Washington D.C.
Starting a wood flooring business
from scratch



Washington DC Flooring Contractor Directory


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View from the balcony of one of the Watergate condominiums I did in Washington. The river is of course the Potomac. The bridge is the Key Bridge and and across the river is Roslyn, VA.

Starting the wood flooring business in Washington was quite the adventure. I offer it for those considering starting a business of their own and those who just like a good story.

We had moved to Washington D.C. (actually Arlington in Northern VA) Being new to the area we lived in a poorer part of town in a one bedroom apartment. We had twin 2 year old boys, a 5 year old daughter, and a small Pomeranian.( Is there any other kind?)

Our car had bit the dust on the move down so we were without a car. Fortunately we were on the bus route so my wife could get on a bus to the Pentagon Subway station and take the subway into Washington to work as a legal secretary for a large Washington D.C. law firm. We walked to the store or took a bus. I was the househusband and diaper changer(amazing how fast I potty trained the twins)

After living like this for about a year something happened. I decided to start doing wood floors again. The problems were I had no vehicle, and little money to work with. ( Does this sound familiar?)

I started by setting a goal (some people think that's a four letter word).....Wait a minute it is a four letter word. ?:) My goal was to get out the Yellow pages while the twins were napping and my daughter was in school and call 15 people who were already "in the door" and tell them what I do.

I met my goal everyday explaining that I had experience in wood floors and asking if they needed my services. I talked to carpet cleaners, painters, general contractors, interior designers.

I even went to returning calls that no one made. I had several Real Estate companies ask everyone in the office if they had called for someone to do some wood floors. Hey you can really get creative.

One day the phone rang and a general contractor called and he wanted me to look at a job in Silver Springs MD. OK here I am in Arlington, VA with no car and I get a call for a job in Silver Springs,MD

I found a sitter for the twins and got on the bus. The bus took me to the Pentagon where I got on the subway (Washington has a great subway system incidently)and went to Silver Springs MD.

After arriving at Silver Springs I realized I didn't have a map. I found the address on the map at the subway station. After walking 8 blocks, I did the estimate and got the job.

The very next day I woke my neighbor who I knew was a taxicab driver and asked him if he wanted to make some money. I found out that my drum sander would fit in the trunk of a taxicab. My drum sander weighs over 150 pounds. He took me and my equipment all the way to the job in Silver Springs.

The job was sanding and refinishing all the wood floors in the whole house. This meant doing half of it at a time. We moved all the furniture into one half of the house and I started sanding half the house.

Before I was done with the first half her next door neighbor decided she wanted her whole house done too!!! No problem!! I just carried the equipment next door.

Now at this time I only had a drum sander and paper but no edger. I solved this little problem by getting on the bus, getting off at the rental store, renting an edger, and getting back on the bus. While the bus was taking me to the Pentagon subway station another passenger asked me if that was a floor edger I had there. I said," Yes". He said," That's interesting. I'm thinking about doing wood floors at my house this weekend.

Without even thinking I responded," Really!!! need some help?" After we talked about it for a bit we made arrangemnts for me to help him sand his wood floors in ....Alexandria, VA of all places.

He came and picked me up Saturday morning and took me to Silver Springs, MD. At this point I had both halves of the houses sanded and was putting on finish. He waited while I put a coat on both houses and then we loaded up everything and brought it back to Alexandria, VA.

He ran the edger and I ran the drum sander and we got his house done that weekend. He then took me and my equipment all the way back to Silver Springs where I finished the houses.

I did a couple more houses out of the trunk of a taxicab. I did it once too often and the customer asked, "Don't you have a car?" I said," No. I use a taxicab." He said, " I have a car for sale. Would you consider doing my floors in exchange for the car?" I ended up with a car and he ended up with refinished floors. I was in business.

Computer Forensics and Electronic Discovery Seminar

More information about starting a small business

Here are some facts about how to start a small business.
Starting a Small Business Starting and managing a business takes
motivation, desire and talent. It also takes research and
planning. Lack of planning is one of the leading causes of
business failures. Developing a business plan will walk you
through the questions that every prospective or new business
owner should answer. Before you start your plan, carefully
research and answer these basic questions:

* What niche will my business fill?
* What services or products will I sell?
* Is my idea practical, and will it fill a need?
* Who is my competition?
* What is my business's advantage over existing firms?
* Can I deliver a better quality service?
* Can I create a demand for my business?

Once you've determined that your idea is feasible, answer these
questions:

* What skills and experience do I bring to the business?
* What will be my legal structure?
* How will my company's business records be maintained?
* What insurance coverage will I need?
* What equipment or supplies will I need?
* How will I compensate myself?
* What are my resources?
* What financing will I need?
* Where will my business be located?
* What will I name my business?

If you are starting a home-based business, you will want to answer these additional questions:

* Does my home have the space (preferably separate) for a business?
* Can I successfully run the business from my home?
* Can I deal with the isolation of working from home?

Your answers to these questions will help you create a focused,
well- researched business plan that should serve as a blueprint.
The plan should detail how the business will be operated,
managed and capitalized.

Research Resources

Some questions you will be able to answer on your own, others
will require careful research. There are many sources available
to help you find the answers and make informed decisions. The
SBA's business information centers, located throughout the
country, offer the latest in high-technology hardware, software
and telecommunications to help you in your research. BICs offer
electronic bulletin boards, computer databases, on-line informa-
tion exchange, periodicals and brochures, counseling,
videotapes, reference materials, texts, start-up guides,
application software, computer tutorials and interactive media.

One-on-one counseling with seasoned business veterans is
available through the SBA-affiliated Service Corps of Retired
Executives, also known as SCORE.

Other sources include -

* trade association studies, journal articles and trade shows;
* regional planning organization studies on growth trends;
* banks, realtors and insurance companies; and
* customer surveys in your market area, which you can conduct
on your own or may already exist.

The Business Plan Your business plan should cover the business
basics.

Executive Summary

* Describe in detail the business and its goals.
* Identify the business ownership and the legal structure.
* Discuss skills and experience you and your partners bring to the business.
* Identify advantages you and your business have over your competitors.

Operations

* Explain how the business will be managed on a day-to-day basis.
* Discuss hiring and personnel procedures.
* Discuss insurance, lease or rent agreements, and issues pertinent
to your business.
* Account for the equipment necessary to produce your products or services.
* Account for production and delivery of products and services.

Marketing

* Describe your products/services.
* Identify the customer demand for your product/service.
* Identify your market, including its size, location and demographics.
* Explain how your product/service will be advertised and marketed.
* Explain your pricing strategy.

Financial Management

* Explain the source and amount of initial equity capital.
* Estimate start-up costs.
* Project operating expenses.
* Develop a monthly operating budget for the first year.
* Develop an expected return on investment (ROI) and monthly cash flow
for the first year.
* Provide projected income statements and balance sheets for
a two-year period.
* Discuss your break-even point.
* Explain your personal balance sheet and method of compensation.
* Discuss who will maintain your accounting records and how
the records will be kept.
* Provide "what if" statements that address alternative approaches to
any problem that may develop.

Legal Requirements

Small businesses must comply with federal, state and local laws
and regula- tions. You need to be informed about the legal
requirements affecting your business. Be sure to check with
your state department of labor and county government. You may
want to consult with an attorney for additional com- pliance
assistance.

Registration and accounting requirements:

You may need a -
* work certificate or a license from the state (your business's
name also may need to be registered with the state),
* sales tax number, and * separate business bank account.

If your business has employees, you are responsible for -
* withholding income and social security taxes, and
* complying with laws covering employee health and safety and minimum-
wage.

The U.S. Business Advisor, a World Wide Web site found at
http://www.business.gov, can help you identify and comply with
federal regulations, and links you to the Internal Revenue
Service, the Social Security Administration, the Occupational
Safety and Health Administration, and numerous other federal
agencies. You can also obtain federal tax information by
calling the IRS at 800-TAX-FORM.

A home-based business is subject to many of the same laws and
regulations affecting other businesses and some additional ones
also.

Zoning: Be aware of your city's zoning regulations. If your
business operates in violation of them, you could be fined or
closed down.

Restrictions on certain goods: Most states outlaw home
production of fire- works, drugs, poisons, explosives, sanitary
or medical products, and toys. Some states also prohibit
home-based businesses from making food, drink or clothing.

Understanding Your Market Market evaluation is critical and
provides the basic data that will deter- mine if and where you
can successfully sell your product or service. This process
involves defining your goals, scrutinizing your competition and
your customer base, and interviewing potential suppliers. The
information col- lected can help you, if necessary, adapt your
product or service to better meet customer needs.

Market research can help you -
* create primary and alternative sales approaches to a given market,
* make profit projections from a more accurate database,
* organize marketing activities,
* develop critical short/mid-term sales goals and establish the
market'sprofit boundaries, and
* identify your differential advantage, i.e., what makes your business
different from similar businesses with similar products.

Questions To Ask Your research should answer these basic questions:

* Who are your customers?
* Where are they located?
* What are their needs and resources?
* Is the service or product essential in their operations or activities?
* Can the customer afford the service or product?
* Where can you create a demand for the service or product?
* Can you compete effectively in price, quality and delivery?
* How many competitors provide the same service or product?
* What is the general economy of your service or product area?
* What areas within your market are declining or growing?

Research on competitors is extremely important. Visit industry
trade shows to find out what your competitors are selling and
how they are marketing their products. Similarly, stay current
on industry magazines and publica- tions.

Do not view market research as a one-time activity. Once you
establish your business, you should continually be in touch with
your customers. You may have to adapt your product/service
and/or marketing strategy to keep up with your customers'
changing needs.

Pricing Your Products and Services

There are several pricing strategies; select the approach that
will make your goods or services the most competitive and will
help you reach your profit goals.

Retail Cost and Pricing

A common pricing practice among small businesses is to follow
the manu- facturer's suggested retail price. The suggested
retail price is easy to use, but it doesn't adequately account
for the element of competition.

Pricing Below Competition

This strategy reduces the profit margin per sale; it requires
you to reduce your costs and -
* obtain the best prices possible for merchandise,
* locate the business in an inexpensive location or facility,
* closely control inventory,
* limit product lines to fast-moving items,
* design advertising to concentrate on price specials, and
* limit non-essential services.

One word of caution: pricing goods below the competition can be
difficult to sustain because every cost component must be
constantly monitored and adjusted. It also exposes you to
pricing wars. A competitor can match the lower price, leaving
you out in the cold.

Pricing Above Competition

This strategy is possible when price is not the customer's
greatest concern. Considerations important enough for customers
to justify paying higher prices include -

* service considerations, including delivery, speed of service,
satisfaction in handling customer complaints, knowledge
of product or service, and helpful, friendly employees;
* a convenient or exclusive location; and
* exclusive merchandise.

Price Lining

This strategy targets a precise segment of the buying public by
carrying products in a specific price range only. For example, a
store may wish to attract customers willing to pay over $50 for
a purse. Price lining has certain advantages:

* ease of selection for customers;
* reduced inventory; and
* reduced storage costs, due to smaller inventory.

Multiple Pricing

This approach involves selling a number of units for a single
price, for example, two items for $1.98. This is useful for
low-cost consumer products, such as shampoo or toothpaste. Many
stores find this an attractive pricing strategy for sales and
year-end clearances.

Cost Factors and Pricing

Every component of a service or product has a different,
specific cost. Many small firms fail to analyze each component
of their commodity's total cost, and therefore fail to price
profitably. Once you do this analysis, set your prices to
maximize profits and eliminate any unprofitable service.

Cost components include material, labor and overhead costs.
Material costs are the costs of all materials found in the final
product, such as the wood, glue and other materials used in
manufacturing a chair.

Labor costs are the costs of the work that goes into the
manufacturing of a product. An example would be the wages of all
production-line workers pro- ducing a certain commodity. The
direct labor costs are derived by multiply- ing the cost of
labor per hour by the number of personnel hours needed to
complete the job. Remember to use not only the hourly wage but
also the dollar value of fringe benefits. These include social
security, workers' compensation, unemployment compensation,
insurance, retirement benefits and so forth.

Overhead costs are any costs not readily identifiable with a
particular product. These costs include indirect materials, such
as supplies, heat and light, depreciation, taxes, rent,
advertising, transportation and insurance. Overhead costs also
cover indirect labor costs, such as clerical, legal and
janitorial services. Be sure to include shipping, handling
and/or storage as well as other cost components. Part of the
overhead costs must be al- located to each service performed or
product produced. The overhead rate can be expressed as a
percentage or an hourly rate. It is also important to adjust
your overhead costs annually. Charges must be revised to reflect
in- flation and higher benefit rates. It's best to project the
costs semi- annally, including increased executive salaries and
other projected costs.

Understanding Cash Flow

Failure to properly plan cash flow is one of the leading causes
of small business failures. Understanding the basics will help
you better manage your cash flow.

Your business's monetary supply can exist either as cash on hand
or in a business checking account available to meet expenses. A
sufficient cash flow covers your business by meeting obligations
(i.e., paying bills), serving as a cushion in case of
emergencies, and providing investment capital.

The Operating Cycle

The operating cycle is the system through which cash flows, from
the pur- chase of inventory through the collection of accounts
receivable. It measures the flow of assets into cash.

For example, your operating cycle may begin with both cash and
inventory on hand. Typically, additional inventory is purchased
on account to guarantee that you will not deplete your stock as
sales are made. Your sales will con- sist of cash sales and
accounts receivable credit sales, usually paid 30 days after the
original purchase date. This applies to both the inventory you
purchase and the products you sell. When you make payment for
inventory, both cash and accounts payable are reduced. Thirty
days after the sale of your inventory, receivables are usually
collected, increasing your cash. Now your cash has completed its
flow through the operating cycle, and the process is ready to
begin again.

Current Assets Cash and other balance-sheet items that convert
into cash within 12 months are referred to as current assets.
Typical current assets include cash, marketable securities,
receivables and prepaid expenses.

Cash-Flow Analysis

Cash-flow analysis should show whether your daily operations
generate enough cash to meet your obligations, and how major
outflows of cash to pay your obligations relate to major inflows
of cash from sales. As a result, you can tell if inflows and
outflows from your operation combine to result in a positive
cash flow or in a net drain. Any significant changes over time
will also appear. Understanding this will lead to better control
of your cash flows and will allow adequate time to plan and
prepare for the growth of your business.

It is best to have enough cash on hand each month to pay the
cash obliga- tions of the following month. A monthly cash-flow
projection helps to identify and eliminate deficiencies or
surpluses in cash and to compare actual figures to past months.
When cash-flow deficiencies are found, business financial plans
must be altered to provide more cash. When excess cash is
revealed, it might indicate excessive borrowing or idle money
that could be invested. The objective is to develop a plan that
will provide a well-balanced cash flow.

Planning a Positive Cash Flow

Your business can increase cash reserves in a number of ways.

* Collecting receivables: Actively manage accounts receivable
and quickly collect overdue accounts. You stand to lose revenues
if your collection policies are not aggressive. The longer your
customer's balance remains unpaid, the less likely it is that you
will receive full payment.

* Tightening credit requirements: As credit and terms become
more stringent, more customers must pay cash for their
purchases, thereby increasing the cash on hand and reducing the
bad-debt expense. While tightening credit is helpful in the
short run, it may not be advantageous in the long run. Looser
credit allows more customers the opportunity to purchase your
products or services. You should measure, however, any
consequent increase in sales against a possible increase in
bad-debt expenses.

* Taking out short-term loans: Loans from various financial
institutions are often necessary for covering short-term
cash-flow problems. Revolving credit lines and equity loans are
types of credit used in this situation.

* Increasing your sales: Increased sales would appear to
increase cash flow. However, if large portions of your sales
are made on credit, when sales increase, your accounts
receivable increase, not your cash. Meanwhile, inventory is
depleted and must be replaced. Because receivables usually will
not be collected until 30 days after sales, a substantial
increase in sales can quickly deplete your firm's cash reserves.

Finding an Accountant

If you decide to hire an accountant, find someone who is
knowledgeable, capable and discreet. With the ever-changing
complexities of tax laws and developments in accounting methods,
it is important to look for an ac- countant who takes advantage
of educational seminars, professional publi- cations and other
continuing-education opportunities. Professional ac- countants
are listed in telephone directories under accountants, public
accountants, bookkeepers and tax preparers. Look for references
or recom- mendations from local business associates, your banker
or attorney.

Raising Money For a Small Business

One key to a successful business start-up and expansion is your
ability to obtain and secure appropriate financing. Raising
capital is the most basic of all business activities. There are
several sources to consider when looking for financing. Explore
all of your options before making a decision. These include -

* personal savings,
* friends and relatives,
* credit cards
* banks and credit unions, and
* venture-capital firms.

Borrowing Money

To be successful in obtaining a loan, you must be prepared and
organized. You must know exactly how much money you need, why
you need it and how you will pay it back. You must be aware of
the bank's loan policies. Lending institutions generally
require fully secured loans and sufficient commit- ment of
capital by the borrower.

Types of Business Loans Short-Term Loans: Short-term loans are
paid back in less than one year. Types of short-term loans are -

* working-capital loans,
* accounts-receivable loans and
* revolving lines of credit.

Long-Term Loans: Long-term loans have maturities greater than
one year but usually less than seven years. Real estate and
equipment loans may have maturities of up to 25 years. Long-term
loans are used for major business expenses, such as -

* equipment,
* furniture and fixtures,
* vehicles,
* commercial mortgages and
* real estate.

Applying For a Loan Approval of your loan request depends on how
well you present yourself, your business plan and your financial
needs to a lender or investor. The best way to improve your
chances of obtaining a loan is to prepare a thoughtful and
professional-looking proposal. The proposal is your business
plan with a few important additions:

* In the Executive Summary, state the purpose of the loan and
the exact amount required. Explain specifically what the loan
will be used for and why it is needed.
* In the Financial Information section, include personal financial
state-ments on yourself and other principal owners of the business if
this will be a partnership. Also identify the collateral you would be
willing to pledge as security for the loan.

What Lenders Look For

Many loan officers will order a copy of your credit report
from a credit- reporting agency. Therefore, you should work with
these agencies to help them present an accurate picture of
yourself. The lender will also look at your work history and
letters of recommendation. Using the credit report and the
information you have provided, the lending officer will consider
the following issues:

* Do you have a sound record of credit-worthiness?
* Do you have sufficient experience and training to operate a
successful business?
* Have you prepared a loan proposal and business plan that
demonstrate your understanding of, and commitment to, the
success of the business?

SBA Financial Assistance Programs

The SBA offers a variety of financing options for small
businesses. The SBA's assistance usually is in the form of loan
guaranties. The SBA guarantees loans made by banks and other
private lenders to small business clients. Generally, the SBA
can guarantee up to $750,000 or 75 percent of the total loan
value, whichever is less. The average size of an SBA- guaranteed
loan is $175,000, and the average maturity is about eight years.

Whether you are looking for a long-term loan, a general
working-capital loan, a revolving line of credit or a microloan,
the SBA has a financing program to fit your needs.

For More Information

Information is power. Make it your business
to know what is available, where to get it and, most
importantly, how to use it. Sources of information in- clude:

* U.S. Small Business Administration SBA District Offices
* Small Business Development Centers (SBDCs)
* Service Corps of Retired Executives (SCORE)
* SBA OnLine (electronic bulletin board)
* Business Information Centers (BICs)

The SBA has offices located throughout the United States. For
the one nearest you, look under "U.S. Government" in your
telephone directory, or call the SBA Answer Desk at (800)
8-ASK-SBA. To send a fax to the SBA, dial (202) 205-7064. For
the hearing impaired, the TDD number is (704) 344-6640.

To access the agency's electronic public information services,
you may call the following:

* SBA OnLine: electronic bulletin board - modem and computer required
(800) 697-4636 (limited access)
(900) 463-4636 (full access)
(202) 401-9600 (D.C. metro area)

Internet: using uniform resource locators(URLs)
SBA Home Page: http://www.sba.gov
SBA gopher: gopher://gopher.sba.gov
File transfer protocol: ftp://ftp.sba.gov
Telnet: telnet://sbaonline.sba.gov
U.S. Business Advisor: http://www.business.gov

You also may request a free copy of The Resource Directory for
Small Business Management, a listing of for-sale publications
and videotapes, from your local SBA office or the SBA Answer
Desk.

Other Sources

* State economic development agencies
* Chambers of commerce
* Local colleges and universities
* Libraries
* Manufacturers and suppliers of small business products and services
* Small business or industry trade associations

This is repair work inside a Watergate Condominium. Water has a tendency to seep under the sliding glass doors and cause a lot of water damage.

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Home Equity Loans Center

Direct lenders offer debt consolidation and investment advice.
Inquire about a refinance loan or a second-mortgage home equity loan.

The floors in this Watergate condo are 9 x 9 squares. I am removing the old adhesive in this picture to get ready to replace the tiles I have removed. These tiles are tongue and grooved on all four sides making the repair a bit tricky.