1 job, 10 applications, 1 hour!

[hakrjak]

I just posted a general construction / labor job my craigslist to recruit a couple guys to work on my next flip project which should start next week. The ad has now been online for little over an hour, and I already have had 10 calls from 10 very qualified candidates who have an abundance of experience, all willing to work for $10 an hour.

Wow... There is a serious ABUNDANCE of cheap labor out there right now due to this economy!!!! How can a guy like me exploit this for big profits, and to put more people to work? I love the idea of stimulating the local economy.

Cheers,

- Hakrjak

 

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[Russ H]

Hak-

For the past few months, we've been hiring amazing contractors for about half of what they were billing out a few years ago-- even less in some cases.

Examples:

$31K -Drywall entire 9000 sq ft building (remodel, so lots of patches, but lots of open walls)
$16K -HVAC system for bldg (2-100K BTU furnaces, 2 5-ton AC units, and 16 zones.
$2.5K-Roofing repairs for HUGE (85' x 38' 6/12) roof
$17K -All new wiring for 9000 sq ft (incl 15 bathrooms)

. . . and on and on.

All in all, a great time to hire contractors, if you have the money and need some work done!

-Russ H.

Disclaimer: These are Northern CA prices--which are easily double anywhere else in the US-- so just cut the above numbers in half to get a comparable local price.

 

[hakrjak]

I only wish I had more work for them to do!

I'd start a landscaping company or flooring company or something like that, but I'm not sure we'd be able to be a success in this down economy.

Cheers,

- Hakrjak

 

[Michael W.]

I only wish I had more work for them to do!

I'd start a landscaping company or flooring company or something like that, but I'm not sure we'd be able to be a success in this down economy.

Cheers,

- Hakrjak

Precisely what I am doing. I've started a floor cleaning company with a couple of friends who happen to be in the service side of the industry. My FIL has actually sold his service company 2 times and which has given me insight into the industry, if you can call it that. It's full of mom and pop type companies that do not market or brand they're companies. I am currently trying to fastlane the concept so I can enter different markets faster.

Think about it, its a low capital entry and labor is CHEAP. I imagine expanding into janitorial services after the first year and eventually landscaping.

 

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[hakrjak]

Good idea.... Yeh, something low investment to start up could be great. I could buy a use pickup truck for $5k probably, and load it up with a lawn mower, edger, leaf blower, etc -- And have income from it almost immediately.

Cheers,
-Carl

 

[hatterasguy]

Its sad really. I have a stack of business cards from subs who come up to me on the jobsites looking for work. Their is simply no work out their now, no one is doing much of anything. I feel bad for them and wish I could give them work, but were not that busy now either.

I had a very nice electrician speed down from his house which was 30 minutes away, because his daughter lives next to my project and called him when she saw the foundation going in!


On one hand you want to beat them up to get stuff done cheaper, and we do. OTOH you don't want to beat them down to much because you could lose good ones, and when the economy comes back they will leave. Its a fine line.

I beat the window supply guy down a few hundred bucks over lunch last week. He was like prices shouldn't have gone up much since last year; I was like I'm sure they went down because no one is building anything. When I got the quote I noticed it was $300 less than last year.:coffee:

 

[HCBailly]

I’ve also heard that scams are on the rise lately because of the economy. People are so desperate for good deals that they won’t question why it’s so good.

For example, in my industry (carpet cleaning), there are guys out there who advertise $4.95 per room (or some other ridiculously low price). Then, in fine print, they say that pre-treater (the soap) costs extra. When you add it all up, they charge just as much, if not more than the other guys.

What I have found is that while people are obviously looking for good deals, simply advertising that probably won’t get your foot in the door. I tried some marketing in my area over the last few months, got enough hits to pay for itself, but it really made little impact on my business, overall. At least in my business, people will call when they’re ready, regardless of what price I’m charging, as long as I’m in the ballpark. So far, I’m still doing okay, and things are really looking up now.

Conclusion: In my experience, most people are still willing to pay 15-25% more if they are ready to buy, and they believe that I am significantly better than my competition. Being a good salesman, targeting the right people, and carrying myself in an honest way help immensely too, of course.

 

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[Fermovian]

I was doing some gardening at the townhouse complex I work at and a guy asked if I was hiring. I live in B.C. and the economy is supposedly booming because of the olympics, but it seems like a lot of people are looking for work. It's getting hard for me to find a full time job, with all the unemployed people I have to compete with. I wish I had a business right now; it would be realtively easy to get workers.

 

[msa1]

As a contractor and an investor, i'd like to add how great it is being a contractor during a recession. Everything we have to buy to support our families costs half as much as all the things you non-contracting suckers have to buy.

I can find cheap labor all day, but I have a conscience. You're not going to get rich working for me but you wont starve either.

 

[kwerner]

As a contractor and an investor, i'd like to add how great it is being a contractor during a recession. Everything we have to buy to support our families costs half as much as all the things you non-contracting suckers have to buy.

Care to share the "how to's" of getting contractor discounts with us suckers?

Specifically - where the best savings are, what materials, businesses that offer discounts, etc.

 

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[Otter]

we are pretty good friend with our contractor and the same job he quoted us last year for $8000,he did this year for $5000,I dont think he was trying to robb us last year just different set of circumstances.

 

[hatterasguy]

Our HVAC guys are down $3k this year on last years prices.

As I said above though we are not pushing the good ones to hard. Some contracters are harder to replace. Our framer is worth every cent, you can give him a project and go on vacation and its done; zero BS. He would be pretty hard to replace so were not pushing to hard.

 

[china]

While cheap labor sounds really good in the near-term, it's very bad in the long term.

When people make less money, they can only afford to buy properties at less money. If the former $20 an hour worker only makes $10 an hour now, he can only afford a $10 an hour house.

This is what deflation is all about.

 

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[BryanC]

You're not kidding. Right now is definitely the time to be using labor as leverage for profit. If you can find the demand to fill and there is the cashflow potential, I say more power to you.

The next few years could be a true era of Human Intellectual Development, renaissance, and especially a period to be remembered for Entrepreneurship. The next few years, we're in for some major economic developments, exciting events, more bankruptcies, derivative crisis and on and on... For laborers especially, it's going to be difficult.

The trend of devaluing a human being's labor is definitely NOT one to joke about and it's going to be a major crisis in the coming future as more and more people realize their labor has no purchasing power. For the common man punching a clock and filing W2's it's going to be an excruciating transition.

The more I think about this element, and the insanity it's going to cause when the working class has this revelation. The more I really want to get a way from an organized society! I mean, think about it. The veneer of society is paper thin. We all intuitively know it's held together on speculative paper. What's going to happen when the chickens come home to roose?

I think you'll be alright if you've intelligently preserved your purchasing power but, what is to happen when more people can't access BASIC resources with their trade, labor, and skills?

Then again, there is also some excitement because if you can see what is going on you can see the caterpillar's cocoon is fading.

 

[randallg99]

part time personal assistants used to be compensated about $18 per hour. but today, I am able to pay a couple of different ones $11 per hour.

another note- bartering used to be very prevelant (for everything: from landscaping, to auto repairs to bldg repairs, etc) but these days money/cash is by far an overwhelming preferred choice

 

[msa1]

Sorry, I was being a little facetious. This is a real sore spot for me. As a contractor i've spent a good part of this year getting blown out of the water by people willing to work for free. Everyone thinks that because were in recession they can "get us real cheap".

My point was that I still have bills to pay and the quality of my work comes with a price. If you want a hack job, i'd be happy to cut my price but I dont want to hear it when you get what you pay for.

 

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[CashFlowDepot]

You really don't want to pay by the hour on rehab jobs!!

Even at $10 an hour, it could turn out to be the most expensive project you're ever done because they will make the job last as long as possible to keep a paycheck coming in. How do you spell S-L-O-W work?!

It is always better to pay by the job and have an agreed to date when the project will be complete. If it's not done on time, I start knocking $50 per day off their payday.

Do not pay for more than 1/4 of the project up front. When it is complete, they get the most of the rest. But I like to hold out making the final payment until after my inspector has come to take a look. If you pay them all that they bid then find a problem a week ot two later, you'll never get them back on the job site. Then you'll end up having to pay someone else to fix the problems - and it will cost you even more.

I prefer to buy materials myself and get them delivered to the job site. Then I "know" for sure what the materials cost ( no mark ups and no added items like a ladder or tool belt or lawn mower that you never see). The other advantage in this is you can put the materials on a credit card and pay it off in full when you sell the house -- float.

It's a lot better than having to come up with ( or borrow hard money) for labor and materials.

Jackie