Mike (2:35)

Yeah. Yes, sir. So they get one hour's wage almost every day.

Dave Ramsey (2:41)

So what is that?

Mike (2:42)

That ends up being, let's just say, 25 bucks a day, 125 bucks a week, little bit less than 5,000 a year.

Dave Ramsey (2:51)

Okay. All right. And that they're supposed to cover their fuel and the loss in value on Their car for the miles. Extra miles they're putting on it for 5,000 a year.

Mike (3:02)

That is correct.

Dave Ramsey (3:04)

It's probably costing them more than that.

Mike (3:07)

Okay.

Dave Ramsey (3:08)

Do we have any idea how many miles?

Mike (3:10)

Wow.

Dave Ramsey (3:12)

No, you never tracked.

Mike (3:13)

No, no. Yeah.

Dave Ramsey (3:15)

Yeah. Because that's the actual thing. If it's two miles a day, that's one thing. If it's 100 miles a day, it's another thing. Right?

Mike (3:22)

Yeah.

Dave Ramsey (3:23)

Let's think about it. If I'm using my car and I'm putting extra miles on it and that miles are substantial, it is causing the value of the car to go down. Agreed.

Mike (3:32)

That is correct.

Dave Ramsey (3:32)

If it's just the equivalent of having driven it to work and it's not much miles at all, then it's a break even. Then they're actually putting money in their pocket. If 5,000 buys enough gas to do the deal, which it should. So if they're not running many miles, it might be okay. If they're running a lot of miles, you're probably costing the employee money.

Mike (3:52)

Okay.

Dave Ramsey (3:52)

Does that make sense?

Mike (3:53)

It does. It does.

Dave Ramsey (3:55)

And then based on that, I'm gonna look at it, and I'm either going to increase what I'm paying them, and then I've got to compare that. So let's say right now you're $5,000 a year out of pocket on this. And let's say you doubled that and you were $10,000 a year out of pocket. Or you buy a used van to put their gear in for 20 grand in five years, it's worth five grand from the miles you put on it. And you got a company sign on the side of it, and you've got repairs and mileage on it, and you've got gas going into it. Is that going to cost you more than ten grand a year? Probably not much more than that. That's probably about what it is. So you could kind of run the numbers out and say, okay, if we bought a van and we run it this, and we, you know, you kind of take some educated guesses at the actual miles, and you say, all right, we're gonna buy a used van. We're gonna. A nice one, but used. And we're gonna put a company logo on the side of it like the competitors do, Right? And so I've got a rolling billboard that's helpful, but not really gonna make you much money. But then, okay, but it's 10 grand out of pocket. Now, the employee is not being inconvenienced. Now, the employee might like to be inconvenienced. If they're getting more money in than it's costing them. So I think you gotta figure out, are you really costing money? You gotta do a little bit more analysis than you and I did here on the phone. But, I mean, you're in Cincinnati, Ohio, so they're pretty well all over the greater Cincinnati area, I assume.

Mike (5:28)

Yes.

Dave Ramsey (5:29)

I kind of think you're costing them money.

Mike (5:32)

Okay, what about liability? I know you're not a lawyer, but.

Dave Ramsey (5:36)

No, no, thank God. And see, you and I are going to like each other yet. But anyway, but the. Anyway, the. Yeah, I. I don't think you're liable. They're using their car. It's their liability, their insurance and their liability. You know, there's been some stuff pop up in the old days, like if people are doing Uber or they're delivering Domino's Pizza, some personal insurance policies won't cover them while doing that.

Mike (6:07)

Yeah.

Dave Ramsey (6:08)

And so if they were doing company business, if they were doing commercial activity with a normal personal policy, not a business policy, some of those insurance companies have denied claims. If you're delivering pizza or doing Uber and had a wreck because you're making money, you're doing a commercial endeavor and you don't have a commercial insurance policy. So there's been some of that happen out there. I've seen some case studies, I've read on that kind of stuff. I've not heard of it being widespread in a long time, but I have heard about that. So obviously, if you put your truck on the road, yeah, you're liable, but your LLC that owns your company probably would own the truck. So that keeps your personal assets sheltered, which is why you have an LLC on your company. But I don't know about liability with the employees driving their own. I'm more concerned that the guy mentioning it coming in, he doesn't set policy. We said that. But he might be doing a little math and going, okay, I took this job, I got a raise, but I'm also gonna lose a little money over here. But I still wanted the job anyway. And he kind of did the analysis that you and I just did, possibly. And so I don't want it to be costing you talent. And I kind of like your tools, all the tool costs you have being in your truck, because tools, they grow legs, as you know, and they might grow more legs if they were in someone's personal vehicle than if they were in my truck. So that's a consideration as well. What's the tool budget on these things and does that change if you shift to company vans. So I don't know. It doesn't sound like it's egregious either way, but I think I would do. Since you're asking about it, I think I'd dig. I'd get down in the weeds a little bit. Let's do a little bit of actual math and try to. Try to estimate what we're really costing the employee. If they're driving a $20,000 car and they put an extra 10,000 miles a year on the car, what does that devalue the car? What's their gas bill on that? What's their oil change on that? Throw a few dollars in there for some extra repairs that they wouldn't have without the extra miles, and then let's see if that's 5,000 bucks. I got a feeling it's more than that. So I got a feeling they're not making money on this. They're probably losing money on this. Sometimes people driving Uber, by the way, are losing money while they're driving Uber because they're taking a $52,000 car and running miles up on it, and they haven't thought about what they're doing to the value of that car while they give somebody a $37.46 ride. This is the Entree podcast. Hey, business owners. Today is the last day to grab more than $350 in bonuses when you pre order. Cause it's the last day of pre order for the new book, build a business you love. In this book, we teach you how to master the five stages of business. Business is hard, and we're gonna give you the clear path to work through the five stages and the six drivers that'll help you move through the five stages. This is kind of your baby steps for small businesses. Build a business you love. It's the essential guide to help you grow yourself, lead your team. Once the book launches to the public tomorrow, April 15, the extra bonuses, the extra audio books and ebooks, the lesson on hiring and firing, that $350 worth of goodies is going to go away. So right this second, sit down and order the book@ramseysolutions.com or you can go to entreeleadership.com pre order. Chris is in Huntsville. Hey, Chris. Welcome to the Entree podcast.

Chris (9:54)

What's shaking, Dave? How you doing, man?

Dave Ramsey (9:56)

Pushing it through, brother. How can we help?

Chris (9:58)

Well, I'm a general manager at a H VAC service company. We currently have 17 employees, and we did 4.3 million last year.

Dave Ramsey (10:06)

Wow.

Chris (10:07)

And I wanted to Know what is the typical process for buying into or becoming a partner of the company that I currently manage but don't own?

Dave Ramsey (10:19)

Well, I mean, there's a bazillion ways to do it. There's a lot of reasons not to do it. I often say the only ship that won't sail is a partnership. I will tell you, managing and leading and teaching small business folks for the last 20 years, the number of small business partnerships that survive a decade is. I can count them on one hand. They just don't happen for a lot of different reasons. A bazillion different reasons. But the only exception to that are, like, medical, a bunch of docs. Bill, to do a partnership, that's a standard thing. It's a different type of deal, or a bunch of lawyers do a thing. But it's situations like you're in. The problem, Chris, is unless you buy or get somehow 51% ownership, you have put money into something you have absolutely no control over.

Chris (11:16)

Right.

Dave Ramsey (11:18)

If you have a 26%, we call that a minority interest. The other person that owns the other thing can do whatever they want, and you just have to accept it. So they could not work much, run the thing into the dirt, borrow a bunch of money, buy a huge piece of equipment that you know as the general manager is a bad idea, but they want to buy it anyway. And all of that affects profitability. It all affects the value of what you now own. And if you paid money to be a minority partner and you don't have a vote, and all of a sudden that money is worth nothing because they screw up the deal, they screw up running the business, and people do that pretty regularly. So a minority partnership is a very, very dangerous investment because you have absolutely. You can't get out of it. There's nobody to sell it to, nobody wants it. And the other party could choose to misbehave. Or let me tell you another thing that happens. They could die. And now you work with their spouse, and the spouse chooses to do. The old boy you did the deal with was fine, but he's married to a crazy woman. And she comes in and decides she's gonna run the thing in the dirt. I've seen that, like, a bunch of times. Or vice versa. The gal you did the deal with, she was solid and her husband's a doofus, and she dies. And he comes in, takes it over, or they go through a divorce. Now they both own 26% and you own 26%. And now they're fighting all the time in there. And you can't run the business. Cause these idiots are in there. And you know, you get into all that kind of stuff. Can you tell? I've seen it before.

Chris (13:00)

I can't. It's really clear. Yes, sir.

Dave Ramsey (13:02)

Yeah, I'm trying to. I'm trying to dissuade you from wanting to do it. So is the owner offering you this?

Chris (13:09)

Yes, he has. And he's kind of left an open table discussion. And I really love working with this guy. I've worked with him for. It's almost 14 years now.

Dave Ramsey (13:18)

And where does this lead 10 years from now? Do you end up owning the whole thing later?

Mike (13:25)

No.

Chris (13:25)

He has made it clear that he would never give up, like a majority ownership.

Dave Ramsey (13:29)

Yeah. So you're going to be a minority position no matter what you do.

Chris (13:33)

Yep, exactly.

Dave Ramsey (13:34)

So the reason for you buying into this is to participate in profits mainly, right?

Chris (13:40)

Yep, that's true. And he's. He actually offered me something this year. In lieu of like me buying in or giving. Being given shares or earning shares, he's offered me a profit sharing program where I would get essentially the benefits of ownership without buying into the company.

Dave Ramsey (13:58)

That's the one I want. I want that one.

Chris (14:01)

Okay.

Dave Ramsey (14:02)

Yeah. He just starts paying you off the bottom line as if you're a partner. So my operating board that operates Ramsey, I move them into that role and that functions like we call it. It's like a law firm. Like, you made partner. And if you, an operating board member, you are now paid a percentage of profits of Ramsey Solutions off of the same bottom line that I get paid off of. You don't pay anything for that option or that. Right. You're not a legal partner, but you are paid a percentage of what this place makes as your compensation. And as a matter of fact, with our operating board, I'm probably not the case in your thing, and it probably shouldn't be in your thing, but with our operating board, it's the only money they make. They don't have a salary. The only money they make is whatever our profits are that month. We have a percentage each person gets and a percentage I get. And we just divvy up the profits from the closing of the books the month before. And that's how they get paid. And so they treat this place like an owner, which is what he's trying to create here. He wants you to be vested. He wants you to be bought in, want you to be very concerned about expenses and revenue, which is exactly what I want with those operating board members. And they not only run their area, but they're looking at the whole place like a part gardener would, because they want the whole place to make money because that's where they get paid. And I love that model. And if he's offering you that, I think that's a deal for you. Yep.

Chris (15:32)

I mean, it sounded like a kind of a sweetheart thing to me, but again, I'm really ignorant in this arena.

Dave Ramsey (15:38)

Yeah. But yeah, I think it's a great deal if. And my guess is he's probably offering you your salary plus a small percentage of profits to participate off that bottom line. And so all this is is a raise, and it's him saying, I value you being my general manager. You're my right hand guy. You and me are doing this together. And so I'm gonna treat you like you're a partner, but you don't have to pay for it. And if we break up, it's not messy.

Chris (16:08)

You know, it's funny, he almost said that verbatim.

Dave Ramsey (16:11)

Good.

Chris (16:11)

No joke.

Dave Ramsey (16:12)

Okay. Yeah, I think this is a good guy. He's not the one I worry about. It's when things go sideways and you end up having to deal with somebod that I get worried. But see, if one of my operating board members leaves, they don't get anything. They don't own anything. They just quit. They quit their job. And that's the same with you here. So if you decide you wanted to go out on your own or you wanted to go work for somebody else, or he fires you for misbehavior of some kind, you don't have to untangle the ownership. So it's really nice, it's really clean. Chris. That's what you should do. That's the direction you should go. Right there. I'd sit back down with him and say, I get what you're trying to do. I want to be emotionally invested in this as if I was an owner. You pay me something off the bottom line to make me smile, and I will make you smile by leaning into this as if you and I are actual legal partners, even though we're not, but I'm still sharing off the bottom line. I love that you get to eat what you kill. It's a good thing. This is the Entree podcast. I've been running a business for over 30 years, and technology has changed a lot. Now the hot topic is AI. And I understand it might be intimidating, but like a lot of other tech that took some getting used to, AI is just a tool that help us work faster and smarter. So you'd better get on board, otherwise you're gonna get left behind. NetSuite by Oracle offers AI powered tools that help small businesses improve efficiency and make smarter decisions by bringing all major business processes into one platform. With one unified business management suite. There's one source of truth for the real time data you need to take advantage of opportunities. Then you can forecast better, scale more efficiently, and streamline manual tasks that take too many resources away from what your business actually does. So join the more than 41,000 businesses, including Ramsey Solutions. The Trust NetSuite to help tackle some of their biggest challenges. And right now, you can download the CFO's guide to AI and machine learning at netsuite.com Ramsey it's free at netsuite.com Ramsey this is the Entree Leadership Podcast. I'm your host, Dave Ramsey. Thanks for being with us. If you're looking for theory, you're in the wrong place. This is stuff I do every day. I run a business with about 1100 team members, about 300 million in revenue, and I grew it from a card table in my living room in the last 30 plus years. So, I mean, our team here is incredible. We have incredible leadership team. We deal with the same hiring and firing stuff you guys deal with. We deal with the same enemies that come at us like you do. We deal with the same scrappy, scrappy, scrappy, I gotta make something happen every day attitude that you guys do. This is not a professor who's never made payroll. I made payroll last Friday, baby. So this is how this works. We're here to help you understand that this is practical, hands on stuff. That's what the Entree Leadership Podcast is. If you want to discuss leadership theory, you need to go somewhere else because I can't help you with that. I can help you with that, but I don't want to. It's not what I do. So the phone number if you want to participate, is 844-9441-084494-41070. Jenna is in Atlanta. Hi, Jenna. Welcome to the Entree Podcast.

Jenna (19:54)

Hi, Dave. I own a crane repair company. We have about seven employees and we're bringing in a little under a million a year. However, we've been struggling with cash flow because we have around $200,000 in vendor debt. What would be the best way to attack this while keeping the business running?

Dave Ramsey (20:19)

Train repair. As in locomotives?

Jenna (20:23)

No, like construction cranes.

Dave Ramsey (20:25)

Oh, crane, crane. I'm a little deaf. I'm sorry. Okay. Crane repair. Okay. But people aren't paying you on time. You said you have a cash flow problem. Why?

Jenna (20:39)

We're. It's going through the winter months and everything. It's definitely slowed down.

Dave Ramsey (20:46)

And that's different than somebody not paying you on time, Correct? Business is down.

Jenna (20:52)

Yes. And it's. Businesses down. And then we've branched off and started doing business for the government. And they're definitely. Their net terms are a little bit long.

Dave Ramsey (21:08)

What's long? Tell me how long.

Jenna (21:11)

45 days.

Dave Ramsey (21:12)

Okay. That's not too bad.

Jenna (21:15)

Typically with us, we are due upon receipts.

Dave Ramsey (21:18)

Yeah, but I mean, if you get your money 45 days later and you paid your vendor for that job within that 45 days, they're not pissed.

Jenna (21:26)

Correct. And this is also the vendor debt that I have is from 2023 when my master technician, he had a accident and fell from a crane so that, you know, hit the business really hard.

Dave Ramsey (21:44)

And why does that create. That's a horrible thing. But why does that create vendor debt? I don't understand.

Jenna (21:49)

Because of all of the vendor bills that I had that I was on net 30 terms with them, I have not been able to, you know, I wasn't able to pay those vendors back in a timely manner. And now I am.

Dave Ramsey (22:06)

Okay, so you had one technician, and so all revenue stopped.

Jenna (22:11)

I mean, pretty close to it. Yes. I mean, we went from making 60 to 80,000amonth to about 15 to 20.

Dave Ramsey (22:20)

Okay, because this one guy was your. He was your cash cow and got hurt.

Jenna (22:25)

Yes. I mean, because we also. We only have two technicians that actually go out and work.

Dave Ramsey (22:32)

And that's still the case.

Jenna (22:34)

That is still the case.

Dave Ramsey (22:35)

Okay. And. But this 200,000 is old debt.

Jenna (22:41)

It is old debt. Correct.

Dave Ramsey (22:42)

Okay. If you use a vendor service today, you would pay them within 30 or 45 days, right?

Jenna (22:49)

We pay them immediately now.

Dave Ramsey (22:51)

Yeah. Well, I mean, not on the government jobs because you don't have the money.

Jenna (22:55)

Correct? That is true.

Dave Ramsey (22:56)

So within 45 days on the government jobs and immediately otherwise.

Jenna (23:00)

Correct.

Dave Ramsey (23:01)

Okay, so you don't really have a cash flow problem. You have an old debt that's hovering from an accident that happened and cut cash flow down temporarily two years ago.

Jenna (23:11)

Okay. Yes.

Dave Ramsey (23:12)

Is that correct?

Jenna (23:13)

That is correct.

Dave Ramsey (23:14)

Okay, I'm trying to make sure I got a full picture here. Okay. So are you still using any of the vendors that you owe 200k to?

Jenna (23:22)

A couple of them, yes.

Dave Ramsey (23:24)

Okay. Okay. I think I'm going to take the 200,000 and put it into two different buckets.

Jenna (23:30)

Okay.

Dave Ramsey (23:31)

Bucket one is vendors I still work with. Bucket two is vendors I Don't work with anymore.

Jenna (23:36)

Okay.

Dave Ramsey (23:37)

For whatever reason. The ones I don't work with anymore. What portion of the 200,000 would you say that is?

Jenna (23:45)

I would say that's probably a good $60,000 worth.

Dave Ramsey (23:51)

Okay, so 140. You're still working with 60's old debt that you don't have a relationship with much anymore.

Jenna (23:57)

Correct.

Dave Ramsey (23:58)

Okay. All right. I'm going to handle them differently because I need to keep doing business with the 140. I don't have to with the 60. Agreed?

Jenna (24:07)

Agreed.

Dave Ramsey (24:08)

Okay, so with the 60, how many different bills are there? Are those all. Is it six $10,000 bills, or are they all $500 bills? What's that look like?

Jenna (24:19)

I've got one at 28,000, another one at 26,000.

Dave Ramsey (24:24)

Oh, so two of them are. Most of it?

Jenna (24:27)

Yes.

Dave Ramsey (24:28)

Okay, that's good. I like that. All right, so what I'm going to do is I'm going to put. Do you have $10,000?

Jenna (24:35)

Yes.

Dave Ramsey (24:36)

Okay. I'm gonna call one of the 26, $28,000 guys and go. Guys, it's been two years. We're still trying to recover. That guy fell off that crane. It threw everything off. You know the story. I don't have the money to pay you right now, and I'm trying to clear out from under a total of 200,000. You're 26 of it. Tell them the truth. Okay.

Jenna (24:57)

Yeah.

Dave Ramsey (24:57)

And when. If I'm on the other side of that. If you're on the other side of that and you're hearing this and you go, I haven't gotten my money in two years, and this lady's backed into a corner here, and she's calling me and being honest and telling me, this is what I'm thinking. If somebody calls me with, this isn't what you would think.

Jenna (25:13)

Yes, it would be.

Dave Ramsey (25:14)

Yeah. And I want you to offer him 10 grand to settle that. 28.

Jenna (25:18)

Okay.

Dave Ramsey (25:18)

Would you take 10,000 to make this go away? If you can, I can do that today. I can't do the 28 today. But if you want to settle it for 10 grand, I can do that right now, and you and I will call it a day. And I'm really sorry. I hate that this happened this way. And if they go, screw you, I want my 28, you say, okay, I understand. It's going to be a little while before I can get back to you on that to take my 10 grand over to the other guy, and I'm gonna make the same phone call to him right okay. And just let them sit if they don't take the deal. But if they take the deal and you can clean. If you can clean up the 60 for 22 tens, I'm doing that. And now I got it all the way down to 140. Does that make sense? You know what to do there, right?

Jenna (25:57)

Yeah, that definitely makes sense.

Dave Ramsey (25:59)

Now get it in writing.

Jenna (26:01)

Okay.

Dave Ramsey (26:01)

That they're willing to accept $10,000. It can be an email. It doesn't have to be anything super formal. But, hey, just to close the conversation as, yes, I'll do. Here's my email address, if you didn't already have it. I want you to send me an email that says that, and I'll have our accountant wire the money over to you. This says that you will accept $10,000 of settlement in full on this debt and that I don't owe you anything when I send you ten grand. If you send me an email that says that, I'll send you ten grand by wire the chef name for my accountant. Okay. Now, you keep that file. You keep that email. Print it out. Keep a hard copy in case digital fails you, and you keep the digital file as well, forever, in case somebody over at that other place forgets the deal.

Jenna (26:41)

Right.

Dave Ramsey (26:41)

Okay. And now we got the 60 cleared. If we can pull that off, it might take a couple phone calls. It might be a little gyration. They might have to vent and tell you how ugly you are or something. But that's okay. It's okay. We'll just have the conversation, and then we're going to try to do a deal. Now, the 140. How many different vendors are there?

Jenna (27:01)

There's probably. I'd say at least 10.

Dave Ramsey (27:04)

Okay. All right.

Jenna (27:05)

They're all little ones.

Dave Ramsey (27:07)

And what's. So they're all five, ten thousand bucks?

Jenna (27:10)

Correct.

Dave Ramsey (27:11)

Okay. All right, that's good. I'm going. And you're already. You're continuing to do business with every one of those, correct?

Jenna (27:21)

Yes.

Dave Ramsey (27:21)

Okay. All I'm going to do there is every time I do something with them right now, I'm going to add 25% to it to be applied to the bill.

Jenna (27:30)

Okay.

Dave Ramsey (27:31)

And so if you have. If you get a new bill for 10,000 bucks from them on a current thing that you did last week, I'm gonna pay 10,000, and I'm also gonna send them another 2,500. I'm making that number up. It could be 10%. It could be 25%. It could be 35%. I don't care. But add Something to it. Two separate checks. Check one is for our current deal that I owe you today. And check two is to the past deal.

Jenna (27:57)

Okay.

Dave Ramsey (27:58)

Now, again, I'm trying to walk a mile in the other guy's moccasins. Cause if I think about how business ethics tells me how I want to be treated, if I switch sides, treat other people like you won't be treated. Right. The golden rule. Jesus said. Okay, so if I'm on the other side of this and I've got 15,000 bucks out with you, but you're still doing business with me, and I start seeing a check come in every so often, towards that, I'm gonna have a ton of patience.

Jenna (28:25)

Okay. Yeah.

Dave Ramsey (28:26)

But if I see nothing for two years, I'm gonna start wondering about Jenna. I'm thinking I might need to call her and work something out. And I'd rather Jenna just start sending me some money. And you're gonna pay those guys 100 cents on the dollar. There's no deal here. But we're just gonna pay them a little bit at a time, not all at once.

Jenna (28:45)

Okay.

Dave Ramsey (28:45)

Cause you don't have 140 laying around. Out of a million, I'm sure.

Jenna (28:49)

No, I've actually even thought about even. Did I need to do, like, a, you know, a HELOC loan on the house?

Dave Ramsey (28:56)

Nope, nope, nope. Vendor debt's better than HELOC debt.

Jenna (29:01)

Okay.

Dave Ramsey (29:01)

Because if you get in trouble, you can always call them up and do the same thing with them and try to give them pennies on the dollar. But I hate to do that on an existing, ongoing relationship, don't you?

Jenna (29:11)

Exactly. That's been my biggest thing is I, you know, I purchased those parts, I've used those parts. I made money off those parts. They are due this money.

Dave Ramsey (29:19)

Yeah, well, everybody's due the money. And. Or. And the whole thing. Nobody ripped you off. It was just you had a bad situation, and so now we're trying to clear it up. So I've got people that owe me money from 30 years ago, 20 years ago, 10 years ago. If they call me up and offer me anything, I'd take it.

Jenna (29:37)

Makes sense.

Dave Ramsey (29:38)

You know, you would too. It's found money. Cause I don't think it's coming.

Jenna (29:42)

Exactly.

Dave Ramsey (29:43)

And that's bucket one for you. Bucket two is you're just gonna start plinking at it, and they're gonna be smiling. Cause Jenna's trying.

Jenna (29:50)

Okay, that definitely makes a lot more sense now.

Dave Ramsey (29:54)

Yeah. And so I think it's probably gonna, you know, you clear up the 60,000 with two 10,000 doll. So let's hope we do that, you know, within three or four months. And then you think, okay, I got 140. I'm gonna plink at it. That's probably two years it takes to clear that. Okay, that's 70 a year in addition to the other business you're doing. I think you can handle that.

Jenna (30:17)

Okay.

Dave Ramsey (30:18)

But at least we're doing something. We're moving that way. Everybody's patient and everybody gets paid eventually. And eventually they go, well, it took her a while, but she made me whole.

Jenna (30:27)

Right?

Dave Ramsey (30:28)

And that's where you want to be reputation wise. You want to have done the right thing. And if they call you and say, hey, thanks for this, we appreciate it, you say, I'm going to keep doing this. If you'd rather do some kind of deal and let me just. And give me a discount, I'll try to scratch up the cash and knock the whole thing out. If you give me a discount, I'd offer them that. But I wouldn't push that on the ongoing relationship bucket, the one where there's no ongoing relationship. I'm gonna push the discount and try to get that deal done. So, hey, good, good question. I love where your heart is. I love that you're fighting and scrapping your way through this. You're the kind of people that give people jobs in America. You're the backbone of this country. You're a hero. I appreciate you calling in. This is the Entre podcast. Does leading your team feel like herding cats? Even if your business is winning financially, a misaligned team will create new fires for you to put out every week. But with Entree Leadership Elite, you'll align your team and hold them accountable so you can stop herding cats and start scaling your business. To join elite, go to entreeleadership.com elite or just click the link in the description if you're listening on YouTube or podcast. Hey, you can always submit your questions here@entreeleadership.com Ask, call the phone number and we'll work it out for you to be on the show. You can do that too at 844-944-1070. Dustin is with us in San Antonio, Texas. Hey, Dustin. Welcome to the Entree podcast.

Dustin (32:08)

Hey, Dave. How are you today, sir?

Dave Ramsey (32:10)

Better than I deserve. What's up?

Dustin (32:12)

Hey, man. Right now, I'm currently in the process of taking over our oil field service company for my dad. We've been in business for 25 years or so. Revenue is down to about 100,000amonth, roughly about a million a year. I have about 12 employees that I'm keeping currently. We're in a high stress environment where we're 24 hours a day, seven days a week, you know, 365 days a year where we're running services. And my dilemma is, is the workforce and how to hire, you know, the right type of people that can do that type of work without right now running into insurance costs and, you know, a lot of safety issues and we're having to work around and doesn't seem to be a lot of blue collar hands out there these days. So I'm trying to scale up and take over this company from old, you know, 20 year old ways and bring it into, you know, modern times. And I just figured I'd reach out to y'all and see if I could get some advice.

Dave Ramsey (33:21)

Okay, so we're solving for hiring people to do the job. How can I best serve you?

Dustin (33:31)

What I am is I'm changing over right now. The main dilemma I have is I'm leading the company like it's been handed over to me without any of the paperwork and all the corporate. We're sub s and we're, you know, all that stuff has to be changed over for me to have any real control over the company.

Dave Ramsey (33:52)

As when is that going to happen?

Dustin (33:54)

That's the thing. My dad is 74 and how old are you? I am 44.

Dave Ramsey (34:01)

Okay, so he has, he has said that's what's occurring. Is he working day to day in the business anymore?

Dustin (34:07)

No, he hasn't been for. Since COVID Since before. COVID is. Whenever we changed over such a downfall. We had a decision, you know, and I've decided to take the company and pick it back up and run with it.

Dave Ramsey (34:20)

Okay, so why is the paperwork not done?

Dustin (34:25)

Probably familiar, you know, family, there's wives, stepmothers had brothers.

Dave Ramsey (34:33)

They own stock?

Dustin (34:35)

No, nobody does. My dad is 100% owner.

Dave Ramsey (34:38)

So why is your dad not signed the paperwork over to you? Everybody else is telling him not to.

Dustin (34:45)

No.

Dave Ramsey (34:46)

So what stepbrothers and mothers and all those people got to do with it?

Dustin (34:50)

He, you know, relinquishing, you know, I know he, he trusts that. I guess in a sense it's, you know, that's a good question. There really isn't a. Yeah, I think.

Dave Ramsey (35:04)

You go to coffee with him this week.

Dustin (35:06)

I drink coffee with him every morning.

Dave Ramsey (35:08)

Good. Dad, I love you and I think what you built here is incredible. I am losing patience with the paperwork. We need it to be done this month.

Dustin (35:18)

Yeah.

Dave Ramsey (35:19)

If you're going to turn this over to me and you said you are and you've given me all the responsibility, I need the paperwork done and the corporate and the checking account and all that put into my name this month.

Dustin (35:29)

Yeah, I mean all that, you know, I'm able to sign on the accounts and I'm operating.

Dave Ramsey (35:33)

He needs to put it in your name this month, Dustin.

Dustin (35:36)

Yes, sir. That's what, that's what everybody's told me before. I end up in a bad situation. Yeah.

Dave Ramsey (35:41)

He's gonna die and you're gonna be screwed.

Dustin (35:43)

Yeah, exactly.

Dave Ramsey (35:45)

That's what everybody dies. And if you don't have this handed over before everybody dies, you're gonna be in a mess. All it is is he has this one last little thing of. He doesn't wanna relinquish the power. He has enjoyed running the business and he has enjoyed owning the business in general. And he's gonna kill it. And he's gonna do harm to his own son, who he loves, and he's gonna kill the business that he loves by not doing business well. And he needs to turn this over now.

Dustin (36:18)

Yeah, before it's too late.

Dave Ramsey (36:20)

Summer is too late now.

Dustin (36:22)

I agree.

Dave Ramsey (36:23)

Okay, so that's the first thing. Now the paperwork is now in your name. Now what's the next thing we need to work on? You need to be work on hiring because blue collar, there's a shortage of people that want to work like work that dad gum hard.

Dustin (36:38)

Right, right. I mean we work tough and we're dirty and there's not a lot of. I mean, it's hard.

Dave Ramsey (36:43)

What's a guy doing this kind of work make when they work for you?

Dustin (36:48)

My Top pay is 28 an hour with a average of 60 to 100 hours a week.

Dave Ramsey (36:53)

Is that enough?

Dustin (36:55)

I would. Because of it ebbs and flows. You know, I would like it to be more of a salary, but it. No, it's not. It really isn't. Those guys deserve to make way.

Dave Ramsey (37:07)

Well, I mean, is that, is it, Is that enough to attract people?

Dustin (37:11)

Yes.

Dave Ramsey (37:12)

To a hard job that you work 60 hours a week in the dirt? I don't know if that's enough to attract people to do that. Is it?

Dustin (37:18)

Hell yeah. Certain types. And I'm in a rural, you know, I'm in rural area in South Texas. Okay.

Dave Ramsey (37:25)

Not, you know, I don't know the answer. I'm asking. I'm not, I'm not, I'm not.

Dustin (37:29)

I've I've got, you know, I've got my eye out On. On the right types, you know, but for the most part, it's the ups and downs of the industry we're in that. That doesn't attract people because of the. The turnover, you know, every six months seems like. Or every five years, I would say the oil field is going through a downturn and people lose it, and then you got to rehire back and retrain from green. You. What I run into is my most veteran people, they have so much control and knowledge. I guess you'd say that you end up wanting to turn over more and it ends up affecting profits. And I guess that's. Overall where I'm at is my salaries are too high compared to what I'm able to charge. And the profit margins where they used to be 30, 40% are now 10 to 5 to 10% if we can squeeze them out.

Dave Ramsey (38:28)

Yeah, but does that change if things heat back up in the oil field? No pun intended.

Dustin (38:33)

I think it's. I think that's why I'm calling is because I anticipate it to start heating back.

Dave Ramsey (38:38)

Yeah. I mean, if Trump says drill, baby, drill, and they actually do, does that not affect you?

Mike (38:43)

I'm.

Dustin (38:43)

I'm hoping it doesn't. Volume. Now, they all still. The pay rate is about $200 an hour is what I'm running into, and I need it to be about 300 or 350. And I have a customer base that I'm afraid to raise pricing on because I have my bread and butter, you know, and. And that's an issue I'm running into, too, is being able to price accordingly to the.

Dave Ramsey (39:05)

How many customers do you have in the customer base?

Dustin (39:09)

I'm on probably a thousand master service agreements, but there's like 50 rigs, 50 oil companies, I would say, operating in our area, in our immediate work area. And what I'm trying to do is expand into, like, West Texas.

Dave Ramsey (39:23)

But, I mean, how many do you have.

Dustin (39:27)

Roughly, out of the 50? I'm probably doing 20% of the. Of the comp. Of the companies that are out there.

Dave Ramsey (39:34)

So 10.

Dustin (39:35)

Say there's 10 comp. Yeah, exactly. I'm probably working consistently for about 10 companies.

Dave Ramsey (39:40)

Yes. I'd pick two of them and go up on my price.

Dustin (39:44)

Okay, okay.

Dave Ramsey (39:45)

The two that you. The two that if you lost them, you really wouldn't cry a lot.

Dustin (39:49)

Okay. Okay. Yeah.

Dave Ramsey (39:50)

And let's start inching our way into this, and then I'm gonna start trying to figure out a way to pay the guys so that I can attract them. I don't know anything about that world other than looking in from the outside and, you know, lies that I've seen on movies which mean nothing. Right. So I don't know what I'm talking about. But the. I do know it's hard work and it's dangerous work, and it's. It takes a certain kind of. A certain breed to get out there in the cold and the heat and do this stuff. So I get that, and I admire that kind of hard work, that work ethic. It's a good thing. So I think I would practice making these guys the heroes in the story.

Dustin (40:30)

I agree.

Dave Ramsey (40:31)

I'd remind them pretty regularly that they're. That they're manly men, that they're a rare breed, that they get stuff done that nobody else in America knows how to do and that is willing to do. And occasionally just roll a food truck up and feed them and their kids at the ballpark or something. Occasionally buy my tickets to the San Antonio basketball team and see, let's do some stuff like that and just celebrate the men and their families a little bit for being the real frontier out there. And that's not money, but it says you have dignity. It says, we appreciate you. It says we think you're cool. And when you do that kind of stuff, some of that's better than. The reason I was asking if you were paying enough is I had a shortage of tech people here on the digital side at one point, and I was making the statement incorrectly for a while several years ago that there's a shortage. It's hard to find good people in this Tech X world, this certain position I was trying to fill. And what I figured out was it's not hard to find them at all. If you pay them, they line up. And so we weren't paying is why we couldn't find them. And I didn't realize that at the time. I didn't know it, but it was an easy solution for me. Once we figured that out, we went, okay, if we pay them X, we can't make money on them. So we need to quit whining about not getting them because we can't pay them X. We don't have the money. Or we need to pay them X and shut up and get them in here and get the work done. One of the two. And you could be facing the same thing. I don't know. That's why I brought that up. Are you paying enough? But that's what I would do. So I'd get the business, get into your name as soon as possible. I'd raise prices on two of my 10 clients to begin the gradual process of adjusting prices to the modern world cause they hadn't been raised in years in your situation. And I'd start celebrating the heroes that work for you in ways other than and in addition to their paycheck. And that's my three suggestions for your situation. I hope some of that helps you. Good stuff guy. Well done man. I love it. Very, very cool. Hey folks, remember, better a weary warrior than a quivering critic. This world needs more high quality leaders. Take courage and lead. I'm Dave Ramsey, your host. Thanks for listening to the Entree Leadership Podcast.