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I figure someone out here has some wisdom for me about my potentially divergent paths. I’ve been working for a small design/build remodeling firm for about 6 yrs. I’ve worked my way up to being the senior field employee. Last year I produced about 330k of work. One of my co-workers and I have been planning to start our own similar business. I approached my present boss about buying part of his company, admittedly holding my going off to be a competitor over his head. He responded with an offer to give me more autonomy over the jobs I run, two employees to always stay with me, and a supply of higher end remodeling, but he won’t sell me part of his company. However he is willing to split the net profits 50/50 with me, on the work I run with my (his) two employees. He thinks I can produce 500 to 600k of work a year with 2 guys. (the 330K I did last year with about 3/4’s of a helper.) So, is this too good to be true? I would keep my present wage and benefits, and get half the profits without any capital risk, general business responsibilities (beyond production) or selling. In my mind, it makes the patnership with my co-worker appear much riskier for similar rewards (in dollars at least.) I know this has been long winded. Thanks for bearing with me.
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Try it...It ain't gonna kill ya....
Near the stream seeing more and more interesting partner-ings,
aj
*i like it ..... sounds like your boss likes it... and if you think about it.. sounds like it could become his ultimate exit strategy .. if it works out.....now... about the co-worker...is he as good as you ?..will he feel betrayed ? can the organization hang onto him also ?
*Ray,What do you have to lose?This sounds like a great offer if your boss comes through. You are right about no risk , and you have everything to gain. A chance to make more money for being productive and hands on business experience.I would get everything in writing.Good luck,Mark
*I agree with Mark. Besides, having known quite a few guys (myself included) who have formed partnerships, I can say they are difficult and many times end up split, with many hard feelings all around. Think marriage and you'll get the picture.
*I can see the appeal of this arrangement, for both parties, but I can see real problems too. Like, if a job goes bad, and loses money, was it bid too low, or did you fail to hold up your end in the field? From the employer's point of view, why should he split profits, if he assumes all the risk? It seems to me that there has to be the same amount of risk/reward/responsibility for each partner for partnerships to work. I'm not sayin' it can't work. I'm just sayin' the two of you will have to have a super relationship as far as trust and communications go.
*Hi Ray, Senior field employee, hmm. Are you the "juice"on these jobs? That is, are you the guy in charge?The boss. You know, the one person that nobody wants to hear say "uh oh!" And do you effectively run the job? Sure, for the most part. So for the sake of argument, but for a few aspects of working, you're in essence running a business. A healthy and profitable enterprise to which your life blood islinked. So far, so good? Now you've made known to the owner that you, his senior field employee, are entertaining the idea of becoming his competition. And going partners with a co worker no less. Again, some one who is reasonably competent and an asset to the company. And tomorrow is the first day of spring. And the work has been outlined with contractual obligations and schedulesand so forth. Oh yea, can you buy part of the business; my guess being the sunk cost of tools and equipment. Now you've been offered a bonus. Orally, without terms. And your job will be easier because there'll be more help at your disposal. And that co worker,you know, the prospective partner in the originaloffer, where's he in this? Let's not forget the promise of autonomy. More autonomy and better work,(as in hi end}. That sounds good, sure. So, just for stayin' on board things are gonna be better all the way around. An easier job and a slice o' the profits.Wait a second, that sounds "too good to be true!" Divergent path. Senior Field Employee. Holding it over his head. He'll split net profits. By the time you read this you'll either be self employed, unemployed or have gotten a raise. Or whatever. Your approach is not good. Why, because youv've undermined your own good standing in the company. Being in business involves bargaining in good faith. Doing business is a mutual agreement. Even as an employee you are conducting the business of your company. The business owner can't concern himself with what you think, or what you may do. Its your actions that count. And its your choice and are you going to choose to act on your intention of starting a competitive enterprise? You've cast yourself in a different light now.Will things be the same? How will they change? Profits, hmm, what about that? Regards, Dan-O
*Ray...Don't listen to Danny boy....He's got a bug in his pipe somehow...Give it a whirl Ray...near the stream,ajI see only one problem...Your boss may say the jobs are not making a profit or making less than you think...Are you gonna share the spreadsheets and estimates and contracts and all the related info?
*Thanks jack. I wasn't sure where danny is going. I'm going to have to reread what he said. It seems like he might have been on the other end of something like this. My boss already shares all the data with me. He's almost irrationally open about the numbers end of things. I might add that he is by far the best person I've ever worked for, and probably one of the most trust-worthy people I've encountered. I'd meant to put that in my original post. Not that he couldn't change, or that I'm blinded by his supposed honesty. I'm a fairly sharp guy. Thanks for your encouragement.
*Just be sure it is in writing with escape clauses that you both agree to. One good test of how good this deal is whether y'all can set your agreement down on paper. If you can do that looks to me like you have a new, and better, status and relationship in the company.
*Now that's the kind of wisdom I was hoping for. I'm not a get it in writing kind of guy, so I should look out for that. Thaks for looking out for me.
*A reply to Dan O.Wow. Dan-O you certainly are hard on me. Not that I didn't ask for it. Thanks for your candor. I'll try to clear a few things up, and ask you a few questions. I told my employer for my intentions 4 months ago. He's just gotten back to me with this proposal. I can be a patient person. I'm not certain how I've acted in bad faith as an employee. Docile I'm not. Is that a good employee? I'm just trying to leverage what I bring to the company go get what we all want just a little more of recognition, respect, remuneration. Your boss, or you if you are a boss, leverage the skills of those who work for you everyday to gain those things for yourself. What's wrong with me doing it. It only seems fair. Ideally it seems to me that the person who produces the work should share in the profits from it. Who's really content making $15 an hour when your boss makes $100k. I did think a little more about capital risk, and realized I'm already incurring some. The company I work for owns very little equipment. Easily I own 95% or more of the trucks, tools and equipment we use daily. I've tied up a substantial sum in this, and it is committed whether I work or not. Regards,Ray
*Really put yourself in your bosses shoes. Would you offer the same package? I think what he is offering is pretty close to absurdly generous. If you don't take the deal uh, maybe you could put in a good word for me.
*Hi Ray, No bug in my pipe. Just straight foward feedback on the available info. Would you want any less? Of course not. And no one is going to spend the time composing a response and posting it if it had no basis. Now you've talked about the boss. To your good fortune there exists a genuine relationship between you. That can't be overlooked and its important. Yourexclusion of this pertinent info got you my initial response; harsh but fair. Much of my initial post is a re hash of what you say. Even to the extent of re writing your words.This is done to open an exchange by showing you how others can interperet your writing. And its not done to belittle you. When you're a key employee you need to be treated and paid accordingly. Your devotion to the company, especially a small firm, is vital. And its only natural for energetic and skilled people to want to have a go on their own. There is nothing wrong with that. Its the American way. Now re read my initial post. In the 1st paragraph I question your job title. Perhaps I'm old fashioned and out of touch but the handle of senior field employee is foreign to me. I'm used to const. mgr. or foreman or lead carpenter etc. But that's a semantics issue and nothong to get hung up on. I'm establishing that you have a position of responsibility and are in the field (as opposed to the office). In paragraph (2) I re state your proposal to your boss. And in paragraph (3) I re state your bosses position upon hearing your pitch. The one line of paragraph (4) are your words re written out of context and side by side. And then you get the cold evaluation in paragraph (5). You revealed your business plan to the boss. But he's not gonna make it easy for you to go! Hallelujah!! Now what of the other posts. Any recurring themes? Take a look at what others have said. Danny boy's been around the block. No, there's no bug in my pipe either. As my lawyer's fond of saying,"advice is worth what you pay for it!" Regards, Dan-O
*Hi Ray and all, Our posts crossed. I read your reply after I had made my second post. But I'm sure you can see that others share the concept of getting it in writing. The people that take time to read your posts and offer good and valuable suggestions do so out of an esprit de corps. That is one of the best things about this site. Total strangers are willing to share the benefit of their experiences. Its decent. Ray, if you think I was hard let me apologize.You're a young guy in a business that is a challenge in every respect. We earn every nickel. I'll let others chime in and talk to you later. Okay, good night.Dan-O
*If you are already providing 95% of tools and equipment, gas, insurance for vehicles, labor, management, etc... then you are already earning at least 50% of net profits on jobs you are doing (in my opinion). These things are very costly to a business, and for your boss to have to go out and buy equipment, trucks, insurance, etc..., then supply new labor, it would probably cost him more than he will spend giving you your normal salary, plus 50% of net profits. Just remember that we are talking NET profits here, not gross profits, or 50% of sales. NET profit on most jobs can be pretty small in the big picture.Based solely on the information that you have provided, I would have to say that your boss knows your value to his company, and wants to keep you around. He probably knows that a new guy (to take your place) would not be producing the kinds of sales you are producing, nor will they come with all the necessary equipment and vehicles to get the job done. This would amount to a large out of pocket expense for the boss/company to incurr, as well as finding out whether or not the new guy can handle it. It sounds like he is willing to adequately compensate his company's main asset - you.Get it in writing, and have a go at it. What have you got to lose?Just my opinion...James
*Ray: Another thing to consider if you leave and start your own company is how you would replace what your current boss contributes to the business. If he is a good salesman and estimator you or someone else would have to assume this role. You may not be able to work like you do now to generate revenue. It is one thing to successfully complete jobs and another to sell them.
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I figure someone out here has some wisdom for me about my potentially divergent paths. I've been working for a small design/build remodeling firm for about 6 yrs. I've worked my way up to being the senior field employee. Last year I produced about 330k of work. One of my co-workers and I have been planning to start our own similar business. I approached my present boss about buying part of his company, admittedly holding my going off to be a competitor over his head. He responded with an offer to give me more autonomy over the jobs I run, two employees to always stay with me, and a supply of higher end remodeling, but he won't sell me part of his company. However he is willing to split the net profits 50/50 with me, on the work I run with my (his) two employees. He thinks I can produce 500 to 600k of work a year with 2 guys. (the 330K I did last year with about 3/4's of a helper.) So, is this too good to be true? I would keep my present wage and benefits, and get half the profits without any capital risk, general business responsibilities (beyond production) or selling. In my mind, it makes the patnership with my co-worker appear much riskier for similar rewards (in dollars at least.) I know this has been long winded. Thanks for bearing with me.