Another Workmans Comp rant

Now we’re cookin’ with gas! Thank you Jared!!

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average job size and lack of recurring work is a huge factor

once getting into employees the owners job has changed to mostly HR, many don’t realize that or cant get out of the truck (cashflow wise) to spend the time on the HR stuff

or I should say many don’t allocate enough resources of all kinds to the new HR stuff that never existed before

for an engine to run, it can’t be built in sections and still run until its fully built, everything needs to be in place first before the engine can actually run. that’s the ideal anyway and why its so difficult

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hmmm a word problem, let me have some fun:

3 days a week with wife @ $150 per hour together @ 6 hours on the glass a day = $2,700/week Revenue & “After Cost of fulfillment Contribution”

2-3, let’s use 2.5 full time crews X @$150 per hour per team x 6hours X 5days = $11,250/week revenue

Cost of fulfillment
wages (s/b around 30%) $3,375
payroll burden (14%) $473
work comp (21%) $709

leaves $6,693

or $3,993 more than solo

What could possibly chisel away at this amount???

Well . . . a lot

with 5 people someone is always going to be out sick or something (patterns I saw were only one perfect attendance week per 4-6 weeks!) = lost revenue

they go thru supplies faster
break equipment more
higher maintenance on vehicles
higher insurance for their driving records
=higher expenses

then you get into the production factors
they probably are not doing $150 per hour together like owner and wife, could be more like $100-$125 (as an annual average) using these numbers for illustration
attitudes
team dynamics (guys fight and don’t get along with each other)
team skills (some combinations of teams work wayyyy better $ wise than others)

training! that team is doing less than one guy in $ production for awhile

quality
customer repairs
customer callbacks - time effort- energy - money

Admin:
takes about 6 hours a week per FT employee for admin, the whole scope of admin for the increase in jobs etc
if you have to hire an office person = expense
software to handle all that = expense, perhaps monthly

Wheres the office girl going to work?
need an office= expense
need equipment for office = expense

who’s doing the IT for all this increase in devices and desktops? = time or expense

Who’s washing and drying towels?

Who’s checking the trucks and equip?

Who’s doing the safety meetings = time, prep, research

Where are the trucks parking? is it secure?
need office with place to park vehicles = expense

Who’s doing all the hiring firing? = time
progress reports?
wage increase evaluation reports?

how’s the weather where you are? is it a full 85% so cal year or is it a 60% year?

the biggest revenue eater: turnover
your best guy moves on
your helpers quit
team dynamics change
morale can change

on and on

this leads to wild mood swings in revenue and net contribution thruought the year

so yes Alex, it is possible they are doing better as a husband and wife with the most minimal business expenses, I am sure they certainly have more time to choose what to do with when not on a job for sure

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Slammin Breakdown @Bruce

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So glad you find this sort of math “fun”. It really contributes to the value of the forum :man_student:

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You just made me remember why I hated having big crews. I got my head ache back just reading it.

Been there, done that and HATED IT.

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Reminds me of the slogan
"Stay small keep it all"

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Yeah right. Till my Uncle finds out. You may have met him, his first name is Sam.

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I pay all my taxes and insurance. I just don’t have many experiences to speak of because it’s a small operation now.

I saw you and your crew on the cover of a window cleaning magazine. Have you come to your senses and scaled back?

Wrong thread, sorry.

Had no choice. That photo was BEFORE I had real crews working. One of them in that photo is one of my main competitors now. We’re really not on speaking terms, havent been in a few years now.

Yeah, I’ve scaled down.

Nothing like investing hundreds and hundreds of dollars of your hard earned money to train and develop your competition, eh? :sunglasses:

PS
Sorry to hear it.

hundreds? I wish it was that little.
It’s not the money either, money will come and go I could not care less about it.

I lost what I had believed was a good friend. I had tried to build something, by building him, and others.

I’ll tell ya, I used to be hungry. Every single day, building and creating. It was contagious.

Until what happened happened. That took the wind out of me to say the least. After that, I’m content with how it is now.
I put all of that energy, all of who I am into what I believe would have been a masterpiece, just to see it all come to nothing.

It changed me. The only thing that could ever motivate me again would probably come from my son. We’ll see what the future holds, but for now I’m just tired of the same movie.

Don’t mean to be negative or infect someone’s nice day. Just telling my side is all. Hopefully it will help others in some way.

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On the lowball thing I tell my new quotes I will match a price of a reputable company that has been in business at least five years, has been registered to do business under the state, and has insurance and workers Comp.

I tell the customers to ask the lower bidding companies to provide this info, and sure enough 9 times out of ten I get the job at the higher rate, or I get them the next year when bucket Bob realizes he can’t make a living low balling.

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And to be honest I don’t want customers who want the lowest price and doesn’t care about security or integrity. I have customers call me and say can you believe my last window cleaner broke that and didn’t replace it, and he doesn’t show up any more. Then I give them the price and they say but my last window cleaner charged me $8 less. I say ma’am for $8 more I’ll be back for as long as you want your windows done and if I break something I’ll replace it, or you can try to track down the irresponsible guy who doesn’t respect you or your property enough to replace what he breaks nor show up.

Okay your hired every time, I actually get sick of the conversation it’s 6 times a week at least. Or they will say my previous window cleaning company went out of business and they will ask if I will match their price. This really makes me mad! So you’re essentially asking me to charge a price that will eventually leave me matching the result of your previous company…out of business!!!

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For comparisons sake: I paid $860 for $12K for Janitorial in Alaska. I am exempt and do all the WC solo (resi and 2-3 story commercial). Now that I have an employee I don’t have to clean buildings six nights a week and I can go out of town to be with my kids and grandson!
Strangely I was told that the rate wouldn’t increase until $15K. I was also told that $100 was a one time brokers fee. Yeah right, when I renew I will probably get hit with a “first time renewal fee.” ;(

Wisconsin workers comp insurance pool for WCs is $.53 on the $1.00 paid to employees for the year. We don’t see a profit until July.