Make Dirty Millions the Clean Way by wkirk777@aol.com - HTML preview

• No conflicting commitments that might interrupt their subcontracting agreement with you and your company. Make sure that they are not already overbooked when they accept

your subcontract. You don’t want them subcontracting your work to another company.

Third party subcontractors may not be getting enough money to do a good job, because

the first subcontractor you hired will also take a cut of the money before paying the third subcontractor.

When you subcontract out a job, you will not be working on the site daily, so you should try to check in every day by phone, to make sure everything is running smoothly. Site visits should take about one hour per building, when you do get the time to do so. If you are unable to make the visit yourself, you should send a qualified supervisor or staff manager to take notes on how well the job is being done, and what, if anything, needs improvement. Keeping your company’s reputation in mind, make sure your supervisor gives the building the white glove test as he or she walks through the building with a notepad or a small tape recorder. Subcontracting means you, basically, don’t have to visit that job Monday through Friday. However, it is still your contract, in your company name so try to get out there and inspect. The property manager or owner will still be holding your cleaning company, under your signed contract, liable for any mistakes or work not completed by the subcontractor doing the work. So stay on top of things each day.

Obviously, you need to be careful when you choose a subcontractor. Be sure to always keep your own business insurance up to date, even for jobs you subcontract. Again, the contract is still in your name and you are responsible if the subcontractor drops his or her insurance for some reason, and an employee or person gets hurt on the job. It is also important that you follow the labor laws on wages for subcontractors. This is why it is feasible for you and your company or accountant to check all of the subcontractor’s tax and hiring policies. Employees or ex-employees cannot become subcontractors for you, because you must take taxes out of an employee’s check each payday. This is not so for a subcontract. You pay the subcontractor the amount your contracted to pay (about sixty percent of the contract you got), and your accountant gives them a 1099 tax form at the end of the year for the money your company paid them. The subcontractor, not you, takes care of the taxes on the money you pay out to them. You will probably want to have your subcontractors sign a non-compete agreement. Commonly, a non-compete agreement say the person or sub contracting company will not try to take any of your jobs within in a specified geographic area that you sub to them for about two to five years.

As a rule, you can subcontract out around fifty or sixty percent of all of your buildings contracts, give or take a few. How much of your business you subcontract out is up to you, how many quality subcontractors you can find, and how many buildings you can get cleaning

contracts on. You never want to subcontract out all of your contracts. At the end of that two-to-five-year cleaning contract and or agreement, some of your subcontractor, who are your

competitors in business for themselves, will try to bid for the contract, and will take your place.

Even though you had them sign a non-compete agreement, some subs will try anyway. They will try to acquire that contract when it comes up for bid again, or before, this I can almost guarantee you, as they say, when it comes to money.

If you were to have contracts to clean fifty buildings, you would keep all or about twenty of them for you and your staff to clean. The other thirty jobs you could sub out to your reliable cleaning subcontractors. Using this approach, no matter what happens to your thirty buildings you have subcontracted to someone else, you will still have an income from the ones you did not sub out, so you can always stay in business. Most cleaning subcontractors, once you get to know them, are among the best people in the cleaning business world. They are really honest people who just don’t have the business skills or knowledge to understand and sign a contract, make it work for them without help from, someone like you, and your company. They just want you to keep them working as one of your subs. Some construction or cleaning subs just do not take the time to learn how to bid a large contract or deal with large, or even small, clients, doing all of the paperwork, or working face-to-face with new or long-term business clients. The hands-on part of managing a construction or cleaning business is not for everyone, but we are trying to change some of that with this how-to book, if just a little. Until the change happens, allow subcontractors to work for you and make some money for their company, without having to deal with bidding, contracts and the face to face business parts of this process. Most of these subcontractors will be devoted to you as long as they are working and can take care of their small business and family.

Don’t assume that because a property manager gave you a cleaning contract for the last five years, you will automatically receive the job again next time. As soon as word gets out that a contract is coming up for bid again, everyone, including some or all of the subcontractors working with you, will put his or her business in a position to take this contract from you. Keep in mind that everyone has a right to bid on these jobs; this is business. You have to think about the point of view of your last subcontractor. If they subcontracted to work for you, and their business only got paid $18,000 per month by you, that subcontractor will hope to win the entire $30,000

per month contract. Really, it is only fair for that business to win the contract from you, if you do not keep your competitive edge. Think about it, $30,000 versus $18,000. That’s a big difference in the subcontractor’s monthly pay, so you can understand why he or she will try to take your contract.

Nearly every contract you have or are subbing out was taken from a company that may have had it for years, until you came along with your great bid package. Again, it’s not personal; it’s just part of doing business. You win some, and you lose some. That’s also one of the reasons you never subcontract out all of your jobs. You continue to do the cleaning on some of your contract cleaning jobs yourself, so others are less likely to know when the contract is up or how much you are making from the contract. Your sub contractors are in these building five days a week, they see, know, and hear things about the buildings before you do. Some companies are comfortable with subbing out as much as 90 percent of their building cleaning jobs. I am not. Again, sixty percent or less is as much as I will sub out, using only a few good subcontractors, no

subcontractors I don’t know well. You can go to The Blue Book Building and Construction, for your area to get all types of subcontractor information. This will help you find a few thousand construction and good cleaning subcontractors that are willing to help you in a short time.

Subcontracting is a very useful tool. It can benefit your business in many other ways. For example, by subcontracting work, you free yourself up for other work opportunities. You can temporarily subcontract that work and bring a new client on board, building a relationship with the client without straining yourself or your employees. Your business will continue to grow if you subcontract some of the work that comes your way. If you want to make dirty millions the clean way, subcontracting is one good way to achieve your goal quickly.

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The Benefits of Subcontracting

Subcontracting is one of the fastest ways to start becoming a millionaire in many fields, including ours. Suppose you have two $25,000-per-month contracts and you subcontract the jobs out to another qualified cleaning service. You will pay the subcontracting company about forty percent, or $30,000, each month to do the cleaning in the two buildings. The good part is that you will make a profit of about $20,000 per month (the difference between the

$50,000 you will be paid for the two contracts and the $30,000 you will pay the subcontractor for cleaning the two buildings), while not having to work every day on these jobs. That’s not a bad return! Subcontracting these two buildings gives you the freedom to develop new bids for future contracts and work on other jobs, rather than being tied up working five-days-a-week on these jobs.

With these two jobs covered, you will have time to reach out to many more property

managers and clients and line up additional jobs for you, your staff and your good subcontractors.

Although you need to oversee the work time to time of your subcontractors, using the sub still saves a lot of travel time for you and your staff. The extra time you gain allows you to do extra cleaning in the contracts you do not sub out. That may be important to you and the customers your company does clean for, because you give more attention to their properties and their needs.

Always take good care of your clients and your subs. By hiring good subcontractors, you may be walking away with your business bill payments, a company car payment, some company savings, and/or a business mortgage. The more subcontracting you can do, the faster your income will grow.

Another way to use subcontractors is for specialty work that you don’t have time or

expertise to do. For instance, if you have a yearly contract that needs some floor work, you can always call a floor subcontractor to strip, wax, and buff the floors. This frees your employees to service other contracts or buildings. When it comes time for the high windows to be cleaned on your contracts, you might subcontract the exterior windows to a qualified subcontractor who specializes in high-window cleaning. More often than not, you will be giving your subcontractor the opportunity to make a significant amount of extra money for just a few days’ work. If you are bidding $5,000 to do a few exterior windows, you can pay your subcontractor $3,000 for two or three days’ work and still make $2,000 yourself. This is a decent amount of money in two days.

Again, all you did was set things up with a phone call to a window subcontractor you knew would do a good job. Of course, if you decide not to subcontract work on a job, it is still your contract, and you can make all of the money for yourself and your employees, as they do all of the work.

Subcontracting can get you out of trouble when you are in a crunch or need help. For

instance, if you have a few subcontractors that are already doing jobs for you, they might be pretty flexible when a problem comes up. If you get an emergency phone call about a flooded basement from the property manager of one of your contracted buildings, and it’s one of your big accounts, you’ll want to get out there and take care of it immediately. But what if all your employees and staff are busy on other jobs? They can only do so much. This is the time to call one of the subcontractors already working for you. He or she may need additional equipment like a wet vacuum, mops, and buckets, or may even need to use some of your equipment that’s

already in the building. Provide it this one time, they can fix the problem. When it comes to emergencies, it’s OK to share your equipment, supplies and employees with a subcontractor to get the emergency job done. Once the subcontractor fixes the problem, put it in your next invoice as an extra to the property manager quickly, so you can pay the sub promptly for his or her extra work and effort. Even if you don’t make a dime on the flood clean up, the subcontractor made everyone happy, and you are still in good standing with your customer, from whom you will continue to make money. As you will learn, it’s priceless to be able to call a sub in an emergency and make things happen quickly. There are times when your subcontractor may even work a

second or third shift job for you while you get a good night of sleep. In the morning, the job is complete, and both you and the subcontractor have made money.

Make sure that you pay the subcontractors well or more if you can, as you may need

emergency help again. Whether a problem is big or small, your subcontractors will be able to assist you in taking care of whatever comes up. It’s also important to remember when a person helped you out in a pinch. Find out what the head person’s favorite upcoming movie or sport is, and purchase a few tickets or give them the extra money to do so for them self. You may put out a few dollars now, but they might help your company make thousands of dollars later; it’s just a way to show your appreciation.

Sometimes, companies that are subcontracting for you may not be able to keep all of their employees busy. Usually, these people are looking for work and are very flexible and well trained. You can use them temporarily and/or part time when you need them. They’ll be willing to jump in the van and work for you temporarily until their own boss can put them back to work.

Use these good cleaners, for as long as they are available, to help your business. Temporary help is another advantage you get from building business relationships with subcontractors.

Every now and then go to other contractor’s job, when you see the potential

subcontractors pulling up in their vans and trucks to start a shift at their building sites, walk over, pass out your business cards and ask them to explain what they are doing on their shift that day.

They’ll appreciate that you are interested and asked for their help, and you’ll be surprised at how much help and information you’ll receive when you show respect for them. If you need someone to work part time on some upcoming projects, ask whether they are willing to help you out. Give the workers your business flyers that

explain in detail what you do, and let them know to be on standby for the next job if they are free and need to make some extra money. They’ll soon start to contact you for job updates when their business is slow, just to see if you need anything done. So, subcontracting can help you develop a group of people who can help you out when you need help the most.

Always view any cleaning or construction business situation as a learning opportunity,

whether it’s good or bad. Maybe, once you get to know them, your subcontractor’s employees will allow you to visit the building they clean each night. You may find that they have different standard daily procedures than you do for cleaning, or that they have a lot of contracts with other cleaning companies. You’ll now be more knowledgeable about that particular type of sub, and know a little more about the building they’re cleaning. Once you get to know the subcontractors and some of their employees, you might put them on your payroll part-time to supervise a small job. At bidding time, they may be able to give you valuable advice about their particular building, if it looks like their boss or company will not be bidding on the contract that year. Basically, one hand will wash the other. Or should I say, “One hand will clean the other”? Again, this is good clean business, making contacts and networking.

Once you get between ten and fifty jobs up and running, with subcontracted construction

or cleaning companies doing much of the labor, you will be making a pretty good amount of money, while you and your staff are still working at or cleaning your other buildings. The more subcontracting you can do, the faster your income grows. Who knows? Maybe one day, with the experience you have had subcontracting, you might even start your own cleaning franchise business. To start your own franchise business, first do some research and learn how franchises such as the Service Master Cleaning Service and Jani-King work. Find out as many details as you can about the many contracting and cleaning service franchise companies out there. They are hoping you will contact or call, to get there free information package, so they can try to one day sign you up as one of their cleaning franchise partners.

Subcontracts can go two or three ways for you. You can accept subcontracts from other

construction and cleaning services, or you can become a large contractor and give subcontracts to good construction and cleaning companies. Your goal in the beginning is to get contracts from a lot of companies for a certain amount of money per year, month, or week. You take this work and either do it yourself or with a few of your employees. I have even been the subcontractor for another (third party) cleaning contractor, when I found that I was too busy to do work I had been subcontracted to do. So I had to sub this work out to one of my smaller cleaning service subcontractors as a third-party joint venture contract and some of my competitor has done the same with my subbed out work. (A joint venture contract is when several contractors join together to make one business venture work for the same customer. In this case, a huge general contractor subcontracted out some work to me. I was too busy to do the work, so I subbed it out to a smaller subcontractor and paid him when I got paid. My small subcontractor did a good job and he made all of us some money, I made some money, and the original general contractor was happy because the work was well done and he made money, so the architect paid the general contractor, and the owner approved or freed up his funds, and paid the architect as we join together on this joint venture.)

Subcontracting is a pretty large business for all construction contractors. There’s a great deal of information about ways to obtain and use subcontractors to help you get rich or make millions, visit: www.construction.com/network/. Again, there is nothing better than receiving a check for $25,000 or more for work that is fully completed, when all you had to do was make a few phone calls, visit the site one or two times, and type up an invoice or fill out a small form or two. Just knowing that a check is coming to you when the job is finished, leaves you with a very secure, satisfied feeling.

It is important that you have resources on hand to provide you with information you need. They will not only help you start your business, but also will continue to benefit you and your business in the long run. So I would like to share several of the written resources that have been extremely helpful to me throughout the years. Please continue to research each week and find more resources on your own. What I can’t list here are the people who have been resources for me. There is a lot to learn from people, as well as from reading, so make use of the written resources that work for you over and over, but also develop human/people resources for yourself. As you start to grow your business, remember to find smart, trustworthy people to learn from and rely on.

For low interest capital and finance please contact, D & Y Financial Service Consultants, Darryl Smith, 713-920-0330 -or- toll free: 866378-9616, email: dsmith@estreetbank.com, visit web site at: www.

estreetbank.com

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Resources

Books and Other Publications

• The Black’s Guide is called by some the “bible of industrial and commercial real estate.”

Here you will find lists of properties with the property managers’ names and phone

numbers, and thousands of company names and addresses listed by city and state, with

each building’s square footage. You will find buildings from as little as 10,000 square

feet to buildings of 500,000 square feet. You can find out when the next bids are due on each building as you make your cold calls. The Black’s Guide is not a free publication,

but it may be at your library. You can also purchase a copy by going online at

www.blacksguide.com, or by calling 800801-9774 or 800-500-2450, ext. 278 and asking

for the subscription department, or by writing them at 251 Fifth Avenue, 7th Floor, New

York, NY 10016.

• The Blue Book Building and Construction has been one of the construction industry’s

premier contact and information sources since 1913. The Blue Book lists over one

million company contacts, just the million plus in your area or local tri-state if that’s all you are interested in. It publishes regional construction directories in most major cities throughout the United States. Visit their website at www.thebluebook.com and see how it

provides easy access to continually updated information for each of The Blue Book

regional editions. It will help you find project leads, professional service and support, regional networking events, complete online bid solutions, priority positioning,

subcontracting, and a lot more. The website, which averages over two million page views

a month, is a good starting place for advertising your services. You may find contact

information for people and construction companies that may not have a full address listed in other sources, go to the Blue Book and find complete contractors addresses. The Blue

Book is a great start-up resource.

• Commerce Business Daily (CBD) used to list thousands of government jobs across the

country and provide a contact connection for each government job. Now it is useful

mostly for information about jobs that are listed before bids are due. The lists of

government jobs are also available at Federal Business Opportunities. See the listing for Federal Business Opportunities, check websites.

• CDC News publications are put out by the Construction Data Company. It lists new

construction projects throughout the U.S., and will help any contracting business find

contracts. You will find square footage, architects, scope of work, locations, bid types, owners, property managers’ starting and ending dates, updates, and how to get plans,

blueprints, and more. For more information visit www.cdcnews.com or call 800-652-

0008.

• Headquarters USA a two-volume work published annually, is a telephone/fax directory

with nearly 113,400 up-to-date listings of the headquarters from small, to the largest and most important businesses in the United States and Canada. It also includes many

military bases, research centers, libraries, chambers of commerce, nonprofit

organizations, professional associations, government agencies, offices,

colleges/universities cultural institutions, business leaders and other notable individuals.

It is published by Impact Publications which can be searched at

www.impactpublications.com/index.asp or visit: www. omnigraphics.com.

• Government Giveaways for Entrepreneurs #3, by Matthew Laski gives a different

approach to getting business information and help from the government. You can contact

him online at http://www.lesko.com or call 301-924-0556.

• The Government Phonebook USA lists all government agencies across the country. This

book will also give you all of the federal, county, state, city, and local agencies. The Government Phone Book USA has about 250,000 listings including every main

government office in the U.S. It can show you where to go, who to talk to, and how to

find answers to new business questions. It’s not too expensive to purchase. For more

information, call 800-234-1340 or visit www.omnigraphics.com

• The Internet Yellow Pages, gives you web addresses for all kinds of businesses. It is the only Internet directory to incorporate a rating system into its listing. It provides specific traits and features for each website listed and informational blurbs with each link

describing exactly what you’ll find at that website. For more information, visit InformIT

at http:// www.informit.com/

• Office Buildings Magazine put out by Yale Robbins, Inc. provides information on

commercial office space listings, including building photographs, data on individual

properties, local broker directories, area maps, editorial content including major deals, new development and more. It is available by calling 212-683-5700 and asking for the

subscription department, or by going to www.mrofficespace. com

• Think and Grow Rich by Napoleon Hill describes old money-making secrets that can

change your life today. This book will teach you the secrets that will bring you a fortune.

It will show you not only what to do but how to do it with systems that are still being

used today.

Companies, Organizations, and Websites

• The American Bar Association (ABA) provides information about the law, lists of local lawyers, and initiatives to improve the legal system for the public, among other things.

You can get information about the ABA by calling 800-285-2221 or by going online to

http://www.abanet.org/home.html

• The Automatic Data Processing Service (ADP) provides one of the best nationwide

payroll accounting services to help keep track of employee payroll and tax deposits. You can visit them at www.smallbusiness.adp.com or contact them at, 71 Hanover Road,

Florham Park, NJ.

• BB-Bid is The Blue Book’s online bid management system. You may call them at their

toll-free phone number, 888-3032243, to get more detailed information or go online to

www. thebluebook.com & (www.construction.com/network/)

• The Building Service Contractors Association International (BSCAI) represents over

2,000 companies that provide cleaning, facility maintenance, and related services to

building owners and managers. BSCAI provides educational programs, publications,

video training programs, seminars, and networking opportunities, for the building service contracting industry. You can visit them at www.bscai.org, or call them at 800-368-3414, for more information.

• Business Link Fax Service is one of the many companies that will fax out your business information to a list of fax numbers provided by you. You can go to www.blifax.com or

call 516-982-4146 for more information.

• The Construction Data Company (CDC) is a good source of information about new

construction projects around the country through its CDC News publications. For more

information visit www.cdcnews.com or call 800-652-0008.

• Federal Business Opportunities (FBO). It is the U.S. government’s virtual marketplace where commercial vendors and government buyers can post, search and retrieve

opportunities solicited by the entire Federal government contracting community. You can

find information and introductory material about FBO at https://www.fbo.gov/

• FindLaw’s Small Business Center provides information and resources for small business owners, and help for entrepreneurs seeking to get a business idea off the ground. They

have information on choosing and forming the right legal structure for your small

business, legal tips on day-today business operations, an overview of employment law

issues, and much more. You can find them online at www. smallbusiness.findlaw.com

• Government Data Publications, Inc. is a private company providing information about

government contract and subcontract opportunities and tools to help businesses bid on

government contracts and subcontracts. For information go to http://www.govdata.com or

G.D.P. Building, Computer Operations Center, 1661 McDonald Ave., Brooklyn, NY,

11230.

• MrOfficeSpace.com is the largest database of independently verified real estate listings, mostly in the Northeastern U.S. Listings are updated daily. It includes details on available spaces in every office building including maps, aerials and building photos.

• The National Electronic Procurement Assistance Center (NAPAC) lists government

buildings, contract awards, bid due dates, people to contact, and addresses of job sites.

Jobs listed here can pay anywhere from $100 to $1,000,0