I've been working for a few years now and have gotten myself what I consider to be pretty steady work. My question is, how do I prepare my company for hiring an employee? It seems like the only way I can do it would be to get so busy that I work 10 hour days 6 to 7 days a week, then when I can handle no more, drop my work to 40 hours a week and hire a part timer. I just want to make sure I'm structuring my business properly now, so things work out later.
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- Thread starter clearview
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thats a good question... Do a little reasearch about what it takes to hire your first employee... First off, do you even have enough steady work to keep the employee busy? If you do, how long is it going to take to get the employee up to speed so they can go do jobs by themselves and not mess anything up. Another thing to consider is cost and paperwork, if you're operating under sole prop and using your ss# as your id you're going to have to file to get a fed tax id which is really not that big of a deal.. but if you hire the employee your insurances (gen liab., workers comp, commercial auto) will all go up. Keep in mind you're going to have to consider the headache of payroll wiltholdings and costs (add roughly 20% of what you're expecting to pay out). for me, hiring an employee does not make sense if you're looking at cost + headache vs reward for the short time they would actually be employed... but it all depends on your situation. Consider this: you can hire temporary work (somone you know and trust) to help you out when you've got a lot of jobs lined up. The can work with you and make up to $500 without you being required to give a 1099. If they make under 500 working for you, they are also are not required to file the self employement tax form which i dread every year... i hope this helps...
-Jonathan
-Jonathan
it does help some. i'm just pretty much planning on making the transition somewhere down the road. currently I know I don't have enough work for myself and an employee. I'm just trying to make sure that I have a plan for transitioning when that time comes. My work load has nearly doubled since last year. I figure I'm doing something right. I don't want to be doing all the work till I'm 60 years old. My goal is for this company to be passive income for me. I've got plenty of time to build my business. I just want to make sure I'm doing it the right way.
PressurePros
New Member
A good alternative is to use a labor staffing agency. They will handle your payroll taxes and workman's comp. That way you are also not obligated to keeping an employee busy.
crearview,
i know what you mean about the passive income goal. Pressure washing is fun, but you're right you cant do it forever. You said you're twice as busy compared to last year. Is there anything you're doing different to get more business? or is most of your business coming from referrels?
i know what you mean about the passive income goal. Pressure washing is fun, but you're right you cant do it forever. You said you're twice as busy compared to last year. Is there anything you're doing different to get more business? or is most of your business coming from referrels?
to be honest i'm not totally sure. i think networking with other companies in surrounding areas helps. actually i get all my stuff at a local landa and have even gotten referrals through them. seems like the less you try to compete with your competition, and the more you learn from and work with them, the more work you get. referring each other can be great. i know several within 20 miles of me. i know that i'm always trying to step up my professionalism and customer service. each of my customers gets a follow-up letter in the mail asking for feedback and referrals. i always try to look decent and smell good when i give a quote which can be hard after working in the heat. i always try to take an interest in what my customers talk to me about and build at least some kind of small relationship with them. seems to really help the referrals. overall, no big changes though.
i always try to take an interest in what my customers talk to me about and build at least some kind of small relationship with them.[/QUOTE]
This goes a long way...I always mention to new customers that I am a teacher and will probably be cleaning there house from 3:30-7:30. They always reply with something about how their mother, father, sister, brother son, or daughter is a teacher.
This goes a long way...I always mention to new customers that I am a teacher and will probably be cleaning there house from 3:30-7:30. They always reply with something about how their mother, father, sister, brother son, or daughter is a teacher.
I have been in business for 6 years and I will be 63 in Aug. I started out with nothing and I still have most of it!!! Really I started with 0 customers and now enjoy an income of over $50,000 working by myself. I almost hired a helper but could not make it cost efective. I updated equiptment every year. Two years ago I bought my first hot water machine,,,,,,the best investment I have made, I can do twice the amount of work and a lot eaiser!!! Also that machine has never missed a day of work and does not talk back to me!!!
I don't know what type of cleaning you do or what kind of equiptment you have however this is something to keep in mind!
mr. P
I don't know what type of cleaning you do or what kind of equiptment you have however this is something to keep in mind!
mr. P
Mr. P
I'm 22 years old. I do window cleaning, gutter cleaning, roof cleaning, and all the standard house wash and flatwork. Last year I grossed 37,000 in my first full year. This year I've already made about that much. Last year I was still doing sub work for some other companies, but I've mostly transitioned out of it at this point. I just think taking enough time to do a great job (which means charging enough to do so) and professionalism really help my referrals. I'm pretty sure I can hit 60,000 if I keep it up. I do contribute some of my pay raise to my hot water rig. I love it. Not only is flatwork a breeze; the fact that I have it brings me more business. Customers are impressed by it because you can't just pick one of these up at the store. It's largely inaccessible to them. It looks plain old cool. Anything that I can do in a way that they can't, I will. You just need to make it look like they're paying for something they couldn't do themselves. That's one of the reasons people use the swivel method on window cleaning, not to mention it can save a bit of time if you get good at it. Even if it won't save me time, I'll still use it just to look like I know what I'm doing. Seems to help.
I know 2 window cleaning business owners in my area who are your age. I talk to them both pretty regularly and work with them from time to time. I'm definitely glad I added pressure washing to my window cleaning business and not the other way around, because I would have been irritated with all of the added ladder work that came with it otherwise. Still it's relatively inexpensive to add on compared to a hot water rig!!!! Good grief, that thing costs more than my mortgage, but I'll be done paying for it by the end of the year.
Still wish I knew how to get a dang employee
I'm 22 years old. I do window cleaning, gutter cleaning, roof cleaning, and all the standard house wash and flatwork. Last year I grossed 37,000 in my first full year. This year I've already made about that much. Last year I was still doing sub work for some other companies, but I've mostly transitioned out of it at this point. I just think taking enough time to do a great job (which means charging enough to do so) and professionalism really help my referrals. I'm pretty sure I can hit 60,000 if I keep it up. I do contribute some of my pay raise to my hot water rig. I love it. Not only is flatwork a breeze; the fact that I have it brings me more business. Customers are impressed by it because you can't just pick one of these up at the store. It's largely inaccessible to them. It looks plain old cool. Anything that I can do in a way that they can't, I will. You just need to make it look like they're paying for something they couldn't do themselves. That's one of the reasons people use the swivel method on window cleaning, not to mention it can save a bit of time if you get good at it. Even if it won't save me time, I'll still use it just to look like I know what I'm doing. Seems to help.
I know 2 window cleaning business owners in my area who are your age. I talk to them both pretty regularly and work with them from time to time. I'm definitely glad I added pressure washing to my window cleaning business and not the other way around, because I would have been irritated with all of the added ladder work that came with it otherwise. Still it's relatively inexpensive to add on compared to a hot water rig!!!! Good grief, that thing costs more than my mortgage, but I'll be done paying for it by the end of the year.
Still wish I knew how to get a dang employee
PressurePros
New Member
clearview said:Still wish I knew how to get a dang employee
I don't understand your question. You either hire one, pay workman's comp, take out payroll taxes, and start advertising to keep work coming in or you hire a temp from an agency and pay them one flat fee to cover all the above. There really isn't any in between. As far as structuring your business there really isn't much to do. Its pretty much the same no matter what type of entity you are.
I suppose you can subcontract buts thats not really a new guy venture.
let me explain it in a different way then. 1 person can only work so much. how does anyone work full time plus do enough work to begin giving to an employee. i realize i could work a 55 hour week and be making good money, but that would only give me 15 hours over my 40 to give to a new guy. the only thing I could say would be this job is part time but may grow into full time. other than that i can't see how to make the transition. if he worked with me on every job he'd be working more than I'd need him to, and I'd be taking a pay cut for all my trouble.
north coast
New Member
How about having someone out in the field working, making you money while you sit back and manage them, and build your sales and marketing. You said last year you had $60,000 in sales, some one needs to build that number up to make a business work or you may be better off just working for someone else.
north coast
New Member
Your gross was $37,000 for an entire year of work, you would have made more money working for some one else after your COGS and overhead you may have made around $6,000. If you want to make this work you need someone selling your company and marketing it to make sure you reach your goals of not being out in the field washing at 60.
i know i netted over 25,000 out of my 37,000 last year. i am doing direct mailing with a professionally designed postcard. i'm having my website updated. half of my work has less overhead than pressure washing because it's window cleaning. that was mostly what i did last year. how many people make 100,000 in their first full year anyway? believe me when i say that i put as much money back into my company as i can afford to. if i had several thousand dollars sitting around i'd cover my whole county with postcards. as it is, i can only put out about 6,000 postcards at a time. i'm targetting the wealthier parts of town and all that good stuff. i'm definitely not a lowballer. i'm usually pretty meticulous. i make the effort to be professional. it just takes time to build up a good customer base. it's just not in my budget to hire someone to do all my work while i wait for the phone to ring and do the occasional quote.
i'll say it again, my number one question here is how to make this transition without losing a ton of money. seems like people are having a hard time explaining this to me. i'm not even saying i'm ready to do it in the near future. i was only trying to be sure i was setting myself up to down the road. i know my company would grow if I had someone out promoting me all the time. But there's a couple problems with that: 1) I can't afford to pay someone to do that. 2) I have no idea what he, she, or I would do all day as a full time promoter.
If anyone has suggestions on how I can change my business to put me in that kind of position, I'll gladly listen.
i'll say it again, my number one question here is how to make this transition without losing a ton of money. seems like people are having a hard time explaining this to me. i'm not even saying i'm ready to do it in the near future. i was only trying to be sure i was setting myself up to down the road. i know my company would grow if I had someone out promoting me all the time. But there's a couple problems with that: 1) I can't afford to pay someone to do that. 2) I have no idea what he, she, or I would do all day as a full time promoter.
If anyone has suggestions on how I can change my business to put me in that kind of position, I'll gladly listen.
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PressurePros
New Member
Go out an buy E-myth and read it. Your mentality is typical of that of a technician. Thats not a slam but a mentality you must overcome. You are making this way harder than it needs to be. Your time as a business owner should not be spent as a laborer (though we all do it especially in the beginning). You should be concentrating on the real things that make you money. Sales, networking, marketing, streamlining, developing systems etc.
What you are realy talking about is how to become more efficient. I have two crews rotating in the field and just added a third. Lets look at one crew (my most productive) Last week they stripped and stained 4 decks and washed 5 houses and some misc jobs. The gross income from those jobs was 600% (6 times) that of my payroll expense. For every dollar I spend on them they make me back $6. That didn't happen overnight. But I think it answers your question. When I go out as half a crew I save $800 per week in labor expense and it positivelty isn't worth it.
What you are realy talking about is how to become more efficient. I have two crews rotating in the field and just added a third. Lets look at one crew (my most productive) Last week they stripped and stained 4 decks and washed 5 houses and some misc jobs. The gross income from those jobs was 600% (6 times) that of my payroll expense. For every dollar I spend on them they make me back $6. That didn't happen overnight. But I think it answers your question. When I go out as half a crew I save $800 per week in labor expense and it positivelty isn't worth it.
Ken,
I believe it. I definitely want to get to the point where I can have crews and be managing my company. I just can't figure out how to do it. Would it be alright if I called sometime? I won't chat your ear off or anything. It's like you said, we all spend time as a laborer especially in the beginning. Well, I'm in the beginning still. I'd just like to get out of that phase, and I'm asking you guys how to make this transition. I'm absolutely positive that once I've got a few guys working for me, I'll be making more money than I would doing it all alone. I merely ask, HOW? I'm certain I don't need to be sold on whether or not I should hire at some point.
I'll try to stop by Borders and pick up that book. Thanks.
I believe it. I definitely want to get to the point where I can have crews and be managing my company. I just can't figure out how to do it. Would it be alright if I called sometime? I won't chat your ear off or anything. It's like you said, we all spend time as a laborer especially in the beginning. Well, I'm in the beginning still. I'd just like to get out of that phase, and I'm asking you guys how to make this transition. I'm absolutely positive that once I've got a few guys working for me, I'll be making more money than I would doing it all alone. I merely ask, HOW? I'm certain I don't need to be sold on whether or not I should hire at some point.
I'll try to stop by Borders and pick up that book. Thanks.
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PressurePros
New Member
You're still not hearing what I am saying and that is my fault for not communicating it well. You make the transition by selling more jobs and by becoming more efficient. You become more efficient when you have a laborer that will work side by side with you. That person will take the wand and let you step back and evaluate your methods and develop systems to speed things up. Set your jobs up for three days a week when yuo will have a helper. On your days out of the field work on your marketing. Read books on closing sales. Attend seminars. Take classes at the local CC. Cold call new accounts! Evaluate your numbers and expenses.
I also recommend if you are busy that you raise your prices. You should do this many times until you reach a point you are losing half of your bids. At that point once you are at the right margin, you start expanding.
With the hiring of an employee you have to just pull the triger. Remember you aren't looking for a lifer or someone that makes his career as a laborer. You don't need high skilled labor. If we get in a jam for labor we have a couple of halfway houses from which we can pul day labor.
I also recommend if you are busy that you raise your prices. You should do this many times until you reach a point you are losing half of your bids. At that point once you are at the right margin, you start expanding.
With the hiring of an employee you have to just pull the triger. Remember you aren't looking for a lifer or someone that makes his career as a laborer. You don't need high skilled labor. If we get in a jam for labor we have a couple of halfway houses from which we can pul day labor.