60% of a lot is a deal. 60% of nothing is not. So first of all you need to figure out what the dollar amount will be for a typical week. That’s the easy part, since you know how much you can produce in a week. Once you have that number then the hard part, what are your costs per week. Subtract the 2 and you will have your answer.
Here is what you need to consider for costs:
wages both you and your helper
your share of the payroll taxes (the employer pays about 7.5% of the gross payroll)
cost of general liability insurance
deductable for above
cost of workers compensation
SUTA
FUTA
Professional fees (Lawyer, CPA, etc. You will need both)
bank interest
income taxes
equipment costs (truck, trailer, pickup, lashers, rollers, jigs, ropes, safety gear, ladder, computer, office supplies, signs, and more. Just look at what you are using now.)
equipment maintenance (Lasher rebuild, tires, oil, boom repair, new drill bits, lost tool replacement, etc)
equipment depreciation (might not seem like an immediate cost but you will have to replace the truck and other tools sometime.)
phone / internet bills
shop / office / warehouse rent
cost of rain days (you may still pay your helper with no income that day)
unforeseen costs 5% to 10%
If the money looks favorable then you will need a banker, lawyer, CPA, and insurance agent all skilled in business. I would strongly recommend you have the attorney and set up a corporation or LLC. Have the CPA help you set up your books and payroll (there is more to it than just writing a payroll check to your helper). Visit you banker and let him/her know what you are doing so when you do need to borrow money, it will take less time. Your insurance agent will need to know what you are doing and skill level to give you the best rate.
Other things to consider:
you will need someone to do payroll, invoicing and other paperwork. Maybe it will be you, maybe someone else. I would recommend that it be you the first year so you understand the process better. It will make life a lot easier and cheaper in the long run if you have the CPA help you start out your books and payroll correctly.
you will have no more free time. If your not laboring in the field, you will be doing paperwork. And when you normally sleep you will be awake thinking “what if”.
Hope this helps.
Re: In-house lineman thinkin about becoming a sub
Member #: 44560
Registered: 2/21/2006
Posted:
451
Name:
Tony
Name:
Tony Gauer
Company:
TSB
Occupation:
Engineer
Location:
South Dakota
Personal:
late 60s
Experience:
~44 years
There is 1 reply to this message
