What gross # per year for O/O to sustain success? | TruckMount Forums #1 Carpet Cleaning Forums

What gross # per year for O/O to sustain success?

Luky

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$100,000 is a crazy easy amount in the first year. $100,000 is nothing however if you have tons of expenses. Crazy how many guys are making so much $$$ yet are so broke after “decades” of doing this.
Bingo..
 

randyg6224

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I just got done reading the book "Profit First". Seems to be a very dependable strategy to transform my business to always be profitable and know where my business is bleeding in real time. Good way to capture income that is going everywhere else but in my pocket! Give it a read or listen on Audible. Highly recommend it.
Read and been doing the profit part now for 5 months. Great book!
 

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$100,000 is a crazy easy amount in the first year. $100,000 is nothing however if you have tons of expenses. Crazy how many guys are making so much $$$ yet are so broke after “decades” of doing this.
Hmmm.

Every market is different. You think 100k is easy in any market yr 1? This isn’t a trick question. Have to step up my game.
 

OxiFreshGuy

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Lol it's easy to know why guys are "broke" after years of it - I've seen an example first hand. Owner with 5 vans, 15 years in business, now claims he is "broke" and going to shut down his business...

Real truth is, he hasn't paid himself in 5 years because it all goes into his retirement account. He pays for his entire lifestyle, his mortgage, Mercedes, gas, insurance, TV, internet, cell phone, eating out, EVERYTHING is paid for THROUGH the business. But yet he doesn't get a "paycheck"

Uses the same excuse to not pay his employees sometimes.

The last 5 years he has done $400 - $500,000 in sales per year. No new truck mounts, all trucks/mounts have been paid off, nothing newer than 5 years old.

Has 3-4 technicians any given year, paying them $30-$40,000 each.

Do the math. He does very clever accounting. Constantly cries he is broke, yet he is living the high life. Oh and the beautiful part is he is old enough to be qualified for Medicare.

So it's true, he doesn't collect a paycheck, but he benefits almost $80,000 per year by his expenses through the business.

He does draw a small salary, $30,000 per year. No idea what his tax breaks are, I'm assuming he pays little to no taxes as every year he tries to operate at a "loss".

As a LLC Subchapter S he takes disbursements from the company as well.

So essentially his total pay is really more around $110,000 - plus he only pays taxes on $30,000 of it.
 

Robert86

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I chose the hard and slow route. 4 years but with a complete restart after 2. I did $32,000 last year after expenses (I think it was $38,000 before), and I am expecting around $45,000 for this year. But I owe less than $6,000 on equipment and if need be I can pay it off from savings. Payments are just to build a business credit. As long as I'm seeing growth and increased profits I consider myself successful.
 

Jim Davisson

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I chose the hard and slow route. 4 years but with a complete restart after 2. I did $32,000 last year after expenses (I think it was $38,000 before), and I am expecting around $45,000 for this year. But I owe less than $6,000 on equipment and if need be I can pay it off from savings. Payments are just to build a business credit. As long as I'm seeing growth and increased profits I consider myself successful.
Doing things on your terms and meeting your goals is success. For some it's an Aerotech and high end customers with big tickets, for others it's a business they run and not a business that runs them. Your definition of success sounds like you redefined your goals and are exceeding them, solid work!
 

Odin

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ahhhh carpet cleaning millionaires
 

Spazznout

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@rob allen

I think you may have asked the wrong question that allows to many variables for an honest discussion on your posed topic.

It would seem the better question would be what net financial benefit do you need to draw from your o/o company to be successful?

I use the word financial benefit because some are better than others at utilizing the tax code to its fullest to maximize their benefit of gross dollars earned.

I use the word Net as pre expense gross numbers are meaningless.
 
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Robert86

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@rob allen

I think you may have asked the wrong question that allows to many variables for an honest discussion on your posed topic.

It would seem the better question would be what net financial benefit do you need to draw from your o/o company to be successful?

I use the word financial benefit because some are better than others at utilizing the tax code to its fullest to maximize their benefit of gross dollars earned.

I use the word Net as pre expense gross numbers are meaningless.
Very true. Someone could gross 100,000 a year easy but net they are only doing $40,000.
 

OxiFreshGuy

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My personal goal is an income of $200,000 per year, whether it's through active or passive means. Obviously more active until I'm 45, then hopefully becoming more passive until I die.

Dreams.
 
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thumper@twow.com

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I wish I we're in all you guys shoes. I live in orange county CA. You can't even by a small condo here for under 1/2 million. Cost of living is rediculus here. We have 3 vans all truckmount we need each van to do 1100.00 per day on 5 day week. Plus at least 50 rugs in the shop. Oh you think thats alot....trust me that pie is cut pretty thin by the time I get my little tiny piece.
 

Spazznout

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I wish I we're in all you guys shoes. I live in orange county CA. You can't even by a small condo here for under 1/2 million. Cost of living is rediculus here. We have 3 vans all truckmount we need each van to do 1100.00 per day on 5 day week. Plus at least 50 rugs in the shop. Oh you think thats alot....trust me that pie is cut pretty thin by the time I get my little tiny piece.
Ouch, I feel for you brother...
I live here in the midwest, Ohio.
We have the same size business (3 crews) and financial goals are similar to yours.
Our net goal is 35-38% with aggressive advertising as we are aiming for crew 4 in a few weeks here.(need to hire two new apprentice techs). This is where our challenge lies. Finding good guys wanting to learn a new trade. We have to offer $14 an hour plus hiring bonuses after 6 months, for people with no experience, just to get a handful of applicants. It is horrible for employers in Ohio right now.
 

OxiFreshGuy

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Honestly I struggle to understand the numbers myself.

A single truck by itself with one technician is capable of $120,000 to $150,000 in a year.

Assuming you're a new business and have a truck payment here is the breakdown

$30,000 for the tech
$18,000 in van payments
$5,000 in gas
4% in supplies and chems (roughly $8,000)
10% advertising per truck ($15,000)
10% wear and tear/repair fund ($15,000)
Insurance ($2,000 per truck)

That's only $93,000 so far.

Assuming you have another $7,000 in other costs you still profited $20-$50,000
off that truck
 

Spazznout

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Honestly I struggle to understand the numbers myself.

A single truck by itself with one technician is capable of $120,000 to $150,000 in a year.

Assuming you're a new business and have a truck payment here is the breakdown

$30,000 for the tech
$18,000 in van payments
$5,000 in gas
4% in supplies and chems (roughly $8,000)
10% advertising per truck ($15,000)
10% wear and tear/repair fund ($15,000)
Insurance ($2,000 per truck)

That's only $93,000 so far.

Assuming you have another $7,000 in other costs you still profited $20-$50,000
off that truck
You seem to understand.
Except for a few variances, like some companies do NOT have a van payment.

Also, Tech pay, waaaay to low. Try $50-60K for a good tech plus vacation, and some benefits.
Aslo good tech will bring in 200K+ per year. You just got to keep them busy 5 days a week for 48-50 weeks a year at $1000+ gross average per day or $5000 per week.

Also, Insurance gets cheaper on a per van basis as you add vans. For instance I pay $4200 per year for 3 vans and a trailer with 5 drivers on the policy. We have full coverage with a replacement rider @$60K for each van to cover van and equipment full replacement if totaled.

Also as you get more vans your office labor goes down as 1 person can generally handle 2 vans worth of incoming and outgoing calls.

Also your marketing dollars will actually decrease on a per van basis as you ad vans.


So your net % per van will also go up as you add more vans.

Make sense.?
 

OxiFreshGuy

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Hence my qualifying sentence of, "As a new business" =)
 

Spazznout

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Hence my qualifying sentence of, "As a new business" =)
As a new business, you kick and fight and scream to put every and any dollar you can in your pocket. Goals are nice in this phase but really only good as motivators.

I was gone from the forum for a while. Where are you from Oxi, how long you been in bizz etc.
My name is Matt. I am from Columbus Ohio. My company does 70% air duct and dryer vent cleaning with the rest in Carpet and a tiny bit of tile and grout. I got into this industry in 2007. I started my business in 2011. If you search my posts here you can see one of my very first posts was a, Is this van worth the asking price. I have chronicled much of my business thinking on my journey over the last 8 years here on the forum so it can hopefully help others.
 
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Ouch, I feel for you brother...
I live here in the midwest, Ohio.
We have the same size business (3 crews) and financial goals are similar to yours.
Our net goal is 35-38% with aggressive advertising as we are aiming for crew 4 in a few weeks here.(need to hire two new apprentice techs). This is where our challenge lies. Finding good guys wanting to learn a new trade. We have to offer $14 an hour plus hiring bonuses after 6 months, for people with no experience, just to get a handful of applicants. It is horrible for employers in Ohio right now.
VERY good income at those numbers.

Horrible for employers due to strong economy and other job opportunities now might be my guess.
 
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Honestly I struggle to understand the numbers myself.

A single truck by itself with one technician is capable of $120,000 to $150,000 in a year.

Assuming you're a new business and have a truck payment here is the breakdown

$30,000 for the tech
$18,000 in van payments
$5,000 in gas
4% in supplies and chems (roughly $8,000)
10% advertising per truck ($15,000)
10% wear and tear/repair fund ($15,000)
Insurance ($2,000 per truck)

That's only $93,000 so far.

Assuming you have another $7,000 in other costs you still profited $20-$50,000
off that truck
One tech on a single truck capable of $120-$150K based on the amount of work one man can reasonably perform? Is that what you are saying?

Also, Im new so some of my biggest doubts have to do with my market size. Care to share if any kind of market size (or other metric) comes to mind with these numbers. Hope that makes sense.