Self employed opinions

[Azone]

Lots of great advice in the above posts. I'll add my own experiences. Did 26 years in the military and when most of my peers were taking on lucrative post-retirement contractor jobs in the same industry I decided to go another direction. With the help of my girlfriend we opened an assisted living facility in a rural community. Because of our exceptionally high standards we were successful and soon bought out or competitor and now we are getting ready to purchase two more. From zero to 82 beds in 10 years. From the 20k foot level that sounds great. Pull back the curtain and you see lots of 24 or 48 or even longer stretches of nonstop work covering for staff that because of some minor reason they were not able to come to work. I am regulated to have a certain staffing level at all times so when someone decides they are going to ghost their job we have to fill their shifts often with no notice. I'm often left wondering how I can work 26 years without missing a single day yet the folks I employ rarely make it two weeks before calling in for some reason or another. Every person is different and money can't buy integrity. If you plan on getting into an industry that employs people at or near the minimum wage you will have a unique set of challenges. Colorado's minimum wage increased approx. 50% over the last few years. Aside from writing bigger paychecks - nothing has changed. Job ghosting is still prevalent, collection notices for employees are prevalent, requests for pay advances are still prevalent. The industry doesn't support significant pay increases. My revenue sources are largely fixed so when some lawmakers see fit to increase minimum wage we can't simply pass the cost increase on but have to cut costs in other areas. As owners, having the soft skills to understand and deal with these issues is what has made us successful in our area. Not to mention I can always rely on my military pension and insurance. Our industry is the 2nd highest regulated industry in the state - we are subject to unannounced inspections every year. Those challenges pale in comparison to finding, hiring and retaining qualified staff. Consider the industry you are getting into and your labor pool. You might think you are the hardest worker around - you might find out it's true.

My wife worked in a care home briefly before her current job. It takes a special kind of person to actually give a damn about those that cant take care of themselves. There would be days she use to come home bawling because someone she had been helping passed. That is definitely a tough line of work.

 

[Akwoodchuck]

I wouldn't go back to being an employee for ANY amount of money.....

 

[Beendare]

Self Employed 40 years here...a contractor. I love my job. Now there are parts of it I don't like for sure....but I love what I do which is a different project every couple weeks/months.

I don't even look for work anymore....it finds me...so I can be selective. in the beginning you won't be so lucky....

Employees will be your number one pain in the ass.

If I make a mistake...I pay for it- the buck stops here. Warning; This does give you a bit of cynical view of the perpetual whining in society today....so many folks want STUFF...and they aren't willing to sacrifice or work for it.

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[String&stick]

As a banker I will advise you to. . . Find a good banker!

Find a community bank (not a national chain) and talk with a loan officer, discuss their parameters, develop a plan with them.

I work in agriculture lending and I have guys that don't know shit about their business other than growing crops, they are still successful because they partner with people in the other areas that know those areas.

Having a bank that has your back, and that you can count on when the chips are down can be huge. Just know their criteria so it's not a shock if they ask for extra collateral, or make recommendations.

I do a lot of work with people on the verge of failing, they typically don't like what I have to say when we first meet. . . Five years late they look back and know they would have failed I'd they hadn't made hard choices. If you have a good lender they will head off a lot of those hard decisions before you get there by telling you NO when something doesn't make financial sense!

 

[Azone]

Self Employed 40 years here...a contractor. I love my job. Now there are parts of it I don't like for sure....but I love what I do which is a different project every couple weeks/months.

I don't even look for work anymore....it finds me...so I can be selective. in the beginning you won't be so lucky....

Employees will be your number one pain in the ass.

If I make a mistake...I pay for it- the buck stops here. Warning; This does give you a bit of cynical view of the perpetual whining in society today....so many folks want STUFF...and they aren't willing to sacrifice or work for it.

_______

The employee part is what scares me. Some of the people I work with are some blue ribbon morons and screw ups. These are also the ones that were qualified, allegedly. My environment contains people that are anywhere from bachelor's degrees to convicted felons, you wanna talk about some interesting conversation topics when everyone gets together.

 

[Where's Bruce?]

Lots of great advice in the above posts. I'll add my own experiences. Did 26 years in the military and when most of my peers were taking on lucrative post-retirement contractor jobs in the same industry I decided to go another direction. With the help of my girlfriend we opened an assisted living facility in a rural community. Because of our exceptionally high standards we were successful and soon bought out or competitor and now we are getting ready to purchase two more. From zero to 82 beds in 10 years. From the 20k foot level that sounds great. Pull back the curtain and you see lots of 24 or 48 or even longer stretches of nonstop work covering for staff that because of some minor reason they were not able to come to work. I am regulated to have a certain staffing level at all times so when someone decides they are going to ghost their job we have to fill their shifts often with no notice. I'm often left wondering how I can work 26 years without missing a single day yet the folks I employ rarely make it two weeks before calling in for some reason or another. Every person is different and money can't buy integrity. If you plan on getting into an industry that employs people at or near the minimum wage you will have a unique set of challenges. Colorado's minimum wage increased approx. 50% over the last few years. Aside from writing bigger paychecks - nothing has changed. Job ghosting is still prevalent, collection notices for employees are prevalent, requests for pay advances are still prevalent. The industry doesn't support significant pay increases. My revenue sources are largely fixed so when some lawmakers see fit to increase minimum wage we can't simply pass the cost increase on but have to cut costs in other areas. As owners, having the soft skills to understand and deal with these issues is what has made us successful in our area. Not to mention I can always rely on my military pension and insurance. Our industry is the 2nd highest regulated industry in the state - we are subject to unannounced inspections every year. Those challenges pale in comparison to finding, hiring and retaining qualified staff. Consider the industry you are getting into and your labor pool. You might think you are the hardest worker around - you might find out it's true.

My daughter is an LVN working at such a facility now...dedicated to those with Alzheimer’s and related dementia. It's a big place, permanent residence for these folks. She is constantly pulling doubles to offset the flaky employees and work her way up the management food chain. Crazy how some people are today. Did I mention she's also working towards her RN?

 

[Salmon River Solutions]

I'm in this same boat right now too. Dad is retiring and I'm looking into purchasing his CNC mills and starting a machine shop, as opposed to what he was doing (tool and die). Big leap, with the investment into the machinery. Been researching and making contacts for a month now but haven't pulled the trigger yet. Finding work is obviously the challenge.

 

[Billy Goat]

The employee part is what scares me. Some of the people I work with are some blue ribbon morons and screw ups. These are also the ones that were qualified, allegedly. My environment contains people that are anywhere from bachelor's degrees to convicted felons, you wanna talk about some interesting conversation topics when everyone gets together.

Employees are something I can't handle. I chose not to deal with them, sacrificing the increased income I could receive with extra man hours. I do some things that are specialized and I don't have much competition for. I also buy tools that make it easier for one person to do something. That's a one time fixed cost. Where an employee is a constant. Employees can be great, but they can turn into a drain pretty quickly. That and I'm always hearing horror stories from others about what someone did.

 

[flyingbrass]

It's real simple. If you work for someone else you have to make them a living also! At least with your own business you call all the shots and you can work as much as you would like.

 

[Beendare]

The employee part is what scares me. Some of the people I work with are some blue ribbon morons and screw ups. .....

Well it wasn't really a fair comment the way I presented 1/2 of it;

Employees can make or break you. A good employee can improve your business...and thus your life if they do their job well. When you find a person like this, you have to covet them and treat them well. So its a big part off a business finding these good employees.

Good employees can be made through good training. You have to accept that some folks will take that training and move on. You can't be bitter about that...in fact you should be happy when folks are trying to improve their lot in life- its just part of the deal.

What makes it tough is a tight labor market like right now, its hard to find the right guys. I was at a local pub and the bus boy was working his tail off. We got into a discussion and he was only making $15/hr. I offered him $20/hr to start. He quickly became a great worker....picked up the training quickly. I bumped him up right away to $25/ after a month. Then another month later he tells me he got a union job grinding concrete floors in SF for $45 and hour- gone. It happens, good for him he was a good dude. You might have to go through a lot of guys to find the right one.

BEWARE; One thing you have to watch for now with this tight market is lawyers have guys out there looking to fleece you. I've had 2 buddies hire guys off ads that worked for a month....then took him to the labor board and sued him for not logging breaks and lunch time correctly. Cost him $120k after lawyers.

Guys starting a bar or restaurant should be aware of this too. One of my tenants is an architect that all he does is ADA access stuff. Lawyers train handicapped folks to go into these establishments with a tape measure and find non compliance with the 2,500 ADA retirements. Its $2,000 or $2,500 per offense here in CA...and its a cottage industry for slimy attorneys.

The current crop of politicians hate business owners and trash us any chance they get....even though it's us providing good jobs to help families and the economy.


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[Azone]

Well it wasn't really a fair comment the way I presented 1/2 of it;

Employees can make or break you. A good employee can improve your business...and thus your life if they do their job well. When you find a person like this, you have to covet them and treat them well. So its a big part off a business finding these good employees.

Good employees can be made through good training. You have to accept that some folks will take that training and move on. You can't be bitter about that...in fact you should be happy when folks are trying to improve their lot in life- its just part of the deal.

What makes it tough is a tight labor market like right now, its hard to find the right guys. I was at a local pub and the bus boy was working his tail off. We got into a discussion and he was only making $15/hr. I offered him $20/hr to start. He quickly became a great worker....picked up the training quickly. I bumped him up right away to $25/ after a month. Then another month later he tells me he got a union job grinding concrete floors in SF for $45 and hour- gone. It happens, good for him he was a good dude. You might have to go through a lot of guys to find the right one.

BEWARE; One thing you have to watch for now with this tight market is lawyers have guys out there looking to fleece you. I've had 2 buddies hire guys off ads that worked for a month....then took him to the labor board and sued him for not logging breaks and lunch time correctly. Cost him $120k after lawyers.

Guys starting a bar or restaurant should be aware of this too. One of my tenants is an architect that all he does is ADA access stuff. Lawyers train handicapped folks to go into these establishments with a tape measure and find non compliance with the 2,500 ADA retirements. Its $2,000 or $2,500 per offense here in CA...and its a cottage industry for slimy attorneys.

The current crop of politicians hate business owners and trash us any chance they get....even though it's us providing good jobs to help families and the economy.


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I would rather work 6.5 to 7 days a week in the beginning so as to take my time to find the right person for the job before hiring any random person for the reasons you mentioned. I know a few guys around here that have gone through similar situations with employees screwing them over.
Good for the bus boy that went from 15 per hour up to benefits and 45 per hour. I would never knock a guy for bettering themselves, my first boss turned into a prick when I gave my two weeks notice. I didn't feel bad whatsoever, what he was paying me per hour versus what he billed my labor out at....sheesh, drive a man insane. I remember being down at the bottom of the totem pole, working your way up is only natural if you want to get somewhere in life.

 

[Kilboars]

If you can ease into it by working part time for yourself it's much easier because you don't have a gun to your head HAVING to make money NOW.

 

[rtaylor]

I thought 13 years ago when I started my own business I'd be ditching the boss and be my own boss. Little did I realize that all of my customers were my new bosses and there was no one standing between me and them. Customers are sometimes a more difficult boss to deal with. Also, I had no idea I'd be looking for places to elk hunt where I'd have a cell connection so employees and customers could reach me.

 

[Baddog]

Eventually you’ll have to have employees if you want to make “more money” and you want time off. Don’t be afraid to hurt employees feelings and send them down the road. I figure I have to hire 5 guys to get one decent one. Just part of the deal. Some people have the ability to handle the stress and unkowns and others don’t. You won’t know until you try. If you hate it after a couple years you can probably get your old job back or another just like it.

 

[Lonald]

My take may not be what you're looking for so consider that it's just one man's opinion. I have been self employed most of my life. I am currently opening a 3rd business at age 60 while working far more hours than you do. A 75-90 hr week is my norm.

That being said, self employment is something a person must do. For most of us, we had no other choice. Our employers were idiots, we would never grow and become hugely successful as an "employee" and we are not interested in building a retirement income for others. We are self employed because it's the only way to be happy, reduce the risks and command our own destiny. If you need a pros & cons list to decide whether self employment is for you...it isn't. You just know. No doubts. You take the leap because you know you have to. You succeed for the same reason...you have to. That means doing WHATEVER IS NECESSARY to ensure your success. It's a life of sequential sacrifices, personal growth and a lot of talking to yourself in the mirror. Self employment is for leaders, not followers. All it takes is all you have.

This may or may not not help you but I promise you...it's the truth.

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My wife and I started a business together about 12 years ago. After about 2 years one of my friends said, I knew you guys would make it because once you both quit your jobs you didn’t have any other choice but to make it. Lol

 

[007hunter]

I would rather work 6.5 to 7 days a week in the beginning so as to take my time to find the right person for the job before hiring any random person for the reasons you mentioned. I know a few guys around here that have gone through similar situations with employees screwing them over.
Good for the bus boy that went from 15 per hour up to benefits and 45 per hour. I would never knock a guy for bettering themselves, my first boss turned into a prick when I gave my two weeks notice. I didn't feel bad whatsoever, what he was paying me per hour versus what he billed my labor out at....sheesh, drive a man insane. I remember being down at the bottom of the totem pole, working your way up is only natural if you want to get somewhere in life.

If you are serious about this endeavor I would highly suggest some business classes or find a mentor. A quickbooks class would be a good start. You gotta know your numbers. As has been said, you may know how to do the work but if you aren't making money on it, you will fail before you realize it. Do a google search on figuring out what you'll need to bill hourly. Indirect costs/direct costs. May even find a one/two day class near you. When you figure it out properly, you'll be very surprised how high that number is just to make a profit and cover all the costs associated with your business. I would guess you need to be 80-100$ per hour.

 

[Azone]

If you are serious about this endeavor I would highly suggest some business classes or find a mentor. A quickbooks class would be a good start. You gotta know your numbers. As has been said, you may know how to do the work but if you aren't making money on it, you will fail before you realize it. Do a google search on figuring out what you'll need to bill hourly. Indirect costs/direct costs. May even find a one/two day class near you. When you figure it out properly, you'll be very surprised how high that number is just to make a profit and cover all the costs associated with your business. I would guess you need to be 80-100$ per hour.

I was aiming to start at 80 per hour. Most guys in my area are 80 to 100, build up the client list and then slowly creep the hourly rate up over the next few months or year or two. I've done pretty well at just flat rating a few jobs to. Then there is always a mark up on material as well. My wife does the books for her father's business so she has a real good understanding of the paper side of it.
The small business classes would be great to do as well, if I could ever find the time though. One day I will probably do it, never hurts to learn something new.

 

[Alchemy]

Hire the best CPA
Find the best commercial lender in your field
Purchase quality equipment/tools
Find the best employees
Marketing
Insurance
Phones
Vehicles


Add all the items up then multiply it by 3, that’s what it will cost to run a legitimate business

LABOR+MATERIAL+OVERHEAD+PROFIT

Don’t undervalue yourself, charge what your worth. Don’t go cutting throats to get jobs, it’s not a sustainable business model

 

[Billy Goat]

I was aiming to start at 80 per hour. Most guys in my area are 80 to 100, build up the client list and then slowly creep the hourly rate up over the next few months or year or two. I've done pretty well at just flat rating a few jobs to. Then there is always a mark up on material as well. My wife does the books for her father's business so she has a real good understanding of the paper side of it.
The small business classes would be great to do as well, if I could ever find the time though. One day I will probably do it, never hurts to learn something new.

I use to do time and materials. Seemed fair to both parties. For the most part it is however when your humping because you have more to get done it's not helping that you are not making any more, infact if you had more time and worked at a more comfortable pace you would make more. Also if you are having an off day it ends up costing the client more.

Way I look at it is every job has a value. When you can do it faster or more efficiently it should be money in your pocket. Don't cut corners to save money, and be meticulous and most clients will realize you are doing them right. Also it's easier to tell someone a total price for a job rather than you are going to charge them however much that they will decide is too much money per hour.

Learn to bid your jobs and always figure for a little unexpected time you didn't see. Contract revisions/add-ons are a good way to makeup some ground also. If you're in there working and they want something else changed or added that wasn't part of it originally they aren't likely to bring someone else in.

 

[Big Dunc]

My wife started her own company almost three years ago. It has its ups and downs but definitely worth it. It was somewhat out of necessity after my son was born with special needs. Nobody would take care of him so she quit and started from home. I take care of the benefits from my job so no worry there. Making sure you plan for the off-season if your job has one is important. We have to put money aside for the two months or so in winter that work doesn't come in. But she is much happier and we can take trips when we want. I've been thinking about doing it myself lately.