The Key to Project Success with Alex Molkentin

Alex Molkentin shares insights from his journey in the construction industry, emphasizing the importance of pre-construction as a means to set clear expectations and effectively manage project costs. The discussion highlights the value of transparency, collaboration with clients and trade partners, and continuous learning from past experiences to ensure successful project outcomes.

https://www.builtbyfernhill.com
https://www.instagram.com/builtbyfernhill

Show Notes:
Alex Molkentin's Background and Early Career (0:00)
Lessons from Past Generations (6:10)
Pre-Construction and Marketing (10:59)
Setting Client Expectations (11:52)
Pre-Construction and Cost Management (14:36)
Trade Partner Involvement in Pre-Construction (36:13)
Educating Design Professionals (43:29)
Final Thoughts and Contact Information (45:06)

Find Our Hosts:
Reece Barnes
Matt Calvano

Podcast Produced By:
Motif Media

Transcript

0:00

Business is solving people's problems. And when you break down solving people's problems, really what that is, is setting an expectation and then delivering on that expectation. Pre construction is the articulation of that expectation in tangent with how we are going to actually solve it. Welcome to builders, budgets and beers. I'm Rhys 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. You all right, mics are hot. We're live. Alex, thanks for jumping on, dude. Sure. Man, glad to be here. Yeah. Super, super stoked to to chat with you here. But for the listeners, give them, give them a little background on who Alex mulcantine is, yeah, so I'm originally from Ohio. I was part of a third generation construction company, and the son of immigrants, and that residential company grew, but when I was a young age, I actually broke off from it, started doing my own thing. And that kind of, I think, inevitably, led to me transitioning into commercial work. And I did commercial work for three, four years, and I had this unique opportunity to kind of sell off parts of that company, liquidate the others. And I took a one way ticket to New Zealand, cool, which was a very interesting experience there New Zealand. What so are you from New Zealand? You said you're immigrant. You're son of a nigger. Where are you from? Germany, originally? Okay, yeah. And literally, people have asked me this all the time, like, why New Zealand? Yeah, I wish I had a better answer than simply, it was on the other side of the world, and I just wanted to experience something inherently different than Ohio. It's beautiful. It's like one of the it's like, I don't even unique, I guess is the word to explain it. But it's like, one of the most insane landscapes in the world, yeah. And just also a real I mean, it's a very transient place, and so inherently, you're going to meet people from all over the world. And especially, I'd been to Europe a lot just because of my family. I hadn't really experienced people from the southern hemisphere before, okay? And that was not something I quite expected in New Zealand. I don't think that thoughts ever ran through my head, like, what? Like, what's the difference? Um, think a little bit of Latin culture. And it's actually Queenstown where I live. I lived in Wanaka, and then also Queenstown. And Queenstown, at least when I was there, I believe, was the number one tourist destination in the southern hemisphere. Oh, wow. Okay, so there was also a lot of expats. There a lot of people from Britain, just because of the way the visas all work. And then, of course, Australia and Australian culture was very fun, very interesting learning experience nonetheless. But yeah, it was. It was amazing. And also led to my obsession with the outdoors and endurance sports, which, in turn, is actually what led me to end up in Boulder, Colorado. Yeah, Boulder is definitely the ad. Have you? Did you do the boulder? Boulder? Boulder? No, I've never done that. And also, I'm getting slow and out of shape now, I got two kids. I got two under two right now, so I'm hanging out for dear life in other ways, there you go. Yeah, they're, they're taking your energy other than doing extreme sports, endurance sports. I love it. Okay, so, okay. So your, your folks, there were contractors as well, yeah, and your grandparents. And then you, why did you break off? I am I? Am I? Am I asking questions? No, no, no. I've had this asked a lot of different ways. And I think, you know, it's really interesting to look back at these things in hindsight. And I, my father and grandfather were incredible carpenters, cool built just incredible things. They actually specialized in an area called Shaker Heights, which had a bunch of older homes built by the Rockefellers and carnegies back in like the early 1900s that era. And so it was my dad actually aligned really well with this historical society, which wanted to maintain the integrity of these, like old hand carved moldings and things like that. I'm sure in Boston, you know exactly those kinds of standards. They were incredible at that. But I wanted to run a sustainable business on top of it, sure, I didn't want to be constantly behind the eight ball. And I defined craft as more than just my ability to make things with only my hands. I wanted to make a company. I wanted to make a product beyond that and I. I think also when you're working for a bunch of old stubborn German men, which they myself, would be included in that now it was it only made sense for me to break off and kind of do my own thing. But in hindsight, it was my crash course on business, even though I went to college for finance and economics, the true business lessons I learned were being in business for myself at I was 18. So yeah, dude, that's the story as well as time, right? Yeah. It's like, you can use, you can you can research whatever, like, like, case studies, or, you know, business whatever. But it's like, you don't learn until you're in the trenches. Yeah, yeah, yeah. I mean, the biggest lesson I learned that I was just telling my wife about the other day after we were talking about my father, a little bit about, just like the stressors of business and things like that, was, I do remember my father always promising to my mother, like, the future of a better day. Like, you know, one day we're going to make it one day, you know, the business is going to really, you know, provide for this family you can, you know, quit your job and we can rely on this. And the truth was, is that that never actually happened. And I give my father credit for that in some ways, but it also made me very afraid of making those promises to my current family and then never actually following through on them totally. So, you know, it's really a position of luxury to learn from past generations, I think, and just knowing what you want to be and what you don't want to be, or, you know, being able to pick and choose from all of that is a really, really powerful thing, dude, I think we get at the podcast there, that was beautiful. That was beautiful, dude. I think, I think that is, I mean, that could sum up a lot, yeah, of construction companies, and I think that's why we're here today, is to talk a little bit about what you can do to make your business more of them as a business, right? Specifically, I wanted you on because I liked your perspective from a pre con standpoint, which we'll, we'll dig into. But dude, I think that was, that's, that's great, because I think, again, there's so there's so many individuals in this industry that have the best intentions, right? They have the intentions of a total passion towards a craft, a trade, a skill, whether it's carpentry, whether it's framing, whether it's whatever it might be. And then they see this, they inevitably get into like, this business motion of like, they're passionate about their skill, and then they start to monetize it. And then they wake up one day and it's like, holy shit, I've got employees, I've got I've got income, I've got expenses, I've got all these things that really make up the foundation of a business. And now, what do I do with it, right? And I think the fact that you are self aware enough to respect and appreciate the failure, if that's what you want to call it, that might be the wrong word, but lack of the lack of building a sustainable business from your dad and it motivated the next generation. Kudos to you, because that's what this industry needs. There's such a great opportunity. The barrier of entry is so low in construction companies, the opportunity is so large, but it's like being able to run a construction company well, as it takes a lot of work, and we need more people like you. Well, thank you. I appreciate that, and I will say this that I don't think failure is a bad word. There's actually a book. I can't remember the name off the top of my head, but it just really voices it and articulates it incredibly well. But I think that the measurement of success isn't whether or not you experience failure, it's your ability to learn from it and push through and become a better version of yourself, a better version of the business. And so I would actually argue that I was just asked on my podcast what make because I rebranded, I re I relaunched this version of the company as Fern Hill, very intentionally so. And they were like, Why is it as such? And the reality is that it's the failures of my past, it's the shortcomings of those before me that I was fortunate enough to learn from and then be able to be very intentional about how I set things up now. And I think such a big part of that is pre construction and all these things. And, you know, even beyond that, somebody I'll give an immense amount of credit to is Nick schifer. You know, you obviously know he said something that's just always resonated with me, that it's like, I just want to build cool shit with cool people, and because I think that this business is about connection, but I have a harsh reality that I almost left the industry as a whole. I wondered what I wanted to do. I had degrees, I have all these other avenues. I I thought to myself that this probably a lot of other industries I could arguably make more money in and not have to deal with a lot of this crap. So I then came back, though inevitably, because I love building. It's what I'm actually passionate about. And so when I heard Nick articulate it like that, it was actually a big moment for me, because I was like, You know what? I love the people in this industry. I love building stuff, and if I'm not building the coolest. Stuff out there, and I'm not doing it with the coolest people. I'm just gonna set down everything and go do something else. So like that is the journey that it's a sobering it's a sobering comment of building cool stuff with cool people, or cool shit with cool people, whatever the actual quote is, because it's simple, right? And it's it's grounding. And when you really bring it back to the why are we doing things it? It prevents you from side, side tracking on the business, which I think is super common, right? Because at the end of the day, you're building a product for a group of buyers, right? And, and if what you're building isn't selling, then it can, you can get into some pretty desperate, I guess, decision making. So when you ground yourself in simple logic and simple, simple logic, it's helpful, for sure. Yeah. I mean, we're solving people's problems at the end of the day, like that. That's what business is, totally, totally okay, beautiful. So let's talk about, I guess. Let's just start with kind of like a foundational question, like, what is your point of view on pre construction? How do you view pre construction? So I view pre construction as being the exact same thing as marketing. It is, you know, I just said that business is solving people's problems, and when you break down solving people's problems, really what that problems, really what that is, is setting an expectation and then delivering on that expectation. Pre construction is the articulation of that expectation in tangent with how we are going to actually solve it. And so the reason I say it's in tangent with marketing is kind of twofold, because it's an educational process at one and I think that we've gotten a lot better user experience outcomes once we've really tried to educate people as to what to expect, as to how to succeed within the journey of construction as part of pre construction, but even beyond that, setting realistic expectations. Because the problem could be that, you know, let's just say we aren't doing pre construction, and I get a set of prints, and somebody inevitably comes in with, you know, hey, we want this to cost$2 million well, that's amazing. I would love it if this cost $2 million but unfortunately, it costs five and that is just a bad business model. That's bad sales, that's bad consumer journey, like nobody is going to succeed in that process. But if you then look at that from a different perspective and go, Hey, well, I'm going to manage this experience here. I'm going to help us develop something that is in alignment with that$2 million budget, and we are going to develop a scope of work that is in tangent with it. And then we're also going to talk about risk management. Hey, what is your risk tolerance? Because it's probably different than other my other clients. My other clients. Let's incorporate that in. Let's make sure that you feel that I am your guide from the day one as to how we are going to create a successful outcome. And I think it's been absolutely game changing for us, because without one, I don't know how well the other actually succeeds one 1,000% you made a comment, which I thought was great. It was more so like your your correlation between pre con and marketing and how intertwined they are, and specifically around the educating comment. I was literally just had a dinner in South Shore, Boston with some of the best builders in South Shore, and they were talking about expectation setting and educating the customer base, and how ill educated, if that's the right word, Ill educated consumers are today when it comes to construction, right? It makes a ton of sense, right? We've got, we've been this huge push for, like, four year degrees, and pushing people into white collar jobs and like totally like staring away and creating these preconceived notions of what the trades and skills are, and you just lose those those skills and that line of thinking of generations of that action. What's your perspective on setting those expectations with a market that, I guess, to to bucket them into a large group that don't know what they're talking about. Effectively, how do you set expectations of people that are so uneducated? So I've outlined the consumer journey within those confines a little bit that you know you have to kind of define the product beyond just simply, like, build a house, Build a pretty house, build a designer award winning house like those, things are incredibly complicated and accordingly, can differentiate. So one thing that we really try to do, especially here in Boulder, the energy code requirements are on average, 30 to 40% higher than the rest of the country here, and so we get a lot of commentary at, like, the very early meetings about, Wow, this used to cost, you know, we built a house before, and it was, you know, $600 a square foot. Now you're telling me 900 $1,000 a square foot as a starting point. And it's like, well, while they both might be houses, they're not the same product. This one's being done with our. Like, air tightness, factors, all these other you know, ERVs, like, all these things, they are not the same. Like, yes, they have walls, a roof, things like that. And so number one, getting people to understand that is a really, really important thing, because it's going to start to create a they're going to disassociate with the things of the past. But then beyond that, what we try to articulate is that there's expectations that come along with what you want the experience to be like. You know, we can have this experience be that you have to micromanage every single part of this, and you're going to life is going to be overtaken and things like that. That's one thing like one possible pursuit for you. If that's the case, we are probably not a good fit for you, and that is okay. But if you want a high level of management, a very stress free is what we're always striving for experience because you with the the all the information that we have, all the SOPs, all of the risk management approaches that we utilize, you are going to kind of have this binary process, where zero is where you start and one is where you end. There is a cost associated with that. And if you want that experience the same way, when you go out to a restaurant and you want fine dining, you expect that to have a cost associated with it. We are now going to do our best to articulate to you what that experience is going to cost and I think that combining those two things, it helps to set an expectation that is at least closer to what the reality of pricing is. Totally I love it. And I think, like, even just your example of, like, the fine dining example is, like, I, I wouldn't I'm not, like, a Michelin star guy because, like, frankly, I don't, like, appreciate that stuff. Yeah, right. And it's like, and that, like, just relating that back to building is like, you might have someone that wants to build an air quote custom home, but then when they get into a conversation with Fern Hill and they start going through this process, they might be like, I don't care if the ERV is filtering in X cubic whatever of fresh air into my home, and it's airtight. It's like, I might, like, at that point I'm understanding that I might have bitten off more than I can chew, and that paying $500 for a dinner isn't worth it for me. Yeah, right, yeah. So I think like that, like, even, like, in a pre con, relation to marketing, it makes a ton of sense, right? Because like, you're effectively, like, you're, they're entering your funnel, right? And at that point is like, how, how qualified can I get these individuals to be? And I do that through education. Is that fair? Oh, 100% and I actually on my pockets. I've interviewed a lot of architects, probably disproportionately so than other builders or trades people. And I would say that almost all of them have talked about the fatigue element that clients inevitably go through from the start to the finish. Like, you know, it could be selection fatigue, design fatigue, even just getting too many bills, fatigue and managing that is such an important thing. So something I've I don't know if we've necessarily settled on an approach, but we definitely have gone back and forth, which I think is just a commentary on how complicated it is, how much information is the correct amount of information for a client to be receiving in like these cohesive documents. And so for us, even in initial pricing sets, I'm like, you know, our budgets for a custom home can be 300 500 line items very easily. I don't think it is a reasonable expectation for somebody to go through a 500 line item budget and then walk away with a accurate reflection of where their project sits, or what's driving costs or what's disproportionately affecting then budgets, as opposed to other things. So what we try to do is actually tier that system for them and give them a digestible amount. And it's the same thing even in the pre con process. You know, we used to have it be that it was like 1015, stages to this construction thing. And what we really want to ask people is, what do they want this experience to be? Because, you know, if we maintain that position as the guide and let them articulate to us what they want it to be, we can then facilitate the correct amount of information to be given to them and also articulate to them. Hey, this is what we're going to be doing behind the scenes. If you want to be involved in this, by all means, we can schedule these meetings and involve you, but just so you know, as long as we know where you stand as a whole, like for the ethos, you know, of this project, let us advocate for you. Let us, let us get you to this next phase, and then come join us. And, you know, participate 1,000% I think it's great. And just like, in terms of the guide, it's like, they want to know the lefts and rights, right. They want to know how to like, navigate to the trail. They don't need to know, like, watch out for this rock here and, like, step up over that. Like, they just want to, like, be like, they want that person in the front navigating that they're following behind and getting to where they want to go. Yeah, I literally had a phone call with some clients on a project that we're currently in construction for where they just were like, Alex, you have to do me a favor. I cannot select another light fixture. I just cannot do it. I We are just going bonkers. We we didn't know that there were so many light fixtures. We. To put in a closet. I'm like, yeah, that, you know, there's a lot and like, just, please, just put the, put the submittal package together, and just get us close to where it is. And if we have to change one or two things, fine, we'll do it. But I just can't look at another light fixture. Yeah, I completely understand. These are people that have a family, people that have jobs. That's how they're paying for the darn thing. Like they don't want to be doing this like they are trusting the design team and myself to advocate for them and be like, Hey, we know basically where they want to sit. Let's do our best to get them as close to that as possible. And if they want to become part of the process to change that slightly in this direction or the other, they have that agency totally, 100% okay, so I certainly want to keep going down this path, but I do want to make a comment on you'd mentioned that as of recently. I can't remember the exact messaging, but you basically alluded to like, this has been a newer concept, and it has, like, changed your business. Yeah, well, I would say that it's been a newer process that I've articulated it as pre construction. The reality is that even my grandfather always did it. She didn't do it as a form of marketing, per se, but, you know, he was doing his own shop drawings back in the day, by hand. My my dad did the same. They were preparing for the job before it ever started, and thinking through every aspect of how to succeed within the confines of it. And I learned that from them. I just took it to the level unintentionally. And I think it was because of my experience in commercial, frankly, which pre construction was a term there, obviously totally to where it was advocating for the business side of things, equally as in as the constructability methods. And I forget the gentleman's name, Schroeder, I believe is his last name. He's actually a scheduling consultant in the commercial world. He said something that really, really made me make a change. He said that you can never allow for the design of a project to progress beyond your ability to understand it from a constructability, budgeting or scheduling standpoint. And so I actually articulate that to the clients as being my role in pre construction. And so once I found that out, it just defined the scope of work so clearly that it actually informed our contracts, informed all the like, how we bill for it all and things like that. And so once we figured that out, it changed a lot for us, and I would even say that it changed the clients that we ended up aligning with, dramatically. So overnight, totally, totally. What are some of the like, some of the biggest wins outcomes of this like, specifically, because like, I think it's very appealing, right? It makes a ton of sense based on like, how this like, effectively is, in a like, there's a qualifying component, right? From a marketing standpoint, there's an expectation setting standpoint which is going to inevitably impact the rest of the build. But like, what are some of the specific examples? It could be good example, or positive examples or negative examples of this of your world in pre con. So I would say that the biggest wins are just being able to deliver on what the expectation that we've set is, because I part of our sales process is being like, hey, here's tons of data sets where I show you that our average is about 4% on our originally estimated cost of completion. Like, I've taken immense pride in that. But in order for us to do that, I have to articulate what scope is currently and then also be able to articulate to you throughout the construction process what is a change in scope, because those numbers could not convey accurately what my role is and everything. And so when I convey that to people, and the end outcome is like, wow. Alex said he was going to be 4% on budget, and then we're at 4.2% that right there is us delivering on the promise that we made to them. They budgeted for their family life, all these other things, and now they're happy to produce, you know, pass our name on to the next client, or whatever it might be. I would say that is the biggest win. I would say that the shortcomings that were part of that process were actually when we came short on articulating expansions of scope versus just the estimated cost of completion, which I think is a trap of cost plus, frankly, but because that could look in turn at the end of us not delivering, it could be like, Wow, we're 18% over budget. I'm like, Yeah, but you just added $400,000 in, you know, additional scope. That's not, I can't be expected to be more efficient at my process as a result of that, it's moving the goalpost effectively, right? And again, I keep going back to this dinner that hadn't stopped short, but this, this conversation got brought up, is like, I'm personally again. Having never run a construction company, I think cost plus makes a ton of sense. I understand fixed price and the benefits of it, and the precon is obviously very tightly associated with fixed price. That's not to say that cost plus builders are not doing pre con, right? But how does I just don't understand how this $400,000 scope change happens, and clients are even, or even remotely close to having an opinion of you pulled the rug on me. I just don't get it. How does that happen? And from an expectation standpoint, there's a very simple expectation to set. I'd feel like it's like, you want to add this great. Here's the cost sign, the change order we're in, we're moving totally I don't know if I have the clear answer to that, but somebody who I have immense respect for, Harvey Hine of Hmh architecture, who I've done several projects with, he was actually on my podcast, and we talked about something similar, and his response was that at the end of the day, we all hear what we want to hear. And when you think that in business, in order for you know, you asked, How does this happen? Saying no to people is inherently harder than just being in the business of saying yes. And I think that far too often, it's easier for people to kick the can down the line in terms of like, well, yes, you can have this additional wing with four bathrooms in it. Why? Yes, somebody may or may not know that that's going to just blow budgets out of the water, or the original, you know, set price of everything, but the far too often it's left to the contractor to be the one to articulate. Well, this is not an alignment with the expectations that we set. If we want that, we have to shift the goal post, like you said, but somebody should have told you that the second it came out of somebody's mouth. And when that doesn't happen, I think it's really easy for people to become emotionally attached to things. And I mean that right there is actually an articulation of why we're cost plus, not fixed price, like I we utilize Procore as a project management software, and so we actually approach our documentation methods as if it's fixed price, even though we're cost plus. The reason I'm cost plus is because of the inherently emotional journey that is residential construction, like there is no way around that. And you know, I think the better we can recognize that people have these emotional connections to their home, to the biggest investment of their life. You also then realize that there's going to be these moments where logic gets separated from, you know, the actual process itself, or the decision making, totally, totally I am. I think that's probably the biggest takeaway. I mean, do you have that like, SOP out in your team? Like, I imagine, just like a client working with a project manager, and they're like, doing a site walk, and they're like, Well, Becky, you know, she had her, you know, glass of red the other night she was on Pinterest. She was looking at this and X, Y and Z, and she saw this on Instagram. And we'd really like to do this. Like, is the SOP for the project manager to be like, we can 1,000% have that conversation. Let's go over budget. Let's go over what we had discussed initially. Let's do it is that a part of your move? Is that ridiculous to bake in? How do you do it? So it's actually fascinating that you bring this up. I was meeting with some prospective architects on one of our job sites yesterday, and we were just talking about pain points. And one of the biggest pain points that they said is that they have a client currently complaining that the budgets just gone up so much. And it was literally this exact same situation. Well, it's like, well, yeah, was she drinking Red or white? Who knows, it might have been what I heard. It might have been both, but I so the system that I have set up and within Procore is that we have separated budget changes from change orders. A change order is a change in scope. A budget change is a change in my estimated cost to complete an asserted scope of work. So in other words, when I if I think that, hey, we're building, let's just say the cost to install these cabinets. If I think that, for some reason, the exact same scope of work, the cost went up, for some reason, I would articulate that as being a budget change. It's a change in the estimated cost of completion. But now if you add, you know, 14 walnut cabinets on the other wall, I will do that in a signed change order to the client. And what that actually does for me within the budgets is it's separate. It gives me two separate columns, and it goes owner asserted change scope changes shows up as signed change orders, and then budget changes, which I'm able to articulate as changes in estimated cost of Completion is a completely separate column, and that's the column that I actually care about. And I am constantly trying to have the PMs superintendents myself at every single meeting, they need to be pointing out that column as being separate from the other column, and because what that's going to do is create a sense of responsibility. Right, and that, hey, I'm responsible for this column. It is my job and my responsibility to inform you of your responsibility towards that other column. Totally. Okay, so by separating it effectively into like a customer change and a builder change, yeah, gives you the option, and then, so you're focusing mainly on the budget, on the builder Change column. Well, what I want to articulate to the client is that I can control that. Yeah, you can't have the expectation that, like, you're not paying me to control you. I can, you know, inform you, yeah, as well as possible. But I don't think that you want me telling you what to do. Truth be told, I have had clients that literally do want that. But at the end of the day, if they want that, and they sign the change order and they want to pay for it, that is completely their prerogative. I just want to make sure that they have the information and an accurate expectation in order to do that from an informed position Totally. I mean, this is like getting into a path of, like, tracking financials effectively. I mean that to me, sounds like the backbone of being able to run solid pre construction. Oh, 100% it's all about data capture. All about it, because without the data capture, I don't have the informed perspective for myself to articulate expectation to clients. And so that's actually the workflow, though, is that I have to have it, that every single piece of the company is our is capturing their data in a way that I can then track it to what is the change event or the deliverable driving that cost? Because if I can't do that in a very like digestible way, like, like, you know, I need a data science degree, not an economics one. Totally, totally well. And I think I was, I was doing another podcast with a builder out of Lincoln Nebraska, and the he brought up very similar conversation. His was along the lines of, like, they were doing, like an addition right on a house or something. And then they needed, like, the client was obviously living there. It was, like, a renovation addition. And they're like, hey, like, you're already here. Like, we actually need to do stairs up to our deck. Like, can you do that? And he was just, like, on the job site said, like, yep, of course, sure. And then he, after he'd agreed to it, he had gone back and he had looked, and he was like, that's actually chewing through, like, a significant amount of margin that, like, I just, like, totally, just charitably handed over. Yeah, right. And it's like, without this information, without the data, without tracking it, that's where you can go sideways on pre con. You can have all the conversations and expectations setting in the world, but if you're not reviewing what's actually happening, it can be a cluster. Well, to bring this back to pre construction, being an educational platform as well, we go over in some of the documentation we provide. So in Procore, specifically, there's cost R OMS range of magnitude. We educate them as to what we set forth to you on a change order is a range of magnitude expectation. In other words, we this is what we are asserting. We think it is going to cost. But in these incredibly complicated projects, how am I supposed to articulate to you the critical path effect, 17 line, you know, schedule line items down the road, like we just don't know. And so what I'm going to do is I'm going to take certain factors from historical data try to set an expectation for you, and that's going to be the ROM that number can still go up or down, because if you start having people treating that as a fixed number, you might as well be fixed cost, and probably going to give a different margin to begin with. Totally, totally. I think that's that that range of magnitude is important. And that's where, like, even when you start talking about change orders, again, I keep reverting back to all these like, episodes we've done, but there's a builder was like, Well, how do you even, like, how do you even price out a change order when you're like, thinking about, Okay, well, it's not only just, like, here's the cost of the material, here's where I think the cost of the labor is. We're talking about schedule shifts, we're talking about supply chain, we're talking about, like, admin effort to go through all these processes, like, there's so many things that go into it, so it's like that range of magnitudes effectively insulating you there is that fair? Oh, yeah, it's incredibly so, because I think it's impossible to give accurate pricing expectations on any change order, because you know, you just don't know. You probably have a limited accuracy to put these numbers to begin with. It is an estimated number from the beginning, and when you're doing it on the fly, out of order, out of sequence, in these, you know, inherently one off projects. You know, I tell people I could just, you know, multiply this number by three and tell you that, but, like, I don't know if that's going to do anyone any benefit. And so, you know, I hate change orders. I wish that they weren't a part of any project. Inevitably, there's always change orders, always. But the thing that I tried to, you know, and. Again in the pre construction process, I want every single decision on this project made before we start construction. And the truth is that that bar isn't hit on many projects, but I have been able to shift the needle way closer than we used to be. But the way that I motivate the clients to actually advocate within the design development process for that to happen is that I tell them that, hey, if we design for this right now, the cost of it, let's assume to be x if the day after construction starts, if we add that in, while you might not think it's a big deal, you should assume that as every like magnitude of time progresses beyond it's going to go from 1.2x 1.6x 2.1x 2.1x and I can show you data set after data set after data set of, hey, for us to do this simple, you know, regular detail over here at the beginning, it costs this. And now, for some reason, we added it because we couldn't make this detail work on the trim. Now it's going to cost 2x and so if you don't want it to cost 2x we need to advocate for that design to be developed right now and as soon as people understand that there's that price Delta associated with it, it's they don't look at as me being just annoying, wanting to do it my way. It's me advocating for them that needs bookmarked for all the listeners out here, explaining it to the client, that if we aren't making these decisions today you are going to have a more expensive project, it is the biggest indicator of a successful project, bar none. And because, how am I supposed to set expectations on an incomplete set of information number one? And you know, I said my ability to deliver on a set of expectations is what determines outcome of the project as a whole. And so if you're constantly moving that goal post from day one, that's that's a model that's very hard to succeed in. And I think advocating for that in a way that informs the clients. It's actually not you just advocating for how I do things, it's me advocating for them to succeed. That's totally, that's the process. Totally. This is killer, real quick. I do want to talk about the post initially, because I think, like when, especially when it comes to pre con, we've been talking about, all about, like, GC, client, recon, what is your point of view on GC, subcontractor, vendor, pre con? So we literally articulate to people, you know, we've, especially since I've been hosting some marketing events and developing a little bit of a, I call it like a maker community here in the front range. Love it. I've had more and more trades like reaching out to us, and I simply set the expectation that the trades we align with best require participation in the pre construction process. It is a non negotiable for us. It is we want to pay you for your time. We have it in the budgets already that you will be paid for your time. And it's really interesting too, because a lot of people like, Oh no, we'll do like, you know, no worries. No worries. No. That's not the product I want. I want the product that we pay for, because I want you to actually invest your time and energy into it. And so I think what, in turn, that actually means for the subs, a lot of times, is they have to be organized. They have to be able to articulate what's driving their costs and whatnot. I have a framer right now who I will give him a shout out, raising sons construction. He is a really, really good trade partner, and the truth of the matter is that he's learning on how to have a high level of delivery. He is learning how to bring value to me as a GC. And I've said to him time and time again, you know, when he doesn't know how to do something or how much time it's going to take, because maybe it's a little bit unique, like, you know, currently we're doing a double stock construction with a service cavity, and then half the house is engineered LSL. The other half is dimensional number. And I want the LSL and all these articulate these articulated places so that we can, you know, value engineer at the drywall and things like that. If he doesn't know that, tell me that. And what we will do is sit down together, work through the drawings, create expectations on time as a measurement, and then have allowances so that he makes sure that he's covered. And then the next one, if he wants to articulate, is a fixed number or something like that, but like, Let's capture the numbers together. That's how we succeed. And it's the trade partners that go, yes, let's do that, that we want to be teaming up with. What do you tell the builder that tells you that's impossible, that takes way too much time. There's no way we could do that with our trades. Hold my beer. Hold my beer. I'm just saying I'm like, it makes so much sense that that is bettering the community, right? I that it's not just sitting here and be like, There's no one I ever can do the goddamn work. Anymore. No one wants to ever work. No one has the skills. Blah blah. It's like, Well, dude, you know what you want, right? You want the LSL and the exposed and the value engineered. I'm not that guy, but you are right. You know it. And if you're working with someone who's got the fundamental skill that you're building a relationship with that you believe can do it, you want to build that relationship for that conversation to be had, and now you are effectively building up a subcontractor that's going to be more valuable for you in the future, because this time spent has been educating them to deliver the work you want to deliver. I want them to make money. I want them to make a fair, honest amount of money where they go. Wow. You know what? When we're on a front Hill project? We know we're going to make our money. We know it's going to be lower stress, because we're going to be prepared. It's not going to be these fire drills all the time and things like that. We are going to know that if it's we've articulated a scope of work that we won't have to have these arguments as to is, hey, is this a change order? Is this not we've already done that work, that confidence factor means that, you know, when we advocate for them, we also have this expectation that they then advocate for us, because, you know, we need their help, and we are at the mercy of their ability to deliver. And it's incredibly, incredibly important. Because the other end of that too is I actually get, I think, more annoyed when new trade part or potential trade partners will come in and say, just toss out a giant number, because they just looked at it, and they're like, Wow, this is complicated, and things like that. And I know it could cost that, but that's actually not the product that I'm selling. I'm selling that we are going to set as realistic an expectation as to what it's going to cost, and then articulate the risk associated with it, so that I can inform the design being developed, and they can maximize their dollar being spent how the client best sees. Because if we just, you know, say the trim budget, we look at him like, wow, this is crazy complicated. We haven't really thought it through. We're going to say three going to say $350,000 budget. But now maybe they don't go for the same lighting details that they would have otherwise. And now it's like, Well, hey, we just developed a more efficient way of doing this. The budget's now are 250 they could have had that. And now that's a change order which is going against the product that I am selling to the client. So it is really, really important that I, you know, in truth be told, I don't hold that against a lot of trade partners, because I don't think that they have that experience on a repeat basis always. You know, if they don't say that big number, then they're constantly trying to have somebody else drive their number down, drive the number down, and then they get down to that 250, or whatever it is, inevitably, and that inevitably, and that's not the model that we take. So I have to take responsibility and inform them of that so that they feel confident in telling me a more accurate number. But it's like, hey, if I'm selling the client that we are going to do pricing exercises to maximize your dollar being spent within the design that has to start with my trade partners. It has to totally, totally. I thought this is a great episode, Alex. There were several massive takeaways for the audience. Two things. First, is there anything else regarding pre con that we may not have talked about, or do you think is, like massively important in terms of how builders view and execute pre construction. I think the other side of it that I actually, I would say, spend the equal amount of time thinking about is how to make it a value add to the design teams and educating the the design professionals in the area. And I think that's inevitably in the high, high end markets, a known thing, but I think it's slowly trickling down, and probably too slow at that, but that's the only thing I did. So educating the design side effectively, what I'm thinking is, and how I maybe less politically correct, say it is like you could design one thing, but then the actual execution of building it is completely a different thing. Yeah, yeah. And also, I equate it to what if somebody could design in a way that they knew it was always realistic and you weren't constantly having to go one step forward, two steps back, two steps forward, one step back. What if it was a more linear process? Would that make a design team more professional? Would that increase your ability to deliver on the expectations that you're setting? Because if so, I can help you do that. I have these standard operating procedures. I have these data sets that we capture that can do those pricing exercises as a relatively small investment like yes, of course, we charge for it, but it is not going to blow the design development budgets out of the water or anything like that. It's just simply meant to be a value add where we can help inform your process. Totally. I love it. That's great. The second. Piece of my question, where do builders find you so they can follow you along and get more? Alex content, yeah, so on Instagram, built by Fern Hill is the tag name is almost called handle. I think they're called handle, okay, yeah, should know, yeah. YouTube, I learned it like a few weeks ago. Yeah, I am getting a crash course and all this media stuff. Yeah, we are launching the YouTube channel here that's in the works that will be built by Fern Hill as well. I also have a podcast called the build project, where I the big component of that is just trying to really create a community of makers and articulating the perspective of not only local architects, but also, I say this a bunch that I a big goal of mine is to also interview the people sweeping floors on our projects, because they have some element of value that would only elevate the end project. And I think that the stories all of us have the trajectory that makes these beautiful homes, makes these beautiful spaces, is just such an important human element. And so the build project, that's my podcast. And, yeah, okay, beautiful. So Instagram. And so my Fern Hill, built by Fern Hill, built by Fern Hill, B, U, I, L, T, by Fernhill. F, E, R, N, H, I, l, o, love it. Podcast, the build project, the build project. And there's a third one. YouTube is built by Fern Hill as well. LinkedIn is Alex mulcentine, and then also Fern Hill construction. He's all over the place. If you guys need to follow. Alex, just DM me. I'd happy to get you in touch. But no, Alex, this was, this was great. Your wealth of knowledge, dude, very, very well spoken. A lot of really tactical takeaways here. Well, I'm excited to interview you now. So, dude, I don't know how that's gonna work. I've done several podcasts. You might I feel like I might be a tough guess. You might have to do some do some some digging, some discovery, but no, I'm super excited to jump on your show. I'm an open book. Appreciate it, man, cool dude. Well, I'll let you get back to it. Appreciate taking the time. Sounds good? All right, see ya.