Fixed Price vs Cost-Plus

Victor Rybak shares how he moved from “bags-on” to building systems that protect profit—covering fixed price vs cost-plus, change orders, retainers, and allowances that don’t burn you. He also breaks down the House Pro workflow for bids, selections, invoicing, and job-cost clarity so builders stop giving away work and start pricing like a real business.

https://simplyhomebuilders.com

Show Notes:
0:00 Welcome & why this show exists
4:46 From bags-on to the office—why Victor changed lanes
7:29 When the market shifts, profit needs a plan
9:41 Stop the freebies—write the change order
14:56 Retainers & contracts that keep you covered
18:35 Job costing clarity: “I paid $32k… but for what?”
22:06 When cost-plus beats fixed price
26:55 House Pro workflow—bids, selections, tracking
32:17 Centralizing invoices & communication
51:04 Standardizing process so chaos settles
55:14 Closing thoughts & what’s next

Find Our Hosts:
Reece Barnes
Matt Calvano

Podcast Produced By:
Motif Media

Transcript

0:00

Welcome to Builders, Budgets and Beers. I'm Reese Barnes and I started this podcast to have real conversations about money in the building industry. The wins, the mistakes and everything in between. I believe builders deserve to feel confident about their finances and that starts by hearing from others who've been through it too. This industry can be slow to change, but the right stories and the right tools can make profitability feel possible. Let's get into it. Mike Shaw, we're live. We're rolling. We're rolling. um Dude, Victor, I appreciate you jumping on. If you listen to Builders Budgets and Beers, you know that I like to start off with having the guests introduce themselves and give the listeners a little idea of who they're going to be listening to today. So go ahead and give them a little intro. Yeah, so I'm Victor Ryback. I'm right in the heart of America in Lincoln, Nebraska, just pretty Big Red, baby. Go Big Red. Yeah, go big red. We're about there to start. So, you know, the typical Nebraska thing. Hopefully we're better, right? I don't know. Rolls got a he's got a tall order. He's got a lot of excited fans, a lot of optimistic fans. uh Yeah, no, he's definitely got his work cut out for him. There's no doubt about that. um Honestly, it's a great environment though. That's one thing is through all the years, the ups and downs, the environment of the fan base and around the Huskers has been phenomenal. um So great thing to experience, not huge into football, but damn is it an experience compared to, you know, any other games I've been at and I've gone to the chief games and everything like that. doesn't even compare. Victor with the hot takes and the scurs have a better game day than the Chiefs, huh? yeah. And I don't even pay attention to that stuff, but you're going for an experience. Definitely a fun time, fun time at the Husker stadium there. That's right. But yeah, I've been, other than that, I started building homes in 2019, kind of come from background of builders and, you got my dad builds, my cousins, my uncles build homes, all here in the same place. Really have a huge background in it growing up. Helped out from a young age, going to the job site, loved it from day one as a kid. Always was intrigued with everything construction. knew in high school, was not going to college. I knew that wasn't for me. I knew I was going to be doing something with my hands or around the industry in one way or another. If you would have told me it ended up in an office, I probably wouldn't have gone this far, to be honest. But honestly, I've grown to love even this part of the business. Seeing that early on excitement from my clients and bringing their story to life has been awesome. Honestly, as I've been perfecting the administrative side of things, it's been helping a lot to make that enjoyable for me in one way or another. yeah, we just focus on building from the ground up some really nice damn houses. I don't care what the price point is, it has to be built right. That's my thing. love it. That's perfect because I think... So do you listen to Biller's Budgets and Beers? Yeah, pretty often when I'm not listening to one of the books, I gotta, you know, keep filling my head with keep developing and expanding. But the podcast is great for that too. Where you get a bunch of little nuggets from somebody else sharing their story and their experience. Totally. The reason I asked is because I just did an episode. And actually, I'm a moron. We haven't even released it yet, but it's going to be coming out, so you should listen to it. It's with Gabe Joseph. And just your story of being like generational, right? Come from a generational background in home building and construction, right? You were a bags on guy, like very much like trades, wanting to get out there, execute the work. um And then you ended up falling in love with more of like the business side. I think that's a conversation and a part of the journey that a lot of builders, well, maybe not as many as we'd like to say, but a lot of builders do find themselves coming across. It's like you didn't think you'd be sitting in an office and having to manage cash flow. You didn't think you'd be in an office trying to do all the logistics and supply chain on materials and procurement, lining up subs and making sure everything's going. um But it is something that you do fall in love with anchored around delivering a quality product to the customer. Yeah, yeah, I mean it kind of all comes back full circle really I mean Obviously I'm gonna be putting somebody in place for that to handle the day-to-day kind of make sure we're staying on top of everything um But I'm huge about understanding everything that I do and every portion that Our company does I got to understand it to a degree. I'm not gonna be the one doing it but I am gonna understand it to a point to where we can fill in and we can take over. So I understand how we need an improvement. So when somebody on our team comes to me and says, Hey, we need to do something better. You know, I can be on board. can understand their point of view. can understand their pain points to kind of better, you know, alternate and really adjust what our course of action. Totally. That's one thing I've been pushing for recently is developing our process. And, you know, that's how I came up on, you know, adaptive and met you and kind of went from there. But I mean, that was a critical role to understand, Hey, we got a pain point in, in our finances. Yes, we use QuickBooks online. QuickBooks online. Yes, we use, you know, a way to track our hours with BusyBusy, which is another great platform. But we were lacking to see that day to day heartbeat, so to say, of our individual jobs and knowing those vitals. And so this has really been a huge undertaking to do. But it gave me an opportunity to learn something new and understand it and be able to create a process for my team to follow as we keep expanding and growing. Totally, totally. And before we went live, before we hit record, you had mentioned that you guys are coming across a pretty exciting time in the business. Sounds like it's picking up. Go ahead. Yeah, so we slowed down to kind of really slow down to really pick the pace back up about 24 months ago, I say. And really was, we were doing great. mean, we're selling spec homes even in a slow market. We were, you know, making profit. We're a really small team. Still, still are relatively small. I was just going to take the business with the approach to be essentially recession proof. is that even though we were still making sales, weren't sitting on the market nearly as long as others were. We were really successful in hindsight, comparably to anybody else in our area. But wanting to be client focused has always been a huge drive of mine. And then trying to be recession proof was what really got me down that path. And I started looking at possibly turning back over into that full custom tailoring to somebody's needs. And so started pulling back the reins, did, you know, pull back of how many builds we were doing, which in of itself is a challenge, obviously, because you're used to one set of cash flow and a certain revenue you're going to do every year. so pulling back comes with its complications. But building out those processes of have now been implemented really this year and are really taking full force. And we're seeing a huge change come quarter three of the amount of leads coming in, the amount of jobs we're doing. We're really back up to where we were two years ago and the amount of starts we have per year. And that's huge. And now I can plan accordingly going forward that, next year we're looking to do 8 million and the year after that 12 million, the year after that 18 million. I can say that with confidence because I have the process in place to do so. I know that I've improved my net profit. So seeing that day to day, I can see very early on in a job that crap, we're a little upside down on this. I can't be... given take situation anymore with my client, even though I will help them understand and help them understand the change orders and all that, I might not be so open to giving on the financial side of things because we don't have it anymore. Let's do I want to hear like I want to hear some details on that. ah So like at the point like here's like an example. If you have a project where like you have to obviously share names or anything like that. But like when you recognize in a project, how early do you recognize in a project that you're going to be upside down or that you could be upside down on? earlier in the project, uh I would say a few years ago, I would recognize that. probably around, I would say the drywall stage. And now I could see that with different softwares, m with better takeoff software, with better tracking, I could now see that today. mean, I could, you know, if there's been an alteration or something off, I can see that pretty much daily now. Yeah, but who cares, right? Like at drywall or in real time, like what's the difference? What does it matter? Usually there's still good amount especially when you're doing a build for a client specifically or say maybe I like I've had a spec cell during framing stage where you sit down and it's like hey Can you just go ahead and include maybe a set of deck stairs? know, like you know what? Yeah, I know that's probably gonna cost me safe $4,000 roughly to build those set of stairs You know, it's like what the hell yeah, I'll throw it in for you. You know, it's like I got on the top end, you're thinking you're fine. So you're like, I got a little bit of retainer in there. These clients are pretty understanding. I'm going to work with them. I'm going to drop that in there, kind of help them out. Or you know it's going to cost you $4,000, but you're like, you know what? We'll do it for $3,000. It's worth the deal to kind of keep the customer happy. When you know... day one that you're upside down or that you're not meeting that profit margin that you should have, then you already start pulling back and it's like, leave it or take it or leave it. It really helps you make those decisions properly, I guess, the way you should be doing them. uh But to me, being client relation focused is kind of why I'm always negotiating. You know, aren't we all right? uh that's the thing is like my clients like I you know, it's a take it or leave it number but you know, if we're if we got our margins built in and a client's asking for a little bit extra, I'm not going to mark that up at the full rate, you know, like there's no reason for it. m Now, if um they're just being rather difficult and I know I'm going to do these stairs and I'm going to have an additional 10 phone calls and complaints from the client, then I'm just gonna hit it where it should be and be done with it. But having those numbers in front of you daily is critical for those decisions um to kind of help that. I I'm fixed price. So like for me, my clients don't see those numbers. I've done two fixed price contracts. I wish I would have had it back then. It would have made my life way easier at that point in time to get those daily receipts and everything in there and have that weekly update for the client to be like, here we are. You you came over, your decisions put us here. And it would have been a lot easier to track because recouping some of those costs are very difficult three months down the road. And with the fixed price contract, very much the same. I would have had time. So a great example is I had a change order that should have been implemented for plumbing selection and I wasn't using adaptive at that point in time and I should have left an opportunity to have the clients reselect their items. Or, you know, write up a change order. Well, I didn't have that side by side comparison. So I got the numbers from my plumbers, looked at it, figured what the hell, that's not all that bad for the finishes there. Threw that in, said, you know what, go ahead, rough this thing in, let's keep going. Well, and I got my numbers back and I pulled it all together side by side at the end of the month. The problem was, was we were $6,000 over. And not a large sum per se, but now you just gave up everything you really had to wiggle with in one go that the client doesn't even know that you did for him. You know, they know that was a $6,000 overage. So it's not like they could even be appreciative of the fact that you did that. And to go back three months later and say, Hey, we got this change order. You know, they weren't married to those selections. That's where they were guided when they went to the show. Totally, okay, so two things on that. So the first is like knowing your numbers in real time suggests confidence, which we'll talk about that a little bit. But the piece that I wanna know about just immediately, which I feel like might be quick is like, what is this like negotiating, haggling, wanna like, like I'm gonna do the client a solid, but they don't really know it's a solid. Like that just doesn't, I understand it from a wanting to keep them happy. But there's like never a chance for them to be appreciative towards it. It just doesn't sound like a good idea or a good business practice to me. No, it's definitely not. agree. Why do people do it? Like, that's just insane. Why would you do that? So it's it, I would say it's a bad habit that followed me from early on experiences and something that I'm learning to get rid of and change that habit slowly. Um, again, knowing my numbers live is helping with that confidence. So, the other thing is being fixed price, it's a ticket or leave it number. gives me time to go to and go back maybe pull up data from now adaptive, compare it to my original takeoff, see in what percentage I was off, adjust my numbers and go back and say, hey, I'm not doing this job anymore. At this number, I'm going to mark it up a little bit more. I'm adding a little bit more to my plumbing, to my electrical package, because my receipts show that. And when I go back and present that to the client, it's a take it or leave it number. when they want to negotiate, now my negotiations are, well, let's not do a deck, let's not do a cover deck anymore. You need to shave this project of yours by $80,000. Here's 10 places you can do some. know, if you want to part with your deck or you want to part with, you know, maybe your composite deck and go back down to the good old cedar and, you know, maybe some green treated, whatever you got to do, you know, maybe you're not finishing your basement anymore. But those things now I can see early on and having that data there helps me from the very beginning kind of kick those habits. Totally. So I was going to say the clients now, mean, the ones that the one where I do still kind of catch myself is where again, I'm not tracking it, right? So I'm just in a general conversation with the client and I, instead of holding my tongue back, knowing that I'm so confident in my numbers, I'm like, this is going to cost X amount of dollars. Well, now I'm committed to that, you know? And so, yeah. I, you know, if I would have just kept my mouth shut and would have said, yes, we can definitely price that up for you, which I'm trying to implement now. And so that's, you know, it's like, you know, customers always want to hold you to it's like, well, you've been doing this for so many years. You got to know your numbers. It's like, yeah, I my numbers. But guess what happens when you do math on the go, you forget about the LVL beam you're supposed to put in above that door you just quoted. That's all I use examples like that and say, yeah. I'm not thinking, I'm not in the mindset of estimating right now, so I'm not gonna price you up. Right. Okay. So that's beautiful. That's perfect. And this is certainly not just like highlight Victor Ryback's shortcomings or bad habits because a lot of builders do this. Right. And I think this like parlays into like the first question that I had or like first topic rather was like, this is really just about confidence. Right. Like having real time access to your numbers. It's not about like, well, I get in a drywall and like what's the big deal on the delay. It's that you can now enter these conversations much more confidently and you can now start to recognize that you were doing this often enough historically to create a habit out of it. That now it's like totally on you to continue that habit. And it's really clear that you don't have to do that. Yeah, no, I would say it's night and day difference, night and day difference and seeing the change happen. um Just knowing the numbers. That's, that's honestly been the biggest thing for me. I would say this year is really getting those numbers, you know, having a way of tracking those numbers efficiently. It's a daunting task to go and pull spreadsheets manually and try to figure out, that number for plumbing in this sense might be $32,000. Well, my plumber only charged me $28,000. What the hell happened everywhere else? But in my, way it was for me, it's like, I have $32,000 in there. I know I paid $32,000, but for what? You know, and so having that interactive data that you can just reference is super helpful in keeping up and improving. There's jobs we close out and I see we're meeting our margins per job, what we wanted to hit. But be honest, like cashflow or like cashflow wise, it doesn't feel that way currently because we took, we took a hit the last two years because we were building out processes and systems. So those costs are still kind of lagging. We still had our overhead. I didn't lay anybody off. didn't fire anybody. And so we are making, we are profitable and we've actually improved our net profit within the last, within this year alone in 2025. The issue of it all is, is if I didn't have those numbers, I would think we're doing something completely wrong and we're not. you know, where it is improving. It's a matter of just continuing down this path of healthy growth. But I'll be honest, if I didn't see the data right now, I would think we're for sure going under, you know what I mean? Cause your overheads are your overheads. So you have to pay those out regardless and they're due when they're Right. That's a huge difference right there. Totally. you know, keep helping you stay afloat and just see that future forward. Totally, totally. I applaud you, this is great. um The one piece that I wanna hear a little bit more about with you being a fixed price builder, I think between being fixed price and cost plus, um there's a lot of conversation around it. And you'd certainly hear the guys, they're like, we'll do both, we'll do cost plus or fixed price, depending on the job. But really what it boils down to, is tracking cost. Like either way, like really where those people make money, whether you're a cost plus or a fixed price builder is knowing your cost to the penny. And you had mentioned cashflow as well. Like tell me a little about like what your theory is or like how you guys operate on a fixed price standpoint and knowing your cost and maintaining that margin. So being on a fixed price, one is it eliminates the reason I like it is I don't like to have a defensive standpoint with clients. um so constantly having a conversation of why electrical might cost X amount of dollars or why the lights got marked up or maybe the appliance package did. only got marked up 15 % but the lights got marked up 50 % and all those conversations we just don't waste time on them and so the fixed price allows me to give them an online item budget and then just have a grand total at the bottom and if they're asking for something specifically or we know that there's going to be a they could make a simple adjustment to their plans or designs and they can cut the budget by $10,000 or more that they may be asked for during the design phase, I'll throw those in an allowance underneath. So that way they could just look at it and say, well, hell, my kitchen countertops are alone. My upgrades cost me $12,000. I don't need that extravagant of a countertop. I'm still getting very nice granite countertops or ports countertops without having to pay those additional 12,000 just to up. great to this fancy wavy countertop, like that's not where I want to spend my money. And so that I keep it, I try to keep it simple for the client. And what I've noticed is it, it takes away some of the complexity to it for them and kind of that fatigue. What I've been noticing a lot with clients is it's such a big undertaking for them. They have all these different selections and things they have to discuss, things they have to think about. And adding costs to that, that's individually now an open discussion for each line item. It's just an addition to all the fatigue that they got to put up with. so keeping it kind of just one solid number, this is where you're going to sit. If you don't change anything on us, you're going to close in five months for X amount of dollars. Like your project will be done. Keys will be in hand and we're nowhere around. You know, to, yeah, you know, it's your helm now. We're not going to have to be bugging you. And so out of the fixed price contract, we have a fixed schedule as well. So it's all set in stone when they sign and they select their start date. They know their completion and what they're in it for. And so that's that's the reason I do it is just take that time up front to bid everything thoroughly, select everything. count up your numbers, mark it up the way you need to mark it up, the way you need to to make a profit, to be able to scale and grow, and then put that number in front of them. If it doesn't work for them, then you know it's not your client. You just move on to the next one. With the fixed price, what I find myself doing more is doing a lot more allowances, doing a lot more bidding as we go. And then you don't have that opportunity to mark it up because you're already tied into the contract. and you know, you got to have something, you know. So I see myself doing a lot more of that so-called gifting, if you will. Yeah. In that cost plus model. Totally. How do you track your selections and allowances? So currently we track them is we're selecting everything beforehand. So we're selecting everything before we present a more fixed price contract. And so currently we do that on spreadsheets and we're going to be doing that with Inside House Pro. So when they go select it all, it's going to get put on their client dashboard. They'll go in and approve those. Once they're approved, that will finalize the bidding stage. So once everything's a hundred percent approved and they got a selection for each category that we've put in there for them, we'll then start the bidding cycle. So we'll then send out everything for bid, kind of the main, you know, a lot of it we'll do in-house in our, in our takeoff software, but we'll be do the big ones like lumber and plumbing, electrical, HVAC, um, just to kind of see if, you know, their industry got disturbed in the last month or so just to kind of get some numbers on it. But everything else we will just do a takeoff in our office. We got all of our numbers down and keep improving those and revising those all the time and that allows me to you know then know exactly what I'm going to be charged so then I can mark it up properly and know exactly what I'm in it for. Totally. No, that's great. it's because I do want to hear about your estimating too, but are you running your takeoff out of House Pro or using another product for your takeoff? So my takeoffs, use a builder bin. builder bit. That's right. They're very, very easy to use platform. Thing is, five years ago, I was like, very like, I'm not doing anything office related, doing everything pen and paper. I'm not sticking to this crap. not, I don't want to learn it. Don't want to have time for it. I just want to be out there swinging hammers. Kind of start changing my mindset there and saying, Why was that? Yeah. Why? So why did you initially not want to like sit down and learn this crap and then all of a sudden be like, yeah, I do. Like I need to spend some time on it. What was the trigger there? So mainly the reason I got into it was to better, to offer a better service and a product to my client at the end of the day. And the big thing for me was if I'm pen and paper, can't really 99 % of the things I need to efficiently to my client. And so that's what kind of started to open up my mind to be like, you know, we need a learn something here, we need to educate ourselves in a different avenue in a different way. I've always been very focused to improve the building envelope itself, make sure that the home is to the next level of its standards, essentially flipping up everything upside down on its feet. The way we build is one of a kind process, like nobody else in the industry. in our market holds themselves to the standards we do. um And so I've always had that kind of like progressive mentality to like, need to keep going. um Just not in the administrative side of things. When I finally realized that, hey, there's this whole world out there that can help improve that. That's when I started to move forward and start to grind it out in the office, so to speak. Yeah. Okay. So 2019, I mean, when did this trigger, or 2018 was when you started? 2019 is when I started. I my own home before that, like 2015. Wasn't really in the mind space to keep taking it on. And then so kind of revisited that and started going in 2019. Okay, so I guess my question is, at what point did you go through this realization of building a business as opposed to building a home? We could call it that. I 2023 would be the point. Yeah, 2023 kind of towards the end of second quarter. Just started kind of listening and looking to different opportunities. Actually a few podcasts just kind of hearing that, you know, people change their mindset a little bit and that, there's easier ways to track all this information. And at that point I'm like, oh, I got a binder that I left back at the damn office. I'm driving back for like it would be nice to just pull it up on my phone, you know, and that's honestly what got me is just like there's there's far better ways and way more efficient ways to do these things and that's you know at that point in time I was um was already doing certain things online. I was figuring things out, but that's what really wanted me to expand and get back into using uh project management software. We're on our second one now with House Pro, but kind of implementing those things and kind of all developed from not having a good way to track selections, not having a good way to track what invoices have we sent out, what haven't we sent out. And that was the solution for that. And that's what kind of Not us going down the journey. Dude, I love it. And that's where like, I mean, you know, I mean, you were a part of it up until two years ago. This like, if it ain't broke, don't fix it. Or we've got this process in house and it's good. And you hear about it you're like, dude, we're talking about binders and paper. And like, what do you do? Like you think about the cost, just the added cost and the owner of a company. driving 20 minutes, 30 minutes to a project. If they're lucky, if they're in a big city hour, and they're like, shit, I don't have what I need. I got to get back to the office so that I can handle this. Like that is such an absurd waste of time that comes at a cost, right? And why do you think guys hang onto that theory? Why do you think they hang onto this like, wow, I'm not going to look at software or, well, I'm not going to do this. We got it taken care of. Basically like this old dog new tricks concept. I feel like subconsciously to a degree it's procrastination like it's not something you either you feel is of value to you or you just you know it's a mess of things so you don't want to get it you don't even want to start um and that's what I think mainly I think subconsciously for most builders most contractors is They know their value is far more worth it doing something out there in the field. And so not ever getting involved in it. It's just easier. You know, they don't have to dedicate time to learn something. They don't have to find that time in their day. They just focus on the day to day grind and keep on going. until I've only seen people change course of action is when they hit a complete roadblock of either their leads got burned out or they've already burned their reputation and it's kind of past point of repair. only two times I've ever seen anybody change anything. Yeah. Dude, think, so I think you're spot on. If you heard another episode, I'm just like, how many times did builders have to go through these circumstances to your point of like, pipelines ran out, right? Or I've ruined a reputation or whatever. Like, why does it have to get to that point before somebody takes action and sit down and be like, you know, my name might be on the side of the truck. And my value might be and, you know, swing and hammers on the job site, but I'm really building a business here and I should probably take some time to sit down and say, we've got the product side figured out. We're not going to decrease the envelope, right? But we need to understand from the health of the business standpoint, we need to start augmenting this, whether it's software, whether it's investing in, you know, consulting process improvement, community network, whatever. I'm just always so amazed that this is like just the, this is the conversation. Every builder goes through it. And I was like, why does this have to happen to every builder hit that roadblock in order for them to take action? uh I mean, to a degree, I feel like that's just human nature. Moment to really switch something up, you know, uh most people don't bother to switch anything unless it's broken. That's really not the way it needs to be. Think of one podcast I was listening to was, uh I can't tell you what it was even about if it was financially based or business based, but it's like, Kind of the main point of it was, if you're not growing, you're dying. There's only two things in life that happen. It's either growth or death. it's like, that was huge for me because I don't never plan on stopping. Like retirement for me, when I was 15, 20 years old, it's like, yeah, by the time I'm 30, I want to retire. Now it's like, I don't think I ever want to retire. I want to grow. grow and keep doing something until the day somebody puts me in the ground, you know? Like that growth mindset, I think is what really helped me kind of, you know, listening to different things and pointlessly driving across town was kind of a, maybe a perfect storm of in timing, you know, it's just like, there's better processes, there's better ways might as well keep growing. Like said, I was already in that growth mindset of what I build and what I produce has to be the best damn thing out there. And so that, that drive was already kind of there for me. So that's, I don't think I had a hit like us, you know, just an ultimatum. Like we got to either burn this ship and jump off or we got to, you know, hurry up and fix these patchy holes. Or, you know, like I don't, I wasn't at a point where like I had to change course of action, but I did want to. my motivation was becoming recession proof and, you know, growing and expanding and making a client experience great. So I can't say that. I've seen it. I've seen a lot of people hit that roadblock and jump off. I've seen a lot of people hit a roadblock and change dramatically and improve things. For me, it's just, I think I kind of did that with my last business. If I'm going to be honest, being a tile installer, I just, I grew it to a point and I just didn't care to expand past that point. We were profitable. It was a pain in the ass to keep track of those profits. Nevertheless, um but I just didn't have a passion or drive to expand it anywhere past that. So I just said to hell with it. We're done doing that work. And I was already two years into the home building. So I just said, Hey, I don't want, I don't want nothing to do with tile anymore. I'm just going to shut these doors and we're moving on. So you shut it down or did you sell it? I just sold it for the assets that it was worth. So it wasn't much. So it was worth selling because it was one of the main guys that I had running it. uh was kind of my main point of contact there that was really operating the whole damn business anyway, because I was focusing on home building. So I was doing very little in there anyway. So I just sold it to him for the assets it was worth. And now I hired it. And now I hire him to do all my time. Love it. Love it. Exactly the way I need it done. Yeah, that's awesome, dude. That's awesome. I think I so with you having started in 2019, I mean, you're six years in for simple math. would you say to the builders? Because I think frankly, like you've got a hell of a hell of an opinion on this stuff for as new as you are to this game. Obviously, you were raised by builders like your whole family was in it. But like I would say from like how you view business and how you take action is is. quite solid, so good for you. What advice would you give the builder that's just starting out or even the builder that's five, 10 years into a business that is hitting some of these roadblocks that you're talking about? What would you tell them? to work on the processes and the systems. It almost doesn't matter if you're just starting out or if you're already in it. there's always needs to be an improvement to those processes and systems and how you document them and how they're available to your team. I wish I would have started off to the guy who's just started. I wish I would have documented better everything that I was doing, at least to a degree. So when I was bringing people on, it'd be a lot easier to onboard somebody. if we were to, in the state that we are now, I spend a lot of my time just trying to sit down and build a specific process for this. Not that I don't have one, I have one, but I'm trying to like specifically sit down and think it through because I'm not the one doing it anymore. But I know exactly what needs to happen. It would have been just a lot more efficient and simpler to just, you know, record my screen or record myself doing it. while I was in the midst of all of it. you know, just similar to what's popular now of recording everything you do and throwing it on YouTube, just record it for yourself so you could have those, all that data. Essentially, if that's out in the field or if that was something you did in the office, have a way of recording it to just build systems off of it. That's what's gonna make you scalable. That's what's gonna help you take things to the next level. The biggest roadblock for anybody is hiring, right? Well, the number one roadblock is you don't have anything for them. You don't have anything to give them. And so guess what? Now you need a week or month of your time to onboard this person to come to find out that they're like, no, no, this is too much work. And so you just collected all your stuff for a month. And that's, that's the biggest thing I see within my own. experience that I would want to change is better overall documentation of everything. Yeah. And the thing is, is I had the idea right from the get go. just didn't do it. Yeah. Yeah. So I mean, are you talking like sit down laptop and pull up a word doc and just start typing a step one, two, three, four, five, or when you like, what is your actual like documentation process development look like for your team? So now what I do is I just screen record using the Lume. So I'll just sit down, do a short screen recording of how I'm doing something. And then what we're doing now is we're recording. So like my project manager is out there and he's recording things he does. So if he's doing a task that as we grow in scale, he won't be able to handle anymore. um Like doing some of that detail work or how we water soak in the process and the importance of it. He's out there now with a GoPro recording all that. And so we'll use that information to build videos out. So when we assign that task to somebody in the future, they'll get that task with the link of what to do. So if they feel stuck, they're not calling him, they're not calling anybody else wasting our team's time. That's very cool. I love it. We already got the company we want to work with um that can do those kinds of things for us. So as long as we have the video, the Loon videos or that simple Word document, like you're saying, I've used oh like ChatGBT just to say, hey, this is what I'm doing. And then just have it spit out a simple SOP for me. And then we'll use that going forward. um But that's like if I'm intentionally sitting down. just to create an SOP for a specific task. But I am implementing that. My own advice of when I'm sitting down to do a simple task that maybe my project manager needs to do, I'm just recording that and documenting it so then we can create those videos and those step-by-step directions. I keep them very surface-based, if you will. I'm not trying to get into the very last detail of it, just because I've seen a default in that that whoever you explain the task to is looking forward to hit everything just perfect. And they're not focusing what's at hand. Well, you know, when I go to say, write down a simple note, I grab my hand, my pen with my right hand, my notepad with my left hand, well, somebody else might do that vice versa. right Tell them hey grab a pen with your right hand. It's like now they're focusing on the wrong damn details It's like hey, just write down your damn notes, you know, yeah, that's simple, but I see it in the field all the time if I'm trying to tell Somebody exactly how to do something unless I'm showing them It just doesn't work. They focus on all the wrong things They get all the details that I needed them to get right wrong because they were focusing on you know making sure that they offset something the proper distance off the wall and they completely messed up the rest of the the built-in that they were working on they got the shelving location wrong and all this other stuff so you had to rebuild it anyway yeah they got the offset right you know what I mean so yeah and so that's that's kind of what I've been doing with the SOPs as well it's just keeping it very surface base if you will and leaving that room for each person to customize to themselves. So you never know who's coming in and their background and how they like to do things. And so just giving them the high level pointers is all we're doing. Totally, totally. Dude, I think this is great. I mean, I think in terms of like what we had covered, it's all like massively applicable, right? Of your like main point of advice is just document what you're doing to insulate yourself in the future to be able to bring people on. But that all goes into like you don't have to have 10 years of business experience. to start understanding that you're making money in your projects. You don't have to have 10 years of business experience to start documenting processes. And all this leads back into just running a confident, sound business. Give yourself the processing systems to be confident in so that you can move people into roles and they can execute work at the level that you expect. Have your numbers dialed so that you can go into these conversations with your clients confidently and not be giving out charitable work that's not appreciated. Appreciate it, right? So dude, I think this is great. I think this is great. Is there anything else you want to send the listeners off with? Well, just I mean, be open to learning. That's honestly was a huge one for me. It's just being close minded to the administrative side of things held me back for unnecessary, probably four years. Really? I could have, I could have probably held on to the tile business and had a whole nother company up and running. I mean, that's, you know, I didn't have to be so close minded to be like, forget that, you know. Well successful we had a client base we had everything um Could have kept that up and running and just managed it Exactly the way it was going so being open-minded to learning and expanding instead of You know just narrow-minded This is what I love. This is the tools that I grew up with. This is what I've been doing um Although that it is critical and That's really what's gonna make the difference for the client at the end is a person that cares But if you can control from the top down well now you can recreate Everybody you have in the field that's doing it and what I've come to find out is There's people out there that will do it just as good as you if not better and mainly because Their headspace is only on the task that they're working on so they're gonna perfect it far past what you can do when your business is expanding. Because to a degree, every business has its own kind of its own growth without any effort, right? Like a new remodel or builder come into town, they get a certain amount of leads because they don't have a reputation following them. So everybody's hopes are that they're going to do better. And so you're going to have a good amount of leads coming in anyway. Well, guess what? Your head's now in bidding, estimating, scheduling, and doing the carpentry work, setting cabinets and setting doors and everything else. Instead of just focusing on carpentry, you're everywhere now. And guess what? You're not doing the good job that you once could. And probably your main guy is already doing better than you. Right. I caught myself doing this a very similar thing when we were doing tile. And as I grew that from just me solely doing all the tile work to six employees um and getting them all to become installers, it was, I find myself doing that a lot to where they would call me on site. You really, you're, you're going to go ahead and slap that in with, without, you know, polishing it out. And it's like, dude, it's on an inside corner. They're like, you didn't let us do that kind of stuff. We had covered it's all right, like massive. Right. You're like main point of advice is document what you're doing to insulate yourself in the future to be able to bring people on. But that all goes into you don't have to have 10 years of business experience to start understanding that you're making money on your projects. You don't have to 10 years of business experience, start documenting processes. And all this like leads back into just running a confident, sound business. yourself the processes and systems to be confident in so that you can move people into roles and they can execute work at the level that you expect. Right. Have your numbers dialed so that can go into these conversations with your clients confidently um and not be giving up. uh It's not appreciated. Definitely a little bit Dude, I think this is great. I think this is great. Is there anything else? I love it. I really appreciate you hop on the pod. I thought there was a lot of really good takeaways here for the listener um If there's anything I can do let me know um But we'll go ahead and wrap up and I'll let you get back to your day Sounds good, well thanks for having me. It was fun to get a chat with you again. Look forward to hopefully seeing you in Vegas. Yeah. Yeah. Wait, are you going? Yeah, it's in Orlando. You're going to IBS, International Builder Show. Yeah. So that's actually one thing I never did was I haven't missed one since 2015. So I haven't missed an IBS show since 2015. So I've always been in that space of expanding and growing to a degree in whatever I was doing. And even when I was doing tile, I was there always developing my own process, implementing, doing something. Every year I would leave using something new. That hasn't failed. m over 10 years now has not failed. And to this day, I still use them. It's not like that I implemented and stopped using. There's a few products oh that we've used and then stopped using, found something else. there's products to this day that I've now been using for eight years. I still use them to this day on every single build. Love it. Love it. That's where you can get all the best engineers. designers, creators of their products, you get to talk to them, understand their motivation behind it, honestly, you know, really helps to educate yourself at a different level. When you can talk to the engineer and the designer creator of the product, and they can share that information with you, you're not going to learn that in a classroom, you're not going to get that in a textbook. So it's, I honestly, I'd walk the show. very slowly every year and I talk to thousands of people every year. Four days is too short for me. I know other people are like, we ran through it in a few weeks or in a few days or in a few hours. Ran the whole show. It's like, well, that was useless, but. Right. They're going so they can get on the blackjack tables. They're not going to learn. And I'm there for some years, hour before it starts, just so I can get in right on time, be in that first flow of people coming in and I'll be the last guy walking in. I love it. love it. Well, yeah, dude, you have to swing by the booth. We'll certainly be there. um I know we have our booth. I don't know what it is. I should probably know that. But yeah, you'll definitely have to swing by um and we'll probably do like some type of client appreciation event dinner. So keep an eye out on your inbox for that. So let's So love it, Cool. Well, go big red. You keep doing what you're doing, Victor. You're on a good path, my friend. hopefully, hopefully these interest rates coming down keeps everything flowing the way that it needs to. Yeah, we'll have to be back when we hit 18 million. That's right. Yeah. What is that? That's going to be in 2028. Is that what you said? 2028 I mean if the thing is is I'm set up to scale a Lot a lot faster than that. That's kind of the the safe growth so if if these interest rates help we I'm already set up to Like I can do 18 million next year if I had to I love it. I love it. The project managers I have coming in place of everything. none of that is now a great area for me anymore. Knowing profits really improve that. So if I have to, I might be doing an $18 million podcast, you know. There we go. Dude, yeah, we'll have you back. Hey, how about that? As soon as you hit 18, we'll have you back on the pod. Nah, we could do it earlier. We could have you come back on earlier. It doesn't have to be 18. just gotta hit 18 million faster, That's right. That's right. Yeah, dude. actually have an opening next week. If you want to, I'm just kidding. So so quick, right? That's right. Sell them quick, build them fast. All right, Victor. Well, we have successfully ended this podcast on a classic Midwestern goodbye. um So I appreciate you, dude. And we'll chat soon. Take care. See ya.