Cardinal Crest Homes: Using CBUSA to challenge the status quo
See how this custom home builder is working with CBUSA to change the game and create more transparent relationships with subcontractors.
Who is Cardinal Crest?
In 2011, friends Adam Shaeffer and Joe Christensen co-founded Cardinal Crest Homes. It was their mutual passion for construction that turned their college friendship into a thriving business partnership. Over the last 13 years, they’ve stablished the Cardinal Crest name as a true custom home builder capable of designing and building a wide variety of styles and designs.
“We absolutely love what we do,” Adam said. “We build anywhere from 10 to 12 homes a year with an average sales price ranging from $1.5 to $1.7 million.”
Today, their goal is to set themselves apart by making the home building process enjoyable and more memorable for clients. With their in-house architectural services, step-by-step interior design consulting and streamlined communication through Buildertrend’s construction software, they’re able to do just that.
“Using Buildertrend as the one line of communication throughout the entire build definitely has its benefits for the clients as well as the builder,” Adam said.
The Cardinal Crest team is forward thinking, especially when it comes to bettering their business and enhancing the client experience. Their one-stop-shop building approach and use of technology, give them an edge – and now, they’re taking it a step further by helping start one of CBUSA’s newest chapters.
Company name
Cardinal Crest Homes
Industry
Custom homes
Location
Kansas City, Missouri
Getting in on the ground floor: Bringing CBUSA to the Kansas City market
Adam and Joe were first introduced to CBUSA by Brad Leavitt, president of AFT Construction, at one of their Builder 20 group meetings. They then met with the CBUSA team at the International Builders’ Show and decided it was a great opportunity for builders in their area.
“It got us excited, and it was something to look forward to,” Adam said.
The next step was to get other builders from their market on board. And because Joe was already heavily involved with their local Home Builders Association and the Kansas City builder coalition, it wasn’t a hard sell.
“There was already collaboration happening in our market, so it seemed very natural that CBUSA would come in,” Adam said. “And a lot of the builders in the coalition did sign up.”
As to be expected, the first couple of meetings were intimidating. Sharing company insights and financial information can be hard until you start seeing the benefits.
“It’s extremely intimidating when you’re sitting in the room, and you’re talking about what you’re paying for framing material and drywall,” Adam said. “But it’s only intimidating for the first couple of meetings. Once you start opening up, and all the builders start to open up and participate, it’s an exceptional experience. It’s great.”
Seeing the benefits: How group purchasing gives power back to the builder
Home builders are often at the mercy of many factors including housing market fluctuations, material pricing increases and economic shifts. But another lesser-mentioned obstacle is the control subcontractors have on projects. They’re often able to dictate things like when they’re coming to a job site or when materials will be ready.
Not anymore. CBUSA is changing the game.
“One of the biggest reasons I wanted to join CBUSA was to challenge my market a little bit to see if us builders and the subcontractors could be on a more transparent playing field,” Adam said. “And I feel like CBUSA definitely offers that type of relationship. I think having transparent relationships with our subcontractors makes for a winning team.”
With the help of CBUSA’s team to initiate tough conversations with subs, the Kansas City chapter has been able to shake things up and take back some control. Kansas City is a largely turnkey market, meaning subcontractors have the authority to charge a lump sum to complete their phase of the project. This leaves builders with a lack of transparency and no option to separate costs for material and labor.
“CBUSA has come in and helped us challenge our market,” Adam said. “They’ve been able to facilitate conversations with turnkey subcontractors to separate materials and labor on their invoicing, so we have full transparency. We don’t want that to be a free service that they offer. That’s not what we’re asking. Let’s just separate the materials from the labor, so we know exactly what we’re getting.”
“CBUSA has come in and helped us challenge our market. They’ve been able to facilitate conversations with turnkey subcontractors to separate materials and labor on their invoicing, so we have full transparency.”
– Adam Shaeffer, Co-founder of Cardinal Crest Homes
Up-front transparency with their subcontractors isn’t the only benefit Adam’s seen so far. He’s also anticipating the more competitive pricing they’ll be able to offer homeowners. As a cost plus, custom home builder, prices generally tend to be higher.
But with CBUSA’s brand partnerships and better material pricing, they can offer the same quality of products at a lower cost.
“For us as cost plus builders, I still see it as an incredible winning scenario,” Adam said. “If I can lower the cost of my home, I’m going to be more competitive, and I’m going to land more jobs. You make more money if the customer spends more money. But think of it differently. I’m going to land more jobs, and I’m going to be more competitive. That 1% or 2% might be the deciding factor between you and another builder.”
Plus, there’s the rebate dollars that are accumulating on the back end, which is adding to their bottom line.
“That’s what we’re really interested in,” Adam continued. “If I am purchasing materials or if I’m purchasing a service from a subcontractor, it’s incredible to be rewarded for the money you’re spending. That’s where the incredible savings is for us.”
Finding success: Looking to add thousands to their bottom line in the first year
The numbers speak for themselves.
“Let’s just say if we were to pull in $12 million for the year, I think the direct rebates we’d see would fall between $25,000 and $60,000. Now, for me, I look at that and I say, ‘OK, CBUSA is going to bring in an additional 25 to 60K.’ Now, I can offer my employees benefits. I can start a 401K for them. I can start a health insurance plan for them. And that money could help aid in those costs. For me, it makes perfect sense.”
Great businesses invest in their success. Whether it’s going to the International Builders’ Show, joining builder groups or implementing construction software, the reward you see is determined by the effort you put in.
“The most important thing you can do as a CBUSA member is participate, participate, participate,” Adam said. “You should feel an obligation to attend the meetings and to respond to questions about what you’re paying for materials. You’ve got to work as a group.”
“I think every builder in the nation should join a CBUSA chapter because it’s a very good avenue with backend support to improve your business.”
The new Kansas City chapter is already seeing success with CBUSA. Are you ready to do the same?
Apply today and start seeing the benefits of group purchasing. Improve subcontractor relationships, network with the industry’s best and add thousands to your bottom line.
Don’t see a chapter in your area? Learn more about how to get in on the ground floor.