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View Poll Results: net income per year, honestly
0-10k 2 2.67%
10-15k 3 4.00%
15-20k 2 2.67%
20-25k 4 5.33%
25-30k 7 9.33%
30-35k 3 4.00%
35-40k 3 4.00%
40-45k 5 6.67%
45-50k 4 5.33%
50k + 42 56.00%
Voters: 75. You may not vote on this poll

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Old 02-16-2008, 01:17 PM   #1
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Default Net Income per year, honestly

What is your net income per year? I'm only talking about your income as the owner. Or quite simply, the amount reaching your wallet per year.

This is a totally anonymous poll, so no one will see your vote.

Please be honest, I'm just trying to get some accurate numbers that could really help in here.

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Old 02-16-2008, 02:36 PM   #2
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After 4 years in business '07 being my best - after grossing approx 40k in sales - after paying off every business expense in the planet and reinvestments into equipment and employees, and repairs to van - I probably made 15k. And that's charging $45/man-hours. I laugh when other guys think they can make money in this business charging only $20-$25/man-hours to homeowners. My business plan for '08 is to severely cut back on exterior work - or at least only take the most cherry of cherry jobs that require the least amount of prep. And focus on high end interior painting with homes that requires skilled contractors that can easily tackle big jobs - homes with vaulted ceilings and beautiful woodwork. I can make the same money doing that in 2 weeks that took 2 months with homeowners that can't understand why 10g's ain't a lot of money to tackle a century old home with lead paint.

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Old 02-16-2008, 02:41 PM   #3
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Plain

If you charge $45/hr and your gross sales are $40,000, does that mean that you billed out a total of 888.88 hours last year? That would only be about 22 weeks worth of work at 40 hours per week. Are these numbers accurate? If so you need to work the other 30 weeks of the year! $15k isnt cutting it for how hard I am sure you have to work! I hope I am missing something here.
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Old 02-16-2008, 02:51 PM   #4
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Was doing some research and found that the average contractor salary in the US is 79k per year gross. I would assume that puts you around 50-60k. Seems like some of you guys are right there!
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Old 02-16-2008, 02:56 PM   #5
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Originally Posted by plainpainter View Post
After 4 years in business '07 being my best - after grossing approx 40k in sales - after paying off every business expense in the planet and reinvestments into equipment and employees, and repairs to van - I probably made 15k.
Yeah, I'm very sure you are not alone. In my first 7 or so years, I probably make less than 20k because I didn't know my numbers, or track anything. I was selling quality work, at a good price (or so I thought), but was in reality living from check to check. Robbing Peter to pay Paul, so they say. I would think we have all been there at least once.
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Old 02-16-2008, 03:03 PM   #6
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plain, did you pay employees from that 40k as well? or did I misunderstand?
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Old 02-16-2008, 04:00 PM   #7
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My total gross sales was 40k - not all of that money I had 'help' on. I had help on one home that practically bankrupted me - so I got rid of the help and changed gears in my business - May of '07 was the last exterior repaint I have done. Without a 'marketing' plan - I doubt most guys could truly get more than 6 months of work a year. I had one interior job during the summer that I alloted 3 weeks for - well it took 3 months from start to finish - because everytime I showed up, the G.C. was either kicking me off, or other subs were 'taking' over my workspace. I had to hustle to get some washing jobs, just so I could survive. This year will be more about marketing, and very short term highly profitable jobs. I have a 5 g budget right now - and will be marketing like the ****ens. And I will only do certain types of jobs during certain parts of the year. No longer will I take on an interior repaint for example when I have 50 house washing customers lined up. Interiors will be winter months only projects - and exteriors will only be from Memorial day til labor day - and only if they satisfy my critieria of profitability. That old saying of 'some money is better than no money' is totally false. I see all these painting crews with 20 year olds on ladders - and I know they ain't paying their dues - what happens if someone gets hurt? I've eaten too many jobs - I know now that patience is a virtue and sometimes sitting on your living room couch is more profitable than taking a 'monster' job that has potential to cripple or at least sabotage your finances.
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Old 02-16-2008, 05:09 PM   #8
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Sounds like you have had a bad run of luck, plain painter. I hope this year goes better for you.

I have stayed busy year round with one helper with no advertising at all. I just started using a summer crew, teachers (experienced) and college guys. I pay my dues. I pay WC, taxes, liability insurance and all the rest.
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Old 02-16-2008, 05:26 PM   #9
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When I analyze my financial results for the year, I look at two things. One is income, and the other is increase in net worth.

I don't compute my income solely by what reaches my wallet. I also include the benefits and other things my business pays that I might normally pay myself. For example, if I didn't own the business I would likely be paying for my cell phone. In other words, I look at what the business does for me overall.

If the business is profitable my net worth has increased. I may not actually take a higher salary, but my net worth has increased because there is more cash in the business. This also benefits me.

Income is important, but it's not the only thing I look at. I try to keep my income to what I think is a modest level. But I try like crazy to increase my net worth.

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Old 02-16-2008, 05:35 PM   #10
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i didn't see the option for million billion so i didn't vote
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Old 02-16-2008, 05:40 PM   #11
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Dean - thanks for the encouragement. But for me last year was great, I made great strides in improvement. However I don't understand how guys can keep a helper busy all year with no advertizing? I know that use to be the norm back in the 90's. But all long term companies I know advertize in one way or another. I guess if I dropped my rates I could stay busy - but I have analyzed my numbers too much - and it's just not worth it. I was talking to my plumber this morning - he's been in business for 25 years now, and he is saying that he is living paycheck to paycheck and getting tired. Having crews is a great liability - and I don't trust part-timers or college kids - I'd rather have a crew of fulltime professionals with riggers' licenses - so I know accidents will be a minimum. All that costs - so right now, I am focusing on work I can accomplish with my skillset and maximize profits that way. I can make more money off my own back on high end interior than running around managing a crew of inefficient college kids that think $15/hr is crap money - not to mention the callbacks.....
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Old 02-16-2008, 06:13 PM   #12
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Quote:
Originally Posted by plainpainter View Post
I guess if I dropped my rates I could stay busy - but I have analyzed my numbers too much - and it's just not worth it. is ..
I know this is going to fly in the face of alot of what we talk about here, but I honestly think that if, as your numbers above indicate, you are currently generating less than 900 hours of work per year for yourself at $45/hr, you might consider lowering your rate in the interest of being in circulation more than 40% of the year. I dont know where you live, but in my town, everyone kinda knows who the guys are that dont work much.

I would be interested in hearing your analysis of the numbers which leads you to believe that it is not worth it. If you are basically a one man operation, how can your overhead be so heavy that you cannot work for less than that rate? Perhaps you can find some fat to trim. And if your overhead truly is that heavy, how in the world can you cover it during the 60% of the time you are not working? Do you shut the business down and the overhead disappears?

I think one could convince ones self that its not worth it to figure this problem out, or hoodwink ones self into believing that one does have it figured out, and that could be a cop out. We had one thread that discussed finding the sweet spot for pricing based on the supply and demand of your time. With all due respect, it seems you were not in demand last year.
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Old 02-16-2008, 07:06 PM   #13
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Vermont said: "We had one thread that discussed finding the sweet spot for pricing based on the supply and demand of your time."

With due respect to what Vermont is discussing:

I am not a great painter. It is as simple as that. I do adequate work. I have found my many years painting part-time were not enough to even have a skill set of a good apprentice. I do not say this with any humility. I state this as a matter of fact.

Now--with that said. I made more than 40 K in 2007 working 9 months steady excluding weekends and holidays and few personal days. 4 months of that were working full time by myself.

I got so tired and cranky, I began looking for a partner and found a very good one. My partner is the techician, craftsman, and makes me look like a superstar. He comes from a top end orientation and is used to working in large Mansion, Estate type homes.

But, from the business perspective--I have gathered all the work. The calls have all come to me. My partner seems satisfied with his 1/2 cut of each job. He knows he could go out on his own and make more without me. Yet, so far he has stuck it out with me. Guess I can sand and vacuum OK.

My point is: Sales is the key to making money. I have a couple of threads based on this idea which is really just a take off on Brian and Ken's very professional posts about business matters.

Being a skilled painter is not the same as being a saavy and skilled business person. If you line your ducks up, and granted, there are a lot of ducks to put in a row, and you generate work for 52 weeks a year, you are going to make more than 40K a year--even working by yourself with moderate skills.

Sincerity, honesty, and service my friend. I think now, if my partner leaves, I will go back to painting low end stuff--apartments, rental places, work that doesn't require the real mastery of skills so many claim to have on this forum.

I'll take $750 (material NOT included btw) for a two bedroom, 1 bath apartment--bust it out it two days and go on. Although I don't know if there is a real market for this type work exclusively, there is enough lower end stuff to keep my needs met, I think.

To sum up--want to make more money??--get more leads-close more leads-cherry pick what you want for the good money and quality you want to do. Look for others who, in the future, might be able help you out.

Just a few ducks to ponder upon.

JTP

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Old 02-17-2008, 10:07 AM   #14
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Scott - when I added up all my costs of doing business vs. how many hours I work - it just ain't worth working cheaper. With a higher work rate and fewer jobs - I have less risk or exposure to accidents - less repairs to my trucks and less use on my equipment. A painting company is an expensive operation to run. If I lessen my rates - perhaps I could get more work - but I would have to lessen it alot before I got noticably more work - and before I know it - I am working harder for the exact same pay. I have found other avenues of business that are far more profitable than painting.
But more than anything - marketing is the key to bring higher profitable jobs. I could stay busy at $25/man-hour - but I found I was working my butt off, and never acquiring enough money to get ahead or to keep my equipment up to date. I see so many painters with the most rickety looking ladders on their vans - there is a reason for that - they don't have cash flow to reinvest into their company.
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Old 02-17-2008, 10:14 AM   #15
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Quote:
Originally Posted by JTP View Post
Vermont said: "We had one thread that discussed finding the sweet spot for pricing based on the supply and demand of your time."

With due respect to what Vermont is discussing:

I am not a great painter. It is as simple as that. I do adequate work. I have found my many years painting part-time were not enough to even have a skill set of a good apprentice. I do not say this with any humility. I state this as a matter of fact.

Now--with that said. I made more than 40 K in 2007 working 9 months steady excluding weekends and holidays and few personal days. 4 months of that were working full time by myself.

I got so tired and cranky, I began looking for a partner and found a very good one. My partner is the techician, craftsman, and makes me look like a superstar. He comes from a top end orientation and is used to working in large Mansion, Estate type homes.

But, from the business perspective--I have gathered all the work. The calls have all come to me. My partner seems satisfied with his 1/2 cut of each job. He knows he could go out on his own and make more without me. Yet, so far he has stuck it out with me. Guess I can sand and vacuum OK.

My point is: Sales is the key to making money. I have a couple of threads based on this idea which is really just a take off on Brian and Ken's very professional posts about business matters.

Being a skilled painter is not the same as being a saavy and skilled business person. If you line your ducks up, and granted, there are a lot of ducks to put in a row, and you generate work for 52 weeks a year, you are going to make more than 40K a year--even working by yourself with moderate skills.

Sincerity, honesty, and service my friend. I think now, if my partner leaves, I will go back to painting low end stuff--apartments, rental places, work that doesn't require the real mastery of skills so many claim to have on this forum.

I'll take $750 (material NOT included btw) for a two bedroom, 1 bath apartment--bust it out it two days and go on. Although I don't know if there is a real market for this type work exclusively, there is enough lower end stuff to keep my needs met, I think.

To sum up--want to make more money??--get more leads-close more leads-cherry pick what you want for the good money and quality you want to do. Look for others who, in the future, might be able help you out.

Just a few ducks to ponder upon.

JTP
great post JTP
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Old 02-17-2008, 10:15 AM   #16
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Scott if I wasn't in demand that's only because most homeowners are stupid. As far as quality goes - my exterior repaints last and last and last - the proof is in the pudding. My jobs look brand new at the end of 3 years - all my competitors are peeling badly after 3 years. This kind of education to the customers only comes through advertizing - or the patience to wait 15 years before your 'pool' of referals is so large that it keeps you busy day in and day out. The only time I was so busy - is when my pricing was so low - my actual salary was $8/hr. I've been there and done that - I've painted 6 homes in a row and grossed only 30k in sales including materials for doing so. That took 5 months to do - after paying for my overhead and the helpers - hardly anything was left. The second I raised my pricing - these 'customers' disappeared. And I have been working hard ever since to procure a higher paying customer that values my services - and on a shoe string budget this is extremely hard to do. Last year was my best year - I got the money I asked for and have already racked up a lot of interior work this year - and will be using it all for advertizing.
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Old 02-17-2008, 10:25 AM   #17
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Quote:
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Scott if I wasn't in demand that's only because most homeowners are stupid.
If you are openly expressing an opinion like this here, I wonder how much of it gets communicated to your customers. I doubt you do it explicitly, but negative attitudes can seep out of our pores.

Customers aren't stupid. They may be ignorant of what is required for a quality job. It's our job to educate them.

It does sound like you improving your operations and moving in a positive direction.

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Old 02-17-2008, 10:30 AM   #18
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So many guys making over 50k net per year. You all are obviously doing something right if you are paying employees, paying for supplies, fixing/buying equipment/etc without touching that net amount. My hat is off to you all, sincerely.
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Old 02-17-2008, 10:34 AM   #19
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Quote:
Originally Posted by Brian View Post
When I analyze my financial results for the year, I look at two things. One is income, and the other is increase in net worth.

I don't compute my income solely by what reaches my wallet. I also include the benefits and other things my business pays that I might normally pay myself. For example, if I didn't own the business I would likely be paying for my cell phone. In other words, I look at what the business does for me overall.

If the business is profitable my net worth has increased. I may not actually take a higher salary, but my net worth has increased because there is more cash in the business. This also benefits me.

Income is important, but it's not the only thing I look at. I try to keep my income to what I think is a modest level. But I try like crazy to increase my net worth.

Brian Phillips
good points Brian, I hope everyone is taking net worth out of the equation while voting though to keep in line with the question
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Old 02-17-2008, 10:46 AM   #20
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hey rich I would of like to seen a further brakedown, such as


50- 60

60- 70

and so fourth, just thought i would throw that thought out here

dave

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