Outsized profits from tiny firms

From Robert

As a former member of a Board of a Condo Association, I think you are a smart man. We had major trouble getting people to do work on our Condominium project, mostly because of the delay in payment and the hassles of dealing with a vascillating condo board.

Most roofers preferred the fast and quick money of new construction and would not even return our calls.

I am sure they are all trying to break into your market now, but you already have the lead there.

Good for you! I only wished we had your phone number when we needed roof repairs!

Find a niche, serve it, make money! The American WAY!!!!!

From Robert

I did the same thing, basically, with my law practice. After years of working at large firms, with all the paperwork and politics, I decided to start my own firm. Like the person in this story, I landed a "large" client who wanted me to take on more work.

So I hired associates, secretaries, paralegals, and bought an office building. I worked 80 hours a week and slowly bled to death. Instead of doing my own work (which I love doing) I was only supervising the work of others. My employees were making more money than I was! And since I was beholden to this one large client, I had to do what they wanted, even if it made me uncomfortable.

I finally reached a point where I said "enough". I laid off everyone and decided to be a solo practitioner.

I make less money now, but don't have to commute, and my ho9me office is a deduction, so I really net more. And since I can offer my services at lower prices, my clients are happier. Since I have fewer clients and cases, I can spend more time on them and do better quality work.

And because of all of this, I don't have to advertise or constantly troll for more clients (like most attorneys have to) – they come to me instead.

BEST OF ALL, I get to choose who my clients are. 10% of your clients can take up 90% of your time, with their demands, phone calls, need for specilized paperwork, etc. Ditch the 10% "problem client" and you CAN make more money with a lot less work.

I've gone form 80 hour weeks to 20 hour weeks. It's that amazing.

Big companies liek Starbucks are nothing but trouble. They want the lowest prices, they want you to jump though hoops for them, and they act like they are doing you the biggest favor in the world by sending you WORK to do.

WORK is not a favor, it is hard and you should get PAID WELL for it.

Like the big law firms, Starbucks is stifled with paperwork and overhead, serves a mediocre product at inflated prices to its customers and gets business because of its status and brand identity.

But once people start looking for real quality, not status, they find the local corner coffee shop has better prices and better product. And the guy pouring your cup owns the joint.

Less can be More. Congratulations to the businessman in this story for figuring it out!

From Paul

I believe to sell your goods, imported or not, you need to be competitively priced. Giant retailers are a very large portion of the problem as they (WalMart) seek the lowest price and not always the best quality. This makes companies go over seas to have products made. This isnt knew and its been going on for 50 years. Remember when "made in Japan" was all over everything. Now there economy boomed off of the US buying power and things from Japan are now very expensive. Stock holders are also to blame. Pepsi just laid off 3,000+ workers, not because their sales went down but because the market went down. This is greed at its finest!

From Mark

First off, no company is paying taxes on goods they are importing. The tax is collected when the goods are sold at retail here in the U.S.

From Anonymous

This article is a great example of going where the money is. I am in the roofing business and I service a very tight niche in the condominium homeowner association market. My business is roof repairs and total roof rehabilitation.

There are very few roofers that will even work on condos. There is a different game to play in the condo market. Most roofers are used to getting paid as soon as a job is done. For me, I usually get paid between 2-4 weeks after job completion.

From Michael – London

This story rings very true for me. I built up a company supplying major chain stores with fashion accessories from the Far East. I built it from nothing to GB£1.3m turnover in four years and in dealing with these big chains I found it was possible to turnover all this money and even make losses some of the time. What's more it created a stressful work environment wherein we never felt in control. After all that I jacked in the whole thing and decided to start over selling better product direct to the public through the internet. High margins, low overheads, high profits – more control = happy life!

From Ivan Garcia

In the produce business we have experienced from practices and then from observing our competition that going into business and distribution with certain grocery store chains is just not worth the headache. Who wants diminished margins, more credits and more distribution expenses? Many people fall for the Walmart trap so easily.

From Mike Lomio, Parsippany, NJ

Following three business principals: only working with profitable customers, selling based on value added solutions rather than price, and achieving productivity through technology can acheive strong results. Outsourcing to local vendors is better than oversees.

From Anonymous

I don't mind outsourcing within the U.S., it's when its done overseas, eroding the tax base, as previous poster points out.

As it is now, it is CHEAPER to outsource than it is to run the entire operation from within the states.

You can purchase goods with TAX, if they are to be used within the United States, but you can purchase them WITHOUT TAX if you use them in Mexico. If you are a business, which one do you choose?

With a large scale operation, you can take away millions of tax dollars doing this.

Then, you make the goods in Mexico or China, then try to sell them back to the U.S. At some point, there is going to be a realization:

(1) The more good-paying jobs that get outsourced, the less we have to pay taxes.

(2) Businesses cheat the tax base, by purchasing goods for use out of country at no tax.

If someone has a story on how NAFTA has positively affected the economy of the United States please tell it to me!

Thanks!

From Zeke Wolfy, Chelmsford,MA

Here is a fresh idea, instead of laying off workers to cut costs, let's outsource executive management. Outside of production, they represent a rather large portion of operating costs. We can get qualified talent in India for a fraction of the cost. Imgainge, not destoying the tax base and saving millions on top of that!
MORONS! try putting out a product that produces a profit, STOP CONCENTRATING ON SOELY CUTTING COSTS; its adding to the downward spiral. These jackass owners of capital are going to have to stop this, probably sooner then later, as there wont be much of a tax base left to draw from.