BONUS CHAPTER SEVEN – For the Contractors; Profit is NOT a Dirty Word

So far the entire book has really focused on saving money for local agencies, and that is really where the biggest bang is going to happen for the planet.  However, contractors struggling to make a living can also take full advantage of the Three Legged Stool™ System that I have developed, let me give you an example below:

Case Study:  Atlanta Technical College, GA During the letting of this project the owner was not able to accept alternate methods of rehabilitation due to time constraints on the bid, and scheduling of the work.  At this same time, prices for liquid asphalt cement had sky rocketed and conventional rehabilitation was very expensive.  We went ahead and bid this project as a conventional undercut along with some thin overlays for the parking lots.  Our final prices was about 900 K or so to do the work, with half of the price for the contract being for the dig out of the main bus route. I knew that time was of the essence because the off-season for the college semester was a short one.  You could say that I rolled the dice a bit, but we bid the job straight up as it was let, with the intent of proposing a change order to do Full Depth Reclamation in lieu of the conventional undercut.

Experience had shown us that we could do this work for substantially less money in a tenth of the amount of time.  We also knew that the owner would likely be enticed by the fact we could complete the project ahead of schedule. So in a time when our competition was literally beating themselves up with little or no profit margin, we secured the work, and successfully switched the project to the scope that we knew would make us the most amount of profit, while providing the most value for the customer. Bottom line here is, as a contractor it is ok to make profit, which is not a dirty word by the way.  Provided you can give value to your customer.  In this particular example, we also gave the Atlanta Technical College President a check back for $25,000.00.  She in turn, requested that we do an additional parking lot resurfacing project for her and used that credit up.  She said to me during the punch list of the project, “Blair, I have been doing this job for 25 years and you are the first contractor that has ever given me money back!” To this day, this is one of my favorite case studies as it exemplifies how business is supposed to work.  As a business owner, you provide solutions for your customer, they get value at a reasonable price, and you make a reasonable amount of profit in return for providing that service.
So if you are sitting on the fence deciding whether or not this pavement management, in-place recycling, or pavement preservation thing is for you, think about this little story and how it could affect your bottom line back at your office.  We did this work in harsh economic times, but made more profit in one month than most small business firms made in an entire year in that season. Below are some of the photos and facts from the project.  If you are a consultant, contractor or service provider and wish to discuss how to grow your business with anything that was covered in this book, please email me at blair@thebarnhardtgroup.com to discuss in detail.

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Atlanta Technical College-Marta Bus Route-Before FDR

Comparison of Conventional vs. FDR Method $$$ Conventional VS FDR Construction Conventional Section •3 weeks to construct •Re route Marta Bus Traffic •6,737 tons of surplus •3,850 tons of virgin aggregate •2,887 tons of HMA •$336,000.00 •If sub base problems occurred, change orders FDR Section •1 week to construct •Two phases to minimize detour routing inconvenience •No virgin aggregate used in base •Original design was foam, done with Portland cement •Left the College and DTAE with more funds to do more work while we were there

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Before FDR and HMA Inlay

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19 mm Binder Going Down on FDR w/Cement

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Final Wearing Course, Speed Table, Striping Complete

If you are in the contracting business and haven’t been involved with an in-place recycling project in some way, you may want to consider doing so in the near future.  There are plenty of ways to provide value to your customers while making a very good profit margin, with little risk of failure or warranty work.

Our warmest thanks to all of those loyal clients who have attended our workshops, purchased our books, DVDs, audio CDs, listened to our podcast, watched our training videos, gone through the  IPMA Academy Accredited Pavement Manager Certification Program, and most importantly hired our firm to help them save millions!
Sincerely,


Blair Barnhardt, APM
The International Pavement Management Association

Author of the Amazon #1 Best Seller,
‘The Book on Better Roads’

GO FOR IT! #infrastructure

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