[Pelican]

A former employee of mine has bought himself a Z mower and some hand tools and has started his own "Property Maintenance" company! He's had the (enter expletive) to call and ask me how to bid jobs, where to get supplies, etc....

This ought to be an interesting run. This guy is also a friend of mine, I'd like to see him succeed but not at my expense. I don't think he's carrying insurance or has registered with the State Sales Tax dept. I'm not sure how I'll react when we start bidding the same jobs.

Has anyone else dealt with this?

[agla]

That is what is great about America. You can go into business, I can go into business, and your former employee can go into business. But having the right to go into business is not followed by the right to succeed. Now he has to play by the rules. One of those rules is like the Darwin thing, survival of the fittest. Another of those rules is that when you cheat at the rest of the rules, eventually someone playing by the rules is going to complain to the referee.

Since he asked you for advice, you might want to tell him to get legit. Not because you'll call him on it, but someone will. Also, remind him that there is etiquette in business as in any society. That means do unto others as you would accept them to do to you (because they will do to you ...). Another of my favorite lines is "don't sh!t where you eat" which means the same thing.

Hopefully, there is plenty of work out there that he and others are not a big factor in how well your business performs. He may learn that there is more to it than mowing and getting paid.

He has become one of the many landscapers just like yourself. You have to admire his entreprenuerial spirit as you should your own. America is a great place.

[jwholden]

Funny thing, I was just talking to a mason this week who was telling me his 'apprentice' had the skills to start his own company, but was not 'mature' enough yet to start his own company.

I don't think that a good businessperson has to worry about competition. If your clients easily jump ship you were doing something wrong or they weren't the right client for you.

People leaving you to start their own business is a part of life. If he was a good employee don't forget to tell him that if it doesn't work out he can come back and work for you. You'll have a loyal employee for life!

Tell him where the state sales tax dept is, where to get a federal employer number, that he needs contractors liability insurance, etc. As far as suppliers and bidding go that's your 'trade secret'.

[Stonehenge]

Congrats Pelican - You've reached a stage in your company's development that many don't (and I haven't...at least not yet. ), and that is giving birth to other companies in your field. Some say you know you've made it when there are other companies out there that got thier start working for you.

Friends are friends, and business is business. My approach with this guy would certainly be different now, and there is some information I would never share, not with an employee, competitor, nobody. I don't know if I'd have the patience and civility to do what Agla advises, but I do admit they are things that can only help you - show that the road isn't an easy one, and that to be legitimate you have to do a lot and spend a lot.

Plus, even though you have a new competitor, I think this new competitor comes gift-wrapped to you when it comes to competing on a property....you taught him everthing he knows - they'll hire the teacher, not the student.

[site]

Tell him about GTX?

[Stonehenge]

LOL - I was thinking about saying that, except that I figured I'd be pouring salt in the wound....

[Bill Schwab]

Having friends in business is not such a bad thing. The Cutchman ran the disposal empire around the city of Chicago for years. When one got a new customer, it was protected by the covenant they formed. The rules were that if company X's customer calls after he recieved his price increase, company Y would quote so much higher that if the customer jumped ship they were paying more. If any company took an exisitng account from the other, the rule was that the one who lost could go after 3 of the succeeding companies accounts. As so this went for 50 plus years, until Waste Management and BFI hired a bunch of suits fresh out of college who were taught business, but had no clue as to how to operate the trucks, routing or alike. The result was cut throatedness, driving small operators out and forcing sales and mergers. When Waste and BFI's mismanagement caught up with them, both were bilions in debt and are still fighting to show profits.

Now, put the early scenario in play with landscape contractors, not so much by colluding as the early dutchman had done, but with sharing good information and respecting the others accounts, and both sides could have a win win.

[Pelican]

I hope I didn't come across as bitter with my initial post, I'm not. This employee left me for a different field 1 year ago, and it didn't work out. I offered him his job back at higher pay and benefits, but he's decided to embark out on his own. I held out as long as I could before hiring a replacement for him.

There's more to this story I'd rather not print, has something to do with the companies he's aligning himself with. I wish him luck, but his experience in the business is very limited as far as construction and business management goes. The grounds maintenance he has a pretty good grasp of, maybe this is where he'll succeed. I hope he surprises me.

[Pelican]

Another chuckle today! I got a call from my new competitor asking to rent my machine sans operator! Seems he came across a job where he needs a machine and thought "Why not?"

[Stonehenge]

That he would call and ask seems amazing to me.

[justgardens]

Pelican, I make it known to every potential client I go see that my company has insurance and Workman's Comp ( copies supplied)and that I wouldn't hire anyone who didn't carry both. How can you compete on a level playing field otherwise? I wouldn't hire anyone to work at my home without these either. Make no apologies. Business doesn't mix well with friendship. Keep them seperate. Let him rent his own machinary. If he wants to run with the big boys let him find out what it costs! Give him the number to the local Rent-A-Center and good luck finding what he wants in when he needs it. That's why I bought my own sod cutter. That is beyond bold for him to even ask to borrow your equipment.

[Dale Wiley]

Pelican:

before I reply a couple of questions.... How old are you , how long in business ??

[justgardens]

Now that's a strange question! How does my age and length of time in business help in your reply? I can only assume you would ask that of everyone who replies?

[Dale Wiley]

In this case Julie I think it has some relevancy.

Age in itself and your position and circumstances in life at any given time affect your judgements, perceptions and tolerance levels and rationale of most situations.

A person may tolerate things more at a younger age due to life inexperience and business inexperience. If you have few personal and business responsibilities, you are going to let more slide by.

As time moves on, you incur debt to grow your business, you get married, buy a house, all these circumstances will weight into any decisons and rationale you apply to a given situation.

When you have lease payments to make, house payments to make, maybe a couple of employees to pay, I will be dammned if I am going to let a former employee, or any other compititor take any kind of illegal or unethical advantage of me or my business.

At age 47, with over 26 years in the business I tolerate much less than I did at age 30. My wife and I have raised 5 kids, still a couple at home and it has taken EVERY DIME we both made to do it. Now its time for us to build our retirement savings and do something besides work 7 days a week.

I have had to compete against compititors who had no contracting licenses, who use tax subsidized labor, who don't have chemical licenses and insurances. Now why the hell should I let them take money out of my pocket ???

17 years ago, I had a higher energy level and would just go sell more work to make up for it. But times change, the buying whims and preferences of consumers change and the way these consumers purchase goods and services change. I pay every tax, every license, every insurance the law requires and I see people every day who do not, and who manage to stay in business and one step ahead of hte inspectors, even thought I rat them out every time I see them doing something illegal.

I have over 100K in equipment, and I will not rent it or loan it to a compititor, my inlaws or my neighbors. Fix a few $ 1,000 screw ups and most people won't either. In order to succed in business, a person has to beocme knowledgable about business as well as the techinical side of the trade. I started doing much better after going back to school and getting an associates degree in business. I have the accounting and job costing and profit margins nailed down tight in this business.

We will do about 250K with about 20% net profit after everything , including me is paid. No one will alter my profit margins in any way if I can help it.

There were several good points made in the replys. Competing on a level playing field is esstential to the long term survival of your business. Allowing or contributing to a compititors business is taking money out of your own pocket and letting them eat your lunch.

I am not bitter, I have just been majorly hosed several times over the years, and it took me a long time to have a different outlook. Lose a few thousand dollars because you helped someone, or some one used information you gave them, or they back doored one of your clients, and I guarantee you will have a different outlook.

When I bust my ass, to make house payments, feed and clothe kids, contribute for their education, pay my bills on time I full well won't have ANYONE take advantage on me.

I meant no offense by the age and experience question, and I am sorry if you took it that way. There was no internet when I was learing the business and beginers and newcomers have more resources avaliabe to them than ever before.

[justgardens]

Pelican,
There really was no offense taken, a chuckle maybe though. Hasn't anyone ever told you you're not supposed to ask a woman her age? However I understand your request a little better now. I am 48 and have been in business for 10 years. I agree with you. I thought my first reply might be a little harsh sounding to some. I started out very small and have earned my place in the county as the premier landscape company here. I give seminars during the winter months and post on website things a client should pay attention to when hiring a landscape company. I have an advantage by my years in business, knowledge, being a woman ( yes, and I'm loving it)and stability. I take advantage of everyone of them every chance I get. There are some good up and coming companies with great young men with an eye for design in my neck of the woods. I like some good competition, but they better not ask to borrow my equipment or they would get a laugh in the face, friend or not. I have never had anyone leave to start their own company.

My husband suggested I put in a recent hires contract a "no compete clause" which I have never done yet. This new hire I have is quite knowledgable in hardscapes but wants to learn the design end also which I am willing to teach him. After working two weeks with him I can see that he does not have what it would take to "compete" even if he did want to. There is something about people like us that makes us want to start own businesses in the first place and it is that thing in us that drives us to be the best. Some people think running your own business is easy. It isn't and to keep up the professionalism takes hard work. Just business 101, like returning phone calls and showing up for appointments is tough for most companies around here. There are so many poor business people in this profession that it has been like taking candy from a baby to grow my business. My only real competitor was so busy with his retail store he didn't return phone calls, "forgot" appointments, ect. He is now out of business.

To be successful takes hustle and knowing your competition. I am still learning and making mistakes that I am kicking myself for after 10 years, but I learn quick. I had to eat some real crow just this weekend when I did something my husband counseled me not to do. It came back to bite me the same day. My husband is a banker and has dealt with small business for 29 years and I value his input into my business, another advantage I have. He has taught me much. The only loan he ever gave me he made me pay back with interest when I first started. I thought sleeping with my banker would help.....it didn't!

I can't tell you how many other landscapers jobs we come in and "fix". After all the years in business you've had I'm sure you could tell some stories. To the lawn mowers and newcomers with magnetic signs on your trucks that say landscaper ,I say bring it on, but I also know someday, someone with a good work ethic, good design skills and management style is going to come around and dethrone me. Until then they are going to have to fight for the business because it won't be easy taking it from me!