Qualified Remodeler

NAHB Remodeler of the Month: A Higher Standard

While experiencing a remodeling boom, Neuhoff Custom Builders improves its business processes.

Ken Neuhoff, CGR
Neuhoff Custom Builders,
Raleigh, N.C., 
neuhoffcustombuilders.com

Title: President

Year founded: 2004

Number of employees: 4


QR: Who started your company?

KN: Myself.

QR: How did you choose this career?

KN: It was a second career for me after being in the food service industry for eight years. I have always been interested in building things, since the soap box derby in 1980 when my brother and I finished in first and second place. I decided to go to work as an apprentice under my father-in-law, who was a lifetime builder, and after working under him for five years, I started my own remodeling business.

QR: What is the best advice you’ve received in your career?

KN: Being bigger doesn’t mean that you make more money. “Revenue kills; profit thrills.”

QR: How has the remodeling profession changed since you’ve been involved?

KN: Customers are more educated about building and have better access to information than ever before. This can help the communication between the builder and homeowner, but it also requires that the builder be smarter than Google. The customers’ expectations are higher than ever, creating the need for constant communication throughout the project.

QR: Where and what are the greatest opportunities in the remodeling market?

KN: We have been in an extended period of economic growth and rising real estate values, which has created a building boom in the remodeling market. We have had more large-scale projects ($300,000-plus) in the last couple of years than ever [previously]. Customers are not afraid to invest large amounts of money in large additions and whole-house remodel projects right now.

QR: What have you done to grow your business during the current economy? 

KN: It has actually been pretty easy in this economy. I often say that if you aren’t busy now then you are really doing something wrong. I think the key to continued growth is to listen to your customer, do what you say you will do, and make sure that when you finish a job that you can count on getting a positive referral from that customer.

QR: Is your current focus on more growth or steady revenue at greater profitability?

KN: We experienced a 35 percent increase in revenue in 2017 at higher profit margins, so based on that trend we are happy to enjoy both. As we look to 2018, I would say that steady growth at higher margins would be our goal.

QR: Are you hiring this year, and how are you going about finding the right people? 

KN: Luckily, not needing to hire at this time, but when we do, we network with our suppliers, vendors and other resume listing services.

QR: What is your No. 1 source of leads right now, and why is it working?

KN: We get almost 100 percent of our leads from referral sources. We do very little advertising, and the customers that are not referrals usually come from Houzz, or they see our job sign on a current project.

QR: What is a change you’ve implemented to continue improving your company?

KN: We are utilizing CoConstruct, an organizational program that should help us to generate better financial reports, manage profitability, track progress, organize the selection process and much more. This will also allow the customer to track their project schedules, process change orders and manage warranty issues.

QR: Where do you go to look for solutions and ideas for your business?

KN: As a member of the NAHB 20 Club, I have a virtual board of directors and partners in the other club members that I can bounce ideas and discuss issues with. We meet twice a year and have a message board where we can communicate current issues and topics of interest.

QR: What does being part of NAHB Remodelers mean to you?

KN: It means being part of a professional organization that takes pride in providing customers with the absolute best service and quality products. It is about holding yourself to a higher standard than just your average “Chuck in a truck.”

QR: From your perspective, is there anything that may surprise some people about association membership benefits?

KN: The fact that other local members can actually be your allies when they are also your competition. There is a lot to learn from other builder members if you give it a chance.

QR: What is your favorite item in your office?

KN: My dog.

QR: What is the most unusual project your company has completed? 

KN: The project isn’t so unusual, but how we accessed it is a little. We finished a fourth-floor attic for a customer and had to erect a 40-foot-tall scaffold/ladder system to access the space. This kept us from going through the house for most of the project’s duration. The rental for the ladder was over $10,000.

QR: Are there any career accomplishments you’d like to mention?

KN: We survived the recession of 2008!

QR: What motivates you every day?

KN: Other than retirement? No, I really enjoy what I do. There are always new challenges and opportunities to learn. I often have customers tell me that they would never do what I do—suggesting it is too challenging. Sometimes I agree, but I can’t think of anything else I would rather do. There is an immense sense of accomplishment when you step back and look at the work you have done and the impact you have made on your customers’ lives. |QR

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