I was talking this week with fellow one-man band master decorator, Jonathan Graham, about the challenges of taking on bigger than normal jobs. For most UK painters, normal means redecorating a lounge or bedroom, which to be honest, is like falling off a log. From quoting, to ordering materials, to doing the work, to getting paid, it can be all done and dusted, sometimes in just a few days, without any headaches, all self-funded if necessary. Next, please.
But if you have the opportunity of a whole house, or a long run of work, is it good for business? After all, us little guys want the phone to be ringing off the hook, to be busy for months in advance, and earn good money, especially if we can offer a better service than the “competition”.
The answer is – big jobs can be good for business, but only if you do it right!
Out of the conversation came a few interesting and salient business-related points that decorators might want to mull over.
Big jobs should ensure regular profits
Just to clarify, the lure of lots of work isn’t about making loads of money for the sake of it. There is a more sensible reason! The bottom line in business is to make a profit. And if you know you can make a profit every month for x months in advance, then you can plan to improve your business. It is how the Germans do it for goodness sake! Enable companies through tax breaks and funding to plan and invest in kit and systems that will make them even more profitable, more competitive, more likely to do well into the future – more likely to pay hefty wedges of income tax!
So big jobs can be good, but before jumping at any and every offer of a good run of work, consider the following.
Big jobs can equal big financial headaches
Get a call for a whole house and, rightly, you should be all over it. But don’t let the big numbers disguise some potential big pitfalls. A £20,000 job is 10 x bigger than a £2000 job, but with scale you can get disproportionate headaches.
Can you finance the materials for the job? On £20k it is going to be at least £3000.
If necessary, can you afford to hire in help and pay their wages?
Have you allowed for increasing your public liability policy to Public plus Employers Liability?
Is the Health and Safety aspect under control?
Funding a big job
Regardless of scale of job, I highly recommend / urge that as a minimum, you ask for weekly payments for your labour and materials, on the condition that if the money isn’t there on Mondays, you don’t continue till the invoice has been settled. All clear and simple before work starts.
I never worry about asking for money, my supermarket check-out executive does it many times a day without a grinding apologetic feeling in their stomach! Any hesitations from the client at this moneytalk stage, take it very very seriously, and if you choose to ignore the alarm bells, you have been warned!
Anyway, following that strategy, I have never found a job, no matter how big, to have been beyond me financially.
(I know many businesses ask clients for money up front. Again, no problem if that is your strategy, but stick to it, so you know where you stand at the start, and most importantly, where you are going to stand as the job progresses and you are financially committed.)
Obviously, a deal works both ways, so in return for being paid, you need to be committed to that big job, turn up same time every day, work your butt off and keep hitting deadlines.
Private or sub-contract
The above strategy works if you deal direct with private clients, but what if your client is a builder or a government entity or a big business and they say they work on 30, 60, 90 days credit?
A simple question to focus the mind. Would you lend the MD of a big company £8000 so they can pay their bills while you and a mate work a month without any income? If you are comfortable with that trade off, knock yourself out! I have one experience in that arena, and it was enough to make me revert to plan A ever after.
If the job is on a deadline, and it requires more hours than you can physically input on your own within the schedule allowed, the job has to be loaded with extra labour. That is a game changer for one-man bands. Basically you have to manage other decorators (who you may or may not know) and pay them. Ask most business people the biggest headache in business, and they will probably say finding good workers. Which is sort of sad really, seeing as labour is the foremost factor of production in the labour-intensive world of painting and decorating. So if you know a good bunch, realise their value -don’t under value them, and make sure you have the money there on pay day.
Big jobs also require you to deal with more complex schedules than normal, more deliveries and so on. And you have to paint. In the early stages, at least, of upscaling, you can’t just become a foreman and leave the hired lads and ladettes to get on with it. The client hired you not them. It is your level of workmanship that got you the job in the first place, so YOU have to be stamped all over the job.
Another consideration about standards, when upscaling, is this. Realistically, if a big job becomes deadline driven and you cannot do it alone, the quality or the profit margin is under pressure, and you have to really dig deep if the job is not to be compromised. ie more bodies tends to mean more inefficiencies, more snagging which implies higher costs. It can be done, but it is tough to keep on top of scale, and you cannot assume you will come out ahead just because there seems to be a lot of time and a considerable sum of money in the pot.
With more labour, you also need more kit, plus as I said, insurance. This all costs time and money, and the money to make the job work shouldn’t be coming out of your pocket, unless you know it is coming back in!
And finally, here is a really interesting anecdote Jonathan told me about the pros and cons of allying yourself to a client offering a long run of work.
How guaranteed is a guaranteed run of work?
A one-man band was debating signing up for a contract with a company who had promised endless work. The money was rather fine, but with one condition, that he didn’t take on any small private jobs of his own. ie they wanted him available exclusively for their work. A great opportunity on the surface for the decorator, with long-term income and ability to plan, reinvest etc. But the big questions were, (putting tax and national insurance issues aside), how likely was the company to keep those contracts in the long term, and what do you do about your regular clients?
Security, what security?
On balance, the guaranteed security was not as secure as at first glance! From what I understand, this company dangling the carrot were in a line of work that involved tendering for NHS contracts. There was some part of that contract where the work had to be top drawer, hence the need for this good dec’s services, but basic research showed how readily those NHS contracts changed hands, as ANothers consistently undercut each other to get in to that line of work.
So, if after several months of committed work, the single client suddenly lost the contract in a bidding war, the repercussions for a freelance painter were obvious – bye bye, off you go, sorry about lack of notice. Bad enough to be fired off at short notice, but a sudden end brings its own problems, because if you took them at their word, you probably wouldn’t have a pool of small jobs lined up to go to, so your short term income will probably go south.
But think about this. Even if it goes well, ie you ally yourself to one client, the work is as regular as promised for months on end, and you kept to your word and declined all small jobs from your regulars – you could potentially be walking into a brickwall and be left with no business of your own when the long run eventually comes to an end! You have to have a Plan B.
How to protect your interests
You could try and get some sort of regular update from the company on the contract length, so with notice you could start lining up more of your own work. In my experience though, the likelihood is you would be the last to know when it was going to end.
The smarter thing to do to protect yourself against being left in the lurch is to make sure that every 6-8 weeks you can be released to deal with your own customers for 2 or 3 weeks at a time. If that doesn’t fly then ask for a fixed term contract for a defined period and inform your regular customers in general that you can pencil them in for sometime after that date.
(I suspect the client would never have agreed to any of that though, because they want their cake and eat it, by hiring good but easy-to-fire freelancers on an exclusive basis, rather than hire on-the-books labour with all the commitments that come with the territory of employment.)
So, apparently, on balance, that particular offer of a long run of lucrative NHS work was declined. The bread and butter clients got to keep their decorator, and their decorator got to keep his regular almost guaranteed income. Not so much a lost opportunity as a big gamble never taken? There will be more offers, and presumably someone else accepted the terms of the big company, hopefully with their eyes wired open!
Just a few crumbs for thought.
And here are some workable forms of marketing a painting business, which are tried and tested and will land you the chance of a big job. Just take care when the offers come in, because there is a reason why the best decorators in the UK are mainly one man bands and like to keep it that way.