How long did it take you to really get the business up and running?

Status
Not open for further replies.
B

bjp_ne_elec

Senior Member
Location
Southern NH
I'd like to hear from you folks out there, in regard to how long it took you to really get things up and running. And then maybe a description of how the first six (6) months went - and the next six (6) months, etc.

Things have been pretty slow, and I'm bummin'. Wanted to get some ideas from you guys - looking to see how you really got things going.

Thanks
 
a lot of variables at play...

what type of work? any previous connections? - i know guys who do custom homes who started day one with 10 employees and $1mil in work waiting for them...

how much capital do you have? how much can you spend on advertising? - there is an outfit around here who spent 10+ yrs as a 1-2 truck operation. They teamed up with a plumber and hvac, got an infusion of capital, spent $500,000 a year in yellowpage advertising and 4 yrs later have 40+ trucks and 80+ employees...

for a 1 man, shoe string startup...MD is pretty close...
 
True enough. If I had a half-million bucks, the curve would have been shorter. I wouldn't have wanted to go that route anyhow, because I have no idea how I'd have staffed such an operation. I'd be darned lucky if I run across one guy per year worth hiring.
 
Emahler - I'm talking a one man shop. Don't have many connections, as I'm new to the area where I now live. That's what I'm struggling with - as to how to "break the ice" so to speak. I'd like to get more commercial jobs, thinking it might a better chance for repeat customers. The new home starts around here are really slowing down, and it can get pretty cut throat.

How big is your shop? Did you start out one man, and then grow? At some point I'd like to be able to hire a person or two, leaving more time for bookkeeping, estimating, etc. for myself - but I've been struggling keeping myself busy.

Just getting started, so the advertising budget is pretty slow. Where do you guys feel that I can get my most "bang for the buck"? Do I run some ads in the newspapers in those Business Directories?

Oh - one more for Emahler - where did they get their infusion of capital from?

Thanks
 
bjp_ne_elec said:
Do I run some ads in the newspapers in those Business Directories?
Click to expand...
I'm not sure if that's good advice or bad advice, but that's what I did. I had a couple cheap ads in a couple little local papers every day for years. Costs about the same amount as a latte every day. It seems like after you get a certain amount of people in your client base, things just sorta snowball after that. Referrals, I guess.
 
I started on my own full time 2 years ago. I already had two builders I did resi for. I now have 4 builders, 2 house flippers, 2 small remodelers and a school disctrict that keep me busy Not swamped, but busy enough.
 
bjp_ne_elec said:
Emahler - I'm talking a one man shop. Don't have many connections, as I'm new to the area where I now live. That's what I'm struggling with - as to how to "break the ice" so to speak. I'd like to get more commercial jobs, thinking it might a better chance for repeat customers. The new home starts around here are really slowing down, and it can get pretty cut throat.
Click to expand...

it is cut throat...it'll keep you busy, but difficult to make money off of. Now, you can follow the Nexstar/ESI route (without joining) and offer the service to the customers. That's a possibility. For small commercial, make sales calls...If you have a job in a strip mall, go into the rest of the stores and introduce yourself...takes 15 mins and you never know. But whatever route you go, remember that you are ALWAYS selling...

bjp_ne_elec said:
How big is your shop? Did you start out one man, and then grow? At some point I'd like to be able to hire a person or two, leaving more time for bookkeeping, estimating, etc. for myself - but I've been struggling keeping myself busy.
Click to expand...

i'm a little different...i'm a 2nd generation idiot...before I came along fulltime, we were a 50+/- man union shop. That died in 1991 (anyone around at that time will remember the turmoil in the industry)...in about 1996-1997, I got into the business with my father helping me. We started on a shoestring, and didn't hit stride until about 2001 or so. We are now non-union, up until about 12-18 months ago we were 95% service work (60% commercial, 40% residential) and fluctuate between 6 and 12 field employees. In the past 12-18 months, we have changed to about 50% service (90% commercial, 10% residential) and 50% commercial new construction/TI's/etc. We have also been getting into the commercial HVAC and Refrigeration sectors.

bjp_ne_elec said:
Just getting started, so the advertising budget is pretty slow. Where do you guys feel that I can get my most "bang for the buck"? Do I run some ads in the newspapers in those Business Directories?
Click to expand...

look into a series of books by J. Conrad Levinson called "Guerilla Marketing" There are tons of low/no cost ways to advertise and market. But mostly, you have to have faith in yourself to sell yourself. If you sit back and wait for the phone to ring, it's gonna take awhile...go out and sell yourself.


bjp_ne_elec said:
Oh - one more for Emahler - where did they get their infusion of capital from?

Thanks
Click to expand...

wish I knew:D...they are in Satcom's neighborhood, he might know...
 
I've had people completely unrelated to the electrical business interesting in investing from time to time. That doesn't really appeal to me, because money always comes with strings. It will be like having a partner who wants a say that doesn't do any real work. Just my opinion. I'd rather own what I have.
 
mdshunk said:
I've had people completely unrelated to the electrical business interesting in investing from time to time. That doesn't really appeal to me, because money always comes with strings. It will be like having a partner who wants a say that doesn't do any real work. Just my opinion. I'd rather own what I have.
Click to expand...

i guess it depends on the amount and what they offer....

i'd rather own 10% of a $10 million company than 100% of a $1mil company...it works out to the same gross dollar amount, but one gives me all the liabilities, one spreads them out...
 
bjp_ne_elec said:
I'd like to hear from you folks out there, in regard to how long it took you to really get things up and running. And then maybe a description of how the first six (6) months went - and the next six (6) months, etc.

Things have been pretty slow, and I'm bummin'. Wanted to get some ideas from you guys - looking to see how you really got things going.

Thanks
Click to expand...

I went in just as a housing bust was starting, and it it took a good 4 years for the housing industry to come back to life, so jobs were hard to come by, so many of the EC's were bailing out, and others were taking on part time work doing just about anything to bring in some money, until things picked up, the good news was, there were plenty of auctions for trucks and tools, some of the stuff could be bought for 10 cents on the dollar. all areas of the industry were down commercial and industrial also felt the slow down, just make sure you have eniough put on the side for bad times, so you can down size and ride out the bumps.
 
If you're well capitalized when you start out then emahler's description is right on the money. But, if you're starting out with very little like many of us have then Marc's version is probably more accurate. I've been in my own business for about 12 years and that seems to be about the right time line.

I'm sure many guys have stories to tell but I sub-contracted for other EC's for several years before I got my first house to wire. It was small (probably 1500 to 2K sq ft) and I used a Milwaukee hand drill to drill all the holes. Needless to say, I burnt it out (didn't have a Hole-Hawg yet - couldn't afford it).

If you can get a few (guardian angel type) GC's to keep you busy that might be a good start. Someone gave me this advice years ago and I've taken it seriously - Don't hook up with a track builder. You'll have to take the jobs real cheap and they'll always keep you 4 or 5 houses behind in payment. When you finally get to the last house they close up shop as ABC contracting and open up as XYZ contracting the next day and you can't get your money.

Just my opinion.
 
Last edited by a moderator:
A LONG time ago I sent out a simple letter to every HVAC guy in the phone book...about 300 at the time knowing that they occaisionally come across elec work that they diodn't want or could not do.

For the youngsters, the "phone book" was a printed source of information, updated yearly, containing everyone with phone service. It was the olden days.


I also sent the same amount of basically the same letter to all electrical contractors trying to pick up any junk/extra work that they didn't want.


I got a few calls from the HVAC guys, nothing that really stands out but I got a CRAPLOAD of calls from the EC's and one of them lead to a good contract that spanned almost a decade.
 
220/221 said:
A LONG time ago I sent out a simple letter to every HVAC guy in the phone book...about 300 at the time knowing that they occaisionally come across elec work that they diodn't want or could not do.

For the youngsters, the "phone book" was a printed source of information, updated yearly, containing everyone with phone service. It was the olden days.


I also sent the same amount of basically the same letter to all electrical contractors trying to pick up any junk/extra work that they didn't want.


I got a few calls from the HVAC guys, nothing that really stands out but I got a CRAPLOAD of calls from the EC's and one of them lead to a good contract that spanned almost a decade.
Click to expand...
Good idea, i might want to try this. In your experience, didn't some of the EC's see you as competition? Did you only send letter to those of them you knew and were your friendly competions, or did you just blanket them all, picked out from the local phone booK?
 
bjp_ne_elec said:
Emahler - I'm talking a one man shop. Don't have many connections, as I'm new to the area where I now live. That's what I'm struggling with - as to how to "break the ice" so to speak. I'd like to get more commercial jobs, thinking it might a better chance for repeat customers. The new home starts around here are really slowing down, and it can get pretty cut throat.

How big is your shop? Did you start out one man, and then grow? At some point I'd like to be able to hire a person or two, leaving more time for bookkeeping, estimating, etc. for myself - but I've been struggling keeping myself busy.

Just getting started, so the advertising budget is pretty slow. Where do you guys feel that I can get my most "bang for the buck"? Do I run some ads in the newspapers in those Business Directories?

Oh - one more for Emahler - where did they get their infusion of capital from?

Thanks
Click to expand...
I have tried many different advertising routes: community phone book, craigs list (free), penny saver, valpak, bluebook, google, etc. To my experience, the best bang for the buck was with google online advertising. You have absolute control over the message, the geographic location of where it goes, the amount you want to budget for it, etc. Nothing is pre-paid, no long term contract, pay as you go, stop any time. I have had many inquiries from it. e/m
 
Energy-Miser said:
To my experience, the best bang for the buck was with google online advertising. You have absolute control over the message, the geographic location of where it goes, the amount you want to budget for it, etc. Nothing is pre-paid, no long term contract, pay as you go, stop any time. I have had many inquiries from it. e/m
Click to expand...
I've never used (or even been tempted to use) the Internet to find a local service provider of any type. For that reason, I am suspicious whether net advertising would work in my market. I suspect that it is more effective in metropolitan areas.
 
In your experience, didn't some of the EC's see you as competition? Did you only send letter to those of them you knew and were your friendly competions, or did you just blanket them all, picked out from the local phone booK?
Click to expand...

I'm sure SOME may have worried about me staeling their clients but obviously some did not.

The ones that called me just gave me the stuff they didn't want anyway.

I sent a letter to EVERY name in the book...about 300 at the time (1980)
 
3-4 years, in the first year or so I was ready to give it up on a daily basis, first year or two my men made more money than I did, went weeks at a time with no check, lost insurance, yada yada yada. But it finally started to work out.

23 years later I am still am not convinced it will work and avoid vacations.
 
Sometimes I wonder if I'm up and running yet...

Sometimes I wonder if I'm up and running yet...

I started the business in March of 2006, and went solo in Feb 2007... yep, that's this year. I've had my share of ups and downs.

I started off well with a decent commercial project. (For me that was $10k) and had some little side work for a bunch of people I had to take care of. Getting paid from contractors and businesses was hard. Especially getting paid on time...

After a month, I started using lead services like BidClerk ($40 / month) and ServiceMagic (up to $300 / month). They provided leads... so, most of the time, the customer wanted the work done. That's why they came to the website and posted their want. The problem was, there were at least 3 other contractors (ServiceMagic) looking at the same project, and up to 50 other contractors (BidClerk). ServiceMagic contractors were small, and used to working for near Journeyman wage, and not business mindset. (I had one guy bid $900 on a 900 square foot basement. He beat me by a long shot. I'm GLAD I didn't win.) BidClerk had more contractor minded companies looking at the projects. I called homeowners, and beat every contractor easily (to my own shame.)

I signed up with BlueBook, and got in with other contractors. Generals mostly. Some small, some large. I now get invitations to bid projects on a routine basis. The problem is, most of those projects only pay on a monthly basis. You have to invoice this month for the work you completed the whole of last month, to get paid next month...

I got in with some other contractors. They liked my work, and we are now their sole EC.

So, sometimes, it's hard.

I had so much work the last 3 months, I had to hire 3 guys... On Monday last week, I fired the last one...

So, I got ads out right now looking for more help.

I don't have much money in the bank, pay everything with credit cards, pay them off in full every month (almost always anywyas.) and have a good rapport with my bank. The contractors I do work with on a consistent basis pay me within 2 weeks, so that's a nice thing.

So... keep trucking. Don't give up. EVER!
 
brian john said:
3-4 years, in the first year or so I was ready to give it up on a daily basis, first year or two my men made more money than I did, went weeks at a time with no check, lost insurance, yada yada yada. But it finally started to work out.

23 years later I am still am not convinced it will work and avoid vacations.
Click to expand...
Are you glad you stuck it out, or wish you had gone back to work for someone else? e/m
 
Status
Not open for further replies.
Top