Extraordinarily relevant thread. Thanks for starting it Harper.
I had a fantastic March, but April & May so far has really been horrible. In times like this I'm thankful to have other businesses.
Although the economic situation effects different areas differently , as a nation we have a long way to go before this recession comes to a close. With unemployment at 10% overall and gas prices at $4.00 plus, you have to know we are still in hard times. The owner/ operator that can operate with extremely low overhead and NO SHOP/warehouse RENT to pay can make it through about anything by cutting back and busting his butt working 24/7. The larger operator with 3-10 trucks better have a huge line of credit to keep things afloat. I hear what Harper is saying about commercial and would only add that it is also impossible to really build a business (even with encapsulation) doing commercial work for 5-15 cents a square. I know plenty of guys are advocating that strategy and claiming 2,000-3,000 a square feet per hour etc, BUT reality is a bit different. Sure you can do 2,000 + square feet an hour in large ballrooms, hallways etc. but how many commercial buildings are just huge open areas. Add in all the cubicles and smaller rooms and those great production rates drop fast. A cimex in and of itself will not make a sound commercial carpet cleaning operation. It's not a miracle worker with mysterious powers. It's a tool, a great one but not everything it is trumped up to be. Sometimes you have to extract a commercial account regardless of the size just because it's a trash pit. Sure you can maintain it with the cimex but if that first cleaning is contracted at the same 5-15 cents per square you have lost a bunch of cash on the front end. Who wants to have to to clean a place 4-5 times before you have recouped your losses on the front end ?
You can only cut your gross margin so thin before your credit line is the only thing keeping you in business.
I had a fantastic March, but April & May so far has really been horrible. In times like this I'm thankful to have other businesses.
Although the economic situation effects different areas differently , as a nation we have a long way to go before this recession comes to a close. With unemployment at 10% overall and gas prices at $4.00 plus, you have to know we are still in hard times. The owner/ operator that can operate with extremely low overhead and NO SHOP/warehouse RENT to pay can make it through about anything by cutting back and busting his butt working 24/7. The larger operator with 3-10 trucks better have a huge line of credit to keep things afloat. I hear what Harper is saying about commercial and would only add that it is also impossible to really build a business (even with encapsulation) doing commercial work for 5-15 cents a square. I know plenty of guys are advocating that strategy and claiming 2,000-3,000 a square feet per hour etc, BUT reality is a bit different. Sure you can do 2,000 + square feet an hour in large ballrooms, hallways etc. but how many commercial buildings are just huge open areas. Add in all the cubicles and smaller rooms and those great production rates drop fast. A cimex in and of itself will not make a sound commercial carpet cleaning operation. It's not a miracle worker with mysterious powers. It's a tool, a great one but not everything it is trumped up to be. Sometimes you have to extract a commercial account regardless of the size just because it's a trash pit. Sure you can maintain it with the cimex but if that first cleaning is contracted at the same 5-15 cents per square you have lost a bunch of cash on the front end. Who wants to have to to clean a place 4-5 times before you have recouped your losses on the front end ?
You can only cut your gross margin so thin before your credit line is the only thing keeping you in business.