Business Advice

Are you a blue collar worker who needs help with a small business idea or wants to branch out on his own? I could fill a small library with the lessons I have learned in 23 years in business. Here is just a sampling. It's here as help for young entrepreneurs and blue collar workers in today's world that want to get ahead. Take a look and let's get started!

FINANCING:

If you are looking for a financial institution that appreciates your business, I strongly recommend you call or visit RTN Federal Credit Union. Headquartered at 600 Main Street in downtown Waltham, they have been serving thousands of members since 1945 with everything from checking accounts and high-rate certificates to mortgages and online banking services. In fact, the Credit Union has played a critical role as my company has grown significantly over the past 10 years. Members may choose to use one of the Credit Union's three convenient full-service public offices in eastern Massachusetts or one of 2,000 credit union offices across the country affiliated through the CU Service Center network. They offer old-fashioned service on state-of-the-art products.

The Fast Way

Get a credit line, a sum of cash from your savings or a loan from family and friends.

Family or friends is a great way to get needed cash to explode your small business.

A teacher at a very, very well known business school told me, “Joe, if you get 14 friends and family to loan you $1,000 each that $14,000”.

Most importantly, whether your business succeeds or fails, you pay all that money back within 3 years with interest. You might need them for the next business venture.

Yes, this is fast but a bit dangerous. As my dad always told me, “Your first million is the hardest, after that you can’t stop it.”

The Slow Way

The slow way is to start a business with very little money. You can truly start up many small businesses with about $350.00 or less, providing you have a car or small truck.

Say you bought one vacuum, a broom and a wash pail. That is the start up costs for a cleaning business. Or, you can borrow the equipment.

Buy one lawn mower and a trimmer and you can start up a lawn care business.

People don’t understand you don’t need $30,000 to start, just a little money and a lot of drive!

This is a much, much safer way to start up a small business. You can do it part-time at first, as I did, then as the word passes around about your good work and you get busier, you can quit your old full-time job and go full-time with your own established business.

I’ve spoken about the fast way and the slow way to get your business off the ground. There are other ways also. Below are a few:

Borrow From The Bank:

You can simply go to a bank and sit down and sell your idea. Be positive, very upbeat and polite to help get a small neighborhood bank to lend money to you.

Use the Equity in your House:

Perhaps you have some equity in your house that you could draw on. I honestly don’t recommend this option but it is done all the time.

Use Your Assets as Collateral:

You can arrange loans from your bank by holding the equipment you lease as the collateral. That is their security for the money they lend to you. If you don’t pay the money back, they get the equipment.

OPM:

Other People’s Money. This is an amazing topic. I could go on all day with this one. I have read about 25 books on money and business. I have been lucky enough to have great mentors in my life. These two old guys I know and loved used to say, “It’s always better to use OPM.”

This was also written in most of the business books I have read. I used to think those old guys were millionaires and they said the same thing those books from very, very educated business professionals would say, “It’s always better to use OPM”

The best part of using banks, friends, and family to obtain money for your business ideas is that if things go wrong, you yourself, have not lost any real money of your own. You can still pay the car and house bills as well as the utilities. In time you can begin to pay back the people their money that is due. YOU MUST PAY BACK.

EMPLOYEE RELATIONS:

New Hires:

When I hire new people I keep a close watch on them to get to know them. I try to find out what their strong points are and what their weak points are. The question I always try to answer is, “Where can I best use this person?”

I have a guy working for me now. His name is Bob. He is one of my best men. He can build or fix anything -- walls, bricks, etc. But he is not the best, yet, at running a crew. Perhaps he never will be able to run his own crew. But, his strong points are outstanding and I’m grateful to have him.

Be Involved With Your Employees:

I have always tried to get close with all my employees and help them in almost every way I can. They are the real beams of strength in any business. Without your employees all you have is equipment…Silent equipment, no emotion.

Whether it is helping them with a memo verifying their employment for a mortgage company or letting them use a company truck to move from one apartment to another, I always extend a hand.

Whenever my men have gotten hurt, my wife and I are at the hospital in no less than thirty minutes to help out. We’ll stay with that person, call their significant other, etc., etc.

Employee Perks:

Let your employees know you appreciate them.

I bought a van for my workers to borrow for trips with their family and friends. I call this the “Courtesy Van”. They love it. They take it up to New York to visit friends.

Another idea is to occasionally give your workers gift certificates to nice restaurants for dinner.

A clothing allowance is also good. Pants and boots. By doing this you’re cultivating a close bond and yet keeping your payroll and the taxes that go with it down.

INSURANCE:

Liability Insurance:

When first starting a business you should at least get a small liability policy in case of injury to anyone around you, your employees or equipment. Both the workmen’s compensation and the liability insurance are based on yearly payroll. If you’re a small crew or a one man company, then your cost will be low – yes you do need it and get it. This is a sue happy world we live in, so along with your labor, materials, van or trucks, you need to include your insurance costs as overhead.

ADVERTISING:

Local Advertising:

Advertising is the engine that pulls your train. People can talk about word of mouth all they want and, yes, it will slowly pass the good word around as well as create some work. But local advertising is the best bet for exploding your business and make people aware of it. You’re better off to pick three local towns or one big town and flood it with your ads.

Repeat advertising is the fast way to get the trust. You need trust. TRUST = SAFETY. Remember, money is a precious thing to all of us. Money plays a major role in people’s lives. If you want to get that job, the person must trust you and your company. Only then will that person hand over one of his most favorite things on this planet……his money.

As you advertise, do so with small newspaper ads, door-to-door flyers, and a big sign on top of you’re van or truck. Don’t just put signs on the doors. A sign on the roof of your truck will make you stand out and look big. In the end you’re trying to achieve TOMA, Top Of Mind Awareness.

When you’ve saturated a community or basically carpet bombed them, you’ll know it is time to back off. NOT stop, but cut back. At least by 75%

Don’t totally disappear. When people started to ask me if I was the Mayor of Newton I realized I had covered the area like a blanket.

JOB COSTING:

The Art of Estimating:

If you are starting up a small business you have to be able to bid each job. This can be very difficult and some of us even call it guestimating.

Here is the way it goes:

Perhaps you are going to paint a house for your very first customer. You need to lkist the materials you are going to be using and identify the labor you will need:

20 gallons of paint

ladder (1 ladder to be rented for 1 week)

2 men, 40 hours each at $9.00/hour (also add 19% to to the per hour figure for each man)

-Leave a little leaway for some problems. There will always be some sort of problem; no job goes totally smooth.

Assuming you can do the job in 1 week, your estimated cost for material, labor and problems is $1,918.30

Now, don’t forget your van’s monthly payment, ($275), the insurance for the van, ($90), Excise taxes, ($35), Repairs, ($600) and gas ($30) as well as the yearly safety sticker.

Your monthly equipment cost total comes to $1,030.00, say $25/week.

So your new total is $1943.30

Round that to $2,100.00 to be very safe.

Now what do you want to earn for your week’s work? Not to mention the paper work and phone calls at night, the many errands and things you’ll run up against. Of course it depends on your personal situation and lifestyle and your location. All these things will play a role in this figure.

Now, if your men will each earn $300 for 1 week I should get at least $1500 for a week’s work. You also have to ask around and learn what prices other contractors are charging. You should stay a bit lower to help promote your business.

So this jobs total bid to paint the house will be $3,600.

SALES:

Delivering the Proposal:

Once you’ve done your job cost estimate, your next step is to deliver the proposal.

Meet the homeowner.

Give them a written proposal as well as a 100% guarantee.

Talk with them.

Sell yourself.

Be on time and for the most part, be neat and clean…especially your van.

FIRST IMPRESSIONS ARE VERY IMPORTANT

Put together a reference sheet of others you have done work for. Names and addresses and phone numbers, (Get the “okay” from everyone you put on the reference sheet. Some people may not like it.)

Give your customer about a week and then call him back.

Just introduce yourself and ask about the status, A simple, “Hello, I met you about the painting job. Do I have a chance of getting the job?” is a great start.

..and you’re on your way!!

ADVANCING YOUR COMPANY

How I Pushed My Company From $1 Million to Almost $2 Million in Sales.

In the winter of 2000 my young child Heather passed away very young, just 6 weeks old. Devastated beyond anything I had ever been through before, I knew for me and my wife and my other kids, I had to keep moving forward. I had to get through it. One thing that I did to help me was to read and read and read. I would drive back and forth to Barnes and Nobles buying every business book I could find. I thought I could both gain knowledge and keep myself occupied.

I bought books by all the big winners; Home Depot, Dunkin Donuts and Richard Allen, multi streams of income. The best book I read was Rich Dad Poor Dad by Robert Kowski. Now every time he comes out with a new book I drive over to Barnes and Noble and buy it.

Why am I reading these books? I want to gain their expertise and their insight. What do these high profile people all have in common? This is what I learned.

They all say to teat your employees as best as you can.

Don’t be afraid to jump out and borrow and expand your business.

Work your tail off night and day.

When I felt a bit lost trying to understand what I was reading, I didn’t take it personally.

I would tell myself to just take in what you understand and leave the rest. Because next year I would understand more, and six months later, even more, and so on. I remember watching C.N.B.C. and other financial shows in early 2000 and thinking to myself, “Joe, you’re only getting about 15% of this, but four months from now you’ll understand 25% and so on.”

People take things too serious and judge themselves too harshly. Loosen up and get the big picture and have the guts and the drive to step out on that entreprenuel highway and put the pedal to the metal. GO FOR IT!!!

Contact me if you need help with a small business idea or need information about how blue collar workers in today's world can rewrite the rules to success. Help for young entrepreneurs is right here at bluecollarandproudofit.com

A MEMO FROM JOE

As I approach my fourth year of this website I am very grateful for your positive response. Most of all I wanted kids and young adults to feel normal and I think I have accomplished that.

Also, as people read my story and see me in the media spotlight as well as speaking at student and parent groups, I am continually asked about the daily activities being an entrepreneur and running a business. It sounds so exciting, being your own boss and having your own company, Please remember, it can be fun and enjoyable but also it can be “Hell on Wheels”. I mean a stomach -hurting, stay-awake-at-night experience.

I did a bankruptcy in 1991, lost my house and trucks, etc. Then I had a long run of smooth sailing and growth until 9/11/2001. I have been in the restructuring mode ever since. It’s been lots of equipment payments, less and less snow to plow and business adjustments as they come and go.

This is no picnic. I can get behind on truck payments, loans, debt services and occasionally, even my payroll. But, I keep going. My phone keeps ringing with requests for work. Sometimes I get 45 calls per day. I have built a killer brand. And, yes, if I could do it over, I would have done things a lot differently. But the truth is, I love this. I love the chaos, the thrill, the ups and downs of capitalism and most of all, I love America!

Joe Lamacchia
26 years in business


P.S. How’s that for honesty?