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Hey gang…we are giving the guest posting another shot as we received a lot of very good feedback from our first posting from Chris Hill, construction attorney. Next up is Kevin Kaiser who is here to share with us about the importance of a strong bonding program. Hopefully, you will read Kevin’s post and ‘bond’ with what he has to share. (Sorry, I could not help myself…Bobby)

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Being in charge of your company’s bonding program is an important task. And often the people in the company consider the surety program to be a simple tool that should be dealt with only when absolutely necessary.

Unfortunately for you, this is not the case. If you want to succeed easily, then it’s important to be proactive when it comes to your surety program. Things change all the time, so staying current really helps when it comes time to secure the bond for your next project. Plus, we can always improve things, right? A good thing today could be great tomorrow as long as you take the time to care and grow it. This is exactly what should be done in your bonding program and here are a few ways to go about it to make sure you get the surety bond you need for your company to succeed.

Can You Call Me?

Having solid communications with your bonding company can really improve the service you receive and speed up the process for both parties.

Talk to your agent. Tell them what you need, what you expect, and make sure they follow through. If the surety makes a decision about something that you don’t quite understand, ask them. Setting up meetings with your agent on a regular basis can really help make sure your bonding program is on the right track and progress is always being made.

Also, making sure that you answer when your agent contacts you will help them provide better service to you.

How Much Are You Worth?

A big indicator a surety looks at is your net worth. In other words, do you own more stuff than you owe? Sureties look at this because it shows whether your company is going to be able to turn a profit in the long haul. It also shows if you can lose a wing without the plane crashing, so to speak.

For example, when considering two companies, the surety will most likely bond the one with the most net worth, so it’s something that should be definitely be on the mind of everyone in the company.

Another thing worth building up is your working capital. It’s often seen much the same as net worth (it’s the difference between current assets and liabilities), though it covers a much shorter period, usually the previous 12 months. Find your company improving these two things and bonding companies will be much more likely to write bonds for your company.

Last Tips

We all want our company to grow. It’s perfectly logical. Unfortunately though, there are many companies that grow too fast and flop. That’s why it’s important not to grow too much in the eyes of your surety. A good tip is to not try to do anything more than twice the size of what your previous job was.

Being honest really helps. If you decide that you’re going to wait to tell the surety that the project is not going as expected, you can sure to be find difficulties down the road when trying to get a bond. Just keep open the lines of communication with your surety and let them know anything that might be related to your bond program immediately so it can be dealt with efficiently.

Follow these tips and your bonding program will no doubt improve, allowing your company to take on larger contracts and in turn, grow your business.

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Kevin Kaiser is a principal at SuretyBonds.com, the nationwide leader in surety bonds. You can connect with him on Twitter, @suretybond or Facebook.com/suretybond.

Feel free to contact Kevin directly: kevin{at}suretybonds.com.

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Today is the Fourth of July.

While I will be attending the annual Darnell Family picnic and fireworks extravaganza, I will not be celebrating the ‘Fourth of July’.

I will however be celebrating Independence Day.

Now, for those who think I may be splitting hairs in game of semantics, allow me to explain. In Iran, North Vietnam, Syria and Cuba…they have a Fourth of July. Today we celebrate Independence.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.

Apart from topics of eternal themes, my family and friends, there is absolutely nothing I am more passionate about than my daily participation in free market capitalism. My daily engagement in building new business for Construction Market Consultants and for our clients has been made possible by those brave men who set the stage for this country to truly be the land of opportunity.

Have a great, safe, fun weekend everyone. After the holiday, it is back to churning the wheels of commerce and our pursuit of happiness.

Thanks for reading…

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Bobby Darnell is the founder and Principal of Construction Market Consultants, Inc. An Atlanta based management consulting group specializing in business development, sales, marketing and profitability as well as executive placement for the Architectural, Engineering and Construction industry.

Bobby can be reached at bobbydarnell [at] cmconl.com

http://www.cmconl.com

Having played guitar since I was a youngster, I have developed a deep appreciation for guitar players. Once, a friend asked me, “What is the difference between you and Sonny Lallerstedt?” (More on Sonny in a moment.) I replied, “I play guitar, Sonny is a guitar player.”

I could regale you, if you are a music fan, with Sonny Lallerstedt stories for the entire blog but I will make a point before I am done. Sonny is one of the best friends I have ever had, and without a doubt the most talented musician I have ever known. He played Phil Keaggy’s ‘Wedding In The Country Manor’ at our wedding, has played on hundreds of albums from Elton John down to people no one has ever heard of and he is as humble as he is gifted.

A couple of quick examples of Sonny’s musical abilities:

– When Sonny was 12 years old, he could play any song on the radio by Chet Atkins (His major guitar influence)

– Sonny has perfect pitch. You can put a guitar tuner in front of him, ask him to sing a ‘C’ and the tuner will indicate a spot on ‘C’.

– I was in his recording studio once when he was working on a project for the ‘Miss South Carolina’ beauty pageant; they were making a track of ‘New York, New York’. He had six horn players, all partitioned from each other but still playing/recording at the same time.

After they finished, Sonny had to point out to one of the horn players that at a certain measure, he played a ‘F’ instead of a ‘G’. Obviously, the trumpet player asked to hear the playback. Sonny ‘punched out’ all the rest of the horns so we would only be hearing the player in question and sure enough, the mistake was obvious.

There are so many other examples I could share but the bottom line is I have been very blessed to have so many experts at so many things among my circle of friends. When I am buying a new guitar, piece of equipment or whatever, I always ask Sonny’s input first.

Now, back to business; when Eddie Van Halen came on the scene, the tones he got out of his home-made, Fender ‘Stratocaster’ copy guitar were amazing. I once mentioned to Sonny how I would love to play Eddie’s guitar to get those sounds. He replied that it would sound different if I played it. (He was not just talking about the vast talent gap either.) That thought never left my mind.

When I got the idea for his blog, I dropped Sonny an email just to make sure I remembered this conversation correctly, that if I picked up Eddie Van Halen’s guitar, played it, it would sound differently. Sonny’s reply was:

You’re right! Everybody has a different touch. We might get close to the sound, but the little things that each of us does makes a difference.

This was good news for me. First, I would not have to abandon my idea for this blog and secondly, my memory may not be as bad as I feared.

As we try to build new business, we are inundated with solutions, tools, opportunities and experts all offering help. I have no doubt that we can all learn something…even from a blog like mine! The thing to remember is when you hear someone say “This is the way to do this.” or “This is the way to do that.” each one of us, no matter how closely we follow the recipe, will have a different result because of, just like Sonny said, we all have a different touch.

It you play guitar or are a guitar player and you want to improve…read a book, attend a seminar/webinar or even better, take a personal lesson that will help you develop your unique touch. What may be comfortable for me to say in front of a building committee will be different than what you would feel comfortable saying. If you are in charge of growing revenue and/or increasing profits for your company, I believe the same holds true.

There are many solutions out there that will help you grow your company, just remember that one size doesn’t necessarily fit all. Or, one ‘sound’ doesn’t fit all.

Post Script – I want to thank Chris Hill for his guest post last time. Chris is an incredible resource and his blog, ‘Construction Law Musings’ is the best law blog I have read.

Also, if you want to see a very short clip, less than a minute, of Sonny:

http://www.youtube.com/watch?v=22tMBjerRdk

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Bobby Darnell is the founder and Principal of Construction Market Consultants, Inc. An Atlanta based management consulting group specializing in business development, sales, marketing and profitability as well as executive placement for the Architectural, Engineering and Construction industry.

Bobby can be reached at bobbydarnell [at] cmconl.com

www.cmconl.com

Today, I am taking a big ‘risk’ and letting Christopher Hill pinch hit as a guest blogger here on ‘Building New Business’. When I say taking a ‘risk’, I mean get ready for a real writer and excellent blogger!

I have gotten to know Chris in the past year and a half through his wonderful blog ‘Construction Law Musings’, via email and Twitter and his blog is the reason I did not want to enter any ‘Best Blog’ contest. I am a big fan of his and have learned a great deal from him and I am confident you will as well.

So, without further ado…Ladies and Gentlemen, Mr. Christopher Hill.

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As I left a mediation last week at 8:30 at night, I realized something that I knew all along. Mediation works.

Why does mediation work? For several reasons that I can think of.

The first, and likely most important is that lawyers are expensive. In most construction cases, we charge by the hour and those hours build up, especially close to a trial date. A mediated settlement can avoid this sharp uptick in attorney fees that always occurs in the last month before trial. Therefore the earlier the better.

The second is the flexibility to make a business decision. Commercial contractors and subcontractors are in a business, and they should be making business decisions. While one such decision can be to go to litigation; litigation is not always the best solution from a financial, or stress perspective. Construction professionals, with the assistance of construction attorneys, can come up with a creative way to deal with a problem and solve it.

While sometimes trial is inevitable (yes, even with a mediation), mediation allows for more options. At trial, someone wins and someone loses. A judge must pick sides and leave someone (and possibly both sides) unhappy. Then there are appeals, collections, and other expensive issues to deal with. Mediation allows compromise and allows the parties to agree to terms that the Court (or arbitration for that matter) could not give them. Add to this the opportunity costs of protracted litigation and the idea seems to be a no brainer.

The third is that a contractor can leave a mediation satisfied that they took part in the process and in controlling their own fate. Let’s face it, litigation is a foriegn world for most construction professionals. Once that call is made to their lawyer, the process can seem to be out of their hands, and in many ways it is. A good mediator can change that. While the compromise may not result in complete satisfaction, trial can, and often does result in dissatisfaction. At least with mediation, one can feel as if he was in some control and not on a headlong charge to oblivion without a way to put on the breaks.

Don’t get me wrong, mediation must be approached with a spirit of compromise and sometimes starting litigation is the only way to get there. If the parties aren’t committed to the process, no settlement can occur. Mediation does not work all the time, particularly if the parties present hurdles to the process.

In short, while litigation has its place and I am a construction attorney with the experience to pursue a case from start to finish, I would much rather help the contractors and subcontractors I represent continue to make money and avoid the stress, expense and monetary cost of litigation through contract review and mediation where possible. This is for one simple reason, mediation works.

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Christopher Hill is a LEED AP and construction attorney in Richmond, VA. Chris is a member of Virginia’s Legal Elite in Construction Law and authors the Construction Law Musings blog. Please feel free to contact Chris through his blog or on Twitter at @constructionlaw.

Please check out Chris’s Construction Law Musings Blog for more on Virginia construction law and other topics.

Through the years, I have been a member or an associate member of many trade organizations and have to admit, I have thoroughly enjoyed my time in each and everyone. Color me a ‘geek’ but I love networking, learning new aspects of our industry and attending tradeshows. My involvement in these organizations has afforded me many opportunities to indulge in all three.

A few years back, I received a call from one of my mentors, an incredibly successful real estate developer and owner of a large REIT. (Real Estate Investment Trust) Charles asked me if I would not mind meeting a friend of his just to talk and hash out ideas. Charles explained to me how he met James at Harvard’s MBA program and they, both being successful serial entrepreneurs, have stayed in touch through the years.

I met James for breakfast to discuss a company he is involved with and how they could build new business within the A/E/C marketplace. During our conversation, James introduced me to an Enterprise Forum that he chaired and invited me to attend one of their local meetings. I jumped at the chance and it proved to be, without a doubt, one of the most influential gatherings I have ever attended.

The night I arrived, I felt very much like a student attending fraternity rush on my own. The room was filled with some amazing people but the moment I walked in, one of the greeters introduced himself and asked me what I did. When I replied with, “I am Bobby Darnell and I have a small consultancy group that does business development, sales and marketing consulting for the A/E/C marketing place.” he grabbed me by the arm and said, “You need to meet Mike.” and proceeded to lead me across the vast room and introduced me to Mike.

After chatting with Mike for a few minutes, I learned that he just recently sold his construction company and was looking for something new to get involved with. (I later learned that he sold his construction company for $160 million dollars) We chatted, exchanged numbers, had a few meetings and that was really about all that happened.

The real impact of my time with this organization came when I attended one of their functions that pretty much resembles the NBC show ‘Shark Tank’ with the exception that the panel was offering a critique of the presenter’s business plan as opposed to capital. It was a most fascinating event.

I watched people present their business plan ranging from a one-man shop offering the latest and greatest metal drive (golf club) to a former television executive laying out his company’s plan to take on CNN. The insight the panel offered was amazing and worthy of a blog posting all its own.

However, the main nugget I walked away with was when one of the panelists, after hearing the pitch from the entrepreneur walked over to the whiteboard and wrote. ‘C.F.I.M.I.T.Y.M.’ and asked if anyone presenting knew what that stood for. No one did and I admit, being a ‘fan’ of acronyms, I did not either.

To sum it all up…’C.F.I.M.I.T.Y.M.’ simply means: ‘Cash Flow Is More Important Than Your Mother.’
Now, apart from any personal moral disagreements with that phrase, one would have a difficult time challenging the wisdom behind it from a business perspective.

We picked up a new client this week and are in the process of working with this owner as he begins to develop a transition plan to new ownership. On our laundry list of items to discuss and understand is the company’s cash flow since this company maintains and sells inventory in the A/E/C marketplace.

Selling, marketing, advertising, responding to RPF’s, building new business, etc. is all fun, necessary and vital to any business. But in chasing these important pursuits, we must not ignore the fundamentals of any business and that is staying on top of cash flow, revenues and expenses.

There is nothing I enjoy more than walking into a room, knowing I will soon be giving a presentation for either my company or on behalf of a company we represent with the goal of walking out with a commitment for new business.

Sales!

Revenue!

Closing Deals!

I love them all!

However, every business owner needs to always remember that the most important rule in business is that it’s not how much you make…it’s how much you keep.

Also, never forget…business is a verb!

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Bobby Darnell is the founder and Principal of Construction Market Consultants, Inc. An Atlanta based management consulting group specializing in business development, sales, marketing and profitability as well as executive placement for the Architectural, Engineering and Construction industry.

Bobby can be reached at bobbydarnell [at] cmconl.com

http://www.cmconl.com

Being a product of the south, I have heard and used more than my share of colloquialisms. I especially enjoy being able to sneak one in during a major presentation or group of ‘heavy hitters’ to see what, if any, reaction I get.

This past week, I was in the corporate office of a Fortune 200 company and was able to use one of my favorites, ‘Shuckin’ it down to the cob!’. For those unfamiliar with the phrase, ‘shuckin’ it down to the cob’ refers to shucking an ear of corn with so much enthusiasm that you are left with nothing but the cob. Translation: it means no frills, no extras, as bare bones of a proposition as one can find.

In this particular setting, we were negotiating a rather large contract for over 200 locations and the setting felt much like the stereotypical ‘buying a new car’ scenario with the price haggling bouncing back and forth like a Forrest Gump ping pong match.

It was close to ‘walking out’ time when I was able to remind the prospect that, regarding our price, we have ‘Shucked it down to the cob’. I was able to gain a double sense of satisfaction by (A) getting the business and (B) being able to use one of my favorite colloquialisms in such a setting.

This post is not so much about winning negotiations with corny, no pun intended, sayings but rather taking a look at one’s business, tossing out the fluff and focusing on that which is most important.

Here are a few ‘Shuckisms’ since my last post.

I had a meeting with a new client this week, and as we were reviewing the business development strategy we were putting together, the owner of the company expressed his excitement about all the new techniques we had gone over.

Shuckism: I had to remind him that results are the only thing that counts.

I was watching one of my new favorite shows, ‘Shark Tank’ and there was a candidate there seeking money for her store that catered to teaching children how to shop. If you are unfamiliar with the show, it is kind of like an ‘American Idol’ for entrepreneurs, seeking funding as opposed to a recording contract. After making a pitch for their business and stating an amount they are seeking oin exchange for ‘X’ percentage equity in their business, the ‘Sharks (Successful Venture Capitalists) either opt out or strike a deal.

It was obvious the lady had passion for her business but there really was not much of a model for success. All of the sharks opted out and while most were trying to be kind, one shark was brutally honest. He said, ‘Shut it down, I am the only one here who is your friend.”

Shuckism: There is a big difference between being in business and ‘playing business’.

A few years ago, we redid our kitchen. You know, the whole nine yards: granite counter tops, new appliances, cabinets, lights, hardwoods, etc. My wife did the budgeting as this was her project. I did give her a template to follow and she did indeed do a great job of researching all the costs.

When we reviewed the budget, I noticed she left blank the line marked ‘Contingency’. When I inquired, she assured me she thought of every cost and provided me her research to back up her claim. She was correct, her numbers for the labor costs and appliances and fixtures were spot on. I honestly could not think of any contingency so we left that blank.

Low and behold, when one is having a kitchen redone, the opportunity to cook in said kitchen is greatly reduced and the cost of eating out for three weeks could fall into your ‘contingency’ cost line.

Shuckism: If you are not sure, ask someone who has done it before. Measure twice/cut once applies to more than lumber.

There are so many great resources on the web…tons of great blogs, websites, discussion groups, e-newsletters, etc. If you are having challenges building new business…just ask.

I have had the pleasure of getting to know Michael Stone author of the construction blog ‘Markup and Profit’ (www.markupandprofit.com). He is very much like me in that he truly enjoys helping people build new business. The same with Mark Buckshon, author of the new book, ‘Construction Marketing Ideas’ (www.constructionmarketingideas.com). I would not be blogging if it were not for Mark. I know for a fact, both welcome inquiries and offer a lot of great information on their sites.

There are a lot of great resources out there that can help you build new business, you just have to take advantage of them. It may be the simplest small pearl of wisdom someone else shares with you that helps you land the next contract. Very much like trying to solve magic tricks, people often way over think the solution.

Shuckism: The answer is always ‘no’ until you ask.

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Bobby Darnell is the founder and Principal of Construction Market Consultants, Inc. An Atlanta based management consulting group specializing in business development, sales, marketing and profitability as well as executive placement for the Architectural, Engineering and Construction industry.

www.cmconl.com

Bobby can be reached at bobbydarnell [at] cmconl.com

Shorter Lines

WARNING: This blog does not have any pictures and may be considered lengthy by some.

I remember doing some channel surfing many moons ago and coming across George Carlin doing a bit about how all we really need in life is a ‘place for our stuff’. He went on to say that all life is about is finding a place for your stuff. Your house is really nothing but a place for your stuff with a roof. When you go on vacation, you take a smaller version of your stuff but you will still have a place for your stuff.

In the same spirit and thinking of Mr. Carlin’s wonderful piece on having a place for one’s stuff, I will contend that the parallel for business is not so much having a place for our stuff but, from Wal-mart all the way down to the sole proprietor, business is all about finding ‘shorter lines’.

Sure, we all have ‘stuff’ for our business. Where would I be without my laptop, my Blackberry, iPod player, copy machine, coffee maker, scanner and printers? These are merely tools to help me obtain what I truly desire – shorter lines.

Everything in business is a part of some type of line and we all want shorter ones. Think about it: You pull into the bank to make a deposit and there are four open drive-thru lanes. Which one do you pick? The one that has the shorter line. This also applies to checking out at the grocery store, going through security at the airport and any visit to your friendly Department of Motor Vehicles. We all want shorter lines.

In business, every single task we engage ourselves with involves a line of some kind with, I believe, the broader category being ‘time lines’. For each of the following, whatever process we choose, we cannot escape getting from ‘A’ to ‘B’ via a line of time.

• Complete stranger to loyal client

• Zero revenue to our first $1,000,000

• Profit margin from breakeven to 15%

• One location to ten branch offices

• Three employees to 50 employees

I think you get the picture. Every business person worth their salt is quite aware of the different lines involved in achieving one’s goals but what separates those possessing shorter lines from the ones with longer lines, is the amount of preparation put into each goal.

How does one reduce the timeline from meeting a complete stranger to having that person as a loyal client from 10 months down to three?

How does one shorten that timeline to seven figures in revenue from three years to one?

The simple answer is planning.

This past week, I am happy to report that we moved four companies from our ‘Prospects’ folder to our ‘Client’ folder…each being an entity in the A/E/C marketplace. If I had to highlight one item as the most profound and common issue of every single company we have worked with it would undoubtedly be how amazed I am to find the number of companies who make their living designing or following a set of plans and specifications…yet do not plan for their business.

What would the timeline be to build a 10,000 SF retail store without plans and specs versus the timeline with plans and specs?

What would the timeline be to build a million dollar business without a plan versus having one?

The late great coach Paul “Bear” Bryant once said, “Have a plan. Follow the plan, and you’ll be surprised how successful you can be. Most people don’t have a plan. That’s why it’s is easy to beat most folks.”

The shortest distance between two points will always be a straight line. The best way to make that line shorter is to plan for a shorter line.

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Bobby Darnell is the founder and Principal of Construction Market Consultants, Inc. An Atlanta based management consulting group specializing in business development, sales, marketing and profitability as well as executive placement for the Architectural, Engineering and Construction industry.

http://www.cmconl.com/

Bobby can be reached at bobbydarnell [at] cmconl.com