I have to believe if others have experienced the opposite of me then my situation was rare. However first time this year I hired married men, men with kids. Figured they had more of reason to work. I will admit I am not good at pushing my guys passed 8 hours.
My experience:
Young guys: lower bills, maybe living at home. They are not hungry and don’t want to work “too” hard.
Older guys/married guys: HAVE TO WORK, and they went 10-12 hours for 5 months straight.
Really opened my eyes to some matters and showed me what is possible.
We have started looking for what we call “providers”. Men who need to make money to put food on their tables. They show up everyday, don’t want to lose their jobs and can recognize a stable business. We fit their family situation into the work schedule and they don’t quit.
Believe it or not as much as I am a “sunup to sundown”/push, push, push kind of guy…
I really LIKE this. Steady - you know where they stand.
THAT makes things easy to work with.
Personally, I think that might be second only to ‘Repeat Cust’ in my mind.
There have been many times where I would KILL for this reliability.
That’s as far as I will derail this thread, because it’s… kind of awesome.
Dave right in between those two scenarios you have “College Guys” | This guy that worked with me a long time ago when we first started hiring said to me
"Chris man you gotta hire college guys, there like squirrels. They want to work real hard for a short period. They want to have as much beer money as possible for beer when they get back to school. "
My second business partner was ideal for our employer. He was 20, going to college full time and living out on his own. He HAD to work.
Some of my best guys have been college guys. However, I have yet to have one which is living out on his own, so the pressure is not quite there for them.
Love college guys but am “hurt” by the quarter system. Our college don’t get out till Mid to late June.
They tend to get out for summer June 15th-June 20th and go back to school (kind of forget) around early to mid Sept.
One of my best (all around) employees started with me while in highschool and went to school on the East Coast and was on the semester program. Loved it. He’d come back and work a week around Thanksgiving, then give us 2 weeks in Jan or so.
We had a beautiful relationship for 4-5 years now he’s graduated living in CA with a start up.
I think the bottom line here is that you can only make so much net profit in this industry due to the seasonality of it.
In my (reasonable) opinion that number would be around $200k - $250k per year max. This could be done with a $500k company or a $1.5M company, or any number in between. What is the upside to having a 1M company that profits 20% vs a 500k company that profits 40% if they both produce 200k net?
Obviously the larger the company gets, the smaller the net profit percentage will be (to a certain extent).
The 500k model is simple because all administrative work, sales, and everything other than field work can be done by the business owner. This can be done with only 2 crews which adds to the simplicity (providing that a few jobs are subbed out throughout the year).
Jumping up to 1m in sales requires, sales rep, office worker, office location, field supervisor etc.
I think for most people the 500k model would be a much more achievable goal than 1m
I don’t see how you could pull 40% profit out of that, payroll alone would eat up close to 50%. I think I’d be an extremely unlikely scenario. Also, slow season doesn’t exist, it’s a mindset; the work is out there, go get it.
I do it, payroll eats up close to 40% and 20% goes to all other overhead. I do sub out a decent amount of work though. So this could have something to do with it. 40% profit is doable considering the business owner is doing all the administrative work, estimating, sales, etc.
Slow season DOES exist in my area. I am not saying there is absolutely no work out there, but any work that there is will be fought over by a bunch of guys lowballing who are staving for work.
Aren’t you in San Diego? There’s over a million population. The work is out there, you just gotta go get it. I used to think exactly the same way. I don’t use the term “slow season” anymore.
Yes, there is an enormous amount of one man show type businesses here though… Honestly, I don’t go get any work anymore, I just take the work that comes in through adwords/ organic rankings. I don’t have the time or patience to be cold calling and soliciting business anymore.
I am not really concerned about my own business, I was just trying to point out that I think there really is a maximum amount of net profit that can realistically be made in this business regardless of gross revenue. I am sure there are exceptions to this, but I don’t see many guys doing over 250k net profit in this industry. Length of time in business can play a major role obviously, so businesses that have been around for 15+ years will have a better shot
just like the Profit First book or the Simple Numbers book, once beyond what the owner
or owner plus part time girl
or owner plus free labor of wife
can administrate, it’s a whole new level of expense
I think the problem most find is up until this point, an income has been established and going further requires a big drop in income as expenses greatly increase all at once for an undetermined and possibly quite lengthy time period (as far as the feeling of decreased income goes) until the income gets back to where it was to begin with
most probably spend a year or two, get overwhelmed, overworked and grossly underpaid (the drop of income) and say forget it
for example, if one has established an income of 200k at 500k revenue, as has been previously discussed, one may not see that 200k comfortably again until the 3 mil mark
that’s a long stretch
kind of like doing a marathon or Spartan race, there’s a reward at the end but its so grueling until the end will you/can you make it?
what’s interesting is the ones that sell that do get around that point
When you say 40% profit is doable… is that before or after you pay yourself?.. and how much would you have to pay someone(s) in your business to take over the hours and duties you handle?
