Define a Residential Contracting Business Model

A. Finished-Project Specification

Quantity: one approved Business Model Statement, one service-area and project-fit matrix, one customer-fit and project-fit checklist, and one stop-work or decline-work list, each dated and signed by the owner and reviewed by at least one qualified professional.

B. Document Schedule (Component Schedule)

Document	Quantity	Format	Content Required	Preparation / Purpose
Business Model Statement	1	Written statement, one to three pages	Service, customer, geography, project range, delivery method, advantage, and limits	The single controlling document referenced by every later chapter
Service-Area and Project-Fit Matrix	1	One-page table	Each candidate service against jurisdiction, licensing status, and project-size limit	Screening tool used before a service is advertised or bid
Customer-Fit and Project-Fit Checklist	1	Checklist	Criteria distinguishing an in-model lead from an out-of-model lead	Used in Chapter 11 intake screening
Stop-Work / Decline-Work List	1	List with reasons	Named services, conditions, or customer types the business will not accept	Prevents uncontrolled scope and unauthorized-work exposure

C. Information Takeoff

• Owner information: trade experience, management experience, current licenses and certifications, owned equipment, available capital, current workforce, supplier relationships, and existing customer base, gathered before Step 1.
• Jurisdictional information: the complete list of states, counties, cities, and districts under consideration, gathered before Step 2.
• Professional input: at least one qualified reviewer identified before Section H, and additional reviewers (attorney, CPA, broker, licensing advisor) as the specific question requires.
• Financial reference: the Book 24 cost structure, used for the startup and working-capital estimate in Section E; do not substitute an unreviewed personal estimate.

D. Acceptance Standards

Check	Standard
Service definition	Every listed service is checked against current licensing, insurance, training, supervision, equipment, and permit capacity; every removed service is documented with a reason
Customer and geography	Target customer and service area are each defined in terms specific enough to screen an actual lead against them
Project-size range and capacity	Minimum and maximum project size and the maximum number of active jobs are each stated as a specific value, not a general description
Competitive advantage	Each claimed advantage is supported by specific evidence the business can produce on request; unprovable claims are removed
Financial assumptions	Startup capital, revenue, and capacity figures are built from the Book 24 cost structure and are labeled as planning assumptions, not guarantees
Professional review	At least one qualified reviewer has reviewed the completed draft and their comments are recorded and addressed before approval
Approval	The Business Model Statement and its three supporting documents are signed, dated, and stored in the company record system

E. Owner and Jurisdiction Profile

1. Describe the owner's trade experience, management experience, licenses, certifications, equipment, capital, workforce, supplier relationships, and existing customer base. Record each item on the Business Model Statement template's profile section before continuing.
2. Identify the jurisdiction in which the business will be formed and each jurisdiction in which it may offer or perform work. List every candidate state, county, city, or district by name on the service-area and project-fit matrix.

F. Service Selection and Screening

1. List the residential service categories under consideration. Record each candidate service — repair, maintenance, remodeling, carpentry, painting, flooring, exterior work, or a regulated specialty trade — as its own row on the service-area and project-fit matrix.
2. Verify that each proposed service can be performed within the anticipated licensing, insurance, training, supervision, equipment, and permit structure. Mark each row as supported, conditionally supported, or unsupported based on current information; do not mark a service supported without a specific basis.
3. Remove services that exceed current authority, competence, capital, staffing, safety capacity, or risk tolerance. Move each removed service to the stop-work / decline-work list with the specific disqualifying reason and the condition that would allow reconsideration.
4. Define the primary service category in terms a customer can understand. Write one sentence naming the single service category the business will be known for.
5. Define secondary services that support the primary category without creating uncontrolled scope expansion. For each secondary service, state the specific limit that keeps it in a supporting role.
6. Define explicit excluded services, prohibited work, emergency-work limitations, and referral categories. Record each on the stop-work / decline-work list together with the referral category or contact to be used.

G. Customer, Geography, and Capacity Definition

1. Define the target customer by property type, ownership, project need, decision process, and service expectations. Write the definition on the Business Model Statement in terms specific enough to accept or decline an actual lead.
2. Separate homeowners, landlords, property managers, investors, associations, builders, and commercial customers when their requirements differ. State which categories are in scope and which are excluded.
3. Define the intended geographic service area using travel time, jurisdictions, permit systems, supplier access, labor availability, and vehicle cost. Name the specific boundary — a travel-time radius, county list, or municipal list.
4. Identify areas excluded because of distance, licensing, tolls, parking, congestion, weather, or operational burden. List each excluded area on the service-area matrix with the specific reason.
5. Define the minimum and maximum project size by contract value, duration, labor hours, crew size, complexity, and risk. State each limit as a specific figure or range, not a general description.
6. Define the maximum number of active jobs the business can manage without damaging quality, safety, cash flow, or communication. State the specific number and the basis for it.
7. Define whether work is self-performed, subcontracted, managed, or delivered through a combination. State the delivery method for the primary service and each secondary service.
8. Define the expected ratio of repair calls, small projects, larger projects, recurring maintenance, and warranty work. Record the target ratio as a planning assumption to be tested against Chapter 18 job-cost results.

H. Advantage, Capital, Risk, and Documentation

1. Identify the customer problem the business is designed to solve. Write one specific statement connecting the primary service to a customer need.
2. Identify measurable advantages such as responsiveness, documented quality, specialized skill, occupied-home controls, predictable scheduling, or maintenance continuity. For each advantage, state the specific evidence the business can produce to support it.
3. Reject competitive claims that cannot be proven or delivered consistently. Remove any advantage statement lacking specific supporting evidence before the model is finalized.
4. Identify required tools, vehicles, office systems, software, storage, shop, and field infrastructure. List each item and its current status — owned, needed, or under evaluation.
5. Identify required employees, supervisors, subcontractors, bookkeepers, advisors, and professional partners. List each role and whether it is currently filled.
6. Estimate startup and working-capital needs using the Book 24 cost structure and qualified financial guidance. Record the estimate and the reviewing financial professional's name and date of review.
7. Define target revenue, gross profit, overhead recovery, owner compensation, cash reserve, and capacity assumptions without representing them as guaranteed results. Label this section "Planning Assumptions — Not Guaranteed" on the statement.
8. Identify major risks including licensing, injury, property damage, warranty, weather, customer concentration, labor shortage, supplier dependence, and cash flow. List each risk with a one-sentence description of its potential effect on the business.
9. Define the business's risk acceptance, referral, insurance, contract, and contingency strategy. For each risk identified in the previous step, state the planned response: accept, insure, contract-limit, refer, or avoid.
10. Identify legal, tax, insurance, accounting, employment, and licensing questions requiring professional review. List each open question and the professional responsible for answering it.
11. Create a one-page service-area and project-fit matrix. Finalize the matrix begun in Section F and G with every candidate service, jurisdiction, and project-size limit in one table.
12. Create a customer-fit and project-fit checklist. Convert the customer and project-size definitions from Section G into a yes/no screening checklist usable during Chapter 11 intake.
13. Create a stop-work or decline-work list. Finalize the list begun in Section F with every excluded service, area, and customer category and its reason.
14. Write the business model statement covering service, customer, geography, project range, delivery, advantage, and limits. Assemble the completed sections into the final one-to-three-page statement.
15. Review the statement with the owner, attorney, CPA, broker, licensing advisor, or experienced contractor as applicable. Obtain and record specific comments from at least one qualified reviewer.
16. Revise assumptions and record unresolved dependencies. Update the statement to address reviewer comments and list any item still pending professional confirmation.
17. Approve the business model as the controlling basis for licensing, insurance, pricing, marketing, and operations. Sign and date the final statement and store it in the company record system.
18. Assign a review date and conditions that require the model to be updated. Record the next scheduled review date and the specific events — new jurisdiction, new service, licensing change, capital change — that would trigger an earlier review.