I promised in another post ( https://www.thefastlaneforum.com/general-business-discussion/30853-100-000-behind.html ) that I’d tell everyone in detail what my past businesses have been and why I think they failed.
My first business was P J Hauling. I started it just out of high school while I was going to the local community college. I didn’t really plan nor do market research for this one, I just sat down and thought up different ways I could make money instead of getting a job. I decided to buy a little half ton pickup and start doing general schlepping. I would do anything that someone without a truck wanted me to do. Cleanups, deliveries, moving, you name it I did it. I came up with the tagline: “Just Hauling My Way Thru College†Everyone loved it. I think I got most of my business from that tagline, who wouldn’t want to help a young guy going to college?
I kept quite busy with the business and started missing classes. I decided that I was learning more about business running a business than I was studying it in college. So I drop out of college and focused completely on my business. Since I was no longer in college I changed my tagline to: “Refuse Removal and Truckingâ€.
I learned quite a bit about marketing with P J Hauling. Very early on I printed up flyers and business cards to hand out to people. I thought about whom my customers were and where they were coming from. I found that most of them were people from the city who had a second home. These people mostly were being recommended to me from a couple of real estate agents who happened to see my truck all the time. I took the flyers and business cards to the real estate agents and talked to them one by one about my business and what I could do for them. I immediately started getting referrals from all the agents.
I soon out grew my little pickup truck, so I bought a trailer with a loan from the bank. One trailer turned into two trailers and my little half ton pickup up turned into a dump truck. This allowed me to expand my services into more commercial jobs. I started to haul stone, gravel, scrap metal.
At this point I had read several business books and I decided that I needed to “brand†my business. So I lettered up my dump trailer with: “Drop N’ Load Mobile Dumpster†as I would drop the trailer off at a customer’s property so they could fill it up with all their junk and I would haul it away. Much like a roll off dumpster. This worked out quite well, because I could do other things while I was making money. I had visions of an entire fleet of trailers all being at customers properties making money while I was just sitting in my truck hauling them around. It worked out well but not enough. Contractors saw what I was doing and decided to do the same with their trailers when they weren’t’ using them.
One day I was reading the local paper and I saw an article about how the county landfill was going to but closing their transfer stations on Saturday to cut costs. I knew that Saturday was a very busy day due to most people having to work all week and it being their only day to take their garbage there. Seeing this as an opportunity to be newsworthy and make some money I started making a plan to profit off this. (Again with the business books, to this day that’s still all I read) I researched the laws and regulations of the transport and storage of garbage on the NYDEC’s website and decided that I could set up a site where I would collect the garbage on Saturday from all the people, leave it in my dump truck until Monday when I would take it to the landfill. Just to be sure I called the DEC and asked them if they saw anything wrong with my plan. They said it was ok.
I wrote a press release that said “Local Businessman Trumps Dump: Opens garbage collection site on Saturday†(My friend was a copywriter in a former life) I sent the press release to all the local papers and hoped for the best. One of the things I did which I still think was ingenious, was that I made up a sign that said “They’re Closed but We’re Open†with directions to my site and put the sign on the gate of the local transfer station. I then had signs leading them to my site. Saturday comes and I had over a hundred people bring me their garbage. I thought this was great!
That week a reporter from the newspaper called me and asked to do an interview with me. I agreed and met with him. He asked a bunch of questions and I told him all about what I was doing and why. I was ecstatic. All week I kept looking through the paper to see if he wrote an article on me. Come Friday I am floored when there on the FRONT PAGE of the newspaper is a picture of me standing next to my truck. I quickly flip to the article on page 3 and eagerly read through it. It was great except that he had made the story more of a controversy between me and the DEC. He apparently had talked to the DEC and they told him that what I was doing was illegal and if they found out I did it they would fine me $10,000. To top it all off at the end of the article he misquoted me and wrote “I don’t care what they say, I’m going to do it†Needless to say by noon I had gotten a cease and desist phone call from the DEC.
I told you this story because I think it has a lot of lessons in it and because I’m still kind of proud of the fact I was on the front page of the newspaper. Just a few of the lessons I learned from this experience are: don’t take everything you see on the internet as the truth, don’t trust reporters, guerilla marketing works awesome, and fill a need and people will come to you.
After several years of running P J Hauling I decided that it would never get me to my goal of making a million dollars by the age of 25. So I started to look for other opportunities and businesses.
The reasons why I feel this business failed are as follows:
LACK OF PLANNING
I got just ran with an idea and didn’t plan on how I was going to execute it and make money.
NO MARKET RESEARCH
This ties in with lack of planning. I didn’t find a need to fill; I created a business around what I wanted to do. (I saw this later on and attempted to fix it but it was too late because the overall need wasn’t there.)
LACK OF CAPITAL
I entered a business with some larger competitors already in place. These businesses were more able to throw money at it then I was. One of my competitors was a garbage company and when they saw that I was making money with the trailer they went and bought a bunch of them and started undercutting my pricing.
LACK OF EXPERIENCE
I cannot overlook the obvious fact that I was inexperienced with running a business. I managed the business as a job and the finances as my personal money.
NOT SCALEABLE
I was never able to scale the business up from just myself. Every once in a while I would hire a couple of kids to help me on a job by job basis, but I didn’t have enough business to hire anyone full time.
POOR AREA
I can’t even tell you how many people would tell me, “You want how mch?! I’ll just use my buddy’s truck and it’ll cost me $20!†The people in my service area were cheap and poor.