CANADIAN CONTRACTOR JANUARY 2014

RenoSummit

Pickup Truck

Contractor

page 14

page 30

page 38

2013 Report

Reviews

CANADIAN

University

BUILD | GROW | PROFIT

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CONTENTS

CONTENTS

14

features

RenoSummit 2013 14 What contractors learned at Canadian Contractor’s recent business seminars

24

The Creative Eye 24 Design-build genius in North Toronto from BLT Construction

creative eye

Pickup Trucks Report 30 What’s rolling off the production lines at Chrysler, Ford, GM, Nissan and Toyota

Elaine Kilburn/KlixPix

pickup trucks

departments

Online 4 Victoria Downing on profitability.

Mike Draper on problem solving.

Tim Faller on eliminating the deficiency list.

30

report

Editorials 6 Rob says many contractors still appreciate Rob Ford.

Steve wonders why.

Site Notes 12 A drywall contractor sues Ontario’s WSIB for $6-million over a “negligent” audit Contractor U 38 How a contractor is about to double his revenues, while still having time to meet his kids off the schoolbus

38

contractor

U

Bureaucrat of the Month 42 A look at the nice gig held

by I. David Marshall, president of Ontario’s WSIB

www.canadiancontractor.ca

January 2014

3

ONLINE

CANADIAN

ONLINE @

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@

CONTRACTOR BUILD | GROW | PROFIT

.ca

Join the conversation 21,100 contractors are having online

VIDEO:

THE MENTAL GAME OF RENOVATING Interview with Victoria Downing Victoria Downing, president of Remodelers Advantage, the Maryland-based contractor training firm, was the keynote speaker at our recent RenoSummit 2013 seminars.

Interviewed here by Rob Koci, she explains that the first step to making the money you deserve as a renovator is to change your mindset.

Type “Victoria Downing” in the search bar at canadiancontractor.ca to find this video.

VIDEO:

GET RID OF THAT DEFICIENCY LIST! Interview with Tim Faller One of our presenters at our recent RenoSummit 2013 seminars, Tim Faller, president of Field Training Services at Remodelers Advantage, has a unique take on how to get rid of the dreaded deficiency list. While this may sound impossible, watch this video to learn how it can be done.

Type “Tim Faller” in the search bar at canadiancontractor.ca to find this video.

VIDEO:

PROBLEM-SOLVING WITH CUSTOMERS Interview with Mike Draper Mike Draper, our resident contractor coach from the Renovantage organization (renovantage.com) does a four-part video series on problem-solving with your client. Take 15 minutes to watch this series and be better equipped the next time stuff hits the fan on your jobsite.

CANADIAN

Type “Mike Draper” in the search bar at canadiancontractor.ca to find this video series.

CONTRACTOR.ca BUILD | GROW | PROFIT

Volume 15, Number 1 January 2014 canadiancontractor.ca | Tel: 416 442 5600 |

Editor: Steve Payne spayne@canadiancontractor.ca

80 Valleybrook Drive, North York, ON, M3B 2S9

Contributing Editors: Mike Draper, Kim Laudrum, Bill Roebuck

Canadian Contractor, established in 2000, is published 6 times a year by BIG Magazines LP, a division of Glacier BIG Holdings Company Ltd.

Art Director: Mary Peligra mpeligra@bizinfogroup.ca

ISSN 1498-8941 (Print) ISSN 1929-6495 (Online)

Publisher: Rob Koci rkoci@bizinfogroup.ca Production Manager: Gary White gwhite@bizinfogroup.ca

Business Information Group

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January 2014

Circulation Manager: Beata Olechnowicz bolechnowicz@bizinfogroup.ca www.canadiancontractor.ca

BIG Magazines LP Corinne Lynds, Editorial Director Tim Dimopoulos, Executive Publisher Alex Papanou, Vice-President of Canadian Publishing Bruce Creighton, President of Business Information Group Subscriber Services: To subscribe, renew your subscription or to change your address or information contact us at 416 442 5600 x3547 Subscription Rates: Canada $45.95 per year, Outside Canada $83.95US per year, Single Copy Canada $9.95.

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the following methods: Tel: 1-800-668-2374 Fax: 416-442-2191 Email: privacyofficer@ businessinformationgroup.ca Mail: Privacy Office, 80 Valleybrook Drive, North York, ON, M3B 2S9.

Contents of this publication are protected by copyright and must not be reprinted in whole or in part without permission of the publisher.

Publications Mail Agreement No. 40069240 We acknowledge the financial support of the Government of Canada through the Canada Periodical Fund of the Department of Canadian Heritage.

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EDITORIALS

Voices

WHY SO MANY OF US SUPPORT ROB FORD

By Rob Koci

T

” ” His popularity is no surprise to contractors.

Rob Koci Publisher

rkoci@canadiancontractor.ca

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January 2014

www.canadiancontractor.ca

hroughout November, Rob Ford’s indiscretions went around the globe, making him the laughing stock of the free world. Yet at the end of the month, Sun Media polls showed that his approval rating in Toronto remained respectable (42 per cent) and if an election were held today he’d win 33 per cent of the votes.

Polls like this make Ford-haters apoplectic and, more importantly, blind to the reasons why, I believe, the man will get re-elected next October. (Mark it on your calendar and congratulate me when it happens.) Ford’s popularity is no surprise to business owners who have to deal with government agencies who make them feel like disrespected outsiders – especially if you’re a contractor. There is no gravy train for us.

When I was a framer, Local 183 of the Brotherhood of Something or Other came to town and forced me to unionize. My piecework pay remained the same. In fact, everything remained the same except that every two weeks the union boss would come around to take his cut.

The union very quickly became another mouth to feed.

Even though I was a “member,” I was an outsider to Local 183, useful only for my ability to pay the salaries of its employees.

Government workers enjoy public service salaries and almost total job security from a deep well of funding provided by us, the outsiders. We see them when they come to our jobsites to check our paperwork and our green-tag boots and shut us down if we don’t comply.

Rob Ford’s fiscal fanaticism and crude behavior makes him the mortal enemy of the “in-crowd.” The city’s broken, hard-bitten, feral citizens recognize him as one of their own somehow snuck inside, now tearing up the privileged, hard-packed ground and mocking the entitled class with his vulgarity.

The insiders will kill Rob Ford eventually (hopefully, only politically) but while he is still breathing, you should support him because he is one of us. Hold your nose if you have to.

EDITORIALS

Voices

HAS MY PUBLISHER LOST HIS MIND?

By Steve Payne

A

cross the page, my publisher urges contractors to “support” Rob Ford “because he is one of us.”

Well, obviously Rob Koci is not referring to the Mayor of

Toronto’s crack-smoking, rotating drunken stupors, endless pathological lying, habitual infantile tantrums and apparently endless secret meetings and transactions with people being investigated for criminal offences. That stuff, Rob asks us to “hold our noses” over, while we mark an X next to Rob (or possibly Doug) Ford in the next election in this city.

So let’s look at the other claim across the page: that Rob Ford is the ultimate representative of hard-working, up-at-the-crackof-dawn, renovation contractors.

In my experience, the vast majority of our contractor readers are the anti-Rob Ford. Our mayor was born with a silver spoon in his mouth – his father’s label-printing business in Etobicoke made him a multi-millionaire at an early age. I don’t know too many of you that inherited your businesses. Renovation firms are notoriously difficult to pass on to the next generation.

And if one of you were to tragically destroy your company because of your personal drug use, alcoholism and lying, I highly doubt you’d have an outraged brother to bully his way in front of your disgusted clients to defend you, claiming conspiracy. I doubt you’d have 42 per cent of your clients giving you top marks on HomeStars and I doubt you’d have more than 33 per cent of your customers planning to hire you again.

”

When contractors act like this, they don’t earn 42% approval on HomeStars.

In this business, there’s nowhere to hide when you screw up.

In this business, the only thing that will keep you alive when you, as we all do, fall short, is to swallow your ego, face up to your angry clients, apologize, and fix it all on your own dime.

Rob Ford, at time of writing, is about to bill the taxpayer for his own legal defense.

”

Steve Payne Editor

spayne@canadiancontractor.ca

I don’t see anything that Canadian Contractor needs to stand up for in all this. www.canadiancontractor.ca

January 2014

7

VOICES

We hear you Fees for both the WSIB and The Ontario College of Trades, and homeowner payment disputes pushed contractors to let off steam to Canadian Contractor.

WSIB fees crackdown will spur cash business I was in the mining industry in the 80s and we had to pay 20 per cent [WSIB premiums] back then. I quickly went to cash and never looked back. I remember a worker who was closing a load binder on a load and it popped back and gave him a bloody mouth. I had great workers – he never filed a claim because I told him I didn’t have coverage…

Yes, those days are gone forever. Now, everyone’s a complainer: a little cut on the finger will cost you a lot of money. Good luck! I’m thinking of getting in the homeownercontractor cash business now, because this new law (Editor’s note: WSIB Bill 119 that now extends mandatory WSIB premiums across the industry, with limited exemptions) will drive prices up and make it more lucrative for cash deals.

You can’t stop us so don’t try. That’s a lesson I learned from the big banks – but the difference between me and the banks is that I don’t pay payola to the crooked politicians to look the other way. I fly under the radar, I’m off the grid!

Posted online by Anonymous on Nov. 27

“I will surrender my licence here in Ontario” Reader R. Blewett posted this comment online in response to another reader who said, about the Ontario College of Trades (and its mandatory fees, which have provoked almost exclusively anger from our readers in these pages) that he was “willing to give it a chance.”

“I have no intention of paying for the licence which I hold here in Ontario – this [College of Trades and its fees] is just another bureaucratic boondoggle. More parasites feeding at the trough in Toronto. How did the entourage who are ensconced on Bay Street, no less, get their appointments?

Apparently they were selected but no one knows what the parameters were – nepotism and sinecure most probably.

The disingenuous reasoning behind this whole farce is public safety and trades monitoring. What a joke when we already have a top heavy inspection department, who know when they inspect, who is good and who is not. The free market soon takes care of poor tradespeople who are

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January 2014

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engaged in running a contracting business.

I will surrender my licence here in Ontario, because as far as I am concerned this falls under “consent of the governed” and they did not obtain it. Just another piece of legislation and regulation rammed down the throats of non-consenting tradespeople, and enforced by the thugs in government: Brad Duguid and the rest of the world improvers in Toronto.”

Edited version of a post by R. Blewett on Nov. 21

“I have got bad news for my building trades union” I have been a foreman in my local for 25 years and in truth the majority of (the union) members I employ are competent and conscientious.

But not all of them.

You know who I am talking about.

For 25 years I have tolerated them because I learned very quickly that no matter how outrageously poor a member’s actions may have been, if I file a complaint with the local business manager the person defending himself will end up being me – not them. The end result is always the same, you pass the problem person onto the next contractor and find some petty measure of retaliation.

I guess you thought you were real clever when you put the political interests (of the building trades union) ahead of those of every working trades person in this province and lobbied the government into creating this abomination (Ontario College of Trades).

You might not be as smart as you thought.

You see, starting today every time one of your problem members sets new standards in buffoonery I won’t be talking to you, and you won’t be able to protect anyone. I will be filing a complaint with your wonderful new college.

So the next time one of your fine licensed electricians does not know the proper polarity on standard receptacles (I kid you not), I will take pictures and document everything, confident of the College’s imminent action as mandated for my compulsory trade. I am sure the fine, unbiased members you have planted in adjudicator positions will take firm

VOICES

action. One would shudder to think of the reaction should I have to pass details of this (to Canadian Contractor) to publish here.

You created this. Now you are going to deal with it.

Posted online by Joe Greps on Nov. 24

“How many take the money and run?”

John. B replies to the contractor who posted that the courts are next to useless in helping contractors to get paid by deadbeat clients.

“Are you guys kidding?

I’m a homeowner and business owner [who has] had extensive work completed by poor contractors – and [have had] the threat of a lien being placed on my residence.

I quickly realized how easy it is for contractors to place liens on property – and how expensive it can be for homeowners to get rid of a lien or a bad contractor.

As far as renewing a mortgage, any homeowner can

do so with a lien on their property, as long as they use the same mortgage company. It’s only when a homeowner wants to change mortgage companies or sell, that it becomes an issue.

Contractors know when they have messed up.

Homeowners are not always the bad guys. How many contractors take the money and run, leaving handicapped and old people stranded? It goes both ways.

If a contractor wants to place liens on properties, then that information should be made public and both parties should be allowed to show their sides.

Each party should post pictures and let the public decide who is being most unreasonable.

It would be much cheaper than having to hire lawyers to do up all the paperwork, even for small claims court!”

Edited version of a post by John B. on Nov. 14

Join us at a 2014 RONA Contractor Show event near you Rob Koci, publisher of Canadian Contractor, invites readers to join him at Canada's only coast-to-coast annual contractor show.

This year, you can drop by any of RONA's 2014 contractor events in 12 cities across the country. Talk one-on-one with more than 60 top vendors offering the latest technology and newest products in the home renovation industry. Build your know-how.

2 0 1 4 R O N A Co n t ra ct o r E v e n t s Ca l e n d ar Date

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ALBERTA Calgary

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SASKATCHEWAN Saskatoon

February 18

Prairieland Park – Hall B

MANITOBA Winnipeg

February 20

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NOVA SCOTIA Halifax

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For more information, and to register, visit www.rona.ca/show 10

January 2014

www.canadiancontractor.ca

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SITE NOTES

CO

Drywall contractor suing Ontario’s WSIB for $6-million

because, Keane’s lawsuit alleges, they interfered in the WSIB’s audit of Keane’s firm “without any legal standing in the audit procedure (and) communicated with the audit department for the sole purpose of initiating and/or influencing the outcome of the audit.”

It’s been three years since Keyon filed the lawsuit, and four years since WSIB finally admitted that, after multiple appeals processes, Keane’s workers (he averaged Sean Keane of Keyon Drywall claims WSIB’s audit between 30 and 50 men on the job at any of his company was “malicious and vexatious.” one time) were actually independent To view the video go to canadiancontractor.ca and operators – under their own rules and by type “WSIB lawsuit” in the search bar. To view the legal precedence. documents that Keane has filed with the court, Keane had claimed this all along, but visit his website: wsibdefence.ca. was stonewalled by the WSIB in a number of ways, he claims. His lawsuit details dozens of what the plaintiff claims were In 2007, following a WSIB audit, Keyon Drywall’s Sean “high-handed and callous” actions by the WSIB. It claims Keane was assessed $340,000 in back-premiums for the documents were actually altered by the WSIB; that Keane three previous fiscal years for what WSIB said were his was asked to provide information to support his claim that “employees.” The Durham, ON-based contractor then began he couldn’t possibly obtain from his workers; that there a two-year battle with the agency to prove that his men were was (at first, anyway) no “reasonable, clear or impartial independent operators – and so he shouldn’t be liable for the review” process that he could follow (the file just kept getting premiums. He eventually won but his company went under. bounced back to the field auditor who had been assigned to Now, Keane is suing WSIB for, among other allegations, him in the first place). “malicious and vexatious” audit practices that he says cost Above all, Keane claims that the WSIB had a deliberate him his company. policy of, knowingly, forcing contractors to pay WSIB premiums Keane is seeking $3-million from the WSIB for loss of that even it knew, under its own rules, disregarded law or business, loss of profit and legal and accounting fees. He’s precedent. And that it did this with the “clear and cogent seeking a further $3-million for punitive damages. intention… to render businesses that engaged independent Co-defendants in the suit are five of WSIB’s employees operators unable to continue in business.” and, perhaps surprisingly, Local 675 of the carpenters’ Canadian Contractor will be running a feature story on union (United Brotherhood of Carpenters and Joiners of WSIB audits in our next issue. Check our website for more America) that Keyon worked with. The union is named updates on this story.

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RENO SUMMIT REPORT

What renovators

By Kim Laudrum

learned at RenoSummit 2013

150 of you attended Canadian Contractor’s one day business seminars in Whitby, Toronto and London, ON. photos : larry arnal photography

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January 2014

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RENO SUMMIT REPORT

“You should have no more than 20 percent slippage.

More than that and you’ll see the money dribble through your fingers.”

– Victoria Downing

W

ant to run a more profitable renovation business, have time to enjoy life and build equity in an enterprise you can sell?

It can be done. But first you’ve got to understand why you’re really in business, says Victoria Downing, president of Maryland-based contractor training organization Remodelers Advantage. “Your business is a tool to help you get what you want out of life,” she said.

Downing was the keynote speaker at Canadian Contractor’s RenoSummit 2013 business seminars held in Whitby, Toronto and London, Ont. in early November.

Now, your business is not going to give you a better life if you’re still marking up your materials and costs as little as 10 per cent, Downing told the attendee contractors.

You need to aim for something closer to a 50 per cent mark-up or more on materials and labour, she advised.

Yes, some renovators in the crowd bristled at that.

“I’m competing with guys who are doing cash-only deals. They are just killing the market,” said Maurice VanEgmond of VanEgmond Carpentry in Brighton, Ont. A mark-up of 50 per cent on materials and direct job-cost labour “is going to price me out of the game,” he said.

www.canadiancontractor.ca

January 2014

15

Maybe not, Downing replied. Maybe his competitor is pricing himself out of the game.

Downing explained that, unless a renovator has a serious mark-up on costs, he isn’t even going to be able to cover all his overheads, including labour burden (all the deductions you have to pay beyond basic wages to your crew), insurance, vehicles, equipment, administrative and office expensives, and more.

Net profit doesn’t even begin to show up until all those overheads have been paid for.

Plus, you need think about putting something back into your business. “You need to make money to reinvest in your business, grow, get new software, build a six-month salary safety net for yourself, plus you need to do marketing and other things,” Downing said.

Would keeping overheads low help improve profitability?

Lorenzo Marchelletta of Super Seven Group in Toronto asked Downing.

“Overhead is not necessarily a bad thing. Your overhead should help you to increase profit,” Downing replied. “If you hire some support, it can help take some of the pressure off and you can make more money.”

“In my opinion, your budget is the absolute most critical tool to being successful,” she said.

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Gross margin “The big number for me is gross profit margin,” Downing said. That’s the revenue earned minus the cost of goods sold, divided by the revenue. In her example, the client paid $15,000 (a 50 per cent mark-up) for a job that cost the contractor $10,000, yielding a $5,000 gross profit. To find the gross profit margin (a percentage), divide the gross profit by the revenue. In this case that is $5,000 divided by $15,000 which equals 33 per cent. Yes, a 50 per cent markup gives you only a 33 per cent gross profit.

Downing suggests renovation contractors should aim for a gross profit margin in a range between 33 to 40 per cent “to run a decent company.” To get to that 40 per cent margin you need an almost 70 per cent markup.

“You can get a life but you can’t get a decent life if you can’t make enough to get the people you need to support what you need to do,” she said.

“There is no one right gross profit margin for every company,” Downing said. “You can keep your gross profit margin low, but you might have to increase your volume.”

Mike van den Bosch of Bosch Services Ltd. in Burlington shared that his company had tiny 10 per cent gross profit margins a little over a year ago. “This year, I haven’t priced any jobs lower than 35 per cent. And you know what?

6

Profit Tips from Victoria Downing

My sales went up! We did more sales by focusing on the business. I’ve had to hire more help.”

Downing commented: “I have seen this change so many people’s lives just by having the backbone to charge what you feel you’re worth.” And she has a no-nonsense term for what causes you to charge less than you’re worth: “Head trash.”

Head trash “The lesson that I learned is to not give in to the ‘head trash’ and reduce the price of the job,” offered Randy Burke from Evergreen Home and Cottage in Lindsay. And Len Williams of Rosemount Construction Inc., West Hill, ON (a member of Renovantage) shared another margin-raising success story.

In less than one year, he went from looking at a $10,000 tax bill that he couldn’t pay, to looking at a $100,000 tax bill that he happily paid.

Williams told us he used to work 80 hours plus a week, stressed over paying bills and missed seeing his family. Now he works fewer hours, has a decent living and says he has “a family life again.”

The key takeaway? You are much better than you think and you deserve to be successful. Or, as Victoria Downing pointed out, “Profit is not a four-letter word.”

1.

2.

3.

4.

5.

6.

T

ry to mark up the cost of materials and labour by 50 to 70 per cent. This will yield you a gross margin of 33 to 41 per cent.

Include your labour burden in your estimate. In addition to the hourly wage, the labour burden includes taxes, vacation pay, employment insurances, pensions, and benefits, for example. You might be paying your workers $30 per hour, but what is the real cost per labourer to you? It might be as much as 50 per cent more.

Look at your profit/loss statement once a month and compare it to your budget. Are you hitting your target?

Identify where you are making money and where you are losing it. Todd Juhnke of Sage, a contracting software company (and RenoSummit 2013 sponsor), says many renovators don’t even look at their financials until tax time. “It’s a missed opportunity,” he said.

The business owner’s salary should be about 10 per cent of revenue. And this should be paid on a fixed basis, just like any other salary.

Work with OPM (Other People’s Money). Always make sure that the client is up to date on payments so you aren’t using credit or your own money to pay for materials and labour.

Aim for a reasonable rate of business growth: in the 10 to 15 per cent range. At 5 per cent, you are just keeping up.

www.canadiancontractor.ca

January 2014

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Building trust with your crews Renovators who want to build their business with the intention of selling it in the future will need to trust others to be successful, said Tim Faller, a business coach for Remodelers Advantage who spoke at RenoSummit 2013.

“Every business has goals and the more you can involve your employees in your goals - and theirs - the more successful you’ll be,” Faller said.

Trust is an essential part of team building, Faller said, and one of the best ways you can get crews’ trust is to show them they are appreciated, according to studies on motivation. The second best way to motivate employees is to give them the feeling that they are in on things, Faller said.

“Many business owners feel the employees have nothing to do with the money. Wrong. They have everything to do with the money,” he said.

Faller offered the following tips for ensuring success: 1. Get the sale.

2. Get the sale at the right profit margin.

3. Have a hand-off meeting between the salesperson and the production staff. Get all the details down on paper from the salesperson’s head.

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4. Create information that works for the production team so that they can meet their target dates and the business can realize a profit.

5. Pre-plan all the details and hand-off to the production team at least two weeks before the start date.

6. Have the production manager take a critical look at the job requirements as planned by the sales team in conversation with the client. There might be some issues or questions that come up that should be addressed.

“It’s much better to have those conversations up front,” Faller suggests, than to lose time later on the job.

“Good planning will generally lead to greater customer satisfaction,” he says. “You want to WOW your customer.”

Make sure you follow up to see that the end result matches the plans.

7. After the job, conduct a debrief, Faller emphasized. It’s important to develop continuous improvement systems. Such systems become a part of the company’s equity – they are valuable should you ever wish to sell your company. The debrief should look at what went right and what went wrong on a project. Was the client happy? Did you meet budget?

Was the jobsite left tidy? “Find solutions and repeatable scenarios,” Faller advised.

Tips for Better Teams from Tim Faller

D

on’t just say, “I have an open door policy” – make communication happen. Only about one per cent of employees will come to you with a problem. You need to ask questions – and ditch the blame.

Ask, “What would it take for you to care about that?” to create accountability among your members.

Encourage production people to participate in scheduling and providing materials lists. Why? It holds them more accountable. It also walks them through the job and allows them to visualize it.

Provide detailed production plans. Once the start date arrives, all materials should be on site and the production team should be ready to go.

Conduct a debrief after the job is finished.

What did we do right? Are there any repeatable solutions for which we could develop a system?

www.canadiancontractor.ca

January 2014

19

Hard-hitting, low-cost marketing “A lot of renovators don’t focus on marketing until they have no business,” notes Victoria Downing. By then it could be too late.

And that’s a shame because good marketing will bring in the leads that will help you gain a better choice of client. “We want you to work with those clients who appreciate you,” Downing said.

But don’t expect things to happen right away. “It takes a good, solid six months of marketing before you start to see results,” she added.

Start with your annual revenue goal and work your way backwards to determine how many leads you need to generate, Downing said. Let’s say it’s $120,000. Ask “What’s my average job size? Is it $10,000? How many $10,000 projects will I need to reach the revenue target?” Let’s say you need one per month or a total of 12 for the year to reach $120,000.

Then determine your closing ratio. That is, of the appointments you go on to quote a job, how many do you sell? Maybe it’s one in ten. If so, you’ll need 120 appointments or 10 per month to make your annual revenues.

You also want to be sure you have qualified leads.

Qualified leads, as opposed to just leads, are the types of clients that you really want to work for. You need to define your geographic area, the range of household income you are looking for, and the type of work you are best at.

Downing suggests businesses should expect to spend

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about 60 per cent of their marketing dollars on previous clients and their circle of influence. Why? Because previous clients provide referrals – the best kind of marketing there is. Your circle of influence includes your suppliers, sub-trades, guys you play hockey with – anyone you know socially and in your community.

“I am starting to see business really rocking on social media these days,” Downing said. Homeowners are researching online (HomeStars, etc.) before they ever contact a renovator. Consider connecting with previous clients on Linked-In and Facebook. Get a website and start to capture potential client’s e-mail addresses. If people are visiting your site, they are probably already considering a renovation. Offer them something they can download for free in exchange for their e-mail address: a guide on the top five things to avoid when renovating, for example.

Then e-mail them monthly, “softly, subtly,” in a way that lets them know about your latest services, Downing advises.

To stay in front of his customers, Reno Summit 2013 attendee Lou Orazem (Inspire Homes) outsources an electronic newsletter, produced once a month for a little over $300. In it he provides tips and information useful to homeowners. He sends it out to his database of existing and potential clients. Orazem's contact list includes previous clients, leads generated at trade and other shows in his community, architects, designers, painters, and property managers, among others.

By the numbers:

$60 BILLION

size of the Canadian renovation market

$10 MILLION

$11 BILLION

“No renovators in the GTA have annual revenues of more than $10 million per year.”

size of the renovation market in the GTA Source: Greg Peterson, Renovantage

6,000

registered general contractors in the GTA

Y

Accurate Cost-Estimating

ou need to find out the maximum value to the customer and least cost to you when figuring out the selling price of a project, former renovator Rob Koci (and publisher of Canadian Contractor) told RenoSummit 2013 contractors.

Part art (trust your intuition) and part science (so many dollars per linear foot of materials needed), “estimating is nothing more than an act of prophecy,” Koci said.

Of course, to become a successful prophet it helps to have a system in place that can accurately give you an idea of the true costs before starting the project, Koci said. But this number can be skewed by any number of factors.

For example, how much control do you have over the numbers? Are you hiring subtrades? Did a designer or architect bring you onto the project? If so, you won’t have as much control over your cost estimating as you might like, Koci warned.

But assuming you do have some control over the costs of a project, it’s an excellent idea to create a feedback loop to capture those numbers. It can help you to develop and fine-tune a systems approach for your business. Such a system not only

can become a valuable tool for cost estimating, it can also become tangible equity in your business, Koci said.

Upon completion of a project, do a postmortem with your employees, sub-trades and suppliers. Determine where your costs escalated or where you saved money. If you were to estimate this type of work again, is there something consistent you could use as a rule of thumb? Ask yourself, Koci said, “Does it look a lot like the last one we did?” Plug that information into your system. It could be a simple Excel spreadsheet or a sophisticated program like the one from Sage, he noted. Or it could be in your head, but it’s better to get it down on paper. This will help you with costing the next project. “Experience counts for a lot,” Koci said.

Estimating software programs can be very useful. They are scaleable, accurate, quick, connected to accounting and project management systems. They will allow you to play with the figures. (“Do ‘what ifs’,” as Koci termed it.) ‘[They] can help you determine the risk factor of using the cheapest sub, or the most expensive one.”

4 Estimating Tips – next page.

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4

Estimating Tips from Rob Koci

1

Share your estimate with a successful contractor friend. Ask if it seems about right.

2

Think like Wal-Mart. Look at the money you’ve given your sub-trades. Ask them to help you reduce your costs.

3

Your estimate should make your prospect a little uncomfortable. If there’s total comfort from the customer, it’s probably too low.

4

Don’t allow yourself to get locked into thinking of value as “costs plus mark-up”. What you do is more valuable than that to your customer.

Closing the deal tips from Mike Draper One way to generate more revenue for your company without spending more marketing dollars - is to convert more leads into customers.

This was a key part of Mike Draper’s (Renovantage. com) presentation: “The Five Ways Formula to Massively Grow Your Business.” Draper started by reminding the audience of the Renovantage definition of a successful business: “A commercial, profitable enterprise that works without you.”

Getting more customers is obviously key to the first part of that definition and Draper asked contractors to consider a change in approach to make it happen.

“Rather than increase the number of leads you get,” he said, “consider improving the conversion of leads into customers.”

“Leads are actually the hardest thing to increase,” he

We would just like to say THANK YOU to our sponsors.

2013

RenoSummit Mastering Your Renovation Business

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Jan/Feb 2014

RENOSSUMMIT THANK YOU AD!.indd 1

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explained. “You could increase the margin, or up-sell the client. But the number one thing you can do for the most impact is to improve the conversion rate of leads to clients.”

How can a contractor seal the deal more effectively?

Draper warns contractors to avoid proposal killers that turn clients off. Proposals that require large sums of upfront money, that demonstrate a lack of understanding of what the client is looking for, or that fail to provide an item by item quote will see the client lose interest.

“Never e-mail a quotation,” Draper advised. Always visit with the client to go over the details so that you can make adjustments to include or exclude changes the customer wants to see.

Why should you take that extra step? Face to face is still important, Draper said. Follow up is essential to getting the sale. The number one reason why clients change their purchasing point is not because of the price, but because

they perceive the contractor is indifferent, Draper said.

Consider the number of touch points with a client that it takes to make a sale. A whopping 81 per cent of customers will not close the sale until on or after the fifth call, Draper pointed out. Yet, almost half (48 per cent) of the businesses competing for the client will give up after just one call. And 84 per cent have given up by the third call.

You can win that business without spending any more money, and increase your profitability, if you just hang in there. cc

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13-11-29 9:17 AM

CREATIVE EYE

NORTH TORONTO REBUILD IN STEEL AND WOOD 20 x 66 ft. detached residence, BLT Construction Services Inc. This rebuild of a midtown detached residence in North Toronto (it’s also our cover shot) was meticulously executed by BLT Construction Services Inc., a firm which has done extensive work on many interior fit-outs, including the Trump International Hotel and the Air Canada Centre (renovating the Leafs’ dressing room twice).

The final effect shows how “simplicity is the ultimate sophistication” (Leonardo da Vinci – and borrowed

by Apple Computer). To fully open up this structure required ample structural steel married to traditional wood framing.

The asymmetrical floor plan affords maximum floor space. Look at that elegant cantilevered roof (far right) providing shade for the rooftop patio. www.bltconstruction.com

Elaine Kilburn/KlixPix

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CREATIVE EYE

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CREATIVE EYE

NORTH TORONTO REBUILD IN STEEL AND WOOD 20 x 66 ft. detached residence, BLT Construction Services Inc. “When you’re building contemporary with halfinch reveals to keep things looking ‘crisp’, your structure and your finishing has to be superprecise,” says BLT’s director of construction, Robert Downey. “On traditional construction, moldings allow you a slight margin for error. Not so here.”

The client homeowner was also the architect – and some of his finishings are, you’ll agree, beyond exquisite. We’ve never seen a range hood that futuristically elegant, nor glass tile used to such perfect effect. www.bltconstruction.com

Elaine Kilburn/KlixPix

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CREATIVE EYE

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CREATIVE EYE

NORTH TORONTO RENOVATION WITH ‘GENTLEMAN’S DEN,’ AND WINE CELLAR BLT Construction Services Inc. Just look at this exquisite work, including a gentleman’s den and theatre with acoustical sound separation. In our middle (inset) photograph, you’ll see a glazed wine cellar complete with its own chilling condenser.

Just look at that floor: it is a radiant-heated hickoryfinished engineered hardwood. The marriage of the amber-toned millwork with the manmade cultured stone and the sumptuous coffered ceiling upstairs, make this a design-build project for any renovator to dream about. www.bltconstruction.com

Elaine Kilburn/KlixPix

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CREATIVE EYE

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TRUCK REPORT

Pickup makers target

‘best-in-class’ What’s new for 2014 and 2015 from Chrysler, Ford, General Motors, Nissan and Toyota

[

By Bill Roebuck

Truck manufacturers are upping their games.

[

Chrysler Ram

The new pickups are stronger, smarter and more stylish than ever before – and they can save you serious bucks at the gas (or diesel) pumps.

Let’s take a test drive of the 2014 and 2015 offerings from North America’s Big Three auto manufacturers as well as Japan’s Toyota and Nissan.

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TRUCK REPORT

Chrysler Ram T

he latest version of Chrysler Canada’s Ram Truck, the light-duty 2014 Ram 1500 model, can now claim ‘best-inclass’ leadership in several categories, including standard V6 horsepower and 4x2/4x4 fuel economy. It’s also the only one to offer a V6 diesel engine, and the horsepower rating of its standard V8 easily bests the competitors.

The new Ram is also the only pickup to offer an eightspeed automatic transmission, a coil spring rear suspension and optional four-corner air suspension.

When Ram engineers looked at their competitors, they decided to go big when it comes to towing capacity. The new Ram’s standard 3.6-litre V6 will haul 3,379 kg (7,450 lb.), the 3.0-litre EcoDiesel V6 is rated at 4,173 kg (9,200 lb.), and its standard V8 pulls 4,740 kg (10,450 lb.).

The only way to tow more in a half-ton is to turn to the Chevy/ GMC twins, whose optional big V8 can tow 5,443 kg (12,000 lb.).

Need to have a trailer towing capacity of 13,608 kg (30,000 lb.)? Then you can turn to the Ram 3500 Heavy Duty,

powered by an upgraded 6.7-litre Cummins Turbo Diesel that produces 850 lb.-ft. of torque. It can haul 500 sheets of drywall.

The heavy-duty 2014 Ram 2500 and 3500 pickups get new frames, a new powertrain and an all-new 6.4-litre HEMI V8. The Ram 2500 offers gooseneck or fifth wheel capability, plus a cargo-view camera for easier trailer loading well as monitoring of bed loads.

What’s garnering a lot of attention in the light-duty line, though, is the new 3.0-litre EcoDiesel, a turbocharged V6 that produces 240 hp and 420 lb.-ft. of torque, yet is claimed to be more fuel efficient than all V6 and V8 gasoline engines in the half-ton pickup category.

The Ram 1500 is offered in regular cab, quad cab and crew cab versions with either two- or four-wheel drive and in short-box (5 ft. 7 in.), medium-box (6 ft. 4 in.) or long-box (8 ft.) versions. Of note, the Ram 1500 equipped with the 3.0-litre EcoDiesel and eight-speed transmission recently won the 2014 Canadian Truck King Challenge.

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TRUCK REPORT

Chevrolet Silverado T

he Chevrolet Silverado 1500 (sister to the GMC Sierra 1500) is the leader for half-ton pickup towing capacity and has a rating of 5,443 kg (12,000 lb.) from its big 6.2-litre V8 engine.

General Motors says its models are new from hood to hitch, and include improvements such as a trio of all-new EcoTec3 engines – a V6 and two V8s; a stronger, quieter and more comfortable cab; a new interior with comfort features and “connectivity,” revised steering, suspension and brakes for improved ride and handling; and new solutions for managing cargo in the bed.

Consumer testing organization Consumer Reports ranked the 2014 Chevrolet Silverado 1500 LT/GMC Sierra 1500 LT crew cab pickups as its top pickup truck choices. With its new design, and equipped

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with the 5.3-litre V8 and four-wheel drive, it edged out the competition in a head-to-head comparison test.

For its new models, General Motors has strategically replaced traditional steel with lightweight, high-strength steels for improved capability, safety and fuel efficiency.

High-strength and ultra-high-strength steels make the Silverado and Sierra’s fully boxed frames and cabs lighter and stronger, helping the trucks deliver V8 consumption as low as 8.7 L/100 km on the highway.

The new Silverado/Sierra models come with a choice of three new engines: a 4.3-litre V6, a 5.3-litre V8 and a 6.2-litre V8. Fuel-saving technologies are designed into all three, including direct gasoline

TRUCK REPORT

injection, variable valve timing, and cylinder deactivation that uses only four cylinders when full power isn’t required.

Silverados and Sierras equipped with the 4.3-litre V6 can tow up to 3,447 kg (7,600 lb.), with fuel consumption rated as low as 8.4 L/100 km on the highway.

On the heavy-duty front, General Motors has already revealed what we’ll see in its 2015 Chevrolet Silverado HD model. Updates for the 2015 model year include new exterior styling with enhanced cooling air flow, which enables the 6.6-litre Duramax turbo diesel and 6.0-litre Vortec V8 to better maintain full power, even under heavy loads and high ambient temperatures.

To improve towing, the 2015 HD will offer integrated cruise control, Auto Grade Braking and Diesel Exhaust Braking (on diesel models). A 6.0-litre bi-fuel V8, which can run on either gasoline or compressed natural gas, will be available on regular-cab, crew-cab and new double-cab Silverado 2500 and 3500 models. StabiliTrak with Trailer Sway Control will be standard on all models, including 3500 duallies.

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TRUCK REPORT

Ford F-150 T

he venerable F-150 has been the Godfather of Work Trucks for decades (it’s still the best selling vehicle in Canada.) For 2014, Ford has kept the changes to a minimum as its pickup truck line-up was refreshed for 2013. Updates to the 2014 F-150 include a bolder front-end design using high-intensity discharge (HID) headlamps on XLT and higher trims, an optional power-telescoping and power folding trailer-tow sideview mirror, and other appearance enhancements.

There are a wide range of engines in the F-150 lineup, including a 3.7-litre V6, 5.0-litre V8, 6.2-litre V8 and 3.5-litre EcoBoost V6. Both the 3.5-litre EcoBoost V6 and 6.2-litre V8 are rated to tow up to 5,126 kg (11,300 lb.). Ford has equipped its entire full-size pickup truck line-up with six-speed automatic transmissions in order to provide reduced fuel consumption.

In all, Ford offers 10 versions of the F-150, from the base XL to the fully-loaded Limited, as well as 15 versions of the Super Duty F-250, F-350 and F-450 models.

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TRUCK REPORT

Toyota Tundra P

ride of the world’s largest automobile company, the Toyota Tundra half-ton full-size pickup truck has been redesigned for 2014 with a bolder, more chiselled exterior and new, more refined interior. It’s the first major redesign of this vehicle since 2007.

2014 Tundra models include the SR, SR5, Limited, and two premium grades – the Platinum and the all-new 1794 Edition.

The 1794 Edition is a tribute to the ranch, founded in 1794, on which the Tundra plant is located in San Antonio, TX. Three cab styles are available: two-door Regular Cab, fourdoor Double Cab and four-door CrewMax, with either 4x2 or 4x4 drivetrains. Short-bed, standard-bed and long-bed versions are offered. A lockable easy-lower-and-lift tailgate lowers slowly with no slam and can be removed.

The new design includes an integrated spoiler in the deck, which helps with fuel efficiency. The front and rear bumpers changed from one piece to three, for lower replacement costs if they get banged up on a job site.

Inside, the reach to the audio and HVAC controls was reduced by 2.6 in. Large knobs mean they can be operated while wearing work gloves. The CrewMax model rear seats can now be folded up for additional cargo space.

Engine offerings include a standard 4.6-litre V8 and an

optional 5.7-litre V8. Both come with a six-speed automatic transmission.

Several enhancements were implemented on the 2014 Tundra to improve performance. Shock-absorber valving has been re-tuned to improve ride quality over harsh surfaces.

Steering feel and straight-line stability were enriched by steering-system enhancements.

Patented aerodynamic stabilizer fins were added to the outside surface of the rear tail lamp lens and the outside mirror bases. They reduce air turbulence along the sides of the vehicle and also aid in enhancing straight-line stability during normal driving conditions and while towing.

When equipped for towing, the Tundra offers a maximum tow capacity of 4,760 kg (10,500 lb.) with the 4x2 Regular Cab Long Bed. The Tow Package provides a tow/haul shift mode and upgrades the cooling and electrical systems. The sevenand four-pin towing hitch connectors sit above the hitch to help avoid damage during high-departure-angle driving. Trailer Sway Control is standard.

The 2014 Tundra is the first in its segment to be equipped with a standard backup camera on all grades, and the only full-size pickup with optional Blind Spot Monitor with Rear Cross Traffic Alert systems – available on some models.

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TRUCK REPORT

Nissan Titan L

ast year, Nissan incorporated a new tailgate design with an aerodynamic rear spoiler and, on SV, PRO-4 and SL trims, an integrated rear-view camera. Amenities include a 120-volt outlet in the truck bed as standard on SV, PRO4X and SL models, along with a centre console 120-volt outlet, and rear reading lamps on the Crew Cab models.

The standard engine is a 5.6-litre V8 mated to a five-speed automatic that includes tow/haul modes. Towing capacity is as much as 2,948 kg (9,500 lb.) for the King Cab version.

The big news from Nissan will come with its next-generation 2015 Titan. This all-new truck will add powertrain options and cab-and-box

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configurations to broaden its appeal when it comes to market at an as-yet undetermined date.

Significantly, the new Titan will offer a newly-developed Cummins V8 turbo diesel.

“We have done our homework on the nextgeneration Titan. Truck owners told us there’s a demand for the performance and torque of a diesel in a capable truck that doesn’t require the jump up to a heavy-duty commercial pickup,” said Fred Diaz of Nissan North America.

Bill Roebuck (bill@roebuck.ca) is a voting member of the Automobile Journalists Association of Canada (AJAC).

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CONTRACTOR U

Success Story

How Lou Orazem of Inspire Homes has transformed his business

A

Lou increased his sales by 48 per cent yet still has time to meet his kids off the school bus. photos : john tizzard

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ttending Canadian Contractor’s Reno Summit 2013 seminars in November gave me a chance to meet many contractors who read these pages. Some of them told me that they often read these Contractor U articles over and over again so that they can make sure that they fully understood the business concepts that I’ve presented.

The part I enjoyed the most was hearing about the successes people were having when they implemented these ideas.

It was this experience that made me think, “Let’s do an article on a contractor who has had a real-life change happen in their business.” So I asked one of my Renovantage members, Lou Orazem, the owner of Inspire Homes, Caledon East, Ont., to tell us his story in his own words.

Lou is a highly sought-after full-service design builder and renovator who works from the Greater Toronto Area to Georgian Bay. He’s a two-time winner (2009 and 2012) of the Renovation of the Year Award from BILD (Building Industry and Land Development Association, the major homebuilders’ association in the GTA). I want to thank Lou for sharing this with us.

Mike Draper, Renovantage.com

CONTRACTOR U

By Lou Orazem

E

ighteen months ago, we made a conscious decision to grow our business. Sales are now up 48 per cent this year, and I couldn’t be more pleased.

Let’s start by looking at where we were. Sales were averaging $750,000 per year for the previous three years.

Part of the reason was that the business was built around the needs of my family. Shortly after the birth of my daughter nearly 10 years ago, I left a career in the banking industry to get into a business where I could have more control over the hours I worked (though not necessarily the number of hours I worked).

But now that my children have finally reached the age where they are in school full-time, I feel the time is right to significantly expand my company. The business is still built around my family’s needs – I’m home when my children get on the school bus, and I’m home by the time they get off the school bus.

We started a custom newsletter Marketing has been the one of the keys to our success.

Our website has been our key marketing tool since day one. We’ve made several significant changes to it over the years, including adding a blog two years ago. The blog is there to educate homeowners and highlight projects that Inspire Homes has recently completed. It has helped us grow from 600 visitors per month to 3,000 in recent months.

In 2012, we started sending a custom newsletter to past customers, prospective customers that did not buy from us, trade contractors, suppliers and architects. Leads from these sources have increased since the newsletter was initiated – but more importantly, we can directly attribute 17 per cent of our sales growth last year to the newsletter.

Entering projects into the BILD Renovation Awards also has been an important part of our marketing plan. The Best Renovation Awards we won in 2009 and 2012 have been important to building our credibility. While submissions are due in early November, preparing is a year long process

– starting with identifying projects that we may want to submit for the awards, paying attention to design details and production selections, and properly photographing these projects before and after. The awards have put us into a mindset where we approach every project by asking, “How can we make it a winner?” Awards have also put us into the habit of getting professional photos of our projects, which has led to some fantastic material for our website.

The direct result of these marketing efforts has been an increase in the number of leads we have received. Overall leads have more than doubled in the past two years. Leads for house addition projects have grown 150 per cent.

We transitioned to 100% design-build Another key to success has been attracting more design build projects. Homeowners are looking for one-stop shopping, and they are telling us they believe the builder is most qualified to lead the design build team.

In the past few years, about 60 per cent of our work has been design build. Last year it represented 100 per cent of our work – and we expect all of our work will be design build again this year. Design build is an excellent way to keep a steady work schedule, and we typically have anywhere from 6 months to 12 months of work booked.

Because design build has a long lead time – in some cases it is a year before the job goes into production – it is important to stay focused on sales.

We added a production manager We added a production manager in 2013 to address the higher volume. Lead carpenters are focused on daily tasks and the current week. The production manager’s role is to deal with the two to three week schedule, ordering special order items, dealing with change orders, client communication, etc.

This is the first management position that we have ever added, so the transition has been a learning process. We

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CONTRACTOR U

decided to hand over one job per week to the production manager, rather than all four or five at once. We started with the hardest project, and then continued to move projects over to him.

Adding a production manager has shown where the gaps are in our current production system, specifically what is in my head rather than being on paper. We are addressing this by documenting and implementing new procedures constantly. For example, our latest procedure is “How to select a subcontractor,” a step by step checklist of questions to ask, information to verify, etc.

We use BuildTools, a web-based construction management program, to maintain information between office and field.

Scheduling, product selections, and communication are maintained in one central web-based portal. Our projects are located as far as an hour away from our office, so electronic communication is vital.

Hiring a production manager has allowed me to spend more time focusing on sales, and to move more sales calls to the daytime hours. About 60 per cent of our sales calls are now done during weekday working hours; the remainder are on weeknights. I haven’t done a weekend sales call in eight months. Interestingly, we close more jobs that we go see during the day, although our sample size is too small to definitively say this is a trend.

We added a warranty and service manager Our latest initiative has been to add a warranty and service manager. Lead carpenters are focused on day to day activities on their current projects, and it is hard to pull them off for a day to go deal with a warranty issue. Sometimes the issue requires further investigation, follow up with suppliers and specialty trades. As the client list grows, so does the list

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of warranty and service calls. We offer a two year warranty, but we’ve been known to go back five years after the job has been completed and take care of a repair at no charge to the homeowner.

We identified the ideal service technician would be semi-retired with many years of construction experience.

We finally found an ideal candidate, a former construction business owner who sold his business a couple of years ago, who is looking to remain involved in the construction field, and is happy to work a few hours a week.

We track every number we can We always have two budgets – a preferred budget, which is the sales that we would like to achieve, and a worse case scenario budget, which are minimum sales that we need to achieve to continue as a business. It is important to know both sets of numbers, however the downside is a tendency to be satisfied with a lower sales number.

Working with Renovantage Business Coach Mike Draper has kept us focused on achieving our higher goals.

It has created another level of accountability, and the insight he is able to offer from many years of working with construction companies is a valuable resource.

We approach all new initiatives the same way: identify the results we want to achieve, create a plan, implement the plan, and then assess the results. We closely track results and compare to our plans, and we will change course when something is not working.

We track everything we can and are constantly looking to see what else we can track. A couple of weeks ago we received two leads that were referrals from prospects who didn’t buy from us, but still thought highly enough to

CONTRACTOR U

IKO Organic Shingles ~ Certification of Canadian Class Action IKO Organic Shingles mean all asphalt organic shingles manufactured by or on behalf of IKO Industries Ltd., Canroof Corporation Inc., or I.G. Machine (the “defendants”). See the full legal notice (online at www.classaction.ca) for a list of brand names. The action does not relate to IKO fiberglass shingles. IKO Organic Shingles have not been manufactured since 2008, and have not been sold since 2010.

recommend us to their friends and neighbors. So we’ve added another lead source to track.

We are targeting a 50% increase in 2014 We are again targeting 50 per cent growth for the coming year. We need to grow beyond our current sales to support the infrastructure we’ve built over the past year and to generate a healthy profit. Our solid marketing program and our design build business model gives us the confidence that the goal will be achieved. As of early November, we were more than half way to reaching our 2014 sales goal.

My personal goal is to reduce my work week to less than the current 55-60 hours a week. I want to take a day off once a month and go snowboarding in the winter and cycling in the summer. But I’ll still be back by 4 pm when my children get off the school bus! cc

Endnote from Mike Draper Having read Lou’s inspiring story, you may be asking yourself, “Is this really possible in my business?”

Well, having worked with many contractors who have made major positive improvements in their profitability, I can assure you that, yes, dreams can come true. But not until you remember…

First, you’ve got to have one (a dream)!

Second, you’ve got to change the way you think.

And third, you need to change the way you do things now.

And although you’ve undoubtedly heard this before, I’ll repeat it one more time: “If you keep doing what you’ve always done, you’ll keep on getting what you’ve always got.” Hold onto your dreams – they’re real.

Mike Draper is a business coach for Renovantage (renovantage.com) and a frequent contributor to Canadian Contractor. See more of his columns and videos online at canadiancontractor.ca. Type ‘Mike Draper’ into our search bar for easier access.

Certification of the Class Action - A class action related to IKO Organic Shingles has been certified by the Ontario Superior Court of Justice. This means that common issues will be determined in a single proceeding on behalf of members of the certified class, subject to further order of the court.

What the Class Action is About - The representative plaintiff, on behalf of himself and the Class, is claiming damages from the defendants for the alleged negligent design and manufacture of IKO Organic Shingles. Specifically, the representative plaintiff alleges that IKO Organic Shingles were negligently designed and manufactured in a manner that, under normal conditions and usage, would result in premature failure. In addition, with respect to persons in British Columbia, Saskatchewan, Manitoba, Quebec and/or New Brunswick, the representative plaintiff asserts claims for breach of consumer protection legislation in those provinces. Specifically, the representative plaintiff alleges that the defendants breached the consumer protection legislation by representing that IKO Organic Shingles complied with industry standards when he says they did not comply, or were not adequately tested in order to determine whether they did comply. The representative plaintiff seeks damages, on behalf of himself and the Class, for, among other things, the costs of removing and replacing defective IKO Organic Shingles, including associated labour costs. The defendants deny all of the claims made in the class action and the allegations have not been proven in court.

The Class - The certified class includes current or former owners or lessees of buildings located in Canada that contain or contained IKO Organic Shingles. See the full legal notice for the complete class definition.

Common Issues - The class proceeding will determine the common issues relating to whether IKO Organic Shingles defendants were negligent in the design and manufacturing of IKO Organic Shingles and whether the defendants breached the relevant consumer protection legislation. See the full legal notice for a complete list of common issues.

Opting Out - You can opt out of (exclude yourself from) the class action. If you opt out, you will not be eligible to participate in the class action, but you will be able to sue the defendants on your own in respect of the claims discussed in this notice (subject to any defences the Defendants might have, including any limitations defence). If you do not opt out, you will be able to participate in the class action and will be bound by any judgment issued in the class action (whether favourable or not), but you will not be able to sue the defendants on your own in respect of the claims discussed in this notice. The deadline for opting out is January 29, 2014. See the full legal notice for more information.

Financial Consequences - If the common issues are determined in favour of the Class, class members might be entitled to receive financial compensation from the defendants. In that event, participation of individual class members will likely be required to determine individual entitlement. You should retain copies of all documents and evidence that might be relevant to the determination of your individual claim. See the full legal notice for more information, as well as information about costs and counsel fees.

Additional Information - The law firm of Siskinds LLP is counsel for the Class in this matter. For questions not answered in the full legal notice (online at www.classaction.ca), contact Siskinds LLP by email at ikoclassaction@siskinds.com or call toll-free 1-800-461-6166 ext. 2446. To receive future notices regarding this class action, please register online at www.classaction.ca.

This notice has been authorized by the Ontario Court.

Questions? Visit www.classaction.ca, call 1-800-461-6166 ext. 2446 or email ikoclassaction@siskinds.com

www.canadiancontractor.ca

January 2014

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BUREAUCRAT OF THE MONTH

I. David Marshall

President and CEO, WSIB Annual salary: $400,000 plus taxable benefits, plus WSIB pension Contract: 5-year term ends January 23, 2015 Bonus: $400,000 at end of contract if, his contract says, he achieves his “goals and expected outcomes (which) include, but are not limited to the development and implementation of a financial plan to reduce and ultimately retire the WSIB’s unfunded liability, as well as improvements in administrative efficiency and service delivery.”

I. David Marshall President and CEO, WSIB (Ontario’s Workplace Safety & Insurance Board)

WSIB annual revenues: $4-billion approx.

WSIB employees: 4,000 Employers served: 255,000 Workers served: 4.2-million Workers receiving benefits: 250,000 approx.

Previous posts: • Canadian High Commissioner to Barbados and the Eastern Caribbean (2007-2009) • Deputy Minister of Public Works & Government Services, Deputy Receiver General for Canada (2003-2007), a job for which he came out of retirement in Provence, France after a long career (beginning in 1977) in the public service as well as international banking. He has also served as Assistant Auditor General for Canada as well as Assistant Deputy Minister for Revenue Canada, where he was responsible for the technical implementation of the GST. Important priority: • To reduce the WSIB’s unfunded liability, which currently stands at $13.2-billion.

Important legislation: • Bill 119, which on Jan. 1, 2013, extended mandatory WSIB coverage to include owners, partners and independent operators in our industry.

How many new WSIB contributors the government was looking for from Bill 119: • “45,000 to 90,000” (according to Elizabeth Witmer, chair of the WSIB, to the Standing Committee on Public Accounts, Oct. 2, 2013).

How many of these contractors have actually registered for WSIB: “About 20,000” (quoting Witmer, as above) Sources: WSIB website, wsib.on.ca, “Backgrounder: Salary and benefits disclosure,”CGA Magazine

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www.canadiancontractor.ca

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