My start up plan

10848 Views 38 Replies 4 Participants Last post by hillsidepm, Jan 9, 2012

G

Discussion Starter · Dec 8, 2011

Hi all, I have been thing about getting into Reo and P&P business. I went to a voc.tech then college for light rez. construction and have been doing remodeling (job super) for 15 yrs. At this point in my life I feel like I just need a change. Over the past few weeks I have read all of the posts in this area many times. Please tell me what you think of my plan.
First of all I own generators, compressoers, ladders, 3 chain saw, mowers, trimmers, and every carpentry tool you can think of. I also have a private investor who has offered me up to 30K to get started. For collateral they have accepted a large parcel of land I own. The plan is to start a LLC in CT. and be based in MA. I would be looking to get a loan for a 3/4 ton diesel truck and buying outright a dump trailer. This way I could use most of the 30K for start up costs and working capital. I have a mentor/friend who is in the biz. and would want to work for me. At this time he runs crews and takes the pics. for a different p&p company. We would get started with just the two of us and if I could make it work the plan would be hire one or two more people. Run a 4 man crew for a while then start a second crew. I have a hand full of local realitors I know on a personal level I could turn to while I try to get in with a national. I have no doubt that I will have to be pounding the pavement with the local realitors and constantly on the phone and passing out information.
SO with that being said what do you pros think? Any pointers, help, or general directions would be great!!!! Thanks

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G

Discussion Starter · #2 · Dec 8, 2011

good luck

You should have no problem getting any work in Massachusetts.

I am literally swamped in Mass and I keep turning it away,I have been picking and chosing my work orders.

Are you ready to drive your 3/4 diesel truck 40 miles away for a $25.00 door lock change

50 miles for $20.00 trip charge

Take this into consideration before jumping into this.I have yet to get more than 30 per c/y in mass.

I can help you get into a couple regionals up here but the money is not great.Bid work is awesome but I have to take alot of low endwork before I get these bid jobs.

Start a mowing company and a handyman company instead of this.

P.s

FAS and Safeguard are all lcoked up in Mass.

Springfield Mass and worchester are real busy I have 5 work orders I can throw you,but bring some heat

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G

Discussion Starter · #3 · Dec 8, 2011

Great plan.......but,
Joe Blow is around the corner willing to undercut your prices by a long shot. If you read enough of these posts you will see some people who have been doing this for a while want out...BADLY! This business has hit the crapper from 6 years ago. Most of the companies out there are not paying what they were before, and the good ones have solid contractors that aren't giving up their spots. If you must endure this profession, best of luck.

IMHO, if you are stable in what you are doing now then keep doing it.

G

Discussion Starter · #4 · Dec 8, 2011

I looked at his plan and said why not start a handyman/lawn services.

If you know realtors I would have assumed they would tell you to run,I was under the assumation all realtors soon will have to go to nationals.

G

Discussion Starter · #5 · Dec 9, 2011

MKM Landscaping said:
I looked at his plan and said why not start a handyman/lawn services.

If you know realtors I would have assumed they would tell you to run,I was under the assumation all realtors soon will have to go to nationals.

Thanks for the input and offers MKM. But at this point Iam not 100% sure I want to pull the trigger on this plan. If it sucks so much why do you continue to do it? As for the 20 mile lock changes I have a 1/2 ton that can eek out 19-20 mpg. As it is now for my employer I travel 80-100 miles per day and front the money for fuel. Only to get rembursed months later. My long term goals would be to have clean outs as part of my biz. I would like to branch out to plowing, lawns, handyman, and landscape construction. I was just thinking that clean outs would give me a place to start from. It would also give me something new and exciting. I already work from dawn to dusk 6-7 days a week. The work doesnt bother me. But I have come to the conclusion that being a employee will not get me where I want to be in life. Thinking maby its time for some calculated risk.
Do you recycle much of the material you haul and how important is it to have a yard for storage?

G

Discussion Starter · #6 · Dec 9, 2011

i do the work because I have alot of full time employees that need to stay busy.I think this industry is tough but I don't think it sucks.

The problem is,this industry take years before you are successful.I have spread my wings out far for the last year and now I am starting to see rewards.The firsy 6 months was brutal being out 50 large but now i am getting check each week and it made it easier.

2nd most of landscaping and snow plowing is all national so I know how the scene goes.

National equal bulk work= low money
Local equal less work = lots more money

I just refuse to downsize or layoff.I care too much.

I don't recycle much but I don't do many trash outs.30 yard dumpsters up here are 800.00 too much money.I only do trash outs where dumpsters can put on sight,so I dont do many because I am not trying to work for 20 to 30 per c/y.

G

Discussion Starter · #7 · Dec 9, 2011

Its sounds like you are a good guy to work for :thumbsup:. I take it in your first 6 months it was tough because you were the untested new guy? How long ago were you the new guy and at first how frequent were the jobs coming in? What type of work were you getting? Thanks again for the input!

G

Discussion Starter · #8 · Dec 9, 2011

My first jobs where mostly trip charges,re keys,maids and lawns that looked like jungles.Took about a month of these jobs.

Got a invite to bid on big rehab,did great job and I know I shouldn't say this but Chase feel in love with my work and my prices and picked up a bunch more rehabs for them.

Took on some low paying routines 2 hours away and after 2 months received 40 of them that are now local.I love my routines,always a extra at each property.

i do a lot of board ups in Massachusetts.I have a regional who has crappy prices but pay threw the roof on board ups.

Just alone i ndecember we have already done 20 board ups and then you get the extra glass clean up,and the re clean and etc.

The other veterans make way more moeny than I do and have alot more info that I do.I am only speaking off Massachusetts.
I have a company who keeps calling for a bunch of work in western mass I just don't know how good they are yet.

Man if you have a guy willing to back you up 30 large jump in and get your feet wet.

Nobody ever dreamed of the schoolgirl nerd we all dreamed of the prom queen,winners get the prom queens.

My prom queen had 3 kids with me so my days are over off jumping in

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BPWY

· #9 · Dec 9, 2011

MKM Landscaping said:
i do the work because I have alot of full time employees that need to stay busy.I think this industry is tough but I don't think it sucks.

The problem is,this industry take years before you are successful.I have spread my wings out far for the last year and now I am starting to see rewards.The firsy 6 months was brutal being out 50 large but now i am getting check each week and it made it easier.

2nd most of landscaping and snow plowing is all national so I know how the scene goes.

National equal bulk work= low money
Local equal less work = lots more money

I just refuse to downsize or layoff.I care too much.

I don't recycle much but I don't do many trash outs.30 yard dumpsters up here are 800.00 too much money.I only do trash outs where dumpsters can put on sight,so I dont do many because I am not trying to work for 20 to 30 per c/y.

most of landscaping and snow plowing is all national so I know how the scene goes.

You must live and work in a huge metro area.

Because other wise most of the work out there isn't tied up with a national. There are far more home owners and small businesses that manage their own site than what go thru a nat.

In all my years of grounds maint I've yet to run across a national controlling the grounds maint.

G

Discussion Starter · #10 · Dec 9, 2011

Buy a truckmount carpet cleaning system that does both carpets and tile and hit the street knocking doors. You will make a ton more "take home $$" than you ever will doing the P&P business and a lot less headaches.

In the P&P business you are NEVER truly self employed and the Companies still control your destiny.

JMO

G

Discussion Starter · #11 · Dec 9, 2011

A BIG Amen to that Freemont! If nothing else you are simply a glorified employee who gets to proudly say you are a "contractor". If they say jump, you better be willing to say how high? Don't forget no such thing as a day off in this biz, you'll need someone to answer the phone or email at all hours of the day/night. Vacations are pretty much non existent (unless you have a crew/second in charge you can trust to get the job done right and close out the W.O.'s).
Simply put, even though you fee like you'll be taking the leap and plunging yourself into a road of prosperity....there are consequences. Your relationships both personal and professional will become strained (i.e. if you have kids/wife....forewarn them that there is now another family member that will be consuming the majority of your time, your friends...well plan to see much less of them) as this biz is a 24/7 commitment and only the strong survive.

Just my .02

thanohano44

· #12 · Dec 9, 2011

P3+ said:
A BIG Amen to that Freemont! If nothing else you are simply a glorified employee who gets to proudly say you are a "contractor". If they say jump, you better be willing to say how high? Don't forget no such thing as a day off in this biz, you'll need someone to answer the phone or email at all hours of the day/night. Vacations are pretty much non existent (unless you have a crew/second in charge you can trust to get the job done right and close out the W.O.'s).
Simply put, even though you fee like you'll be taking the leap and plunging yourself into a road of prosperity....there are consequences. Your relationships both personal and professional will become strained (i.e. if you have kids/wife....forewarn them that there is now another family member that will be consuming the majority of your time, your friends...well plan to see much less of them) as this biz is a 24/7 commitment and only the strong survive.

Just my .02

Exactly....

CSREO

· #13 · Dec 9, 2011

I would scrap the plan of spending the 30k on a truck and dump trailer. We started our first truck by buying a f250 from United Rentals for $3500 with only 48k on it, and bought a 15' dump trailer for $3500. Start with as few expenses as possible, due to the time it takes to get paid. Working with nationals will run you flat broke. If you have connections in with agents, go after them. We do not have one national, and yet we have ramained busy. More money, less headaches. Now we run a 15' dump trailer, 12' dump trailer, and 16' dump truck. Plus misc trucks for contracting type services that have misc tools and supplies kept in it.

mtmtnman

· #14 · Dec 10, 2011

FremontREO said:
Buy a truckmount carpet cleaning system that does both carpets and tile and hit the street knocking doors. You will make a ton more "take home $$" than you ever will doing the P&P business and a lot less headaches.

In the P&P business you are NEVER truly self employed and the Companies still control your destiny.

JMO

I'll add to this by saying you should get equipment to refinish hardwood floors. We are seeing more and more people ditch carpet for hardwood out here. Some of these 50-60's homes have BEAUTIFUL hardwood under the carpeting. A little refinishing and they look like new. Carpeting is on a downward spiral here. I'm ditching all the carpeting in this house when we finally purchase it due to the wifes Allergies..........

A little info here:

The changing of the generations could also contribute to a continuing shift to hard surface flooring. In 2007, Generation Y was more likely to purchase hard surface flooring and area rugs, while Baby Boomers and older generations are more likely to purchase wall-to-wall carpet. This trend indicates that the flooring market could increase its dependence on wood and laminate flooring, vinyl sheet and floor tile, and ceramic tile over the next decade. Currently however, Generation Y may prefer the lower-end lines of these markets, since their incomes are probably lower than their older cohorts.

http://blog.floorcoveringinstitute.com/2009/11/floor-covering-trends-target-generation.html

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thanohano44

· #15 · Dec 10, 2011

mtmtnman said:
I'll add to this by saying you should get equipment to refinish hardwood floors. We are seeing more and more people ditch carpet for hardwood out here. Some of these 50-60's homes have BEAUTIFUL hardwood under the carpeting. A little refinishing and they look like new. Carpeting is on a downward spiral here. I'm ditching all the carpeting in this house when we finally purchase it due to the wifes Allergies..........

A little info here:

The changing of the generations could also contribute to a continuing shift to hard surface flooring. In 2007, Generation Y was more likely to purchase hard surface flooring and area rugs, while Baby Boomers and older generations are more likely to purchase wall-to-wall carpet. This trend indicates that the flooring market could increase its dependence on wood and laminate flooring, vinyl sheet and floor tile, and ceramic tile over the next decade. Currently however, Generation Y may prefer the lower-end lines of these markets, since their incomes are probably lower than their older cohorts.

http://blog.floorcoveringinstitute.com/2009/11/floor-covering-trends-target-generation.html

I just ripped out all the carpet of my rental to lay tile. It's too damn expensive to keep replacing and cleaning carpet. Just get a damn throw rug.

I'm going to do it in my house later this month. You'd be surprised what you can get at EOM and EOY from distributors. Lol.

BPWY

· #16 · Dec 10, 2011

After our fire in 08 our new modular is 100% vinyl.

We plan to do tile and laminate on top of that in some of the rooms.

G

Discussion Starter · #17 · Dec 10, 2011

3

I highly recommend woven bamboo! Just laid it throughout my own house this summer and this stuff is TOUGH. I have 2- 150lb dogs and they can't scratch it. A little more expensive than oak, but right in line with the cost of maple or another exotic hardwood. I wouldn't go any other way after laying these wide 6" planks.

Mi Casa

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mtmtnman

· #18 · Dec 10, 2011

P3+ said:
I highly recommend woven bamboo! Just laid it throughout my own house this summer and this stuff is TOUGH. I have 2- 150lb dogs and they can't scratch it. A little more expensive than oak, but right in line with the cost of maple or another exotic hardwood. I wouldn't go any other way after laying these wide 6" planks.

Mi Casa

Where seeing a lot of that up here in new construction and remodels and a hell of a lot less carpeting...............

G

Discussion Starter · #19 · Dec 10, 2011

P3+ said:
I highly recommend woven bamboo! Just laid it throughout my own house this summer and this stuff is TOUGH. I have 2- 150lb dogs and they can't scratch it. A little more expensive than oak, but right in line with the cost of maple or another exotic hardwood. I wouldn't go any other way after laying these wide 6" planks.

Mi Casa

Looks nice. I'm a hard surface freak, love tile and hardwood.

G

Discussion Starter · #20 · Dec 10, 2011

It's the only way to go for indoor air quality. A lot of people are unaware of the actual carcinogens found in carpet. It's tainted with so many VOC's it's ridiculous. I'm not saying that there aren't any in hardwoods (because there are), but certainly less distributable than that of carpet.

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