Question for the Self-Employed

Gents,

Maybe I am having a run of it lately but what are your thoughts on this one? The single biggest problem affecting my income at present is delayed starts on projects. I've had three of them this year so far.

When the jobs were quoted and the contracts accepted I we had clear-cut time-slots for each project. ie

In the Beginning there was a Plan.

Reality = Planshottohellandback.

Problem is that for the one man wallpapering operation that I am this means whole weeks on end when I haven't been able to invoice any chargeable time, and now come June when all three projects want to be done at once, there aren't enough hours in the day to get them all done. In fact I so stressed these last two weeks I'm having trouble concentrating and I keep making posts to PLCS.net instead of working 25 hours a day I should be.

The problem is that my clients don't seem willing to offer fixed timeslots for projects, (which is fair enough, they get mucked around too) but no matter how good the plan looks ahead of time, it never wants to work that way in the real world. So far the result is that I'm at least 20% down on income for the first six months of this year, but at the same time I'm utterly browned off working late nights and weekends.

Just telling the client that I'll get round to it in a week or two doesn't cut it, (no matter how late THEY are), you HAVE to be here yesterday because the project is now costing big time in financials and until you make it go, it makes no dough. As we all know the automation dude is always the last man standing on most projects, and yet everyone else's schedule slips and ****ups impact directly on our time and costs.

OK hard heads out there...how do you guys handle this kind of thing?

Drop your full time "part-time" job and get a salaried Full Time job.
I tried the single man army co. as well. It just does not fill every persons expectations. If you have real substantial contracts, well that is something different.

I dreamed about small HMI jobs, retrofits...fast $100/hr jobs......
In reality, the cost of your labour lost is what it is really all about.
Add up the wasted time, and I think you will find more than your "20percent". It was more like 40-60 percent in my business.
Automation Techs get paid fairly reasonably. Look for a full time job and be prepared to actually go home at night.

Good luck and Cheers my fellow PLC dude.

I hit this all the time. It may be some consolation to know that as your business grows and stabilizes the delays get to be less of a problem. When you have a number of projects going at once the delays on projects cancel each other out, and they all kind of shift back in line.

I have found two tactics that help a little. First, I send out a check list that identifies the tasks that need to be complete before I show up, and I require that they be filled out and returned to me before I make the trip. They aren't accurately filled out of course, but if the contractor is grossly incomplete I have the leverage to charge him extra $$ for the extra trips. I also set up the payment schedule so that I must be paid for 90% of the project before I will schedule the trips, with the 10% retainage held by the contractor until start-up and training are complete. If the contractor is past due my terms and conditions allow me to insist on the full 100% before I schedule the trip.

Second, I have a firm "the first firmly scheduled trip gets priority" rule, and I state in my proposals that at least two weeks notice is required prior to any start-up. That usually lets me avoid some last minute juggling. I have also found that telling the contractors point blank "You are behind our agreed schedule, and I have made other commitments for the time you want me on site" is actually quite effective, especially since at that point they don't have any choice. Don't worry about upsetting them and loosing future business - they know when they screw up, and most people can be reasonable if you are firm but not confrontational. They also respect the fact that if you are busy it is because you are good at your job.

instead of being a one-man outfit, why not sub-contract out some of the work...this seems to be pretty popular around here anyway.

Project delays

Quoted jobs need at least 10% added just to cover schedule slippage, and ALL changes, no matter how small, must be documented and charged at an extreme rate.

Most of the jobs we do require a downtime on the machines and are scheduled. If there is a conflict between 2 customers and one customer was delayed, it goes to the customer who's timeslot was scheduled. Most customers understand this and will work with you.
Make sure on your quotes, you recieve at least 50% down payment and any startup is billed on an hourly basis.

Also as your company gets bigger and you hire or take on a partner, it becomes easier to juggle this type of situation.

As for your cost in development and materials, do a progressive billing scheduale. Bill for your invested time & materials as the job progresses. For example when the materials are ready for the install, bill for the equipmnet. In many cases some owners wont pay for the materials unless they have been stored on the jobsite. We typically bill monthly for what's been compleated, or redied so far.

Simply break the job down into various components. For example on a project that might be worth $5,000.00 total.

1. Controller Panel: $1,200.00
2. Jobsite mobilization: $800.00
3. Installiation: $2,000.00
4. Testing and approval inspection: $1,000.00

Total = $5,000.00

In the US the standard contracts ususally provide for a 10% retention on each billing. The retention is paid when the job is compleated.

I too am a one man show and have a similar problem. Right now I have six projects that all need to be done immediately. One was scheduled for the beginning of February, another the end of February, another end of March, two for beginning of June and the others were last minute, "high priority" jobs.

How do I handle it? The first one to call and schedule my time wins. If another customer calls at that time, I do as a previous post suggested, and tell them they are behind schedule and I have already booked my time. I then give them the opportunity to schedule me at the next available time.

Scheduled times take priority followed by a first-come, first-served basis. It works out most of the time and I haven't lost any customers yet? (Knock on wood)

you said it

It`s always the same when you`re in business for yourself.
CHICKEN one day and FEATHERS the next!

But i`ve always enjoyed the freedom!

It`s always the same when you`re in business for yourself.
CHICKEN one day and FEATHERS the next!

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Good one! I went for a stroll at midnight after I posted. To some extent I realise this problem goes with the territory. Still it needs to be managed. Thoughtful replies so far....

As someone who employs single man contractors, all I can say is spell out your escape clauses in your offer.
Example:
Offer valid for 30 days
Offer can be withdrawn in writing any time before contract is signed

Also, let them know that you have other jobs on.
We often receive warnings about this, and a few times have had contractors withdraw their offers suddenly as they have too much work on. Unfortunately, some companies will take the hard nosed line on this, but that is another problem.

Tom Jenkins said:

...I also set up the payment schedule so that I must be paid for 90% of the project before I will schedule the trips...

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Wow, and I thought my 80% where more than average!!!

I will only deal with professonals. But there are a darn lot of them out there that get behind schedule

My schedule is semi booked for the next 3 months. If they want to mess it up then they must pay. I am most respectfull of my clients base and it becomes a mutual understanding. If they need me to be flexible I sure can be ... so must be there checkbook

Like Tom said, there is nothing better than having there money in the bank. You will see how flexivle the schedule becomes.

I get 40% with the PO, another 40% before I leave my shop.

I also allways have an ongoing projects that can fill the gaps.

For instance I write Windows apps in VB for recipes handling. I fine tune them and there is allways a patch that need to be fixed.

I also am developing some new ultra-secret stuff. Some of it will make me a Zillionnaire.

I play with my Cat.

So many things to do,

If what you do now does not suite your need for happiness then try and changing it. Step by step. At least you have your destiny in hand. not your boss.

Do not foget that there are good looking oportunities that in the end, when you analyse them, have not been so rewarding. If you would make more money delivering pizzas then you must ask yourself some serious questions (it happened to me)

Until you spread your wings, You'll have no idea how far you can walk.

I'm surprised at how much you guys are getting upfront. Here in NZ progress payments usually occur after the fact. mmm sure would make a difference though. Many thanks for the thoughtful replies.

Not to upset all the independant contractors here, but I thought I would add my 2 cents. I would very rarely hire a contractor that is a 1 man show for anything critical for the reasons stated. I can not have a machine down and him in another part of the country working on something and can't get back to me for a couple of weeks. As for upfront money, I would never pay more than 10% upfront for anything (and then very rarely). I have no problem paying for milestones that are verified, but to pay money without any work to a single person company is very risky to me. To start another part of this, even when I use a small company, this is a very good reason why I require the software. If any passwords are installed, I will not accept.

I would very rarely hire a contractor that is a 1 man show for anything critical for the reasons stated.

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That's fine by me Bruce, just so long as you don't mind paying the higher rates the bigger SI outfits charge.