Hiring Employees!!

[Cole]

What is one of the first things you look for in a new employee?

[Rich]

Willingness to work. If you've ever seen the movie "Miracle" - "I'm not looking for the best, I'm looking for the right ones". Well it was something like that anyway.

[Rich]

A follow up question to this - how do you keep the good employees? Wages will only take it so far.. what programs/systems does everyone have to keep the good ones?
Health insurance? Safety awards? etc..

[Cole]

That is a great question, Rich. I carry health ins. for all of my employees, I thought everybody did. :D

[grumpy]

My last job had zero benefits and Iw as happy with that becase I was paid commission.

When I start hiring I will have health insurance and 401k.

[Cole]

Grumpy, what is the commission in the Chicago Area?

[Rich]

I know many homebuilders that don't have health insurance, retirement, or anything else. They give 40 hours a week and that's it.
When my business gets going, after maybe 2 houses, and I can see that there are decent employees to be had, I will have the retirement, group health insurance, etc. etc..
But over and above that standard what do you provide? Quality awards, safety awards, in-office childcare (several years down the road), vacation, christmas party, company bar-b-cues, etc.

[Cole]

Yes we have safety awards which is a great thing, but it seems like the guys really take it to heart if they get chosen and that means alot. Because at the end of the day you have to put all work related issues behind you and go home to your family. Thats all that matters in life anyway. We do have a company golf tournament / bbq, and I havent ever thought about the in-office childcare but I will look into it. As a ceo and a worker I dont have employees, I have friends.

[Rich]

I believe in being fair to everyone. If an employee has problems etc... I'll do everything I can to help them out. But when it comes down to making the hard decision - it's business.

[Cole]

But when it comes down to making the hard decision - it's business.

You got that right.

[grumpy]

Cole it depends what you are selling. Most residential roofing salesmen make 10%. COmmercial roofing from 5-7%.

I was paid 25% of the profit from each job.

[Rich]

:shock: that scares me grumpy :)
25%?? what did your bids contain for O&P if you already had 25% for commission?

[grumpy]

Rich 25% of the PROFIT.

That means if we put in $100 for profit, $25 was mine.

If a job costs us $500 for materials, and $1000 for labor and have $500 for overhead and we marked it up $1000 for profit I got $250, assuming the project came in on budget.

The commission wasn't 25% off the top. I thought we disucssed this previously on Nate's forum. Also you have to understand I was project manager, not salesman/estimator. If something went wrong it all came back to me.

I'd be willing to explain it in greater detail if you'd like.

[Cole]

I'd be willing to explain it in greater detail if you'd like.

Go for it Grumpy.

[grumpy]

LOL. Ok the above numbers from my previous post were just made up numbers.

Let's disect the average sized roofing job of 20 squares 5/12, 2 layer tear off.

You can figure that 20 squares would cost us about $1,300 for labor and labor burdens. You can figure that materials would come in at about $1,000. You can figure that disposal is about $300 for the truck, truck driver, and disposal fees. Now you can figure that our overhead was about $800 per day.

This all means that the job COST us $3400. That breaks out to be $170 a square.

If I sold the job for $170 a square there would be NO profit thus 25% of $0.00 = $0.00 in my pocket.

Let's say I sold the job for $4,000 even. That would mean there is $600 profit. 25% of $600 is $150 in my pocket.

Chances are very high that a job like this would be sold for much more than $4,000 more than likley I would sell it for $5,000. That's $1,600 profit. of which $400 would be mine.

Lets translate that to bottom line numbers. That's 8% off the bottom line.

Also keep in mind that the overhead variable above that my boss came up with was not accurate. I don't know where he came up with that number because the overhead number I came up for his business was much higher, but that was the agreed upon overhead variable. I suppose because we always ran multiple crews so he took his true overhead number and divided it by crew. <shrubs>

That's how it worked.

[Cole]

Cool, that is what i thought was happening.