Surly Thread of Business Owners/Managers, Etc. & Current Business Climate

[VABuckeye 2472]

I have a small business in Virginia.  We also do work in other states as we're slowly expanding.

Obviously, COVID-19 is having a big impact on what we do and how we do it.

I rely on boots on the ground.  We do low voltage cabling in offices, in data centers and on government projects.  We also do infrastructure work in data centers.  Once the data center is built we build the environment inside the environment for the customer of the data center.

The purpose of this thread is so we have a place to share how we are coping with the challenges we are facing now as they are unprecedented (at least in my lifetime).  I face specific challenges because my business is not built on a recurring revenue model.  We do projects then 30 days or whatever later we get paid.  Those of you who are on the contracting side get this.  We can get a bg chunk of money in but sometimes it has to last a long time.  This is always a challenge but right now it proves to be an even bigger hurdle with the state of business today.  We are ok for the time being as we are completing a large project in California in the next week or so and I have work for the huys when they return home.  That is, if they don't have to be quarantined first.  We also have a very large project for the federal government that is ongoing but that could be shut down at any time depending on the escalation of the virus.

I'd like to keep the focus discussed on thoughts and ideas on how we can help and support one another and keep individual politics out of it.

[VABuckeye 2472]

Adding this.

Something blacklab posted in the other business thread got me thinking.

My company needs a new website.  I tore the old one down because I hated it.  If this is up someones alley perhaps we can negotiate something fair for both parties.

[Wulaw Horn 19063]

immediate things I’m putting in place:

1) save/hoard as much cash as possible 

2) cut any unnecessary expenses related to anything other than the core of “running the business” that makes revenue appear- if it’s not something that directly helps me bring in revenue or is mission critical to my business I’m not doing it 

3) be quick to cut staff when there’s no revenue to support them. They can be furloughed and brought back later- if this thing gets really bad you can’t carry them throughout the term, and benefits and help from the government should be pretty fast- better for Uncle Sam to carry them than it is you or I as the business owner- it might be the difference between being an ongoing business and not existing in 6 months 

4) dig in hard core on who your customers are and where the demand comes from and measure the elasticity in demand going forward if we are in a recession/depression conditions 

5) keep an eye on whatever your exit strategy is and pull the plug before it devours your current personal assets- don’t feed the business “until this is over” if that’s not viable- no shame in going out of business in this environment and you are likely to get the best of what we is coming from government/creditors if you move now with the mass of people and not later. Don’t be overly optimistic about what recovery looks like/ if you were barely making it right now what’s your future business look like with 20% less GDP- don’t be afraid to rip off the bandaid. 

So far so good for me. I had a huge board built up due to rates falling (mortgage and title business- separate). I was afraid my revenue would drift toward zero if we got a shut down- but looks like we are essential so I’ve got revenue coming in to operate as normal. We will hoard as much cash as possible to tide us over but if we go into recession/depression I will be running as lean as possible. 

Everything I’m devoted to right now is how to grow revenue- dig in with my past customers and try to take market share from the dipshits in my industry if a recession/depression hits. Will that. E enough?  No idea. 

Finally/ be honest and transparent with employees. They only have a job as long as revenue comes in so everything they do at all times should be focused on bringing in revenue or mitigating costs. The better you are as an employee in these issues the more secure your job is. Do it humanely and in a positive way- but let them know times are tough and for this to work everyone has to pull on the rope to make it work. 

Good luck to all. There will always be opportunities presented by the market in any situation. Take advantage of that. 

[Drew 2401]

So basically after going through all of these stay at home orders It really only affects a few businesses.

Bars that don’t serve food. Dine in only restaurants. Barbers, salons, tattoo parlors. Entertainment places.

That’s it.

So pretty much 80%, or more, of businesses are all deemed essential.

I’ve seen Pawn shops and Home Depot’s and every other box store retailer open

Apparently car sales is “essential” in this time so we’re all open too. M


What’s the point of these orders if they affect only a very small number of people and will have NO effect on stopping the curve?

[deadshank 24652]

6 minutes ago, Drew said:

So basically after going through all of these stay at home orders It really only affects a few businesses.

Bars that don’t serve food. Dine in only restaurants. Barbers, salons, tattoo parlors. Entertainment places.

That’s it.

So pretty much 80%, or more, of businesses are all deemed essential.

I’ve seen Pawn shops and Home Depot’s and every other box store retailer open

Apparently car sales is “essential” in this time so we’re all open too. M


What’s the point of these orders if they affect only a very small number of people and will have NO effect on stopping the curve?

Thanks for the input.  (There's another thread for your post)

Edited March 24, 2020 by deadshank

[VABuckeye 2472]

It affects those of us that have to get materials on job sites.  Every item we are supplying for the project in California has "Made in China" stamped on it.  Until the supply chain is truly rolling from there I stand a chance of the difficulty of sourcing critical materials for a project.  Yeah, we are deemed essential but if we can'y get material on the site for the workers we are dead in the water on that project.

It was mentioned in the bigger thread many pages ago but our manufacturing base needs to spread beyond relying on China for everything.

Edited March 24, 2020 by VABuckeye

[Sgt Hulk 13712]

The ones unable to telework or take advantage of technology will be the ones that struggle, the true human to human service will hurt

[DalTxHornFan 3097]

I own a small consulting firm with a couple of other guys.  The main thing that we are seeing is how unimportant our physical office space really is.  Lots of dollars going in there, but nobody is using it and the money from clients is still coming in via wire or mail.  I think we are gonna look really hard at some of our prior decisions when it comes to lease renewal time.

[Drew 2401]

Thanks for the input.  (There's another thread for your post)

Sorry I didn’t put I just opened an independent rental car company and have to stay open just because.

[VABuckeye 2472]

10 minutes ago, DalTxHornFan said:

I own a small consulting firm with a couple of other guys.  The main thing that we are seeing is how unimportant our physical office space really is.  Lots of dollars going in there, but nobody is using it and the money from clients is still coming in via wire or mail.  I think we are gonna look really hard at some of our prior decisions when it comes to lease renewal time.

Maybe consider one of those shared suite deals where you can reserve it when you absolutely have to have a place for client meetings, etc?

[deadshank 24652]

17 minutes ago, Drew said:

Sorry I didn’t put I just opened an independent rental car company and have to stay open just because.

Details, details

[DalTxHornFan 3097]

9 minutes ago, VABuckeye said:

Maybe consider one of those shared suite deals where you can reserve it when you absolutely have to have a place for client meetings, etc?

Yep.  We do that in three cities, but still have a mother ship office in Dallas.  We may rethink the mother ship. 

[Tailgate 3021]

Our model has always been lean and mean. I had my last exit six months after hiring employee number one. How I survive in a crazy fucking world.

[InkaUtexas 25852]

1 hour ago, VABuckeye said:

Adding this.

Something blacklab posted in the other business thread got me thinking.

My company needs a new website.  I tore the old one down because I hated it.  If this is up someones alley perhaps we can negotiate something fair for both parties.

I will help. Been writing for contractors for 19 years. 

[blacklab 11926]

VA I can build your website

Right now I'm at a startup and we had to let 2 people go and we're down to the founders and a salesman. Our software helps with the hiring process and needless to say no one is hiring right now, much less buying software to help hire. It is free to non-profits and we did close one of the biggest in town this morning, so we got that going for us, which is nice. What really sucked for us is we're in the middle of raising money and the group of 10 or so investors all told us they are holding off for now.

If you hire or have openings let me know and we can schedule a demo.

What I'm really looking for is a interactive website or project to work on. If your business emails around spreadsheets or word docs keeping track of stuff and you'd like a website and/or mobile app to track and maintain let me know. I know money is tight but I'll work out a payment plan. Things like payment systems, shopping carts, scheduling, and inventory are all things we can help automate. We can also do simple websites as well. 

 

[InkaUtexas 25852]

1 hour ago, DalTxHornFan said:

I own a small consulting firm with a couple of other guys.  The main thing that we are seeing is how unimportant our physical office space really is.  Lots of dollars going in there, but nobody is using it and the money from clients is still coming in via wire or mail.  I think we are gonna look really hard at some of our prior decisions when it comes to lease renewal time.

I use one for DC visits, but work from home/cafes since 2009. I think this will change how we look at space vs. assets. Only thing that kills me is lack of proposal production facility in house with the death of the mom and pop print shops. 

[RollLeft 5040]

5 hours ago, VABuckeye said:

I have a small business in Virginia.  We also do work in other states as we're slowly expanding.

Obviously, COVID-19 is having a big impact on what we do and how we do it.

I rely on boots on the ground.  We do low voltage cabling in offices, in data centers and on government projects.  We also do infrastructure work in data centers.  Once the data center is built we build the environment inside the environment for the customer of the data center.

The purpose of this thread is so we have a place to share how we are coping with the challenges we are facing now as they are unprecedented (at least in my lifetime).  I face specific challenges because my business is not built on a recurring revenue model.  We do projects then 30 days or whatever later we get paid.  Those of you who are on the contracting side get this.  We can get a bg chunk of money in but sometimes it has to last a long time.  This is always a challenge but right now it proves to be an even bigger hurdle with the state of business today.  We are ok for the time being as we are completing a large project in California in the next week or so and I have work for the huys when they return home.  That is, if they don't have to be quarantined first.  We also have a very large project for the federal government that is ongoing but that could be shut down at any time depending on the escalation of the virus.

I'd like to keep the focus discussed on thoughts and ideas on how we can help and support one another and keep individual politics out of it.

Service contracts.  It's what i tell any and all trades.  Whatever you can do to develop a service division you need to do it.   That means sales and service reps.  Whether it be maintenance contracts on jobs you did or a supplementary service or shared profit from a bundle with a follow up trade is what you need to develop.  Margin at a minimum should be 50% on those things and closer to 65%.             

[Wulaw Horn 19063]

1 minute ago, RollLeft said:

Service contracts.  It's what i tell any and all trades.  Whatever you can do to develop a service division you need to do it.   That means sales and service reps.  Whether it be maintenance contracts on jobs you did or a supplementary service or shared profit from a bundle with a follow up trade is what you need to develop.  Margin at a minimum should be 50% on those things and closer to 65%.             

Yessir. 

If you are not doing everything to monetize your data base, at all possible times, by following up with additional products or services they might need while also asking them for testimonials, referrals and introductions you are doing it wrong. 

[StruggleBus 3922]

4 hours ago, DalTxHornFan said:

I own a small consulting firm with a couple of other guys.  The main thing that we are seeing is how unimportant our physical office space really is.  Lots of dollars going in there, but nobody is using it and the money from clients is still coming in via wire or mail.  I think we are gonna look really hard at some of our prior decisions when it comes to lease renewal time.

Same here. If my company makes it through this, my commercial lease is getting trashed when renewal time comes. 

[Wulaw Horn 19063]

I miss my office. It’s a hole in the wall that I pay $500 a month for but I can sit in there with my white board and my production partner and not have to be at home around little kids. No way I’m ever giving that up to WFH. 

Of course they’ve tried to talk to me about getting an office befitting my status as a titan of industry where we can show off and show out for customers and my response always is- nope- not unless you show me that this office will make money by virtue of its existence. I don’t think many locations in the service sector do, quite frankly. 

[BradInATX 9208]

12 hours ago, blacklab said:

VA I can build your website

Right now I'm at a startup and we had to let 2 people go and we're down to the founders and a salesman. Our software helps with the hiring process and needless to say no one is hiring right now, much less buying software to help hire. It is free to non-profits and we did close one of the biggest in town this morning, so we got that going for us, which is nice. What really sucked for us is we're in the middle of raising money and the group of 10 or so investors all told us they are holding off for now.

If you hire or have openings let me know and we can schedule a demo.

What I'm really looking for is a interactive website or project to work on. If your business emails around spreadsheets or word docs keeping track of stuff and you'd like a website and/or mobile app to track and maintain let me know. I know money is tight but I'll work out a payment plan. Things like payment systems, shopping carts, scheduling, and inventory are all things we can help automate. We can also do simple websites as well. 

 

 

Lab, is your product an ATS?

[G650 14229]

15 hours ago, VABuckeye said:

have a small business in Virginia.

Sames.

 

 

[Spaulding Smails 1552]

Subscribed.  I've posted in two of the other threads, but I have a construction (residential and commercial) and facility maintenance company in Austin.  65 employees currently.  80% of my workforce can't work remotely.  I was incredibly optimistic yesterday that construction was an "essential business".  Local trade organizations, my builder customers and my attorney agreed.  Last night, the City of Austin Development Services sent out a memo strictly forbidding construction.  We have until Friday to "make safe" job sites.  Now, I'm scrambling to figure out how we deal with those repercussions.   Tons hinging on the details of this most recent $2T bill and its effects on unemployment and small businesses.  An interpretation of that is going to have a huge bearing on my decisions over the next week.

From a general business sense, here's my takes:

THE GOOD

-Our balance sheet is super clean.  Minimal debt.  We own our property.  Big line of credit sitting idle.  Lots of assets paid in full.  

-We pay our vendors and subs super fast.  I can extend those terms and create additional cash-on-hand if needed.

-Our company is very diverse.  We offer a wide range of services to a wide range of markets.  I want more of that diversity when this is all over.  It's going to be huge in saving our ass.

-We have a strong backlog.  Though not on par with a big commercial firm, we have a legitimate 90 days of work.  I want to challenge my team to secure more work.  It was said above, but we're going to shift our business model during this downtime to create more commissioned sales opportunities on the service side.

-I should still have cash coming in.  We have 30+ days of revenue store in accounts receivable.  Assuming those invoices don't hit snags, I may actually see cash reserves increase in the next few weeks.  

THE BAD

-The first bill includes guaranteed 80 hours of paid time off for employees.  That takes effect April 2.  That's my deadline.  Though that would be reimbursable to me in the form of a payroll tax credit, it would be a huge hit on cash flow to float 65 employees with minimal revenue.  I have our HR consultant helping me figure out what we're going to do, but we have to act by April 1.  That's probably going to be layoffs for a few salaried overhead positions and anyone that has been with us less than 90 days.  

-If this thing lingers for longer than a few weeks, we're probably going to have to lay a bunch of people off.  I don't envy restaurants, hospitality, etc.  They've already had to make those decisions.  I'm dreading it.  I've developed a tiered approach, but I'm guessing I'll have to reduce workforce by 1/3 if we're not back to work April 13.

-When we get back to work, demand is going to be pent up.  It will be short-term, but jobs that were underway are going to want to catch up.  Jobs that were supposed to start April 1 are going to want to start immediately.  Jobs that were going to start mid-April are still going to want to start mid-April.  We're going to see a big push with limited resources in a very short amount of time.  

-The supply chain will be taxed when we get back to work.  Nothing will be easy to get.  We've already banned our guys from going to Home Depot between 7 AM - 5 PM because the lines are so long. 

-We'll probably see a jump in the price of materials.  Tightened supply will lead to higher prices.

-We're going to get undercut.  We're a premium service provider.  We lost a job this week to another smaller contractor.  The ripple effect will be stronger and more continuous as people get desperate for cash and sacrifice profitability.

-The backlog is going to come to a screeching halt.  Once we work through what we have, new jobs are going to be few and far between.  As mentioned elsewhere, commercial development is going to take a huge hit.  You have to think that residential construction will be the same.  Hence my previous point about a much stronger focus on service.

Thanks for creating this thread.  Great to have a sounding board.  If nothing else, misery loves company!

[blacklab 11926]

1 hour ago, BradInATX said:

 

Lab, is your product an ATS?

Yep. Started out as video matching but we’ve added ats functionality 

Edited March 25, 2020 by blacklab

[DaggerHorns 3082]

I’m not getting any business at the moment. 
 

The girls are scared and not getting any regulars or new business because of social distancing. 
 

There is less competition out there on the street corners we typically work. Many will probably leave the market after this virus due to health reasons and/or death. I’m glad I offer premium healthcare.

Once this crazy time is up, I think I have a real opportunity to grab more market share. I think I’ll probably do special pricing or my own version of GroupOn. Maybe 3 hand jobs for $10, or overnight stay 1/2 off. 
 

At the end of the day, I think of this more as an opportunity, not a problem.

[Wulaw Horn 19063]

29 minutes ago, Spaulding Smails said:

Subscribed.  I've posted in two of the other threads, but I have a construction (residential and commercial) and facility maintenance company in Austin.  65 employees currently.  80% of my workforce can't work remotely.  I was incredibly optimistic yesterday that construction was an "essential business".  Local trade organizations, my builder customers and my attorney agreed.  Last night, the City of Austin Development Services sent out a memo strictly forbidding construction.  We have until Friday to "make safe" job sites.  Now, I'm scrambling to figure out how we deal with those repercussions.   Tons hinging on the details of this most recent $2T bill and its effects on unemployment and small businesses.  An interpretation of that is going to have a huge bearing on my decisions over the next week.

From a general business sense, here's my takes:

THE GOOD

-Our balance sheet is super clean.  Minimal debt.  We own our property.  Big line of credit sitting idle.  Lots of assets paid in full.  

-We pay our vendors and subs super fast.  I can extend those terms and create additional cash-on-hand if needed.

-Our company is very diverse.  We offer a wide range of services to a wide range of markets.  I want more of that diversity when this is all over.  It's going to be huge in saving our ass.

-We have a strong backlog.  Though not on par with a big commercial firm, we have a legitimate 90 days of work.  I want to challenge my team to secure more work.  It was said above, but we're going to shift our business model during this downtime to create more commissioned sales opportunities on the service side.

-I should still have cash coming in.  We have 30+ days of revenue store in accounts receivable.  Assuming those invoices don't hit snags, I may actually see cash reserves increase in the next few weeks.  

THE BAD

-The first bill includes guaranteed 80 hours of paid time off for employees.  That takes effect April 2.  That's my deadline.  Though that would be reimbursable to me in the form of a payroll tax credit, it would be a huge hit on cash flow to float 65 employees with minimal revenue.  I have our HR consultant helping me figure out what we're going to do, but we have to act by April 1.  That's probably going to be layoffs for a few salaried overhead positions and anyone that has been with us less than 90 days.  

-If this thing lingers for longer than a few weeks, we're probably going to have to lay a bunch of people off.  I don't envy restaurants, hospitality, etc.  They've already had to make those decisions.  I'm dreading it.  I've developed a tiered approach, but I'm guessing I'll have to reduce workforce by 1/3 if we're not back to work April 13.

-When we get back to work, demand is going to be pent up.  It will be short-term, but jobs that were underway are going to want to catch up.  Jobs that were supposed to start April 1 are going to want to start immediately.  Jobs that were going to start mid-April are still going to want to start mid-April.  We're going to see a big push with limited resources in a very short amount of time.  

-The supply chain will be taxed when we get back to work.  Nothing will be easy to get.  We've already banned our guys from going to Home Depot between 7 AM - 5 PM because the lines are so long. 

-We'll probably see a jump in the price of materials.  Tightened supply will lead to higher prices.

-We're going to get undercut.  We're a premium service provider.  We lost a job this week to another smaller contractor.  The ripple effect will be stronger and more continuous as people get desperate for cash and sacrifice profitability.

-The backlog is going to come to a screeching halt.  Once we work through what we have, new jobs are going to be few and far between.  As mentioned elsewhere, commercial development is going to take a huge hit.  You have to think that residential construction will be the same.  Hence my previous point about a much stronger focus on service.

Thanks for creating this thread.  Great to have a sounding board.  If nothing else, misery loves company!

Have a ton of thoughts/questions on this post but it’s long. You’ve got a super interesting situation there amigo. 

[Spaulding Smails 1552]

1 minute ago, Wulaw Horn said:

Have a ton of thoughts/questions on this post but it’s long. You’ve got a super interesting situation there amigo. 

When the dust settles, bring on the thoughts and questions.  I'm all ears for how the heck to deal with this.

[G650 14229]

Just now, Wulaw Horn said:

Have a ton of thoughts/questions on this post but it’s long. You’ve got a super interesting situation there amigo. 

It's pretty much the norm for all of us contractors at the moment. The fortunate thing for me is our jobs are in the 4 month to 1 year range, so we can carry through a lot more than say a builder or trade company, provided we don't get explicitly shut down.

[G650 14229]

1 minute ago, Spaulding Smails said:

When the dust settles, bring on the thoughts and questions.  I'm all ears for how the heck to deal with this.

I wish I had the answers. I'm terrified of having to cut a bunch of skilled people loose.

[RollLeft 5040]

37 minutes ago, Spaulding Smails said:

Subscribed.  I've posted in two of the other threads, but I have a construction (residential and commercial) and facility maintenance company in Austin.  65 employees currently.  80% of my workforce can't work remotely.  I was incredibly optimistic yesterday that construction was an "essential business".  Local trade organizations, my builder customers and my attorney agreed.  Last night, the City of Austin Development Services sent out a memo strictly forbidding construction.  We have until Friday to "make safe" job sites.  Now, I'm scrambling to figure out how we deal with those repercussions.   Tons hinging on the details of this most recent $2T bill and its effects on unemployment and small businesses.  An interpretation of that is going to have a huge bearing on my decisions over the next week.

From a general business sense, here's my takes:

THE GOOD

-Our balance sheet is super clean.  Minimal debt.  We own our property.  Big line of credit sitting idle.  Lots of assets paid in full.  

-We pay our vendors and subs super fast.  I can extend those terms and create additional cash-on-hand if needed.

-Our company is very diverse.  We offer a wide range of services to a wide range of markets.  I want more of that diversity when this is all over.  It's going to be huge in saving our ass.

-We have a strong backlog.  Though not on par with a big commercial firm, we have a legitimate 90 days of work.  I want to challenge my team to secure more work.  It was said above, but we're going to shift our business model during this downtime to create more commissioned sales opportunities on the service side.

-I should still have cash coming in.  We have 30+ days of revenue store in accounts receivable.  Assuming those invoices don't hit snags, I may actually see cash reserves increase in the next few weeks.  

THE BAD

-The first bill includes guaranteed 80 hours of paid time off for employees.  That takes effect April 2.  That's my deadline.  Though that would be reimbursable to me in the form of a payroll tax credit, it would be a huge hit on cash flow to float 65 employees with minimal revenue.  I have our HR consultant helping me figure out what we're going to do, but we have to act by April 1.  That's probably going to be layoffs for a few salaried overhead positions and anyone that has been with us less than 90 days.  

-If this thing lingers for longer than a few weeks, we're probably going to have to lay a bunch of people off.  I don't envy restaurants, hospitality, etc.  They've already had to make those decisions.  I'm dreading it.  I've developed a tiered approach, but I'm guessing I'll have to reduce workforce by 1/3 if we're not back to work April 13.

-When we get back to work, demand is going to be pent up.  It will be short-term, but jobs that were underway are going to want to catch up.  Jobs that were supposed to start April 1 are going to want to start immediately.  Jobs that were going to start mid-April are still going to want to start mid-April.  We're going to see a big push with limited resources in a very short amount of time.  

-The supply chain will be taxed when we get back to work.  Nothing will be easy to get.  We've already banned our guys from going to Home Depot between 7 AM - 5 PM because the lines are so long. 

-We'll probably see a jump in the price of materials.  Tightened supply will lead to higher prices.

-We're going to get undercut.  We're a premium service provider.  We lost a job this week to another smaller contractor.  The ripple effect will be stronger and more continuous as people get desperate for cash and sacrifice profitability.

-The backlog is going to come to a screeching halt.  Once we work through what we have, new jobs are going to be few and far between.  As mentioned elsewhere, commercial development is going to take a huge hit.  You have to think that residential construction will be the same.  Hence my previous point about a much stronger focus on service.

Thanks for creating this thread.  Great to have a sounding board.  If nothing else, misery loves company!

Given your industry it sounds to me like you run approximately 70k of payroll a week.  Your in a good position compared to most.  The question is cut people or tap into your lines of credit until  the government money comes in.  How's your WIP?  If strong i wouldn't hesitate if you insist on keeping staff.  It's a tough choice i don't envy it.  That said the guys who find it difficult to use their credit lines are the guys who never have to use them.  That's a good thing, until shit like this happens or you want to scale.

Edited March 25, 2020 by RollLeft

[Spaulding Smails 1552]

3 minutes ago, RollLeft said:

Given your industry it sounds to me like you run approximately 70k of payroll a week.  Your in a good position compared to most.  The question is cut people or tap into your lines of credit until  the government money comes in.  How's your WIP?  If strong i wouldn't hesitate if you insist on keeping staff.  It's a tough choice i don't envy it.  That said the guys who find it difficult to use their credit lines are the guys who never have to use them.  That's a good thing, until shit like this happens or you want to scale.

WIP is solid.  We're over-billed on a number of jobs and gross margins are tracking ahead of budget on 8 of our 10 largest projects.  I have two stinkers that are getting drug out and eroding profitability, but otherwise we're fine.

BTW, you nailed the weekly payroll number.  Damn near to the penny.  Well done.

[G650 14229]

Your labor is expensive.

[Spaulding Smails 1552]

7 minutes ago, G650 said:

Your labor is expensive.

Yep.  And it seems more expensive when I consider $0 revenue.

[RollLeft 5040]

4 minutes ago, G650 said:

Your labor is expensive.

It's possible, but he said he was a premium guy and was susceptible to being undercut.  That tipped me off as to how he prefers to run his labor.   Pays more for fewer problem.  Its a slippery slope but It's working for him thus far.  Also he's in Austin (vs Houston) so labor in general is harder to come by.  

[G650 14229]

Just now, Spaulding Smails said:

Yep.  And it seems more expensive when I consider $0 revenue.

I feel you. We are not far off on labor, but we have a ton of fixed costs on top of that. It's about half a millon a month for us to exist, before buying the first piece of material.

[G650 14229]

Just now, RollLeft said:

It's possible, but he said he was a premium guy and was susceptible to being undercut.  That tipped me off as to how he prefers to run his labor.   Pays more for fewer problem.  Its a slippery slope but It's working for him thus far.  Also he's in Austin (vs Houston) so labor in general is harder to come by.  

I'm in Virginia, so I don't know what the labor market in Texas is, I'm just speaking in relative terms.

[InkaUtexas 25852]

2 minutes ago, G650 said:

I'm in Virginia, so I don't know what the labor market in Texas is, I'm just speaking in relative terms.

They are about the same. Skilled labor gets paid in both places. Neither is the the rust belt. 

[Spaulding Smails 1552]

2 minutes ago, G650 said:

I feel you. We are not far off on labor, but we have a ton of fixed costs on top of that. It's about half a millon a month for us to exist, before buying the first piece of material.

Yeesh.  $500K is a big nut.  We're at about $350K/mo bare bones.  80% of that is labor.  

[G650 14229]

1 minute ago, Spaulding Smails said:

Yeesh.  $500K is a big nut.  We're at about $350K/mo bare bones.  80% of that is labor.  

Bulldozers are too damn expensive...

[RollLeft 5040]

4 minutes ago, G650 said:

I feel you. We are not far off on labor, but we have a ton of fixed costs on top of that. It's about half a millon a month for us to exist, before buying the first piece of material.

I've got a guy who has the same payroll number as you and fought me on moving to joint checks 60 days ago.  Anyway, he fought me on it.  Then i found some costs that needed to be added to the books.  Well, he's been playing the peter and paul game for a few months and now this.  No credit lines by the way and money coming in is not strong.  Insurance about to be canceled.  I've uncovered other major items missed in accounting and labor was mismanaged.  He fought it like hell the last few weeks but Its just now starting to set in on him.  

[G650 14229]

Just now, RollLeft said:

I've got a guy who has the same payroll number as you and fought me on moving to joint checks 60 days ago.  Anyway, he fought me on it.  Then i found some costs that needed to be added to the books.  Well, he's been playing the peter and paul game for a few months and now this.  No credit lines by the way and money coming in is not strong.  Insurance about to be canceled.  I've uncovered other major items missed in accounting and labor was mismanaged.  He fought it like hell the last few weeks but Its just now starting to set in on him.  

It's a bad time to be playing a shell game.

[VABuckeye 2472]

It certainly is.

Right now my nut is about $60k a month.  However, we have to provide materials up front and our largest client doesn't do deposits.  So I have to float materials constantly.  Fortunately I can invoice when I receive a PO so we get that invoice processing through the system on the front end so we do get paid close to project completion.  As noted by others supply chain on materials is going to be a bitch when we come out the other end of this.  I feel like whatever is in warehouses now if going to get burned through and then lead times will be through the roof.  We do a fair amount of data center work and everything there is on compressed schedules already.

[Iceman 2690]

I've shared in some other threads, but in grocery business. I don't work for the stores, so don't ask "Which one?"  Last week we ran about 135% of same week in 2019( that's how we typically measure our growth.) We are always focused on growth and there's not a lot of low-hanging fruit to go for, and then we ran just a staggering amount of volume last week.  That shouldn't really surprise anyone, but to put that kind of strain on the pipeline/ supply chain is just incredible. Stores are cranking, and they are in better shape now that recovery loads are hitting.

We have maintained staff and they are actually getting some incentives for just coming to work, above and beyond some huge ass bonuses they will have after last week.  Obviously the hours and shifts are much higher too.  Lots of folks are still volunteering to come in( for extra pay) on their days off.  Morale is medium to good, as we are still working in the public and that "what if" concern will always be there, as long as CV is on the prowl. So many times in the past two weeks either stores or our employees have asked, "What happens now?" and I have to say, " I don't know.  We've never been here before.  Let me get back to you."

Incredible times that we'll never forget...hopefully the tide turns soon and something remotely resembling  "normal" heads our way.

Edited March 25, 2020 by Iceman

[RollLeft 5040]

7 minutes ago, VABuckeye said:

It certainly is.

Right now my nut is about $60k a month.  However, we have to provide materials up front and our largest client doesn't do deposits.  So I have to float materials constantly.  Fortunately I can invoice when I receive a PO so we get that invoice processing through the system on the front end so we do get paid close to project completion.  As noted by others supply chain on materials is going to be a bitch when we come out the other end of this.  I feel like whatever is in warehouses now if going to get burned through and then lead times will be through the roof.  We do a fair amount of data center work and everything there is on compressed schedules already.

Are your billing practices standard for your industry or is it just how you have always done it?  It sounds like you are just billing once?  How long are the projects?  I always tell my guys to address billing in the contract so that mobilization and material are billed day one.   

[VABuckeye 2472]

Depends on the project.  For larger government projects it's incremental billing.  For data centers it's one invoice when the PO is received.  On the smaller stuff it's no big deal.  We get the work and in a week to 10 days it's done and we are at a net 30 payment cycle.  It's the bigger projects for data centers where we could be 60-90 days out from being paid that's a kick in the nuts to cashflow at times.  I'm working with the data centers to receive the materials portion of the invoice when material hits the site so I can compress that portion of the timetable for payment.

Nearly every one of our clients is on net 30.  One is on net 45 but they are very good at hitting that 45 day payment mark.

[RollLeft 5040]

12 minutes ago, Iceman said:

I've shared in some other threads, but in grocery business. I don't work for the stores, so don't ask "Which one?"  Last week we ran about 135% of same week in 2019( that's how we typically measure our growth.) We are always focused on growth and there's not a lot of low-hanging fruit to go for, and then we ran just a staggering amount of volume last week.  That shouldn't really surprise anyone, but to put that kind of strain on the pipeline/ supply chain is just incredible. Stores are cranking, and they are in better shape now that recovery loads are hitting.

We have maintained staff and they are actually getting some incentives for just coming to work, above and beyond some huge ass bonuses they will have after last week.  Obviously the hours and shifts are much higher too.  Lots of folks are still volunteering to come in( for extra pay) on their days off.  Morale is medium to good, as we are still working in the public and that "what if" concern will always be there, as long as CV is on the prowl. So many times in the past two weeks either stores or our employees have asked, "What happens now?" and I have to say, " I don't know.  We've never been here before.  Let me get back to you."

Incredible times that we'll never forget...hopefully the tide turns soon and something remotely resembling  "normal" heads our way.

Man, i applaud you.  That is a tough margin business.  Family business i assume.  Anyway, i wish you all the best.  Sounds like you are present and show you care so i imagine the staff will continue to fall in line.  If not the flip side is other people will be looking for work soon.  

Edited March 25, 2020 by RollLeft

[Iceman 2690]

2 minutes ago, RollLeft said:

Man, i applaud you.  That is a tough margin business.  Family business i assume.  Anyway, i wish you all the best.  Sounds like you are present and show you care so i imagine the staff will continue to fall in line.  If not the flip side is some people the will be looking for work soon.  

Not family owned. Bigger.  Way bigger. 

For all the shortcomings of corporate culture/ behavior, right now that size and strength is protecting our folks' earnings and allowing us to continue to take care of our customers in a way they expect from us. We did some stuff during Harvey that was home run, out of the park wins with our people.  Now we're seeing it again.  There have always been trade offs for not working on my own or for a family firm.  I am proud of this right now.  Nobody is perfect, but this is very, very good.

[Wulaw Horn 19063]

11 minutes ago, Iceman said:

Not family owned. Bigger.  Way bigger. 

For all the shortcomings of corporate culture/ behavior, right now that size and strength is protecting our folks' earnings and allowing us to continue to take care of our customers in a way they expect from us. We did some stuff during Harvey that was home run, out of the park wins with our people.  Now we're seeing it again.  There have always been trade offs for not working on my own or for a family firm.  I am proud of this right now.  Nobody is perfect, but this is very, very good.

I thought you worked for a big brand, not a big grocery store. 

Edited March 25, 2020 by Wulaw Horn

[Player 4575]

Spaulding - can you post the memo (or a link) to the City of Austin memo you referenced regarding construction? 

In a somewhat similar situation in Houston - we have a small structural steel fab shop, and although the "Work-Home-Stay-Safe" order that was issued by Lina Hidalgo specifically defines commercial (and even residential) construction as an essential business, her definition seems broader than what's found in the CISA guidelines. Could easily see her following Austin's lead and issuing a memo directing most construction to shut down. We make a lot of wastewater treatment components, so that may allow us to continue operations, even if on a limited basis. 

Has anyone parsed through the language of the Families First Coronavirus Response Act that passed on 3/20/20, and how it will impact your paid leave policies? My understanding is that it amends the FMLA to require: 1) up to 12 weeks of unpaid and paid leave for certain employees unable to work in order to care for a child, and 2) up to 80 hours of emergency paid sick leave related to certain specified coronavirus events. 

Moreover, it looks like these provisions may apply to all employers with less than 500 employees, even though the FMLA itself under normal circumstances doesn't apply to employers with less than 50 employees. It now seems like employers with less than 50 employees can seek an exemption from the Sec of Labor, but the process for that is murky. 

We have fewer than 50 employees, and are going to implement a policy to continue paying them in the event we get shut down (or if they or a family member get sick), but there are procedural concerns regarding how to do that without running afoul of the new legislation. And that's not even taking into account the language of any provisions that might be included in what passed last night. 

[deadshank 24652]

Harris County decree

https://www.readyharris.org/stay-home

City of Austin decree

http://www.austintexas.gov/sites/default/files/files/Order 20200324-007 - Stay Home - Work Safe.pdf

Travis County decree

https://www.traviscountytx.gov/images/docs/200314-gathering-order.pdf

Dallas County decree

https://www.dallascounty.org/Assets/uploads/docs/judge-jenkins/covid-19/03232020-AmendedOrder.pdf

Edited March 25, 2020 by deadshank