This is the first of a series of posts that I’ll be doing every month. In these monthly reports, I’ll first discuss the events that took place during the month and what I accomplished with my handyman business. Then, I’ll go over my income and my expenses in detail and discuss the reason for these results. Lastly, I’ll finish up discussing what my plans and goals are for the following month.
I’m sharing this for a couple of reasons:
- I want to help anybody looking to start a handyman business to understand what to expect financially. I remember when I was first considering starting a handyman business (about 4 months ago), my primary questions were “how much can I make and how much will it cost to start?” Well, it turns out I still don’t know the answer to that question, but I’m definitely going to find out.
- I think it is an excellent way to track my progress and keep myself accountable. If you read my post, 5 Steps to Ensure Success, I mention how important it is to write your goals down and tell people. That’s exactly what I’m doing here.
Events and Accomplishments
This was my first month in business! A pretty exciting time since this is my first business ever. Although I did some research and planning in November to get ready for the handyman business, I’m considering this to be my first month in business. I filed for my LLC the last day of November 2011 and really started to get going from there. December is also when I started to have business expenses outside of just materials.
Filed for an LLC
After consulting with an accountant, I decided it was best to file under a LLC (limited liability company) for my handyman business. This was the best structure for my personal situation, but this is by no means legal advice. You should talk to an attorney and a CPA when considering the business structure you should file under. I chose this structure because it protects my personal assets in the event that my business was to get sued and it is much easier than filing under a corporation.
Filing for an LLC required me to submit two different forms to the secretary of state and cost me a total of $400. This was very simple and I was able to do it online in less than two hours.
Applied for an EIN
Once my business was registered with the Secretary of State, the next step was to apply for an EIN (employer identification number). This is required in order to file taxes or to get a business bank account. This was even easier than filing for an LLC and can be done online here.
Opened a Business Bank Account
As soon as I received my EIN from the IRS, I went to a local credit union and started a business account. I recommend setting up a business account as soon as you can. This way you can keep your personal and business finances separate, which the IRS requires. It’s also just good practice that allows you to evaluate your finances much easier.
I decided to go with a local credit union instead of a big national bank after doing some research online. From what I understand, they are much easier to deal with. When you have a question or you need a loan, you can actually talk to somebody face to face that can help you out. With the bigger banks it can be more difficult. If you go this route as well, just make sure the credit union offers online banking.
Rented a Business Mailbox
I went to the local UPS Store and picked up a mailbox for my business. This way I can separate my business address and my personal address. I don’t necessarily want my customers knowing where I live so this works out well. Just type in “mail box services” and your city into a google search and you will see a few to choose from. Make sure you get a mailbox that appears like a real business address instead of a P.O. Box. It looks more professional.
Had a Logo Designed
This is something that I recommend spending some money to have a professional design. Depending on where you want to take your handyman business, it’s important to begin branding immediately. I’ll be dedicating a post to this in the near future where I’ll discuss this in more detail. I got lucky here because my good friend is a media specialist and helped me design an awesome logo for free.
Setup My Website
This is probably the single most important piece of marketing your handyman business. I decided to setup my own website because I had the time to and it is something that I wanted to learn (I also didn’t have any business). It’s not too difficult to do with all the tools available online, but it was a little bit of a headache. I’ll be dedicating a series of posts to setting up and managing a website in the future. Until then, there are a ton of resources online that will teach you how to setup your website. Or, you could just pay somebody to do it for you. Either way, get one setup.
Income and Expenses
Ok, now we are to the good stuff. Keep in mind that my goal for this month wasn’t to make money, It was to setup my business for success in the future. I did however get one job through a referral that I made a couple hundred bucks on.
- $937.14 (From the one job I did that month. I know, pretty weak. :/)
- Materials: $440.52
- Business Filing Fees: $400
- Website: $137.06 (this will cover me for the next year)
- Mailbox: $146.00 (this will cover me for the next 6 months)
- Mileage: $65.49 (calculated at $0.555/mile)
Total Income: $937.14
Total Expenses: $1,189.07
Although I lost money in December, I did a lot for my business and based on my goals it was a successful month. I did absolutely no marketing prior to this, so I really can’t expect to have business rolling in. I was very happy to get the one job which I got by word of mouth.
Looking at the total expenses, you can see that it isn’t very expensive to start a handyman business, especially if you are cheap like me and do everything yourself. Even if I would have paid for a logo design, that would have only added about $300 to my expenses. Not too bad at all.
Next Month’s Goals
Since I’m writing this a little a late (middle of February), I’m not going to mention my goals for January. Instead, I’ll just tell you what happened in my monthly report for January.
I put a lot of time writing these posts and I hope they are helping you with your business. Please leave a comment below or contact me via e-mail with any further questions or comments.
Thanks and good luck!