Boots on the Ground

Subcontractors, The Heartbeat of Construction

Tag: NC Subcontractors

What Are We Teaching Our Kids?

The State of Arizona has just passed a law that a student will not be issued a high school diploma unless they can pass the same Civics test that an immigrant is required to gain citizenship. Why are they doing this? A survey of graduates revealed that only 36% knew there are three branches of government. What does that have to do with construction? It illustrates the lack of attention to basics that infects public school systems throughout the country.

When I was in high school in the mid 60’s, if you were not in the college preparatory program, you were possibly enrolled in a program called Distributive Education (DE), sometimes known elsewhere as Vocational-Technical (VoTec) education where you spent half your school day learning a trade such as carpentry, welding or hair styling. Or, you could be enrolled in classes at the community college taking auto mechanics or auto body repair. And, the high school offered business classes such as typing and shorthand to prepare you to work in an office. Some high schools also offered Jr. ROTC classes to prepare students for a military career. These classes prepared students to be gainfully employed the day after they graduated from high school.

Today, it appears our public schools are turning out graduates that are woefully unprepared to perform an entry level job in construction. They need math. They need to work with fractions. They need to understand geometry. They need to understand shop drawings. They need to be able to read to learn and comprehend OSHA rules and regulations. They need to write legibly in a comprehensible manner so they fill out job reports and time sheets. They need to be able to speak clearly so that co-workers and supervisors can understand.

When I looked at the Charlotte-Mecklenburg Schools website, there is a program called CTE (Career & Technical Education). There are a few courses offered that are applicable to construction: Carpentry, Drafting and Core & Sustainable Construction. There are also some courses listed that are available through CPCC (Central Piedmont Community College.) These coursed are not prominent on the website and I only found them on my second attempt. These courses don’t appear to be promoted or have any outreach or placement programs with employers.

CPCC has a Construction Technologies program at its Harper campus. Several years ago, Steve Corriher instituted a training program to teach the basics of construction. In this case, the basics mean how to use a hammer and read a tape measure. At completion, the class can stick build a storage shed with door, windows, siding, shingles, etc. If this type training was available in high school, students might be ready for a good paying job when they graduate.

These are not dead end jobs. Most people who manage or own construction companies worked their way up through the ranks. In my company, below the corporate office level, people with degrees are in the minority. They have advanced because they work hard, work smart and never quit learning. We can teach someone the specific operations of our industry, but only if they have the basic education that is required to perform the job.




Outstanding Subcontractors

Handford PS

The closing speaker at the annual meeting of the North Carolina Subcontractors Alliance was Rick Handford, president of Myers and Chapman, Inc. Myers and Chapman is one of the larger general contractors based in Charlotte and serves North Carolina and the surrounding states. Mr. Handford has been and is very supportive of subcontractors in general and the NCSA in particular, which endowed him with their Golden Boot award in November, 2013.

Mr. Handford began by stating that Myers and Chapman, like most commercial general contractors today, does not do any of the work. Their function is to facilitate the construction of a building. They put together the bid, negotiate the contracts, manage the actual construction and manage the risks. The actual work is done by subcontractors and their suppliers. Without subcontractors, the general contractors would be unable to perform their job. And, without outstanding subcontractors, the jobs can’t be performed on time, as specified and profitable.

He said that Myers and Chapman believes that the Charlotte market has depleted its inventory of desirable commercial properties and is predicting a ten year period of continuous growth. He also believes, based on past experience, that this will be a perilous time for subcontractors and encouraged the NCSA to reach out to the small subcontractors that will attempt to perform larger work and residential subcontractors that attempt to move up to commercial work without the proper knowledge.

He also cautions subcontractors to not try to take on more work than they can do comfortably. There is a shortage of skilled tradesmen, and vendors have longer lead times and are raising prices. And, the big thing is you may end up with all your working capital tied up in inventory and retainage. Without available working capital, you are out of business.

Mr. Handford also presented a poster that hangs in Myers & Chapman jobsite trailers. It details what Myers and Chapman expects from subcontractors and what it takes to be on their team:

1. Are committed to safety. – The costs of safety and insurance can be substantial.
2. Communicate well with the team. – Advise them if there are delivery or money problems, they may be able to help you through a temporary condition.
3. Meet schedules. – The schedule is important to the profitability of the job and the failure to meet them impacts everyone who comes after you.
4. Know the job. – Your workmen should arrive with drawings and all the tools and equipment to do their job.
5. Do it right the first time. – The cost of doing it right is always less than re-doing defective work.
6. Represent us well with our clients. – Workmen should always be presentable and respectful on the job. They not only represent the subcontractor, but Myers and Chapman as well.

I put a copy of these in my company’s conference/training room and I strongly advise everyone to do likewise.

NC Subcontractors – First year on our own

The following is a review of the first year since the NCSA separated from the ASA of the Carolinas as written by Margaret Drummond and submitted to the National Subcontractors Alliance quarterly newsletter:

This July, the North Carolina Subcontractors Alliance celebrates our first year as a subcontractor group independent of the American Subcontractors Association. Twelve months ago, our meager fellowship (then as the Charlotte Chapter of the American Subcontractors Association of the Carolinas) unanimously voted to disassociate from ASA and rename our organization. Under the leadership of our devoted Board of Directors, we have spent this first year working toward our renewed goals of community leadership, unity, and support for our subcontractors.

Though we changed our name when we disaffiliated with ASA, we have not changed the strong tradition associated with North Carolina subcontractors. We are still a member-driven association and proud of our accomplishments. In March, we proudly joined the National Subcontractors Alliance. Having made contact with Executive Director Lynne Black in our early days, the NSA has nurtured our first year and provided the NCSA with continued support and encouragement. Even prior to joining officially, members of the NSA have offered their guidance and experience to help our local chapter re-establish ourselves as a stronger organization for our subcontractors. NCSA knew from our first encounter with NSA that this was where we were meant to be; an affiliation with a group of like-minded, trustworthy professionals whose goal is the betterment of our businesses.
NCSA membership has continually grown since our formal disassociation from ASA; and our membership is much more active and engaged. The positives have far outweighed the challenges already. We are confident with the help of NSA our membership will continue to grow. Our current benefits of Networking, including our Business Information Exchange meeting, Educational Materials & Programs, Monthly Newsletter, Government & Industry Legislative Advocacy, and Mentorship will continue, but joining NSA will help our members to boost their bottom line. As an NSA member, they are now eligible to receive valuable discounts that include: FedEx Shipping Services, YRC Transportation, UPS, OfficeMax Advantage Program, TSYS Merchant Solutions, Lenovo Affinity Program, Intercall, and AchieveLinks. One member has already reported the advantage of reaching out to an NSA member in another state to exchange notes on their experience with a national General Contractor.
I have discovered firsthand that if we work together and rely on one another, we are less likely to feel isolated. It is comforting to not have to “reinvent the wheel” every time we try something innovative, because through NSA, we are working together with other leading associations who freely offer their experience. Moving forward will be nothing short of an adventure. After a year we are a more successful and stronger association and are looking forward to our new relationship with NSA to continue that growth. Our membership has already been priceless.

The momentum must continue because much still needs to be done. We cannot allow our progress to stagnate. We have actively been attending local meetings, participating in the North Carolina level construction legislation, networking to keep our interests on the front line and partnering with other associations across the country with the same interests and more. For NCSA change is the new status quo. Everyone owns the responsibility for making the changes work. By joining NSA we have chosen to be a part of a national organization that is leading the construction industry into the future. “NCSA is a part of those that lead and not those that follow”…and we are very excited to see what’s next.

Margaret Drummond
North Carolina Subcontractors Alliance
PO Box 30604
Charlotte, NC 28204

Construction Trends – Green Globes and Net Zero

At a recent NC Subcontractors Alliance meet and greet, Bill Lorenzo, pre-construction manager with Balfour Beatty Construction’s Carolina Division, presented things that are trending in North Carolina. The most important is energy sustainability. He showed a chart showing that over the lifetime of a building, only 11% of the cost is related to construction and 85% is the cost of energy to power the building and its systems. It is becoming more accepted that an investment in sustainability saves money over the long run. More and more building owners and developers are requesting their new buildings be energy sustainable. But, they want to do it without all the rules and paperwork involved in the LEED program.

The big trend, now, is the movement away from LEED and toward a program called Green Globes. Green Globes is a web based program that began in Canada. The Green Building Initiative acquired the US rights to the program and administers it in the US. A building is awarded points for various attributes, the largest attribute being energy consumption. Upon verification by a third party, the building is awarded 1 to 4 globes. The use of Green Globes substantially reduces the administrative cost of obtaining a certified energy sustainable building.

The next thing to come will be Net Zero Sustainable. This is becoming common in California and Balfour Beatty is working on designs for the first one in Charlotte. In Net Zero, the building must produce as much renewable energy over the course of a year as it consumes. The building is connected to the grid and sells surplus energy to the grid on sunny days and buys energy from the grid on cloudy days, with the goal of achieving a net zero energy consumption. This is more challenging on the east coast because there are more cloudy days in the Carolinas than in California. We will have to wait and see how that works out.
Lunch n Learn at Balfor Beatty
The bottom line is that subcontractors need to be more aware of sustainability. It is not just a government mandate now, it is a trend coming from building owners and developers.

What Gets Checked, Gets Done!

Inspector with magnifying glassAnother one of Gary Olnowicz’s “Lessons Learned” from his July 2013 presentation was “What Gets Checked, Gets Done.” What he means by this, is that even the best of your employees need to be checked. Without supervision, there is too much temptation to cut corners or work down to the lowest common denominator. Further, labor productivity is critical to the profit margin and the cash flow on the project and needs to be tracked. If there is a problem on the job, the earlier you know about it, the more time you have to create a solution. If you can’t solve the problem, you can at least adjust the markup on your billing so you don’t go negative at the end of the job.

Once again, the Mercedes Benz Truck Assembly Plant in Hampton VA that I mentioned in my previous post provides a personal example. We were about a week into the job of installing the strip windows in the job. The Glazing Superintendent came in to the office and started calling Miami Wall Systems and ordering window components. When I quizzed him about it, he said the window mullions were not lining up with the columns as they were supposed to and he was going to have to make up additional small window units to compensate.

I accompanied the Glazing Superintendent back to the job and started checking the drawings against the installation. These were self-mulling windows; meaning that the vertical jambs had male/female components so that one window jamb was inserted into the jamb of the next one. I observed that the drawings provided by the manufacturer showed a 1/8” gap for expansion between each window, but the windows had been installed tight together. When quizzed as to why he had not followed the drawings, the lead installer (who was also the shop steward) snapped back that he knew how to install windows and that they were supposed to be tight together.

Long story short, the first week’s work had to come out and be re-installed. From then on, everything worked perfectly. At the end of the job we had one item on a 53 page punch list. We had a labor overrun from the part of the job that had to be re-done that cost me $1,200 out of my commission. But, I still had my biggest commission check ever.

From that day forward, as long as I was a commissioned salesman, I made it a practice to visit the jobsite on the first day and last day of work of each job. On the first day, I would show up in the early afternoon to see if the installation was going as expected and diagnose any problems and address solutions. On the last day, I would punch out the job as if I was the customer, including the operation of each door and the door hardware. I also carried a bag of thumbturns and Push/Pull stickers in my car. These were required on all jobs in the City of Virginia Beach and were often overlooked in the fabrication shop and their absence could cause an emergency service call when a Certificate of Occupancy was being held up. I had to look after my personal cash flow as well, you know.

Reach for the Stars if you Want to Get Ahead

MB TruckIn his presentation to the NC Subcontractors Alliance at their July 2013 meeting, Gary Olnowicz, president of The Linda Construction Company, said “Sometimes, you have to bite off more than you can chew.” The meaning behind this is that to grow in business, sometimes you have to reach beyond your comfort zone.

My moment came in 1978 when I was a young contract salesman for Binswanger Glass in Norfolk, VA. I was in my second year in sales. In those days, I was strictly commission, earning 15% of the gross profit of the sale. To get a jump start, I had been concentrating on small jobs that could be turned around quickly so that I could get into position to cover my draw. My commission was paid quarterly, after deducting for my draw and expenses. Luckily, I was successful in landing a very busy metal building dealer who furnished me a couple nice jobs each month and a builder who was building nine Roy Rogers Chicken restaurants in the area. We did not use project managers at the time, so each salesman was totally responsible for his jobs until they were handed off to the Glazing Superintendent to get them installed. It was taking a lot of time to stay ahead on small jobs, so I realized I needed a bigger job carry me along.

One day, I was alone in the contract office when the call came. It was a call from The Haskell Company in Jacksonville, Florida. They were going to design/build at truck assembly plant for Mercedes Benz in Hampton, Virginia and wanted Binswanger to price it for them. I wasn’t going to give it up. I had them send me the plans. The job was big, but fairly simple. It consisted of 1,000 running feet of 4 ft. tall fixed and operating self-mulling strip window units and a 100 foot x 27 foot tall curtain wall assembly. I got all my quotes, put the labor on it and went to my manager to get approval to bid it. We put the price on it and I rolled the dice.

A few weeks later, I got a call from my contact at Haskell. He wanted me to fly down to Jacksonville the following Monday to meet with the design team. I told him I would get back to him. Both the contract manager and branch manager tried to discourage me from going. They both suggested that Haskell was just using me and that I would be making a mistake to go. I said I had a feeling on this one and had developed a feeling of trust with my contact. He told me to go ahead, but he made sure I understood that all the expenses of the trip would be charged against my commission.  1978 was before airline deregulation and the cost of a same day trip from Norfolk to Jacksonville and back was $678. Yes, I still remember that amount. It was a significant amount when your monthly draw was $1,000. That was a sleepless night.

The next morning, I called Haskell and told them I would be there Monday. Sunday was another sleepless night. Up early on Monday to drive out to the Norfolk Regional Airport. The flight, including a stop in Atlanta took about four hours. A taxi ride to Haskell’s office and I was there with about 20 minutes to spare. The advantage of a design/build team is that everything is done in house. I was before the estimating team, the project manager, the architect and the engineer. I made my presentation, then we got to the meat of the meeting. The architect had specified Kawneer windows and Kawneer 1600 curtain walls. Binswanger was not a Kawneer dealer so I had come to the table with Miami Wall Systems windows and Amarlite curtain walls.

But, in an unexpected development, the project manager spoke up and said he did not object to Miami Wall, they had been used on several of their Florida projects. Someone else said, “I understand Amarlite’s curtain wall has a 2” wide mullion and Kawneer is 2.5” wide.” Before I could answer that I had figured on Amarlite’s heavy system, the architect spoke up “I don’t object to a 2” mullion as long as it windloads. A quick call to Jerry Wright at Amarlite got me the windload values and everything worked. I realized they wanted to do the deal as much as I did. They assured me a contract would be going out to me the next day. We shook hands and they had one of their assistants take me back to the airport.

There I was. A twenty-nine year old kid who had landed his first big job. I was walking on air. I don’t remember a single thing about the flight home. The moral of the story is you have to take a risk if you want to score the big one.

In Business, Relationships Rock!

Swim with the sharksFirst Posted September 8, 2013

In 1988, a man named Harvey Mackay wrote a book that set the business world on fire. It was called “Swim With the Sharks Without Being Eaten Alive.” It is an entertaining and enlightening handbook to be successful in your career and personal life. It is a networking bible. It established Harvey Mackay as a respected author and columnist.

The book chronicles Mackay’s career from a recent college graduate trying to find a job, becoming successful selling envelopes, to buying a failing envelope company and turning it into a huge success. The book has been re-printed and needs to be in every businessman’s arsenal.

As a construction Subcontractor, we are losing the personal relationships we have with our customers, the General Contractors. Invitations to bid are sent out electronically. To view plans, we go onto a contractor’s FTP site or to a service like iSqFt. We download and print plans or order the prints from a third party printing service. We send our bids by fax or email. General Contractors now have a “pre-construction” department that puts the bids together before handing them off to the project manager, sometimes with a purchasing department in between. Unless you have a relationship with a contractor, or a really low price, your lines of communication with the contractor are limited.

Getting to know the people in the company you want to do business with are more important than having the lowest price. Contractors are looking for the lowest responsible bid, and when the contractor knows you, you get a seat at the table when the job is bought out. What Harvey Mackay wrote in 1988 is relevant today, except that part about a Roladex. If you use Mackay’s principles, including the “Mackay 66,” the things you should know about your client, your business relationships will be greatly improved. For you youngsters, it is even available as an e-book.