• About Us • Case Studies • Testimonials • Professional Network • News • Employment •

 

Home
Back
-  Staff
-  Case Studies
-  Testimonials
-  MASI Network
-  News
-  Employment

 

 

 

 

 

 

The Drywall Subcontractor

In 1998 MASI was referred to a drywall subcontractor in northeastern Massachusetts by an existing Master Builder client. MASI used a consultative sales approach to determine the prospect’s need for Master Builder applications.

After two meetings it was clear that Master Builder matched the prospect’s many requirements. The company was a union contractor with 110 employees performing union and prevailing wage work. Commercial project size was between $150k and $1.5mil. The company’s annual sales were approximately $10million.

The Problem:
With the exception of writing checks using Quickbooks Pro, all other functions where being performed manually. This included estimating, all payroll functions, union reporting, certified payroll functions, progress billing, time and material billing, prime and subcontract management (they used MS Word for this), request for change orders and approved change orders.

The company was very firm in their desire to computerize functions using one system that integrated all functions – accounting, job costing, project management and estimating. Prior to our meeting with the company, they had hired a national consulting firm at an initial cost of 50 thousand dollars to perform that task.

By the second meeting it was clear that, based upon our knowledge of the construction industry and specifically the union drywall subcontract vertical industry, we had changed our role from consultative seller of Master Builder to business consultants.

During our second meeting we were asked to review the agreement between the national consulting firm and the subcontractor. With a quick review of the contract and the work completed to date, it was clear that the consulting firm would NOT be able to deliver the desired contractual results without developing a construction specific integrated software solution from scratch. It was also clear that the contract would exceed the original budget. The prospect had already spent $35 thousand and had only received a few processes and complex reports on MS Excel spreadsheets.

The Solution:
We found ourselves in an uncomfortable situation as a consultant without an agreement selling the Master Builder Software. We identified the difficulty with the client prospect and agreed to make a proposal for consulting services that included reviewing all aspects of the business and developing an action plan. Our proposal for services included a fixed budget for consulting, training and Master Builder Software.

This ultimately lead to the restructuring of the business and the sale and implementation of Master Builder Software.

Our initial consulting direction resulted in an overhaul of existing banking, bonding, consulting, receivable collections, tax preparation, general line insurance brokerage and training. Our consulting role grew as we added new areas of focus that included business planning, tax planning, insurance consulting, legal contract addendum preparation, limited employment practices law, estimating processes, computer software training, process management, and later, business transition services.

While this was a very complex project, we were able to successfully complete it because of the commitment by the client and his team together with a very talented group of professionals called the MASI Network. In all the consulting addressed, we were able to recommend a business, tax, or legal professional that had a background and specific knowledge in the construction industry and, in many cases, an understanding of the Master Builder Software.  

The Results:
The results which were achieved over the next year included the following:

  • Contract with national consulting firm cancelled.
     
  • Negotiated out of the original consulting contract without legal intervention;  Payments were refunded to the client.
     
  • Implemented full Master Builder Software suite.
     
  • Totally integrated client’s processes from estimating through final accounting for jobs.
     
  • Client realized tax savings using the integrated information and tax planning services from the recommended CPA.
     
  • By providing previously unavailable information to the state of Massachusetts, the client qualified for an insurance contractor discount program that resulted in additional savings of $200k over three years.
     
  • Implemented estimating database with detailed part pricing and assemblies.
     
  • The estimating win/loss ratios were improved from winning 8 in 80 jobs to winning 12 in 60 jobs.
     
  • Bidding data now available improved decision making on which General Contractors and/or awarding authorities to work with (this became painfully clear in the next phase of the consulting).
     
  • Materials purchasing from vendors improved through the use of estimating and purchase orders.
     
  • Created written business plan and action plans.
     
  • Clarified company direction, employee roles and professional advisor roles.
     
  • Used business plan to influence increased lines of credit and bonding limits.
     
  • Software training was provided to all users.
     
  • Professional staff is able to use and rely on needed information
     
  • Processes and manual operating procedures formally documented.
     
  • Responsibilities are clarified,, resulting in increased accountability of mangers and employees.
     
  • New General Lines Insurance Broker.
     
  • Insurance costs were reduced $300k in three years.
     
  • New bank and new line of credit.
     
  • Line of credit increased from $100k to $1mil.
     
  • New CPA/Accountant
     
  • Significant tax savings were realized retroactively and in future years.
     
  • New Bonding Broker and increased bonding lines.
     
  • Increased limits from 500k by 1m line to 2m by 5m program.
     
  • Increased limits on personnel responsibility to 250k.

      

  

To learn about what MASI can do for your contracting business or to review additional case studies, feel free to Contact Us.

 

  

 *In fairness to our clients who may not want to receive unsolicited phone calls,
all Case Studies listed do not include the company names.

Full company names will be furnished upon request.