Reducing Staff....and generally reigning things in a bit...
Discussion
My company has grown maybe a little too rapidly in 2 years ....really struggling with the stress and managing the constant f
k ups everyone seems to be making. Financially things are ok, but some of our suppliers bills are getting a little daunting at times.
Have a decent little back up plan in place which would see our team go from 10 to around 5.
This little operation would tick away nicely with very little input, giving me generally a better quality of life.
Financially, our turnover may not be as high, but actually Im not sure I would make any less profit, bizarrely.
I can't help but feel like its a step backwards, and Im not a quitter which is really pushing me to continue with the new projects.
Has anyone reigned things in a bit and then realised it was the right thing to do ?
One step back, two forward ?
k ups everyone seems to be making. Financially things are ok, but some of our suppliers bills are getting a little daunting at times.Have a decent little back up plan in place which would see our team go from 10 to around 5.
This little operation would tick away nicely with very little input, giving me generally a better quality of life.
Financially, our turnover may not be as high, but actually Im not sure I would make any less profit, bizarrely.
I can't help but feel like its a step backwards, and Im not a quitter which is really pushing me to continue with the new projects.
Has anyone reigned things in a bit and then realised it was the right thing to do ?
One step back, two forward ?
We do electrical rewires, they are lucrative and relatively stress free. Usually 3 a week.
We have recently branched into doing bathroom installation and also doing more electrical maintenance work.
At this stage, bathrooms bring in around the same profit as one rewire. Difference being a bathroom takes a week, a rewire takes 1-2 days.
Bathrooms have potential to be very lucrative once we hit the high end market, but we are not marketed well enough yet to start charging 10k bathrooms.
Electrical maintenance is a lot of hassle for very little profit, but potential to build of good client base with reputable firms, and build the profit, where as rewires are generally a one time customer. We have already started doing maintenance for a few big names, all sounds great but come end of month we are maybe invoicing for £800, not really worth the hassle, unless we had load of these contracts.
I could easily do 4/5 rewires a week, sticking to what we know best and drop the other areas. Id make a few thousand profit each week, and could pretty much play golf 3 days a week should I wish.
Thats not really me though, Ive tried to expand and in theory it should work, its just proving very very difficult at this stage and wondering whether Im taking on too much too soon.
Stick to what I know or in entrepreneurial spirit, try and rough out the teething problems of new venture ?
We have recently branched into doing bathroom installation and also doing more electrical maintenance work.
At this stage, bathrooms bring in around the same profit as one rewire. Difference being a bathroom takes a week, a rewire takes 1-2 days.
Bathrooms have potential to be very lucrative once we hit the high end market, but we are not marketed well enough yet to start charging 10k bathrooms.
Electrical maintenance is a lot of hassle for very little profit, but potential to build of good client base with reputable firms, and build the profit, where as rewires are generally a one time customer. We have already started doing maintenance for a few big names, all sounds great but come end of month we are maybe invoicing for £800, not really worth the hassle, unless we had load of these contracts.
I could easily do 4/5 rewires a week, sticking to what we know best and drop the other areas. Id make a few thousand profit each week, and could pretty much play golf 3 days a week should I wish.
Thats not really me though, Ive tried to expand and in theory it should work, its just proving very very difficult at this stage and wondering whether Im taking on too much too soon.
Stick to what I know or in entrepreneurial spirit, try and rough out the teething problems of new venture ?
Jamster123 said:
At this stage, bathrooms bring in around the same profit as one rewire. Difference being a bathroom takes a week, a rewire takes 1-2 days.
Jamster123 said:
actually Im not sure I would make any less profit, bizarrely.
Sounds like your profit per day would shoot up dramatically if you dropped bathrooms. Unless I'm misunderstanding something.I would only do bathrooms to fill in dead time if you have overheads to pay eg staff.
There is the other side of things, potentially - do bathrooms keep your business associates happy and keep you in the loop for rewiring work? IE could it be seen as a marketing activity of sorts?
I'm in the same boat as you OP, and don't let anyone tell you it isn't tough.
We expanded last year, doubled staff and overheads with the only problem being profit hasn't doubled too! Now, the simple fact is I didn't expect it to, we've got a plan for growing the business and we need to stick to it. It's all too easy to be "this time next year" but in reality if we follow the business plan then this time next year everything should be in place to make a healthy profit-one that has been worth the stress!
The only problem is like yourself, you almost get used to your old ways. In my case it was track days pretty much whenever I fancied, buying pretty much anything we wanted and working four days a week with very flexible hours.
On the dark winter nights with a huge vat bill looming, a massive payroll to fund and a whole host of other unexpected bills that can all look so very far away. But, once everything is realistically in place after around 18 months of trading I reckon we'll be back to how we were and it'll get easier again.
Personally, I figure in business you've got to give yourself a couple of years at these things. If I'm (or you) still where I am now then obviously something isn't right and I will need to reassess.
There's no use in flogging yourself for nothing, but by the same measure there's no point in not giving something your all for a couple of years
We expanded last year, doubled staff and overheads with the only problem being profit hasn't doubled too! Now, the simple fact is I didn't expect it to, we've got a plan for growing the business and we need to stick to it. It's all too easy to be "this time next year" but in reality if we follow the business plan then this time next year everything should be in place to make a healthy profit-one that has been worth the stress!
The only problem is like yourself, you almost get used to your old ways. In my case it was track days pretty much whenever I fancied, buying pretty much anything we wanted and working four days a week with very flexible hours.
On the dark winter nights with a huge vat bill looming, a massive payroll to fund and a whole host of other unexpected bills that can all look so very far away. But, once everything is realistically in place after around 18 months of trading I reckon we'll be back to how we were and it'll get easier again.
Personally, I figure in business you've got to give yourself a couple of years at these things. If I'm (or you) still where I am now then obviously something isn't right and I will need to reassess.
There's no use in flogging yourself for nothing, but by the same measure there's no point in not giving something your all for a couple of years
LaurasOtherHalf said:
I'm in the same boat as you OP, and don't let anyone tell you it isn't tough.
We expanded last year, doubled staff and overheads with the only problem being profit hasn't doubled too! Now, the simple fact is I didn't expect it to, we've got a plan for growing the business and we need to stick to it. It's all too easy to be "this time next year" but in reality if we follow the business plan then this time next year everything should be in place to make a healthy profit-one that has been worth the stress!
The only problem is like yourself, you almost get used to your old ways. In my case it was track days pretty much whenever I fancied, buying pretty much anything we wanted and working four days a week with very flexible hours.
On the dark winter nights with a huge vat bill looming, a massive payroll to fund and a whole host of other unexpected bills that can all look so very far away. But, once everything is realistically in place after around 18 months of trading I reckon we'll be back to how we were and it'll get easier again.
Personally, I figure in business you've got to give yourself a couple of years at these things. If I'm (or you) still where I am now then obviously something isn't right and I will need to reassess.
There's no use in flogging yourself for nothing, but by the same measure there's no point in not giving something your all for a couple of years
I can relate to this, massively.We expanded last year, doubled staff and overheads with the only problem being profit hasn't doubled too! Now, the simple fact is I didn't expect it to, we've got a plan for growing the business and we need to stick to it. It's all too easy to be "this time next year" but in reality if we follow the business plan then this time next year everything should be in place to make a healthy profit-one that has been worth the stress!
The only problem is like yourself, you almost get used to your old ways. In my case it was track days pretty much whenever I fancied, buying pretty much anything we wanted and working four days a week with very flexible hours.
On the dark winter nights with a huge vat bill looming, a massive payroll to fund and a whole host of other unexpected bills that can all look so very far away. But, once everything is realistically in place after around 18 months of trading I reckon we'll be back to how we were and it'll get easier again.
Personally, I figure in business you've got to give yourself a couple of years at these things. If I'm (or you) still where I am now then obviously something isn't right and I will need to reassess.
There's no use in flogging yourself for nothing, but by the same measure there's no point in not giving something your all for a couple of years
Ive had it relatively easy in my first few years, to the point of thinking "Why does everyone thinking running a business is so hard?"
Working in peoples home is extremely difficult, the problems seem endless. The major problem, is mostly staff. I know when I personally do a job, its perfect. Initially thats why the business done so well, because it was me, the owner doing the work. Now Im relying on other people to maintain our standard its proving very very difficult. People just don't have the attention to detail I do.
Ive been through so many staff in last 2 years, its hard to find good guys. The guys who are good, are working for themselves. Ive resorted to apprentices, but in reality they will be 5 years away before being ready.
Within the company at the minute I have 2 lads aged around 21, one is an adult apprentice and the other a sparkies mate. The potential these lads have is unbelievable, and they are learning things just the way I want them to, but in reality they are still a few years away from being self sufficient. I have another 2 lads straight out of school, so they will be a good while away.
I keep telling myself all great businesses had a tough spell, and people didn't get places without taking chances. I take a lot of chances with the business, and they usually work out, but occasionally I do wonder have I pushed it too far this time.
Im hoping once we get past this stage and the apprentices have matured things will come good.
Work type - Doing rewires, your pretty much the first trade through the door on renovations. This means I get a look around first at all the work needing done on the property.
People often comment on how good we are to deal with, and not like usual tradesman, so when I see all this potential work out with rewiring, it pains me to see the opportunity go a miss. Fed up being asked "Do you know a plaster, do you know a plumber etc etc' I thought actually, I could do all of that.
So now when I go to quote on rewiring, I often find myself talking us into quoting for a full plaster skim, central heating, bathrooms, kitchens ...eventually drawing the line at structural work.
So as you can see that initial rewiring job is a gateway to much bigger things. We do rewires on at least 10 renovations a month, so you can see the potential.
I think another major issues is our structure. Im the only managerial type role in the company. Everyone else is on the tools. My wife is trying to help with the admin, but just having a baby things are very tough for her.
I need admin staff like yesterday, but its another wage onto of an already spiralling wage bill.
In comparison, I could get back on the tools with an apprentice only, and do 2 rewires a week. Id be very well off, but thats not my end goal. Rewiring is a hard game, Ive already got major troubles with my knees at 30 years old, so not sure how long that would last.
Im going for a lot of tenders now, hopefully one of them pays off soon, but for now I guess its back to another grinding day.....
Edited by Jamster123 on Thursday 5th February 10:01
johnfm said:
Better off doing boiler installation than bathrooms. One team can do 2 a day. Much more controllable and limited scope than bathrooms. Often a 'must have' purchase (especially in winter) and you can upsell your electrical services (if the property has outdated wiring).
I have a guy who subbies, for me and is very keen to come full time. I subbie maybe 2-3 central heating systems a month to him. Once I nail down the bathrooms, and they are running nicely the plan is to do more CH and take the lad on full time.Cutting back can be very difficult, but you have to do what is right for you, and for the company.
We went through it numerous times, and each time we found it actually made the company stronger as we filtered down, keeping the very best staff.
We managed to reduced turnover and actually increase profit, though part of this came from outsourcing various processes, which may not be an option in your business.
I found it much more enjoyable working with a smaller, but more committed team.
We went through it numerous times, and each time we found it actually made the company stronger as we filtered down, keeping the very best staff.
We managed to reduced turnover and actually increase profit, though part of this came from outsourcing various processes, which may not be an option in your business.
I found it much more enjoyable working with a smaller, but more committed team.
jammy_basturd said:
Instead of dropping bathrooms entirely, can you spin it off into a separate company and either get someone else to manage that side of things, or sell up to someone looking to get into the market/a competitor?
No where near that stage yet mate, We only started doing bathrooms around 4 months ago, the site isn't even full functional yet www.jrcbathrooms.co.uk. The bathroom projects are taking up a lot of my time for not a lot of money. Im looking at bigger picture though, with the right branding/marketing and when Im confident we are really good, Ill start charging a premium. At the minute we charge around £4-7k a bathroom supplied and fitted depending on spec. Another bonus to being primarily an electrical contractor is we know how to create awesome lighting, which is very often what makes a room. I know when we have nailed everything, we could easily charge 10k+ per bathroom. To get there though I need a showroom, catalogue of our products, proper design software etc. Thats a bit away.
Inkyfingers said:
Cutting back can be very difficult, but you have to do what is right for you, and for the company.
We went through it numerous times, and each time we found it actually made the company stronger as we filtered down, keeping the very best staff.
We managed to reduced turnover and actually increase profit, though part of this came from outsourcing various processes, which may not be an option in your business.
I found it much more enjoyable working with a smaller, but more committed team.
The last part sounds appealing, Im definitely NOT enjoying what I do at the minute.We went through it numerous times, and each time we found it actually made the company stronger as we filtered down, keeping the very best staff.
We managed to reduced turnover and actually increase profit, though part of this came from outsourcing various processes, which may not be an option in your business.
I found it much more enjoyable working with a smaller, but more committed team.
Do you do all of the above in one company? As someone else said, could you spin bathrooms off into another company? It seems odd to an outsider that one company would do rewires and bathrooms and if you spin the bathrooms off, maybe it's worth getting someone in to manage that? You'll end up with an extra headcount and a smaller profit but far less stress if someone else is running that side day to day?
Just a quick one OP....
We restructured just over 5 years ago (before our current expansion) to revolve the business around new younger staff and it was the best thing I ever did. Again, I meant a couple of years of hands on management getting them to where you needed them to be but it was more than worth it.
Also, if you're struggling to find the answer to your staff not doing the job as well as you yourself would, try not to worry to much-there simply isn't an answer-they never will!
You can however incentivise them.....
Before I got into my current career I was on the tools like yourself and paid my lads bonus. A most important part of it however was to price in snagging time for anything that we needed to go back and sort. Initially this was so that the lads wouldn't have to spend a morning for nowt tightening up leaky radiator valves or such like, but it also worked as a bonus-if they didn't have to go back they still got their snagging bonus hours without doing any work. And there's nothing a tradesman likes more than getting paid to do nowt
Something to think about.
We restructured just over 5 years ago (before our current expansion) to revolve the business around new younger staff and it was the best thing I ever did. Again, I meant a couple of years of hands on management getting them to where you needed them to be but it was more than worth it.
Also, if you're struggling to find the answer to your staff not doing the job as well as you yourself would, try not to worry to much-there simply isn't an answer-they never will!
You can however incentivise them.....
Before I got into my current career I was on the tools like yourself and paid my lads bonus. A most important part of it however was to price in snagging time for anything that we needed to go back and sort. Initially this was so that the lads wouldn't have to spend a morning for nowt tightening up leaky radiator valves or such like, but it also worked as a bonus-if they didn't have to go back they still got their snagging bonus hours without doing any work. And there's nothing a tradesman likes more than getting paid to do nowt
Something to think about.
AyBee said:
Do you do all of the above in one company? As someone else said, could you spin bathrooms off into another company? It seems odd to an outsider that one company would do rewires and bathrooms and if you spin the bathrooms off, maybe it's worth getting someone in to manage that? You'll end up with an extra headcount and a smaller profit but far less stress if someone else is running that side day to day?
Basically, all companies will hit the vat threshold within months so no point splitting for tax reasons. I have created 3 websites, one for property maintenance/development. One for rewiring and one for bathrooms specifically.
They all have their own names and domains i.e. jrcrewiring or jrcbathrooms, but all listed as "trading as jrcpropertysolutions" at the footer of page.
next step would be jrcgasservices or jrckitchens ...The main site will have links to all the microsites.
The main thing is never to keep trading the same way "just because".
You have to make sure you are getting as close to 100% from each person as possible.
Never 101% though... to much and they will find another job.
Something I do now and then is just take a wander round, see what people are doing.
We are 8 - 10 people at max, and often when we get past our busy period I take a little wander now and then and see what work is actually being done.
That will tell you all you need to know!
You have to make sure you are getting as close to 100% from each person as possible.
Never 101% though... to much and they will find another job.
Something I do now and then is just take a wander round, see what people are doing.
We are 8 - 10 people at max, and often when we get past our busy period I take a little wander now and then and see what work is actually being done.
That will tell you all you need to know!
what's absolutely clear is that you need to change something if the business is too complex to run in its current form. I suggest you read the book 'Good Strategy, Bad Strategy' to get a few ideas on how to separate the wheat from the chaff. It can't be more than a tenner on Amazon and is quite a quick read.
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