Mikelly Posted November 23, 2005 Share Posted November 23, 2005 So our company, BKA (http://www.bka2005.com) has been up and running for a little over one month. Seems we've spent more money initially than we've made, but that isn't a huge concern. What does it cost to provide top of the line benefits for a small company of TWO? Our benefits package currently is costing monthly: Healthcare - ME:$240.00 My Parnter: $287 LT/ST Dis - Me: $47 My Partner: $59 1Mill Life - ME: $148 My Partner: $184 Totals ME: $435 My Partner: $530 Our healthcare is through Trigon Bluecross/ Blue Shield and covers vision. Right now the dental plans offered were so bad, we are just offsetting the employee's lack of dental with additional salary. As you can see by the numbers above, We're spending just under $1000 per month on the basics for our coverages, which we will also include for our employees (Life Insurance coverage amount will be less). We're paying $2000 per month to a CPA for our books and keeping us legal for the first 6 months. That $2000 is getting us some other perks along the way, since they grow businesses for a living. It sounds high, but that team has simply stunned us with their abilities to do things with money. The tax laws for small businesses in government contracts are spookey to me, so I'll pay the money and stay in the IRS' good graces! We've also spent about $500 with an attorney through the CPA for the structure and registration of the corporation, and review of contract "stuff". For the gov't contract work we're consulting on, we're required to have a professional liability insurance policy and that 2mill. policy ran us about $500. We've spent a few bucks on building a data server, buying myself a higher end laptop, some office peripherals and supplies. Otherwise we're trucking along OK. The biggest test for our small defense contract company has been making contacts and getting the "In" to subcontract. We're actually going to bid as prime contractor on some work out at the NSWC in Dalhgren Va. We're also spending a lot of time (Actually I am, Barry is on contract working!) visiting other prime contractors and giving our sales pitch for our capabilities. considering our bill rates for my partner and I (He is on site now, and I'll be on contract in early January if all goes well...) We should be in the black within the first 6 months. If we get the chance to actually put others on contract, we'll grow rapidly, and things will take off from there. So far our actual costs to date have been less than $7K to structure the company and we've already got a bank to fund up to $250,000 to support payroll for future employee growth. One reason we've hooked up with and are paying our CPA firm the money we are is that they are plugged into small business growth in our area and were able to plug us into this particular bank for payroll funding. Unheard of in our field, actually! What this means is that when we hire someone and put them on contract, we have to pay that employee within a given period (Generally withing 4 weeks), but we won't get paid for their services for about 60 days. The prime contractor gets an invoice from us for the hours worked by the employee at the end of a billing period (Generally end of the month) and at a specific bill rate, and they process it. Generally speaking it takes about 30 days for the invoice to be processed from the time they receive it. So we'd need to cover the employees salary until we get paid. This bank will cover 80% of that gross number for us. for up to 60 days per employee. So if we do get awarded a larger contract, and we can find the cleared people to do the work, It'll be covered. We're structuring it so we can afford to pay for all our employee benefits, offset the costs of their family coverage as well, and provide all government holidays, as well as a minumum of four weeks leave (Sick and annual rolled into one) per year for employees with less than 10 years experience and five weeks leave for employees with 10 years plus experience. We're also going to set up an employer funded retirement account for employees as well as a 401K, once we meet that minimum requirement. So what does that sound like to you guys for a benefits package? Anything I've missed? We're hoping for very good things in 2006! Fun Fun FUN! Mike Quote Link to comment Share on other sites More sharing options...
b__sosick Posted November 23, 2005 Share Posted November 23, 2005 it'd only cost like 10 dollars for some geeky pimpled face 16 yr old to finish your website... a worthy investment ;] Quote Link to comment Share on other sites More sharing options...
Zhadman Posted November 23, 2005 Share Posted November 23, 2005 Makes me wish I had the skills to work for a defense contractor... all I have is a security clearance! Lol Those benefits sound pretty darn good. Benefits have largely been decreasing across the board as companies begin feeling the pinch. A healthy package is a great way to lure employees (especially those with families). Good luck Mike, sounds like you're off to a good start! Quote Link to comment Share on other sites More sharing options...
Mikelly Posted November 24, 2005 Author Share Posted November 24, 2005 B- We're working on the website. But right now we're busy with other "stuff" and it is on the back burner. We'll get it done! BUt based on the nature of our business (Intelligence Community Consulting), I'm not about to turn it over to some pimple faced teenager! There are millions of dollars in revenue at stake here... Mike Quote Link to comment Share on other sites More sharing options...
dladow Posted November 24, 2005 Share Posted November 24, 2005 Sounds like you are doing things carefully and with good professional advice. Running a small business is not easy, and many of them fail just for lack of experience in what to anticipate and plan for. The money you are spending for those experienced CPA's, who specialize in small businesses, is a wise investment. Thay have seen the inside of hundreds of businesses. They know where the "gotcha's" are and can help you avoid mistakes. Hooking you up with the financing source to bridge payroll is an excellent example of the kind of knowledge advantages they bring to you that may seem like a small thing, but those small things can mean the difference between success and failure, or between sleeping at night and lying awake thinking uh-oh. Glad you're having fun and hope that 2006 rocks! Dave Quote Link to comment Share on other sites More sharing options...
Workinprogress Posted November 25, 2005 Share Posted November 25, 2005 I'm surprized and pleased that you project being in the black so early. I'm sure you guys are the right people at the right time and place to get out of the red that quick. Good luck. (My parents started several small businesses, they were in the red for the first year in most cases, sometimes longer) However, they didnt sell to Uncle Sam. Once again, good luck Quote Link to comment Share on other sites More sharing options...
DrSideways Posted November 25, 2005 Share Posted November 25, 2005 It sounds like you are doing fine. It is taking you less in funds to start that than it would for me to bring a race prep shop into fruition. As far as keeping the CPA staff...... surround yourselves with the best folks and let them do their jobs. Of course proper and timely suppervision will keep them from going to the islands with the booty.. Happy Holidays, Alan Quote Link to comment Share on other sites More sharing options...
SBC_400 Posted November 25, 2005 Share Posted November 25, 2005 it'd only cost like 10 dollars for some geeky pimpled face 16 yr old to finish your website... a worthy investment ;] if you want your company to look like it is owned by a 16 year old who knows how to use a template. you definitly get what you pay for Quote Link to comment Share on other sites More sharing options...
randy 77zt Posted November 27, 2005 Share Posted November 27, 2005 mike-went to your website to learn about your company-not much there.when you get it done i will check back later.i am really burned out on working as an auto mechanic so i am trying to get some ideas about a career change.good luck. Quote Link to comment Share on other sites More sharing options...
Here comes trouble Posted November 29, 2005 Share Posted November 29, 2005 Looks like you are off to a good start and operating on courage to do this. Insurance is fairly important. Could you not extend your health coverage thru your former employer with a COBRA plan and reduce health costs or catch a ride on the spouse's health coverage?....It may require 24/7@365 for the first couple years with sack lunches. It is the little things that will nickle and dime you to death ! ....Good Luck to you take care. (and always cross those t's and dot those i's with the guv'nmint) Quote Link to comment Share on other sites More sharing options...
crazy280 Posted November 29, 2005 Share Posted November 29, 2005 if you want your company to look like it is owned by a 16 year old who knows how to use a template. you definitly get what you pay for Right, so you go pay a bunch of money to hire a "professional" who is, in fact, a pimply faced teenager..........with a degree lol Quote Link to comment Share on other sites More sharing options...
Mikelly Posted November 29, 2005 Author Share Posted November 29, 2005 'Trouble, We checked into COBRA and it was going to be as expensive to duplicate our coverage through the previous employer for ONE of us, as opposed to covering costs for both of us on our own policies. I was technically still covered under my former bosses insurance until the end of November, but It was going to be about $1000 for my partner alone on COBRA, so I opted to go on a "group" policy with my partner to A: Offset the cost and B: establish our benefits so when we start hiring employees, we'll be able to tell them we are providing ########! Crazy280, If I hire that Pimplyfaced kid through a company, I have recourse to get refund or get the work redone... If the pimplyfaced kid is going solo and to interested in the new Xbox360 he just bought with my deposit, and isn't responsive to my customer request, then I have little recourse, other than finding him and "getting" his attention... I'll go with a company and pay the price... It's yet one more write-off. Mike Quote Link to comment Share on other sites More sharing options...
crazy280 Posted November 30, 2005 Share Posted November 30, 2005 I know, I was just kidding Quote Link to comment Share on other sites More sharing options...
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