What it costs to be in business.

[Beth n Rod 1,279]

Most people who have been in business a few years now know that there is quite a bit involved with running a business and the costs that come into play usually are an indicator of your growth stage.

Friday while working on our Charity cleaning event, I suffered a severe sprain to my left ankle and foot from jumping down into some vegetation growth (weeds) covering an old stump left behind from what must have been a large bush. This will have me going through about 6 weeks worth of recovery including therapy while in the meantime, I am extremely limited to what I can do as I am now on crutches for a not yet determined duration.

This is a personal cost because it affects me outside of the business as well, and I found it ironic that it happened during an event that we were conducting for free to benefit those who live with handicaps of one sort or another that need advocacy for finding work.

Fortunately, we have health insurance to help where this is concerned and it is for this reason that we also carry Workman's compensation insurance for our crews in the event of an accident. Stuff happens...when you least expect it.

We also carry insurance on our vehicles, the drivers, the equipment and are also required to participate in unemployment insurance. The costs of insurance in each of the categories is quite steep but how it outweighs the actual loss in any instance, is it worth it to you? I know the answer for myself but wanted to offer this perspective for others to consider.

Other costs that become more frequent are repairs and maintenance on the equipment and vehicles. While advertising, office supplies, telecommunications pretty much flat line into a regular monthly figure, others tend to fluctuate and sometimes spike. Ordering supplies and restocking various depletable items can be quite high at times.

Buying fuel for both the vehicles and machines happens several times a week. The costs of these supplies has increased due to the costs of fuel that affect production, shipment, manufacturing and sale of them.

Costs are not always under our control is the point I am getting to and how we contend with them in the course of doing business is a challenge that most of us face each day. Our customers do not always understand the back of the house costs that we have no choice but to pass on to them as it is not a function of business to absorb them. We must make a profit or the business stagnates and will soon begin to lose money as economic factors impose forcing a decision: increase prices, cutback budgets, create ways to do business cheaper, find other less expensive services to offer or go out of business.

Many are in areas of economic distress and cannot raise prices much if at all and suffer the most. Others who are in areas of economic diversity also suffer to those companies whose operating costs are lower and can offer prices the consumer is willing to pay while those with higher operating costs face downsizing, layoffs and budget cutbacks in order to maintain their competitiveness.

What does it cost to do business?

How is your business doing?

Rod!~

[Kory 14]

Sorry to hear about that Rod. I guess we will be seeing more posts from you for the next couple of weeks.

[Paul Kassander 26]

Sorry to hear about your ankle, I hope it heals fast.

To me the most important insurance thet we have is the health insurance. I have all of my employees set up with HSA's and I for the most part require them to get it. It may cost me a bit more in expenses but I would hate to see them loose everything should somthing unfortunate happen. You never know when somthing like this will happen and while workers comp will cover you if it happens at work what happens when your goofing around with your friends playing football on Sunday and you break your leg?

The continual rise of expenses has always been a challange to adjust for, becoming more efficient is always helpful but that only goes so far. Shop around look for good deals on products and buy quality, a few dollas more now may save you tenfold later. Sometimes you just have to give those small price increase occasionally to stay in business and support a family. If you are able to provide quality, reliability, and value customers will recognise that and you will succeed.

[Beth n Rod 1,279]

Thanks for the sentiments Gentlemen, my question still prevails to others who would read this. The fact that this is not uncommon is a good reason to post here your responses.

What does it cost for you to be in business? (not in dollars but in scope)

How is your business doing?

What would you change now that you have some experience under your belt?

Rod!~

[Don L 14]

Rod,my condolences.

It's a great question.I don't have a hard answer.I will estimate 20-25%.It is a category that I must rise up,and master.

I do want to adress insurance.

I know that capitalism could not exist without insurance.It is a nessecary evil in my opinion.Nonetheless,it is.

The insurance co's have us by the berries.If you want to run a proffessional operation,you need proper coverage to compete.You are coerced by law(at least here in the people's republic of New York)to carry auto ins.Then there is worker's comp,and the medical ins.

These last two items have been foisted upon employers by the God forsaken,communist UNIONS.Why am I responsible for an employee's health ins.I don;t pay their electric bills,tax bills...what happened that we employers got hypnotized into thnking that is our responsibility!I want my employees to prosper,but they are not my CHILDREN.What is the matter with PAYING them well,and they being responsible for their own welfare!!!!!!

I am ranting to blow off some steam,but can you imagine the trickle down effect of us having discretion to spread OUR revenue,as WE see fit?Not the ins underwriters,not the tax man,not the union hacks(which includes all of the worthless polititions who love the communists).It is a great challenge,which instead of bowing to ,we must take action to pry their parasitic existance from our skin.It the entrepenure that drives America's prosperity,not the mega corps.This have been forgotten.This very truth must be re established in our minds,and if we don't stand ,it will be the end of us all.My .02 cnts

[wally carter 14]

Rod, I want to say first that I enjoy the web site that you and Beth have. It is well done. I broke my ankle once and know how that hurts. worse is the not being able to do something. For people like us being inactive for a while is o.k., but after a few days we want to do something. hope it heals quickly.

[HotShot 34]

What does it cost for you to be in business? (not in dollars but in scope)

How is your business doing?

What would you change now that you have some experience under your belt?

Rod!~

Great thread Rod...sorry to hear about you ankle, hope it gets well soon.

What does it cost to do business? I think it costs you, your life. If you want to be successful, you have to give it your all. I only actually work (clean hoods) about 20-30 hours/ week, but I'm always working. Everywhere I go, just about everything I do is work related somehow or another. It becomes a way of life when you own your own business. Sometimes, you just want to give it all up and say to heck with it...it's not worth the headaches, but when you've found something that you love to do, and you're good at it, and you can make good money doing it....your perspective changes. Don't get me wrong, if I had to go flip hamburgers to support my wife and daughter I would be the best flipper out there, but since I have been blessed enough to have the choice, I'm not going to let it slip through my fingers.

[Beth n Rod 1,279]

I agree with you that there is no turning back for me. Being self-employed has been the best move I could make. It does become a drain on your life as everything revolves around it and like was said, it seems like everywhere I go it is tied to work somehow.

I have spent most of my life working for others and got sick of being passed up for someone else who was better at kissing (bleep) than I was.

I cannot even bring myself to consider going back to work for someone else and realize full well that I have some growing to do in order to become better organized in my life and how the business affects it.

It feels like time to let the reigns loose a little and start delegating.

Rod!~

[Richard 17]

I to would like to take the opportunity to thank you for this forum as well as wish the best in a quick recovery.

What does it cost??? According to my better half "The lack of need for a decent wardrobe". When all you wear is company Golf shirts or company T's. In order to run a succesful business you must pay dearly at the beggining.

Didn't mean to take it so far off track.Rod and Beth, thanks again for a site that is instrumental in the ability to learn our trade.

[PressurePros 248]

It feels like time to let the reigns loose a little and start delegating.

Rod!~

You figured out the answer as to why your ankle was sprained. God is giving you a kick in the booty. I know how it is. I want to clone myself six times and be everywhere at once. I'm hoping this is my last season being in the field. I didn't buy into a job but it sure fels like that sometimes. Yeah I have all the rising costs of increasing labor force and what have you but I think the others nailed it.. the biggest investment is your time.

[Scott Stone 604]

My average cost of operations over and above employee salaries is about 25% for most aspects of my business. There are some areas where do to higher workmens comp premiums it goes up to 37% of my gross, over and above employee salaries.

As for working all the time. I don't. Sometimes I am able to take a nap.

[RCBill 14]

I know of a painter/owner that was hurt too badly to work. He had work pending when he went down. He paid his crews a certain number for a job. For instance, he told the guys, "I'll pay you $3,000 to paint this house, materials included". The job was completed. All parties were happy. Next. This piecework became his business model. He became successful, had time to start a real estate business, and consult.

He will tell people that getting hurt was the best thing to happen to him.

Rod, from my perspective, you have more going for you than this guy had when he went down. Maybe its time to 'go the next level' as they say.

[Jeff 232]

Rod,my condolences.

It's a great question.I don't have a hard answer.I will estimate 20-25%.It is a category that I must rise up,and master.

I do want to adress insurance.

I know that capitalism could not exist without insurance.It is a nessecary evil in my opinion.Nonetheless,it is.

The insurance co's have us by the berries.If you want to run a proffessional operation,you need proper coverage to compete.You are coerced by law(at least here in the people's republic of New York)to carry auto ins.Then there is worker's comp,and the medical ins.

These last two items have been foisted upon employers by the God forsaken,communist UNIONS.Why am I responsible for an employee's health ins.I don;t pay their electric bills,tax bills...what happened that we employers got hypnotized into thnking that is our responsibility!I want my employees to prosper,but they are not my CHILDREN.What is the matter with PAYING them well,and they being responsible for their own welfare!!!!!!

I am ranting to blow off some steam,but can you imagine the trickle down effect of us having discretion to spread OUR revenue,as WE see fit?Not the ins underwriters,not the tax man,not the union hacks(which includes all of the worthless polititions who love the communists).It is a great challenge,which instead of bowing to ,we must take action to pry their parasitic existance from our skin.It the entrepenure that drives America's prosperity,not the mega corps.This have been forgotten.This very truth must be re established in our minds,and if we don't stand ,it will be the end of us all.My .02 cnts

Whats up with you and Unions. You best be thankful for workers comp. otherwise you'd be paying for any of your employee's work injuries and it could cost you a lot more than your W/C premiums. I dont like paying WC but I rather that than cover a injury that cost 10's of thousands of $$$ or more

You call the unions communist, I call you a communist. You say screw the people/ the workers in all your postings, give the worker nothing. Maybe you should start a biz in China, they dont care about WC they dont care about health insurance. :rolleyes:

[Jeff 232]

Rod hope you heal quick good luck.

As my biz grows so do the expenses, its amazing how much money goes out every month.

I'm lucky to have 2 good workers, that if they have to can handle just about anything at a job sight, but i know they will never be me. I dont work every hour or even every day at the job sights. I wouldnt have time for everything else.

Hell these past weeks with 100degree + temps, I just said the hell with me washing every day. I had my workers do it and i took care of other company & personal business

I plan on only supervising with in the next 12-24 months.

Rod hope you feel better

JL

[John T 744]

Hey Rod I hope you heal at Godspeed(And i'm not even religious I just like the term:) )

Your answer is in you post. You and I are about the same age and its getting to the point that we must start delegating more and more. I still do a chunk of the work but everyday my body hurts just a little bit more. So far my left knee has been hurting for only about...6 months. I use to think that I could do this business untill I'm in my 60's..Now I'm slowly starting to realize that the only way this could be done is that I stop doing the physical work ASAP. I give myself another year at best for me to do alot of the physical work then its Delegate,Delegate,fire,fire,fire,delegate delegate etc etc.

[newlook 265]

Rod,

Sorry to hear about the knee ~ ouch!! Pray that you have a speedy recovery.

[Don L 14]

Jeff,

your point is taken about the worker's comp.I don't have an alternative answer,but there must be a better way.Until ..it just is.

Ok,ok...I will reign in my opinions about unions.I know that my generalizations don't apply to all involved,and if you are one of the exceptions,good for you.I will tame my tongue.No personal offence intended.Have a great day,Jeff.I am not a communist,cut it out.Hee Hee

.

P.S.

Now Jeff ,I don't say "screw the workers,etc in "all" my posts.I am aworker,as well as an owner.Probably like most of us are or have been.Accountibility,responsibility..that is the point.Take care Jeff.

[Jeff 232]

Jeff,

your point is taken about the worker's comp.I don't have an alternative answer,but there must be a better way.Until ..it just is.

Ok,ok...I will reign in my opinions about unions.I know that my generalizations don't apply to all involved,and if you are one of the exceptions,good for you.I will tame my tongue.No personal offence intended.Have a great day,Jeff.I am not a communist,cut it out.Hee Hee

.

P.S.

Now Jeff ,I don't say "screw the workers,etc in "all" my posts.I am aworker,as well as an owner.Probably like most of us are or have been.Accountibility,responsibility..that is the point.Take care Jeff.

Hey I really dont think your a communist or are you???????? LOLLLLLL Have a great one dude. We all make some great points

[Don L 14]

I don't care who you are ,that's funny.Ciao'

[Electro 14]

I run a union painting company in New Jersey so I understand how expensive running a legitamite business can be. I also own a software comany that shows you exactly what it costs you to run your business. I am showing a break-out below of a typical employee and their direct costs. (Click on image to enlarge)

[ATTACH]5314[/ATTACH]

add on top of this all of your office expenses, non-billable time for you the owner and you can see that you can't afford not to know the true cost of running your operation.

Sincerely,

Brian Drucks

[Beth n Rod 1,279]

Thanks for contributing Brian. I remember your presentation at Tom's roundtable in pa earlier this year. Very useful program. You can elaborate more in the vendors forums section titled "Showroom Floor".

Rod!~

[Beth n Rod 1,279]

Brian,

Please do tell the members here more about the program. :)

I'm sure all could benefit from it!

Beth

[Electro 14]

Thanks for remembering me. I just spent the day at a convention/seminar for the Pest Control Association. It is amazing that no matter what trade you are in (Powerwashing, Pest-Control or Painting like I am) how we all have the exact same issues. We think they are unique to our industry, but they are univeral to service oriented businesses.

The one thing I have found aftering traveling around the country talking to all types of trade groups is, ask any contractor how long something will take (i.e. how long to clean a deck, paint a room) they will give you roughly the same answer. Yet, ask them how much they would charge and the prices are all over the hemisphere. How can that be?

The reality is that most contractors have no idea what it costs to run their operation. We all sell the same thing, LABOR. So how much does that labor actually cost?

That is what our software does. It lets you know exactly how much your labor costs and what you must charge to recover all of the costs of running a service business.

It took my company over a year to develop this program and we had a staff of accountants, programmers and financial advisors to create something that would be, all inclusive, yet easy to use. So I understand that its more the norm, not to understand how to determine your costs.

My family has been in the paint business for 4 generations, I was taught everything there is about paint and wallpaper. The one thing I never learned was about how to run a business. Hopefully our program will help others speed up the learning curve.

I would be glad to offer any assistance requested.

Sincerely,

Brian Drucks

http://www.yourcostcenter.com

[Michael Ahr 14]

Rod, hope you get better soon. As far as the cost of running a buisness, well........I am still learning that one. I retired from my previous job (City and Union) and had to look for another. Power washing kind of fell into my lap. I am learning now how hard it is to run a biz. We are doing o.k. for a second year in a row and are growing work wise as we go along and learn.Thanks to the people on this and other boards we have learned what it takes to do the work the right way. For that I say thank you. I have to agree that time is the biggest investment. In my old job I would work 60-70 hour weeks and think nothing of it. Nopw it's 24/7.But, I love working for myself and have to agree wholeheartedly with Rod, I will never (with the grace of God) work for any else again. Mike

P.S. Brian, I may take you up on your offer as I am still trying to figure out all the #s.

[Ron Musgraves 240]

Rod get better, Keep spirits high!!!!!!!!!!