Business Opportunity??? Any Thoughts?

innovous

Not sure if this should go in the business forum, but since I mostly do roofing....

I was approached by a company with an offer that sounds interesting:

Essentially I would sign up with them, use their brand/name/etc..., they run the "back-end" of the office (marketing, invoicing, change orders, contracts, etc...) and I run the "front-end" (sales, production, crews, etc..).

They charge a percentage straight off the top of each job (seems to average right around 12%).

Now, I know the math on my biz and I spend more than 12% on these areas which is why this is interesting to me. There are the obvious things to look into such as legal, how good is their "brand/name", and a number of what-ifs, But have any of you seen or used anything like this before? Any sage advice?

Mike Finley

Nothing is ever as good as it looks. Keep in mind the more they try to do (that list is long in what they cover) the more average their results will be. That's the nature of it, you can't get around it. Paperwork is one thing, handling your marketing for you is another. I'd predict without knowing a thing about them that mediocrity will be the norm. Kind of reminds me of search engine optimization companies or people who basically promise they will sell you a way to take a rock and turn it into a piece of gold for $39.95. The basic rub is why sell a product to somebody for $39.95? Why not just collect all the rocks you can find and turn them into gold for themselves?

innovous

Thanks Mike...good points. Their charges vary based on what you have them do. It is tempting because of the paperwork piece...it would save me time and overhead. Seems like it could get complicated pretty quick.

MALCO.New.York

Think "Shaaaam-Wow","Kaboooooom" or the like!!!!

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buildpinnacle

You had a hail storm recently? This reaks of the stormers coming in and using a local's good name to make money and run and leave you with all the warranty work. I've seen several spins. They leave a certain $ per square back for warranty work that is 'put in escrow' and split with you after five years. Run your own business is my advice.

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RidgeWalker

Mike the rock is the $39.95 they only tell you that after you've sent them your rock!

@Pinnacle,

I've seen storming companies who do this and there are companies who have suffered for allowing storming companies use thier name. However it is a legit business relationship but what I think happens is the local guy starts to see the gold without taking percautions to protect is reputation. One thing that comes to mind as a local guy would be to insist that all work gets inspected for a set fee per built job, say $75 to $100 per job. Any job requiring repairs are reported or affected on the spot and billed for. If i were approached by a storm company I'd be directly involved in those aspects and have the additional money set aside in an escrow account for repairs. Typically the overall fee is 5% with 3 going in escrow and 2 paid for the use of the name, phone number and any currant advertising.