Thread: Loans?
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Old 10-24-2012, 10:20 PM
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PROCUT1 PROCUT1 is offline
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Join Date: Dec 2003
Location: TN
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Well guys.

Everyone is right in my opinion. The cash guys. The finance guys. Every example makes sense.

90% OF SMALL BUSINESSES FAIL.

If everyone has all the answers and knows the right way, why do most struggle to make payroll everyweek or why do I hear from my supplier that he has to make collection calls to 80% of his accounts?

The fact is things dont work out in real life the same way they do on paper. I was doing a million in sales, less than a million in expenses. Yet went out of business.

If I got one check a year and had to pay one bill. I would have a nice fat bank account.
On paper I was making a ton of money. Yet everyweek i struggled to pay bills and make payroll.

But on paper, there was nothing wrong.

I was not living beyond my means, I was not financed beyond my means. I didnt buy more than I could "afford" but I couldnt make the payments.

How is that possible?

Human nature and inexperience!!

Now, I talk on a larger scale then many are. A solo op, well in control of his business, financing a ztr....Not a problem. Id do it. You can control that easy.

How about when youre trying to grow big, and fast. And taking jobs that require financing a lot of equipment very fast, and then taking the task of now running a business instead of running a job. Without the experience and knowledge of running a business.

THATS what my threads centered around. THE TIPPING POINT.

When you got a good handle making love to one woman.
Then you get two at once....THAT WAS AWESOME.
I want a WHOLE ROOM FULL OF WOMEN.
They walk in.....You say....I GOT THIS!!!!
Then you realize shortly into it, youre trying your butt off.....But you dont got this.

Managing a book of business with simple, money in, money out is easy. Youre not going to bankrupt yourself out of business when you buy a truck and a new ztr on credit. You have a good hold on it and know if you can afford it. "My first 10 lawns of the week pay the truck note, My next 5 lawns pay the ZTR note, I have 50 lawns" Easy stuff.

Its nice that there are so many people that are born natural corporate financial experts on here. Most dont have that experience or education.

I know how to run a company by the numbers. I know how to calculate. I know how to run by the book to be successful. But when it comes down to it, the real world takes over and I cant follow it to the accuracy that it needs to be followed.

I know I cant do that. Most people cant.

My way isnt the only way. I do things now that dont add up on paper to make the most sense or be the best way. But I like the discipline and safety of that approach.

Every job I do I have to have someone run back and forth all day with my 500 gallon tanks to the supplier to keep up. Burning all that gas and all that payroll. I need a 2000 gallon tanker truck. Add up the gas and payroll alone, it would make the payment. I could get jobs done faster, free up an employee, free up other equipment, grow faster, burn less gas, be more efficient.

On paper it makes so much sense. Im drooling over a nice red Peterbilt online right now that I could have tomorrow if I just make one call.

But Im holding off. It takes me a little longer to do a job. I dont look as cool. I just know myself and I know that I dont have the discipline to go down that road no matter how well I know the business.

You just think different. There is something about the pain of writing that check that feels right. Something about looking at your bank balance right after and even though you bought something you needed and wanted, you feel a little sick.

But in the end. This way.....The bank balance bounces right back and grows and very shortly I dont even notice that purchase I made.

Yet, If I were paying $300 a month for it.....Somehow It never worked the same.
So my personal opinion. There are examples of successful business on both sides.

To run a business with heavy financing requires skill, discipline, and education that most people do not have or cannot apply.

To run a debt free business is much easier. You have the money or you dont. You buy something and either you have more work to replace the money or you have a piece of equipment and no money.

Either way you have something.

Again. 90% of us fail. Ive failed more than once. Im just too stubborn to give up.

But for the first time in my life, im going into winter without a care in the world. Im going to park all my stuff until the spring and it wont cost me a penny.

Hopefully others who finance, did everything right, saved all year to make sure they had the winter payments covered, hopefully nothing comes up to have to divert that money, and they can write those checks every month and be just as stress free as I am.

If thats the case. Are we both not doing the right thing?

My gut tells me there are many more however who are like I was this time of year.

Looking at the checkbook and wondering where that pile of money that the balance sheet and P&L statement shows that you are supposed to have right now to get through the winter is.....

Now youre thinking......What can I do for work all winter to cover these payments.
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