Adding on our 2nd truck.. what to know

[WillS]

It is time! We are adding on our 2nd truck after being open for a year. July 23 of last year to be exact. We've grown and overbooked the last several months and want to cut back on these 7am to 8pm, 6 days a week plus computer work after 8pm. This is unfamiliar for me and my partner because we are now hiring a 2 full time employees and know that we will need workers comp now etc.

Any information you can help provide on these items:

- Payroll, what program are you using?

- Workers Comp, How much is it usually? Best company to go through?

- We have liability insurance for the company, $1 million, $2 million agg. already through Farmers, but we must have to add employee liability insurance or whatever else they are offering. What is necessary?

- Health Insurance. I was reading if the employee's are paid over 13.88 I believe it is an hour, the company doesn't have to provide Health Insurance. Do you provide your employees Health Insurance? Are most of them full time or part time?

What else am I missing?

Really could use any suggestions/help with these! Trying to get an idea on what we are looking on spending right away, by adding the 2 employees.

 

[renegade_cowboy]

It is time! We are adding on our 2nd truck after being open for a year. July 23 of last year to be exact. We've grown and overbooked the last several months and want to cut back on these 7am to 8pm, 6 days a week plus computer work after 8pm. This is unfamiliar for me and my partner because we are now hiring a 2 full time employees and know that we will need workers comp now etc.

Any information you can help provide on these items:

- Payroll, what program are you using?

- Workers Comp, How much is it usually? Best company to go through?

- We have liability insurance for the company, $1 million, $2 million agg. already through Farmers, but we must have to add employee liability insurance or whatever else they are offering. What is necessary?

- Health Insurance. I was reading if the employee's are paid over 13.88 I believe it is an hour, the company doesn't have to provide Health Insurance. Do you provide your employees Health Insurance? Are most of them full time or part time?

What else am I missing?

Really could use any suggestions/help with these! Trying to get an idea on what we are looking on spending right away, by adding the 2 employees.

Kudos to you..

Look into intuit (quickbooks) online business center, it will give you what you need for having an employee.. including payroll.

Workers comp changes from state to state.. and your general insurance will cover any damage your tech does.

Buying two of everything also get pricey and you will need a lot of patience.

 

[Shane Deubell]

If you want to do it yourself then quickbooks has a tax pay plan with all the formula's you need for payroll taxes. Remember you need to do the employee withholding also.
Workers compensation and disability insurance you will need to shop.

We just use paychex and they do it all, i'm too incompetent of an administrator

 

[TomKing]

It is time! We are adding on our 2nd truck after being open for a year. July 23 of last year to be exact. We've grown and overbooked the last several months and want to cut back on these 7am to 8pm, 6 days a week plus computer work after 8pm. This is unfamiliar for me and my partner because we are now hiring a 2 full time employees and know that we will need workers comp now etc.

Any information you can help provide on these items:

- Payroll, what program are you using?

- Workers Comp, How much is it usually? Best company to go through?

- We have liability insurance for the company, $1 million, $2 million agg. already through Farmers, but we must have to add employee liability insurance or whatever else they are offering. What is necessary?

- Health Insurance. I was reading if the employee's are paid over 13.88 I believe it is an hour, the company doesn't have to provide Health Insurance. Do you provide your employees Health Insurance? Are most of them full time or part time?

What else am I missing?

Really could use any suggestions/help with these! Trying to get an idea on what we are looking on spending right away, by adding the 2 employees.

You might want to search some of the topics you are looking to this stuff has been talked about to exhaustion.

My advice use a payroll company.
Truck 2 going to truck 3 will be really hard and take more focus for advertising and managing people.
Limit the office work and put the responsibility on another company.

Many of your questions are state specific. Workman's comp, insurance etc.

 

[Able 1]

You will also have unemployment tax which is like 9%(in WI.) of what you pay them.. Really the cost of having employees is minimal finding good one's should be your main focus, and is the hard part.. My tax lady takes care of payroll and anything else related, she is awesome!! Are you planing to have both of them work by themselves, or are you and your partner going to use them as helpers?

Btw I would have never done the "partner" thing.. So, now you are expanding to one van, unless I took the word partner wrong..

 

[WillS]

Well, me and my biz partner have been using one truck and do all the jobs currently. We will continue to, but now running 2 trucks with 2 helpers... Or being able to put them out together on a slow day, so we can take more same day appointments. We get a ton of same day or next day and we book up a week in advance 3 weeks out of 4 in a month. Only slow month here is June, and this June was crazy. I don't know why its so slow, maybe because people are just adjusting to the 114 degree temperature change. Busiest months are Sept-Dec for us. Since that is coming up soon and last year we did over 12k with one truck per month during that time.

 

[WillS]

I might need to find a tax lady. The one I used to have do our taxes before becoming an LLC all of a sudden wanted a ton more. I turbotaxed it last year since I had everything recorded, can find my way through a program. Since it was the first 7 months of being open, we took a loss because of all the purchases of equip, truck, etc.

 

[Able 1]

At 12K my helper will barley if ever hit 40 hours a week.. I might focus on a big advertizing plan if you are going to go foreword to two vans. If you are going to hire for a full time position better be able to back that up with work, or good workers might walk for a better more consistent job..

 

[Able 1]

I might need to find a tax lady. The one I used to have do our taxes before becoming an LLC all of a sudden wanted a ton more. I turbotaxed it last year since I had everything recorded, can find my way through a program. Since it was the first 7 months of being open, we took a loss because of all the purchases of equip, truck, etc.

Last year I paid my tax lady $850, but it goes up a hundred a year due to more work(I agree she has more work every year).

 

[WillS]

Really at 12k your helper wouldn't be working? We need 2 of us to be able to do what we do. 3-4 jobs per day sometimes 5. After expenses we are still profiting enough to pay decently. We turn away 10-15 jobs a week right now because of scheduling. It takes us longer to clean of course, depending on the quality of the carpet, upholstery, whatever we are doing. We are all low moisture cleaning using machines with bristles, pre spray, dry compound, etc. Cleaning process takes longer.

 

[WillS]

Not to bad on the amount for the accountant... I'll have to shop around in our area a bit more.

 

[Shane Deubell]

At this point you definitely need professional tax advice. Min yearly, quarterly is best.

$12k month for a van is not a lot, double that would be. Good idea to have a second set up anyway but over the long term you want to jam in as much $$ as possible into each van.
I know it seems far away now but we work off repetition and if you set up the first one like this then you will just keep repeating. My advice would be to slow down {mentally not sales} and plan this out for the long term. This is more like a marathon and not a sprint.

Sounds crazy but i know people who have 4-5 vans and $400kish in sales, they are not too profitable...

 

[Mikey P]

Sounds like the reason you are so busy is that you are providing above average results with below average prices.

VLM can be accomplished pretty cheap but you must still be using enough chems and gas to account to something notable. If you're both young with no debt and plan on low wage helpers the 12k per van could pan out but I'd imagine you'll get sick of the heavy work load soon enough.

If your goal is to both get off the van and run crews you may not want to train your original customer base that cheap and good is what you're all about.


Unless you feel you can do it in volume and have 20 trucks out there with 40 guys all happy to bust ass for $10 to $12 and hour, all while charming the homeowner and being very skilled in explaining why the limited results with your non extraction method.

Vegas is a huge market
Low prices is probably the way to go there.

But can you find charming techs who can walk the walk?

 

[Desk Jockey]

I'd upgrade your system which will allow you to be more productive and increase your margin.

If low moisture is your deal then offer low moisture and low moisture HWE extraction as an upgrade.

We turn away 10-15 jobs a week right now because of scheduling.

Are you fooking retarded? 40-60 jobs a month? 40 x $200.00 =$8,000.00 x 12 months =$96,000.00 plus

You're giving away 100k a year? What's your zip code?
I'm moving into your neighborhood. Don't worry I won't take work from you, in fact I'll give you back a percentage for all you give me.


Seriously I would look at adding another truck. That's too much work that is coming to you, only to pass on because you are too busy. What about starting slow and just getting more equipment and another vehicle? Split up, low moisture doesn't really need two people.

Sure you won't double your production ability since its one man crews but you'll still get more done than the two of you on the same job. It might be a bit harder and you'll have to break a sweat but it will be worth it. Then add a helpers as you grow, if you still feel they are needed.

 

[TomKing]

Ok you put it out here that you want advice on adding a second truck.
I assume from you comments and wanting employees you intend to be multi truck.

Here are my thoughts on the numbers

You’re doing $12,000 monthly
21 working days
$571 per day average.
3-4 jobs a day let’s take 4 $142 average job
Missing 10-15 jobs weekly because of lack of capacity. $1420- $2130 lost revenue.

This is how I would be thinking.
1. Raise prices or add on services job average is to low
2. Upgrade to a truck mount $900 month gets you a brand new CDS 4.8 loaded
3. No employees yet, the increased production and ease of cleaning will allow one of you to go out solo on slow days to market. You will also be able to sell cleaning services you did not have.
4. Set up a plan for a good used second van after the new unit. If you want to grow you have be able to blow it out and used equipment will fail you often. You don’t have time to be in the pits. Business is a competition you have to out run your competitor’s.
5. Use the second van as overflow and last minute. You can run your current set up as back up and over flow right away.
6. When the two of you are maxing 5 days a week get an employee to swing from truck to truck as needed.
7. Start training that employee to go solo from day one. Never hire or look at anyone that you think cannot run solo.
8. Makes sure your image uniforms, trucks, sales material looks as good as any national company.

Employee’s sound nice you are not there yet. No one will work as hard and as long as you and your partner. Employees will require time you are not expecting, they will break things, go slower and make mistakes that will cost you money. Even the good ones.

I would look at these numbers as targets for average production.
$16,700 gets you a truck doing $200k annual
$793 daily truck production
$198 job average 4 jobs each day.

you will need $56.00 more on each job to get to this point under your current pricing.

Do you serve the type of client's that you can charge more?
Do you have additional services that have higher margins?

If not get some soon.

You will feel less pressure having to make a truck payment than having employees believe me.

Just my thoughts on the numbers.

Marketing
Get a written plan to be the high end choice in your area.

It sounds from your description like you are starting as a low cost low moisture company. I in my short years in this industry have never meet a multi truck owner who is not on the truck that does your model.


You can be the first or learn from those that came before you. If you must blaze your own path go for it. The super high way that has already been paved is a lot less resistance and the speeds are faster for bigger thrills.

 

[Shane Deubell]

You will feel less pressure having to make a truck payment than having employees believe me.

Just my thoughts on the numbers.

Marketing
Get a written plan to be the high end choice in your area.

It sounds from your description like you are starting as a low cost low moisture company. I in my short years in this industry have never meet a multi truck owner who is not on the truck that does your model.


You can be the first or learn from those that came before you. If you must blaze your own path go for it. The super high way that has already been paved is a lot less resistance and the speeds are faster for bigger thrills.

Ding, Ding,Ding
You see that over and over and over again. People trying to put together the cheapest set up possible and not thinking about the big picture.

I would much rather run 1000 hours on a piece of equipment then supervise 2000 hours in labor.

 

[Art Kelley]

Are you fooking retarded? 40-60 jobs a month? 40 x $200.00 =$8,000.00 x 12 months =$96,000.00 plus

You're giving away 100k a year? What's your zip code?
I'm moving into your neighborhood. Don't worry I won't take work from you, in fact I'll give you back a percentage for all you give me.


.

This is a great thread. I turn away several jobs a day, just like Will. His numbers and mine are similar. I had a friend helping me for a week after an injury and he heard me talking to many customers on my cell putting them off to an unbelieveable future date (which many couldn't even fathom) so they were gone. He was like, "geez Art, just get another truck and I'll run it." Ah, no thanks. It's not really retarded, it's a conscious business decision. Putting employees out there doing work with your name on it without your control is a whole nother ball game. All those calls you get, all those people waiting, could evaporate like dust. I'm just saying.

 

[WillS]

Right now we have all the equipment for a second truck to do everything. We are buying the truck this week with cash so there will be no payments. We service pretty much all areas surrounding us, and do need to start focusing on the higher end neighborhoods where Criss Angel, Brittney Spears and all the $$ people live. Those are the customers we need to start focusing on. When we first started we took customers from every where and offered tons of discounts. Now we are competitive at the pricing level of our competition. We charge $40 a room and have the ad ons like everyone else for pet urine, red dye, etc.

How much are you making per truck/van? During slow season and busy season or yearly?

 

[Desk Jockey]

Art I love you but dude....you're retarded!

Seriously I get it, its for each of us to chose but what it sounds like is Will wants more. He is just trying to figure out how to best do it.

I apologize for retarded. Stoopie is the more correct term.

 

[Desk Jockey]

Right now we have all the equipment for a second truck to do everything. We are buying the truck this week with cash so there will be no payments. We service pretty much all areas surrounding us, and do need to start focusing on the higher end neighborhoods where Criss Angel, Brittney Spears and all the $$ people live. Those are the customers we need to start focusing on. When we first started we took customers from every where and offered tons of discounts. Now we are competitive at the pricing level of our competition. We charge $40 a room and have the ad ons like everyone else for pet urine, red dye, etc.

How much are you making per truck/van? During slow season and busy season or yearly?

$40.00 is damn cheap for rooms in some of those homes (A 20x20 room is 400 sq/ft $40.00/400 =.10 sq/ft). But as long as you are happy with what you are making then who really cares.

P.S.
Oh, we'd be $140.00 for that same room you did for $40.00.

 

[TomKing]

Right now we have all the equipment for a second truck to do everything. We are buying the truck this week with cash so there will be no payments. We service pretty much all areas surrounding us, and do need to start focusing on the higher end neighborhoods where Criss Angel, Brittney Spears and all the $$ people live. Those are the customers we need to start focusing on. When we first started we took customers from every where and offered tons of discounts. Now we are competitive at the pricing level of our competition. We charge $40 a room and have the ad ons like everyone else for pet urine, red dye, etc.

How much are you making per truck/van? During slow season and busy season or yearly?

I hate to break it to you those type of high end clients don't want you dragging a buffer in the front door. There is probably already someone doing those accounts and they are not driving round in a pick up truck with a buffer like the one they saw the janitor use in high school. Nothing says overpriced janitor like a buffer when you are trying to be a high end carpet cleaner.

I really do not mean this to be rude but celebrities will be really slow to use someone who is young. Age is probably not in your favor on those clients. They have handlers or house managers. These people will be looking for discretion and maturity.

The right equipment, systems and looking like a professional will be a must for the ultra high end.

Target normal high end. Top 30% wage earners in your area. Top 25% home values. There are probably tons of those. Think the tech folks who have money Zappos types.

These type of folks will admire a young guy looking sharp and trying to get ahead in life. These will also be your long term clients.

Celebrities are manufactured every day in America and they burn out like a bottle rocket. BAM.

 

[WillS]

Gotcha I didn't mean actually cleaning those celebs home more of the houses in that type of area lol. We don't use a floor buffer, we are using HOST machines 3,500$ plus machines that are clean and very professional. Our polo shirts are high quality, etc. Our company shows national brand even though we aren't a franchise. We get pretty great results with the cleanings and over 70% return clients most of the time within 6 months.

The $40 a room caps off at 300 sq. ft. For something 20x20 we charge as 2 rooms so $80. $140 for 2 rooms we would never book jobs if we tried changing that much. Probably depending on our to your area the homes values are different. Housing is much cheaper here than let's say CA

 

[Desk Jockey]

The Host system works well on light to moderate soiling, after than it can still do a good job it just takes more time to accomplish it. Its also is fairly expensive with the compound and prep, so your cost of sale is higher.

Even if you wanted to stay low moisture, a CRB and encap chems would do a fine job for you and still dry rapidly.

 

[TomKing]

The Host system works well on light to moderate soiling, after than it can still do a good job it just takes more time to accomplish it. Its also is fairly expensive with the compound and prep, so your cost of sale is higher.

Even if you wanted to stay low moisture, a CRB and encap chems would do a fine job for you and still dry rapidly.

Richard is being nice.

HWE is going to be your baby.

How do you do tile with a host system?

How do you do upholstery with a host system?

How do you do small power washing jobs?

How do you clean high end rugs?

Not with a Host system. Price does not mean quality.

How do you do Shaw, Mohawk J&J carpet and keep it in warranty?

This is right off their websites.
Mohawk
Requires professional hot water extraction every 18 months using cleaning products, equipment or systems that carry the Carpet and Rug Institute Seal of Approval. Periodic cleaning by a certified carpet care professional using the hot water extraction method will refresh carpet appearance.

Shaw
Recommends only the high performance hot water extraction system, which research indicates provides the best capability for cleaning. The Hot Water Extraction method using high performance equipment should be the primary scheduled method to clean carpets. Shaw Industries recommends the use of Hot water extraction equipment which has obtained a Gold Rating in the Carpet and Rug Institute (CRI) Seal of Approval Program. One way to locate a nearby professional carpet cleaner who uses a hot water extraction system is to contact the Institute of Inspection, Cleaning & Restoration Certification (IICRC)

J&J Industries
Recommends professional carpet cleaning companies affiliated with the IICRC who employ trained cleaning technicians or IICRC professional certified cleaners. J&J Industries recommends that your carpet be cleaned by low moisture or absorbent compound extraction before it shows obvious soiling. Carpet should receive regular deep cleaning to maintain its good looks.

If you are only cleaning carpet this why you have such low averages.

You want to be multiple truck? Yes
You want to have employees? Yes

Who has multiple trucks and lots of employees? Stanley Steamer

They have programed the market that HWE is the best method not to mention the carpet manufactures require it.

In marketing you need to understand voice. Voice is the number of times a sales message is given in a market.

SS is giving major voice to HWE. You need to add to that voice. When a market has increased voice the market grows.

The question is how much of that market can you gain. 1% would be huge for you.

You are trying to send a totally different sales message with a Host system.

Why not sell we using the same system that all the carpet manufactures recommend.

Your cleaning system has a lot to do with your ability to go multi truck.

Your ability to go after high end clients also depends on your cleaning system. They want you to do it all not just one thing.

 

[tmdry]

I would listen to Tom.

I was a "low moisture" company that did very well, 6 figures easily...till I found that my #''s doubled to trippled w/ HWE...and I own now several OP's, CRB's, etc...which we use in conjuction with our TM's.

The 1 hour dry times is not a "precious" as we may think, that is more in the low moisture community. Clients generally do not care or must have dry in 1 hour (our trucks used to say that), they do care for a great job, and are okay "if it takes a little longer". You can still get 1 hour dry times in Vegas's no humidity weather by using a proper setup w/ a truckmount. We've done it plenty of times.

$40 bucks a room is a good price for the Henderson/Vegas area, however I think you are being way too generous w/ 300 square feet max. I would cut that in at least half, than you will see your numbers "double!".

I travel to Vegas several times a year and know Henderson and the surrounding areas very well, was just there 3 weeks ago for a week. There are MANY $1 million dollar homes in Henderson, Summerlin, and surrounding areas. Sure cost of living is less than in most areas, but there is still $$$ out there.

Instead of putting a 2nd truck on the road, why not "dual clean"? Get it done in half the time? Just look at Richard and see why he owns 7+ cimexes and several Orbots...the #'s are all about production. If you want to stick to VLM for now than later transition into HWE when the time is right, why not get a truck that carries up to 3, than you can both go into the jobs plus a 3rd person to help. Reduce the sqft max limits on your pricing, and cut those jobs in half. You should be at least double that amount per month before going to 2 trucks imo.

Than you'll be ready for a TM and be bringing in 500k w/ 2 trucks, not 225k w/ 2 trucks.

Slow season=commercial work. Just in Henderson alone there are a TON of businesses in your area, there are well over 2 million Vegas residents that reside there.

 

[Shane Deubell]

Will, in Vega$ you could do 1 tile/grout job a day and then take the rest of the day off

 

[WillS]

Good info and more to think about. I know for our second vehicle we are going with another low moisture cleaning, pick up. Third vehicle, which if we continue to grow at this rate would be a van in September. We like, and our customers like the low moisture deep cleaning. A lot of customers moving into a new place, home owners, are calling us because of the job a HWE crew did before they moved in that is dirty already. I'm not qualified to say how to clean using HWE since haven't had the experience with it, but there must be good and bad ways, and it seems a lot of the bad comes out in the results we see going into re clean these places.

Tom - we do all of the above you listed - cleaning services. We clean Tile/Grout with HOST machines, you have to use specialty bristles for that type of cleaning, but it gets the Tile/Grout amazing. Upholstery, Mattresses, we use a portable 3 gal Sandia. We have a few of them so when it is several couches in a home or dining room chairs, etc. we can both be running one, faster clean time. High end rugs, again, specialty bristles. We clean a 27k silk rug in one of the high end areas almost every month. So we have our services and quality part down, its the growing part I'm concerned with... We want to be a new voice in the market, instead of following in good ol' Jack Bates direct footsteps.

I'm thinking that our prices could be increased to get to that goal of additional revenue per truck, using the same process. We do a decent amount of commercial, but since we have been working full time, not enough allotted for sales to go out and get more. With this addt. truck will give myself a little more time to do that.

 

[WillS]

Will, in Vega$ you could do 1 tile/grout job a day and then take the rest of the day off

Could just play poker everyday then, awesome.

 

[Desk Jockey]

I'm not qualified to say how to clean using HWE since haven't had the experience with it, but there must be good and bad ways, and it seems a lot of the bad comes out in the results we see going into re clean these places.

There are bad technicians or at least those that are indifferent and don't care about the quality of work they are producing, using every method. Its not the method (HWE, Low Moisture, Encap), its the operator causing those "do overs".

In the meantime I'd raise your prices some, its doesn't have to be a tremendous jump. As it is you're a great bargain for the client but you're due something for all your effort and risk. I don't believe you're taking home what is due you.


Someday, when you're ready demo a TM but don't do it until you're in a position to buy one.
You'll be amazed at the product its capable of delivering, the ease of operation and the production ability it gives you.

 

[ruff]

Great advise so far.

Being proficient in VLM cleaning, while adding hot water extraction to your arsenal, will put you in a good position to capture a larger part of the market.

Marketing, packaging and positioning, are still going to be your number 1 challenge.
Just like the rest of us.