Hate to say it, but the 4.8is may have to go. - Page 2

Ricky Bobby · #1 08-20-2013, 09:01 AM

GL man, looks like Shark Tank is inspiring us all to follow our "American Dream"!

That machine shop of your dads, isn't that the family business though? Are you just gonna up and leave it? I would think if anything you'd just straight up hustle to make the family business thrive again, maybe then you can take home that paycheck!

TwinTurboGTR · #2 08-20-2013, 09:29 AM

Haha, yeah I guess so. But those people come in without any idea of what the hell is going on. When asked for a valuation, I love the look on their faces "Valuation? What's valuation? You mean how much I wanna make?" lol

Anyways, yes, it is a family business. It has seen its fair share of up and downs. I am going to give it back to my pop. I mean he still works there. He always loved to be in the shop rather than sitting in the office going through a mountain of paperwork from FAA. So he's been happy about the current situation where he gets to go back into the shop and work on the machines.

I mean, Ive done my best with the company. The last 2 years have been just straight hustling and it had proven to be lucrative, but when companies are asking you to finance their projects, being 180 days late on their invoices, or just straight filing for chapter 11 and then ask me to get in line as a creditor... its just well... a lot. All of the contracts that I have secured are 10+ year contracts which is good... so this will give my pop time to figure out what he wants to do. Whether he wants to sell the company off or find someone to take it over and run it. Either way, the way the company sits now.. its in a good position, just not with me in it.

My pop never ceases to amaze me though. Last month we were given notification that one of our machines (Projector inspection Module) needed to start having routine inspection certification done every 30 days. We were told that the machine was too old and that we would need to get a new one. Well the new machines are fancy. Everything is digital and computerized. You enter your values, hit the go button and it will give values within +/- .004... Which is pretty good. Now our machine is old school. Its from 1975. It used to have analog readouts and such and over the years a Digimaster was aded to give us digital X/Y coords. So every 3 months my pop would calibrate the machine on his own and every time he did it he was always +/- .002. But again, thats what he "said" we never had the thing calibrated by a certified process. Well anyways, the guy to inspect the machine comes in, takes one look at it and says, "Oh yeah... you definitely need a new one. So my pop said, "Ok not a problem. But check it anyways. If its really off, we'll get a new one... but if it is within spec then you'll pass it right?" The guy just laughed and said yeah, I would but I can assure you, there is no way that is going to fall within .004. So he starts checking it and everything... Well what do you know... +/- .002, hahahaha. The guy was so surprised he checked it 3 more times and all came back the same. The guy quietly affixed the inspection passed sticker and said, "I've never ever seen that before. Either this piece was never used, or whoever does do the calibration on this is just a God." Lol, I said no, better than God. That my pop! haha. Not gonna lie, he's pretty awesome!

BabyCAP · #3 08-20-2013, 10:58 AM

Good Luck TwinTurboGTR.

I am pulling for you and wishing you success and happiness.

I think you are a good son and deserve it.

I love this line:

Lol, I said no, better than God. That my pop! haha. Not gonna lie, he's pretty awesome!

Sweep_the_Leg · #4 08-20-2013, 11:09 AM

Quote:

Originally Posted by TwinTurboGTR

I mean, Ive done my best with the company. The last 2 years have been just straight hustling and it had proven to be lucrative, but when companies are asking you to finance their projects, being 180 days late on their invoices, or just straight filing for chapter 11 and then ask me to get in line as a creditor... its just well... a lot. All of the contracts that I have secured are 10+ year contracts which is good... so this will give my pop time to figure out what he wants to do. Whether he wants to sell the company off or find someone to take it over and run it. Either way, the way the company sits now.. its in a good position, just not with me in it.

Do you not have security agreements as part of these contracts? If you're getting purchase-money security interests in whatever products you're making, and filing the appropriate financing statements, then you should be in a much better position if and when your customers do get into financial trouble.

TwinTurboGTR · #5 08-20-2013, 04:52 PM

Thanks. I appreciate the kind words. I am trying my best. As far as getting banks involved, my goal was to self finance my new project and not involve any loans. This way once the company does do well as I start it small... then I will get a credit line to either finance bigger items into the business or for emergencies. So really not looking to get a loan.

As far as security agreements... they really arent heard of in the manufacturing portion of aviation. I mean before I even took over the shop, my father would send out the invoice, the companies would pay within 30 days and everything would be good. It wasn't until around '98 when some companies would start to get lazy on paying on time. It would extend to 45, 60, 75, 90 days. Now most are at 90 days and some are at 180 days. Companies also used to purchase their own material, send it to us and then we get to work. Now we are responsible for purchasing material. Our business has a fairly high overhead to begin with. Right off the bat, our overhead is anywhere from 25 to 30% because of tooling. A lot of times we need to purchase new crush rolls for jobs and they are $10K and the job may only be a $40K job. Now crap like that I start working into the bids. So if I go into our inventory room and don't see the appropriate tooling, I will work the tooling into the bid.

These financing statements never stick anyways. My first year I did that. I contacted the 3 companies and drafted out a new policy that invoices needed to be paid within 30 days or we would yank the serial numbers and certification from the parts until parts have been paid. Basically after that statement had gone out... the companies just stopped paying all together and stopped requesting us for bids. Hence why I hauled a$$ and obtained other contracts and kept them all on a tight leash on payment. As soon as they are late, I remove their jobs from the line and drop them to the end of the line until they pay. Once they pay, then they must wait their turn again to have the machine retooled for their particular job, which in turn I charge them for 2 set up fees. So this has worked out well. But the 3 companies are the companies bread and butter. I recently stopped doing bids for DoD and the Department of the Navy because they have invoices that haven't been paid since 1991. The inventory accumulated from DoD and Navy is insane and most of the parts are no longer in use. So basically lost money.

Ricky Bobby · #6 08-21-2013, 09:07 AM

The long and short of it, is if you are in business for yourself you are going to be chasing people to cut you checks and make empty promises to pay invoices your whole career.

Hell, people can't pay their utility bills on time in their own homes, you really expect them to pay their invoices on time in business? My father in law runs a process serving agency in North Jersey (I work for him for some side work), and his job basically as boss of the company is to do all the service work for law firms, you think he ever gets paid for the jobs in 30 days? Nope.

Attorneys/legal firms don't want to pay any invoices until cases are settled and money is handed out, which means my FIL gets paid last. One firm he does work for still has unpaid work done from 2007! But they will fax him 30 subpoenas on a Thursday afternoon that have to get done in 24 hours because the deposition is on Tuesday. If he told them "I won't do it until I get paid from previous work" he'd lose them as a client.

So goes the cycle of business in this country, work now, get paid later lol.

TerminatorX5 · #7 08-21-2013, 09:33 AM

with fed. gov-t clients - get on horn with them, they have to close the books somehow... especially if they did not pay since 1991... you need to be persisitent - we have contracts too, our supplier in NJ, and they get "paid" when the ordered item is "received" in the inventory software... a lot of times item is shipped overseas, the person who ordered the item has been out of country, the item physically is received but nobody is there to "close" the order as the person is now across the globe in another part of the world, the contractor is not paid... once they got too many of those on their books, they just talked to the contract rep, and the issue was resolved - the deals were forcefully "closed" from DC and the contractor got paid...

you need to do so the same with your USG clients...

TwinTurboGTR · #8 08-21-2013, 10:54 AM

RB- Yup, exactly right. Nature of business is to chase clients to cut checks... problem is... I'm chasing everybody, meaning the original 3. If just one of them paid on time, I would be ok. But to chase the 3 biggest accounts, the only 3 accounts we had at one point is ridiculous.

Term- Yeah been there tried that. Basically after 2000, the previous invoices that weren't paid, I was basically told to go F myself. Parts were obsolete then and no longer used or amendments were made and the parts no longer worked. I even went the collection route to hire ADP for a year for recovery services... They worked at it for 12 months... out of $1.1 mil outstanding, they were able to recover $63K. Far off from their number that they suggested they could recover which was north of $500K. One of the best and worst clients we have really hurt us in the last 5 years. They moved facilities from NJ to Aberdeen, MD. We had a 25 year contract to rebuild landing gears and wing control actuators. The first 10 years of the contract was gravy... When it was announced they were going to move, they estimated 3 month transition time. 3 months turned into 3 years! Three years of no one picking up the phone, no one knowing when operations would start, etc. After they finally got settled, they lost 90% of their contracts, which in turn affected our bottom line. They have just recently started to ship us landing gears and wing controls again, but at a rate of 6 every 2 or so months. We used to get 20 every month at $22K a pop for the landing gears. They good... They always pay in 30 days, the bad... they dragged ass on the new facility and lost most of their contracts. Always something.

TwinTurboGTR · #9 08-21-2013, 10:54 AM

RB- Yup, exactly right. Nature of business is to chase clients to cut checks... problem is... I'm chasing everybody, meaning the original 3. If just one of them paid on time, I would be ok. But to chase the 3 biggest accounts, the only 3 accounts we had at one point is ridiculous.

Term- Yeah been there tried that. Basically after 2000, the previous invoices that weren't paid, I was basically told to go F myself. Parts were obsolete then and no longer used or amendments were made and the parts no longer worked. I even went the collection route to hire ADP for a year for recovery services... They worked at it for 12 months... out of $1.1 mil outstanding, they were able to recover $63K. Far off from their number that they suggested they could recover which was north of $500K. One of the best and worst clients we have really hurt us in the last 5 years. They moved facilities from NJ to Aberdeen, MD. We had a 25 year contract to rebuild landing gears and wing control actuators. The first 10 years of the contract was gravy... When it was announced they were going to move, they estimated 3 month transition time. 3 months turned into 3 years! Three years of no one picking up the phone, no one knowing when operations would start, etc. After they finally got settled, they lost 90% of their contracts, which in turn affected our bottom line. They have just recently started to ship us landing gears and wing controls again, but at a rate of 6 every 2 or so months. We used to get 20 every month at $22K a pop for the landing gears. They good... They always pay in 30 days, the bad... they dragged ass on the new facility and lost most of their contracts. Always something.

TerminatorX5 · #10 08-22-2013, 09:30 AM

I think it is also sometimes called incorrectly as draft beer while the correct way should be draught, even though, pronounced almost the same...

I think, what Artem is describing, would probably be called a beer hall... I remember some in Moscow, that had automated dispensing machines, like vending machines - you drop xx amount of coins, stick your vessel (usually a 3 liter jar - "banka") and it fills the jar up... you could also get some hot dogs without buns, "sosiski" with some nuclear mustard (I love that mustard, it makes you grow hair on your chest!!!)

given the customer base in russia who drinks beer, i don't think a pub or a microbrewery will survive...