Tag Archives: Contractors License

11 Best Construction Books to Read in 2010 and 2011

Top 10 Construction Books to Read in 2010 & 2011

Here at CSLS our Instructors are often times asked for helpful tips on how to run a successful Construction business once a Contractor has earned his/her Contractors License. We love this question and typically will point our students in several directions to obtain the best tips. What we also do is suggest that our students follow best practices in developing a successful construction business. In doing so we found that many successful entrepreneurs maintain ongoing training and development to continuously sharpen the saw (no pun intended). In fact, an old quote says “Books are the quietest and most constant of friends; they are the most accessible and wisest of counselors, and the most patient of teachers.” With that said we have found most of our best book sellers are those that provide current Construction industry news, best practices, and tips. The construction profession is fortunate to have a multitude of counselors who are willing to share their insights with their peers. Above is Contractors State License Services/CSLS’ selection of the best books to read for any construction professional or for those that aspire to enter the construction profession. We have diligently outlined books to help you improve your construction business, skill-set, understanding, and increase your customer’s value in your construction business. The top 10 books plus the bonus book aims to provide valuable ideas and tips if applied correctly will help you increase your construction business effectiveness.

Take a look at great books such as Blue Print Reading, Code Check Complete, Contractor’s Survival Guide, Construction Forms & Contracts, and Construction Estimating Reference Data.

Find out more at our Bookstore!

Looking for A Marketing Slam Dunk: Advertising 101…Learn The Basics About Advertising

Marketing Slam Dunk

Learn the Marketing Slam Dunks for Every Contractor Business

Advertising is a form of communication intended to persuade an audience (viewers, readers or listeners) to purchase or take some action upon products, ideals, or services. It includes the name of a product or service and how that product or service could benefit the consumer, to persuade a target market to purchase or to consume that particular brand. Commercial advertisers often seek to generate increased consumption of their products or services through branding, which involves the repetition of an image or product name in an effort to associate related qualities with the brand in the minds of consumers.

Most contractors know that they must include their license number on all advertising. But do you know what that really means and what the laws really say? Business and Professions (B&P) Code Section 7030.5 states that all licensed contractors are required to include their license number in “(a) all construction contracts; (b) subcontracts and calls for bid; and (c) all forms of advertising, as prescribed by the registrar of contractors.” The Code further provides that failure to comply with this requirement can result in a fine between $100 and $1,000 for a first offense.
The following tips for advertising will not only help you comply with the law, but will also help you plan your marketing strategies for success as a licensed contractor.

1. Include your Contractors license number in anything that might be considered as advertising.
Examples include: newspapers, radio, television ads, your business card, any contract proposal, lettering on every one of your commercially registered vehicles (See B&P Sections 7029.5 and 7029.6), signs or billboards identifying your company as a contractor, your company’s website, any soliciting brochures or pamphlets, any clothing or promotional items that include your company name and logo; and any directory listing that states or implies you are looking for work or services which would require a contractor’s license.

2. Don’t use false or misleading advertising, or advertise a price that you don’t intend to honor.
B&P Section 7161 makes it a misdemeanor “for any person to ….[use] false, misleading, or deceptive advertising as an inducement to enter into any contract for a work of improvement, including, but not limited to, any home improvement contract, whereby any member of the public may be misled or injured.”

3. Don’t advertise to do work that you are not licensed to perform.
Contractors who advertise to do work beyond the scope of their license are subject to a fine of not less than $700 and not more than $1,000, plus any other punishment established by the Registrar of Contractors or a court. Such offenses are deemed misdemeanors according to B&P Section 7027.1.

4. When advertising about asbestos removal services, be sure to include your asbestos certification and registration numbers along with your business name.
Contractors must list their asbestos certification number issued by the Board and the registration number required under Labor Code Section 65015.5. The Registrar will issue a notice to comply if either of these numbers are omitted. If a contractor fails to comply after receiving notice, a citation will be issued as well as potential fines ranging from $100 to $1,500.

5. Don’t advertise about bonding.
Contractors are prohibited from including any reference to the contractor being “bonded” in any advertisement, or on any company “paperwork” that could reasonably be considered “advertising”, if the bond being referred to is the standard license bond that all California Licensed Contractors must have. B&P Section 7071.13 provides that any such references or presentments are grounds for discipline and/or suspension of the contractor’s license.

6. Be VERY careful when advertising as “insured”.
CA licensed contractors cannot advertise that they are “insured” unless they state what type of insurance it is. Any reference to “insured” in your company‘s advertising must specifically state the type of insurance you are referencing. Failure to properly identify the type of insurance in the advertisement is cause for discipline pursuant to B & P Section 7027.4. If for example you want to advertise that you carry both commercial general liability insurance and worker’s compensation insurance, then it should be stated as such, “We carry Commercial General Liability and Worker’s Compensation Insurance.”

Knowing the law can help keep you out of trouble with the CA State Contractors Licensing Board and prevent legal problems that can arise from mistakes.


1 See Wikipedia @ http://en.wikipedia.org/wiki/Advertising .
A misdemeanor is a crime punishable by imprisonment in a county or city jail or detention facility not to exceed one year. Except where the law specifies a different punishment, a misdemeanor is punishable by imprisonment in a county jail not exceeding six months and/or a fine not exceeding one thousand dollars. See California Penal Code Section 19.

CSLB Takes the Cake for Sting Targeting Illegal Operators + Ten Reasons to get your License

CSLB Web Release www.CSLB.ca.gov shares the latest news regarding the legal necessity for Contractors to operate with a California Contractors License. Here at Contractors State License Services our mantra is to share the news and events that effect our prospective students and students. Just this month alone we continue to see more and more news of targets on illegal operators. In this case the CSLB stings another ten for violating California contracting laws. These news bites further illustrate the need for a valid Contractors License.

CSLB Takes the Cake for Sting Targeting Illegal Operators
Ten headed to court for violations of California contracting laws

SACRAMENTO – Members of the Contractors State License Board (CSLB)’s Statewide Investigative Fraud Team (SWIFT) received a torte and a hearty thank you from a licensed contractor for a sting operation conducted in Monterey last week. One of the ten arrested suspects said he worked for the grateful licensee, which was not the case. The sting operation, on September 30, 2010, was conducted with assistance from the Monterey Police Department and Monterey County District Attorney’s Office.

During the operation, SWIFT investigators posed as homeowners who were looking for a contractor to do fencing work on their home. Those who bid more than $500 were arrested and issued an issued a Notice to Appear (NTA) in court for contracting without a license. California law requires all home improvement jobs valued at greater than $500 for labor and materials be undertaken by a state-licensed contractor. Those without licenses may advertise their services and work on jobs valued at less than $500, but their ads must state that they are not licensed. Licensees are required to put their license number in all ads. Some of those who will be going to court will also face charges of soliciting an excessive down payment. State law prohibits asking for down payments greater than $1,000 or ten percent of the contract price, whichever is less. There is an exception for about two dozen contractors who purchase special consumer protection bonds that are noted on CSLB’s website.

“Many consumers don’t realize the risks they take when they let an unlicensed operator into their home,” said CSLB Registrar Steve Sands. “Those who are violating the state’s license laws are also not complying with important consumer protection requirements, such as purchasing workers’ compensation coverage for their employees.”
State law requires licensed contractors to carry workers’ compensation coverage for all employees. That ensures the homeowner isn’t stuck with medical bills if a worker is injured on their property.

Top ten reasons we hear for getting a Contractors License:
1. To legally operate in California
2. To protect yourself
3. To gain respect from your colleagues and prospective customers
4. To be competitive
5. To be self employed
6. To gain prestige as a professional and avoid the negative connotation that follow unlicensed contractors
7. To enter into larger contracts & advertise without being worried
8. To avoid being arrested and fined by the State
9. To network with other licensed contractors for more business
10. To be able to legally collect for work performed

View A CSLB Sting Operation Video here!

National Association of Home Builders Reports: As Downturn Lingers on, Remodelers Toss ‘Business as Usual’ Out the Window

The National Association of Home Builders Reports:

As Downturn Lingers on, Remodelers Toss ‘Business as Usual’ Out the Window

No one at the Remodeling Show in Baltimore on Sept. 14-17 seemed to be sure of when the market will fully recover from its current downturn, but those whose businesses are performing the best aren’t waiting to see a substantial improvement. Instead, they have been changing who they are and how they operate, recognizing that their prospective customers have changed drastically as a result of the economic recession.

“We’ve all been burned a little bit and we want to put our poker chips on things that have given us a return,” said Bruce Case, president of Case Design/Remodeling, Inc. in Bethesda, Md.

After seeing its average job size tumble last year to half of what it was in 2008, his company has restructured to bring in more medium-sized jobs, and it is finding demand solidifying for kitchen and bath improvements. But Case does not foresee an end to the downturn for another two to five years, and is projecting modest annual gains in the 5% to 8% range in the meantime.

Speakers at the conference overall said that remodelers need to invest in professional business practices if they haven’t done so already, especially in calculating their costs and profits so that they know how to price their work and how much revenue they need to bring in to sustain their operations. In a segment of the housing industry that is dominated by very small businesses, many of which are still operating out of the back of a pickup truck, many remodelers have yet to adopt these basic practices.

No matter when a recovery does materialize, presenters at the show warned, remodelers should be focusing on redefining their businesses now and resist the temptation to just get by in soft times. Some of the remodelers attending the annual show, which is produced by Hanley Wood and sponsored by NAHB and Remodeling magazine, will reach record sales this year despite a generally downbeat market, speakers observed.

A ‘Wake-Up Call’

“This is a wake-up call,” said Melanie Hogdon, president of Business Systems Management, Inc. “Things won’t return to the way they were five years ago.”

Aside from bruising consumer confidence, the recession has dealt a more direct blow to home owners, who have lost the equity they previously plowed into improving their homes but still have to rely on their own money for remodeling projects because it’s hard to get loans, she said.

“It’s a buyer’s market,” Hogdon said. Prospective customers are just looking and in no rush to sign a contract. They are no longer grateful for a contractor calling them back. In today’s perilous times, “they want you to provide a sense of security and help them make the rough decisions.”

Hogdon said that thanks to the Internet, today’s customers are also “better informed than ever” about products and can easily check out the track records of the remodelers they might consider hiring.

“You used to be able to upsell,” Hogdon added. Now remodeling customers “are looking for the biggest bang for the smallest buck. There is no more keeping up with the Joneses. They are looking at the contractor for guidance,” and are searching for products that are “serviceable” and not at “the highest end.”

Swapping Horses

As a result of the slowdown, remodeling companies have typically been shifting down, she said, for example, from production to custom remodeling, from custom to full service, from full service to specialty remodeling, from specialty jobs to replacement contracting and from replacement to handyman jobs.

However, this process of “swapping horses,” she advised, requires making fundamental changes in the business that are impeded by legacy issues. “You are tied to what you used to do and can’t let it go.”

Remodelers who used to sell on their workmanship, Hogdon noted, may find that this “is not working so much now that the distance between price and value has narrowed.”

Among other dilemmas remodelers can expect to face as they carve out a new identity for their business: with sales and profits suddenly squeezed, owners may find that they are needed in the field and can’t stay in the office managing business at the same time as a shift to a greater number of smaller jobs makes management more important than it was before.

“When you put the tool belt on, who’s selling the jobs?” she asked. “What other management tasks are you distracted from?”

With the hope of emerging as the last man standing, remodelers may also succumb to the temptation of “taking any job to keep the guys busy. That is a formula for a financial debacle,” Hogdon said. “You probably have too many guys,” but remedying that situation isn’t easy because you have so much invested in them.

Employees will also have to be more flexible and able to adapt to new types of work, methods, products and clientele. However, they may be entirely unequipped to do the new work.

Identifying New Clients

Among other challenges of successfully transforming a remodeling business: the historical data may no longer be relevant for projecting what you need to know; production management requirements may change a lot; and estimating and pricing may have to be done in a vacuum until reliable data from the new business becomes available.

In switching over to a different clientele, “do you know who they are, what they want, how to market to them?” she asked.

In today’s market, the value of the job to the resale of the house won’t be the reason clients decide to purchase a remodel, said Hogdon, but comfort is a big selling point.

Among the unique things that the remodeler can offer are expertise with the financing process, tax credits for energy-efficient upgrades, paperwork, home performance, specialty products and value engineering. Two-day bathrooms — something remodelers used to say could never be done — are popular, she said, and remodelers can help make a name for themselves by partnering with specialists in energy performance, becoming an energy auditor, establishing partnerships with vendors and initiating a less-hurried sales process.

There is a tendency for remodelers to imitate each other and go after the hot jobs, she conceded, and businesses can veer in the opposite direction by going after “what’s not hot, what nobody else wants to mess with.” A prime example is lining up work related to the renovation, repair and painting rule recently implemented by the Environmental Protection Agency. “Everybody hates it,” she said.

Finance Is Pivotal

Also pivotal in reconstituting the business model for a tighter market, she said, is finance. Remodelers need to reduce their overhead and job-related costs. That includes asking for discounts, increasing efficiencies in the office, eliminating necessary overhead, retraining employees to make them more productive, maintaining and repairing tools instead of throwing them out and replacing them, and working out more favorable payment terms and pricing with suppliers and subs.

When it comes to pricing jobs, a strategy of breaking even can lead to nowhere, she said.

To illustrate that point, Hogdon presented the example of a remodeling job that brings in $35,000 in income and costs $23,000, leaving $12,000 in gross profit. Subtracting $10,000 in overhead brings in $2,000 in net profit. If the identical job is repeated four more times, the remodeler has $10,000 in net profit. However, when the sixth job comes along, for whatever the reason, the costs run over and there is zero gross profit. The $10,000 in overhead on this last job “offsets all of the accumulated profit, bringing profit to zero.” The remodeler will then need to do this job five more times to make up for the loss.

In considering various cost strategies:

■“Be sure to plan for the margin you need.”
■“Slice and dice until you get a price you need.”
■“If you can’t mark up materials, charge for your unique expertise.”
■“Test your pricing strategy.”
“And never buy a job.” Hogdon said that lowering the price will lower the margin, and “lowering margins will force you to utilize a higher volume to cover the same overhead.” Another recommendation against price discounts, “they set customer expectations for more price discounts.”

Hogdon recommended using available financial tools, including Judtih Miller’s forecasting tool on Remodeling magazine’s website, information on her site — www.melaniehodgdon.com, and Google’s “markup calculator.”

When operating in a new environment, “plan ahead, test the results, keep what’s valid and abandon what no longer works,” she said. This should result in a new pricing model that’s reliable, enabling remodelers to leverage their resources to do something different.

CSLB Warns to Prevent Scams People Should Hire Only State-Licensed Contractors

“The California State Licensing Board (CSLB) says to help prevent scams, people should hire only state-licensed contractors on projects of $500 or more for labor and material.” 

More news continues to flood marketplace surrounding arrest, fines, and unlawful activity surrounding contracting without a license. Just today News 10 ABC’s Michelle Ponto reported the following:   AUBURN, CA — A Roseville contractor was arrested after ripping off an 87-year-old Auburn woman. 

According to the Placer County district attorney, 30-year-old Leron Anthony Stephenson from Roseville bilked the elderly woman out of $13,500 for a tree removal project on her property. Stephenson cashed six checks, including four blank checks given by the victim.

Stephenson was given a one-year jail sentence and must pay back the $13,500 to the family of his victim.  The elderly woman died before the defendant changed his plea to guilty in April, said prosecutor Jim Deslaurier.

Stephenson, who pleaded to theft charges and contracting without a license, was also placed on five years probation and was given a suspended prison sentence of five years and four months when sentenced May 26 in Placer County Superior Court.

The California State Licensing Board (CSLB) says to help prevent these kinds of scams, people should hire only state-licensed contractors on projects of $500 or more for labor and material.

contractor’s license number can be checked online at www.cslb.ca.gov or by calling (800) 321-2752.

More tips include:

— Get at least three bids and three references for past work from each bidder.

— Make sure all project expectations are in writing.

— Only sign the contract if you completely understand all terms. 

— Do not pay more than 10 percent down or $1,000, whichever is less.

— Do not pay in cash and do not let payments get ahead of the work.

By Michelle Ponto, News10 http://www.news10.net/news/story.aspx?storyid=90343&catid=2

To understand more on who needs a contractor’s license visit  http://makemeacontractor.com/California-contractors-license-cslb.cfm

CSLB Sting Operations How To Not Get Stung

Daily we see reports of the CSLB’s Statewide Investigative Fraud Team (SWIFT) sending unlicensed operators to jail.  Just recently in July 2010 CSLB stings stung 13 illegal operators, including violators of state energy-saving programs. We thought it best to share an overview of what the CSLB -Contractors State License Board, considers an illegal contractor and share what penalties these operators are potentially subject to. 

According to the CSLB…

Who is considered an illegal contractor?

It is illegal for an unlicensed person to perform contracting work on any project valued at $500 or more in labor and materials. Besides being illegal, unlicensed contractors lack accountability and have a high rate of involvement in construction scams. They also are unfair competition for licensed contractors who operate with bonds, insurance and other responsible business practices.

What is the CSLB doing to stop illegal activity?

The Statewide Investigative Fraud Team (SWIFT) is set up to monitor and combat illegal activity. SWIFT has teams around the state that conduct stings on a regular basis and sweep construction sites.

SWIFT also conducts joint operations and sweeps with other state agencies dedicated to combating underground activity. The partnerships with other agencies raise the penalties and fines for violators by increasing the scope of violations to include taxes, illegal payrolls, and workers compensation and worker safety.

CSLB :http://www.cslb.ca.gov/Consumers/ReportUnlicensedActivity/WhatIsIllegalContractorActivity.asp 

Penalties & Fines

“If you’re caught contracting without a license, you will likely have to go in front of a judge to answer to misdemeanor charges, which carry a potential sentence of up to six months in jail and/or a $500 fine, and a potential administrative fine of $200 to $15,000. If you get caught again, the penalties get stiffer. You could face a mandatory 90 day jail sentence as well as a fine of 20 percent of the contract price of the work performed, or a $4,500 fine.”, according to the CSLB.

Don’t get stung! Protect your future:

  • Get Licensed this is critical and the law
  • Do not engage in contracting work on any project valued at $500 or more in labor and materials
  • Advertised accurately

View Video of CSLB Sting in action


Gain The Competitive Edge

As the Construction market landscape continues to be more competitive now more than ever it is important to obtain a Contractor’s License and or additional licenses to obtain a competitive edge. With limited dollars to spend on home improvement and construction consumers are compelled to hire the best Contractor they can find and are looking for the most cost effective opportunities.

Many Consumers are not taking a chance at hiring an unlicensed Contractor for fear of potential additional cost to their projects. Consumer skepticism includes fear of unlicensed operator’s not carrying adequate insurance coverage necessary to protect them from potential claims. Unlicensed operators do not carry workers’ compensation insurance for their employees as required by California Labor Code or the contractor license bonds required by the state’s Business and Professions (B&P) Code. In this case, should a problem arise the homeowner may be liable if a worker is hurt on their property and without financial recourse if something goes wrong with the project. Many consumers want to avoid costly pitfalls such as these by hiring an experienced Licensed Contractor. For example “badly installed heating or air-conditioning units cost California families money, harm the state’s ability to meet important energy and environmental goals, and can even make people sick,” said CSLB Registrar Steve Sands. Additionally, Failure to obtain a building department permit and have proper follow-up by a California Energy Commission-certified inspector could result in additional expense and risk for the homeowner. A deficient HVAC system may affect a property’s resale value, and could harm the state’s air quality and environment. Inspections ensure that a system is safe, will produce lower utility bills, and help the state and consumer meet energy-efficiency goals. [CSLB]

B&P Code also requires licensees to place their license number in all advertisements. Unlicensed contractors can advertise and perform projects valued at less than $500 but must state in their ads that they are not licensed. A Licensed Contractor in this case would be a more competitive candidate.

The Contractors State Licensing Board works diligently to protect California Consumers from costly mistakes. Recently, four unlicensed operators contracting to replace the air-conditioning unit of a Rancho Bernardo condominium were among the 13 snared for violating California home improvement contracting laws during an undercover contractor sting operation on July 28 and 29, 2010. The Contractors State License Board’s (CSLB) Statewide Investigative Fraud Team (SWIFT) was assisted by the San Diego Police and City Attorney, San Diego County District Attorney, and the California Department of Insurance. SWIFT members posed as homeowners seeking bids for the installation of a new air conditioner, and for plumbing, painting, and tile work. “Stings like this help keep California consumers from making an expensive mistake.”

Several industries and occupations also require or prefer licensed contractors which equates to a competitive landscape:





How might you gain a competitive edge?

Get Licensed

 Network with other contractors for more business

 Continue your education with seminars and certification programs

 Advertise effectively

 Create a Corporation or DBA to protect your company

 Network and get connected via social media outlets such as Facebook, LinkedIn, Twitter

 Price competitively

 Do the best work and build a stellar reputation

 Ask for referrals

Helping Our Community & Friends

Contractors State License Services is proud to announce the John Baker Scholarship.  We believe in serving the California Construction community by providing license examination prep.  Our ongoing commitment to our students and to further education continues to be a high priority for CSLS.  Scholarships are awarded on various criteria reflecting the values of our organization. “Given the economic times it is important to give back in any way that we can.”, says Susan Ishii, General Manager   In doing so we have assisted a number of students not only earn their Contractors License but help reduce the burden of tuition. The Scholarship includes choice of one program valued at $899. This gives students access to over 25 school locations, materials, as well as seminars.

Meet a few of our Scholarship recipients  http://www.makemeacontractor.com/contractor-scholarship.cfm

Or Learn how to participate in our scholarship offerings by visiting  http://www.makemeacontractor.com/free-contractors-scholarship.cfm[slideshow]

Construction Math Made Easy

30 Percent of Students Report Having Math Anxiety

 30 percent of students report having math anxiety. We believe those statistics may be even higher considering most that struggle with math avoid it like the plaque. Therefore the percentages likely are a much higher percentage rate.

“When you’re building a house, you would never think of trying to put up the second floor before the first floor. Building is a sequential process. The same is true in math, each concept builds on the ones that came before. In history, you can understand the Depression pretty well even if you didn’t study World War I. But in math it’s different, you need to understand factoring very well or you won’t be able to solve equations.

This means that if you’re strapped for time, the one course that’s most dangerous to let slide is your math course. With other courses, if you don’t understand day 11 you can probably follow the lecture on day 12. With math, you have to understand day 11 or you’ll likely be lost in day 12. Construction Math is no different.

The moral is that you need to stay current. If ever you don’t understand something, get help on it right away. Otherwise you’ve just knocked away the first floor of your house, and you know what that will do when you try to put up the second floor. ”  [Stan Brown, Oak Road Systems]

Break the anxiety of Construction Math by:

1.       Being prepared

2.       Seek qualified instruction

3.       Practice Practice Practice

4.       Test your skill-set

5.       Keep a positive frame of mind

 Review the video file and contact us for more tips!