Changing your business structure

[The Dark Knight]

Not really property investment related but since most people on here seem to have their own business just wanted some helpful feedback or constructive critism. I work fulltime and also started a carpet cleaning business as some extra money to put towards my property portfolio. Its been a little to successful and I've been working 7 days a week for a long time now and 12 hour days. Ive done a lot of calculations its at a unhappy medium if I employ someone to do it i would get maybe a $100 after tax and paying expenses. If I keep going I'm going to die before I can enjoy all the money I've made through all my investment endeavours. Ive considered changing the business structure to hiring the steam cleaning machines for 24hrs. I know Coles and other supermarkets do it but this would be delivered to your house, we show you how to use it on the spot+ have written tutorials on how to clean carpet and upholstery etc, the machines are more powerful and effective than the supermarkets and don't require the shampoo thus making it a cheaper alternative. Cons are obviously damaging the machine although they can take quite a beating, insurance would be much higher, I would need a security deposit, customers would have to do something. Hit me up with your thoughts please

 

[Macca]

My first thought is to just tell people you are booked more than you actually are so that you limit the hours you are working to a comfortable level.

If you were to try renting out the machine I would think the delivery of the machine, setting it up, packing it up, travel time back home then cleaning between jobs would make it not worthwhile.

Being a private business, people will expect you to be available via phone to give advice if they have a problem, they don't expect that at Coles or WW but they do if privately owned.

I can get 3-4 rooms done for $130 so to do it myself I would only pay half that, so $65 to supply machine, deliver it, explain it, go back twice to get it as the people forgot to put it out. Clean it up, get the oil out from where they tried to clean the carpet after fixing the motor bike in the lounge room. Explain to the next booking that you can't supply the machine because the last people locked the garage.

I would either limit my bookings, find someone to do it on a profit share or sell the business as a going concern.

 

[willair]

I know Coles and other supermarkets do it but this would be delivered to your house, we show you how to use it on the spot+ have written tutorials on how to clean carpet and upholstery etc, the machines are more powerful and effective than the supermarkets and don't require the shampoo thus making it a cheaper alternative. Cons are obviously damaging the machine although they can take quite a beating, insurance would be much higher, I would need a security deposit, customers would have to do something. Hit me up with your thoughts please

Would depends on how many people you have to employ to make it work,area location travel times,from job too job ,then pick up times
maintenance on the machines and the number of machines and transport ,from I see at the auctions a few of these Mercedes van carpet cleaning non franchised businesses models set ups come up often,so that tell you something,myself I would sell it sounds like a very stressfull trying to get some ones carpet clean with the mindsets of people these days..imho..

 

[Ace in the Hole]

My advice is don't compete with the masses, it's killing you as you have already admitted.
There is absolutely nothing wrong with hard work and long hours, but you got to focus it in the right direction.
Find another industry where the rewards are better and dominate it !!!
Become a better salesperson and reap the rewards.

 

[The Dark Knight]

Thanks for the replies guys. The rewards are good it just doesn't work with an employee. Once you take tax. Super, company car into account. We've always got 3 weeks worth of bookings in advance. Indont know ill keep looking into it. Most of our jobs are from people who tried to use the hire machines and couldn't get them to work so either those machines are crap or people just can't get their head around them.

 

[Scott No Mates]

TDK, what award are you looking at to cover an employee? Are they a casual employee with a minimum no. of hours? What are the on-costs ie workers comp, super etc.?

Your other costs won't change too much - public liability, fuel, travel time, cleaning/servicing etc.

You say that you can make $100/day with the employee, does that mean that you are free to drum up more business or do other jobs/double capacity?

 

[Xenia IM]

If you have access to a niche market that can benefit from advice on how to use the machines then I would add it as an extra service not replace the full carpet cleaning service that you are already offering.

Have you tested whether the people who cannot use the machines would pay for a service where they are coached into using them? That's my understanding on what you are saying?

A lot of our property management clients are failed DIY people they turn to an agent when they have completely stuffed everything up, I had gone down the track of testing whether offering a DIY service via coaching would work and it DOES NOT for this market, once they have tried it and stuffed it they would rather go for a full service and hand over to someone who can just do it - for property management most of these clients just want to walk away and have nothing to do with it. It may or may not be similar in other markets.

Test it first to see that there is a market there before you add anything or change business models.

As for expanding the business and outsourcing to others, subcontracting or taking on an apprentice on government scheme may work better than straight out employment.