Michael Mettlach - Start a 6-Figure Junk Removal Business

Start a 6-Figure Junk Removal Business

Copyright 2016 by Snap Enterprise LLC

All rights reserved. This book or any portionthereof may not be reproduced or used in any manner whatsoeverwithout the express written permission of the publisher except forthe use of brief quotations in a book review.

Snap Enterprise LLC

14018 Pine Meadow Ln

Tomball, TX 77377

Simple business snapshot

At its core the junk removal business isrelatively simple. You go to peoples houses and haul away thetrash they tell you to get rid of. They pay you to take it, and youhaul it to your local landfill and pay to dump it. I believe thesimplicity of this business is what attracts me and so many otherpeople to it, but despite this simplicity, there are many detailsinvolved in the daily operations of a junk hauling business thatcan trip a beginner up or temporarily halt their success. My goalin writing this book is to provide you with a clear path, free fromfear of the unknown, to setting up and running a profitable junkremoval business.

So how does a day in a junk removal businesstypically unfold? Hopefully youll wake up before your alarm goesto the sound of your business phone ringing. On the other end willbe a potential customer wondering how your service and pricingworks, and how soon you can make it out to haul off their householditems and furniture from their recent move. Youll schedule themfor later that day if you have time, or maybe for the next day ortwo depending on your schedule. Then youll wake up and get readyfor work. Your labor helper/driver will then show up and drive youto the local landfill first thing in the morning to dump yourprevious days load. After spending 40 minutes in traffic andanother 20 at the landfill sitting in line and then dumping, youreready for your first job of the day. You pay $75 at the landfillbecause your trash weighed a little over a ton and they charged youby weight.

So you map your first job of the day and thenyou call the customer (or text) to tell them youre in route andyoure about forty minutes away. On a typical decent day you mighthave 3 different jobs spaced 2 to 3 hours apart. On your way to thefirst job you might get a few more calls, some will betelemarketers, some will be customers just seeking information onpricing but are too cheap, and maybe one in five will be an actualscheduling paying customer. Its a good thing you have a driver tofree up your time to answer calls and schedule jobs. Forty minuteslater you show up to job number one. Its a garage clean out. Youload up a couch, a loveseat, some random boxes of household goods,and some scrap lumber out of the garage. The customer tries to getyou to take some paint and oil, but you decline, its against yourpolicy (and illegal for you to take). All in all it takes you only15 minutes to load, but you charge $200 plus tax, because it filledhalf your trailer, and you charge based on volume, not time. Theyhand you a check, and then your team is off to the next job.

You map job #2 to then call the customer andtell them youre on the way. But wait, youre running early and thecustomer cant make it early because they are too far away. Bummer,looks like you have to go waste some time at a gas station near thejob and pay your worker to do nothing for half an hour. After youburn 30 minutes you spend another 30 minutes on the way to the nextjob. You arrive and surprise surprise, they have a big screen TVthat they forgot to tell you was upstairs, and their recliningcouch is upstairs as well. You and your worker proceed to musclethe heavy couch downstairs avoiding scraping paint on the walls andrubbing the doorway as you exit, and then decide that the bigscreen rear projection TV is too precariously heavy and awkward tomaneuver downstairs and around corners, so you spend another 20minutes taking it apart upstairs by unscrewing and unbolting a fewfasteners, and finally whisk it down the stairs in 3 or 4 pieces,safely and easily. The customer contemplates and then decides toadd an old rusty BBQ pit to the load. You charge them $150 plus taxand they pay with a credit card. Even though you still have aboutan eighth of your trailer still empty, you decide you had bettertake this load to the landfill, because you know an eighth of atrailer is not sufficient space to accommodate the next job, whichis a large construction waste job. You spend another 40 minutes intraffic and then another 20 minutes at the landfill dumping. Youend up spending $64 at the dump ($44 per ton minimum, plus $25pull-off fee, plus taxes). Looks like you made $286 ($350-$64) onthis load before overhead and various expenses, not bad.

Finally you head to your 3rd and last job ofthe day. You let the customer know youre on the way and on your 30minute trek to the gig you return 2 phone calls that you missedwhile you were at the landfill. One of them pans out and youschedule another garage clean out for the next day. After thirtyminutes you arrive at job number 3. You knock on the door and thecustomer proceeds to escort you to a monstrous pile of boards,sheet rock, kitchen cabinets, and some branches in the back yard,about 40 feet away from where you could park your trailer. Youinform the customer that you do charge a little extra forconstruction waste because of the weight involved and difficulty inloading, and after a little hesitation, they agree that this is noproblem and tell you to get started. Its a good thing that youbrought a garden cart and a wheel barrow, otherwise thisconstruction waste job would take FOREVER. Two hours and a lot ofsweat later, you and your helper finally finish loading theremodeling waste heap. It is a completely full trailer, and thensome. You get paid a whopping $450 plus tax, and you dont feel badcharging it because a roll-off container would cost the customeralmost as much, but it wouldnt load itself. Unfortunately thelandfill is closing before you have time to get there, especiallysince its rush hour traffic, so you and your helper drive back toyour facility. You figure youll end up spending $115 dollarsdumping todays load the next day since a trailer load ofconstruction waste is typically about 2 tons.

Now lets examine what the business made onthis realistic hypothetical day:

Revenue = 200 + 150 + 450 = $800

Dump fees = 64 + 115 = $179

Labor (helper)= 8 hrs x 13/hr = $104

Labor (you) = 8 hrs x 13/hr = $104

Marketing expense (10% of revenue average) =800 x .10 = $80

Vehicle expense = $0.55 per mile x 120 miles= $66

Prorated insurance, facility, phone, otheroverhead = $40 (estimated)

Business Profit = 800-179-104-104-80-66-40 =$227

So in a typical day, running one crew and onetruck, it is not unreasonable for your junk removal business tomake around $200 dollars, not including whatever wage you decide toallocate to yourself if you are doing some of your own labor. Youmight conclude that on this typical day you personally made about$331 ($227 + $104 labor) depending on how you want to look at it.If you can consistently meet a sales goal of $800 a day 250 days ayear at a 25% profit margin ($200 a day), your business stands toprofit $50,000 for each crew you are running.

Unfortunately, while these calculations arenot unrealistic, they are somewhat idealistic and do not reflectall the problems that can and will occur during the daily operationof a junk removal business, nor do they represent some of thepleasant surprises you will encounter that will make your businessmore profitable. Such is the purpose of the discourse contained inthe rest of this book.