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February 2010 June 08

A monthly publication of the Asheville Home Builders Association

FEBRUARY
Parade of Homes Preview Event

Innovative Technology a Hot Button for Buyers

Trying to keep up with all the innovation in the products and systems available for today’s new homes is a daunting task, like trying to drink from a fire hose. Try for one small sip and you can drown in the torrent of information. As a result, many builders merely shrug and keep constructing homes the same old way. Besides, consumers aren’t rushing to add these kinds of capabilities to their new home. The home is the last low-tech sanctuary from an increasingly technological world. Right? Wrong. An NAHB survey reveals 60 percent of buyers believe “houses should be built like new cars with computerized controls.” Nearly 64 percent said they would be interested in having “an integrated ‘smart house’ system.” Rather than just gee-whiz gadgetry, today’s consumers are willing to pay more for simplicity and convenience. To gain widespread use, however, a product or a system has to offer a solution to a problem. Some builders are embracing high-tech solutions with encouraging results. High-speed connected infrastructure, including a community intranet, has a strong appeal to today’s buyers.

Join us as we release important information about the 2010 Parade of Homes including the new Associate Member Discounts!

February 18 5:30 pm Crowne Plaza
See page 7 to sign up to offer an Associate Member Discount and page 15 for more details!

Buyers have been snapping up energy efficient “green” homes, equipped with low VOC paint, photovoltaic panels on the roof and a laundry list of other items. This adds anywhere from $2.25 to $4 a square foot more to the cost. But consumers are willing to pay for these amenities because they offer a clear benefit. It comes back to perceived value. Homeowners can now manage lighting, heating and air, the security system, music throughout the house, security cameras, the pool system, and the locking and unlocking of exterior doors and windows, even through the internet. While you’re at work or out of town you cannot only keep tabs on your children and pets, one can unlock doors and disable the alarm for the cleaning staff or deliveries — and observe them the entire time. Moreover, the controls are often easy to learn, less complicated than a TV remote. Once upon a time networking appliances was too costly since wiring had to be run to each individual gadget, nor did it work well. Not anymore. Now, electrical outlets can be turned into a networking opportunity. Other features can include: An automatic water shutoff system to forestall leaks from plumbing or appliances. Invisible speakers in the dining room not only sounded great, they blended into the drywall so completely they were undetectable (www.stealthacoustics.com). A refrigerator-oven combo in the kitchen allows busy commuting families to keep a dish refrigerated until they’re ready to start the oven with their cell phone or laptop. There is a one-piece toilet with a lid that opens when anyone approaches; it closes the lid and flushes automatically. It has no refill noise; it also offers bidet style front- and back-aerated warm-water spray. While these gadgets may attract the interest of buyers visiting a home show, many builders targeting the first-time or move-up market remain unconvinced of their value, arguing that these products ultimately compete against upgrades in more traditional categories, like flooring, cabinets, and appliances. However, more progressive builders see high-tech amenities as a way to differentiate their products. Make sure you articulate the benefits of the products clearly and concisely. Give them just enough information to grasp its advantages. It’s easy for them to become overwhelmed. If they want to drill down into it more, that’s when you offer them product literature. The author, Charles Bevier, is editor of a trade magazine that profiles innovative construction technologies. This article was reprinted with permission from NAHB, Sales and Marketing. For more information, visit www.nahb.org.

Upcoming Events
March 16
New Member Orientation AHBA Office
3:30 pm - 4:30 pm

March 18
General Membership Meeting
Hilton, Biltmore Park Town Square 5:30 pm - 7:30 pm Check your weekly briefing for more details!

Asheville HBA

Bringing Professionalism to Our Industry

www.AshevilleHBA.com

2010 AHBA Board of Directors
Richard Soderquist, President Soderquist Construction Company Thomas McClain, Immediate Past President Home Sweet Home James Bound, 2nd Vice President Greencraft, Inc. Jill Jones, Treasurer Westall Chandley Josh Abrams, moreSPACEplace Skip Brewer, Walnut Cove Builders Bob Duffy, Biltmore Farms Homes Don Thompson, Thompson & Rhodes Builders Christopher Fox, Christopher Fox Builders Chris Lyman, McGuire, Wood & Bissette Construction Law Team Steve Royster, Bass & Royster Builders Renee Maxwell, Progress Energy Steve Wallin, The Western Carolina Home Place Robi Eckley, Ferguson Enterprises Jennifer Duvall, Asheville Savings Bank

Meetings
Professional Women in Building Tuesday, February 2 @ 8:30 am
*AHBA Office

Calendar
Board of Directors Meeting February 11 @ 3:00 pm Parade of Homes Committee February 25 @ 3:00

Tuesday, March 2 @ 12:00 pm
*Location TBD

Events
Parade of Homes Preview Event February 18 *Crowne Plaza New Member Orientation Tuesday, January 26 3:30 pm - 4:30 pm *AHBA Office General Membership Meeting Thursday, March 19 5:30- 6:30 pm, networking 6:30- 7:30 pm, meeting Hilton, Biltmore Park Town Square New Member Orientation March 16 3:30 pm - 4:30 pm *AHBA Office

Education

FEBRUARY
AHBI Education Program: Check back soon for the release of the 2010 NCBI and NAHB course offerings that the AHBA will offer this year through the Asheville Home Builders Institute! In the meantime, be sure to visit our website education page at www.ashevillehba.com to see the latest course offerings and any educational opportunities offered to you by our members.

Q & A: WNC Green Building Council
What is Xeriscaping?

AHBA Staff
Executive Officer Caroline Purcell Sutton [email protected] Director of Marketing & Communications KC Hart [email protected] Administrative Assistant Christi Stokes offi[email protected]

Xeriscaping (“zeri-scaping”) is a method of gardening and landscaping that focuses on using less water, if any. The name comes from the Greek word xeros (meaning dry”) and “landscaping.” Xeriscaping can use 50% or less water than traditional landscaping and is easy to maintain (less watering and mowing, etc). Xeriscaping is about water management through soil content, plant choice, irrigation, and mulch Many people associate Xeriscaping with cacti and other desert plants, when really many types of plants (usually drought-tolerant or water-conserving) can be used as long as they can establish a deep root system and are grouped with plants that have similar water needs. Learn more about which plants are drought tolerant in WNC: http://www.bae.ncsu.edu/programs/extension/publicat/wqwm/ag508_3/ OR http://www.ncsu.edu/wrri/uwc/xeriscape.pdf This information was provided by the Western North Carolina Green Building Council. For more information about the WNCGBC or their Energy Star or HealthyBuilt Homes Programs, contact the AHBA at 299-7001 or by email at [email protected]

Office Hours
Monday - Friday, 9:00am - 5:00pm Phone: 828-299-7001 Fax: 828-299-7008 Email: [email protected]

www.AshevilleHBA.com
2 | Asheville HBA Bringing Professionalism to our Industry

Utilize Your Resources Through the AHBA!

[ monthly message ]

Utilize your resources! The AHBA is your ultimate resource for building relationships that will help grow and strengthen your business. The AHBA realizes the importance of relaying information to our members, providing a voice and promoting our membership. During 2010 we have an array of opportunities for members to get involved and benefit. We are excited to announce that during 2010 we will offer General Membership Meetings, Builder After Hours and other special meetings and events. In an effort to keep you aware of what is going on in our community and what is targeting your businesses, we will host our General Membership Meetings on the occasional third Thursday of the month. These GMM’s will feature a 1 hour networking time followed by a short business portion. The business portion of our meetings will create an opportunity for sharing membership updates, Build-Pac and legislative updates and much more. Through the Home & Garden Expo, we are proud to present the only area industry specific homebuilding tradeshow featuring over 130 area companies at the WNC Ag Center on May 1 & 2, 2010. Be aware of deadlines so that you don’t miss this opportunity to reach consumers from Buncombe, Haywood, Henderson and Transylvania counties. We are committed to producing a quality consumer show with high traffic and quality products and services. This show will provide you the opportunity to display and promote your products and services to a targeted market of homeowners, potential buyers and clients within the western North Carolina community. Exhibitors will be part of the Official Builder Preview Night, held on Friday, April 30, 2010 from 5:30pm until 7:30pm. The Preview Event is open to members of the Asheville Home Builders Association, surrounding HBA’s, and area builders to preview the show, network and visit the exhibitors and their booths. We are pleased to announce the 2010 Home & Garden Expo will host the 2nd Annual Parade of Playhomes to benefit United Way of Asheville & Buncombe County. Builders and Associates will showcase their craftsmanship through playhome displays open for viewing during the entire show, ending with a live auction of the playhomes on Sunday, May 2, 2010. Make this the year that you and your company get involved in the AHBA. Utilize the best resource you have within the industry – your membership. Choose to take advantage not only of the meetings and events but the awesome savings you can receive through the Member Advantage Program, the competitive edge you can gain through professional development and the voice you have within your industry!

www.AshevilleHBA.com |3

[ builders tips ]

Builders’ Tip: Caulking an Undermount Sink in Place
I needed to affix a stainless-steel undermount sink to a granite countertop that was already installed on its cabinet bases. One problem I faced in tackling the job was how to get a good silicone-caulk seal between the underside of the counter and the rim of the sink. Rather than rely on a bunch of braces and shims to wedge the sink in place, I used rope and a couple of wood blocks. Here’s what I did: As shown in the accompanying drawing, I placed a wood cross brace over each bowl of the sink. Then I threaded a length of small-diameter rope around each brace and through the drain holes. On the underside of the sink, the rope runs through a wood block under each drain tailpiece. After running a bead of silicone around the rim of the sink, I rotated each block, shortening the ropes and drawing the sink upward with even pressure exerted around the entire rim. The resulting joint is so strong it almost makes the mechanical fasteners redundant. — Andrew Sheppard, Madison, Conn. Tips & Techniques provided by Fine Homebuilding. ©2009 The Taunton Press

4 | Asheville HBA

Bringing Professionalism to our Industry

NAHB Member Advantage Updates
Wyndham Hotels
As a member of the National Association of Home Builders you will receive an additional 10% off the “Best Available Rate” at participating locations every time you travel. Give agent your special NAHB discount ID number 20090 at time of booking to receive discount. Whether you are looking for an upscale hotel, an all-inclusive resort or something more cost-effective, we have the right hotel for you… and at the right price. So start saving now. Call our special member benefits hotline 1-877-670-7088 to reserve your room today at one of these fine hotels: Wyndham Hotels and Resorts® Days Inn® Ramada Worldwide® Super 8® Wingate By Wyndham® Baymont Inns and Suites® Howard Johnson® Travelodge® Knights Inn® AmeriHost Inn® Hawthorn Suites® Microtel Inns and Suites® “Best Available Rate” is defined as the best, non-qualified, publicly available rate on the Internet for the hotel, date and accommodations requested. Certain restrictions apply. To redeem this offer, call 1-877670-7088 or visit the links above and give ID 20090 at the time of reservation. Offer not valid if hotel is called directly, caller must use toll free numbers listed above. Advanced reservations are required. Offer is subject to availability at participating locations and some blackout dates may apply. Offer cannot be combined with any other discounts, offers, or special promotions. Discounts vary by location and time of year. Offer is void where prohibited by law and has no cash value.

Debilitating Provision in Health Care Bill

[ builder issues ]

As Congress moves to craft a final health care bill in the coming weeks, NAHB is leading the fight with other like-minded business groups to strip a jobs-killing provision in Senate legislation H.R. 3590 that would derail the fragile housing and economic recovery by placing a major financial burden on builders. The measure was approved by the Senate on Christmas eve by a 60 to 39 vote. Language offered by Sen. Jeff Merkley (D-Ore.) and slipped into the Senate health care legislation at the last minute unfairly targets small construction firms with more than five workers by requiring them to provide health care coverage or face stiff fines. Meanwhile, small businesses in all other industries would be exempt from providing mandatory health coverage if they employ 50 workers or less. NAHB has been alerting lawmakers that this requirement is patently unfair and dangerous for an economy that is only beginning to recover from financial collapse. It would place a huge competitive disadvantage on the housing industry, which under normal conditions accounts for more than 17% of the nation’s gross domestic product but today continues to struggle for survival. Immediately after the Senate approved H.R. 3590, NAHB sent a letter to every senator expressing disappointment that the narrow employee mandate provision targeting the construction industry had been included in the health care legislation. The letter urged all senators to work with House and Senate conferees to strike this provision from the final measure. House health care bill H.R. 3962, which passed the chamber by a slim margin of 220 to 215 on Nov. 7, contains no provision comparable to the Merkley amendment. NAHB lobbyists and grassroots members have been working diligently since Christmas to reach out to more than a dozen Democrats in the Senate and more than 50 Democratic centrists in the House to explain how this provision threatens the viability of countless small home builders across the nation and to call on their support to strip this requirement from the final bill. NAHB has received positive feedback from Democrats in both chambers who oppose the Merkley amendment and Sen. Blanche Lincoln (D-Ark.) is leading the charge to gather support for a “dear colleague” letter to send to Senate Majority Leader Harry Reid (D-Nev.), urging his assistance to strike the provision from a final bill. NAHB is also working with House Democrats to pursue a companion letter to House Speaker Nancy Pelosi (D-Calif.). At this time, it is expected that the usual House-Senate conference process to reconcile the two bills will be bypassed in an effort to avert any procedural stalling tactics from the GOP, which remains united in its opposition to both health care bills. As the process moves forward, NAHB will continue to push for the elimination of the Merkley language and seek other changes to address the concerns of the housing community and small businesses. This article was reprinted with permission from NAHB, www.nahb. org. For more information or similar articles on the ramifications of the Health Care Bill, please contact the AHBA at 299-7001 or the NAHB at 1-800-368-5242.

Hewlett Packard
Discounts: 9% notebooks, 5% printers/scanners, 7% handhelds, 12% workstations (faster processing power – ideal for graphics, blueprints), 16% servers, 12% storage, 6% third party options (over 10,000 items), plus free ground shipping. To place your order call 1-888-202-4488 and mention pass code “NAHB.”

Office Depot
10% off all delivery orders. Free shipping on orders of $50 or more. Call 800.274.2753 and be sure to mention your NAHB membership. Visit www.nahb.org/MA for more information on any of these discounts.

Remember! You can pay your membership dues with a Visa or MasterCard! Call the AHBA Office or pay online at www.ashevillehba.com! 828-299-7001

www.AshevilleHBA.com |5

Share your accomplishments, awards, and announcements with fellow members. Send your news to [email protected] and we will be glad to include it in the newsletter!

Asheville Radio Group Offers Non-Profit Rates
Asheville Radio Group (65.5, 98.1, 105.9, ESPN Radio) is offering a special to the AHBA! Any of our members who sign up for advertising with ARG will receive the non-profit rate for advertising when they add “Proud Member of the Asheville Home Builders Association. Visit ashevillehba.com for details” to the end of their advertisement. That is a 33% savings off the regular price! Also, for each company that signs up, the AHBA will receive 5 free commercials! What a kick-back for the AHBA! If you are interested in this great way to gain exposure for your company, please contact the AHBA Office at 299-7001 or contact Murphy Funkhouser at ARG at [email protected] Thank you ARG for promoting our motto of “Doing Business with Members!”

AHBA Member Becomes Green Plumber
Daniel Warne, with Cyclone Plumbing, Inc., has become an accredited and licensed Green Plumber, through the GreenPlumbersUSA training program. The program consists of five separate required courses, which Dan completed this past fall. We encourage you to visit www.greenplumbersusa.com to see what it is all about and how with the green trend in our area, it can be a win win for all. Also, for those builders who occasionally build a house across the border, Cyclone Plumbing, Inc. has obtained licenses in South Carolina and Tennessee also.

New Habitat for Humanity Chair Named
Ken Klein, president of KLEINCO Properties, a mid-sized real estate development firm in Tulsa, Okla., has been elected to serve as chair of Habitat for Humanity International’s 25-member board of directors. Klein has participated in building Habitat homes in Florida, Texas, Mississippi, Colorado, California, Washington, D.C., the Philippines, Guatemala and Macedonia. He has volunteered for Jimmy and Rosalynn Carter Work Projects in the U.S. Gulf Coast and the Mekong River delta. Klein has been involved in building and development for more than 35 years. His company has received national awards for quality and customer service, and he has been recognized at the local, state and national levels for achievement in building and remodeling. He was recognized as Oklahoma’s small business person of the year. Klein is former chairman of the Home Builders Institute’s Board of Trustees and he has served as a national vice president for NAHB. Klein is a trustee for the National Housing Endowment and a board member for MOVE Inc. Since it was founded in 1976, Habitat has built, rehabilitated, repaired or improved more than 350,000 houses worldwide, providing affordable housing for more than 1.75 million people.

HomeTrust Bank Announces New Hire
HomeTrust Bank announced that Donna Reeves has recently joined the company as a Mortgage Loan Officer. Reeves is responsible for originating mortgage loans, home equity lines of credit, and refinance loans. She joins the company with over 21 years of lending experience, most recently with Regions Bank. Reeves is a Certified Mortgage Planner, and has been actively involved with the Asheville Home Builder’s Association for 13 years. Reeves attended AB-Tech and is a also a member of the Asheville Board of Realtors, and the Mortgage Bankers Association.

6 | Asheville HBA

Bringing Professionalism to our Industry

[ member news ]

www.AshevilleHBA.com |7

[ member news ]

Your Balance Sheet Can Point You in the Right Direction
A balance sheet is an important tool that can help determine your company’s health, no matter its size. Balance sheets are just as important to small and medium home builders as they are to large public builders. But while the bigger builders evaluate every business decision they make based on how it will impact their balance sheet, smaller private builders often ignore or overlook their balance sheets. For private builders, that can be a costly mistake. Many decisions that can affect a builder’s future — even his survival — are based on information contained in a builder’s balance sheet. While you probably have no intention of selling stock in your company, a balance sheet can point out your company’s financial strengths and weaknesses. It indicates how you have invested your resources as well as your likelihood of attracting additional needed resources from lenders and third parties. Third parties use the information on your balance sheet to make decisions about your business that can impact your success. You must not only understand this important income statement, you need to evaluate your business decisions based on their potential impact on it as well. Use your balance sheet to evaluate your company’s growth potential using internal or third-party resources. Use your balance sheet to determine whether you can survive by comparing ratios from income on your statements with your balance sheet to determine how efficiently key areas of you company are operating. These key areas should include: Inventory turnover — cycle-time efficiencies Capital turnover — efficient use of your investment Working capital turnover — efficient use of liquid resources By relating sales revenue to accounts in your balance sheet, you can calculate turnovers. When calculating your business’ effectiveness, remember that you are compensated two ways — with your salary and your return on investment (ROI). Your balance sheet presents the value of the owner’s investment. Evaluate whether your business earns a higher return on capital investment than if you invested elsewhere, such as in a money market account, bonds or stocks. The relationship between net profits from your income statement and your investment will provide the return, as indicated by the following equation: Return on Investment = Net Profits Owner’s Equity Return and risk correlate closely — the higher the risk, the higher the expected return; and conversely, the lower the risk, the lower the expected return. The first step toward improving your ROI is to monitor the return. Establish a target return and focus on achieving it. Understanding how your income statement and balance sheet interact can guide you towards achieving your goal. Understanding Your Balance Sheet A balance sheet lists the assets or things of value that the company owns as well as who paid for those assets — the owner, third-party creditors or both. Assets are purchased with the owner’s “patient” capital or the creditors’ “impatient” capital. The owner’s investment is known as “patient” capital because owners usually intend to use the invested capital to grow their business or sustain operations. In contrast, creditors want to collect their invested capital, and in most instances, a return on their 8 | Asheville HBA Bringing Professionalism to our Industry investment, within a reasonable time. As an owner, you can grow you patient capital -also known as owner’s equity - by making additional investments in your company with cash, land or equipment. You can also invest in your company by keeping your net profits in it. This enables you to grow your company without having to borrow from lenders or creditors. You also can withdraw your earned capital from your company. You will be pressured by some to keep your profits in your company and by others to take your profits out.Typically, lenders and creditors will want you to keep your profits in your company in order to decrease their investment risk. However, since owner’s capital is always at risk when it is left in the company, as an owner, you may want to extract all your capital except what you need to maintain normal operations. This strategy may raise your lenders’ risk to a level higher than what their lending rules allow. Consequently, your lenders may require personal signatures to mitigate this risk and to guarantee your business loans. When determining your company’s profitability, profits are not compensation for work done. Working owners are entitled to compensation and these payments are not withdrawals from profit. The assets listed in the balance sheet include cash; accounts and notes receivable (the right to collect cash); investments; inventory including materials, land, homes under construction and finished homes; prepaid expenses (the right to receive a service in the future); office furniture and equipment; vehicles; and other miscellaneous items of value. Converting Assets to Cash There is a hierarchy for converting assets into cash during normal business operations. Office furniture, equipment, vehicles are not meant to be converted into cash; they are business operations. Inventories and the accounts and notes receivable are presumed to convert to cash in the near future. These are referred to as current assets. On the liability side of the balance sheet, or the impatient capital, there are two types of obligations — those due within the next 12 months and those that can be repaid over several years. The obligations that must be paid within the next 12 months are called current liabilities and, under normal operating conditions, you are expected to convert current assets into cash within the next 12 months and pay the current liabilities within the same time period. A comparison of current assets to current liabilities yields a ratio that indicates the likelihood that your company can repay its current liabilities. This current ratio is commonly regarded as a measurement of liquidity or solvency — your company’s ability to meet creditors’ demands, whether these are loan payments or other accounts payable. Current Ratio = Current Assets Current Liabilities Lenders are not interested in giving their money away without any hope of getting a return on their investment. Your company’s ability to pay back the money is an important consideration in making a loan or providing credit. Liquidity coupled with the risk factor, as measured by the relationship of debt to your capital or equity, will determine your company’s strength and its ability to borrow money. [ continued on page 11 ]

Lower “Fixed” Overhead Costs Using These Tips
“Fixed” overhead costs are often really anything but fixed and, in this economic downturn, business owners can find many ways to trim their overhead, if they trim wisely and don’t put their business at risk. Many of the cuts are relatively easy to do and relatively painless. But some may cut deeply and not all these measures will be applicable to your particular business. Be sure to consult with your attorney or accountant before adopting any of these suggestions and check all appropriate state and local regulations before proceeding. Health Insurance -Several Avenues Are Available You may be able to achieve substantial savings by reducing some of your insurance costs. Your agent, who should be part of your team and acting on your behalf, can help you find ways to safely cut premiums with your existing insurance companies, or shop for new companies , without putting your or your business at risk. For example, to reduce employer contributions, consider decreasing the co-insurance percentages and increasing deductibles and co-pays. Also look at increasing employee contributions or discontinuing the family coverage payment for your employees. While these adjustments will save you money, they will increase your employees’ costs. To reduce overall health care costs, shop health insurance providers to find the best package of services and costs. Explore implementing a health savings account or joining an association to get better group insurance rates. Life Insurance - Use Dividends to Reduce Premiums If possible, use dividends to reduce premiums or borrow from you policy to pay for the premium. You can pay the loan interest only or borrow the interest, too. Finally, you can cash in a whole life policy for its surrender value if you no longer need the policy. Disability Insurance - Extending the Waiting Period May Cut Costs You can use your disability insurance dividends to reduce premiums. Another way to cut costs is to extend the initial waiting period on existing policies from 30 days to 60, 90 or even 180 days. But let me caution you on two points before you consider this cost-cutting measure. If you extend the waiting period, be absolutely sure that you have enough personal savings to cover any injury that could occur before the policy takes effect. Also, consider that once you’ve extended your waiting period, you might not be able to qualify to have that waiting period shortened sometime in the future when business is on a more even keel. So before you go this route, be careful if your health is uncertain. Company Vehicle Insurance - Shop Around for Better Coverage There are several ways to save money on insurance for your company vehicles. You can save money by increasing your deductibles, as well as by dropping collision insurance on vehicles that are more than six years old or worth less than $4,000. You also can save money on premiums by not allowing employees with bad driving records to drive your vehicles. Finally, shop around for better coverage and pricing. If you haven’t explored it yet, oftentimes, the company that provides your business insurance can provide tie-in coverage for your vehicles at less cost than going to a separate company. You might also find it advantageous to join an association or group that offers pricing power or enhance coverage. Workers Compensation - Studious Trimming May Be Found The best way to reduce workers compensation premiums is to allocate the hours that your workers put on their time cards into the insurance

[ member news ]

company’s rate categories. Most states will allow you to do this, but to be certain, check with your agent or attorney before attempting this. For example, the rate category for a roofer will be higher than for a supervisor, so allocating by category should lower your overall rate. However, if you can justify the reallocation and breakdown, expect to be audited on actual payroll costs — because you will be audited. Be sure to get the classification codes from your insurance agent if you pursue this. Finally, don’t forget to obtain certificates of insurance from all your subcontractors that verify their workers compensation and liability coverage. This is critical, because many insurance companies now are auditing for their increased exposure when your coverage as the general contractor exceeds the coverage for the subcontractor. For instance, if you have $2 million in coverage and your sub only has $100,000, you could be audited and made to pay the difference in coverage costs. To avoid this, have your subs boost their coverage, or reduce yours. As for those contractors who claim they have no employees but seem to have “workers” on the job site — a sub of a sub — make them retain minimum coverage workers compensation policies. These policies are an inexpensive firewall in case one of those subcontractors is later deemed to be an employee, or the contracting company hires employees at a later date. Phone/Communication Expenses - Are All Lines Necessary? There are several ways to reduce communication expenses. It may be worthwhile to sign up for a cellular plan that has a higher base fee but provides tons of off-peak minutes and decent peak-hours minutes. You also can form a group of fellow plan users so you can pool and share minutes. Another way to trim costs would be to drop your answering service and replace it with an answering machine, or use the voicemail service that your phone service provides. If things get really tight, have your employees pay for their personal use of company phones. Also, consider dropping the land line altogether, dropping dedicated fax and Internet lines and subscribing to a communication package that combines voice and Internet or DSL. Utilities — Practice What You Preach We know how to help our customers cut utility costs by insulating their water heater, installing weather stripping, adding sweeps to the doors, improving overall insulation and even turning off that extra refrigerator, so we should do the same for our offices. Likewise, you can install lower wattage light bulbs or energy-efficient fluorescent lighting. You should also consider using timers, motion detectors or indicator lights in rooms that aren’t always occupied but where lights are often left on. Finally, to ride out what’s left of the winter, you may want to install a setback thermostat for the office and warehouse and wear sweaters and heavier clothing Promotions - Worth Trimming It is probably wise to cut back on your promotions and promotional material and to target your marketing. This might mean postponing your purchase of company shirts, coffee mugs, pens, calendars and holiday cards. You can also drop your sports sponsorship or ask parents and players to share the costs. Also, stop thinking that you have to buy coffee and donuts every time you come to a job. [ continued on page 14 ] www.AshevilleHBA.com |9

[ member news ]

A Local Perspective: The Perils of Mold
By Dan Throgmorton Time after time I hear customers and contractors venting their opinions on the processes and procedures required to properly remediate mold. One more commonly heard is, “What’s the big deal? Mold has been around since before Jesus was here” - I have to pause in agreement. Then, I usually tell them, “You’re right, but lawyers and sue happy opportunists weren’t as hungry when Jesus was here.” Perils of mold come in many different forms. Structural degeneration, loss of property values, physical and mental side effects, allergies, respiratory and other medical problems, to name a few. In addition, lawsuits are one of the very real perils of mold in today’s society. For a contractor or business person who serves the public, it can surely be a peril that comes about quickly and with very little warning, if the proper precautionary procedures are not taken as soon as mold is discovered to protect tenants, employees and the general public. There are many different opinions on what is the proper method for getting rid of mold. Some people use a solution of bleach and water to spray on the mold, trying to “kill” it or render it dormant. This futile attempt only discolors the mold for a period of time and gives it water to drink. The only way to render mold dormant is to deprive it of water or cellulose, its primary food source. Cellulose is the most common organic compound on earth. Cellulose is a main ingredient in paper, wood and cotton materials. However, it is not sufficient to just render mold dormant as dormant mold is generally much lighter, becomes airborne more easily, and can enter the body effortlessly as it is in the air that we all breathe. Whether dormant (dry) or in moist, healthy colonies, it still contains micotoxins in its genetic makeup that can still cause health problems. The IICRC (Institute of Inspection Cleaning and Restoration Certification) S-520, the mold remediator’s guidebook of standards, calls for mold spores to be removed. The mold should first be dried, then H.E.P.A. sanded and vacuumed, then treated with a disinfectant antimicrobial. This must all be done under negative pressure to contain mold spores from cross-contaminating other areas of the structure. It is highly recommended to employ the services of an Industrial Hygienist to guide this process and provide a job-site specific protocol and post testing to verify that the job was done thoroughly. One of the most valuable benefits of using a hygienist is the clearance letter. The clearance letter is generated by the testing firm, not the remediation contractor. This letter provides you with a clean bill of health for your property, which is infinitely valuable where mold is concerned. Dan Throgmorton is employed as Emergeny Services Manager at First Restoration Services, an AHBA member company. For more information about First Restoration Services, please visit their website at www.firstrestorationwnc.com.

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Bringing Professionalism to our Industry

[ member news ]

In the Know...

2010 Committees and Councils
Legislative Committee The AHBA legislative committee will begin actively meeting for the 2010 year in February. This year will present the opportunity to support new housing friendly candidates who will be running for city and county offices. So more than ever, Build-Pac will be a top priority for our association. Our goal for 2010 is simply to raise $10 per member in support of Build-Pac. The AHBA will be working very hard this year to get this important info out to you as timely as possible but we need your support through Build-Pac and through serving on the committee. Be a part of the solution! Membership Committee This committee is focusing efforts on retention and putting new plans into place to make your membership work better for you! Be expecting a phone call from a Board of Directors member and/or a Membership Committee member as they will be calling individual members with a brief survey about your current membership. Also, look for one of these folks at the next General Membership Meeting as they will be available to answer questions and introduce new members to our veteran members. If you are interested in joining this committee or have ideas that can benefit this dedicated team, please contact the AHBA Office. Parade of Homes Committee Steve Royster & Jason Weil- Co-Chairs The Parade of Homes Committee had the first meeting for 2010 and everyone is very excited to create another successful Parade of Homes. This month we will be presenting the Parade of Homes Preview event which will allow builders to preview vendor’s services and products with an opportunity to get discounts when applied towards homes entered in the Parade. If you are interested in signing up for an Associate Member Discount, please contact the office asap or find the form online at www. ashevillehba.com! It’s still early in the year and we are still welcoming new members to the Parade of Homes Committee. If you are interested in sharing your ideas and energy to help out, please contact the office! Professional Women in Building Council Gina Kidder – Secretary/Treasurer The PWB is very excited about 2010! This year we plan on holding two educational events along with several community outreach missions and other fundraising projects. We are excited to announce that this is the first year that the PWB scholarship will be awarded. The scholarship will be awarded to students attending a college, technical school or a senior in high school with in Buncombe County and studying in a construction related field. Visit www.ashevillehba.com/directory.php for examples of construction related job categories and contact the AHBA office for further details. We are also pleased to announce that PWB has a Fan Page on Facebook, log on and follow us! If you or someone you know is curious about our active group you are welcome to come to one of our meetings. As a reminder everyone is welcome to join and if you are interested in being a part of the PWB please contact Gina Kidder with Core Installations at [email protected] Next meeting date: March 2 – 12 noon @ location TBD April 6 – 8:30 am @ AHBA Office May 4 – 8:30 am @ AHBA Office

Balance Sheet Direction [ continued from page 8 ]
Debt to Equity = _ _Total Debt _ Owner’s Equity You can never afford to lose your company’s ability to borrow cash from third parties. Cash is king and as a company owner and manager, you must control the spigot providing the cash. Measuring Up to Your Competition “The Cost of Doing Business Study” enables home builders to compare profitability, cost of sales and expenses with like-sized builders from across the county. When evaluating your business, make sure you compare your company’s performance using the three ratios explained in this article and use the best-performing companies to establish company goals. Owners whose companies exhibit high performance ratios on their balance sheets will enjoy significant peace of mind, particularly during tough times, because their companies will be the survivors. Emma S. Shinn, MBA, CPA, is a business and accounting consultant with The Shinn Group based in Littleton, Colo. She also is a past chair and contributor to NAHB’s Business Management & Information Technology Committee. This article was reprinted with permission from NAHB. For similar articles about tax credits or NAHB Remodelers, please visit www.nahb.org.

www.AshevilleHBA.com |11

[ member news ]

- Renewing Members ACM Design PA Amy Conner-Murphy 4 Herman Ave Extension Ste A Asheville, NC 28803 (828) 684-9884 Artisan’s Group LLC Pasha Suprunchik 30 Ben Lippen School Rd Asheville, NC 28806 (828) 505-4691 Asheville Tile Inc. Sara Ring PO Box 17455 Asheville, NC 28816 (828) 253-1811 Benbow & Associates Sam Benbow 38 Glendale Ave Asheville, NC 28803-1442 (828) 281-2700 Better Homes by Gardon Inc. Glenn Gardon LEED-AP PO Box 68 Barnardsville, NC 28709-0068 (828) 712-1200 Beverly-Hanks & Associates Patti Haberstock 1940 Hendersonville Road Asheville, NC 28803 (828) 684-8999 Biltmore Farms Homes Bob Duffy 1 Town Square Blvd Ste 320 Asheville, NC 28803-5007 (828) 210-7506 Carolina Creative Builders Tim Penley 8 Roundabout Way Asheville, NC 28805-7801 (828) 298-5009 Champion Services Experts LLC Ritch Holt 578 Upward Rd Unit 7 Flat Rock, NC 28731-8592 (828) 698-5881 Carolina Creative Builders Tim Penley 8 Roundabout Way Asheville, NC 28805-7801 (828) 298-5009 Champion Services Experts LLC Ritch Holt 578 Upward Rd Unit 7 Flat Rock, NC 28731-8592 (828) 698-5881 GBS Lumber James Whiteside PO Box 2582 Hendersonville, NC 28793-2582 (828) 697-2471 Gemini Kitchens By Design Inc. dba Artisan Kitchen Studio James Worley 4 Olde Eastwood Village Blvd. Asheville, NC 28803 (828) 628-1475 High Mountain Solution LLC Charles McRae 28 Sun Valley Dr Alexander, NC 28701-9730 (828) 713-6617 K-Wall Poured Walls LLC Patty Kubica PO Box 487 Swannanoa, NC 28776 (828) 628-9255 K-Wall Poured Walls LLC Richard Kubica PO Box 487 Swannanoa, NC 28776 (828) 628-9255 K-Wall Poured Walls LLC Wade Mariagi PO Box 487 Swannanoa, NC 28776 (828) 628-9255 Landmark Builders of WNC LLC John Frock 525 Avery Creek Rd Arden, NC 28704-8769 (828) 650-0909 Lewis & Fish Construction Inc David Lewis PO Box 563 Mars Hill, NC 28754-0563 (828) 206-1260 Longmeadow Homes LLC Michael Tinsley 1550 Hendersonville Rd Ste 210 Asheville, NC 28803-3245 (828) 277-7737 McCarson’s Building Inc. Chris McCarson 5 McCarson Dr Leicester, NC 28748-6433 (828) 273-0077 McNutt Service Group Rick Cooper 110 Vista Blvd Arden, NC 28704-9457 (828) 209-4418 Mike’s Heating & Cooling Kim Messer 329 Dogwood Rd Candler, NC 28715-8413 (828) 665-4343 Mountain Steel Company LLC Phil Sorrells PO Box 9191 Asheville, NC 28815-0191 (828) 225-8601 Overhead Door of The High Country Jeff Benninghofen 229 Airport Rd PMB 133 Ste 7 Arden, NC 28704-6403 (828) 545-9765 ProBuild Scott Lewis 2324 Asheville Highway Hendersonville, NC 28791 (828) 694-0665 ProBuild Mike Dunlap 2324 Asheville Hwy Hendersonville, NC 28791-1504 (828) 694-0665 R-Pro Select Gregory Forrest PO Box 710 Fletcher, NC 28732-0368 (828) 651-9696 Richland Homes Thomas Linsley P O Box 307 Weaverville, NC 28787-8417 (704) 645-1040 Roger Ezell Plumbing Roger Ezell 79 S School Road Marshall, NC 28753-9704 (828) 649-2519 S B Coleman Stewart Coleman 1000 Centre Park Dr Asheville, NC 28805-1265 (828) 253-5391 Sears Commercial Service Brenda Dunlap 68 Fairway Drive Asheville, NC 28805 (828) 299-9688 Stickels Service Co. Inc. Bradley Stickles 32 Pine Hill Rd Fairview, NC 28730 (828) 628-4652 Timberline Custom Homes LLC Mark Montini PO Box 15111 Asheville, NC 28813 (828) 628-6800

12 | Asheville HBA

Bringing Professionalism to our Industry

- New Members *Pending New Member Orientation Appalachian Carpet & Textile Cleaning Rick Oweny PO Box 6897 Asheville, NC 28816 828-505-7733 Cleaning - Fire, Flood, Construction & Smoke Damage SPIKE: Greg Spicer *Pending New Member Orientation Asheville Ford, LLC. Bob Slebonick PO Box 1490 Asheville, NC 28802 828-253-2731 [email protected] Auto & Truck Dealership SPIKE: Richard Kubica *Pending New Member Orientation Best Built, Inc. James Alan Best 4879 Crabtree Mountain Road Clyde, NC 28721 (828) 506-9943 Builder SPIKE: Judy Dinelle *Pending New Member Orientation Dwell/EcoHouse Realty Inc. Jack Bebber 135 Cherry St. Asheville, NC 28801 (828) 254-3334 Real Estate Sales & Marketing SPIKE: James Bound *Pending New Member Orientation Gardens for Living John M. Phillips 21 Sweeten Creek Rd. Asheville, NC 28803 828-274-7225 Landscape Contracting Landscape Design SPIKE: Sean Sullivan *Pending New Member Orientation Gooseman Rose, P.A. Elizabeth C.M. Cramer 77 Central Avenue, Suite H Asheville, NC 28801 828-258-0150 Attorneys SPIKE: Bruce Alexander *Pending New Member Orientation Interiors By Donna Coudes Donna Coudes 2 Town Square Blvd Asheville, NC 28803 828-651-8811 Decorating & Interior Design SPIKE: Sean Cashin *Pending New Member Orientation KHI LLC Kerry M. Ball 701 Park South Blvd Arden, NC 28704 828-654-9916 Additions & Remodeling Carpenters SPIKE: Greg Wilkie

[ member news ]

*Pending New Member Orientation The Homepro Bob Wright 92 Winston Ave Asheville, NC 28803 828-230-8101 General Contractor SPIKE: Greg Spicer *Pending New Member Orientation Thompson - Rhodes Builders, Inc Bill Leidheiser 1472 Warrior Drive Tryon, NC 28782 828-712-5573 Builder SPIKE: Don Thompson

To educate and engage new members within the association, we have a New Member Orientation. AHBA Members are required to attend the one hour New Member Orientation as the final step in the application process.

- Pending Members ClearChannel Asheville Sherrye Coqqiola 13 Summerlin Drive Asheville, NC 28806 864-616-4325 Advertising & Specialties SPIKE: Richard Soderquist Hudgins Roofing Darin Hudgins 11 Morningstar Dr. Leicester, NC 28748 828-683-8417 Roofing Contractors SPIKE: Adam Payne Kenneth R Tuell Kenneth R. Tuell 59 Sherwood Rd. Asheville, NC 28803 828-505-2538 Residential Remodeling- Builder SPIKE: Patrick Hunt The Hands of Sean Perry Co. Sean Perry 250 Haywood Road Asheville, NC 28806 828-258-7272 Residential Remodeling- Builder SPIKE: Herb Freeman Brand Vaughan Lumber of Asheville Jason Hendrix PO Box 1379 Fletcher, NC 28732 828-776-1802 Building Materials: Wholesale SPIKE: Rob Fisher Brand Vaughan Lumber of Asheville Bill Bugbee PO Box 1379 Fletcher, NC 28732 828-776-1802 Building Materials: Wholesale SPIKE: Rob Fisher Ferguson Enterprise, Inc. Tim Shipman 1100 Ridgefield Blvd, Ste B Asheville, NC 28806 828-665-0800 Plumbing Fixtures & Supplies SPIKE: Robi Eckley Maggie Valley Club Fraser Sparkman 1819 Country Club Drive Maggie Valley, NC 28751 828-926-1616 Real Estate Sales & Marketing SPIKE: Steve Royster

PLEASE READ In compliance with our Bylaws and the policies which have been put in place by our Board of Directors and the Membership Committee, Association procedure is to have new member applications approved by the Board of Directors and by the General Membership. Please look at the lists of Members. If you know of any compelling reason that any applicant should not be considered for membership, please contact any AHBA staff member at 828-299-7001 or email your comments to the AHBA at [email protected] All information given to the AHBA is held strictly confidential.

www.AshevilleHBA.com |13

[ member news ]

- Sorry to See You Go d. wright construction, inc. Associate Dagwood Flooring Associate Dry Ridge Roofing Associate GB Fisher Enterprises Builder Impact Investments Associate Judd Builders, LLC Builder Sellstate Premier Realty, Inc. Associate Standing Stone Builders, Inc. Builder

The AHBA is sorry to see the companies below drop their AHBA memberships. If you know these past members, or do business with them, give them a call and help us get them back to the AHBA! All-Brite Flooring, Inc. Associate Asheville Basement Finishing Associate Biltmore For Your Home Associate Concrete Walls Unlimited, Inc. Associate

Prasino Construction Company, Inc. The Preserve Communities Builder Associate Rob Robinson Builder Builder Toby Davis Enterprises, Inc. Associate

Balance Sheet Direction [ continued from page 9 ]
Instead, only buy promotional items that convey a clear-cut business value. Use direct mail, newsletters to past customers and neighbor letters to target your marketing. Instead of a holiday card, send a holiday newsletter this year. It will get your name out in front of prospects while telling them so much more about your business. Finally, plan events and reward employees smartly and creatively to save money, without losing the good feelings that these events usually generate. Bank Charges -Cultivate a Relationship With Your Banker Shop around for the best combination of open hours, minimum balances, credit card rates, per-check charges, knowledge of the building business, products for consumer loans and home equity lending. Then, cultivate a relationship with your banker, before you need his services. Consider consolidating your personal banking with your business accounts to lower overall fees. Negotiate a better loan rate or ask for a loan to manage the downturn. Finally, protect your reputation by applying for overdraft protection, phone transfers and other time- and reputation-saving services. Office Supplies- Don’t Skimp When Dealing With the Public There are several easy ways to trim office supply costs, buy from wholesale clubs, buy in bulk, delay buying promotional items until better financial times, etc. However, don’t skimp on stationery or contract documents. Customers want to deal with professionals, even during a downturn — and lessthan-than professional stationery and documents will reflect badly on you. You can use your computer creatively to save costs while reinforcing your professionalism. For example, create branded templates for custom contracts, bills and other documents used by the public. Buy a good color printer for this and for printing newsletters, photos from digital cameras, change order documentation, brochures and other branded materials. One other computer trick you can implement to save money and precious staff time — find ways to automate backup files, software updates and other computer maintenance. Maintaining Your Vehicles - Ways to Save at the Pump Fill your tanks with the lowest allowable grade of gas. Also, maintain the proper tire pressure on all your vehicles. This will improve vehicle mileage and reduce tire wear and tear. Don’t get caught up with credit card promotions and drive all those extra miles just to buy gas at a specific card’s station. Finally, instead of buying new tires for your trucks, buy retreads if they’re available. Subscriptions and Memberships - Focus on Trade Associations First of all, eliminate as many of your duplicate paid subscriptions as you can and, instead, share and circulate the magazines and newsletters with your staff as much as possible. Also, cancel the subscriptions you don’t read regularly. Stay active in your trade associations, like NAHB and your local home builders association and remodelers council, but cut down on some expenses by trying to share staff, tools and non-competitive business information with fellow members. Also, participate in association networking so you can cultivate new business opportunities and further your professional development. Trade Shows and Conventions- Don’t Skimp Here In order to succeed today, you must be the most informed, bestequipped salesperson you can be to deal with prospective clients. You need to learn all you can about the latest installations and their limitations, the newest techniques and more. So, attend as many trade shows and conventions as you can, take in as many educational opportunities as possible and network with as many people as you can. Keep in mind that the best learning can come from peers sharing battleworn and tested techniques. Attending these tradeshows is a perfect time to talk with others in the industry and actually learn from their mistakes and triumphs. Having extensive product knowledge- and access to manufacturers and distributors- is a great advantage over your competition, and trade shows are a perfect place to see and try new products. Attend local seminars, too, because they are oriented toward your local market and they’re less expensive. To cut down on you show expenses, eat, sleep and travel as cheaply as possible. Share a room, don’t eat at expensive restaurants, use shuttles or share rides and economize wherever possible. Alan Hanbury is a past chairman of the NAHB Remodelers. This article was reprinted with permission from NAHB. For similar articles or questions regarding this article or its author, please visit www.nahb.org.

14 | Asheville HBA

Bringing Professionalism to our Industry

[ AHBA Nation ]

2nd Annual Parade of Homes Preview Just Ahead
On Thursday, February 18, the AHBA will host the 2nd Annual Parade of Homes Preview Event at the Crowne Plaza, where the AHBA will release details about the 2010 Parade of Homes. Deadlines, sponsorship information, and Associate Member Discounts will all be revealed at this special networking event. All members are invited to attend this event, and select members will have their products and services on display for the Parade Builders to see. Anyone interested in participating in this program and setting up a table at the event should contact the Association office ASAP. The 2009 Associate Member Discount Program was a huge success as over 45 member companies showcased their products and networked with builders who were using such products in their Parade homes. For a nominal charge of $75 Associate Member companies can participate in this program by offering products and services at a discounted rate to builders for their entries in the 2010 Parade of Homes. Discounts offered in the past include: free estimates, 10% off installation, 10-20% off packages, etc. The dead-line to submit an Associate Discount is February 16, 2010. Discounts received after this date will not be accepted or advertised by the AHBA. Associate Discounts will be released to the membership on February 18, 2010. During the signup period participating companies will be recognized in the Weekly Briefings beginning Monday, January 18, 2010. Participating in the Associate Member Discount Program is easy to do and gives you and your company great exposure to Builders interested in the Parade of Homes!

All members are encouraged to come to this exciting event that will kick-off the 2010 Parade year! And don’t forget, there will be awesome door prizes for the builders that participate in this event, just like last year! So be sure to attend this event and visit the booths to get amazing discounts on your 2010 Parade of Homes entry! Join us at the Crowne Plaza on February 18th to take full advantage of this exciting opportunity!

AHBA NATION

AHBA Member Spotlight
Name/Title: Jill Jones Company: Westall Chandley Building Supply AHBA Member for 4 years!

How did your company get started? The opening of Westall Chandley dates back 106 years, and has been under the direction of current owner Frank Taylor for the last 5 years. He purchased the company right after the floods of 2004 when it was in a distressed state. Our goal has been to turn the company around and weave Westall Chandley into the fabric of Asheville. I became involved with Westall Chandley shortly after Frank bought the company. What makes your company unique? We are the only locally owned and operated independent building supply company in the area. Quality is our most important offering- quality, customer service and product. What has been your greatest business success? My greatest business success has been to guide the company along with the W.C. management team through the most difficult economic downturn ever faced in our lives We are poised to come out of this better than ever! What do you like about doing business in Asheville? Asheville is large enough to maintain a healthy business but small enough to have a close relationship with your customers.

What kind of customer does your business attract? We have a diverse group of builders- old timers, newcomers, and those that fall somewhere in between. Every day and every customer are never the same! How does your business positively contribute to the Asheville Community? First, as we are a locally owned and operated business, all of our dollars say in Western N.C.. Second, community service is of utmost importance and a part of our culture at Westall Chandley. Our company is highly involved with Asheville Habitat for Humanity, United Way, and the AHBA. LOCATION: 2 Asheville Locations WEBSITE: www.westallchandley.com www.AshevilleHBA.com |15

Asheville Home Builders Association
PO Box 9722 Asheville, NC 28815

[ inside this issue ]
Calendar ........................ 2 Committee Update .......... 3 Builders Issues .............. 4-5 Member News ........... 6-14 AHBA Nation ................ 15 Blueprints is an award-winning publication!
2008 STARS Award (NCHBA) 2008 Association Excellence Award (NAHB)

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