What did I do wrong? Do it for free

[bradleyelectric]

lots of companies advertise the lowest cost. it is not all that heard to be the lowest bidder.

its a very cheap way to get business.

let your competitor do the leg work and you take the job.

as long as you know exactly what you are doing, you can make real money this way.

and if the competitive bid is really a loser, you can always find some excuse not to take the job.

it may seem a little slimy, but it can be a very effective and profitable mode of operating.

Spoken like a true noncontractor. It can be used to get work, just not a way to get profitable work over the long run. Most contractors are not profitable.

 

[petersonra]

Spoken like a true noncontractor. It can be used to get work, just not a way to get profitable work over the long run. Most contractors are not profitable.

I would bet most contractors are profitable. otherwise they would find something else to do with their time.

 

[petersonra]

I would bet most contractors are profitable. otherwise they would find something else to do with their time.

Incidentally, I would also bet a fair number of small contractors are making no more in profits than they would be if they were an employee doing the same kind of work for someone else. Considering the additional time spent running the business, they probably are making less per hour than their employees.

But that is a very common thing for small business owners.

 

[ItsHot]

Cost to hang ceiling fan?

Cost to hang ceiling fan?

What do you charge to hang a ceiling fan? That is if you still do residential? I hear that Home Depot is charging $150 a fan.

 

[ItsHot]

please locate

please locate

What do you charge to hang a ceiling fan? That is if you still do residential? I hear that Home Depot is charging $150 a fan.

Moderators please locate new post! my bad!!!

 

[bradleyelectric]

I would bet most contractors are profitable. otherwise they would find something else to do with their time.

most do. 80% of all new contractors fail in the first year. 80% of the remainder fail before they are 5 years old. A lot of the small 1's that stay in business are retired and collecting a pension with benefits from a previous employment, have a working spouse that provides financial support and benefit package, or work somewhere else to provide benefits. If the business can't provide support for its principles than you can't really call it a profitable business unless by profitable you mean it provides the owner the ability to fish on a regular basis while the wife actually supports the habit. Your an engineer right?

 

[JohnJ0906]

80% of all new contractors fail in the first year. 80% of the remainder fail before they are 5 years old.

Where do these statistics come from?

 

[petersonra]

most do. 80% of all new contractors fail in the first year. 80% of the remainder fail before they are 5 years old. A lot of the small 1's that stay in business are retired and collecting a pension with benefits from a previous employment, have a working spouse that provides financial support and benefit package, or work somewhere else to provide benefits. If the business can't provide support for its principles than you can't really call it a profitable business unless by profitable you mean it provides the owner the ability to fish on a regular basis while the wife actually supports the habit. Your an engineer right?

I don't know if 80% of new contractors fail within a year, but I have heard statistics from reputable sources that indicate new businesses in general tend to fail at about that rate. Nothing special about a contracting business that would make me think they are likely to do any better.

I am not self employed, and really have no desire to be.

Most small business owners really don't do all that well for themselves, even those that manage to stick it out for any length of time. They often do it simply because they prefer working for themselves rather than someone else.

As for benefits, its not all that unusual for a spouse to take a job to provide health care insurance for both of them just because it is so hard to find reasonably priced health insurance coverage for one person. But really, a few thousand dollars one way or the other on health insurance is not that huge in the big scheme of things.

I know of a fair number of self employed veterans who use their VA medical benefits in lieu of buying health insurance. is there something inherent evil about that?

I know quite a few self employed people and I would bet the majority of them could make more money working for someone else.

 

[powerslave]

I know quite a few self employed people and I would bet the majority of them could make more money working for someone else.

That's because most small business owners don't charge what they should be charging. Small shops can be nickel and dimed to death in a heartbeat if they let themselves. The most common mistake is to charge the "going rate" and follow everyone else down the same hole.

Also, they don't charge for everything that they should be. Rule 1 The customer pays for everything.

 

[bradleyelectric]

As for benefits, its not all that unusual for a spouse to take a job to provide health care insurance for both of them just because it is so hard to find reasonably priced health insurance coverage for one person. But really, a few thousand dollars one way or the other on health insurance is not that huge in the big scheme of things.

I know of a fair number of self employed veterans who use their VA medical benefits in lieu of buying health insurance. is there something inherent evil about that?

I know quite a few self employed people and I would bet the majority of them could make more money working for someone else.

There is nothing wrong with someone getting insurance through a spouse or other benefit package. I just don't want to hear that it is a profitable business if a spouse has to take outside employment to provide for benefits that the company should be able to provide and taking time away that would be spend doing the things a spouse of a profitable business owner would be doing.

I also don't want to hear she would be working for the same employer if the company was making 16% or better after a 6 figure income was paid to the principle and all benefits were paid. That is irrelevant.

I believe the 80% came EMyth. That would make it a small business # not specific to contractors. I have it in audio format so I didn't look up a page #. Google didn't provide a good link. I'll contact the local SBDC to see if they can provide a firm number and/or link so we can refer to it when needed.

 

[petersonra]

There is nothing wrong with someone getting insurance through a spouse or other benefit package. I just don't want to hear that it is a profitable business if a spouse has to take outside employment to provide for benefits that the company should be able to provide and taking time away that would be spend doing the things a spouse of a profitable business owner would be doing.

I also don't want to hear she would be working for the same employer if the company was making 16% or better after a 6 figure income was paid to the principle and all benefits were paid. That is irrelevant.

I believe the 80% came EMyth. That would make it a small business # not specific to contractors. I have it in audio format so I didn't look up a page #. Google didn't provide a good link. I'll contact the local SBDC to see if they can provide a firm number and/or link so we can refer to it when needed.

I am not sure what the spouse of a successful businessman is suppsoed to do.

IMO, you do what makes sense for your own personal situation.

I do not think there is any reason why a small business person "should" make any particular percentage of sales, or whatever.

 

[bradleyelectric]

I am not sure what the spouse of a successful businessman is suppsoed to do.

IMO, you do what makes sense for your own personal situation.

I do not think there is any reason why a small business person "should" make any particular percentage of sales, or whatever.

Do you know any successful business owners?

Sure, do what makes sense for your personal situation. Don't try to tell me that someone that does electrical work as a hobby has a profitable business. They would than have a hobby they make money at.

That would be due to the fact you are not in business and have not been schooled in business finance.

 

[Sparky555]

I Googled?contracting business failure rate (w/o quotes) and first page included the following:

"The BLS report by researchers Amy E. Knaup and Merissa C. Piazza is based on business enterprises in ten major industries that began operations in March 1998 which they tracked through March 2005. Among their findings: 57% of new construction firms are no longer in business by the end of their fourth year in business and 70% have failed by the end of seven years. Only the information industry fared worse than construction."

Obviously most contracting businesses aren't profitable.

Dave

 

[petersonra]

Do you know any successful business owners?

I know a fair number of people who are self employed, and have been for many years. Whether they are a "successful business owner" by whatever standards you have created for such a thing may be something else.

Sure, do what makes sense for your personal situation. Don't try to tell me that someone that does electrical work as a hobby has a profitable business. They would than have a hobby they make money at.

If one makes enough to live off it is no longer a hobby IMO.

I am not sure why you are so obsessed over the level of profit someone has to make to be considered successful.

As I have said before, I suspect many, maybe most, self employed people could make more money working for someone else. But they are quite happy doing what they are doing, and you seem quite unhappy with your situation because you think you are not making enough money. Who is the more successfully person?

 

[bradleyelectric]

I know a fair number of people who are self employed, and have been for many years. Whether they are a "successful business owner" by whatever standards you have created for such a thing may be something else.


If one makes enough to live off it is no longer a hobby IMO.

I am not sure why you are so obsessed over the level of profit someone has to make to be considered successful.

As I have said before, I suspect many, maybe most, self employed people could make more money working for someone else. But they are quite happy doing what they are doing, and you seem quite unhappy with your situation because you think you are not making enough money. Who is the more successfully person?

You are right in the IRS does see a self employment situation that makes money 3 out of 5 years as a business and 1 that does not make a profit in 3 out of 5 years as a hobby. According to them hobby status is not making a profit in 3 out of 5.

Maybe I just look at it as a difference between being in a self employment situation and owning a successful business.

As far as making enough to live off of. I agree. If the spouse has to work to provide financial support and benefits is the self employed situation making enough to live off of or is it suplimenting the spouses income. I can see how making money at a hobby and not having to have a job would be fun.

The level of profit part comes from business finance information as to what makes companies look attractive to investors. I didn't make it up.

 

[tshea]

Where do these statistics come from?

90% of statistics are made up by 5% of the people 50% of the time. Thi sis a proven fact, 25% of the time.

 

[LawnGuyLandSparky]

I Googled?contracting business failure rate (w/o quotes) and first page included the following:

"The BLS report by researchers Amy E. Knaup and Merissa C. Piazza is based on business enterprises in ten major industries that began operations in March 1998 which they tracked through March 2005. Among their findings: 57% of new construction firms are no longer in business by the end of their fourth year in business and 70% have failed by the end of seven years. Only the information industry fared worse than construction."

Obviously most contracting businesses aren't profitable.

Dave

There is more to this statistic than meets the eye. Many small businesses, ESPECIALLY contractors, purposely go belly-up and reincorporate on a regular basis. Most if not all of the businesses assets are "leased" from another or multiple small business under separate legal ownership.

This way, when Joe of "Joe's Electric" tells you "I'm losing my shirt on this job" he's NOT telling you he's raking in the dough through other shell corporations he owns that are leasing "Joe's electric" the tools, the administrative support, the billing service, the vehicle leasing, etc...

 

[Sparky555]

There is more to this statistic than meets the eye. Many small businesses, ESPECIALLY contractors, purposely go belly-up and reincorporate on a regular basis. Most if not all of the businesses assets are "leased" from another or multiple small business under separate legal ownership.

This way, when Joe of "Joe's Electric" tells you "I'm losing my shirt on this job" he's NOT telling you he's raking in the dough through other shell corporations he owns that are leasing "Joe's electric" the tools, the administrative support, the billing service, the vehicle leasing, etc...

I guess I didn't see the footnote for contractors that are so enormously profitable that they go out of business.

Dave