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  1. #1
    Join Date
    Mar 2004
    Location
    Ohio
    Posts
    259
    I want to start my own business, but I see how quickly companies come and go. I was wondering if you think it is better (or more secure) to just be one man in a van (maybe one other guy) and just work your piece of the pie or try to grow and get big. I've noticed there are few middle sized companies. They are either the "Big" boys or a small company. What is your take?

  2. #2
    Join Date
    Nov 2001
    Location
    Seattle, WA
    Posts
    7,711
    I have found that over the years I have no choice but to stay small for a whole bunch of reasons, mainly financial. Now I control each and everything I do and my customers like that. If I expand I will need to find labor which is almost impossible these day. If I do look for labor then I am in competition for the same guys/gals that are now working for other companies so I must, in some way, outbid their present employers. This escalites to an unbeleivable labor burden on me. Everything about my business immediately gets complicated and expensive.

    My business insurance, truck insurance, L&I insurance will go through the roof according to my insurance guy. My pricing structure will entirely be run by my added business costs of just have one employee.

    Plus in our state so many licenses are now required that finding anyone who has those licenses is tough unless you want to start with a newbee...but then he/she can't work at the level I need.

    I could go on and on. The decision has been made for me in this new world of our with layers and layers or rules/regulation, shortage of skilled workers, increased risk costs, etc, etc.

    So I line myself up with other one man shops and we work together. I pay them their going rate and they pay mine. I don't mind paying their rates since they can and do the work of 3 skilled men becasue of their skill level. And I do the same for them, I hope.

    And the bottom line is selling boxes is what this industry is all about mostly, not service or repair. I still believe in installing things so they will work and keeping them maintained so they will last long. My belief seems to go against the grain of the business world so I am probably on my way out anyway. But I don't want to find myself in the same rat race as most of the companies I know about and follow around that could be featured in Their Own Wall of Shame for a number of years.

    If you know a better way, let me know.
    "The American Republic will endure until the day Congress discovers it can bribe the public with the public's own money.
    - Alexis de Toqueville, 1835

  3. #3
    Join Date
    Nov 2004
    Location
    SW FL
    Posts
    5,994

    Thumbs up Great Writing and Philosophy

    DeltaT has
    The Right BALANCED Approach
    to business and life.
    Designer Dan
    It's Not Rocket Science, But It is SCIENCE with "Some Art". ___ ___ K EEP I T S IMPLE & S INCERE

    Define the Building Envelope and Perform a Detailed Load Calc: It's ALL About Windows and Make-up Air Requirements. Know Your Equipment Capabilities

  4. #4
    Join Date
    Mar 2004
    Location
    Ohio
    Posts
    259
    That is what I was thinking too. I se happy techs/owners, but they seem to get stressed out and not enjoy the job anymore when they get bigger.
    What has been your stategy during the slow times...besides maintenance agreements? Are home warranties a good supplement?

  5. #5
    Join Date
    Nov 2000
    Location
    Eastern PA
    Posts
    68,852
    A lot of it depends on you and your abilities. I did very well as long as it was myself and one or two helpers when I did the custom built homes exclusively. During a home building boom in the late 70s and 80s I did well running 5 crews on semi-custom built homes that were relatively the same.

    As a commercial/industrial sheet metal fabrication and installation company I found the larger my company got, the more I worked with no added financial compensation. This was due to my being good at the operations but not so good in the business end.

    If you are not a business man, stay small. The downside is that you can never grow the company into a sellable entity. If you are a good businessman, I hate putting it this way, but you probably would not be asking this question.
    Government is a disease...
    ...masquerading as its own cure…
    Ecclesiastes 10:2 NIV


  6. #6
    Join Date
    Aug 2002
    Location
    Office and warehouse in both Crystal River & New Port Richey ,FL
    Posts
    18,836
    It really up to you.


    Growing pains are many,but it can be worthwhile.


    If you stay small,do yourslf a favor,charge close to what the larger companies do,make more on less work,and put that money into a retirement fund ,or save it to grow on later.


    To many ,work very hard ,for a very long time and end up with very little in the end.

  7. #7
    Join Date
    Nov 2000
    Location
    Eastern PA
    Posts
    68,852
    Originally posted by dash
    If you stay small,do yourslf a favor,charge close to what the larger companies do,make more on less work,and put that money into a retirement fund ,or save it to grow on later.
    Very good advice.
    Government is a disease...
    ...masquerading as its own cure…
    Ecclesiastes 10:2 NIV


  8. #8
    Join Date
    Mar 2002
    Location
    Concord, CA
    Posts
    2,633
    They've covered the topic at hand masterfully. (Damn Delta! It's like you were writing my biography.)

    What I'd add is that you had better have the bug to start a business in a bad way. You may initially find yourself working one hell of a lot more for the same or less money. Or not. Some people get lucky and/or really know how to drum up business. But if you're like me and you're not a business genius and you don't have a huge ready made customer base, then you are going to work your @ss off in a major way in the beginning. Then as the biz matures it'll get easier and the payoff will come.

  9. #9
    Join Date
    Jan 2005
    Location
    Bakersfield, CA
    Posts
    209
    Irascible, sorry to butt in on this issue, but...

    I am really impressed with your website and I was just wondering how it is working for you. You have obviously put a lot of time and thought into the topics and links.

    Has it paid off in new business, or is it just for your personal satisfaction?

  10. #10
    Join Date
    Nov 2001
    Location
    Seattle, WA
    Posts
    7,711
    Originally posted by dash
    It really up to you.

    Growing pains are many,but it can be worthwhile.

    If you stay small,do yourslf a favor,charge close to what the larger companies do,make more on less work,and put that money into a retirement fund ,or save it to grow on later.

    To many ,work very hard ,for a very long time and end up with very little in the end.
    Dash is right almost as usual

    The first things most guys who head out on their own do is price themselves for failure not realizing the true cost of this business. If anything, stay at the market BUT, mostly, understand your own TRUE cost and price yourself accordingly. The feeling of having more mony left over at the end of the month along with being able to invest back into the business is one of the greatest feeling there is. Being able to afford the necessary tools, training and time off keeps you even sharper then your competitors who are driving themselves into the ground. We all know them. Some of "them" are us.

    I mainly do troubleshooting. My tools are top notch, many and expensive so I charge more. But my customers don't complain because I get the job done where others have failed usually over and over again. And they are impressed when I leave one of my expensive temperature/humidity recorders at their home/business/complex/wine cooler/pool room, etc so they can see in hard copy that their system is truly working the way is was designed. Plus they know I just left an $500 to $800 instrument at their place so I must be pretty sure I'm gonna get the job done or they can hold my instrument hostage.

    And be very selective of your customers. This is the hardest thing to do...and that is to say "no" to someone who calls for service/repair/replacement. Diceman wrote a pretty good article about this. Get him to put his article on here again. It's worth the time for each of us to read it again.

    I have always found that when I turn down a customer or fire a customer (yes, I fire at least 2 a year) within a short period of time someone shows up better to replace them.

    Set yourself away from all the other companies around you. It's easy to do these days. Just do what you say you are going to do. Show up when you say your are going to show up. And if you can't do the above just tell the customer the truth. They will usually respect your honesty and wait until you can do their work right.

    Know your limits too. Only do what you know you can do and have total control over the job. Treat the customer like you want to be treated cause we all are customer too!

    This world is starving for talented, honest, hard working, skilled people who keep their word. We are in a time when small business can and will prosper and are required and desired by all of us...but we need to do something about the layers of burecrates creating burdening financial and legal rules and regulations for the interest of creating money for themselves at our expense.
    "The American Republic will endure until the day Congress discovers it can bribe the public with the public's own money.
    - Alexis de Toqueville, 1835

  11. #11
    Join Date
    Mar 2002
    Location
    Concord, CA
    Posts
    2,633
    Originally posted by nathan9999
    Irascible, sorry to butt in on this issue, but...
    E-mail me.

  12. #12
    Join Date
    Mar 2004
    Location
    Ohio
    Posts
    259
    Originally posted by RoBoTeq

    If you are not a business man, stay small. The downside is that you can never grow the company into a sellable entity. If you are a good businessman, I hate putting it this way, but you probably would not be asking this question.
    I'm not looking to get rich. I am an engineer that worked in the field while going to school, but I have always wanted to be my own boss. I'm not bad at business, but nothing compares to the advice to the ones who have done it and KNOW. I pride myself on learning from other's mistakes or success.

  13. #13
    Join Date
    Nov 2004
    Location
    SW FL
    Posts
    5,994

    Lightbulb BE TRUE to Self

    Originally posted by DeltaT
    Originally posted by dash
    If you stay small,do yourslf a favor,charge close to what the larger companies do,make more on less work,and put that money into a retirement fund ,or save it to grow on later.
    BUT, mostly, understand your own TRUE cost and price yourself accordingly. The feeling of having more mony left over at the end of the month along with being able to invest back into the business is one of the greatest feeling there is.

    And be very selective of your customers.

    Set yourself away from all the other companies around you. It's easy to do these days.

    Just do what you say you are going to do.

    Show up when you say your are going to show up. And if you can't do the above just tell the customer the truth.

    DeltaT is HOT = Most Genuine Person
    with the most well-written, basic, principled statement
    that I have read in a L O N G Time.

    Delta T, Thanks for Being You.
    Designer Dan
    It's Not Rocket Science, But It is SCIENCE with "Some Art". ___ ___ K EEP I T S IMPLE & S INCERE

    Define the Building Envelope and Perform a Detailed Load Calc: It's ALL About Windows and Make-up Air Requirements. Know Your Equipment Capabilities

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