Business Tips

When Should I Rent Tools Instead of Buying Them?

A Rent vs. Purchase Case Study: A pressure washer is readily available from an equipment rental yard.  The first time I needed one, in order to save on the rental fee, I borrowed a pressure washer from another handyman.  He instructed me in all the intricacies of getting it started.  After pulling the cord about 20 times and fiddling with the controls, it finally started and I got the job done.  Whew!

The next time, I rented a machine at a cost of $60.  It also proved difficult to start, but even worse, after about 10 minutes it quit and refused to start again!  I hauled it back to the rental store for a replacement and finally finished the job.  It took me twice as long as I had planned.  Time lost equals money lost.

I decided to buy my own machine.  Purchased online it arrived at my doorstep for about $400.  It was shiny and new and had a Honda engine.  That engine started on the first pull and has never let me down.

Rent vs. buy?  If you need the machine frequently, buy it.  Think of it as an investment instead of an expense!  If you’re only going to use a machine once or twice a year, rent it and cross your fingers.

I have recovered the cost of my pressure washer by charging a $45 machine fee on every pressure washing job I do.  The fee covers gas, maintenance and wear and tear. You could easily do the same with any specialized equipment that you use.

Should I Specialize in One Type of Work?

After viewing the long list of projects above, you might be motivated to specialize in one particular type of work. I have been tempted to specialize because it is challenging to do so many different types of work.  On some jobs I find myself learning as I go and having to excessively focus on avoiding mistakes or wasting materials.

When you specialize in a particular area you gain economies of scale on your materials purchases. This improves your profit margins.  At the same time you minimize the cost of tools and equipment needed.  The work that you do becomes second nature and the learning curve for your helpers shortens.

Choose a specialty that has high demand and that you enjoy.  Your biggest challenges and your best earnings come when tackling the most demanding jobs in your area of expertise.  These are the jobs that only you, the expert, can do. Pest repairs, pressure washing, painting, landscaping, disaster preparedness, alternative energy, light carpentry, fence repairs, telephone and network wiring or home theater wiring are just a few examples.

Should I Hire Handyman Helpers?

The hiring of employees can be a great way to increase your income as a handyman.  Here is California, handyman helpers would earn from $15 to $25 per hour.  After figuring in payroll taxes and workman’s compensation insurance the cost per hour would be closer to $25 to $35 per hour.  Marking up the employee cost to $50 to $70 per hour to the client would net a profit.  Multiply this number by several workers at multiple locations and it starts adding up to some real money.

Besides hiring helpers to do some of the grunt work, workers can add flexibility to your scheduling.  They will enable you to overlap jobs.  This is particularly helpful when jobs take longer than expected or run into additional problems.   Tuesday’s work can start on schedule while your worker picks up the loose ends of Monday’s job.  Several jobs can be started at the same time and you can leave a job site to estimate new work or to pick up additional supplies.  The pool of jobs that you can take on will be bigger because you can accept more labor intensive jobs that you wouldn’t normally do.

Employees create many challenges.  Can you find any that are qualified?  Will they be honest and dependable?  Will the quality of their work be up to your standards?  Will there be enough of the right type of jobs to keep them working?  With the slim markups that you’ll be making on employee labor hours you can’t afford to have them sitting idle.  Your job turns into a supervisory and a marketing position where you’ll be applying your skills to meeting with new clients, estimating work, marketing your business and managing employees.

When you get to the point where you are turning away work because your schedule is full, it’s time to hire some helpers and build your empire!

Which Customers Will Pay the Highest Rate for Handyman Services?

Millions of homeowners will agree that a good handyman is hard to find. They are afraid of calling someone they don’t know from the yellow pages or classified ads.   They don’t want to be over charged and treated rudely only to end up with shoddy workmanship and an unfinished job.  The handyman industry’s negative reputation has been built by people who charge too little for their work, get overwhelmed by the workload and have no time for good customer service.  Don’t underestimate the opportunity that exists for a professional handyman with integrity.

You can charge more than your competition if you build your business based on referrals from satisfied customers.  A prospective customer calling you out of the blue will usually ask first about your rates.  You’ll need to do a lot of sales work to build your value in their eyes before moving on to discussing rates.  If you don’t, you’ll simply be in a bidding war with the other handymen listed in the phone book.

So which customer will pay you the highest rate?  Ironically it is the customer who was referred to you.  Your value went up the minute they received your business card from a friend.   They will pay your rate, even if it is higher than the competition because they are confident that they are hiring a proven handyman.  Now it is your job to earn the money!   Building your referral network is the final key to earning top dollar for your services.

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