December 30, 2021 was my last day on the job of over 8 years and today was the first day as a full time business owner. Any pointers as to what I should be on the lookout for in this new chapter of my life?
@lienbkhost I learned this the hard way. year one, $19k and just barely paid my bills, year two I made $40k and afforded my bills and expanded, year 3 I made $72k and I realized I way over spent. This year I am going to try and live how I did year 2, and save as much as possible, see whats there, AND THEN spend.... I do not regret buying my AC to stay alive this summer though. lol
@613jono If you're happy where you're at by all means stay in your lane and crush it. But as someone who started out in lawn care and moved elsewhere, your life will get so so so very much better if you break out into other services which are higher paying, more skilled and most importantly, viewed as being worth more. And not just worth more money, but you, your employees and your business are viewed as having more value to society.
The margins, the employee pool and the customers are utter trash
Lawn care is like the equivalent of roofing in construction
@whitesunshinee I would disagree in the margins. I'm a solo guy right now, and my expenses are maybe 10-12% of my sales as I don't take loans to buy my equipment. Maybe comparatively, but stand alone I don't think it's bad at all. Employees however.... I agree. Lol
@lienbkhost Yes, Yes, Yes! Most businesses seem to fail because the owners go out a buy cars, and live like there already rich. Then they miss a tax payment, then another……..
@more2much I’d like to add one point to this. Invest (wisely) in your company. For example, we have a videoproduction heavy business. A connection/friend has a similar business. He bought an expensive car and we bought video equipment. Guess who’s doing better? We are. Driving an expensive car is great, but having a Mercedes doesn’t add any value to your clients. Making better products, offering better services and improving the experience for clients does. If anyone’s wondering, we invest things in the following way: if we don’t use it often we rent it. If we tent to rent the same equipment over and over again and we know we can make our investment back in a reasonable amount of time, we buy it. Usually we make our investment back in 6 to 12 months, just by charging the same price a rental house does for that piece of equipment.
I’ve seen business fail because they want to save save save and save. Not because it’s wise, but that’s what you are supposed to do as a business. So there is definitely a balance to be found for everyone
@amydcohen Thank you for that advice. I am a bit struggling in terms of where I should be investing. I work from my home office so sometimes I am tempted to rent a proper office space. I also made a mistake of buying new equipment only to find out later that I could have purchased them used for way cheaper. I am learning though and getting better and better. Thank you.
@cree4christ Is say a little bit of "worry what's in the bank" is good. Helps cover slow months. Set a minimum limit and freak out when it goes below that.
@insearchofrationality Oh man f*ck dealing with other businesses. Despite having a unique understanding of how much payment delays wreck havoc on a business they seem to be the worst about paying their bills on time.
I have a flat out no b2b policy. Private residence or kick rocks. Even, and especially, HOA's. I'll work with a business long before an HOA. The only time I've had a potential customer tell me "well we would have been such great exposure for your business" was an HOA. And it's happened twice. "Oh we manage over 2500 homes.. we would have been great exposure for you..." Yeah.. except those 2500 homes (which were most likely almost all condos) are contractually obligated to have you handle the work that I'd be hired for. So no, I'm not losing 2500 potential customers. Im walking away from one huge problematic one. One which gives people crap about "being so unprofessional" for telling them three times not to contact me anymore.
@insearchofrationality It's not even specifically B2B. You just always need to know what work is coming in next. For my company, I know I'm fed this week and next. My concern right now is what will I be working on in 3 weeks. Once that week is booked, what am I doing in 4 weeks?
@cree4christ Where where you when I just started. I literally learned that the hard way in the early months when sales weren’t as good. Thank you for those wise words.
@more2much The two best pieces of advice if gotten are
Don't be afraid to overcharge.
Most new owners, particularly in the service industry, struggle to charge either going rate or what they need to in order to make a profit. I struggled with this my first couple years. If you don't have anyone saying your prices are too high it's because they're too low. You want to regularly have people turn you down because your prices are too high. This sounds backwards but it's the absolute truth.
Remember the 80/20 rule
80% of your problems are caused by the bottom 20% of customers and services/products. Cut them out and suddenly life seems like a cakewalk...until then next dumpster fire. But seriously, don't be afraid to tell people no. Customers will push and push and take every bit they can, set clear boundaries and hold to them. Many people think that because they're paying you for a service that they own you. I've had more than one customer literally take a step back in shock when I told them that what they're asking me to do is not part of what they hired me for. (I'll still do it but it's a separate job with separate cost)
