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I started a company called U.S. Install. It was an idea, wherein we would use subcontractors across the United States to perform consumer electronics installations. My company itself would not own any trucks, any ladders or screwdrivers... we would simply provide overhead absorption to other companies, giving them additional demand for their existing workers. The demand would come from retail partners I could offer the service to who did not need to have their own W2 installation expense... they could simply refer the jobs to us, we would subcontract the jobs out, and then rebate the retailers for a percentage of the installation expenses. For simple math, we would
Install a television.
The consumer might pay $99.
The installer would keep $80.
We'd keep $10.
We'd give $10 to the retailer.
So far, so good. However, the retailers we were interested in were national retailers. We began to assemble a database of installers. Contracts, credentials, insurance... we had just a few people in a few cubicles in Minnesota running the "company." In theory, a job would come in, we would subcontract it, and everyone makes money.
So we started. With Walmart. (you can probably see where this is going before I even get there). We beat out several competitors for a live test with Walmart, under the pretense we would be able to scale this if successful. So far, so good.
We started with Walmart in Kansas City, MO. Single market, a few Sam's Club locations. No big deal. We found an awesome contractor. Everything went smoothly. So smoothly, that 30 days in, we added a second market. Then a third. Then a fourth. Then we added Circuit City's Fire Dog installations in select markets.
We never lied about how we were doing what we were doing (subcontracted labor) but we stretched the truth about what our capabilities were. We figured, as most do, that we would cross that bridge when we came to it.
Then we came to it.
Walmart's appetite increased much faster than I could glue things together. The world's largest retailer was my first customer. Balls of steel, but without really any infrastructure or capability to perform. Overpromised. Undercapable. Some times, it's not that easy to cover a "white lie" which is a cute label we use when we don't want to really get introspective on a real lie. I was definitely over my head. People trusted I was who I said I was. And I was... sort of. But the sort of not was about to let down the world's largest retailer and the people ... the faces... the real people that entrusted me as they stuck their necks out for me with their job credibility resting on the contractor they committed to. I had to find a solution - for them, not for me. Saving face was over. Now it was time to figure out how to finish what I started as much to save all of the people that were involved. Real people, real lives, real jobs. It wasn't a game.
I didn't have several months to get capitalized, or really even several weeks to methodically backfill Walmart markets all across the United States.
In a fire sale, I sold the company right when things were about to get real. I had oversold my capabilities. It cost me the company.
Fast forward to today. It's a decade plus some later, and the company that acquired my operation from the scrap heap still handles some consumer electronics installations at Walmart today. The idea was right, the intention was right, but the execution was horrible and the integrity was questionable.
There probably would have been a better path. This became one of the scars that I wear even today.
Install a television.
The consumer might pay $99.
The installer would keep $80.
We'd keep $10.
We'd give $10 to the retailer.
So far, so good. However, the retailers we were interested in were national retailers. We began to assemble a database of installers. Contracts, credentials, insurance... we had just a few people in a few cubicles in Minnesota running the "company." In theory, a job would come in, we would subcontract it, and everyone makes money.
So we started. With Walmart. (you can probably see where this is going before I even get there). We beat out several competitors for a live test with Walmart, under the pretense we would be able to scale this if successful. So far, so good.
We started with Walmart in Kansas City, MO. Single market, a few Sam's Club locations. No big deal. We found an awesome contractor. Everything went smoothly. So smoothly, that 30 days in, we added a second market. Then a third. Then a fourth. Then we added Circuit City's Fire Dog installations in select markets.
We never lied about how we were doing what we were doing (subcontracted labor) but we stretched the truth about what our capabilities were. We figured, as most do, that we would cross that bridge when we came to it.
Then we came to it.
Walmart's appetite increased much faster than I could glue things together. The world's largest retailer was my first customer. Balls of steel, but without really any infrastructure or capability to perform. Overpromised. Undercapable. Some times, it's not that easy to cover a "white lie" which is a cute label we use when we don't want to really get introspective on a real lie. I was definitely over my head. People trusted I was who I said I was. And I was... sort of. But the sort of not was about to let down the world's largest retailer and the people ... the faces... the real people that entrusted me as they stuck their necks out for me with their job credibility resting on the contractor they committed to. I had to find a solution - for them, not for me. Saving face was over. Now it was time to figure out how to finish what I started as much to save all of the people that were involved. Real people, real lives, real jobs. It wasn't a game.
I didn't have several months to get capitalized, or really even several weeks to methodically backfill Walmart markets all across the United States.
In a fire sale, I sold the company right when things were about to get real. I had oversold my capabilities. It cost me the company.
Fast forward to today. It's a decade plus some later, and the company that acquired my operation from the scrap heap still handles some consumer electronics installations at Walmart today. The idea was right, the intention was right, but the execution was horrible and the integrity was questionable.
There probably would have been a better path. This became one of the scars that I wear even today.