it is not only exter we are looking at . The aim is to expand across Devon and then look at other cities and nearby counties. We are aiming high and my partner will only take a wage when the business can take it. He does not have the money to go larger than being a sole trader and cannot spend so much on tools and advertising etc. The Idea is that I put up all the money, do all the advertising getting out meeting clients etc etc and spend hours on the business development. The reason he gets 30% is that I may well end up putting 30-50K into the business. I do not think he is getting a bad deal at all and he will still get paid more than he makes currently.
I do understand that the domestic market is very cut throat, but the work is out there. The commercial works will be more rewarding, but if any of you have looking at pre-qualifying tender check lists, you can't even bid without 3-5 years credit worthiness and a good float of cash in the bank to show you are big enough to handle the contract. That is why the domestic market is being targeted to perform some steady income - although profit margins are not great and then get a higher margin of the commercial work that is won.
That's fair enough - certainly Exeter alone wouldn't have given you the volume of work you're looking for. That kind of turnover in a domestic setting would need probably two or three counties. And a particular niche in your neck of the woods may still be thatched cottage works too - special rules often apply.
I understand what you're saying about your partner - and yes, if you're putting up the money, fair enough - as to whether he's getting a good deal would depend on the value of his assets and trade just now too - off the top of my head, you're valuing his share of things at about ÂŁ20k. Even with ÂŁ70,000 effective investment, though, you'll find domestic very hard to make a fast return on, though if your figure show he's getting a good deal, and making more than he currently is, then it's the right thing.
As for PQQs, it depends on many things. Most LAs now have much reduced criteria for smaller works under ÂŁ25k - and many will accept start up bids too. That said, you still can't beat pitching up and asking for work - commercial comes in many forms too - and maybe that's where you should be targeting your marketing right off - every industrial estate, farm, and so forth you can find, if that's where you want future work to lie.
We took a very hard decision sometime back in 2008 or so, that we'd not go for the domestic market at all (mainly fire and security, though some electrical too) - so for us, a longer, harder slog in some senses, but..... it came down to us convincing our first big commercial that we could cope with their work. The second a little easier, the third, fourth and so on.....
We're now looking at local authority work, as it *can* be lucrative if done right, but again needs a mentality not found in domestic or commercial work - if you're working to a JCT or similar contract, everything needs to be on the nail. We're finding that a lot of the criteria such as "xyz approval" can be negotiated, 3 years trading etc., can be negotiated - what most councils and similar bodies have to prove is a few things:
That the contractor can offer best value, that contractor is viable and will be there for the duration, that the contractor can respond suitably to the requirements of the JCT. If your tenders, much as they're "tick boxes" in some respects can answer those questions, you'll get a look in.
If NICEIC is a requirement, talk to them and tell them what your plans are, get them onboard to help.
