JRE IN THE NEWS

American Builders Quarterly

HELPING HOME OWNERS BECOME BEST ON THE BLOCK BRINGS BIG DIVIDENDS

When your company has several divisions that perform different tasks, how do you showcase all of them almost simultaneously? According to Shane Burnette, Vice President of Richmond-based James River Exteriors (www.jamesriverexteriors.com) the answer is simple: sponsor a contest that will significantly boost the value of a local home without costing the home owners a cent, involves 11 weeks of video clips on the most watched local TV channel, educates consumers, and spotlights the services you offer!

Burnette, who helps run James River with his brother Brian, says that partnering with NBC’s Channel 12 (www.nbc12.com) in Richmond on the “Best on the Block” series was one of the most effective marketing moves his company has made to date. It began when James River offered owners of homes badly in need of exterior renovation a chance to compete for the prize of a complete exterior cosmetic renovation provided completely free of charge.

After the initial round of judging, Burnette put the broadcast video clips of the top three contenders’ homes online for a public vote. The video segments leading up to the contest end allowed Burnette to educate viewers about the importance of hiring a reputable contractor, having realistic expectations, and keeping the lines of communication open before, during, and after the remodeling process. Later segments followed progress on the winning home and provided an excellent way for James River Exteriors to show its services in action.

Contest winners Bernard and Michele Brown, who had spent four years remodeling and restoring the interior of their two-story, circa 1920 Arts and Crafts residence, were ecstatic to learn their home had been chosen. Their glowing faces were the best endorsement a company could hope to receive.

FOR THE BEST RESULTS, HIRE THE INEXPERIENCED

Contest marketing isn’t the only reason James River has seen its bottom line move from $5 million in 2004 to $10 million in 2005 to $12 million in 2006. Burnette says that another good reason for success is that the company prefers to hire smart people with a good work ethic and little or no experience in the industry. “We’ve found that we get better results hiring people who have no background in construction because they haven’t picked up bad practices from working at other companies,” Burnette notes. “Instead of trying to work with people who believe they’re doing it right already, we simply show them how to do things correctly from the start. We’ve got guys here who have been high school math teachers, coaches—in fact, we hired several of our people right out of college.”

The company is also unique in that its subcontractors work for James River Exteriors alone—a pretty unusual occurrence in an industry known for workers who move between companies like gypsies. “We pay them as subcontractors because they want to manage their money on their own, but we have such long-term relationships with them that they might as well be employees,” Burnette says.

James River is not entirely free of challenges, however. Chief among these at present is putting every nut and bolt of its work methods into a manual that will allow new hires to follow established procedures when the company expands its operations statewide. Burnette observes that when his father Mike Chaney founded James River nearly 20 years ago, he didn’t envision a time when the company would have 55 full time employees and 80-100 people working for it everyday. “He liked what he did and was successful, but every¬thing he did was in his head and not on paper,” Burnette says. “And while the culture of our business is key, we’ve got to put certain processes in place that define that culture.”

Making these processes easy to understand is essential prior to expansion because James River factors labor, materials, profit, and overhead differently than most of its competitors. “Our takeoff format is different,” Burnette explains. “We do it so that anyone in the office can pick up someone else’s take¬off and know exactly where to start and how to move through the sequence.” Company staff members are presently assembling information that will be put into a workbook or manual format so that new hires can easily follow the company’s system to sequence information and spec costs. Burnette also wants to have a safety-training program firmly in place before the company opens offices in other parts of the state. “If we’re in Richmond and something happens in Charlottesville that needs immediate attention, we’ve got to have a system in place to handle it,” he says.

ANNUAL HOME "REPORT CARD" SERVICE LOOKS PROMISING

James River presently handles new residential construction, commercial construction, and home improvement done at a home owner’s request. Though percentages for these three in overall company income vary from year to year, Burnette has found that when the residential market is booming (2002–2004) 45%–55% of earnings comes from new residential work and 35%–40% from commercial.

Burnette says James River is experiencing an increased demand for work on condos driven by a demand for affordable housing and a surging Boomer market seeking residential downsizing. The company’s principal divisions are stucco and Dryvit, stonework, siding, hardscapes, and repairs.

The company is currently launching a new division called Home Life Maintenance to enable home owners too busy to stay on top of home repairs and maintenance to hire James River to examine their homes and provide a “report card” that details findings and recommendations without requiring that owners hire James River to make recommended repairs.

Many of the repairs James River makes are to $500,000–$800,000 homes owned by working couples who let maintenance slide until repairs become ridiculously costly. “This business is a moving target—we’re constantly evaluating where we are and where we want to be,” Burnette says. “We saw a market need for evaluating homes annually and we’re moving to fill it.”