Other ventures

[TKK]

Any of u guys sell your route and do something that wont cripple you by your mid 30s?

[orsd]

From your posts it sounds like you got a pretty big operation. Honestly, you could probably start thinking about moving to the office 100% making sales calls and managing. Will require some trusted competent supervisors though so it’s not the easiest. If you sell out you got a sizable chunk of change, you could invest it wisely.

[TKK]

Yeah ive been thinking of that, because i can easily double in size and cash out big since our machines are all 2 to 4 years old now. Theres value with all the contracts and ofcourse revenue etc. I just dont trust movers to move machines and employees mess up alot. 

[orsd]

21 hours ago, TKK said:

Yeah ive been thinking of that, because i can easily double in size and cash out big since our machines are all 2 to 4 years old now. Theres value with all the contracts and ofcourse revenue etc. I just dont trust movers to move machines and employees mess up alot. 

You have a personnel issue, and a management issue. When I say office work this is the kind of work you will be doing. 

If your employees aren’t worth a damn it’s YOUR job to train, and correct. If need be, fire them and hire new workers. (If I recall correctly, you said you paid your guys under 15/hr. That is part of the issue, bump that pay up to 20/hr and be as selective as you can. Make it clear that the extra pay comes with higher expectations. If they don’t perform, let them go. The economy is doing well and good employees are hrs to come by, and certainly not for cheap.) Also, play the long game. Look for the driver that cares, is through and methodical, and has common sense and leadership/ people skills. Train that guy to be a supervisor. Send him to school if need be.

[TKK]

Yeah i agree 2 of my employees have been with us for 2 years and they are good at what they do. Its just a few that lack common sence and no communication. Training is very time consuming for us can be 2 to 3 weeks of us running the routes which takes time from growth

[orsd]

Ok. So at this point if you are going to be in this for the long haul, you are going to want to pause the expansion for a bit. You need to take the time to set yourself up for future growth. Take your 2 trusted guys, give em a raise, and train them to become leaders. Take the 2 slackers and train them. If they still suck can them and pay more so you can hire guys that don’t suck. All this will save you time and money in the long run, cause you don’t have to babysit your guys, and frees up your time for big time expansion.

Edited September 19, 2019 by orsd

[AZVendor]

How much are you paying them and for how many hours per day?  Low pay gets low performers.

[TKK]

Here locally minimum wage is $7.25. Cost of living is pretty cheap. I pay these guys 20k a year salary. And they are off maybe 4 weeks a year. Usually they work 8 to 4 or 8 to 5ish. I was tired of clocking in and monitoring all that. I guess i need to invest in the right team, sucks because i could be growing alot more right now, but thats good advise. Anyone own any restaurants or flip homes?

[AZVendor]

So you're ripping them off.  If you were smart you would pay at least $15 per hour AND give them benefits.  You make money hand over fist, per your own admissions, and yet your employees are paid practically at the poverty level.  Regardless of your cost of living you will benefit from emplyees paid more than the median wage.  You get what you pay for and I speak from experience.  This will also improve your sale price if you sell and have a solid, well-paid staff to go with the business. 

 

[TKK]

No ones getting ripped off anything over 20k here locally is usually requiring a degree. 

[Southeast Treats]

20K is a little less than $10/ hr for full time, that might be OK for a trainee, but anyone decent will find better pay elsewhere after a while (or the not so decent will supplement their pay by ripping you off).   Base plus commission might work for you if you don't want to be hourly, and would also motivate the drivers to hustle some more.  Have your 2 year employees had real raises in the last 2 years?   Would you stay somewhere you were not advancing in pay and responsibility?  

You want to get a restaurant because you think it would be easier????!  A restaurant makes this job look like easy street!

[AZVendor]

Then the business owners in your area are the stupid ones that don't understand the economics of paying a living wage and providing benefits.

[TKK]

Azrandy lol simple economics. supply and demand. As far as the 2 yes they were at 15k then now at 20k plus bonuses which is another 300 a month or so

[AngryChris]

2 hours ago, AZVendor said:

Then the business owners in your area are the stupid ones that don't understand the economics of paying a living wage and providing benefits.

Let karma do its thing.

[orsd]

Maybe wages are that low in your area but you absolutely cannot get people who can show up on time, sober, who are legal to work in the US for 10/hr around here. Common sense (ie anyone I would trust with a company truck and with cash, ie a vending route driver) starts at 15/hr.

A quick Google shows wages in El Paso (I think that’s where you are) for a driver is avg. 11.50/hr. You are paying under market rates, therefore naturally you will only attract the bottom of the barrel. Locally, Chick-fil-a pays significantly over what it’s competitors do, and it definitely shows, in terms of service and employee quality. If you want to stop wasting time babysitting dumbasses, pay more and be more selective in hiring. This will only help you in the long run, as the time you save can be used for expansion.

Also, if a vending route is giving you this much trouble the restaurant business will kick your golpher. Just take your current personel issues and turn it up by 5x. Hell, it would kick mine too, which is why I refuse to get anywhere near it.

[orsd]

Also, you may get in trouble with the feds for paying your guys salary. There are rules as to if an employee can be paid salary, and your guys probably don’t  qualify. 

And yes, you absolutely need to invest in a quality team. You have new machines across the board, which tells me that you see the value in investing in quality. Do the same with your staff. Put it this way, 5/ hr raise across 5 guys is 50k/yr total. How much time do you waste per day holding their hands? I’d guess at least 2hr/day. I can’t imagine you couldn’t  land a bunch of new accounts using that 2hr/ day. Plus your current customers will get better service and will be more likely to stay with you.

[TKK]

Thanks for the tips. Now for the topic question, what else do u guys do? I feel like vending will diminish in time. Vendors are allowing low pricing bite themselves in the a$$.  Have u guys seen all the raises this year?

[AZVendor]

You aren't sitting idle on your pricing so what other vendors do isn't hurting you.  It sounds like you are in a slow economic market if the cost of living is low so you probably don't even need to worry much about how micro markets are killing vending locations.  If you're smart though, you should get heavy in micro markets yourself to be prepared for any competition.

[TKK]

I only have 1 but i need to grow into this as well

[orsd]

Might be worth transitioning to Micro Markets and then maybe stop n robs.

[flintflash]

TKK, get your drivers earning commission.  My route drivers earn 10% commission on their routes and trust me, it is worth it!  They are CONSTANTLY begging for more accounts, because they find the means and the time to do MORE.  My drivers on average are earning between $40,000 - $45,000/year.  On commission, you don't have to track overtime, and most of my drivers see maybe only 2-3 overtime hours/week at best.  AND to top it all off, my drivers are running HONOR SNACK routes!  My Full Line vend driver is earning over $50,000/year doing what your drivers are doing.  Listen to everyone and INVEST in GOOD PEOPLE!  The average years of my employees are 9 years with me (that includes my office staff, packers, sales reps and route drivers).  Most of my route drivers have been here 10+ years.  If you are the leading wage-setter in your market compared to your competition, believe me, you will have the best people working for you.  I've had Canteen drivers apply for work with us. 

[TKK]

Sweet! Love the tips on here! You give them 10% of sales?

[flintflash]

46 minutes ago, TKK said:

Sweet! Love the tips on here! You give them 10% of sales?

Yes sir!  By putting them on commission, they are now in control of their earnings as well as their work day.  If your pricing is done correctly and you manage your expenses, it should work.  A route driver has the incentive to do more and work more efficiently.  When they feel as if THEY have some "skin in the game", they treat the route as if it were their own business.  This works for BOTH my Honor Snack routes AND my Full Line Vending.  Route drivers are my LOWEST turnover positions.

[TKK]

Is it 10% plus a wage?  Right now wages account for 8 to 10% of our total gross. 

[flintflash]

10 minutes ago, TKK said:

Is it 10% plus a wage?  Right now wages account for 8 to 10% of our total gross. 

I pay them 10% of the Total Cash collected (minus credit card fees).  My Full Line Vending drivers average $1900 - $2000 daily.  Their goal is to service as many accounts as possible and collect as much money as they can, while maintaining high levels of service.  They take care of the customers well because they don't want to lose a customer, and as they get faster on their route, they look to add another account or two.  They are very much vested into their routes because they can impact their wages.  Employees that can see the immediate impact of their performance, especially in regards to their earnings, will give you a much stronger effort.  It's worked for me for 25 years.  Many of my competitors still pay hourly, and that is what they get: an employee who looks at their hours, not their work.  Their goal is to make the least amount of work last the most amount of time.  MY drivers think the opposite.  It's funny, but they actually talk to each other to let one another know of traffic accidents on the highways or construction slowdowns to help each other avoid them and reroute themselves.  I want them to think of "THEIR TIME IS MONEY".