On Deck

Atlanta Decking: Subcontractors or Employees?

When considering a decking contractor, would you rather work with a company that has its own employees or a company that hires out using subcontractors? What are the advantages and disadvantages of each?  When evaluating vendors, is this even a buying consideration?  My own take is that this it is important and one which will play out through the length of the project and relationship.

Fortunately, I’ve been on both sides of this debate (employees or subcontractors), so I’m pretty familiar with it.  From 1990-1994, I was a subcontractor to one of the largest decking companies around, Archadeck. I didn’t have worker’s compensation on myself.  I did, however, show worker’s comp to the company…but excluded myself for the policy. This is a legal and, unfortunately in my opinion, generally accepted position that most deck companies and subcontractors take today in the state of Georgia.  The advantage is with the company in that it negates the need to match Social Security and Medicare expenses.

In 1994, when I started Tailor Decks, I had to make a decision on which path the company would take.  I made a decision and have stuck with it since then.  The decision was to go with employees…and here’s why-

While most contractors go the subcontractor route, I don’t consider this to be the right thing to do.  My experience has shown me that most choose this route because it lowers the company’s fiscal responsibility to the government and their employees.  I don’t think that a responsible thing to do.  If someone were to get injured while working on a Tailor Deck project, it would ultimately be our responsibility to see that they were taking care of.  Further, it’s our responsibility to shield our customers from any risk due to one of our workers being injured.  Having subcontractors without Worker’s Comp puts customers at risk.

Secondly, I believe (and I’m confident that the IRS would agree) that it’s the company’s responsibility to pay Social Security and Medicare in spite of the subcontractor tax claim option.  I believe that most contractors are playing with fire here and that, at some point, they’re going to have address the withholding taxes they’ve been ignoring for some time.

But in addition to it being the honest route, we choose the employee status because I believe it simply produces the best work.  A subcontractor gets paid a lump sum for a project.  In my experience, the faster he gets done the more money he makes…so he will typically work fast and care little about little mistakes along the way.  Conversely, an employee gets paid hourly.  He will typically slow down and catch any errors that take place (it’s my responsibility to make sure he keeps an appropriate working pace so that it doesn’t take a long time).

As a buyer of services, if this is an important criteria for who you use, you might want to ask during the proposal stage whether they use employees or subs.  Most will want to tell you that they use employees.  But since there is a potential downside to you if they turn out to be subcontractors (and they get injured without having coverage), you can ask the employer to produce a copy of the W2 for the workers.  If they can’t, then they are probably hiding this from you…and it might be best to consider someone else.

Composite Decks versus Wood Decks

As a consumer, is it better to go with a composite material or wood when building a deck?  It’s a good question, and one that I must field almost every day. 

My experience with composites has been interesting.  About 10 - 15 years ago, composites were introduced into the decking industry and heralded as its next savior.  The promises included lasting virtually forever and being maintenance free.  I must admit that we got caught up in the hoopla a little… although because I’m so crazy about wood, we only built a few composite-based decks.  And looking back, I’m so glad that we didn’t get caught up in it more.

Unfortunately, as other deck contractors experienced, the composite decks that we built came with problems.  The material didn’t hold up to the weather and elements very well…but most importantly, it just didn’t look very good.  Unlike wood decks, which almost seem to mature like fine wine as time passes, composite decks started out looking “ok”, then got worse (I’m sure Mother Nature got a good laugh out of that).

We were lucky in that we never got caught up in any litigation as we continue to support any work we do, but other contractors and manufacturers weren’t so lucky.  A quick Google search of “litigation” and “composite deck” or “warranty” and whatever composite you’re considering should yield an eyeful about the pitfalls of going with a composite deck.  The promises over the years by the composite manufacturers (they’re now promising that they’ve fixed the problems that they claimed to have fixed several times earlier) are now sounding a little hollow to me.

If you’re completely sold on composites, then we’ll build one for you.  But don’t be surprised if problems start to crop up.  Because if they do, then the manufacturer will not pay for the labor to fix the problem…only the material.  Conversely, on the wood decking side, we’ve only had to replaced a few deck boards in about 15 years.  That’s not bad and is testament in my opinion about the value of good ole wood.

A New Perception of Marketing by a Seasoned Business Owner

If there’s one positive development of this economic downturn, it’s been my realization of the importance of marketing.  From April of 1994 until last year, I operated from the position of “if you build it right, they will come”.  To be honest, that mantra worked pretty well for about 14 years.  Tailor Decks did very well and we frankly worked from the many referrals we got from the clients we had.  We really focused almost exclusively on doing a good job as opposed to finding business.

But all that changed last year.  I’d had my mind on developing an organized marketing program for when business cycled, which happened from time to time.  But the general economic downturn last year hastened this process into first priority for us.  Fortunately I found a good Atlanta marketing consulting organization in Impact Marketing, headquartered in Alpharetta, led by Scott Campbell.  In addition to knowing how to market a business, Impact Marketing focuses on the home improvement sector…which made them an easy choice to partner with.

Scott could probably explain it better than I, but at the small business level, marketing is like working out with a personal trainer.  We don’t have a budget to hire a marketing department, so I need to spend time working on marketing activities during the day…and these activities have to do with proactive business development…such as networking, making calls, advertising, etc.  I’m quickly finding that companies that sit out and wait, particularly in this economy, are not going to survive (much less flourish).  My plan is to become proficient in this area of the business as I am at designing or managing the actual decking project.

Since I’ve been working with Impact Marketing, I’ve really learned things I didn’t know about my business.  More importantly, however, is that I believe we’re continuously building a more and more compelling reason for Atlanta area homeowners to give Tailor Decks a try.  Keep your eye out for us as we build our “marketing deck”.

Business Planning- A Real Eye-Opener

I’ve been preoccupied lately putting together a business plan for our new TailorWood product line.  I believe there’s a real need in the marketplace for a quality milled wood designed for decks and screen porches.  We’ve been a pretty small custom deck company in Atlanta (by design) from day one.  I believe this specialty wood offering will put the company in a position to grow.  I’m 46 years old now and have put my body through 22 years of hard physical (albeit very fulfilling) work.  So I’m a little ambivalent about “company growth” at this point.  I think my ideal situation would be to continue to stay pretty small and produce beautiful decks.

When I first started building decks, I never imagined putting together a line of products.  But I can’t ignore what I believe is a good development for everyone.  It’s been about 9 months now since I formally started working on this TailorWood Line.  While exciting, the process has been very time consuming.  The business plan I’m working on will enable us to finance the project.  I must say that putting together the business plan has been an eye-opening project that has allowed me to learn more about our operations than ever before.

Transitioning to the new TailorWood line has given me a clearer picture of the time and costs previously spent using other material.  This includes not on the material cost but the cost and time in picking it up.  I’m glad that we now have a more favorable cost structure (which our clients will also benefit from).

If you haven’t done a business plan recently, I highly suggest it, even if you’re not obtaining funding.  It’s an invaluable process that will provide a fresh perspective of your business…even one that has some age to it.  My next business plan will be on a piece of property I own in Indiana that one day I’d like to start a business on. So much to do!