Episode 3 of Ladies Who Build has dropped!!! Ready for some juicy insider knowledge? Get the scoop on growth here!
In this episode, Ashley and Michelle continue discussing the stages of growth they saw in the company over the years. They cover all of the lessons they learned making pivotal business decisions. These specific instances led Ashley and Michelle (work wives) to where they are as leaders and where Simply Home is today!
Ladies Who Build is available on Spotify, the Podcast App, and Youtube! Listen in - you won’t regret it!!
This Episode Will Cover:
• The Four Quadrants of the company
• Job roles created initially vs. how they evolved
• The Industry: How Ashley & Michelle learned the construction industry
• What to expect and the shifts seen after big company changes
• Estimation and our pricing matrix
• Mark Up and Margin: the tarantula story
• Client Expectations
• Proactive Hiring and Reactive Hiring
Next Up: Find us here in two weeks talking about being women in the industry!
Learn More About Ashley, Michelle, & Simply Home:
Episode 3 Transcript:
Welcome to episode three of ladies who build. We are talking about the stages of growth. Part two.
So we have four main quadrants to talk to you guys about. We have ops slash people. We have sales and marketing. Financial legal and then project management. Those were the four buckets that we broke our company down into because I mean, really, because that covers everything for us. And I think for most companies that covers.
You know, the operations of a company, I think it's different depending on the business that you have, but we broke it down in that way, because how we think of it is this. This scale that I have reflected on and thought back about where every time we made a business decision, it was in one of those four buckets, and then every time we focused on one of those buckets, the other buckets ended up, you know, depleting a little bit. And some would be on E and we'd have to go back and focus on the other buckets and be like, okay, well, now that we've solved. Our sales scripts. We need to hop over to financials and work on our pricing guide. Or now that we've solved our vendor onboarding process. Now we need to hop over and focus on redoing the pricing guide.
Right. And so it was like every time we started working on one thing, we would have to shift over and work on something else.
Yeah. I mean, I think too. You know, it's it's, you can't really break them down into what happened first, right? Because I think they're all kind of simultaneously happening as you build a company and as you start hiring people, right? So back in the day, you know, what was HR? We, we didn't obviously have an HR back in the day and you know, but as you grow, you realize that it becomes more, more important, right?
I think though, if we broke down sales and marketing a little bit. So our first hires were salespeople. We needed to get the name out. And so we felt that the most important thing was just kind of hitting the ground running. And I don't know that we necessarily focused so much on marketing at the time that we knew we needed to market ourselves, but we also didn't have the budget to kind of go all out. I think Facebook was still so big then, you know, we would be hitting Facebook. , and that, you know, it maybe worked, we don't really know, but a lot of what we did for marketing was just showing up and so. Because we didn't have the budget for it. We just had to be the walking billboard. You know, in a sense. And so I guess we kind of started out sponsoring luncheons and you know, hosting.
Hosting. I mean, just hosting, it was like seeing any kind of like, when you volunteer, you can either give time or money. Yeah. And we gave time we didn't have money, so we gave time and it was everyday, all day. Where could we be? Who could we be talking to? And we talked a little bit about this in previous episodes, what our marketing was like, but it, I mean, it wasn't a whole lot of anything. We tried to do social media. We've learned the difference over the years of what it's like to have a really good social media company, which we do have a really good one right now, but overall we, yes, sales and marketing were the initial focus. We had marketing people helping us with social media because that is not my thing.
I love other people's things. And I envy them, but that's just not something I love to do. So I focused on sales, so it was like, who could we hire? And then how it developed, right? Like sales and marketing. We had to learn how to build scripts, and then we had to learn about, we know things that would close the deal, what were appointments that we needed with the client? What were we doing at those appointments? What was the goal to accomplish? And then Michelle and I thought about over the years, how that department has changed.
Yeah. Like, so at first I started with all of us were salespeople, right? And then we would come back and do the estimates. So then we became estimators. And then once the client approved it, then we became the project managers. And, you know, quality control and all the things. And then we would, you know, but we didn't just have one project we were each working on, you know, multiple projects. Way too many, you know, probably 10 at a time, but they were made ready, and so they weren't obviously large scale remodels at the time. Not to say that it was less stressful, totally was because they're so fast and quick moving. If we were to do this again, I would say when we, when I hired you and then when we hired the next two people in sales, then I should have been focused on other things. I shouldn't have been in sales, but that was my level of, well, it's kind of already known comfort, you know? I should have been focused on other areas of the business. And then same thing with you.
Yeah, but instead we were all doing sales and project management, and then the other things kind of just, you know, that's what I was doing from seven to 10:00pm at night. I was looking at finances or working with the bookkeeper or working on marketing. Working on legal matters. I mean, doing whatever else, business growth, business development that I needed to do.
Yeah. It's funny you say that because I think about how we kind of morphed into what was needed at the time. So like, you focused on that. And then I saw a need for more project management, okay. We need someone to be the ringleader of all the vendors and paying them out. And going over expectations with them. And it wasn't like you asked me to go into that. It was just that that was a need. And because it was just us and, you know, a few other people, it just kind of naturally felt like, that's where I went.
And for a very long time, sales was project management and estimating, and then we realized, okay, we cannot. As we scale, you realize you just physically can't do it all anymore. And then we were also seeing errors happen because a sales person was project managing a banner, you know, and vice versa. Right. So I think that that shift started happening when we no longer could do it on our own errors. Mistakes were happening. We couldn't deliver on what we were promising anymore because it just became too much. And so then we decided to separate the two departments into sales and project management. And that was like a big deal at the time.
I'm sure people listening are like, well, no, duh, right? Like, create a department. It's a specialty. The role became more specialized and we realized it takes a particular person to focus on sales and it takes a particular person to focus on project management. And now when we talk with our coach looking at their disc and their values, when we're hiring, you know, are they going to be a good salesperson? What do they value? What's their behaviors and things like this? We realize that a salesperson is very, very different from a project manager, but at the time, it was like, yeah, sure you do that. You handle those clients, get them from point a to point Z and walk them through the whole process. So then when we made that transition, our entire team, I was freaking out because they were salespeople that had always done it that way. And then all of a sudden they had to trust our project management team to take care of their clients and to get the project executed properly in, you know, and all the things that we promised. And that was an issue for a long time.
Yeah. That just reminded me of such a good point. Our coach made it a long time ago, our business coach said, "when you make big shifts like this in a company, you can expect that a lot of people will leave because that isn't how you hire them. And they might not be on board with the vision and the change that you're going towards and that's okay."
Right. Like we thought, oh gosh, we're losing people. This is not good, but in reality, it's kind of part of the change or like you're like de-shedding, right? So you shut off what you used to be, and sometimes those were employees and unfortunately, you know, it, it was what it was and that's fine. But if they weren't in line with all of the big changes that you were creating naturally, they're just going to go, they're going to do something else. But, so, you know, after each phase of growth, we brought on new people. That was in line and I believed in that new vision that we were creating.
Yeah. And I think that's something too. We thought about over time how, how we've morphed into, from one role to another. So like a scheduling coordinator turned into a construction manager. Right. Do I have one? Yeah, because we created the scheduling coordinator role when we found out the project managers were doing a lot of their scheduling. But it became difficult because they had to be in the field, and then they had to go meet with clients. Then they had to go meet with vendors. So by the time they got back to their desk, I mean, it was like four o'clock, you know, in the afternoon. And so then what? You're supposed to go call all these vendors and schedule all of the work for the next two weeks? Like that was intense. And that's why people were working till seven o'clock, eight o'clock at night, because you even had this whole other portion of the work that you had to do.
Okay, so we can jump into financial and legal, which is one of the other quadrants of our stages of growth, and I think one of the biggest factors to focus on. There was our pricing guide and how that was so necessary as you go on more projects. It's really time consuming to get bids for every little thing, and eventually when you start getting the same bid for the same work, you start to understand, okay, it makes sense that you're charging me for this because I've seen that before. Whereas then you start identifying like, whoa buddy, that is way too much, and that is not acceptable. That's not what we're going to pay. But then we had to document all that, right? We couldn't just remember it. Which that's not our strong suit at all. So the spreadsheet is this pricing guide. It was a mess. I mean, it was a very, uh, it was a fugly looking spreadsheet. It got the job done, but it was really ugly. Memorizing that pricing guide, then we had to manually calculate, okay, well, there's this much flooring at this price per square, but at this markup, and that's what we're going to put on the invoice.
But now I actually think you're right. We all had to memorize these numbers. Yeah. Remember they were in our all of our heads. And then when we hired our first business consultant, I remember we weren't making the cash that we thought that we would be, and we were like, this doesn't make any sense. And I remember he sat down and we went through the financials and we probably spent a few hours doing it. And we're sitting at this long conference table, and I remember it was a glass conference room, and he was looking at the numbers. It's like, tell me how you put them together. And then he goes, wait, what'd you say? And I remember I repeated it, whatever it was. And he's like, well, no markup and margin are two very different things. And I was like, go on. And then at that moment, I realized that our markup and margin were two different things. Therefore we weren't making the margin we were expecting, and it was mind blowing. From that day forward everything made sense, but up until that point, I could not figure it out.
What's actually incredibly hilarious is that that didn't really happen until a couple of years ago. Yeah, the business, what were we even doing for those couple of years? Like, I think we thought we were making money and we're like, we're doing well. We're doing great. And then, and we were doing okay, we're fine. Making money. We were profitable. Yeah. But we shouldn't. We were like, there something's wrong. Like two plus two doesn't equal negative one. So what's wrong here. Input and their output here. Yes. And that was so funny.
And when I was reminiscing about this, this hysterical story, I remember when I was at radio coffee, and radio coffee was just built. And I clarify this because of what's coming next. Radio coffee was just built, and I was so excited because it was one of the few coffee shops in my neighborhood, and I could meet people outside of my home. And I was sitting there with the business consultant, and he was talking to me and immediately looked down and I thought that he was staring at my chest. And I was thinking, wow, bud, this is super uncomfortable, and I can't believe that you'd really just be staring, and the whole time I was thinking like, what am I going to say to him? This is so pervy. And by the whole time, I mean like several, it was probably like 30 seconds. Uh, glance down and you're like, oh my gosh. So then I look down and I see what I thought. Was it true? Roaches? Well, we pulley in my chest. And so I squealed like a little pig, and I knocked that thing off my shoulder and I jumped up and ran. I mean, I don't even know where I ran. I just ran in circles. Right. You're like, "get this thing off of me!" And he was hysterically laughing and I said, "Mr blankety blank." I almost said his name, but Mr. Blaney was like, "why didn't you tell me?" And he said he was too shocked. He's like, "if I tell her she's going to scream." And I'm like, "well, yeah, I did that anyway." Right.
But anyways, that's how you understood the market. Because of the trenches. Really and here we are. And the business is where it is all thanks to that day. Thank God for that experience. Uh, yeah. You know, he was our first business coach and we really did learn a lot from him. I don't even know why you decided to hire him, but I guess that's a different story for different day.
But, uh, yeah, he really helped us understand, okay, this is your markup and no matter what. You can't go below this market because then you're not going to make money for the business. Right. We couldn't grow. So that was it really.
Now we have a pricing matrix that is very substantial. It's very robust. Lots of formulas, everything. Everything auto-populates in a way. There's still a lot of manual entering as far as our estimator role. Like they still have to go in and input all the information, but it is so detailed out. It takes in all the considerations, which is amazing because we are different in that we are a lump sum contractor. Which we'll get into in another episode, but here in Texas, that is one of the things that contractors can do in order for clients not to pay sales taxes, you lump sum everything together. You don't separate materials from labor and it benefits us, and it benefits clients in a lot of ways because, it allows, it pushes us to thoroughly think through the scope and pricing ahead of time. So that change orders to clients are really only the unforeseen and client requests.
And a lot of people gravitate towards us anyways. The clients aren't informed about this, because I remember back in the day, people would be like, "oh, you don't do... what is it? Plus cost plus cost plus." You know, people say, "oh, you don't do cost plus," or, "oh, you don't do this." And Michelle and I have always been different in the way we approach things.
I feel like a lot about education and expectation setting, but because we're an established business. We don't have to like to follow the norms as much. Now we can really push for it, what our vision is, and how what aligns with our values and our integrity. And what we want for clients, right? Because if we were a lump sum contractor, 10 years ago from a big cool, I've never heard of that. I've never heard of you. Yeah. And I'll just have this guy do it right, because you're a woman. Oh, that's the next episode. Because you're a woman. That stay tuned... We're very, we want to be different, and we want to be different for a reason because we want to. Obviously sell you on what we can deliver in the project, but we like that we have that in the bag. Like we can deliver quality work time and time again. That's not. And you can also get that from other people, right? You can get quality work from other people. But you can't get the service that we offer. Like honestly, bar none. You're not going to get the service that we offer here.
Wow. You know, look at you selling, uh, yeah, let me get back and say. Come back to the dark side.
Well, you know, those are, kind of like high-level projects or areas of growth, um, and stages. I think the last thing that we didn't really hit on was project management. Um, which is like its own beast in itself. But I think the project management department, that's where we kind of did a lot of ships. Sales has always been sales, right? It's like you sell, you build out the estimate, it's approved if you pass it on. But project management was like, whoa. Okay. There's so many facets to that. And we hired a lot of green people in project management, because that, I mean, truth be told that was all we could afford back then. I mean, they were still paid well, but they were greener in the industry and when I think back to those times, I mean, I don't know that I would have overly enjoyed that role back then either, but we didn't have expectations built for project managers. We have, we've always had that expectations guide, but there was always the struggle of where to draw the line with clients. Right. And to say what not to say. Yes, language.
Do you remember the story? When we had a project manager back in the day and, okay, this is how much we've liked the expectations. We've grown. Don't judge us for this, for where, Michelle, I'm about to take it. Cause I know exactly what you're about to say. Cause it's been so long. I know it's funny. Back then, we were like hands. Yes. You know, you learn. This project manager always dressed very well. Kind of like going to the beach. California surf's up. Yeah. But, and so with that look came sandals. And he always wore sandals every day. I wore sandals. I mean, I was a project manager, so I always dress cute. And I always said, "Sam, Nice sandals." Not flip-flops. Yeah. He wore flip flops. And you wore flip flops, and so this client was happy with something that was happening on his project and he called out our project manager on the site and said something like, "how am I even supposed to trust? You know, what you're doing when you show up to a job site in sandals?" And I remember he came back and told us that, and I was dying laughing. And I remember thinking like that was like the light bulb that went off in my head and were like, oh wait, no, duh, like, you shouldn't be in sandals on a job site. Like, it was just so funny because I totally saw what the client was saying at that moment. And I'm like, okay, holy serious, that this had to happen. And so then that was like, you know, you were close to her choosing. Yeah. You're saying sandal, it's a flip-flop. It was a flip-flop. It's a chocolate. It's your foot when you walk. When, you know, it's a flip-flop, you know. But so you live and you learn.
I mean project management though, evolved so much from the scheduling coordinator. Right. To the construction manager. To the two roles, Project manager and Construction Manager. Now we have teams and we have a north team and a south team. We realize the efficiency of that is game changing. When you have eight projects in south Austin. Why would you be wanting to drive to north Austin to check on something? We did. It's kind of literally like four hours a day in the car. Yeah, we lived in our cars. I lived in my car. It was, they were a mess. Your car was a mess. It was nice. Yeah. I mean, cause you're just like throw something over and drive. Yeah. Spilling over. And I'm like, don't get it on my sandwich. That was our biggest concern. You should've just dipped it in like an au jus sauce. It was odd. As you saw us.
Yeah. So those are forming quadrants nd I feel like that is why we really want to touch on those things because those are the areas in which we break our decisions down on a daily basis, whether or not we're thinking, "Okay, Sales and marketing. Do we focus on ops and people?" It's just, that's how we think. And we just haven't titled it and labeled it before.
But that's a great approach when you're thinking about how you're operating and what you're considering as far as next steps for growth in your business, and how it affects each other's stage. Like when we make this change in project management, how is that going to affect sales? Ooh, yes, because proactive hiring instead of reactive hiring. But if we bring on a new salesperson, then we need to be proactively searching for a new project manager because Dole starts to get clients situated. I mean, our sales cycle is anywhere from 90 days to six months to a year, depending on the size of the project, but we're going to need a project manager on the other end for all the new sales we're going to get. And it's so you're like hiring for capacity that you don't have yet, which is so scary. Yeah. Wow. We could totally go into another episode of that because how many times we hired and then we were like, "Yay. They brought in business." And then we didn't have enough managers to deal with the business. And we're like, ah, oh, And now we have this rush to hire a project manager. Whew. Yeah. Yeah. And then we were temporary project managers or temporary sales or whichever it's always going to be a little heavier on one side because you're planning for the growth. So, take that for what you will.
Okay, so we're going to wrap up. Yeah. So episode three wrap-up we hit some really high notes that we'll put as a summary in the episode. And next time we'll be talking about being women in the industry. And what that looks like. Great. Peace out.