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Old 08-25-2006, 08:30 PM   #1
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In Answer To A Closed Thread. AAPaint


Quote:
I guess my post got deleted. What I was saying is this: Please show me the way. I hear a lot of talk about how successful everyone around here is. Well, I've done decent for one man with hardly any contacts to start with building a business off my own sweat, blood, and tears.

However, coming from literally nothing, and having a large family to support, I find it almost impossible to make any headroom. How does a guy with a very limited budget just jump outta the bucket and start making tons of money?

In my eyes, if I hire a small crew to do the work I do now, it may take a day or two less, but then I will give up half of the overall revenue in labor. With only half the profit from each job (or less) how am I supposed to re-invest in advertising to keep the work coming so I don't have to let those guys go and go back to busting my rear on my own? I have tried speeding jobs up by hiring a couple helpers and I end up in a bigger hole every time. Not because they were slow, but because the cost of their labor (even when included in the bid) still takes away from the final profit, leaving less to work with. Again, without tons of other work pouring in to both keep them going, and make my money on the volume, how does one get out of the cycle?

In the other scenario, I do all the work, it takes much longer. I have to try to estimate jobs covered in sweat and dirt from the last one, and hopefully keep work going. Because it takes longer, again, the revenue is lessened because I can only get so much done on the jobsite while still running the business every day.

So, if we're really gonna share some info here...help a brotha' out. There is a definite trap there for some of us. For a lot of people, this is no problem.....specially around here, but for some like me who don't have the luxury of referrals pouring in left and right, money to run enough ads to keep leads coming, time to both do the work and run the company, etc. When the work slows up, the money goes away....so how do you get out of this cycle? This isn't a case of not bidding enough (you can only bid what the market will bare, regardless) or not advertising enough, or whatever. It's a case of making something out of nothing, which I know many like me have done, but how? Where's the big break? Is there some secret that going to give me more money out of nowhere? Is there something special you can say that makes it all just work?

I'm posing this as a serious question. Admitting all faults, how does the small guy who's not master contractor of the world break the cycle? Advertise more? OK, but I can only work so many hours a day, and only so fast, and can only get X amount of money per hour in my area, and it's hard getting that sometimes.

Maybe it's just me, though. Maybe some of you were like that at one time and forgot what it was like. Maybe none of you ever had to worry about that, so it's not something you understand. Maybe, one day.....just maybe....somebody here will share some real answers, because in all honesty, that is the whole reason I come here.

I've offered a lot of free help when it comes to my trade, no problem. Now how bout some real help for the small guys that want something better?
AA,
This is my 3rd year in business. I've learned alot in the previous 2 years. When I first started I had some nice door hangers made. I hung over 1200 hangers in 10 days, my feet were swollen from walking so much. From those hangers I signed 5 jobs, huge homes in nice neighborhoods, I was a one man show working 12-14 hour days trying to get them done. When I got paid on my first job I took out an ad in a local paper. The phone started ringing, and still it was just me. I would leave a job at 6 PM stinking and dirty, hop in the van, which at the time didn't have AC (this was in Aug), get to the prospects home at 6:30 PM write the qoute, leave by 7:30 home by 8:30-9:00 do paperwork, eat in bed at 12:00 get up and do it all over again.

I was making decent money, but knew at 46 I could not keep up the pace, and I couldnt sign anymore jobs because I could not complete the ones I was on in the timeframe. I hired one guy with no experiance PT, he helped me out, but still I could not keep up. I really don't want to bore you with 2 years of details, so I will tell you what I've learned.

Mistakes I made:

1. Trying to do it all by myself.

2. Hiring the wrong people to help me.

3. Paying the wrong people to much money both in salary and bonuses for fear of losing all the wrong people.

4.Second guessing myself on estimates. Cutting my own throat.

5.Not having my overhead figured correctly. A HUGE mistake.

6.Paying to much in over time.

7. Going over on matierials.

8. Too many sundrys.

I'm sure I could think of more, but there's the short list.

Things I've learned. And I will attempt to address some of your concerns here: For purposes of referance I will give my have to have break even daily rate with all overhead incld. my salary, 2 guys salary, and all the bills pertaining to the business. This does not include profit.
$500.00 daily break even point with 3 including myself salary........If I were alone this number falls to $200.00

Quote:
In my eyes, if I hire a small crew to do the work I do now, it may take a day or two less, but then I will give up half of the overall revenue in labor.
Ok first, you have to have the right people in place, folks that understand the value of a strong work ethic. Now lets say that you have 2 employees that work extremly hard for you, even if their not painters to start with, the work ethic is essential. We just finished a job (exterior), it would have taken me at least 14 days to complete this home by myself. $200.00 x 14 days= $2800.00 labor. We finished this job in 4 days 5 hours...lets just say 5 days, and this was with me not on the job for a total of 6 hours. $500.00 x 5= $2500.00. I bid $2800.00 labor on the job and came under $125.00 on matierials = $425.00 profit. In the mean time I was able to give qoutes, track matierial useage etc.. So, your'e not giving up revenue, your'e increasing it, and you're not beat to death.

You take some of the profit, and invest it into advertising.

Quote:
I have tried speeding jobs up by hiring a couple helpers and I end up in a bigger hole every time. Not because they were slow, but because the cost of their labor (even when included in the bid) still takes away from the final profit, leaving less to work with. Again, without tons of other work pouring in to both keep them going, and make my money on the volume, how does one get out of the cycle?
Helpers are ok, but they have to be willing to work hard, and be willing to learn, this is the only way it will work, you don't have to be a speed demon...we arn't, but we are very efficient. The 2 guys I have now are amazing, when they started, they knoew nothing about painting, but their work ethic was excellant. I took time to train them, teach them as we went, and they wanted to learn, that is the major thing. The cycle starts to break when you have 2 good guys in place, and can afford to market more.
Quote:
In the other scenario, I do all the work, it takes much longer. I have to try to estimate jobs covered in sweat and dirt from the last one, and hopefully keep work going. Because it takes longer, again, the revenue is lessened because I can only get so much done on the jobsite while still running the business every day.
Been there, done that. When you are that tired you are going to make serious mistakes in your estimating, I know I did, and it hurt. Plus the fact that you really don't even want to be there rubs off on the prospect, again...no good. With the 2 good guys ....guys you can trust on site, you can more accurately give the estimates, thereby generating more profit to market with.

Quote:
but for some like me who don't have the luxury of referrals pouring in left and right, money to run enough ads to keep leads coming, time to both do the work and run the company, etc. When the work slows up, the money goes away....so how do you get out of this cycle? This isn't a case of not bidding enough (you can only bid what the market will bare, regardless) or not advertising enough, or whatever
You can't do it all, not and grow. Get a couple guys in place, pay them ONLY what they're worth to begin with with the promise of more to come if/when they learn. But
if they don't want to work cut them quickly, and hire 2 more, tell them what you are looking for a HARD WORK ETHIC, tell them your goals and how your'e looking for folks that can help you acheive those goals. When you find the right 2 deliever on your promises to them. Make them feel in all ways like an essential part of your business. Make damn sure you know all your overhead, have calculated it correctly, then bid what you have to to turn a profit...never vary!
Quote:
Maybe it's just me, though. Maybe some of you were like that at one time and forgot what it was like. Maybe none of you ever had to worry about that, so it's not something you understand.
Paint contracting is a damned tough nut to crack. I know exactly where you are because I was there not that long ago. Believe me I have'nt forgot what it was like. Don't get me wrong, I'm still "in the bucket". I still bust my hump every day. But I've learned alot from all the mistakes I made, and I've tried not to make those mistakes again.

After 2 years I have my 2 base guys in place, I have a moderate referral/repeat ratio. I have never through it all let the quality slide. My goal is to not have to paint in 3-5 years, will that happen? Who knows, too many variables, but I'm trying hard to get to that point. If you have any questions, I will be glad to share with you what little I know. Keep up the good fight!!
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Old 08-25-2006, 08:43 PM   #2
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Re: In Answer To A Closed Thread. AAPaint


great post, i read it real quick, please tell me, i mis read the part that you onyl charge $200 per day for yourself!!!

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Old 08-25-2006, 08:47 PM   #3
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Re: In Answer To A Closed Thread. AAPaint


If it were just me as opposed to myself and two others my overhead would need to be $200.00 per day.
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Old 08-25-2006, 08:52 PM   #4
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Re: In Answer To A Closed Thread. AAPaint


Don thanks for the quick reply, $200 a day gross for just you working alone seems extremly low for me, but everbody has their own thing going on, as long as it works for you.

Or maybe when you say your overhead, your saying $200 a day to just cover expences, now that makes total sence.

I was just a little confused on that part, but thauoght the whole post was awesome.

thanks
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Old 08-25-2006, 08:52 PM   #5
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Re: In Answer To A Closed Thread. AAPaint


Quote:
Originally Posted by donb1959
AA.................................
I will be glad to share with you what little I know. Keep up the good fight!!
Don, you get POST OF THE DAY!!!
Great advice. That's EXACTLY what this forum is all about.
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Old 08-25-2006, 09:19 PM   #6
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Re: In Answer To A Closed Thread. AAPaint


Great post. I go thru that every day..... I'm one guy w/ a helper...
don't want more cuz they can't do my quality of work. This post is extremely helpfull to all starting out and who have been in buisness for years! Thank you. Steve
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Old 08-25-2006, 09:25 PM   #7
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Re: In Answer To A Closed Thread. AAPaint


Don, great advice.
Except I don't understand the numbers.

What is your daily rate(what you charge to the customer) per employee?
I mean the sum total of field wages, overhead and net profit. Per painter
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Old 08-25-2006, 09:33 PM   #8
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Re: In Answer To A Closed Thread. AAPaint


If I've ever seen a word of truth on this forum, Don just said it perfectally. I wish someone had given that advice long before now.

When you knock down all the egos, every one of us have been in this same position at some time or another.
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Old 08-25-2006, 09:41 PM   #9
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Re: In Answer To A Closed Thread. AAPaint


A1 advice, rock on Don.
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Old 08-25-2006, 09:44 PM   #10
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Re: In Answer To A Closed Thread. AAPaint


I am a one man operation and in the past I have had as many as 5 guys and 2 women working, I would figure their hours and mine plus materials, Now I do it all myself not wanting anyones help, being that I am a loner it works better for me, out of all the people I have worked with and besides I have always worked circles around other workers. Now that I have been at this for 27 years I pick the jobs I want to do and blow off the BS jobs. The economy goes up and down that is life, if your looking to get rich by working for yourself forget it, it will not happen no matter how hard or how many jobs you do. If you want to make real money you take yourself out of the work place and put your lead man in that place you let him run the jobs and pay him well but not to well, then this gives you the time you need to run the business, you hire a girl to do your office work this again frees you to do the estimates and run materials to job sites, or you hire a young guy to do that, again you are free with more time. as time goes by and you will learn how to pick the cream of the corp as for workers goes. that is how you become rich from your business, so if money drives you then good luck to you, I myself love the work not the money so being rich doesn't fog my sight. but that's my two cents.
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Old 08-25-2006, 09:44 PM   #11
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Re: In Answer To A Closed Thread. AAPaint


Seriously, you made a mistake with your numbers, right?

I mean we pay our painters 200.00 per day or more plus labor burden.

I know that you must have just not thought it through or forgot a zero or something, right?

If everyone thinks that 200.00 per day per painter is the correct, or even close to the correct numbers to use, you are WAY off base.

I'm sorry and I am trying to be as polite as possible. If people follow those numbers, the advice does MUCH more damage than help,

Paul

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Old 08-25-2006, 09:57 PM   #12
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Re: In Answer To A Closed Thread. AAPaint


[QUOTE=donb1959]AA,
Now lets say that you have 2 employees that work extremly hard for you, even if their not painters to start with, the work ethic is essential. We just finished a job (exterior), it would have taken me at least 14 days to complete this home by myself. $200.00 x 14 days= $2800.00 labor. We finished this job in 4 days 5 hours...lets just say 5 days, and this was with me not on the job for a total of 6 hours. $500.00 x 5= $2500.00. I bid $2800.00 labor on the job and came under $125.00 on matierials = $425.00 profit. End Quote!

On a 2800.00 job your NET profit after all expenses and without YOU painting at all should be around 900.00

The labor, burden and materials should not be more than 1400.00 without you painting.

That leaves 500.00 for Overhead and 900.00 for yourself and your company without YOU painting at all.

Please tell me this is the correct numbers and that you were posting something different.

Paul
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Old 08-25-2006, 09:58 PM   #13
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Re: In Answer To A Closed Thread. AAPaint


Great post Don! Thanks for taking the time to type all that out... I know it will help many.

Quote:
Originally Posted by Paul Burns
I know that you must have just not thought it through or forgot a zero or something, right?
Paul, let try to keep this and all thread positive and not pick fights by being negative. Were all trying to move past the last few days.

Thanks.
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Old 08-25-2006, 09:59 PM   #14
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Re: In Answer To A Closed Thread. AAPaint


Okay what am I missing?? for me one emloyee cost me $28.00 legal Social security and work comp etc. That's $28.00 x8 hours = $224.00

That's just my cost for pay roll. I never finished 8th grade so maybe I am missing something. I figure more like around $400.00 per guy for a day of labor with all the over head. Which my overhead people tell me is VERY low.

What am I missing in the $200.000 figure? If I was charging that I would be making no money. I am in Montana so I should be on the lower end of the price scale I would think. Less than 1 million in population in the whole state.

Not trying to be negitave in any way. Just really wondering what I am missing.
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Old 08-25-2006, 10:00 PM   #15
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Re: In Answer To A Closed Thread. AAPaint


Quote:
Originally Posted by George Z
Don, great advice.
Except I don't understand the numbers.

What is your daily rate(what you charge to the customer) per employee?
I mean the sum total of field wages, overhead and net profit. Per painter
My daily rate is what I charge the customer, per day, not employee. $500.00 per day covers all my overhead including salary, I then tack on a profit to that number.
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Old 08-25-2006, 10:03 PM   #16
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Re: In Answer To A Closed Thread. AAPaint


Quote:
Originally Posted by Nathan
Great post Don! Thanks for taking the time to type all that out... I know it will help many.

Paul, let try to keep this and all thread positive and not pick fights by being negative. Were all trying to move past the last few days.

Thanks.
Nathan, seriously, do you think that is me trying to pick a fight? I was trying to be as polite as possible and even posted those exact words.

If ANYONE sees ANYONE posting something that is off and could do serious damage to others, shouldn't someone speak-up?

Paul
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Old 08-25-2006, 10:09 PM   #17
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Re: In Answer To A Closed Thread. AAPaint


Quote:
That's just my cost for pay roll. I never finishe 8th grade so maybe I am missing something. I figure more like around $400.00 per guy for a day of labor with all the over head. Which my overhead people tell me is VERY low.
Blaster,
Ok, lets take your scenario, I know that each one of us has a differant operating expense, but here goes.

Ok, you charge $400.00 per day per man. Lets say you're like me and have 3 guys including yourself. Thats $1200.00 per day labor. So, youre qouting a job that you figure will take 4 days. 4 days @ $1200.00 per day is $4800.00. Lets tack on matierial to that figure and say 8 gals at $25.00= $200.00. So you will bid this job at $5,000.00 and that's not including a profit?
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Old 08-25-2006, 10:09 PM   #18
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Re: In Answer To A Closed Thread. AAPaint


Sounded like a jab to me but I'll take your word on it. I Now lets get back to the subject at hand.
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Old 08-25-2006, 10:14 PM   #19
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Re: In Answer To A Closed Thread. AAPaint


Quote:
Nathan, seriously, do you think that is me trying to pick a fight? I was trying to be as polite as possible and even posted those exact words.

If ANYONE sees ANYONE posting something that is off and could do serious damage to others, shouldn't someone speak-up?

Paul
It's not off for me. I have figured what I need to make. Not everyone can or should use these numbers, they are arbitrairy to others, to me they are true. Folks should ofcourse do their own due diligence to arrive at the numbers they need.
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Old 08-25-2006, 10:28 PM   #20
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Re: In Answer To A Closed Thread. AAPaint


Quote:
Originally Posted by donb1959
It's not off for me. I have figured what I need to make. Not everyone can or should use these numbers, they are arbitrairy to others, to me they are true. Folks should ofcourse do their own due diligence to arrive at the numbers they need.
If it works for you, that's great man. Roll on Brother!

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