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Starting A Small Carpentry Business

 
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Old 08-21-2014, 12:03 AM   #1
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Starting A Small Carpentry Business


I'm starting a small carpentry business. I've been in the trade for 14 years on and off and spent most of that time working for a large, high end construction company on Long Island. I'm leaving on very good terms and just looking to make more money and challenge myself a bit.

I picked my boss' brain a lot along with others in the trade and I've read a lot of forums here. I'm confident in my abilities and hard work but not with my business sense. I have a full time career and work construction 3 or 4 days a week because of the hours of my other job. I'm loaded up with tools and a trailer. Most of my work now is friends and family but I'm getting a license and starting an LLC. I figure I know enough people in the trades to keep working during slow times.

Not having been a business man, I'm wondering how busy I'll need to stay to be successful if I'm working out of my home with very little costs for my business. I'm not looking to get rich but to supplement my income doing what I've been doing for some time. I am though looking to do better than a days pay and to take on more responsibility. Any feedback or advice would be much appreciated. Also sorry for the long winded post.
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Old 08-21-2014, 06:14 AM   #2
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Re: Starting A Small Carpentry Business


Some suggestions would be:

Start of by sitting down and writing down all your business expenses along with what you want to make. Estimate the amount of hours you think you will work your first year. Divide that out and you get an approximate idea on an hourly rate. It should be fairly close to what others around you in your local market are making. Just because you can survive on 25 doesn't mean you should charge 45 and actually grow your business.

This was something I used if figuring my pricing initially, I made 3 senariors, worst case, middle of the road, and target.
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Old 08-22-2014, 01:21 AM   #3
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Re: Starting A Small Carpentry Business


Quote:
Originally Posted by 92island View Post
I'm starting a small carpentry business. I've been in the trade for 14 years on and off and spent most of that time working for a large, high end construction company on Long Island. I'm leaving on very good terms and just looking to make more money and challenge myself a bit.

I picked my boss' brain a lot along with others in the trade and I've read a lot of forums here. I'm confident in my abilities and hard work but not with my business sense. I have a full time career and work construction 3 or 4 days a week because of the hours of my other job. I'm loaded up with tools and a trailer. Most of my work now is friends and family but I'm getting a license and starting an LLC. I figure I know enough people in the trades to keep working during slow times.

Not having been a business man, I'm wondering how busy I'll need to stay to be successful if I'm working out of my home with very little costs for my business. I'm not looking to get rich but to supplement my income doing what I've been doing for some time. I am though looking to do better than a days pay and to take on more responsibility. Any feedback or advice would be much appreciated. Also sorry for the long winded post.
You can always work. The question is will you be earning money or paying for the privelege. Relying on your circle of tradesmen sounds inssufficient to generate enough sales to survive. Figure one third of gross will actually be yours. Thirty percent to taxes and overhead, thirty to materials and tools.

What are you selling? Why? How is it being marketed.
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Old 08-22-2014, 05:33 AM   #4
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Re: Starting A Small Carpentry Business


Quote:
Originally Posted by 92island
I'm starting a small carpentry business. I've been in the trade for 14 years on and off and spent most of that time working for a large, high end construction company on Long Island. I'm leaving on very good terms and just looking to make more money and challenge myself a bit.

I picked my boss' brain a lot along with others in the trade and I've read a lot of forums here. I'm confident in my abilities and hard work but not with my business sense. I have a full time career and work construction 3 or 4 days a week because of the hours of my other job. I'm loaded up with tools and a trailer. Most of my work now is friends and family but I'm getting a license and starting an LLC. I figure I know enough people in the trades to keep working during slow times.

Not having been a business man, I'm wondering how busy I'll need to stay to be successful if I'm working out of my home with very little costs for my business. I'm not looking to get rich but to supplement my income doing what I've been doing for some time. I am though looking to do better than a days pay and to take on more responsibility. Any feedback or advice would be much appreciated. Also sorry for the long winded post.
I recommend the book "mark up and profit, a contractors guide" I just finished it and it was very helpful.
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Old 08-22-2014, 06:10 AM   #5
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Re: Starting A Small Carpentry Business


What part of the island are you located in and focusing your business on?

You don't need to be busy to make money, you need to be very profitable.

Now that I'm older, weaker, tired and burnt, I do less and charge more.

Family and friends are fine for training purposes only. Making mistakes on their projects is not as stressful, but it's a different world with real clients.

Keep it simple, take on stuff you know very well at first and don't fall into the trap thinking your overhead is low because you work out of your home. You still need Truck ins/liability/Comp/Lic/RRP/fuel etc...

and don't say "I work by myself I don't need comp") the only guy that doesn't need comp is the Maytag repair man. Bring on a helper for one day and he gets hurt say goodby to life as you know it. Ins is part of business, except it.
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Old 08-22-2014, 07:03 AM   #6
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Re: Starting A Small Carpentry Business


All very good suggestions, i can't thank you guys enough. Knucklehead, I live in Suffolk county but not to far out so I can work in both Suffolk and Nassau. I like that train of thought to work less charge more but in the past I've found myself taking on anything and regretting it later. At the company I've been with for years, I'm on the upper echelon of carpenters and problems are usually mine to fix and deal with. I get mostly unlimited permission to design and present to customers and that's a big advantage for me when it comes to going out on my own. This being a part time business I think your right about being profitable rather than always busy.
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Old 08-22-2014, 09:11 AM   #7
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Re: Starting A Small Carpentry Business


Take business classes. Get a good CPA. If you don't do both of these you will waste thousands of dollars.
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Old 08-23-2014, 05:39 AM   #8
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Re: Starting A Small Carpentry Business


An old ,rich client said to me "the harder you work the less you make''. That was told to me 25 yrs ago. Finally understand what he meant. Everyone tells you to work hard, work smart instead.

You could easily make more than your making right now working two days a week if you pick the right jobs and price them right. As long as you keep your expenses low. It's about making money not staying busy!
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Old 08-24-2014, 08:56 AM   #9
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Re: Starting A Small Carpentry Business


Do what you do well and hire subcontractors to do what they do well.
Manage them well and you will make money and have happy customers because of them.
Manage them poorly and you will find yourself losing both money and your reputation.
When I say manage, I'm talking about solid, well written Subcontractor Agreements and daily communication with them and the homeowners.
Communication and a passion for what you do is they key to success.
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Old 08-24-2014, 11:46 AM   #10
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Re: Starting A Small Carpentry Business


i prefer the work less and charge more way......go after higher end, charge more....but deliver the best quality/service

or go after low end, charge less, work more...get crappy customers

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