This has been a very busy winter and spring for us. Joshua is finishing his last semester at Kennesaw State, and will be graduating in a week. It's hard to believe that in September it will be 4 years since he joined us. At the time, it was just me working out of my house. Joshua called me on a Friday, and asked if I was looking to hire someone. I know his parents well (I rented my office space years ago from them), so I asked him to come for an interview on Saturday. I conducted the interview by sending him intoone of the worst crawl spaces I've ever seen. He didn't mind, so he got the job. He had no engineering courses under his belt at the time, knew very little CAD, but had the desire to learn. Now he's well versed in the intracacies of timber, steel, and concrete design, wind loads, seismic loads, building codes, and all the other stuff we do Amazing...
While Joshua has been occupied with his last semester, we've had some of the largest projects we've ever done thrown on us. The Haven at Haymarket II was a difficult one, Joshua did the initial concept, I designed the steel structure, and AJ put the design together and prepared the documents. It was not our first design 3d created in REVIT, but it was the first one that the Architect passed us along the original design in REVIT and that we continued.
In this issue I will cover briefly The Haven project, and our experience with collecting bad debts. I look forward to working with you all this summer!
George
George W. Runkle III, MS, PE
President
RUNCON, Inc.
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Many of you have had issues getting us on the phone this spring. We have had real telephone hassles. You would think that telephone service in a nation that sent a man to the Moon about 50 years ago would be pretty simple. As you all know, that isn't true.
For a few years we've used Ooma for getting calls over the Internet. We switched to Ooma for business, which gave each of us a line. That doesn't work out so good - people didn't know whether to select Joshua, AJ, or myself. Then if the phone rings, you have to find the right handset and by that time it's gone to voice mail. That wasn't the worst. Ooma for some reason started cutting calls off after a couple minutes. That doesn't work well when you are talking to an important client.
So, we switched over to using Comcast, since our Internet package includes a couple of phone lines. They charged me for porting over the phone line (of course) and I had to get a visit from their installer. OK. Then I went looking for a decent wireless phone system to connect with. I got one with voicemail, but I found out after I got it that it doesn't allow you to record a message. It answered with a generic "the person you have called is not available...". That doesn't work for a business. Also, with that phone system, the default for voicemail was two rings, which meant all of our calls when to voicemail, which is even worse. So, I had to go back to Comcast and get voicemail. You'd think that would be pretty simple, but it took a week.
Oh, by the way, the problem wasn't solved. Ooma was periodically answering the phone with its voice mail. I had to call them and cancel Oooma, which should have been the end of it, but it isn't. It STILL occasionally picks up and switches you to their voice mail.
Other than that, I think we're good now. Now if I could find a way to block out all the telephone solicitors and robo calls....
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Getting us on the phone has been a bit difficult this spring - it hasn't been easy to fix.
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This is the 3d Model in REVIT that was used to create the design drawings.
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This is the structural model created in the Bentley RAM Structural System. Everything from the containers, to the beams, the foundations, and the steel connections are modeled here and subjected to all the loads, including earthquake and wind loads.
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THE HAVEN AT HAYMARKET II
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Our latest project is quite challenging. It's a three story buiding near Charleston, SC made with conventional construction in the first floor, and shipping containers for the next two floors. We just completed the design and we're waiting on comments from the Building Officals.
It was challenging because the Owner needed to be able to keep the first floor open so tenant buildout would be more flexible. That meant we couldn't use cross bracing to stabililze it for wind loads Making it even more difficult is it is located in a high wind zone AND a high seismic zone.
Of course that doesn't quite wrap up the complexities - the building cantilevers to the front and the right side, and that had to be supported too.
Getting a bit technical, the building is designed with Special Moment Frames on the ground floor to resist seismic and wind loads. The containers themselves were fairly easy, the long line of them allowed us to go without cross bracing in the front where the balconies are placed.
We did our design drawings in 3d with Autodesk REVIT, and our design calculations were done in 3d with Bentley RAM Structural System and by hand as needed. It took over an hour and a half for Bentley RAM Elements to do the calculations for the structure by the way.
If you ever are stuck in Charleston during a bad hurricane, this is the place to take shelter.
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Collecting from the Deadbeats
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In this business we all have run into problems getting paid. The basic problem is on most jobs whether we are the contractor, architect, or engineer, we don't get paid until our work is done. The client often doesn't have the money to pay us until we finish the work. If I am working under an architect, the architect has to invoice the owner for my work. The the owner has to pass the invoice to the lender to get a draw to pay the architect, who pays me. The same goes for the contractor and all the subcontractors.
This system leads to a delay in payment, which is taken advantage of by people who have no plan on paying us in the first place. I've segmented the non-paying customers into a few categories:
- The Fly By - this is a customer that is only planning on using you once, and it is for a relatively small job. They figure you won't bother to try to collect. In my business, I'll sometimes find out their contact information is fictitious.
- The Confused Customer - this is the customer that loses your invoices or has internal procedures that results in your invoices getting hung up in processing. Often the Confused Customer is the one generating you the most dollars, because it is often a large company.
- The Dissatisfied Customer - this one claims there are problems with your work and won't pay. You have to be careful, because with some of these, the customer really is dissatisfied, and a collection effort can cause a lawsuit. The deadbeat knows this, and takes advantage of it.
- The Broke Customer - this customer is having problems and just can't pay you. Sometimes they have been a good customer, but they took on some deadbeats themselves, or are going through problems.
There are more complexities of course, but it helps to segment the customer to determine how to do your collection efforts. For the Fly By and the Dissatisfied Customer, you need to take a formal systematic approach. Again, let me warn you, think about the Dissatisfied Customer - make sure you aren't walking into a lawsuit. Try to reason with the customer first to take care of the problem.
I've found the best solution for the above two customers is filing a lien and/or using a collection agency. Liens are good if the property is going to be sold, otherwise they are of limited effectiveness because they expire in a year in most states. There are services that file liens for you, I use
Lien Filers for properties in Georgia.
There are many collection agencies out there, but my best experience has been with
OldDebts.com They will send out a series of collection letters and offer add on services such as reporting to credit agencies and telephone calls. If the letter series doesn't work, you can turn the debt over to them for contingency collections.
I have to say, I have only had two debts in 20 years of being in business pay me off in contingency collections. Generally if you get that far they aren't going to pay.
You can also go to court, but for the amount of money we are often owed, it isn't worth it. It also requires you to collect on the judgement, which isn't a sure fire thing. Again, this is what many dead beats count on, which is just a fact of life.
There are aggressive collection agencies out there who push the limits of the law to collect for you. I used one such agency to collect on some debts, and they got a few people that owed me money to pay. However, they never turned any money over to me. So, I was stuck with trying to get a collection agency to collect from a collection agency.
For the confused customer, I don't recommend a collection agency or any other type of aggressive moves, it is counterproductive. It's important to keep in contact with them, and you may find yourself calling various people in their company to guide your invoice through their processes. They may need you to fill out various forms, submit insurance certificates, W-9's, and lien releases. These are usually large companies. It's best when you get one of these to reflect the difficulty in collecting in your pricing.
For the broke customer, turning the debt over to collections is a waste since you can't squeeze blood out of a rock. Filing a lien is worse, because you may prevent them from being paid, ruining any chance you have of getting paid.
Generally, with a broke customer as long as they keep talking to you they are going to pay you. Keep in touch with them, and you may be able to push yourself to the top of the list of people they are going to pay.
I hope my experiences will help you in this unfortunate yet critical part of our business.
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Runcon provides structural engineering and forensic engineering services.
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