Mechanical Hub welcomes you to the very first installment of “They Said It” where we talk to contractors and get their viewpoints regarding the industry. This inaugural piece features some of the most innovative, progressive and successful contractors in the country as they weigh in on going into business on their own.
Question: What advice would you give to those thinking about starting their own company?
Stay in touch with customers. Communication is key! At first you may field calls yourself throughout the day. Eventually, you may have someone answer the phone or a reputable answering service.
Schedule … try not to overbook. Doing a job in our minds is way faster then actually doing the job. I can remember not accounting for things like travel time … supply house lines … and eating. Don’t forget to eat!
Public relations. Always be polite, and professional. Remember, the customer has a schedule also. It never hurts to give small tidbits of information as you go about the task of diagnosing. Do not be afraid to let someone know that you need a few minutes of uninterrupted thought. It may help to have an electronic device that clicks like a gas sniffer. Sometimes and audible prop will allow you the distance to collect your thoughts.
Follow up! Get over the fear of following up with quotes, even if a week or so goes by. Hey, it’s worth the call and you may be surprised as to why they have not gotten back to you regarding your estimate.
Be open-minded and willing to listen and learn from everyone you encounter from customers, vendors and other contractors.
Take the time to educate yourself in business practices. The psychology of the human brain probably helped me the most dealing with employees and customers. Engage in your community (volunteer), developing long-lasting relationships with everyone. Educate your team and yourself on all the newest products and practices.
Find or develop the smartest, hard working people when hiring.
Start early. I started my company at age 34 but wish I had done so five years earlier.
Make sure you are capitalized. My company was successful from the start but earnings were re-invested back into the company for growth. I was prepared financially to not take a paycheck for a minimum of one year to finance the growth of my company. Do not rely on banks, as it is unlikely they will write a note for a new small business. My bank said to come back in two years. My response: “I won’t need you in two years.”
Be persistent. Don’t quit. Show up on time. It seems like an oversimplification but I truly believe in this.
John Abularrage, Advanced Radiant Design, Inc.—Stone Ridge, N.Y.
John has been running his business since 1981. They custom-design fully integrated radiant and alternate-energy heating systems that deliver complete comfort, the highest efficiency and greatest reliability.
Running a business is a completely different skill set than the craftsmanship.
The most important thing in running a business is understanding people—employees, clients, yourself.
A long-term perspective of time is essential. It doesn’t matter where you are, but rather where you’re going. See the trends as they are happening.
Andy Mickelson, Mickelson Plumbing & Heating—Missoula, Mont.
Since 2011, Andy has built a solid foundation for his business through hard work and perseverance. His performance on high-profile jobs have placed him at the top for customers seeking a knowledgeable contractor in the plumbing, hydronics and HVAC field.
To steal a phrase, entrepreneurial seizure is a common term used when thinking of the idea of starting your company. Most that do it think it’s a really good idea, but one needs to do his/her homework first. Go to the local SBA (Small Business Administration) chapters or visit the local community chamber of commerce to do some researching, and for a reality check. I took 8-9 months of planning before I left my previous job to start Mickelson Plumbing & Heating. Often times, when working for someone, one thinks they might have an idea of what it’s all about, but really has zero knowledge of running his/her own business.
Don’t lie to yourself; take the “I think we did well on that job” to “I know we did great.” This will give yourself a better understanding of what you might need to do on the next job. If you assume that you made money on the job and you didn’t, you will fall into the same mistake. We’ve heard it before, “performing the same thing over and over again expecting different outcomes is the definition of insanity.”
Set attainable goals, and do it often; once you reach that goal, blow past it. But don’t set a goal that is unattainable.
Jason Ridgeway, Ridgeway Home Services—West Chicago, Ill.
Ridgeway specializes in forced-air HVAC, radiant, geothermal and snowmelt systems and the latest HVAC technologies that provide comfort to his customers. He has been servicing the Chicagoland area since 2007.
Don’t do it. It’s not worth it unless your one of the extremely lucky few who can handle and run a profitable business. It’s like a mirage in the desert; it looks like it will be an easy life where you sit at your desk or at home just counting money, telling others what to do. In reality, a service business can be life consuming, full of pitfalls—heartache, late nights and early mornings, with no sick days.
You wear all the hats, including full-time babysitter, accountant, businessman, front person, sales person and complaint box. Oh yeah, every now and then you get to count the money, but immediately after you get to dispense it, watch tens of thousands and some times hundreds of thousands of dollars instantly vaporize out the door—leaving you again under the gun to chase the next dollar.
But you get to make your own schedule and you don’t have someone telling you what to do. Well, except for the customer who expects you to answer the phone at any given time of day—one who demands that you come to their place for Christmas but not to eat. They want you to come see what that noise is they hear every now and then. You could send your guys and ruin their holiday or you could go and make everyone happy but your family.
While on vacation every one in the world seems to have an issue and they all have is your number. Do you toss your phone in the ocean or do you answer it? Will your business be there when you get back? Sorry honey, I have to cut this short by a day or two, there’s an issue I have to attend to. Have fun running that business on fumes while you fight to get pennies on the dollar.
Being the best service tech installer doesn’t by any means mean you will be a good businessperson. In fact, I think it’s the number one cause of failure. You will care too much. You will go the extra mile too often. You will say yes when it should be no. You will give too much of yourself for something that gives the slightest of chances of making it profitable.
That’s my 10 years worth of running a business advice. Don’t do it. Find a place that pays you what your worth; a place where someone else has to make the decisions; somewhere that when you’re done with work you actually get to go home and not have to think about work; a place that lets you have those vacation days. Find a place with good benefits and work there as long as you can.
Don’t get me wrong, there’s good to it but you have to step in piles upon piles of shit to get to it.
However, if you’re a strong headed go-getter entrepreneur and the greatest service/installer known to HVAC, and your going to be the guy who makes it:
Never, ever, ever, ever do new construction. No matter how profitable or big the number is. You will lose yourself and your company; it’s just a matter of time. There is no 40-year-old new construction company I know of.
Employees are not your friends. No matter how good you are to them, it’s business first and last.
Never count the money until after the jobs done and the bills are paid. Bills are not just materials and labor. This is a close runner-up for number one.