This week Paul Stuart is joined by Jose and Daniel Gonzalez, where they discuss comparing the differences and similarities between being an employee installer vs. a subcontractor installer.

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The HUDDLE is where the flooring industry can get together and talk about everything! Lead by Paul Stuart from Go Carerra who is joined by Daniel and Jose Gonzalez from Preferred Flooring.

https://www.preferredflooringmi.com

https://www.stuartandassociates.com

what's up guys welcome to

the huddle it's a weekly discussion

about how to maintain forward progress

in your flooring career

today we're going to be talking about

employee versus subcontractor what's

best for you a quick introduction my

name is paul stewart i'm the founder and

ceo of go carrera and president of

stewart associates flooring company

located in wichita kansas

got daniel and i got jose with me from

preferred flooring what's up guys

hey what's up

how's the day

busy as always

nice flooring right

yeah flooring in life you gotta find

balance

yep

well hey i wanted to open the discussion

with

um

kind of

discussing our individual

uh experiences with the two different

kind of aspects of flooring uh

you know the employee and the

subcontractor

uh

what's your guys experience with that um

kind of set a baseline here between

three of us on

what what your guys's past and tells

what your experience is there and and

i'll share mine

okay um

i'll go ahead and start well you know

when when i started an industry i was uh

definitely under 10.99 um

i i didn't really

really know any different so so that was

where i started i did transition over to

uh w2 and play

at some point and you know they

they both have their place they both

have their benefit they both have their

drawbacks um

does it matter to me which one i'm

categorized

under now that i'm a little bit older it

does to some extent because you know my

my future is

my future feels to me better off uh

categorizing myself as an employee

versus the contractor because

items are taken care of for me and

there's a lot less work on the back end

for me to take care of on a personal

level um

with the government insurance and

retirement and all that so it just it

makes life a little bit easier um when

everything's kind of grouped together so

um preferably i would

say that i i like where i'm at as an

employee of our own business

at the moment yes

yeah we'll get into that a little bit

but i mean there's certainly other

options

uh if you are a sub and you own your own

business to be still an employee of that

business and that company

pay you as a employee so we can get into

some of that too

what about you daniel

you still came off as an employee didn't

you i know well

the wrong kind of employee the 1099

employee and

that's where this

i don't even think it's just the

flooring industry i think it's just

construction in general

tends to think that

that's okay and

and that's that's you know something

that people need to know that it's not

the right way to do things especially

when you are calling them an employee

and

they aren't

exactly working for themselves so i

started as um

what they would call a 1099 employee

right even though that's not really

a thing an employee's an employee

but for

for a few years i was on a 1099 and it

wasn't until

i went to go do my taxes and it's like

what i owe money like how is this even

possible like

and that's when

you kind of realize oh i've been paid

wrong this entire time and

what do you do from there

yeah a lot of guys have gotten stuck

from that deal and i think let's let's

take a minute to like clearly define the

difference because i think that's part

of it right i mean

daniel

and jose both of you guys sound like you

got started as 1099 thinking you were an

employee so to speak but

so

to define

the difference an employee

is paid a

in my there's my opinion and then

there's the legal uh version

uh you can pay an employee by the piece

as long as they make a certain dollar

figure and some of these things change

state by state some of the rules but in

general

uh they have to make a minimum they have

to make at least minimum wage even if

you're paying them by the peace if

you're going to

treat them as an employee now if you're

gonna do it that way you still need to

take out taxes

uh you know take care of their payroll

taxes take care of their income taxes

the whole works you still have to

encompass all that uh the most

traditional way and what in our opinion

is the best way to hire an employee is

hire them by the hour

uh pay their you know have them set up

they get work they have workman's comp

insurance under your company

uh they you know they are paid overtime

when they work over 40 hours and again

that's another thing that

changes state by state some of the

some states it's if you work over eight

hours in a day so it kind of depends

but the bottom line is

they're paid by the hour they have the

same benefits uh say vacation time uh

holiday pay those kinds of things that

maybe the office staff has

at our flooring company our hourly

installers have the same exact benefits

as our vice president

same health insurance provided by the

company same

same benefits with uh

vacation time and and holiday pay that

entire thing so that's my opinion

of what really having an hourly employee

is and then subcontractor is the 1099

guy that has to cover his own

insurance taxes those kinds of things

and i think where some people get caught

in this web is they're hired by the as

an hourly pay structure

but pay but

tax wise are treated as a 1099

uh

independent

contractor and so you you go working

for 15 bucks an hour

and at the end of the year you learn

that you owe

5 000 in taxes because the employer that

was

saying you were an employee and treating

you as an employee a lot of times which

is even worse meaning they

you got to be there at 7 00 a.m you

don't leave till 4 30 whatever those

time constraints are which

uh you know we get into compliance a lot

when you start talking about those

things because

you cannot have control over

that

subcontractor if you're paying them as a

1099 and you're not covering them

anywhere you're not taking care of their

unemployment insurance they're you're

not covering their employees

the employee stuff

then

um you know they're really not an

employee but at the end of the day

the pain that that causes to a lot of

installers who get started there

and they get behind on taxes and then

before you know it

taxes are a big item in their life a big

stress point so

that's that's kind of my uh

what's your guys's opinion is that

pretty accurate from uh yeah that's

that's pretty accurate and then you run

into the guys that

you know they don't know no better and

then once they

do find out that oh man i'm gonna oh

they just are like i'm just not even

gonna file

and they they try to go years and years

without doing it and then it's not until

some of these guys actually are like man

now i want to buy a house

but

because of the situation i put myself in

or the situation that

my employer has put me in by doing

things wrong

well i seem to remember us sitting on

the porch out in the country talking to

a certain installer that i won't name

but i mean those types of things was the

topic of conversation and everybody

sitting there it had something similar

that had happened you know they got

behind on taxes half the time they

didn't even know they owed taxes i know

people on this call

uh have been in the same position where

they got behind on taxes

and you know it was a

a major stressor in their life well i

did 100 you know and i did it to myself

um and i'll be transparent i'll be

honest

uh you know

first off i started out uh 1099 not

educated right like oh i'm making cash

i'm getting paid you know this is you

know under under the table type thing

he's just reporting it because he had to

show the money went somewhere

um and then once i found out about what

i had to owe

um

i was like

let me just kind of

dodge and duck as long as i can to try

to avoid it thinking it was going to go

away but no it didn't

um and it got to the point when i did

finally become a w-2 employee

um

i didn't want to raise any red flag so i

didn't even do my taxes when i was going

to receive a refund and all that did was

put me even more in the hole for

penalties and uh and interests uh and

you know and all that so it's there

there's there was a trickle effect

how did you deal with that i mean that

had to be major stress

you know um

when i i finally met my wife i

i had to make a decision right like if i

was gonna build a life and i was gonna

purchase a home and try to uh to raise a

family

um

i didn't want anything to be taken away

because it wasn't her fault and it

wouldn't be my kid's fault it was my

my

lack of knowledge that put me in that

situation my lack of uh

educating myself you know my pride right

not asking the right people the right

questions even though i kind of already

knew i should i just kind of avoided it

and

i called the irs

hey this is my name

i think i owe you some money okay you

are officially the first installer i've

ever met

i did as daniel dude

you know i just i didn't want it to come

back and bite me in the rear end

after i started doing things what i felt

was the right way you know and

i just didn't want to buy anybody else

either yeah no i mean kudos to you for

doing it i'm just saying that

it just keeps going generally and you're

you're talking the same you're telling

the same story that i've heard

for a long for

last several years that we've been

traveling

across the united states going to

different shows meeting with installers

all over the nation

it's a very similar problem

they didn't know any better they were

they the guidance they got was not good

they were young they got into flooring

they were getting you know 15 or 20 an

hour in cash it the money felt right uh

it felt good but at the end of the day

they didn't realize you know 20 of that

uh is going to uncle sam and they didn't

plan on it no but i really did not

just them knowing that that like

you know

there are options like the there's two

different ways of doing things now the

vast majority of flooring is

subcontracted and we i get that and and

go carrera supports that that's what it

was built for but we encourage

uh like

employment

in the true term of employee installer

to me

helps the industry to allow that that

individual to develop

now that that's not going to change the

industry i mean there's plenty of people

that believe that

you know employee installers are better

that that's a better path form

unfortunately you're never going to

squash or get rid of entrepreneurship

like we're entrepreneurs man i mean

you know i was a when i started i was

i started off as an hourly employee in

the flooring business um i made eight

bucks an hour to sweep floors and pick

up trash and

that kind of stuff

you know i stayed there for about four

years and even at the end of those four

years being mentored and and going

through uh being under some really good

installers after that four years uh that

company was getting ready to get bought

out so i went and started my own company

and i started subby

i i have seen every aspect of the

business

and i believe

that the decision between being a hourly

employee or a subcontractor

really boils down to your risk

appetite for risk and your ability to

execute on

uh

bookkeeping i mean it's pretty simple

stuff but it is important if you're

going to be a sub

uh you know we we grew our company very

quickly

and um

you know started to become a full

service flooring company a few years

later

because i paid myself as an employee i

paid myself 600 bucks a week as a sub

it didn't matter how much i made from

installing that went into the company i

took a 600 a week salary and i did that

for five years and that allowed the

company to grow and us to be able to put

back money and then start

full service supplying materials and

such

but

the that is not the path for everybody

and you just have to be honest with

yourself in my opinion

right like yeah some some people are

just better at being employees and

that's good that's fine we need the we

needed good quality employee installers

in this business as well

yeah

we definitely uh

definitely need to bring to the

forefront from the uh the implications

that someone could put themselves in to

help them decide what side of that line

they want to be on right um because it

can only

it can only help

uh

the construction industry and as a whole

not just flooring but everyone

um and

no we need to have an informed decision

like that at least give them the

information so if anybody's

watching this that you're you're a

flooring

subcontractor and you're behind on taxes

and you're like we feel your pain i

think that everybody's

sitting here has been in some version of

that at some point in our careers

the the the only way i think uh jose

brought up my

the this isn't tax advice but this is

just life advice go take care of it look

what jose did he went forward and said

hey i owe this money

i think i owe you this money anyway

i have no idea can you help me and you

know i attack the problem and go ahead

and

you know because it'll come back and and

bite you in the in the latter part of

your life when you want to buy a house

or a car or whatever

um

but back to the point you you guys have

hourly and subcontractors at your

company now correct correct

yeah we don't discriminate how do you

choose between that because i know that

over our uh business

life

there's probably eight or ten of our

subs that were hourly employees and we

actually helped them get into business

because we're not going to as we figure

we know what we've trained them to do is

an hourly and

i'm not going to stop them from chasing

their dream 100

i'm going to help them and i want to

continue to have them as a good resource

for installation for my company so

um how do you guys look at this how do

you determine

do you do you have a

determination on who should be a sub and

who should be an hourly or is it all

based on that guy

or girl

uh

historically like it's all based on the

person because we've had people as

employees that

have been like you know what this isn't

really for me i'm gonna start my own

thing and it's like

awesome if you need anything let us know

i mean um our ride on machines we've had

you know people use

if they don't have a tool here and

there's like here you go and it's like

you're not they're not even doing work

for us but we're still helping them out

because that's just

no one

ever really left on bad terms right and

it's like they always came to us like

hey this is what i'm thinking about it's

i'm not i can't keep you here man if

you're not happy you need to go do

something that's going to make you happy

and

um and then you know a few years later

we have them in here and doing a job

here and a job there and it just goes

like that but um right now what we do is

most of our stuff is in-house

and then

a lot of the residential were starting

to subcontract because

coming from a commercial background

we're just not as efficient

in that aspect

so if we can

offload that and that gives our guys

um room to focus on what they're good at

which is the commercial jobs yeah and

we're not we're not efficient it's not

because the lack of knowledge on our

part is because our

our focus has always been commercial and

that's what our our employees are

trained on was the commercial aspect so

every time we squeeze into some

residential here and there it is more of

a training process through the project

versus uh let's go get it done type of

process

well they run different there's no doubt

about it from a project management

standpoint the job's run different

uh let me ask you another question

what is the the biggest factor

uh that you see is why

somebody wants to be a subcontractor

versus be an employee

so what what what what's what's

motivating the guys you talked about

to to want to

leave a good company with

with the security of the hourly

installer

life what what what do you think

i think you like he said that's pretty

broad because we've had guys that

have left because they feel like they

just need to do things their way you

know exact words i need to do things my

way

okay have at it and

and then we have guys that

will see

a dollar figure and be like well if

you're making this much and i'm only

making this much that means that

i need to go do my own thing but those

are also the guys that once they start

doing their own thing it's like

one week they're

spending spending spending and then the

next you know

few weeks after that

it's

you know because the social media you

see everything it's posts about them

being broke and stuff so they they

really have no

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they don't have an idea of what it takes

and what it entails to

um gather the tools the insurance the

contacts and and try to

have everything you need at your

fingertips because it's

when you're out there and you buy it and

you've been in business for a little bit

and you've had some time to collect

everything to make the installs go

easier and you're an employee and you

have everything you need to do a job

from start to finish no matter what it

is it's a lot different than going out

on your own and all you have is knee

pads and a pouch it's totally different

you know no van no

so so some of the guys

so how do you stop so that's the key

right there in my opinion like if you

don't have the assets the tools the the

vehicle the the

the

let's call it just the starter kit to be

a sub i mean you got to have a vehicle

that's meant to do this you know a van

or an enclosed truck or something like

that you gotta have a work vehicle

and the proper tools to perform your

trade if you don't have the basics then

that should probably tell you to stay on

as an employee for a while and build

those

goals

build that stuff up buy your own tools

and buy your own thing and then you can

go

you know

out on your own later i think that one

of the

one of the things i've

um

recognized over the years is guys just

want to

um

like if they said we want to do it my i

want to do things my way from a

technical standpoint from a flooring

tech you know installation technique

standpoint that's not allowed like

you're still going to have to do it the

right way we're going to make sure

now if you're talking about

you don't want to get up at six and be

the office by seven and pick up your own

materials and then go to the job site

like more of our hourlies do

i get that like if you want to be your

own sub and

but there there really needs to be

almost this like starter kit the check

box do i have this do i have that do i

have this do i have that or prior to

going and being a subcontractor and if

you don't if you can't check all those

boxes you probably should stay as an

employee that's just

you know my two cents on it but

hey guys this is saying can you hear me

yeah what's up everybody hey how you

doing brother uh i'm doing good just

wanted to add to that topic you know um

so for me when i started yes i got the

van you know i got the tools the basic

tools to go ahead and start and as the

job requires additional stuff you know

you go ahead and invest whether you're

rented or you want to purchase it that's

kind of up to you

but what i also started doing because

when i realized look i'm not i don't i

don't want to grow my business while

doing the installation and i'm going to

find people to do the work and i have

people working for me i gave them like i

said look

i'm going to eat you guys like a

subcontractor

you are allowed to use my tools you are

allowed to take my vent until you guys

get up to a certain point you know and

that's what i started doing they drove

to my location to pick up my van and use

my tools and then they start you know

slowly building their own tools you know

with their pocket knives and

floor scrapers and stuff like that but

you know i still had the demo machine to

provide just to help them get going

because you know we're kind of helping

each other

so that was one way i guess you could

kind of start if you have

another business partner that could

provide you or support you with what you

don't have

yeah the only thing i see there uh

hussein and you can probably like

chime in here

is the liability of somebody

that's not an employee of your company

driving your vehicle

materials from one place to the other

and those types of deals can put you at

undue risk

so

you know having them as an employee

until they get there mitigate your risk

at least from a standpoint of personal

risk

because your insurance company would

want you to have them as an employee if

they're gonna be driving your vehicle so

that's just my two cents on that is if

you're gonna

you have to add them to your insurance

yes

yeah so

um

what what else do you see uh

daniel and jose on like

what are some of the

the biggest pros and cons um you know

everybody would say money for sub

because you can

make significant

money as a subcontractor but you got to

start checking off these boxes like

taxes insurance and things like that

that's a pro anacon i think because you

look at the money that you make but

not a lot of people talk about the

expenses that come with the amount of

money you're making either

and like you said you started you know

you were paying yourself a salary of

600. we started off paying

ourselves

half of what you were paying and this

this went on for a couple years and it's

like

was it hard absolutely and

would i do it again probably um but it's

it's a matter of

seeing that end goal and

actually knowing what you want it's uh

you

definitely spend a lot of

there's a lot of expenses that go into

running a business that a lot of people

don't see

and

that that's something that um a lot of

the organization organizations that are

out right now don't even talk about

which is

i understand why they don't but it's

frustrating that they don't because

they're you set someone up for failure

if you don't if you're not open and

honest about stuff like that and

expenses are

crazy

even

well that's why we're talking i mean

that's why we're having this

conversation is at the at the end of the

day here

there there's a ton of expenses if i

could give a sub any

guidance whatsoever is don't treat your

business because if you're a

subcontractor go open up

a llc or get a true business uh entity

consult again i want to make sure you

consult with an attorney and and an

accountant but this is my opinion

um open up an actual company structure

it's pretty cheap to open up a quick llc

and then pay yourself as an employee

put the money back

so that uh as you're paying yourself as

an employee you'll be taking out taxes

of what you pay every week and it helps

your dependency at the end of the year

or your your um

your com your commitment to the irs at

the end of the year if you're getting

money taken out weekly as an employee so

that's the first trip so you've been

paying your you every week you get paid

you're paying in to the irs until you're

and you're legal that way at the end of

the year if you didn't pay enough you'll

still owe but at least you've paid some

throughout the year

through your uh weekly payroll to

yourself so i would encourage every sub

to set themselves up as a company pay

yourself as an employee and don't treat

your company as a piggy bank it's not

just something that you made five

thousand dollars this week and you spend

five thousand dollars and that's that's

where that's where you get the guys and

i know we've you guys got a story about

facebook i'd like for you to kind of

chime in on but

that's where you get these stories of

guys being so far behind on their taxes

or they're broke all the time and it's

if you spend every dime you make and you

don't put that money to work for you

later and this is a bit of just business

and investment like

the the the

standard best practices i don't care

what industry you're in put 10 percent

back

for savings put 10 back

to to

for a rainy day and put 30 percent back

for taxes now if you can do that if you

do the math and that makes sense

okay

but those are just these baseline

figures that you should be figuring if

you think you're gonna make a thousand

dollars

in a week take a hundred put it aside

for your savings a hundred for a rainy

day right

300

for

um taxes and and and uh commitments for

there and then what do you have left

after you've taken 500 out

is a 500 so if that's still attractive

and you can make that work for you

by all means but

right too many times

the story like you guys uh were talking

about the other um in another

conversation we had is

i mean why don't you share that with us

i mean that's

the conversation going on on the west

michigan

page right

did you talk to him about it yes a

little bit ago yeah give him a little

bit of information on that sorry i'm

just he was gone when that was

conversation yeah no worries i mean just

kind of overview of yeah

on facebook

on facebook you know someone posts on

there that they're looking for someone

at a certain dollar amount

and then guys say that that they weren't

bashing but i mean i it's all

written right so maybe i read it wrong

but they're like

well i paid this much for i i won't pay

anyone less than this much or i start my

guys out at this much

and it's like

none of that matters if you're not

paying your guys correctly and they're

gonna end up having to pay their own

self-employment tax anyways

because if you think about it in the big

scheme of things they're complaining at

you know just throwing figures out there

if someone's paying someone 16 an hour

and you're like well i pay my guys 19 an

hour but you're paying them out of 10.99

so that's not a true 19 an hour because

if you

if you really break down how much an

employee costs at

i don't have the spreadsheet in front of

me but i'm i

i think the our cost

at uh 16 an hour somewhere around 22 an

hour is our

our all-in

yeah bear burden is somewhere average

around six bucks in an hour

yeah

so depending on retirement and

investment

yeah

yeah

and then yeah that's not even including

like

the the health care and all that yet so

it is it it starts getting up there

because you you don't think

you know you

a lot of these guys are going out there

and working and they're you know on a

1099 and they're not covered by comp so

if anything happens on the job site it's

like what happens then yeah you're not

protected cut your fingers off yeah

and you're not if if you're 1099

you don't and you don't have your own

insurance your own work comp insurance

um

yeah it's all that in my opinion i think

that's something that would be nice if

the industry would change not our

industry but the insurance industry i

think a 1099 guy

should have to have work com i mean me

that would take a lot of these

the guys that are playing as a company

uh almost you know they're not they

don't act like a company but they

install

and they're 10.99 it would it would take

those guys out of it and the only reason

i say this is for safety i mean

and at the end of the day

these are things guys don't think about

or things that

the installers aren't considering when

they're talking about going out on their

own um so i'm hoping that a discussion

an open discussion can kind of push the

you know how to at the end of the day

how are we going to move

forward progress

with

both employee installers and

subcontractors and i think it's just

really truly understanding the

difference between the two so you don't

get the wool pulled over your eyes when

you go talk to some retailer that's like

yeah man i'll you you can come work here

and i'll pay you 18 an hour and they're

like

and then at the end of the year it's

your story right

because that's the tax bill that's what

they kind of compare things to is you

can go work at mcdonald's and make that

amount of money but they're not taking

into

you know consideration that mcdonald's

is paying them out of w2

and then you get your whole benefits

package

and if you really just

just the simple stuff like paying

overtime

like on a 1099 these guys are working

straight time 100 of the time and

a lot of it is you know these guys that

are like i work 60 70 hours a week and

i'm doing fine well you're working 60 70

hours a week at you know 15 an hour

that's that's not fair for you guilty

well what you you brought up another

good point i mean what about

unemployment insurance so that you know

who's paying into unemployment for a

1099 nobody my dad was a painter uh

subcontractor as well i mean and he

never paid into unemployment insurance

ever and

at the end you know or

social security uh you know he needs

supplemented because he only has like

throughout his entire life he's only uh

he only contributed enough where he

makes three or four hundred bucks a

month

from social security because he was he

was an independent didn't pay himself as

an as a

as an employee so that you could start

paying into that right i've been

self-employed since i was 22 but i've

been paying into

my my unemployment my own unemployment

insurance my own um

you know um

social security all of that has been

paid since since i started the company

right and when you're an independent you

really don't think about

insurance because those plans aren't

necessarily

offered

you know if you're out on your own

unless you're doing like a traditional

or a roth ira and a lot of guys don't

even know what's out there for them to

contribute to

yeah and those are investments but just

regular insurance even i mean i'm

talking about pay

if you are just

taking in 1099 money and paying your

income taxes

but you're not paying into unemployment

right so you know a portion of every one

of our employees we have to match their

unemployment so that if they get laid

off or or you know whatever happens a

recession or whatever happens in the

world that if they're laid off there

they have you know the company has

money

in escrow with the state to pay

employees for the time that they're

unemployed right if they if they um

become unemployed those things don't

happen let alone social security i'm not

sure it'll be there by the time we all

get there or not but

you know my my dad never paid in and

that's why he has such a small amount

that comes into his

you know into him every year

so you know those are everything i think

like we need to think about as

installers when we're getting ready to

go

out on our own

i was lucky enough to have somebody tell

me just pay yourself as an employee

and you don't just you're not the bank

you don't get a thousand dollars from

your install that week and that's your

money you pay yourself in a

salary or a by the hour

whatever you make

goes into your company that's your

company's money and just you know i

think

having some of this knowledge that we've

been talking about on this call on this

conversation

can help a guy understand the real uh

commitment that it takes to do what

you guys have done what i've done is

literally

running your subcontract business like a

business

so

so

you know those are great points right

but if you started the business from

scratch and you know you you are paying

yourself

like i am not saying whatever you make

you spend but i kept most of the money

in the company if you can right if you

are the only person working

and you have to feed your family it's a

different story luckily my wife works

you know i can kind of take a lot more

risk and i don't have to take some

salary to myself but if you were to take

some salary to yourself you know you

gotta make sure that salary

is not going to bring your net income to

for your business to like negative right

you want to keep that

some income in there uh so that you

could basically what you're talking

about reinvest in the company

so

so throughout the years you know you

start building this i guess almost like

um

reserve

right now you you are able to

pay and you know pay your bills and pay

your guys it's going to take you to get

there a few years but once you get there

you have a much better cash flow that

you are able to wait for receiving your

payments your invoice but you're also

able to pay

i hope nobody goes out there and

whatever they get and they go spend

every week that's crazy

and then who's saying well i think a lot

of that happens

i know i know a lot of that happens and

i would also say that you do have to

start

when we talk when i'm talking about

paying yourself a salary

you you have to part of this is what are

your goals if you are just going to own

your job forever

make the salary big enough that i mean

like if you're just going to install

with your cousin as your helper and you

guys are going to run a really good

subcontract business but that's all you

ever wanted to be you never want to hire

more people you just want to have one

helper along with you the entire time i

would still say pay yourself a salary

whatever that dollar figure is

because

it just helps with you staying up on

your taxes and pay and unemployment

i mean for goodness sakes if the economy

took a downturn you're a sub and you've

been paying into unemployment for

forever you can be unemployed too so it

generates consistency too so if you like

uh i'll go back to the the loan type

deal you're going to go try to buy a

house or a car or something like that

you have consistency right because they

don't want to see one year you made you

know 50 grand the next year you made 80

grand and then the third year you made

30 grand they don't want to see that

they want to see some kind of

consistency they don't want to see

fluctuation in annual uh income either

and um and also to piggyback off what

hussein said he's right you

gotta keep money back into it when

when uh when we started it was dba and

we started as a dba and then uh

rolled into an llc and then classified

ourselves as employees right and that's

one thing people don't understand we've

said it a couple times that you pay

yourself as an employee

uh under llc

there are a lot more benefits to that

than you think there are dba man we put

ourselves in

not so good positions doing it that

route but yeah you're in a lot of you

put yourself in a lot of risk right in

the middle of a lot of risk

risk in the finances but once

once the llc was formed and we

restructured pretty much

the

the transition was a little hard at

first but the long-term benefits

outweigh the short-term uh discomfort of

not seeing

those dollars and cents right away um

like yeah i i would say that that

the um

you get

i mean again give with your accountants

but you have write-offs and things that

happen when you form a company and it

can help offset some of those costs like

your fuel costs and all these things

that are are business expenses now and

don't just come right out of your pocket

so i don't think that

hey if you if you know how to run a

company or you you've taken this

information and you're listening to it

you think i can do this i can be a sub i

can run then great just

i mean follow some of the you know

underlying

you know foundational principles we've

talked about but

if you're not

employee may be the best route for you

and that could be an employee with a

really good subcontractor i mean i know

a lot of guys that have 20 30 40 50

employees up even hundreds that are our

labor houses but they they pay their

guys as employees um and there are some

that do it wrong as well

but that's what this is for to try to

inform you to make sure you ask the

right questions from an employer if

you're a new installer you know say

you've been doing working for somebody

for

a a small subcontractor for eight years

and now you're going to

um

you know go out on your own

and and

be a sub as long as you understand the

parameters great on the other side of

that when you go if you wanted to go

work for somebody again don't get duped

into being paid like daniel was talking

as a 1099 guy and then tell you you're

an employee

you know

demand the right things if you're going

to be an employee i guess is what i'm

getting at there so right and there's

not

one isn't right and one isn't wrong

right because you can

pick and choose which one you want but

as an employer there is a right and

wrong way to pay an employee

you you yourself as the employer have to

actually figure out

all right i'm ready to go out on my own

but never be scared to ask people

questions because business is

it can it can get pretty confusing

there's a lot that goes into it so

definitely reach out to someone you

don't want to put yourself in the

position to where

now you want to buy a house and you

still can't even though

you're running your own thing

yeah don't get caught off guard 20 years

from now i mean we've talked about some

of the very f foundational pieces today

if you follow those you're going to be

in a heck of a lot better position than

you know i know some of us were

so

in closing here keep this thing right

close to 45 minutes every week we've

talked about the pros and cons

um

you know this this next week

you know we're going to be talking about

maybe you are a sub

image

what is the imager portraying you know

image isn't everything

but it's close

so how are you portraying yourself

that's on next week's episode of the

huddle um i want to

thank daniel and jose and

any um a couple other people that that

chimed in

and appreciate all the information and

good conversation guys you got anything

to say in closing here

no just i've i already said it don't

don't be scared to reach out to someone

that's already been through what you're

gonna go through because it's only gonna

help you out in the long run yeah

um and

i just wanna add like uh i'm a little

bit old school right and daniel brought

to the forefront a while ago for us that

there were organizations out there that

are geared around the installer and

helping educate and

people's

whether they believe it or not the

subcontractors were employed believe it

or not

everyone started somewhere and the the

majority of everyone who is in a

leadership role or position in the

flooring industry

a lot of them started where we did and

you know they they have a lot of

information that they're willing to

share it's not a secret it's not

anything they're trying to hide so try

to find an organization that fits uh

your model um do some research make some

phone calls um and

don't be shy man set pride aside

sometimes you know you're you got to put

put yourself in your family first and

there's something probably aside to ask

questions that you might be embarrassed

to ask or you might not even know you

have a question until somebody brings

something up

um

you know and

i think that uh

that is

the

maybe the best advice you can

have given is

ask questions we're going to be sharing

on this show

uh plenty of times different

organizations you can get in touch with

join this

join the the call we're we're on every

week on

every tuesday at 3 p.m central

and

send your questions in if you have any

questions we'll do our best to answer

them or we're going to have some really

great guests in the future that

that are going to be tied around uh you

know taxes and all this stuff we're

talking about but all this is built

around how to

build your career whether you're an

employee or a sub

and set yourself up for the best success

possible so with that i'm going to close

this call i want to thank the guys again

i really appreciate it and

i guess we'll see you guys next week

all right see ya