Been around the industry for a while. (employee status)I am at a cross roads in my life and need to make a decision about the future. Concrete work (flat work )and doing slipform work.. For the last couple years been thinking about going into the business for myself. What do you think about the timing of starting it now and with considerations about the present economy?. Just got a lot on my mind and looking for some knowledgeable opinions.
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Pending Economy
- Thread starter wattson
- Start date
dayexco
Senior Member
i hear there's going to be a recession...i've elected not to participate.
I am not opting for a recession either. I am just going to be putting a lot of money out for the initial investment in equipment . Plus going from employee status to employer status . I am just trying to get opinions from people here that are in different situations across the USA, which construction trends are different from West to East coast at the same time .A change in my life which hopefully will be a good one.
DPete
Senior Member
It depends on your area, we just finished a 5 year boom here so now would be a bad time. My equipment is all but paid for otherwise my head would be on the chopping block. It looks slow for a couple years, not the environment to start out on.
I'd just add be very careful in not overextending yourself. There are a lot of contractors around that are slashing rates just to get work. Payments will come month after month whether you have work or not. I'm not saying it can't be done, but it will be a lot tougher to survive than in better economic conditions.
jmac
Senior Member
I agree with Steve ( I do most of the time anyways). Most start up's don't have the money to last long enough to cover over head. How much money do you think it will take to get started and how long will it take you to cover over head. Who knows, only you? I know that you are getting older every year ( by the way you can't stop the clock, I tried no luck) and it is harder the older you get so no matter what the econo is today, start as soon as possible, you can find a reason every year of why you shouldn't, if it was easy every one would do it. It takes a big set of oranges to do it and a confindence that you can do it that will get you started, then lots of work and the willingness to put all the money made back into it for while. If you have bad credit, don't bother, good credit is a must.
As far as funds go, I should have enough money with the initial equipment/tool purchases. No banks needed .Also I am contemplating a line of credit with a bank versus spending the actual physical money I have for a PART of this..My credit should not be an issue l, I safe guard it dearly. Do not get me wrong ,but I understand that starting a business is tough. I already realized that this venture will own my A$$ for a couple of years already.I am not shy at all in putting in all the work plus the hidden work that no one sees plus reinvesting in the company over time too. As for the other things like the first insurance payments are going to be an issue that has to be paid as seen fit. Acquiring employees as the jobs see fit would be an issue I will have to decide when the situation presents itself. Doing the actual work on site is not a problem. It is the business end which I know pretty well, but still need to learn more in that department. Just a lot of things to think about and trying to cover my bases. Also considering what state the economy is in too.Just trying to make sure I can survive the down times when starting out new.I appreciate the experienced opinions here.
DPete
Senior Member
If you're going to do it I suggest you put it on paper and see an accountant with what you think will work. There are things like self employment tax, payroll tax and workmans comp you need to be aware of before you start. It's worth the $$ to get a professional opinion on your ideas. Other than that good luck to you.
jmac
Senior Member
Like DPete says, good accountant and attorney are a must, they can give
you much needed help with the paper work. The workers comp is only if you have employees. I started as a one man show and hired day labor ,the help sucks but I just kept sending them back and asking for some one else, took a while before you get someone that will work. I did this for the first couple of years before I could put together a good enough package for a full timer.
you much needed help with the paper work. The workers comp is only if you have employees. I started as a one man show and hired day labor ,the help sucks but I just kept sending them back and asking for some one else, took a while before you get someone that will work. I did this for the first couple of years before I could put together a good enough package for a full timer.
I say go for but dont burn any bridges when you leave this job . try to take the tough jobs no one elses want that will get you a quick reputation as a go getter and remember dont over spend on equipment . rent if you need to but keep your payments down . insurance and tax man are always breathing down your neck . good luck .
I totally agree about seeing an accountant about his opinion. As far trying to not burn a bridge down when I leave my present job. Well I work for a company that does the same work I am trying to get started on my own. Will be their competition. I do not have good instincts about what is going to happen when and if this materializes and is publicly known. That is one of my main concerns involved in this deal. Thanks for the info.
Willis Bushogin
Senior Member
new business
General Libility Ins also a requirement ($2500) in most cases this has to be paid up front. A lot of jobs, you have to buy the materials up front and then wait for your money, the waiting and the always there, the (non payers) can be tough sometimes, even if you have good credit and a good line of credit, you can possiblity get in with bad jobs and mess the line of credit thingee up
quick, so be careful if you decide to be the boss. Then you have employee issues, they all think they are worth more money (human nature thing)
In my opinion, if you have a good job, at least stick with it until all this recession stuff gets better.
My advise is not on the positive note. Things are bad now, hoping it get better, but Im afraid it will get worse. If you have the go-nads to try, do your homework, its easier to work for someone else, in this bad times. This is just my opinion and experiences. In my area workers comp, is required my all the contractors I work for, regardless if you have employees or not ($2600)
General Libility Ins also a requirement ($2500) in most cases this has to be paid up front. A lot of jobs, you have to buy the materials up front and then wait for your money, the waiting and the always there, the (non payers) can be tough sometimes, even if you have good credit and a good line of credit, you can possiblity get in with bad jobs and mess the line of credit thingee up
quick, so be careful if you decide to be the boss. Then you have employee issues, they all think they are worth more money (human nature thing)
In my opinion, if you have a good job, at least stick with it until all this recession stuff gets better.
GaryKelley
Well-Known Member
Nobody ever accomplished anything by NOT taking chances, However, speaking from experience (trust me on this), operating with a LOC as a back up, is not a good plan. I did the same thing, and now find myself "making payments" on a LOC to make up for a sluggish economy. Certainly not the BEST time to start a venture without a generous amount of CASH reserves, I hate to throw water on a fire, but from all indicators, the building/construction side of the economy is going to be in the basement for quite some time, I am planning on being a bottom feeder for the next 3 years, and that doesn't take into consideration how HIGH fuel prices are going to be.
I, for one am not too enthusiastic about the outlook for new, small scale construction starts for quite some time.
Why not, keep the job you have, and work part time (= weekends) on this new venture...I wish I had done that. I probably wouldn't be doing it now..
I, for one am not too enthusiastic about the outlook for new, small scale construction starts for quite some time.
Why not, keep the job you have, and work part time (= weekends) on this new venture...I wish I had done that. I probably wouldn't be doing it now..
I have been and planning this for a while.I feel it is never a good time to start. Just like having kids, was there ever a good time to have kids?I am doing my homework and trying to play/plan every situation in my mind.Still there is going to be something though. As for keeping my job and doing this in spare time would probably be hard. When I am at work, I am not going to be able to promote business. When I am done for work that day, so is everybody else. How can I talk with potential clients while at work ? Also how can I do this kind of work on weekends and spare time?Just a couple of thoughts within this ordeal. Just a lot to think about. I really appreciate all the help.
jmac
Senior Member
Another point that I forgot to mention is contacts. If you have no contacts in the biz, the only way to get work is by advertising. This is very expensive and takes a long time. IF you are lucky enough to know potential customers already, and you have a reputation that you can be proud of, than this could make all the difference in the world. I would also suggest going at it 100% or nothing because to make it work it will need 100% of your time and sitting on the fence is harder because the guys you are competing against are in 100% so they will have an advantage. Don’t start out half cocked, now how much it will take to get started and have the equipment to be competitive and how much you need to support yourself and have a plan, I think that you will need enough money for at least 6 months to carry you with no work if you have contacts in the biz.
Willis Bushogin
Senior Member
starting a business
1. money in the bank
2. family situation (married, kids, health ins.) forgot the family dogs
3. credit rating
4. equipment needed to buy
5. workers Comp (In my area this has to be paid, no payments) $3000.00
6. General Liability Ins (mine is $3500 a year)
7. Transportation
Im not sure what you need to do your work, but what have you got to purchase? You need a good accountant to keep you out of trouble. You will need the above insurances, to work on most jobs. Most of my jobs, you have to pay up front for materials and then wait to get paid, can you handle this?
Go get some credit with whomever you will be working with, (concrete company, materail supplier) before you quit your job.
Get your company titled as a LLC or INC, to protect your home, etc
Get brochures and Bus cards made and pass them out, if you can find a address, mail it to them, this is hard work, if you do it right.
Do you know how to price a job? lot of cut throating now, during this slow time.
Do you get along with people, if not forget it.
OK Im finished, these questions do not need an answer for me, it was for you to ask yourself honestly. I own and run a land clearing and mulching business, its good to have your own business when its going good, but when the accountant says you owe the IRS $10,000 and work is slow, its tough to write that check. Or you do a $25,000.00 job and the man says I dont have the money to pay you, but the local material center, wants their $15,000.00
This happened to a friend of mine, a employee got killed on the job and now everyone is sueing his company and all his insurance has been canceled, we are doing a job for him now because he doesnt have WC & GL ins. Im not writting this to get a crappy reply, you asked for advice
"its not all about being the boss"
I wont bore you with my opinion anymore. Base what you are trying to do on
1. money in the bank
2. family situation (married, kids, health ins.) forgot the family dogs
3. credit rating
4. equipment needed to buy
5. workers Comp (In my area this has to be paid, no payments) $3000.00
6. General Liability Ins (mine is $3500 a year)
7. Transportation
Im not sure what you need to do your work, but what have you got to purchase? You need a good accountant to keep you out of trouble. You will need the above insurances, to work on most jobs. Most of my jobs, you have to pay up front for materials and then wait to get paid, can you handle this?
Go get some credit with whomever you will be working with, (concrete company, materail supplier) before you quit your job.
Get your company titled as a LLC or INC, to protect your home, etc
Get brochures and Bus cards made and pass them out, if you can find a address, mail it to them, this is hard work, if you do it right.
Do you know how to price a job? lot of cut throating now, during this slow time.
Do you get along with people, if not forget it.
OK Im finished, these questions do not need an answer for me, it was for you to ask yourself honestly. I own and run a land clearing and mulching business, its good to have your own business when its going good, but when the accountant says you owe the IRS $10,000 and work is slow, its tough to write that check. Or you do a $25,000.00 job and the man says I dont have the money to pay you, but the local material center, wants their $15,000.00
This happened to a friend of mine, a employee got killed on the job and now everyone is sueing his company and all his insurance has been canceled, we are doing a job for him now because he doesnt have WC & GL ins. Im not writting this to get a crappy reply, you asked for advice
"its not all about being the boss"
jmac
Senior Member
Willis, it is hard to be the boss, absolutely. I have been self employed since 1989 and have owned three completely different companies that I have started from scratch. I owned a retail pet store for 18 years sold it this year, a manufacturers representative agency for 15 years and a excavating company for 5 years so lots of up's and downs. Thank god my wife has been supportive in the bad times because I could of just gave up 100's of times and went to go work for some one else. The excavating is the most fun of any thing that I have done so far. Not easy, but can be very fun just the same. The biggest point here is your wife has to be on the team and if it was easy no one would have any employees because they would all have their own company. But, give me the same money I make now and a job working for some else and not myself tomorrow and I would turn it down. This is just me, at this point in my life I don't think I would make a very good employee, being in complete control of your destiny is still the American dream. :usa
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Willis Bushogin
Senior Member
starting a business
Liked I said before, he asked for advice and this is my 2 cents worth
The banks, cant even stay in business
I thought he was asking about starting a new business, its great having your own business on the positive side, you set yours own hours (mine are usually 6am-7-8pm 7 days a weeks)I enjoy working these hours and my wife is part of the business. meeting customers and trying to get their business, I like that. Ive already listed the negative issues. I still say, as others has said, its not the time to start a new business, unless you have plenty of money, plenty of backing, possible jobs lined up.
Liked I said before, he asked for advice and this is my 2 cents worth
The banks, cant even stay in business
dpull
Well-Known Member
On your own
If I had a good job and they were treating me good I think I would stay put for awhile. I've been on my own for 28 years now and have enjoyed it but I think we are going to see tough times ahead for the next few years. Here in central Ohio things look pretty bleak and I have friends who are in all phases in the construction industry. Best thing I can tell you is to remember its not all profit and don't be afraid to ask for your material money up front. I heard a Quote a number of years ago; Tis better to try and fail as a young man than to grow old and wonder what if? Some times the Grass looks greener on the other side is a thought one still has to ponder. Not trying to talk you out of it BUT I would think about for awhile.
Good Luck,
dpull
If I had a good job and they were treating me good I think I would stay put for awhile. I've been on my own for 28 years now and have enjoyed it but I think we are going to see tough times ahead for the next few years. Here in central Ohio things look pretty bleak and I have friends who are in all phases in the construction industry. Best thing I can tell you is to remember its not all profit and don't be afraid to ask for your material money up front. I heard a Quote a number of years ago; Tis better to try and fail as a young man than to grow old and wonder what if? Some times the Grass looks greener on the other side is a thought one still has to ponder. Not trying to talk you out of it BUT I would think about for awhile.
Good Luck,
dpull