Outsourcing

Hi,
a few days ago in this forum there was a thread about virtual company.
As almost every one who replyed this post found this idea as interesting as impossible to succeed, I find it also difficult to succeed. But... i have also an idea... and I would be graetfull if you could tell me if it would succeed.
So... the idea is following:
I ground a company, and work for myself. In the begining I work alone(1-2 year(s) ), because I do not have enough money and job to pay my emploees. Untill now it's everything as usual in every other new company. But the point is that I work from a distance(possibly form abroad), I mean I come to the company that gives me the project, only when it's necessery(to discuss condition of a project, to install it or to do something else what needs me to be personally present by my customer).
As at the begining my possibly customers don't know me, and they are not sure if I really can do the project, the price would be lower(about 30-40%) then this from others conventional companies that can also do this project. After I succesfully complete one project, the price for others more serious projects for this customer(for all of new customer it would be still 30-40% cheaper) would be also competitive to other companies(I don't need at the begining a lot of money;-), and I don't have additional costs that a big company has).
What I have are the references from one company in Germany and two professos from the University where I also completed a couple of projects.
What I don't have is the long experience.
As I am a young siemens PLC programmer, but with master diploma, that needs to learn a lot, at the begining, I would focus me on the projects that don't have the high priority for my customer(on such that are mostly done by treinees). Of course the project don't have to be necessarily in siemens' PLC field(also for instance PLCs from other producers, visualisations, AutoCAD drawings, preparation of labor equipment for schools and universities, programming in C/C++, Java, programming of web sites...).
As I live in western Europe I would focus me mostly on the market in Germany and Austria.
I know it would be easier to get a regular job but somehow I find this sort of job more interesting and more flexible as working for somebody.
Thanks for any comments and hints what could I do to succeed, how could I prepare a marketing materials to promote my company, and at last the question for emplyers - why or why not would you give me a project(or maybe somebody has already one for me, then please let me know).

Automatiker:

Many have dreamed of this, but just never gone with their dream, many have done it and lay awake at night wonder why they did. I don’t have a lot advice on this, there are some on here that will and should tell you their experiences, I just wanted to wish you much success.

You need some background, some reference of some work that you have done before. At the end of the day you need to demonstrate that you can do the job better than established companies. I know some people who started working for big companies utilising their training facilities who latter formed their own companies that are doing well. Not easy but can be done.

I understand your point of view, and at some point is something I also want to do. That is to say, work for myself. At the moment, I am just adquiring some experience in another company, that make automation. Here there is a lot of people with a lot more of experience. (And not only in the technical part). I'm trying to lern all that I can.
I'm not sure of what I'll do in the future, and where will I stay. What I'm trying to say, is that I believe, that you can spend a couple of years, in a bigger company to learn the ways, and to achieve some experience that you can also show in the future, without all the economicals and administrative problems.

Just my thought.

Some people have the ability to start out on their own and become successfull but let me give you an idea what is necessary in most cases.
1. Capital; money to live on especially if traveling. There are always purchases to be made for the projects..You may get a cash flow but profits usually take a year or more to see.
2. Insurance: I do not know how it is in Europe but most companies these days require you to have "workmens compensation" and liability to remove them from resposibility if you get injured.
3. Bonded: Many want people to be bonded to protect them in case you are a thief.
4. You will not be working for yourself per se, you will work for customer(s); which means you still have rules, hours, and bosses to conform too.
5. Your hours will not be your own; much of the work will be after hours or weekends, not counting being called in at odd times or hours.
6. MISTAKES can be costly; damage something and you will be held responsible...ie a job that would pay you $500 could cost you $5000. Even if you do replace/repair the damaged item it hurts your reputation.
7. (See 4). When not "working" you will need to be doing paperwork and/or looking for "work", this can involve an indeterminate amount of hours. It is a myth that you get to set your own hours.

That said, you never know until you try, everyone has a different background/abilites so where some fail others may succeed. If you do not have a lot of work experience, tools/equipment, and business background then you may want to get a regular job first and "study" what is needed and the business aspect.

Good Luck.

Hi,
thanks for all of your answers.
I realise, that it is not easy to lead own company. Of course I need also some more experience to be able to undertake a realy serious projects. As I know what I am able to do I would choose only such projects, that I could really complete, I am not crazy...ok at least not completely crazy. Than in time I would learn step by step new things.
I'll be gratefull if someone would tell me if you would give me a project to do. If not, why not? or under what condition would you me it give to do?

The major problem that I see with a one man company are as follows:

A company calls because they are brokedown and you are on another assignment. What do you do?

If you are doing autocad drawings and certain types of programming, this may not be a problem.

I would focus me on the projects that don't have the high priority for my customer(on such that are mostly done by treinees).

Trainees make very little money and starting out doing trainee work will not pay the bills unless you live a home.

I think it is best to have a partner. In my company my strengths are in programming while my partners strengths are in the electrical side. We can both cover for each other and have had to many times. We also have the luxury of bouncing ideals off of each other.

Starting your own business has been discussed here many times, do a search here for more advice that other members have posted.
I wish you luck and if you have the determnination, you should succeed.

one of the easiest ways to establish yourself is to sub-contract yourself out to larger firms. While this may not be what you are looking to do, it will give you the experience & a chance to build your reputation...most people here will agree that your reputation is what will carry you the next 30+ years.

Virtual Company

Hi all,

I started that topic and i have not given up that idea till now.
I am happy to see many problems, and i still have to work on this topic, i still have to put in some more time and i "WILL" do it (in whatever manner.

I do not like to give up, It may take time.. but i hate giving up...

May be we all can List down the various Industries that we know well, I mean not the exact customer but application based, e.g. Food, Cement, Steel, Pharma.... etc.

Would like to know the Knowledge base out here with respect to Industry.

I have a long working exp with respect to many control systems and do have people as friends, who can pool in a rich information on various Industry.

Lets also talk with respect to Industry.. can we start as atest case on such topic also.

----
Arc

Automatiker said:

Hi,
thanks for all of your answers.
I realise, that it is not easy to lead own company. Of course I need also some more experience to be able to undertake a realy serious projects. As I know what I am able to do I would choose only such projects, that I could really complete, I am not crazy...ok at least not completely crazy. Than in time I would learn step by step new things.
I'll be gratefull if someone would tell me if you would give me a project to do. If not, why not? or under what condition would you me it give to do?

Click to expand...

That is the problem...you do not get to pick and choose projects. Even the projects that you can do may get pulled from you for a variety of reasons PLUS do not think because you are a one man show you can always underbid others

Just my opinion, but you must have 10 years of experience in specific industry to make any serious $$$$.

For relatively simple things, most places have an in house guy, or someone will struggle their way through it.

If I bring in an outside guy, I will pay $$$$, but I want serious industry experience, not a guy who knows XIC/XIO.

JMO,

Marc

Hi,
CroCop you're wright, to make a real money I need to have a lot of experience. But as I said in my first post I am young without much experience and don't need $$$$$. For me it would be good if at the begining I could have $$. For real money I have to learn a lot, but from the other hand I think that I would much faster learn if I worked on my own. I mean not only things like PLC programming or something techinical, but all that what is somehow related to own business(ie. how to get a projects, how to talk with clients... etc). If I go to a company I am pretty sure I wouldn't have all the task diversity as in my own business.
If we talk about money. In Germany I can earn some money, that is not so much for German but I am not a German and for me it would be something. If I would live abroad it would be cheaper, and if I have to go from time to time to meet with clients it also wouldn't be bad, because I like to travel and I could practice my language.

Stasis that is also what I consider. I want to find some company(s) that would need outsourcing. One I have found already, but the problem is that they do not need me all the time and form this company I can earn only $, I need to find another $ and then it would be ok. After some time I will have more experience and then I will earn not $$ but $$$ then $$$$ then $$$$$ and then...

Mark Buskell
" A company calls because they are brokedown and you are on another assignment. What do you do?"
3 options:
1. I do it, and old project must wait(if it can wait,
as I said I would focus me on long lasting project)
2. I don't do it(I lose a little my reputation, but not exactly, because if I cooperate with someone, they know I work alone and I cannot do everything)
3. I call friends or someone and ask him if he can do it (I know some they would do it), of course he writes a bill and he would be responsible for everything, it would be a beautiful bgining of new cooperation:-D
4. I hope there will not be many such situations.

"I would focus me on the projects that don't have the high priority for my customer(on such that are mostly done by treinees).

Trainees make very little money and starting out doing trainee work will not pay the bills unless you live a home."
They do not earn very little, but they have less experience than me, so I could do the same work quicker then they.

" I think it is best to have a partner." it is a good point, I have to find some but I am not sure if it is better to find a partner and then projects or first a little projects and then in time some reliable partner(partly I have already one that would support me in all ways)

rsdoran
"Insurance: I do not know how it is in Europe but most companies these days require you to have "workmens compensation" and liability to remove them from resposibility if you get injured."
If I work in a company, no matter how it is good to buy a insurance. Either way I have to buy it.

"MISTAKES can be costly; damage something and you will be held responsible...ie a job that would pay you $500 could cost you $5000. Even if you do replace/repair the damaged item it hurts your reputation."
That is the main problem I am afreid of, but if I work for a company I am also responsible for my work.

chrispen:
"You need some background, some reference of some work that you have done before". It's true and I know this, and because of that I asked in this forum if somebody theoretically would give me a project to do in case I have little experience.


Once again HUGE thanks to all of you for your answers and I hope you will write more your opinions to me and my idea.(most of all I appreciate the post why or why not you would cooperate with me).

Automatiker

I don't think that you will get bids just because you are cheap. Reputable companies are more worried about the job being done right than they are about saving a few bucks. I am more on the expensive side (I work for myself), but ultimately my customers saves money because I get the job done right the first time. If they were to receive a quote from you at half price, they just wouldn't take a chance.

I think you should find an in-house job with someone for at least five years before you consider this. You might think you know enough to go on your own right now, but in reality you will spend the next five years finding out how much you don't know.

Thanks S7Guy for the answer. I see that almost everyone says me that it is better to learn some more at the begining, than starting business on my own. I must rethink my idea once again or better twice and then I will decide what to do. It is really important for me to know if I have any chance to succeed. The situation in that I am now will not last forever. And the company for that I am working now, wants me to work as Freiberufler(I have something like my own company, I can write bills and if they have job to do I get it and do it, if they don't have any they don't pay me). I can also get some job to do from a friend of mine. Both offers are from Germany and I thought it would be a good idea to work for both now for ie. 1 year and then to start finding something more. Finding a regular job for foreigners in Germany is not as hard as getting work permision. If I work as a Freiberufler I don't need work permission.

And one question more(I know I am stubborn, but I MUST to know it, even if I do not use it now, then in some time it will be for sure helpful).
What is the best way to promote my company? First of all I have to prepare some brochures what I do. Then I can place it in the web, publicate in some technical magazine, present myself on fairs or...?
Would it be a good idea to send brochures per emails to other companies? If so, is it better to ask them if they have interest in my offer or just wait for their answer?
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S7Guy said:

...Reputable companies are more worried about the job being done right than they are about saving a few bucks...

Click to expand...

That is a nice speach for the Miss America contest but in real life it just isn't so.

The ability to sell will to often tip the scale on the cheap side. Many examples are brought to our view every days in the news and all from what they call reputable companies.

It takes greater wisdom to fight for a the increase in budget in order to have a lower cost of ownership. The cost adding up during the full life cycle of the equipments.

If the work originates from the feild, operation / maintenance, you have a chance that the specifications will includes some degree of "quality" inherent to a well designed system. If it comes from management then the price will have a great incencitive and then a "cheap" system could arrive first in the race for the "purchase order".


What makes a small outfit less expansive is the salary and the dynamism of there imagination. Bigger companies just don't thinck outside the box. Most them people will repeat there safe choice instead of looking for other, maybee newer and better avenues.

Remember the saying "Nobody ever got fired for purchasing an IBM".

How many IBM PCs do you purchase now?