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I want to expand my duct cleaning business...but how?
Old 08-04-2008, 12:45 AM   #1
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I want to expand my duct cleaning business...but how?

I've determined that I am operating at a very good level right now, with the market/competition the way it is. I've developed a niche and form of advertising that is very controllable and provides a steady stream of profitable work. Expanding in my locale cant be accomplished without raising my advertising cost greatly, which will result in a much lower net return. Again, my current advertising is very unique, and the ROI is enormous. i also have an automated system that allows me to be notified of online activities on our website anywhere, any time of day....so as people request prices, i call them within minutes to discuss their needs...and it works WELL

SO, I want to expand to another market about 2 hrs from here. My idea (just an idea...im sure there's flaws) is to take on a 'partner' in that area who will buy in with a small cash investment to cover equipment/1st month advertising. I will then implement the advertising method in his area, take the incoming calls, sell the jobs, and help schedule them. The Partner will do the work, buy his own daily supplies, and deposit payments from jobs into a business checking. At the end of the month he'd get his cut, which would be gross sales, minus actual advertising costs, minus approx $75/job I sent him. He would be able to do work above and beyond my leads if desired.

A few potential issues I see....and how can I overcome them?

1)How to the handle customer payments. Do I advise customers that we only take checks made out to xxx company when I sell the job, and hope Partner deposits them weekly as agreed? Do I set up cc/debit card system and have him swipe cards as much as possible (I'd rather avoid this due to fees). etc etc IDEAS?

2)If Partner does work outside of my leads, how should that be handled? I would be fine with him keeping all profits minus a small fee to me for using our name as well as to cover costs of 'farming' this customer for years to come...offers for referral bonus's, friendly reminders, etc- i will be handling all of that

3)A no compete contract definitely seems to be in order....what should be included?

4)In this scenario, does it seem i could treat Partner as sub-contractor for tax reasons?





I'm missing a lot here, and i suspect this post lacks the details i intended it to...as it is 1:30 am and im dead tired.....and im rambling...but any advice/ideas/experiences would be greatly appreciated.

MY 'idea' tells me that if i can replicate my 'system' in another locale, and get 75/job x10 jobs/month...i can profit maybe $7500/yr for minimal work...duplicate these efforts in multiple locations and multiply profits
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Old 08-04-2008, 12:07 PM   #2
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Fed, I'd hire someone to do the work for you in the other town, recognizing that you will still have to supervise the operation. I think your above scenario is just too complicated.
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Old 08-04-2008, 12:44 PM   #3
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..take in laundry before you take in partners.
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Old 08-04-2008, 03:21 PM   #4
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... what they said. A bit over-complicated and partners are not a lot of fun (from experience).

Another option? Create a business manual describing your processes. License it (at a high premium) in areas where you do not operate. Test market via Craigslist (business category). "Duct Cleaning Profits"... or some such.

Backend revenue: Sell leads to licensees.

Bennies for you: Initial up-front payment, annual license renewal, per-lead revenue.

Bennies for licensees: proven system, reduced startup risk, profitable leads.

And perhaps the biggest benefits of all. No partners, no employees.

- Stoop
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Old 08-04-2008, 08:14 PM   #5
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Quote:
Originally Posted by stoopwallace View Post
... what they said. A bit over-complicated and partners are not a lot of fun (from experience).

Another option? Create a business manual describing your processes. License it (at a high premium) in areas where you do not operate. Test market via Craigslist (business category). "Duct Cleaning Profits"... or some such.

Backend revenue: Sell leads to licensees.

Bennies for you: Initial up-front payment, annual license renewal, per-lead revenue.

Bennies for licensees: proven system, reduced startup risk, profitable leads.

And perhaps the biggest benefits of all. No partners, no employees.

- Stoop

this sounds a bit like a franchise...which requires a lot of $$ to get going and a lot more involved legally...unless I'm missing something?
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Old 08-04-2008, 09:46 PM   #6
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Quote:
Originally Posted by thefed View Post
this sounds a bit like a franchise...which requires a lot of $$ to get going and a lot more involved legally...unless I'm missing something?

TheFed:

Apologies... reread my missive and sho-nuff, does sound like franchise. Not what I was getting at. (and like you, I'd avoid headaches and cost of franchising)

By way of example:

Sam Beckford's Successful Studio Strategies
(not affiliated in any way, just a nice example.)

Husband and wife team 'systemize' the dance studio business in a small-ish town in British Columbia, Canada. Open another successful dance studio and now have a very profitable, low risk business profiting in high six figures every year, with time for family and not a lot of headaches (purportedly).

They put all their systems into a seminar format (another option for you?)... and do an annual seminar. Folks who'd like to attend must qualify for eligibility. Only one company per area. $2k seminar fee (I think)... And when you sign up, you keep competitors from getting access to systems/seminar in your market.

That's at least the model I was thinking for you... offer information in manual or seminar format. Offer a single 'license' to each company/location, each year.

And on the backend, allow licensees to buy leads from you.

Not sure if it's a model for you, but might be a rabbit-hole to noodle on.

Best,

- Stoop
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