Professional Builder Levels
APB’s Professional Builder Levels are based on the fundamental belief of never scaling an unprofitable building company. They will help you implement systems to take a step back from day-to-day operations, use financials to make data-driven decisions, and scale your building company safely and securely. It’s not theoretical; we have the case studies to prove it. Only once you complete all ten levels can you reach the final rank of Certified Professional Builder. Take a look at the levels below to see where your building company ranks.
Professional Builder Levels
Calculating WIPAA Accurately Every Month
The Work In Progress Accounting Adjustment (WIPAA) is the most important figure in a building company’s accounts. If it’s missing, or not calculated correctly, WIPAA can and will silently destroy building companies.
Enough Cash To Cover WIPAA Liability
Running a building company is cash flow positive, and your WIPAA is essentially other people’s money (OPM). So for your building company to be in a sound financial position, you must hold enough cash reserves to cover your WIPAA liability.
High Converting & Content-Rich Optimised Website
Just having a website isn’t quite enough. Your website should be optimised to generate leads by following the training included in the APB Membership portal. Your website must be content-rich, with a section that includes helpful content for consumers considering building a new home.
Invest 3% Of Revenue Into Marketing & Advertising
Professional building companies aim to invest 3% of targeted annual revenue into marketing and advertising. Initially, you will need to invest 2% of your revenue in content creation (things like a website, photography, videos and brochures) and just 1% into paid advertising. As the company grows, the ratio will swap to 1% content creation and 2% paid advertising.
Gross Margins Exceed Industry Benchmarks
If you specialise in new homes, you should target a gross margin above 25% and over 33% for remodelling to exceed the industry benchmark. But don’t forget, that’s margins, NOT markup!
Net Margins In Excess Of 10%
To be in a position to grow your building company safely, securely and profitably, you must aim for net margins greater than 10% after all expenses – including drawing your market salary as the owner of the business, which tends to equate to 5% of revenue.
Have A Sales Manual In Place
Successful building companies have a documented sales process. Your sales manual includes the full procedure for your company’s sales process and links to detailed training and scripts for each step.
Have A Company Manual In Place
A company manual is important because it ensures your building company always has room to grow and every team member is kept accountable. Your company manual should outline the job descriptions and KPIs for every existing and planned position in the business.
More Than 3 Months Fixed Expenses In Working Capital
The financial health of a building company is what determines if the business will make it through a downturn. Focus on protecting your business by building reserves and having cash for at least 3 months of fixed expenses in working capital. This is just the beginning; the goal is to get 12 months of fixed expenses in your working capital!
>10% Net Profit & A $500K Salary
The measure of a completely systemised and profitable building company that can handle growth is to reach 10% Net Profit after all expenses and draw down a $500K salary for the owner.
certified professional builder
CERTIFIED PROFESSIONAL BUILDER
After a building company has achieved Level 10 of the Professional Builders Levels, they become Certified. Becoming a Certified Professional Builder is the ultimate goal for all building companies. When you become a Certified Professional Builder, you’ll have all the fundamentals in place to grow your building company safely and securely without being hands on in the day-to-day operations.
"For anyone who has just joined the APB or is thinking about joining APB, if they look at the levels, they would probably think ‘geez that is absolutely impossible’, but it's truly not. I'm proof of that.”
Certified Professional Builder
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