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Discussion Starter · #1 ·
I am totally wiped out...

6 months into the new exterior remodeling business (Windows, siding, gutters, doors). Canvassers, bookkeeper, appointments setter, sales/production guy, 3 -sub crews. Everything moving along great...ahead of projected revenue by 20%.

Then a MONSTER hail storm lands in my home town where most know who I am. My wise ass sends my canvassing crew and sales guy out to the field the next day and 10 days later ends up with about 50+ contingency contracts (advice of a buddy, "Have them sign a contingency agreement") and picking up 2-3 a day after that.

Worst thing I ever did...

1. I had dabbled with idea of doing roofs. Now we're forced to. Been drinking from the fire hose on products, installation techniques, codes, insurance, etc. Passed the licensing exam on the first try, got the correct insurance, bought the IRCA Guide to residential roofing and read the whole thing, went to the IRC Convention in Las Vegas and talked to everyone who would listen. Read 100's of posts on roofing. We have 60 roofs to install. I've got 3 crews a day from all over from $55/sq to $100 square calling me telling me they are the best.

2. It totally shut down my business on the retail side. All the sub crews are working the storm, the sales guys are working referrals, my appointment setter is keeping up with the storm customers and setting up all the visits that go with that. In the meantime I have canvassers on the street getting leads that the appointment setter can't set because there are no sales guys to sell or crews to install. I can either fire them as wasted overhead, keep them since they've been here from day 1 and the storm stuff will eventually end, or re-assign them to positions they know nothing about.

3. I can't capitalize on the storm because if I hired another appointment setter, sales guy, and sub crew I'd have to recruit, train, develop, and retain those guys while trying to keep everything running on the storm side and I don't have the time.

4. Insurance work is tough. Every customer wants to match their existing siding or the same shingle or old style wood windows to match the 1910 pieces of crap they had before. Then when we try to upgrade them they don't want to pay out of pocket. We had 1 siding panel, 1 window manufacturer, 1 door manufacturer we worked with. SUPER SIMPLE. This insurance crap has us sourcing from 1000 different suppliers. ugh!

4. The prices are all over the place in the scopes of loss. None of the SOL's are correct. They never give the money needed to cover the work unless I can squeeze GCO&P out of them and then it's adequate at best.

5. My insurance went up like CRAZY for the add-on for roofing.

6. My main window installer just got offered 25% more per window to come on full-time with a competitor and bailed, my main siding crew crashed off their scaffolding after retaining wall collapsed (blown disc, split head, cracked ankle to name some injuries), my roofers are mad because of supplier hold-ups, backer-orders etc and are threatening to bail.

7. The appointment setters computer shut off and won't turn on again.

8. Jobs are taking hours and hours of reviewing SOL's, calling adjusters, sending photos, matching products, picking colors, dealing with the mortgage companies trying to get down payments, multiple visits to job sites. We're used to 2 hours presentation, 1 hour of admin work per job, check on the install for 30 minutes, process completion, check in the bank.

9. Every HO wants there job done NOW! Let's see...1 week for adjuster to show up, 1 week for SOL and check, 1 week for amending the SOL because is was jacked up, 1 week for the mortgage company to release funds, 2 weeks to receive materials, 1 week by the time it's scheduled, another week of waiting for depreciation check. 2 months. But they want a roof up 3 days after the check hits their box.

10. We sold vinyl windows and siding, entry and patio doors, aluminum gutters, and steel and fiberglass doors. Now my sales guys have decided we are General Contractors. Wood doors, wood windows, shake and flat roofs, garage doors, decks, copper gutters, wood and vinyl fencing, cedar siding, steel siding, painting, etc. "Oh! The Scope of Loss says they'll give you $60,000 for the a new roof, windows, gutters, painting, plaster work, flooring, paneling, and blown in insulation? Yep! We can handle all that!" Holy Mary Mother of God...

So. Scooped 2 sales guys I had trained and developed a few years back that wanted to leave where we worked together...they start Monday. No training required. Had a brainy neighbor kid fix the appointment setters computer then sent him to the movies with his girlfriend on me. Had a meeting today to train my sales guys how to get everything done (Scope of Loss review, product selection, contract, pictures, material lists, etc) in one appointment. Found a supplier that has everything I need and worked out sweet pricing if I can give him all my business. Hired a retired insurance adjuster who used to be a GC to handle the insurance paperwork and to interview and coordinate installers...He starts Monday. Gave my bookkeeper a temporary raise to handle some admin duties since she used to own her own exteriors company and she is doing an amazing job (General Manager material...who knew).

So in 2 weeks I've
-Hired 3 people
-Hired 2 sub-crews
-Promoted someone
-Changed Suppliers
-Revamped my sales process
-Added 5 more product lines
-Changed contracts
-Changed my contractor's license
-Bought and got trained on Xactimate

Basically we'll come out the other end with a more robust infrastructure, more broad product offering capabilities, wider pool of subs to pull from, ability to capitalize on the next storm, and some nice capitalization for market expansion or...out of business.

Up goes the white flag :surrender:
 

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When you said your sales guy came up with 50+ contracts, what was the start date on these contracts? I've been getting busy too, but I know what my schedule is. I don't promise anyone to start in two weeks when I'm already booked for three months.
 

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Discussion Starter · #3 ·
We don't put start dates on them. The small print on the back says "of our choosing" and that the "customer has to make the property accessible within 30 days of contracted date" or we can cancel.

I've sent out a letter the customers should get Monday outlining time lines and all the steps it takes to get the job done. I think that will help.
 

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You make them sign first and then tell them the start date later in the mail? Why not decide that in your initial proposal and put it in your contract? The way you're doing it sounds a lot more time consuming. Sounds like it can get you into trouble too when they expect you there next week and write them a letter saying you'll be there in six months.
 

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Discussion Starter · #5 ·
The original meeting was a canvasser texting my sales guy. He'd go over to the house, tell the HO about our company and process, the HO agrees we're the type of company they'd like to have restore their home within the Scope of Loss, and they sign. I don't know how long it will take their adjuster to get there, how long before he gets his SOL to them, how long it will take for the check to show up, if it will be cut to them or the mortgage company, if the materials are in stock or will have to ordered, and what the installation calendar will look like by then.

Just getting tossed into storm work I didn't even know the process. We just knew our town got whacked, I knew a ton of people, and they wanted me to do their work.

I think everyone is good so far. I've just had to restructure my company in 2 weeks after finally getting it running like a champ over the past 6 months.

We'll see if the new "truck" pulls it's weight or is just a gas guzzler that looks tough.
 

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You make them sign first and then tell them the start date later in the mail? Why not decide that in your initial proposal and put it in your contract?
Everything hinges on the insurance companies when there is a big storm. Typically local roofing crews are overwhelmed, and crews are brought in from other areas /states, if it's big enough. People get put on a list - just the way I've seen it done.
 

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Here are some things I think you can use work on, to start with:

#1. You're trying to grow your company too soon, too fast. With any business, the faster you grow the higher the risk. The slower you grow, the less the risk. Insurance job proposals are very time consuming, they are a pain which is why most people stay away from them. I would never have 50+ insurance contracts that fast unless my company had already worked my way up to that point and I knew I had the properly trained staff to handle it.

#2. The order in which you are planning your projects is not right. Meaning the whole sequence from meeting with the homeowner to the point of actually starting the work. It will be different for each job, insurance jobs take more steps and are generally slower. It sounds like you are jumping ahead, skipping some steps or doing certain things too soon. Kind of like guys who build then design later, instead of design first then build. It just causes stress, lots of problems, and liabilities with the homeowner.

#3. Your contract is lacking or mis worded. You are probably missing information on your progress payments, durations, start dates, point of completion, etc.
 

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The only thing missing from your post is the part where you say how your nailing down as many shingles as possible but can't keep up.

You want to be a Cadillac contractor but don't know how to even install a roof.....Meh cry me a river
 

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Your contingency contract is a bait and switch and will earn you enemies. Especially when it starts raining and people start having losses because you didnt fix their roof before the rain. Watchout or there will be a local news expose about the latest storm chasing scumbag contractor, you.
 

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Your contingency contract is a bait and switch and will earn you enemies. Especially when it starts raining and people start having losses because you didnt fix their roof before the rain. Watchout or there will be a local news expose about the latest storm chasing scumbag contractor, you.
I've seen roof jobs after major storm damage take up to a year, Take something like what happened in Dallas about 10 years ago - hail up to softball size, huge super cell so roofs for miles and miles were trashed. Even with bringing in roofing crews from all over the US, it still took a very very long time for the last in line to get finished. How people get stacked in line is the adjuster has to come and look the roof over to see what they'll pay for, then you get one or more estimate and contract with someone. You aren't in line to get your roof fixed until you sign the contract - no guaranteed completion date.

Meanwhile. you (the HO, or who ever he can hire) take whatever steps needed to prevent further damage and submit this to the insurance company as well.
 

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You probably should have stuck to what you know.

I see lawsuits and News cameras in your future.

teach your sales staff better and teach them to roof.
Be careful and proof me wrong, good luck.
 

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had a tornado in the next town over....Paul Davis restoration got tons of them.....so many they could get any of them done.....ended up losing most of them in the end

i am not sure if i would have ramped up like you did.....i guess you will know when your cashin in an extra $150,000 in your pocket this year......dont forget to ramp DOWN when you are done....have a plan for it
 

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I've seen roof jobs after major storm damage take up to a year, Take something like what happened in Dallas about 10 years ago - hail up to softball size, huge super cell so roofs for miles and miles were trashed. Even with bringing in roofing crews from all over the US, it still took a very very long time for the last in line to get finished. How people get stacked in line is the adjuster has to come and look the roof over to see what they'll pay for, then you get one or more estimate and contract with someone. You aren't in line to get your roof fixed until you sign the contract - no guaranteed completion date.

Meanwhile. you (the HO, or who ever he can hire) take whatever steps needed to prevent further damage and submit this to the insurance company as well.
Yeah, I probably said that too strongly. It just put me off that the op said there was no start date on the contract, in the fine print on the back. Would have taken it easier if he said we tell all of these people up front that we are slammed with work and it may be months before we even get on the roof.
 

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Yeah, I probably said that too strongly. It just put me off that the op said there was no start date on the contract, in the fine print on the back. Would have taken it easier if he said we tell all of these people up front that we are slammed with work and it may be months before we even get on the roof.
I agree, you have to tell them up front and clearly that they're going to be waiting in line - It's the best you can do, you'll be completing roofs and quickly as possible, consistent with providing quality roofing.
 

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quit doing the side work and just do the roof. that side work will kill you and drags out the job forever. bill the insurance company whatever you determine you want to make per square and be done with it.. whats so hard? meet the adjuster on the roof when he inspects and go over what needs to be paid for then ...
 

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Hey, I was thinking about some things you said yesterday and if you have that many contracts lined up, it would be in your best interest to get a buy in agreement with your supplier... tally up how many squares of each shingle youre doin w the same color an see what kind of numbers the manufacturers come at you with. Also try home depot bid room. I've gotten some pretty nice deals there.

If yoy get something that saves you a few grand, schedule all those roofs with that color back to back... With 4 crews you can start knocking them out so fast that your supplier may even store them for you.

Just a thought.
 
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