Planning a start-up.

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BroadviewElec

Member
Hi, I'm new to the forum. I have been in the electrical industry for about 10 years now. Currently I am head of the electrical department in a paper converting plant. I have residential and commercial experience also. I have quite a bit of tools and equipment already and have some funds set aside for more equipment. I would like to start of this business as simple as possible. I have my insurance quotes, DBA, tax info and all that. I am in NY so I don't need an electrical license, although I plan to test for it so I can work in VT also. I would like to keep my full-time job, my hours are 6-2 so that gives my some hours during the week to work and also work on the weekends. I plan to start REALLY small. I will have hardly any overhead so I don't see a problem with only getting a few jobs here and there. I would do this until I get a feel for the business and make some contacts and get things lined up. My ultimate plan would of course be to go full time on my own but I wouldn't be in any hurry. I am currenly drafting my business plan and gather as much info as I can. Any help will be appreciated. I'm sure you guys will see plenty wrong with my ideas but I'm here to learn. So let the flaming begin...
 
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aline

Senior Member
Location
Utah
BroadviewElec said:
I would like to keep my full-time job, my hours are 6-2 so that gives my some hours during the week to work and also work on the weekends. I plan to start REALLY small. I will have hardly any overhead so I don't see a problem with only getting a few jobs here and there. I would do this until I get a feel for the business and make some contacts and get things lined up. My ultimate plan would of course be to go full time on my own but I wouldn't be in any hurry.
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I would base your prices on what they would need to be if you were running your business full time even if you're doing it part time. This will give you an idea of what you will be up against as far as being able to sell the jobs at this price.

If you can't sell the jobs at this price know how are you going to be able to sell them at that price when you go full time?

Since you only need to get a few jobs here and there you don't need to worry about trying to beat the other guys price just to get the job. You can concentrate on learning how to sell your jobs at a higher price than the other guys.

If you can sell jobs at a higher price I can assure you that you won't have a problem selling them at a lower price if neccessary. :)

Not much fun quiting your job and having to raise your prices only to find out you have a hard time getting enough work at your new prices.
 
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aline

Senior Member
Location
Utah
Dnkldorf said:
2 free tips

1. Don't take business advice from someone on the internet, you don't know.

2. Start here
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I agree.

In my opinion the best thing to do is decide what kind of business you want to have.

Then find companies that are successful at operating the kind of business you want to have.

Then find out what they do and how they do it.

I think this will increase your odds for success much better than following the advice of someone on a forum that you know nothing about.

Including me and the guy with the 2 free tips. :)

That's why I posted the link to the book by Frank Blau.
He's been there and done it.
 
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C

CopperTone

Senior Member
Location
MetroWest, MA
Dnkldorf said:
2 free tips

1. Don't take business advice from someone on the internet, you don't know.

2. Start here
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you say don't take business advice from someone online and then direct them to an online business advice website? huh?

- I say this - only you know how hard you will work at your own business. It is much more work than you think it is. It is not as profitable as you think it is.
It is rewarding though when you are sucessful.

And - this is a very difficult time to start a business. Best of luck to you I say.
 
Rewire

Rewire

Senior Member
Location
Lake of the Ozarks
If you want a hobby try golf or maybe fly fishing that will be a better use of your spare hours and a lot less stress.The electrical contracting business is not set up to be done part time,some guys do "side jobs" but most will tell you that these are far and few between and most do not operate as a business.

The problem doing work after hours and weekends is many places are not accessable on weekends and in our city noise ordinance would come into play on after hour work.Plus if you have questions for other trades they will not be around.

Talk with tradespeople in your area they will give you a better perspective

"To discover new oceans you have to loose sight of the shore"

good luck and welcome to the forum
 
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JWCELECTRIC

Senior Member
Location
Massachusetts
If you want a hobby try golf or maybe fly fishing that will be a better use of your spare hours and a lot less stress.The electrical contracting business is not set up to be done part time,some guys do "side jobs" but most will tell you that these are far and few between and most do not operate as a business.

I agee it is not a Hobbie! But if you are serious enough, start off with small jobs after hours and weekends while you still have your current job. Then if busness picks up to a point where you have more work than your time to complete them, make the leap. For me it has been 8 years on my own, and looking back the only regred is as my wife would say "Should have done it sooner" She goes to the bank with the checks!

- JWC
 
Dnkldorf

Dnkldorf

Senior Member
CopperTone said:
you say don't take business advice from someone online and then direct them to an online business advice website? huh?
Click to expand...

Score is a great free tool, you can have one on one mentoring with former execs from a real diverse backgrounds. They can help you in a ton of ways. And they have offices all over the country. You have to see where your closest office is at.

All Volunteeers offerring unbiased information.

I'm surprised you may not know who Score is.
 
Fulthrotl

Fulthrotl

~Autocorrect is My Worst Enema.~
Location
HB, CA (19 Hrs. 22 Min. from Winged Horses)
Occupation
E
aline said:
I recommend reading this article from PM magazine.
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yup. this was a good read, and seems to describe many of us all too well.... :D

as for advice on the internet, a large grain of salt is in order... it's sorta like
internet dating.... don't believe anything until you know the person face to face.

friend of mine puts it this way: the internet isn't real, because you can't see
their lips move when they lie.:D

the cut and try method has taught me that flat rate pricing is about the only
way to approach this. my most profitable excursions are for flat rate...

the only time i won't want to flat rate something, is a bottomless hole that
there is no way to see the scope of the work...

someone asks what your hourly rate is, (and around here, the 50th percentile
is $75) and there you are.

somebody asks you how much a service upgrade is, and you say $2,500, and
there you are. that's the fair market value for a service change around here.

i'd rather be doing service upgrades for $2,500 than for $75 an hour.
the only reason i wouldn't, is if i didn't know how, or was lame and seriously
slow. call it a days work, back off the material of 600 tops, and you are
left with 1900.

do it the other way, add a third to the material, and you've got a $600 day,
plus $200 on the material. you are left with 800.

you don't know me, and can't see into my eyes when i lie, but you can rest
assured, if i have to choose between making 1800 or 800 for the same work,
i'm probably gonna choose 1800...... that may be the only statement i ever
make here you can trust.... :wink:
 
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wireguru

Senior Member
dont operate under a dba. incorporate (or LLC), obtain taxid number and DNB number for the business. once you have this, open seperate bank acccount(s) for the corp, get debit card, have checks printed. Do not comingle funds. Do not EVER pay a supplier from your personal account. If you need to loan funds to the corp, deposit a personal check in your corp account then pay out of that, making an note of the loan. Deposit all payments you receive in the corp account and write yourself a check when you need to get paid. Dont ever pay personal expenses from your corp account. Get a corporate credit card (you will still have to personally guarantee) to use for purchases when you need -never use your personal credit cards for your business.

if you are working out of your home, dedicate a space to the business and lease it to the corp. Write up a lease at market value, and make sure the corp pays it to you on time.

A few tips to appear professional:

Purchase a domain name for your business, and have a simple, but nice looking (not 1998 frontpage looking) website made. Make sure the domain name isnt too long, and is not easily misspelled. Most people cannot spell many words anymore.

Use 'yourname@yourdomain.com' for your email address, not 'misterelectricman193827@aol.com'.

Go to your favorite voip provider that lets you select numbers, get two in sequence, ex XXX-XXX-2500, XXX-XXX-2501. Use the first number for your business line, use the second number for fax. Forward the second number to a fax to email service, or use vonage fax service if youre using vonage. You can set your business line to forward to your cell when you arent home, give out your cell number if you like but dont list it as your business number.

Once you have your inc or LLC, (doesnt even need to be the same name as your contracting biz) file a DBA for the inc or llc with the name of the contracting biz, so you may conduct business as 'electriccontractor' not 'electriccontractor, LLC -this looks cheezy like you are trying to say 'hay look everybody! i have an llc and am therefore legitimate, it really works the opposite.


-and the most important piece of advise: Do not take a job, if you cannot afford to not get paid for the job.
 
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Dnkldorf

Dnkldorf

Senior Member
Fulthrotl said:
the internet isn't real, because you can't see
their lips move when they lie.:D

you don't know me, and can't see into my eyes when i lie, but you can rest
assured, if i have to choose between making 1800 or 800 for the same work,
i'm probably gonna choose 1800...... that may be the only statement i ever
make here you can trust.... :wink:
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Bravo........
 
B

BroadviewElec

Member
Thank you all for your advice. It's all been good reading. Good stuuf there wireguru. I was planning on just doing the DBA but I will definitely reconcinder that. Keep the responses coming!
 
B

BroadviewElec

Member
Wireguru,
Thanks for the great advice. Everyone else too! I only have one question about your response, do I need to be an LLC to open a business bank account? I thought I could with a dba?
 
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