I was just finishing my invoicing and noticed that it was invoice number 101 on the 1ST of November
that means i send out ( actually hand carry….. i never mail invoices ) an average of
2.5 invoices every week….
these two were for some T&M work…. $5000 & $500…
let’s see #89 was on 9/24/08 ( $6,200 )……. #90 ($5300)….. #91 ($500 )…..
#92 ( $1125 )…. #93 ($634 )…….. #94 ($4700 ) …….#95 ( $135 )
#96 ( $3100 )……. #97 ( $4000)…..#98 ($3100) ….. #99 ( $20200)…..
so that’s $54, 494 in a little over a month……
if i were billing that every month , my gross sales would be $540K or so
and to the end of the year would be $654K
We generate that kind of sales by doing design, repairs, remodeling, roofing, painting, additions, and an occassional new house….. this is me , and two guys
and subs for everything other than laboring & carpentry…… sometimes we do the drywall, the paint, the roofing… we always do our own gutters and insulation
anyways…… i was wondering how everyone else runs their business… all in-house labor ? all subs ?
what does your office work amount to ?
i do the billing, estimating, design work, solicit sub bids and supervise the subs and our own crew
we have a part time bookeeper who usually bills me for about 6 hours /week
we have an accounting firm for our annual tax returns
and we have a payroll service that pays all our state & local payroll and files all our reports
i have a good crew that doesn’t need a lot of hands-on supervision… i’m usually the third carpenter … i show up and help out…. might be the cut man on the frame…
might take care of the one-man details while Roy & Chuck do the two-man stuff…. they’re on the job 8 hours… i might be on the job one hour…. or eight hours.. depending…..
how about you guys / girls ?
how is your company organized…. how long have you been doing what you do ?
we started in ’75……… me, my dog, my truck and one guy……. dog , truck & guy are all long gone
Replies
Mike. My business sounds similar to yours, except our revenues bite this year. Its me and a helper for general carpentry, and subs for everything else. We've only been in business for about 6 years though.
Hopefully i'll catch up with you soon.
Family.....They're always there when they need you.
i started about the same age as you .... i was 31 then
Bloomfield.... my family is from Rochester/ Pontiac/ Capac
one of my cousins builds Organs
http://www.wigtonpipeorgans.com/id1.html
Mike Hussein Smith Rhode Island : Design / Build / Repair / Restore
Edited 11/1/2008 5:58 pm ET by MikeSmith
I have avg of 3-4 employees, forklift and myself. Straight framing contractor I do sales, invoicing and stocklists. Wife does 401k and bills and have accountant do year end takes and weekly payroll. Have been in business 4 years and have done 500-600k in each of those years. I thought it would get easier as i went along but think this may be my worst year yet.
wow, dude... those are pretty heavy numbers for a framer..... or am i wrong ?
do you know how many frames you do in a year ?
Mike Hussein Smith Rhode Island : Design / Build / Repair / Restore
Edited 11/1/2008 6:43 pm ET by MikeSmith
couple other foibles ...
i keep a log of the invoices on top of a two ring binder... all the invoices use a 5-digit number
28000...
so the first invoice for 2008 would be 28001
the first invoice in 2009 will be 29001
all jobs go intheir own color coded folder.... 2008 jobs go in a yellow folder
2007 jobs went in a green folder
2006 went in a blue folder, etc
small jobs stay in folders.... bigger jobs graduate to 3-ring binders......the contract documents go in the foldr/binder along with every other piece of paper pertaining to the job
we use preprinted cardstock timecards... 8 1/2 x 5 1/2... after i report the hours to the payroll service ,they go on a two-ring binder... the bookkeeper logs the time to the job costing
and i use the timecards to do any T&M billing there may be.... usually for Change OrdersMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
Yeah we hit it pretty hard, we work about 50 or so hours a week all year and focus on high efficiancy. My four man crew with my forklift can frame as fast as the avg 6-8 man crew as I try to plan ahead. I think I could shave even more time off if I focused more at night prior to the work day, but as I get older I get more involved at home. I have my first baby due on the 9th. As far as number of jobs it has ranged 18 - 31 per year with the 18 year consisting of more larger jobs and the 31 year consiting of quite a few smaller jobs as i was trying to run with 7 employees which was driving me crazy as I couldn't keep them busy. I have always wondered what others take in but of course can't have that conversation with my local counterparts. When I first started out I was very organized and focused solely on work but as time passes I find myself becoming more and more complacent I just hope at some point i will refocus as so I can grow my business.
i got up to 5 guys for a couple years in the early 80's... but i spent too much time chasing my tail
then i had a couple years with empolyees that i couldn't trust....
took me a while to get my business working..
i think always trying to do quality work and finally figuring out that i had to price the job for quality in order to be able to deliver it on an ongoing basisMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
Cool, so hopefully if I can get through these next couple of years, i'll have a good future coming.
Family.....They're always there when they need you.
There's me.
But you knew that.
When I do more kitchens I might see the gross 150,000. Usually 100to120,000. I sub electric, plumbing, paint and sheetrock (unless small enough to not bother the finisher. I usually supply all the material on the job-very little supplied by the customer. Odd that the smaller the gross, usually the larger my wage. Markup takes a plunge tho.
This is all remodel-no additions-turn those down as I'm just not as strong and resilient anymore to do that alone.
Took a month this yr and worked on my daughters house and on this place. That means no income. Other than that it was a good year. January thus far is looking a might bleak. The upcoming medical break will be a zero dollar generator.....but the timing works out with the seasonal slow down T-day thru Christmas.
There could be some stunning photo's for sale this yr-for your holiday pleasure. Well, not yours-you'll take care of that yourself.
A Great Place for Information, Comraderie, and a Sucker Punch.
Remodeling Contractor just outside the Glass City.
http://www.quittintime.com/
cal....... you didn't tell me you were going to have a procedure...
hope all is well, whatever it is.... you know we're in your cornerMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
No big deal Mike-at least that's what I hear. Unblock the carotid arteries-no ream and clean but rather cut and remove.
####, got chills just typing it.
Nothing like a little excitement to break the monotony of a good life.A Great Place for Information, Comraderie, and a Sucker Punch.
Remodeling Contractor just outside the Glass City.
http://www.quittintime.com/
that would be 60 years of eating perogies, right ?
no doubt worth every one ....ok.... your basic piece of cake..
two of the 40 guys in our golf league had that done last spring... came back and lowered their handicaps from the previous yearso.... Dr. Smith says... prognosis ..... GREAT !Mike Hussein Smith Rhode Island : Design / Build / Repair / Restore
well... thinking about this....
sometimes customers wonder if they should be dealing with me... or dealing with the sub?my take is that even with 30 years of experience... my subs let me down now and then
i have to make it good... the contract is not between my customer and the sub... it is with me.. so i am only as good as my subsie.... i earn every bit of the markup we use on subcontract worki know in the last year.... my only loss has been where subs did not perform or comply well... gotta go.. off to play 18... then gotta get ready for the Pats / ColtsMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
the contract is not between my customer and the sub... it is with me.. so i am only as good as my subs
My answer to that is competition. My policy is if you mess it up you get one chance to make it right. If that doesn't work, I send another crew to fix it and you get backbilled. And since they are competitive to some degree, none of them want the others picking at their work. Since I've instituted that policy, my callbacks have all but disappeared. View Image
same story on subs. 90%have been great guys who WANT me to be the one interacting with customers so never a conflict there that I remember. had to straighten out one customer or two to make them understand that they have to talk with ME and NOT direct with subs, pointing out that the whole fabric of a house is woven together and that when they pull one string, the garment unravels.Used to do all my own roofs, but got to using subs for that a couple years ago, and that was a disappointing situation. Subpar work, and I eneded up finishing the job, a month before my heart procedure....
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!
Always an upside.A Great Place for Information, Comraderie, and a Sucker Punch.
Remodeling Contractor just outside the Glass City.
http://www.quittintime.com/
Hey Cal-
Best wishes on the upcoming "golf improvement procedure"! Hope you will still be able to harass the Star girls while you are recovering!!
Todd
Edited 11/2/2008 8:38 am ET by fred77
I plan on hopefully not getting fat. But I should be able to find something on the menu.
The man tells me there's a 2 wk recoop each side. I mentioned that when I broke my wrist I was off for the five days it took the swelling to go down and get it cast.................he wasn't impressed. We'll see, after the first side I'll have a better idea.
Bites for sure-the puny disability policy I have had for centuries doesn't kick in till 30 days off. Smart cookies those insurance companies. So, could be a might thin at Christmas.
Thanks for the thoughts.A Great Place for Information, Comraderie, and a Sucker Punch.
Remodeling Contractor just outside the Glass City.
http://www.quittintime.com/
What will they replace them with? PEX?;)mike - I started in '91 here with intention of doing a one man small jobs business.
As you know, '91 was not a very great year for the economy, so when I was offered a major remo, I took it. Ended up doing remos and mixed small jobs for the next ten years. Quarter million a year, doing all records and billing right out of my vehicle. Writing it up each night before leaving job while truck warmed up and it was fresh on my mind.
quarter million a year roughly. All substhen as my rep grew, so did the business. I landed a few design and whole house renovations and things doubled each year for three years.
It was running me instead of me running it. Then I got sick - had the heart procedure and the shoulder re-built, and lymnes disease all within about 7 months I had about three artisan sub carpenters and three employee carps through that time. Spent about 30-40% of my time managing and the rest working with the tool bags.I felt the need for a break and to stay away from another great big job that was waiting for me, so I turned it away tactfully, in favour of a couple smaller jobs that had me interested.
Problem is, I ended up with eight smaller jobs and learned that the management and overhead for those smaller jobs was almost as much work as for one large job times eight!!!And extra fuel costs to run back and forth to oversee and make decisions. I had good guys still that I could delegate too, but a lot of the kind of work I take is non-typical and I get it because of my creative eye and problem solver mindset. I do what others often say can't be done. Long story short - I got burned out with too much happening on top of health problems. The Lymnes disease left me with periods of mental fog and fibromyalgia. They both get worse with stress.So I had to make a conscious decision to cut back.I asked myself what do I like about this job and what do I not like? what things give me fulfillment?So starting last winter, ( I was already down to two guys) I told them that after this job, I will be doing nothing but design work and maybe a few select one man jobs. If anything big comes along, I will get the lead and referral to you guys, but start looking for your own work. I like my work day now - a lot. I work alone, always did like that, and get to do more creative work and people satisfaction that pumps my ego. I work 5-6 hours a day which is about what my body can handle anymore.Financially it has not been smooth. Takes a while to adjust things from a gross of 8-900K down to about 160K gross. A couple very slack months. Carole tells me the way I let the news out to the public came back to her in the grapevine that I was retiring. This at he same time the economy is going into a change.But recently I am getting more and more design calls. Some of them clearly stating that they will not build for a year or so because of the economy, but want the plans all ready to go when they do and things pick up again.Another thing that changes as you age - for the last two months, an average of one day a week has one or the other of us going to the doctor for tests or treatments of some sort.
Carole still shows clean of the cancer tho - whew!
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!
paul.... as you know.... anytime you guys want to come visit... we're readyon the design thing...
can you get the word out to your former competitors
that you will do design for them too ?
thats another thing i ree want to take this discussio to..
in-house design workMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
Yes, I'll design for anybody.That is also a slow go. For one thing, they are just now finishing or in the middle of jobs they had already booked and designed over a year ago. And probably with some of them, they need to see me stay out of the field for a couple years to be sure that I am not trying to use design as a way to steal their customers away and take the whole job.A lot of the work here comes through a couple of the caretakers who control several estates and the work on them. One of these guys I do not trust and would not want to be anywhere around him. I don't want his odor to rub off on me in any way. The other is not too bad. He just stopped by where I was fixing a sill two days ago, wanting me to work as consultant on a job where it is tricky getting permits - in that setback zone from shore.said sure thing - went yesterday morning to see the job. They have no plans but a sketch, and while they are only looking for a limited addy, I could immediately see a way to do more and improve a dozen things on the house, appearance, functionality, light, view, comfort, style, value added....by doing this a little different than they were imagining it. That is what an experienced pro is for - and at same time, I am up-selling the work from a $350 consult to about a three grand design job.I think in terms of a business discussion, that is a lesson everyone should know - upselling. Once you have the job, adding profits by upselling can be key to survival in a bad market.For instance, I have a wood door to replace because it is failing.
Upsell it to a better rot-proof jamb and adjustable thresh instead of just hanging door to a jamb. Oh, and one reason it failed is the harsh climate. How about a good storm/screen door to protect it and keep the wind and rain and insects out? For a couple extra hours work at a location where I am already setting up shop, I double the profits on it.
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!
Looks like I'm gonna hit awfully close to a million gross this year. My gross has been growing about 10% yearly no matter how I try to mess it up and I hit close to 900K last year. Just looked at the books and it appears I'm right on track.
We do some asphalt shingles and other roofing, but primarily copper roofs, gutters, flashings, chimney caps, etc.
I don't have employess, but I have 4 small sub crews that work on my jobs 90% of the time and one (shingle crew) that spends about half their time on my jobs. They don't require much supervision. I can get by with visiting their jobs twice a week max for big jobs and I usually combine visits with fabrication delivery.
I have an accountant that does my year end taxes. Other than that, I do all the office related stuff and fabricate pretty much every piece of metal those 5 crews install plus I do a lot of custom stuff for others. I do a couple of service calls about every week and every month or two, I do a bay roof or some other small job in the field 'cause I want to.
I just went back and looked. I've bent 43,000 lbs of copper so far this year.
I don't play golf. But most days I have so much fun I can't believe people pay me for this ####.
View Image
gee, those are big numbers... a million and the copper poundage
did it take you a long time to find subs that could deliver the quality you wanted without the supervision ?Mike Hussein Smith Rhode Island : Design / Build / Repair / Restore
those are big numbers...
Yeah - It kind of boggles my mind as well. We've done a lot of kynar coated terne roofs and several TCS box gutter jobs on top of the copper.
did it take you a long time to find subs that could deliver the quality you wanted without the supervision ?
For the most part, I've pushed them out of the nest so they could fly on their own. Usually when they do jobs for other people, they create fabrication work for me.
Dale and I worked together at the last real job either of us had. He took my job when I left, and after a year or so, followed me. We've been together 15-16 years with a little break here and there. We can finish each others sentences. Dale can email me pix from the job site if necessary, which cuts down on driving and speeds up the process in some cases.
Josh was part of that crew as well. He stayed at the old job and worked with me part time for a year or two before striking out on his own. We go back about 11-12 years.
The shingle crew is run by the son of a roofer I've flashed for for 10 years. The son is way better than the dad ever hoped to be.
I've got one guy that just flashes and does service call type stuff. He's a former competitor with a good skill set, but horrible business practices. He's got 15 years experience and is the step son of a metal guy. Been with me 2 years. I have to watch him a little closer. He'll fall back to his way vs. my way sometimes. I make him photo everything he does to get paid if I don't see it myself.
The other crew is fairly new. It's run by a guy that's come and gone numerous times. He's just bought a house and is looking for a little more stability in his life. We'll see. I watch him pretty closely at this point. He aims to please, but his skill set is lacking a little. He's getting proficient at emailing me pictures during the day if he has questions.
My strong suit is I sub to guys very similar to you. Most of my GC customers (which is the lion's share of my business) do mostly high end remodels/additions with the occasional new build. I often have the luxury of being the roof/gutter sub for all bidders on a project. So, consequently, I don't have to do much selling, just bidding. I pay most of my subs by unit pricing, with an occsional hourly job (T&M), which makes bidding a little less painful. I usually can price it without getting a price from them.
I have a lot of $100-$200 invoices, which helps cash flow, but creates a lot of paperwork and phone time for me.
My wife thinks I goof off all day long. View Image
"My wife thinks I goof off all day long."What does a lady banker DO anyways? count money? Talk to people? LOLDon't tell her I said that, I need a loan.;)
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!
I'll hit similar numbers to yours for the year. Spent the first 6+ months of the year finishing a custom home started last year, down now to smaller remodels, looks like I'll be less than f/t myself the last part of this year, which is a welcome change if it doesn't last too long. The market here has seen a rash of cancellation and wait-and-see since the Dow choked.
I'm glad to see your range of invoices. I do a few of those $135 jobs every year.
Generally have 1-2 guys and I do maybe 30 hours per week with my tools on. We do carpentry and sub everything else, although I will take a small tile job here and there and do it solo. I do all of the office work except for tax prep, which is done by a CPA. No payroll service, no bookkeeper.
No design/build except for the very rare small job. It has occurred to me to push that angle but I would need to quit all field work and (a) I don't want to do that, I like being an ace carpenter, and (b) it would be hard to find someone to take complete control of the field work, since I don't have 52 weeks of work for them... yet. And (c) I get some of my work from the few architects here, and I'm not sure what would happen if I am competing with them. Probably nothing...
Having the economy tank right now is disappointing. My business would be taking off. Been here 5 years and just getting a serious hold on it. Had a good custom home prospect but they need borrowed money and their working stiffs... just the type to wait and see.
What's your take on the next 1-2 years? We gonna see a resurgence or we gonna suffer a few years?
dave... don't you live on an island with a lot of weekend / vacation homes ?
i think the rich will get richer and the poor get poorer
i think vacation /retirement home areas like yours / mine will see turnover... and turnover means remodeling
with 300 million people the supply of desireable places to live is always shrinking interms of demand
some people will lose their money...but they will be replaced by someone else making itMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
We currently have 4 people. Down from a high last year of 7.
Last year we did 450k and it looks like this year will be around 325.
We have a part time receptionist type person who does a little book keeping, answers the phone and does misc office tasks. 8-16 hours a week based on business levels. She is retired and just does it for something to do, great phone voice, really glad to have her.
We do a lot of mid level bath remodels (30 last year and it looks like another 30+ this year) and mid level kitchens (6 last year and we are at 6 currently with no new ones in the offing).
We also do general repairs and interior remodeling, a few decks and some replacement windows. No new building to speak of.
I do sales, office, quotes, minor bookeeping ( accountant gets once a month totals to review, does taxes and payroll) parts running, in shop finishing and fabricating, and anything else that comes down the pipe. Since my motorcycle header I don't do a full day on a job much anymore. It seems I am now "fragile and arthritic" as my doctor referred to it.
We sub roofs, masonary and sometimes floor work. We do most anything else we handle. We occasionally wander off to some commercial stuff. Last year we converted and old bank to an accountants office and converted and old real estate office into a hair salon.
We are currently booking small jobs to fill in the empty time. Anything that will come in the door is handled immediately as I am trying to fill till Christmas (almost there!) but as Calvin said January isn't looking great at the moment. DanT
Mike,
interesting idea for a thread
I am not certain how relevant specific numbers are going to be----for example the actual $$ for a solid middle class lifestyle in Akron-might be very different than what is needed in Rhode Island, or Fla., or Iowa.
Basically, I focus on roofing and roofing related carpentry. I target jobs that are specifically a problem-a problem for the homeowner- or a problem for other contractors--- I see myself as being in the problem solving business.
I earn by one of 3 methods--work with my own hands, work with a small crew, work with subcontractors. some years-- in fact some DAYS I have earned by all 3.
By far I prefer work with my own hands because it has the best ratios of $$$ earned, mental and personality hassles, and free time.
I deliberately restrain my earnings--- I generally try to work 1000 hours/year or less---broken down as 300 hours overhead,700 hours hands on.
on 6-8-07 we had a hail storm--that has cewed my numbers for a couple of years
for 2008- I hired up to 5 workers as a maximum. I do not enjoy thinking for 5 people---but it does geberate $$$$$$
at one point this summer I had "misplaced" $3,000--money I had deposited into an account--but forgot to enter in the register--and didn't track down untill about 6 weeks later!
Make no mistake---you can generate some serious scratch if you line up roof after roof,after roof after roof and bust 6 sets of balls for weeks on end
but it is no fun--and it is NOT worth it.
I did it because i felt obligated to take care of my neighbors-----but I arranged things in order to not excessively profit from their misfortune
most of my neighbors were required to have work completed by 6-9-08
with a little overage I had things wrapped up by 7-2-08-------and that ended my need for 4 of the 5 employees
I did work with one laborer untill early oct.----and that is probably what i will do in 2009--work with myself and one laborer-- i find that life is MUCH less stressfull that way.
what I would say--is that the hardest--and most lucrative work we can do----is to spend time thinking--with a pencil and paper close at hand
laying on the couch with a pad and paper has often earned me more money on specific projects than I would have earned with a hammer in hand--- i have to THINK it through--and that is hard work
working with a tool belt on 2000 hours plus a year--would not allow me to think things through-- I am certain I would earn less
My most recent project-- I took about 1-1/2 square of cedar shingles of the front gable of a house.--pre-primed and installed cedar clap-----replaced a 5x8 window well roof and then 2 coats of paint. total in overhead and production was 32-1/2 hours and i earned more from that time than I earned many times with a 6 man crew--with zero stress
Next project-I believe-is going to be replacing 80 ft of ridge vent, 2 skylights and about 2-1/2 sq. of shingles--again zero stress and more money than I would earn with a crew.
both of these jobs come from strong referalls-- I intend to work this way next year--but probably with less total hours. I hope to work with one young helper--someone who is interested in learning first hand how to earn full time middle class money for part time work.
I am quite certain there are a lot of folks here on breaktime that can buy and sell me many times over--but i balance that out with having been able to send my kids to private schools--got to all their events, have plenty of time for bicycling,or running, or swimming laps, reading, thinking, vacations, woodworking, puppy trainingLOL etc.--
it's the whole balance in life
I would like to say---i have discussed things with Mike Smith here on breaktime off and on for probably 10 years now???--the results of those discussions-----further thought and research on my end--and then implementation- I am convinced Mike has helped net me AT LEAST an additional 6 figures in that time span
some of his ideas however ,I totally reject because they would negatively effect my free time,:>)
Best wishes,
stephen
Mike
We do remodeling and repair in a town of 9,000. We also work throughout the county, population 28,000. Our county is approximately the same size as RI where you have 3 million people. LOL
Most people here are traditional and conservative. Most every one I work for doesn't get a loan to do the project. So the sub prime stuff really doesn't apply to our work.
We are definitely not at the top of the food chain for contractors in our area. We do alot of little jobs that others are "too busy to look at". That's OK because I make more per hour than the guys building new homes. I bill at $40/hour and most guys are at $25.
I work in the field every day with my 2 sons, 22 and 26 years old. We rarely hire subs. I subbed out the masonry on a garage additiion this summer.
I like to focus on roofing in the spring and fall. I bid them fairly high and not worry about it if I don't get them. I avoid doing the big 2 story 12/12 tearoffs, it's just too hard to make money.
In the winter we do bathroom remodels, countertops and kitchens. We do our own drywall, taping, painting, plumbing, wiring.
Summer can be anything from siding to window replacement, decks, minor repairs, major repairs andsmall concrete jobs. One summer I felt like we did only rotten wood.
Year to date our gross is $203,000 and we will problably be at about $240,000 at the year end. Average invoice is about $1,200.
I do all the estimating, planning and billing. My wife does the bookkeeping and payroll. My SIL is a CPA and she does out quarterly reports and taxes.
We try to work 7AM to 5:30 with an hour off for noon M-F.
I usually do office work on Sat, evenings or for the 1st couple of hours in the morning. The older I get the less I like evening office work. Mind is too foggy. Tim has moved out of the house so I more freedom at night. For those of you who don't know who Tim is here is a thread. http://forums.taunton.com/tp-breaktime/messages?msg=96278.105
All three of us have rental properties so some weekends are spent on that. We have also taken 1 to 5 days off from other work to catch up on rental work.
I can't believe you hand deliver invoices. That feels awkward to me. Do you hand the invoice with one hand and expect the check with the other hand? That's what it feels like to me. I used to write alot of invoices in the driveway.
Now I do all my billing on the computer so that I have a digital record of hours and materials for future reference. All my thinking is now done on excel.
I mail or e-mail all my invoices. Most bid proposals and estimates are mailed or e-mailed. I prefer to e-mail if possible.
I had one job this summer, the lady called me about a commercial roof. I knew her deceased husband but i didn't know her. I e-mailed her a proposal and pictures. She e-mailed me the OK, I did the job, e-mailed her the invoice and she paid me. Still don't know what she looks like.
That's probably more than you wanted.
Rich
Edited 11/2/2008 12:58 pm ET by cargin
I think "Design/Build" is a great business model, IF you are good at both. I'm not.
I like to build, usually have higher standards than my customers, and am willing to recognize my shortcomings and try to minimze their impact on my business/life.
I keep trying to find an architect/designer to work with to keep better control of the project from the start, but it hasn't happened yet. I just don't think my people skills are adequate and it's a little late in the game to try to be something I'm not.
Only have a few years left that I need billable hours. After that, we plan to build on, or sell off our real estate and call it a career.
Carpentry continues to challenge and engage me on a daily basis. I'm lucky to have found it so early in life and glad I stayed with it. I'll leave the design work to those who wake up thinking about it, go to sleep thinking about it - that's the way I am with carpentry.
I have just finished my first full year in business.
We started as a union signatory company in southern Illinois. Had an architect that believed in my potential and hired us as general contractor / project manager for a million dollar job. The job lasted four months before developer ran out of money, and told me my services were no longer needed. He owed my around 10K at this point, and has paid me about 200.00 per week since mid February. The bank took over the project with other contractors than those of us that were there. When I left the project was a little over half complete.
I sat home for about two weeks and a friend called wanting to build a house. We jumped right on that. Got a call for a room addition from a buddy who does drywall finishing and needed a framer and trim guy for the job. I was general contractor, hired him on as helper and he did his finisihng/painting on a different contract.
Dropped the union in the middle of that job. Things were slow until mid July, but me and 1 helper were keeping busy.
We have done everything imaginable since July. I made a few contacts with some land lord types who just assume pay to get houses ready as do it themselves. We are now in property management and maintenance along with everything else.
By the end of the first full year in business we had done 600K total. I have about 100k of work lined up right now, and just a few weeks ago I was gonna build pole barns to make ends meet.
Been a crazy ride this year. Don't know if it gets better as time goes on or not. I currently have me and three people, hope to keep it this way. I think aiming for 500K a year is not dreaming, but will settle for 200k with me and a helper.
I have learned many things this year from doing the hands on business, and from reading more intently the business discussions on here.
My fiancee and children are very supportive of me in the slow months and don't try to take advantage when I have a good month.
Don't know if I answered your question but I sure typed a bunch.October 17th, 2009
Jeremy and Lisa
Was there ever any doubt?
"I'll leave the design work to those who wake up thinking about it, go to sleep thinking about it - that's the way I am with carpentry."That is a great way to put it into words, Jim.
I would lay awake 'till midnight a lot with architects plans after a comment from an owner about how they didn't like some feature or wish the archy could have fit in such and such...trying to come up with a way to make it better and suit the customer. I came up with the right solution often enough (sometimes waking myself up with the creative flash in the middle of the night) that I get to do the original design work myself now. I remember drawing layouts and floorplans all the way back to when I was about eleven years old - for fun! Never really did think of myself as a carpenter. I just like working with my hands as much as possible too.
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!
Mike,
We perform all Carpentry & Labor, Painting & Finishing, occasional Sheetrock/insulation.
We have 7 in the field, myself in the office and a part time "office manager" We do our own payroll and filings except the end of year.
The guys get health insurance, a matching 401k, and a monthly gas/cell-phone re-imbursement curretnly at $230.00 month.
I do very very little actual hand's on work anymore. I'll pick certain parts of a project I want to work on, typically a custom cabinet or something out of the ordinary.
We should do around 1 million this year, company has been in business since 81, I've been with the company for 8 years now. We are 90% residential remodel.
cag.... sounds like a real business.... mine is only approaching a real business
i think someone defined a real business as one where you could take a cruise around the world... come back a year later
and everything would be functioning as good as, or better than when you left
i think the phrase was.... wether you own a business, or it owns you
does your owner participate on a daily basis ? Mike Hussein Smith Rhode Island : Design / Build / Repair / Restore
Mike,
No the owner does not particapate on a daily basis, or at least he hasn't in the last year or so.
so.... by that previous definition..... he OWNS a real business
and i guess you're the CEO.... congrats.... and keep on truckinMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
Mike,
Interesting thread. I like the discussion.
I don't have much more to add than everyone else has said but we do sub out most of our work due to state regulations. Most subs need a separate license so its easier for us just to work with other licensed subs.
We do some of our own clean up, general labor and stuff but thats about it. The year was really slow until around August when we got two big jobs that set us up for the rest of 08.
But I too feel like I couldn't be away longer than a few days without nothing getting done.
Mike
Started full time in construction, working for my dad in 73...started on my own remodeling around 1983, which I have done in Wyoming and Iowa up till almost 3 yrs ago.
I bounced around from 1 man and up to 4 man including myself. Last few yrs averaged about $250,000 doing anywhere from 2 jobs to 20 jobs per yr.
Last 2 yrs, I had a part time bookkeeper and did everything else myself, finally burned out and made some poor decisions
Got an offer from a local top 500 and Big 50 remodeler and decided to try it out for awhile. We do restoration and full service remodeling.
Last yr we hit close to 3.5 million doing 82 jobs. the company has a part time CPA, the owner, 3 office staff, 2 salesmen, production manager, 6 project managers and 6 helpers of various skills.
We are a mixture of in house and subs. payroll is in house
The transition from self employed to employed has been difficult at times.
Don't know if this was the type of input you were looking for but there it is
barry... it's all good... and it's all interesting..
i think one of the great things is we can share this multitude of experience
when i started i joined RIBA and went to all the monthly meetings... just listening to the old guys was helpful.... but they were not into sharing a lot with their competition
i went to lots of seminars... judd motsenbacker.... walt stoeppleworth....
irv carson (?) ( PROOF MANAGEMENT )
learned a lot
but i gotta tell you the 9 or so years i've been hanging out here are mind boggling in the give and take of information..
it even makes putting up with the polijive okMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
>>even makes putting up with the polijive ok
When they made the Tavern optional, I opted out. Made a huge improvement, for me at least.
"it even makes putting up with the polijive ok"you said a mouthful. :)I'm guessing RIBA is like our Remodelors Council? Or is it mostly builders?I have been in our remodelors council for 9+ yrs. it may be atypical but we have a very close group and some great mentors. We have heard that is not always the case with the HBA with which we are associated. Maybe it's a different mentality. I know that I would rather bid against fellow council members then those who are not membersI've listened to Judd and Walt many times, as well as some of the other top remodelers around the country. I remember going to a Hometech talk at the local Holiday Inn many years ago. Sure opened my eyes. We just put on a remodelors road show at our local, signed up 10 new members. The speakers were Alan Hansbury and Vince Butler. Lonny Rutherford, the current national chair was also there. It was a great 2 days.I think you mean Irv Chasen? I believe he was a painter like I started, which is why I remember himI just wish the internet and places like breaktime had been around when I first started
Â
Edited 11/2/2008 8:24 pm by BarryE
My business owns me for sure, but we have been at it for a few years. We grossed about $450k in 07, and look to do a little less in 08. But I had three more guys in 07. I'm happy, and solvent, but don't get paid regularly.I do all the estimating, billing, sub management, material acquisition and planning, payroll, taxes, and bookeeping. Very low overhead.My brother builds stuff. I play w/ LV wiring and funky details. It works ok, but we need to get through jobs a little quicker, so I am exploring using drywall/paint subs on the current project.Breaktime has been a treasure trove of help along the way for sure!
better....
<<<<<I'm happy, and solvent, but don't get paid regularly.>>>>>i used to be in the same boat... only worse... i fit the definition of bankrupt...we were really floating my business on my customers
and our personal expenditures on my wifes paychecki was always the last one paidif that was a big corporation.... the ceo would be the first one paidi wrestled with it and came to a couple of decisions:1... i was the most valuable employee we had
2.....nothing happened if i left
3... i should be the first one paid, not the last
4.... evryone ... me... the guys... the subs... the vendors... all have to be paid
5....in remodeling... you can't really ratchet up the efficiency to squeezae more out of teh stone...ie: it was not so much that we were inefficient... there was something else wrong
PRICING...
we had to price for a profit and to make a profit... we had to know our costs6.... our costs have nothing to do with a "competitor's price"if i had been doing this for 15 years and my pricing didn't generate a profit... what made me think that my competition was basing their pricing on cost ?couple things:
i incorporated
i got a payroll service
i hired a new ceo ... me
i determined thaqt i had to pay him for his time or he would leave and go work for someone elsei pay myself for 80 hours EVERY WEEK
i pay my guys what they workif there is no money to meet payroll because of a bad cash flow..... the OWNER of the corporation ( me ) loans the corporation money so it can meet it's payrollthe CEO has to get paidthis might seem like a shell game.... but it's the discipline i need to make sure i continue to price for a profit
15 years of paying myself last convinced me that was the wrong business modelnow i have 15 years of paying myself first and my 1040's are always where they should beMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
1... i was the most valuable employee we had2.....nothing happened if i left3... i should be the first one paid, not the last4.... evryone ... me... the guys... the subs... the vendors... all have to be paid5....in remodeling... you can't really ratchet up the efficiency to squeezae more out of teh stone...ie: it was not so much that we were inefficient... there was something else wrongPRICING...we had to price for a profit and to make a profit... we had to know our costs
6.... our costs have nothing to do with a "competitor's price"
I'm finally figuring this all out.
i pay myself for 80 hours EVERY WEEKi pay my guys what they work
if there is no money to meet payroll because of a bad cash flow..... the OWNER of the corporation ( me ) loans the corporation money so it can meet it's payroll
Good Plan. View Image
Mike,
i think I got here in about '98 and you were already here
(along I think with blue, Jeff Buck, and Pete--possibly boss hogg as well)the guy with the proof system????? I think he was a plumbing or painting contractor-- I believe I first read about that sytem in a roofing contracting magazine
My perverted application of the Proof system has made a world of difference because it clearly gave me a roadmap of HOW to get where I wanted to go. The late '90's early 2000's here in the business folder had such a cauldron of info and ideas churning about--it was un-imaginably helpfull. Ever have the experience where you learn a new word----and then suddenly everywhere you turn,THERE is that word---TV,Radio,Newspapers,Magazines?????Or have the experience where someone mentions a topic that interests you--and while researching that topic it leads you to something even more important???? I had that here in the late 90's---early 2000's countless times one thing spefically--- I think one time you mentioned Warren Buffet and BRK.--- I had never heard of Buffet at that time---but looked into it.-Eventually read a couple bio's( in fact I just finished the most recent Bio by Alice Schroeder)just so many good ideas there----like the correctness of an idea is independent of it's popularity. I think how i work is probably wrong for 99% of folks-- but it is spot on for me.Recently- I read where Buffet was asked to describe the perfect business.-- in the past he had talked about things like a "moat"--that is ---a tremendous brand like COKE--that would be impossibly expensive for a new competitor to duplicate but this time he mentioned money--the perfect business is one which requires a lot of capital invested at a high rate of return and which allows the profits to be re-invested at the same rate of returnso----you have a business with 1,000,000 invested earning 20%---can you re-invest that money so that next year you have $1,200,000 invested at 20% and so on. If the business can NOT handle that re-investment you have to strip that money out and re-invest it elswhere In this folder, Blue has often talked about what a bad business construction is------there is no moat-anybody with a hammer and a pickup can enter it---and it doesn't handle investments of money efficiently--- that's true
but it does generate money--it's how we handle it that is the problem.
As I mentioned earlier--this spring I did a buttload of work March, April,May,June. It is not a life for me- I don't enjoy having and motivating 4 or 5 or 6 employees--and i didn't do it for the money--quite the contrary
but I learned something---if money is your goal---in this area IF you can line up roof,after roof after roof after roof--it would be perfectly feasible to earn over that $250,000 a year that " Joe the Plumber" was whining about.
It would be perfectly feasible--but extremely unpleasant---it would not be a life for me Cargin mentioned some specific numbers---and i much admidt I am a little envious of him working with his sons( although I consciously steered my sons into other opportunities -----this year I had one friend of the family work with me who is like a son to me--in fact several of the customers THOUGHT he was my son)----working at Cargins' numbers wouldn't allow me to stay afloat here----and someone on Long Island I suppose couldn't keep their doors open working at my rates------so---although I am always interested to see rates from around the country- I don't know specifically how helpfull it is
Best wishes,all,
stephen
stephen....good post.... the absolute rates are very locus speific... but how the rates are arrived at are the keycouple good sources are missing... sonny forever...
but gerrald is missing tooyes the proof guy was a PAINTING contractor... a huge eye opener for me
he and stoeppleworth allowed me to find out what real-life rates had to be for my business to succeedMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
"couple good sources are missing... sonny forever...
but gerrald is missing too"Reminds me ..when I first entered the internet zone about 10 yrs ago one of the first places I found besides FHB was the Remodeling forums. In the early days it had the best business discussions around. I learned much there because of guys like Sonny, Jerrald, Peter Bush and the many others who posted there.I think the numbers alone may not mean much, but benchmarks found in the numbers kind be a help....and besides it's interesting to see where everyone is coming fromand IRV CHASEN WAS A PAINTER!
Barry E-Remodeler
sometimes i lament the braincells i've misplacedhow could i forget irv chasen ?Mike Hussein Smith Rhode Island : Design / Build / Repair / Restore
jerrald is a little to smart for me to quite figure out what he is sayingSonny----well let's just say that I implement ideas that I stole from sonny almost every week----but he also had ideas that I deliberately do NOT do--because they are wrong for me-------might be right for somebody else though. the Proof system---we really can't emphasize that enough. I really couldn't due what I do without my own perversion of that system.
with it I know WHAT I want to earn in a given year, I know how many hours I am going to work and so I know how much I need to earn per hour------It's so elegant in it's simplicity-because once that rate is determined it allows you to FOCUS----and to weed out all sorts of work classifications that won't generate the desired return.
It gets easier and easier---beccause focussing on the rate of return makes me more efficient
gotta run,
stephen
First year of business, small carpentry company, Argyris & Clinkard Carpentry, located in Toronto Ontario. We did 60g of business in our first summer of business (We also have full time jobs with a contractor as his two carps) Lead carp, my partner is tired of low paid life, and we are learning the business together. It is nice to have full time jobs right now because we have only a few jobs on the horizon and it is dead right now, as opposed to the summer of every night and weekend. We do mostly trim, both interior and exterior, with decks and windows and doors sprinkled in. So far we have worked for one contractor (other than our full-time employer but mostly through homeowners, we are sort of looking/making our niche as we are not big enough to trim out houses (3000sq +) efficiently. I try and focus on high quality work and excellent customer relations, if someone isn't happy with anything we do I will go back and change it (free labor).
I started reading back issues of Fine Homebuilding when I was 16, stopped when I went to university. Finished university, then figured it wasn't for me and found out about Breaktime. I put the same amount of trust in your guys (piff,boss,mike,gene,frenchy etc) as I do in my hammer. (Estwing 24oz)
I find I spend more time on Breaktime than I do with the magazine as I have found that as time goes by the magazine gets fluffier and more info is found here. Thanks guys.
Stephen
I mentioned specific numbers because it is something I can rarely do in the lumberyard or the coffeeshop ( trust me I spend any time there). It's strange that we can be honest and open with strangers. Even though some of these BT guys have become friends.
I have had my house paid off for 10 years, but my wife doesn't work outside of the house. I try to keep overhead low.
I know rates are very geographically specific, but if it helps someone else in the rural areas to get a grasp on why they are struggling to make it on their current rates, then so be it.
I know I and others have been helped by many of the conversations here in the business folder.
I have less trouble with my rates at $40/ hour than I used to have when I charged $12/hour.
Rich
Cargin- i think it's cool that you would share those figures.
In the past I was more open to mentioning specific figures for much the same reasons-- i figured it might help someone in a similar situation NOW, however-- I feel maybe it might be counter productive----- I see people ask"what's the going rate for XYZ?"----and it seems people are looking for a shortcut instead of doing the very hard work of tra cking their numbers etc.
congrats BTW on the house. I had much the same experience with education costs. I payed private school tuition for 2 sons grade school,highschool,college for 17 years---with that about wrapped up it's a whole new financial world isn't it?
stephen
Stephen
I see people ask"what's the going rate for XYZ?"----and it seems people are looking for a shortcut instead of doing the very hard work of tra cking their numbers
I think you are right. But I know there are guys on the board that don't have a clue what they are doing in estimating and charging for their costs.
I am just a step ahead of them.
Roofing is the easiest thing for me to estimate and one of the few areas that I can bid a job and make some profit. Plus there are limited numbers of color choices and you don't have to match the HO's wallpaper. With most remodeling it's tough to see the hidden costs and to bid the job with a lot of margin.
I really don't have a clue what the other contractors in the area are charging. It's not a conversation that comes around too often.
After being a part of the conversations here on BT, I am caring less and less what they are charging. But I do know one of the biggest contractors in town doesn't markup materials at all.
About 10 years ago our lumberyard held a seminar where the speaker encouraged us to mark up materials and labor by 50%. Most guys thought he was nuts, or trying to sell us the Brooklyn Bridge.
I didn't want my boys to go into this trade either. Both were very delayed readers. Book learning was very hard for them. College wasn't even an option in their minds, so here we are.
Rich
cargin--you have always seemed like a solid guy---so I am glad we didn't end up in some sort of argument,LOL. It would be easy to quibble over semantics though.- I don't mark up materials either Using the PROOF system mike and I have mentioned,---profit,overhead etc. are captured through the labor rate.--the labor rate is never revealed to the customer,however,---nor is the material cost----just the bottom line figure so---we both might sell the same job for a bottom line figure of $5000-----you marked up your materials and I didn't------but it is in their all the same---we just took different paths to the same number. I am hesitant to mention specific numbers--because of an experience i had several years ago. I was participating in another forum--one aimed at roofers. A discussion came up about"what's the going rate per square?"
most of the guys wer mentioning a "going rate" in the low to mid $200's per squareI don't sell"per Square"--but I pulled out my files for the next 4 or 5 jobs I had scheduled--some quick math--and my selling price at that time was in the high $300's to mid $400's per square WELL!--the other guys on the forum essentially called me a lieing sack of dog turds---it was absolutely incomprehensible to them that somewhere someone was getting that rate( and I am by NO means the highest here in this area)---since they weren't doing it--in their mind i must be lieing
But-- I suppose if i went to Long Island and sold at those rates i would be undercutting the market--and possibly not even breaking even on my costs----and If I went to YOUR area with those rates-- I might not be able to sell a thing
so--that's when I figured that numbers on the internet don't mean much Regaurding sons---- if either of mine was interested in this I would have taken them on and encouraged them in a heartbeat-- our pricing would be different as well I am sure.
the oldest one has always done well in school--it is perhaps to easy for him--so college was a given for him the youngest has always struggled in school-ALWAYS
ironically-he started college fall 'o7--and had academically the best semester of his life----GPA higher than his more academically accomplished brother---but it fell apart for him in the spring semester.---as he told me later--in the fall he was simply cruising on everything drilled into him in 13 years of catholic school--he didn't have to work at all----- in the spring he tried the same----but by the time he realized he was gonna have to apply himself things had gotten away from him and it was to late.
Plus-he didn't tell us when we could have helped him with advice to drop the 2 worst classes and salvage something from the other 3so-crash and burn,LOL
upside is--he started working in MAY with my neighbor who is a landscape contractor---he loves earning money-and he doesn't spend it. He will collect 2-3-4 weeks of paychecks--and then deposit them all--next week he will cash a paycheck--and that will last him 3-4 weeks---so he is saving 75-80 % of his pay. He likes working in an enviornment where he can tell he has made a difference and things are better because he was there at the end of the day. He has also told me" I don't want to wake up one day and find out i am 30 years old and just like C.(his foreman) He says he is thinking of going to a local stat technical college next september and taking a 2 year course in electrical training. If i THOUGHT he was actually interested in that i would be happy--but I suspect he is maybe just telling me what he thinks I want to hear
At any rate he is working like a dog and saving tons of $$$---- if he goes he already has saved the money for his first year---and buy next summer he would have BOTH years paid for before he even started. what the heck IS it with these kids today---they won't do what we KNOW is best for them,LOL--were we any different????Best wishes to you,
Stephen
Stephen
Was I supposed to get offended? LOL
I don't go there. If a thead isn't going the way I like, then I just check out. Life is too short to get mad at the some internet guy. You could be little old lady in NJ with a big imagination for all I know. LOL
I come here to learn, share if I have the knowledge and have friendships.
The Proof system sounds interesting.
I don't give the customer a per/sq. I give them Labor, Materials and Landfill.
A discussion came up about"what's the going rate per square?"most of the guys wer mentioning a "going rate"
Every roof is unique so in my mind there is not such a thing as a "going rate."
the youngest has always struggled in school-ALWAYSironically-he started college fall 'o7--and had academically the best semester of his life----
That was me. I was a B, C or D student in high school. 1st two years of college I was on the party floor. Ususally only 1 or 2 guys came back for the 2nd year. I got good to average grades. Last two years I got all As or Bs.
Problem was I didn't have a goal. I was just going to school to get a liberal arts education.
If a kid is going to go to college today he needs to understand the value of a dollar and a hard day's work. Both will motivate you to get better grades and get an education that is marketable.
Both of my sons invested heavily in the Roth IRAs between 18-22. A guy really has a leg up if he can get a healthy mutual fund and IRA funded before he has to go out on his own.
what the heck IS it with these kids today---they won't do what we KNOW is best for them,LOL--were we any different????
My brother and I were talking about that the other day. We wish our Dad would have taken a more active role in guiding our early years. My Dad was a hard case and I was a young hippie type. I probably wouldn't have recieved it from him. I am the poorer for it.
Here are some of the numbers per sq for roof jobs I did this spring and fall.
$498, $346, $338, $545, $273
Made nice money on the $273/sq roof. Tear off was easy and the shingling went fast.
Andybuildz (Long Island) mentioned a house he hopes to get a 500K remodel this winter. The house sold for 900K. From the picture that house would sell for 150-200K if it was in move in condition.
Numbers only mean so much.
Sorry for rambling.
Rich
Mike,
I started working full time as a carpenter, in '86. Worked for a local contractor, who did new homes and light commercial building. He also was a developer. Did a nice residential area, with a multi family, higher end duplex, 4 plex, 6 plex grouping next to it. We also built the first assisted living center, in the area, and he owned that also.
Left that job after about 2 1/2 years, to work for the "best" local builder. Started with him on an addition to a local Best Western motel. We also did remodeling, and new homes. I spent 13 years working with him. The last project I was on was a pair of lake cottages, for 2 sisters. The total cost between the 2 was about 6 million.
Went out on my own in 2001. Been at it since.
I generally work alone, but at times have had 1 other carpenter as an employee. After the untimely death of my last carpenter, a year ago, it has just been me.
On average, I do about 250K a year gross. This year would be the big exception. After taking some time off to heal an injury, I came back, just as the economy folded. Not much work around here.
Usually, I do large renovations, new homes, and custom millwork. Lately, mostly handyman type work. I do all carpentry,most foundations, some masonry,insulation and more recently some paint and stain. I sub out electrical, plumbing, HVAC, and drywall.
Currently, I am getting ready, to venture into some developement, or re-developement. We are going to try a spec rehab job this winter.
Hope next year brings brighter prospects to us all.
Brudoggie
amen, brother bruMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
mike,I love your approach about paying your self for 80 hrs a week, then loaning back the money if needed. It keeps you on your toes, because who wants to loan it back. So you try to make sure everything is covered. Would be tough for a 1 man show like me to do, but for those with a few employees, its a great strategy.Right now, I'm working to cover overhead, but not making much personally. Pretty tough with a day here, a couple there. I'm not built psychologically for that. Way too much mobilization, and book work. Seems I'm most comfortable with jobs in the 1-6 month range. Long enough to get in the groove. But not so long to burn me out.My last large job was a commercial historical restoration. We were almost there a year, and high pressure to get it open, plus the usual budget pressures of a startup business. Oh, and everything had to be "perfect", in a 100+ year old building. That one kind of burnt me out!I did learn though, during my off time this year, that I'm not cut out for retirement. I can't stand to sit still.Brudoggie
Mike,
Can you give me an idea of where to find more on the proof system you are talkingn about. I am quite comfortable with my pricing but always checking to see if I am really making money or just wages.
I was in the local yard the other day talking with one of the older contractors around here. He asked what I charged per hour. I told him that if I was working on a cost plus job I bill me out at around $40.00 per hour, he called me a liar and asked what cost plus meant.
This guy gets lots of work, but I have never thought of him as a money maker. I believe my old boss around here is priced highewr then me.
I don't think numbers on the internet mean much, and neither do numbers from a lumber yard. He says any more then $25.00 per hour and I 'll never work around here.
October 17th, 2009
Jeremy and Lisa
Was there ever any doubt?
Jeremy... congrats on your upcomming wedding you can google on proof management systemor... try Jerrald Hayes... he as some great worksheets.. here's a link to one of his discussions http://forums.taunton.com/tp-breaktime/messages?msg=112091.26
Mike Hussein Smith Rhode Island : Design / Build / Repair / Restore
along the line of General Business...
every once in a while i get to thinking i'm carrying too much overhead
and of course i start to think about getting rid of someone and wearing that hat too
like the part time bookeeper....
except .. like last week... he sent me an aging report that gave me a heads up that i hadn't received a substantial payment for Extra Work that i had forgotten about
turns out i was waiting for a bill from the elctrician that never came... so i had delayed sending the first part which was the plumber's bill.... in other words i had an incomplete invoice that i had never mailed out
without the bookeeper ( or some other bookeeping system ) i would have lost $2300 and never even known it.......
you may rightly ask.. how could this possibly happen ?... but really... it's easy unless you have a good book keeping system , stuff like this can happen all the time
so... i think i'll hang on to the part time bookeeper... i got enough hatsMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
Mike
I am alot smaller than you and it is easy to let small invoices slip away from you, especially if the job is a series of small jobs over a period of time.
Rich
We get pif for all AWA's in advance!
Crack that whip Mike!!
eric.... you speaking in tongues again ?
wanna gimme a crip note on what you just said ?Mike Hussein Smith Rhode Island : Design / Build / Repair / Restore
We
get
paid
in
full
for
all
Adittional
Work
Authorizations
in
advance
!
rich.... the amazing thing is that all these slip ups go straight to the bottom line.... lose an invoice and it really snowballsMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
"the amazing thing is that all these slip ups go straight to the bottom line"Yeah, that's sobering all right.Let's say you do $500k per year and shoot for 10% net profit. If you miss invoices that total $5k or are optimistic when estimating and undershoot $5k over the year you decrease your profit by 10%.Something to think about when a customer asks you to lower your price. The leverage of a 1% concession can be 10x as significant to your profit margin. They get a little break and you get a chunk taken out.
Jon Blakemore RappahannockINC.com Fredericksburg, VA
a similar thing... say you have a $5000 job.... and you neglect to charge a $500 invoice from your lumber yard
the job can look profitable... but actually be a loser
we have to have systems like dave was talking about to protect all the selling, estimating, labor and supervisionMike Hussein Smith Rhode Island : Design / Build / Repair / Restore
don't feel bad mike--
this past summer I temporarily "lost" some $3,000 plus that I had actually collected AND deposited----- i didn't make the proper notation andforgot which account it went intothis was during a period when checks were coming in and going out by the wheelbarrowfull---and about 3 weeks later I thought" hey-what happened to that money from Barbies job?
stephen
jon-that lesson was hammered home to me a few years ago at a roofing seminarthe question being was it feasible to cut your price a bit and make up for it in increased sales-----------
Slide show went on to show step by step how cutting the price---came straight out of your profits-----and that it was almost impossible to increase sales enough to get back to the same dollar amount of profit however-it WAS perfectly possible to RAISE your prices,do LESS work and make MORE money--which was a valuable bit of technique for me to pick up!!!
stephen
The minute I am owed a penny, or even think that I will be, I create an invoice showing the projected amount due. That way it shows up on my collection reports, and on my balance sheet as A/R.