First post here.
Got to say theres a lot of good builders here and have been reading till my eyes have poped out 🙂
I have a question that needs some true thought.
I have read and not seen any answers that would help my question.
I started a Company sometime ago part-time, and now fulltime. My lead flow is through the roof and I got some SERIOUS growing pains.
I have a close tie to another General that’s does the EXACT same work I do and we get along fine, We have tossed the whole, split the job idea, but i am not comfortable with that.
My only alternative is to hire and that is a drag because it will compromise my quality and those who know, work comp is going to hurt!!
Got a turn key guy ready to work, want’s ALOT, but figure I won’t have to babysit.
Or get a young helper??
That’s my question. Alot of you were here where I am.
What did you do?
Thanks all.!
Edited 10/1/2003 12:21:32 AM ET by RCS
Replies
What route you take (or should take) depends on what you like more than anyone else's experience. If you are not interested in teaching, don't get an inexperienced worker. But just because you get an experienced worker doesn't mean that you will be able to just let him go on his merry way. You will need to train him to your methods and level of quality and monitor his work closely until he knows just what you want.
My only other bit of advice is that you determine just what you need to charge to pay for your help. Do a search in the archives for information about how to do this. Remember that you need to cover your costs based on the number of hours that you actually bill out.
RCS,
First off, welcome to Breaktime.
It's always a good idea no matter who you hire to find energetic go getters that are "into" building. Not someone that "just" needs a job.
Secondly you need some one you can trust in every respect especially when in someones home.
A bad quality in an employee are people that talk to much to the customer......they always say something they shouldn't. Never fails.
Its a good idea (depending on how much work you have) to hire a helper and a carp. Its up to you to keep an eye on what they're doing and to "communicte properly" what you need and want them to do.
Always be open to new ideas...we all have a lot to learn from one another and its important to let whom ever works for you know that. You from them, as well as them from you.
You need to deciede if you want to be a one man band or not...MAny advantages and disadvantages in both.
I've worked alone alot.....had one good guy work for me many times for years...Once ran three crews and absolutly hated it.
I like one good guy and one apprentice...thats what I'm most comfortable with depending on how much work I have.
Forget about compromising your work. That shouldn't be the thought, cause its a whole new ballgame when you hire people....that could "add" to the quality of your work if you choose the right folks.......good luck and....
BE well
andy
We're being trained through our incarnations-trained to seek love, trained to seek light,trained to see the grace in suffering
http://CLIFFORDRENOVATIONS.COM
As to the costs.
With an employee you will need to get a FEIN, federal employer id number.
Then you will need to withhold Social Security, Medicare and Federal Income tax from the employees check. Not sure what state you are in so you may also need to withhold state taxes. You then have to match the Social security and medicare.
Example of costs.
Wage $200.00
Soc Sec -12.40 6.2%
Medicare -2.90 1.45%
Federal W/H -20.00
State W/H ?
Empl Pay $164.70
After paying your employee 164.70, you have to pay the government 50.60 (12.40+12.40+2.90+2.90+20.00) plus state W/h.
You also have to pay for workmans comp insurance (contact insurance agent for rates).
You also have to pay state and federal employment. These rates can vary but for example use 4%.
You may also have to pay an accountant to make out quarterly payroll tax returns and year end W-2s.
This probably seems overwellming, but if you want to grow your business, you're going to have to do it eventually.
You get out of life what you put into it......minus taxes.
Marv
You are in that best and worst of situations. Enough work that you can't do it all on your own, and facing having to get someone your work to your standards.
I never had problems finding good helpers, it always seemed like there were plenty of people out there with the drive to do a good job. That, and I started by delegating the most time consuming tasks, and repetitive tasks out first. As I got to kniw the skills of the hands better, or they learned OTJ, I could delegate the efforts better.
What clobbered ne was the expenses, the government costs, the overhead in paper work, and the like. This is where reasearch is key. Which takes time, which is something you don't have enough of just now.
Check on everything. You may need different bonding (or the institution holding your bond may have different rules with employees). Check on WC, too. In Texas we have the option of opting out of WC--but you have to provide insurance that is as least as good (turns out that is much easier than it sounds, and significantly cheaper, too). Double check on the administrative side of hiring too. Some state or county employment offices will have information on small business hiring.
Be very carefull when hiring hands on as subcontractors. Our friends with infernal revenue have some very strict rules about that. Even if your contract stpulates that they are working their entire 40 hour week for you, you may still get asked to provide copies of their self-employment forms, business licenses, and/or sales tax forms.
So, should you expand? Yes. Should do it carefully? Yes. Will it be a success? Only time will tell. The odds were against you when you started by yourself, so you have leapt the first big hurdle.
RCS,
I went through this last year. I do light remodeling and handyman work. So I felt I really needed someone who could work on there own at least part of the time and yet I could stand to be around the rest. Ultimately I wanted someone who could manage on their own say 80% of the time in a year.
All the advice above is good. But what I really wrestled with was whether to go with an "A" player or "B". I chose the A. More expensive and all but soon was making me money without so much handholding. I too was concerned about quality as I try to market myself as the quality handyman service in my area. I found the first 2-3 months required a fair amount of babysitting to get what I wanted and things done the way I wanted. But after that my new hire has taken off and done well.
In short if you want to maintain quality and things done a certain way you will have to train whoever you hire your expectations. With a "B" player it will just take a lot longer as you are teaching skills also. DanT
Having good people makes me look good.
Having a trainee is expensive. I have to spend time teaching instead of being productive. That is good with someone who wants to learn and has a good attitude.
There is no reason whatsoever the comp and FICA costs should hurt you at all. Let me explain.
Let's say that lead carps get $28/hr and the comp is 20%. Throw in the Fica and missc other insurances or overhead, and the minimum you can bill him out at is $38 without losing money. ( actually, a rule of thumb would be more like 50% add but you have to know your own numbers.)
I'm guessing that by comparisson to the example, you have been charging 28 - 30 bucks for yourself and that is why you think it would hurt.
You should be charging the full value for yourself. That establishes the value of the work. Take that 38 and add profit. Now you are billing out or bidding $42/hr for a four dollar profit on top of wages.
Got too much work? Now you are set to hire and you are making your wages plus another four bucks on his wages. Get a whole crew and that profit rewards you for all the late nights estimating and bidding and managing the money - not to mention worrying.
The flip side of that is that you don't take a profit, get burned out working for free and quit the industry. That does no-one a service.
Excellence is its own reward!
I can't give business advice. Many others here can. But, I've been an engineering supervisor in a manufacturing plant for a large corporation for a number of years and learned a couple of key lessons that may help.
First, the most important thing a supervisor can do is hire the right people. Sounds obvious, but of course with great people everything runs smoothly. With mediocre people you spend your time working on them rather than the real work. What I'm saying is, it's important to wait as long as it takes to find someone who you feel comfortable with giving a try. If you have a bad feeling, keep looking, even if it takes months. That's not to say that everyone you hire will turn out great, nor can you hire Norm Abram, but if you settle too low it never gets better.
Second, the best predicter of future performance is past performance. So work history and recommendations are very valuable. When hiring entry level, I often call the college instructors at the local techical schools and ask for name of pending or recent graduates they'd recommend. If you have a construction program in your area there may be some potential there. You may get someone trained enough you don't have to babysit, but who is still moldable to your standards.
Third, practice integrity. If you try to pay under the table, cheat a little here and there, then you're going to attract similar people and they'll no sooner respect your livelihood.
rcs... one of the things you've got to do is try to figure out what you want to be when you grow up...
are you going to be a carpenter or a business owner?
something you could sell to somebody or hand over to your kids when you retire ?
it's hard to get fullfilment out of your work if you're not sure what your work is...
i like going after the interesting and hard jobs.... they're interesting and they usually pay better.. hard to do if you're a one-man band...
can you do joint ventures with your buddy?... yes.. a lot of us do...
i personally like having employees.. we get more interesting work because we have the ability to say "yes"...
if you have the trainee... he's going to be your shadow.. you can't leave him/her alone... things won't get done to your nor the industry standards..
if you have the experienced carpenter... you have to learn how to manage people...
give them their head and they'll run things their way...not yours
apply too much control and they will leave to feed their creative juices someplace else
but , if you can develop a good company... and a business.. it can be very successful and rewarding..
piffen and others were pointing you in the right direction... you have to price your jobs to pay the kind of employees you want to keep..
and 50% over their wage is the minimum i use for labor burden... that is before company overhead and profit...
ie: it costs me 50% more than thier hourly rate just for production... on top of that you have to add for company overhead and profit.. managing a company takes time... and time is something you will never have enough of.. so , the more you manage, the less time YOU have for production... and the more you have to rely on your employees for production..
or ... get your office to run the management end so you can concentrate on production.. you do have an office, right ?.... even a corner of the den.. you need an office, because you are running a business... so... turn your leads into contracts, and your contracts into production ... and start managing your employees to deliver your product to your customers..
want some help ? i mean face -to-face ?... join your remodeler's or builder's association.. you 'll meet some great people ( and a few jerks) and get a lot of help...Mike Smith Rhode Island : Design / Build / Repair / Restore
Read "The E-myth for Contractors".
Thanks all!
GREAT advice from everyone.
I have decided to hire the lead carpenter. He will cost me (when all said and done) roughly 87.00 per 100.00 I pay out. Yeah that much..................
I also am having the other contractor do some pick up work for me. He just wrapped a job up for me so I could go do some bids. :(
California is great, eh?
To give you guys a little backround. I kind of got the feeling some thought I went into this thoughtless.
I worked for the Termite Industry for over 12 years. I was lead crew member in the wood tech's dept.
I then went on to do inspections and sells.
So in 12 years I have held MANY a position that was directly related to home owners (fixing/selling to them)
I decided NOT to start a Termite company, instead I turned my focus on the repair end of it and got my General.
I only intended on servicing my ex-company, and only a select few Inspectors at that.
WELL.......... Not gloating, but I started getting calls from the ENTIRE company telling me I had to do some work for them and they fired their guys after the select few had bragged a little. Compound that with the referrals I am getting and I am going nuts.
Lastly, and the main reason I started the Construction buis. is that the bidding is wide open. If you can get there to bid the lead, it's sold. And at a price that usually shows a 75% profit. These people can't find anyone, nor the expertise to identify fungus and termite damage and fix it CORRECTLY, not with some Bondo and sisterd boards.!!!!! AND also someone who is a state lic. Termite Operator lic. to boot
I won't have to raise prices. Hell I can still lower them. I just have to come to the realization that I can't do it all.
I had my "Business plan" but it failed miserably because I have broken the rule of over extending myself. Things happened fast, and I mean fast.
I also had a GOOD friend enter the Reverse Mortgage company thru HUD/FHA and I get NO LESS than 3 faxes per day from them for slam dunk repairs.
This just scares the hell out of me. Having someone I am responsible for tearing out a 20,000 bathroom............. Or tearing off all there eaves back to the top plate.
Growth was something I under estimated. I really thought I could do it alone, had been for years. (weekends,vacations)
Thanks guys. This place is great.
Congratulations, and sorry if I read you wrong.
Stick around and help out - like start a thread on the RIGHT WAY to fix termite and rot damage - with pictures!.
Excellence is its own reward!
"the most important thing a supervisor can do is hire the right people. Sounds obvious, but of course with great people everything runs smoothly. With mediocre people you spend your time working on them"
Waynel,
Every now and then SOMEONE here says something that should be obvious, but isn't, but is really good.
You get Jon's high five for the night for that one.
Been there.
Jon