JULY/AUGUST, 2013 Volume 1 No. 2 YPS Team Overcomes $85 Million Charleston Manufacturing Plant Challenges Industry Spotlight: John T. ‘Tommy’ Parker Negotiating Construction Equipment Leases Sometimes, Thinking Inside the Box Can be a Good Thing Five Steps to Leverage a Changing Business Environment 8 9 11 12 YPS Team Overcomes $85 Million Charleston Manufacturing Plant Challenges Heather Seftel-Kirk, South Carolina Construction News The construction of a 409 ft. tower for the Nexans’ extra high voltage cable manufacturing plant in Charleston is now complete thanks to the work of an experienced con- struction team, under the direction of Greenville, SC-based general contractor Yeargin Potter Shackelford (YPS). The tower is the hub of the extrusion process and pivotal for the entire operation. This milestone is the first step to- wards the completion of the state-of-the-art operation by 2014. The $85 million project at the Bushy Park Industrial Com- plex has provided opportunity for the Carolinas’ construc- tion industry and will create 200 new jobs when it opens. PARKER MARINE CONTRACTING CORP. PILE DRIVING MARINE CONTRACTORS Congratulations to YPS Construction We are Proud to be Part of Your Team John T. Parker, JR., Vice President Ph: (843) 853-7615 Fax: (843) 853-6263 Cell (843) 693-3743 P.O. Box 30651 Charleston, SC 294417 johnp@parkermarine.net 2 – July/August 2013 — The South Carolina Construction News Nexans, based in Paris, France, is a multinational manufacturer. YPS project manager Chris Mc- Garr explains the first of the proj- ect’s complexities. “The location of the plant on the banks of the Cooper River meant we were deal- ing with groundwater 5 ft. down,” he said. “We used well points with underground piping and large above-ground pumps to manage this.” Excess water on the 30-acre flat site is being diverted to two large detention ponds at either end of the site and fencing all along the banks has been installed to prevent ero- sion. “The detention ponds will fill to a certain level, allowing the silt and debris to settle at the bottom, and then the clean water will be diverted back into the river,” says McGarr. The site has another major chal- lenge – it is on an earthquake fault line. While perhaps not normally a critical issue, the facility’s manufac- turing process relies on the large above-grade tower, which includes a 30 ft. basement. “We had chal- lenges with the basement because of the water table and then we had this massive tower to consider,” he says. Understanding that ground accel- eration in an earthquake is more fre- quent higher up, slipform experts Borton LC and design partner River The South Carolina Construction News — July/August 2013 – 3 PHOTO: AERO PHOTO MATERIAL HANDLING SLIPFORM SILOS INDUSTRIAL CONSTRUCTION ENGINEERING REPAIR AND RENOVATION The Borton Team salutes YPS for an impressive, on budget, on schedule project! John E. Kretzer, CEO www.borton.biz 620-669-8211 4 – July/August 2013 — The South Carolina Construction News Consulting were called in to design the tower’s concrete shell. “Being on the coast there is also the issue of winds,” McGarr said. “Borton had a big challenge here because the tower had to be designed to withstand a double whammy – a possible earthquake coupled with a coastal hurricane, with potential wind loads of 150 mph.” Joe Bleger, sales representative for Borton, says the tower was difficult, both to design and construct. “This structure is unusually tall for the industry. While there may be smokestacks for facilities like power plants to greater heights, this is a manufacturing tower with multiple floors.” Bleger says the design requirement called for a sway limited to one and a half inches from the ground to the top, which he calls “a tough tolerance to maintain and design into the structure.” “The tower required a rigid reinforcing structure, which was driven as much by seismic conditions as wind loads so it is heavier in terms of pounds per cubic ft than a typi- cal slipform.” The concrete tower, designed as a 14-story structure with steel inlays as flooring, presented other challenges. “We are using a crane to lower steel, starting at the first floor of the tower and then we build our way up,” says Mc- Garr. “To allow for this, the tower had to remain uncapped and the combination of a wet winter and wet spring meant many days we couldn’t work.” Despite the delays, subcontractors have been able to step up their schedules when the weather is good for con- struction. “We’re working 60 and 70 hour schedules where we can to make up for lost time,” says McGarr. “Everyone understands we have a time-line to meet so the owner can get in and install their own equipment and we’re committed to meeting that.” YPS’s experience as general contractor with two similar Carolinas manufacturing facilities has proven valuable to the complex construction project. The contractors’ team – including qualified subcontractors – has worked other mas- sive projects in Abbeville, SC and Huntersville, NC. “We partnered on these projects with Walker & White- side, Jennings-Dill, Palmetto Automatic Sprinkler and Bor- ton,” said McGarr. “It has been a major asset to the client to have subtrades experienced with the design and processes involved. For us, the relationships that exist - with everyone knowing the expectations and understand- ing the deliverables - have been very beneficial.” YPS project superintendent Steve Terrell says the con- tractor knew from experience to use a tower crane over a conventional model. “The tower crane is a bit more costly but it can operate more safely in high winds and eliminates that weather element as an extra delay.” Other subcontractors added their own areas of expert- ise, including locally-sourced Parker Marine Contracting, who coordinated the tower’s specialized pile driving. “Cooper River marl (lime-rich mud containing variable amounts of clays and silt) is a very different type of soil. The soil report had identified it and locals expected it but it’s not easy to work with, isn’t good for loads and could have been a problem with what we needed to do,” says McGarr. “Parker Marine’s expertise here was invaluable.” Parker’s project manager and estimator Marty Swain says misconceptions about the soil could have cost the project additional time and money his company was able to avoid. “The original soil report suggested either con- crete or pipe piles as options. The final report though made a strong recommendation for pipe as the only option.” Bleger says soil conditions were a concern and a great deal relied on the stability of the foundation, which had to be very stable and support the tower loads. “The soil is liq- uefiable under certain conditions so we had to be ab- solutely certain of the foundation stability.” Pipe piles have to be milled in Birmingham, take weeks to schedule and then would have to be transported to the site. Concrete piles are manufactured locally and installed by Parker. “We knew the concrete piles would do the job so we went in with 12 in. and 14 in, 100 ft. piles to test the site and validate that concrete would work. The results were confirmed by a geotechnical expert and we estimate this saved the project about two months and $400,000,” says Swain. In business since 1952, Parker Marine has a reputation for getting the impossible done. In this case the impossible was punching piles down to an elevation of 30 feet below ground for the installation of the tower’s basement. Swain says: “It’s normal in this business to use punches or fol- lowers to get piles to the right depth. What isn’t normal is getting them this far down. Four to five feet is what you might normally expect.” Fifty-five-foot-long 14 in. square piles set were set on cap heads and cushioned by six to nine-inch plywood and then driven to the proper depth with a 40 ft. long follower. Parker also installed a circular coffer dam on the site. The plant also required a unique electrical substation. “A lot of large electrical loads are needed to manufacture these cables and they are all tested using high voltage transformers,” says McGarr. “To supply this draw South Carolina Electric and Gas (SCE&G) had to build a substation on site. Walker & Whiteside were very involved with this The South Carolina Construction News — July/August 2013 – 5 Charleston Manufacturing Plant element of the project, which required a lot of co-ordina- tion. The substation has been energized and is ready for use.” Elijah Murphy, vice-president of Walker & Whiteside, says his company provided design and project manage- ment for the project’s electrical components. “The biggest challenge in constructing the substation was the coordi- nation of the various elements and diverse suppliers,” he says. “We used local supplies where we could but most of the equipment came from overseas. There were days that site access was limited due to high water or weather, so there was a lot to co-ordinate.” Walker & Whiteside used local labor, combined with a core team who had experience with the previous projects of this kind. Murphy says solid, proven methods, con- tributed to the project’s success. “Each project has its own challenges but we knew what to expect and had experi- ence we could draw on.” While McGarr says this type of facility does not typically seek LEED points, a reflective roof and concrete reflective pavement will be used and indoor air quality is a focus. “This type of plant would not normally be air conditioned but because of the processes involved and the heat and humidity in the Carolinas, air conditioning is being in- stalled.” McGarr says communication and co-operation is vital for the project’s success. “Nexans eliminated complica- tions that could have come from their geographic distance 6 – July/August 2013 — The South Carolina Construction News through a representative who was on-site full time. The building designer visited Charleston monthly to ensure the construction met the design requirements.” Terrell adds that the team always had good access to both the architect and engineer and that tight co-ordination was also critical. “We met regularly with the owner’s rep- resentative and all of the subtrades. We’d go through what was happening for the coming four weeks so people could plan for staff, ordering and deliveries,” he says. “No one was ever caught unprepared.” Terrell says YPS focuses on attention to detail and smooth communications. “When you’re in a business like this you want to ensure the owner feels you’re doing every- thing you can to get the job done right,” he said. “That’s a philosophy we live by and one reason we choose to part- ner with companies we know and know we work well with.” Swain says YPS is a professional partner and did a great job in coordinating the project’s massive effort. “We had contact with the owner rep at the start of the project but after that relied on the expertise of YPS to act as the go- between. Throughout the project we appreciated their can- dor and honesty in the way they communicated,” he says. He added that YPS representatives were always very clear in providing direction. They were up front with what was required, and reasonable in their expectations. As the industry changes and business owners and con- tractors come to understand there are other ways of doing PHOTO: AERO PHOTO things, the Nexans project model seems a viable alterna- tive. “YPS tends to build relationships,” says Swain. “More and more you see companies building teams like this. The low bid process is important but across-the-board people are realizing prequalification to ensure jobs are done right, on time and within budget, are all just as im- portant. YPS focuses on including everyone involved as part of the team and showing them the respect and con- sideration they deserve for their efforts.” Murphy agrees the relationships established through prior shared work experience benefited this project. “On both the design side and in the field there were people who knew each other, and had experience working to- gether. That ensured better communication and a good understanding between everyone involved on this project from the start, right through to the final stages.” Bleger agrees the relationships and trust established through the earlier projects played an important role here. “We were asked to design-build a very unique compo- nent. YPS trusted us to know what we were doing and get the job done. This is a structure unlike any other and we are pleased to have had the opportunity to be in- volved, and be part of the team.” Swain says his company is proud to have been part of this project. “This project deserves recognition as some- thing that will help the region through its job creation and the industry through its example of a job done well.” 3 The South Carolina Construction News — July/August 2013 – 7 INDUSTRY SPOTLIGHT: John T. ‘Tommy’ Parker In 1952 Tommy Parker started Charleston-based Parker Marine on a shoestring and a dream. Turning 90 in June, he has a wealth of experience and knowledge he contin- ues to bring to the industry, both through his own company and through his generous involvement in the industry at large. After the war, Parker went to work for a dredging con- tractor, performing the survey work he had learned in high school. When work dried up and he was laid off, Parker recognized a demand for the construction of small docks. He rented a boat and barge and got to work. Along the way he was asked to help build a steel bulk- head in Maryland. Salvaging a crane from that job he re- turned home and added foundation work for homes and small commercial buildings to his portfolio. John Parker is receiving the Virginia Casey Short Award (2007) from father, Tommy, who was the first recipient of the award in 1991. Tommy Parker celebrates his 90th birthday on June 28, 2013. An opportunity to drive concrete test piles for a paper mill in Georgetown opened doors, both for pre-stressed piles in building foundations and Parker’s next venture, when he opened his own yard. Now, with his son John by his side for the past 25 years and many long-term staff, Parker Marine owns six acres of waterfront property, nine cranes, four barges and three tug boats. The company does not shy away from challenging projects, but instead seems to embrace them. Parker re- calls several jobs in which access was so tight, concrete had to be poured using a helicopter. A humble man, Parker credits his company’s success to the people who have worked alongside him. “Our biggest asset is the people who work with us. We have first class staff who are willing to work hard to get the job done. We wouldn’t be where we are without them.” Here’s what people are saying about Tommy Parker: Our Congratulations to Tommy Parker Covering the Carolinas Mt. Pleasant SC Spartanburg SC Charlotte NC Research Triangle Park NC 843-388-1704 864-327-1504 704-454-5214 919-544-5198 www.skandco.com 8 – July/August 2013 — The South Carolina Construction News Bill Snow, president Palmetto Gunite Construction “I’ve known Tommy for more than 30 years and for me, he’s a mentor. He learned the hard way how to go from being a tradesman to being a contractor and through his example and direct teaching, he shared that with me. He took a chance on me, and has taken a chance on many young people. When I try to do the same for people now, it’s because of his example to me.” _______________________________ Continued on page 10 Guest Editorial by Lawrence C. Melton and Tracy T. Vann Negotiating Construction Equipment Leases Getting Beyond the Battle of the Forms In today’s economy, it is no longer practical to expect contractors will own all of the equipment utilized on a large commercial project. The cost of excavators, track hoes, trucks, scaffolds, compactors and other large equipment is simply too expensive to pay for in full, the financing too difficult to come by, and the maintenance and cost of re- pair too unknown, not to mention the risk the equipment could be taken by potential creditors down the road. Con- sequently, in lieu of purchasing large equipment, contrac- tors now, more than ever, are leasing large equipment from equipment rental companies. While there is certainly nothing wrong with leasing equipment, savvy contractors need to be leery of the standard equipment lease contracts provided from rental companies. These con- tracts are typically ambiguous and contractor unfriendly, provid- ing hefty costs, fines, interest and repair rates to contractors in the event of mechanical failures or defaults; yet providing no re- lief to the contractor in the event of a breakdown, unavailability, or other issues that may cause delay on a project. Unfortunately, contractors are often in such a rush to mobilize, equipment leases are rarely properly negotiated. This article examines standard terms contained in most form equipment leases and dis- cusses the need for negotiated leases on the front-end of the construction project in order to avoid contract ambigu- ities and issues with contract interpretation down the road. A standard equipment lease typically provides a date of delivery; payment terms; place of delivery; quantity; unit price; maximum allowable hours per month per piece of equipment; length of rental; terms regarding damage (i.e. normal v. excessive wear and tear); and terms for repair and maintenance. While the date of delivery, quantity, and unit price change, all other terms are generally boilerplate language. Problematically, this leaves ambiguities in the contract that can cause significant issues for the parties in the event of a dispute. For example, assume the contract calls for 160 hours of usage per piece of equipment per month. What happens if you go over the 160 hours? How do you determine the rate? How do you calculate allow- able usage? Assume you go over 10 hours one month but then only use 150 hours the next month – is that a wash, or is there still a penalty? Similar concerns arise over the length of rental. Assume the contract is for 12 months, what happens if there is a project overrun? Unless you have previously negotiated terms for that event the rental company could potentially hold you hostage and charge you a significantly increased rate. Alternatively, what if the project is completed early? Is there an early termination fee? Are you required to pay for the full 12 months. What if the lessor fails to deliver the equipment to you on time, causing the lessee delay on the project? What if the equip- ment fails during the project? Who is responsible for the repairs? To what extent? Is replacement equipment avail- able? If not, who is responsible for the delay on the project while the equipment is getting re- paired? What about performance standards? Is the lessor providing the lessee with any sort of guaran- tees? These issues, and issues sim- ilar to these on all of the above standard terms and other non-stan- dard terms, are why it is important for savvy contractors to negotiate these leases prior to execution. Fail- ure to negotiate these terms on the front end often leaves both parties with an ambiguous contract, leading to time consuming and expensive lit- igation in the event of a dispute. Issues concerning negotiation of these leases aren’t aided by the way they are typically ex- ecuted. The lessor (equipment owner) and lessee (GC or subcontractor) are rarely in the same city – and may not even be in the same state. The lessor typically sends a form lease to the lessee that includes blanks filled in for the lease rate and term and a set of general conditions. The lessor’s lease form may be very one-sided, particularly as to maintenance of the equipment (all) and the condition in which the equipment will be returned (perfect). The les- see will review the lessor’s form lease and either mark it up before signing, or attach its own purchase order (PO). The lease can be executed in any number of ways: • The two forms (lease and PO) will cross in the email, and the parties will sign both; • The lessor will cross out parts of the lessee’s handwritten material and then sign; • The lessee will incorporate the terms of its PO by reference; • Sometimes only one party will sign a form agreement; or • Neither party will think to sign anything, because in most cases the people exchanging the forms are not authorized to sign contracts for the company. _______________________________ Continued on page 10 The South Carolina Construction News — July/August 2013 – 9 Leases Continued from page 9 _______________________________ Based upon the above, when a dis- pute arises concerning the lease, multi- ple disputes are going to arise over which terms govern, and how those terms are to be interpreted. Construction equipment leases are governed by both state common law governing contracts, including the Re- statement of Contracts, adopted in both North Carolina and South Carolina, and portions of Article 2A of the Uniform Commercial Code, governing leases generally, also adopted in both North Carolina and South Carolina. However, in the event of ambiguities, the law does not provide a clear path for resolving dis- putes that arise between the lessor and lessee, and the Court will not write a contract for parties that have failed to agree. In order to try and interpret the contract, certain presumptions arise; however, these presumptions are by no means perfect and may lead to a less than perfect interpretation of the con- tract. For example, the Restatement (Second) Contracts (1981) (hereafter, the Restatement”) § 204(4) states that the Court should look at the parties prior dealings and course of performance as indicative of contractual intent. Restate- ment § 206 provides that ambiguities in a contract are construed against the drafter. While at first blush application of the above sections may not seem problem- atic, what happens when the lessor signs the lessee’s P.O. on some, but not all of the leases, and does not specifi- cally object to those P.O.’s when pre- sented? Under § 204(4) that supports the lessee’s position that the P.O. ap- plies to all leases. Likewise, assume a 12 month contract limits hours of usage to 160 hours per month but does not de- fine how you allocate overall hours. The Court is going to construe allocation against the person who drafted the con- tract unless there is evidence to the con- trary. Also, under Restatement § 211, not all terms contained in the written contract may be given full force and ef- fect. Section 211 works two ways: (1) a party signing a form contract is charged with knowledge of the terms in 10 – July/August 2013 — The South Carolina Construction News Parker the form; (2) but, if the offeror knows that the offeree is unaware that an ob- jectionable term is included in the form, that objectionable term is not part of the agreement. The purpose of § 211 is to prevent the offeror from taking advan- tage of the offeree. How do you prevent application of section 211? The lessor will contend the lessee was aware of the objectionable term, while the lessor will contend it was not. Ultimately, what evolves out of this is a constant battle of forms, with no clear indication of contract terms, despite a written contract. While the Uniform Commercial Code has attempted to ad- dress this problem with Article 2 (some argue unsuccessfully), Article 2 does not apply to equipment leases, except by analogy. Under UCC Article 2A § 202, parol evidence, including course of deal- ings and prior performance, cannot be used to contradict a written agreement; however, it does allow for such terms to explain or supplement a written agree- ment. Thus, when you are dealing with a short, boilerplate, construction equip- ment lease, parol evidence is going to be able to be utilized to determine the parties’ intent and ultimately, the terms of the contract. Leasing equipment for the construc- tion project is, therefore, a matter that deserves close attention to detail as forms are exchanged and there is no substitute for a clear agreement. An ex- perienced, dedicated equipment man- ager is essential to the well-organized construction project. At the same time, a legal review at the time of leasing may save a lot of money when the project is being closed out. Lawrence C. Melton is special coun- sel for Columbia-based Nexsen Pruet, Lawrence C. Melton practices primarily in the construction law group. Melton is also teaching a class in Construction Law and Litigation at the University of South Carolina Law School. He can be reached at lmelton@nexsenpruet.com. Tracy T. Vann is a litigator practicing with the firm's Construction Group in Charlotte. She is licensed both in NC and SC and is currently chair of the SC Construction Law Council. Vann can be reached at tvann@nexsenpruet.com. Continued from page 8 _______________________________ Described as a gentleman, but not at all soft, Snow says Parker comes from a genera- tion based on honesty, in- tegrity and a desire to help. “Tommy holds true to the val- ues of his generation. He does- n’t realize how much he helps people because it’s just what he does, it’s who he is. He has always had a hand-on devotion and dedication to his family, his friends and his business, and in fact, to the industry.” Parker is a former president of the American Subcontrac- tors Association (ASA). Snow says Parker led the process in- troducing prompt payment leg- islation. “Tommy spent a ton of his own money and time flying back and forth to Washington. It took him a few years but in the end he got a resolution to have the federal government pay, then pay on time, then set what the timeframe should be for that payment. The federal prompt payment act followed.” Linda Burkett, executive director American — Subcontractors Association of the Carolinas “Tommy has a heart of gold and has done so much for us and for the national association as well. He has such great sto- ries about his years in the in- dustry and lessons he’s learned. When he talks, people listen.” Burkett says Parker spent a great deal of his time traveling around the country promoting the association and is still as active today. “He’s at every Charleston meeting voicing his opinions and sharing his knowledge. When he can’t at- tend something he makes sure he makes it easy for someone like Marty to be there on his behalf. If there is anything he can do to help, you can bet he’s going to.” Sometimes, Thinking Inside the Box Can be a Good Thing material so that they don’t spend their time waiting and searching for it. We keep you up and running. Bridgestone Project Commercial construction projects are starting to pick up again, but life as a contractor still isn’t as rosy as it used to be. Competition is stiff and bids are still tight. Contrac- tors everywhere are looking for an edge. ”How can we be- come more competitive?” ”How can we win more big projects?” The unspoken question behind all of that is: “How can we employ labor saving products and technolo- gies to help us be more profitable?” Material handling takes up approximately 40% of a field worker’s time on the job. It is recognized to be the single most common cause of unproductive time on a job. Shealy Electrical and EDI want to get our customers the right ma- terial, in the right quantities, at the right place, at the right time. Our goal is to keep the installers installing. We use our expertise to facilitate the installation of our customer’s South Carolina Construction News is distributed throughout the Carolinas construction industry from offices at 127 College Avenue, Durham, NC 27713. SCCN is circulated on a controlled circulation list to qualified readers including members of most major construction associations in the Carolinas. For information contact: Bob Kruhm at 919-544-3719 or email rkruhm@nc.rr.com. ISSN 1940-3682. At a current Bridgestone project in South Carolina, we met with Greg Klein – Logistics for electrical contractor Feyen Zylstra (FZ). This is FZ’s first project in the area of the country and Shealy Electrical is honored to offer them job site solutions on such a high profile project. Feyen Zylstra has used Work Cell Boxes on past proj- ects, but not in the Shealy way. On past jobs, the boxes were set up at the beginning of the job with standard prod- ucts. A lot of the material wasn’t used and ended up being wasted inventory. Shealy is different. We work with our customers to set up our Work Cell Boxes with the most ef- ficient layout and with material that is project specific. Any- thing and everything in the Work Cell Box is sure to be used. Gary Breland, Shealy Account Manager in North Au- gusta, works closely with Greg to determine the right prod- ucts for the job. After looking at the job take-offs, they determined that FZ would need 8 Work Cell Boxes for the Bridgestone project. “It is crucial to get the material as close to the work areas as possible,” says Greg. “You want to minimize trips from the working area to the material storage facilities. We could lose up to 2 man hours if one of our installers had to walk from one end of the site to an- other! Now, our guys are working within a 300 ft. radius of where their material is.” Gary set up each box with the minimum and maximum of what the workers would use on a regular basis. “Each Work Cell Box cannot be set up with the entire bill of ma- terial,” says Gary. “It is crucial to correctly estimate the an- ticipated usage and adjust the inventory as the project progresses.” Gary’s expertise in inventory and mainte- nance help make FZ even more efficient when it comes to material handling. Management doesn’t have to worry about making sure they have every fitting, strap, nut, and bolt that they need. Gary keeps the entire inventory organ- ized and limits the clutter that occurs when a variety of hands are on the products each day. As an added benefit, Gary is at the job site on a regular basis, communicating with the foremen – discussing ma- terial usage and needs. This constant communication al- lows Shealy to make adjustments quickly as the project moves forward. On a productivity and financial basis, Greg calculated that the Shealy Work Cell Boxes save them about an hour per day per installer. FZ has 50 installers on the project at a time working 50 hour work weeks. “That saves us one guy’s weekly pay per day!” Greg exclaimed. Our thanks to Shealy Electrical Wholesalers for permission to reprint this article from The Circuit, Spring & Summer 2013. The South Carolina Construction News — July/August 2013 – 11 Leverage Five Steps to Environment a Changing Business Guest Editorial by Lee Richardson, Successful Ventures Coaching and Consulting The story goes: “A leading University did a study a few years ago and made three predictions for the coming year: 1) there will be more changes than ever before. 2) more competition than ever before. 3) there will be more oppor- tunities than ever before.“ This seems to have held true for many years. Most readers missed the conclusion of the study: “Those who do not adjust to the rapid rate of change, respond to the increase in competition, or take ad- vantage of the new opportunities will be out of their jobs within two years.” For several months indicators have shown a broadly im- proving economy. Unemployment is trending down. Con- sumer confidence is trending up. The stock markets are at record highs and politicians of all flavors are claiming credit. How do you and your business prepare to take ad- vantage of this much improved situation? Here are five steps that will help you along the way: 1 HAVE A PLAN. You should know where you are in terms of financial and operational performance. Where would you like to be in 6-12 months? Start with that vision and work backward to your reality. What changes do you have to make to realize the results that you want? What do you have to do to make those changes reality? Make sure your plan includes follow up and ad- justment points. 2 HAVE THE RIGHT TEAM. This may be the hardest task of the leader. You must be realistic and honest in your appraisal of your entire team. Does each mem- ber regularly hit their performance goals? Do they repre- sent your company well? If they can’t grow and carry you into the future you need to make a change in responsibili- ties. The really hard part of this is to evaluate yourself. Are you staying abreast of industry and technological develop- ments? Are you hitting your performance metrics? We tend to focus on the under-performers. Don’t forget to identify your over-performers as well. They are probably the future of your company. Develop and nurture them. KNOW YOUR NUMBERS. Start with your operations. Know your cost inside out and upside down. I see too many businesses owners who wonder why they lose money on a job…until we go back and look at their cost. In some cases, they didn’t even cover direct costs. Once you establish your fully loaded cost, the only number to adjust is your profit percentage. Do not cut too closely on profit! Now understand your sales numbers. There is always a relationship between the number of bids/prospects and the number of jobs that you actually get. Understanding this ratio will let you project your rev- enue over the next several months and will also provide guidance for your sales team on their activity levels. 3 4 KNOW YOUR COMPETITION. Understand the things that they do well and the things that they don’t. Make sure your sales team is selling your strengths, and not running down the competition. When you look at your competition, is there a hole in the market that is under-served? Are you positioned to exploit that hole? 5 Helping you chart your course to success 803.431.9493 phone | 866.285.3818 fax info@successful-ventures.net successful-ventures.net 115 Doby Creek Court, Fort Mill, SC 29715 12 – July/August 2013 — The South Carolina Construction News KNOW YOUR CUSTOMERS AND THEIR INDUSTRIES. If your customers are in declining industries, it’s prob- ably time to look for some new customers! Many of our businesses were set up to serve the textile industry, or the hospitality industry, or the financial services industry. All industries have ups and downs. Those fluctuations don’t have to spell hard times for our business, as long as we are aware that they are coming. Make sure that you and your business don’t miss the conclusion! Lee and Lauren Richardson formed Successful Ven- tures Coaching & Consulting, Fort Mill, to help business owners and executives navigate the many challenges they face each day. Lee is an Army veteran, graduate of Wofford College and a native of upstate South Carolina.