Starting out!

[JakeASimpson]

I'm hoping to start on my own soon.

I've just come out of my apprenticeship last year, completed 2394/2395.

On JIB rate, not 'approved' yet.

Sick of hearing management saying the lads are getting charged out at £32+ an hour, double on Sundays and triple on bank holidays. Thus making a nice profit earning at the end of the year for them.

Looking at 3-12 months contracts and they are only paying £12-18 an hour.

I'm done the figures and I've worked out I need to charge £25 an hour x 40 hours per week for 35 weeks to earn my salary currently plus paying for an old van, insurance and other misc.

Struggling to see how people find contracts down south, charging £30 an hour plus digs.

Probably no replies, because of potential competition, but if everyone is willing to, any advice would be helpful!

Thanks

 

[binky]

there's a very good reason why management charge £32/hour, it's because we have to to cover the costs of employing people, vans, insurance etc etc and try to make a profit so we can pay ourselves. £12-18 / hour is pretty good rates (we have to add National Insurance and pensions to that cost). I would suggest you aren't really experienced enough to go it alone just yet, and I have to ask where are you going to get any work from? You also have to factor in periods of time not working or doing very little - can you pay your bills during these times?

 

[phil d]

The grass is always greener on the other side,in reality it isn't,I've been on both sides,had my own business and worked for others.To work for yourself you need money behind you,not just to tide you over in lean periods but also for emergencies.Take a worst case scenario,the van breaks down it's going to be very expensive to repair,maybe even replace,Have you got the money to get another? No van no work!,Also time is a factor,work for someone else and you get time off,work for yourself and time off equals lost income,be it holidays,sickness or whatever.I remember one summers morning when I had my own firm,we'd had a call in the early hours,it was a job that wouldn't wait until morning,my partner couldn't do it so I had to go.I got back around 8.30 am and was sat in the garden having a minute before sorting out my day,a neighbour on his way to work commented on "how nice it was to be able to sit in the sun when some people had to go to work".If only he knew,I'd had about 4 hours sleep in the last 24,was tired,fed up,hungry and still had a days work ahead,oh yes it's all easy working for yourself.

 

[JakeASimpson]

This is why I've thought of 35 weeks.

£16-18 would be good if I worked a lot of weekends. I've ran my own jobs, working on PLC panels

 

[JakeASimpson]

The grass is always greener on the other side,in reality it isn't,I've been on both sides,had my own business and worked for others.To work for yourself you need money behind you,not just to tide you over in lean periods but also for emergencies.Take a worst case scenario,the van breaks down it's going to be very expensive to repair,maybe even replace,Have you got the money to get another? No van no work!,Also time is a factor,work for someone else and you get time off,work for yourself and time off equals lost income,be it holidays,sickness or whatever.I remember one summers morning when I had my own firm,we'd had a call in the early hours,it was a job that wouldn't wait until morning,my partner couldn't do it so I had to go.I got back around 8.30 am and was sat in the garden having a minute before sorting out my day,a neighbour on his way to work commented on "how nice it was to be able to sit in the sun when some people had to go to work".If only he knew,I'd had about 4 hours sleep in the last 24,was tired,fed up,hungry and still had a days work ahead,oh yes it's all easy working for yourself.

there's a very good reason why management charge £32/hour, it's because we have to to cover the costs of employing people, vans, insurance etc etc and try to make a profit so we can pay ourselves. £12-18 / hour is pretty good rates (we have to add National Insurance and pensions to that cost). I would suggest you aren't really experienced enough to go it alone just yet, and I have to ask where are you going to get any work from? You also have to factor in periods of time not working or doing very little - can you pay your bills during these times?

I have money put away, I know at least the first 18 months will be difficult, but I have a lot of experience over the last 5 years. I have a 14 plate Nissan navara currently, basically looking to cut all my outgoings to try making my business a success.

It's either get lower paid hourly rate but try get a lot of overtime or charge the premium rate

 

[binky]

work on £25 an hour minimum for your own work.

 

[ProDave]

I've been self employed for 14 years now. I only went SE when we moved to the Highlands, and treat it as semi retired. I never work a full week ant that's the way I like it, but obviously I earn a lot less than I used to as an employee.

To get 40 hours paid work a week probably means actually "working" 60 hours. You have to find the jobs, go and look at them, price them, order the parts or colleect them from a wholesaler, keep up to date with your paperwork.  If you are aiming to work 8 hours a day then expect to be doing a couple of hours chasing around or in the office each evening. Is that really what you want to do?

Then there's things like a mortgage. I don't know your status but getting a mortgage as a SE tradesman is a lot harder than as a paid employee.

I personally like being SE and would hate to go back to a proper job, but that's mailnly because it gives me the flexibility to not work as much, something I never managed to get as an employee.  The difference is you are just starting out, I am winding down hoping to retire in a few years.

 

[JakeASimpson]

work on £25 an hour minimum for your own work.

I know a few sparks on their own are earning between £20-30 on their own now. They happily take me on but only for normal JIB rate, which is same I'm on so it's pointless. 

Seen a lot of job advertised online for £20-25 but it's in London and I accused it's without digs. A lot of work, within daily driving distance but it's only £16 which after paying for my cost it's better to work my current company 

 

[New Venture!]

I went self employed in 2014 after many years in industry. While I don't regret starting up on my own I certainly haven't had anything close to 40 hours per week regular work. (Ended up working in Tenerife at one point). Have you calculated the minimum clear cash you need each week to survive? Also be realistic when calculating weekly costs of must haves such as scheme membership, public liability insurance, test kit, transport etc. Rate-wise when I started I came across some real jokers who were offering work for £75/day. I refused this, marketed myself as a reliable professional and slowly built up my reputation to the point I'm at now. Still not earning a fortune though.......

Good luck if you go for it. Do you have enough of a financial reserve that you could survive several months with very little income? 

 

[Sharpend]

So let's get real here. 

The JIB rate is set in stone, no company, agency is going to pay more, occasionally if you've proved you're worth you might get a little extra as a subbie. Most will deduct tax @20% agency will also want admin fee, so by doing this you still aren't working for yourself despite what you may think. 

So if you're real about working for yourself then you will have to find your own clients, competing against the already established self employed, some good, some not so, but still they're all out there. 

You have to factor in ALL your costs, from fuel, vehicle, tools (some you may not have), scam registration, update courses, tax, stationary, advertising, lost time, office time, assessment days, non payers, etc etc, and there's plenty more! 

So your £16-18 @ 35hrs a week may match you current wage but take off your self employed costs and you're way off the mark!!

people always think being self employed is a walk in the park, imagine a trek with Bear Grylls and you might come close. Now that's not to say that there aren't positives of course there are otherwise people wouldn't do it. However it will take time sometimes years to start earning a real wage from it and remember just because you have a good week,month,year it can all come to an abrupt end without warning, so don't bank on making millions it's only the banks that do that!!!

 

[Essex1]

You currently get a full days pay.  Does the company you work for also?  Do they only get paid for the time you actually spend working. 

Stay put and get some experience.  Maybe work your way up to approved before even thinking about starting up. 

 

[JakeASimpson]

You currently get a full days pay.  Does the company you work for also?  Do they only get paid for the time you actually spend working. 

Stay put and get some experience.  Maybe work your way up to approved before even thinking about starting up. 

So let's get real here. 

The JIB rate is set in stone, no company, agency is going to pay more, occasionally if you've proved you're worth you might get a little extra as a subbie. Most will deduct tax @20% agency will also want admin fee, so by doing this you still aren't working for yourself despite what you may think. 

So if you're real about working for yourself then you will have to find your own clients, competing against the already established self employed, some good, some not so, but still they're all out there. 

You have to factor in ALL your costs, from fuel, vehicle, tools (some you may not have), scam registration, update courses, tax, stationary, advertising, lost time, office time, assessment days, non payers, etc etc, and there's plenty more! 

So your £16-18 @ 35hrs a week may match you current wage but take off your self employed costs and you're way off the mark!!

people always think being self employed is a walk in the park, imagine a trek with Bear Grylls and you might come close. Now that's not to say that there aren't positives of course there are otherwise people wouldn't do it. However it will take time sometimes years to start earning a real wage from it and remember just because you have a good week,month,year it can all come to an abrupt end without warning, so don't bank on making millions it's only the banks that do that!!!

Thing is, I want to be my own boss, as long as I get close to my salary plus a 10 year old van, I'm happy. Sick of working away all the time. I do make good money working away, extremely good for my age. But I don't have any time, when I do, it's food shopping and having boring days out with the in-laws.

Got two ideal worlds atm, either quote all the time for locals jobs for decent money or 3-6 months contract with fairly decent work within 35miles. Just want to be at home, with family, but need that steady income

 

[Sharpend]

Welcome to the real world!!

Thats life!!

 

[Doc Hudson]

I have money put away, I know at least the first 18 months will be difficult, but I have a lot of experience over the last 5 years. I have a 14 plate Nissan navara currently, basically looking to cut all my outgoings to try making my business a success.

It's either get lower paid hourly rate but try get a lot of overtime or charge the premium rate

Everybody who starts their own business thinks they have loads of experience and are good at what they do. But if you check on statistics its something like 60%+ of small business start ups fail within the first 5 years. The first 18 months and the next 18 months and a few more months after that will be a real struggle. I think they used to say it takes at least 3 years to get yourself established, but even then its cash flow, business management and admin that brings a lot of small business to their knees. Assuming you have got your marketing and advertising right  to get new work, a big mistake is to say yes to everything over commit, then find you are failing to complete jobs on time, or have late paying customers and or don't chase up money owed quickly enough. Never put too much expectation upon promised work. The only work you have is the actual jobs you are doing at any one time and any signed contract agreements. Anything else could disappear or never materialise simply because the customer changes their mind. Don't forget to put the funds aside for the tax man.  Whatever you think you have earned if you forget to make allowance for HMRC, as you will soon find things are fare less rosy when they come knocking for their money. Other advice for new small businesses used to be, make sure you have enough on one side to cover your normal outgoings even if you have no income for 3 months. It is very common to have a lean month or two, so three months reserves give you a better back up to stop you ramping up other big debts on loans or credit cards leaving you continually chasing your tail. Have you read many books about running you own business? how are you with keeping your admin, accounts, invoices, stock etc. all up to date and in control. Have you decided what market you are aiming for?

Doc H.   

 

[JakeASimpson]

Everybody who starts their own business thinks they have loads of experience and are good at what they do. But if you check on statistics its something like 60%+ of small business start ups fail within the first 5 years. The first 18 months and the next 18 months and a few more months after that will be a real struggle. I think they used to say it takes at least 3 years to get yourself established, but even then its cash flow, business management and admin that brings a lot of small business to their knees. Assuming you have got your marketing and advertising right  to get new work, a big mistake is to say yes to everything over commit, then find you are failing to complete jobs on time, or have late paying customers and or don't chase up money owed quickly enough. Never put too much expectation upon promised work. The only work you have is the actual jobs you are doing at any one time and any signed contract agreements. Anything else could disappear or never materialise simply because the customer changes their mind. Don't forget to put the funds aside for the tax man.  Whatever you think you have earned if you forget to make allowance for HMRC, as you will soon find things are fare less rosy when they come knocking for their money. Other advice for new small businesses used to be, make sure you have enough on one side to cover your normal outgoings even if you have no income for 3 months. It is very common to have a lean month or two, so three months reserves give you a better back up to stop you ramping up other big debts on loans or credit cards leaving you continually chasing your tail. Have you read many books about running you own business? how are you with keeping your admin, accounts, invoices, stock etc. all up to date and in control. Have you decided what market you are aiming for?

Doc H.   

I've put away at least 6 months worth of outgoings. Getting a lot of advice of my dad and brother who are both successful business man. I think I'm just gunna jump both feet straight in with a 6 months contract on £17 hour, hopefully get overtime 

 

[Marvo]

Given your lack of job experience and business experience I'd only make the break to self employed if you have at least some guaranteed bread and butter work that would pay at least a reasonable portion of your required income.

As pointed out above, being self employed isn't all wine and roses. A frightening percentage of small businesses and micro enterprises fail within the first few years. The company has provided you with your apprenticeship, they obviously have plans for you so maybe stick around a year or two, get some experience and review the situation at that time.  

 

[Sharpend]

I've put away at least 6 months worth of outgoings. Getting a lot of advice of my dad and brother who are both successful business man. I think I'm just gunna jump both feet straight in with a 6 months contract on £17 hour, hopefully get overtime 

Well glad you took the advice you asked for!!

what contract for six months at those rates ? 

 

[Murdoch]

I know a few sparks on their own are earning between £20-30 on their own now. They happily take me on but only for normal JIB rate, which is same I'm on so it's pointless. 

Seen a lot of job advertised online for £20-25 but it's in London and I accused it's without digs. A lot of work, within daily driving distance but it's only £16 which after paying for my cost it's better to work my current company 

Earning or charging - there is a big difference.

 

[binky]

if you want a steady income this is a bad move. I've only successfully transitioned to self employed because the wife has a steady income that covers all the bills if I have no work. It's taken many years to get to a point where I have a client base that keeps me busy all the time. You will need to work long hours as said before, ideally missus will do lots of paperwork for you, so you can focus on the work and customers.

 

[Tony S]

Earning or charging - there is a big difference.

That statement hits the nail squarely on the head.

In the present climate I wouldn’t encourage anyone to leave regular employment unless they have a steady income as a backup.