Open or Closed?

Waterboy

New member
I am at a crossroad.

Starting business here in a couple weeks (I am waiting for funds from a second mortgage). Had a game plan of starting out of small Nissan with topper. 2 cold pw'ers : 1-4gpm 4000psi and 1-2.5gpm 2500psi as a back up (not home depot) 1600.00. 200ft of 3/8th hose and chem mix from Rowlett’s web page for house washing. Very small.

I have gotten the necessary insurance, license, business phone, cards, forms, shirts, magnets, ladders and capital for advertising. I am almost ready to GO.:cool:

Not knowing truly what kind of income I will be able to generate I do not want to sink everything I have into equipment or setup. Ex. 6-7 thousand for a rig.

I did however come across an open trailer with 100gal tank, reel, 50ft of 3/8th hose and 4gpm 3500psi Honda for 2995.00.

Got me thinking that it would be nice to have tank and reel. I feel it would also look more professional. I am concerned about an open trailer vs. closed due to weather and theft. (would be in garage at night)

This trailer would cost me 1845.00
Same size closed would be 1000.00 b4 tank and reel

Reading back I think I gave to much info, just wanted to list all the variables.

I guess I would like to know as well if this is a good deal or not. Wanting to find out if you guys could go back to your start and let me know what you would do if you had it to do over in the way of setup. (hot water excluded)

Thanks for any help
 
Here are two questions I would ask:

1) What type of cleaning are you going to do? If you say"Anything", pack it up right now and save yourself a lot of money!

2) Have you taken the time to write a business plan to find out what needs your community has, how you can help address them, what competition you'll face, and what rates you can charge for your services and how much you will bill out on a yearly basis?

After you answer these two, ask yourself if this is enough of a business to sustain your expectations or needs in terms of income. I deal with a lot of people that are satisfied with $30-40,000 year, but I also deal with a lot of people that would not accept anything less than $100,000. Obviously one takes a lot more work than the other.

Equipment should not be your first concern.
 
Be really careful about how much weight that Nissan can safely tow and bring to a stop. A 100 gallon tank of water is roughly 850 by itself. Then add the washer, hose, reel, and the weight of the trailer itself.

I bet you could get that trailer cheaper.......shop around (on the net) to see what others are charging for similar equipment. Arm yourself with that information, then maybe you can get it for less.

Enclosed trailer would be nice, keep your equipment dry, and can act as a billboard...............but, being in Florida, and since you have a garage, an open trailer would do just fine.

Keep as much of your money as you can.......you'd be amazed how fast a new business can chew thru working capital.
 
The one thing I would do differently if I were starting my business today would be to lease my equipment. I started out of the back of truck (with lic & ins) then bought a trailer, adding eqipment as I went.

That worked OK, but having it all neatly packaged and looking professional, would have been SOOOOO much better. I am paying about $400/mo. for the rig in my next post.
 
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John-Thanks for reply

1) Residential: Roof's - Exterior Walls - Pool Decks - Gutters - Driveways. I am staying away from wood for now.

2) Got a business plan and the need is there right now (seasonal).

Competition is around 3-4 guys dedicated to full time PW but focus more on Commercial (one I talked to and told him I will throw anything big his way). Possible 10-15 companies that are either part time or painters that do it on the side. You live in Florida John. The customer is lucky if a Florida work shows up at the door.

At this time I am going to stick to my PW guns on price and not worry what the other guy is charging. If I am eating Ramen noodles in 3 months then I might need to rethink things. Following Delco's guide for the services I am going to offer.

Not sure what "how much am I going to bill out" means. If it's how much am I going to let into accts receivable then the answer would be ZERO. Cst pays when service is rendered. If it means over head then got that figure.

For me to project what number I am going to have at end of year would be impossible. I would be happy with 50,000. I can live on less but that is the number I will be looking for. I still am keeping PT job just incase.

Mike-Ya I am concerned about the truck not being enough, thanks for the weight of the tank. That will help a lot. Would the equipment be ok if it started to rain in an open trailer? I could use a tarp I suppose but during rainy season I think this could be a pain.

You said this price of 2995.00 is too high. It's the only one I have found below 6000.00. Any Ideas on where to look.

I think what I would really like is to buy enclosed with 50gal tank where hose is mounted to wall with a plate that as a lid like a gas tank and a quick connect underneath lid. Just run hose from house to quick connect. Only thing is I couldn't see tank on enclosed trailer.

John Or-Thanks for Pic. Looks real nice. Is that your leased PW? Are you leasing to own? What are the specs? I think small truck could handle it.
 
Robert:

What I meant by "bill out" was what are your projected sales? As part of your business plan you should have put together a budget that should include this.

In your budget, you should have goals or expectations for your projected sales in each of the categories you mentioned: Roof's - Exterior Walls - Pool Decks - Gutters - Driveways. Your budget is your plan for how many roofs, walls, decks, etc that you are going to in each particular month and how much you will charge on average for each. Your budget should also detail all of your expected expenses by month.

If you do it right, you should be able to project how much you will end up with at the end of each year. Obviously, it will need to be revised as you progress, but the budget gives you a target for your sales and your expenses. A proper budget will help you make sure that your expenses are in line with your sales in terms of percentages. It will help you manage your cash flow and it will help you evaluate your business and plan for future growth and improvement.

If you need help, let me know and I will be happy to send you an excel spreadsheet that we use. It details every item of income and expense.

How much money you will net at the end of the year should not be a surprise - it should be a plan.
 
waterboy

the funny thing about WHAT you want to wash is "wood would have been what i would have suggest".
No tank
no trailer
no hose reel
Home depot's best wash unit $1000
Go to www.deckguide.com
to get some knowalge.
Buy Greg's products
Start out with pump up sprayer's
for applying your chem.
Use your PW to do the cleaning
Apply your finnish/sealer with pads and brush's.
Buy better tools as you go to make things faster and easyer.
Dont let wood scare you.
You mention driveways and pool decks.
You simply cant make money doing these without a surface cleaner. It just takes too long.
Well that's my 2 cent's worth.
 
I'd have to agree with the above..........however, it would require alot of research on your part. Deckguide is an excellent place to start.

It's been a while since I shopped for power washers........that was just my first impression.


If you have good credit, leasing would be a great option, would leave money for other things............but make sure you leave some cash aside to make the payment in the winter when you're not making as much money.

I leased my trailer for three years, with a 10% buyout. The payment was about $500 a month.......and was paid off last year (thankfully).
 

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Robert,

Yup, that's my leased rig. 12 volt HydroTek, 16 hp B&S, 4000/4gpm, 200 deg, 200 gal tank. 1000 lb empty weight.

While I don't leave it out in the rain, it doesn't mind getting wet. Due to its small size, I am able to park in in my garage and still have room to move around. I do not - as a rule - travel with water. I use the tank for advertizing (several per month) and as a buffer for customers that don't have 4 gpm coming from their hosebibs.

My lease payment includes taxes and some other stuff, without that, it would be about $360. 2 yr, 10% buyout - in other words, I paid 10% down. If I want to buy the rig at the end of the lease, they keep the 10% - or you give them the rig back. Leasing allows me to deduct 100% of the payments, rather than amortizing over X years.

P.S. I also bought the extended warranty for $500 that cover anything that might do wrong during the lease - including wear-out items. (I do have a back-up machine...due to Murphy's Law.)
 
I agree that the rig you mentioned seems high. You should be able to find an open trailer than can handle a 100 gallon tank and equipment for a few hundred dollars, and that just leaves you needing the equipment. You can get a 4gpm 3600 PSI machine at home depot for $1000.00 that comes with a short hose, a hose reel for $100.00 or so, and a tank for another $250.00 or less. You should be able to put together a rig like what you mentioned for less than $2000.00, including another 150 feet of hose.

Is this rig used? if so, it is even more overpriced than I thought. With you being in Florida, especially your area, you should be able to find a used open bed trailer that your truck can handle with no problem. If you wanted a small enclosed trailer you should be able to find that for around $1000.00...so for the same money, $3k, you could put together an enclosed rig with the same equipment you're proposing.
 
What are the size of these trailers? I started with a 6 x 12 enclosed trailer. It was just a single axle. Found out that it was too small for me. I went to an open 7.5 x 16 trailer. I wne from 72 sq. ft to 120 sq. ft. It is a double axle trailer woth a fold down gate in the back. There is a major distribitor of trailers near me. I bought my open trailer brand new for $2000. I added on a top ladder rack to it which is nice for holding laddrers and my extension wands. I can also use it to haul my scaffolding if I need it. I rarely use scaffolding for anything though. I would suggest not even wasting your money on a 2.5 gpm machine. It would be ok if given to you for free but to go out and pay for it would not be a good idea. I would also suggest that when you look into buying hose reels that you get one that can hold 300 feet. The reason for that is if you ever go to hot water your machine is going to stay on your trailer and then you will be using a lot more hose. I would rather have one 300' reel then 2 - 150's. I never like to take my machine off the trailer. But if you are using a supply tank then your machine will have to stay on the trailer and you will be using more the 100' of hose. I run a supply line into my tank and unreel my high psi hose. I carry 3 machines with me. Two I have their bypass hooked into my supply tank and the other one I leave the way it came in case I need to take it off the trailer. Them I don't have to mess with reconnecting the bypass lines. When you start talking about going with tanks 50 or even 100 gallons is awful small. I use a 500 gallon tank. If you are using a 4 gpm machine you will drain a 100 gallon tank in 25 minutes. If you have a standard hose going to an already full tank it might work. I have a 5.5 gpm machine and 2 - 4 gpm machines. I need a lot of water in case someone does not have enough to feed my pw'er. I also like to have tanks in case I have to go away form where they have city water. Then I tell them I charge extra for having to haul water. You do need a full size truck to haul 500 gallons of water. Remember that Delco's guide is not what they may be charging in your area. I have found that near me I can get much higher then those prices.
Here are some things you need to consider when trying to figure out how much you should make.
#1 Your salary(how much do you want to make).
#2 Your payroll tax.
#3 Money you may want to put aside for retirement.
#4 Accounting expenses
#5 Advertising
#6 Equipment depreciation
#7 Equipment replacement
#8 Dues( any pw'ing groups you may pay dues too)
#9 Entertainment(do you take a client out for dinner or send a thank you gift etc)
#10 Insurance(buiness and medical)
#11 Intrest you are paying on laons for your business
#12 Licenses business, contractors etc.
#13 Maintenance on equipment and truck
#14 Office supplies(your estimate sheets reciepts etc.)
#15 Rent and Utilites(if working form a shop)
#16 Repairs to equipment(different then maintence)
#17 Telephone(cell, business, fax)
#18 Shop Supplies(if you have a shop)
#19 Travel(do you go to convetions or meetings)
#20 Uniforms
These are most of your indirect costs. You also have to remember your direct costs.
#1 Your washing labor salary
#2 Payroll taxes for you
#3 Washing materials(chems)
I know that there are two slaries on there. One for direct costs and one for indirect costs. Your washing salary is obvious. Your owners salary is paying you for all your time spent on your business when you are not actually washing. Such as mixing chems, bidding jobs, doing paperwork, doing research such as this board, shopping for supplies, hanging up flyers, going door to door, talking with other business owners, etc. All that counts. I once thought I had no overhead either. It adds up quick. On top of all this you also need to figure in that after all expenses are paid and your salary is paid your company needs to turn a profit. I once thought that what ever is left at the end of the year is mine. You can't do that. Your company is not you. Although you own it, it is it's own entity. Just like you pay yourself a salary you need to pay the company it's own salary too. To some people this sounds crazy. You need to turn a profit. I used to be the guy saying I was just happy paying my bills and getting to do what I love. I realized I was making mediocre money, enough to pay all the bills and take off all winter. I then realized that my company did not make any profit. All the money that was left was my salary and not much was left after I paid all my bills. Your owners salary should be able to cover all your daily living expenses. Then your washing salary should be paying you on top of that. To some that sounds greedy but you are a business owner. Pay yourself as one. I know that for all my daily expneses to be paid, my washing slary to be paid, and the company to turn a good profit I need to make $84 an hour. I have that figured off of a 1000 hour year. That means 1000 billable hours. I can't bill for mixing chems and doing paperwork. That is why my $ per hour must be higher. It has to make up for all the time not actually spent washing. I know I need $84 per hour. If the other guy in town charges $40 an hour and I lower to his prices I will go out of business. I need to stick by my own prices. Alot of $ per hour is how fast you can do the job. The faster you are the more work you can do in a year. I have found out that I have been charging the right prices for most stuff I was just taking too long. That was mostly due to having the wrong chems. There is a lot ot this business if you are taking it on full time. I suggest to most people to start out part time and see how it goes. Equipment can be expensive once you get rolling. With my truck and all equipment and trailers I am at about $27,000. Don't be so quick to throw big jobs to the big guys. Those are where the money is at. I did a school last year for $14,000. I just about past it up because it intimadated me. I ended up spending 4 weeks on it but have since realized things I could have done to trim a week off of that. I made about $90 an hour but could have made around $120 an hour. I didn't have water tanks then and that lost me time since I was running up to 600' of supply hose and wasn't getting proper gpm a minute, that was due to it being new construction and the water wasn't turned on yet to the new part. I had to small of a truck to haul around a construction site and got stuck many times. Too much walking back and forth 600' to turn water on and off. You learn new things every day in this business. I made $90 an hour on that job. I just about gave it away. I am glad I didn't. You will need those big jobs to become successful. If you talk to a lot of these guys on here they will tell you they made most of thier money by getting those big jobs. It is hard to make a lot money washing mobile homes. Commercial work is where the money is. Most everyone wishes they had more of it. If you did a survey here and asked whether people would rather do residential or commercial, most would say commercial. It is hard for me to get my $84 on the residential side. If you want to make more and work less, think about taking some of those big jobs.
 
John- Thanks for the tip on future planning. You got me thinking that I have not invested enough time to really give a definitive answer on where I will be at the end of the fist year and what I expect to make each month. I just know what I need to make ends meet.

This is what is probably causing the knots in my stomach.

I would very much appreciate that spreadsheet. My email is Precisionpowercleaning@comcast.net

Ron P & Mike- I agree that wood is something I am not going to turn down but I have no experience with it.

After I get grounded and am fully comfortable with my equipment setup, chems and technique I will look into it more.

I was going to get a small surface (12") cleaner or water broom Ron. Something small due to space but if I do get a trail open or closed I will have room to use a bigger one.

Mike & John Or- Leasing does look attractive, however, it seems like leasing is more geared for the bigger rigs and due to size of the truck I am starting out with this would be a factor.

The guy selling the rig does offer a 2 year lease option for 150.00 a month but that makes it 3600.00. Way too much. I am trying to locate dealer in my area that would have something smaller and reasonable in price. Internet search gods are not revealing much though.

Mike- Yeah I agree with you. Just looking in same bargain trader I saw his ad I found quit a few trailers both open and closed between 1000 -1500. If I got a decent Honda PW'er would it be easy to take of frame and install on trailer?

Steve- What can I say. You saved a few others and me the 29.95 they want on how to start up a Pressure Washing business. :D I can't thank you enough for all the info. I like the pay the company pay myself salaries. Had not thought of that. I will try to implement it into spreadsheet John is sending me.

Brett- That’s the guy. Thanks for the link to his site. It was not in the bargain trader.

Have you priced him b4? Like Mike said "he seems a little high". I would be interested in getting one barely used though.

Please let me know if you see something in your area. I am about a hour south of you and could jet up there in heartbeat.
 
I wouldn't secure the p/w'er to the trailer if you don't have to. Strap it down if you need to to keep it from moving, but what happens when you get a job where you can't get your trailer into and you don't have enough hose to reach? As long as you're going with a portable machine, keep it portable. There's one job here I'd like to get, but if I do, I'll need to get a portable cold water machine because I can't get my trailer in, and I'd need a good 2000' of hose to reach everywhere I'd need to get.

If you go with a surface cleaner, I'd go with at least a 20", that way you don't work yourself to death.

Check out http://www.northerntool.com/webapp/...alogId=4006970&PHOTOS=on&TEST=Y&categoryId=41 for a decent price ($550.00) on a 20". I wouldn't go any smaller than 16", and I think you can find those for around $350.00 or so. I'm going to have to get one of those also, since my 28" steel eagle is too big for some sidewalks/walkways.
 
Just my two sense

I agree with all the information everyone is providing. But one thing I would point out is.... I made and make my business by going out and getting the business. This is the most important part of my business plan. Time reserved for this is a substantial part of your investment. One thing that I have done is hire a salesperson to do it. This way you can concentrate on the business. If they are any good, you will have more money comming in to keep busy all the time. I pay my sales people 20% of each job they get. This includes thier gas and other expenses. They are sub contractors, so that they can deduct the fuel and other expenses on thier taxes. It's just an idea, but it has dramatically increased my business. And given me time to concentrate on application and book work.
 
If you have enough capital pay cash and don't lease. I leased when I got my machine for only a year with a fair market value buy out (about 10%). Pay cash and be debt free, most of the lease companies have rediculously high intrest rates so if you go with a buy out you paid more than it cost to pay cash. Most people think because a lease is 100% tax deductable that you come out better but you don't. You'll come out just as good owning it and getting the tax break on depreciation. You should beable to deduct the entire amount the first year anyway.
 
leasing

leasing

if it breaks down ...in theory you should just be able to take it back and run out with a replacement.....which if your not technically minded is a plus...myself i like to own what i use...but it is a case of swings and rounderbouts.

paul.
 
WaterBoy,
I know what your going through. I still have not made the step to go full time. I have been doing p/w part time for 5 yrs. now.
I still learn something everytime I do a job. I found that one thing leeds to another so you will be doing wood before you know it.
The one thing I have found is you have to be able to sell. Thats bottom line. Anyone can do the work but not everyone is a people person. You have to be able to talk to a customer and sell your sevice over the next guy. The more you know the better off you will be. Remember, knowledge is power.
Good luck and learn as much as you can.
 
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