pleasant sometimes. Okay. And so we've got to have the capacity as a leader to not, even though we don't agree with that person's attitude or how they throw you under a bus or how they're passive-aggressive, you know, that's where we've got to, you know, and this is why I say to guys, every week when we meet, it's like we've got to, what are you doing well, what's not going well? And I tell you what, I on a weekly basin, uh basin, the weekly basis, the poison, okay, that can come out of a human in one meeting, and off the back of that we talk about, you know, where the gaps are and what we can do better to stop that happening going forward. I tell you, the more we get down the track as far as our business relationship between you and I, and me as your maybe your business development manager, you know, from a fractional point of view, where I'm involved with your business for an hour or so every week, that could be the thing that helps you start checking off a bunch of shit that's just been lingering all for a long time because I don't let go of that. I have the notes from the previous meeting in front of me when I'm taking this meeting with you right now. And the reason I do that is because I'm like, mate, we've been talking about this for weeks. You've been telling me that you're going to adjust and you're going to change and you're going to improve and you're going to, you know, hand off or you're going to sort of delegate, but you're not doing it. And that becomes the bottleneck. So you and I become the bottleneck in our own business, okay? It's not the government, it's not the interest rate, it's not the marketplace, it's not those friggin' clients, it's you, it's me. Okay. Um scaling requires people and systems. That's going to give you leverage. Okay. So, really, what it comes down to is I want to control more but do less. See, if I've got 40 hours and I make I create a million dollar in revenue for the business, or I have a business that does a million dollars, it's almost like, well, if I wanted to be a two million dollar business, now I've got to do 80 hours a week. And then if I want to be, you know, a three million dollar business, then I've got to do 120. Which you know is just is not the case, it's a joke. So, how is it possible? Now, some guys will go and do go from one million to two million, and they'll make less money at two million as far as net profit concerned than they will at one million. And why would that be? And the reason for that is because you do so much at one million by yourself, you keep your overheads down, so your your break-even point is good, your fixed expenses are low. Then what happens is to get that million dollars of revenue, what you do is you take on a lot more overhead, your net profit goes from maybe eight percent down to two percent. Because you've had more operating costs, more fixed expenses. You've given up some of that profit because your pricing model hasn't changed. That's usually where it hits you hard. And so the profitable pricing system, which we won't talk about today, but that changes the way we look at how we price projects. So if you're interested in that, maybe book a meeting and we'll chat about it. And it's really long form, you know, it's not something I can quickly touch on here where you'll get it. I think you'll you'll you should understand it pretty quickly. Um, and it might change the way that you sell and close deals. Okay, so without leverage, um, all the growth's gonna be, like I pointed out, is longer hours, more pressure, and that is not the plan, right? Reality check. Okay, one man band. If that's you, you're not really in a position to grow the business. If you've if you say I want to do everything, and some guys don't, but then their actions don't map to that end result, so essentially your uh you know your credibility is undermined because you say one thing but do another. Doing everything yourself limits both income and lifestyle. Expansion requires letting go, and it's hard, okay? Um, do I think that I'm I I absolutely know that I'm blessed to have a business partner like I've got. Uh, did I do any speci anything special to earn that? No. Essentially got a bit lucky, you know, and it is what it is. Um at this at some point you must choose to stay small or build a company. I had a I had a business mentor ages ago. He said, mate, you either stay at one person or you get to 100 employees as quick as you can. And that just I had no concept. And even today, like obviously, you and I don't need a hundred employees. We might deal with a hundred people, and that's fair. You know, like, do I need a bookkeeper? No, because I outsource it to my my bookkeeper accountant, and of course, all my software links up with QuickBooks, which she she's got access to. Like, there's there's systems, technology that we can leverage on to actually tick a box over here that traditionally would have been done in-house, but now I can outsource that to a reliable source. So I've got a great business partner, a good accountant, you know, all of these things. We're starting to develop that network of trades. We've got great suppliers that really dig deep for us and help us, and those are the components that help us, you know, develop a business. But, you know, if I, you know, for me and Jed wanting to build a bigger company, that's an everyday thing. We hire, we fire, we we engage a sub, no longer a fit, you're gone. You know, supplier I'm dealing with right now, I can't wait to finish this job because I just want them to go away. Just the human inside of that operation is just not it's not how I would have me deal with you with other clients, and it's not how um if I was an employer of that person, I have them deal. There's too much manipulation, too much bullying, things like that. So if if you know that might be okay for someone else to work with, it's not okay for me. It's it goes against my core values, okay? So um, but we do have to, um, we've got to at some point make a decision to build either a small, keep the same company that we've got at that same level, or we've got to go deep. Right, final the final thing here is a word of caution, guys. You know, I two parts to what we do, and some guys do new homes and renaws, some guys just do new homes, some guys just do rena's. I will tell you this, in closing, to renovate, excuse me, to scale up a renovation company, right, is hard, it's slow, it's messy, right? And so when you know that in advance, now I said it's hard, it's not impossible, but you're gonna have to be on the top of your game. Now, ask yourself the question why is it most builders want to go and build new homes? Why? Because there's construction predictability. That that what and that's great, yippy cry A, that then I don't have headaches with renovations and it's a you know pain in the ass because you've got clients trying to live in homes, and like I understand that's why it's hot, messy, and slow. Oh, sorry, hard, messy, and slow ends up being a bit of a hot mess. Hard business to scale. Now, when it's hard, the barrier to entry is high, which means most people aren't going to go over, which means there's opportunity there to grow a business and be a dominant force in your location. So just keep that in mind. The other side is we go new homes, we want to build nice and fresh and new and everything like that. Problem with that is two things happen. One, more competition because it is an easier business model to maintain. And two, pricing becomes a lot more narrow because it is so predictable. Now, you've then got to work harder at demonstrating the value of your building company to a homeowner and why they should pay four or five percent more for the same home for with you instead of going with your competition, who is that five to seven percent uh less expensive? So if you understand those two sides of things, now where it gets ridiculously complicated is where you've got guys doing new homes and renos because you need a set of systems for the for the for the reno, you know, hard, messy, slow, and then you need sort of different systems for new homes. So it's like it's two different business models, two different pricing mechanisms. Okay, your markup needs to be greater inside of Rena's than it is for new homes. You know, can you run a new home business with less overheads? I think you can because the trades can take care of themselves. But if you're doing Rena's where there's a lot more engagement, a lot more questions, a lot more clarification, a lot more paperwork required, that can get hard. Remember? Hard, slow, and messy, right? Um, so it requires patience, adaptability, and resilience. Okay, you need to be patient. It's slow, okay. Um, you're gonna need to be resilient because it's gonna take longer than what you'd like it to. And you're going to need to be able to pivot. You've got to be able to think on the fly, you know. And I've talked about the whole pre-construction thing for years. I've even talked about doing fixed price. I'm a big advocate of fixed price, lump sum contracts, absolutely. We're doing a job right now, smaller job, commercial job, just to put to build a server room for a for a company, and it's it's on time and materials. And the reason is A, it's close to the office so I can supervise it, and B, I'm just not interested in quoting and trying to win a small job. But what I want is I want the client relationship and I want the five-star review. So I'm willing to take a little bit less money on a cost plus basis than I would on a fixed price, but that five-star review potentially, because I won't get a video for that, it's going to help me then build the lump sum side of my business. So I've adapted, I've had to pivot, I had to realize that making$75,000 in sales per year was not going to sustain the business. And then whilst the marketplace was picking up and interest rates were starting to settle down and there was a little bit more confidence coming back into the market, we went and did some cost plus work and then bang, we closed a million-dollar contract. But if you're not in the game and you're not surviving, then you're not going to be around to sign a million-dollar contract. Um, and resilience is obviously a big deal. You know, if you don't, if you don't quit, you'll make it. If you don't quit, you'll win. But guys, you can't keep doing the same thing expecting a different result at the same time. Like resilience isn't doing the same thing and expecting a different result. You know, that adaptability and patience has got to mix with resilience and saying, all right, well, this is clearly not really getting a result, like me, Mr. Let's do fixed price only. I had to pivot whilst the market bounced back, otherwise, I wouldn't survive and be in the right place to pick up the new jobs. Uh, growth is not linear, okay. Expect setbacks and learning curves. So it's not going to be just like straight down the line, A to B. You're it's like this, mate. It's all over. Like I have these ideas, and then we give it a crack and it doesn't work, and so we throw it out, and we know that we've burned four weeks and you know, 10 grand or God knows what. Mate, it's just the way it goes. And if you have this expectation that it should be linear, then you should go and get a job somewhere else. Don't go into business. Get out of business if you're in business and that's your expectation. Okay, super challenging if you have that expectation. All right. Expansion isn't about doing more, it's about becoming more. So don't wish it to be easier, just go get better. Because what you'll find is that you'll slowly develop the muscle mass through resistance and pressure and challenge that you look back and you go, well, 12 months ago I couldn't handle this situation, but right now it's a piece of cake. Why? Because my capacity is enlarged, my ability to handle my emotion, to control my emotion is more in check, is is is more controllable, you know. You know, and so it's you know, I'll finish with this. The donkey that fell down the well, and all the local villagers decided, well, he's never we can't lift him out, and he's never gonna get out of that well, right? And he's you know, he's he's down the well, and they're just like, you know what, we'll do, we'll just bury him alive, and that'll be the end of that, and we won't be able to use the well anyway, because it'll be poison, and uh, so uh, yeah, let's just bury him. So, what happened was the locals would start dropping dirt on his back. And then what he would do is he would shake that dirt off and he would use that to elevate his position. And I want you guys to do the same to the point where eventually there was so much shit being thrown on that donkey that fell down the well, it eventually elevated him to a position where he could just walk out of that thing himself. And I want you to do that, I need you to think about that. It's not what you're going through, it's where you're going to. This too shall pass. Okay, and I just steal all that stuff. It's from the books that I've read and the the in the old days of CDs and tapes that I've listened to and all the coaching that I've had over the years. It's about the mindset. So let's go back to thinking about when's the right time to grow and expand a business. It's when you got your head straight. Guys and gals, email me maxelitebusinessadvisory.com. Appreciate you hanging with me for this long. If you want to chat with me about business coaching, hit the uh book a consultation button. We'll run through all the different options you've got there. We'll talk about what's working for your business, what's not, where do we need to pay attention to? And uh don't forget, like and subscribe, get across to business for builders VIP. If you want to be in the private group, answer the questions. I'll let you in. If you just want to go across to Business for Builders, there's an open group there as well. We cater for everything here at uh Business for Builders and Elite Business Advisory. Great to have you in the house. I want you to go and have an awesome time building your business, better lifestyle off the back of more profit because you build a kick ass business. See you in the next episode. Cheers