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Shipping Quality Products, Company Culture, and Working Capital
221 Plays6 years ago
Entrepreneurial visions are known for being lofty, clearly defined, fixed ideas backed by extreme conviction. The truth is, visions evolve. Where you are now was probably an inconceivable thought back then.
If you're thinking of becoming a manufacturing entrepreneur but don't know where to start, the guys have one simple piece of advice that can be the driving force for your business!
Establishing Company Culture - Organic or Intentional? The Johns discuss the ideas behind creating a culture of excellence.
How New Employees Can Add Value Seek out and embrace opportunities! This isn't just about what's in it for you; it's also about the value you can offer. "In order to have a growing and fulfilling career, you can't just make decisions. You need to make decisions with opinions."
Honesty & Transparency - What Are You Hiding? When Grimsmo brings up a side project, he brings the core of the podcast to the forefront. The guys aren't just there to pump each other up. It's about being honest, even when it's not easy. Strap in for this heavy dose of truth.
Working Capital Big Check Cashed Late + High Number of Receivables = Not Good. Time wasted tracking down dollars and receiving ridiculous excuses leaves Saunders frustrated. Now, he's calling out the biggest offenders and it's NOT who you think!
Net 30, Net 60, Net 90 Do you negotiate discounts with vendors for early payment? If not, it might be a good idea to start!
DON'T FORGET!
Recommended
Transcript
Introduction to Business of Machining Podcast
00:00:00
Speaker
Good morning and welcome to the Business of Machining, Episode 144. My name is John Grimsmough. My name is John Saunders. This is the podcast when John and John talk about the successes and sometimes the struggles of running a small manufacturing business. A growing small manufacturing business.
Reflections on Business Growth
00:00:18
Speaker
Oh, do tell. Oh, just, I mean, both of us over the past just few years have
00:00:25
Speaker
I don't know about you, but I've exceeded where I thought I could be just a few years ago, and I feel like I'm just getting started now. You asked me five years ago how big you want to be, how many employees, blah, blah, blah. I don't think I would have been here. I didn't have the vision. You know what I mean?
Entrepreneurial Humility and Beginnings
00:00:44
Speaker
I didn't think big enough. It's funny. That's interesting. I really struggled to relate to
00:00:53
Speaker
I really, and I think it's that heuristic arrogance of an entrepreneur, which I hope I'm not arrogant. I really, really strive to think that I'm stay humble, passionate and enthusiastic, but not arrogant. But I look back and it's really hard to think about what it was like four or five years ago. And funny enough, you say that I actually was, I've been home my wife's traveling. So I've been, I don't know why that's relevant, but last night I was thinking about
00:01:21
Speaker
stuff on my own. And I remembered back to when I was in New York City, getting started and all this, I had my little tag and my little drill press. And I wanted to regulate my HVAC unit in my apartment and you couldn't modify them. And there was a contest on Inventables website. Inventables were directables. I forget which one. And the prize was like a two or $3,000 laser marker
00:01:46
Speaker
And that to me was, I mean, like won the lottery game over end of the road. Unbelievable, unobtainable. And so I didn't win, but I entered this contest. I built this Arduino device that would use hobby servos to rotate and push the buttons.
Unexpected Success and Growth
00:02:06
Speaker
And I had a little machined aluminum brackets and frankly, it was pretty cobbled together. But
00:02:10
Speaker
That was the first time in a while I've been able to actually transplant myself back in time and think what it would have been like to, like you said, see where you are now. Yeah, I imagine back then, what was this, 10 years ago or so, maybe more?
00:02:26
Speaker
being able to peer into the future and look at yourself now. 36 years old, kids, you didn't have or think about kids back then maybe, and business and everything. And now you have a laser that's many, many times more expensive than that, and it's one of your less exciting pieces of equipment.
00:02:44
Speaker
It's pretty exciting. Yeah, I guess. Rather than you and I just talking about our successes or growth, because no one wants to hear that, how does this help other people? What's
Passions, Dreams, and Improvement
00:02:56
Speaker
the lesson? What's the takeaway?
00:03:02
Speaker
I mean, you gotta be real with yourself, but dreaming big is definitely beneficial. I don't know, I think you and I over the past 10 years have just followed our passions, have just like gone after what we wanted. Without thinking too deep into the future, it's just like, I like this, I'm going to do this. This is super exciting to me. I'm just gonna get better and better and better at it. And that's fun, you know what I mean?
00:03:32
Speaker
Yeah, I think that's true. There has to be that innate passion, just that choice.
Small Efforts and High Standards
00:03:38
Speaker
I think I react
00:03:41
Speaker
I have a very strong reaction when people say, you grew so quickly. How did you get here? Because I'm like, no. And perhaps at the risk of paraphrasing, it was me and effectively one tormach for seven or eight years with no overhead, borking my butt off, not that exciting compared to certainly today's picture.
00:04:07
Speaker
And to me, it was those baby steps combined with, I like the phrase, I'm not a great machinist, but I can machine great parts. It's not to say we don't make mistakes. It's not to say there's not a day or a point in time where I have cut some corner or made some compromise because it happens to
Transparency with Mistakes
00:04:26
Speaker
everybody. But by and large, I would say the stuff that we ship is either excellent or
00:04:32
Speaker
If and when we make mistakes, they get handled in a way that's just done right. Every once in a while, we've shipped a product where we either got dinged in shipping or we made a goof, proud to say pretty infrequent. Literally, I think we had one person who received a fixture plate and was like, this just isn't like, you need to make me, you need to return this to me. This is not what I thought it was, something like that. It was one of those like, it's so infrequent that you're just like, dude, I'll refund you because it's not worth
00:05:00
Speaker
like you're wrong, but there's no point in even worrying about it. So get it back to us where we find you. But I think that's a big part of our growth, just because when I think back to some of the work we've done for other people, aside from just shipping products, I'm trying to think we've never had a customer who's been like, hey, this just isn't working out. Like I'm going to go somewhere else.
Customer Satisfaction and Quality
00:05:21
Speaker
And there's a couple of instances over the past year, I think that's really shined about how we've worked with folks
00:05:27
Speaker
tried to do the right thing. Not everyone out there is nice. Some customers need fired. But for the folks that are getting started, just shipping a great product, taking pride in that goes a long way. Absolutely.
00:05:43
Speaker
It's you get them to I'm sure you get those those wonderful like love letter emails or sometimes an actual letter in the mail from a customer that's just so blown away by whether it's the packaging or the timeliness or just the communication back and forth or the quality of the product and it's
00:06:02
Speaker
I mean, I want them to be blown away, but I also expect it now. You know what I mean? Like, of course, this is the results you're getting, because we put so much work into the process that it just makes me really happy to get those feedback from people, especially new customers, like first-time customers that have never ordered from us. And it just further reinforces like, yeah, we're doing this right, and people are responding well to it. So that's fun. Yeah.
00:06:29
Speaker
I thought of you, because it's like you and Phil, I feel like really crush it on the stuff that is easy to oversee. And when I look at the saga packaging that came, heck, even the Norseman case, and then Phil was posting those Instagram photos of those generative design parts he like five axis made for
Packaging, Design, and Excellence
00:06:47
Speaker
Hey you next week. They're insane and insane and then the next picture is Custom cut foam with like shadow relief logos in it and a good fit. You're just like, oh my god, it's incredible It's important, you know, right? Yeah, it's it's a mindset that you apply to everything and then the more you do it the more you can't not do it anywhere and
00:07:11
Speaker
I don't have Kaizen foam in my house yet, but I'm thinking about it. Other than a joke on my wife, I don't have any either, I guess. That's actually a good point too, what you just said there about mindset.
Mindset and Company Culture
00:07:24
Speaker
I mean, that's probably a good thing to think about. That's everything. To culture though.
00:07:29
Speaker
Yeah, yeah, that's absolutely and it's interesting now that you know, we've got two new hires past a couple weeks. There's so much stuff that the rest of us take for granted, just because we've been doing it so long that I have to remind myself to educate and bring those two new guys on board with the same culture, the same mindset, the same like, like, you know, strive for perfection, settle for excellence.
00:07:53
Speaker
in everything, whether you're kind of cleaning the floor or shipping a product. It is this mindset that permeates through every aspect of life and it's good, I like it.
00:08:08
Speaker
I hear so much about the next generation and the youth and training and skills gap. I get pretty frustrated because I think there's some pretty incredible opportunities out there. There's a balance of you have to make them or embrace the opportunities around you.
Advice for Young Professionals
00:08:26
Speaker
Not to say it's easy, but one thing I think about, and I think this is pretty solid advice for anybody in any position in their career, but especially for a younger person trying to get into the trades. If you have the chance to go intern for Grimsmo or work at Grimsmo or any cyber company like that,
00:08:44
Speaker
look at what he values. Look at what your boss, or the person that hired you, or the people you're working with. I bet you, if you shadowed John Grimsma for six hours, you would see that he loves things like that element of perfection.
Company Culture and Leadership
00:08:56
Speaker
I bet you would also see he doesn't have the time to do every little thing he wishes he could. If you can, not being a brown-noser, not being a suck-up, but just being like,
00:09:06
Speaker
This isn't necessarily, you know, maybe I'm not the kind of person that always goes back 10 minutes later and retypes my notes after a meeting or retypes like a setup sheet or, or goes and cleans up a CAD file or whatever the example is. But if he likes that.
00:09:22
Speaker
pick up on that queue because holy cow you're gonna become a very valued member of that team absolutely yeah yeah you're right pick up on that queue and there's so much subtle stuff that i don't think to explain but you almost want
00:09:38
Speaker
to osmosis, that kind of information. That's the goal, is to have this tastable company culture that if you came into our shop for an hour, you'd start to feel it in the air. You know what I mean? That's the goal. Does it happen by itself or is it very intentional? If so, I need to intention it.
00:10:03
Speaker
Yeah, that's the age old question of leadership versus just the person wanting to be there and kind of getting it. And it's that sharp criticism you hear. And I don't know that no gross generalizations are true because they're gross generalizations. But you do see people who come in and say, I need to learn this. I want to do this. I, I, I, me, me, me.
00:10:27
Speaker
And it's this flip it around. It's kind of like, well, what can you do for the company? What can you do to help us do something better or help your boss or help your team? Not just what do you need to get out of this? Because I guarantee you, you go work for Grimsmo. You're not going to leave in six months if for some reason you left and not have learned a bunch of stuff. There's tons of reinvestment of knowledge. And Alex, I think, was a great example for us. Alex learned a ton, did a bunch of work.
00:10:56
Speaker
You balance it all, right? He's at college now, but I very much appreciate having him continue to help out because he fits that mold. Yeah, he must have added a lot of value to your team and to your tasks and processes and everything you gave to him, right? Yeah, I thought about it, but not at this level of detail. But yeah, when we struggled with a project on a post, instead of saying, I don't know, or you need to show me, or
00:11:21
Speaker
that he would listen and then he would say, well, I've seen John do this or I know he's like, when I was on the robot club, I tried to figure this stuff out on YouTube or Google. Those are insightful things that aren't exactly shocking. Go look on the internet for solutions. Exactly. When he comes to me and it's not right, but he tried to figure it out this way, I'm so much more
Initiative and Decision-Making
00:11:43
Speaker
enthusiastic about shifting the direction of how we fix it or figure it out rather than the
00:11:49
Speaker
kind of ignore it or all the not as good outcomes. Done is better than perfect. And if he comes up with a done way to get it done, that's not your method. They're the way you would have done it, but hey, it's done and it's great. There needs to be no humility, no arrogance in that. You just need to be like, awesome job. I'm glad you figured it out on your own. That's wicked.
00:12:12
Speaker
It was a piece of advice somebody gave me 20 years ago, which is for you to have a growing, fulfilling, successful career, that's going to involve a job where you not only make decisions, but make decisions with an opinion. Yeah, geez. That's so hard to do even for me.
00:12:32
Speaker
Right. But if you have a new intern who comes and you are boxing up saga pens, and that intern's like, hey, John, I don't want to step on your toes because I'm new here, but there's actually a different type of foam that I've heard about that could look really interesting. It could solve this problem or whatever. I mean, tell me you wouldn't be floored. You would order a sample right now.
00:12:51
Speaker
Totally. We were talking about this a couple weeks ago, I think. It's up to the entrepreneur to make the decisions, to make the final, to make the call. But I will drink as much information as possible to be able to make that call. So I'm always trying to pull from different areas. And it is always valuable to have an opinion. Sometimes I just dismiss it. I'm like, sorry, that's not the
Learning and Personal Projects
00:13:15
Speaker
way we're going to go.
00:13:17
Speaker
That's not the way I want to do it, but oftentimes, it's like, huh, I didn't think about that. Right? Yeah. It's so funny. Well, I'm making this little part, an air gauge for measuring hole diameters. Oh, yeah. Cool. Ken has some of those at work. I want to make my own. No. No.
00:13:41
Speaker
Trust me, I'm doing a small part of it and a buddy of mine is going to do a lot of the work, all the electronics and everything. So when you say, trust me, I'm explicitly telling you, I absolutely do not trust you. You should not be doing this. You can buy them used for like two or three grand, I believe. They're like sun in, is it sun in the mix? Yeah. No, John.
00:14:01
Speaker
Anyway, too late. So I'm making this part. This is the little plug for it. And it was a really good project on the Swiss because it taught me some radial, how to operate the radial live tools. Hashtag I love lathe. Yeah, exactly. And I got stuck on a couple codes and like, how do I turn the spindle on properly and all that stuff.
00:14:26
Speaker
So he was good to get that nailed. And I'm making this part and it's got a through hole all the way through it. I showed it to Angelo and he goes, well, where's the air gonna go? And I said, well, it's gonna go this way and this way. Wait, that through hole is not supposed to be a through hole. It's supposed to be a blind hole. Oh man, I totally forgot about that.
00:14:43
Speaker
Oops. I was so quickly doing it and so into it that I didn't fully think through the design. It was good to have that outside perspective and not make like 10 parts that are perfect except for this one glaring defect. Yeah, that happens. Get that JD weld out, right? Yeah, exactly.
00:15:05
Speaker
No, but look, you and I are friends. And that's what makes this sometimes that makes this conversation. It's a theme we've come back to, which is, which is this is here, we're here to help each other, not just say nice things and pump each other up. And I do think you would benefit
Balancing Projects and Responsibilities
00:15:20
Speaker
from some. You need a boss, John, I need a boss. I'm not exempt from this stuff by any means, but
00:15:29
Speaker
You asked me something that I'll never forget probably three years ago. I'm pretty sure it was before we hit record on this conversation. And tell me to stop if you don't want me to keep sharing this. But you asked me, John, how do I make money?
00:15:45
Speaker
Remember this conversation? Yeah, yeah, yeah. And you are making money now. Again, I'm good for you. To say I'm proud of you is arrogant. Everyone is proud of you. What you've done is incredible. But you still need direction. You're still not immune to making mistakes. For sure. I'm not going to keep picking on the epoxy tile of the shop because it's just epoxy. You can do what you want. It's not that much money.
00:16:14
Speaker
you need somebody in your, I would humbly suggest somebody that you can share more information than we share, especially now that this is recorded financial information, details, growth, risks to understand that. And you need somebody to look, I don't care if you make, if you make an air gauge, you learn the way you got an upward person helping you a new intern of in some respects, that's all totally fine. But you have a habit of going off on tangents that are not true. You do.
00:16:40
Speaker
They take longer. You run the risk of crashing machines or distracting from what makes you money. And they don't make money.
00:16:46
Speaker
Yeah, and you can just go solve this problem with an air gauge that you eventually you're going to realize, oh, actually, we need to have a shop come in every year and calibrate our tools. And someone's going to show up and be like, I'm not calibrating this, this DIY or do we know thing? Go, you know, and maybe they will. I don't know. It's a good question. I guess they probably calibrate anything. You paid them to calibrate, but no. Yeah. And I, it's funny because these projects are fun and interesting and you do them too. And we, they, they're like our nature, right? So it's like, we're,
00:17:15
Speaker
I don't want to say we're falling back into old ways, but it's like addictive. It's fun. It's like, oh, I just got this little side project I'm going to bust out between stuff. But it's exciting in the beginning. And then halfway through it, when it starts to get hard, is when I start to realize how dumb of an idea this is.
00:17:36
Speaker
And I start to feel guilty about it. So sometimes I'll shelve it for a little bit, and I'll get back to work, and I'll make money, be productive, run a business. And then maybe I get that urge again a couple weeks later, and then I tickle away at it again. And then at the end, sometimes it's sometimes, oh man, sometimes it's very valuable. Some of my side projects control our company now in the way that they make parts.
00:18:04
Speaker
And I never know mid process if this is going to do that or not. In this example, I don't think it's going to change our world. But if I stopped doing side projects altogether, then I don't know, we'd miss some stuff. So it's hard to tell what.
00:18:19
Speaker
And John, you're right. If you stop having fun, what are we doing all this for? I mean, you and I are... You are gainfully employable regardless of what path you take at this point in your life, right? Even if you decided to shut down Crimson Foe Knives, which is, of course, not even something you ever think about, but we're all going to be okay. So you've
Scaling Business and Leadership Transitions
00:18:38
Speaker
got to have some fun. I'm not trying to take that away from you, but
00:18:41
Speaker
I don't know what your goals are something we don't talk about you know do you want to become the spider co you know with with literally cranking out and everyone says they're not going to introduce a value line but everybody does in the end you know the the hundred dollar crimson for something you need.
00:18:59
Speaker
And part of me sees your, as a part of me paints your, a picture of your company with an element that you've taken too much risk and you've proved me wrong because you're crushing it, but you do have a lot of debt and you have a lot of machine tools and you're making money, but I also want to make sure you're setting a money aside. And when I hear about projects like that, I'm like, do that, do that when you are, you know, do that when you're coming into work,
00:19:28
Speaker
Because you love to not because you actually have to. But when is that point in time? Like there's no magical like turn the switch. Oh, I don't have to be here anymore. It's evolution.
00:19:39
Speaker
Well, but if you, so if you look at the shops that I've toured and I'm going to make up a number, which I pretty comfortable with that are grossing revenue north of $5 million. So machine shops, production shops, uh, product based shops at that point, my host or the owner hasn't programmed a part or hit cycle start in over a year or more.
00:20:03
Speaker
And we can leave the conversation at that. I'm pretty sure both of us are a ways away from that. I'm not sure I ever want to get to that point, to be honest.
00:20:12
Speaker
But you don't, I don't think, have a path right now. And you don't necessarily need one. But you're still very much involved in that stuff. True. It's very true. Yep. And part of it, that's where my passion lies. But part of me definitely realizes the non-scalability of that. And we are scaling the business. And Eric and I both still control a large part of the technical side of things.
00:20:40
Speaker
Yeah. That's not as scalable as it needs to be. It's something that I think about a lot. There are companies where the founder, like yourself, actually brings in a CEO and you become the CMO, the chief machining officer. The CEO runs the business and it's awkward because you, as a scrimsbo, are ultimately skilled. You have hired your own boss.
00:21:04
Speaker
Right. So there's a give and take there that can work well or can be a short-term experiment. But I don't think you necessarily need or can justify that right now. But I do think it would help you
00:21:20
Speaker
some guy named Mitch, who's a Toronto-based entrepreneur who's really successful and doesn't fluff you up. He cuts through the BS and gives you good feedback. Somebody like that who can say, John, I know your numbers. I know what you did last quarter. I know your overhead. I know what you got on the projections. Cut this out. Every project you make like this is not, where are you on rasks? Whatever, make up the example. And you don't have to... Again, life's got to have some fun in it, but... Yeah. In a weird way, I do have that in
00:21:50
Speaker
Well, the closest people in my ears, Barry, Eric, and my wife Meg.
00:21:57
Speaker
who do try to keep me grounded with things like that, especially Eric, he'll be more direct with like, like you said, like, where are we on rasks? And sometimes I try to hide these small projects from him just because from the outside, they're not exciting. But to me, they're like really exciting. And maybe there's some weirdness in that. It's like I'm trying to hide projects from people.
00:22:21
Speaker
Like on the other hand, it's like my business, I'll do what I want. I commend your honesty right there. You're saying what we've all felt, which is sometimes you want to just kind of
00:22:32
Speaker
Just do, darn it. If I can't, if I own my business, I can't do it. Right. I hear you. I hear you. But on the other hand, there's eight people working in the shop right now. And they have a lot of responsibility to take care of everybody and make sure we have everything we need. And especially if there's something that is delayed because it's my fault and I'm dicking around with these stupid side projects, that's a problem. So I try very hardly to
00:23:00
Speaker
to not make that a problem. But yeah, it's a balance. Everything's a balance. Yeah. But kudos on the honesty and transparency, which is super crazy because this is a recorded conversation. Because the second that you and I start fibbing to each other to try to avoid being reprimanded, this podcast, we're shutting it down. Seriously, it's a worthless.
00:23:24
Speaker
But on that note, I've got to share my growth pain this week. Are you familiar with working capital? Very. Yeah, noted. Fair point.
Working Capital Challenges
00:23:37
Speaker
But every small business owner has a good working capital story as they've grown. And I think we hit ours this week, which is...
00:23:46
Speaker
Luckily, I kind of knew about it. So it wasn't a surprise, but it still frustrates and flabbergasts. But we've had like two extreme opposite things happening at the same time. We cut a for us, an abnormally large check for something on September 27th. This is November 13th that we are recording this month and a half later, like a check that most people would cash. They cashed it yesterday.
00:24:16
Speaker
Which is technically good for me because I got to keep the money in my bank account though. You've already earmarked it. You set it aside. You've got this many thousands of dollars, I'm sure, tied up in just the air, right?
00:24:33
Speaker
Well, so yeah, that's the thing. In the US, I think most business checking accounts don't or can't earn interest. So the fact that we got the money for some period of time isn't that relevant. But the other extreme is we have more receivables right now than we normally have. And for reasons I can't really explain, we're having a hard time tracking people down right now. And it's not a good use of my time. It's something that's very
00:24:59
Speaker
I think a very sympathetic frustration to a lot of business owners, which is pay your darn bills, people. My intrinsic personality is a very trustworthy person. People will pay their bills. It's okay. Everyone's good at the end of the day versus the New York John that's like, everyone is out to screw you. Everyone will look for a way to cut corners or not pay or squirm. You've got to stay on top of people. You've got to hustle. You've got to stay on them. I've made six phone calls this week for people being like, where is it? The excuses are incredible.
00:25:25
Speaker
That needs to be marked as urgent. Otherwise, we don't check our email. It's like, what are you talking about? No. Or people just dragging their feet with no excuses. And I got to call out schools. I am tired of schools and education systems being like, oh, we need you to conform to our purchasing process and we need you to conform to our systems and the way we do business. But we're not going to pay you for like 50 days, even though
00:25:51
Speaker
We accept your net 30 terms because our board doesn't meet until every six weeks and they need approval. It's like detached from reality. But that's on me. I got to figure that out or choose whether to do business or not. But what's weird is that we are owed a bunch of money. So Zero does a good job of showing you that, which is awesome. But it's still a shock when you are like, holy cow, that's a big swing.
00:26:17
Speaker
Okay, so you're owed a bunch of money and you have this, whatever you call it, outstanding payment that's not cashed yet. So that money is yours, but tied up because it's not yours. Exactly. Right. I don't think anybody balances checkbooks anymore because nobody uses checkbooks, but it's that example, right? Yeah, it's balancing your account. I mean, even though the money's in your account, you can't spend it because they could cash it at any time. Exactly. You have to pretend it's not there. Right. Yeah, I get that.
00:26:45
Speaker
This will only get worse. That's worse. That's true. That's true. Right. Yeah. Barry brings this stuff to my attention every now and then. He's like, they haven't cashed the rent check in like 60 days. Right? Who does that? Come on. Right? Yeah. Even the- I don't know. It's weird. It's funny. Like cash it. We had to have a structural engineer do a roof analysis for our HVAC unit this spring. He sent the invoice like four months later.
00:27:14
Speaker
I'm like, companies like Dell, if you go read their stories, they basically built their business off of arbitrage and working capital where they would... And I'm not agreeing with this. Oh yeah, they would demand payment.
00:27:28
Speaker
quick, and then they would pay everybody else on net 90, which I don't think is the right thing to do or how to treat people. But if you think about it, working capital is an incredibly powerful tool when you... Well, I'll give you an example. We have a form of working capital benefit from our training classes because folks usually sign up for them pretty far in advance, and then it doesn't cost me any money for those until the time of the class, basically. And I'm okay with that.
00:27:54
Speaker
It's helpful in a reasonable way, but different than trying to screw your suppliers over.
Vendor Payment Strategies
00:28:01
Speaker
Anyways. On the subject, if somebody gives you net 30 or net 60 terms, do you tend to push that or do you pay them as soon as you can?
00:28:14
Speaker
Uh, that's a good question. Um, we're getting a little bit more. So, so for a long time I had the approach of, but I would pay it right away for a few reasons. Number one, we don't earn any interest on our checking account. So there's no reason to like, I don't get a cash
00:28:30
Speaker
interest benefits, keeping the money. And for a while, it was helpful for us to grow because if we had problems, we could call our vendors and offer them, say like, hey, we pay you really quickly. I need help on this. And that goes a long way. Now, we do tend to look for folks that will give us like 1% 10 or 2% 10 net 30.
00:28:51
Speaker
you'll get a 1% or 2% discount for paying within that 10-day timeframe. That's pretty common. Usually, your vendors on material will only give you 0.5% net 10% because the margins are small. That's a crazy concept. I don't think any of our vendors do that. But if you pay on time, it'll cost you less. You're defaulting to saying that
00:29:14
Speaker
Nobody pays on time, so you should be rewarded for paying within 30 days after you receive the thing. It shows you the power of working capital, John.
00:29:28
Speaker
Um, on the little stuff I pay right away. Cause I don't care if I get $130 of which I just pay. Um, and you know, um, some stuff, uh, like it's actually funny. You asked this MSC doesn't give us any net benefit on our payment terms. So I actually just switched it back to our credit card. Um, because you can push the credit card a little bit and get points. We don't ever, we don't ever carry a balance on our credit card. Um, but at least on that point, do you, do you like,
00:29:59
Speaker
Do you pay it at the statement or do you pay it first of the month every month? I just do the auto pay sweep thing, so it just automatically handles it. Interesting. It clears your balance at the statement date when it comes out. I think it's technically a certain number of days after the statement date, but it literally is the default settings when you turn on auto bill pay for it.
00:30:24
Speaker
Interesting, but you still kind of, you're not carrying it, but if you buy something on the first of the month, you're not paying for it really until the 31st, you know what I mean? Absolutely, yeah, for sure. Yeah, so like Barry leverages this, so we never pay interest anymore, but yeah, he's, you know, pay for it in 30 days, or you know what I mean. Nothing wrong with that, especially for a credit card, because you're just that bank.
00:30:51
Speaker
Vendors are different. You should be able to get some vendors, I would think, to do some net. And look, tackle the largest vendor first because that's the best. Oh, we definitely do. We have net 30, the one or two are net 60. No, no, for really. I would do the one. So the net 60 guy. I don't know if I've seen that yet. It's a powerful thing. It's something we got to think more about. Yeah, absolutely.
00:31:17
Speaker
What's up today? What are you up to? Let's see, lots of stuff, lots of stuff. Back to production.
00:31:28
Speaker
I don't know. I can't think of anything right now. Oh yeah. Last night I heard back from the shop. Um, we are drawing up the paperwork right now. Awesome. Everything's looking good. Um, we came in what 10 or 15 under 10 or 15% under asking price and they took it. Um, so that's on the lease rate. Yeah. And the lease rate. Okay. Got it. And, uh, got a month free and good for you. Yeah. Some other stuff. What's the, how long's the lease term?
00:31:56
Speaker
Five years. Cool. What would be the perspective move-in date? January 01.
Business Expansion and Leasing
00:32:04
Speaker
A little bit later than I wanted, but realistically, like you said last week, stuff's going to take time. That's literally six weeks away. That's not far. Things are great. We're drawing a paperwork now, should be signing it this week, and then we're locked in golden. Awesome. Then we can make this happen.
Preview: Rigging Strategies and Machine Handling
00:32:25
Speaker
Love it. Next week, I got to run this morning. But next week, let's talk about rigging. I have some questions and lessons learned and rigging strategies for receiving machines, moving machines, and all that, which is going to be something on your agenda, I would guess, here. Very soon. Yeah. And I've got an interesting note on that with the current coming. So excellent. I got to run. Oh, and I'm in Vegas next week for AU. All email you will figure out a time. Sounds great. Awesome. Take care, bud. Have a great day. Bye.