Power of group purchasing: Cardinal Crest’s co-founders talk CBUSA benefits
Today on “The Building Code,” Zach and Charley are sitting down with returning guests, Joe Christensen and Adam Shaeffer, co-founders of Cardinal Crest Homes in Kansas City, Missouri. They offer their clients a unique and memorable custom home building experience with in-house architectural services and step-by-step interior design consulting.
Tune in to the full episode to hear from Joe and Adam about their experience with starting a CBUSA chapter in Kansas City and get their perspective on how group purchasing will positively affect their market.
What has been your experience as a CBUSA member so far?
Joe: “One thing that’s been really great as it’s been kicked off here in Kansas City is that you see a great collaboration between competitors. Not, obviously, in any type of price fixing, but in a way of just sharing information on a sense of what subs are being used, what suppliers, what strategies you have. I think breaking down barriers to just friendships as well. It can be a dog-eat-dog world in construction and a lot of big personalities and the buyer group itself has kind of, I think, opened the doors to more collaboration within competitors, which I think is a good thing.”
Adam: “CBUSA for me and the way that I see it, and it’s still relatively new in our market, but it is like a mini Builder 20 group in a sense that builders are collaborating within your market, and you’re sharing little secrets about your market. And the whole point of it is to improve as builders and improve our bottom line, so we can all grow and benefit from it.”
How has CBUSA helped facilitate conversations and helped builders see the benefits of working with competitors to reach a common goal?
Joe: “So, as we’re now starting the CBUSA chapter here in Kansas City, everyone has to have a buy-in and say, ‘Yes, you will share the subs that you use, and we’ll fit them out with the application process. And yes, you will share the pricing that you get from them because we want to do it as a group.’ It’s just getting to those awkward conversations that are sometimes really hard to do. It’s a group that facilitates those awkward conversations around purchasing power, supply, suppliers and labor and now, we have a purpose behind it. Having this one organization that facilitates that has helped a lot.”
Adam: “And luckily, our regional manager, Johnny, he’s incredible. He facilitates the conversation. And so, I feel like the more that the builders in those markets rely on CBUSA, participate in the questionnaires that are sent out, participate in the conversations, and most importantly, just show up to the meetings, you’ll start to realize that there’s a huge benefit to being a part of this group.”
Links and more
Learn more about Cardinal Crest Homes on their website.
Interested in joining a current CBUSA chapter? Send us an inquiry.
Want to start a new CBUSA chapter in your area? Head to our website to learn how.
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Zach Wojtowicz:
What’s up everybody? Welcome to “The Building Code.” I’m Zach Wojtowicz.
Charley Burtwistle:
And I’m Charley Burtwistle.
Zach Wojtowicz:
Here again with my good friend Charley, long reunited. We’ve been intermixed here, but for me in the recording studio, it’s been a minute since I’ve seen you.
Charley Burtwistle:
It has been a minute unfortunately, but it feels fantastic to be back. It’s kind of a gloomy day here in Omaha, Nebraska, so coming into this brightly lit beautiful studio with all my best friends in one spot is a fantastic kind of refresher.
Zach Wojtowicz:
Well, your skin tone, looking fantastic for those of you that don’t see us on YouTube. You want to see what we look like in our pasty winter skin coming into the summer …
Charley Burtwistle:
I was going to say.
Zach Wojtowicz:
Sunshine of Nebraska Spring? Let me tell you, it’s a sight to behold. Charley’s holding it down.
Charley Burtwistle:
I think you’re being facetious because I was looking at myself on camera, and I’m like, “That is one pale person.”
Zach Wojtowicz:
I would never be facetious.
Charley Burtwistle:
Yeah. That’s just like who you are as a person. Well Zach …
Zach Wojtowicz:
Allegedly.
Charley Burtwistle:
Enough about you and your facetious nature. Who do we have today?
Zach Wojtowicz:
Yeah. We got Joe and Adam from Cardinal Crest Construction down in Kansas City, real close, design build firm. They’re both incredible people, incredible builders, credible business people. I’ve actually gotten to spend a lot of time with them over the past few months, and I joke with some of our other contractor friends where I’m starstruck. There are a few handful of folks that, when I get in a room with them, I’m kind of like, “All right, be cool. I want them to like me.” It’s like I have to sell. We’ll see where the episode goes, but they’re both amazing.
Charley Burtwistle:
Yeah. Absolutely. Definitely. Kind of the starstruck in nature, getting ready to …
Zach Wojtowicz:
I hate to say it out loud, but a little bit.
Charley Burtwistle:
I am. Yeah. Absolutely.
Zach Wojtowicz:
Yeah. Well, and what are we talking about today, Charles?
Charley Burtwistle:
Today we are going to be talking about CBUSA. They just recently helped start a chapter of CBUSA in the Kansas City market. So, going to talk about some of the nascent benefits they’ve seen from that and how other builders can benefit as well.
Zach Wojtowicz:
I love it. I love it. Well let’s get the two bad boys in here and let’s start talking a little about CBUSA.
Charley Burtwistle:
Let’s do it.
Zach Wojtowicz:
Joe. Adam, welcome back to “The Building Code.” You’re great friends of the podcast and of course Buildertrend. How are we doing?
Joe Christensen:
Great. Fabulous.
Charley Burtwistle:
Enthusiastic.
Adam Shaeffer:
It’s a beautiful day in Kansas City. A little wet, but other than that, we’re doing amazing.
Charley Burtwistle:
Love that. And about to get even better for the next half hour or so. This is my favorite part of the day obviously. You guys have been on “The Building Code” before. Obviously, Cardinal Crest does a lot of promotional content and stuff like that so, hopefully, everyone listening is well aware of who you are, but for those that are just learning about you for the first time today, I would love if you could just share a little bit about yourself, your roles, and obviously, the company Cardinal Crest.
Joe Christensen:
Take it away, Adam. You go first.
Adam Shaeffer:
Oh gosh. So, Joe and I, we’re the founding fathers of Cardinal Crest and the worldwide headquarters is located in Kansas City, Missouri. We started this company about 13 years ago. In the beginning it was just Joe and I for the first five, maybe three, four years, and then we started to hire at around year five. And since then, we have grown the company. We’ve started a commercial arm, and we’ve started a property management arm and a development arm, which is awesome. On the home side, we’ve built around 150 homes since our beginning. It’s been great.
Joe Christensen:
Since four scores ago.
Adam Shaeffer:
Yes.
Zach Wojtowicz:
Little historical theme here on “The Building Code” today.
Joe Christensen:
Yeah. As founding fathers, I just envision like a little flute player.
Adam Shaeffer:
Yeah.
Zach Wojtowicz:
Yeah, yeah, yeah. Cue the fiddle. Yeah. Should we lean into it in the intro of the song? It’s like we just go full 1776. Or you go Declaration …
Joe Christensen:
Definitely. Definitely.
Zach Wojtowicz:
Or the Star Spangled Banner, not the Declaration of Independence. Different …
Joe Christensen:
I hope this comes out around July fourth. John could cue in some …
Adam Shaeffer:
Oh, that would be better, yeah.
Joe Christensen:
Some patriotic music and we could, yeah.
Zach Wojtowicz:
You know what? God bless him …
Joe Christensen:
That was great intro.
Zach Wojtowicz:
On The Building Code today.
Charley Burtwistle:
Well, if you’re listening to this and it is …
Joe Christensen:
“The Building Code.”
Charley Burtwistle:
If you guys are listening to this, and it is July 4th, then this plan has come to fruition. If you’re listening to this and it’s not July 4th …
Zach Wojtowicz:
Totally intentional.
Charley Burtwistle:
That we failed in our kind of ad hoc pitch here. But thank you guys for the intro and excited to dive in a bit. Topic for today, we’re going to talk about CBUSA this time. Obviously you guys have shared some great information before. That’s kind of the topic we want to dive into today. How did you first discover CBUSA and maybe why were you looking to join a group purchasing network?
Joe Christensen:
Yeah. I’ll take that. I had heard of different purchasing groups before, and there’s one that’s in Kansas City that I can’t remember the name of it to tell you truth right now, but there’s a smaller one that some people had membership of, and we weren’t. Then truthfully, Brad Leavitt was a great cheerleader of CBUSA, and I was with him, I think it was in one of our Builder 20 group meetings, and he was talking about all the benefits that he has seen through CBUSA. So, I was, was it, not in 2024, 2023 I was at the IBS Builder Show in Vegas, and I went up and talked to one of the CBUSA guys and was like, “Hey. Interested. I don’t believe we have a chapter from Kansas City,” and he was like, “Oh yeah. You guys are on our list. We’ve got to get together and kind of put in the right components, right people.” And one day one of the guys called me, I can’t remember these names, I’m sorry, but he’s like, “Let’s do it. I’m really excited. I’ve researched some builders. Why don’t you give me a list of builders that you would recommend that would really want to be a part of this?” And we kind of just talked through the most active HBA members first and then their team just went to town and contacting everybody. So, that chapter is newly formed right now in Kansas City, but anyway. After researching just more and more and hearing word of mouth and just a buyer group, “What does that mean? What are the rebates? What are the advantages of it?” We just thought it was something that would really benefit us.
Zach Wojtowicz:
One of the things that is interesting with you two in particular with CBUSA is you’re pretty active with your Builder 20 group as well. So, in your conversations around how you are running your business, how you’re growing community within the building industry, is that another avenue that you’re wanting to bring to other people that you’re connected with or is this something that came to you? One of the things we joke about at Buildertrend is we acquired CBUSA through CoConstruct and then we just were like, “What’s a CBUSA thing?” We were a little bit unaware of what was happening with this organization. What has been your experience with these group purchasing organizations and your other groups that you are a part of is what I’m asking? That was a long, drawn-out question.
Joe Christensen:
But I like it. It’s a great question. Couple in one. So, it’s a compounding question.
Zach Wojtowicz:
Yeah. You think I did better at this over time? No.
Joe Christensen:
Yeah.
Zach Wojtowicz:
No.
Joe Christensen:
No.
Adam Shaeffer:
Maybe we should have done some research.
Zach Wojtowicz:
Yeah.
Joe Christensen:
Well here, I’ll speak to this. All right. Sorry, Adam. I think in the Builder 20 group, there are members who are part of CBUSA and then part of their own buyers group. The Builder 20 group is really great just because there’s a lot of honesty that comes about to understanding how people deal with other suppliers and subs. And the only thing I’ll say, and I’ll let Adam fill in the rest, but one thing that, and I’m not sure this answers your question completely, but one thing that’s been really great as it’s been kicked off here in Kansas City, the CBUSA buying group is that you see a great collaboration between competitors, not, obviously, in any type of price fixing, but in a way of just sharing information on a sense of what subs are being used, what suppliers, what strategies you have, and just I think breaking down a little bit of barriers to just friendships as well, where sometimes competitors can be hard.
It can be a dog-eat-dog world in construction and a lot of big personalities and the buyer group itself has kind of I think opened the doors to more collaboration within competitors, which I think is a good thing.
Adam Shaeffer:
Yeah. I agree with what Joe is saying. When Joe and I, honestly, I wasn’t necessarily looking for a buying group to be a part of. Rewind three, four, five, six years ago, Joe and I, we were actively trying to connect with a Builder 20 group. We wanted to be a part of a Builder 20 group. And luckily we landed with an amazing group, ACBC, go Hammers. It’s been an incredible group that has completely changed the way that we do business and our outlook on business. It’s been incredibly beneficial and for those of you who don’t know what a Builder 20 group is, it’s a group of 20 like-minded builders in non-competing markets, and you share everything.
You share your business secrets, your financials, everything with the intent that you as a group will become better builders. So, now we’re in this Builder 20 group. We heard about CBUSA. CBUSA for me and the way that I see it, and it’s still relatively new in our market, but it is like a mini Builder 20 group in a sense where builders are collaborating within your market and you are sharing little secrets about your market. And the whole point of it is to improve as builders and improve our bottom line so that we can all grow and benefit from it.
Charley Burtwistle:
Yeah. It’s funny, every time we have someone on here to talk about CBUSA, obviously, the headline items are rebates and group purchasing power and partnerships with national suppliers, but the thing that everyone talks about when we ask them about, that it isn’t necessarily those things. It’s the networking effect and the ability to learn from other like-minded builders and obviously, you guys are leading from the front from a community aspect with all the different organizations that you’re part of, but it’s a great way for contractors to get out there and start talking to their like-minded individuals that are trying to achieve the same thing and have the same goals, and I know the application process to get into CBUSA is pretty strict to make sure that it’s just kind of the best of the best that are operating and learning from that. So, it’s interesting to hear your guys’ perspective from a brand new chapter that’s just getting started is very, very similar to a lot of the other builders that we’ve talked about before.
Joe Christensen:
Oh yeah. I mean, we’ve heard and seen that because I think when builders can be reluctant to share, right because it’s their competitive advantage sometimes and even reluctant to share certain subcontractors or suppliers because if everyone knows about this great subcontractor, well then everyone will be using them and maybe he’ll raise his prices and all this. And so, in the past, I’ve totally been on that side of trying to ask a builder that I know about a sub and frankly, they just said no or wouldn’t share. So, as we’re now starting the CBUSA chapter here in Kansas City, everyone has to have a buy-in and say, “Yes, you will share the subs that you use, and we’ll fit them out with the application process. And yes, you will share the pricing that you get from them because we want to do it as a group,” which will be beneficial for the subcontractor as well.
It’s a two-way street here and so, it’s not all just about builders getting their best price, but it’s just getting kind of awkward conversations that are sometimes really hard to do, it’s a group that facilitates those awkward, hard conversations around purchasing power, supply, breaking up some of these turnkey subcontractors, the suppliers and labor and now, we have a purpose behind it where sometimes individually, yeah you could try to do that or one or two one-off builders can try to do that, but having this one organization that kind of facilitates that has helped a lot.
Adam Shaeffer:
I think we might have a unique perspective on this, and there’s lots of builders that share this perspective because we are just starting out. CBUSA is just starting out in Kansas City. It’s a brand new chapter. And so there is, when you’re sitting and you’re participating in these meetings, you’re looking around and there’s 15 of your competitors in there and there’s an immense amount of hesitation when these first questions are asked and everyone’s like, “Should I say that?”
Zach Wojtowicz:
It’s like the first day of school.
Adam Shaeffer:
Totally. And luckily …
Joe Christensen:
That first day of school. I like that.
Adam Shaeffer:
Totally. And luckily our director of ops, I believe that’s what his official title is, Johnny, he’s incredible. He facilitates the conversation. And so I feel like the more that the builders in those markets rely on CBUSA, participate in the questionnaires that are sent out, participate in the conversations, and most importantly just show up to the meetings, you will start to realize that there’s a huge benefit to be a part of this group. I think maybe later on in the conversation, we should touch back on subcontractors and how they could potentially feel about this because I’m sure a lot of subcontractors listen to this podcast, but we could probably dive into that. I don’t know how focused we want to be on CBUSA here, but.
Zach Wojtowicz:
Despite the shock and awe of our production, there are no real rules. You take us where you want to go, but before I did have a thought. So, it’s …
Charley Burtwistle:
Let’s hear this thought, Zach.
Zach Wojtowicz:
Yeah. It’s so profound. It’s a question that’s probably too long. I’m just letting you know.
Charley Burtwistle:
So, strap in. Yeah.
Zach Wojtowicz:
Maybe go get some hydration …
Charley Burtwistle:
Sip of water.
Zach Wojtowicz:
If you need it. Yeah.
Charley Burtwistle:
I’ll condense it down once he’s done to …
Zach Wojtowicz:
Yeah, yeah. That’s why we need two hosts. It’s like, “Okay, he just talks too much and Charley actually asks the real substance question.” Just ask everybody that knows me. I am curious though, have you met any new builders from it that you were aware of, but never maybe made the connection or have you started to have any of those exchanging of the actual, it’s like there’s business relationships, but there’s things that are different. At CBUSA, could you see that being something happening because of this as well? Or did you know everybody in the room? I guess it’s like what’s that been like?
Adam Shaeffer:
I’m sure Joe knew a lot of the members in the group because Joe’s very, very active in our HBA, our local chapter. For me, I was aware of the majority of the builders in the group. I had personally not met, officially, a couple of them. So, it did open up that avenue for networking where I was able to meet these people, see how they interact with other people, and then also just understand, they’re just like me. We’re just trying. We’re all trying to do our best to provide an exceptional product for our clients and hopefully make some money doing so.
Joe Christensen:
We had a perfect storm happen where, before CBUSA came into the market, the HBA, myself, and another builder started hosting these builder council meetings, and they were every other month, actually they were monthly at one point and then every other month, and they were like mini Builder 20 sessions where the idea was builders only, principles of businesses only, so owners of companies, and we were getting together and at first all we talked about was NAHB performance standards of financial reporting and how do we get to a point where we can benchmark ourselves with the NAHB financial reporting standards because the NAHB comes out with a report that says, “Semi custom builders or custom builders or production builders report this gross margin and this amount of commissions, this percentage of framing,” and all this different things. They do a really good study. And so, we had six weeks of just talking about that and it was really same deal.
The first two meetings were very just me and this other builder presenting, just talking a lot and trying to get information from people. And then it started opening up, and people started seeing the real value of sharing and getting into the weeds of each other’s businesses. So, I felt like that was a good trailblazing kind of before to then people seeing like, “Oh my gosh. There’s a real benefit of sharing openly.” And it’s not like just because I share this one little tidbit about my business that I’ve learned, all of the sudden that one builder is going to completely dominate the industry. So, I think that was a good opening to then CBUSA to just share a little bit more and collaborate with other people.
Charley Burtwistle:
Yeah. Laying the groundwork there. I could see how that could be instrumental to alleviating some of that initial hesitancy. I am curious, back to your point, Adam, before Zach completely changed the script there of just your kind of thoughts on, of course that was a great question, Zach, and other than the two-minute intro to your question is pretty succinct.
Zach Wojtowicz:
You’re doing it right now. This is so meta. You’re giving context of the context about the context.
Charley Burtwistle:
Yeah. Yeah. We’re off the rails here, but just the subcontractor point of view, I’d be really interested in your thoughts there, Adam, because obviously a ton of benefits there outside of just the initial builders.
Zach Wojtowicz:
And something we’ve never really talked about with CBUSA, so I would love that perspective.
Adam Shaeffer:
Yeah. So …
Joe Christensen:
Buckle up. Buckle up. Going to get spicy.
Adam Shaeffer:
Hold on. Let me introduce my answer with a, no. I’ll just go straight to it. Let’s go straight to it.
Zach Wojtowicz:
Is it missed anybody, too?
Joe Christensen:
30 seconds to introduce the answer.
Zach Wojtowicz:
We made a joke about CBUSA and then went on this trailblazing of Americana and then came back and then it hit me like USA is in the topic of the …
Charley Burtwistle:
Oh, wow. Great call.
Adam Shaeffer:
Yeah. Please, please make an intro of just some patriotic music, little flute playing with this one.
Zach Wojtowicz:
We have confirmed that this is coming out the weekend before the 4th of July as well. So, we are perfect.
Adam Shaeffer:
Perfect, perfect.
Zach Wojtowicz:
We have teased this question enough though, Adam. Let’s get to it.
Adam Shaeffer:
So …
Joe Christensen:
Ready, set, roll.
Adam Shaeffer:
Oh, man. Where to start? So, basically think of this, some of the meetings are we, Joe and I, we’re in a market where our drywaller, he supplies the material and the labor. We’re in a market where our roofers supply material and labor. Kind of all these little turnkey packages. We’re in a market where the majority of our tile selection houses also supply labor and materials are hardwood flooring, labor and materials. So, as a subcontractor that is signing up, I think there is a lot of hesitancy in a sense because what Builder 20 does, or sorry, what CBUSA does, is they challenge, or they want that relationship from a subcontractor to a builder, they want transparency within the relationship. Now, I look at my perspective. For the last one to three years, as a builder, we have had to figure out a way to be completely transparent with our homeowners.
There has been a time that we have never felt before where we had to share everything just to create an enjoyable, somewhat enjoyable, experience for our homeowners. As pricing has just gone out of control, the only way to do it is to be as transparent as possible, and that’s the only way to salvage relationships with our buyers, with our owners, our clients. And so, I feel like for the last three years we’ve been having to defend ourselves constantly and the best way to do that is to be transparent. Now, where we are today, we as builders, we need to develop a transparent relationship with our trades, with our subcontractors. And what CBUSA does is it helps those barriers or it challenges that transparency in a sense where, first and foremost what we’re starting with in our market is drywall. We’re going to buy our drywall material directly from the supplier and our drywall subcontractor, he’s just going to provide the material, sorry, provide the labor to install that material.
Now, a trade might think, “Well I’m making a markup on that material and so this is going to hurt my bottom line.” I don’t feel that that’s true in the CBUSA group. What we’re finding out is it’s actually difficult in our market to find a drywall guy that will actually separate the material and labor. So, those one or two guys that do commit and do separate, they’re going to get all the business of those 20 builders that are in that group. And I think there’s a ton of benefit for that. We’re not asking the drywall guy to remove his time and energy spent in providing a takeoff for the home. We want them to include that in their cost to us. We just want to separate the material from the labor, and we want to start to challenge those relationships throughout all the line items in our cost codes, really. But the idea is develop a transparent relationship with the trades. If we can do that, then there’s trust there and then all that that leads to is a long-lasting relationship and those guys, those subcontractors, will continue to get work from us.
Zach Wojtowicz:
That’s amazing. It makes a lot of sense. I have seen this play out a time or two with different builders that change definitely is more about education than it is about the underlying problem. It’s like, “This is why we’re doing this. This is the benefits you’re going to get, the benefits I’m going to get.” And I think that withholding the benefits I get is where people start to fill in the gaps. They’re like, “Well he must be getting something above if you’re not willing to share those things.” And this just kind of facilitates that relationship, and I love seeing contractors help bring up the whole market. So, it starts here, but this will be the beginning of something much bigger that, ultimately, could shift the way that the Kansas City market works, which is really, really impactful and cool and something that CBUSA helps be a part of. So, really interesting though. We’ve not heard that perspective from other CBUSA members on the podcast.
Charley Burtwistle:
Let’s just say. We’ve definitely talked a ton about the pricing transparency to the homeowner, but everything here just makes sense on the subcontractor side. Follows in the same vein as Zach was talking about.
Joe Christensen:
I mean, we have a lot of subcontractors that are what we call turnkey like Adam has discussed that the labor and supply is one number, and they don’t break that out. And there is, and there will continue to be, feathers a little ruffled because we’re, ultimately, taking down their, if their number, let’s just say drywall, if it’s $50,000 and $30,000 of that is actually supply, I’m just throwing these numbers out here, it then takes down their number, and ultimately, that what they’re marking up and what they’re making, I think that will level off over time. At first, we’re kind of in the shock phase of like, “No. I don’t want to do that. I’m going to make less money,” and I think they’ll figure it out to make. But what I think it’s really important is that it puts the purchasing power back into the hands of the people who are actually purchasing.
Ultimately the builder is the one who’s purchasing this product and that we are choosing the supplier we’re purchasing from. Before there’s kind of these gatekeepers that are set up. And I think that’s really disruptive in a good way, and we’ve seen that play out in the last 50 years. I mean, that’s what the internet has done so well is that, and smartphones and everything else, all the technology, is that it’s disrupted gatekeepers in a way that there’s more transparency, and ultimately, it does make it more efficient in pricing, more efficient in ordering, more efficient in quality, all those things kind of get leveled out.
At first anytime there’s a disruption like that, and you’re taking down some gatekeepers, people get upset, and that’s what’s happening and it’s going to happen, but it does level off and again, I think it’s important. We’re a design build firm so we’re drawing our own plans for the most part, not all of them, but for the most part we’re drawing plans and speccing things, and there’s a lot of builders like that that the purchasing power should be with us, that we choose a supplier, that we choose what products we want in there and I think it’s a little backwards in it when the subcontractors doing that and truthfully, it puts a lot of liability on them when they have to choose the supplier as well. So, there’s some benefits all around and it will level off, but for sure there’s some heated feelings about it and there’s some subs who are pretty upset about it, and I think nervous, which they shouldn’t be.
At the end, we understand, everyone’s got to make money. You’ve got your margin that you’ve got to make. That will all level out. But I think it’s important to have these kind of barriers knocked down and the purchasing control should be within the businesses who are actually initiating the purchase.
Zach Wojtowicz:
Yeah. I think for me, the interesting whole perspective on it is, you brought up the risk, and I can only imagine in some ways you will end up making them maybe more efficient to be able to do more jobs because they’re not having to go through logistical process of getting the material on site. But I totally understand your perspective as well where it’s like, “Look, we have this very deep relationship with customers. We’re working with them for two years probably between pre-construction and delivery in some cases.” You’re delivering the final product. The drywaller in this example is kind of one piece of a much bigger puzzle that you have to kind of have that perspective to actually deliver the product that that customer is expecting to buy right down to every detail.
Really, really interesting stuff. We’re a little bit up against time, so I just want one last question kind of about, it’s not just subcontractors that can be resistant to change. What about within your market, the people who are like, “Oh, you’re in CBUSA. I don’t know. It’s not for me.” What do we say to those individuals? What’s the value prop of people who do listen to this and like, “Yeah, I just don’t think I want to do that.” What would you say to them?
Adam Shaeffer:
I’d say to wake up. The …
Joe Christensen:
Get with it.
Zach Wojtowicz:
Clip in that.
Adam Shaeffer:
Yeah.
Zach Wojtowicz:
Wake up.
Adam Shaeffer:
Yeah. Within our group here in our market, there are productions, semi-production, semi-custom builders, full custom builders that make up this CBUSA group. And you can question, “Well I’m a custom home builder. My business is different than the production builder.” So, there are benefits on all levels. For the production builders or semi-production builders, being a part of CBUSA, it’s an easy, and I say easy, let me take that back. That’s a loose word there, but it is an easy way, I’m going to say it again, it’s an easy way …
Joe Christensen:
Loose and fast. What’s your deal, dude?
Adam Shaeffer:
For those builders to increase their margins, one, maybe even 2% on their fixed prices, just being a part of CBUSA. For the custom builders where we’re like, “Well we don’t want to lower our prices. If we lower our prices, then that would lower our margin.” But you got to back away from that thought and think, “This makes me more competitive,” because a lot of the subcontractors that are part of CBUSA, they give you better pricing than other builders. And so, that is going to lower our overall cost of the project, but we do benefit on the rebates. And the numbers that I’ve kind of looked into, if I had $10 million in sales revenue, what I see is it’s going to put anywhere from $30 to $60,000 back into my account at the end of the year through rebates.
And that right there, that alone, that could help pay for benefits, for a builder to want to provide benefits for their employees or a new truck for the year, whatever it is. That’s a huge benefit for those custom. Then there’s those assholes that are custom home builders that don’t have to compete. So, maybe you’re just so good at what you do, so it doesn’t matter what the price is, you still get a benefit on the rebate, which is fantastic. But I do see it helping and benefiting every tier of those individuals that are in the home building realm.
Joe Christensen:
And subcontractors benefit, too.
Adam Shaeffer:
Totally.
Joe Christensen:
They get these purchasing agreements from a group of builders, and they’re large, and they also can plan ahead. It’s really beneficial for subs when they buy in because now they’re going to say, “Okay. I’m going to get so much work this year, and I could plan on that,” and they could staff up for that. And then on the other side, I think, for builders all around, I think at first it’s, not discouraging, but it might think like you’re giving away trade secrets, but ultimately, just like Adam said, it could help across the board.
Zach Wojtowicz:
Amazing. Well, Joe, Adam, it’s always a pleasure to have you here on “The Building Code” or on the street. You may be starting your own podcast as well. Would you like to plug it now?
Joe Christensen:
Word on the street? No. I don’t think we have a name for it or anything yet, but …
Adam Shaeffer:
It’s coming soon.
Joe Christensen:
Coming. It’s coming soon. But you know what? You guys will be the first to know. I will tell you …
Zach Wojtowicz:
That’s right.
Charley Burtwistle:
We will have the scoop.
Zach Wojtowicz:
This was my way of trying to get an invite to check out the studio, so I just thought I’d …
Joe Christensen:
Yeah. You’ll have the scoop.
Zach Wojtowicz:
That’s right.
Charley Burtwistle:
Yeah.
Zach Wojtowicz:
That’s right.
Charley Burtwistle:
Can’t wait to break that news. That’ll be huge.
Zach Wojtowicz:
Yeah.
Charley Burtwistle:
Thank you guys so much for coming on today. Always an absolute pleasure, and you’ve secured your next guest spot on the podcast when you start yours, and we can promo it then. Appreciate the time, guys.
Joe Christensen:
Love it.
Adam Shaeffer:
Sweet dude.
Joe Christensen:
Yeah. Thank you guys.
Adam Shaeffer:
Thanks guys.
Zach Wojtowicz:
Just had Joe and Adam from Cardinal Crest, talking all things CBUSA, talking all things America, talking all things Kansas City, subs, vendors, we hit a lot of great topics today, and it was a lot of fun to have them on. They always deliver in terms of their humility and also their humor, and I just love talking to them and even talking about the meta, the way I ask questions.
Charley Burtwistle:
Yeah. Yeah.
Zach Wojtowicz:
Good times.
Charley Burtwistle:
Great times, great banter.
Zach Wojtowicz:
Yeah.
Charley Burtwistle:
Of course. Great content.
Zach Wojtowicz:
Yes. We just love to bring it to you. Charley, what were your takeaways, man?
Charley Burtwistle:
I think it was a really beneficial episode. I know the focus was meant to be CBUSA, but even getting outside of that specific avenue of just talking about you use the buzzword networking a lot, what does that really mean? Or community and I think those two are really leading from the front on what you should be doing if you want to become a better builder, or any honestly vertical, if you want to get better at what you do, you need to talk to other people that are doing the same thing. And being able to go into that open-minded and be vulnerable and share secrets is a hard thing to do.
So, hearing their experience with it and the benefits that they’ve seen already I thought was really impactful and something I think we can continue to push, CBUSA can continue to push, people like Joe and Adam can continue to push and just building this kind of construction community that we all want to have is going to lift everyone up. Will lift our builders up, will lift our subcontractors up, will lift our suppliers up, and there’s a way where we can all get better together, which is literally builder transmission. So, I thought it was a really cool perspective and a good kind of reminder of, “Hey, we’re all on the same team here. Let’s try to knock this out together.”
Zach Wojtowicz:
It was really interesting to hear them talk about the market dynamics.
Charley Burtwistle:
Yep.
Zach Wojtowicz:
You hear about that quite a bit. It never really occurred to me that, from sub-market to sub-market, that the turnkey concept would be so different, and I found that really interesting of how you go about starting a new chapter, and you have to work through not just the hesitancy, the first day of school concept like, “I don’t know what I want to share. Who’s going to go first? I don’t want to be the kid that gets out there,” but also just the sub-dynamic, having to disrupt the way the sub-trades do business, maybe disrupts the wrong word or more evolved the way that they can work with you in order to benefit both parties as equal as possible.
And I am curious what it’s like in other markets. If CBUSA has had less resistance because of the way that the sub-market works versus the GC market, and it’s really interesting to explore that little piece, and it makes you kind of zoom out and say, “What is it like everywhere?” And I love what we also talked about from everybody seems to have the same problems, but it’s really hard to find that moment of connection and be like, “Oh, you’re like me.”
Charley Burtwistle:
Yeah.
Zach Wojtowicz:
And that these networks help bring that into full effect. We have the internet, and people can post and connect that way, but you can’t really replicate that in-person connection that humans just are wired to crave, ultimately. We’re social creatures, right? So, love Joe and Adam’s perspective. Again, they just have so much fun with everything they do, and it’s not surprising that they’re so collaborative, just given their whole ethos as a company and just fun and fun-loving and just on a mission to build great things in their community, and they know that to do that they got to connect with everybody in their market, right?
Charley Burtwistle:
Yeah. And they have a fantastic podcast coming up.
Zach Wojtowicz:
That’s right.
Charley Burtwistle:
TBD.
Zach Wojtowicz:
Hint, hint, hint. They messaged, they were telling us that they were going to build a studio and so, I dropped it on at the end there.
Charley Burtwistle:
Yeah. Watch this space.
Zach Wojtowicz:
Yeah. I’ll be one of their first subscribers. You can book it. And if you want to bring us down to Kansas City and have us on, that …
Charley Burtwistle:
We could do that, too.
Zach Wojtowicz:
Yeah. Talk to our booking agents.
Charley Burtwistle:
Well, Zach, I think that about does it for us on this episode of “The Building Code.” Thank you all very much for tuning in. As always, like, review, subscribe, give us a shout. We’d appreciate it.
Zach Wojtowicz:
Thank you so much, everybody. We’ll see you next time.
Charley Burtwistle:
Peace.
Zach Wojtowicz & Charley Burtwistle | Buildertrend
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