Featured Coaching Training: Selecting a General Contractor: What to Look For
It’s the contractor you pick that makes — or breaks — your remodeling project. Finding the right contractor for your job will determine the quality and timeliness of the work, and the amount of emotional and financial stress you’ll have to deal with. Learn how to effectively choose the right contractor for your needs in this series.
Featured Coaching Excerpt - Notes & Transcript, Part 1
Today's Guest: Thriver of the Month - Augustine Iacopelli (Augustino Brewing)
Lesson Nugget: Typically, if your job requires more than three subcontractors, a general contractor may be a good idea.
PRINCIPLE #1: Observe the rule of 3.
Lesson Nugget: Have 3 contractors that you like in order to get the BEST deal. Having three options gives you negotiating power!
Lesson Nugget: How to know if you like the contractor:
3. Quality of their work
4. Has at least 20 references
Lesson Nugget: The first thing to check with a contractor is if they are licensed.
- Don't get into that cycle, and I'm just telling you this cause literally, in my life time it's cost me and I'm not exaggerating. $400,000.
- And we are back. We are here, broadcasting live to 45 countries worldwide. We're joined today with Clay Clark, The U.S. Small Business Administration Entrepreneur of the Year, and Augustine Iacopelli. He is the founder of Augustino Brewing, and he is also one of the Thrivers of the Month, and we're excited to be sharing his success with all of you Thrivers. He is a product of the Thrive15.com trainings, here in the studio, and we're excited. Clay, what do you have over there?
- He brought this, Augustine what would you describe this? This is a gift he brought me. What do you call this?
- [Augustine] It's a bottle opener or more technically speaking, it's a bar key.
- A bar key that I can use to key a car or to open up an adult beverage of my choice, right? And so what you do, is you just pop it on there and bam, you're in, right?
- [Augustine] You bet.
- That's awesome. So thank you for this gift, man. I'm excited as you're turning your vision into reality. It's so exciting. You're an encouragement to Thrivers all around the world. Cause so many people have these ideas, and then they don't act on them. And it's never talking about the brass tax of how do you go out there and you find a contractor? There could be nothing more specific than how to find a good contractor. So, we're going to teach you how.
- [Marshall] So Augustine, tell us where are you in the, what stage of the business are you in where you're needing a general contractor?
- Well, right now, I've got a business plan, slide deck, all those goodies, and I'm at the stage where I'm starting to talk with bankers and my architect as well in terms of getting the layout that we're looking for, getting the location, and those pieces are gonna fall into place looks like fairly quickly and so I'm being asked, "Well, who's your general contractor?" I don't know.
- So, Thrivers, we're going to talk about a couple specific principles and some super moves to avoid that we'll get into that a lot of general contractors they like to pull some of these super moves, but we're gonna get into these principles. The first one being, "observe the rule of three," okay. The rule of three. Clay, what is this rule of three and why do we need to follow it?
- Find three contractors that you like. Three that you like so you and your wife, now your wife is going to be a big part of this, so I'm just kinda looking at you too, okay. So when you find like, you talk to ten and you find one you like, remember this and go find two more. Cause when you have three, now you can negotiate. Until that point, you're gonna internally not have enough confidence to negotiate properly. And it's whoever has the mindset that they don't care. You know if the deal gets done. That's the person who gets the best deal. So if you have the mindset where like, "Hey, we already have three options, frankly. "And well you do a good job, this guy does a good job, " that person does a, but we just want the best deal." You have the ability to walk away now. You can go, "You know what? "It's not a good deal. I'm done." And when you do the walk away, then they're like, "Wo wo, come come come back," and then you get a good deal. So I'm just trying to make sure we're getting this. You have to have three that you like. Not just three. Three you like.
- [Augustine] How do I know if I like them?
- Well one, is just on the whole personality thing. I mean, if they just annoy the crap out of you, you don't want to work with them. Cause you're gonna be working with them for five months, six months, whatever. Two, their ethics. If they're not ethical, if they show up late all the time, and they're disorganized, and their quotes are always off, run away. Third, is just look at the quality of their work. I mean, the quality of their work. Do they have a good portfolio? And a Reid Hoffman thing here, Reid Hoffman, the LinkedIn founder, he's all about like calling references. Like have a ton of references. Not like have five or 10, but I'm talking like 20.
- Then you'll like him.
- [Marshall] Now, Clay, I've seen you do this, because I've seen you work with a number of different clients, I've seen you work with general contractors on a regular basis.
- [Clay] Yeah. Is this just to secure a contractor the first time or should you always have three? I mean, how frequently does maybe a general contractor fall through or you have to move on to the next one mid-project or, tell me a little bit about that. How frequently should I have three people on deck ready to go?
- I would say 95% of the time that you have one contractor option. Your business, your build out will be a complete disaster. So, this is an example, this year, I have worked with a dozen, more than a dozen, probably 15 business owners that I'm trying to look at both of you and your wife because this is gonna become very, very personal thing for you guys. I'm just telling you. We're all scammed and screwed. I don't know one of the 15 that went through a build out that weren't scammed and screwed. And the only one that I can think of that I know of, who wasn't a client of mine that didn't get scammed and screwed, was the person who came to me like, "What do I do?" And I told him the say rules, and he literally had three ready to go, and he felt confident. He called the references and he found a good one, and he had no issues at all. It was great, but he had gone through the due diligence. Most of you managing a contractor, you shouldn't have to manage him at all really, which is about choosing the right one. So that's what we're talking about today.
- [Marshall] Okay, and so we're gonna talk about how to effectively manage those contractors.
- [Clay] Okay.
- Observe the rule of three. That is such a good tenet, a good principle to start with, okay.
- [Clay] Yeah.
- And that's why it's the first principle here.