Calling small/medium business owners

[woods89]

I've been self employed for 10 years in the residential construction field. Some thoughts, worth what you are paying for them.

-Right now, there is a lot of demand in many service industries. I'd be cautious about buying an existing business and paying for intangibles, when a little time spent building relationships might result in plenty of work and get you off the ground with only costs for tangible.

-No matter what you are told, if you buy an existing business you will likely lose a certain percentage of both employees and customers just from the change.

-If you buy a business and don't know how to self perform the work, and then lose some key employees, you will be in a very tight spot, and you will damage your reputation in ways that may take years to repair.

-Capital helps, and be prepared to see it evaporate temporarily, hopefully not permanently.

-Your money will be made in knowing your costs very well.

I'm told that 99% of small businesses are gone within 10 years. If people knew what the first 10 years were like, there would probably be a lot less "entrepreneurs". That said, I'm a huge fan of being self employed. I can and do, however, spend a lot of time on-site with a toolbelt on.

 

[roadrunner]

Planning to acquire an established business with a good customer base already. We obviously look at BizBuySell, LoopNet, etc. but we are also sending out letters to potential businesses we are interested in.

Those are both good websites to be checking.

Instead of an SBA, look into a R.O.B.S. (Roll Over as Business Startup).

If you're both W2 employees and have any IRA or 401K money, it may be an option.

Stear clear of SBA's if you can.

 

[ohoopee]

Take your time and make sure you run all the numbers on the new endeavor. Keep
in mind you will be covering your own SE tax, medical and retirement contributions. It is tough
to beat a W2 job sometimes. Blue collar man/woman annual hours/pay is similar across the
board. Scaling up with employee's seems to give you a bigger piece of the pie. That comes
with its on headaches). People often focus on getting the start up funds and haven't done
the rest of the work. Good luck with your endeavors))

 

[2ski]

I should work on my leadership skills. I’m currently a professional firefighter so I have good decision making skills, work very hard contrary to public opinion. Although I obviously haven’t held a chiefs position being so young. So leadership is something to work on for sure. Thanks for the insight! How did you learn leadership and get started?

Be comfortable with being uncomfortable.

I'm honestly glad you replied to me. That, I assume, means something about it caught your eye. And that actually makes me feel more promising about your chances.

First I'll agree with people that said, you're a firefighter so you should keep your job and develop the business or your knowledge of operations. Let your wife work it while you're working the firefighter job. You don't necessarily need to know how to do it when you buy it but you better learn quick. Find the employee that can teach you and TREAT THEM LIKE GOLD.

Also as has been said, you have to put in enough time to have the respect of your employees. Because if you step away they have to be able to attest to all the blood sweat and tears you put in, to future employees. And then when you do check, do work when you show up. Let them see you're there to help. But make sure they realize it's not a "gotcha" moment. I.e. "I found something you didn't do".

Leadership. You asked about my leadership journey. Honestly I wish I would've had some different bosses for some periods of life. Some more like I am now. So first off find a good mentor. I asked you a question about top down leadership. That's not the way the world works anymore. People want to feel valued and heard. Not barked at. So find a mentor that promotes that. Not one that thinks leading is barking orders and expecting no questions asked follow through. The smartest thing anyone can ever say is to ask "why".

I've been told I was an quiet leader for a lot of my life but I honestly didn't see it until the right situations just fell into place. In work and in life. Certain things just started to make sense. Every assistant manager thinks managing is easy or they can do it better until they become the manager. Then they realize its not easy. But its rewarding AF. Learn from people that lead. Find people online that give out leadership wisdom. Twitter is a great place. I learned so much from a college football coach and the things he was constantly tweeting for his players. I've actually heard a journalist that covers that team say similar. The coach is now a SEC position coach so he's not tweeting the same things anymore. His press conferences were amazing. I was just sitting at home listening and I would've run through a brick wall for him.

There's so much on leadership that I could say but don't have the time. Show your employees you're willing to bleed for them and they'll bleed for you. I had employee tell me I was the best boss she's ever had. That's one of the greatest compliments I think I've ever been given. Care about people. Sure you'll get burned but you need people to trust you. Be vulnerable. Be willing to say "I don't know", "I'm sorry", and "Thank you". Emphasize wins of people and not their mistakes. Learn from mistakes. Get other people's ideas, make sure they know they were heard, and if you make a decision that was opposite of what their idea was, emphasize that they were heard. I heard this the other day and I like it. "Is it true? Is it kind? Does it need to be said?"

Two things you should look to. First is a podcast call the Initiative one leadership podcast. People pay alot of money to learn from Initiative One. NFL coaches and GMs know who they are. And if you're ever struggling with times of doubt, look up the Ted Talk "I am enough" on YouTube. The guy that started Initiative one is the gentleman giving the talk. The second is a group called Laughlin Associates. Specifically I think you could benefit from their "magnify your wealth" gatherings. You pay money. And make no mistake everyone there speaking is there to sell you on their product which is geared towards wealth management. But Aaron Scott Young cares deeply about entrepreneurs and their success. That's not a leadership suggestion. Just a business one. They don't touch on leadership. I think Aaron has or used to have a podcast. Another podcast that may or may not pertain to you is called Get Fundable. I learned about it through.

 

[307]

...meanwhile small business owners are wishing they had become firemen...

 

[menhaden_man]

Surely there’s a small biz advisor where you are. When I started a company in 2017 they answered a lot of questions and it was useful to book that free hour. We’ve been really successful but it wasn’t easy (and still isn’t). Good luck!

 

[EZduzIT]

I would do this. I started my tree business when I was full time with the city of denver. Slowly built up the business and never had to take a loan or have a marketing budget. After 5 years I left my city job and run my tree business full time.

This is awesome. Where is your tree business located?

 

[EZduzIT]

Come back for advice once you’re eyeing a business. I know some people that purchased roofing companies with no industry experience that thought they just needed to manage it. All failed miserably. Some businesses are little easier than that, but I still think if you’re buying a restaurant, you better know how to cook. I’m not suggesting you don’t go for it, because no risk, no reward. But I’d also suggest looking at the big picture. How far are you from retirement? What’s your exit strategy? Finding a competent buyer for a business is a difficult task as well. And every values their business far higher than it’s actually worth because only they know how much sweat equity they put into it, which doesn’t account for actual returns.

Good points. I’ll keep everyone updated on the journey. Good or bad.

 

[EZduzIT]

...meanwhile small business owners are wishing they had become firemen...

 

[EZduzIT]

I can't help on the sba loan, but i have been self employed for 20 years.

Own your decisions, especially when you make the wrong ones. And you will. Then learn from them.
Learn to function with out sleeping at night. It sucks, but it is part of it.
Sales does not equal profit, never has and never will.
You have to make a profit to stay afloat, detorating infrastructure eats up capital quickly.
Be willing to think things thru multiple steps down the road, not just a couple of steps.
Work the problem backwards, that way you know how to go forward.

Makes sure you are willing to lose everything you have. If you are not, you are not committed enough.
You have to go to work. in the short term the mice won't play, in the long term, the mice will play when the cat is away.
if you have employees, they will be your biggest attirbute and your worst nightmare.

This is great advice.

 

[Dsnow9]

This is awesome. Where is your tree business located?

I cover the whole metro area. Maloney tree care. Business Address is wash park area but I live up in Westminster.

 

[EZduzIT]

Take your time and make sure you run all the numbers on the new endeavor. Keep
in mind you will be covering your own SE tax, medical and retirement contributions. It is tough
to beat a W2 job sometimes. Blue collar man/woman annual hours/pay is similar across the
board. Scaling up with employee's seems to give you a bigger piece of the pie. That comes
with its on headaches). People often focus on getting the start up funds and haven't done
the rest of the work. Good luck with your endeavors))

Thank you! It does always seem hard to beat but I also always feel hungry for more! I like everyone’s comments regarding starting up something on the side while continuing my w2. We currently run a fly fishing business but we’re struggling to scale due to the lack of people out there with the knowledge of building a fly rod to hire.

 

[Dsnow9]

Thank you! It does always seem hard to beat but I also always feel hungry for more! I like everyone’s comments regarding starting up something on the side while continuing my w2. We currently run a fly fishing business but we’re struggling to scale due to the lack of people out there with the knowledge of building a fly rod to hire.

That’s going to be the biggest problem across the board. Employees are hard to find right now and good ones are near impossible. As some one else said, if you have good employees make sure they have no reason to leave.

 

[Silveroddo]

Are you sure you want a business that's dependent on employees in this labor market?
At the moment there seems to be a lot of opportunity out there for the guys that want to work. Most of my opportunities have come from Niche stuff that nobody else wants to do, or by leveraging unique knowledge and taking some risks.
A local cop found out how much his department was getting charged to set up the electronics on their squad cars. He figured out how to do it, charges a little less, and rigs up cars for a few local counties.
I've got a buddy who's worked for a home improvement business for years, his boss was trying to sell him the business for hundreds of thousands for quite awhile and he was considering it, actually wanted to do it, but was having difficulty securing funding. The stipulation was his boss got to stay on at $100k/year for "sales" and a company truck for a few years.
He's since gone out on his own for the cost of a pickup, some lettering, and a tool trailer and is keeping busy and making good money.
My wife doesn't have any issue making $50-60hr doing part time book keeping for several business's. Total investment of less than $3k for insurance and a good laptop.
Leverage your current skills or develop new ones that are in demand that can be leveraged for financial gain.
If your a fire fighter, can you start a training business, fire extinguisher inspections and service, flip/resell firefighting equipment, etc, etc.
Stick to stuff you know, or develop the knowledge as much as you can before you jump in.
Theres a hundred books and podcasts out there. The personal MBA is an audio book thats included with Audible, there's some real general stuff in it thats worth listening to.
There are a thousand guys out there with a bankroll and industry specific knowledge looking for the same things you're looking for, when money is as cheap as its been lately the stuff that you have an opportunity at is the stuff all the good old boys let pass by. Don't buy a dream, buy reality, be a skeptic, scrutinize. Once you sign on the dotted line its your baby, for better or for worse.
Not really what you were asking, but I have a hard time passing up an opportunity to give unsolicited advice.
Live simple and figure out how much you need to make to be comfortable (With insurance and everything)
$100k a year? The average 40 hour a year job is 2000 hours. $100k is $50/hr for 2000 hrs, or $100 for 1000 hrs, etc etc etc. Figure out the correlations and apply it to what you think you need out of a business and to develop the free time you're after.

 

[def90]

Planning to acquire an established business with a good customer base already. We obviously look at BizBuySell, LoopNet, etc. but we are also sending out letters to potential businesses we are interested in.

Make sure you do your due diligence and hire a good 3rd party CPA to go over the books to make sure everything is legit. If anything seems out of place at all walk away. People "selling" their businesses are usually doing it for a reason, if it really is a legit business that is doing well you are going to pay for it. In all seriousness you may be better off starting from scratch.

I've been a business owner for 18 years now, some times I wonder if I would have been better off overall if I had just stayed employed somewhere else. If you are not already well off ad doing this just for something different i order to make your business successful you will be devoting all of your waking hours to it and forget vacations, doing it as a couple will likely put a bit of strain on your marriage as well.

 

[roadrunner]

...meanwhile small business owners are wishing they had become firemen...

...until they try it and then wish to hell they hadn't done it...

 

[mtnbiker208]

The local community college probably offers classes, typically basic stuff, but it is stuff you need to know.
I have taken alot of them and continue to.

 

[Pikespeak]

I would not go this route without business experience. All loans you will be able to get are going to carry personal guarantees. Which means they will take EVERYTHING from you if you fail.

If you have the schedule to start something on the side I would go that route, build up something small so you can learn marketing, book keeping, licensing, contracts, making processes more efficient and on and on and on. Then make the big leap once you have a grounding knowing that the next level will be a whole other set of challenges.

Also, companies on BizBuySell are generally massively overpriced because everyone overvalues what they have and thinks they are on shark tank. Unless you have skills in how to educate them and bring them down to reality, you may get your ass handed to you.

 

[EZduzIT]

I would not go this route without business experience. All loans you will be able to get are going to carry personal guarantees. Which means they will take EVERYTHING from you if you fail.

If you have the schedule to start something on the side I would go that route, build up something small so you can learn marketing, book keeping, licensing, contracts, making processes more efficient and on and on and on. Then make the big leap once you have a grounding knowing that the next level will be a whole other set of challenges.

Also, companies on BizBuySell are generally massively overpriced because everyone overvalues what they have and thinks they are on shark tank. Unless you have skills in how to educate them and bring them down to reality, you may get your ass handed to you.

Copy, thank you!

 

[Crowmangler]

On a fireman schedule, I'd shoot for work I could schedule and keep my day gig. You have fantastic retirement benefits coming and decent pay for your efforts.

You could take on several ventures, depending on what you are skilled and motivated by.

THIS... I know a handful of firemen who operate their own small businesses. Other than maybe a teacher it's the perfect schedule to have a side gig