I Ain’t Got No Overhead

Many painting contractors believe that they have no overhead. They are simply wrong. To claim that one has no overhead means:

1. There is no advertising
2. There is no insurance
3. There is no equipment
4. There are no vehicles
5. There are no phones
6. There are no salaries
7. There are no office supplies
8. There are no accounting or legal expenses
9. And the list could go on

All of the above items are overhead. I’ve spoken to hundreds of contractors over the years, and I’ve yet to meet one who doesn’t have most of these expenses. And anyone who truly doesn’t have any overhead doesn’t have a business. They have a job and a delusional fantasy.

What is perhaps most interesting is the fact that for the typical small painting contractor, overhead comprises nearly 50% of the selling price. How then can a contractor overlook such a large part of his expenses and brazenly state “I ain’t got no overhead”?

I think the primary reason is financial ignorance—they simply don’t know what they don’t know. They don’t understand what overhead is. They don’t understand that overhead is an inescapable fact of owning a business.

The sad thing is, this ignorance is also a primary reason for the failure rate among painting contractors. After all, if you are not recovering half of your expenses, it is pretty hard to pay the bills, draw a reasonable salary, and make a profit. The money to pay overhead has to come from somewhere, and it is usually the owner’s pocket.

The truth is, if someone truly ain’t got no overhead, they ain’t got no business either.

© BEP Enterprises Incorporated 2008