April 2018 Recap of Painting Business

April was a fun month for us.  We got to take profit for the first time, get our first bookkeeping accounting reports sent to us, and we made some good choices for hiring people and doing new types of bids.

I've been doing all of our estimates that we've been bringing in.  It's been interesting learning the in's and out's of how to do it, what you actually need to pay attention to vs just kind of rolling it into the price on things like caulking and what not.  It still gets done, but instead of measuring to the inch you're fine to account for it, but without pinpoint accuracy.  After doing it for two months though now and pretty much having nailed down the process for how to do it and what to say there is maybe only one other iteration on it and that would be using an iPad to show content like the customer book and video testimonials.  Beyond that though...I'm kind of bored with it.

It is very straight forward especially since we upgraded to our new estimating software that has pretty much completely eliminated WAG (wild ass guessing).  Prior to the software it was $100 for this wall and $125 for that ceiling etc.  Now you take measurements, enter it into the software, add estimated prep based on each individual situation, and then the production rates from our software that are based on the pdca standards (Painting and Decorating Contractors of America), take our labor cost and material costs and accurately spits out our cost to the customer in a few minutes.  It's excellent, but because literally anybody could do it it has me really thinking I should hire this out and focus on other business building activities that could add additional revenue streams to the business without too much additional effort.  So that is something I'm actively focused.  That will happen sooner rather than later I think once I've got some business foundation things setup and scheduled and systematized.

Numbers from last month.

So we've got our statement of cash flows above for the first two real active months of the business where we were doing estimates and producing jobs.  It is skewed though currently because we've been taking advantage of Sherwin Williams' "test drive".  We're still a few months out from having some trending numbers that will show a better prediction of actual cash flow or not.  We're going to be banking a good chunk of our cash flow as a cash buffer to build up our working capital so we can weather our bills should things slow down.  It was nice to see that big of a net cash flow positive bump in our first couple of months of business though.  I'm excited for the future too because in the contracting class and just by reason of logic overhead costs are never higher than at the beginning of the business since you can't take advantage of the scale of your production and systems as much as you can later when you have increased lead flow.  If we were done building up working capital last month's income would've been more than we've ever made, which was cool to see.

One of the bigger jobs we landed at first was this commercial ceiling we did in Kaysville.  It kind of blew our mind that we won it, but that excitement wore off after a few days and I started feeling nervous.  A couple weeks ago I made some follow up calls and had one customer follow up with me to tell me that they'd decided to have us do their work, which on that one day alone ended up being about a 3/4ths of what that big commercial ceiling ended up being and it dawned on me that while the big wins are nice the small ones are also nice and just as real.

Bid a huge apartment complex.

One of the interesting leads that came our way last month was a request to bid a 237 unit apartment complex.  A good friend of mine helped me with his take off software and I imported all of the apartment's blueprint plans into the software so that I could measure all of the surfaces and properly account for materials and labor.  It took me hours and hours to do.  All in all I've probably spent close to 15-20 hours on this one bid, especially if you consider travel time.

Our first bid came in around $750,000.  I followed up with the contractor and he straight up told me our price was too high and that he couldn't use us.  What was interesting is that he was pretty open about the other prices that had come in.  I adjusted my prices to undercut all of them and I have a meeting with the contractor this coming Monday to discuss the project.  I think we're 95% of the way there and if we land the job we'll have booked our revenue goal for the year in our first 4 or 5 months of being in business.

I am nervous to win the job for the income potential, but also the loss potential.  If we mess this thing up it could sting pretty bad.  I think we'll be good though and with the margins looking like I think they are even if I mess up by thousands of dollars there is enough padding to hopefully absorb any issues that arise.

It was interesting as the contractor followed up with me amidst an email chain he'd asked his project manager to follow up on the competitor to try and get a response from them.  It was weird to me to actually hear that.  Maybe the competitor was already busy and maxed out, but by my calculations the money to be made is nothing to sniff at.  Let alone the learning experience and portfolio piece that it would add to anybody's portfolio.  We'll see what happens.  If we land that it'll be all hands on deck to figure out how to hire everyone we'll need.  Should be interesting.  If we don't land it I'll be pushing to potentially hire a project consultant in Utah county so that we can start getting jobs and leads and revenue and income from there.  I'm also wanting to learn how to do estimating for sheet rock hanging, texturing, and then of course painting it.

Appointment Setter

One thing that I knew pretty quickly into our busyness was needing to hire an appointment setter.  Some days I wouldn't get anybody calling in to see about us coming out to give them a quote and other days I'd have 4 people call in.  Either of these days I'd either be at home super busy trying to build up the business with foundation tasks or out giving bids to people.  Regardless of what was going on it was really annoying to have to stop everything that you're doing to return a phone call and hopefully set up an appointment.  Or after being out on bids all day to then come home, with the kids going freaking crazy, the wifey is ready for help, but unless you just wanna blow the money on leads to never contact them you better call them back to set up their appointment and then get all of the paperwork and data entry done too so you're not late the next day when you need to go on the bid.

So I drafted up an ad and posted it the local ksl classifieds and also had Ashlee post it to her social media.  We started getting applicants right away, but we also had an old neighbor friend that lived just up the street from us say she was interested and that she could likely get it done for us and be ok with the somewhat erratic frequency of when calls would come in.  So we hired her and it has been amazing.

She text me today saying that in the current pay period she's setup 22 appointments.  At an average time of 25 minutes for being on the phone and data entry in the last 12 days she's saved me over 9 hours of work.  Yes I've had to pay for it, but quick math...call it 10 hours in two weeks.  20 hours a month.  240 hours a year.  That would be the equivalent of me working for SIX straight full time weeks just answering the phone and setting up estimates.  She's been great at it, super willing to adjust to things I notice and recommend she tweak, and I get my time back and we're still converting leads to estimates to jobs at a great rate.  Also all of this at a fraction of the cost of hiring an answering service.  We're even going to offload even more tasks on her too going forward so I'm excited to do that and see what else I can get done going forward.

Need to schedule biz building time.

One thing I want to do is block out my schedule each week to do business building activities whenever I can.  Just having clear tasks and dedicating time to them that will help us dig out of our backlog of work and do so with quality workers will be amazing.

Folders

A small thing that I love that we did last month was creating folders that are super professional that I can gather all of the documentation from the consultations into so that they're not loose and flying around in the wind.  I love how they turned out and I think make a huge difference in how we're perceived.

I'm excited to report in next month for you!

Q1 2018 recap of Painting Business

So it's been an interesting year so far.  I started the year with no intention of quitting my full time job as a web developer at all.  A couple days into the new year I received word that the production manager that we had hired in the painting business was going to retire.  We didn't have much of a game plan for that type of development, but we did have my mom who had done that role in its entirety before and so we likely figured we'd just have her juggle that while we found another person to take our retiree's place.

A few days after this happened I had the thought come into my head as I was driving in to work at my full time job that perhaps I could take over the job, pay, and duties, and then that would allow me to still bring in money for my family, I could quit my full time job, and then also help the business grow.  As soon as I got into work I messaged my wife my thoughts and she loved it.  To her everlasting credit she has been behind having me quit and work full time on the business for years now.

I then talked to my mom about this potential idea and she really liked it.  She discussed it with Scott and he was also on board.  We had a few more conversations about transition, timeline, upcoming jobs and when I'd take over managing them from start to finish.  Then there was also the discussion of an upcoming painting conference we'd booked a flight for my mom to go to in late January that we had to work through.

After figuring out when would be best for me to go and take over in the production manager role it then came down to figuring out how do I go about quitting my job.  This was interesting to noodle over in my opinion since secretly my dream had always been to have enough savings, a business already up and running, and somehow get laid off from my job so that I could collect unemployment.  After a bit of conversations and thinking it came down to me just quitting my job.  As nice as it would've been to collect unemployment I have no idea how long it would've taken for me to actually get fired or laid off and so the most logical thing would be to just quit.

So I put in my notice.  A couple weeks later I was out of the full time employment game and into you eat what you kill game, i.e. self-employment where I was and am in charge of my results and not someone else telling me what I need to do.

The transition didn't go as planned to be honest.  There was too much already wrapped up in the jobs we'd already had going and ones upcoming that that just didn't really happen like we planned.  I did end up going to the painting conference though in late January, which I'm really glad that I did.  I learned a lot, made great contacts, and it changed the course of how to proceed in the painting business.

While I was there they had "hot seats" where each painting business owner would get up and talk about one or two good things they did in the past year and would ask for help/input on one or two things they needed help on.  In my session I said our online presence really helped us and doing cabinets.  Our problem, which was being over on budget, had been discussed a lot through keynote speakers so I wasn't entirely sure what to ask about to be honest.  The moderator asked our partnership split and duties and who was doing what and it made his head spin.  He asked me to stop talking mid sentence and just blurted out, "You need to do your own thing".  As soon as he said that about a half dozen heads in the room nodded in agreement and a few people vocalized their agreement with his assessment.

TBH that was not the thing I wanted to hear.  Going through my head was...

I don't know how to paint.
I don't know how to estimate.
Where would I get leads?
How would I pay for stuff?
How would I get licensed?
I just freaking quit my job so wth???

Those were just a few of the things that went through my head.  I then went on to explain that though convoluted and not ideal it was a thing that if I started new activities in the business and if I took full charge of them that the partners and I had agreed that I, or any of the partners for that matter, could take profits from said jobs.  So while somewhat defeated I was actually resolved to go home and make it work in the current layout of the existing painting business.

I flew home on Delta, which has upped their game by the way in terms of what they serve and the in-flight entertainment just fyi.

I called my mom to discuss things about the conference and how things were going in the business that past week.  Things with customers and employees were fine, but she and Scott were having issues resolving how to do certain things in the painting business and apparently it wasn't the prettiest how it was playing out.  But we had always worked through things in the past so I continued to hear her out.  After further explanation it was like that seed in the back of my mind of starting my own thing was blooming into a real thought that maybe now was really the time to make it happen.

So I paused my mom, like the moderator had done to me, and explained to her what I'd experienced while sitting on the hot seat.  She listened and then I explained why this might be the ideal thing at this juncture.  Instead of slogging through a business that would face occasional push back from our other partner maybe it would be best to start anew either with him out of the existing business or if that wasn't agreeable to him then we'd start our own.  We talked a bit more about that idea and how we should approach him about it.  Have him retire and keep his percentage, buy him out completely, or some variation of the two or just start our own.  One thing we did say for certain was that based on the impasse of the previous week that we were going to say that we'd decided to do this thing and that it was final and that we wanted to work through what he thought about it.

We went to dinner, ate our meal, and talked about Ashlee's pregnancy.  After I finished dessert I explained that the painting conference was good, but what it made me realize is that there is a lot of stuff still yet to do and that before we started doing those things we needed to resolve who was going to be involved or not and how to move forward with that in the future.  Scott was certifiably pissed, which we, or I should say I pretty much expected, although that possibility wasn't lost on my mom or Ashlee in the least.  We knew we kind of sprung it on him and we tried our best to talk through as much of it as we could.  He didn't want to be bought out.  He said he couldn't retire.  With that said we knew splitting was our only other option.

We tried talking through that for about 20-30 minutes, and eventually it just all became too overwhelming for Scott and he just left.  The good thing that did come out of it was that we were splitting, he'd keep the existing name, license, insurance, payroll, employees for the most part, customer list, logo, but the biggest thing to me was that I got to take to our new business the thing I valued the most, which was our lead generation and website company.

With that alone we had a business and the rest I knew we could work hard through.

Scott came and picked up some stuff the very next morning and he actually was quite calm and feeling good about the split.  Being able to capture a 100% of the profit from jobs and not have to do things that he didn't want to do that perhaps the other partners did was likely another big win for him.

From here was a mad dash of activity though it seemed to go on forever at the same time.  Rebranding, starting all new everything, getting licensed all takes a lot longer when you do it all in one chunk versus doing it over a year and a half like we'd done with the previous company.

At the painting conference one keynote speaker talked about levels of a business, which there are 4.  Start up, build up, build out, and enterprise.  I decided that one of those levels would be a good name to use for my new painting business.  Can you guess which one?

If you guessed Startup Painters you're wrong.  We went with Enterprise Painters.  I liked that name for a few reasons.  I liked the revenue size, the professionalism and vision/dream and team behind it and margins, and it would translate well regardless of location if we were to have multiple locations around the state and country.

After picking the name we worked through a logo, talked to our web company about the transition, and started working on getting licensed, which involved scheduling of classes, getting our llc setup, ein number, bank account, and what not.

I also spent a bit of time getting Scott ready with his new web guy who was also a painter of his and getting content and hosting moved over to a new account.  I spent days working on rebranding all of our estimating and marketing materials.  Spent a day gathering stuff from the shop that we could use in the new business for our employees.  Spent time interviewing and talking to a few guys about doing door to door activities.  Only one of them panned out and actually went and did door to door the other has fizzled out due to the fact that he already had another full time gig that was paying him well to go and do window estimates.

I ended up being the one to go to the contractor class after learning the amazingly good news that the state changed the requirements last May that the requirement of needing 4,000 hours of experience as a painter to get licensed had been done away with.  We got workers comp waivers done and a million dollar liability insurance policy setup.  We setup new streamlined and integrated payroll, bookkeeping, time sheets, and estimating software that I learned all about at the painting conference and those will make all the difference in the world I think since we'll be much more streamlined and efficient with everything involved there.

We started getting leads from our web guys early to mid February.  To date we've booked $64,849.75 in revenue.  The numbers may be just a tad off, but that is on the back of 39 leads, 32 estimates, and 21 jobs won.  That is a lead to estimate conversion percentage of 82% where industry standard is that you're doing good if you're converting those at 40%.  Our estimate into a job conversion percentage is 66%.  Industry standard is that at a minimum you should be converting at least 25% of your jobs with the high end being 50%.  If you're above that something is off, i.e. your prices are too low or perhaps some other factor isn't being accounted for, but the biggest one being your prices are too low hence why you're winning so many and so if you are winning that many then you're labor and material costs are likely getting decimated and you're not making the margin you should on each job.

Renee and I will be going over our job numbers in the next day or two and so we'll have a better idea on whats going on there here soon.  I do know that I'm learning stuff everyday with estimating and that our conversion percentage should come down since I'll be better at accounting for all of our costs going forward, which then affects those customers that are of course price sensitive and will go with another contractor at that point.

Next month's report that I'll post on the blog maybe I'll post/share what our job numbers came out to be and other noteworthy stuff.  This first post I wanted to be a general recap of what is going on and went on for the first part of the year so that I could get us caught up on that.

We've hired some great people, fixed a lot of stuff, and hope to have a lot more stuff formalized and streamlined to get us to that ultimate goal of being the real Enterprise Painters I hoped for from the beginning.

Other noteworthy things were landing a big commercial ceiling that I talked to a lot of people about and through that and persistent follow up and tenacity we landed that.  That was like $20,000 and my very first huge job to have won and bid like that, which seems like a miracle.

Another thing was that Renee did awesome by talking to her dad about borrowing his truck to help us fulfill our first couple jobs.  He gladly let us borrow it, but then when we went to return it because we'd bought a work van to transfer everything over to he cut us a check for the full amount of the van, which was amazing.

We've learned some great things on how to do liens to protect our paint and job costs, test runs of new paint lines to get big discounts here and there too, which has been cool.  Lots of moving parts, but it is coming together.

If you're local to Salt Lake City and read this and refer anyone that works with us we pay $50 in the form of a visa gift card or as a donation to your favorite charity.

Until next time.

Brock
EP

2018 goals

The book on millionaires I mentioned in the last post talks about the transformative power of talking about your goals/dreams in the present tense and how they feel in the moment.  There is more to it then I can or want to quickly explain here beyond what I just did, but I just wanted to share what my goals are for the coming year and years using this technique. 

As an aside I got an email from one of the business development programs we've been paying for and he mentions how they followed a class of Harvard graduates.  3% wrote their goals down.  They followed up with everyone 20 years later.  The 3% who had written their goals down had accumulated more assets than the other 97% combined.  Harvard grads!  Moral of the story, if you have any ambition and goals in general, screw the in the general and write those things down.  You're entire life is intertwined and things shape up differently if you do different things and apparently writing goals down is one of those things.  And yes I've asked our painting employees to do this same exact activity.

Goals:

• business/job role goals - I work in a business that provides for my family and meets all my spending and savings goals.  I am fulfilled, excited to work each day, have a great team around me that enjoys being around me and me around them.  In 2018 businesses grow to the point where I quit my full time job so that I can make more money there and have more time freedom.
• At 20% net profit margin the businesses bring in $600,000 in top line revenue.  After 35% taxes and 10% tithing I’ll make $54,000 net on the year.
• That equates to $15,000 in painting jobs done each week for 40 weeks or March 1st through November 30th 2018.  That is 6.5 jobs per week at our average job size of $2,300 that we did in 2017.  At current conversion rates that means 941 leads need to be brought into the business, 621 estimates need to given out and 261 jobs won.
• Health - I jump and dunk the basketball.  I can bench press 200 lbs one time and it is easy to do.  I have abs that show naturally.  I eat healthy planned out meals and sometimes have a cook prepare the food and snacks for me and my family.  We eat organic and have done away with a microwave opting for more natural methods of heating our food.  My wife and I enjoy our bodies and the activities we can do with them ourselves and with our kids and friends.  Going on hikes isn’t a burden.
• Personal life - Ashlee and I regularly attend therapy and our relationship is thriving.  I get to serve whenever the ward has random time of day requests for help.  I’m able to help those in the ward with things they need or want.
• friends/family - I take friends and family out to lunch or dinner and movie on their birthdays and just because randomly throughout the year to catch up with them and I pay for them every time.  I give them special gifts that they’ve never received before.  I take each of my kids out on ‘dates’ to be in touch with them and help them with whatever it is they’re facing at the time and it really enriches our relationships and we’re really close and can and do talk about everything.
• Finances - I live in a really nice house that is completely remodeled and stylish and comfortable and warm and totally insulated.  My utility bills are super cheap because of the insulation and windows we have put in.  The house is also all the way paid for.  I’ve got several rental properties that provide all the cash flow Ashlee and I will ever need.  Our businesses do the same, but are always on a tear with the best margins in their respective industry, most giving in their industry in terms of charity, and growing year over year.  All of this is because it frees up my mind to focus on more important things and take away the stress of worrying about anything that could happen financially has already been solved  Each business is mentored by an amazing mentor who has been there before us and is totally invested in what we can do to give back to others.  Our cars are new models because we want super safe cars that are also really reliable and of course they’re paid for and we have uninsured motorist coverage on our insurance policy.  Burial plans and estate are paid for and set up and tax efficient.  I pay for all my kids weddings, missions, and beginner investments whether that is a rental property or invest in their business.  I do the same for my family and coach them on how to grow their business.
• Personal growth and development - I read several books each month.  Leisure books and non-fiction.  I read biographies of people who i’m interested in.  I now know how to cook really well and we have great cooking tools and equipment.  I serve a “senior mission” even though I’m still super young and everything back home is taken care of in terms of finances and family life.
• Fun (travel, recreation, leisure) - Ashlee and I go ourselves to places we’d love to go and often fly first class because the businesses sky miles pay for it.  We go ourselves and pay family really well to take care of the kids while we go.  When the kids are older we take them with us often so they get to experience new things and we grow closer together as a family.

As an extra nugget of goal setting I did this activity of doing a "Painted Picture" earlier this year or maybe it was even last year after listening to the podcast interviewing the guy who created 1-800-got-junk and he does this with his company and companies and so I did it too and thought it'd be good/cool to share here as well.

Enjoy!

2020 Painted Picture

The best way to ensure the future happens is to create it – first with a vivid image in our minds – and then commitment to this picture as though it’s already happened. Our Painted Picture paints a clear and compelling future for Rocky Mountain Painters – it’s how we will look, feel and act on January 1st, 2020.

Our Purpose

We want to build a high quality high value service for each of our clients.  We treat our customers like friends, we do what we say we will do, and we work together to make every day better. And it’s together that we have created a painting company that has proudly grown from start-up to well-respected industry leader in just five short years.  

Our family has grown from serving Salt Lake City, to all cities in the greater salt lake area.  Revenues are 2 million per year and our fun brand helps other companies put their best foot forward for all their customers.  

We show up on the first page of google organically.

Our People

Our people are everything.  They not only do a great job and keep our customer’s businesses looking great, but they stay with us.  They move up the ranks and are trying to help grow the business as well.

Our Customers

Our customers are our main lead source, i.e. more than 50%.  We love to stay in touch with them and help them anyway we can and in return by helping them and staying top of mind we are receiving more and more work from similar people that are their friends.

Our Brand

Not only have we started to reinvent an industry, but also, we’re reinventing how the industry markets. On a mission to create a top-of-mind name, our marketing never lets up. And it works – people tell us, “I love your brand!” Our remarkable marketing style and happy attitude have generated an unprecedented buzz in the painting industry, completely changing the picture in people’s minds of the stereotypical painting company.

Painting companies don’t get press, but we do, and lots of it.  Because of our backlinks and press releases people reach out to us consistently to have us help them with their painting needs.

We partner strategically with commercial sales, leasing, and management companies to ensure we stay top of mind as the preferred service provider for all their painting needs for their occupied, and more importantly unoccupied spaces.

Our Profits

We are happy to have the highest profit margin in our industry to due to innovative marketing and system processes.

Our Shared Success

More than money we love to give back to the community.  We enjoy regular outings together to celebrate milestones within the company.