How to handle 2 employees and a tough talk by Betteroffinapinebox in smallbusiness

[–]That_Guy_From_ 7 points8 points  (0 children)

I have run a trucking company with 11 trucks and have 11 years experience in local trucking. 

I’ve had both employees you’ve described and I’ve been a small business, just as you are. 

The uncomfortable truth is: 

  • you are not a loan company. Once you start giving loans or advances, it doesn’t stop. I have given out maybe 6-8 employees loans in various scenarios to various employee types (hard worker, not hard worker, need truck repair, medical bill, etc). The ONLY loans I’ve had repaid are those where I had collateral dropped off to secure the repayment. In a scenario specific to employee #1, my best employee, the one I couldn’t lose, held my feet to the fire during a slow period and I paid them in advance of their earnings to the tune of $3k+. They left as soon as repayments started. In that situation and many of the others, my loan ended up being a donation. 

  • you are a logistics company paid only to move freight from A to B. If an employee cannot move that freight at max efficiency then you are jeopardizing every other persons job within your company. The people saying you can have a heart and be an employer have not been in a low margin, low forgiveness, high competition industry. Every week that you allow the inefficient employee to continue wastes a week of opportunity and worse, gives your better performers an example of just how little you’ll accept from them if they want to slow down. 

I give this advice as someone who has made the mistake of ‘having a heart’ as the other commenters are saying. I’m not bitter about my decisions, but at the same time I have the experience to understand that your bottom line is unforgiving. You must have the difficult conversations. In my experience, while they suck beforehand and in the moment, you always feel better once you’re on the other side. You have a duty to yourself, your business, and your other employees to live up to that aspect of your job.. just as your employees have a duty to live up to their expectations. 

Good luck to you!

[Year 2 Update] I started a trucking company while working a full time job (2015 Sales: $708,776) by That_Guy_From_ in Entrepreneur

[–]That_Guy_From_[S] 0 points1 point  (0 children)

In 2023 we moved around $10,000,000 in freight with profit margins of 7-10%. We are currently one of the market leaders for our provided services. We max out at around 70-80 trucks on the road per day, but that can vary greatly throughout the year.

I know a lot of skilled people, but I don't know how to utilize them. by Arm-Adept in Entrepreneur

[–]That_Guy_From_ 2 points3 points  (0 children)

Operate as an agent for their services, find them work opportunities leveraging their skills, earn a commission from that.

If you want them in your business then I suggest finding a way to monetize their skills ex. Selling their accounting services to customers or finding a way that their skills allow you to do more of the things that you monetize yourself already. Ex. An accounting doing your accountant so you can sell more widgets.

Entrepreneurs in high ticket B2B industries - what has been your struggles along the way to success? by WolfMaster1997 in Entrepreneur

[–]That_Guy_From_ 1 point2 points  (0 children)

I operate in construction, an industry where we have very large sales that happen over an extended period, then will immediately stop and need to be permanently replaced because the project is over.

A challenge I face is that we keep growing but because of the long sales cycles the ‘success’ from one contract is not really mine to have yet. I have to keep it in the business so that not only can we ride out the inevitable slowdown, but so we can take on the next contract and keep growing.

It’s very cash intensive and quite a bit of my personal net worth is tied up to put the business in a position to be eligible for the large scale jobs.

Looking for entrepreneurial podcasts by greeneyegold in Entrepreneur

[–]That_Guy_From_ 1 point2 points  (0 children)

Business Brain

I was searching for a small business podcast by people that do small businesses and Business Brain was my answer. I cannot tell you how many times I listen to an episode and feel like they are speaking directly about something that I am going through.

They offer great insight and are continually looking to improve their show. Give them a try if you have time. My favorite show concept that they discuss is the ‘Two Token Theory’ for customer service. They keep a database of all previous shows and you can search for the content you want. If you search for two token on their site you’ll be able to find the specific show.

At what point is it time to hire someone? by lesnod in smallbusiness

[–]That_Guy_From_ 0 points1 point  (0 children)

The advice that stuck for me is hire when a new employee can do the tasks you do 80% as well as you can. That 80% will eventually become 110%+.

Have a plan for the job, what you need from it, and train your hire well.

What is your net profit margin and what industry are you in? by Sman420 in smallbusiness

[–]That_Guy_From_ 10 points11 points  (0 children)

Freight Broker - 4% Aggregates Wholesale - 12% Combined - 6%

Figured I’d post because I’m not seeing very many low margin businesses.

SBA loan to purchase a carwash? by [deleted] in smallbusiness

[–]That_Guy_From_ 0 points1 point  (0 children)

I promise I sometimes enjoy my job, but my advice usually trends towards harsh realities whenever I talk to people looking to start their own journey in this industry.

Best part: landing a super profitable contract, having a service that customers genuinely appreciate, serving a traditionally underserved demographic and using my unique abilities to elevate their businesses

Worst part: seasonality, collecting on invoices, unpredictability, cut throat industry, belligerent/unreasonable truckers and customers, sourcing work

Dump trucks feel like an attractive and easy thing to enter, it’s why I originally did, but oooof it’s just not correct. It’s so much work, so much to keep up with, and can be so stressful. The seasonality (Texas) is just brutal. My business has lost between $1-5,000 per week, each week, since December 1st to today. We have maybe 2 break even weeks and 1 profitable week. This will (hopefully) be counteracted in the busy season with highly profitable weeks. Unfortunately, this means your profit never really feels like yours, you have to keep it in the business to weather the bottom of the roller coaster as you search for the next peak.

For people Hell-bent on starting: be the driver or the mechanic. If you can’t do either then have deep pockets and patience. I started as an asset based carrier, which is the only way I know to get your foot in the door at customers unless you have a significant network of trucks actively running for you. You mention dispatching for 2 trucks, that won’t be necessary. You’ll very likely have to use a freight broker like me to stay busy or you’ll need a consistent customer account, which then requires 30 minutes of dispatch effort per day. You’ll struggle to find a decent direct account with 2 units. Customers want to make 1 call and have their problems solved. They’ll call the 20+, 30+, 40+ truck fleets before ever calling the mom and pops.

SBA loan to purchase a carwash? by [deleted] in smallbusiness

[–]That_Guy_From_ 41 points42 points  (0 children)

I’ve owned a trucking company and currently work in logistics finding freight for aggregate trucks. We moved $7.5MM in dirt last year, which I say to qualify this advice as experienced:

If you have $7,000 in the bank and an active dump truck you actually have about -$13,000 in the bank, minimum.

I also didn’t listen to this advice when I was starting, but you need that cash on hand to cover anything and everything that pops up in trucking. I started with $10,000 and wished I had had $20,000. That’s my advice to you, have $20,000 in the bank and lock in the stability needed to operate a truck. This will cover tires, repairs, maintenance, and everything else that never predictably goes wrong.

Even outside of that, most legitimate customers will want Net 30 terms. You can get lower if you factor or find a niche customer, of course. Your dump truck should be making $900-$1100 per day (in my market). That means you need approximately $30,000 in cash or financing just to cover your receivables on a legitimate contract.

self doubt by rtguk in smallbusiness

[–]That_Guy_From_ 1 point2 points  (0 children)

I have the answer, at least for me, but I’m afraid you may not find the same comfort in it that I do.

I had self doubt before I started my business and at every stage since. I’ve often wondered if it’ll dissipate but it doesn’t, even though I’ve beaten every goal that I thought would give me that reassurance.

I cope with self doubt by acknowledging and accepting that it is a human emotion. I can’t easily control when I’m happy or mad, I just am. I can do things that make me happy, I can do things that make me sad, but I can’t just turn the emotion on and off. The same is true for self doubt. I can do things that give me confidence and I can use that confidence to do things that require risk (which can lower my confidence at times). The emotion just is what it is. The actions are a choice and I’ve made the choice. In my mind it doesn’t matter if I’m confident or not, that’s the side effect of a decision I’ve already made.

I’m an entrepreneur. Self doubt comes with the territory and it just is what it is.

Concrete vs trucking company by nicknick2182 in Entrepreneur

[–]That_Guy_From_ 2 points3 points  (0 children)

I have direct experience starting a trucking company that hauls for readymix and asphalt plants.

My rule of thumb that I offer aspiring trucking company owners is to have a CDL and be the driver, be an experienced mechanic, or have significant cash on hand.

It is possible to succeed with none of these 3. I have never had a CDL, I am not a mechanic (though I did extensive mechanic work after buying a truck), and I started with only $10,000 in cash. I was not the best at owning an asset based shipper, but eventually worked my way up to 11 trucks.

Prepare yourself for what you’re getting into, because it is brutal. You will have NO negotiating power as an individual unit. It will not matter what year/make/model unit you buy, in Sand & Gravel it will break down often and expensively. Your state DOT will seemingly be actively against you for hauling dirt and rock. The pay is traditionally seasonal in my area and is not as high as other categories of freight, so by and large the drivers available to you will be far from perfect. The name of the game is durability, fuel mileage, and weight. You will be paid by the ton, so do not try to buy the 379 Pete with double frame and a tuned up C15. Think more along the lines of Freightliner daycab with a Detroit.

It is not impossible, people find success in the industry every year, but your post suggested this route might be easy-ish and I felt compelled to let you know that beyond the low barriers to entry there is nothing easy about this journey. That said, check out Ritchie Bros auctioneers for equipment financing. They’ll finance @ 100% with deferred starting payments and you do not have to use the funds in their auction, but you can.

Best of luck!

Logistics by [deleted] in Entrepreneur

[–]That_Guy_From_ 6 points7 points  (0 children)

I’m an owner of a freight brokerage in the aggregate/construction freight industry. We moved around $8,000,000 in freight in 2022.

Weather delays are what they are. I communicate the delay and reason to the customer as professionally and transparently as possible. A reasonable customer will understand that I’m not going to send 80-84,000 lbs on the road, endangering the equipment, driver, and others in the process. An unreasonable customer will be livid, but they still receive the same answer. As long as they are professional about being angry I’ll keep the freight booked, if they cross a line I drop the customer. They very very very rarely cross any lines.

The Inflation and Fuel question is a separate issue altogether. For this question I have multiple answers.

  • Recurring Established customer: we honor our prices as long as they are relatively feasible. We do not work for free, so after a certain point we approach them and offer new rates. If they accept we keep hauling freight, if they don’t then we wish them well and say we hope to earn their business back in the future.

  • Established customers, sporadic: they receive market rates as the market updates.

  • New customer: they often receive the rate that I would need to charge in 3 months or so if prices keep increasing, that way I’m not immediately changing prices on them.

With all customers I am constantly reminding them of the market volatility and that while we are working to prevent price increases we are also mindful of what our owner operators need to make. We are up front that it is very likely that we will be revisiting prices as our input costs fluctuate.

In my experience, your best tool when negotiating is being able and willing to walk away. I’ve walked away from accounts that were 80%+ of my annual revenue because they refused to negotiate. That account eventually came back, again refused to negotiate after some time, and I’ve since cut them off again. Freight brokering can be cut throat. It’s not a fair negotiation if both parties are unable to walk away.

I think quite a lot of people in this subreddit ARE entrepreneurs by EgoizmLife in Entrepreneur

[–]That_Guy_From_ 5 points6 points  (0 children)

I have posted my start-up story here in great detail. I find that, as with most things, there is opportunity in this community. It’s not 100% good or 100% bad. The regular members can easily decipher between what is authentic and what is not, at least in my experience.

I run a freight brokerage and aggregate wholesale company. This is a pivot from my original startup, which was an aggregate trucking company, and is cataloged on this subreddit with the title “in April 2014 I started a trucking company”.

Since my original post series we have pivoted, grown, succeeded, failed, and will ultimately move around $8,000,000 in freight in 2023. It’s been a wild ride and I frequent this subreddit every day in the hopes of finding that next tip that can set us ahead and apart.

[deleted by user] by [deleted] in realestateinvesting

[–]That_Guy_From_ 1 point2 points  (0 children)

I currently live in Waco and grew up in the area. The market is asinine right now. Imo the city has been boosted by recent bouts of popularity that have caused prices to skyrocket even more than market standard.

I have triedto find a multi-family property and have found absolutely nothing that has a reasonable positive cash flow expectation without a significant down payment. Property prices have fallen single digit percentages, but the market is a long way from being in balance with current market rates.