Grinding Out $1,000,000 Part I
This is a story that many of us can relate to in one way or the other. Gary grew up in Ferdinand, Illinois. His friend was a little ahead of him and finished a 2 year degree in air conditioning and got a job right away. So Gary did the same. Once he graduated, he took a trip with a different friend of his to Houston.
As they were driving around Houston, Gary saw an air conditioning company and decided to stop. He was hired on the spot. He got an apartment and has never left Houston.
Struggling-No Thoughts to grinding out $1,000,000
He worked for that company a few years, but had a serious car accident. After he recovered in 1986, at 26, he decided to start his own air conditioning business. His friends and family helped him get into business; he was able to get a truck for his business very cheaply. He said he really did not run it like a business; he had no real plan, and lived out of his check book. If there was money in the checkbook he used it. If there was no money, then he lived frugally and didn’t buy anything until he had another service call and got paid. From 1986 until 1994, he struggled. He admits it was his fault.
Gary Gets a Business Manager (A Wife-Joan)
When Gary got married at 34, his new wife made him put “big boy pants” on? He knew he needed some organization in his business and he knew he really needed to get a handle on his accounting and cash flow. Joan with his blessing took control of the administrative side of the business. One thing she did right away was to go after receivables, many that were never even followed up on. She also noticed a pattern that for Gary the commercial clients paid slowly and often not at all, but residential clients seemed to always pay right away. It wasn’t long before he stopped commercial and focused completely on residential. Things got better right away and the couple was able to start saving some money within a couple of years. Gary really was just doing jobs until he met Joan. After Joan joined the company it was the first year his a/c business was run like a business.
What Gary is doing Right
Gary provides great service and he has great reviews. He now consistently grosses $700,000-$850,000 a year which allows him to make about $150,000-$250,000 a year. Gary and his wife live a reasonable lifestyle and do not spend a lot of unnecessary money; still they are able to get about anything they want. They take vacations and have a good, fun life. He has two technicians, his brother and an employee, so he is able to do more work than if it was just him.
Gary is a Millionaire
Net worth $1,625,000-Gary told me that he has about $1, 200,000 in cash, annuities, and their IRA accounts. He also owns his own house and a work shop. Both are paid for and are worth $275,000 and $150,000 respectively. Giving no value to the business, Gary and Joan are worth about $1,625,000. He said he was not sure, but he might have been worth $1,000,000 about 6 years ago. If that is correct, it took him and Joan about 13 years to make their first $1,000,000 from when they started together.
They hired a financial advisor in about 1996 and invested their first $60,000. Of course they wanted it to grow. But their first financial advisor lost half their money. Not being deterred, they tried again and the new advisor did much better. They still have that same advisor today. The business is 29 years old from the first day Gary started doing a/c work on his own. And it has been 19 years since Joan got involved and it really started to be run as a business. Gary did not need a special million dollar idea, he earned his money with an everyday tried and true business.
Part II Next Week
What could Gary have done differently to make his $1,000,000 sooner? What is Gary doing now? How could Gary take his business to the next step? What are the lessons to help you to make your first million dollars? See part II.
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One Million in the Bank
How to Make $1,000,000 with Your Own Business, Even if You Have No Money or Experience
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