Contractor teaches well-paid employees how not to be broke

April 16, 2014
Schols wanted self-improvement to be integral to the company and he wanted the employees to buy into it. Schols decided that if he wanted to have good employees who stick with him, he would train five days a week. Schols decided to try using the Dave Ramsey Financial Peace University class.  

LAS VEGAS — Kelly Schols, the owner of CPI Plumbing in Mt. Vernon, Wash., probably did not expect that he would create some of the biggest buzz at the Service Round Table’s International Round Table here, but that’s what he did. It seems like every other contractor in the room has had to deal with well-paid employees being broke, but Schols found a good way to handle it.

Mt. Vernon, Wash., is a market area of about 85,000-100,000 people. Schols started in the business at 22 and bought into company when he was 24 when the firm was 85% new construction. He bought out his partner in 2002 when the company was billing $1.9 million, mostly new construction. By 2009 CPI had revenues of $5 million, mostly new construction, and Schols started the transformation to service contracting. In 2010 CPI’s revenues were down to $3 million and Schols was facing a $350,000 pension liability for withdrawing from the multi-employer pension fund, but he, nevertheless, was able to pay off the union.

Schols wanted self-improvement to be integral to the company and he wanted the employees to buy into it. He held training couple times a week using materials such as Charlie Greer’s Tec Daddy videos, he joined the Service Round Table’s Service Nation Alliance, implemented Joe Cunningham's Perfect Service Call and tech packs, and used training materials from Kenny Chapman.

Schols decided that if he wanted to have good employees who stick with him, he would train five days a week and he’s been doing that three to four years. Every morning they meet at 7:30 and his guys have said that they don’t want to cut down on the training. Every Monday it’s a Kenny Chapman training video online and Tuesday’s it’s self-improvement class. He’s currently running through the Uniform Plumbing Code page by page. Wednesdays feature roundtables on topics such as how to sell service agreements and good ideas from employees. For example, he went to seven-days-a-week service and wrote up a schedule that the techs didn’t like, so in the roundtable the techs created the schedule, which has been implemented now for two years. On Thursdays they role-play. On Friday it’s technical product training.

Training may be voluntary but if guys don’t show up for training, the other techs will eventually push them out because they aren’t buying into the company culture.

You need a lot of content for five-days-a-week training, so Schols decided to try using the Dave Ramsey Financial Peace University class. Dave Ramsey is a best selling author and teacher whose focus is helping people get out of debt, save, and invest for the future. Since Schols wanted employees to be serious about it, he charged them $79 for Dave Ramsey’s book, the workbook, and 120 days of online access to Ramsey’s website. The class started in May 2013 as a voluntary program.

One of the first steps is to write out what total debt load. He had 14 people taking the class, and 11 of the employees had debt, not including their mortgages, of $164,000. One employee inexplicably decided to buy a new car for $11,000 in the middle of the program, so it brought the debt load to to $175,000.

The course discusses bad money habits, something that afflicts most Americans. On a national basis, 53% of employees are dealing with personal financial issues during work time; 45% could not cover a $1,000 emergency (the emergency fund should be in a separate bank account); 69% constantly stress over finances, which affects their health; 70% live paycheck to paycheck.

This struck a chord with the other contractors, who talked about it at length in the meeting rooms, in the corridors or over cocktails. Evidently all of them have had to deal with employees’ financial problems.

“If you teach employees how to manage their money, they won’t come to you for money and it won’t affect their work,” Schols said. “Broke affects your business,” such as people moonlighting or fighting with their spouse over money during working hours.

After completing the class in three months, the debt load of the 11 had gone down to $138,000, which Schols is certain would not have happened if he had not held the class for them.

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