Besides the expense that accompanies the new Lead Renovation, Repair, and Painting (RRP) rules, (or the potential greater expense for not complying), some remodelers are finding that stress of the new law is extending to their staffs. In California, exterior contractor Phil Isaacs has said goodbye to two sales staff members recently. Keeping up with RRP proved to be too much for them.
The Final Straw
"We expected to be up 30 to 40% this year, and we were headed that way," says the president of California Energy Consultant Service, Rancho Cordova, Calif. "That was even a conservative number, but one of the sales guys I hired that I thought was going to pull three or four jobs a month decided to go into retirement."
The staff member was a former business owner that was closing his doors. Isaacs purchased the business and the owner, an older gentleman, agreed to stay on in a sales position. "The lead law was one of the things that scared him away, as well as some other hoops we've had to jump through recently," Isaacs says. "We had a healthy relationship, but for him, who had been working in the industry and had been through plenty of peaks and valleys himself, it was an issue he didn't want to deal with."
Isaacs says he lost a second sales person to the lead law as well. "I have to lean on them to help me through some of these business changes, because a lot of our sales people are co project managers," he explains. "The RRP rule was the straw that broke the camel's back."
Compliance with RRP has driven up project costs, which has caused the company to lose some jobs, Isaacs says. While his staff understands that the company isn't charging more because it wants to, but because it has to, the consumer learning curve that accompanies the change is a challenging one. "Almost none of our competitors are doing anything about compliance," Isaacs says. "We're routinely going against guys who haven't even heard of RRP, and homeowners tell us the other companies they interviewed never even brought it up."
Regrouping and Replanning
Though losing two staff members has stalled Isaacs' bold growth plan, he says he can't blame the men for extracting themselves from a tough situation. "I understand how tough it is," he says. "I told them, 'all we need is one audit and I'll meet you in the unemployment line.'"
Today, Isaacs is re-evaluating California Energy's growth plans. "My goal was to launch a solar division this summer, but because of the administration and owner focus that RRP has taken, and the policy changes overnight, it makes it very difficult," he says. "I'm backing off adding new things to my plate. The sales guys need to have clearly defined rules and guidelines to follow, and if we don't have that outlined, there's going to be chaos."
Isaacs calls RRP an "overnight change" that the industry has had to respond to, trumping other business planning. "We've been forced to respond to RRP, but you it's important to take that reflection time and get up to speed," he says.
While training organization The Connor Institute estimates that only 10% of remodelers are in compliance with RRP, Isaacs says ignoring the new laws is not an option for California Energy. "We can't afford not to," he says. "We've been around for 30 years and we have too much to lose b not complying with this law.
"What really made me wake up and comply with the law immediately was the $37,000 fine," he adds. "It's not a question whether the law is ever enforced or not. The question is, can we take a risk of losing all our jobs and the company? It may be a headache now, but the downside is just too big."
