The Rise & Rise of the Celebrity Electrician

[Dustydazzler]

So in recent months I see Tom Nagy , Nick Bundy and now Artisan have all upgraded and got proper office space and storage units etc etc

I am pleased (yes genuinly) to see so many fellow traders to be kicking on and building up their business empires

My old boss in London started his business from a sh!tty old unit in Fulham in the late 60s and now runs an electrical contracting business employing about 45 full time staff (about 5 office and 40 sparks last time I spoke with them)

Keep it up lads

 

[mattg4321]

Think you're splitting hairs to be honest mate

 

[UNG]

Companies house says he has a decent amount of money in the business. that said micro accounts tell you next to nothing in real terms as I have nearly 20k in my company which counts as a liability to myself so reduces the overall picture...

A decent accountant can make your accounts look as good or as bad as you want them to be

 

[Electrics]

Think you're splitting hairs to be honest mate

Nah, there's a pretty decent although subtle distinction between the two which like i said normal one man bands don't understand but those who are rich and successful most certainly do.

I am neither but i know an awful lot about how to set up a business properly, and let me tell you that buying vans outright so 'i owe nobody anything' shows a complete lack of knowledge about the subject.

Was just trying to educate a bit.

 

[nicebutdim]

Nah, there's a pretty decent although subtle distinction between the two which like i said normal one man bands don't understand but those who are rich and successful most certainly do.

I get the point you're making about leveraging debt, which is common amongst big businesses, but it's not the case that 'all successful businesses' do this.

 

[Electrics]

I get the point you're making about leveraging debt, which is common amongst big businesses, but it's not the case that 'all successful businesses' do this.

Depends how we define success i guess. If you pay everything up front all the time but have your van on HP you are using debt to fund your company. I don't see many people buying a £20k van outright because they 'don't like debt'. Mostly everyone of any decent sized business at least has their van on tick.

 

[pirate]

Always different ways of looking at this, and I think it depends a lot on the type of business too.
I ran my business as a debt-free concern, owing nothing to anyone.
When the crash of 2008 arrived, we lost 70% of our business for several years, and in fact it never fully recovered even after 5 years.
Many similar businesses made massive redundancies or went bust. We retained all of our staff, they took a small reduction in wages for a couple of years, but were glad to have a job. I, and my fellow business owners took no income for a few months, then gradually we did pay ourselves a little, but not every month, until things improved. Having no borrowings at all meant we survived intact, albeit our standard of living was somewhat reduced. The other similar businesses which ran on overdraft, with leased equipment and cars, suffered badly. Thus, I repeat, it depends on your business to some degree.
As for a business model, just because you have an entity does not always protect you from debt. We were certainly an "entity", but we were a "firm"...that is to say, a standard old-fashioned partnership, so the partners were personally liable for any debt.
Having a limited company "may" protect you, but only if you don't have any personal guarantees to the bank. Some banks will only lend with personal guarantees, especially if you are a small business.
Other business models are available...a good accountant is invaluable if you are contemplating a change.
Being debt-free helped enormously when we sold the business on retiral. The purchasers got a clean sheet, we got top dollar and the whole deal was done in a few weeks.
I know it is not always possible to be debt free, but I am simply saying that it is not always a daft way to run the show. No sleepless nights, no repossessions, just tightening the belt in difficult times. On the other hand, properly managed debt can be an ideal way to run and grow a business, especially in these days of minuscule interest rates.

 

[nicebutdim]

Depends how we define success i guess. If you pay everything up front all the time but have your van on HP you are using debt to fund your company. I don't see many people buying a £20k van outright because they 'don't like debt'. Mostly everyone of any decent sized business at least has their van on tick.

Indeed most companies now use finance for capital purchases or lease agreements for company vehicles, but there are, and will remain, a percentage of very successful companies who don't do so for a number of reasons.

 

[Electrics]

Always different ways of looking at this, and I think it depends a lot on the type of business too.
I ran my business as a debt-free concern, owing nothing to anyone.
When the crash of 2008 arrived, we lost 70% of our business for several years, and in fact it never fully recovered even after 5 years.
Many similar businesses made massive redundancies or went bust. We retained all of our staff, they took a small reduction in wages for a couple of years, but were glad to have a job. I, and my fellow business owners took no income for a few months, then gradually we did pay ourselves a little, but not every month, until things improved. Having no borrowings at all meant we survived intact, albeit our standard of living was somewhat reduced. The other similar businesses which ran on overdraft, with leased equipment and cars, suffered badly. Thus, I repeat, it depends on your business to some degree.
As for a business model, just because you have an entity does not always protect you from debt. We were certainly an "entity", but we were a "firm"...that is to say, a standard old-fashioned partnership, so the partners were personally liable for any debt.
Having a limited company "may" protect you, but only if you don't have any personal guarantees to the bank. Some banks will only lend with personal guarantees, especially if you are a small business.
Other business models are available...a good accountant is invaluable if you are contemplating a change.
Being debt-free helped enormously when we sold the business on retiral. The purchasers got a clean sheet, we got top dollar and the whole deal was done in a few weeks.
I know it is not always possible to be debt free, but I am simply saying that it is not always a daft way to run the show. No sleepless nights, no repossessions, just tightening the belt in difficult times. On the other hand, properly managed debt can be an ideal way to run and grow a business, especially in these days of minuscule interest rates.

Every single one of the richest people on earth use debt to their advantage. The mindset of don't use debt is one that has been taught to the lower classes. There's a reason Elon Musk etc have billions in net worth but can't pay small fines because they have no cash flow.

The problem isn't debt, the problem is that people don't know how to use it properly. This thread is a prime example.

Anyway the point is Nagy isn't a fool for chucking his repayments down the road - it's actually a very smart business decision.

 

[pirate]

I respect your right to your opinion on this, but I am a little concerned with your terminology of "the lower classes" as i feel this is an unnecessary discrimination/subdivision with no boundaries defined and possibly offensive to some. You have absolutely no idea of my "class" nor what my business was, nor my outlook on life. I have and never had, any vision of being super-rich, but I'm ok!
Thus, in my opinion, a debt - free business model is a perfectly viable option, it suits some, but not everyone. That's my point, and I hope you respect it, even if you dismiss it as a model for your own circumstances.

 

[mattg4321]

Indeed most companies now use finance for capital purchases or lease agreements for company vehicles, but there are, and will remain, a percentage of very successful companies who don't do so for a number of reasons.

Think you’re wasting your time trying to argue this point ??

I’m sure Amazon would have a new CFO if Jeff Bezos ever came across this thread!

 

[Electrics]

Think you’re wasting your time trying to argue this point ??

I’m sure Amazon would have a new CFO if Jeff Bezos ever came across this thread!

The real funny thing is you wouldn't believe how little actual money Amazon makes and that Jeff built his entire business model on shifting money from Peter to Paul. You couldn't have possibly chosen a better example to prove my point.

Amazon has $33bn of debt ??

 

[pirate]

Oh well, I don't have your insider knowledge @Electrics so I will just bow out now.
I have a busy day tomorrow managing my portfolio of 80 rentals, getting someone to valet my stable of exotic cars, and arranging a private jet charter to visit my property in Spain...all paid for and debt free!
Mind you, when I park in the local town centre, I never have a pound coin for the meter...

 

[mattg4321]

Running a small business is a bit different to Amazon though. There are a few ways to do it.

I’m sure you’re probably not as well versed in some of them as you are in the finances of big multinationals though!

 

[nicebutdim]

Every single one of the richest people on earth use debt to their advantage. The mindset of don't use debt is one that has been taught to the lower classes. There's a reason Elon Musk etc have billions in net worth but can't pay small fines because they have no cash flow.

I don't dispute this.

The problem isn't debt, the problem is that people don't know how to use it properly.

Or this.

Anyway the point is Nagy isn't a fool for chucking his repayments down the road - it's actually a very smart business decision.

That's pretty much the point I'd originally made about Tom Nagy.

While I understand your point that not everyone understands debt and how it can be used to one's advantage, it also appears to be the case that you fail to understand that not every rich person, or successful business, conforms to this model or the variety of reasons why they choose not to.

 

[Electrics]

I respect your right to your opinion on this, but I am a little concerned with your terminology of "the lower classes" as i feel this is an unnecessary discrimination/subdivision with no boundaries defined and possibly offensive to some. You have absolutely no idea of my "class" nor what my business was, nor my outlook on life. I have and never had, any vision of being super-rich, but I'm ok!
Thus, in my opinion, a debt - free business model is a perfectly viable option, it suits some, but not everyone. That's my point, and I hope you respect it, even if you dismiss it as a model for your own circumstances.

People who aren't rich don't understand debt and how to use it. I'm from a council estate, not even 'working class', but 'benefit class' so there's no 'discrimination' going on.

How's about we all forget it's 2021 where people complain about their feelings and simply ignore comments we don't like instead of going all social justice on them?