OK, I was going to post this in my other thread but didn’t want anyone to feel offended that I was directing it to them so hence the new thread.
So how “good” is good? I know we have never talked money here and I have been here since about 2000 when it was just a long list of threads with no folders but I am damn curious.
I hear some guys say “Things are great” and another like myself say they are “tanking” but there are no numbers as a means of measurement.
So I’ll be upfront and honest and say I made about $30k for all my trouble last year and I have to be honest, thats dismal. Sure, my dad a retiree would be ecstatic about that but I need alot more to live.
So, without trying to offend anyone, what measures as “good” to you?
I am reconsidering my situation as honestly, I can go make more working for someone else with no responsibility and far less hours but…..I want to make this work after all these years.
And please don’t feel like I’m trying to be nosy or pry into your personal finances…just trying to figure some things out. Heck, if you want just reply high or low to my number if you think thats “good” or not?
Mike
Replies
that has to be qualified with local cost of living.
and ... I guess yer talking $30K "after" taxes ...
a good accountant and all the right deductions can greatly affect the effectiveness of that $30K.
I'll give my ideas ... really can't give numbers ... 'cause like I said ... I have no idea how much really ends up in my pocket!
My case ... wife works. At the moment .. she's off work and collecting 40% of her salary because she's still on maternity leave ... so we now have 2 kids.
when ... we have the mortage paid, all the monthly bills paid in full ... out little bit of credit cards paid(we have a consolidation loan and all debt will be paid off in full in less than 2 yrs), truck and car payments paid ... and Jeep repairs paid in full as they come up ... a full fridge ... a decent case of beer ... money for a dinner out once a week ... an extra $50 to $100 in my wallet to go last minute fishing or camping for the weekend .... plus the funds for a small vacation across the state(runs about $750) ... and ... money for a real summer vacation ... ($2,500) .... on top of the kids daycare bill at $300 month ....
we're doing "good".
sometimes ... we're not. Sometimes ... paying the mortgage (small, at $400/month) and the daycare are the priorities. Plus what ever debt we can "manage" ...
usually ... it's the other case ... good.
and as the good times ... come more often ... and we can actually pay off that debt AND get away ... things get better.
recently had a run of good times ... and a small hit of bad. But we're heading back into the good .... self employeed hick-ups will happen.
Someday we'll even have money set aside to ride thru the bad times ...
yeah ... right! Then I'd get lazy!
Numbers can always be played with .. fuzzy math.
U gotta look at what it buys you.
some locations are cheaper than others too.
priorities too ...
we don't send our kid to the cheapest daycare we could find ... aside from private schools ... it's one of the most expensive around ... but ... we decided years ago ... if we can't afford what we thot was the best ... ?
so we do.
and luckily we have arranged family care for the baby till he's out and she goes in ... 'cause it'd kill us to have both in there ... which ... we'd do if we had to ... or if it was the best for them.
If I was a single guy pulling in the same ... I'd be rich!
then again ... I know guys who make "the same" ... but send 5 and 6 kids to private school ... and they're doing as good or better.
U gotta decide for yourself "how much is enough" ...
Jeff
btw ... I want more!
Buck Construction
Artistry In Carpentry
Pittsburgh Pa
Mike
Thats a tough one and as Buck pointed out, location makes a big diff.
I make a higher wage then the one you mentioned, I'm employed and know that thats the way I want it. I do not have the desire to be self employeed or a business owner.
I dont know what your 30K does for you but more importantly is it worth it to you to do what you do for that amount?
I read your other thread and I feel for ya but you have to make some tough decissions. Can you go out and find a job right now that would pay you what you need? Can you do it mentally, by that I mean are you going to be able to handle it or are you going to want to be back working for yourself?
I worked for a guy down in Austin TX, a very bad business man. He paid me well and I know that he wasnt making anywhere close to what he was paying me and I didnt have his headaches. He could not have switched places with me, he had to be a boss.That must have been worth it to him but in the mean time his family was doing without. I dont know if he's still in business, I doubt it,but it will be hard for him to go to work for someone else.
You have to make some decisions that may mean that you do something that you dont want to but are actually better for you and your family. There is no shame in going to work for someone else, its not like you failed, you just changed directions.
Wish I had some devine wisdom to pass along but I dont.
Good luck with whatever you decide.
Doug
U mighta been here coupla 5-6 years back ... Corey is now 5 and Cath was prego with him ... I decided to go from self employ to employee ... for a steady pay check with the first kid.
It was something I always planned on ... grew up remodeling with my Dad ... 'cept Dad always had a first full time job ... remodeling was his second full time job.
went to trade school .. with plans to work for someone ... but Dad's old customers kept calling. Real basic work ... but constant.
So ... decided to make the change ... decided that I thot I could do top notch finish work .. just had to proved it to the world. So I found a design/build place that built top notch stuff. And jumped in feet first.
Best decision I ever made. Soon after ... realized I could do it ... but my small time stuff was no where near what I had imagined. It's one thing to alter a cab that cost $100 .. whole nother thing to alter a cab that runs $1,000! Hang a $40 door vs $4,000!
same skills ... 'cept whole lot less room for error.
I grew emensely from that experience ... never could have grown that much working on my own. Took everything from there and applied it when I went back to working for myself.
Making the switch isn't always a bad thing.
I have a buddy here ... he'll actually be feeding me some work shortly ... and I keep trying to tell him .. I think he'd be better off giving up his fairly successful solo business and working a while for a midsized highend remodeling company. He don't believe me ... but he's young.
He'll believe me in 10 yrs.
Jeff Buck Construction
Artistry In Carpentry
Pittsburgh Pa
It's never simple to describe who makes what. But I have no shame (nor money for that matter) so I will give it a shot. I made 16,400 for 06. Down from 05 which was a solid and stellar 18,200. Except for the part time secretary no one make less than me. But as the other have pointed out local economics, your economics and your structure make a big difference.
My business pays for all my work clothing, a new truck, most of my fuel etc. I have little personal overhead and I want to build my business which takes money to grow. I also have a few other small business interests that help along the way. So, other that a little travel and some good meals I pass on too many luxeries these days. I hope to build a business that my son will be able to push bigger in the future. He seems interested so we will see. I always have known and accepted the fact that working for someone else would be easier and more personally profitable. Just a choice to give that up for a long haul challenge. DanT
You need to go read Mark up in the business section of the chat. Haven't read you other thread yet and I have to agree somewhat with what others have said here.
I don't know if you are an employee or business owner, but sounds real low either way unless you are just starting out. Might just be the local economy.
I had about 70 guys framing a year ago and the average pay was was probably what you are making, meaning laborers at 12 and leads any where from 20 to 35 an hour. Now consider, I almost went bankrupt.
Can't blame the wages though, just bit off too much, didn't really know how to run that size of co., etc.
I'm in the process of really learning what it takes to run a co. well and was stoked to run across that aforementioned chat, very informative. Even as an employee you can take that method and apply it to your personal finances...basically are you making enough to cover your costs and make a profit.
If not, you have to make a choice. Most people undervalue thier time. Part of getting rid of 90% of my employees was I didn't feel pressured to take work that didn't pay well just to keep my guys busy. Basically, if people won't pay the price that I need to make a good living I don't take the job. Iv'e found that there are a lot of people willing to pay good to gett a good job done.
How many hours did you work to make the 30?
“The richest genius, like the most fertile soil, when uncultivated, shoots up into the rankest weeds..†– Hume
J,
Too many. Probably about 50-60 per week.
Are you happy?<!----><!----><!---->
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Yes?<!----><!---->
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Than I say it’s good!<!----><!---->
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I don’t make the high “$/year†either, but I am happy. Two new vehicles, nice home, and able to pay the bills. <!----><!---->
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When I was a kid, my fathered worked for a large corporation. He worked for them, got promoted, got transferred out of state, and got let go after 18 years and the most successfully run warehouse in the country. Because of the transfer I did get to know/work with my grandfather who, in my eyes was the best carpenter in the world, he could do anything!<!----><!---->
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My business is for my children. Yes, I spend too much time with it, but I can take my son with me if I want. I can make it to their schools for things without having to answer to anyone but me and my customer. I can… Also I can… And my children will get to know their grandparents.<!----><!---->
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It also allows for me to control MY future. If I need work, I find it.<!----><!---->
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Headaches, yes. <!----><!---->
Worth it, YES!<!----><!---->
Edited 3/3/2007 9:42 am ET by FRB
I think we all have to remember business is cylical and being a business owner or selfemployed you are going to be the first to be concious of down turns.
I will use as an example midwestern farmers. They do what they do because they love doing it.
Some years are exceptionally good so they buy new machinery-mostly from current earnings. Some years are average so they hold off on buying, but still take vacations. Other years are really bad and they scrape buy on DW's intown income. But in the end they learn to average it out.
The ones who get in trouble are those who perpetuate their spending ways and life style aquired in the best years to the other years then can't sustain the spending.
You should really look at how your earnings after tax in an average year suport your desired life style. I that doesn't match up then its time to relocate or rejob. If they do look acceptable tighten that old belt & perhaps join the "big box" staff part time for a year or so until things turn around.
Good Luck!
Depends on how you do things.
Are you incorporated? I am and I pay alot of expenses before taxes.
I think I paid myself about 25k last year but the corp brought in about 42k. See what I mean. If it were up to me I would "make" about 6 grand a year and expense everything else to the corp.
You're taxed on profit after expenses, its one of the benefits of running your own business.
Mike,
"Good" is very subjective as I suspect you already know.
When I was living in Tampa and framing, I was making maybe $8 or $9 an hour and that was good money back then (mid 80's).
When I moved north, my pay more than doubled, but I wasn't doing any better. I just had bigger bills.
One of my tax years is all jacked up because one shop I did some work for sent out hand printed 1099's and while I only did $1039 worth of work for them, the IRS has it listed as $10,039.
In fixing this, I had a chance to dig out about eight years worth of tax returns.
I was an LLC for a while and then a Sole Proprietor.
Best year I paid myself about $60K
Worst about $30K
The first year I was in business I also had a job and made about $45K there and about $40K with the business.
I was surprised by those numbers because in my memory it seems like I made way more on my best year and way less on my worst. But there it is.
"Good" to me is having a decent safe car for the family. A clean respectable truck to get back and forth to work in. A decent house in a clean safe neighborhood with good schools. A few bucks in the bank so that a blown water heater isn't an emergency. And enough in my pocket to be able to go get a pizza and a movie so I can sit around with my kids on a friday night.
I am not doing "Good" now. My wife is a nurse and makes about $70K a year. My base salary is about $45K a year and I also bring home about $2K a month in untaxed allotments. i just bought a new house that cost $300K. it's in a GREAT neighborhood with some of the best schools in the state. I've got a 2003 Explorer and a 2006 Chevy Silverado. A few bones in the bank.
How could it not be great? I got in a rut like you are in now. Not because it was slow. My daughter was sick and things got bad. I started looking around for something to grab on to. when I couldn't keep health insurance, I grabbeed on. good thing too. She went in the Hospital a week after I reported in. almost $20K for a week.
So now, We make way more than the average. we have a much nicer than average almost everything. But:
a. I miss my tolls and the work. On a day like yesterday I can't help but look at every job I pass and think how lucky those guys are.
b. My time is no longer my own. I'm just killing time right now before I leave for a WFX that will have me gone for ten days. Three weeks after that, I'm gone for two weeks to a school. The day after my son graduates highschool? Gone for 18 days. Three weeks in August too. I've probably worked six of the last eight weekends. And to top it off, it looks like we'll be leaving for a year in the fall.
I get thirty days leave a year. Right now I'm sitting on 50.
c. My family time just keeps dwindling.
d. Money and Happiness aren't always the same thing. I used to say that anyone who says you can't buy happiness just hasn't found the happiness store yet.
Last night my wife and I were talking about what we would give to have our old life back. me running a framing crew, her working at the Animal hospital. A simple house, simple needs, and time for life.
I know how you feel right now, because I've been there. And, you're probably gonna have to take a job to make ends meet for a while. But before you pack it in, thinnk long and hard about it. If you don't think you can walk away without any regrets, make sure you don't get yourself in a situation where your stuck and can't come back.
I've got two standing job offers. Both around $50K a year. I would love to take either one. I can't take either. One, I couldn't live on that anymore. Two, uncle Sam aint lettin go anytime soon.
A lot to consider. Don't make let your mood right now make your decision.
Good is...
Paying the bills (even if they're late)
Food in the fridge.
Coming home for lunch to see my five year old get off the school bus.
Having my wife be able to stay home and raise our three kids instead of some stranger.
Taking off that morning so we could_______________(insert your own)
Taking my four year old (in her overalls and workboots) on that estimate last week.
Having someone compliment something that has my name on it.
That feeling you get when you take that last look at that big job you finally finished.
Listen, I don't know you and you don't know me but I've been there and I've learned its not all about the dollar.
Lifes to short and to sweet. Enjoy the things self-employment gives you besides the paycheck and that 30k will feel like a million.
Lots of luck...John
very well said!
Have a great day
Cliffy
Great post John! I can relate to all the things you mentioned, sometimes I need a little reminder of how great self-employment can be.
Mike
mike... every year now i get a statement from the Social Security Admin..
i tells me how much i reported for ME from when i started reporting.... now..believe it or not... i never under-reported my income.. so this is an accurate history of my working career
it starts in 1960 when i was working after school ( in high school)
and it's pretty funny like..
1966.. my first FULL year in the army. most of the time as an E-5..
i made $2526... ( hey Robert ... how you like that number ? )
my last full year in the army , 1968 ( O-2).. i made $5889
the next year i went back to school and made $2711.. i didn't stay in school long .. started making big bucks in Marine Construction and then working as a foreman on a remodeling crew... got all the way up to $10,556 by 1975
then i went into business for myself.. as a sole-proprioter... started out making $8000...... next year i made $6000.... then $5000...
and finally.. the year our daughter was born, 1979 .. i finally got my first goose egg..
i made $0 dollars...
and my wife made less also.. even though we were living off her paycheck
up and down.. up and down.... best year i had was 81 ( $20,321)
then another goose egg in '86
and another goose egg in '91
finally .. in '99 , after making $8,700 the year before.. i decided i had to either run a business .. or go to work for someone else
i Incorporated my business and started charging more ( oh, yeah... another big change... since i was now an employee of a corporation, i got a paycheck every week , just like my guys )
there has been a steady improvement since '99 and changing the way we did business.. the last 6 years have all been profitable and we are actually paying all our bills
i don't regret being in business for myself.. matter of fact, i love it
but i wouldn' t want to go back to the days when we didn't charge enough for our work
my philosophy now is.. we will run this like a business and we'll get paid just like a REAL business, we won't buy jobs, we'll sell jobs
so... there were many years when we were bankrupt, but somehow we managed to keep going without declaring bankruptcy, and those were years when you could wipe out your debt in bankruptcy
nowadays... i don't know how some young people can stand the pressure.. .. the credit interest rates are usuorous.... and debts can't be wiped out...
will the future be like the past ?... probabaly... these cycles sure look familiar
what happens if we fall into a depression like the '30's ? ..... don't know.. i think our society is a lot more fragile than it was then.. there are a lot more interconnections than our grandparents had...
but we all come from the same stock.. they took their chances and stood up to the challenge... i guess we'll do the same
how "good " is good?...... it's pretty good !
chin up , non illigitmi carborundum
So many similarities.in 75 r 76, I was paid about eleven grand as an employee. Either side of that,there were a lot of years when I had about 4-5K.In '79, I incorporated and openned the wood stove store. Actually broke even the first year after paying myself some kin of salary. Cash flow was good, but then interest rates started spiking and the money I was borrowing to work with was eating me alive. In '81, the accountant and lawyer suggested bankruptcy.
No - I pay my dues and don't stick somebody else for my mistakes. That left me with goose eggs for the next 2-3 years rolling the losses forward. I think I was under by about 17K when I closed the doors.Went to work as a carp on condos in '81 which was like going on vacation....but it only lasted a few months 'till I got fired ( another story ,one of the proudest moments of my life) and I was self employed again.we got married about '86 in an area where every job was "sharpen your pencil some more"
so we moved here in '87 and went to work at wages again. Enough to get by, but less than I was making out there, only no overhead or late hours. About 18K/annumBut I could see the compay was about to fold up and jumped ship early to go back on my own in '91 and making about the same for a few years until I learned to operate a business and pay myself a salary. I incorporated again a few years ago and reap some added benefits from that.That is when things got "good"Lot of guys blame the area they are in, but I was still doing modestly in this area until I decided to change my ways and realize that I deserved a decent salary AND a profit from the business risk and this is a good area. The thing that increased my income to "good" was a change in my thinking and manaagement style, not the area I was in.
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!
good is knowing there's 6 months worth of contracts in your briefcase.
bad is wondering if you're working next week
as far as money goes, you will make what the local market allows. if its not good get the hell out of there
"good is knowing there's 6 months worth of contracts in your briefcase."not if you bid low to get those contracts!Good is knowing you are goping to make profit on top of wages on whatever contracts you have
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!
i used to have used car bussiness.there were good months and bad months.then tax time would come. deduct this ,deduct that ,oh yeah deduct dog food,my lab is the watch dog! anyway all them deductions sound great,then the tax man would say "well you have to pay taxes on 18,500." what the heck i could stay home and watch ophra and make 300.00 x 52= 15,600.a week in unemployment!
mentally it got to me,i knew i hadn't missed any meals but it was depressing. so i closed up,leased the building for 22,000. a year and went on. but now i can't deduct the dog food anymore.now i do rentals and to tell you the truth they are about the same way,lots of tax shelter but doesn't boost your ego much.
point of this is,if you made 30k after you deducted your car mileage,insurance, cell phone, tools,and even a couple bags of dog food or buy some beer for the crew on friday,what the heck. if you go to work somewhere else you still will have to insure the car,need a cell phone so the wife can call,and you'll still want that new scm saw. no write offs being a employee.just something to think about.
by the way your numbers are higher than mine!
hand me the chainsaw, i need to trim the casing just a hair.
I am an employee. I am a happy employee.
This month I will file my taxes showing I made 12,000 less than the previous year.
We gave up the big house, the high pressure job, the "nice" cars, and some other stuff.
Never been happier.
This work ain't about the money.
I have a good boss who cares.
Life is good.
Will be better if I can pull off Kentucky this summer like I want to.
JeremyThe bad news is you've done exactly the right things to be exactly where you are today. "IdahoDon 1/31/07"
No sure yet, taxes aren't in yet. This being my first full year in business, it has been a bloody expensive one. I have forked out a ton on new tools, new truck, new tranny, replace new truck with another new truck, new engine for new new truck etc. And I had to lay off my helper who happens to be a good friend of mine. Well, he usd to be a good fiend of mine. As you can see, this year's been an extra special kinda lucky.
That said, I'm still here and I've not lossed my house. Not bad for my first year. Admittedly, it's been a hell of a education and I've been scared sh##less the whole time but I figure I did allright.
Not too long ago, right at the height of my frustrations, someone asked how I was doing with the business, and without even thinking about it I said "FANTASTIC, I'm lovin' it!"
I know that didn't really answer your question. I will be happy to answer it when the numbers are in.
Dave
I said "FANTASTIC, I'm lovin' it!"you arre right, you didn't answer his Q - he wanted to know only when it is "Good" not when it's fantastic!;)really, I think you had one of the betteranswers here except that it was not quantified in numbers.It points out that we should not measure this in relative comparison to somebody else on a forum, but in relation to what we each want out of our business.
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!
For 20 some odd years I had worked for other people with the misguided belief that my hardwork would be rewarded with pay raise or opportunity. Neither happened. In fact the better I got the more threatened those around me became.
When I started my company I was working for a family owned lumber yard making $13.00/hr. (canadian) If anyone is wondering, that isn't good. I was a salesman on the lumber counter. My responsiblities included: general customer service, contractor sales, project estimating, special order purchasing, stock purchasing, stock packdown and merchandising, signage, Back-up truck driver, equipment rentals, etc.. I even mopped the floors. Our full time drivers had less driving experience than me and they made 15-16.00/hr.
I started working weekends with my company and worked full time at the lumber yard. I seemed to have success with this so last March I approached my employer and asked to go down to part time so I might persue my business more. I was told that they had no room for a partime employee on the lumber counter. (that was my reward for all my hardwork). Without hesitation (and without calling my wife, LOL) I politely informed them that I no longer had time for a full time position, and I gave my notice.
As difficult as it has been, I really do love it. I think that it has alot to do with my decisions being my own. Success or failure it will be completely my own doing. For the first time in my life I feel in control of my life, and not some one else. My only regret is that I hadn't figured that out sooner.
Dave
http://www.markupandprofit.com/Take a gander here and subscribe to his newsletter. Pay attention. You won't have to do everything to his thinking, but it will open your eyes abd help your business.
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!
Forgive my sceptisizm, but he seems like he selling what we already know. I'm sure there is a few tips there that we could use, but aren't we getting that from each other? He strikes me like some contractor who's figured out how to capitalize on the uncerntainty of other contractors.
Yes/No?
Dave
capitalize?The newsletter by email is free and has good advice.
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!
Piffin is correct. A lot of value in that book at any point in your business career. His total picture may not be exactly what you were looking for but is a definate path to a running well managed business with a design plan and numbers you can relate to. Capitalize? That is what we all do. I prey on people who don't think they can do their own bath or kitchen remodels, or faucet change. DanT
Doctor
If you ever get a chance, take one of his seminars. I've taken a couple at JLC seminars, and they were worth my effort.
I don't do all that Michael teaches, but what I have adapted works well. His seminars are no holds barred and no BS. He makes you take a long hard look at your business.
Greg in Connecticut
I'm going great, not just good, but I lost money the last few years making a transition from framing to whatever I end up doing. I didn't take a penny of salary last year and I haven't even covered my real expenses. Luckily, I'm not new in business or I'd be working for a paycheck somewhere....probably not here in MI although I know of many people that would hire me at some rate of pay...probably not enough to entice me out a cold winter's day though.
You have to be honest about how you're going to turn it around if 30k isn't enough. If you're making your bills and just spending too much time to earn that amount, look at your systems. No systems? Well that explains why you are spending so much time for so little return.
OTOH, if you are using good systems and the local market is dictating such a little return, you have to look at what you are marketing and to whom. That's what we've done. It's a painful process but necessary to see that your present form of business will not work and even more painful to change it in a bad economy.
In our case, I easily could have stayed in the same business, beat the bushes begging for work at steeply discounted prices and worked long hours at low pay, and payed my guys lower and made that 30k too. The question we asked ourselves before we continued down that path was "how will our business look next year? The year after that? The year after that?". We concluded that we would continue a downward spiral even under the best of circumstances. So, we committed to changing our business operation.
Of course, the bad thing about changing the business operation is that we might not be the best group for the new business...right? My skills were perfectly suited and honed for framing custom home, semi custom homes and the occastional stint in tract homes, but I'm not a good fit for residential remodeling. Thankfully, Frank is and I think he will turn the table this season. Already we have begun to get good referrals, something that is extremely important in a depressed construction market.
Myself, I have put all my eggs into moving out of the field and as such have invested a considerable amount of time and money (indirectly) into an entirely different phase of my career, one that will take me to my retirement. I'm paying my dues right now, the same way a young person would pay his dues by staying in college for four years, deferring his ability to earn income, and paying the professors to teach him. Will it be worth it? Only the future will tell. For me, I know it will pay off, just like my investment in a few thousand dollars of carpenters tools did back in the 70's and 80's.
Your question indicates that you are doing some soul searching regarding your last years business and that's probably a good thing. You have one advantage that I didn't have after my first few years in business...this site! I deparately needed something like this to guide me through. In many ways, I still do, but I'm also armed with something else....three decades of experience.
blue
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keep looking for customers who want to hire YOU.. all the rest are looking for commodities.. are you a commodity ?... if you get sucked into "free estimates" and "soliciting bids"... then you are a commodity... if your operation is set up to compete as a commodity, then have at it..... but be prepared to keep your margins low and your overhead high...."
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