Small Businesses With Work Trucks; A Warning


If you are a non-operator owner of many work trucks, you should keep your business credit card with you not leave it in one of the trucks. You should not issue them to employees without strict guidlines. Employees may tend to abuse credit cards by buying things that are not an emergency such as tires that are over priced instead of simply plugging a hole in a flat or spraying fix-a flat into the valve stem.

Here is a story:

A franchisee's manager who we'll call 'Arnold' had a blow-out in one of the rear tires on the duallies. It turned out the valve stem ripped out. He drove about two miles to a tire shop and decided to take care of the problem. The tires were one-half worn, good for another 10,000 miles or one-half year. When he got to the tire shop, he could have:

Purchased a valve stem for $2.50

Put a tube in the tire for $10.00-$15.00

Or bought a used tire that was one-half worn to match the other set.

Arnold wasn't sure if he had destroyed the structural integrity of the tire by driving the two miles to the tire shop. So he decided to replace the tire and not just the valve stem. Since he had a company credit card and it wasn't his money, he purchased a new tire for $75.00 plus $5.00 mounting and tax plus $2.00 for balancing. About $90.00 in all. Unfortunately, it didn't match the other three rear wheel tires and the tire man said "Tell you what I'm going to do!" He sold Arnold what he called real truck tires, four (4) of them for $350.00 calling them 'on sale.' The four used tires were taken off and thrown into the used pile. Arnold drove off with four new tires.

The next day, Steve, another franchisee noticed his tires needed to be replaced. He owned the franchise that bordered Bill's franchise. (Bill is Arnold's boss.) He drove to Herb's tire shop where Arnold went the day before. Herb's manager that helped Arnold into a new set of tires figured Steve was an easy kill but this time the $90.00 per tire became $109.00 a tire and a set of four was only $440.00 on 'super sale' of course. Steve also had a company credit card, but unlike Arnold, Steve had to pay the bill. Steve asked about used tires. The manager of the tire store tried to persuade Steve for ten minutes with talk on the safety of new tires. Meanwhile, Steve's helper had already signed up three car washes and had completed one. The manager of the tire shop gave up in frustration on trying to close the big sale and said "I have four used tires the right size but they are in good shape so I need $30.00 each plus $5.00 for mounting and tax and $2.00 for balancing." Steve laughed and said "No tax. I pay cash and it will have to be more like $20.00 per tire including everything. The manager said "I'll have to ask Herb." Herb said "Cash. Hell yes! Put them in the front of the line."

By this time Steve's worker was wiping down his third car. $80.00 for four tires is a good deal, right! Right, but Steve asked Herb if he wanted his car washed and waxed. Herb said "How much?" Steve said "How about $50.00 off my used tires?" Herb said "Great." So Steve washed and vacuumed Herb's car and then brought his truck into the work bay. Steve paid:

$80.00 Cash Price -50.00 Trade = $30.00 Amount To Be Paid - $15.00 Amount Made By His Worker = $15.00 For Four Tires

Hmm. Good Deal? Yes or No? Well guess what. Herb sold Steve Arnold's old tires that he got for free because Arnold left them there. Herb's manager charged Arnold a $1.00 disposal fee for the used tires.

Moral of the Story:

Trade whenever possible

Don't let employees have company credit cards

You can always get a better deal for cash

Company credit cards are good in some ways. For instance, you will get an itemized invoice monthly, which is good for record keeping. They are also good for making purchases over the phone or by mail. Credit cards make things much easier. They are also a necessity for ordering supplies from your online small business vendors. Think about it.

"Lance Winslow" - If you have innovative thoughts and unique perspectives, come think with Lance; www.WorldThinkTank.net/wttbbs


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