A lot of builders compete on price and operate on narrow margins. This leaves little revenue to perform warranty repairs or to correct errors made during construction.

These builders oftentimes rely on the profit from the next job to fix mistakes from the last project. As the economy slips into a recession, these revenues shrink even more and the pool of funds available to remediate mistakes dries up.

Delays in performing repairs increases and customer frustration grows. As customer complaints intensify, the quantity of lawsuits rise.

The solution is simple, but multi-fold:

1. Fix your errors and warranty call backs promptly.
2. Maintain open lines of communication – don’t ghost clients or feed them BS.
3. Increase the contingencies built into a project. Set them aside into a separate account, and don’t spend them upon each project completion.
4. Improve quality control and reduce errors & mistakes.

Now, more than ever, as the economy constricts, clients will become more frugal and conscience of what is occurring in their yard. They will be less tolerant of delays and excuses.

Avoid the vortex.

This was a post originally published on Facebook that received an enormous response from peers within the industry.

Thoughts from some of my followers:

I don’t play the race to the bottom game to get the job. I have my margins and if someone goes cheap, they can have the job. If I don’t make what I need to, I walk away.

Michael Koenig

Another way to remediate this is to ensure that your profit margins are adequate enough that you don’t have to rob Peter to pay Paul. If you’re actually performing quality work, the customer should be charged accordingly. Quality work costs money; most reasonable customers understand that. Michael Calore

Great advice. As a a 40+ year pool builder I wish just one of ex employees that decided to go into business for themselves would take the time to learn the business. I wouldn’t have made a career of repairing (and being paid well) for repairing others mistakes. JA GROW

If you are a contractor who is involved in pool construction or making other outdoor site improvements, you might be required to obtain a contractor’s license and a license bond. Swimming pool contractors in some states are required to obtain specialized licenses, and bonds are frequently required as a condition of licensing. For example, California requires swimming pool contractors to obtain a swimming pool contractor license, which carries a bonding requirement as a licensing condition. Other states, including Florida and Texas, also require bonds for pool contractors who perform electrical work on pumps and other components of pool installation.

Even if your state does not require you to obtain a specialized license for pool construction work, you might have to get a general contractor’s license and post a bond to perform work above a certain amount. In addition to license bonds, there are other types of contractor bonds that you might need based on the size of a project or the requirements of the project owner. Here is some information about contractor bonds for pool contractors and those who perform work on other outdoor improvements.

What Is a Surety Bond?

A surety bond is a legally binding agreement between the following parties:

• Principal – The individual required to post a bond

• Obligee – The party, which might be a governmental licensing authority or private project owner, that requires the bond

• Surety – The bond company that approves and issues a bond as a guarantee the principal will comply with its legal and contractual obligations

About Surety Bonds

Surety bonds are not a form of insurance. Instead, they protect the obligee and the public against potential misconduct on the part of the principal. When a bond company approves a surety application, the principal must sign an indemnity agreement through which it agrees to hold the surety harmless in the event of a filed bond claim and loss. Ultimately, the principal is the party who will be responsible for paying valid bond claims that might be filed.

Types of Bonds

License bonds are bonds that might be required as a licensing condition before a contractor can secure a license. These bonds might be required by a state licensing body or by a city or county before a contractor can obtain a license or certificate to perform work in the jurisdiction.

Many contractors who perform work on outdoor improvements or construct pools might also be required to post contractor bonds. A contractor bond is a type of surety bond that guarantees the contractor will perform work that meets the provisions called for in a contract.

3 Most Common Bonds

These bonds might be required for public projects valued at $100,000 or more. Many private project owners also require bonds before they will enter into contracts with pool contractors and those who will perform work on other outdoor improvements. The following three types of contractor bonds are common:

• Bid bond – A bond that might be required as a condition of bidding on a project that guarantees the winning bidder will follow through and perform the contract at the bid price even if the contractor forgot to include something in the bid.

• Performance bond – A bond that might be required by a public or private project owner that guarantees the contractor will perform according to the provisions called for under the contract and will not complete substandard work.

• Payment bond – A bond that guarantees the general contractor will pay its subcontractors and suppliers for their labor and materials that protects the subcontractors and suppliers as well as the private project owner. Payment bonds protect private project owners from potential mechanic’s liens that might otherwise be filed by parties that have not received timely payments for their work from the general contractor.

Public-funded projects worth more than a threshold amount might require contractors to post all three of these types of bonds since they guarantee the completion of the project to specifications, prequalify contractors before they can submit bids, and provide payment protection.

Savvy private project owners likewise might require contractors to post performance and payment bonds to guarantee the contractors they choose will perform the work as promised and will pay their subcontractors and suppliers.

How Do You Get Bonded?

To get bonded, you can apply for the specific types of bonds you need by applying to a bond company. The surety bonding process involves an extension of credit from the bond company to the contractor, so the application will be sent through an underwriting process. The factors that a surety will consider to determine whether or not to approve a bond application include the applicant’s credit, business experience, working capital, stability, reputation, and others. Evaluating these factors helps the surety determine the degree of risk it would face if it approved the bond application.

If you have a great credit score, substantial experience, strong working capital, and a good reputation, the surety company will likely determine you pose little risk and provide you with a bond quote of as little as 1% of your required bond amount. For example, if you are required to post a $25,000 surety bond, you won’t have to pay the full amount of the bond. If you are quoted 1%, you will instead need to pay 1% of that amount of $250. By contrast, if you have poor credit, your application might be denied, or the surety might provide you with a higher quote of up to 10%. In that case, you would have to pay $2,500 to secure your bond.

Renewing Bonds

Bonds are not permanent. Instead, they must be renewed. Once you have posted the bonds you need, you should make sure to pay attention to when they expire and apply to renew them before they do. If you avoid bond claims and maintain good credit, you can anticipate continuing to receive low bond quotes. If you had to post a larger bond premium because of a low credit score but have worked to build your credit since you originally posted your bond, you might find that you receive a better rate when it’s time to renew.

Surety bonds are a common requirement for contractors who construct pools or complete other outdoor improvements. Making sure that you understand your requirements and that you always comply with the law and your contractual obligations can help you secure better rates and also build a strong business reputation.

(Alexandria, VA) – The Pool & Hot Tub Alliance (PHTA) today announced it is jumping into the waters of workforce development with its Pool Professionals Pipeline, a new program designed to help its members find workers, drive awareness amongst today’s jobseekers, and foster long-term career progression in the pool, hot tub, and aquatics industry.

“It’s no secret that many industries and businesses today are struggling to find and retain employees, and this is particularly true in trades such as ours,” says PHTA President and CEO Sabeena Hickman, CAE. “Our members are looking to PHTA to help fill that gap and we’re ready for the challenge. We are incredibly excited to share this new program with our membership and give them the tools they’ll need to compete in today’s labor market while working to attract a skilled, diversified, and thriving workforce.”

Underneath the PHTA’s Pool Professionals Pipeline workforce development umbrella is its external industry awareness campaign and jobseeker website, Work in Aquatics and workinaquatics.com, launching in 2023. Work in Aquatics will seek to advocate for trade professions by highlighting the numerous advantages, training and apprenticeship opportunities, job openings, and potential career progression tracks that are available working in the pool and hot tub industry. From construction labor to lifeguards, sales representatives, entrepreneurs, and even engineers and designers, there are many industry sectors and paths along the way that PHTA wants jobseekers to explore.

“This program is a game-changer for our industry as it works to drive qualified talent to our respective businesses and our industry as a whole,” says PHTA Chairman Charlie Claffey, owner of Claffey Pools. “To be successful, we’re going to need everyone on board as we work to put the industry on the radar of those searching for an alternative path to college; a rewarding career in a healthy lifestyle environment; the ability to work away from a desk; creative freedom through modern design; and lifesaving skills through swim instruction. The possibilities that exist in the aquatics industry are endless and once you begin in this line of work, you’ll never want to walk away. Let’s share that passion with the next generation of workers.”

A steering committee comprised of PHTA members, industry partners, and PHTA staff will serve in an advisory role to help guide programming, funding, and more:

• Charlie Claffey, Claffey Pools
• Joseph Laurino, Ph.D., Periodic Products, Inc.
• Andrew Levinson, PoolCorp 
• Elizabeth McMurray, Florida Swimming Pool Association 
• Albert Miller, Hayward 
• Dominick Mondi, Northeast Spa & Pool Association  
• Kevin Post, Counsilman-Hunsaker  
• Teri Wiltshire, Master Pools Guild  
• Lisa Zarda, CAE, US Swim School Association 

Members, partners, and others interested in becoming involved in the PHTA Pool Professionals Pipeline can contact Seth Ewing, PHTA Senior Director of Member Programs & Services, at [email protected]  

Media Contact:
Amy Willer
Associate Director, Marketing and Communications
703-838-0083, ext. 121 | [email protected]