The Billionaire Plumber

We’re not really getting at the heart of the matter here.

Nobody’s talked about plumber prestige rankings…what constitutes a top 2 plumbing education? What’s the preferred hacksaw for the job? Can you transition from hardware sales to plumbing by networking correctly? Which calculator should be used to bill clients…the BA2 plus or the HP12C? Is it considered insider plumbing if you got the job from a friend?

…then we should consider who’s got more liquid assets. Plumbers or CFA/MBAs.

no cheating!!

Here’s a question, what would a plumber consider to be hacksaw worthy?

The guy who manufacturers the plunger or the sht scoop machine?

WTF is this? One benefit of being a plumber is you actually get to use a hacksaw everyday.

I think the plumber discussion conflates two separate things: plumber the plumber and plumber the small business owner. While plumbing is a useful way to get a trade with barriers to entry, plumbing isn’t really the reason the reward ceiling is higher for the small business. If Greenie wanted to start his own small business, the CPA gives him a similar moat and similar potential payoffs. It is often useful to take a trade with barriers to entry and make it a business :doctors, plumbers, CPA, PM, they all do it. So the real difference to me is that based on your trade, the quality of the competition differs. So being a plumber is a big fish small pond. Makes sense to me, but anecdotal evidence is tough to swallow. The opposite side is the more competitive fields tend to pay more sooner, giving you potentially more capital to launch a business faster. Do I really need to be a plumber to own a plumbing business? I don’t think so, just like I don’t have to be a car mechanic to invest in my buddy’s shop. I’m sure all of BlackSwans family and friends are millionaire plumber types, but until we know how frequently that occurs it’s not very useful. The income data by undergrad major I’ve seen always puts biology and economics at the top. Both of those fields can start their own business.

we’re also ignoring the fact that it would be hard, dirty, tiring work. you’d be running around all day trying to get through jobs, probably always behind schedule and taking calls at all hours trying to fend off people with snags etc that wouldn’t make you any money.

You’d also have your customers standing over you as you work and pressure to get everything perfect.

Then comes the issue with chasing up payment, I bet all self employed tradesmen get regularly screwed by people that won’t pay them

To Gringo’s point:

  1. Most demand cash, the median salary still is what it is

  2. No college debt

  3. Having a customer stand over isn’t that different from typical office types that work huddled in a dead cubicle with a boss floating around

To Raw Raw’s point

  1. Plumber actually pays more faster than competitive fields because you don’t have to do undergrad + no college debt which you keep ignoring.

  2. You may not have to work in the field to run a company in that field but I’d imagine your effectiveness is greatly diminished, similar to being an econ grad running a law firm. You simply wouldn’t have the level of understanding of complex jobs and the industry required to run the firm and investing hands off just leaves you open to innefficiencies while also losing any benefit you could have provided the firm. Lastly, most plumbing firms are small and run on a skeletal crew so it would be expected that you’re still doing some work to compete efficiently.

  3. The big fish in a small pond is primarily where the advantage we’re laying out lies.

I have to replace a lead pipe which runs from the house to the main line off the street. I got an estimate of 5.5k for 1 day’s labor. The plumber needs to outsource an excavation guy to dig the hole and move around a few small trees/plants (probably 1.5k) and he need to get a few permits from the town ($500 max). His labor will probably be less than 3 hours – 3.5k for 2-3 hours work not bad.

if you’re a master in any industry or job you can make a killing.

the point with the plumber (or skilled tradesman) is that they can theoretically get to this point a lot faster and with less up front education costs.

you know what they say…

Image result for shia labeouf just do it song

To Rawraw’s point the real question here isn’t the salary of a plumber it’s the salary of small business owner plumber (which is swiming in survivership bias). Being a skilled plumber allows for an easy entry into a small business unlike a lot of finance type jobs where opening your own shop maybe more difficult. If you work a hedge fund it’s very difficult to either start you’re own shop or a consulting firm supporting those types of business. Whereas in plumbing you just need somewhat of a track record and van.

This applies to many trades including law, taxes, etc. I have an attorney that does house closings for 1.5k - 2.5k a pop, owns the business with his father and farms out all of the real work to paralegals. The dude probably makes more or the same as the Harvard partners at top NYC law firms.

This is a great post. I think this sums it up.

A question i have is, can you own a plumbing company without being a plumber or do you think it makes you too out of touch with the industry?

  1. the point is: when cash is handed over? No customer pays up front for a big job, they’ll pay a deposit and the sensible ones will withhold payment until everything is finished and all snags are ironed out. That exposes the plumber to risk and people could just decide not to pay and they’re left with the cost of parts, their apprentice, and sub contractors they’ve used and little power to chase down payment rather than suing people.

  2. Can’t comment as I had none either

  3. I think there’s a difference between a boss and a customer standing over you though. A boss is on your side and are ultimately just doing their job as well, they need you on side. I can’t think of anything worse than having to work with the general public, most people are nice but there are a whole load of twats out there and people with unreasonable expectations.

So I ran a landscaping operation for three years. We did large transformative jobs rather than maintenance, weeding etc. So you’d call us in if you wanted beds reshaped, some trees taken out, walls or drainage put in, some planting done and of course mulch. Eighty percent of our jobs were between $1,500 and $7,000. In three years I never had a late or delayed payment. People would often come out and stand around and watch us work and it is a bit annoying because sometimes because you don’t like discussing details of the job with people openly when they’re around, you definitely save the high risk items like tree drops for when they’re not there and it just generally messes with the “flow” of things.

That being said, I liked our customers, they were generally pretty cool and most of them were just hanging out out of curiosity or understandable desire to see things done correctly. But I will say uniquivacably despite it being hard, dirty work (~80 hours a week all in), it was by a mile the best job I ever had. If all jobs paid the same I’d be doing that. The difficulty with landscaping is partly the seasonality of it (North East), low margins because you have to compete witih DIY, low barriers and maintaining quality control with scale. But it does answer some of your points.

You could alternately view your lack of college debt on graduation as money you could have used to launch a plumbing company (unless it was a scholarship / grant).

im opening a plumber head hunting service. in yo face

plumber broskis are not pullin in HCB wearing overalls and talking about the deals they are making.

So…average college debt is $30k, average loan repayment is ten years, my interest rate from DOE is 6.8%…that is a $350/month payment, right?

So you’re saying you can start with zero capital, pay $350 per month for ten years, and launch a successful plumbing company?

The bigger plumbing companies now have a machine that pushes the pipe underground. They only need to dig a hole at each end. I think they charge about the same (I assume the machine is expensive and they need to get a return on the investement), but you don’t have to deal with your yard being ripped up as much.

^Greenman- off topic a bit but why do you have so much debt? Didn’t you qualify for the GI Bill?

I think that sounds about right (realizing you start small).