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Debts Vs Profits

Discussion in 'Business Fundamentals' started by DAZ982500, May 4, 2005.

  1. DAZ982500

    DAZ982500 Senior Member
    Messages: 142

    I Do'ntknow What Others Do For A Living I Work Full Time For New York State.as I Have Indicated In Some Previous Posts Regarding The Generation Of New Accounts In Relation To The Cost Of Business Its Not Easy To Turn A Profit.i Have Received Good Advice And Encouragement When Intially Starting Off.the Question Today Is Considering All The Factors Cost Of Insurance 2000.00 A Year In Nywith Erie, Cost Of Fuel And The Amount Of Accounts And Snowfall. Is It Still Possible To Make Money I Figured My Over Head Vs The Amount Of Accounts I Have I Will Be Cutting It Close.most People Have Said To Hang In There Takes Few Years To Get Started.how Many Of You Just Squeaked By In Th First Couple Of Years Before You Really Starting Seeing Some Profit. Consider The Factors Full Time Employee Plus The Rest Of The Factors.some Ideas That Were Given To Generate Income Were Subcontract I Have This Lined Up Already 35.00 Dollars An Hour Ifworth It,run New Ad. My Fear Is That If Its A Bad Year Snow Wise I Will Have To Use My Out Of My Pocket Money.the Way I Figure It I Have To At Least Turn Out 4000.00 To Clear Thats Without Any Repairs, Only Then Will I Go Forward. I Need Work And Snow Thats The Only Way I Will Survive This 2nd Year.thoughts Please.
  2. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    Given the scenario you lay out, I'd recommend finding something else to do for a living.

    The first year, I didn't even make enough to pay for my liability insurance, never mind repairs or commercial vehicle insurance. If I remember right, I used about $5,000 out of pocket money and that doesn't count the cost of the plow which was about $3000. The second year was better, but I still used out-of-pocket money for repairs, new tires, a one ton truck to put a sander on, etc. Just repair costs for the first two years were over $3,000. Tires for both trucks were about $1,000. Total income for the first two years was less than half of the repairs and tires together. All together, I had approx $25,000 laid out for equipment, maintenance and repairs.

    But now everything is paid for, repairs last winter were less than $1,000 (including a new set of tires for the 1/2 ton). However, because of how depreciation is figured and adding services which require more equipment purchases, I still show a loss on income taxes. (Hint: I'm not complaining, though)

    Bottom line - it takes money to make money.