Boss: DN
Guy: James

Rewritten Updates as of 24 Jan 2024

Introduction

On the 24th of January 2024, my journey took me to The Tropica at Tampines. However, navigating there was a challenge due to JH’s repeated wrong turns, leading us from Tampines to Ang Mo Kio.

Encounter at the Site

At the site, it appeared that Abu was handling the marble polishing job. DN was present, but James was not. I engaged in a conversation with DN to gain a deeper understanding of the business’s financial dynamics.

Financial Breakdown

DN shared the financial details of the current project, including a comprehensive view of her expenses since October. The numbers seemed logical, but certain aspects raised concerns:

Contrary to DN’s claims, it seems that marble and parquet jobs, though deemed high earners, actually yield lower profits due to higher costs.

Observations on Financial Management

A significant red flag was DN’s management of multiple companies and numerous phone numbers unassociated with the business. Her method of calculating earnings based on her personal bank account balance at month’s end is unconventional and likely overestimates actual profits.

Personal Business Challenges

DN shared the troubling dynamics of her business partnership. The constant conflict and verbal abuse, often belittling her capabilities, paints a picture of a strained professional relationship. Such challenges resonate deeply with anyone familiar with the intricacies of business partnerships.

Background of the Male Business Partner

DN’s male business partner, a former financial advisor, has a tumultuous personal and professional history, including infidelity and legal troubles. His tendency to exploit vulnerabilities and his involvement in various companies reveal a complex and possibly detrimental influence on the business.

Conclusion

This visit underscored the intricate balance between personal relationships and business management in small enterprises. The complexities faced by DN and her partner highlight the challenges that often go unseen in the world of entrepreneurship.

Updates as of 23 Jan 2024.

Outline for Rewriting Updates

1. Introduction

   • Brief context of the visit to 33 Cairnhill Residences.
   • Encounter with Min, the Bangladeshi worker.

2. Min’s Background and Work Experience

   • Early years in Singapore and initial salary.
   • First employment details and marriage.
   • Current employment and salary.

3. Working Conditions and Future Plans

   • Description of work hours and overtime pay.
   • Transport arrangements and costs.
   • Min’s plans to return to Bangladesh and ambitions.

4. Trust and Reliability

   • Min’s reputation as a reliable worker.
   • Relationship with ML and Bangladeshi boss, Abu.

5. Accommodation and Financial Aspects

   • Details of current and past accommodations.
   • Information about levy, insurance, and living expenses.

6. Bangladeshi Boss’s Background

   • Description of the boss’s family, financial status, and assets.

7. Min’s Personal Life and Aspirations

   • Details about Min’s family and lifestyle in Bangladesh.

8. ML Boss’s Background and Business Ventures

   • ML boss’s origins, career progress, and current business operations.

9. Details of Construction Work and Costs

   • Specifics of parquet and marble jobs, including costs and worker payments.

10. James’s Background and Current Situation

• James’s history in the army and current family situation.
• Details about James’s work and recent experiences.

11. Conclusion

• Reflection on the day’s experiences and interactions.

Introduction

Visited 33 Cairnhill Residences today, where I encountered Min, a diligent Bangladeshi worker.

Min’s Background and Work Experience

Originally from Bangladesh, Min arrived in Singapore at 18 and is now 27. He spent his initial five years working for his first company, then returned home to marry. He started with a salary of SGD 600 per month (or SGD 18 per day with SGD 3 overtime pay). Mentioned that this was the newbie pay, where they do not know how to do anything. the brain is not functioning and they are just an extra helping hand. he even joked that he had a few newbies following him before, and at $10 / day the company is also losing money. Upon his wedding, his boss generously gifted him SGD 2000 as a token of appreciation.

Working Conditions and Future Plans

Min’s current daily wage is SGD 50 (8 am to 5 pm), with overtime pay at SGD 7 per hour. If work extends until 10 pm, he receives an additional SGD 5 for dinner. Lorry transport costs are SGD 40 for a one-way trip, doubling for round trips. He plans to return to Bangladesh for 4-6 months, aspiring to complete his driving license during this period. Min envisions the ideal work team as comprising a lorry driver and 2-3 workers tackling various jobs. A monthly lorry rental is at $2000.

• Min’s Skills and Job Specifics
  • Min possesses a diverse skill set, enabling him to undertake a variety of tasks. These include:
    • Waterproofing
    • Polyurethane (PU) injection
    • Hacking
    • Painting
    • Timber painting, marble polishing, and all parquet work
    • He also holds an Electrical certificate (CoreTrade), enhancing his job opportunities.
  • Efficiency in Work: Min can complete a full HDB toilet hacking, including debris cleaning, in just one day. For this, he is paid SGD 80, while the company charges around SGD 600.
  • Standard Daily Rate: For most other day jobs, Min’s rate stands at SGD 60 per day.

Trust and Reliability

Recognized for his steadfastness, Min maintained a clean record during his five-year tenure at his previous company. His work permit and MOM pass reflect his reliability, with no instances of crime or injury. His current employment under ML and collaboration with his Bangladeshi boss, Abu, is a testament to the trust they place in him.

Accommodation and Financial Aspects

Min currently resides in a MOM-approved hotel in Geylang, with a monthly rent of SGD 650. His previous residence was at Geylang 33. The worker levy he pays is SGD 600, but the actual amount handed over to the boss is approximately SGD 1000. All insurance needs are covered by his contracting company, ML.

Bangladeshi Boss’s Background

The Bangladeshi boss, Abu, owns a 100 square feet warehouse, well-stocked with various tools and equipment. He is financially secure, with enough savings to retire comfortably in Bangladesh. His family includes a highly educated, yet unemployed son, and two daughters, one of whom is married.

Min’s Personal Life and Aspirations

Back in Bangladesh, Min has a sizable landholding. He and his wife prefer a modest lifestyle, content with their simple, single-story home. His desire for a straightforward, unpretentious life is mirrored in his lack of interest in accruing more land or building a lavish house. He aims to work until his children have grown up and are independent to make money.

ML Boss’s Background and Business Ventures

The ML boss, originating from Malaysia and now around 50 years old, began his career in tiling work before transitioning to property rentals. Over two years, he has impressively rented, renovated, and leased out 75 properties, with an additional 40 in partnership. The rental prices for these properties are as follows: master bedrooms at SGD 1850, standard rooms at SGD 1600, and smaller renovated rooms around SGD 1200.

Details of Construction Work and Costs

• Parquet Job

  • Costs for different room sizes:
    • Three rooms: SGD 600
    • Two rooms: SGD 500
    • One room: SGD 300
  • Material Costs:
    • Varnish (5L): SGD 35
    • Lacquer: SGD 30
    • Thinner: SGD 30
  • Transportation: SGD 80 for a round trip
  • Worker Compensation:
    • Regular worker: SGD 60/day
    • Freelancer: SGD 150/day
  • for example a $600 job, $95 in raw cost. with a delivery, that would equate to $175. assuming that the material cost are stated. my brief search on varnish is more expensive, but in my mind, thinner is much cheaper.
  • if you have cheaper materials or own transport would lower your cost.
  • labour if you hire and maintain them, it will be cheaper overtime. otherwise it would be $150 / worker.
  • so if you are starting, your cost would be 80%. margins are only 20%.
  • if you are established, you can get your cost margins down to 45%.

• Marble Job

  • Pricing: SGD 1 - SGD 1.2 per square foot.

James’s Background and Current Situation

James, a former intelligence unit member in the army, served as a regular for seven years. He has a 20-year-old son currently undergoing training at Pasir Lebar Camp. James volunteered to extend his service until the age of 50 and has been awarded for 15 years of service. He holds the rank of 3rd Warrant Officer and was part of SISPAC.

During a recent task involving toilet marble stain removal, the cost for the acidic paste used was quoted between SGD 100-200. The job was initially priced at SGD 1,000 but was negotiated down to SGD 600 by the property owner. Both James and his colleague appeared exhausted running this business. On asked about other potential buyers, they mentioned that they just came after meeting with potential buyers, a team of 3 - restaurant chain owner and two interior designers.

Edits:

• 23 Jan 2024

  • sent a quick text to ask for site visits, to potentially meet with their valuation
  • was allowed to visit 2 sites.
  • immediately went down to one of them.

• 19 Jan 2024 9.30pm

  • rejected our offer of 60k.
  • ahh fk them. lets do it ourselves.

• 19 Jan 2024 5pm

  • made offer 60k.

Business Model Overview

A*** Team’s Business Model Summary**

1. Business Overview:

   • Name: A***** Team
   • Industry: Professional Cleaning Services
   • Services Offered: Deep cleaning, painting, upholstery, electrical handyman works, parquet flooring polishing & varnishing, marble flooring polishing, curtain cleaning, and handover/end of tenancy cleaning.

2. Business Strategy:

   • Primary Focus: High-margin services, particularly flooring polishing and curtain cleaning.
   • Client Acquisition: Leverages property agents, HIP flyer contacts, and online inquiries, with a strong focus on word-of-mouth referrals.
   • Digital Presence: Invests in SEO and maintains an effective website for client engagement.

3. Financials:

   • Revenue: Approximately $30k - $40k per month.
   • Profitability: Labor is the main cost factor, with rates varying according to skill level.
   • Valuation: Initially listed for sale at $80k, factoring in SEO investments, website costs, and equipment.

4. Operational Model:

   • Staffing: Employs freelancers and part-time workers predominantly.
   • Management: Business relies heavily on partner James for administrative tasks, while owner Du Na is more involved in hands-on operations.
   • Equipment: Owns necessary assets for cleaning and maintenance services.

5. Market Position:

   • Competitive Edge: Renowned for a diverse range of high-quality services.
   • Clientele: Has a regular customer base across real estate and commercial sectors.

6. Challenges and Opportunities:

   • Challenges: Faces manpower limitations, lacks detailed financial records, and relies on cash transactions.
   • Opportunities: Sees potential for growth in untapped markets and the chance to streamline operations with technology.

7. Sale Considerations:

   • Reason for Sale: Personal reasons, including the physical and time demands of the business.
   • Support and Transition: The current owners are committed to providing support and training for a seamless transition.

8. Future Potential:

   • Growth Strategies: Aims to expand digital marketing, explore new markets, and optimize operational efficiency.
   • Scalability: The business model supports scalability with additional staffing and service expansion.

In 2023, the take-home earnings were reported at $300k.

The summary highlights A***** Team’s business model, focusing on its operational strategies, financial stability, and market positioning, along with potential for growth and the challenges faced.

The most profitable services include:

1. Parquet Flooring Polishing & Varnishing
2. Marble Flooring Polishing
3. Curtain Cleaning
4. Handover/End of Tenancy Cleaning

Background and Inception of the Business

• Inquiry: Can you share your background and what inspired you to start this business?
  • Response: The boss was a chef. During COVID-19, both of his restaurants closed down. Facing debt and a divorce, he struggled to make ends meet. However, he learned about the lucrative opportunity in carpet cleaning and started as a contractor for Sendhelper. Despite the platform’s high commission fees, he expanded into painting and learned other trades on the job.

Experience and Involvement

• Inquiry: How long have you been operating this business?
  • Response: Since the onset of COVID-19.
• Inquiry: What roles have you and your partner assumed in the business?
  • Response: The partner handles administrative tasks, while the boss is more hands-on, ensuring tasks are completed on-site.

Decision to Sell

• Inquiry: What prompted the decision to sell the business now?
  • Response:
    • The demands of running the business have become overwhelming. It’s physically and time-consuming, leaving no room for family time, particularly with her child. Additionally, there have been frequent disagreements with her current boyfriend.
    • Financially, she has achieved a level of success, having purchased a house for her mother in China for $250k and acquiring a company van in March 2023 for about $30k.
• Inquiry: What are your aspirations or plans post-sale?
  • Response:
    • She plans to enroll at NAFA to study Interior Design and dedicate more time to her child.
    • James is considering pursuing a degree in cybersecurity.

Insights and Advice

• Inquiry: What insights or advice would you offer to the new owner?
  • Response:
    • For those with IT knowledge, consider developing an app similar to Sendhelper to streamline operations.
    • Concentrate on high-margin services such as parquet or marble polishing and curtain cleaning.
    • Aim for a pricing strategy of $1 per square foot.