small company hurdles.

[Guest569]

Looking for advice from anyone who has grown from a 1 man band to multiple staff, mostly domestic.

May seem straightforward, but a genuine query on how you manage things as Im struggling a bit.

From my other thread you may know! I can be doing 3 rewires per week but mostly 2. This totally maxes me and my other guy leaving little time for anything else.

Im picking up loads of smaller work that Im determined not to turn down but Im really struggling to see how I can manage the whole operation. SO some questions to anyone in this position.Remember this is for small companies 1-5 men.

Quoting on work - Do you quote every job or would you/do you have anyone doing this or even trust an employee to do this for you? At the moment I could spend 2 days a week pricing work, but I need to be involved in the rewires for them to flow. This means Im pricing jobs at 9pm, No fun.

I have 2 vans. I plan to eventually send my guy out in the van and make him kinda self sufficient. Maybe I can price the job, but I want him to go and do it, get materials etc and report back all is good. He will have fuel card, accounts for wholesalers etc...I want to call the guy, give him the address and rest assured the job is done ,money is in the bank and his test results are genuine.

Do you check all your employees work ? Do you trust them to do work to a good enough standard when your not there ? Is it all about finding the right guys ? How do you monitor your men ?

For example over xmas Ive set up some new advertising campaigns which are doing well.I have a fair few rewires booked but my phone is going crazy for smaller jobs. Todays calls have produced around 3/4 jobs consisting of things like install a new shower supply with rcd, install a smoke alarm , move a consumer unit, add a few sockets. These jobs amount to a nice total but I can't physically manage them.

I don't know if its just me but the hardest hurdle Ive faced is putting trust and faith in guys to go and complete a job to MY standard. I know plenty of guys I could employ tomorrow but could I trust them with my companies reputation? I don't think so.

Ideally Id drive around all day pricing/quoting/invoicing/signing off and generally being the boss but if I did this now things would fall apart. How do you get round this ? How do you make that jump into delegating rather than grafting ?

If I sent 2 average sparks into a rewire it would take a week, so I still need to be involved with that side of things for now but It would be great having another guy jobbing and doing all the other bits. I just can't see how without a massive headache.

Would be great to hear from anyone who has overcome this hurdle or anyone with general opinion on it.

 

[Sintra]

IMO if you want to expand you have to learn to trust people end off. It sounds like you need a supervisor to oversee the installation works freeing you up to do the pricing etc.

 

[Guest569]

Yeah that would work but that would mean employing another person on another salary ontop of the workers. Im not sure its another salary I could afford.

I guess another problem is I don't have any solid contracts that I can make a forecast on and budget for another salary for a supervisor. I don't think we are at that stage yet.

Another question then, when you decided to put trust in guys and change the operation slightly, did you take a big drop on profits initially ?

 

[Sintra]

Lol I'm not an employer mate, I am a contracts supervisor for a decent sized company. I have a couple of people above me whom I hope trust me and also have guys below me that I need to have faith in. When I started with this company it was a small outfit like yours where the 2 owners where on the tools. Workload got too much so I was given the position of supervisor and would oversee the couple of jobs that where running at the time. Along with this I was doing the small works and callouts etc. So this would maybe be a roll you could use a supervisor for so that at the beginning they are still bringing productive money into the company even if it only covers your costs it still frees up a lot of time for you.

 

[Marvo]

Looking for advice from anyone who has grown from a 1 man band to multiple staff, mostly domestic.

May seem straightforward, but a genuine query on how you manage things as Im struggling a bit.

From my other thread you may know! I can be doing 3 rewires per week but mostly 2. This totally maxes me and my other guy leaving little time for anything else.

Im picking up loads of smaller work that Im determined not to turn down but Im really struggling to see how I can manage the whole operation.

With a very small business such as yours expansion isn't a smooth thing, you need to expand in definite jumps. At the moment you are doing everything by the sound of it including hands on with tools, quoting, supervising and probably most of the admin work as well. The next step is to get to the point where you have sufficient teams to warrant employing a supervisor. A supervisor should increase the efficiency of the installation teams and therefore you profit margin so he should in theory pay his own salary and at the same time he should also allow you to increase the number of teams and expand further.

Getting to the point where you can make that leap with a supervisor is the tricky thing. You need to expand to the maximum number of teams you run almost to the point of having a nervous breakdown and at the same time you need to grow your customer base or increase your workload through advertising up to the point where you're running at full capacity.

Then you need to start turning work away.

Yeah I know it sounds weird but you need to start turning away the low profit work and any work that's not really your core business. You can do this by quoting with selective profit margins so if a job is going to be a pain in the --- you basically overquote so you end up doing less and less of the jobs that you're not geared up for and hopefully increase your customer base further to replace them with jobs that are better suited to your operation.

If you can pull this off then what you've done is created a buffer which you can expand into. If you start another team for example you can start taking on more of the work by not overquoting then over time you need to grow your ideal customer base again to get back to the point where you're turning work away again and then expand again......and so on.

As your labour force increases in size the expansion process becomes a lot smoother and less traumatic, ie, if you only have one team and you increase to two teams you obviously need double the work but if you have 10 teams and you increase to 11 then you only need 10% more work. With a larger workforce comes greater flexibility but obviously at the cost of greater stress levels for the owner. The whole expansion process revolves around increasing your profit making work output and constantly sacrificing the non or low profit work to do this.

Remember that turn-over figures are just vanity. If you're winning a very high percentage of your quotes you're highly likely to be making low overall profit margins and eventually run into cash-flow problems. The winner of the game is never the guy that does every job that comes his way and plans his expansion on turnover rather than profit.

 

[Octopus]

You are caught between the devil and the deep blue sea. You need a "cheap" reliable self sufficient, qualified, competent sparky.... which doesn't add up.

Could you not "sub" some of the work to another spark you know for the time being, on a job by job basis, to avoid the issues with fixed overheads? You'd need to be clear with HMRC about CIS, and VAT with the tax man.

I think you need to talk this all through with your accountant..

 

[Welchyboy1]

This is such a big problem to solve, i have been in this boat for about 2 years, i have repeatedly been told the secret is to employ the right people to take over and manage the installing while you keep the work coming in..........



trouble is.....good luck finding a good enough spark who will look after your good reputation, keep your customers happy, not steal your work, do a decent job for an employees wage whilst your away finding the work.....reality is those kind of sparks are working for themselves already or soon will be, its why the domestic market is dominated by one man bands and always will be

you need to aim for bigger commercial installs if you want to employ more people and phase yourself off the tools


the best i have managed is to employ 2 average sparks/installers that i use for all my bigger jobs, i start them off and oversee them every day in the mornings etc but then shoot off to do service calls and smaller jobs and pricing

this is good when i have enough big jobs on but trouble when ive only got smaller stuff on, as 3 sparks and a plumber trying to fit out a bathroom at the same time is not ideal

i couldnt send either of them out to meet customers or do small fault jobs or servicing as they just havent got a clue when it comes to that and would only cause me headaches, allready been there

its a very hard thing to acheive, if you suss it out let me know please cause i cant for the life of me! Lol

 

[atm84]

How about getting your guys to carry out their work on a price? Say £300 per house. (you will know what to pay them better than me). That way they have an incentive to graft. One of my mates worked for a company that this. Obviously you need to make it clear that you expect a reasonable standard from them and that its not acceptable for them to just lash it in.

 

[Guest569]

Im glad others can relate to this as its a real issue for me at this stage.

Its just really hard to put everything into practise and make these jumps. When I started out I was actually making a lot of money with almost no overheads. Work as I wanted , few days off ? I took them, all was good.

Now things are getting complicated , I have overheads and guys depending on me. Its incredibly stressful BUT I know this is the only way to expand so Ill do it.

Getting off the tools even for a few days a week just seems a massive jump, I can't see it at all.

As mentioned above most guys are simply not interested. No one shares my enthusiasm for the company obviously and its highly unlikely Ill find a cheap, self sufficient spark working to a great standard.

So do we just take a gamble ? I constantly worry that employees are not completing things to standard. Lets say my guy installs something thats not right and goes on fire a few months down the line...how do you guys deal with that worry ? Insurance ? does that put your mind at rest ?

Subbing work - Yeah definitely possible, but again domestic market is all about reputation for me. Ive built my business using RatedPeople etc along the way. I have 72 excellent reviews on Rated People for example. Despite what people think of RP I get a lot of work through it. Ive completed every job on my own to ensure a good rating. In my opinion one bad ratings totally ruins that reputation..how could I send a subbie out to that job ? no chance !

Pricework - Definitely an incentive but the wrong one. This was my incentive for 10 years, the incentive was to get up the road as quickly as possible !

marvo - Turnover etc - good points. I think I could definitely increase my turnover by a fair margin but profits likely not much more by the time I factor in hassle, problems, quite weeks etc. I have been turning away a lot of work as it is. Enough work to create another position for someone if the guy was good!

Starting to think gaining contracts is going to be the only solution, where Ill have long periods of work available and can manage guys easily.

thanks for advice/opinions...keen to here more or if anyone else has similar problems.

 

[Octopus]

There is a thanks button bottom left side of each post - you CAN use it!

 

[atm84]

JRC why was price work the wrong incentive? Why did it want you to leave?

 

[Guest569]

JRC why was price work the wrong incentive? Why did it want you to leave?

Sorry may have worded wrong ...price work was an excellent incentive for me when I was employed by my former company. I knew as soon as I finished I was on the golf course, so generally everything was rushed. This was acceptable due to the low quality of work expected but on my private jobs I couldn't have guys rushing through just to get home early ..the jobs would be poor quality.

 

[Stuart12]

Stay small make money simple
Start employing people = hassle stress worry You think you are making money then someone takes you for a lot of money the HMRC take a big chunk then pensions NI contributions then you need office and staff to man the office whilst your out grafting to pay there wages whilst they play on the computer. You can not have a holiday because everyone phones constantly. Your staff take liberties when your not there costing you more money
It’s been a very big learning curve for me and going from myself to 14 staff working 7 days a week putting a lot of trust and money for training into them and to find myself getting let down constantly When you train them they then think they are better than they are and jump to the quickest job with a few quid a week more kicks you in the teeth when you have treat them like your our kids and treat them constantly
Constantly got other companies trying to rip you off then staff pinching cable etc for there guvvy jobs and using your vans for own use using your fuel and damaging your vehicles decreasing the value then costs of repairs kill you. When asked employee why have you left my van in this state he replied it’s only a works van I replied it’s my van that cost me £12k so if I did this in your car that cost you £2k would you be happy Reply from employee no but what’s the problem. Needless to say he did not last the day and cost me £1350 to repair


Best advise to anyone thinking of going bigger is
STAY ON YOUR OWN
there is very few lads left that are good and as listed above in another post if they are really good lads they have already gone on there own as they know what they are worth

Most lads think cos they have a few certificates they are the best sparkles going but the reality is they have done the tests in a class room and when they get in the real world they haven’t got a clue and it’s been proved to me numerous times in the ladt 3 years
Apprentices you are just paying to baby sit them complete waste of time and money

 

[DPG]

Stay small make money simple
Start employing people = hassle stress worry You think you are making money then someone takes you for a lot of money the HMRC take a big chunk then pensions NI contributions then you need office and staff to man the office whilst your out grafting to pay there wages whilst they play on the computer. You can not have a holiday because everyone phones constantly. Your staff take liberties when your not there costing you more money
It’s been a very big learning curve for me and going from myself to 14 staff working 7 days a week putting a lot of trust and money for training into them and to find myself getting let down constantly When you train them they then think they are better than they are and jump to the quickest job with a few quid a week more kicks you in the teeth when you have treat them like your our kids and treat them constantly
Constantly got other companies trying to rip you off then staff pinching cable etc for there guvvy jobs and using your vans for own use using your fuel and damaging your vehicles decreasing the value then costs of repairs kill you. When asked employee why have you left my van in this state he replied it’s only a works van I replied it’s my van that cost me £12k so if I did this in your car that cost you £2k would you be happy Reply from employee no but what’s the problem. Needless to say he did not last the day and cost me £1350 to repair


Best advise to anyone thinking of going bigger is
STAY ON YOUR OWN
there is very few lads left that are good and as listed above in another post if they are really good lads they have already gone on there own as they know what they are worth

Most lads think cos they have a few certificates they are the best sparkles going but the reality is they have done the tests in a class room and when they get in the real world they haven’t got a clue and it’s been proved to me numerous times in the ladt 3 years
Apprentices you are just paying to baby sit them complete waste of time and money

Blimey that’s a very negative outlook. If everyone had that opinion there would be no businesses operating!

And the thread is 8 years old.

 

[JBW175]

Stay small make money simple
Start employing people = hassle stress worry You think you are making money then someone takes you for a lot of money the HMRC take a big chunk then pensions NI contributions then you need office and staff to man the office whilst your out grafting to pay there wages whilst they play on the computer. You can not have a holiday because everyone phones constantly. Your staff take liberties when your not there costing you more money
It’s been a very big learning curve for me and going from myself to 14 staff working 7 days a week putting a lot of trust and money for training into them and to find myself getting let down constantly When you train them they then think they are better than they are and jump to the quickest job with a few quid a week more kicks you in the teeth when you have treat them like your our kids and treat them constantly
Constantly got other companies trying to rip you off then staff pinching cable etc for there guvvy jobs and using your vans for own use using your fuel and damaging your vehicles decreasing the value then costs of repairs kill you. When asked employee why have you left my van in this state he replied it’s only a works van I replied it’s my van that cost me £12k so if I did this in your car that cost you £2k would you be happy Reply from employee no but what’s the problem. Needless to say he did not last the day and cost me £1350 to repair


Best advise to anyone thinking of going bigger is
STAY ON YOUR OWN
there is very few lads left that are good and as listed above in another post if they are really good lads they have already gone on there own as they know what they are worth

Most lads think cos they have a few certificates they are the best sparkles going but the reality is they have done the tests in a class room and when they get in the real world they haven’t got a clue and it’s been proved to me numerous times in the ladt 3 years
Apprentices you are just paying to baby sit them complete waste of time and money

Bloody hell, that was some rant Stuart.

After 8 years though, he’s probably figured all this out for himself…

 

[Diddy]

Stay small make money simple
Start employing people = hassle stress worry You think you are making money then someone takes you for a lot of money the HMRC take a big chunk then pensions NI contributions then you need office and staff to man the office whilst your out grafting to pay there wages whilst they play on the computer. You can not have a holiday because everyone phones constantly. Your staff take liberties when your not there costing you more money
It’s been a very big learning curve for me and going from myself to 14 staff working 7 days a week putting a lot of trust and money for training into them and to find myself getting let down constantly When you train them they then think they are better than they are and jump to the quickest job with a few quid a week more kicks you in the teeth when you have treat them like your our kids and treat them constantly
Constantly got other companies trying to rip you off then staff pinching cable etc for there guvvy jobs and using your vans for own use using your fuel and damaging your vehicles decreasing the value then costs of repairs kill you. When asked employee why have you left my van in this state he replied it’s only a works van I replied it’s my van that cost me £12k so if I did this in your car that cost you £2k would you be happy Reply from employee no but what’s the problem. Needless to say he did not last the day and cost me £1350 to repair


Best advise to anyone thinking of going bigger is
STAY ON YOUR OWN
there is very few lads left that are good and as listed above in another post if they are really good lads they have already gone on there own as they know what they are worth

Most lads think cos they have a few certificates they are the best sparkles going but the reality is they have done the tests in a class room and when they get in the real world they haven’t got a clue and it’s been proved to me numerous times in the ladt 3 years
Apprentices you are just paying to baby sit them complete waste of time and money

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