Business, how it works.?

I've noticed some wanting to start a business in WCO. My advice is to help, but also to learn if I am missing anything. Granted, I don't like dept, or profit margins on dept, so this is from starting with money saved. Stay organized, I use quick books, but I've seen others who use excel. Perhaps the best way to start this thread is with an example. Keep in mind there are "many ways to skin a cat" . Looking at a basic cost benefit ratio.


Costs
Business license, permits, and insurance / year $4,000 / number of jobs
Traps and supplies for pigeons. $1000 / number of pigeon jobs
Advertising 1 yr. $700 / number of jobs

A phone call for a "simple" pigeon job. $1.50
Contacting manager to sign contract, time and material. $20.00
Driving to inspect and set up. $.55/mile $35.00
Driving to inspect progress till finished etc... $35.00 x 4. $140.00
Cashing/ depositing check time and miles. $10
Taxes 30% gross profit. $150


Benefits

New customer. $????
Advertising while driving, at place. $???

Billable time 6 hrs @ $75. $450
Other benefits?



Wow! Perhaps I'm not charging enough!?

As a group, many tend to underestimate their worth. Also, plan on something going wrong. What if you break something and have to pay out your insurance deductible?

Although both NV and DaveK are right on with their posts, they probably would have scared me into never starting my business. I'm

reasonably sure that I've mentioned this before, but for you new guys, it certainly bears repeating. You get out of a business

exactly what you put into it. This was made perfectly clear to me by the wife of a noted cardiologist. Apparently, her husband was

going to be late again and they probably had reservations. ( I've been there, as have most of us, I'm sure ) I arrived to take care

of their raccoon/squirrel problem at just the wrong time. Mrs. Cardiologist yelled the following statement at me and it must have

really sunk in, for me to remember it! What she said was: "Everybody yells about all the money that doctors make, but let me tell

you something; if the people that work at McDonalds, put in as many hours in a week as my husband does, they would be able to

afford a home in the suburbs too!" While their home may not have been as huge as hers, she made a point I will never forget: If you

love what you do, success is sure to follow.

Then there are jobs with essentially the same costs and 20 hrs of billable time. $75 x 20 = $1500. Not to bad for 2 days of work!

Maybe I'm charging to much. However, if the customer is happy and was a good one, then these are the size jobs to do.

I agree with both Dave and Paul.

Now it comes down to choosing your customers, if you can. Who have the lowest cost benefit ratio? Is there enough of them to keep you busy? And do you like to do that type of WCO?

It is scary. The successful ones won't let anyone talk them out of it.

the question that I have is, Where you gonna find a pigeon job call for $1.50???

It's probably more like $50, wouldn't you guess?

If your telephone company charges you more than a buck and a half for a call, it's time to find a new carrier.

Um...I was thinking of the cost to have a possible lead call you....then actually get the person as a customer. But, hey, if you guys are worried about the cost of a phone call...then I plead mercy.

a good bird lead these days will cost ya pretty good, DaveK, your probably close, give a little or take a little..
we could turn this post into a way to figure lead prices, we should let it run it course without me hi-jacking it with realistic numbers..Much more to figure than what the original poster stated....but that a decent start...

Great points from the guys above! A perfect Segway (sp). Let's touch on it a little more.

So now that you, the new guy, has prices figured out enough that you get enough work and make enough profit, that you are sustainable. You aren't to worried about the $1000.00 phone costs per year ($50 x 12 + $400 for the new phone you had to buy because on the last upside down pigeon job you did your phone somehow flew out of your buttoned pocket and landed in a bucket with 2 inches of water in it). Your $1500/ yr computer and quick books is also manageable. You no longer do upside down pigeon jobs. You figure you are getting to the point where you could maximize your profitability if you choose better jobs, because you only have so much time and after all are only one person. So what do you do???

You start to look for Lead calls as mentioned above. Your willing to invest some money to get better more profitable jobs.

I am willing to pay a finders fee. Maybe paying 5% of the gross to the finder is enough incentive, maybe less or more. That's $500 for a $10000 job. You also realize that your customers could help you here, get to know them a little! A friend of their friend might work over at the industrial complex and have a terrible starling problem and they need good help, you.

What other ways can you get the good jobs?

Everyone, feel free to chime in on this. Afterwards, we'll look into hiring part time help or a book keeper and the associated costs and benefits.