Employee Compliance Cost Businesses Thousands

If you’re in the construction business and have gotten bigger in size over the year then you sure as hell have employees. Once you got a good home remodeling crew, a fantastic concrete group, or you are a framer and have some good-ol-boys that can frame things up in no time at all, you want to keep it going and working great to keep your construction business growing. Face it, without good employees, your business will wither away and die. You need them. But, with having employees, come all sorts of rules and compliance that you must follow.

Things like giving your workers two 15 minute breaks a day, making sure that they take a lunch break at the proper time and make sure that they do not go past the “5th hour” without taking a lunch because more potential penalties will start to really pile up. In states like California, fines for those types of violation can run into the thousands. Then you have some states requiring businesses to add sick time and sick pay to your payroll too. It never ends!

All of these employee compliance rules cost employers thousands of dollars a year.

And how does this happen?

Politicians and their campaign promise to supposedly “help the little guy” from the clutches of these big bad businesses that take advantage of hard working folks. The poor worker does all the work and the greedy business owner, like you, the owner of a construction business, keep all of the money all to yourself.

It really is a great way to get elected right? I mean, workers outnumber business owners in construction businesses by al least 10 to 1. It is an easy way for politicians to woo hard-working Americans into voting for them and their stupid employee compliance rules. Little do all these employees realize that business owners profits are actually quite slim. There are some businesses that only bring in some slim 10% returns. With such slim returns, construction business owners will always look for ways to cut expenses. What this means is that they may lower the hours the give, cut out some benefits they provide, freeze hiring, or worst, start to lay people off. All these added expenses don’t come at a cost.  Employees are pretty much shooting themselves in the foot thinking they can get politicians to get their employers to give them better perks when the complete opposite takes place.

So, how can you as a construction business owner start to change things?

It’s actually not that difficult to do, and if every single small business in America began to do this, a lot of this unnecessary regulation would never even get on a ballot.

It’s simple really. Let your employees know more about the actual business that you run and how they are an integral part of it operating smoothly. Let them know how you bid on jobs, how you calculate cost, how much materials cost, taxes that must be paid, and how you come up with the numbers that also include their wages. Even be upfront with them about what type of profits you expect to make on a job. Be transparent. I bet a whole lot of the employees you hire probably like you already on a personal level!

The thing here is to let them know what really takes place in a construction business. Let them understand that you put up all the risk and money to do the work and that is why you take a profit. A profit you use to further grow your business and also provide a good life for your family. You see, your employees will see the sacrifices that you make to get work and make a living. They will begin to see the inner working of how a job is bidded in a way so that everybody wins. Customers get great quality work, employees get more hours and more work, and the owner makes a profit. They will start to see how they themselves can help lower the costs of jobs to help increase profits, thus allowing for added raises and even benefits.

If every construction business owner were to do this, then those 10 to 1 ratios politicians love will become completely one-sided. The employee will always side with his boss. The employee will see the conniving snakes in the grass those politicians are with their weak promises.

Special thanks to a special crew out in Fresno, CA and their business.

Build Your Construction Business Like McDonald’s Makes Burgers

It’s often been said that McDonald’s is a billion-dollar company that is run by teenagers. If you’ve ever looked up at their signs that say billions and billions served, it’s hard to believe that a bunch of teenagers could do so much. But how? And how can you take some of the lessons that were engineered by Ray Croc to build a construction business that can do the same for you?

Most people that start out and build a construction business are usually people that start off as an employee of another construction company. Most of the time, they are extremely good at what they day. Be it being a framer, a cabinet installer, a flooring installer, a roofer, or even a plumber. They are a great worker and know how to do the job right. Some might even say that they do an even better job than the boss that they work for. They do such a great job that some start telling them that they should break off and build their own construction business with those skills they have. That’s when “Bobs Plumbing” is born, “Todd Thompson Roofing” is established, “Gary Shultz Flooring” is incorporated. All these so-called construction businesses are built and created with the owner and experts name all over it.

The problem is, these construction businesses are built with the goal of having the owner operate every single aspect of the business. From acquiring the work, bidding the work, doing the work, supplying the tools and supplies needed for the work, billing the work, collecting the money, balancing the books, paying the taxes, paying business licenses, and the list goes on and on. The once great “plumber” that did superior plumbing for a company he once worked for is now having to put that skill to the side to learn a dozen new skills he’s never had to deal with before. Before long, this new business owner begins to burn out and tired of doing everything on his own.

This is why more than 90% of business owners fail in America. They are built as a single unit or individual running the entire show. The way to build a great construction business is by using the same formula that Ray Croc, founder of McDonald’s, used to build one of the most successful companies in the world.

What Ray Croc did was see a burger business that provided not just hamburgers and fries, but a system that provided burgers and fries. He saw how by systemizing every single part of the business into small individual smaller bits could simplify the whole process of making burgers. He was a big fan of Henry Ford’s assembly line and how Henry revolutionized the industry. By having one person work on one task and master that task and having another work another section and master that, he made building a car into a streamlined business.  One person puts the tranny together, another the radiator, another the frame, and yet another person works on the rims and tires. Each person mastering each position.

Ray Croc did the same thing with McDonald’s.  One person is trained in just a few days to run and operate the register and only the register. Another is trained to build a burger. Another is set on the fryers. Another set on drive-thru. Each person is taught within a week or so on how to do their sole specific job and only that specific job. Why? A McDonalds with all those people running it works smoothly and predictably. If a cashier fails to show up or does not work out, a replacement can be put in place in a week. A burger assembler quits, no problem. Another can be hired, trained, and put on the line within weeks. The business does not fall apart with the missing of a single person. It keeps moving on. No person has the power to sink the business with them not being there. It is the system that keeps it going and specific job assigned to numerous people.

A construction business built by a single individual completely fails with the owner not being there. “Bob’s Plumbing” is only “Bob’s Plumbing” with Bob there. Without Bob, it is done. He is the marketer, the bidder, the plumber, the tool supplier, the parts supplier, the secretary, the bookkeeper, the bill collector, the revenue collector, and everything else in between. The best way to build construction business is to build it as a system that supplies plumbing for example. You must build it with the vision to see far ahead that every part of the business is broken down into many smaller jobs.

The best way to build a construction business is to build it with the intent of having it all operate without you, the owner, ever being there. Just as Ray Croc did and still operates without being here himself.

All of this was brought to our attention by a small but very productive tree service company in San Luis Obispo. The owner Tony tells us that it is Ray Croc that inspired him to start a tree service company which he would then systemize and have it operating like a well-oiled machine. He is doing just that with his business and is prepared to go for the long haul in doing so.