Hiring a general manager so you can step back

Why owners hire a GM, and why many hires fail

Owners usually start thinking about a general manager when the business has outgrown them: they are running sales, dispatch, hiring and finance at once, and growth has stalled because every decision waits for them. Others want to step back for family, health or a future sale. In both cases, a business that runs only through its owner is fragile.

Long-term survival is not automatic for any small business. BLS tracking of private establishments that opened in March 2015 shows 79.6% still operating after one year^[2], 50.2% after five years^[3] and 34.6% after ten years^[4]. A management layer is no guarantee, but depending on one person for every decision adds risk most owners can reduce.

GM hires fail for predictable reasons: the owner never really lets go, the role is vague, the financials are unreliable so nobody can judge results, or the person hired is a great technician or salesperson but not a manager. Each of these is avoidable with preparation.

Are you ready? A readiness test

Answer these honestly before posting a job:

• Do you have monthly financial statements, closed within two to three weeks of month-end, that you trust?
• Can the business afford a senior salary plus bonus for a year while the GM ramps up, without starving cash?
• Are core processes written down: how calls are booked, how jobs are priced, how techs are hired and trained, how memberships are sold?
• Do you know which five to eight numbers tell you whether the business is healthy?
• Are you willing to let someone else make decisions you would make differently?
• Do you know what you will do with your time once the GM is in place?

Most home service companies are small when owners first face this question: 58.3% of plumbing and HVAC contractor establishments had fewer than five employees in 2023^[5]. A GM is usually a later step, after the business has a management layer to lead.

If you answered no to more than two, start with those gaps. An office manager or operations manager can help you build them; our guide on when to hire an office manager covers that earlier step.

GM, operations manager or integrator?

Titles mean different things in different companies. Decide which role you actually need:

Write a scorecard before the job ad

A scorecard defines the outcomes the GM is accountable for, so you can hire against it and judge performance later. Keep it to one page:

1. Mission: one sentence, such as "Grow profitable revenue while keeping customers and techs loyal".
2. Outcomes for year one, each measurable: net profit margin, revenue, gross margin by department, technician retention, customer review rating, safety incidents.
3. Competencies: hiring and coaching managers, reading financials, making decisions with incomplete information, calm under pressure, honest communication.
4. Decision rights: what the GM decides alone, what needs a conversation and what stays with the owner (for example, sale of the business, new locations, major borrowing).

Share the scorecard with finalists. Strong candidates want to know how they will be judged; weak ones avoid the question.

Finding and testing candidates

Look in three places: experienced managers at larger home service companies who want more ownership, leaders from adjacent industries such as facilities management or distribution, and your own team. Industry experience shortens the learning curve, but management ability matters more than knowing how to braze a line set.

1. 01

   Screen on results

   Ask for specific numbers they moved in past roles and how.

2. 02

   Run a case

   Give finalists your last six months of anonymized financials and ask what they would focus on first.

3. 03

   Meet the team

   Have them spend half a day with your service manager and lead techs. Ask your team for honest feedback.

4. 04

   Check references deeply

   Speak with people who reported to them, not just their former bosses.

5. 05

   Agree the first 90 days

   Before the offer, agree on what the handover looks like and how decisions will change.

How to pay a GM

BLS reports a median annual wage of $105,770 for general and operations managers across all industries in May 2025, from a base of about 3.6 million jobs^[1]. Your number depends on the size of the business, your market and the candidate. Total cost is higher than salary: US private employers paid an average of $46.89 an hour in total compensation in June 2026^[6], so budget for benefits on top of pay.

Structure matters as much as the total:

• Base salary competitive enough that the GM is not desperate for the bonus.
• An annual bonus tied mostly to net profit and partly to scorecard measures such as retention and reviews, paid after year-end financials are final.
• Avoid bonuses on revenue alone, which reward discounting and growth at any cost.
• Consider a long-term incentive, such as a phantom equity or profit pool, only after the first year proves the fit. Get advice from your accountant and lawyer.
• Put the plan in writing, including what happens if the business is sold.

A 90-day handover

The handover is where most owners stumble. Plan it as carefully as the hire:

The single most important behavior for the owner: when a tech or manager comes to you with something the GM owns, send them to the GM, every time. The first few weeks set the pattern.

Warning signs in the first six months

Even a good hire can drift. Watch for these signals and talk about them early rather than at the annual review:

• Leads and techs still bring decisions to you, and the GM lets them.
• The GM avoids the financials or cannot explain last month's results.
• Key people leave and the exit interviews mention the new manager.
• Every problem is described as inherited, and nothing on the scorecard moves.
• You find yourself reversing the GM's decisions in front of the team.

The last one is on the owner. If you disagree with a decision, raise it privately at your weekly meeting. Overruling a GM in public tells the team the old structure is still in charge.

Keeping a good GM

Once the hire works, protect it. Hold a weekly one-on-one focused on the scorecard, not on daily details. Pay the bonus on time and exactly as written. Give the GM room to build their own team, including replacing managers who do not perform. And talk openly about the future: a GM who knows where the business is heading, whether toward growth, a second location or a sale, is far more likely to stay for the journey.

Your new job

Decide what you will do once the GM is running the business. Some owners focus on big customer relationships, acquisitions or new lines of service. Others step back almost completely and meet the GM monthly. Both work, but drifting back into daily decisions does not. Put your new role on paper and share it with the GM.

Hiring is competitive. US construction job openings were 289,000 in September 2026^[7], and strong managers have choices. A clear scorecard, fair pay and a real handover are what attract them.

Example: an electrical contractor steps back

Example. A fictional electrical contractor with 18 employees and a busy owner hires a GM from a larger regional company. Before the hire, the owner spends three months with his accountant getting monthly financials closed by the 15th and writes down the five core processes. The GM's scorecard targets net margin, tech retention and review rating. The owner keeps decisions on borrowing and new locations. In month two the GM takes over the weekly meeting; by month four the owner works two days a week on commercial relationships and the rest of the time is genuinely off.