Premier builders don't just attract the best tradespeople, but keep them. In the following 12 steps, we outline the best way to keep top–notch skilled workers happy and working for you.
Note that these 12 steps aren't simply tips for your operating practices– the steps will help you build a great work culture in your company. By taking the time to understand– and incorporate– each step, you'll be on your way to greatness.
1. Pay promptly and equitably.
All too often, a business’s systems and processes can be ill-equipped to smoothly and seamlessly handle the demands of high-growth phases. Whether the snag shows up in scheduling, communication or issuing POs, growing pains in these areas can gravely impact the connection between builders and tradespeople.
Most builders believe they are doing well if they pay twice monthly—and they are. Yet some are still stuck paying at 30 days, 60 days, or even less frequently. Such untimely payments are uncompetitive and can result in the loss of good trade workers.
CLB’s Builder Benchmarks can help with retaining great trades and maintaining excellent relationships with them. Our Team & Hiring Benchmarks will help you to identify areas in which your payroll regularity can be improved and how you can increase your success in hiring practice so that payments to trades can occur in a more timely manner.
2. Show tradespeople the utmost respect and dignity.
The last three decades have seen a monumental shift in this area, thanks to younger generations now occupying the workforce. The grizzled veterans of yesteryear who employed intimidation tactics are no longer around; they have been replaced instead by kinder, gentler managers who prefer negotiation over force when it comes to problem-solving. These new leaders understand the importance of a work environment where everyone is heard and respected, which ultimately results in better outcomes.
The best supervisors– and their companies– ensure proper professional and respectful treatment of all of their workers in order to keep the best personnel around and help their companies thrive.
3. Establish a safe and hygienic jobsite.
The pandemic reminded everyone that a work site is not safe and secure unless it’s also kept clean. With OSHA increasing its presence, all companies– not just in construction– had to pay better attention to the conditions of their sites. The best construction companies don’t require government oversight to understand the value of– and to ensure– a safe work environment. Such attention to health and safety demonstrates your concern for your workers’s well-being, their importance to you and their value in your company.
It is in the best interest of everyone at your company to participate in safety education and enforcement– especially when employees consider that they pay a portion of their income into worker’s compensation insurance. An orderly work site is a safer worksite, and more pleasant to work in. Employees who contribute to a disorderly or unsafe work environment may not be the best members of the team to keep around, but the best workers know the importance of a safe and orderly worksite, and will not tolerate working in dangerous conditions.
4. Ensure your building personnel are well-trained and proficient in their roles.
After the housing market crash fifteen years ago, training outside of sales teams became virtually nonexistent. This lack of education has led to an over 90% decrease in demand for training services. This decrease is a grave mistake with clear repercussions: new home builds have become unpredictably managed, scheduled, and constructed, due to a reported inadequate standard of training.
How did construction workers find themselves severely lacking in training when the need for it is so pressing? When the crash happened, tradespeople who were left standing already had adequate training, and surviving employers filled their new positions with those experienced workers. There was no need to train new workers when a large pool of trained and experienced workers already existed. However, that pool of experienced workers has dwindled away and a lack of on-the-job training for newer workers has resulted in inconsistency and unpredictability. Thus, today there is a clearly demonstrable need for proper instruction for newer workers.
A benchmarking tool that CLB provides for project managers and superintendents can be of use to your company in the important area of equipping your new workers to succeed on the jobsite. With this tool, among the many other benefits provided, you will be able to identify ways in which your project managers and superintendents can help your trades achieve the high standards of excellence and performance that you expect and need on the job site.
5. Ensure fast access to builder staff for inquiries and assistance.
It's ironic that in this era of smartphones, emails and other communication technology, the difficulty of smooth coordination between builders, suppliers and trades remains the same. The key factors at play in this difficulty– schedule changes and variance– cannot be overcome merely by improvements in communications technology. They are improved by increased attention to communication (not by the smartphones themselves).
Schedules today have grown by an average of 50-100% compared to 15 years ago when the new technologies were first emerging, whereas variance levels have quadrupled. Such dramatic increases in schedule and variability correlate to drastic increases in communication workload.
Complexity of coordination between field staff, vendors, and purchasing, accounting and other internal departments abounds. Increasing complexity and difficulty of coordinating all members of a project necessitate employers’ constant attention to keeping employees up-to-date. CLB has the tools to help you organize your business, and your operations, so that all the members of the construction team– including tradespeople– know the latest relevant developments on a build, worker satisfaction will be greater, and you will be able to retain those great tradespeople.
6. Double-check your bid packages to guarantee that all information provided is exact and complete.
Crafting a successful bid package is no easy task, as there are numerous components that must be accounted for. To ensure your purchasing department puts forth an effective bid package, you should pay attention to details such as final grade, plans and elevations, trade scopes of work and contract requirements--just to name a few! Do not underestimate the importance of these steps; they can make all the difference when it comes to acquiring bids with satisfactory terms.
Without a high-quality bid package, do not expect to secure the most competitive prices from your trade partner. This is impossible without management playing an active role in decision making up front. Resolve to ensure that critical decisions get made promptly so your team can focus on their tasks and provide optimal results with maximum efficiency.
7. Guarantee that the starter packages are precise and comprehensive.
For the most accurate information on your bid and start packages, ask yourself this key question: “Does our bid package match our build (start) package?” To ensure a reliable response, enlist five of your brightest trades. Even small differences can accumulate to cost both parties money in the end. More often than not, these discrepancies turn out to be quite substantial! Make it a habit to always inquire about this for each home you're involved with.
If you find a discrepancy, the next step is to ask “why?” until you receive a clear answer (asking five times is a good rule-of-thumb). Our experience shows that approximately half of the problems arise from changes made to the product or decisions that should have been made earlier on in the process—even as early as the bid package. Any purchasing manager will tell you how difficult it is to create a complete start package when given an inadequate bid package. To avoid this issue, establish rules for this part of your critical path and follow them strictly.
8. Provide final plans with construction drawings.
Having final lot-specific plans with all the minute details included on full construction drawings is one of the most foolproof ways to avoid problems. You will never save money by cutting corners and taking shortcuts in this process, but we can guarantee that you will incur additional costs if you have to measure and account for errors, mistakes, rework, and lost schedule days. Sit down with your tradespeople and ask them specifically what they want on their plans and what they don’t need. Do that, and make sure those needs are built into the plans at the bid package stage every time.
9. Ensure that your construction timeline is rock-solid and dependable.
Your schedule is the backbone of your operation. After working with hundreds of builders across the nation, we can confidently say that if your schedule is off-kilter, everything else in your business will be too. You've likely seen how poor scheduling affects not just you but also ever single one of your employees, and even capital requirements. No exceptions!
Pay close attention to how your schedule impacts your trades. How many of your homes do you have to “scout” before materials are delivered or a work crew arrives? More likely than not, it’s an extensive majority, which is unacceptable, especially when you’re trying to attract and retain excellent trades. The best craftsmen will consistently choose to work for the best-scheduled builder, bringing with them the finest crews.
10. Eliminate variance purchase orders.
Your objective should be to reach zero VPOs. Although it might not always be possible due to unexpected events, the expenses incurred from this variance are usually higher than anticipated labor and materials costs. On top of that, there is a more significant impact on processes—such as extra scheduled days or excessive trips to sites—which adds even more overhead costs. Unfortunately, no one can perfectly eliminate all VPOs, which is evident given the escalating rate across the industry recently. However, striving to bring this number ever closer to zero will help with trades satisfaction and retention, as well.
11. Aim to make back charges an exception, not the norm.
It is important to recognize that a back charge signals failure for both parties. A thorough total cost analysis demonstrates that no one can benefit from this unfortunate circumstance. To prevent the need for back charges, ensure all other elements are correctly handled: pay close attention to the issues you may have that are causing the discrepancies, and correct these problems. Afterward, you'll likely find that the need for back charges becomes almost none.
Consider whether it makes sense to even pursue a back charge at all. Some of the most successful builders in America don't issue them: their systems won't permit it. Rather, these builders proactively pursue the causes of the discrepancies and adjust their processes to eliminate the problem in the future. promote proactive communication so mistakes become learning opportunities!
12. Make sure to get input from your trade partners early and often while creating plans or specifications.
Developing a high-end product requires creativity, expertise and often the input of 30 to 45 contractors. While you include their input in the actual construction process, you likely seldom consult with them during the designing or planning phases of the project. Your craftsmen can provide invaluable input to the designing and planning steps, as well as throughout the process, as they can course-correct or even provide small adjustments that can have a remarkable impact on the finished home.
The rewards of including trades throughout the whole of the building process are plentiful yet often disregarded. Not only will you make considerable savings by getting trade feedback for the duration of the project, but to solicit their input demonstrates to trades that you appreciate their expertise -- something they rarely experience from other builders. This can significantly impact their decision when choosing a builder to work with. If you’re the only one who gives such deference, the best trades will choose you every time.
A Vision of Operational Excellence
It's important to keep in mind the value of operational excellence as we evaluate these 12 points, which includes having virtually no trade turnover, a top-notch quality control system, and prices that are better than competitive. Maybe you aren’t sure in which area your business needs to improve. With the 3-minute CLB Business Audit tool, we identify the main areas where your business needs adjustments in order to launch you to greater success.
Maybe it’s a reality for you already, or maybe it’s still in the realm of your imagination, but picture this: schedules released with amazing precision sixty days in advance, so that YOU become the desired contractor. You have excellent plans, accurate start packages, expert personnel and impeccable timetables–so good that trades can charge you less than any other builder!
Now picture this: CLB is the company that can help you achieve the dream of operational excellence for ALL builders. Think about it--the day when your rivals complain incessantly about how unstable trades are driving them insane, you can simply relax with a knowing smile and say "Trade shortage? What trade shortage?"
The Certified Luxury Builders Network leads luxury builders to greatness. Since 2016 CLB Network and builders across the nation with annual sales ranging from $5M - $50M have worked together to deliver a 5-Star experience and become market-leaders. Working with one great company at a time, CLB gives builders the tools, training, and support to achieve success in Quality, Profit, and Pipeline freeing leadership to work on—not in—their business.
We're here to help builders. Experience and expertise is just a click away. Contact us today to see how your business measures up to our builders' benchmark, learn what "GREAT" looks like, and see how CLB can take your business to the next level.