Retail Business with Guest Ken Petersen

Retail Business with Guest Ken Petersen

Show Video

Hello and welcome to another episode of On the Floor with Wayne and Rob. I'm Wayne Highlander. National Sales manager for Bona Adhesives.

And I'm Rob Johnson from Bona Training. How are we doing, Rob? Pretty good, but how are you doing? I'm doing fantastic. I think you need to. Clear your throat. Me? Yeah. Give yourself a good throat. Clear? Or is there something wrong with my microphone? It must be your microphone or.

Headphones or. Whatever. So today we have a special guest. And I think this is a this is an interesting topic for our for our audience is a about retail stores and starting a retail store and coming from being a contractor and moving towards being a retail store owner.

Our special guest today is Ken Peterson. He's with Woolies Hardwood Floors Ltd.. And Ken, I know you've been, I think, since 1994 in in Calgary, British Columbia, in that area. Yeah. We've had 94 is when we we opened our first retail in Calgary, but I started wood floors in 86 in, in the East Coast where we were raised, where I was raised.

So I started my first retail store in by remote. I would say 90, 91 wasn't long after we got going contracting. So we yeah, we started our first retail there, then we sold out and then moved to the west Coast. Gotcha. So you've actually been styling since the late eighties, though, right? 8686 is my first floor that we've installed. Yeah. A lot of a lot of experience there.

And I want to give Wood Floor Business magazine credit for four for this. You wrote an article in that magazine and I read when I read it, it resonated with me so quickly. Just one thing that you said in that article, I thought. Yeah, I thought the same thing and something to the effect of that. If you're a contractor and you're going into owning a retail store, the best thing that can happen to you is that you hurt your back.

So you can't do floors anymore. And I used to say when I was doing floors and I wanted to grow and get bigger and perhaps do a retail store, is that I think I'd be better off if my knees hurt so bad I couldn't do floors anymore. It wasn't even an option. Yeah. Yeah, you're right there. Yeah, no, it is.

It's. It's the truth. It's a it. I don't know what it is, but if every, every, every flooring contractor, every guy that's swung a hammer or a sand in the floor, seems like they always want to have their own retail outlet. They want to sell their own floor and they want to do their own thing.

And, hey, the hat's off to them. That's that's how we all grow and get bigger and do things. But it's a it's one business, this wood flooring business.

There's one thing that it's a tough grind and you got you better know what you're doing when you when you change careers. So. Yeah. So in that article as well as the other meetings we've had I always say tell guys blessing. Best thing you can do is hurt your back.

I know a guy that started a retail outlet and broke his Achilles tendon right. Right off the bat. So easy start. Listen, you know, I devastated. I thought that was the end of my retail.

I thought what he says was the best thing that ever happened because he's said to rely on my guys. I learned to rely on my guys to do everything. And then I, I learned that I had to push pencil and I had to organize.

And it taught me that sitting in a desk with a broken Achilles tendon is taught me how to organize. And he says that was the saving grace for my following. Start that. Learn to go back out with your tools and and work is very strong because you know it's. Yeah. Go ahead.

I tell you, the problem is the reason you want to be in into retail is because you're good at what you do. You're good at installing, good at finishing. And and when you walk in, you and you'll get a customer come in the door and you look at the plans and you look at the job and you say, That's a good job. I want it. I'm going to get that job.

And that customer just walked through three boring stores and you're the fourth one and you're the newest guy on the block. So there's only one way you're going to get that job out of a referral or you be the cheapest. So the first thing the installer says is, Man, I'll install it myself, I'll, I'll install it for myself and I'll knock a little bit of money off too and, and I'll get this job and, and now all of a sudden you're devastated because your flooring store is suffering, your rent is still there, your overhead is still there. You're out installing a floor that could it could be going sideways halfway through the job, but you got to stay there. Meanwhile, the phone is ringing. It's a downward spiral from there.

We have seen it so many times. And that's why, you know, I spent a lot of coffee shop talks with guys and telling them, go for it, do it. But I'll tell you this, change your career. You are a changed career.

You're not a flooring installer anymore. Yeah, you know, I can tell you, we manufacture here and sell to someone, some retail outlets. We don't want to categorize everybody. But, you know, I got a guy that's calling me right now from from Florida. He wants to open to flooring starts. So that's nice.

I said, what's your history? You know, I'm an installer. I know my stuff. I've been installed for 25 years.

I said, what? I'm not interested is what I said. I'm not interested in selling your product. Why is that? I know you have a good product. I want to know your success rate is so low that I don't want to sell your product because I don't want to get stuck and I want to get stung. And I says, You are still telling me about your installs and how you installed the biggest star and how he installed the nicest.

That's gone. You are businessman. I could tell you are most successful foreign companies that we sell flowers to our guys, that they're businessmen. They're they they don't really know everything about install. They really don't know everything about finishing. But they're a businessman and that's that that's a tough thing for a tradesman to become a businessman, but it can be done. I did it.

I fell on my face a few times, but I did it. And lots have. But it's it's a tough goal. And that's one thing I've come to realize, too, when I when I moved to my role as a sales rep and now sales manager, that it's been surprising to me that how many successful retail store owners that I know have never done floor in their life. They're business people. Yeah.

So and you're speaking. Wow the reason why I like you on here because you're speaking from experience. I mean, you came from both sides of the world.

So how do you change that mentality? Because you have to you've got to change your way of thinking altogether. Right. Still, here's an analogy that I come up with a while ago, because, you know, when we were running, cruising, when we had Woodies fine in Calgary, we had we're running 37 crews. We're doing an average of 9 to 12 houses a day.

We're going through 80,000 square feet of wood a month. So we were moving, we moved volume. We did 276 builders. We controlled about 23% of the hardwood floors are going through that city and the city is over a million people. So we we moved a lot of product. We a lot of guys come through our doors and work for us.

So here's something that I've told them all I get guys come to me as just be honest with me. You want to go on your own, come to me, talk to me. I'll tell you the pros and cons. So here's something that I tell the guys.

I don't know if they listen or not, but I do know it works. And it not only works for the wood for business, but it works in all service business. If you're an installer or a finisher, let's say a sanding and finishing guy.

So you're sending a finishing guy and you're working hard with your helper and you've got you've got a good reputation and works piling up. And if you do a good work, you will get you will get busier. That's just this business. So the first thing that comes to your mind is I need another crew, I need to get another crew going. So you lay out the money for the van and the tools and everything. So now just say when you were working with your helper, you were getting $100 a day.

That's what you're making, $100 a day just for round numbers. Now, you brought on a second crew, but now you can only make 75 bucks a day because you're managing that second crew and that second crew. You got to pay them guys.

So you're only making a 25% or $25 margin off them guys. So that crew's making it 25 bucks a day because you're working your own crew, you're making 75 bucks a day now. So you're making the same amount of money you're making when, when, when you had you worked by yourself. So work keeps piling up.

You get busier. I got to get another crew. So you bring this third crew on. Now you have three crews yourself. The other two crews, they're each making you 25 bucks a day.

You're managing three crews now, estimating, collecting, don't touch ups. It goes on and on. So you're only making 50 bucks a day because half your time is managing the other two crews. So you're still only making 100 bucks a day. So that happens for the third crew. The fourth crew is now all of a sudden you've got you've got four crews and yourself.

So you have five crews, but you can't work anymore. You got four crew. Your day is is run ragged because you have four crews to take care of your estimating. You're collecting money, you're doing touch ups, you're fixing this, you're touching up that, you're fixing a Hummel, you're fixing a edger, you're running around, right? So you're only making a hundred bucks a day because each crew is giving you a 25 bucks a day.

But you can't your production is done. With a lot more with a lot more liability, too, I should say. Four times the receivables, four times the payables, four times the headaches. So usually about this time, most contractors say, I'm done, I'm done, I can't do this anymore. And they do one or two things. They scale back to themselves or they go broke.

And when they go broke, all the local wholesalers and everybody that's supported them feels the pinch, too. So that's that's the biggest thing that you guys got to be careful of. Now, how do you get past that? Well, it can be done well, when we when we are running big crew, one guy could run up to seven, six, seven, eight crews himself. No, no. Without a problem. So you got to understand, you're done working your you're not working anymore.

You're not touching tools. You know you are. And you better have a good bookkeeper. You better have a good accounting service, and you better not cheat your numbers because I don't know if the US is like Canada.

Revenue Canada doesn't lose. So you got to know where you're at and you got to know where you're at. Every single day.

Right now, we're probably top heavy on accounting just because I've learned my lesson late. We've we've we've been there. We've we've got spanked.

But it's it's it. There is another way around it, though. You can you can keep going and you can go to four crews, five crew, six, crew seven and manage them yourself.

But you have to be at career change. It has to be a career change. You know, when I when I saw what is out in Calgary and then I come to corner here to never, ever do what he did, never ever do hardwood floors again in my entire life. And and here we are doing wooden floors. But when I started when I started installing, sanding, finishing, and then we went on to manufacturing and retail and everything else, but I vowed that I want to start, but I'm too old, old and fat lazy anyways to to do it anyway.

But I vowed I am not touching tools. I won't go any floor I laid was my daughter's house but I just won't do it. Just I I. And if you can discipline yourself, then it gives you the freedom to be able to manage. And that's that's the key.

It's a proven fact. This is no it's no, it's no joke at all. It's less than 10% success rate of flooring companies that open up as a flooring contractors, less than 10% make it.

It's not if you're if you're managing all your crews who's managing your store? Well, that's that's that that's the whole thing. So I'm just talking about if you're building crews now, if you want to open a store, you better you better be running at a lot of crews. You better be running a lot. A lot of a lot of the only reason I have two retail outlets right now like showrooms, is because we manufacture. There's no way I'd open a showroom if I had to buy the same product from the same wholesaler as a carpet store across the road and try to sell it. I wouldn't do it because the only way you can get you can beat that beat them is you have to be cheaper or you or you have to have a reputation where you can have a reputation because you're new.

You're new at the game. So opening a store, is it that's a that's another that's an we call them to cancer. You just you just created a cancer and it's eating at you every day and.

I'm going to. Wait. What, like opening a store? Like we're looking at a store in Calgary right now.

We're saying, you know, this the showroom is not is not the expense. Three grand a month, I can have my showroom, but every person I put in there, five grand a month and I give them a sales car and a gas card and a commission on every job they make. And you have to have two salespeople to run the store because they all kid. One person can't be there all the time. How are they going to do their estimates and everything else? So you get two salespeople. So all of a sudden that store's $20,000 a month just to break even.

Well, $3,000 was a showroom. That's a small part of it. And that's the problem. Every guy who walks, drives by the mini strip mall says, yeah, I can I can rent that place for 2500 bucks a month. I got my own store. Okay. How are you going to staff it? Who's going to keep the lights and everything on? Who's what about your sales cars? What about your escalators? What about your commissions? That's that's the killer.

So it's and back to the same thing installer looks says 2500 bucks a month man I make that in the first six seven days of my week. Have my months to cover my rent, but do all the rest of the numbers and everything else up. And all of a sudden you've got a big burden that you got to carry every month.

And then and the problem is then you get into it and then they say, Man, I, I got to get these job. I got to lower my price. Now you lower your price. Now you're working cheap. Now you're working cheap now. Now the wolf is well, you have one screw up and you can't afford it.

I got a job right now. It went sideways and you get jumped. Go sideways. That's this business. I got a job right now. It's a 40, 40, $2,000 job.

It's sideways. It went sideways. And now we're in we're in a push pull match on this job. Now we'll start it out, I believe, in the long run.

You just back off a while, let the customer calm down and then go out, sit down with them, talk to them, figure it out, come do it again. But. But they're sitting on $25,000 of my money. Well, if you're running things really, really, really tight, well, you're in trouble. You're in trouble. Big trouble.

I think also that the game has changed. And I think there's a important distinction that we that's kind of related to this. And and I think it it goes to setting yourself up for success or failure. In the past, you needed a website to support your retail store. Now you need your retail store store to support your website. If you're if you're doing things if you're really, really touching a lot of people and what have I mean, I think that can help you a lot.

I think that, you know, with COVID, I saw an 80, 84 year old lady at a diner, opened up her cell phone and using the QR code and showing the other lady how to use a QR code to look at the, the, the menu. That's how people are buying. Now. So I think you also have to look at if you're not on that side of the business, if you're not really savvy on that, I think they can also put you behind the eight ball because technology change.

Absolutely. You know, I tell you what we tell, we tell people here, we're we're a marketing company that does hardwood floors. So we we're big in marketing.

Our Google stuff is bang on up to date. I have a guy that he does work for. We hire him to do we are bang up to date on all our Google stuff. And I can tell you this, there's only two advertisements I do the only two ways advertising and one is I do billboards for the drive by and the only reason I do a billboard is for branding. So just to put that, that what is in that bird into their head every time they drive by. But the only other advertise we do is is Google.

Google is the largest advertiser in the world, and they're not even an advertising company, but it's Google. So the way we do it is no secret. I tell you exactly how we do it. We hit, we hit the billboards to to put it into the air. So nobody drives down the road, looks at our billboard and says, Hey, honey, we should get hardwood floors. No, it doesn't happen that way.

But what they do is they're home sitting on their couch in the evening and he says, you know, we should look and get new wood floors. Yeah, first thing they do, they grab their laptop or their iPhone and they go, boom, boom, hardwood floors, cloner, punch it in oh about six company oh woodies we know them well. You don't know us but you know our billboard every day on the way to work and back instantly. Who's going to get the first call? Yeah, we'll get that first call.

There's what they call the tend to roll in and they figure now consumers will spend 10 hours on the Internet researching into our shopping where they used to go like to 2.8 stores before making a purchase is now I think it's 1.2 stores which are the millennials which now up into the forties.

That's an it's going to grow it's going to be a bigger audience than that even so, I mean, I think it's such an important part of the business. There is one person who who I know that that seemed to master this whole thing with retail stores. And it's Rob Johnson. You want to tell him how successful your operation was, Rob? So you want to talk about the wood floor corner. That was the name of our store, wood floor corner.

It's funny because you were saying, you know, how are you going to staff it? So I got my partner and our two wives together and we're doing a lot of work and our name is getting pretty good. So I said, we got to have a store, found a place right on the corner in main Street. So it was good drive by traffic and everything. And they everybody was saying to me, How are we going to staff it? I go, Oh, you mean how are we going to stay? There's four of us.

We'll be able to cover this. No problem. He had kids.

I had kids. But I said, now the wives will do it will work well. Wow. Was that ever.

We ended up being open Saturdays and Sundays and we tried to do nights and then we tried to do just calling in and it ended up really being like a hangout for our buddies to come and drink beer and watch the games and stuff. And it was a that was a complete disaster. Absolute disaster.

One of the biggest mistakes I ever made. But we we were trying to run a store and go out every day and do the business and do the estimating and everything. So it just just didn't work. It's it's at the retail stores and it's not the rent. You probably never had a problem paying the rent at the river. No, no, that actually I think we were ticking people off more than we would have if we didn't have the store, because all we heard was, yeah, we stopped by the store and nobody was there.

You weren't open. You never opened. What are your. Our yeah, that was just, you know, we thought we'd be able to cover it at night. Maybe the girls could cover it, but now we found out that right away you need to have regular store hours.

Maybe you can go a little late into the night. The only thing I can say now, though, is I can tell you, because we make a high end product and we're not an impulse product like everybody that buys our product has Googled it and done their homework. They they didn't just drive by and then walk in and say, hey, didn't see you guys before here. Well, how much is the most people that come to our store have either emailed us, called us or texts already? And that is a bit of a benefit. Now, I can tell you that for every customer that does a $4,000 purchase, they have Googled or searched you or LinkedIn or done something five times before they even made a phone call to you for anything over a $4,000 purchase.

They'll try it. We do it too. We will have it. We'll have somebody come in to our shop. It's kind of funny because Tim and I'll sit there and they'll come in and they'll they'll speak like an interior designer or something. And I'm this, I'm that. I can do this. I can do that.

And she hasn't hit the door and we both punch in her name into Google. But who is she? Is she is she what she says she is? Is he what he says is has he done what is that with. That's it.

And we just look at each other, we start laughing like, what the heck, we're both doing this that see it. The tool is right there at your fingertips to find out about anybody and anything. Right. So the same thing with a store now. Yeah, that was the case for years.

Like everything. Hey, the only advertising we did for years was Yellow Pages and our vans. That's it.

But it's a different game now, I can tell you even even on. We used to do a house, we used to we used to do a floor on a house and it would and we automatically would get two or three calls for estimates on that street because and the first thing they'd say is, hey, you just did Bert's for man. Does it look nice? Can you come up and give us a quote now? Nowadays, 25 years, 30 years later, we'll get that same phone call. Yes. And they'll give their address and that's it. So we'll go do an estimate.

We'll say, oh, we just done a job four doors up two weeks ago. And the customers say, yeah, we've seen your vans or We seen your sandwich board. Oh, yeah.

Did you stop in and take a look at. Oh, no, no, no, no, no, no. We would never. Did you to call the homeowner? Did you stop in and ask the motor? No, no, no, no, no. But do you know what they did? They they read every one of my Google reviews, every one of them. But they would never go over to that homeowner and say, hey, how do you make it was Woody's was your floor good.

Did they do good work there? But no, they won't do it. They're rather go on Google reviews and inserts the heck out of here on the Internet and then they'll make a phone call. It's it's a different game now. Okay. So a couple of things. One is like I this is not intended to be like negative, like to deflate somebody's guy's dreams or whatever.

But I think you could also save a lot of people from a lot from heartache, number one. Number two is I remember in 2007 when the economy crashed and I would talk to different contractors and it was two different camps, one group would say, man, I should have opened up a shell room. Now I'm slow, there's no work. And the other person would say, You know what? I open up the showroom as well.

I should never have done it. I'm losing money on this and blah, blah, blah. But you know, as you say, the game has changed now and so what does work? What I mean, there's no I don't think there's any shame in working out of your out of your warehousing at home. And, you know, staying small. And, you know, I'll say that my brothers have done that. They have no desire to grow.

They could they could have had many, many more people than they have working for them now, and they have no desire to. And I actually think it's a smart business plan in a lot of ways. Well, I'll tell you what, we're doing it we've rock the boat pretty bad here for people for contractors in Kona because we're it's a smaller market like in Calgary with 1,000,004 people.

There's a lot we have quite a few contractors that we have no prices on any of our samples and they know where the manufacture. So like I know one or two different contractors right now they'll call up our salesgirl there and they'll say, Janine, I have a customer coming in there. Could you show them this business? And yeah, absolutely.

And so when they come in, they say, hey, could could I see? Yeah, no problem. See, this is shows all the stuff. And then we give that contractor of course a reduced price. But we, they don't customer doesn't talk price to us, but we're letting them use our showroom. We, we just want to move product, we want to move product. That's all we want to do.

And so and I don't care, it doesn't matter to me who the customer is and who or who has electric. So we have contractors, the foreign contractors that use our showroom to, to, to and then we sell them to wooden and they go ahead and do the job. We don't have nothing to do with the job. So I encourage that a lot. And even the wholesalers, like I don't know if I was a wholesaler and had a whole I would put a showroom in and tell all my customers in the wholesale there's a showroom for you use it and and and that way there because all the wholesaler wants to do is move product but if it sure helps the contractor.

We have a distributor here in Albany. That's how he does it. He has a really nice showroom and everybody knows you send their customers there. They never talk price.

They don't have prices on any of the samples or anything like that, but they get a really nice showroom and it's geared just exactly for that, for their contractors to send their homeowners, sometimes they'll meet them there and then sometimes they'll say, Hey, stop by here. They're open five days a week, stop by any time. And, you know, talk to one of these two guys and they'll take it from there. So no idea. That's a right way.

Nice way to. Yeah, absolutely. And so we encourage that with our showrooms. Same thing like we'll sell wholesale to the contract. But you know, I also have a lot of contractors, I have a lot of contract all over Western Canada, guys that even used to work for us. But guys are really good operators and they work out of their garage and they have a good clientele and they do good work and they work by themselves or maybe one crew helping them.

And they'll call me up to say, Can I got a seven and a half inch white oak floor that I need, but I need like a mocha stain on it. Can you, can you fire me some samples up? No problem. So I'll just I'll call in in the back. They call runs, run a 2 to 4 boards for mocha, stand.

We're going to send it off to so-and-so next day. We peer later to him. He's got it in front of his customer within about three or four days. And then lots lot of times that doesn't work because on the first call, he'll call me up. Say, Ken, it works. But we need two shades later. No problem. Run two boards. Ship them up.

What? 25, 30 bucks a ship each time it's a ship, a showroom he's ever had, and he's got a product that nobody else around him has. But and that's and that's partly why we decided to start manufacturing and finishing it is because I think there's room for the little, the little manufacturer that does specialty stuff to service the contractors. So we talk about we're going to have a conversation here with Sprague Lane on another show coming up soon. And we're talking about how important relationships are.

And you see retailers and guys that work in, you know, in their in their garage, I'd say, are two different audiences altogether. And sometimes they miss each other, you know, and sometimes they like they resent each other, but they really can work together very well. And and so they're both there benefits.

Absolutely. Absolutely. For sure. Yeah. But, you know, it's the same thing. There's the one contractor who just who wants everything and the other contractor who charges his rate, who is right price and makes margins and is.

Yeah it's hard to school everybody on everything but I do know going back to the showroom and how to on how to build crews multiple crews I will I when we started building multiple crews and having a showroom and and doing doing what we did every day with as many houses. We I did realize that you need dispatchers, you need guys to run crews. And I tried to bring in a sanding crew, a sanding guy to do that. And that was a disaster. He all he wanted to do is reteach everybody, retrain everybody and do it all. Had to do it his way.

So and I brought an installer in it was the same thing. He didn't want to be there and they didn't want to listen to him because he was just an installer. So what I did was I just I looked at all the builders I did and I thought, who's the best project manager of all these builders? And that guy's name come to my head and I phoned him up. Next day I says, Hey, will you come work for me? He says, Doing what? I says, Dispatching crews. He says, I work for a builder. I'm it.

I'm a project manager as well. When you get pissed off, call me. So anyways, he did well six weeks later or so he called for six weeks or something. He called and I know what he wanted. Let's go for lunch and he come and work for us and he refresh for years and he dispatch crews, he run jobs, dispatch crew and did a heck of a good job of it. But he didn't know hardwood.

He didn't know hardwood floor. He he knew that. But he couldn't lay a floor. He couldn't finish a floor. But, you know, the guys respected him because he wasn't trying to teach them and he wasn't trying to tell them.

And he was a he wasn't he was a project manager and he knew how to manage and he knew how to schedule and he knew how to coordinate. And man, did he make our life a lot easier. And it's the same thing. Is it him? You can't bring a contractor in and make him a business man is tough to do. You can't make a sanding guy or being a dispatcher. A guy is an old saying you are in your life and Zachary is supposed to be like, yeah, that's why you're there.

Is because that's. But you know, like you said, though, you don't want to discourage everybody. You don't want to say, boy, don't ever do freak out because some of us have done very well at retail.

But it's the biggest thing is it's a career change. It's a complete career change. Craftsman. Craftsman want to do craftsman stuff.

Exactly. Craftsman don't want to be sitting at a desk and pushing pencil and they want to do craftsman things. But the problem is, I don't think they manage it good enough where they're they should be getting paid the way that they should be because they're out there doing the craft.

So why is it every flooring contractor I know thinks he has to give a deal to get a job? It drives me crazy. Yeah, well, okay. This job. Okay, back to square foot to Stanford. Oh, it's really good.

And I really want the job. Where I can. We're going to ask you to go back and listen to a bunch of our episodes. Okay. We don't talk like that on this show.

No, everybody's in a race to the top. Who's listening to this show? That's right. Yeah. Yeah, I wish. Well, how? Tell me how important a bookkeeper is.

And a lot of people think that's an expense. Oh, gosh. Another I got to add another expense to it.

But why don't you talk a little bit about that? Because I think it's it's a game changer. Well, I'll tell you how we do it. We do it. We're a little top heavy in him, sits at the desk and he does data entry all day and takes care of all of our admin stuff. But then we have a bookkeeper that comes in every month and picks up everything for that month and through the QuickBooks and make sure it's right.

And then everything from there is handed on to accountant. I know it's probably top heavy, but I've learned in the past that you need to know your numbers. You need it. Good numbers or bad numbers you need to know and you know, if we're contractors and we're working and we're doing stuff, we like to fudge our numbers, we like to think we made more than we really did where we like to think we did a little.

But if you give that to a bookkeeper, she's going to give you your real numbers. She's going to tell you exactly what you did. And I remember arguing with, oh, no, no, no. I know I made more money, but. No, no, no, not here it is.

Count. Here it is. Is black, white where you made more money? Where the money go. But no, I know, I know.

I was so busy and we did this job. No, this is it. This is what it is.

And if why it's important, it's really, really, really important. Well, you know what? It just. Just screw up and let the government come after you. It is game over.

Here's why that is so important. And that's one of the I think the most important thing you said today of and it's been great information. You can fall into the trap of thinking you made more money than you than you have. I think I'd say 80% of the people do it. And then the problem is that compounds. And if you start thinking, oh, I made this much on this job and you start adding all that up.

So a lot of money and it would have gave you an opportunity to capture that money and find out what am I doing wrong, where I where I'm not? What do I need to do? I need to raise my prices. I need to change my process. Do I do I look at smaller, bit smaller jobs and build them completely differently? And that's so important that you do that.

So we're the same thing. We have a male workshop that knows all our wood and it's it's a down the road as a ways away from our pre finished plant. And we're looking at the numbers, you know, the operating numbers are just too high.

So we look at the rent, the rent 6000 a month for that warehouse. Right. And we're saying, man, how can we cut that rent down and get looking at I pay one guy 7000 a month whose rent is not my problem. Staffing is my problem.

I you got to watch every nickel and you can't just zone in on something because you think that's your problem. You got to you've got to know where you're not. I look at my staff on my own staffing, that email workshop. I'm like, Who helped me make this a little more rare? But going into it the first, you think, Oh, rent's my problem. No, rent ain't my problem.

I got guys make more. Half my guys are making more money than the rent bill. Yeah, well, and then the other thing you kind of fall into the trap of. I work my, my, my butt off in this job.

I deserve this nice Denali truck. I deserve this thing because I'm working 90 and 90, 100 hours a week. And, you know, all that plays into a man. So you'll see it every time, every time a guy opens a foreign store, he buys himself a new truck. Me to a donut. You do it.

It's out of my head. I go and you sell it to yourself. You sell yourself. I got to have that image.

I got to get the sticker on the truck. I got I can't drive around in a van doing estimates. I got to have a nice truck.

And I'm not just having a little drive a big truck, and I'm going to have a lesson. I wrote the book on it. I've got the T-shirt, lost the t shirt on that one too many times. But it's the truth.

I always say We all want to be the big shot. Not dumb. It's just it's our nature.

It's. It's we all want to have the biggest cruise, the biggest jobs to be missed. It's. It's our drive. It's. It's just our nature. It's it's western world thinking. Yeah, yeah.

You know, you were talking about hiring accountants, and I got a pretty good story about the accountant that we hired. Right around the same time we opened the store, we finally got audited. About four years of this guy. We got called into the IRS building and they started off the whole meeting with. The good news is there's not going to be any jail time for you or your partner.

Oh, that's a good yeah. That that was that was the good news of the day. So you must have some pretty good stories, too. Well, first of all, you know how to hire an accountant right now. No, I don't. Okay, number one, this is. No person.

First word interview with the accountant. What's two plus two? And he says four. He's fired right there. Yeah. His answer is supposed to be, what do you need it to be? That's a good at count. There you go.

Oh, yeah. You know what? When you rotate as much floors in as many jobs and stuff as we have things, crazy things happen. Like really, really crazy. I'll tell you one, we wrote an article for here a while ago and I tell you what, but so we did a job, this guy, and he wanted us to do his house to the two floors, the top floor, main floor, and the top floor of his whole house. And that's back in the old sand and finish two and a quarter Red Oak select and better stand and finish the whole thing.

He says, I'm going to Florida for a month, he says. I'm going to take all my furniture and put it in the basement. The whole everything is, I want you to come in here and I want you to hardwood the whole thing, except for the bathroom in the laundromat. So we said, sure, absolutely. So where we get going there, one of our crews, we had multiple crews and so they laid all the floors and got it all done.

And then they're sanding away on the top floor around a toilet flange and a half bath. The edger tilted down into us toilet flange a little bit and jumped across the floor and cut the waterline right off the rate off flush for the floor. So now we got a half inch waterline hitting the roof, straight water coming straight up out of the room. So the guys for me can this is what happened. I said, well, shut the water off. Well, we can.

The base was full of furniture. We can't even open the door that full and we'll go round in the water out of the walker. We go in. We tried it. We can't. It's full. This is what I call the fire department.

So they call the fire department. Fire department comes out, looks around. Well, we got to show up on the curb.

Can't find it, can't find a water shop. So they call down to the apartment. They bring up a metal detector. They find it under the concrete driveway. So they can't they can't shut the way. We're talking hours later, water still running.

There's nothing you can do. So they call the city. The city comes out, does the same thing. What they do, try to find out what? No, can't find it.

These walls start empty in the basement. Well, that basement was jammed. They'd be half a day emptying the basement. Well, water was coming down the stairs like a waterfall and the ceilings were dropping. The cabinets are falling, everything.

But anyways, the city says we have to water off for the subdivision, so. Well, that's a bigger key. So we get down to the dispatcher, get this key, come back up, shut the water off. We're talking like four and a half hours later, we got the water turned off to that whole subdivision.

Well, we wrecked that house. It wrecked it. It wrecked everything in that house. No, there was no the water basement, was it. The ceilings all fell down there. It is the worst as well.

I guess we're not getting paid for that. One was. No answer. And stepped in and took care of the whole thing. They just yeah.

They our insurance did the whole thing. It was, you know, I called that guy down in Florida. He actually was a former drummer of Bryan Adams.

Right. So he had he was a really, really good guy. They he he says Ken, exactly.

This happened. I get it. I get it. This is you know, I don't like it, but I get it. So and he was really good about it.

I just told him, I said, you know, a whole bunch of multiples. One is if the basement wasn't full of water, first of all, we hadn't hit the water line. The basement wasn't full of furniture. If the concrete wasn't overtop of the water shut off.

If they just one, two, three, four, and yeah, it hits it. All of a sudden, you you're swallowing it. But it's not that Pete and I had the almost same thing happened to us. We nicked a water line going through a refrigerator. So we go downstairs to turn it off.

But a contractor, like a month before we get in there, had finished the basement. So they put sheetrock on the whole ceiling. Everything was completely covered. So we couldn't find the water. We had to call the fire department.

And they came, turned it off. They found the place outside to turn off. But yeah, I mean, I'm not I bet it was less than an hour before they turned the water off, but I couldn't believe the amount of water that was in that house in that one hour. I mean, it was just brutal. You know, one time we were and we did this job for this guy, and we we sanded and finished this whole main floor of his bungalow house. And he says, I don't I don't really care about anything here, he says, except for one thing.

And he holds up this team Canada jersey that's signed by every hockey player in Team Canada. What year? I don't well, this would have been about 98, 99. So whatever was just around that timing could have been 2000 in there.

So anyways, he's got this jersey with every player's signature. He says, I just don't want this. He had to show me this jersey.

I don't want this jersey here. Is that okay? No problem. So here we go in the sand. The whole main floor was he had all the furniture cleaned out, everything cleaned out, ready to go. We re sat in and finished a whole main floor and he come into the shop the next day after we're done and I thought he's going to kill us. He was so mad.

He was five feet high and climbing. He was just below and holding this jersey and that was back when you use oil based finishes and and he hung that jersey in the middle of that basement so it wouldn't get and down. And, you know, all of us guys had done it a little bit extra finish at the front door.

You just drop it into the hot air vent and down it goes. And it hit the seam in that hot air vent and dripped out of the bottom of there and all and right underneath it. And it went down to his jersey and run down and hardened about 4 to 4 inches off the bottom of that.

And it wrecked the jersey. And like, what is the chances of that whole basement? He hung right under. And I'm like, oh, man, we're dead. Horrible. Oh, my gosh. I know. That creates some crazy stuff. Happens.

It's stories like that. That's why you you keep all the hangers face in the same direction and in your closet if you got to get out in a hurry. I had one of my guys go, this is this is quite a few years ago back when back when your oil. But that's one thing I really really like about the water base is you don't get the you don't get the internal combustion in the sandbags anymore.

Again, I think I've lost three vans. I've, we've, we've lost a few houses. We. Yeah, we've had some but we're working in an area.

I'm not going to say the area in case they figured it out looking. Yeah. But you know one of my guys shows up at the shop a car after seven in the morning and and I'm sitting at my desk and he comes in, his eyes are like saucers. I says, What are you doing, Kevin? And he says, I need I need to talk to you.

I says, What's going on? You're supposed to be putting a last coat on that floor. He says, There's no holster, no more. Right? He says, I pulled out of the street and there was nothing but fire trucks and police cars. So what happened? I don't know.

I says you left your sandbags in that house, didn't you? Yeah, he says. I left him at the front entry. Just on the inside of the door. In the front entry. And I says, You got all your equipment out of there? Yeah, everything is out. I said, Well, then shut up and don't step anymore. We met.

We even got paid for the job. But we never, we never, nobody ever, ever figured out that. That is why that house burned. Nobody. I never heard another thing about it. You know, I got.

In a million years, you and it would never happen again. No, no, no, no, no. Oh, that's too funny.

Yeah, but, like, when you rotate as much work as we rotated it. Yeah, stuff happens, right? Yeah. You, you're in and out of a lot of, a lot of situations. Well and that's a good place to leave. It is. We're running up on the hour. A lot of a lot of cautionary tales there, a lot of experience.

And I love the stories, man. Everybody's got I mean, the water story. I was getting anxious as you were telling it, because I can picture myself that same situation. It's everybody's nightmare. Yeah, but I really thank you for coming on. I actually I'd love to have you come on again as a guest sometime.

I mean, you've got a lot of knowledge and experience and I appreciate you sharing with everybody. And again, we're not trying to scare anybody off, but just, you know, I think you're better off going into anything. Eyes wide open. No, you're absolutely right. And the last thing we want to do is not have no reach out. Oh, that's right.

Yeah. So we're not we're not trying to discourage you, too, but but but you know, hey, we're only a phone call away, too, right? Just pick up the phone. Hey, Ken, we got this idea or. Hey, but we're whoever, right? We've we've what's the. What do you think? What.

Let's look at numbers on the. I've sat across a lot of coffee shop tables and and I'm not changing their idea, their plan. I'm just saying this is what it is. This is where it's at. This is what I can tell you. If I wasn't manufacturing, there's not a chance in heck I'd have a showroom.

There's no way my our margins are good enough because we're cutting out all the middlemen and the guy across the road is not selling what I got. Yeah, and that's the only reason that I have showrooms. Interesting. Well, hey, can I again, thank you very much. It's been a great hour of discussion, and I think it'll help a lot of guys out and appreciate it.

If you don't mind, I might give you a shot one day to come back on. And and there's I'm sure there's a whole lot of years, years experience blessing I want to talk about down the road Canada and bears up there and all kinds of other stuff. We have our bears. And you guys got your alligators? Yeah, yeah, yeah. Is funny.

I go to Florida and they say, where are you from? Wow. Grizzly bears. I'm say, where are you from? Florida. Wow. Alligators. There you go. All right.

Good stuff. Good stuff. This has been another episode of On the Floor with Wayne and Rob and Ken Peterson with what his flaws. And please do stay tuned for another episode.

2022-11-17 02:04

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