Mark: Today on PowerTips Unscripted. We talked to Andy Haste, president of Riverside Construction in Lafayette, Indiana. Andy is among one of our most successful members, and he attributes that success to consistency and profitability. Sounds obvious, right? But how do you achieve consistent profits in such an unpredictable and inconsistent industry, such as remodeling? Well, we’ll hear how Andy does it in just a minute.

Victoria:  Hi, I’m Victoria Downing and welcome to PowerTips Unscripted, where we talk about tips, tactics and techniques to help you build a strong, profitable remodeling company. I’m here today with my co-host, Mark Harari.

Mark: Well good morning Victoria.

Victoria: How are you?

Mark: I’m doing pretty good. How are you?

Victoria: I’m great. Great. Ready? You ready to rock? This is one of my favorite topics today. Profits?

Mark: Yeah. Profits are going to be a good topic for sure. I was a little worried because our AC was not working when we came in this morning. I thought this was going to be a hot, sweaty show, but it started working. So we’re good.

Victoria: Yeah. So customer service from our landlord has been superb today. So it’s nice and cool in here with his wonderful lucky lucky. And today we get to talk to one of our cool members, Andy.

Mark: Hey, I see what you did there.

Victoria: now, Andy, I asked him specifically to do this because I always think of him as being this. I always call him a solid citizen in terms of our roundtable membership. He’s he runs a solid, strong business, you know, and one of the his claims to fame is consistent, profitable bility, which I love.

Mark: Consistency is key to so many things. I’m trying to get consistency on my golf game, which is an impossibility. So, you know, consistency. Consistency.

Victoria: Well, you know, for some remodelers consistency consistency and profits is impossible. It’s not really. They just think it is until they don’t get there. So let’s dive in and find out how Andy does it year after year. So.

Mark: Well I can’t wait.

Victoria: All right Andy Haste is president of Riverside Construction in West Lafayette, Indiana. He’s been a part of our round tables team, our round tables community for many years. He is a member of the mentor for Group, which is a group consisting of some of our most successful members. Thanks for being part of this, Andy.

Andy: Oh you’re welcome. Thanks for having me. And I’m looking forward to talking with you today. And sharing work has already been shared with me by many, successful promoters around the country. So, very fortunate to be part of a member of your hearts. And so just want to say thanks, lot. Is this for, just all the experience and allowing me to be on board with you guys?

Victoria: Awesome. Well, you’re you’re a you’re a wonderful representation of the best member in Vermont in round tables. So let’s dive in. I love the fact that you’re so consistent. And again, that’s so hard to get. Anybody can be profitable one year, but getting that consistency at the higher levels of profit is not easy. So what, in your opinion, are the top three things that are essential to having that consistent profitability?

Andy: That’s a pretty hard question to answer. But again, maybe three, maybe four.

Victoria: You that’s I’m sure you bet.

Andy: You know, I recently read a book or read a book, whole grain of choice. And it kind of broke things down and, succinctly for me and I, it’s, you know, when asking this question, why are we successful? It’s actually a number of reasons, but, I would say, you know, having great people, is paramount, of course.

Andy: But then once you have great people, it’s really about, winning rhythms. it’s about goals, setting, setting realistic goals every year. And then basically looking at your numbers, we go by weekly, you know, every two weeks and, we just, remove don’t accept, anything less than, profitable. So it’s really often that you were very first disciplined with your numbers.

Andy: So I would say those are some of the big things. And then they, they have a lot they grow on some of these things, but, it’s just a fanatic about numbers, about goal setting. Of course, marketing and sales are huge. yeah. We set we set the same goals every year and every month, and we get, to read through it and just make it happen.

Andy: So. But it’s not happen very often in corporate culture. So, it’s just a big, make sure, the strategic recipe that makes it all happen.

Victoria: Yeah.

Andy: A lot of fire, younger people and stuff. So.

Victoria: You know, you make it sound a little bit easy, but. So if it’s so easy, why do you think that other remodelers has such difficulty with this?

Andy: you know, one of the things I really value and part of our, culture at Riverside is continued growth. And along with continual growth. obviously you want to continue to grow and learn, and there’s a sense but also in a personal sense. And so in order to have that mindset of continual growth, you have to be humble enough to not think narrow.

Andy: So, I think, you know, in the past I’ve seen, remodeling companies where they come in and, and round roundtable, for instance, and they think they know well. And, that’s a recipe for not being profitable. Really. You’re not learning. So, we’re I’m always trying to learn from other people. I’m not perfect at it, but, I think you got to learn, what?

Andy: You don’t know. And always be willing to to apply what you learned so well.

Victoria: Can you can you can you give me an example, like, you talked about having a fanatical focus on profitability and you’re looking at your numbers bi weekly? Could you give me sort of a almost a role play of like, what does a meeting look like? What’s a demonstration of this fanatical discipline?

Andy: Well, we I mean, we have scorecards, you know, another book that, that I think is really good writing does is for disciplines of execution. And they talk about having, you have a scorecard, but you also have, 30 indicators. And so, for instance, for, for me, obviously you want example to set aside a leading indicator for us, for me personally is how many how many we call conferences probably priority to suicide.

Andy: It’s basically design agreements. And of course as a result to cater for sales later on. And so we try yeah, every month, every week. It’s kind of a day. So I said the whiteboard stuff is up on the board. it’s exciting to see your sales graph. but an example of, of discipline might be, you know, every two weeks while your circle, we sit down, we have a meeting.

Andy: these days, it’s all zoom because half the team is working from home. but I’ve got, like, goalkeeper involved, my, head design, and that’s the fire department leader head. And, and my production, person and we are looking at our, we’re looking at our record, our probability matrix, how we’re doing our sales. we look at our, the all of the metrics for our business, how we’re doing, are we keeping up the sales, production.

Andy: Each each member can bring something different to the production person. says we’re on several kinds are happy and we’re on budget. And then he’s got three key metrics that he tracks. And, if everything is clicking along, then, the business is running pretty smoothly. For every once in a while, something’s not right. So later we decide on how we fix that.

Andy: So so these are just some more of those. And that’s how we track everything. And some of the broken her out of it. So we’re we’re very in tune with each other.

Victoria: So let’s say you’re in your meeting and you can see that in the coming. Well let’s say one of the you’re leading indicator, like you said, was how many design agreements you have signed over the last period of time. So what if you are running short? What do you do? I mean, because you can see the numbers, but unless you have an action tied to it, some people would just go, oh, well, I guess we’re not going to hit it.

Victoria: What do you do instead?

Andy: Well, if we’re running short on some numbers, it seems like we almost never do. and part of the reason is we have a marketing plan. And so that marketing plan is very, very, very we are very consistently spending, 2 to 3%, well, I should say 3% of our revenue and work every year just like clockwork.

Andy: And we look at leads coming in, it’s a monthly, weekly, but it’s a monthly we’re tracking. That’s one of our, metrics that we’re looking at every two weeks. Also, at least, if that column or whatever you’re doing generally leads, well, there’s a number of things you can do. And so we activate that marketing campaign and if something’s slow, I mean, we never stop for the real work.

Andy: So that’s that’s, he,

Mark: And he can I can I jump in on that real quick? Just to clarify for you guys, is the, 3% of your revenue is that on your your budgeted target revenue or on your previous year’s revenue.

Andy: Usually increase your, no, I’m sorry, not for users. year revenue for the year.

Mark: Yes, but you’re going up. But you’re shooting for.

Andy: What was you personally know this year for, you know, we’re shooting for 3.5 million. Our our, yeah, our marketing spend is 3% of that.

Mark: Yeah. Good job.

Victoria: And actually, you’re going to hit more revenue than that, but you’re going to stick with this basic budgeted 3% of 3.5.

Andy: and, and we you know, everyone’s trying to understand the marketing, but you remember so it’s both. Well, you know, it was last year that was a little bit because we were coming as like crazy, you know, that 30% more last year than we thought we were going to do. And we, you know, our, our net profit numbers were amazing.

Andy: There was we didn’t spend as much as last year, but yeah, the goal is just an hour or so.

Victoria: So we’re the signing of the design agreements was one leading indicator. The marketing, the leads coming in is a leading, leading indicator. Right. So you’re looking out to even further make sure the leads are coming in to ramp it up. The minute you start to see things slowing down or numbers not being reached right.

Andy: that’s exactly right. And I love marketing. And I know, Mark, that’s that’s your big thing too, that, marketing is super important. You know, I always think of marketing is obviously nothing like I used to think. Nothing happens until somebody sells some. Mostly true. But really nothing happens is until somebody markets the markets correctly and strategically and with your marketing.

Andy: Well, telling people about you, doing a good job on the current, you know, with your current customers, making them happy. So also is huge. You know, it’s a huge thing. They sell money. And one thing it’s, you know, as as you all know, it’s about calling things together, right. That’s the value strategic. So.

Victoria: Now one of the other leading indicators or indicators I guess I’m not sure if it’s leading or lagging. Actually lagging I guess, is the customer satisfaction that your production manager reports on when you do your bi weekly meetings. What? How do you get that number and how do you make it? You know, a numeric measurable number?

Andy: Well, the radius numeric is, build quality. Okay. good quality surveys. However, it is just there are leadership rules. It’s really just him reporting on any issues with clients. It’s a really fast way just to, you know, do a, bi weekly check in on real estate. If or not, there’s often no or clients happy. in our real budget.

Andy: So. So anyway, yeah, that’s just a quick second.

Victoria: Okay, so another place that profitability dribbles away is in slippage with a lot of companies. So that means you have to be in order to avoid it. You have to estimate properly and then you have to produce properly. How do you tie those two departments together to make sure that everybody’s on the same page with that number and hit it?

Victoria: I mean.

Andy: Well, the first thing is, to set set for patients that progress those departments and, you know, pretty a of personality and, and, maybe a little aggressive at times to just make sure everything is right and, you try to be nice about it and you do. That is the goal that good culture and communication committee members I would rank.

Andy: My goodness knows that this is not an option. It’s not an option as leverage.

Victoria:

Andy: I’m making it too simple, but, and then we have the feedback loops too, so you don’t have to trigger. In my estimating manager, we every two weeks after this, you there’s feedback. Okay. I, I have, you know, Aaron Johnson, is our lead estimator. He is he is amazing. Just amazing. So great people. He’s super, detail oriented.

Andy: And of course, we learn from other modeling companies. You know what? How do you have a good estimating system? And you go back and you second check it and you double check it. and when it comes out where you don’t have slippage and if your production department knows that. Oh, by the way, the expectation is we don’t have.

Andy: So we just, you know, everyone’s on there listening and know, you know, you have to have a this.

Victoria: Right.

Andy: but the expectation is no slippage. And if the patient is that actually my production department has said this. Perfect. And so we usually actually have cribbage. which I can’t really explain, to be honest, except when we have great people order. So. So the idea of not being able to explain that.

Victoria: Just quality people. So obviously you must have a good hiring system. And people I imagine people are sticking around. They’re not you don’t have turnover.

Andy: Well, we’re sticking around. you know, we start with your mind, just probably like everybody might, we we are, we try to keep people. Yes. And that usually if they’re good people, they sit around and, everybody is really on the same page, you know, it’s teamwork. And, you know, we have we have, profit sharing where everybody knows they’re they’re going to get, you know, maybe 100 to 150 hours extra overtime and profit sharing, but nice.

Andy: So I think, you know, that’s what’s happened the last year. And last year we set out 150 hours. to each. Wow. Nice extra pay to each employee. And they are all on the same page about, hey, I’m part of this and we’re profitable. We’re in, reap the benefits too. So, I mean.

Victoria: Wonderful.

Andy: So that’s how everybody is on the same.

Victoria: All right. So one of the first things you said in this whole process was, you’re meeting cadence and you’ve mentioned a couple of meetings, so can you tell me what in a typical week or in a biweekly cycle, what are the meetings that you participate in?

Andy: Well, most of my meetings, I’m still the sales person for Riverside Construction, so most of my needs are sales oriented. I really do not spend that much time with department heads. we have like I said, we have, a every two weeks we have a leadership team, we call it there for containers. I mean, and so what I found was that happens every month.

Andy: plus so, I’m, I should probably do a little bit better job meeting with department heads. we also have, quarterly ratings. their the whole thing comes together, we report on how we’re doing, the Covid that things happen every quarter. But, we try to make that happen. So we have some cadences. I would say our most consistent is, is, meeting with my leadership.

Andy: Okay. So, we do not, as I said, I don’t micromanage anybody early. We just come together, they report to it. So everything you’re certainly. And you know, for hiring. I give them a report also what’s going on in sales and marketing income general manager type responsibility or what we’re doing and so forth. But that’s really our basically our leadership.

Andy: And then all my company department heads have meetings with their people. Okay. I’m really not involved in.

Victoria: So okay. That’s awesome. Yeah okay. Last question. Do you have any tips or or techniques that you can share on how you set goals, your yearly goals and budgets?

Andy: really we just we look at our three year plan and say we’re going and it’s never less well, I should say maybe one time I, we decided that we want our goal to be less than the previous year, but usually it’s 10 to 15%, 10 to 20% more. the main, you know, overlays, with some of the them or actually see them every year.

Andy: And so I would say that our, our main goal is to say, well, never be satisfied. You are one. Right. we’re always trying to, to grow just a little bit and not really. It’s not just about possibilities. Provide opportunities for more people. you know, you’re adding to your total or you’re trying to grow a single company.

Andy: you know, what do you say if I work myself out of a job? So we’re trying to hire salespeople and so forth. but the main thing is, something that I actually, called the 29th March, is don’t try to go too fast. For instance, don’t try to grow 30% off like we actually did in the last couple of years.

Andy: because, it’s hard to do. And, if you rely on a boss.

Victoria: Right.

Andy: Right. Just try to grow, you know, ten, 15% and, and that’s what we try to do. All right? Don’t overdo it. Save, stay consistent with what you’re good at. try to do know maybe four things that you’re really good at. you know, right now, we’re, we’re we’re starting a new brand division, and it’s going really well.

Andy: But, I have the general manager for that, and, and, and, we’re, we’re excited about that opportunity, but I’m not focused on that at all. So we just try to stay focused on, I know, and, so I guess that’s what I would say or goals I think directly involved with that also, make sure that they are okay with actually have them set their own goals for the year.

Andy: And then we have come together and we we decide together, really what should our goal we I think is my manager, he, he always seems to have higher goals. And I hear some.

Victoria: Of that talking.

Andy:

Victoria: And he’s part of the roundtable for production managers, isn’t he? Yeah, yeah. All right.

Andy: Great. Yeah. Good.

Mark: That’s great. Andy, we do one thing very consistently on this show, and that’s called the Lightning Round. Are you ready for that?

Andy: I suppose so. Mark.

Andy: And now here’s a reminder that it’s lightning round. It’s a track.

Mark: It’s okay. I’ll be gentle.

Andy: Thursday. I’ll do the best I can. I.

Mark: Okay. 60s on the clock. Here we go. What’s your favorite business book and why?

Andy: I would say that, you know, there’s really no boundaries. And educators and, we highly focus on what’s important.

Mark: If you weren’t of our model or what do you think you’d be doing?

Andy: And probably a real estate investor.

Mark: what do you not very good at?

Andy: And cleaning. Right.

Mark: Oh, this one should be interesting. Then.

Andy: staff from.

Mark: Your room, your desk or your car. Which would you clean first?

Andy: probably right. Yes. But, you know, I’m not very good at it.

Mark: Name a thing or possession of yours that you refuse to share.

Andy: Wow. Thank you for.

Mark: What do you think’s the greatest invention ever.

Andy: And the greatest invention ever? Probably smart.

Victoria: Pretty awesome birthday. I think back. All right. And it is. It’s been great. See, we made it easy, didn’t we?

Andy: yeah. Very enjoyable.

Victoria: Good, good. And you shared a ton of great stuff. Really? I love your vibe, you know, just good stuff. So. But before we let you go, I want you to share with our listening audience your five words of wisdom and why they resonate with you.

Andy: Well, my five words of wisdom, are her values and just schedule activities so. And why the why is there and is with me is, you know, our company is very value oriented. I get my book, I get my values, from the Christian, religion and I’m always trying to, you know, get my business ideas.

Andy: But then you also have personal values, and you want those really resonate. you know, people leave and we always think about how to be more intelligent or how to expand our minds. But, you know, one of my values is paying attention to my spiritual health also. And so that really is a key business. the, aspect that we’re really all we’re trying to cultivate, the whole person is Riverside construction.

Andy: We don’t talk much about those things, but, I’m always trying to figure out how can I, for instance, if I value people, how can I have lunch with with people? Or how can I have lunch with my team or have these conversations with people? So, values are important and then they really actually don’t know where unless you schedule those type of activities.

Andy: Right.

Victoria: All right. Make them important. Right. Shows are on your calendar. Right. Awesome. That’s wonderful stuff. Thank you so much for doing this. Tons of fun valuable good stuff Andy. Appreciate it. And, look forward to seeing you again soon. Summit at the summit. Oh, yeah.

Andy: Good deal. Appreciate it.

Victoria: All right.

Mark: Bye. Thanks again. Thanks.

Andy: You’re welcome.

Mark: I thought that was fun.

Victoria: Yeah, I did too. You know, I love the fact that he’s, following the four disciplines of execution. Because we had that, the author of that at one of our summits a couple of years back.

Mark: Yeah. Chris. Chris Christie?

Victoria: Yes. He was a ball of energy when they played.

Mark: No, that’s putting it lightly. Yeah. Yeah. Well, I love it when the speaker jumps off the stage and starts walking around everywhere. Yes. It’s good stuff.

Victoria: Yes. That’s a good book. I enjoyed that one, too. I liked his, the meeting cadence. you know it.

Mark: He did it. We did. For the year. Yes. Actually, after we gotta. We gotta get back into it, cause it kind of screwed us up a bit because everybody was home, and that that that’s an excuse, but it’s an excuse. Yeah. But yeah, we got to get back into that.

Victoria: Yes, for sure we do.

Mark: Lots of good stuff. You know what else I liked about what he said? He said that he whenever he gets a chance, he tries to hang out in, spend time with people. Yeah. Especially that part about going to lunch, because I’m kind of getting hungry.

Victoria: You’re always hungry. Geez, is it 11:00, kids? You’re hungry?

Mark: Well, I don’t know. I can’t help it. Maybe. Maybe I should stand to lose a few. Is that what you’re trying to say? Okay. All right. Okay.

Victoria: I have a few snacks in your drawer there. That could be.

Mark: Better. Yeah, I hear you. All right. That was really, really good.

Victoria: Yes. Finally. It took us a little while to get an idea on the show, but I’m glad. I’m glad we had him.

Mark: Well, you know, he’s so consistent with his work. It it takes up time. That’s right. So. But we want to thank Andy for taking the time to share all these awesome insights with us. And we want to thank you for listening. Week in and week out. I am Mark Harari.

Victoria: And I’m Victoria Downing. See you next time.