Saying No to Grow: A Painter’s First-Year Pivot

Welcome to the Profitable Painter Podcast. The mission of this podcast is simple: to help you navigate the financial and tax aspects of starting, running, and scaling a professional painting business. From the brushes and ladders to the spreadsheets and balance sheets, we've got you covered. But before we dive in, a quick word of caution. While we strive to provide accurate and up-to-date financial and tax information, nothing you hear on this podcast should be considered as financial advice specifically for you or your business. We're here to share general knowledge and experiences, not to replace the tailored advice you get from a professional financial advisor or tax consultant. We strongly recommend you seeking individualized advice before making any significant financial decision.

Welcome to the Profitable Painter Podcast, the show where painting contractors learn how to boost profits, cut taxes, and build a business that works for them. I'm your host, Daniel Honan, CPA, former painting business owner, and your guide to mastering the numbers that drive success. Let's dive in and make your business more profitable one episode at a time. I'm super excited today to have Jordan. He has an amazing painting business up in Virginia. I'm excited to jump into things with him today. Welcome to the podcast, Jordan. How's it going?

Hey, thanks for having me. Uh, it's going well. I'm excited to talk about the business and see where this thing goes.

Good stuff. Awesome. Well, it— just to give listeners an idea of where you're coming from, could you give us an idea of how you got started in the painting industry? What's been your journey along the way? Maybe some major milestones?

Sure. So I started my painting business back in June of 2024, so technically I'm still a startup. Um, I have about 7 years in the construction industry, primarily coming from the commercial industry where I built data centers up in Northern Virginia. And then, uh, relocated. Um, so I had a daughter and a family, so we relocated back home to Richmond, Virginia, and I worked and did some residential construction building multi-family homes. I did that for a little while and then decided I want to step out on my own to start a business. So I started a painting business. I have a couple buddies in the industry, and it seemed like a good industry to get into, um, being that I had a, a pretty diverse background in the commercial world, project management, estimating. Um, so I thought I'd be a good fit, um, to be a good business owner, um, for a small business.

Good stuff. And so what sort of services are you providing in the painting industry?

So we— when I first started, interestingly, I, I was going to start a painting and renovation company. Um, I realized quickly that I would never be successful if I try to do it all and GC everything. Um, so I niched down pretty quickly within the first month to just painting. So we do interior painting, exterior painting, and cabinet refinishing, and it's primarily interior and cabinet refinishing focused.

Gotcha. And this is residential repaint pretty exclusively or exclusively?

Yep, residential repaint, um, fairly exclusively. Um, I've done a little like fit-out, small commercial work. Um, but we don't gear our advertising toward, towards that yet. Um, that's something I'd like to dabble in in the future, but right now it's mainly focused on interior residential work. Yeah. Okay.

Gotcha. So mostly interior and cabinets. And so you've been in business for a little over one year, right? And that first year is usually the roughest, so Could you, um, and just thinking back to my first year in running a painting business, uh, it's giving me cold sweat right now just thinking of it. But, uh, how has the first year been? Like, what are some, been some major challenges that you faced in the first year?

Yeah, so when, when I started the business, I didn't start like as a painter. I'm not a painter by trade. Um, and I came from kind of the white collar slash blue collar background where I was doing project management. I was wearing a suit and tie to work pretty much, uh, collared shirts. Um, so I started this business and I realized quickly that I needed to make money. Um, and I needed to make a decent amount of money because I had a family. Um, so I started doing work for like side jobs and smaller jobs, uh, doing everything myself, advertising, marketing. and the work. And like I said, I'm not a painter, so it took a long time to do small jobs. Um, they weren't profitable and it was terrible for, I don't know, the first 2 months. Um, and then I went down the path of kind of chasing every shiny object, right? When you start a new business, everyone wants to call you. Your phone's going off the hook and it's not clients. It's, it's marketing companies. It's Angie's, it's Nextdoor, it's lead gen. People calling you. So I did, I got caught in the Angie leads for a little while, did a couple of lead services. And it didn't really work out too well for, for me personally. The leads that we're getting weren't super great. And then I finally paired up with a real marketing company and I started getting real leads. So I started getting real reps in and started landing substantial work. to where I couldn't do it myself anymore. Um, so I started subcontracting work out, um, through a few subcontract partners, um, to get more work, get the workflow going and keep up with the work I was getting. Um, but it was messy, man. It was, that first 6 months was so messy. I had no systems. Um, my processes weren't there. The sales were there. The marketing was there. And it was bad for the first 6 months or so.

So what do you feel like was the big unlock? Like what happened after 6 months that, that changed things and started getting things moving in the right direction?

Yeah. So I started saying no a lot more to every single opportunity. I stopped doing anything that had to do with renovations or like quoting that. If it was a large exterior and I knew I couldn't handle it, I would say, hey, you know, I'm sorry, we can't handle this work at this time. Um, so I started saying no more. Um, I hired that marketing co— um, company and they also did consulting as well. Um, and they kind of put me on the right path to, hey, this is what you should be focusing on. You should be niching down. You should be systems and ops focused and not trying to do everything yourself. Um, so as soon as I started implementing that, little changes at a time, I started to get my time back and was able to give these clients a better experience and then give myself more time to develop these SOPs and systems to make us profitable and do more jobs.

That's awesome. I love the, you know, you started saying no more and that was what really made the change on how things were going. And I forgot who said this, but basically saying no is like saying yes to the thing that you promised yourself you're going to do. So you were saying no to the remodeling and the side jobs. And you basically, every time you said no to those things, you're saying yes to residential interior and residential cabinets. And I know you just do some exterior as well, but kind of stay focused on that stuff.

Yeah, and I took a, I took a step back and I kept getting all this work and I was getting about 6, 7, 8 weeks booked out. Um, and I came to like a crossroads like, hey, like the subcontracting model is great. Um, but it's not really what I wanted to do. I wanted to run my own teams. Um, so about that 7, 8 month mark is when I started hiring, um, like W-2 painters. I hired an appointment setter to handle all my appointments and my calendar. Um, and just doing those two little things right there gave me so much more time and doubled the amount of work I was booking and producing each month.

So what, where were you? So about 8 months in, you hired your employee painters. How many employee painters did you hire at that point?

I hired one to start. Um, and then I hired another one maybe a week and a half later. I never stopped, you know, the hiring process. I just want to make sure I had the right people in the right seats.

And then you also get that appointment setter so that they can answer phone calls, call leads that come, that came in. Are you doing Facebook, uh, Meta advertising or?

Yep. I do a lot of Facebook ads. Um, SEO website. So we get a few leads from there. Um, and then we're going to start launching our LSA ads here soon. to get more leads coming in.

Nice. So you said that, that 8-month mark, you started doubling the amount of work that you were producing. What was that number at, like 8 months in?

So pre-8 months or like right at 8 months?

Or like in that timeframe when you started doubling, what was that revenue that you were doubling?

Sure. Yeah. So I started, I was doing about $20,000 to $25,000 a month. Producing and selling. Then 8 months, about that 8-month mark until now, which we're at like month 14 of the business, we've been selling between $50,000 and $60,000 a month.

$50,000 and $60,000 per month. That's awesome. So you basically went from like a, a business that does around $300,000 per year to a business that does like $600,000+ per year. So that, that's, that's amazing. That's a very quick change.

Yeah, we, my first year in business, so from June to June, we did right over $360,000. Um, and then January 1st of this year, right, is when I kind of knew what I was doing a little bit, right? I still don't, I feel like I don't know what I'm doing sometimes, but I knew I was on the right path because I tried everything that first 6 to 8 months and I found what I liked, what I didn't like. But now I know what I like and kind of how to do things. So I really hammered in on marketing ad spend to hit the goal of $500,000 to $600,000 this year, which I think we're on track to do.

Nice. That's, that's great growth. That's amazing. So basically on track to do Nearly, nearly 100% growth. Um, so that's, that's great stuff. And, you know, one of the things, uh, you mentioned was you started with subcontractors, but then you switched to employees. Are you completely employee model now, or do you still use subs?

We still use subs. It's about 60/40, uh, W-2 versus sub. Um, but I'm very— it's not just I don't just use any sub. I use 1 or 2 subs and that's it. And so much so that they're exclusive to me essentially. So they're kind of like employees. I know we can't say that right there. They still are 1099 contractors, but they don't do much side work, right? So it feels like they're members of the team just as much as my W-2 team.

Gotcha. And did you, I guess, making that switch to employees, um, what was the thinking there? Like, why did you make the switch? And then has it brought— has it been a good change from going from subs to employees?

Yeah, so the sub model was great. Um, like I said, it started my business, it got me going. Um, and then I started booking. I was booking 2 months out. And it was either I go ahead and start interviewing more subs and find these trusted partners again, or kind of build that brand and team that I wanted to do anyway. So I was like, well, now's the perfect time. I'll, I'll build a small team and we'll start doing jobs, uh, with that team. And we can grow that team a lot easier once that foundation's set and those processes are set. Um, so that's why I did it. I made sure I was about 8 weeks booked out. I took 4 of those weeks and instantly had work for my W-2 employees. Um, and then I increased my ad spend and then kept both, both crews busy. Um, ever since.

Nice. So you, you kind of was that, uh, booking 8 weeks out, was that intentional in preparation for hiring employees or was that just kind of where you were and you just took advantage of that?

It was, it was semi-intentional, I think. I don't remember the exact decision, but I think I wanted more work anyway. Um, and it just kind of naturally happened when, when you're booking especially bigger jobs, it's like, okay, well, there's a week that's only one job. Uh, but I was landing 3, 4 jobs a week. So my production was not keeping up with, um, the work that was coming in. So I, I had to make a decision, either hire or sub out more work. Right.

Okay. So you, you're at 8 weeks, which 8 weeks is, is for residential repaint. That's a little bit high. So that, that was definitely indicating that you needed some more capacity for sure. So you just went with, okay, I'm going to go with employees instead of continuing, continuing down the subcontractor route. Um, and at this point, how far are you booked out now?

Right now we're about 5 weeks booked out with 2 crews. Um, actually probably 8 weeks booked out because there's a lot in the pipeline, um, that clients are not in a rush to paint or they want to do it in the winter, um, or even early spring months. So the jobs are there and I'm kind of at another crossroads on, uh, if I want to hire more people or not.

So yeah, definitely sounds like you, you have, uh, have you ever heard of the rule of 3?

I haven't.

So it's, uh, it's actually, I think it was a podcast I recorded, um, with Tara Riley out of the Academy for Professional Painting Contractors. She, she's a, uh, I don't know if she came up with this rule of 3, but this is the person I heard it from, um, which I really love it. And it's basically you want to be able to respond to a new lead coming in within 3 minutes. Like if it you have a Facebook lead that comes in, you want to be able to reach out and call them within 3 minutes, which it sounds like you have an appointment setter that does that. So that's, that's great. Then the next rule is, once you get that appointment scheduled, you want to be out, out there providing an estimate or proposal within 3 days. So you'll need to have enough salespeople to be available within 72 hours of that lead, you know, coming in and you can actually get to their home to provide that in-house consultation. And then the last one is 3 weeks from when they, when you close the job, 3 weeks to production, assuming that they want it done, you know, you know, like you mentioned, sometimes people just want it done later or whatever, the winter, you can't paint outside. But generally, if folks want it done, you can produce it within 3 weeks. And that's the rule of 3 to basically give you an idea of, do I have enough of a team to produce the work that's coming in or to meet the demand that's coming in?

Right. That's a good rule.

It's a good rule. Yeah, I like it. So It's, it's, it sounds like you're potentially, you know, a little low on, on the crew side. And if you hired more, you might be able to produce that revenue more quickly, and actually, you know, hit your $600,000 a year, your goal that you have, or maybe even surpass it. Cool. So We talked about basically in the first 6 months, it was chaos. You were doing everything yourself. You were, you weren't focused. You got more focused. You started saying no and focusing on the things that you wanted to do, which was interior and exterior, interior and cabinets primarily, and some exterior residential work. And then things started to take off when she started focusing. And you're using the subcontractor model kind of pivoted slightly to more employees and you're able to ramp up production and double the amount of work that you're producing each month. What are— are there any other big challenges that you faced over the last year or so?

Yeah, there's been a lot of big challenges. Trying to think of some, some key ones that stick out to me. Yeah, the biggest challenge though, I'm in the National Guard as well. So that takes up a decent amount of my time. And so it was June to July, about 3 weeks I was gone, 3 and a half weeks for a major training exercise that we did. And, and when I mean gone, I mean gone. I didn't have access to anything. For 3 weeks. So I knew about it obviously ahead of time, but it was a big challenge. I had to get this newly formed W-2 team ready to go without me being there, right? They can't just call me and ask, hey, what color goes on the walls? They can't call and say, hey, what's the cost of this project and how do I handle invoicing? So I had to get the team ready and I feel like I did a good job getting them ready. We did walkthroughs. With every client, um, weeks before the job started, or, or even days, right? All the way up until I left. Um, and then I relied heavy on my admin, my appointment setter, to do the job coordination side of the house, make sure the reviews are getting done, make sure invoices are getting filed, checks are getting cashed, payroll's getting done. Um, and we did it. We did 3 weeks, uh, me not being here. I think we completed 8 jobs in those 3 weeks. Every job was profitable. We had got multiple 5-star reviews. Um, and I came back and everything was intact, right? Yeah. It was kind of like a major fishing test.

Yeah.

Um, but we did it. And then I came back and, and I did have to hit sales really, really hard.

Yeah.

Uh, because, right, no one was doing sales for 3 weeks, but we made it work. Um, and, and I never, had to tell the guys or even subs, hey, I don't have any work for you next week. Right. Um, so that was a major challenge, probably the biggest one. Um, but we, we, yeah, we killed it.

That's, that's amazing. Uh, first of all, thank you for your service. Uh, of course. That, that is amazing. I was in the National Guard too for 13 years. So I know the pain of going to annual training and being in the woods, having no idea how things are going, being completely cut off. So that's within the first year. I never had to do it my first year of business, thankfully. But so I can't imagine, you know, only having your team for a few months, and then you have to leave for 3 weeks with no contact. So it sounds like you put together a really great team very quickly. To, to be able to shoulder the, the burden of the company while you were gone and without being able to ask you any questions. So it's definitely a testament to your team and to your processes so early in your business. That's, that's amazing.

Yeah, it's pretty cool. And I'm actually— I get on a, on a plane tomorrow and I'll be gone for 2 weeks, and this is all personal, uh, stuff. So we, we did it once and now The team's confident, like, okay, cool, we'll see, see when you get back, right? It's like another day at the office for the team, which is great. But I have that flexibility and that freedom to do that now. Yeah.

Yeah, no, that's cool. Now you've kind of built it. And so now you have the ability to leave for vacation and, and be confident that your, your team is set up. What are some things that you've you did that made it— you feel like was really important to making it possible for you to leave and things to be okay?

So I think it's kind of two parts, right? One is getting the work, which I had to be confident in myself to get the work, and I have to make sure the work's there. So once the work's there, we just use the same systems As if I was here, I'm just not there. So we send all the work orders for the week on the Friday before that week starts. So the crew lead, they look at all the work orders, they know what type of paint, what color, what the scope is. So they, they can go to the paint store on Friday, Monday morning, what have you, right? That's kind of the easy stuff. They understand the scopes of the work. Um, and then any nuanced clients, right? Because some clients are super easy to work with. Some you kind of get an idea, hey, this might be a tough client because they're going to be nitpicky because they said they were. I would have those conversations with the team like, hey, Susan might be a little bit of a difficult client. She's great and all, but make sure we're paying specific detail to X, Y, and Z. So we have those type of conversations. We do job walkthroughs and review the scope in detail. I make sure the client meets the team lead. Because I won't be there. And then our project coordinator or appointment setter, she'll do the same process. Even if I wasn't there, she'll call the client. Hey Susan, we're going to start your job on Monday. We're still making sure we're good to go. The guys will be there at 8 a.m. How's that sound? Right. So we do those things and then it's pretty smooth sailing after that. We do our end of day reports in Slack, which is just the messenger that I'm sure a lot of people use. But the crew lead will say, hey, this is where we're at today. She'll— she may ask a question, hey, are we still on track to finish on Wednesday, or do you need more time? So she could do that coordination piece of either pulling the other client or push back a day or two because things happen. So she really steps up and does all the project coordination and makes it pretty seamless. So that's pretty much it, just making sure the systems that we do have, everyone knows, hey, just because I'm not here doesn't mean we don't submit end-of-day reports, right? And everyone kind of understands and they're on the same page. So I think that's what makes it kind of easy to do.

Yep. That's great. It sounds like you have really great processes that, that your team understands. and you have communication set up with Slack and I'm sure other things to make sure things are getting done. Um, do you, do you have these processes documented or is it just on-the-job training that, that they just know what, what their role is?

Yeah, the basic ones are documented. Um, they definitely need more detail and they need, they need to be updated and finalized as As I'm learning more about what I like and don't like, I did use ChatGPT to help create some of these processes. And then I have buddies in the industry as well that have given me some of their processes that I can make my own. And then the consulting programs that I went through, they all have processes as well. So I had all the resources in the world available. And I didn't create anything by myself. Um, so it's super helpful, right? When you have the resources available, you make them your own, and then you implement them, and then you put them in these different channels in Slack and files on your Drive, and then you enforce them.

Yeah, that's amazing. It's great stuff. So you get the resources. I mean, uh, for, for folks listening, believe it or not, many people have run a painting business Uh, so it's all been done before. And so you basically went out and got, got, uh, those processes from friends in the industry, from folks in the industry that are, that sell them or have courses or whatever. And you just put them together and made them your own and just made sure that your team followed those processes. That makes a lot of sense. And it definitely seems like it's paid off with you being able to leave for 3 weeks in the middle, you know, cut off from them completely and now taking advantage of that. Advantage of that, taking a vacation. So that's amazing. Um, so it sounds like basically getting the work lined up was important because you're the salesperson still, and then just making sure you have the systems and that folks are following the systems. That's, that's great stuff. Um, well, I really appreciate the time you spent with me today to kind of take me through your, your first year, and I think you've done an amazing job. I mean, this is I know you said the first 6 months was rough, but it sounds like you learned very quickly on how to fix that stuff and it sounds like you're rocking and rolling now. Do you have any last thoughts for maybe a painting business owner that's just getting started or maybe feels like the way you felt in the first 6 months? Any final thoughts before we let you go today?

Yeah, I would say get involved in the community. The painting community is ginormous, right? If you're listening to this podcast, obviously Obviously you're involved in the community somewhat, but take advantage of the resources, the free and paid resources. They're there. There's a bunch of different communities out there. Get involved with them. Start talking. Make friends. Because it does suck sometimes. It is tough sometimes, but we've all been through it. We share stories and keep moving forward. And just know it's going to be okay even when it feels like it's not. Just keep trucking along and then somehow it, it all works out in the end. So let's keep moving forward.

Good stuff. It makes a lot of sense. And, uh, once again, thank you so much, Jordan, for coming on, sharing your story. And for the listeners, we will see you next week.

Thanks, Daniel.