August 25, 2023

Advice for Starting A Remodeling Business

A few months ago, a young man named Logan reached out to me expressing some concerns regarding his existing career path and the potential trajectory of such. He is currently self-employed, and works within a niche market installing Rolex boutiques for an architectural firm. He is currently traveling for 6-8 months throughout the year, and hopes to be able to settle down and work more locally in the future. To further complicate things, he is relocating shortly, which brings about a plethora of challenges for a small independent contractor. Logan is unsure of what his next best move may be within the trades, and hopefully we can help him out!

1.) When someone is trying to decide whether or not he is qualified to be a contractor of a high-end kitchen and bath remodel business, where does he say yes; Can I take this on and not feel like a fake? When does he say no, would I be better suited to another area? I have the carpentry skills for cabinetry/installation and am learning finishing, but those are the only things I feel I could do with extreme care and confidence.

In my opinion, you can only say yes to the jobs that you can execute adequately, properly, and fairly. Whether you are making money, losing money, or just scraping by, high end projects have large stakes and must be executed well. If you start at the top and spend twice as much time because you are learning, you will lose money and your customers will not be happy with the timeline. If you charge the going rate, but the quality is not there, your customers and vendors will not be happy with the overall execution. If you undercharge, take your time, and execute well, your customers may be happy that they got a deal, but this is not sustainable on your end. 

My suggestion would be to start with projects you feel comfortable with as far as your skillset goes. As you gain confidence, begin to take on jobs that are slightly above your skill set and learn as you go. The mistakes are less impactful, you will be investing in your business and gaining knowledge, and your customers will be slightly less discerning, creating less angst and pressure. Take smaller, more manageable steps, and learn as you go. 

2.) When do you decide to self-perform vs. subbing out? Do you use smaller projects with a little breathing room for error to practice skills you are less proficient in and use the larger projects to bring in the big guns? I imagine it is so much more efficient to self-perform on a smaller job than it is to organize and manage a schedule of several other trades.

Start with self-performing as much as you can to establish and build your technical aptitude. It is much easier to manage a trade for which you have experience self-performing. Subcontract out all trades you are legally required to do so. Shadow these contractors to gain a greater understanding of what they do, how and why they do it.  As you become more proficient and gain experience, start to sub out trades that are lower stakes, trades that do not affect the overall quality of the project, or trades that you can make money handing over. Good examples of these trades are demolition (not site-protection), insulation, drywall, roofing, siding, etc. This is not to say that these trades are not highly skilled, but they typically require larger crews, they profit on efficiency, and they are all highly competitive, so you can subcontract them for less than you can self-perform them. I have also started subcontracting trades that I no longer enjoy. There is nothing wrong with that, but I feel I had to “earn” that luxury. 

3.) What sub-contractors could I expect to build relationships with in a kitchen and bath arena. I feel like tile guys, plumbers, and electricians are the obvious ones, but maybe drywallers, painters, engineers, architects, designers. I guess this is somewhat linked to question 2. I ask because I'm sure there is someone I'm missing that I'm not used to running into.

I would start with vendors. Find a good kitchen cabinet vendor who does kitchen design as well. They can feed you work and you can create a long-lasting relationship with them if things go well. Find designers who specialize in these arenas. Not all designers want to be doing large-scale renovations, so find someone who is a fit for you and your current business. Next, find a good plumber, electrician, and HVAC subcontractor. I have started subbing out most of my demo, drywall, insulation, and hardwood flooring as well. I would love to find a good tile sub, but it has been tough for me. You will also need a stone vendor/fabricator, plumbing/lighting vendor, tile vendor, and appliance vendor. For bathrooms, a good glass company is worth their weight in gold.

4.) Would you recommend starting in a lower market to polish the skills of management? This one is the hardest one for me. I've been working in luxury for long enough now that I feel that I might lose my ass on any lower tier work because I just can't work fast enough and my desire for a fine finished product is one of my top priorities. I understand this sounds pompous and self-congratulatory, but that is not me. There are so many good people out here trying to make a living with so much more skill and business sense and sensibility, these are just the tolerances that were absolutely DRILLED into me.

The answer to this question comes down to experience. Managing a high stakes, detail-oriented project can be less about what subs you use but rather how you manage them. If you do not have experience managing subcontractors or self-performing this type of work, it does not matter your experience in other realms, you will lose your shirt on any project. I also find it more difficult to land the nicer jobs if you do not have the portfolio or experience to support that work. I would suggest starting somewhere in the middle. Find decent subs at a decent price point and refine your business from there. Work as a team to become better, more skilled, and more efficient. If at some point you outgrow or out-class your subpool, find new subs that better fit the bill for what you are looking to do. Business is a constant evolution and adaptation. Just because a subcontractor was great on your last project, does not mean they will be great on future projects. Keep the leash short, check their numbers, and remain present/engaged.

5.) Would you recommend getting on a remodel crew? Ideally I would love to work under someone who is doing what I want to do. But those guys want to work by themselves. Small, lean, detail-oriented.

This comes down to what you need personally and what your experience level is. If you feel you would benefit from this in the long run, then it may not be a bad idea. You will have to invest your time upfront for long-term rewards; meaning taking a pay cut initially as an investment in your experience and education. If you have little to no experience, working for someone initially is a no-brainer. Learn on someone else’s dime. 

If you feel you possess the skills with your hands, and it is more of a shift within the trades, maybe you do not need to go work for someone else. I started my company because no one was doing things the way that I wanted to be doing them. Working for other people was creating bad habits and perpetuating the common issues within the trades. Had there been (or had I been aware) of a job opportunity more inline with my ethos, it may have been a better investment of my time to work for someone else for a few years before starting my own business. 

I am sure there are many other opinions regarding your question and concerns, but I can only speak for myself. I hope this serves you well and translates into value for you and your company. Best of luck with everything!

- Tyler Grace