Dan Dowdy - Ep. 16- Creating an In-Demand Company Culture

This is the Wealthy Contractor Podcast brought to you by G4 Marketing. Interviews with today's top home improvement entrepreneurs about marketing, sales, money, mindset, and lifestyle.

Now here's your host, Brian Kaskavalciyan.

Hello and welcome to the Wealthy Contractor Podcast. This is Brian Kaskavalciyan with G4 Marketing Group. The number one challenge that contractors, even wealthy contractors share with me daily is how they struggle to find good help. I think it's something we all struggle with. One wealthy contractor who has not only overcome this challenge but has turned it into one of his company's greatest strengths is Dan Dowdy of S&D Plumbing. Now, Dan's created a company culture built around customer service and fun that attracts young, talented employees. This reputation for being passionate about their customers and their employees has driven S&D Plumbing to transform their business in the past 6 years. Now, Dan and his family have created really a wonderful business in Austin, Texas, and in this episode, you'll hear him talk about the challenges of finding good people and some of the strategies they use at S&D to not only recruit great talent but also retain great talent. So let's get to it.

All right, everybody, welcome to this episode of the Wealthy Contractor Podcast. Now, this is a special episode because in this episode I am interviewing our first plumbing contractor, which is very exciting. And I have got just the right guy to talk to. His name is Dan Dowdy. His company is S&D Plumbing. Dan, welcome to the Wealthy Contractor Podcast.

Thank you. I really appreciate you having me on and, you know, look forward to sharing some knowledge with everybody today. Cool.

So tell everybody a little bit about S&D Plumbing today, and then we're gonna— and then I'm gonna ask you a little bit about where, where it started. But let's give everybody some perspective on where you're at today.

Very cool. So, you know, we're located in the Austin area, actually Taylor, Texas, where we're located at. We're roughly about 35 employees. We do about 90% residential service. The other 10% is commercial service. We don't do any new construction or remodeling. We also specialize in leak detection as well. See here, we're about a $7 million revenue company a year. So we're still a small company. We're really passionate about our employees. We know we're really providing the world-class customer experience for all of our customers. And we have a great culture and a great environment. We're all about hiring the millennial generation and really raising these kids up to be really something very successful through our company. I'm sure we're going to talk more about that today.

Well, God, that's like one of the first things that we're going to have to talk about. You mentioned millennials. It makes me shake. How many trucks? How many service trucks out in the field?

We have 10 service trucks, 2 drain cleaner trucks, and we run about 5 underground excavation trucks, sewer line, different things. Wow.

Awesome. Lots of moving parts, but very well-run organization. Now, give us a little history. Tell us, you know, just give us the 2-minute version of when S&D started and kind of the backstory.

Yeah, so S&D started in 1980. I'm second generation, so my parents started the company out in Galveston, Texas. About a year later, moved to Austin. I've been in the Austin area ever since. I grew up in the company for a long time. You know, we, we were a very small company, 1 or 2 trucks. My dad kind of did remodels, new construction, service, whatever he can get ahold of. And, and really I would say over the past 20 years has been our major growth. And I've been involved in the company full-time since 2001. We've always been known for our quality service, family-owned company, and we have that great reputation. And then really, I guess about 6, 7 years ago is when we really, we really started to look at things. So at that point we were doing, we were, we were depending heavily on insurance companies. Used to give us leak detection work that would lead into our tunneling excavation work. That was a big part of our business. Well, 2008, that timeframe, I started thinking, you know, what happens to my company if we lose all of our insurance work? And at that point, that's when I realized that I gotta get my butt in gear and start growing my service company and really not rely so much on our insurance work for our plumbing, I mean, for our revenue. So that's when I got connected with an organization, QSC, that really started to get hands-on coaching and really starting to learn from my peers what that looks like. I'm very much a firm believer and not trying to invent the wheel, but just trying to take something, take it and make it better in my company. And so at that point, you know, we went and we kind of went a different direction with our service. You know, we started flat rating our pricing instead of doing what I would consider the old school hourly type pricing for our customers. You know, our techs went commission and we really just started being more progressive in everything we were doing from the way we were writing systems for our perfect service call all the way down to the way we were marketing our company. And I would say, you know, really in the past 6 years we've doubled, we've We've easily doubled in size while maintaining the same great reputation, the same great customer base. And really, at this point, everybody's happier than they ever have been before, both employees and customers. Very exciting stuff going on.

You mentioned a couple of interesting things there. I mean, I think that asking yourself the question, what happens if my main source of business goes away? When you ask yourself that question, which is a great question, by the way, I think that, you know, I was a— in our business, which is a little bit different from yours, but still, you know, we have clients clients and we service our clients. We had one client— there was a time about 3 or 4 years ago, we had one client that was probably 20% of our business, and I, I waited a little too long to say, hey, what happens if that client goes away? And guess what? They went away, and I wasn't prepared for it. And I, and I think that's really smart that you did that ahead of time. How was the transition going from a leak detection business that is reliant on insurance companies providing leads, customers, sales, to having to go out and develop customers, residential?

I mean, the transition, you know, thinking back to that, it really wasn't easy. I mean, first of all, I had to deal with not only my employees, I had to deal with a business who's been doing the same thing for 30 years.

Yeah.

And, you know, I had parents involved in the business that have been doing— have successfully been doing the same thing for 30 years. So to convince everybody that this is the right way to go took a lot of you know, it took a lot of push on my end, but at the same time, really my biggest success came when I hired people that were smarter than myself to teach me how to get there. And I'm humble enough to say that. And, you know, I'm very innovative. I'm always striving for the next big thing and trying to stay ahead of the curve. But, you know, it's really— it was that, and then it was building a culture of a company that not only— because we've always been passionate about our employees and our customers, but really getting to the point where we're creating a culture of experiences that's really bringing in the young generation. Because, you know, when we say millennials, we all think, 'Eh, they don't want to work,' or whatnot. But we have a lot of great, hardworking people that aren't entitled that are millennials that are here to work and here for the long haul. But it's really building that culture inside your business that, for me, we became more successful the more experiences I created. And I'm talking like simple experiences like cooking out after work, grilling some steaks for the guys, or taking them on a fishing trip. Trip, or, you know, doing a spa day for the ladies in the office, or, you know, washing cars on Fridays, or just little things like that. You don't realize how far that goes for, you know, for your employees in certain generations. Well, it's, you know, for us, it's made us who we are, and it's really a cool place to work.

Yeah, I just want to point out one thing to everybody that's listening to this. Dan said something, he said it real quick. He said he hires people smarter than him, and that is one of The— I think from every— if you look at every level of business where you've got people that are high achievers, very successful in their businesses, you will hear them say some variation of what you said, that they hire people smarter than themselves. And I think that what you really kind of mean by that is that you are not a CPA, as an example. You are not a certified public accountant. You are not a chief financial officer. That is not your chief area of expertise. And so you go out and you hire the best person that you can for your company that's going to help you go to the next level. And I think that's what you— what you mean by that is you go and hire people smarter than you. Because the truth of it is, as entrepreneurs, as business owners, we only have a few jobs. We really only have a few jobs. And they don't require a whole lot of quote-unquote work. One of the jobs is surrounding ourselves with people that can do the job that needs to get done the best way possible or at the best level possible. And so I think what happens is a lot of people let their egos get in the way and they say, well, I don't want to hire people smarter than me. I want to be the smartest person in the room. They might not say that out loud, but that's going on in the back of their head. You'll never grow your business unless you surround yourself with people that know production and focus on production 100% of their time. Because as the owner, how much time can you spend on production and creating all the processes and systems and, and maintaining those systems on a day-to-day-to-day basis? It's just not possible.

That is correct.

And so I just wanted to point that out because I thought, man, that was just— that's a golden nugget of information that you dropped. And I just want to make sure that we don't just step right past it and realize the way that I, I heard, um, there's a guy that wrote a book called The Rockefeller Habits, and now the updated version of that is called Scaling Up, a guy named Vern Vern Harnish is really a really smart guy. He works with some really big companies to help them grow and get to the next level. And he said something that I wrote it down when I heard him speak a few months ago. He said, if you want to 10 times your company, 10 times your people. And it's really all about the people that you surround yourself with. Which brings me to— let's, let's talk about, because you've brought this up a couple of times, and I'm gonna— I want to touch on customers, but I want to touch— I want to talk about this whole millennial thing that you keep bringing up because I know you guys have this killer program that's called Plumbing Pipeline. And so you brought up millennials a couple times. Tell everybody what Plumbing Pipeline is, kind of what's going on with it in your organization.

Exactly. Okay, I'd be happy to. And really, the way— the reason why Plumbing Pipeline started is, you know, my dad and I sat back and said, we're seeing these kids come in and apply with college education and have debt and They can't afford to live because they're trying to pay off school debt and they have no, no jobs for what they went to school for. And we're like, what happened to our schools? You know, why is trades not back in the schools? So mainly it was driven by, you know, Sam Dowdy, my dad, and he really got passionate about it. And he's like, I'm bringing the trades back to the school. So he went around to our local high schools and he didn't get accepted everywhere, but he got accepted in 3 or 4 local high schools where he talked to the administration and let them know that, Hey, here's what we're looking to do. We're looking to plug in an individual that has steady A and B grades, that is a hardworking person, guy or girl, that doesn't want to go to college, but that wants to have a career somewhere in the trades. And, you know, it's hard to find that person, right? Most kids don't know what they want to do. But, you know, we're fortunate enough to get 2 or 3 a year that start working with us as juniors in high school. And they come in after work, after school program, which is usually here about 12 o'clock. And, you know, we just mentor these kids. I mean, they do everything from stocking our shelves to sweeping our floors to going out on service calls to running parts around to washing cars, really, really to doing anything in the business. But we make them a part of our business and a part of our culture, and we accept them. And then the really cool thing is, is we team up with PHCC, and we actually present them with a $25,000 scholarship for a 4-year trade school when they graduate school. So it's really— Once you do that a few times, the ears start perking up and you have parents saying, "Hey, I want my kid in that program." So they graduate, they come to work full-time, and they go to school, they go to trade school full-time for 4 years to learn the trade. That's been a big part of getting the really younger generation up, and they're really loyal to you after 2 years of doing the after-school program. So that's one avenue of how we do a lot of our recruiting.

The second avenue I was just gonna say, it really amazes me, you know, you said about these, these kids that come in, you know, after college and they've got all of this debt. It's funny that if they went into your field, if they went into the plumbing field as a technician or HVAC field or electrician, they could actually make a really, really good living as a technician in a good plumbing company like yours. And in a lot of cases, when they're young, probably even more than they would be offered at a white-collar job, let's say. 'cause, you know, obviously plumbing is a blue-collar job, right? But, um, God, there's so much opportunity in the trade for these kids, and it's what you guys are doing to make them aware of it I think is great. Plus, it's solving a problem that a lot of people have right now is, well, how do we get good employees? How do we get good people? We're growing, but we just don't have the people to keep up with our growth. So anyway, I just wanted to make that comment. You were going to say the second part of The second part of it.

Well, yeah, I mean, it's, it's funny you say that too, because I, you know, it sounds crazy, right? Everybody wants to hire a licensed plumber for their plumbing company. Everybody wants to hire a licensed HVAC tech, but people that are listening that own home service companies with licensed professionals know that they typically come with a preconceived standard of what the plumbing should look like. And they have their own notion of, you know, how they're going to act in your company. And a lot of times it doesn't fit your culture. And I started thinking back a year ago thinking. And I was thinking about all my employees and I was like, how many guys did I hire that came with a license that still work here? And I had one. And I was like, damn, I was thinking, man, that's a lot out of so many employees. That's not a very good rate. So I started thinking, what's wrong with that picture? And I realized that that's it. You know, I have a specific culture that I've created here in my company. It's a culture of having fun doing what we love to do while being a world-class customer experience company. You know, I mean, we are the best in our market, in our industry. And what I do now, I got free ads on Indeed and it goes to my careers at S&D Plumbing. And I have at any time, I have over 300 resumes on there that when I'm ready to hire once a month, when I'm recruiting and I bring in for a group interview, I'll go through and I'll call 10 of them and I may get 5 to come in. And I strictly hire based on their character, based on personality, based on, you know, what they say in the interview. I don't hire based on skillset. Um, I don't hire, you know, and I do that both for for office and technicians. Now, it gets a little different, you know, when I start hiring for my leadership team, but it never— I've been doing that, and the cool thing is, is you have people that come in with no preconceived notion of what a plumbing company should look like, and they buy into what you're doing. And yes, you gotta— it's painful because in our industry we got to invest at least 2 years in somebody to actually start making— for them to actually start making a decent living. It's something that if you're going to shift your culture and you're going to say I'm going to do that. There's going to be a lot of growing pains in that next 2 years because you got to start raising those kids up. And so now I have it to where every year I have 4 or 5 kids that I say, all right, you know, you're, you're the next generation. Y'all are up for licenses next in 2018. So I can expect to typically only have maybe 2 or 3 that end up panning out to be really good. But I already have those guys targeted every year because I know that I want to grow by 2 service techs every year. I mean, that's at least my vision of my company, and people think I'm crazy because of that, but you know, it works, you know, and I don't have to deal with the drama that most home service companies have to deal with, with hiring the wrong people and then having them go out and screw your customer and lose business for yourself.

So you've mentioned company culture and you've mentioned fun. Tell me a little bit about that. What is that? What does that look like at S&D? I mean, obviously we need to come and experience it. Tell me a little bit about the culture and about this idea of fun. You mean by that—

well, you know what, we're rarely We're not really ever serious unless we have to be, but it started with me thinking, you know, if we're going to be successful as a company, I want my employees to feel the success through incentivizing them. And really, I want every position to be able to be incentivized for our success. And so we started with that, and I started really driving that and changing how that looks for each position. So that got everybody excited. But really, then I started realizing, you know, I would dangle cash in front of people, and they really didn't get excited about it, at least the millennial generation And did not get that excited about it. So then I started thinking, well, what's— I mean, what are they excited about? So, you know, we do our annual— we're leaving on— we're actually leaving Friday to go on our annual fishing trip. We go for 2 days, all expenses paid, and rent some fishing cabins to have a great time. But we do things like fishing trips.

Everybody with everybody, with everybody.

Yeah. We do fishing trips. We do 4th of July parties. We do, you know, if we hit our sales goals for the week, I'll go buy some steaks and we'll grill some steaks after work. We do, um, every fall we do a camping trip, which we invite all the employees and their families to come to. It's more of a family-type atmosphere. So it was really, you know, we found that that's what they really dug. You know, if I'm trying to say, hey, let's have a contest of who can get the most reviews, if I'm dangling $300 out there for the winner, or if I'm dangling a Yeti cooler out there for the winner, everybody wants the Yeti cooler, right? That's what everybody's driving for. So it's just, in business, you've got to think, Even though it may be your drive is money, you really got to get a pulse on your employees and figure out, hey, they may want a day off work instead of cash, you know, or they may want to go have these experiences together. But what happens is it starts to build a culture of people who like to have fun, but also people who hold each other accountable because they know, because it's clear to them, they know that all this wouldn't happen without the success of S&D Plumbing making money. And as soon as anything happens with that, you know, we're not going to be able to go have all these fun events and stuff like that. So they work hard to play hard around here. Good time.

Yeah, that's cool. How do you do that?

How do I do that? I guess so.

So if I can hold that for one second, because I do want to hear your answer, but I just want to— just want to kind of want to process what's going through my head. First off, you got to be fun. Yeah, because I was thinking about myself. I don't know. I don't think I'm that much fun.

You got to think about that.

Then you got to think about, well, do I even want to hang out with all of these people? There are some— there are some situations where I've heard this before. I think I've heard this a couple times at your QSC events, is like where the wife doesn't want to have anything to do with the people at the office. I don't know if your wife is involved in the business or not, but obviously she's— she must be okay with hanging out with everybody at the office. How do you overcome that kind of stuff? How do you— how do you—

how do you do that? Well, first of all, my wife's not involved in the business and she never would want to be, and I wouldn't want her to be.

I don't know how How that can work, but she'll go party with all of your people.

She will. Yeah, she will. You know, to answer your question, I mean, I consider all my employees friends to a certain extent. I'm truly friends. I truly love my employees and I'm really passionate about making them successful. And so that's, that's what really drives me. And then, you know, we go out and have a good time, but that's besides that. I don't see them after hours of work, you know, I don't call and hang out with them because we still have that professional owner-employee type, or just like if you had a manager or leader in your company, there's got to be that professional separation. Some people you're never going to get along with. I mean, it's really— they're there for a great purpose in your company, but you're not going to say, well, I want to go hang out with them every day. But, you know, we go and have these events. I think it's just a matter of everybody getting along and having a good time.

Well, and also, I really like what you said about everybody understands that the only way the fishing trip happens, the only way that the Fourth of July party happens, the only way that the culture happens is if S&D is financially successful and financially sound. How everyone is aware of that and working towards that.

Yeah, otherwise I wouldn't— I couldn't afford to do any of it.

That's right, that's right. And I think that it's important that people understand that when we are— we're in business, in order to develop this stuff, in order to develop the team, in order to deliver a world-class customer experience, you've got to be profitable. You've got to make money. I've been talking more about this, and that's another topic for another day, but I've been talking a lot with people about profit, and it amazes me how many business owners either don't completely understand profit or just don't understand how to make a profit. They're good at creating jobs for themselves, but creating a business that then generates a profit is a whole nother story. And I know with you guys it's important.

Yeah, it is very important. I don't want to— you know, I've been going off or going on and on about these cool things we do, and I don't want to— I want to let you know that this started with one fish— this started with one event. You know, it started with, hey, let's try this out and see how it works. And this has been a graduation of 5 or 6 years of things that we figured out really drive our employees. So you can package this up as a benefits package for the people that like to come work at S&D Plumbing, because that's what it is. And granted, not everybody likes to go fishing, but you know, everybody likes to to hang out and all that stuff. And so we try to touch a little bit, you know, we go to a baseball game, we do this, we do that. But even, even as a business owner, you got to think about your, your office staff too. I mean, a lot of times in the service business, like a plumbing, HVAC, electrical, you're all about your technicians. So you're training your technicians, you're giving all these great tips and bonuses, and you forget about your office staff. And cool little things you can do for your office staff is like have somebody come in and wash their cars once a week, or have somebody come in once a month and do massages for them, or something like that, to really separate yourself from the, you know, from everybody else. So really, it's a place that nobody else does that, right? I mean, you don't really hear about those kind of things, and it really makes it a great place to work. And then before you know it, you have people knocking on your door wanting to come work for you. And pretty neat, pretty neat deal that we're doing here.

Well, and that's kind of the But that's kind of one of the biggest indicators, I guess, of success. And really one of the biggest benefits of doing all that you're doing is that you have 300 resumes to go pull from. When you need staff, you are not as, you know, crazy as most people are looking for new people because people actually know about you and they want to come and work for you.

You say that too, but one thing I've realized I mean, you never stop learning. You never stop recruiting. You gotta always be recruiting. Cause I even get slapped in the face sometimes. You're content. I'm content with my marketing manager. And I, you know, she's getting the next thing I know, she's getting ready to come back from baby leave. She walks in my door and says, yeah, we're going to start our own company. So I'm leaving, you know, and I'm thinking that's a position I don't recruit for, you know, so things, life happens to people. So it makes me realize that whether I have, I'm content with my employer and happy with my employer or not, I consistently have to be. Accepting resumes and interviewing and just trying to find the right fit. It also drives a great competition too in the company. You know, people start to realize where that bar's set. I can't say that enough. You really never can stop recruiting for your company.

Yeah, no, that's, that's great advice. So we are— wow, we flew through this episode and we didn't even touch on world-class customer experience, which I know you guys deliver. Can I invite you back for another episode in the future where we talk about the world-class customer experience at S&D Plumbing?

I would love to, yeah, come back for sure.

I think that would be a great topic just in and of itself because I know you guys do things a little bit different, and I think it would be a great conversation to have.

Great, that sounds good.

All right, so that's it for today's episode of the Wealthy Contractor. Contractor Podcast. Let me ask you, did it help you look at your business in a new way? Did it spark an idea or ideas you hadn't thought of before? Do you have a list of action items that you can take and implement into your business or your life today? I really hope so. Now, before you go, make sure you subscribe to the Wealthy Contractor Podcast so you get access to the latest episodes as soon as they're available. We're always striving to provide you with great content, so you don't want to miss what's coming up. And a favor, I'd really appreciate it if you'd go to iTunes and post a review of this podcast. Let us know how we're doing. And finally, we started The Wealthy Contractor as a resource to help you, the home improvement entrepreneur, regardless of where you are on the wealthy scale. Get where you want to go. We want to provide you with the motivation, the confidence, the resources, and the tools so you too can live the life of the wealthy contractor. Now, the wealthy contractor is a place where it's okay for you to want it all. In fact, it's not only okay, it's encouraged. So until next time, this is Brian Kaskavalciyan with G4 Marketing Group.