Asking the question the question “Do you want to be profitable or long lasting” may sound like a silly one but a lot of companies work super hard and as soon as the economy flutters, they go out of business. When business is good you should be doing 3 things…. buying equipment, pay off equipment or saving money. And when I say save money, I don’t mean for a new boat or the new Tahoe that just came out. Small door install companies are not healthy unless they have $40k or more in a Savings account somewhere. Large door install companies should be dept free with $100k or more in the bank. This is of course just my opinion and that and $.25 still will not pay for coffee. The real point I’m trying to make is that when a fledgling door install company starts out they should focus on growing the company.. Anyone can do well when the going is good, but you build a company based on the downside and with that attitude you’ll never be caught off guard.
I personally learned this the hard way, I ran a small install company with 2 – 3 installers and grossed $367k in 2008 the year before the turndown. I found out first hand that GCs have the right and will exercise that right to cancel your contract(s) and/or no longer use you in leu of a employee during tough financial times in order to protect there bottom line. Now this might seem obvious, but the speed and completeness of the lack and work was amazing. It evaporated within 2 months and in some cases weeks. It was only through the fact that I was watching that my company survived. That and the fact that I had saved $70k. So work hard, build your companies, SAVE MONEY!, and keep an eye on the horizon so your the first one to see it coming.