5 Keys to a Successful Home Renovation

Home renovation can be a stressful undertaking. It is wise to deliberate carefully about renovations. All disputes over the renovation plan must be settled before the work begins or you are just postponing an inevitable (and probably heated) argument. Everyone in the family should have a voice in this undertaking, as it truly is a family affair.
The following list could have had three, eight or even 20 entries, but if you stick with the basics and exercise self-control, the following five keys can help guide you to, and through, a successful home renovation.
1. Good relationships mean good business – A home renovation will be a lot less stressful if you have a solid, trusting relationship with your contractor. Trust doesn’t arise between people instantly, but there are ways to speed the process, such as “third-party trust,” meaning referrals. If you don’t already know and respect a builder in your area, ask the people you trust about the contractors that they trust. Get referrals, and interview the prospects to get at least somewhat of a “feel” for them. Get referrals, check credentials, trust your instincts – and call references. Nothing builds trust in a contractor like good, positive reports from previous customers.
2. Accurate budgets are crucial – You need to understand how to budget for the job, and what is really involved, financially, in your home renovation. The better understanding you have of your budget, and the more accurate the estimates you include, the less likely your job will exceed your expectations. Although your contractor can supply some good information here, you should maintain authority over the budget yourself and not give anyone – not your spouse, your family as a whole or the contractor – the “keys to your wallet.” Do your homework, and follow the budget.
3. Home renovation is messy – Prior to the start of actual construction, remove all valuables and breakables from the affected areas. Unless the garage is part of the plan, you might consider storing items there. If the whole house is involved, think about renting a storage unit. While this will cause some short-term dislocation and require some sweat from the family’s brows (or more paid help), renovations are inevitably messy and accidents will happen. Take whatever steps are necessary to ensure the safety of your valuables, fine furniture, Persian rugs and other possessions.
4. Stick to the payment plan – One easy way to ruin your relationship with your contractor, and slow down or terminate your renovation project, is to deviate from your payment plan. If you are developing a timetable for the contractor’s work, you should also prepare, and adhere to, a timetable for the payments. You should be proactive in this matter, and never allow communication to deteriorate to the point where the contractor has to ask for money. Plan out every detail and every dollar, and follow the plan.
5. Extras: There’s always something – When developing your renovation budget, leave some room for the unanticipated extras that inevitably come up in the course of a home renovation. In addition, once you start renovating, you may think of other improvements or changes you wish to make. This means building some flexibility into the financing, as well as the project plan and the timetable. Strike a balance between firmness and flexibility so that you don’t go off on a tangent and lose control of the cost or the schedule.
Like most big undertakings, a home renovation can be somewhat scary. Don’t hesitate to speak with friends, relatives, coworkers or neighbors who have been through the same thing. Investigate all concerns – listen carefully, take notes and don’t leave any question unanswered before finalizing your plan and your budget. Don’t be in a hurry, don’t make assumptions and, above all, do not waver in your determination to see the project through to a successful conclusion

Major Overhaul: Address Weaknesses in Your Business

Mike Majors was stuck. Back in 2004, Majors Home Improvement, in Milton, Fla., had produced an annual revenue of around $1.2 million each year for several years, but Majors wanted to grow the business. Since he wore all the hats — sales, marketing, scheduling, production, human resources — as well as lead the company, he couldn’t dedicate the time to make the sales happen. Then, a series of hurricanes forced him to make dramatic decisions.

“Because of the hurricane damage, leads were starting to come in fast, but I couldn’t handle them because I was handling everything,” he says. “I had to make a change.”

Know Your Limitations

Majors decided to add staff. First he identified his own weaknesses: marketing and selling. “I could close sales but that was ... because my name was on the company,” he says. “If I was serious about growth, I needed good salespeople.” He was determined that once he hired good people he would maintain the revenue needed to keep them.

“I never ran help-wanted ads because I don’t want people who are looking for work; I want people who are successful in their current position,” Majors says. He spread the word, and a mutual acquaintance introduced him to Jonathan Wells, then working in a local advertising agency. With an MBA and years of experience in direct-response marketing, Wells turned out to be a great fit.

Next, Majors focused on sales. Again, mutual friends told him about Chuck Mepham, another MBA who had proven his sales success in years with Sears. Today he is Majors Home Improvement’s sales manager.

Let Go

In 2005, the company grew to $3.2 million and both new team members earned significant compensation. Now that the hurricanes are a thing of the past, volume has dropped but is significantly higher than before Wells and Mepham joined the team.

It wasn’t easy for Majors to hand over control of two major areas of the business. “It was difficult to give the responsibility,” he says, “but I think that the fact we were so busy and I had so much to focus on forced me to let go.”

Majors still keeps his finger on the pulse of the company with daily lead, sales, and production reports, and his key managers have earned his confidence. “Now, while they may run some things past me, I trust their judgment and know that they are better at their jobs than I ever was. This confidence lets me focus on other important aspects of the business.”

Having choices is essential to business agility

The economy shows signs of picking up momentum, yet unemployment, housing values, and world events remain unsettled. Funding is still elusive for our businesses and our clients, yet banks are reportedly hoarding cash. We are seeing more activity than we have since the fall of 2008 (yes, the double meaning is intended), but will it translate into actual revenue?
Mixed signals and uncertainty create more personal and business stress than times of clear direction. Is it better to hold onto our cash and live to fight another day? Or is it prime time to risk investing to gain market share and get a leg up on our competition? We all have responsibilities — to ourselves, our families, our teams, and our clients — and investing in the wrong areas at the wrong times could spell disaster.

Finding Options

In times like these, having all my chips on one uncertain investment or direction is too risky for my taste. I like options. I want to seize opportunities as they arise, but I also want the flexibility to pull back if those opportunities lose momentum. Think “nimble” — a mouse dancing in the moonlight.
Diversified services. Options come from looking at our business as a “portfolio” balanced to suit our appetite for risk. Large, design-intensive renovations such as additions, kitchens, and master bedroom suites offer great returns in good times, but they dry up quickly when clients are forced to focus on need-based projects and repairs.
To balance this risk, we try to serve our clients regardless of project size. Our smallest project last year was $78; our largest was more than $700,000. We have also balanced our business portfolio by offering services beyond just home remodeling.
Variable costs. Options come from making our costs as scalable as possible. We have blended more independent contractors with in-house labor over the last two years. We are using more temps in the office to fill short-term needs, and we have outsourced more elements of our business, such as payroll, hosting services, and graphic design. Hedging our decisions through investments in variable, rather than fixed, costs allows us to be nimble.
Team effort. Options come from transparent communication with a committed team. My goal is to have the entire team on the lookout, not only for risks and new opportunities but for creative reinvention strategies as well. To achieve that goal, they need the authority to think creatively, which requires knowing where the company is heading and understanding the decisions we make. And they need to be committed — to doing what’s best for the business, to breaking out of traditional boundaries, to wearing multiple hats. Team members need to become “utility players,” adding value in myriad positions.
Every business is affected by forces that it cannot control — competition, the economy, even the weather. Effectively positioning around these externalities, especially in such uncertain times, is a competitive advantage. We are following the path of flexibility through options — a mouse dancing in the moonlight.

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