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A Dog And Pick-Up Truck Contractor Has a heart as big as the outdoors and likes working alone. They are easy to get to know. They usually have either a pick-up truck or a van with a dog sitting in the passenger seat hanging his head out the window watching and occasionally barking hello to folks and other dogs while feeling the breeze as the contractor zooms down the road.
They Do Not Think About Retirement and when asked about it the reply is something like “Retire, nope, I don't need new tires yet”. These Contractors Enjoy being their own boss, doing what they want when they want, how they want and works hard. They typically do not feel the need or desire to grow the business or hire employees since they would only get in the way. Most Of Them Run their business as a sole proprietor. They Generally Earn $20K to $40K a year after all expenses.
A Salt of The Earth Contractor Also has a big heart; just not quite as big as all outdoors. They like having employees because they do not want to work alone. As their business grows they like to take time off and enjoy travel and vacations. These Contractors Have one, two or three employees because when the employees get out of line the contractor can hold two of them by the throat; one in each hand and eyeball the third one! This is called “Construction Management”. This Group Will Usually Invest Some money to build a retirement nest egg. Most Of Them Operate their business as a C-Corporation, LLC or Sub-S. They Generally Earn $40K to $60K a year after all expenses.
The Professional Also has a big heart; they just tend to keep it under cover. This group tends to have more employees and have a structured approach to their construction company treating it more like a firm. These Contractors Tend to have 1-20 employees with formal organizational charts, processes and systems in there contracting businesses including a formal documented business plan which is updated and reviewed regularly with a board of advisors.
They Invest Heavily In Marketing - Their businesses. They understand their target market, they use The 80/20 Rule to understand the demographics and psychographics of their prime customer, the ones who generate 80% of the cash and income. And they seek to acquire more of them and will do whatever is economically feasible to turn those customers into lifetime repeat business.
This Group Usually Engages the services of a competent financial planner, banker and accountant to work together in helping plan and develop a financial estate that can take care of them in their senior years and be passed on to future generations. Most Of Them Operate as a C-Corporation, LLC or Sub-S or Partnership. They Generally Earn $100,000+ a year after all expenses.
The Enterprise Level Construction Firms Have 100+ employees and generate enormous revenues. Most of the owners and managers earn about the same as a well-run professional contractor. In a lot of cases their life span is shorter than any of the other contractors due to the enormous stress they suffer trying to navigate their construction companies through the ups and downs of the Business Cycle. The Managers Deal With Issues That are beyond anything the previous groups even think about, including labor unions, government oversight, massive risk and are constantly under pressure to increase shareholder value at any cost.
All too often a board member or powerful outside influence without a clear understanding of all of the moving parts involved in running this type of company feels the compelling need to fly in, crap on everything and everyone with their crazy ideas and fly out leaving a disaster to unfold. Then when things go bad the managers are the ones most likely to pay the price.
The Odd Thing Is It always looks like a fun job until someone gets into it. They need to stop making a long term decisions like suicide or worse, based on short term problems. The other three types of contractors are well grounded spiritually. There are special challenges of running an enterprise construction company.
It is not about the type of contractor you are, how many employees you have or how much money you earn. It is all about life, liberty and the pursuit of happiness. Be the type of contractor that suits you, do the work, you will have results and enjoy yourself.
Contracting Is A Trade Of Choice And For Many It Is A Calling. It is a professional who may wear work boots, tool belt and a hard hat every day. They make our homes and businesses a better place to live, work and play. The formal definition of an Emerging Contractor is "Anyone who is ready to make changes, grow and improve their construction company" Simple, straightforward and to the point.
Someone who currently works as an employee and is ready to strike out on his / her own, Someone who brand new or whose contractor's license expired during the last recession, Someone who has an active business license, contractor's license and looking for projects, Someone who may have dramatically downsized during the recession and is ready to go again, and Someone who is moving to a little less hands-on role in their contracting company could be an Emerging Contractor.
Being an Emerging Contractor is not about having the “Most Employees” or only bidding the “Big Jobs” It is about doing the best that any contractor can do in their specific field by themselves as a one person owner/operator or as with employees, adding additional tools, trucks, equipment and employees when the timing makes sense.
For some, it starts with learning the difference between customers and clients. (Client - Someone who buys construction services and is more concerned about quality than price; Customer - Someone who buys construction services and is more concerned about price than quality.) It's getting that first project and how to deal with the paperwork. As they gain clients and find out who your best client is, where they live, and how your construction company can provide the products and services they desire and do it in a way that increases your construction company sales and profits.
For others, they now have experience from before that they want to build on and grow a larger company with 3, 4 or 5 steady employees working full time. Keeping the pipeline full with work, doing a little less hands-on in the field and a little more in the office, estimating and meeting new clients.
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