John Pinholster says that while other companies find success by going national, this company revolves around the local community.

Many local and regional construction companies find great success when they enter new territories or take on national accounts, but that’s not the road Naples, Fla.-based Kraft Construction wants to travel. For Kraft Construction, general contracting is a local business run by local people.

“This business is about building relationships and trust with clients. We believe the only way for us to do that effectively is to focus on our own backyard, which is from Naples to Tampa Bay, where we can guarantee delivery on the promises we make,” said John Pinholster, president.

Founded in 1968, Kraft Construction Company, Inc. is the largest privately held general building contractor in Florida, building a diverse mix of luxury high- and low-rise condominiums, commercial office buildings, mixed-use projects, K-12 schools, universities, government and healthcare facilities, hotels, and community clubhouses/facilities. Projects range between $100,000 to $100 million, with an average of $30 million.

John Pinholster, President

Generating buzz
According to Pinholster, in an industry saturated with companies touting on-time, on-budget projects, word of mouth is the best way to advertise. And the only way to generate positive buzz is to deliver on promises and take responsibility for mistakes. “Kraft has earned the trust of the community. Clients expect projects to be on time and on budget, so we are good to our word in everything we do,” he said, citing a recent example of how the company was proactive in keeping its word to a client.

Kraft’s vice president of estimating had redlined a set of architectural drawings, making extensive corrections and detailed suggestions for the design team. According to Pinholster, many companies would have priced what they saw (without making any corrections) and dealt with multiple change orders later. “We wanted to give the client a price we could stand by up front. We owe it to them,” he said.

“Most clients don’t have a problem paying for a project. When changes come up late in the game, they ask, ‘Why didn’t you catch that sooner?’ Some people think a change order is how general contractors make money. Not us.”

That is probably why the company was ranked 93rd among the nation’s top contractors in 2006 by Engineering News-Record—several leaps from 113th the previous year. The list, based on 2005 revenue, places Kraft as the second largest Florida-based general contractor.

Kraft’s attitude has been the catalyst behind its growth over the years, which has been 100% organic and mainly driven by clients. Pinholster explained that the company never stuck a flag in the ground of a new market and declared its presence—instead, as clients’ business moved further north, they asked Kraft to join them. As a result, the company has grown from a one-office operation generating $200 million to four offices (Naples, Sarasota, Fort Meyers, and Charlotte Harbor) generating $500 million.

Recent growth has also pushed the company to consolidate its Naples headquarters, which was broken up into four leased spaces, under one roof. Kraft built a 112,000-square-foot facility on Pine Ridge Road and moved in on February 1, 2006. The company is occupying 30,000 square feet of office space, with another 20,000 square feet dedicated to warehouse space. Unused portions of the building will remain available for future expansion.

To complement the new headquarters, Kraft Construction recently invested heavily in Web-based accounting and project management systems and is fine tuning its scheduling system. In the past, Pinholster explained, tasks were accomplished in a myriad of ways, often by hand. “What we were doing worked fine, but as we grew, we realized we needed to pick one way of completing a task and implement it across the board.”

Land of opportunity
As a people business, Kraft Construction has invested heavily in training. In fact, in 2006, it opened Kraft Corporate University to teach its engineers, architects, and builders soft skills via seminars and lunch-and-learn sessions. The program is open to all employees, and Pinholster estimates more than 200 employees have participated in the program to date.

“Our industry has a structural defect in it. We hire technically trained people, and if they do their jobs well, they advance into management, which has everything to do with people and very little to do with technical aspects. These folks know how to install gas lines and reinforce a building structure, but it’s our job to teach them how to handle contracts, manage risk, monitor schedules, communicate effectively, and build a team. Today’s colleges and universities are getting better at addressing this issue, but nothing beats real world experience,” said Pinholster.

Kraft Construction is also investing in employees by committing itself to steady growth—between 5% and 10% each year. At this rate, the company can provide employees with solid career paths. “Growth allows us to provide opportunity, and opportunity allows us to attract top talent. If we can’t provide a bright future for these folks, they are going to go somewhere else,” said Pinholster. “We need to educate the right people and give them future opportunities to keep them on our team.”

Toolbox rules
Kraft not only has the responsibility to provide its 600 employees with career opportunities, but also to send them all home in the same condition in which they came to work. In addition to standard OSHA training, Kraft requires its superintendents to undergo ladder and scaffold, fall protection, general project safety, defensive driving, and safety inspection training. Three full-time safety trainers travel from site to site, working with superintendents to ensure all safety protocols are being followed to a T.

“In an office setting, you don’t expect to cut yourself on a piece of metal sticking out of the wall or to step in a hole in the floor, but a construction site is rife with such hazards. If our superintendents follow instructions and regulations, they should feel as safe on the site as they would in an office,” said Pinholster, adding that the company aims for zero lost-time accidents per year. At present, Kraft’s lost-time rate and incident rate are well below industry standards.

Although the training Kraft provides is predominantly for its own employees, its subcontractors undergo similar training programs, and the superintendent of each site holds weekly “toolbox safety” meetings that cover particular topics, such as how to identify electrical hazards and proper lifting techniques.

This attention to detail often bleeds over into good general practices, said Pinholster. For instance, on an active school or hospital campus or in a corporate setting, Kraft employees and subcontractors need to adhere to dress codes and wear security badges. “Our goal is to do our jobs with the least amount of disruption to our clients’ business.”

Kraft Construction has been rewarded for this mentality with 80% repeat business. In 2006, it was selected by the city of Cape Coral to design and construct an academic village, a partnership among the City of Cape Coral, Lee County School District, Lee County Board of County Commissioners, and various university/college branches. The Academic Village includes a charter high school, media/library building, academic buildings for university classes, a performing arts facility, and athletic facilities.

Also in 2006, the company was chosen by Florida Gulf Coast University to construct a engineering building on the university’s Fort Myers campus. On completion, the 70,000-square-foot, three-story building will house laboratory/lecture classrooms, administration and faculty offices, and research spaces, which are currently scattered in various buildings.

“Naples is our home and our headquarters. That’s why we’ve dedicated ourselves to this community, making life better every day for its residents,” Pinholster concluded.