Bringing Commercial Precision to Custom Home Building with Julian Miller

Julian Miller, Director of Operations at NS Builders, shares how his experience in commercial construction built the foundation for his process-driven approach in high-end residential work. From implementing operational systems to maintaining craftsmanship, Julian explains why structure, communication, and internal efficiency are critical for builders looking to scale sustainably.

https://www.nsbuilders.com/

Introduction and Guest Background (0:00)
Impact of Commercial Experience on Operations (2:43)
Relationship Between Operations and Financials (4:59)
Operational Enhancements and Financial Impact (9:51)
Adoption of Technology and Efficiency Gains (13:53)
Profit Erosion and Internal Efficiencies (23:59)
Final Thoughts and Recommendations (29:30)

Find Our Hosts:
Reece Barnes
Matt Calvano

Podcast Produced By:
Motif Media

Transcript

0:00

Welcome to another episode of builders budgets and beers. Today we are joined with our good friend, Julian Miller from NS builders up in Boston, Massachusetts. Today's episode is going to be for the more operationally minded Contractors of America, the individuals that know how to get worked on a job site get product put up very efficiently, but might not have as strong of a comfort or confidence when it comes to financials, because Julie and I, we do back and forth in terms of the relationship with operations and financials and what needs to be done and some tactics to make this a nice, healthy, blended, harmonious relationship for any construction company. So let's go ahead and jump in. We'll get to it alrighty, Julian, we are live. Dude, super, super happy to have you on the show. Thanks for jumping on. Yeah, great to be here. Reese, always a pleasure. Awesome, awesome. Okay, so for the listeners today, we have Julian Miller. He is the director of operations for NS builders. Before I just tell everybody your background, Julian, go ahead and fill in the gaps and let the listeners know who's who's going to be talking to him today. Yeah, I've been in the construction business for close to, like 14 years now. Started out in commercial doing, you know, super large infrastructure projects and laboratory buildings, multi family stuff. Fast Forward, got burnt out in the commercial sector and wanted to pursue the high end custom home building worlds, jumped right into a custom builder locally in Boston, my wife and I ended up moving to Northern California. Was lucky enough to land a really cool job out there and learn some pretty amazing things, building like 20, 30,000 square foot homes, you know, super high net worth clients. And then, you know, here we are, back in Boston, moved back to be closer to family, and now working for Nick schifr at NS builders. And it's builders been in business for 11 years now, and we're doing kind of a variety of remodels, custom new builds, but definitely on, like the higher end of the spectrum, totally primarily in the Boston Market, and a little bit north and south of the city. Too. Beautiful, beautiful. Okay, so I hear this trend often. You know, it's not uncommon that guys will get into, like, residential building, typically, like the higher and stuff, with a little bit of a background in commercial. Now, just with your I was, like, the first call it, what, 10 years of your career, less than, less than commercial. Six years. Yeah, six years, the first six years of your career, yep, excuse me, um, you are in the commercial world. How much did that experience impact your operational mind, we'll call it, or at least, like your practices that are important to you. I mean, 100% to be honest. Like commercial world has a ton of red tape. There's definitely a lot of cons, I think, to the way that they build ton a lot of consultants, so many people that are, you know, touching a certain part of the project. But I would say that the benefit of of that experience was the organizational structure systems that were defines that were, you know, fairly efficient, that, you know, the teams, at least in regions, were locally, following the same patterns. And so that that kind of got instilled in me, definitely a type A personality and like, I gotta have organization and structure, and that obviously lends to, like, my position today, totally. But yeah, it's played a huge role in what we're doing here at NS builders. And, you know, trying to be forward thinking in terms of the new technology that's out there, both for financial but you know, other tools for takeoffs and 3d scanning, starting to do some pre fabrication off site as well. So lovely. Yeah, massive. I love it. Totally. Okay, so, and that makes all the sense in the world, right? I mean, you've got, like, infrastructure projects, large buildings, you've got dozens, hundreds of trades working all in the same time, multiple people have a hand in it. It's got to be process oriented. It's got to be like a tight operational motion for it to make sense. Yeah, go ahead. No, there's, yeah, you have less room for error when more people are involved. Maybe that's like, a little ironic, but there's, you got to have those checklists in order for things. Is to net, the result that you're you're shooting for, there makes total sense. Makes total sense. Okay, so, and with that said, like net, the result that you're looking for, I want to focus on, obviously, with the nature of the podcast being around project financials, I wanted to hear your take on the importance, or, I guess, the relationship, rather, between operations and finances, because we talked to a lot of builders, and obviously, like, through the lens of adaptive, it's an automated AI tool that's, you know, taking a lot of the manual data entry, and there's process efficiency gains, but it's really more of a like an accounting tool. But we see a lot of operations people get excited about seeing adaptive Okay, so from your standpoint, being the Director of Operations, heavy background and commercial, what would you say is, like the most important component, or the most glaring relationship between operations and financials? I think it's there are so many manual processes that are kind of like, put in place, I think across the majority, or a lot of the residential custom builders, you know, it starts, starts with the trades. Lot of guys are owner operators, you know, it's not necessarily their fault, but they don't. They don't have the overhead to to be able to hire, like a bookkeeper, somebody who's managing their invoicing process. So it can be cumbersome to get invoices from subcontractors, which is mind boggling to me, right? You want to get paid, but you know, you spend it all comes down to you spend a ton of time trying to track down the correct information, you know, you're trying to align it with maybe a schedule of values that that you've developed through a contract with that sub right? All of that information, you know, comes to you, you're inputting it to, you know, whatever software you're using, and eventually it's making it over to the accounting team and being able to streamline, streamline that process and make it so, you know, perhaps it's you're you're buying something from your local lumber yard, and you make that purchase with a credit card. Hey, I can just take a picture of the receipt uploads to in this case, you know, we're obviously utilizing adaptive. Adaptive quickly is recognizing what job it's for, maybe making a recommendation for how to job cost it within that specific budget, and then boom, it moves into the next sort of flow of review, and then that gets populated into an invoice. But in the past, I think a lot of that, even still today, a lot of those purchaser purchases are being made, and people are losing the receipts. You know, you you forget what job it's for, because maybe you're running multiple jobs, and then, right, that's easily translated to lost revenue, and nobody knows the difference. And then, you know, it translates to, well, how are we tracking this in our books? Like all I'm looking at is our our gross profit, you know, is much lower than we were expecting it to be. How could that be? So, you know, obviously, it's, it's a big network that ties together, and I think you got to have harmony between operations and financials. Otherwise, you know, you're, you're going to have a really hard time being successful totally well. And I think that's even like with the so that was perfect. I mean, from an operation standpoint, typically, what I see is, like, operations are typically people, like in the field too, right? Like, operations are looking at project managers, and they're making sure that, like, sub inventor relationships are at navigating and, you know, the projects they're moving along appropriately. And I think that's typically like, where the disconnect happens is it's like, Look, I'm just a project manager, or I might be a project manager that's might be stepping up into more of a leadership role, and it might be titled as, like an operations person, and understanding that yes, you're getting an invoice handed to you in the field, or you're having a subcontractor email that invoice to you. Like knowing that the flow and every step of an invoice sitting in your inbox for a day, two days, three days, longer than it needs to or gets lost is going to be impacting, you know, due dates on bills or terms for early discount fees or even just getting that individual paid, yeah, in a timely manner to maintain a relationship. It's all hand in hand. So I see a lot of builders and operations people, they're starting to get more interested in, like, speeding up that process as a whole. But there still can be, like, this disconnect of like, it's gonna get paid or it's not that big of a deal. So. Like, where would you say you've seen, like, the biggest benefit or impact coming, like, considering your background, even adaptive aside, if adaptive was in that play. But like, what have you seen, like, the biggest operational enhancements that you guys have made, and how has that impacted financials? Yeah, I think you know to start from the top. We we pay the majority of our subcontractors electronically. So okay, if again, go back to adaptive like for we connect all of ourselves within the ACH payment. Truthfully, like, that's huge. Occasionally, we get a little bit of pushback from subs. But you know, the amount of times that people reach out and say, hey, you know, I haven't received that check. It's been three weeks. Go off in the mail. We got to send it again, and you know, it was missing the signature. It's brutal, if I don't ruin your train of thought here, do you want to keep going? Go for it, because I do hear that like, bizarre, but it's like, like, the construction industry is married to a check. Yes, not, not money, the check, yeah, the physical check, yeah. Why is that? Why? I don't know. Man, I literally got a text today from a sub who said, hey, you know, been having issues with checks showing up in the mail. I can just stop by your office and pick it up, and that's okay go. I mean, it's just, like, drastically inefficient. It's like, you're gonna drive, you know, maybe an hour out of your day to come and pick up a check and then go bring it to the bank and deposit it when you could be, you know, on a job site, doing an estimate, whatever, anything other than freaking picking up a trip to pick up a check, yeah, well, and so why did, why don't? Why isn't that normal? Okay, like, I think that's like, okay, that's it's obvious, or it seems obvious to us, but why isn't that obvious to everybody, what's the disconnect? You know, I personally, I feel like it probably has to do with a generational imbalance. Okay, like, okay, you know, not, not to rag on, on the old dogs here, because those are the guys. Yeah, a ton of experience. But, you know, it tends to be those companies who've been in business for a long time, they've been doing it one way. They don't want to mix it up. You know, there's like a fear of being scammed, you know, which is totally reasonable. Sure there's also, you know, maybe they've already signed up with a couple electronic payment systems through other builders, companies that they work for, and they're like, I've just had enough. I don't want to have another freaking login. You know, send me a totally, totally. That's, that's truly the only, the only thing that I can come up with that would validate receiving a physical check as opposed to doing it's like, when, when you get paid, you probably are getting paid through direct deposit. Like, imagine if your employer was like, Oh, I mailed you a check, but you're actually not going to see it for two weeks, dude. I don't get intolerable. Like, there's, there's no way that would be tolerated. Like, in our world, I just, like, I would be baffled. I'd be like, What? What? Yeah. But it also goes back to like, okay, so generational, sure. I get it like old dogs, new tricks. Cut me my check. It's in my hand. I can feel it. I get it. I was raised by one right? But the other side of this too is like, do you think they understand the cost associated? Like, if you just, like, broke down where some of these, let's just say that a sub is in I don't know. What do you work with a southern Gloucester? Is that how you say it? North Shore? Yeah, you nailed it, sure. Gloucester. Okay, great, yeah. Okay, so let's say we've got trim carpenter up in Gloucester, and he's going down to white oak and Wellesley, right? What's that commute look like? What's a Gloucester to Wellesley commute at five o'clock on a Friday? Look like, oh, I mean, hour and a half, two hours, maybe would trap one way, or round trip one way, like, one way, yeah? Okay, you get, you know, smoke during rush hour easily. What about the Wellesley to Gloucester? Yeah. I mean, it depends on, like, the same morning or day, but people going out of the city, 100% right? Okay, so let's just say, hypothetically, trim carpenter, yeah, in Gloucester, right? That's where he resides. Cute, little family, healthy, little business going on, but he's down in the city, and he's got a couple of projects going, and he's like, damn, I gotta get paid by Nick and the team. So he's gonna drive over to Ms builders. Where do you guys? Where are you seaport? Where's your office? Yeah, we're right in South Boston, seaport area, beautiful. So he's making his way down to South Boston, and call, like, half an hour to get there, and then he's got to get all the way back to Gloucester, and it's an hour and a half, but he was already going to go there. But if you start looking at the cost of, like, if you could have just gone from the job to home, and you cut an hour and a half out on a weekly basis, not even including the fuel, which, of course, you're going to expense, right? A business expense, but it's still time. It's like, Yeah, dude, that's a that's $100 call it. Let's say you're $100 an hour guy. That's $100 by multiple jobs that you might be doing too, right? You know, totally hitting up the other builders. And, yeah, doesn't make it's insane. It's insane. And then you think, and it's like, dude, okay, I get it. Like, maybe that's your podcast time. Maybe you enjoy it, sure. But dude, you could listen to a podcast in your recliner at home and still have money in your account. It's just crazy to me. So Okay, no, that was like a totally a side tangent, but it makes a ton of sense from an operational and finance standpoint, like just speed of payment, speed of payment, cutting those steps out internally. What does that look like for you guys? Like, what did that look like before adaptive or any ACH product? Like, what would that would it be like checks, printing them, signing them, someone at the desk? What did that look like for you guys? Yeah, we so we've always kind of used a either a fractional accounting team or someone who's been remote, okay, and so, you know, we had to use bill.com at one point in time, sure. And so that bill.com was was cutting chef checks from like, a random location. And so it was being managed by the financial team that we had. I think I'm sure at one point, Nick was probably cutting checks and physically, like handing them to people or mailing them out. But, yeah, that's that's no longer the case. Like everything runs through adaptive, and I would say 99% of our subs have signed up. And, yeah, super easy to like track, and you can, you know, send them a snapshot. Hey, this hits your account. They also get a notification, you know, they can see when it's coming. So, you know, I think it's peace of mind for them. Cool. Okay, so you guys have almost just been like, and I knowing you and Nick over the years, like you guys are very forward thinking, like, very tech driven efficiency process type people. So that makes sense. Okay, so I think, and before I cut you off, I wanted to stop you, like, I didn't want to ruin your train of thought. But there, I think there was a second piece that you were going to be talking about, getting subs paid in a timely manner, is like, a huge one for you. But was there, I think there was another piece that you're going to dive into, yeah. I mean, I think like so so we use Procore to manage all of our project documents, but also the financial side of of the business right now, and we really like that, because it's, it's it sort of houses all of every project, subcontractor, Po, vendor, whatever you want to call them, their cost of work. You know, we're managing change orders, both with a client and the subs. And then ultimately we're we're connecting with adaptive and they're pushing direct costs, essentially the receipts, back and forth, and we're running all of our invoicing through Procore, excuse me. And then that gets connected to QuickBooks Online, essentially, and and sent out to our clients. But it's the reason why we've decided to do that is because it's keeping everything in one location and so totally again, going back to that efficiency discussion, and from an operations perspective, our project managers can go directly into, you know, each project that they're they're running in the Procore, they can see what is the current live health of every project across the board, based on the budget, you know, where they're at in a current invoice cycle. And that that communicates directly with our accounting team. So, you know, gives the accounting live look at, you know, what's our current AP accounting is communicating to us. Hey, you know, we just received payment from so and so client like, are we good to pay these guys? And we can go through that list pretty quickly and check that off as, Yep, good, totally, low or not. So yeah, we've, I feel like we've been able to develop a pretty robust and streamlined system at this point, totally well, and I think so there's obviously Procore is, like, a very popular tool. It's, I would call it more uncommon for, like, residential builders to be on Procore. But like, let's even just like Procore side brand aside, right? We could say builder trend, job tread, Rezi, oh, co constructive, for the builder that's out there. That's like, I don't understand the benefit of like, going to from an operational like, bridging the gap between operations and financials, and that bridge between software doing it, what would your like point be to them to say, like, you've got to get on software, like you can't do this in Excel, you can't do this in whatever. What would your point to them be? Yeah, I think, I think it's like, it's pretty simple. It comes down to, do you want to have a true look into your profitability? I. Like, let's do devil's advocate. Let's say that they say they do, what are they missing? Well, you could argue, okay, you're, you know, you're manually entering the majority of your information. There's, there's got to be a percentage of of air like, human error that is happening, sure. Spreadsheets, uh, equations, whatever your formulas should have. And, like, we've all been there, right? So, like, Yeah, I think it's really you got to be careful that if you're solely going to rely on that. But it comes back to efficiency and time, right? Like, you're, you're entering this stuff one by one, as opposed to maybe entering it once and then it's pushing down the line, essentially, and in populating that information in multiple places, totally, yeah, having having a true look at your your profitability, you know that that obviously can lead to, hey, do I need to hire somebody? Do I have the cash flow to be able to hire somebody? You know, can I, can I issue bonuses to my team if, if I have a team, you know, what? What are the company goals like, how are we tracking the metrics? You know, it's just, it's creating a database for you that you can make long term decisions that are, hope, hopefully beneficial to your company, totally close to living sort of in a vacuum and looking at high level every day. Sure, I always, you know, just coming from builder trend, it was always more of like, like a framework, right? It's like, it provides a framework and a visibility into your business. But I think it also it starts to, like, break out the team, right? Based on who needs to be, looking at what function. That makes me think of I think Nick had a post recently about you doing a stand up for your team on a job site. Are you familiar with what I'm talking about? Yeah, you might do this all the time. Yeah. Yeah, yeah. Nick, Nick's point was something along the lines of, like, he's like the visionary, like the like, the the Forward Thinking guy. You're much more like the day to day operations side of things. Like, would you say that, you know, with products like adaptive pro core, whatever, that allows you to focus more so on your niche. So then in those circumstances, a monthly stand up, you can have the information that you need towards Nick, he can have what he needs. Are you tracking? Yeah, yeah. 100% I think it's directly correlated to scaling your business, right? Nick. Nick is able to kind of, like, maybe peel back a little bit and not be in the weeds day to day, like, that's that's my role. That's what I'm getting into. But then he writes the ability to zoom in on each project, because all of that data, financially on each project is is getting populated daily in some way or another. And so he can, he can look at all those and get a sense like, Hey, are we should have hitting the fan or, or things going well outside of just sitting down with myself or Tim our controller? And, you know, trying to decide, like, are we having issues on projects or or not? Save saves him some steps well. And I think that probably goes like, you bringing up, like, the hitting the fan comment like, that happens a lot in construction, right? A lot of fires need to put out for sure. And would you say that? Like, I think efficiency is one thing when building, especially like, through the ones adaptive. Well, I've already got someone that's doing this. What's the time savings on this? Actually? Is it that important? Like, the work's getting done, but the efficiency of having information to make decisions. What's your take on that? Like, sure, like, we're saving time. Like, sure, we're saving the trim carpenter from Gloucester, from having to drive, yeah, the city right, to pick up. But that's like, even more so is like, dude, the immediacy of information to make better decisions is a huge one. We call it profit erosion. But do you have any thoughts on that? Yeah, immediately, what comes to mind is like, have being able to have that live look at a budget, right, right? And maybe a client's like, Hey, how are you know? How are we doing with our budget? Like, we try to provide, like, monthly kind of updates. Here's a look. See. Here's where we have savings. Here are some overages, etc, whatever. But if a client in passing is, like, which has happened, you know, hey, do we have any savings left on? Like, the cabinetry, line item? Like, we didn't, we didn't do a certain scope. Oh, I'm not really sure. Let me, let me look at it. Get back to you. Like, okay, now I'm realizing that I didn't process like an invoice or receipt, and it's not value. I mean, you could communicate like an entirely incorrect value or right, or you start building assuming that you have this extra cash that you don't right. Essentially, yeah. So, yes, 100% Well, I do okay. So that's what the client lens, right? Like and like, luxury building, like, brand is everything, right? Brand, quality of product, like, all that stuff is like, Pinnacle. They're like, they want a great experience, right? But even internally, right? Like the profit erosion side, you'd made the comment earlier of like, if you're not taking pictures of receipts or you're not tracking costs, you just use the example of, did I invoice them for AP that we had? Yeah. And like, is it showed up appropriately, right? We do? We have a partner down in Dallas, Chloe Brown, wildest dreams consulting. She does, like operations and like financial consulting, she did a case study using adaptive she was able to uncover $5 million and unbilled cost Wow, from one of her clients. And that was like, over the course of, like, whatever his career business or whatever that's that's but insane, but it's insane, but do when you think about it, is it like if this guy's doing 10 million a year in revenue, Colin, right, he's been doing it for 10 years, right? That's 5% right? That's like, not that crazy. And like, when you're thinking about, Okay, we've got $20,000 invoices, $10,000 $5,000 invoices. We've got $25,000 in credit card receipts a year, right? That could be a quarter, right? But whatever you get my point, yeah, right, the bleeding internally is so brutal. Do you have any like, real time examples on that, or any perspective around that? Yeah, for sure. I mean, even before we were using adaptive, like past systems that we're capturing, using receipts as an example. I mean, I would probably say that there was, like, five to 7% of charges that maybe they just weren't being job costed correctly, right? Like they just ended up in this random bucket. And, you know, you you would go through, like, we call them missing receipts, essentially, at the end of the year, you're like, how come none of these made it into a job cost? You can't go back to the client and be like, Oh, hey. Like, forgot to bill you for this. Like, project's been done for four months. I mean, maybe, but, but it goes back to brand reputation, right? Yeah. So it's like, if egg on your face to go back to because, like, let's say they're buying an NS product, right? Call it, like, a three, $4 million product, right, right? And you go back and you're like, hey, we actually uncovered that. We didn't bill you for 15 grand. Like, can you, like, stroke as a check? They're like, I just bought a $3 million home from you. You should be getting this. No, I'm not. Yeah, right, yeah, it's crazy. So, yeah, I mean, there's definitely many examples and even even sub invoices that get sent to, maybe it wasn't the pm it got sent to, you know, another person on the team and got left in an inbox, or they were on vacation, whatever, right? Like, there's no centralized place for those invoices to go no clear contact to find that stuff is going to get missed totally, and your profit erodes. Profit erosion, baby, profit erosion. Um, dude, yeah, no, I think, like, obviously, like, just to kind of like recap here, like paying subs for sure. Like, I'm I'm bullish on that. I think it's like a very low hanging opportunity for builders to adopt very low friction, whether it's adaptive or any other product for that matter. Like getting to ACH is advantageous for both parties, more immediate pay, better relationships, more clarity, better documentation, less fraud risk, right? A lot of that stuff. But I'm more fascinated with, like, the internal efficiencies the process gains. Because I think a lot of people, they get sold builders, not just people, builders, get sold a lot of software that's going to save them a lot of time and a lot of money, right? And then the builders always stuck there, like, what is this actually saving me, right? And you start to think about the internal intricacies of, okay, we might be like cutting someone's hours in half of doing this. That's exciting and fun, but the slippage to be to use a construction term, yeah? So in cash, what's what's that super technical? Yeah, exactly. But you think about all the stuff that you miss and you and that's where it's like, those are big numbers. And a lot of guys, they just, like, chalk it up the cost of doing business. And it's it just doesn't have to be that way. Yeah, no doubt. And I think, I think one of the like things that people either they don't appreciate or they don't recognize, is, like, regardless of what system you have, I don't care, like, how efficient it is, you got to put in the time to set it up for how you operate. And totally and it's never easy to make a transition between softwares and, you know, flip your operations upside down. But. Worth it. And once you have a system, you know, especially for us, as we continue to grow and we hire more people, you know, we we do have standard operating procedures that are ever changing and growing. But you know, the steps of how we operate from a operational perspective to financial perspective are written out pretty clearly, and that makes life so much easier, where you can basically hand somebody a playbook and say, Hey, this is how we do things. You know, spend some time working through it, and then we can dig into the specifics together. Yeah, would you? And I think this is about and we can wrap this up here, but I think that was just kind of a fascinating note to end on when you talk about because moving the software can be a nightmare. Yeah, I will do a little plug to adapt. If it takes easier, takes less time to set it up than it does to buy Wink, wink, but it's really easy to set up. The point is, is like, how much of that is attributed to the processes that you guys do have outlined? Like, let's say you guys moved from Pro core to insert product, sure, right? Is that, is that documented process making it easier for you to move products? Is that what you're suggesting? No, I think I'm suggesting like you find a product that is appealing or enticing to you. Then you, you know, essentially agree to go all in, commit to it, yeah, and then, and then you work through it, and, like, you've you figure out, okay, there's some kinks here, and this is a little weird. How do we make that better? You know, just another plug for you guys. Like, you've been super helpful. The adaptive team has been, you know, very responsive, getting us set up and working through like, little nuances that we've had. But, yeah, I think I don't know if it's necessarily like, Hey, here's a playbook. This could apply to any other software, because they are so different, and there are certain restrictions depending on what, what, of course, but, but at least, like, it gives you a roadmap for how you know, if you want to look at this high level, like how payments should get processed, and who the players are that are essentially involved in that process, that's you got to start there, right? Yeah, exactly. So, beautiful, awesome. Well, no, I think this was great. Julian, I appreciate you. I think this was a good episode, just in terms like talking efficiency process, some of the big wins that more operationally minded individuals can consider and the relationship to Financials. So I appreciate you, dude, you bet, man, thanks for having me on. Of course, enjoy the rest of your week, too. Ta,