finally hiring my 1st employee

[huggytree]

8 years in business(all by myseld)

Today I decided to give the final ok today to the union to get my 1st apprentice....its sooo hard.....my sales are up 20% this year and I see the trend continuing

he will cost me $40,000 total w/ benefits and SS.....so if I don't make $40k more in profit this year its $-40k off my salary (very scary)

I asked for a ex military guy and he was near the top of the list, so I figured id better jump or risk not getting ex military

I wanted ex military because #1- I want to support them and #2 im anal and hope he can handle my personality........im very organized and hard working...im hoping the military also put those 2 things into his head

now I will likely have some more free time for sales.....

question: how much should I let him know about my pricing?....he's going to hear me on the phone all day long discussing costs/pricing....its not going to be a secret....he will get tons of insider stuff that I would have only dreamed of when I worked for someone else........should I allow him to work on my bids too?.....im basically training him to run his own business and use all my secrets........I don't see any way around it as long as im in the field

I assume he will be giving his 2 weeks notice, so ill have him at the end of the month.....I have 0 work on the schedule for 2 weeks+ out....very scary to hire someone when work is coming in day to day (but it does)

[Harold Mansfield]

Congratulations!

I don't have any employees, so I'm spit balling based on my days as a bar manager..but he can't be successful unless you give him all of the tools to do so.
I wouldn't let him do the books, but he has to know pricing and know it well or you'll lose money.

Probably wouldn't let him work on bids until you are sure he detailed oriented enough, and can spot potential problems and time creeps not to under bid. There's nothing worse than missing something on a bid and costing yourself an extra 10 hours work.

I work with service partners sometimes, where they do their thing and I do the website and technical work. They can't do my bids because they have no technical knowledge. But your situation is different...he's actually doing the work. So I'm sure he'll be creating bids in no time.

[huggytree]

my issue is he will know what im making off him.....my world changed the first time I saw my old bosses invoices laying on the countertop on jobs...sometimes he was making $400 an hour off me

all while complaining he made nothing and fought me over a .25 cent raise once

envy is very powerful....I DO make very good money.....and I try to hide it from most people....I have no choice but to talk pricing in front of him.....I never knew what any of my old bosses charged per hour.......this guys going to know on day 1

I think im setting myself up to help him start his own business and be a direct competitor some day......I wish I knew 1/10th when i started out of what he will know about my business on week 1.....I will have no business secrets from him....he will know every detail because he's sitting next to me listening

unless I don't answer my phone all day...which isn't possible

I will try to walk away from him, but that means he's sitting there doing nothing at first while I walk around the block


would any of you like to hire an employee without even knowing who he is? he may be a she(im having fun with the wife over this...thinking of me with a 20 something woman in my van all day...as if any plumber woman would actually look like a woman)....the union considers everyone the same, so to them it doesn't matter who I get.....

I wont know anything about him until he knocks on my door in 2 weeks

I have a non-compete agreement all ready for him(got that done this week)

[Wozcreative]

I think that's with every business. You have overhead after all! If he knew how to start his own business he would.. but he is working for you and you are taking care of everything while he's the donkey.

In the design agency world, designers are often paid $20/h but the agency charges anywhere from $90 - $250/h.

Hmm maybe there's a business with female plumbers... As a female who lives at home alone.. I'd hire a female to do the job! I think there's business in that. Just train your daughters—hows that for an employee? lol

[Brian Altenhofel]

my issue is he will know what im making off him.....my world changed the first time I saw my old bosses invoices laying on the countertop on jobs...sometimes he was making $400 an hour off me

all while complaining he made nothing and fought me over a .25 cent raise once

envy is very powerful....I DO make very good money.....and I try to hide it from most people....I have no choice but to talk pricing in front of him.....I never knew what any of my old bosses charged per hour.......this guys going to know on day 1

If he's the type of employee that just looks at everything as another "job", he'll probably piss and moan about it. Some employee types understand (or at least come to understand) that there is more cost involved than just their salary.


I think im setting myself up to help him start his own business and be a direct competitor some day

There's two types of people in this world. Employers and employees. (Well, there's a third, but that's another topic.) If he's got the stuff to go out on his own, then he'll do it eventually. If he doesn't have the stuff but doesn't recognize that, he'll go out on his own and not be a problem. If he doesn't have the stuff and recognizes he doesn't have the stuff, he's probably content being an employee. There are a lot of people who are content with a steady predictable paycheck. People who tend to go into business for themselves aren't that type.


would any of you like to hire an employee without even knowing who he is? he may be a she(im having fun with the wife over this...thinking of me with a 20 something woman in my van all day...as if any plumber woman would actually look like a woman)....the union considers everyone the same, so to them it doesn't matter who I get.....

I get hired as a contractor and I've hired contractors without ever meeting face to face or even talking on the phone. Of course, it is a little different because I do get a name and typically a business entity that I can use to figure out who the person is exactly and do a basic background check.


I have a non-compete agreement all ready for him(got that done this week)

While a non-compete agreement can be good, there's a lot that goes into actually enforcing it. One small issue out of whack and it becomes swiss cheese.

[huggytree]

I have known 3 female plumbers.....I think the union has around 10 total.....2 looked just like men....the 3rd was all woman(her dad was a plumber)...she would call in sick on the heavy lifting days because she couldn't do it

I had a lawyer write up the non-compete for me...I think they charged me only $200 since they are currently working with me on my website lawsuit anyways....if may or may not be any good, but in the eyes of 99% of employees its scary enough to not try to steal customers.......its kind of like putting Liens on a house.....just the threat scares 99% of homeowners into getting me my money...I use it a few times a year....the truth is you can have your house liened and it really means nothing...in 2 years the lien goes away on its own....

[billbenson]

Well, most people would like to be in business for themselves. Also, most people don't have what it takes to do that. Fear of going without a salary for a while is a big factor as well. That's why straight commission sales people usually make more money that salary plus commission.

I'd do a full background check on the guy. It's not expensive these days. If his skills aren't up to yours, train him. If they are, see how he interacts with customers. I'd keep a pretty close eye initially.

Although I know you are proud of your plumbing skills, you have good business and marketing skills as well or you would have failed years ago. Think of one employee as a step to two employees. You will always have churn. Make sure it doesn't matter if he leaves!

[tallen]

Most auto service centers and boat yards I have dealt with have their hourly rates clearly published, so the employees know what is being charged for their work versus what they are being paid. But perhaps because of the significant capital plant involved, the employees understand that there is overhead, and thus recognize that the business has to charge the customers more (maybe a lot more) than what they are actually being paid. Of course these employees are unlikely to go out and open up their own garage or boat yard because of the capital investment required.

So if you are worried about your employee getting ants-in-his-pants when he figures out the difference between what you're charging and what you are paying him (or her), one approach might be to bring them into the business even more by somehow showing that you have overhead costs that need to be covered, too (marketing, insurance, worker's comp., payroll taxes, depreciation, billable vs. non-billable hours, etc....) In other words, treat them more and more like a partner over time rather than just as a "lowly" employee. I don't necessarily mean profit sharing or all that, just that you want to get them to be committed to the success of the business (your business), and for them to take pride in working towards that success (pride in working for you).

[huggytree]

its not just the hourly rate....I bid on jobs for the # of hours a average plumber would take to complete them....if I get it done early its extra $$ in my pocket

he 'may' notice some high profits once in a while.....envy is very powerful.....we all suffer from it.....I had envy for every boss.....they sat behind a desk and did almost nothing while I worked hard and made peanuts compared to them (at least this is how I felt...whether it was accurate or not)

[Patrysha]

Isn't that the way most contracting business owners do things? I know that's how my father in law did his bids as do my landscaping clients...they bid based on how long it will take...occasionally things will go over for whatever reason, but most days they are pocketing a bit extra because they keep time under control. Or sometimes because the materials cost less than what they bid the job at because they've hit a sale.

I think maybe you overestimate the average employee though...most aren't even paying attention to what the boss makes or does as long as he or she gets paid at the end of the day.

And when they do, they usually don't get mad at the bosses, I mean even back when I was working retail, you didn't get mad at the bosses at head office when you sold $10,000 worth of clothing in a day and only took home your salary and tiny commission on it.

[huggytree]

I have worked with many journeymen.....believe me im not over estimating the average guy...most likely the other way around......id never hire an average guy though.....I team up with a friend once in a while and he's 1/2 to 1/3rd my speed....I hustle like crazy...because the quicker im done the more $$ I make...

most of my profits are because of getting the jobs done under bid time

[Harold Mansfield]

my issue is he will know what im making off him.....my world changed the first time I saw my old bosses invoices laying on the countertop on jobs...sometimes he was making $400 an hour off me

all while complaining he made nothing and fought me over a .25 cent raise once

envy is very powerful....I DO make very good money.....and I try to hide it from most people....I have no choice but to talk pricing in front of him.....I never knew what any of my old bosses charged per hour.......this guys going to know on day 1


It doesn't take much for an employee to figure out the money.
Every bar, club or restaurant I've ever worked at I could get a pretty good idea of how much was brought in every week, knew how much the managers made, what the gaming drop was, liquor sales, food, cover charge and so on and so on.

Of course I never had a clear image of overhead costs.

I think any employee who is taking money/payments can figure it out if they really want to.

Besides, what the boss makes is really none of my concern. It's his business. I expect him to make money. When I got tired of making money for other people, I opened my own business.

However, everyone doesn't want to be an entrepreneur. Most people just want to go to work in a structured enviroment and pick up their paycheck every week without all of the stress, headaches, paperwork, logistics, marketing, taxes, risk and uncertainty.

[Wozcreative]

It doesn't take much for an employee to figure out the money.
Every bar, club or restaurant I've ever worked at I could get a pretty good idea of how much was brought in every week, knew how much the managers made, what the gaming drop was, liquor sales, food, cover charge and so on and so on.

Of course I never had a clear image of overhead costs.

I think any employee who is taking money/payments can figure it out if they really want to.

Besides, what the boss makes is really none of my concern. It's his business. I expect him to make money. When I got tired of making money for other people, I opened my own business.

However, everyone doesn't want to be an entrepreneur. Most people just want to go to work in a structured enviroment and pick up their paycheck every week without all of the stress, headaches, paperwork, logistics, marketing, taxes, risk and uncertainty.

Very true, most people want a stable working environment. They want to know that they are always going to be getting paid and that they don't have to have the know how to get new customers. To start a business means you are working 24/7... most people like to take a break after 5PM and do whatever the hell they want.. us business people have to "schedule in" fun time.

[huggytree]

almost every plumber is a side jobber......so they all get a taste of running their own business.....since the economy collapse in construction there aren't many large companies any more...all the plumbers are like me...1 man shops....100's of them now, where 10 years ago there was probably 75 total or less...now 200+

I think a higher % than normal try their hand at running a business as a sub contractor...its fairly easy(not easy to succeed though)

[huggytree]

I canceled my apprentice yesterday....I did the math and realized there was a huge benefit jump for the 2nd year apprentice....it would have cost me $40 per hour for a 2nd year...1st year is around $25......I decided why spend $80k a year for a 2nd year when $105k a year gets you the journeyman......I doesn't make any financial sense for me to give this much away when I don't have enough work right now..

I am hiring a shop boy/helper for $15 an hour part time.....30 hours a week (which is perfect)...no benefits...he'll cost me $20 an hour or less

he wont be allowed to assemble any plumbing....he's technically not even supposed to touch piping......he will spend all day doing demo and running for parts/tools to my van...some days he will do almost nothing...other days he will save me 2-3 hours a day...maybe even 6 on the days I dig sewers

I posted on craigs list and got a list of 20 guys interested in 2 days...im interviewing 5 of them next week........when I get more work than I can handle ill get the journeyman....

the apprentice costs $10 per hour for pension , $8.20 for health insurance and $1 for some misc funds.....he's only making $14.50 per hour...his benefits are 135% of his wages...I think that's insane for someone who doesn't even know how to swing a hammer or use a tape measure.....glad I spent a few days thinking about it and adding it all up

[billbenson]

It sounds like because you are in a union state it has made your current business model profitable. It seems that if you grow your business you become less profitable. You need to figure out a way (which you may just have) to be profitable as you grow in a union state.

I can tell you this. FL is a non union state. I would never pay a plumber what you charge. But you are there and I'm here. There are different rules. You need to figure out how you can maximize your income with WI rules.

[Steve B]

It sounds like you made a smart switch to me. Are you allowed to use this type of employee to help you around your own house doing odd jobs? If so, he can make a huge impact for you if he, for example, cuts your grass for 4 hours a month at $20 per hour - allowing you more time to do plumbing at $150 per hour.

[huggytree]

you are not allowed to have a plumbers helper.....he cannot touch pipe

he can bring my tools, bust up concrete, drill holes, cut 2x4s for backing, demo stuff, dig. help carry water heaters/heavy stuff....he isn't supposed to do some of the things I want though...like demo old/existing piping.....I will push the rules and if caught could have trouble.....I will never have him put piping together....wont cross that line....but cut pipe, demo pipe yes....I will most likely teach him to install toilets/faucets too....

my back has issues and isn't able to heal....last week it hurt to even walk or breath deeply....my back can partially heal (the doctor claims it), but I keep hurting it over and over....I want to give up all the hard physical work....I will start working out at home again to keep in shape.....

lately im working 8-10 hours in the field and then 2 hours at home on bids....my family life is suffering during the week...I want it back to 6 hours in the field and 2 hours bidding....my hope is this guy to save me 25% time w/ labor...

I was crawling around in a diry/gravel filled crawlspace yesterday...got filthy....how nice it would have been to have a helper

I still don't know how I will ever bridge the hours gap to hire a journeyman.....unless I suddenly pickup a large builder and get tons of weekly hours all the sudden.....the only way I see it is to eventually hire someone and then I sit at home most of the day.....for a few years until I build back up the hours from more and more new customers...

I will eventually get there....10% a year growth for 6 out of the last 7 years....and this year its at 20% so far (mostly due to my website)

im starting to think about if I want to grow much more or not....im really struggling to find MORE new high quality builders.....there just aren't many out there still in business and many of the high end guys still use the cheapest labor they can find...they just keep the extra profit for them selves instead of hiring quality sub contractors

[huggytree]

I got 20 job inquires.....shocking how bad some of them are....some just say ''call me'

me and the wife looked through all the ones worth printing (around 12) last night....2 stood out and a 3rd stood out to me(wife says he's too odd)

got all 3 interviews tomorrow morning....just from the phone call I can tell 1 reacts slowly and fumbles around......the Odd one is my favorite...he's coming at 8am on a Saturday...says he gets up at 5am...he has his own design/web business, but is very slow....he wants to work both jobs....seems perfect since this way I don't have to guarantee 30 hours...im flexible if he needs a day off here or there......he's ex military and also has worked as a plumbers helper for a relative...his resume is very odd.....he talked fast and direct (hyper just like me)

$15 per hour should get me pretty good quality....I expect someone to almost RUN to my van to grab me parts....a hyper guy would be perfect.....but I also need someone who can relax when needed to do demo and not bang up a customers house.......the main job will be getting parts and carrying tools.....I take 4-15 trips to my van for most jobs....I think I spend tons of time walking back and forth....im hoping to be able to stay in 1 place and work continuous.....Im thinking up ways to really save time on standard jobs like water heater replacements.....I think I can get them down to 45 mins....now I take 1.5 hours typically

[huggytree]

wages are like $33+ per hour........non union states are $15 an hour.....nationally a plumber charges $100+ from every article ive read

no way id do this work for $15 an hour....I beat my body up daily...never a day without a cut or bruise....

WI isn't a union state.....Milwaukee is one of the union Hot beds for plumbers.....Madison which is practically communist is not good the the plumbers union.....a lot of it depends on how well the union was run over the years...Madison drove theirs into the ground......due to the economy non union plumbers are taking over new homes....im in a Niche.....middle/high end remodels....I can work on that 100 year old home while a rookie would struggle.....

im not very pro union....but the building trades are not like a typical union...they don't protect their workers if they are bad.....they are typical in the philosophy that every worker is exactly the same which is hard for me to believe anyone could think that way....except for Carl Marx