Chapter 4: The Complete Business Plan A- Z, 1- 10, and soup to nuts!

 Starting your own business.  How to set it up, how to market your skills, how to gain contracts and customers.

Sole Proprietor or LLC? 

Sole Proprietor or LLC?

I recommend that you operate as a Sole Proprietor at first.  Don’t spend a lot of money setting up your business.  Wait and see if you can get it going and make a profit.  Then you can claim any profit of the first year on your taxes as a Sole Proprietor.

After you have some successes under your belt and you really want to make a go of it you can meet with a CPA and iron out the details of forming an LLC.  All that you need is a name for your business and a tax number.  You can get all of this by using an online legal assistance site like Legal Zoom. www.legalzoom.com

Insurance & Contracts

I have always insisted that my homeowners who have my furniture in their home have it insured by their Home owner’s policy. I write the amount that my items should be insured for right into the contract. The home owner needs to contact their insurance company and possibly get a Rider.   Other wise you may want to ask your insurance agent for sole business insurance.  You can get sample contracts and all business forms from Legal Zoom or other online places like the Small Business Association. www.sba.gov

See Chapter 7 for a sample contract as well as other handouts and marketing materials.

The home staging consult verses the home staging takeover.

All the way? Or just advice?

How much to charge for a simple consult.
My feeling is that it is best to charge $150 for a consultation.  A consultation usually takes about 2 hours plus travel time.  If the location is not close by I charge more money. Especially with the recent surge in the price of gas!   Most stagers charge more money than this but they really cut out a lot of potential clients who feel that they cannot afford the price and who are unsure of the value of staging.

A two hour consult has the value of getting you word of mouth referrals from the pleased home seller and their realtor.  It gives you the opportunity of free advertising and potentially more business.  Stagers to the stars will definitely charge more money because they feel they are marketing to a wealthy crowd ( so up your price in California, Manhattan, The Hamptons and Greenwich, Connecticut!).  But the average Home Stager is appealing to the average customer who is often selling their home because they need money.  So you have to choose between a lot of business at a fair price or fewer jobs at a higher price for the more exclusive client.

No free rides:  Often times you will get a request for you to give a bid on a home staging job that involves actual placement of furniture and decor.  When I first started out I gave free estimates but that didn’t last long.  Your estimate and bid for a job reveals all your plans and ideas and you are giving them the actual consult and advice for free.

So unless you are just trying to get a foot in the door you should charge the same price as your consultation fee to give an estimate.  Now of course if you have a steady working relationship with a builder or realtor you  will do your estimates for free because you are pretty much assured of getting the job.  At that point your realtor will let you into the home alone so you can get an idea of what needs to be done.

Find out who is paying.
If the homeowner is paying for your services try to make the initial visit with the homeowner present.  The owner is really the one you need to convince to hire you not the realtor.  I have had agreements to proceed with a realtor and then found that the homeowner was not on board.  Sometimes it is not possible to meet the owner of a home  but atleast try to speak with them on the phone.

How much to charge for a soup to nuts job.

Soup to Nuts Job

A soup to nuts job is a lot different than a simple 2 hour consultation.  The soup to nuts job is often an empty home or a home that needs alot of updating, decorating, furnishing or repair.  It can be a home that is newly built and never lived in, a home that is from an estate or a home whose owner has already moved.

The soup to nuts job has two possible scenarios.  The first option is that you provide a bid to the owner covering all of the work that can possibly be done in a certain time frame.  With this option you subcontract all of the work and oversee everything yourself.

The second option is that you refer the homeowner to names of selected contractors with whom  you have developed a relationship.  The owner hires those people based on your suggestions of what needs to be done. They hire the painter you suggest the colors, they hire the floorer,  you suggest the products and finishes.  This  can make it easier for you and keep you less involved.  You have less headaches and less responsibility.  In this scenario however, you  the stager would be adding furniture and accessories to do the actual temporary staging.

Hire your own contractors or simply refer the jobs out?

Once you have determined whether you want to go with scenario one or two you have to find reliable contractors who will be readily available to take the jobs.  Time is of the essence.  Often the realtor wants to put the house on the market pronto and doesn’t want to wait for you to finish staging.  ( mistake – but more on that later).

But that is the reason you need to have contractors who will be available immediately after you call them.  I had a flooring company who I would notify every time I had a staging consult.  I would call up and say “I am going on a consult Wednesday, keep Thursday open in case they need flooring”.  That way  I could tell the homeowner; “I really recommend replacing this carpet- Mr.  Jones can come to give you an estimate tomorrow and can have your carpet installed within a week if you choose stock carpet.”

This really influenced the homeowner to use my contractor and gave the contractor lot of business.  It made me seem more successful with the realtors when they saw how quickly I could get the home ready for market.

Whether you get a referral fee from your contractors or not you are helping yourself by associating yourself with reliable contractors who will be available to work on short notice.

You may already know some of these people .  Try to have a couple from each category with whom you can establish a relationship.  There are many places to find reliable businesses but mostly it is through word of mouth.  You can check websites like Angie’s List and Service Master for names of reputable contractors as well.  www.angieslist.com, www.servicemagic.com

Marketing that works!

Knock on Those Realtors Doors!

Knock!

My first home staging clients came from Realtors that I knew who were friends and  associates.  There were also many  realtors  in my area that I knew as acquaintances but not as friends.  I went out on a limb and reconnected with them as well.

• I visited every real estate office in my area.
•  I offered free home staging inservices for their staff meetings.
•  I distributed my brochures when I could get access to the mail room.
•  I visited Realtors at the Tuesday Broker’s Opens* and Sunday Public Open houses in my area to offer my services.

Other Efforts that were worth it:

I emailed everyone on my email list to let them know I was starting a home staging business.

I hung up flyers at the supermarket with the tear off slips with my website and phone number.

I had magnetic signs made for all our cars as well as the cars of close friends and family who would be willing to be embarrassed by my ad on their car.

We also parked our car with the sign in a visible place at our local shopping center for the whole day on Saturdays and Sundays.

*Brokers opens are open houses for realtors only that are usually held just when a house is first listed.