1-year old General Contractor: My accomplishments, work week, bills, and questions!

[james17]

@mightygodam Ir depends on the agent but every agent should need a contractor that can handle a punch-list of repairs necessary, either ones that the seller has identified or repairs required after the inspection. You'll need a minimum dollar amount, 250 or something, to keep from people calling you about $25 fixes.

Also, commercial agents and people like me that sell to investors ALWAYS need work done. I sell to investors as well as flippers and we need licensed contractors every single day. In five minutes I am e-mailing three names of contractors to an couple who live 2000 miles away that bought a duplex and it needed bathrooms updated and some other stuff.

Offer 10% of the contract price to the agents and build it in to the price, if you have to.

 

[researchguy]

@james17 My company specializes in IT and related construction. I.e we install both the systems and supporting infrastructure (network cabling and electrical) for phones, cameras, computers, etc. I've always felt that referrals from realtors would be a huge opportunity, but like OP, even after making attempts at networking we've never received a single call.

Are we too specialized for referrals from realtors? I wasn't sure if offering 10% to agents would be seen as ethical. Do you or /@lynettetyler have any other advice on actually getting referrals from realtors?

 

[lynettetyler]

@researchguy Sounds like you specifically should be focused on commercial agents- and again you have to keep on the agents; one meeting/phone call won’t cut it.

I am extremely loyal to my contractors.

For example just today I have referred my plumber and designer to clients seeking help.

 

[james17]

@researchguy I agree with ecowley and would add that I'd look at the types of installations you do and what types of buildings use your stuff. Is your customer base consistently one or another type of property? Then look for agents that specialize either in commercial properties or high-end homes and talk to them in person. E-mail and phone ONLY to make an appointment to sit with the agent for 15 minutes. You have a service and product that many agents need.

 

[613jono]

@mightygodam Not the realtors you're after. It's the property managers.

 

[mightygodam]

@613jono How do I find them?

 

[slyanimal]

@mightygodam one way to maximize the value of your realtor network is to make contact with their preferred lenders, especially the loan officers providing FHA loans which oftentimes require improvements which can be the difference between a realtor’s commission and nothing.

another way to get into the fold is to get ahead of foreclosures and houses suitable for flipping. if you’ve a good relationship with a realtor, see if they’ll do an automated flexMLS list for you that drops relevant houses (in, say, a 30mi radius) into a list every evening. you can then position yourself as the go to in making sure those property values are being maximized.

lastly, you could make or have made via Fiverr a simple “how to increase the value of your home by $10k” infographic with your branding and hand that out, drop it in mailboxes, or collect emails to build a prospect list by providing something valuable and thoughtful.

 

[mightygodam]

@slyanimal Awesome advice, thank you! I'm going to get my realtor license this winter once the construction slows down a little. Is it illegal for me to market my construction services to my listing homeowners in order to get their house sale-able, and is it illegal for me to market to the buyers for remodeling work they may want done after they purchase a home? TIA

 

[teresafiatlux]

@mightygodam I had a Electrical Contracting business for 10 years and what I learned is that YOU are the best advertisement for your business. Being at the site, being at the wholesalers, talking to people, industry events etc. Home builders associations are great too because most of your larger work will come from specifiers (interior designers, architects etc). Marketing to the end client will do for now but you should be finding time for these events.

And to find that time, you need to automate as much of the billing, invoicing and estimating as you can. You are generally the only person that can do this well but as you get busy it can steal all your time. Time you should be spending marketing YOURSELF with the people who will end up being your clients.

I have worked with many software platforms that can help with this. Feel free to PM if you want more details.

Good luck!

It also seems to me I was very profitable with me and one apprentice and even two. But then there was this huge growth period where costs to support staff (training, benefits, tools, vehicles) outstripped the work I could find while setting all of this up, getting it running, hiring new staff AND trying to estimate and invoice. So having some money in the bank and an automated estimating / invoicing system before growing too much would save you some of the pains I went through.

 

[jonyjam_123]

@teresafiatlux Can you suggest some automated estimating software that you’ve found useful? As a new GC, this is my biggest pain. It just takes soooo much time, and thinking it may not be accurate keeps me awake at nights. Thx.

 

[mightygodam]

@jonyjam_123 I've learned all the sq. foot price for sheet rock, painting, flooring, fences, decks, framing interior walls, baseboards and painting baseboards, concrete, etc. I keep them listed on my clipboard I take on every bid walk so I can start figuring on the job and give the client an idea of how much is what.

 

[james17]

@mightygodam You didn't include Home Advisor in your cost list, btw. An average of $120 per actual contracted job seems like a poor return for advertising there. You also have to amortize the costs of the 50% of those leads that choose not to use you into the jobs you DO get. Are the Home Advisor jobs thousands of dollars each? Does not seem cost effective at all.

 

[mightygodam]

@james17 95% of my jobs exceed $1500 and I don't touch anything less than $500 except for my repeat customers. They are always calling to replace shower hardware or replace a door,etc. I would say my average profit per job is close to $1000. My concrete work I profit $1500-$4500 which is 20-25%. My fences are $400-$1400 profit which is a much higher percentage. I can make a great ROI painting a house.

 

[researchguy]

@mightygodam My advice from personal experience: make sure to write invoices. Don't get behind no matter what. Lack of cash flow will kill your business.

 

[mightygodam]

@researchguy Cash flow has almost killed me a half-dozen times. It is the exact reason I want to get with a builder and do 100 fences or driveways, or whatever! Anything that I know will keep it flowing for a while and give me the stability to try to grow. I feel like I'm always just maintaining.

 

[patricia1213]

@mightygodam Lets jump into pm. I was in the construction business for 4 years and can hopefully shed some light

 

[angelmraven]

@mightygodam Just beware that builders often do minimum net 30 and it's not uncommon for it to be net 90+. Also they will squeeze you hard on pricing.

 

[mightygodam]

@angelmraven Good to know. NET 90 is impossible for me. I could maybe do NET 30 as long as they do pay. I'll have to include some hefty late payment charges I suppose.

 

[darw]

@mightygodam You can probably get them to pay a portion upfront to cover material costs. Makes the net 30\90 easier to handle.

 

[chupee]

@mightygodam Im 3 years in and I waited way too long to get a book keeper. Mine does everything on the cloud. I just scan my receipts and she does everything else. Gives me so much more time to Invoice/ Estimate, and I scan everything before I invoice it so I don't get behind, writing the bills I can skip through the receipts I've uploaded on my computer much quicker than looking through a stack of paper.

I got some questions for you, do you only subcontract other people who have their own businesses or do you have employees? I do basically all my work myself and with my 3 employees because I dont want to leave the quality I am known for to subcontractors. I would have a hard time finding guys I trust and in my area atleast I dont think theres even many solo guys available.

Wouldn't they make more money doing jobs they find themselves? Do you charge way more then they would charge to profit? or just charge a percentage on there labor?

What have your experiences been like with subcontractors doing all the work? arent you worried about the quality of work once youre trying to do such high volume and theres no way you can oversee everything?