When I think of Entrepreneurs,I think of risk adverse dreamers going for the gold in new and exciting innovative industries.When I think of General Contractors,I think of “old school” bricks and mortar blue collar small business owners.On the surface both of these types of business personalities seem to be miles apart in philosophy and revenue but things are not always as they appear.Little did I know that kitchen remodels in particular could out perform most business ventures in a 30 day turn around time almost without exception.
“It’s a very specialized field,” says Ryan Dunn, owner of Trinity Builders in Edwards,Colorado.Ryan has built a rock solid reputation as an award winning contractor and custom home builder and has set a new standard as an entrepreneurial contractor.
There is without question a lot money in this business.Dunn’s company grosses between $4.5 million and $7.5 million a year on the 20 to 30 jobs it performs annually. The average custom kitchen remodel, including installation, runs about $90,000 although jobs start at $30,000 and reach $500,000.
I thoroughly love talking to Dunn.He routinely speaks in no-nonsense sentences, like many small-business owners I have met who have no time to waste.He most definitely knows his craft and has that”x-factor”when it comes to designing and constructing mind blowing kitchens.
Dunn swears by premium kitchen appliances made by brands such as Liebherr and Sub-Zero,with their $12,000 refrigerators and $4,000 steam ovens.Although Dunn’s company Trinity Builders are considered ultra high-end kitchen remodelers, many of their clients have received a high quality product at mid- level pricing.
“We specialize in high end,but we also do quite well with competitive cabinet lines,Dunn says,adding that a quality Sub-Zero refrigerator can last for decades and pay for itself in spades.
Details are most essential in designing kitchens, which is why engineering, math and drafting are paramount. Designers must calculate when a cabinet door is too heavy for a hinge. Or whether a “slider system” under kitchen doors delivers a smooth glide.
“You have to be technically outstanding,” says Dunn. “You must be able to draft, and be an expert at math. But you also have to engineer, understand how things work together. You cannot survive in this business unless you have these kinds of technical skills.”
Kitchen designers can earn from $800,000 to $2,000,000 a year, depending on the scope of their business. They generally receive about 25 to 35 percent of the total cost of the kitchen, while Dunn receives a slightly lower margin, he believes in maximum quality delivered dollar for dollar relying on referrals as the life blood of his business.
Interestingly,Dunn confirm’s what very little I know about the kitchen remodel industry: It’s all about the cabinets.
The most lucrative cabinet margins can exceed 150 percent or more, by far the most profitable job in a renovation project. Because each kitchen is different and custom designed, cabinets are often custom-ordered and built by boutique manufacturers.
The bottom line is this.In today’s dog eat dog competition for profits,kitchen remodeling is definitely heating up and giving tradition minded entrepreneurs a run for their money.When considering your options starting out of the gate as an entrepreneur,never discount traditional business models such as running a kitchen remodeling company.