By the Job: This tends to be one of the most economical ways to pay help workers when you need help on a foreclosure cleaning job. Why? Because it helps you to keep control of your costs. Under “Labor” you can put down, with certainty, a number; there are no surprises.
Another advantage of paying like this is that it tends to be fair to both parties. The worker knows how much they are going to get before a job begins. Most appreciate this and if you pay a fair wage, they will sign on with you again and again, making it easy to recruit help as you need it.
Foreclosure Cleaning “Day Wage” Tip: Building a Crew
A residual advantage of paying a set rate for each foreclosure clean up job is that you will tend to build up a go-to crew. As mentioned above, if your “day rate” is fair, you’ll have workers who will gladly take as much work as you can give them (if they’re available).
When jobs come in, you won’t have to go on a head hunt each time. You can just call your “regulars” and see if they’re available. And, even when they’re not, most of the time, they have friends, family and acquaintances that they will refer to you.
Bottom line: Build a reputation as a foreclosure clean up company that pays a fair day wage. It will pay dividends over and beyond what you will find on a balance sheet (eg, save recruiting time, worker loyalty, etc.).
By the Hour: This can get a bit tricky in that if you don’t know how to calculate how long it will take you to complete a foreclosure cleaning job, you can eat up a lot of your profit. This is especially true if you have a crew of more than a few workers.
Note: The following is first-hand advice. I used to own a staffing agency and recruited in the industrial sector for a couple of years, so this is first-hand knowledge.
Foreclosure Cleanup Hourly Wage Tip: Call a local staffing agency like Labor Ready (because they handle jobs like construction cleanup) and ask what they charge for day laborers. Just tell them that you own a foreclosure cleaning business and have a job coming up where you might need to hire workers. They’ll ask you to describe the duties the workers will be doing, and then they’ll quote you an hourly rate.
Most staffing agencies take anywhere from 40-60% of the hourly wage you pay them for profit. So, for example, if they quote you $20/hour, they’re probably paying the worker $8 to $12 per hour.
In this case, you have two options: You can do your own recruiting and use their figures as a benchmark for what to pay, or, you can use them to staff the job.
Just know that staffing agencies that specialize in day-labor-type positions (eg, construction cleanup) have very strict policies about what their workers can and cannot do. This is because of workers’ comp insurance. Staffing agencies pay a mint for this.
For example, most say that workers can’t be on ladders, which means no cleaning, lifting, etc. in high places.
Foreclosure cleaning is a multi-faceted business. Hence, deciding what to pay hired help is based on a lot of factors. No matter which method you use, always keep your bottom line (ie, how much you want/need to make) in mind.
Note: Foreclosure cleaning jobs and pricing (of which this topic falls under) will be discussed in more detail in the forthcoming ebook, Pricing Guide for Real Estate and Foreclosure Cleaning Businesses. (Release Date: 8/4/09).
P.S.: Learn how to start a foreclosure clean up business — and get on the road to creating financial security for you and your family.
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Copyright © 2009 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.