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Discussion Starter · #1 ·
I've finally decided to take the plunge and bring on 2 great guys full time and I'm pretty f%^king excited. It's one of my best friends,(who is a master mason, landscape construction, formerly licensed plumber, etc....) he's also the guy who can somehow get more done faster than anyone I've ever seen. Other guy is his son who's skilled labor but not as experienced on all the same stuff. I've worked with both plenty before and they're my go-to guys for weekend help, etc..... previously.

I'm trying to decide how best to organize things though:
-Change business name?
-Get more official about sales and marketing obviously..... I'm old school
basically do nothing right now and it's all word of mouth/repeat customers)
-Son probably goes on as an employee, but I kind of want to be partners with my friend.(not sure what's the right strategy here though- my main point is compensating everyone really well and making sure guys get what they're worth)

Also, anyone here who's on the front range of Colorado- I'd love to to connect if you have any need for high quality fence, masonry, landscape construction work.
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Discussion Starter · #3 ·
Partnerships never end well

Mike
I don't disagree but am wondering if this is an exception..... probably dumb on my part. It feels more like a partnership than anything just working together- neither of us is each others' boss per se, we work together. Guess it's probably that I want everyone to 'have a sense of ownership', pride in work, etc.....

More I think about it, partnership is no good but I really want to figure out how best to compensate him as well as reasonably possible. I'm on the opposite end of the spectrum from bottom dweller 'pay as little as possible to maximize profits' perspective.

Thinking of base wage and some kind of bonus structure but I know that can make taxes even more interesting.......
 

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Your definitely on the right trail. #1 paying well puts you in front of the line. I’ve always paid my help well, always will. But — I expect top work & no redoing anything. My cut man is there, everything set up ready to roll @ 7 sharp & coffee pot set on the cut table for all. He don’t have to, but it’s his way of doing things. Otoh, best not bark out any wrong measurements as he’s subject to throw the hot coffee on ya & not blink. Respecting each other & safety always as well as staying on top of taxes are key. Your company, you decide pay bonus etc. You have to leave the friendship part out once you spool out until roll up. Forget a partnership it flat just don’t jive

Mike

Mike
 

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Discussion Starter · #5 ·
Thanks for the input Mike!
Your cut man sounds like my guy a lot- he sets the tone and expectations of everyone else onsite. My guy doesn't like talking any more than necessary unless it's directly about the task at hand. Just last weekend we're talking to a client when we showed up and after basic hellos he hangs out for maybe a minute then just grabs a shovel and walks off to go fix stuff that he noticed needed doing.

Very good point on the friendship stuff while working- I'm always leery of mixing business and pleasure but on the flip side have a problem with being too friendly about stuff considering it's MY show to run.
 

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I'm always leery of mixing business and pleasure but on the flip side have a problem with being too friendly about stuff considering it's MY show to run.
It is your show to run. It’s you business that’s going to feed your family. Can you elaborate

Mike
 

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Discussion Starter · #7 ·
It is your show to run. It’s you business that’s going to feed your family. Can you elaborate

Mike
Well I like working with people that I generally like as people.(but am familiar with the pitfalls of family businesses/groups of friends starting businesses) It's important to me that anyone working with me has the same mindset in terms of quality and respect for clients and their property.(I'm 99% residential and think building relationships with clients is pretty damn important) This is the beginning of me 'waking up' to the fact I cannot 'wear all the hats' and grow my company and $. I need to do the things I do best and find the best people to wear the other hats- then trust them to do so.

Mixing business and personal is a difficult balance for me; I'm certainly not the 'hardest' boss by any means. I legitimately care about people that work with/for me but know that's been taken advantage of before even by guys I could give 2 sh%^s about. Part of it is just the hard truth that there are lots of bs-ers out there and giving the benefit of the doubt easily just lets people know they can get away with it. Around here there's a severe shortage of good skilled labor so I've chalked it up to 'take what you can get' previously.


Not sure if that's exactly what you were asking......
 

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I've been a contractor for over a dozen years, I've hired lots of friends and I'm friends with a lot of my subs. The real pros - Never been a problem, ever. They are pros, they don't let personal get in the way of bidness.

The issues I've had were no biggie to me, I fired a close friend who was in my wedding and I'm his sons godfather, backed him up in fights, we are tight AF. Straight business decision, after 2 years he wasn't a good fit. Said it ain't working out, handed him his check and shook his hand. We're still friends. Several other friends and even cousins. Hired and fired my BIL after a year. Several subs we out grew or they changed directions. No skin off anyone's ass

When the tail gate drops the bull chit stops. Time to work. I'm steering the ship and if you ain't steering in the right direction I'll replace you, dont care who it is. Dont get me wrong, I'll try my best to help you get on track but if thst isn't happening we are going to part ways.

Not one of those friendships is stained now. Not one. 1) I'm not friends with wusses 2) I'm upfront about what I just said before we ever start.

That being said it seems to be a problem for most people, and I think that's because they have poor conflict resolution skills or - and this is fairly common among competent contractors - they don't want the opportunity for any drama. Lol

On partnerships, never had a time in a dozen years I ever wanted to end our partnership, and I think that's mutual. Thst being said I wouldn't ever be partners with anyone else. Just hire what you need.
 
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As far as legitimately caring for your people, that's good. 👌 That's exactly how I determine when someone needs to go, which always sucks, but I am responsible to the other men who work under our banner too, so be pretty selfish for me to give allowances to an amigo I wouldn't for anyone else. I hated thst chit when I was a hand
 

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Discussion Starter · #10 ·
Jaws,
Great points throughout- really like the "when the tailgate drops the bulls%*t stops" that sounds like about the best simple approach to it. Good point about being responsible for everyone means cutting the fat and getting rid of guys that aren't pulling their weight rather than cutting breaks. I'm shooting for working with/for 'real pros' only- just hard around here; seems like most contractors are dirtbag bottom dwellers with a network of similar; got 2 big construction defect jobs lined up right now as a result.

I'm not bad with conflict resolution but also let stuff pile up sometimes to where it becomes an- FU situation where I could have nipped it in the bud earlier on and not ended up there. At that point I'm prone to write people off entirely under the 'screw me once.....' concept.
 

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Do you have licensing laws in your state?

If so, why can't he be licensed, you put his kid on payroll and then figure a split on the jobs.

It can work out well that way. As long as you both know what the bottom line is at the end of a job.

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Discussion Starter · #12 ·
Do you have licensing laws in your state?

If so, why can't he be licensed, you put his kid on payroll and then figure a split on the jobs.

It can work out well that way. As long as you both know what the bottom line is at the end of a job.

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That was kind of my theory in the first place but it would be complicated. I'm supplying most all the tools, equipment, truck, etc.... He also really doesn't want to deal with 'the bulls^&t'- mostly just loves kicking ass working with an awesome end result. I'm a lot more comfortable talking/dealing with clients, pushing paper, etc....
 

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That was kind of my theory in the first place but it would be complicated. I'm supplying most all the tools, equipment, truck, etc.... He also really doesn't want to deal with 'the bulls^&t'- mostly just loves kicking ass working with an awesome end result. I'm a lot more comfortable talking/dealing with clients, pushing paper, etc....
Congrats on moving to the next level... (y)

Some things to consider... Growing your business to achieve next level of construction and project growth is one thing... growing it to make more money is another... while they can certainly go hand-in-hand, they're also not mutually exclusive... as one example, you're going to have to charge more to cover the loaded costs of employees and management of said employees... some guys grow in adding employees, under the premise they'll make more money doing so, only to realize that they could have achieved the same, if not more, of income growth by staying small, using subs, etc. without the added challenges that come with employees...

Adding a partner means you're not only reaching deeper into the kitty compensation wise (meaning you'll get less than you may have envisioned while growing), but also opens up your liabilities... a partner is someone who is invested as you are, financially, physically, etc. and one who can take your place if you're out of the picture at the drop of the hat to continue executing your vision for the company but it also means that you're sharing that vision and growth of the company and what that means as partners... you can already see a red flag in that he doesn't want to "deal with the BS"... owning a business is full of exactly that... and if you're the source of the BS he doesn't want to deal with, that can potentially cause issues if you're not of the same mindset and commitment... especially considering the other employee is his son whom he'll likely share more allegiance with in a dispute... so you'd have to ask yourself if your proposed partner would do as Jaws laid out and fire his son because he wasn't a fit or would he dump you...

His "partnership" is likely more stronger with his son than it would be with a friend, no matter how close... you look at him through the lens of the son of your friend, and he looks at him as son (whom he's bringing into an employment scenario)... you can tell that by your OP where you described your friend and potential partner as the one you're most excited about and yeah, he has a son who's not as experienced...

The list is long when considering a partner for a business, from financials comittment, resouce allocation, fair compensation for roles, to company vision and execution, to finances, to management, etc. and if you really plan on making him a partner, a crystal clear partnership agreement is a tool to help make that discussion happen and bring out any potential pitfalls and misunderstandings... one of the uncomfortable but necessary questions that should be asked is if his son wasn't a fit, how would you determine that as partners and what would happen if that were the case... you could both be of the same mind, but it's important to hash these things out in fairness to both of you, especially since it sounds like you're providing the resources to make it happen (finances, business structure, etc.)...

From your description, and goals of your friend versus what can be derived of your initial post, it sounds like you'd be better off starting out your relationship with him as PM for your company... partnership and/or ownership rights can always be conveyed later if things work out on that level...

It's an exciting and challenging chapter you're getting ready to embark upon... best of luck... :cool:
 

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Discussion Starter · #14 ·
Long f-ing day with craziness on this front....
So scuttlebutt word got out where he currently works,(fake ass 'high end' landscape company) that he was probably going to quit and come work with me.(still unclear the organizational set-up exactly but I'd told him he's worth at least $40/hr as an employee to me and would be running everything in the field) Owner calls him in this morning and says the whole company,(with 100 or so employees wouldn't survive without him) and offers a $20 raise from $25 currently. Guy is a dirtbag POS and offered him a 25 cent raise 6 months ago. Guy has probably made him over a million in working there for 8 years or so and now they figure out they've been f-ing him!?!?!? Needless to say I hate people that do business like that- I want the best guys and to pay them as much as reasonably possible- not be a complete greedy bastard.

While it may be a short term cluster for me if I can't get him to bail the silver lining is him finally getting paid commensurate with his skills, abilities, and productivity. I'm still pushing hard to get him on board and would love meeting with his current company's owner and offering to do some of their jobs as a sub. I seriously hate the owner- one year he promised profit sharing to all foremen, managers, designers, etc... in lieu of raises then refused to open the books at year end. Another good one was when he broke his neck surfing in Costa Rica and put up a Gofundme to pay for his medical ****.

Needless to say... crazy day and now I'll be up trying to figure out how to finagle this.
 

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Discussion Starter · #15 ·
Congrats on moving to the next level... (y)

Some things to consider... Growing your business to achieve next level of construction and project growth is one thing... growing it to make more money is another... while they can certainly go hand-in-hand, they're also not mutually exclusive... as one example, you're going to have to charge more to cover the loaded costs of employees and management of said employees... some guys grow in adding employees, under the premise they'll make more money doing do, only to realize that they could have achieved the same, if not more, of income growth by staying small, using subs, etc. without the added challenges that come with employees...

Adding a partner means you're not only reaching deeper into the kitty compensation wise (meaning you'll get less than you may have envisioned while growing), but also opens up your liabilities... a partner is someone who is invested as you are, financially, physically, etc. and one who can take your place if you're out of the picture at the drop of the hat to continue executing your vision for the company but it also means that you're sharing that vision and growth of the company and what that means as partners... you can already see a red flag in that he doesn't want to "deal with the BS"... owning a business is full of exactly that... and if you're the source of the BS he doesn't want to deal with, that can potentially cause issues if you're not of the same mindset and commitment... especially considering the other employee is his son whom he'll likely share more allegiance with in a dispute... so you'd have to ask yourself if your proposed partner would do as Jaws laid out and fire his son because he wasn't a fit or would he dump you...

His "partnership" is likely more stronger with his son than it would be with a friend, no matter how close... you look at him through the lens of the son of your friend, and he looks at him as son (whom he's bringing into an employment scenario)... you can tell that by your OP where you described your friend and potential partner as the one you're most excited about and yeah, he has a son who's not as experienced...

The list is long when considering a partner for a business, from financials comittment, resouce allocation, fair compensation for roles, to company vision and execution, to finances, to management, etc. and if you really plan on making him a partner, a crystal clear partnership agreement is a tool to help make that discussion happen and bring out any potential pitfalls and misunderstandings... one of the uncomfortable but necessary questions that should be asked is if his son wasn't a fit, how would you determine that as partners and what would happen if that were the case... you could both be of the same mind, but it's important to hash these things out in fairness to both of you, especially since it sounds like you're providing the resources to make it happen (finances, business structure,

From your description, and goals of your friend versus what can be derived of your initial post, it sounds like you'd be better off starting out your relationship with him as PM for your company... partnership and/or ownership rights can always be conveyed later if things work out on that level...

It's an exciting and challenging chapter you're getting ready to embark upon... best of luck... :cool:
I read your post 4 or 5 times- all very good points and super helpful; makes me glad to be a half-ass, piddly part of this 'community'- Thanks for taking the time to help me out navigating and thinking through this.

You're exactly right about the partnership stuff. Between him and I our skills are very complimentary and certainly overlap but are also very different- I couldn't step in and even come close to his masonry skills and general productivity; he'd lose his mind trying to deal with clients the way I do, etc... etc.....
 

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I couldn't step in and even come close to his masonry skills and general productivity;
With some time on the job & watching other pros habits/tricks, in short time you can. It takes some time but we all can master many trades w/some focus. Not saying you are, but don’t limit yourself to a few trades. If nothing else, it will give you the knowledge to deal w/premadonna subs that try to tell you how it’s done. If you know what they do or more, they can’t give you 20 excuses. You can bet your best side piece it will happen. A lot of contractors are caught up in tunnel vision

Mike
 

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Discussion Starter · #17 ·
With s

With some time on the job & watching other pros habits/tricks, in short time you can. It takes some time but we all can master many trades w/some focus. Not saying you are, but don’t limit yourself to a few trades. If nothing else, it will give you the knowledge to deal w/premadonna subs that try to tell you how it’s done. If you know what they do or more, they can’t give you 20 excuses. You can bet your best side piece it will happen. A lot of contractors are caught up in tunnel vision

Mike
Definitely true, I learn stuff all the time even from less skilled people sometimes. A big part of my plan is diversifying in terms of skillsets and opportunities- planning to have my guy do a lot of teaching too. It's a weird balance for me between trying to absolutely master something specific and diversifying skill sets.

I don't sub much out but would love to work in that direction in the future. I've given some thought to trying to collaborate more with some big custom builders I know- help them out when they're short guys and I'm not so busy just for that reason.
 

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It's a weird balance for me between trying to absolutely master something specific and diversifying skill sets.
Sounds like your young — have patience. If your good w/your hands, you can master any trade given time. It never hurts to observe & ask questions. Us ol hands are willing to help
I've given some thought to trying to collaborate more with some big custom builders I know- help them out when they're short guys and I'm not so busy just for that reason.
I’ve always — always had a few custom builders in my pocket that call me when their framer can’t cut a tough roof in, trim man too busy to do punch, base over tile, s/r patches, warranty, you name it. There is a market there if your well diversified. If another G.C. can call me instead of 4 or 5 trades to work a list, he saves tons of anxiety & headaches. But — you also have to know how to bill for those trades as well. Before I went to Atlanta a few weeks ago, a builder I know called & said he couldn’t’t get his framer back to punch a house. I said how much is left? He said $2400. Went & looked all it was 2 shower benches & blocking, a few collar ties & palm braces. Myself & my cut man 1 day. But — sometimes they won’t tell you what’s left so you have to know how to bill it. They know I do commercial though & may not be available, I make sure they know. Granted those don’t come every day, but it’s often a trip to the titty bar for the boys when they do. Diversify diversify

Mike
 

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Partnerships can be great until they are not! Treat it like the business is it.
  • Use a lawyer to draw up the partnership agreement complete with what happens if one person leaves (or dies). If your partner dies will his wife all of sudden be your partner?
  • You should keep a controlling interest. Don't do a 50/50
  • Define each person's role in the company.
  • Work on a business plan before consummating the partnership.
  • Define how disputes will be resolved. They will happen!
  • Determine the business structure. Corporation or LLC?
  • Try working together for a year before you do a formal partnership. In that time you'll have a chance to try it out before you make it a legal arrangement.
  • How will each of you be paid? What happens with any profit? (or loss)

You are most likely excited because you'll have someone to share your business with. It's great to be excited but don't move too fast. Do it right and take your time. It's a marriage in business and it can be very difficult to get out of.

Good luck!
 

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Your buddy may consider the $5 less you’ll offer a sufficient offset considering less people that he has to run and to be able to work with his son.

Can you keep him busy so you always have payroll at $40/hr 40hrs + payroll burden? That’s a lot of stress unless you have the volume coming in through the doors.


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