I'd like to introduce myself, I've been reading the forum for several months now and have learned a good bit. For the past 5 months I've been moonlighting as a mechanic for various construction contractors repairing and servicing their machines. My day job is heavy mechanic for the government so no conflict there. Since I started, I've always had at least 2-3 weekends booked, and some evenings too. Right now I have probably 4 weekends worth of work on my plate, and very possibly another 4-6 around the corner. At what point do you put your two weeks in and just go full time self employed. I searched all over for ideas on this but all the web articles are written by cubicle dwellers. Can I get some input from other independents out there? Also, how do you charge for travel. All my customers so far have been within 30 minutes from home so I don't charge for that. Any info would be appreciated.
Let me start by saying> welcome to the forum.. I like your user name.. Its NEVER an easy answer and there are a lot of threads on here about the same.. 2 come to mind right off.. Taxes and benefits, such as insurance, health AND business and payed time off.. I don't know how important taxes are up in Alaska but if you get caught NOT paying them down here, the govt will make your life miserable.. If the work is steady/constant and you make enough to live on, COMFORTABLY.. go for it.. Travel cost is usually by the mile..for an independent.. regardless of the time.. Most/a lot of companys charge from the time the tech leaves the shop to the time the tech gets back PLUS milage.. THAT makes for lot of arguements by customers in my opinion.. I once spent 2 hrs on the hiway because of an accident w/ no way to turn around.. and I could SEE the customer.. and he could see me.. at 110.00/hr he was NOT happy when I got to him.. all I could say was, take it up w/ the boss.. He ended up paying the bill because we had no control over the traffic.. ps. my boss can sell snow to an eskimo.. As far as insurance and benefits go.. I'll use me as an example.. Lets go back to 2015.. I hurt my back, NOT at work.. surgery required.. filed paperwork w/ my job for medical leave.. 2 days before surgery, my home shop caught on fire and burnt to the ground.. ALL my tools,mowers,boats AND a customers injection pump was inside.. NO INSURANCE.. I had to replace EVERYTHING.. 1600.00 for the inj. pump alone.. Fast forward 2 days, surgery was a mess, was out for 6 months BUT got a paycheck from short term disability from my job.. not to mention all the medical bills that came in , most were picked up by the company insurance.. Fast forward 1 year.. I crushed my back good, this time..still off the clock.. 2 rods and 6 screws at a cost of around 100k.. and 3 days in the hospital.. I'm still gonna have to pay but the insurance is getting MOST of it..AND I'm getting a paycheck.. SO, those are just 2 examples of the things your going to HAVE TO put to pencil and paper when figuring in the cost of doing business.. It sounds like your service truck is your life blood.. how much to replace it.?? with all the bells and whistles you NEED.. 30-60-75k.?? I think about jumping ship EVERY DAY.. THEN, 2015 pops in my head.. and I just work on the weekends.. when I want to.. Its a REAL HARD decision.. especially when 1, 5hr job on a Saturday, will net you AS MUCH as a 40 hr paycheck, workin for someone else.. I've wrestled w/ that for over 10 years.. Good luck w/ your decision and don't burn any bridges when you leave.. you never know when you might need to cross it again..
And allow enough to start putting money into a retirement fund from the start. There are way to many good folks out there that are trying to still work because they keep putting off retirement funding and now have none or very little retirement income. A little now will go a long ways later.
To answer your questions. Travel time is one of the more expensive things you will do. Travel is time you could have been working on a closer machine or something in the yard. Travel gets billed at the same rate as working on the job site. If they don't like it they can bring the machine to you. Mileage: your service truck gets torn up when you drive it around. It will need to be replaced fairly frequently if you want to stay on top of wear and tear. Charge for mileage and save those pennies or you are going to be holding the bag when the truck is worn out. As for when to go full time, when your rates are almost as much as established, successful competitors or comparable businesses, and you have plenty of jobs backed up, and your income after costs AND vacation figured in AND benefits and insurance you are now getting AND sick days figured in, still pencils out with a generous reserve (nothing ever works as good as we hope it will at first), then strike out on your own, providing you have a good cash reserve to cover the inevitable losses at the beginning and unforeseen costs. You need to be good on the book work so you can figure out if any of this is working, etc. Good advice.
You sound like you're in a very similar situation to myself. I have been thinking about branching out on my own for a little while now and have the wifes full support to do so. I have a couple fleets that can keep me busy at all times and a couple that would come to me if I had more time for bigger jobs, along with a couple of other mechanics around that would send me work when they are backed up. The main reason I have not done it is benefits, I work for the city and have retirement, paid vacation, paid sick, paid family sick, paid personal, and a ton of random holidays. Not to mention I have good insurance with the employer paying most of it including long and short term disability. And finally, retirement. I look at my dad who is my hero, and he didn't start a retirement until his mid 40's He is nigh on 60 now and still a light and medium diesel mechanic, but it is tearing his body down, it's taking a toll on him and he can't stop because he still has bills to pay, whereas they way I am set up right now I can retire between 50 and 55 and live well. I can make the extra cash on weekends, random holidays, and personal days but take the benefits from my main job. I had an uncle that was a great mechanic. He started his own shop and it lasted about 8 years, he now works for the rail road. He loved wrenching but hated the business side of it.
Forgot to mention about MY travel time.. If it on my way home from my regular job, I don't charge anything, just because I'm in the truck already.. I can normally fix the problem while I'm there and just charge for the repair.. Now if I get called out on the weekend, I'm in the same situation as you, no more than 30 minutes each way. I charge 50.00 for a service call.. I figure 50.00 an hr is ok for driving.. If its longer than 1hr to and from, I charge accordingly but 95% of the time its 50.00 for a service call. I can be at 2 MAJOR interstates within 30 minutes of my house and meet a lot of my customers there.. 50.00 pick-up & delivery fee..
I appreciate all the input from everybody. I read through many many posts here before making my own, don't wanna be that guy who asks the same question for the 100th time. I'm in a comfortable position in life now because my house is mostly complete, all paid for, military pension and health insurance as s well. I love working on heavy equipment and being my own boss, in charge of my own destiny, but working weekend after every weekend is getting old. My kids are growing up fast and there's no time to work on home projects. That's why I'm thinking about jumping ship in a few months when construction will start to move ahead again. Am I disillusioned that I'll have more freedom to do what I want? I'm not so good with penciling out breakeven costs and analyzing profit mumbo jumbo but I do put every dollar back into my business. I just bought another truck with more weight capacity since all the weight in my 3/4 ton is taking a toll on the suspension. I refuse to borrow heavily for a nice fancy rig, so I'm working my way up. In the past 5 months I've grossed about $10k in labor doing work on weekends. I have lost jobs due to my obligation to my day job. Just not sure where to go from here. In regards to travel: I'm considering half my normal rate, then add $1.50 per mile. I h 've a hard time charging a customer full rate for me operating a steering wheel. Anything wrong with that? Maybe I'm being overly cautious or just cuckoo for cocoa puffs!
My experience: 1. You will be able to spend more time with your kids but it is work time. This I think is great as taking kids to work is better than them playing video games. I worked a fair bit as a kit and I (kind of) liked it but I certainly appreciate it now. It is real nice to be able to simply schedule a day long outing with the wife and kids during the week so we don't have to fight crowds and I can easily make it up on Saturday if I need to. 2. I never have time for home projects because as soon as I think I will do one the phone rings with some emergency and I have a hard time telling a customer they will have to wait just so I can hang sheetrock in my house. I don't know. I love to work and so I have more time to do what I want, of course I need to balance that with family and such. I also like to do research and I like the business end to see profits being made (if I am making them, sometimes I am afraid to look). If you don't like the bookwork you better come up with a good plan for that. Almost all the small businessmen I have known have been ripped off by bookkeepers at one time or another. I could say a lot of things to this. This is what I will say: Charge less for whatever you want more of. If you want more drive time then charge less for it. If a customer has a machine out in the bush and they find it easier to pay you to go out to it then that is what they will do. If it costs them then they might load it up and haul it in where it is more convenient like if they have a yard in town. Then it will be less frustration for you if you need to run for some small part, etc.
Like I said, I'm fortunate enough to work a regular 30/40 and moonlite after hrs and on weekends.. when I want.. Unless I get a call before I turn my phone off Friday nite at 8PM.. My standard answer on a Saturday is.. I'm out in the middle of the lake at the moment w/ the family.. I HAVE NEVER, EVER, had a customer shut me out for that.. especially if I tell them, I'll cut it short and call you when I get back to the house.. 100% of the folks understand that its the weekend and family time IS IMPORTANT TIME..
I charge my full rate plus $1 a mile for road time. It's more expensive for you to run the road then it is to have the truck sitting on a jobsite being a toolbox. I also charge more for field calls then I do for work at the shop. since I have guys at the shop I encourage customers to bring there equipment to me. It's kind off hard to do but I also encourage you to raise your rates Untill you lose a customer or two. It's easy to get a lot of work if your the cheapest guy around. But I've never seen someone successful that was the cheapest guy around. It's better to be one of the most expensive guys. That being said if your gonna charge more then anyone else your work had better be top notch. Also remember your customers are not your friends.
1) It's not your fault the customer's machine died far away from you. 2) You can only physically work so many hours, you have to get paid for every hour or you're shortchanging yourself. 3) My $.02. charge your normal hourly rate plus mileage for travel and try to make sure the customer knows up front an estimate for travel. If you want to cut somebody a break after the job is complete for some reason that's okay, just don't make it a habit they'll learn to expect. 4) Always keep in mind, there are other jobs you could be working on and making full rate instead of trucking down the highway to outer podunk to fix something the operator probably broke anyway. The warm fuzzies are in making the repairs yeah?
Wow! The second round was better than the first, but all great info. I see your perspective and definitely agree with the charging regular rate plus mileage. I would rather be making more of the full rate, not half. I haven't advertised and I still have plenty of work, and having a hard time saying no because I'm trying to get established. I have some down time this coming week for a medical procedure so I'll make it a point to get smarter on the books and come up with a plan for that. Also, I have a customer that needs internal engine work on a skid steer but doesnt want to give up shop space . I don't have a shop to put it in because I'm a mobile mechanic. If I have to rent space do I charge for that?
If he has a shop and doesn't want you to use it tell him to take it to somebody else don't rent space if he already has it. You don't have to work on them all. only work on the one's that people are glad to pay you and you don't have to chase your money or you will always be financing there repair's and working to pay your bill's while they are sitting at home or on vacation.
All of the advice given so far is great. Hopefully I don't double up. If you've been moonlighting for five months that's not long enough to make an educated decision to leave a good job, I assume it's good. Funny thing is about a third of the work you have now you will never hear from them again. Or you'll have to spend your time chasing them to get paid. If you want to do your own thing, great. Be strategic about it. Take the better jobs for side work. You don't have to do it all. Save that side money to equip yourself to be as ready as possible in a couple years of whatever it takes. Don't set a schedule for this. At the very least go a full year to see if a busy or slow pattern develops with work. Charge all you can get. They called you, they need your services. Keeping good books is essential, especially when you make the transition to self employed. Junkyard
Don't say no, let the rate do the talking. If you are booked out then there is no reason to get talked down by someone who doesn't want to pay full tilt. Every time I have done that I seem to regret it. Just not the customer you are looking for. If you can't measure it you can't manage it. You have to know if you are making money or losing. I have 2 books, one business and one personal and two bank accounts. That way profit is what flows to the personal and whatever just stays inside the business is not profit, pretty easy to tell. Figure your actual costs, add 30% for the hassle of administration or more if it is more hassle. If he demands to know up front then add a lot more, like double and then some. You know how engine work gets bogged down for weeks waiting for parts, etc. I disagree with the other fellow who said tell him no. Just figure a cost that you are going to make money and not break even or lose, and if he doesn't like it then move on to the next one.
Like others have said, and I cant stress it enough.. don't chase the loosers.. I have 1 customer and ONLY ONE.. that fights me with EVERY phone call.. He's a REPEAT customer and I've made my money off of him in the long haul.. BUT the aggravation is mind boggling.. I should take my own advise and cut the cord for good, but that easy money is right down the street.. Its gotten to the point I hang up on him when he starts that, "well so and so can do it for this amount".. crap.. He waits a day or 2 and calls me back.. and I end up w/ the job anyway.. Like I said.. aggravation..
That's funny, I know a guy just like that and he called me for availability. Knowing he's a tough customer like that, I tell him I'm booked up when he calls. I think I will devote some time this week to figure out a way to throttle back on the side jobs and free up personal time. As well as make sure the business end is taken care of. I have a separate bank account and book, just have to start counting beans to make sure everything pencils out. All very good advice, I really appreciate the input, thanks!
Well I went full time self employed earlier than planned. I was going to wait until spring to make the jump when construction and mining picks back up but a reputable construction outfit wanted me for an over-winter fleet repair deal, and promised at least 30 steady days of work(rest of year). It's been a week and a half now and everything is going good. I've been working on telehandlers, pickups, and regular forklifts. They also have some medium/heavy duty trucks, and manlifts that need work as well. I'm not too crazy about wrenching on pickups, but it's a package deal, and looking to be an annual thing prepping their equipment for the next season. Good steady work for when everything slows down. AND, it's inside where it's warm! (-29 degrees today) Three of my other customers have already pledged me some work in January, and April, so I think I'll be fine. If there are some days without work the rest of the winter, that's fine, I'll just work on completing the house. I won't starve. However, if things get too slow, I might consider posting on craigslist but not sure what kind of clientele to expect from there. Anybody have experience with that? I took your guys advice and boosted my travel rate, bought some business accounting software to track my numbers, figured out my overhead cost, and met with a Small Business Development Center advisor. The advisor was amazed and said most everything is up to snuff, just have to make a couple changes. I appreciate all the advice here and I check the forums everyday to keep learning.
Good for you.!!! It sound like you have a plan.. & work.. LOL I had a CL ad once.. I got afew call for inj. pump leaks and overhauls.. made some fine, repeat customers. The key to that is> don't over post.. do it once a month and THATS IT.. anyone "searching" the system will be able to pull it up.. If you post every week, people think your desperate.. and that's not a good thing.. BUT, like everything else on that page, people are looking for a DEAL.. so you might have to "wiggle" your rates abit to get THAT customer. Any advertising is good, especially free advertising.. and don't forget about word of mouth.. Do your best to make the customer happy, BEFORE you leave. I hope it works out for you.. Stay warm..
No you won't. The phone will ring a day or two before any such project and you will get a job that fills in the "empty" day and the house will stay unfinished. At least that is how it works for me.
Yup, and you will end up with a constant short list of "When you get a chance" requests you can fill in with, though as pumpguy sez these customers will be hoping for a bit of a deal... it's all good as long as it pays though!
LOL, that's usually how things go, right!? If I stay busy enough then I should have enough money to hire some help for completing the house.
Hope your new job has enough margin to cover the good benefits(vacation, sick days, retirement, 401K) as the government one typically has. Otherwise they are other expenses you need to cover in you rate.
Oh yeah, I'm covered in that aspect.
Sounds like you done well. Keep us posted and update us on side projects as you can. Good luck.
Copy that, will do.
Lots of good advice here. I've been thinking a lot about getting my own truck as well lately. I know the wrench end of it but I've got to school myself up on the actual business end of it.
Well guys, I've been at it for a month now and lucky enough to have had steady work from one customer. Been pretty much working on telehandlers, forklifts, and a couple trucks. Pulled and split a tranny for repair then reinstalled. Rebuilt wheel ends, shimmed sloppy booms, fixed a bunch of electrical and hydraulic issues, etc, etc. Basically working on a neglected fleet servicing and repairing a whole myriad of things. I'm done with them for a few weeks until more parts arrive and I take care of a couple other customer's small jobs. I met with some other potential customers, who express interest in my service in the spring. I had a C15 repair lined up for this week but we just got ~12 inches of snow over the weekend so the customer delayed a week. In the meantime, I'm working on getting my service truck squared away and working on the house while I can.
The work seems to be rollin in.. good.. but how about the $$ ?? Are you getting paid on time?? Are you getting weekly pay or when the jobs done?? Are they buying the parts or are you footing the bill till the jobs done?? A lot of PROFIT is made from marking up the parts.. NOT over what they could buy them for, but using your discount and then marking them up to, over the counter prices.. which usually equals out to your time & gas going to get them.. I know 1 guy personally, who gets a dealer discount at my place..just because we like him.. he sends HIS customers in to pick up and PAY FOR the items using HIS discount.!!! He'll preorder the items and have the invoice cut for pick-up.. I told him he's leaving hundreds of dollars on the counter and asked him why?? He said, its just easier that way..WTH?? Some things just cant be taught.. I can say, he's ALWAYS busy tho.. Keep up the good work..
Getting paid weekly with this one customer and they want to buy the parts. Usually I buy the parts, but Im not complaining since its a big volume of work.
some good advice came around on this post. in my opinion the biggest motivation to go fulltime for your own company, should be that you want to have your own company. cause in the end no matter what day job you got, working for a boss will Always be easy money, compared to doing the same thing for yourself... long days, short nights, staying away for a few days, money issues etc etc... it can be stressfull every now and then.. So to be able to go back to that "special" feeling off having your own company will hopefully help you through the though days. Cause it's not only gold that shines! I would suggest to get some good Insurance, i know you guys have different Insurance then we have, but ive got a Insurance that will pay me in the event i get some health issues what makes me unable to do my job again. after haven spoken with two guys who just got into an accident on the highway and both where unable to work for them selfes anymore, didn't had that Insurance (cause its a expensive one!) and they now need to get round with a few €100,- a month from the goverment, when otherwise they would be able to get €23-30K a year.. i've got a wife and two kids so i got to play safe on some spots. Make sure you know what kind off risk you want to take and what kind of risk you can't handle. I've made the step 3,5 years ago, worked for a boss 45min from home, had 0 clientel, no daddys workshop(or money..), no money anymore (had to pay back all the courses i had and also the truck license i had from my boss..) my girlfriend was pregnant, so good timing to go and make the big step, but i had my good toolbox and my hands.. But after these 3,5 years i think this year it might be the year, i can take some fruits from my labour.. been investing pretty much every penny i've made within my company. and got one part-time mechanic working for me now and looking into making the step into getting a full-time mechanic to work for me in this year. What a lot off people forget, or don't see on the outside in my neighbourhood are all the nights i've been awake thinking about how the hell i can pay all the bills especially when you're starting up and got a few clients, there are Always a few ones that will pay later then you hope, if they are buying parts then its lots easier, so thats a good way to start your company up! Having €10-30K underneath your clients every month is just normal for me now (and this only goes up with getting the bigger jobs..) so keep an eye that they pay on time and make sure you tell them when they dont! cause the bigger the company the less those guys give a damn about you and your bill.. For the rest if you think you got it in you, and you think you would regret more when you dont do it, then just do it! if you ask 10 people probely 8 off them will say you're crazy.. if you cant make it within the next few years then going back to work for a boss is Always an option! good luck with getting it all sorted out!
BuMach, thanks for the advice. I got a family as well so I take precautions for sure. Might slow me down a bit but I like to keep my appendages whole. Traveled around your country a decent amount, nice people and scenic countryside.