Qualified Remodeler Magazine

MAY 2014

Qualified Remodeler helps independent remodeling firms to survive, become more professional and more profitable by providing must-have business information, namely best business practices, new product information and timely design ideas.

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M uch like most p e o p l e 's e y e s become bigger than their stom- achs when plat- ing a Thanksgiving feast, most people's eyes are bigger than their pocketbooks when it comes to remodeling their homes, according to an online survey Qualified Remodeler conducted. In fact, 93 percent of remodelers surveyed indicated a client's vision exceeds the budget half the time, most of the time or every time. INVESTMENT LEVELS Before the first wall is knocked down, the first nail hammered or the first brush of paint applied, a remodeler must work with his or her client to establish a detailed budget so there are no surprises along the way or at the end. "We stay on target by starting with a very straightforward discussion with the potential client," explains Bill Simone, president of El Segundo, Calif.-based Custom Design and Construction. "For us, it really doesn't matter what the budget is because anything, within reason, can be designed. It's just a question of what level of investment the client is interested in." In fact, Simone doesn't even use the term budget with clients; he prefers the term "investment level." Simone continues to discuss how remodeling is based on a partnership with the client. "Partners need to be able to communicate and get along, and they need a mechanism in place to facilitate that communication," he says. "If you can have that discussion, not only do you have the opportunity for a very beautiful outcome, but also a process that everyone can live through and still be friends." During the initial meet- ing with a client, Howard Chermak, CGR, CAPS, presi- dent of Edmonds, Wash.-based Chermak Construction immedi- ately tries to steer the conversa- tion to what a realistic budget range is. "The negotiation starts at the point of what their num- ber is versus what is realistic [for the work they want to have done]," he says. "We don't care how unrealistic the number is; we just need to know what they're thinking so we can adjust our pricing and product to be in the range they want to be." If there is a large difference, Chermak notes this is the appro- priate time to see if there is any leeway to increase the budget and decrease the scope of work. "Remodeling is a compro- mise," Chermak says. "If you get one thing it likely means you won't get something else. It's really a matter of discovery. That's what design is doing — discovering." SETTING PRIORITIES S o m e b u d g e t v s . d e s i g n discrepancies arise because clients don't understand the amount of money necessary to achieve their remodel visions, and they need to decide where to make sacrifices. "The question to the client becomes 'What if you can't accomplish everything you'd like to for the desired investment level?'" Simone says. "We'll let them answer it. Maybe they'll scale back on things, ask for help in selecting more cost-effective materials, phase the project where they do a portion now and a portion down the road, or maybe they'll go somewhere else." Using its trademarked Design2Completion system, Simone and his company embark on what he says is a slower design process than most, but one that is "extremely thorough and has no hidden upcharges to the client," Designing to budget When clients' wish lists exceed their budget, remodelers have several options to make dreams come true Remodeling is a compromise. If you get one thing it likely means you won't get something else. It's really a matter of discovery. That's what design is doing — discovering. -Howard Chermak How often does a client's vision (wish list) exceed the budget? % 62 19 12 6 Most of the time Half the time Every time Not too often 40 May 2014 QR ForResidentialPros.com PROFITS: Survey Series | By Laurie Banyay QUR_40-42_SurveySeries514.indd 40 4/28/14 10:26 AM

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