≡ Menu

Getting Started With The Rich Contractor

Welcome to the Rich Contractor, the ultimate business resource for contractors, service professionals, and those who dream of some day dumping their dead-end job in exchange for the wild world of small business ownership.  Consider yourself lucky, because you’ve just found the playbook that I wish had been available to me when I was getting started.

MY ROUGH START

Around the time of my 30th birthday I decided that it was time to rock the boat, so to speak.  My day job was sucking the life out of me, and the idea of breaking free and starting my own business was the only thing that got me through each workday.  Finally, after years of dreaming about it, I got off my butt and did it.  I started my own home services business.  But it wasn’t a walk in the park.  I was tackling an industry in which I had little experience, and I was clueless about how to get started and how to run the operation.  Searching the internet for answers, I realized that there wasn’t much in the way of helpful information on the web for people like me.  I also noticed that many of the other contractors in my city were just as “lost” as I was when it came to running and marketing a business.

I PERSEVERED

Well, I forged ahead with my new business anyway.  I learned a lot during those first few years and devoted myself to consistent improvement whether it came to marketing, customer service skills, or simply running a more streamlined operation.  As time went on my tenacity and willingness to learn began to pay dividends, and I eventually became one of the most highly-regarded professionals in my chosen niche worldwide.

But it still nagged at me that so many of my new-found friends and peers in the contracting industry were having a difficult time with their business.  I realized that many of them were still as lost as they had been years earlier, and would always struggle financially unless they learned a new way.  I knew that it was time for somebody to step up and develop an online resource that was truly helpful and comprehensive, and since I had some basic web publishing knowledge and the work ethic to see it through I decided that person would be me.

THE RICH CONTRACTOR IS BORN

So I started RichContractor.com towards the end of 2007, my primary goal being to educate, inspire, and empower other contractors and would-be contractors who were eager to succeed but lacked basic business know-how, just as I did years before.  The rest, as they say, is history.  It’s now one of the most authoritative sites in the world on the subject of starting and running a successful contracting or home improvement business.  So how can it help you?

Well, let me point you toward a few different entry doors:

Door #1:  If you want to become a professional contractor but haven’t started yet, first read my epic post about how to become a contractor.

Door #2:  If you’ve already started your business and need help with marketing or getting new business, I would suggest you begin by reading my posts about starting a blog, getting free construction leads, and choosing construction business cards.

Door #3:  Other popular points of entry include my rant about how to make a lot of money and my comprehensive introduction to nailing contractor leads.

Then just keep working your way through the site.  There’s a mountain of information available to you here, so you’d be wise to bookmark the site for later reference.  Well, that’s all for now, folks.  Now go grab a cup of coffee and start reading…it’s time to turn that dream of entrepreneurship into a reality!

{ 0 comments }

This is a guest post from Randal DeHart at FastEasyAccounting.com.

I have been involved with construction beginning in the mid 1960’s as a kid working in the family construction company through the present time.

Over the decades I have gathered and documented a comprehensive list of terms that describe construction. Some of them are meant to bring a smile to your face, some are serious and the rest I hope are simply entertaining.

This Article Contains Definitions That Begin With The Letter “P,Q,R”

PAM – Production / Accounting after checks bounce and letters for back taxes / Marketing word of mouth

Personal Assistant – Someone who works part time with big red “S” on back of their cape (Superman / Superwoman) able to run personal and business errands, answer phones, make deliveries, clean restrooms, take messages, memorize a verbal list of to-do items from contractor without writing any of them down, schedule jobs, listen to customer and staff complaints, babysit children and pets, wipe runny noses, clean up spills, make and serve coffee, pay bills, open the mail, go make bank deposits, work on tiny desk, no air conditioning in summer, limited heat in winter, bad lighting, fix broken computers and printers and do the bookkeeping for multiple companies

Peter Principle In Construction – Promoting a journeyman to Project Manager or working foreman without formal training. Leads to Construction Train Wrecks.

People Dependent Vs. Process Dependent – Construction contractors who insist on getting control of people, employees, vendors, suppliers and stakeholders are like Sisyphus doomed to “Push a heavy rock up a hill for all eternity or until the go out of business. Construction contractors who are process dependent are more likely to enjoy the finer things of life that money and freedom can buy.

Pioneer – Contractor with flaming arrows in the back from asking the bookkeeper for accurate reports

Poor Contractors – Have hundred dollar conversations with their mentors and attend the business round table

Process – System to produce predicable quality results and reap dividends for the owners

Process Development – Do it, Document it, and Delegate it

Professional Contractor – Serious construction business owner with construction strategy and definitely in construction business to earn a worthwhile profit. One of the Four Types Of Contractors

Profit – Cash is a fact and profit is an opinion. One will put a roof over your head, clothes on your body and groceries on the table. The other one will impress your banker. Keep your priorities straight.

Project Manager – The conductor of an orchestra in which every musician is in a different union

Project Management – Combination of skills and construction project software

Purpose Of Your Construction Company – Acquire clients, satisfy their needs and repeat as often as possible to increase cash flow and profits.

QuickBooks For Contractors – Accounting software for construction companies

Rain Maker – The person in the contractors firm that acquires new clients

Real Money – In Construction the real money is made in the office; not in the field.

Remodel Process – Forming (Honeymoon), Storming (demolition), Norming (Rough-In), Performing (Paint)

Retail Bookkeeper – Worked at store somewhere, thinks all accounting is the same, expensive lesson for contractors

Retired – Means you got tired of them, or they got tired of you

Rich – Income exceeds outgo

Right Vs. Rich – Right Vs. Rich is all about giving your customer or client what they want, not what you think is best

ROI – Risk of Incarceration; in most cases the business owner is responsible for unfiled taxes and missed payments, not the bad bookkeeper.

About The Author:

Randal DeHartRandal DeHart, PMP, QPA The Construction Accountant. Randal DeHart, PMP, QPA is the co-founder of Business Consulting And Accounting in Lynnwood Washington and Fast Easy Accounting. He is the leading expert in outsourced construction bookkeeping and accounting services for small construction companies across the USA. He is experienced as a Contractor, Project Management Professional, Construction Accountant, Intuit ProAdvisor, QuickBooks For Contractors Expert and Xero Accounting Specialist and Bill.Com Certified Guru. Visit http://www.fasteasyaccounting.com/ to learn more. Follow Randal on Google+

{ 0 comments }

This is a guest post from Randal DeHart at FastEasyAccounting.com.

I have been involved with construction beginning in the mid 1960’s as a kid working in the family construction company through the present time.

Over the decades I have gathered and documented a comprehensive list of terms that describe construction. Some of them are meant to bring a smile to your face, some are serious and the rest I hope are simply entertaining.

This Article Contains Definitions That Begin With The Letter “M,N,O”

Mastermind Team – BCA Staff and Clients who mentor BCA contractor clients

Makers Vs. Takers – Makers believe it is better to make than to take; whereas Takers believe it is better to take than to make.

MAP – Marketing / Accounting / Production / formula for success

Maximize – The process of building and running your construction business to generate highest possible profits for short run so you can spend it all quickly and go broke. Similar to running your pickup truck on the race track as fast as it will go without proper maintenance so it lasts for about ten hours and 1,000 miles before it is destroyed

Money Is Made – In the office; not in the field. Strategy vs. Tactics

MR>MC – Wherever marginal revenue exceeds marginal cost do the job

Nepotism Is Relative – Construction company owner hires and promotes his relatives who proceed to chase off qualified field technicians and office staff in an effort to level the contractor down and out of business.

No Financial Reports – Driving on the highway, at night, windows blacked out and being surprised by the crash

Non-Construction Accountant – Dim-bulb wanna be bookkeeper without any construction bookkeeping skills trying to jam retail accounting methods into construction accounting

Not Listening – Contractor who gives their clients what the contractor likes not what the client wants

OSHA – A protective coating made by half-baking a mixture of fine print, red tape, split hairs and baloney

Optimize – The process of building and running your construction business to generate normal and economic profits for the long haul and provide you with a substantial income for current living expenses and a comfortable retirement. Similar to running your pickup truck on the roads and highways at normal safe speeds with proper maintenance so it lasts for ten years and 200,000 miles or more

O.P.M. – Other People’s Money! Cash flow and bad bookkeepers are the #1 and #2 reason construction companies go out of business, bankrupt or worse. When doing a construction project do not be the banker! Invoice early and often and get change orders signed.

OSHA – A protective coating made by half-baking a mixture of fine print, red tape, split hairs and baloney

About The Author:

Randal DeHartRandal DeHart, PMP, QPA The Construction Accountant. Randal DeHart, PMP, QPA is the co-founder of Business Consulting And Accounting in Lynnwood Washington and Fast Easy Accounting. He is the leading expert in outsourced construction bookkeeping and accounting services for small construction companies across the USA. He is experienced as a Contractor, Project Management Professional, Construction Accountant, Intuit ProAdvisor, QuickBooks For Contractors Expert and Xero Accounting Specialist and Bill.Com Certified Guru. Visit http://www.fasteasyaccounting.com/ to learn more. Follow Randal on Google+

{ 0 comments }

What Is A Carpenter?

The Merriam-Webster dictionary defines a carpenter as “a person whose job is to make or fix wooden objects or wooden parts of buildings.” But in reality, that only describes a portion of what a carpenter does (and it expands far beyond wood). Carpenters are the masterminds behind pretty much any building, from residential houses to the skyscrapers you see peppering skylines. They ensure walls stand straight, floors are level, and everything is installed properly and up-to-code.

Carpenters mainly construct and repair building frameworks and structures, such as stairways, doorways, partitions, rafters, etc. Common tasks for carpenters include following blueprints set forth by clients; measuring, cutting and shaping materials to fit; installing fixtures like windows and molding; erecting and leveling framework using cranes, rigs and other equipment; mounting cabinets, drywall and siding; and instructing other construction workers.

According to the Department of Labor, employment of carpenters is expected to rise 6 percent in the years leading up to 2024, which is on pace for occupational averages across all industries. This surge will stem from population increases that will cause higher need for new-housing construction (the largest employment sector for carpenters), as well as increasing demand for home and building repair/improvements as the economy continues to recover.

What Does It Take To Become A Carpenter?

Most carpenters complete a 3- to 4-year apprenticeship program to learn the basic skills necessary to become a carpenter, like blueprint-reading, mathematics, building code requirements and safety practices. Unions, contractor associations and even individual contractors may offer their own carpentry apprentice programs, which usually require 144 hours of technical training and 2,200 hours of on-the-job training. Before beginning to work on their own, all carpenters must also pass 10- and 30-hour safety courses administered by the Occupational Safety and Health Administration.

Basic qualifications to begin a carpenter apprenticeship are as follows:

  • At least 18 years of age.
  • High school degree or equivalent.
  • Physical ability to do the work.
  • Pass a substance-abuse screening.

Other important qualities for carpenters to possess include:

  • Business basics: Self-employed carpenters, especially contractors, are required to not only provide carpentry labor, but must also run their business and manage finances. As such, a foundational understanding of business is imperative.
  • Dexterity: Carpentry involves a lot of handiwork and hand-eye coordination in order to complete tasks safely.
  • Management skills: For carpenters who employ a team of other workers, good leadership and delegation traits are a must.
  • Problem-solving: Projects and blueprints may change at any time, so carpenters need to be able to adapt and solve complicated issues as they arise without getting flustered.

While most carpenters choose to enter apprenticeships directly, some start out as assistants to certified carpenters. In addition, carpentry certificates that offer training before an apprenticeship are also available that cover information in eight different carpentry facets, including painting. An example of one such training program is Pre-Apprenticeship Certificate Training, offered by the Home Builders Institute.

What Do Carpenters Do? (Specific Types of Carpenters)

Just like with any other occupation, carpenters may specialize in certain areas of construction. Below are a few of the different types of construction carpenters:

  • Trim carpenters specialize in molding and trim, including doors and windows, mantels, baseboards and other ornamental work.
  • Finish carpenters focus on finishing-touch carpentry, such as cabinetry, furniture-making and woodworking where minimal margins of error are needed.
  • Cabinetmakers, as the name implies, also perform fine and detailed work in the form of making cabinets, wardrobes, dressers, etc.
  • Framers are responsible for the skeletal framework and underlying structure of

For general contractors, a background in carpentry is a lucrative step toward a solid future as a general contractor or remodeling business owner. Carpenters possess the basic (and sometimes advanced) skills contractors need to get their start in the home improvement business. And because carpenters are involved in all phases of construction, they usually have more opportunities for advancement than other workers. If you dream of being your own boss, becoming a carpenter is certainly a good first step toward that goal.

{ 2 comments }

This is a guest contribution from Randal DeHart of FastEasyAccounting.com.

I have been involved with construction beginning in the mid 1960’s as a kid working in the family construction company through the present time.

Over the decades I have gathered and documented a comprehensive list of terms that describe construction. Some of them are meant to bring a smile to your face, some are serious and the rest I hope are simply entertaining.

This Article Contains Definitions That Begin With The Letter “G,H,I,J,K,L”

Green Growing Contractor Vs. Ripe Rotting Contractor – Green growing contractors continue learning, questioning and discerning. Ripe contractors have a hardening of the attitudes, know everything and are rotting. Age is not a factor.

Hard Work – Expressway to Retired

Hustle – The expectation of getting 40 hour of work done in 20 hours

If You Know The Answers The Questions Will Not Bother You – In school when you sat for an exam or a test and you knew the material forwards and backwards it was fast and easy. The exams and tests for the classes you struggled with were the opposite. Having a Business Process Management Plan provided you with the answers for the questions about how to run your business because it is something you developed. Not something someone else did and handed to you.

Income – Working for daily money

Insanity – Hiring and firing cheap in-house bookkeepers over and over and over expecting useful reports

Inexpensive – Goods or services that do work beyond the warranty period

It’s Not What You Know, It’s Not Who You Know That Counts, It’s Who Knows You – The value you bring to your network is directly related to who will take your phone call or return your email

KPI Key Performance Indicators if viewed daily and understood leads to wealth

Lawyer – Person who goes in after the auditors to strip the bodies

Leveling – When two or more people spend time together the group will level to the strongest personality

Listening – Contractor who asks their client what materials and results they want and give it to them

Little Leaks – Sink the construction business because they are easy to ignore like what ten minutes is costing your company

LMOS – The four big cost buckets,  Labor, Material, Other Costs and Subcontractors, used by Fast Easy Accounting to assist construction contractors in determining Job Costing, Job Profitability and Job Costing Services Reports.

Liquidated Damages – A penalty for failing to achieve the impossible

Low Bidder – A contractor who is wondering what he left out

 

About The Author:

Randal DeHartRandal DeHart, PMP, QPA The Construction Accountant. Randal DeHart, PMP, QPA is the co-founder of Business Consulting And Accounting in Lynnwood Washington and Fast Easy Accounting. He is the leading expert in outsourced construction bookkeeping and accounting services for small construction companies across the USA. He is experienced as a Contractor, Project Management Professional, Construction Accountant, Intuit ProAdvisor, QuickBooks For Contractors Expert and Xero Accounting Specialist and Bill.Com Certified Guru. Visit http://www.fasteasyaccounting.com/ to learn more. Follow Randal on Google+

{ 0 comments }

For some people, choosing a checking account for their personal needs can be as simple as going to the nearest branch and signing up. But when it comes to choosing a bank for your business checking account, the search can and should take some thoughtful research and consideration. Even if all you’re looking to do (for now) is deposit/withdraw money, don’t just choose the nearest bank. I’ve seen too many contractors settle for the first bank they come across, only to realize a) the bank’s fees are too high, and/or b) the bank doesn’t offer solutions for their long-term needs. That means they’ve wasted time establishing a history with the bank and are left in the same predicament in which they started.

To help you avoid that situation and find a bank that will be a great long-term partner, here are a few considerations to keep in mind and a look at four banks that offer free business checking accounts:

Why Do You Need a Checking Account?

Before you even start researching banks, you should first consider why your business needs a checking account now. Do you just need a place to manage money transactions? Are you looking for more specialized investment advice? Maybe it’s time to expand your business and you’re looking for an institution that also offers equipment leasing programs or small business loans. No matter your needs, many independent contractors find it’s easier to work with one bank that can accommodate all their needs as opposed to parceling out their business to several different banks. So as you dive into your search for the right bank, keep your list of needs nearby and ensure the bank can help you with all of them.

Don’t limit your horizons to just your current business needs, either. Start planning for the years ahead so you can pinpoint a bank that can grow with you. The time you spend researching now will pay off when you’re able to use the same bank for years to come.

Consider the Costs

As a business owner, every dollar counts. The last thing you need is a bank charging you every month just for having an account with them. Unfortunately, that’s what some of the more money-hungry banks are gravitating toward these days. If you’re not careful, monthly checking account fees can range from $10 to upwards of $50 per month (that’s between $120 – $600 per year).

However, by doing your research ahead of time and being diligent about your banking practices, there are steps you can take to avoid banking fees. For example, some banks offer free business checking accounts as long as you don’t go over a certain number of transactions per month (ranging from 150 transactions to more than 500). Other banks will waive monthly fees if you maintain a minimum balance at all times. To determine if you can meet the minimum requirements, start taking stock of your business’ regular transactions and cash flow now to tally your monthly averages. The last thing you want is to sign up for an account only to find a few months later you’ve been charged monthly fees all along as you haven’t met the minimums.

Side note: Once you’ve chosen your bank and have your checking account in place, be sure to keep track of your transactions and monthly statements. Some banks have been known to tack on fees that may not apply to you, so it’s important to correct any errors as soon as possible.

Regional vs. National Banks

This is a choice that all comes down to your personal preference in dealing with banks. If face-to-face interactions and developing a relationship with your banker(s) is what you’re looking for, a local, community bank may be the way to go. Local institutions may offer more free or lower cost checking accounts and will probably be more willing to work with you in the case of overdrafts or other issues that can arise with your business. However, these small banks may not offer all of the perks of larger institutions. Case-in-point: technology. Many local banks don’t have the resources to develop online banking features or mobile banking apps.

On the other hand, larger banks may have more additional services to offer you as your business grows, and they may be better equipped to loan you money should you ever have the need. Figure out which benefits are most important to you.

Documents You’ll Need to Open a Checking Account

Once you’re ready to open your business checking account, you’ll need to make sure you’ve got a few documents in order first. Banks need to ensure not only you are who you say you are, but that your business is set up properly. Documents you’ll need include:

• Personal identification
• Tax identification number (EIN)
• Doing Business As (DBA) registration (if applicable)
• Articles of Incorporation (if you are an LLC, corporation, etc.)
• Optional: Cash flow estimates (The more specific information you’re able to supply to your bank initially, the better advice they’ll be able to give you.)

For a complete list of application documents needed, contact your bank directly.

Four Of The Best Banks For Free Small Business Checking

Here are just a few of the banks that offer free business checking accounts (I have personal experience with U.S. Bank and found them to be quite impressive):

U.S. Bank Silver Business Package*
• 150 free transactions
• Online & mobile banking and bill pay
• Free first year of overdraft protection

Chase Total Business Checking*
• $10 monthly fee waived if you maintain a daily balance of at least $1,500
• 200 free transactions
• 24/7 access to chase.com and telephone banking

First Citizens Bank Basic Business Checking* (branch locations are not in every state)
• No minimum balance
• No monthly maintenance fee (must be enrolled in e-statements)
• Up to 175 free transactions

BECU Basic Checking*
• No monthly fee
• 50 free transactions
• Online & mobile banking and bill pay

Yes, that last one is a credit union.  Some people won’t even consider this option for some reason, but it’s foolish to not even explore it as a possibility.  Credit union business checking can often times come with outstanding service and benefits (and their rates for loans are often lower than traditional banks, too).

*Please note these lists are not comprehensive. Visit each bank’s website for more information.

{ 2 comments }