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I am in the process of giving up my comfortable, well paying office job for a new career in residential construction. Ever since I was a little kid I wanted to be a carpenter. I somehow ended up going to college and getting a degree in finance, however I have always kept my hand in construction. In highschool I built decks and finished basements during the summer, in-between semesters while at college I re-sided and installed new window on my parents house. People in the neighborhood liked it so much I ended up doing several jobs each summer. I have also done several bathrooms and kitchen remodels. Most recently I purchased a condominium that need some work. I ended up gutted the place. I made my own kitchen cabinets and bathroom cabinets, as well as installed lots of ceramic, new windows, etc. I get a lot of complements on the work I did. At any rate, I do not like my current job and I love working with my hands and seeing things get built. While remodeling my condo, I realized that this is what I want to do for a living. The problem is I don’t know how to “jump in” to the business.
I have considered several different approaches. The first to get a job with a home builder as an assistant project manager, however, I do not have any experience nor do I have the educational background that most companies are looking for. One solution to this problem is to go to school and get a certificate or degree in construction management.
The second approach is to just go to work as a laborer with someone who works for the larger homebuilders in my area (New York meto area) and get to know the ins and outs of the business and hope that I can work my way in to a management position.
The third is to just go into business for my self. I am working on a business plan and the further I get into it the more overwhelming it gets. If I go into business for myself my intent is not to be a one man show for ever. I want to create a real business, employ people and offer the finest product and the bet customer service around. The problems I am having in developing a business plan are similar to many that have been posted here. I have no idea how to bid a job. I can figure materials with out much of a problem, and I know what labor rates are in my area, but figuring out how long someone will take to do the work is a whole other story. The other problem I am running into is that there seams to be a big shortage of labor in my area. If this is the case, how am I going to get sub-contractor to come to my job site. The one big plus I have going for me is that I am a financial analyst and I know how business operate and how business fail. If I do get this idea off the ground I think I will be able to do a good job running the business side of the business.
I would like to hear some advice based on three approaches I mentioned above. If people recommend approach number three, then I have a hundred more questions…but I will wait to see what everyone has to say first. Also, if anyone in the New York metro area is in need or willing to train a project manager, assistant project manager or what ever, please email me.
Thanks,
Jamie
Replies
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Jamie:
Congratulations on your new adventure!
Actually all three approaches work very well. Which one is for you depends on you. Sounds trite but it is true, especially since you already have at least some academic understanding of the business bones of a company.
In addition you have the advantage over most that you already have your own business and the referrals that come from it. So, ask yourself one question: Am I happier working for someone else, or myself? I suspect you want to work for yourself.
As for the Business Plan, go back in the business section of the archives. I know I have posted quite a bit on that over the past year or so. So, have others. Most of this has been in posts to other topics.
Basically don't let the format of a Business Plan get too complicated. It really is very simple. Use the format your bank wants. As a business owner you are going to need financing for working capital if nothing else. So, use their format.
Go over the posts in the current section. Several of us have posted on the elements of determining your costs. Once you know your costs your bid does itself. Once you have read them come back with specific questions. Many of us here will be glad to answer.
Just don't forget your accounting! That and remembering not to let anyone else write checks or sign purchase orders will save your bacon until you get big enough to install a fancy checks and balances system.
*Jamie,Looks like you got a leg up on most of us who just ended up in business rather than considered starting one. Your financial expertise will serve you very well.I think that finding a small independent builder such as you want to be and working for him/her for a while could be the best education. I learned from the mistakes I made in the field and the mistakes that others made. Sounds to me that you are without a doubt, the owner type. You don't want to be the employee, you want to be the employer. Salute.Stay close to this site, and don't be afraid to ask anybody anything.Good Luck,Ed.
*Hi Jamie,You need to jump in with both feet and hit the streets runnin'!What's your favorite kinda job?Start spreadin' the word around that your in business and want that work.Then, before you know it, you'll be a laborer and a project manager all at once. Good luck!
*To start with I would contract subs, and as you grow add on a few employees. the use of subs could reduce some of your overhead in insurance and taxes. as you well know.
*I agree that any of the three approaches will work but I vote for going to work for someone else, learning the basics of one of the trades and simply getting your hands dirty. I don't think that you will be doing this for long but it will give you a perspective that a white collar guy like you lacks and will be of tremendous use in dealing with mucks like the rest of us. Welcome to the club.
*JaimeDepending on your circumstances, you might see the thread in this section on Quoting a job just be seeing it. ( Sonny Lykos "How many of you have quoted a price by just looking at the project?" 8/31/01 8:55pm)I started a business 3 years ago, comming from a background in management consulting, and a career as a (really bad) carpenter about 5 life-times ago. Year one was a money loser (thanks to my wife's income), year 2 was a break even and now in year three I am running about a 12 to 15% net marginI did exactly what you state is your deisre. I am a real business (licensed, insured, taxed, etc) with 11 full time employees and about 10 to 25 subs depending on the day and season. I started out doing extremely small jobs ( I thought a $1000 job was heaven) and making sure that the customer was 100% happy, even if it cost me money. Then the customers started to ask for larger jobs. A $250 ceiling repaint turned into $35K worth of interior and exterior painting because the customer was happy. A $250 repair to some low voltage exterior lights turned into (after several other small jobs) a $120K bath remodel. You have to continually work and develop your connetctions. For the paint job, I called the guy who had painted my house a few years ago. He looked at the job, gave me a price, I marked it up and everyone was happy. FOr the bathroom remodel (My first job with blue prints) I asked the architect ( a friend from way back) who should be the plumber and the tile setter (walls, floor and ceiling set in 1" x 1/2" marble mosaic set in running bond, herring bone and other patterns). He wanted to work with me so was happy to help with the best subs he had worked with. Now I use those subs on other jobs, and they will bring us work as well. They key (from my perspective) is communication, developing your relationships and keeping the customer happy. It will take a few years but it is possible. This year I even took a one week vacation and did not have to call in. i may take another one at christmas.Jim
*Jim,Thanks for your message. Its very encouraging. My wife also has a good job with full medical. This will help greatly if things don't go as planned in the first few years. What part of the country do you work in. I am in the New York Metro area and I am a little worried that the economy may not hold out and now with this terrorist attack on the U.S. I am even more unsure what is in store for us over the next year or so.Thanks,Jamie
*JamieI am in Chicago. We work 99% in the city, northside. Lots of single family residential and high rise. The demographics in this area are very good. (as willie sutton said "that's where the money is"). One big plus in working for professional customers is your background which makes you look like a demogrpahic cohort.We have not seen much of a slow down yet this year. Who knows what the future will bring (particularly after tuesday) but that is part of the fun of running a business. Jim
*Jamie, See my repsonse to your post in the main discussion board. Of course, I'm the only "reluctantwatch outrun Jamie run" response so far but hey, the business hasn't worked for me...What can I say?Mike
*Jaimie:Do you like working with your hands, or watching/ managing peopole who work with their hands?I would find the best at what it is you want to do(renos,cabinets etc)and try to work for them, doing anything. When they see that you are smart and want to learn, you will have the chance-not every day, but now and then they will show you something new.DON'T go into business yet. Make mistakes-lots of them-at the expense of your employer. Then apologize and work even harder.Even when you are doing something uninteresting you will be learning by watching someone else. Remember that doing something that you love as a hobby and doing it for a business are very different. Learn about running the business. Tons of guys are good carps, but the ones who make money and work all year are good businessmen too.Don't want to discourage you, just want you to benefit from my experience.Good LuckAndy
*Jamie, ironically, if you like working with your hands, then running a business will not satisfy you. If you are running the business successfully, you won't have time to work with your hands.blue
*B.E.D.:You have pinpointed the great conundrum of being a tradesperson:It quickly becomes apparent that to make more than a decent (average?)salary as a tradesperson you have to run your own show, which naturally takes you away from what got you into this line of work in the first place. How many of us got into this because we love estimating, writing up change orders, and collecting our hard-earned cash from late-paying customers?Andy
*Oh, it has it's moments.............................
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I am in the process of giving up my comfortable, well paying office job for a new career in residential construction. Ever since I was a little kid I wanted to be a carpenter. I somehow ended up going to college and getting a degree in finance, however I have always kept my hand in construction. In highschool I built decks and finished basements during the summer, in-between semesters while at college I re-sided and installed new window on my parents house. People in the neighborhood liked it so much I ended up doing several jobs each summer. I have also done several bathrooms and kitchen remodels. Most recently I purchased a condominium that need some work. I ended up gutted the place. I made my own kitchen cabinets and bathroom cabinets, as well as installed lots of ceramic, new windows, etc. I get a lot of complements on the work I did. At any rate, I do not like my current job and I love working with my hands and seeing things get built. While remodeling my condo, I realized that this is what I want to do for a living. The problem is I don’t know how to “jump in” to the business.
I have considered several different approaches. The first to get a job with a home builder as an assistant project manager, however, I do not have any experience nor do I have the educational background that most companies are looking for. One solution to this problem is to go to school and get a certificate or degree in construction management.
The second approach is to just go to work as a laborer with someone who works for the larger homebuilders in my area (New York meto area) and get to know the ins and outs of the business and hope that I can work my way in to a management position.
The third is to just go into business for my self. I am working on a business plan and the further I get into it the more overwhelming it gets. If I go into business for myself my intent is not to be a one man show for ever. I want to create a real business, employ people and offer the finest product and the bet customer service around. The problems I am having in developing a business plan are similar to many that have been posted here. I have no idea how to bid a job. I can figure materials with out much of a problem, and I know what labor rates are in my area, but figuring out how long someone will take to do the work is a whole other story. The other problem I am running into is that there seams to be a big shortage of labor in my area. If this is the case, how am I going to get sub-contractor to come to my job site. The one big plus I have going for me is that I am a financial analyst and I know how business operate and how business fail. If I do get this idea off the ground I think I will be able to do a good job running the business side of the business.
I would like to hear some advice based on three approaches I mentioned above. If people recommend approach number three, then I have a hundred more questions...but I will wait to see what everyone has to say first. Also, if anyone in the New York metro area is in need or willing to train a project manager, assistant project manager or what ever, please email me.
Thanks,
Jamie