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The Golden Rule: How To Not Get Fucked In Business

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February 9, 2016
1402 upvotes

Summary

A short story over business to business relations. If you are an entrepreneur or working towards being self employed, you need to read this post.


Body

Let's say I had two friends, Tim and Kevin that both started separate businesses. Kevin goes and finds a single customer that will generate $1,000,000 in sales for the year. Tim goes out and find 20 customers, but each customer only generates about $50,000 dollars a year in sales.

Well let’s say I was Kevin's one customer.

I call Kevin up and say, ”Sup bro, I got an order for you, i’ll send in the Purchase order for $100,000.” Kevin’s ecstatic, holy shit he’s never seen so much money before in his life. He just started this business and is so excited that he landed such a lucrative contract. He spent the last 4 years going through college to get his business degree, he got married to a lovely girl, they had a kid so she decides to be a stay at home mom at least till he’s old enough for school. He’s been slaving away in corporate America for the past 8 years to pay for college and save up enough to finally start his own business. He’s got this shit on lock. He’s got the work ethic to make this deal happen and he’s going to crush it.

He takes out a mortgage on his home to front the startup loan from the bank. He heads out and buys all the materials needed to complete the job. It end up costing him $60,000 grand to complete the job, 40k isn’t a bad profile margin. From the moment he buys his material from his vendors, he has 30 days to pay them back. That’s the default pay period when business to business transaction happen, usually called Net 30.

Kevin thinks he might be able to get a bit more money out of the work though. He contacts me and tells me he underestimated the quote and it’s going to be an extra 30k to complete. Kevin assumes I’ll understand as this is his first time and I’ve been mentoring him through his whole upstart. I let him know that’s fine and we renew the purchase order for $130,000.

Now he’s going to make 70k profit! He doesn’t waste any time. From day 1 of him picking up materials he is off putting in the time, labor, sweat and tears to get this done. He’s going to make a killing.

Kevin and I meet at a trade show last year through mutual interest and I saw the passion in his eyes to get shit done. I knew he had the hustle, he just need a push in the right direction and some incentive to get started. In this case, $1 million in sales a year is what I offered him.

Let's talk about me a little. I’m in my 50’s, been the president of a division of a billion dollar a year corporation for about 10 years now. Our division alone put out $230 million a year in sales. Our parent company that owns us reaches 1.6 billion a year. Kevin’s 1 million dollar account doesn’t even merit a second glance in the accounting office.

Back to Kevin. He finishes up his work. Spent all his material and the job is done. At 25 days since his first material purchase, he still has just under a week to pay back his vendor at the Net 30. Not to worry, vendors know the game, sometimes it takes a bit to get the money before the last tier supplier get’s his check. He learned all this in business school.

He calls up the main office and gives my secratary the news. ”Great Mr Redwood is on vacation in the rockies for the week! When he gets back I’ll have him check out the work and you’ll be seeing the check in the mail within a few business days.” Kevin’s ecstatic, his first big deal. He’s about to bank 70k profit in a month.

Week goes by and nothing. He calls but doesn’t reach me. The secretary tells him that I’ll be back by tomorrow to inspect the work first hand. Great, he’s had to dig into his savings a bit to pacify the vendor till the check comes in. No worries though, Kevin and I became good friends during this last year and he still has money back in the bank.

Two weeks go by and nothing, He can’t reach me as i never gave him my private cell. He calls the main office, secretary tells him that I checked it out, work was awesome and the check is in the mail. Great, he had to spend some more savings on some emergency medical issue with his kid but now he’s about to bank 70k. He’s dreaming about what this job will be like at the end of the year. The vacation he’s going to be able to treat his family too. Hell, imagine what this will be like in 2 or 3 years. Kevin is literally on cloud 9. The past 8 years has brought him to this moment.

3 weeks, nothing. He’s starting to worry. He’s out almost 60 days and his vendor is starting to send notices. He calls but nothing.

4 weeks past Net 30. same run around.

5 weeks out. still no check.

6 weeks, same.

7 weeks, same.

8, same.

9 weeks. Kevin files for bankruptcy. His vendors take him to court for the money he owes. All his assets, house, everything, seized by the banks. His wife can’t stand him. How could she marry such a loser. How could this have happened? Hell, this is illegal right?

It is absolutely, one hundred percent, positively illegal to do what i just did to Kevin. But good luck trying to take my $230 million dollar a year company to court while you are in the middle of filing for bankruptcy and have no other income source, Kevin.


If you think this story is bullshit or this would never happen in modern day America, I can be assured that you’ve never ran a business longer than a few years. Or, you at least have the privilege of not working in my line of work. I’m 25, I’ve been doing what i do for 10 years, I’ve seen it happen twice. My father has seen it happen more time than he can count and so have many others that I have been mentored by.

My father sat me down one day after he got a call from a company and he said, "Clint, one day you are going to get a call from a customer or new company. They are going to offer you more money than you've ever seen before in your life. It will be like holding a winning lottery ticket in your hand. All the shit you can do with that amount of money will flash before you. It might be equal to or even dwarf our entire sales for the year. Everything in you will tell you to take that deal.

Don't ever take that deal."

A large corporation with tons of power goes out and finds some chump that’s eager and driven, they offer him a deal he can’t refuse, only to burn him, not pay, and there is shit he can do about it. They hold such an immense amount of power and influence over you that you can not possibly take them to court. They will drown you in legal bullshit and it will cost you more than you can imagine.

Now, that 100k, that’s nothing. That’s like a week of sales for most small business. As in 5-50 employee sized businesses. I use 100k because to most ordinary people, that’s a lot of money. Oh, and that extra 30k Kevin thought he was getting out of me. Ha, whatever Kevin wants to hear is what Kevin will hear. I’m Kevin’s #1 sycophant, I’m the ”Yes” man.

In business, the more charming and the more enthusiastic a person is, the more you should be skeptical of them. It’s sometimes hard to identify a con man vs just some guy that’s really passionate/charismatic, that takes time and experience. But a good businessman weighs his options and never makes split decisions. A con man will tell you everything you want to hear without a second thought. If you want to know if you are getting conned, present them a serious issue that needs to be discussed, in this case a 30k quoting mistake. if it’s answered in a minute or less, you’ve got problems.

Conmen talk from an emotionally drive narrative not logic. They will play off your vibes and how you react, not through logic or planned out thoughts. They will have a basic plan for the con, as in me offering a million for enticing Kevin. But their delivery is always rooted in emotional manipulation and getting you to shut down your logical thought process. If you feel emotion, happiness, sadness, anything when making a business deal. Stop, don't make a decision, calm yourself, leave if need be, hell take a week off if you have to. You must be grounded and level when you make giant decisions. Meditate if need be.

The company I saw get burned, they bought 1 million dollars in equipment and material to get a job from a very, VERY reputable corporation. You are probably imagining some slimball president of some shady corporation that could be morally and ethically relatable to Skynet if it was ran by Saul Goodman from Breaking Bad.

You’d be dead wrong.

This company that burnt them was a company every single one of you knows of. Hell, half of you probably own an appliance by them. I’ll just repeat that again though if it didn’t set in though. They spent $1,000,000 and didn’t get a dime, filed for bankruptcy a few months later. By a company that pretty much all of you know and trust to make good products.

Oh, and that company that got burnt for 1 million? Ya, that wasn’t some dude like Kevin. That was a company that was in business since the 80’s.

“So what went wrong? Fuck, this is hella illegal!” Doesn’t matter what is legal or illegal, it’s what you can get away with. You think laws stop people from doing things? Fuck no, we break laws all the time, the only thing that stops people fucking one another over is if they can get away with it or not.

Bullpill advice would be, take them to court, try to get your money out of them. It will be alright. We believe in you and we are here for you.(random people on the internet that he probably tried to consolidate with or advice some friend gave him).

I’ll tell you right now that advice is worth less than the air and calories it took to say it. here’s the redpill advice. Kevin, you fucked up. You let your emotions and the alluring of dollar signs sway your decision making skills. You saw $1,000,000 written out and said, ”Holy shit, One million dollars, sign me up.” You let emotion, lust and greed trump logic and planning. You saw a big shinny number, from a company you know and love, that everyone knows and loves, that’s been around forever and you took that as merit for them to be a trustworthy client. Instead of sitting down and looking ahead of what they could do to you if you accept their deal. You thought you were playing blackjack when they were playing chess. You made one move and thought you won the game and didn’t think anything past that. You broke the #1 golden rule of business.

Never have all your eggs in one basket

Let's take a look back at Tim. I bet you forgot about Tim. In the amount of time Kevin went from 25k in the bank and owning a home to being homeless, Tim cleared 5 orders of 20k each, cost him 15k in materials each, resulting in 25k profit and 100K sales for the month. Good job Tim.

Why? because none of Tim’s customers have power over him. If I tried to pull the shit that I pulled on Kevin, Tim can fall back onto his other accounts to support his business and life style, and have the money to take me to court in the process.

Tim, can’t be fucked with, because Tim has abundance.

Tim is in A Position of Fuck You


Lessons learned

This is just one rule of business that I’ve learned through the years being mentored by some truly alpha men. I never correlated it with abundance mentality till TRP though. But it is the #1 rule of business and it’s one they constantly drill into my head. The shit these men have shared with me and taught me is invaluable and stuff you can’t find in textbooks. It’s only learned through experience. Textbooks will teach you what to do if everyone plays by the rules. It won’t teach you a damn thing when it comes to playing the game with people that break the rules.

There is a lot of benefits to the golden rule than foreseeing getting fucked over. For instance it’s not always some dickbag trying to fuck you. Maybe one of your customers goes out of business just due to the economy. Trust me, they won’t tell you they are going under, a lot of times you won’t even know, their purchase orders will just stop coming in or they just go radio silent. If they were 25% of your business, you’ve got problems. You may not go under but you will be laying employees off or taking a pay cut yourself.

At our company we tried to make sure none of our customers gets above 10% of our sales for the year. 5-7% is the sweet zone. If you can manage that, no customer can fuck with you. you should track these number religiously, because trust me, your customers know how much money they pay you a year. And they will use that number to throw their weight around. If you don’t know your % then you don’t know what kind of negotiating power you have. Basic Sun Tzu teachings, ”Know yourself and know your enemy.”

If rule # 1 is never have all your eggs in one basket, then #2 is never let your customer know how many baskets you have or how big their basket is(also a Sun Tzu teaching). Customers will straight up ask you sometimes, ”How much of our work is your business.” If they are above 10%, your answer to that question is always, ”I have no idea off the top of my head, I’d have to speak with my accountant on that.”. They can’t use what they don’t know against you. If it’s below 10%, you tell them exactly what their % is so they know they can’t fuck with you.

Basic misdirection and power play.

If a customer is over 25% of your business, you should be sweating bullets every day, you should be losing sleep and pulling your fucking hair out. You should not be eating till you secure another account and drop that 25% to 10%. At my company we have dynamic employees, we don’t have dedicated sales reps as sometimes sales are not what we need. When customers hit 15-20%, sales reps head out the door looking for new work or we contact current customers for more work to level the playing field. Growing horizontally is always better than vertically. This is also why consumer goods are great to get into, then you literally have thousands of customers that don’t even equate to 0.1% of your sales. No one owns you and no one can bully you.

If a customer knows they are 35%+ of your work, I don't give a shit who's name is on the sign out front. I don't care who or how many people own shares of your company. If a company is 35%+ of your total work, they now own your business. They just may or may not know it yet. This the most important thing I can ever teach you about business. You become a slave to your customer the moment you are not in a position of Fuck You.


This post is the first of two. The second is called, "The Dark Rule: How To Fuck Someone Over In Business". I strongly suggest you read it as it contrasts the opposite side of the moral spectrum. You can find it in my post history or search in the sidebar.

I’ve been wanting to make post on business for a while now but find it hard to separate and distance myself without revealing too much personal information. I grew up in a family business since i was a kid and I’ve read some post on askTRP that sparked me to write from my experiences. I usually write based off of a comment or question i come across so if you have any questions or topics you’d be interested in me covering, feel free to ask away. I think the next post will be on navigating the business world as a kid coming into a family business. There is a lot of do’s and don’t, how to manage co workers, conflict resolution, workplace efficiency, the shift you have from going to employee to management level, etc.

Edit:

It's came to light in the comment section that there are many other pitfalls that could have been avoided by Kevin if he took more preventative measures. While I am aware of them, I felt adding them would detract from the main point of the topic. I solely wanted to revolve the article around diversification and horizontal growth. I strong recommend you read the entirety of the comment section as there is a tremendous amount of advice in it, If not more, than the main article.


Post Information
Title The Golden Rule: How To Not Get Fucked In Business
Author Clint_Redwood
Upvotes 1402
Comments 292
Date 09 February 2016 02:59 PM UTC (4 years ago)
Subreddit TheRedPill
Link https://theredarchive.com/post/39353
Original Link https://old.reddit.com/r/TheRedPill/comments/44x0o9/the_golden_rule_how_to_not_get_fucked_in_business/
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Comments

[–]Do not send modmail to my personal inboxCrazyHorseInvincible[M] [score hidden] stickied comment (5 children) | Copy

Would the people reporting this please learn the difference between "lie" and "obvious hypothetical"?

Thank you.

[–]HS-Thompson112 points113 points  (12 children) | Copy

There is a lot of truth to this, but as someone who as started and run several businesses, and currently gets a large chunk of my billing from F100 companies, I think it's at least somewhat overblown.

There are many things Kevin could have done to minimize his exposure to this situation besides just being scared of a big order:

1) He could have ensured his business was properly capitalized. If he had secured sufficient credit with sufficiently long payment terms (even if he personally guaranteed it) he would have had enough runway to chase you for the money.

2) He could have insisted on at least some payment up front, enough to cover out of pocket expenses, and walked if/when your firm balked. In my experience this is the number one simplest thing a small business can do. The people who won't pay deposits are the people who will stiff you.

3) He could have redlined the contract before signing it. If it had onerous anti-lien clauses and whatnot he could have insisted they be struck in the absence of a deposit. If you were using a purpose-built entity (as is common in the CRE business) he could have insisted on joint and several liability with the parent company, or asked for a "good guy clause" of some sort.

4) He could have worked out better relationships with his suppliers and negotiated slow-pay for his costs as part of his procurement process.

5) He could have played legal hardball when you made it clear you wouldn't be paying on time. You paint this picture of a massive all-powerful corporate entity that you can't sue, which in my experience doesn't match reality at all. You can and should use litigation and the threat of litigation to get results. I have gone up against companies that are way more well-funded than me without many resources and it's totally workable, just requires different tactics. Force the issue with an OSC hearing and a TRO prohibiting them from using the work product until the case concludes. File an ex-parte trespass to chattels to reclaim any materials delivered, since you still have title to anything they haven't paid for. File against out of state business executives personally and subpoena them for depositions. Are their wives or children part of the business? Great, file and serve them too as codefendants, let them show up and ask for removal. And so on.

Those are just off the top of my head. This post is decent advice but to me all it's saying is just something like "don't go into business unless you know what you're doing and understand risks" or maybe just "don't risk your entire financial status on a contract if you don't already have a decent lawyer on your team."

Most of us who run businesses learn lessons the hard way from painful experience, and maybe a great mentor if we're lucky. I'm not sure if there are any shortcuts.

Furthermore, you present a very one-sided view of taking on business risk. Many if not most entrepreneurs have at least one story of being completely underfunded and exposed to ruin during their early years. Sure you can avoid taking on the project at all, but getting business is hard, and growing a business is hard. It's entirely possible that by avoiding all situations where you have one big whale of a customer you'll just never get off the ground and also fail.

At the end of the day good business people build good businesses. Managing risk and having contingency plans is part of being a good businessman.

[–]BradPill18 points19 points  (2 children) | Copy

Finally some sense here - I commented just now, worded differently - yours being more laid out and specific - well done.

[–]JustClickingButtons2 points3 points  (1 child) | Copy

I don't get the love for this thread. If one is dumb enough to fall for the plotline of horrible bosses 2, they deserve it imo.

[–]BradPill1 point2 points  (0 children) | Copy

"Business for dummies" .... 1.058 votes.... WTF LOL

[–]Endorsed ContributorClint_Redwood[S] 17 points18 points  (3 children) | Copy

I am very aware of the other preventative measures Kevin could have taken. However, it would have detracted from the main point of diversification and horizontal growth. I didn't want the article to go off into a tangent or throw too much information at the reader as there is already a ton of info in both articles.

I've edited the main article to tell readers to go through the comment section as there is a great deal of information on how to prevent the shortcomings of Kevin.

[–]Endorsed ContributorRedBigMan6 points7 points  (0 children) | Copy

You forgot to add a tl;dr which would have summarized the whole situation.

Avoid getting into a situation where one contract going sour can screw you.

Works as well in business as it does with women.

[–]netherlanddwarf2 points3 points  (0 children) | Copy

The post is a great way of teaching would be business owners to watch their ass no matter what. I was naive and I still sometimes catch myself wanting to believe in the good of people, it's just not okay to give goodwill and put your own ass on the line when it comes to business.

[–]icecow0 points1 point  (0 children) | Copy

I often run in to this problem when I try to write. I crop the story to be manageable to the reader and to make isolated points. Then people rip me a new one pointing out irrefutable real life realities.

[–]_TheRP2 points3 points  (2 children) | Copy

Yeah I agree. This is easily avoided.

First of all - make sure you understand the nature of legal agreements in the business you are working. If you don't, it's worth the $500-$2000 (depends on the agreement, of course) to have an attorney look over agreements and give you advice on negotiating changes. That in and of itself will prevent pretty much everything in the above from happening.

Second, if you need to buy a lot of capital equipment or supplies up front to start work, you should always be negotiating to get some portion of the money up front. Ex: I won't start work without 40% in my hand. Period.

Third, companies hate lawsuits. No major company is going to fight you over a few hundred grand when you've got a valid agreement, they're going to either flat pay it or start negotiating in good faith. They aren't going to blow a pile of money on lawyers with the risk of still losing on top of a potential public shit storm for fucking over Joe-The-Plummer for a few hundred grand. They're going to write checks pretty fucking quick.

[–]HS-Thompson0 points1 point  (1 child) | Copy

Third, companies hate lawsuits. No major company is going to fight you over a few hundred grand when you've got a valid agreement, they're going to either flat pay it or start negotiating in good faith.

Exactly. It's this part of the story that's just sort of literally nonsense. Why can't you sue a client for non payment?

[–]_TheRP1 point2 points  (0 children) | Copy

I have no idea.

In my professional experience non-payment issues with big companies are almost always administrative. Meaning it's some asshole in the AP department that is too lazy or stupid to do their job, or maybe nobody spoon fed them the approvals and they are too lazy or stupid to go and get them to pay the bill.

That tends to speed up when their legal department forwards a memo from your lawyer to whoever is operationally in charge of what you're working on.

[–]Ali_Safdari0 points1 point  (0 children) | Copy

This.

OP's character Kevin is a total loser. No reasonably smart businessman would fuck up that bad.

[–]mydogtaco0 points1 point  (0 children) | Copy

tips to protect own business

[–]notaserialkiller 47 points47 points [recovered] | Copy

There‘s a chinese saying about how to succeed at business:
先收錢后花錢
多收錢少花錢
first receive money, then spend money
receive more than you spend.

[–]Dopebear8 points9 points  (1 child) | Copy

Something so benign and logical yet many seem to make a purposeful effort to go against.

[–]happyhorse_g2 points3 points  (0 children) | Copy

Almost as blunt as the Japanese motto of 'do it now, do it right away'. And that's for life, not just business.

[–][deleted] 190 points191 points  (90 children) | Copy

As the lawyer who shows up, that the big boys don't expect. I can tell you the OP is giving you the truth. Big companies will rape you like a prison bitch because they know most people will lay down and take it. That no law firm will step up to take them on (even when there is an arbitration clause). And that the people fucked over won't show up and righteously murder the scum who fucked them over, killing the people who fucked them over, their friends, their family, and everyone else in the business. So they have nothing to fear. No one is going to rig a pipe bomb to their toilet so that when they flush sodium powder mealed with fine powder magnesium is then dumped into the water tank to detonate a ten pound black powder charge in a waterproof case filled with screws. No one is going to rig simple mousetrap bombs to their wheels so when they pull out of their drive way, a thirty pound black charge bomb mixed with twenty pounds of red phosphorus goes off underneath the driver's side.

If you go into business, get a good lawyer to act as your admin and give you a heads up on how not to get fucked. How to demand installment payments on work instead of doing all the work and awaiting pay. How to file a lien on a property you did work on even though there is a lien waiver clause in the contract (question of first material breach). And how not to do work based on verbal requests that the company will later deny having asked even though there are emails for the requests, some paid invoices for the work, and all kind of evidence showing the work was requested and done in violation of the Master Services Agreement which the contractor will hold up and say you shouldn't get paid because you violated.

But people think they can do things cheap, skip the lawyers, and then rationalize their fiscal rape. And they won't kill those who fucked them. Thus they get what they deserve.

[–]HS-Thompson23 points24 points  (3 children) | Copy

That no law firm will step up to take them on

As someone who has been a party to commercial litigation multiple times this doesn't ring true to me at all.

I literally can't imagine a situation where you have a company on a clear breach of contract/payment case and can't find at least a half-decent lawyer to threaten and/or file against them for a couple grand.

Do you guys live in towns with like a thousand people in them or something where there are three lawyers and they are all recused out? Have you watched Erin Brockvich too many times?

[–]BleachedWhale3 points4 points  (2 children) | Copy

Agreed. This whole post is masturbatory..

[–]HS-Thompson1 point2 points  (1 child) | Copy

Indeed. And I know a lot of lawyers, I find it incredibly unlikely that there's an attorney thorough enough to pass the bar and succeed in commercial contracts practice but stupid enough to claim they are a lawyer in a public forum while implying they would consider using explosives to target their adversaries, with specific details.

But it's a big world out there I guess.

[–]Enjoyitbeforeitsover0 points1 point  (0 children) | Copy

It's good when there's a bit of uncertainty in a post and people make the point. When 100% of people on here just agree on something I feel something's not right.

[–][deleted] 17 points18 points  (3 children) | Copy

Before I was running an agency, I was a freelancer.

The only company that ever fucked me over for payments was also the largest company I'd ever worked with - a business with over $300M in annual sales

Yet my $7k worth of freelance work was apparently not worth paying for them

[–]rakov14 points15 points  (1 child) | Copy

That wasn't head of company though who decided to fuck you over, it wasn't the one owning these 300M$ - it was some small hired employee who probably isn't responsible for shit, and who decided it's just more simple to not pay.

[–]Endorsed ContributorClint_Redwood[S] 4 points5 points  (0 children) | Copy

This is the more accurate explanation than my OP. The employee might run it by the owner or a higher up manager but a lot of times huge corporate CEO don't handle it unless it is a huge contract compared to their total sales for the year.

I keep the OP simple and relatable to the CEO since adding in a bunch of middle management or payable/receivable employees wouldn't add anything to the story other than more words to read.

[–][deleted] 5 points6 points  (0 children) | Copy

I would have asked you if suing them would hurt your business. If you said no, I would have asked to see what communications you had between you and the company (in email and letter form). Then I would have had you write letters based on drafts of my own letting them know you were owed money and to dispute it if they felt differently. Like most big boys, they'd ignore you and set themselves up for an account stated cause of action. Then I'd file a suit in small claims and ask for one third of the money owed, paid up front.

[–]Libertarian-Party28 points29 points  (4 children) | Copy

Lol that revenge part was very specific.

Pure violence gets you in the sights of the authorities. It's better to play the victim while employing third parties to plant incriminating evidence of let's say, rape or drug trafficking. Prison sentences usually come up with fines, and while all eyes are on the guy that conned you, calmly report separately that he also took your money. BOOM prosecutors will eat this shit up and you'll probably get a hefty compensation sum from the parent company, while the actual businessman gets 25 years in pound-me-in-the-ass prison plus loses all his savings and has to go to real prison instead of "white collar tennis court happy prison."

[–][deleted] 3 points4 points  (2 children) | Copy

plant incriminating evidence of let's say, rape or drug trafficking

Child porn is way easier, as long as you can access their computer (even at home!)

[–]MuleJuiceMcQuaid4 points5 points  (0 children) | Copy

Did Jared owe you Subway coupons or something?

[–]xxmindtrickxx0 points1 point  (0 children) | Copy

Child porn is way easier, as long as you can access their computer (even at home!)

How would that ever be easier, you would first have to obtain the porn, which is more than likely going to end with you in jail.

Drugs are easy to obtain and have to be done in person and can end with as many if not more problems.

[–]Endorsed ContributorClint_Redwood[S] 53 points54 points  (7 children) | Copy

But people think they can do things cheap

This is probably the third rule I was taught. Never buy cheap and never buy the most expensive.

The most expensive is usually some bullshit name your paying for like a colt revolver when any revolver for half the price does the exact same thing.

The other side is never buy cheap. should be self explanatory.

Always analyze any reviews or records of who you are working with or purchasing then find the middle ground guy. He has the quality and history to back his product but hasn't reached the renown to charge out the ass for some name like Colt.

[–]I_HaveAHat8 points9 points  (5 children) | Copy

What field of work are you in exactly?

[–]billcosbyeatsbabies7 points8 points  (1 child) | Copy

the question we're all dying to know.

[–]Endorsed ContributorClint_Redwood[S] 15 points16 points  (0 children) | Copy

I have worked in a field before.

[–]CryptoManbeard3 points4 points  (2 children) | Copy

It's probably GE since they do appliances but also a million other things.

[–]I_HaveAHat0 points1 point  (1 child) | Copy

Yeah, but like as a lawyer, or businessman or what?

[–]espero2 points3 points  (0 children) | Copy

Love the colt reference :D

[–]TRPhd23 points24 points  (46 children) | Copy

No one is going to rig a pipe bomb to their toilet so that when they flush sodium powder mealed with fine powder magnesium is then dumped into the water tank to detonate a ten pound black powder charge in a waterproof case filled with screws. No one is going to rig simple mousetrap bombs to their wheels so when they pull out of their drive way, a thirty pound black charge bomb mixed with twenty pounds of red phosphorus goes off underneath the driver's side.

Bombs are complicated and get instant attention from Federal authorities. A simple shotgun using a sabot and rifled bullet can be fired from concealment at range and is just as effective but more difficult to trace. Of course murdering someone after they screwed one over doesn't fix anything, so it's a dumb/psycho thing to do, but if one were to do it then it would be better to reduce one's risk.

[–]babybopp4 points5 points  (1 child) | Copy

Explain sabot and rifled bullet please? Why would it be difficult to trace?

[–]TRPhd28 points29 points  (0 children) | Copy

Sabot is French for "shoe", and what it does is hold the projectile (in this case, a shotgun slug) while the projectile travels down the barrel. The sabot in a rifled shotgun barrel takes the rifling of the bore and uses it to create a spin in the slug. Spinning projectiles are more accurate, and in this case allows similar accuracy with a shotgun slug that one would achieve with a hunting rifle (albeit at a shorter range).

http://www.theboxotruth.com/the-box-o-truth-46-shotgun-slugs-sabots-and-smooth-bore-barrels/

The nice thing about a slug is that it is most likely a one-shot kill on pretty much anything smaller than a moose. The other nice thing for the potential sniper of two-legged deer is that when the two-legged-deer with badges and guns of their own come looking, they can't necessarily match the barrel marks on the slug to the barrel of the shooter -- because the slug didn't touch the barrel, only the sabot did.

Now, there is an issue with chokes, but buying replacement chokes and changing them out is very common. Heck, with a Mossberg 500 you can replace the entire barrel pretty easily, so if the 2-leg-deer-with-badges come looking for a rifle-bore shotgun at your house, well, all you ever bought was this smoothbore one you use for skeet. Someone else you don't know may have at one time purchased a rifled Mossberg barrel for cash from a stranger, and someone else might have bought some sabot slugs at a gun show along with some other ammunition and a knife or two, but that's got nothing to do with you. Even if the 2-leg-badge-types find a rifled barrel and some sabot slugs at the bottom of a nearby river, well, how's that connected to you? No-how, that's how.

Without a confession, the chances of a prosecution drop to almost nothing. Without linking a murder weapon they become infinitesimal. It's much easier to get away with murder than most Americans think. It's much harder, however, to live with being a murderer than most Americans think.

[–][deleted] 38 points39 points  (42 children) | Copy

If we were more vindictive as a society, we would treat each better. Would you fuck someone over if there was a good chance they'd dart you with a tranquilizer, take you out to the woods, and when you come to, force you to eat your cock and balls and then proceed to sodomize you with a sharpened wood pole, not killing you but leaving you in a state where your lower intestine is wrecked and you'll eventually die of bleeding out or sepsis. And they just leave you to die in the woods, cold, alone, and in horrible pain.

The Romans were psychos, the ancient Greeks were psychos, the ancient Egyptians were psychos. Sometimes you have to brutally murder some fucks to get everyone to behave. Personally I don't like bombs, if I'm going to kill someone I want them to suffer good and long so it can be videotaped and shown to the world.

Wouldn't it have been awesome to see Bernie Madoff forced to eat his own genitals?

[–]tonyfaulkner74 points75 points  (6 children) | Copy

This just in: We told you TRP was filled with psychopaths. Misogynist Davidkpa tells how they plan on murdering feminists.

[–]kellykebab26 points27 points  (12 children) | Copy

What a pipe dream. There is zero protection for a small business man taking out the head of some institution. He might pull it off, but given the obvious motive, he's an easy target for the law. And what's stopping the family with greater power, money, and influence from going after this murderer extra-legally? Why would they ruin his livelihood for no reason but fail to respond to him murdering one of theirs?

Vendetta cultures were probably tirelessly violent, not more peaceful. You're arguing based on wishful, if bizarre, thinking, not from reason.

[–]darkrood5 points6 points  (6 children) | Copy

You know, there are two types of people you have to watch out for:

  1. Powerful men who have all the resources to protect himself.

  2. Desperate men who have nothing to worth protecting.

One guy with a gun with enough training can easily take out police chief's daughter in America. If he just goes on a killing spree quietly, he can gun down more enemies in a day.

Imagine if you are a powerful man with so many different enemies, that when your cronies ask: "Boss, who would do this to you?"

Your mind comes up more suspects than your fingers and toes can count on.

[–]kellykebab0 points1 point  (0 children) | Copy

I agree that it seems as though someone sufficiently crafty should be able to pull off a revenge killing that might produce a chilling effect among the elite business community. So why doesn't it happen?

Your "desperate men who have nothing worth protecting" tend either to be spree killers who off themselves or go to prison because they never bother to hide their identity, or they become serial killers and evade detection only because they choose victims that no one cares about.

I am fairly confident that a man with passingly reasonable motive to target a high profile CEO would come up in investigation in interviews with the CEO's colleagues and/or records of past business dealings. Undoubtedly, the law would pull out all the stops (forensic and otherwise) to pursue the killer of a major player in the business world. Equally so for the killer of a top level cop or his family.

I mean, how is some jilted client going to be able to track the victim without being noticed or figure out the layout of the victim's likely high security home? I think the odds would be preciously slim that anyone not already in the inner circle would be able to execute a crime like this and evade detection.

I am also unsure that the repercussions to the middle class and to trust in the business world in general would be to our advantage. Obviously, if the populace spontaneously rose up en masse, that would be a different story, but the world that would produce that type of revolution would look much, much different than our present reality.

Don't get me wrong, it's tempting to imagine that ruling elites are just as subject to force as the rest of us and any one of them could be made to pay for misdeeds by any sufficiently brave loner, but I just don't see it happening.

Did JFK's assassination bring down the U.S. Government or produce any significant change in policy? Of course not.

[–]1KyfhoMyoba0 points1 point  (4 children) | Copy

One guy with a gun with enough training can easily take out police chief's daughter in America.

Chris Dorner was close - he killed the daughter of the former captain that he claims threw him under the bus.

One guy immediately cut the effectiveness of every police force in the LA area by 75%.

[–]darkrood0 points1 point  (3 children) | Copy

He also sent out manifesto, and he's actually not trying to hide the fact that he's the killer.

[–]1KyfhoMyoba0 points1 point  (2 children) | Copy

What would he have accomplished if he'd kept his mouth shut?

[–][deleted] 1 points1 points | Copy

[permanently deleted]

[–]1KyfhoMyoba0 points1 point  (0 children) | Copy

What would the 'statement' be if he'd let his bullets do the talking?

[–]Artisan_Tofurky1 point2 points  (0 children) | Copy

Aww that's a twisted, yet comforting thought.

[–]SoundMake0 points1 point  (1 child) | Copy

Vendetta cultures were probably tirelessly violent, not more peaceful.

No Sir, /u/Davidkpa is correct.

"An armed society is a polite society. Manners are good when one may have to back up his acts with his life."

Robert A. Heinlein

[–]kellykebab0 points1 point  (0 children) | Copy

A) A society that carries arms and a society that settles every disagreement with violence are two totally separate things.

B) Who cares what the philosophical musings are of some science fiction writer?

C) Admittedly, this is not a topic I am well-versed on. However, I've done a little reading on primitive cultures lately, and my takeaway is that tribal societies were much more violent than are we and the rate of violent death for male members much higher. Here is a description of a relevant book on the topic that claims tribal warfare is far more deadly than modern warfare. I believe this is because humanity has formed larger cooperative groups since tribal times and because conflict resolution is less and less based on violence.

[–]1InscrutablePUA0 points1 point  (0 children) | Copy

There is zero protection for a small business man taking out the head of some institution.

The small guy is still fucked in a vendetta system. Good luck knocking off the powerful guy who fucked you over. I guess you'd have to request help from an enemy of your enemy and then become beholden to HIM.

[–][deleted] 5 points6 points  (0 children) | Copy

You'll just cheapen life. The power plays will stay the same.

[–]RP155 points6 points  (0 children) | Copy

You have to be kidding. This would be different if people were all clear thinking, virtuous people. But they're not. Would you want this to occur because you slighted someone? Would you want this to be a common reaction to, say, a microaggression? How about to a crime you didn't commit? Or just because they were bored, a la Clockwork Orange?

Everyone has bloodlust. Watch football and join a boxing gym. Don't pollute TRP with your psychotic bullshit.

[–]TRPhd6 points7 points  (4 children) | Copy

If we were more vindictive as a society, we would treat each better.

I agree. In Viking times, crossing someone else resulted in a blood feud which could and did exterminate entire families. There was a lot more incentive to be fair in your dealings and reasonable in arbitration.

As an individual, however, it is not feasible vis-a-vis risk vs. reward to punish someone after-the-fact. If blowing them to tiny bits motivates their replacement to make you whole, then perhaps, but if you are already bankrupt then there's not much that will fix that issue post facto, no matter how much personal satisfaction it might provide.

[–]Sdom120 points21 points  (3 children) | Copy

I agree. In Viking times, crossing someone else resulted in a blood feud which could and did exterminate entire families.

The evidence is in a hundred times on this - cultures of blood honor and vengeance are weak and not places you want to live. It's incredibly counterproductive.

The system we have now is better by far, but would benefit from some changes and rooting out of corruption.

[–]TRPhd9 points10 points  (2 children) | Copy

Better is a subjective term. Based on increased productivity, certainly we are more productive. But how much more productive would we be, or could we be, if the ones in power feared the ones they rule? It's academic of course, which might as well be a synonym for unknowable. But it is interesting to contemplate.

[–]waylandertheslayer3 points4 points  (1 child) | Copy

But how much more productive would we be, or could we be, if the ones in power feared the ones they rule?

It's more likely to be the other way around. Companies have more power than individuals because they can afford better lawyers - due to more money, manpower etc. Now if there is also the option of one of you killing the other, who do you think will win? It's very romantic (not in the relationship sense) to imagine the small-time guy picking up a shotgun and going Die Hard on a faceless corporation, but that's hardly realistic.

Limiting conflict to the legal and economic arena is good for individuals.

[–]TRPhd0 points1 point  (0 children) | Copy

Limiting conflict to the legal and economic arena is good for individuals.

It's good for individuals vs. individuals. But you concede that corporations and larger organizations already have more economic and legal power than individuals. You contend that, yes, individuals are outclassed, and were violence an option, then individuals would be even more outclassed. I concur, that is absolutely the case.

However...

Since the powers that be have organized the system, they have organized it in their favor, and the only recourse for intolerable oppression is to go outside of it. Hence, revolutions. Murdering corrupt and oppressive individuals is a one-man revolution of sorts and the only justice possible in some situations.

Me, I won't die for justice, because it's really "justice", but whatev's. I understand why others feel they must, no matter how dumb it actually is.

[–][deleted] 1 point2 points  (4 children) | Copy

You know, this sound like a marketing pitch for ISIS

[–][deleted] 0 points1 point  (3 children) | Copy

It could be, it could not be, to each one's own. Laws are meant to protect people and create stability. Instead they have been perverted to empower a select few and reward the corrupt. Perhaps it is time to bring back duels and do away with corporations.

[–]Enjoyitbeforeitsover0 points1 point  (2 children) | Copy

I'd say it's far easier to begin that process going by voting for Sanders to be honest. Getting someone that truly supports Americans and has a proven long history and track record beats bringing back duels. Guy's record is unheard of and he will be a catalyst and expose corruption furthermore. I know there's a lot of Trump love on here and he fills some of the same boxes but you know Trump's history is dirty. His empire has fucked over businesses just like OP's story. But you won't hear a damn thing, of course not, you think a billionaire will allow that? Remind yourself what OP said though if people root for Trump, that hearing what you want to hear type of shit, yeah that's Trump all right. He's got an arsenal of psychological tools ready for the masses. I digressed but again, you want a huge realistic change in how corporations have huge fucking influence on a wide scale, begin by getting Sanders in. This goes for others as well, and if i'm wrong please constructively criticize the shit out of me.

[–][deleted] 0 points1 point  (1 child) | Copy

I'm enjoying and benefiting from the decline. I have zero reason to stop it. Sanders is a fond idea, but not reality as far as I see it. I get where you are coming from but he'd be one of the few honest politicians swimming in a sea of sharks. Trump is like the Megaladon of sharks, and there are few great whites for him to go up against.

Yes, he's dirty as fuck. And he is the devil we need. To stop playing to the weak and pathetic masses that yearn, ache, and crave their financial rape and mediocrity.

Trump is playing this game because he wants to be a piece of history, he is Caesar in Rome, and now wants to leave his mark on history and this is his chance. He will play dirty and play at being savoir because no one else following him will be able to pull it off like him and he knows and he wants it. I get it, I get his ego. One day I realized I was never going to be God, and I pitied humanity for it.

[–]Enjoyitbeforeitsover0 points1 point  (0 children) | Copy

Good civil discussion here mate. Let's see how this thing turns out, regardless it'll be Sanders or Trump and both would be interesting to witness. This is either going to be yuge. Or as Trump says, CHINA will have a new leader to fear. China. China.... china.. That shit is catchy as fuck. CHINA.

[–]Testoste_RON1 point2 points  (0 children) | Copy

I love this place. People who think like me. If people know that when/if they fuck you over bad enough, that them or someone they love might possibly die a horrible, slow protracted painful death; then most people will think twice before fucking others over.

[–][deleted] 5 points6 points  (7 children) | Copy

This is also why North America and Europe are kowtowing to Muslims - they know what will happen if they don't.

[–]untitled_redditor2 points3 points  (5 children) | Copy

Really? I think it's a matter of public opinion. If the civilized world decided to get "uncivilized" for a few weeks the "Muslims" would be history. We're fighting from a disadvantage because we won't consider mass murder. But if things ever get bad enough, they'll be gone in days or weeks.

[–]ezone2kil6 points7 points  (1 child) | Copy

Aww come on...some of us Muslims hang out here too...and we don't need to scuttle to Europe abandoning our pathetic country for economic opportunities then acting like sex-starved animals in the new country either...

Equating Muslims to Arabs, I'm not surprised people want to wipe all Muslims out though.

[–]untitled_redditor3 points4 points  (0 children) | Copy

I put Muslims in quotes because I don't really mean to refer to Muslims. I have good friends, basically family, who are Muslim (from Senegal).

[–][deleted] 1 point2 points  (2 children) | Copy

Well, that's just wonderful. Another reason why I want to get out of your "civilized world" before some neo-nazi retard murders me because I have a Muslim sounding name.

[–]untitled_redditor1 point2 points  (1 child) | Copy

I don't want to do that, and I'm sure we won't. I'm just saying we could. Muslims are mostdef safe and welcome on Reddit.

[–][deleted] 3 points4 points  (0 children) | Copy

I'm actually an atheist named Ahmad. But hey, sometimes I'm mistaken for a Mexican so that's cool lol.

[–]remyseven9 points10 points  (0 children) | Copy

Reminds me of Phil Demers who is fighting MarineLand. He got threatened, intimidated, lost his job, and is currently trying to fight them in court but MarineLand keeps stalling. Illegally stalling, because they know Demers can't afford to have a lawyer for years on top of years, let alone a good one to combat their billion dollar industry. You can hear more at Joe Rogan's podcast

[–]kellykebab4 points5 points  (0 children) | Copy

And they won't kill those who fucked them. Thus they get what they deserve.

Interesting perspective there.

[–]Sdom16 points7 points  (1 child) | Copy

And thank God people don't do that. It sounds satisfying at first glance, but you don't want to live in a society with no non-lethal dispute resolution mechanisms.

What would fix a lot of this bullshit pretty much instantly would be to start prosecuting executives for fraud when things like this are done. Even if you don't get that many convictions, just the serious, legitimate threat of prosecution is enough to make most white collar sociopaths shit their pants.

[–]rakov5 points6 points  (0 children) | Copy

...or they would just never get caught and bribe legal institutuions, while also framing innocent people who got in their way.

[–]eddiae2 points3 points  (1 child) | Copy

the big boys 100% expect you, you just show up on 1% of the clients they fuck over, so you're a very affordable loss,there is no karma and you dont make them regret anything, dont think for one minute that they lose sleep over you...

[–][deleted] 4 points5 points  (0 children) | Copy

The lawyers for them bitch and whine like I do. But you may be right. What they settle for or on occasion lose at arbitration, may be an entirely acceptable cost of doing business.

I really don't care, I get paid, I get paid a lot. I'm happy so far.

[–][deleted] 2 points3 points  (4 children) | Copy

"And that the people fucked over won't show up and righteously murder the scum who fucked them over, killing the people who fucked them over, their friends, their family, and everyone else in the business."

To bad vendettas like this are illegal then again the big boys can hire lots of goons too, so its for the best. Your advice about lawyering up is sound.

[–][deleted] 20 points21 points  (3 children) | Copy

Legal, illegal, it's about what you can get away with. That's how the big boys rationalize it. Good, bad, right, wrong, fuck that noise. It's a matter of whether or not you get caught.

Morality is for the small people. To keep them under control and limped dicked for their prison rape pounding.

[–][deleted] 7 points8 points  (0 children) | Copy

Yup until the "little" guys find a leader (usually a member of a fallen elite/alpha* or aspiring elite/alpha* that hit the glass ceiling) and form a "gang" and comes looking for payback. That gang can take many forms from a street gang, union, family clan, all the way to revolutionary movements and terror organizations. At some point people will step outside the law if pushed too far. Business people are their own worst enemies.

We both know morality, laws, courts and the police are there to protect the powerful and give the illusion of fairness to the masses. IF things go to far though the system crashes. Given my training, I can handle a system crash of no cops, courts and vendetta. I under no illusions that vendetta system would suck for all. I hope the illusion lasts a few more years.

.

*alpha in the general sense not PUA/TRP sense. Fallen elite/elites with a glass ceiling: See Castro, Che, Mussolini in his early days, Stalin, Lenin, Any of the US revolutionary war heroes (Washington, Handcock, Adams, Hamilton etc...) certainly hit the glass ceiling within English/Colonial society and were pissed about it. Almost all of them could be considered Alpha and dangerous as hell.

[–]oNodrak0 points1 point  (1 child) | Copy

I feel like not enough people understand this, and hold the 'law' and its 'enforcers' to certain godlike persona's of fairness.

[–][deleted] 1 point2 points  (0 children) | Copy

They do. It's quite sad how people demand absolute and infallible morality. Some line that can't be crossed, blurred, or cut. But there is no line. There is only what you can get away with. And when you can get away with it, there are no rules. The lesser minded people would tell you that such thinking is that of a psychopath, but if you think back on most great historical figures. They were psychopaths to one degree or another.

When the stigma of "psychopath" has been used for people who refuse to accept arbitrary, pathetic, and unproductive barriers and boundries. It's best to be a psychopath, and everyone be sheep.

God is dead, long live the machine. And the machine has no care.

[–]rpscrote0 points1 point  (1 child) | Copy

That no law firm will step up to take them on (even when there is an arbitration clause)

Where the hell do you live that this is true? Plaintiff firms would be salivating at a good breach of contract case where the defendant has nice deep pockets. Hell, some of em even might take it on contigency. Arbitration challenges fail in the vast majority of cases (provided it was an attorney written arbitration clause and not some one copied off the internet)

But people think they can do things cheap, skip the lawyers, and then rationalize their fiscal rape

100% true. For a huge contract its just common sense. Where it gets tricky is those small/midsize contracts where the legal fees would eat up a good chunk of the margin. That's where you just have to assess the risk level and make a decision.

[–][deleted] 0 points1 point  (0 children) | Copy

Not every Plaintiff's firm wants to take on cases where the party expects a low rate on contingency (I only collect 20% on arbitrations but I make the client's front expenses and also provide me with a cost retainer for my time if they fail to properly finance the arbitration [got the approval letter from the State Bar]). Most firms want 40% and nothing less, plus an expenses retainer, and this makes most collection efforts impossible.

Additionally, not every case is a clear case of breach of contract, and not every breach is sufficiently material enough to be actionable. There's little point in challenging arbitration clauses nowadays unless the cause of action alleged is a public policy related one and even then that's a tough road to hoe and most company's will remove the matter to federal court and that gets way more complicated.

On small and midsize contracts you are quite correct, it's why I don't bother with anything less than $80,000, because quite often there is a waiver of attorney's fees and the clients don't want to come to reality that they are fucked and should have had an installment clause for payment where failure to pay was considered a material breach that released them from the duty to perform (failure to pay is not always considered a material breach, it's quite complicated).

Also, if you can, depending on you business. Get a factoring company for B2B invoices to help reduce your risk.

[–]putinbusch0 points1 point  (1 child) | Copy

If you ever come to Australia. I wanna have a beer with you. You seem like a fucking funny bloke to hang out with.

[–][deleted] 1 point2 points  (0 children) | Copy

Was there many moons ago as a ten year old. Got to snorkel near the Great Barrier reef, go to a Wallabea (spelling I'm sure) petting farm, and saw all the massive crocs in some of the zoos. Will definetly go back one day when I have kids, and also stop on the Big Island of Hawaii for a few days of scuba diving.

I can be rather funny, but I also just say things in an absurdly extreme matter that leaves most people going, "wtf" and I think their only choice is to laugh or be left terrified. Most lawyers hate talking to me when they try to stand up on their faux high horse.

For grins and giggles I was at a mediation and I looked at my client while pointing at opposing counsel and said "you are not allowed to disembowel their attorney and strangle him to death with his own intestines." The room went quiet and the other attorney went a little white. Granted delivery is everything and I said it in a matter of fact tone.

[–]rossiFan0 points1 point  (4 children) | Copy

This is why I love doing business in Mexico City. Someone fucks you over? Blow them up. The Federalis can be bought off very cheaply.

NOTE: I've never done business in Mexico City, and I've never blown anyone up. But... it is how it's done down there.

[–]harsheehorshee9 points10 points  (2 children) | Copy

"This is why I love doing business in Mexico city" "I've never done business in Mexico city" 2016 most pointless post, rated #1 biggest time waster, #1 useless statement

[–]rossiFan-1 points0 points  (0 children) | Copy

And yet, you read it. Get over yourself.

[–]BradPill1 point2 points  (0 children) | Copy

They also blow each other up before doing business - then they take over your business. Makes you kinda paranoid - and probably drives you into their world...

[–]chokobomaster56 points57 points  (1 child) | Copy

Now this is a very good post, not like the other posts recently. Thank you for this, good read.

Now let me go out there and be like Tim.

[–]I_HATE_GOLD_2 points3 points  (0 children) | Copy

seriously good fucking post. He got gold and i aint even mad about it.

[–]CryptoManbeard24 points25 points  (4 children) | Copy

Funny because I thought this was a metaphor for dating. Some hot girl who's a 9 wants in a relationship with you. You kowtow to her every request because she's so amazing. She has power over you, she can fuck you over.

Meanwhile if you have a pool of women that you can pick and choose from, she doesn't have that power. She pulls some shit and she's done.

[–]Senior Contributordr_warlock12 points13 points  (0 children) | Copy

She will fuck you over in this scenario. It's in her nature. There's also no social consequence for doing it (as a female).

[–]Endorsed ContributorClint_Redwood[S] 14 points15 points  (1 child) | Copy

I think it's mandatory for guys to fuck and stay strictly FWB for at least 20 girls before they ever start a LTR.

You literally are oblivious to how girls are, what you want or what you need till you have real life experience with them. No amount of TRP reading will prepare you for LTR, it's learned through experience, not textbooks.

[–]dracolius0 points1 point  (0 children) | Copy

Or reversed-- a girl trying to snag a top-level man vs. farming a bunch of betas. The metaphor fails a bit at the part where the girl simply does both, but she only has so much time and has to choose how to spend it.

[–]FAPSLOCK18 points19 points  (1 child) | Copy

i think this is the plot of Horrible Bosses 2

[–]Endorsed ContributorRed_August40 points41 points  (2 children) | Copy

Cash flow is king especially for SMEs as they are extremely fragile. The reality however is that although the entrepreneur is keenly aware of this, the diversification of your revenue sources is very much part of the initial challenge of growing a business up in volume.

[–]Endorsed ContributorClint_Redwood[S] 27 points28 points  (1 child) | Copy

the best business plan is one you can start on the side of your main income source. Kevin and his wife fucked up by throwing all their trust in the new start up.

You can still take on the risk of entrepreneurship without exposing yourself to the degree that Kevin did. It's a risk the non the less, but it can be minimized with good planning.

[–]drqxx53 points54 points  (15 children) | Copy

Excellent post. As entrepreneur that's about to celebrate 12 years in the black I can attest to your statement. It is dog eat dog world. The free market will eat your lunch if you let it. A good policy for me has been.

Payments are due when services are rendered.

I know it depends on what you sale. In my industry I just demanded or walk away. No net 30 for anyone not even the fucking pope.

Fuck you pay me!

[–]Endorsed ContributorClint_Redwood[S] 54 points55 points  (14 children) | Copy

Coders, webdesign, IT guys are the best at getting payment.

Oh, you didn't pay me for my work? Aaaannnnddd now your website is gone.

[–]drqxx41 points42 points  (0 children) | Copy

Didn't want to pay for this IT work now you have all your information encrypted and I seem to be the only one with a key. Ill take my 5000 in cash and I'll give the Private key to you new IT guy.

Oh he paid. The look on his face. Bwhahahahha

[–]wanderer779 21 points21 points [recovered] | Copy

I used to know a guy who ran an electrical contracting business. If people didn't pay he'd get them on the phone and have the following conversation:

"where's my money?" "excuse excuse excuse." to electrician standing nearby, said so customer can overhear: "go to xx main street and rip out all the conduit" "ok, ok, we'll send a check today"

[–]BradPill4 points5 points  (2 children) | Copy

Unlawful - he will have to pay/repair all the damage that comes with it. The moment he installs it, he can not remove it. If his client knows that, he can sue his pants off (well, maybe not in the US - but in many other countries).

[–]wanderer7794 points5 points  (1 child) | Copy

I have no idea if it was legal or not but it was a well-known tactic of his. I don't know if he was bluffing or if so if anyone ever tried to call it. Could be a thing where you lose the battle and win the war. You have to pay damages, but everyone else in town hears about it and knows you don't fuck around.

I doubt he would have done it if it was a GC he had a good relationship with. I also doubt most of the more respected and established guys pulled stuff like this. I think most contractors, although they will try to cut corners here and there, don't get in the habit of just stiffing their subs or else they'd eventually end up working with shit outfits and doing shitty work which is going to kill you in the long run.

[–]BradPill0 points1 point  (0 children) | Copy

I understand - it sounds cool from his side (and I hope he did do so), but, as said, in many (European?) countries he would be liable: the legal concept being, he 'delivered' the goods and/or work, so it is now owned by the client. Also, he might even be tress-passing, as he was not invited by client on the premises.
It sounds highly unfair/unjust, but the law protects the buyer - more than the business - it is your job/duty to verify (upfront) if client can pay - and then to make sure there is a paper trail: contract, deposit, delivery, inspection, acceptance etc. Still, no guarantee, at all, because if client is mal-intended, he can bury you in legal work - the contractor having to go to court, proving everything etc.

Kevin (in this 'case'.... ahum) didn't do anything to protect himself - so they took him to the cleaners - another 'muppet', so to speak.

[–]blacwidonsfw35 points36 points  (7 children) | Copy

I made a stock algorithm site for a guy for pretty cheap and he never paid me. I think he was just going to pass it off as his creation to whatever gods he served. I was naive and in college so I expected payment after I completed the work.

After he clearly wasn't going to pay I committed some code to the repo that fucked up the results. Hope he lost a lot of money using those shit algorithms.

[–]stemgang4 points5 points  (6 children) | Copy

Let's assume you are savvy enough that this confession cannot be traced back to you IRL.

[–]blacwidonsfw14 points15 points  (0 children) | Copy

Let's assume I would care if he found me in irl or if I would tell him to fuck off in person

[–]rpkarma1 point2 points  (1 child) | Copy

Liability would be hard to prove considering contracts rely on consideration given, of which none was.

[–]stemgang0 points1 point  (0 children) | Copy

I committed some code to the repo that fucked up the result

That's what we call a confession. The guy is definitely liable. The real issue would be proving damages.

[–]Machismo010 points1 point  (2 children) | Copy

Just what the hell would he do? Sue? You're funny.

[–]stemgang1 point2 points  (1 child) | Copy

Sue someone who sabotaged his business? Of course. As long as the target has money, a lawsuit is attractive.

And if our programmer counter-sues for non-payment, the worst that would happen is the client is ordered to pay.

That payment could be small compared to the damages claimed from sabotaged software.

[–]-TempestofChaos-0 points1 point  (0 children) | Copy

Old post, but suing someone with little money is hilarious and makes for a fun news story.

[–]the99percent11 point2 points  (0 children) | Copy

But honestly though, there aren't many million dollar IT Contracts floating around. So it's penny stocks you are talking about.

[–][deleted] 116 points117 points  (11 children) | Copy

This is an INSANELY good post. I myself have no knowledge of running a business and it's an aim: But these are some valuable lessons. Making this post to say it's a fucking good read and as a reminder for myself in the future.

[–]sundaybrunch119 points10 points  (0 children) | Copy

yeah totally. I could have been business raped with something like this. OP probably saved me a shit ton of money and pain.

[–]fearandloath86 points7 points  (3 children) | Copy

Does anyone know any books about business that are like this (not the Art of War or 48 Laws of Power since I've read those)? Maybe they are mixed in with life lessons (from relationships like the Laws of Power to finance and investing) or are just great business books about stuff you don't learn in a textbook etc.

EDIT: a word.

[–]ITS_JUST_A_WANK_BRO15 points16 points  (0 children) | Copy

How to Get Rich by Felix Dennis. He is worth 400Mil and talks about screwing people over and redpill stuff. nothing else like it. Famously he spent over 100mil in one decade on women and drugs

[–]Adjustify-2 points-1 points  (1 child) | Copy

Maybe the 4 Hour Work Week?

[–][deleted] 18 points19 points  (0 children) | Copy

I'm literally flinging my shit at the walls at this post.

[–]1foople17 points18 points  (1 child) | Copy

Good job not mentioning any specific company. To often people just memorize the bad guy and ignore the lesson.

[–]Endorsed ContributorClint_Redwood[S] 15 points16 points  (0 children) | Copy

thanks.

It took me a while to articulate it in a completely immoral stance. I very much like contrasting the entire spectrum of morality in TRP instead of focusing on just the black and white answers. I look at it like Star Wars vs Game of thrones. Game of thrones is a much better depiction of life than Star Wars as it explains why people are shitbags, even if you don't like them, you can still understand their point of view. Cersei Lannister, deplorable human being, but an extremely protective and caring mother. You can hate her, but you still get why she is the way she is.

Painting myself as the bad guy and having a few plot twisted really helped separate it from the classical "Evil corporation vs underdog" story. Not letting the reader latch onto one aspect as the point of view and understanding behind the actions constantly shifted.

I think it's a method of writing I'll be diving into more.

[–][deleted] 36 points37 points  (4 children) | Copy

My father was in the music industry, specifically sound engineering, mixing and mastering.

He told me very early about stories of him being ripped off by artists. The way he fixed this was by never giving the final masters out without full payment, seems obvious but it's not.

The artists use every excuse to not pay. Classic one being they'll be able get the money only after they get the masters as they need that to raise money! My dad never fell for it and had to hold onto masters without the artist ever getting it sometimes. Was easier than chasing guys down for payment.

It's strange how people don't respect small business owners. Nobody expects to walk into wal-mart and leave with free stuff. But people size up small business owners and try to extract what they can get, probably because they see they're an individual like them.

[–]Endorsed ContributorClint_Redwood[S] 20 points21 points  (1 child) | Copy

seems obvious but it's not.

This is something a lot of people don't realize. When you pour a tremendous amount of time and work into something. YOU WANT to share it. you want your customer to have it and him go, "Wow, this is fucking amazing Clint." There is something primal about it, I see it in all fields. Then people wise up really quick, like your dad, and realize that people will fuck you.

My dad never fell for it and had to hold onto masters without the artist ever getting it sometimes. Was easier than chasing guys down for payment.

We do that same thing. Oh you can pay after? Ya no, check in my hand or I'm selling it off to the first person that wants it.

[–][deleted] 3 points4 points  (0 children) | Copy

Then people wise up really quick, like your dad, and realize that people will fuck you.

Like certain of my parents' customers over the years, who complimented their work and acted all excited, and come due date the check has bounced and they act all fucking upset.

Either ask for a deposit, or make sure your work is easily retrievable, so you can have some leverage for repayment.

Due to the nature of reddit and the types that scan this sub I'd rather not disclose the type of business we're in, but I have a quick question.

We are in a business where we can easily hold onto a project that is unpaid for by the client, even if we were to return it they would need to pay someone to undo our work or complete it before the item is functioning again, so there is a low chance of Suddenly Disappointed Davids or "troll" customers. Should we ask for a significant deposit once the work has begun, non-refundable at a certain stage, or simply ask for installments? I ask because some of our clients might be annoyed (rich people) at this, but that's a risk I'm willing to take if it means a more secure way to ensure repayment in a business where, by shortage due to the nature of a project-based service, each client makes up a pretty significant portion of our revenue.

I will also await your post on installments.

[–]happyhorse_g4 points5 points  (0 children) | Copy

You say it's strange that people will screw over the little guy, and respect the big guys, but thinking more about it, it seems natural. The big guys didn't get big by carefully not treading on peoples toes. The big, big company that OP mentions must have beaten countless competitors, and gotten the best of countless suppliers to get in such a position of authority.

[–]tubameister1 point2 points  (0 children) | Copy

Nobody expects to walk into wal-mart and leave with free stuff.

Plenty of poor and middle class kids expect this often.

[–]merkmerk7317 points18 points  (3 children) | Copy

I mean you should still go to court

Hell I'd go to the news.

"Local business man feeding a family of 5 forced to bankruptcy after <HUGE COMPANY> refuses to pay agreed upon money, more at 6:30"

Sorry but just rolling over and letting yourself get fucked is as blue pill as it gets

[–]MartialWay10 points11 points  (1 child) | Copy

This actually happens so often it's not newsworthy.

[–]TRPhd8 points9 points  (0 children) | Copy

News companies are still corporations. If there is any chance of losing ad revenue or eyeballs....

[–]sir_Preacher19 points20 points  (1 child) | Copy

He spent the last 4 years going through college to get his business degree, he got married to a lovely girl, they had a kid so she decides to be stay at home mum... save up enough to finally start his own business. He’s got this shit on lock.

This was Kevin's first mistake:

Never give out personal information, they will always be used to manipulate you.

Communication between business partners must always be kept professional and focused on the business. No need to talk about your family and weaknesses and insecurities.

They will always be used to manipulate you.

[–]BradPill-1 points0 points  (0 children) | Copy

4 years of bus. degree - and they didn't teach him the basics? Sounds like that college ripped him off first...

[–][deleted] 9 points10 points  (0 children) | Copy

Thank you for your post. This reminds me of a class project I was a part of back in high school that was really the first time I understood how the game is played.

Our social sciences teacher stated we would learn how treaties worked. He had us split into three teams, representing countries, and we each drew up treaties and negotiated with the other countries. Then he walked over to one country and whispered something to them. Their next turn, they broke their treaty with us and crushed us, symbolizing we had our entire country wiped out. They took our land, our resources, and killed everyone. Everyone was up in arms and he essentially said, "Now you see how treaties work." It was an epiphany moment for me.

[–][deleted] 25 points26 points  (6 children) | Copy

It's similar to when people have sold off their patents for tools to large companies who pay peanuts while being able to generate millions off the back off it.

Sears Craftsman have done it to many, many people. Is it Unethical? Yeah probably, but what are you gonna do?

Another good method of assuring payment in a service is to provide it in installments which need to be paid off before moving to the next step.

Say if I was an Electrician, I'm not going to sign off any electrics or install a fusebox for a house rewiring until you pay or I'm coming back and tearing all the wire out!

[–]Endorsed ContributorClint_Redwood[S] 22 points23 points  (4 children) | Copy

Another good method of assuring payment in a service is to provide it in installments which need to be paid off before moving to the next step.

This is called the 30/30/30 deal for us. It is standard for any new company we do business with since the fall in 2008. I'll be making a post on it.

[–]JakofClubs18 points19 points  (1 child) | Copy

I had a boss in construction that did the 30/30/30 as materials are often about 30% of the total job.

  1. He would buy the materials and expect to be paid for them (at about a 10% markup). The customer can just take the materials and walk away. Nothing lost. If the customer doesn't pay, at least you have the materials.

  2. Then he would build the project in the shop and expect to be paid. The customer can just take the product if they want. If they don't pay; you have the finished product and can try to sell it.

  3. Do the install and expect to be paid. Worst case, is you're out the profit, but the materials and labor are paid for.

[–][deleted] 2 points3 points  (0 children) | Copy

So separate the installments given the steps in the process of development, that makes sense.

I'm getting the gist of installments is to just have a guarantee of breaking even if at any stage you get fucked over. Now, identifying what these stages are is what I'll wait for Mr. Redwood's post for.

[–]thInc6 points7 points  (1 child) | Copy

But what about the other 10...

[–]Endorsed ContributorClint_Redwood[S] 24 points25 points  (0 children) | Copy

As my late grandfather would have said,

"Stop asking so many goddamn questions and get back to work."

I think it might have something to do with it being easier to say than 33/33/33.

[–]Bambam607 points8 points  (1 child) | Copy

This reminds me of a certain business relationship in Mad Men (SPOILER AHEAD). Sterling Cooper Draper Pryce had about 75% of their advertising business invested in Lucky Strike cigarettes around the 60s. Everything was hunky-dory until the rep from Lucky Strike dropped SCDP because someone in the art department wouldn't sleep with him.

While this wasn't a blatant con from Lucky Strike, it's a prime example of how placing all your eggs in one basket can burn you. This example stems from some shithead canning your advertising business because he couldn't fuck one of your employees. As thoroughly explained in this post, the worst thing you (Kevin) can do is be naive.

[–]Senior Contributordr_warlock3 points4 points  (0 children) | Copy

The Lucky Strike executive also attempted to AMOG Roger Sterling in an emasculting way any chance he had just because he wanted an ego boost, just because he had the power to do so.

[–]ilostmyredditaccoun9 points10 points  (1 child) | Copy

I know i'm going to get downvoted into oblivion for this, but this story is very old and from the 70's. The companies OP is referring to are Sears and Craftsman. They were notoriously guilty of doing this to new suppliers in the 70's and 80's. Nowadays, its pretty common practice to ask for the cost of time and materials up front... for 2 reasons. 1. It acts like a show of faith. 2. If they decide to back out of the purchase later? You're covered on all your costs.

Sure you might have a bunch of junk laying around that nobody wants, but you've lost nothing. However, it's still a great post.

[–]Endorsed ContributorClint_Redwood[S] 4 points5 points  (0 children) | Copy

I've seen it happen twice in the past 10 years. Multiple people in the comments state they've seen it constantly to infrequently depending on your industry.

People being fucks hasn't changed in the last 30 years just like woman's nature hasn't changed.

[–]aDrunkenWhaler14 points15 points  (1 child) | Copy

This is brilliant, thanks OP! More posts like this please! If 10% of TRP had this type of content instead of laments about women it would be a game changer.

Mods, I love you, I really do, but when is that business section coming?

[–]Endorsed ContributorScholarInRed5 points6 points  (0 children) | Copy

The mods have more than enough to do around here. You could just start a sub yourself. It would do better as a whole sub rather than a sub-section of an already large sub. You have a few other upvotes, maybe they will be your fellow mods.

[–]Sdom18 points9 points  (0 children) | Copy

YES. Yes, yes, a hundred times yes. My buddy's family owns a building company and he was the first to clue me in to these tactics. This is almost expected in the construction industry.

My buddy had a couple of tactics to flush out the bad actors. One was that he'd tell them he needed certain written guarantees, and would observe his reactions. If he didn't like the reaction he got, he'd just pass on the job.

Great post, I hope to see more!

[–][deleted] 5 points6 points  (0 children) | Copy

Very helpful. I'm hoping to start a business soon and the real world knowledge and experience from the field is sorely needed. You don't get this kind of shit from the classroom.

[–]animalpoo4 points5 points  (0 children) | Copy

Great post and I'm looking forward to your future posts.

In Kevin's scenario he should never have placed a charge over his house to begin with. Just take the expensive unsecured bridging loan as it will save you a headache/ stress from your creditors.

Unsecured > secured. The more expensive the money the bigger the risk for funder. The cheaper the money the lower the risk.

Always negotiate a stage payment from customers. 50% on day one ; 25% halfway point and the final 25% when they're happy. It gives them power to dictate if the project is to their standard, whilst allowing yourself to reduce risk. The same should be applied to your vendors.

Another case to watch out for is when an established competitor attempts to sue you for x y z reason. They're only interest is to deplete your cash reserves by dragging you through court.

Final thought; have multiple shelf company's (your accountant should at least). If your company was to go bust you can reopen with an established LLC or LTD - also the rate of lending is much cheaper after 3 years (you don't even need to be trading for the full 3 years).

[–]1egoisenemy4 points5 points  (1 child) | Copy

I work for an engineering company currently. I don't know why Kevin would so stupid as to not get at least 1/2 the money upfront. No work is ever done in the company unless 1/2 has been paid in full; then the other half is paid once the work is done. Isn't this just common sense? This is just a side point and doesn't detract from your main points, points that I agree wholeheartedly. I just didn't realize business was ever done upfront like this.

[–]Endorsed ContributorClint_Redwood[S] -1 points0 points  (0 children) | Copy

Some industries don't have the luxury of money up front. It's not always the case but it can be the case. It could be more complicated like I helped Kevin out by letting him rent a building of mine. Invested a bit of money into his company to start him up but the fine details of that would detract from the main point.

[–]azrise4 points5 points  (1 child) | Copy

This is somewhat confusing to me. I'm guessing things work differently in the United States, but in my country this type of situation is very easily avoided by demanding what we call a "signal fee" whereby the buyer needs to pay from 30% to 50% in advance when he orders the service. Some businesses even demand 100% full payment in advance.

There is no business owner in my country that will risk being left empty handed like that by taking someone's word that the payment will come in the end. It makes absolutely no sense.

[–]Endorsed ContributorClint_Redwood[S] 1 point2 points  (0 children) | Copy

It happens, you'd be surprised how dumb people are.

[–]MoneyStatusLooks 5 points5 points [recovered] | Copy

I work in the gambling industry and deal with approx 20-30 different companies. Most pay me a small percent, my biggest client pays me approx 30%, my second and third biggest about 10% each, then the rest pay me a small % each.

A lot of the other companies in the industry stick together, so if someone gets fucked by X company, we all decide to boycott that company and it essentially means no one sends them business and they get bankrupt. We have caught several companies shaving (stealing) from us, so have completely blacklisted them. So we are basically a self regulating industry and don't accept getting fucked over.

[–]Archange_1 point2 points  (2 children) | Copy

This self-regulation is close to collusion or cartel behaviour, which may or may not be prosecuted by the government.

[–] points points | Copy

[permanently deleted]

[–]Archange_2 points3 points  (0 children) | Copy

In my industry, financial services, some brokers are major troublemakers. Usually not the whole company but individuals or teams. So after a broker screws up big time, you refuse to deal with him any longer, you talk to others about this screw-up and many others stop dealing with him because, well, he also screwed them up. Thus the broker loses 75% of his deal flow in 1-2 weeks. Then the bad broker complains to the regulator about being shut out of the market by colluding firms, regulator checks the deal flow and hands out a small fine to all those who boycott him and orders him to be reinstated. Finally the legal department of each company stages a meeting in which we are warned against collusion and asked to stop propagating rumors about bad behaviour.

The shitty merry-go-round goes and goes and goes. Lucky you being able to warn your associates.

[–][deleted] 8 points9 points  (0 children) | Copy

Excellent post.

One of the key aspect so strategy in any part of life is the question of what you can do without any consent. What can you do regardless of what the other wants you to do and what can you do regardless of what he tries to prevent? Always ask: "Do I need anyone other than myself to make this action go through?" If you need anybody else to make it go through, you need to start asking questions about how much leverage you have in the situation.

If there's mutual reliance on the project, or if they rely on you for something else that's necessary for them, or if they fear some sort of revenge you can realistically take on them, then you're well off. Too many people don't get that. They make their decisions based off of what they can ask permission to do or trust others to be honest about. These guys get so unbelievably screwed over once the other side's self interest begins to guide them. Leverage can mean many things from tangible advantages to social ones, but regardless of what form it takes leverage is EVERYTHING.

[–]BradPill7 points8 points  (2 children) | Copy

So.... - Kevin goes into a $1M deal without contract? Without legal advice? - Then he has to buy all materials himself, without any deposit? Again, no legal advice? - No contract means no delivery and inspection-dates? No third party inspection in case parties might disagree?

Also, Kevin is allowed a 30% (or 3%) increase - without ANY objection or compensation by or for the buyer? All bells should go off, because it shows they never intend to pay in the first place.

And, although you try to make a point, a big part of it negated by the fact that you can't keep track of your own digits: was it a $100K or $1M deal? Kinda of big difference (a factor 10, just in case).

Good effort, but....

[–]BleachedWhale0 points1 point  (1 child) | Copy

And for Kevin:

Bullpill advice would be, take them to court, try to get your money out of them.

But for Tim:

Tim can fall back onto his other accounts to support his business and life style, and have the money to take me to court in the process.
Tim, can’t be fucked with, because Tim has abundance.

You can't be any more Bluepill than not enforcing a legal contract you have.
This post is mindless rhetoric.

[–]BradPill0 points1 point  (0 children) | Copy

Yeah.... OP calls it BULLpill.

He touches on some good points, but...... (not sure why it got upvoted so much though)

[–]tonyfaulkner5 points6 points  (0 children) | Copy

It is truly intriguing how much business relations and sexual relations are similar to each other.

[–]Raikkonen7162 points3 points  (0 children) | Copy

I worked in sales, this post is so true. Law is slow, law between countries (if you are exporting/importing) is even slower, so you can't rely on law most of the times. Don't be trapped by your customers. When in doubt, ask for advanced payment.

I have to thank you op, i always had the rule of askind advanced payment for new customers, but maybe i wouldn't do it with some big and reputable customer. No doubt i will undervalue a company from now on, be it "The grocery of Sam" of the fucking Amazon.

[–]Neverd0wn2 points3 points  (1 child) | Copy

This has nothing to do with spreading your eggs, more with negotiating a good contract.

[–]BleachedWhale1 point2 points  (0 children) | Copy

The rule being taught is: if you ever get a huge new customer that would treble your sales.. Don't do business with them.

I agree with you. Kevin was a moron legally. Nothing to do with eggs in baskets. If he had protected himself properly, he would have made the wise choice.

[–]aBitClearer2 points3 points  (0 children) | Copy

Very well-written post here OP.

I've owned a small and very profitable business for 15 years. We have had a near 70% drop in revenue over the last 7 years, but I make almost exactly the same as I did when things were at their best.

How can I do this?

*1) All new business is paid in advance thru company check, wire transfer or by credit card. I'd rather loose 2.5% on CC transactions than take bad debt any day!

*2) All N30/45/60 customers are held to terms, and if they fail to pay on time, new shipments must be paid for in advance.

*3) We screen out the catfish who are on credit hold with our competition. These SOB buyers are liars, who dangle "impressive" opportunities, but really seek to use our cash to pay their preferred suppliers, then take their sweet time paying us. I can always smell these types coming, and this sense serves me well in preserving my companies assets (cash, time, resources, and capacity).

Cash is king, and whoever has the cash makes the rules.

[–]thetotalpackage72 points3 points  (0 children) | Copy

Business can be ruthless. Here's a true story for you as it relates to my business. Been in biz for 10 years. Company shot off like a racehorse and within a year I had close to mil in sales and was taking home close to $200k. But as the great recession hit, things slowed down drastically.

I did however have a client who was placing a lot of biz with me and I was making in-roads with his parent company to get business from all of their other reps. I made the mistake of telling him. Well, slippery fuck that he was, and wanting to remain my top client, he broke up the work I was doing with is parent company. HE wanted to be the gatekeeper of referrals that came my way. Real scumbag move. Well he did give me a few referrals, which kept me from blowing him up But I could have done so much more on my own volition.

Fast forward to this past November. We're at a bar and he comes out from the bathroom and sees his assistant making out with me, freaks out and grabs me by the throat. I stand up and smash him in the face. Client is lost of course. HE proceeds to blow up the referrals he sent my way and I'm left trying to replace my income. The guy was a c*cksucker so I feel great about smashing him, but as it pertains to this moral of the above story...yes, do not put all of your eggs in one basket.

[–]1Snivellious2 points3 points  (0 children) | Copy

An exceedingly relevant comic from Scott Adams (who spent years in the trenches with this sort of thing): http://dilbert.com/strip/2008-06-13

Even a company that's a bit more on the level, that intends to pay you, can completely fuck you over. Maybe their purchasing department takes three months to pay an invoice normally. Maybe they're tight on cash, so they decide to just not pay you until the year end reports are are done. Maybe they want to chisel you down a few grand at a time until you accept anything just to get paid.

Regardless of their reasons, a company several times your size can fuck you over at will. Either have alternative lines of income, or ensure that you don't deal with people you don't outweigh.

[–]Freiling3 points4 points  (1 child) | Copy

Thank god for stuff like this.

Hey, TRP - the world isn't about women!

[–]taoofmojo1 point2 points  (7 children) | Copy

Non of you heard of a promissory note?He fuck up by not getting one. What was he learning in business school?Post makes me mad

[–]JJonesWisco5 points6 points  (4 children) | Copy

I can attest to Mr. Redwood's reply here. I lawyer it up for a living. Sure, a promissory note should help, in theory. However, the lawyer's fees will eat up any recovery you gain by suing. Don't even think about suing someone for less than $50k. I could probably get it done for $20k of my time, if it's a simple small deal. If you're lucky enough to get the whole amount, you'll be paid over time. My fees, however, have to be paid in full before you ever see any money from a judgment. So in addition to the $50k that you're out, you'll have to pony up substantial real cash just for the privilege of being able to collect that $50k in small increments over time. On top of that, you'll probably have to deal with depositions and production of documents requests that could take up most of your time away from your business of generating paying clients. Are you starting to get the picture? Sure, you should have a promissory note. You better hope you never need to use it though.

[–]Endorsed ContributorClint_Redwood[S] 2 points3 points  (3 children) | Copy

A lot of people don't realize this. In this situation you either roll over and take it or spend more money to get your money you are already owed. A lot of times the profit you would have made is eaten by the legal fees and it's not even guaranteed you will win till the court hearings.

Usually it's cheaper to just eat the lose and invest that time, money and energy into a contract that will pay you.

[–]JJonesWisco1 point2 points  (1 child) | Copy

Correct. Yes, you can always sue someone. It is rarely a profitable part of your overall business venture, unless you are a lawyer, of course.

[–]Endorsed ContributorClint_Redwood[S] 9 points10 points  (1 child) | Copy

promissory note

Ha, don't bank on it. Corperation's can run circles around you with their legal team. They can dumb thousands upon thousands of legal papers on you that you must go through. If you are one guy, or a start up, you are effectively trying to win WW2 as a toddler.

Legal papers can help, you can and should get a lawyer. But, for the most part, you will lose no matter which way it goes. Contracts don't mean shit when vendors are demanding their money and you can't pay them. They don't give a shit about your problems, they want their money or you will soon find yourself in multiple court appearances.

Don't bank on the law, bank on good business practice so you never have to worry about the law.

[–][deleted] 1 point2 points  (1 child) | Copy

This might be a silly question: How did thr big corporation in this situation benefit? Seems like the little guy just got fucked but I missed how the corporation won.

[–]Endorsed ContributorClint_Redwood[S] 1 point2 points  (0 children) | Copy

They got 60k worth of work for free.

The company in real life that got fucked for 1 million?

The corporation got 1 million dollars worth of work for free.

[–]Darkone061 point2 points  (0 children) | Copy

This is a major theme in Mr. Robot.

The company Elliot works for only has one major customer who is 85%of their business.

When shit goes wrong and they start looking at competitors all hell breaks loose for that company.

This is accelerated by the fact they have a disgruntle employee working on their top project, that is deliberately sabotaging the project.

Moral of the story: Dont rely on just one person or client, diversify.

[–]trp_dude1 point2 points  (1 child) | Copy

Yup. This happens a lot more in other countries.

Research in Motion did something similar to Nokia - they wanted to slow Nokia down from coming into the smartphone market, so they pretended that they would license their software to them. They kept on sending them buggy software, and Nokia ended up with tens of millions of dollars of equipment they never got to sell.

[–]Kardlonoc1 point2 points  (0 children) | Copy

I am self contracted nowhere near the amounts of the post listed...however things really did change for me the more and more jobs from different cilents I brought on.

I was able to raise prices and be a lot more confident. I was able to say "fuck off" to toxic places and do things my way more often. If some place didn't like me personally, fine, Ill go some place else, no skin off my back.

To live with multiple sources of income and work is really nice. If something fucks up somewhere you don't even need to bat an eye you have everything else going.

Now...fucking imagine the typical job. Yeah its scary for a lot people, espeically older people, to have one employer, one source of income and one job that you have speically trained for. Its hard to even think what happens if you get layed off one day from that job and so the mentality becomes one of "ill do whatever it takes to keep this job" even your large efforts go unnoticed and you no longer can tell the forest from the trees.

Its the wrong attitude to take. In capitalist America you are expected to be looking how to get a pay raise, even if that means quitting and making a company under yourself. Going around to several places is the norm nowadays as well, long gone are the days of career company.

That is...you should have the mentality of getting a promotion rather than he mentality of what it takes not to get fired.

[–]TheCarm1 point2 points  (4 children) | Copy

So question then. I am starting up a company. We have one product and we want to place it into larger stores like publix, target, along with smaller local shops. Problem im seeing now is that if we get 5 companies willing to buy our product. Thats 20 percent of our business each in a void. How does a startup selling a product (not a service) go about finding enough buyers to ensure not one is over 10 percent? We are so early stage its a guaruntee that will happen

[–]Endorsed ContributorClint_Redwood[S] 1 point2 points  (3 children) | Copy

What you are referring to is distributors, not clients. Your clients are the people that will buy your product directly from your distributors.

I know a guy who started a business selling products in the 80's just like you. circa 2005 he sold for 150million. I asked him about his thoughts on distribution and selling his product. He said distributors are a pain in the ass to deal with. Especially walmart. He said to build your name up as much as possible till you can sell directly to your customer via website. And you gain 100% profit instead of a distributor taking a chuck of it.

Distribution is a necessary thing but if you can, drop them as soon as possible. Unless your product is something that turns a better profit through distribution. His product was like the top tier of his industry and everyone knows the name, he didn't need distributors.

[–]TheCarm0 points1 point  (2 children) | Copy

Well I can tell you Im selling workout supplements. Its way cheaper and faster to have it produced and distributed. But i understand, as soon as i can drop them i will do it

[–]Endorsed ContributorClint_Redwood[S] 1 point2 points  (1 child) | Copy

To give you a time frame though. The guy I cited built his entire company around high quality product and amazing customer service. Bar none, they have the best service I've ever seen of a product. It took him 15 years to build a loyal customer base and drop his distributors.

I think supplements might be to competitive to follow his business model. if you can pull it off great but you will probably be stuck in the distribution phase for a very long time.

[–]TheCarm0 points1 point  (0 children) | Copy

I figured that. We have a unique product but there just isnt a way to get away from powerful lines of the supply chain

[–]MyFirstOtherAccount1 point2 points  (0 children) | Copy

If anyone wants the movie version of this it's Horrible Bosses 2

Edit: woops this was already said twice mb

[–]IIlllIllIIIllIl1 point2 points  (0 children) | Copy

I'm eager for your next post. I'm the son of an upper middle class magnate, and while I'm not entirely concerned, I am well aware of some of the dangers ahead of me. I only recently became aware of this when I read The 48 Laws of Power, where Law 41 states: Avoid stepping into the shoes of a great man.

I look up to you in this way. You have walked the path I intend to, and giving that experience away deserves respect.

[–]IRC Mod-Anteros-2 points3 points  (5 children) | Copy

Amazing post. People pay very good money for advice like this.

I am one of those fancy pants Consultants and can confirm the 10% rule mentioned above, if one of my customers tries to fuck me with a bad deal (like the one OP mentioned) they know that I will walk away and they will be out in the cold. This is power and it ensures a proper relationship, much like you have to maintain power in LTRs.

The concept boils down to one that is found in my personal bible: Anti-Fragile by Nassim Nicholas Taleb. In it he reminds the reader to make decisions in terms of optionality, that is: go with the choice that will allow you the most flexibility in terms of unlimited gains and limited losses.

In the IRC channel we often reference the concept of tryouts: "A tournament of plates where the goal is a LTR with you." also known as spinning plates with an LTR in mind. This allows the man to consciously decide which woman he wants to give his commitment to instead of his dick and her sexual availability leading him to ruin.

Keep these concepts in mind fellas.

Again, This was an amazing post, Clint.

[–][deleted] 0 points1 point  (2 children) | Copy

what are your other bibles?

[–]IRC Mod-Anteros-2 points3 points  (1 child) | Copy

Starting Strength is a distant second.

Note: For every hour a man spend reading about socializing he should spend 10 hours socializing IN PERSON. Experience is the best teacher.

We have a bot in the channel that answers these sorts of questions, there is also a library of interesting books but all pale in comparison to going out and making mistakes (remember to wear a condom and avoid face tattoos.).

[–]debashis222 points3 points  (1 child) | Copy

You're absolutely right here. I consult to Federal Government Contractors and getting invoices paid is the bane of my existence. Few companies honor their net payment terms, even though I'm giving them 40+ hours of my life every week.

[–]Endorsed ContributorClint_Redwood[S] 2 points3 points  (0 children) | Copy

We take bets in our office on a few customers.

Last one was net 236. I didn't win.

[–]wanderer7791 point2 points  (0 children) | Copy

This guy grew up learning about real life while most people were being told to be nice and work hard. Forget about money this is the true inequality.

[–]7Fig1 point2 points  (1 child) | Copy

Kevin would have to be a pretty special person to grab up a big order before his company is formed. Also Kevin would have to be pretty stupid to not have his materials covered up front. Look at any factory in China. You need 30% down or your work will not be started.

This whole story is avoided by not leveraging yourself on a strangers promise.

This sounds more like the plot to "Horrible Bosses 2".

[–][deleted] 0 points1 point  (0 children) | Copy

Shit, you're right. Its the whole plot of the movie.

[–]Sunshinelorrypop2 points3 points  (8 children) | Copy

So the scam is that you pay him $100,000 for a job. He does the work, you hold out on payment until he goes busto. You keep the work plus not having to pay for the job?

[–]user_none0 points1 point  (0 children) | Copy

Damn good post and it all made sense while reading through. The place where it really hit home was your bolded, "Never have all your eggs in one basket." That, is the business equivalent of oneitis.

[–]ChickenBalotelli0 points1 point  (4 children) | Copy

Thanks for taking the time to share your knowledge and wisdom. A truly useful and elevating post.

Is there any kind of paperwork that can be signed to ensure this does not happen?

-business newb

[–]Endorsed ContributorClint_Redwood[S] -1 points0 points  (3 children) | Copy

Yes and no. You can and should consult a lawyer, but it's best to avoid ever stepping foot in a court room with a corporation that is 100x or even 1,000x more powerful than you. Corporation's are capable of holding money and dragging you through legal hearings that can sometimes last years, slowly draining your savings till you are incapable of fighting them.

I prefer the preventative method(safe business plan) vs the reactionary method(court).

[–]Neverd0wn0 points1 point  (1 child) | Copy

Sure, but isn't that why there are punitive damages?

[–]Archange_0 points1 point  (0 children) | Copy

You have to be able to pay your lawyers till the final decision, which may take years because large corporations know how to play the delay game. If you stop paying your lawyers, your case drops from the courts and all is lost.

[–]ChickenBalotelli0 points1 point  (0 children) | Copy

Right I see. So even with a signed contract saying they are supposed to pay, and if not they face fines....even with a contract like that they can screw you in this way?

[–] points points | Copy

[permanently deleted]

[–]Endorsed ContributorClint_Redwood[S] 0 points1 point  (0 children) | Copy

Sometimes people have to learn the hard way.

[–]1favours_of_the_moon0 points1 point  (0 children) | Copy

This happened to me. Actually, myself and my sister. She was CEO, so she cut me out of the loop. I saw it happening, but couldn't do anything. Her babydaddy gave us the startup.

[–][deleted] 0 points1 point  (0 children) | Copy

Could someone link the second part mentioned?

[–]thieveries0 points1 point  (0 children) | Copy

Wow! Great post! As a gay male, I'm not always 100% sure why I even follow this sub. I think it's because I can appreciate the general sentiment. However, if this entire sub was generating content geared towards no nonsense business advice, I would be fucking pumped!

As I am currently in the processes of getting all my ducks in order (one could probably do that for an entire life - and there has to come a moment when you just fucking do it) - this post came at a perfect time, and I would love to hear more 'real life' accounts of things.

Life isn't all about who you're fucking, because honestly at the end of the day, you're sleeping with yourself, so you better be damn proud of what you're doing, and who you're becoming.

[–]Obnoxious_bellend0 points1 point  (0 children) | Copy

I think I know which cpg company did the raping in your example...pm me.

[–][deleted] 0 points1 point  (0 children) | Copy

I bet you forgot about Tim

Not by a long-shot, I had Tim on my radar the entire time. Question: at what age did you realize you had morphed into a misguided pussy?

[–]MartialWay0 points1 point  (0 children) | Copy

In business, the more charming and the more enthusiastic a person is, the more you should be skeptical of them.

This is one of the more brilliant things here. If I have have an instinctive like towards someone and just a gut feeling I KNOW that I can trust them...I immediately get suspicious.

The elite professional hustlers all make you feel this way.

[–]Merwebb0 points1 point  (0 children) | Copy

How about when people tells you "just gimme a guide with all the things you are going to do step by step"

[–]fakenate10 points1 point  (0 children) | Copy

Great post.

My only critique is that not paying your vendor isn't illegal. You won't go to jail for not paying vendors. You can be sued for not paying a contract, but that's a tort. When you lose in court for not paying the vendor there will be a judgement against your company. If you don't pay that, the sheriff will show up and start taking shit.

[–]Kalepsis0 points1 point  (2 children) | Copy

This was the plotline to Horrible Bosses 2.

[–]Endorsed ContributorClint_Redwood[S] 0 points1 point  (1 child) | Copy

Haha, i keep hearing that, I'll have to watch it.

[–]Polar1zing0 points1 point  (1 child) | Copy

Can a lawyer or someone familiar with such contracts explain to me what this big shot corporate lawyer is gonna say when the little guy goes to (small claims? not from USA) court with a contract and no payment? Is he gonna say the work was not done correctly or something?

[–]Endorsed ContributorClint_Redwood[S] 0 points1 point  (0 children) | Copy

There is a ton of stuff they can do. They can drag out court hearings for years, slowly siphoning your money that you must pay your lawyer for. They cant dump thousands upon thousands of legal documents if they want(Ever seen "Silicon Valley?") They can claim you broke the contract, then you are on the chopping block.

A lot of times, unless it's a ridiculous amount of profit, which it rarely is, you will lose more money fighting them rather than taking the lose, move on and invest that time and money into an actual profitable account. Guys proclaiming to fight the big corps have little experience with this and it's mostly an ego driven thought process. Logically, when it happens, the number rarely add up to you come out with a win.

[–]westsan0 points1 point  (0 children) | Copy

First of all, is this sub morphing into an all-around things guys hate forum?

Secondly, great advice. Keep it up.

Thirdly, is there no tl;dr rule for reddiquete anymore?

[–][deleted] 0 points1 point  (1 child) | Copy

A few years ago I was hired by a friend who work in outside sales in his small family owned business. Business services, something every business buys in $100-$10,000 orders with the vast majority being once every two months and for under $1000, anything over that I would consider a fluke. Their monthly sales were around $85k-$120k per month

Their mentality was that they wanted me to spend all my time going after the biggest customers possible who would spend some huge amount of money on very large jobs. I had a different plan of attack, my mentality was that I was going to go after as many small businesses as possible so I could at least have a bunch of small orders coming in that would justify paying me my salary and commission. The goal being that these people would all be regulars so keeping me on staff wasn't any sort of loss on their part. I targeted businesses that were all within 1 mile of our location so I could service them easily and frequently and visit multiple people on a single trip and I had the ability to drop everything and go see a customer and be at their door in 2-3 minutes, a level of service I could not offer if they were 10-40 miles away (which with traffic could be hours).

Any big single order customer I considered to be some sort of rare fluke, and while it would happen I didn't pursue them, I didn't waste my time focusing on them, I just took the order, made everyone in the shop happy, and kept dealing with my small customers. I don't care if the guy only spend $100 per month with me, I made him feel important because perhaps he would need something big int he future, or refer me to a friend who needed something.

I created a large list of about 35-40 businesses which became my regulars after a year. So every single day I always had someone calling for something. Even if they were small invoices, I knew my bosses wanted big orders, but I was not going to get laid off because I constantly brought work in that covered me being there.

I was mostly in this for education and that I needed work at the time, when I left the company I left a huge list of every single customer I had, who the contacts were and even offered for free to introduce the new salesman to every single one of my customers and that he would now be handling their account. They didn't take me up on it.

Their new salesman, really nice guy, also a friend of the owner. He had a different mentality. He would go after the biggest businesses he could and more or less ignore small businesses. Why deal with people who blow $300 a month when you can find some super whale that will blow $10,000-$15,000 at once?

Six months goes by, and he only brought in one single $3000 order. All of the whales never bought anything and the ones that went to bid the bid was so low that the firm would take a hit doing the business. Of course they moved him out of sales.

Many of my old customers kept ordering anyway even years after I left.

Lesson: Don't have the business oneitis either. You are better off running a Pizza Company that has a 50 people a day coming in and getting carry out than you are with one big customer who does a $3000 catering job once a month. It seems counter intuitive because people in business want to go after the big contracts instead of the small ones, but the small ones are where the security is at and they will lead to larger ones and more regular business.

Someone I know is in business that builds components to trailers, all of his business is tied up with two customers. When times are good his business will be profiting $50k per month (its just him and about a dozen minimum wage employees) however if ANYTHING happens he is incredibly fucked. He pays himself $25k per month and has a wife that spends all of it immediately with absolutely no money in the bank to weather any kind of storm.

[–][deleted] 0 points1 point  (0 children) | Copy

To add to that, I am now self employed and I have two types of customers. Retail customers who pay full price (or some up front special price) and get their products after 2-4 weeks and wholesale customers who buy from me at 55% off retail to sell in their stores. The only people who EVER fucked me were people who didn't pay up front. Now everyone pays up front, retail customers, wholesale, sometimes for special order customers I will take 50% up front.

But I have had people who claim that they were going to sell tons of these things for me, I just had to get them started and that they wanted a larger discount because their volume would be so high and wanted me to front them $1000 my cost of inventory first.

They never sold anything, and if they did they never paid for it. They more or less just vanished and I called it a loss. The quiet guy who just wanted to have one or two in his shop at a time (Cost $90 each) and wasn't ambitious and would just do a slow and steady has been my best vendor. The GO BIG people are always full of hot air.

Use small sales to build up to larger ones. Generally I will refuse to do anything unless I have enough money in the bank to completely cover the cost of doing it. This is never an issue now because retail people always pay upfront and everything else requires a deposit.

[–]David9490 points1 point  (0 children) | Copy

This is such a great post that I wish my father had told me when I was young. So true and I will confirm in a few ways

My step dad was a big dreamer idiot and 3 times in life got taken to the cleaners. He was doing wholesale and got a deal of a lifetime. I remember working on it as a little kid. He delivered and never got paid. Later in life he was doing well in rental properties and then mortgaged all of his properties to buy "swamp land" out in the desert because a family member said it was such a great opportunity. He almost lost my moms house over this. Then there was the time he threw 10's of thousands on growing pot to sell to dispensarys. He didn't really even smoke it but he was going to be rich

Then there is me. I boot strapped my IT consulting company and used unemployment to help pay the bills when I got started. Grew it slowly over 6 years, never put in a penny of my own money. When we lost our biggest client yes it hurt but i had diversified so we are still in business and doing better then ever

If it sounds too good to be true it is. Being an entrepreneur is awesome if you can do it right.

Well written clint_redwood

[–]bitchyeah0 points1 point  (0 children) | Copy

Great post, and absolutely true. I can pretty much guess which company you are referring to in your post. But it is true for many others, I've seen it to many times and failed at my first business for exactly the reason you describe.

[–]almostaristotle 1 points1 points [recovered] | Copy

Please keep these posts coming.

My last firm works in IT managed services and the boss now totally sounds like kevin to me. I kept hearing stories that some architect firm for which we setup all the IT infrastructure like switching, firewalls for owes the firm 60lac INR(indian rupees)($88K). And some school owes them 40lac INR($58K). And the company still works and maintains IT for both those clients. They do have many clients and that's how he is surviving I guess.

Would it have helped Kevin if he had demanded a deposit sort of thing for at least the materials he's going to buy and bill them separately for the work later? But whenever I try to discuss this people are of the opinion that it never works as doing work on credit is pretty normal in business, and at the same time a lot of advice for IT consultancy firms online is that they should ask for deposits for the hardware at the least.

glad if anyone can ans this for me.

[–]Endorsed ContributorClint_Redwood[S] 0 points1 point  (0 children) | Copy

demanded a deposit sort of thing for at least the materials he's going to buy and bill them separately for the work later?

Yes, this is called 30/30/30 but it would have detracted the main theme of diversification and horizontal growth.

[–]Redasshole0 points1 point  (1 child) | Copy

Please, can you give advice about material/books/whatever of quality one can use? Great post.

[–]Endorsed ContributorClint_Redwood[S] -1 points0 points  (0 children) | Copy

Most of my knowledge is purely experience and teachings from mentors. I would recommend 48 laws, Art of War, they are abstract but you can apply almost all of their teachings to business. They just are not written in a business theme.

I also saw someone recommend "How to get Rich" by Felix Dennis. I haven't read it so i can't give a comment but the amazon reviews are great.

[–]iwantago0 points1 point  (0 children) | Copy

Nailed it, this is an awesome post.

[–]Screen_Watcher0 points1 point  (0 children) | Copy

It's a good reason to always start out small and build up to large contracts. If your business can't at any one time float with 0 sales for a quarter, apply the brakes and build capitol before chasing the next large client. Unfortunately most small-medium sized firms have two speeds and they both endanger future growth.

[–]EmanuelGold0 points1 point  (0 children) | Copy

Tldr; diversify your portfolio. Don't put your eggs in one basket.

Ever heard of being succinct? Fuck me this guy shouldn't be giving business advice.

[–]TheRealMouseRat0 points1 point  (0 children) | Copy

Good thing that in my country the government would pay for the lawsuit for Kevin.

[–]greatslyfer0 points1 point  (0 children) | Copy

It's like in poker.

You spread your bets so that you can increase number of hands meaning you can lower variance.

Making a 51% winning decision over 1 big bet is wayyyy more riskier than making a 51% winning decision over 1000 small bets.

[–]LaV-Man0 points1 point  (0 children) | Copy

Funny, this is the plot of Horrible Bosses 2.

[–]3593590 points1 point  (2 children) | Copy

This is the plot behind Horrible Bosses 2. You don't need to reject he offer but you ask for 50% down upfront.

[–]Endorsed ContributorClint_Redwood[S] 0 points1 point  (1 child) | Copy

I keep hearing this. Was the plot of the movie a shitbag CEO or was it a CEO that was just protecting his business and trying to minimize damages?

I'm guessing he was a shitbag CEO as that's the common stigma Holleywood loves to portray.

[–]3593590 points1 point  (0 children) | Copy

No it's actually a very common scenario and I have had clients attempt this any many other cons for free work/engineering over the years. It's just common sense to back your work with money not promises. There's much better business practices to discuss like risk/investing into client products and diversifying your assets.

[–]vaelamin0 points1 point  (0 children) | Copy

Did anyone else think this story was gonna turn into Kevin got the million dollars but his wife got bored of him and got divorce and took all his shit?

Good story none the less. But seeing as how you have been in this industry for a while im sure you have probably heard some stories like this one.

[–][deleted] 0 points1 point  (0 children) | Copy

Borrow $100,000, and the bank owns you. Borrow $1,000,000,000 and you own the bank.

[–]rpscrote0 points1 point  (0 children) | Copy

Or -- Actually have an attorney review your major contract, because to not do so is incredibly stupid. You have a contract, right?

Include a strong arbitration clause with timeline provisions (e.g. from filing to resolution in 90 days w/ no discretion to extend). Include provisions for winner gets attorney's fees, arbitration fees and punitive damages.

Then, don't take a contract unless you could live without revenue for 120 days and make sure you have enough to keep an attorney on retainer to fight the inevitable (but easily defeated, since you had an attorney look at it) attempt to nullify the arbitration clause. Dont take a contract if they wont agree to arbitration and there is a massive difference in the size of your co. and theirs.

Include a late payment fee (3%+) in your contract. File your arbitration claim. If you're actually in the right, and you keep good documentation, and you didnt pick a shitty arbitrator, you have a good chance of winning, you get your attorney fees back, the cost of the contract, the late fees and maybe even punitives if the other side did this intentionally to fuck you over. Is it complicated and somewhat expensive? Yes. But its a shitload less complicated and expensive than real court litigation, by miles. Not to mention, million dollar deals arent usually given to people who cant handle a little complexity.

[–]beachbbqlover0 points1 point  (0 children) | Copy

What he just put down as his first example, with Kevin, is absolutely 100% patently true. This is why you can't start a business in the trades in Alberta. It can take 90 days from completion to get paid, and that can be delayed if the courts figure there was renegotiation or other justifiable reasons to delay.

That means if you're a plumber you need to be able to float workmanship and materials for half a year for your entire company's operations. That's why nobody can go out and do it alone anymore and the few companies that do make it can charge a metric fuck ton of cash for service work (there's no real competition)

Even with multiple contracts, all too often guys will bite off more than they can chew and accept too much and then their cash float gets pinched from all the materials purchases.

I've even heard from the contractor side that they sometimes intentionally do this, bankrupting subs so they don't have to pay them.

[–]ECoast_Man0 points1 point  (0 children) | Copy

This is an excellent post, coming from a corporate litigator. I have seen this happen so many times. I actually don't take the 'jilted business' case' unless I get a substantial retainer.

That being said, I hope your 'Lessons Learned' are read by the audience, as that is an excellent overview of your main point. This is great advice - all that glitters is not gold, people will eat you alive when it suits them, and don't put all your eggs in one basket.

I hope readers realize this is your point. In your 'Dark Rule' post you quite accurately remind everyone that fucking people happens, but it is not to be an optimal path. It's more an effect of a cause. Reputation and legal can fuck you if you aren't wise about it.

Grade A post, and I appreciate you writing to an assumed intelligent audience. I do the same.

[–]mexican_swag0 points1 point  (0 children) | Copy

I think the next post will be on navigating the business world as a kid coming into a family business.

Please write this post! I would be most appreciative.

[–]mdadm0 points1 point  (0 children) | Copy

If its your first order with me you're paying 50% up front, then 50% before I release goods for delivery.

Kevin is just a fuckwit.

[–]TheInkerman0 points1 point  (0 children) | Copy

As an aside, Tim's business model (multiple, smaller customers) is actually better than Kevin's (one, big customer). Even if Kevin is earning more than Tim with his one customer, he is totally reliant on that customer, and, because he needs to keep them, he will structure his business in such a way to meet their specific demands. If that customer leaves or themselves collapse, Kevin is fucked, and restructuring to find a new customer will be A: Expensive, and B: Kevin doesn't have the skills or network to do so.

Contrast this with Tim. Tim's company relies on multiple smaller customers, who may come and go (basically, plates). His company is not structured to the specific needs of any one customer, and thus applies generally to the industry. If he loses a customer, Tim can rely on the others to carry him over until he finds a replacement. What's more, because Tim is dealing with a larger number of customers, he has a developed network who trust him, and who can put him in contact with (or even direct to him) new customers, as well as the all important 'reputation'. He has further developed the necessary networking/sales skills to gain new customers.

[–]dark_g0 points1 point  (0 children) | Copy

A company I was consulting for decided to cut me off (understandable, I was more expensive than others they could get), but also saw fit to stiff me for my last bit of work, about $3k. They returned my invoice claiming the work had never taken place. No, I did not call them cheap mofos, nor did I take up legal action even though I had evidence. Why? Because they had overlooked I had in my possession two of their company laptops, worth approximately the amount owed! Days later they woke up and sent me an innocent bubbly email saying Debbie (the office slut indeed) would come around my place "to pick up the laptops", wink, wink, and would I please tell them my home address. I never replied (which would have been admission of holding their property), damned email server must have screwed up. Besides, who in their right mind would pay to fuck Debbie?! LESSON: not doing additional work until paid for the previous one keeps you off the hook for all but small amounts, and if you also hold "collateral" so much the better! --Got good service out of those two machines. They are still in my basement somewhere.

[–][deleted] 0 points1 point  (0 children) | Copy

What company stays in business for 30 years and bets 1 million dollars worth of equipment on nothing but a promise? Story is bullshit.

[–]koleraa0 points1 point  (0 children) | Copy

That was quite an interesting read.

Is there a name for this kinda thing? I'd love to read a book or something that goes over stuff like this.

[–]Belerion0 points1 point  (0 children) | Copy

This is a great post. Taleb goes over the same concept in Antifragile. A single, high-paying client is a fragile system that is harmed by volatility. Whereas a diversified client base is, at worst, robust.

[–]nubswag0 points1 point  (0 children) | Copy

You should public an e book with all of the advice on business you would be comfortable sharing. I would love a business book from someone from the red pill because it really is the only place you don't find bullshit. Thanks for this post regardless

[–]devilkingx20 points1 point  (0 children) | Copy

isn't the lesson here not to ever work without getting either money up front or some sort of guarantee?

[–]memphisjohn0 points1 point  (0 children) | Copy

Good stuff... I make my living in business to business deals and all of this is 100% right on.

[–]ven50 points1 point  (0 children) | Copy

More posts like this please. This was fantastic.

[–]F_Dingo0 points1 point  (0 children) | Copy

Saved.

This is a great post, gives real meaning to the old saying "If it's too good to be true, then it probably is."

I hope you write more business related posts, this one was very good.

[–]malariasucks0 points1 point  (0 children) | Copy

this is basics in business and I have no idea why you think this is a red vs. blue post.

Wal-Mart has done that very thing to many vendors

[–]ghee990 points1 point  (0 children) | Copy

there are good lessons in here, but one major flaw. when you said this:

"My father sat me down one day after he got a call from a company and he said, "Clint, one day you are going to get a call from a customer or new company. They are going to offer you more money than you've ever seen before in your life. It will be like holding a winning lottery ticket in your hand. All the shit you can do with that amount of money will flash before you. It might be equal to or even dwarf our entire sales for the year. Everything in you will tell you to take the deal.

Don't ever take that deal."

thats just bad advice.

a better advice would be, sure... take it, but make sure you only take it on terms that won't ruin you if it falls through.

for example, when i take a big job, I will usually require 1/3 up front (before i've even done one bit of work)

then another third when the work has reached an agreed upon mid-point.

and the final 1/3 upon completion.

that way i'll never be out too much if they flake.

and, if the payments stop, or are late, then (no matter what) ALL work stops, and not a single thing gets done until they are current.

if i have even a sense of them being shady, or if they have a history of non-payment to others, then i'll specify that the payments be put in an escrow account, and that a third party will be in charge of payment to me, once the various thresholds are met.

and if there are changes, which there are always requests for, i type up a separate invoice, on the spot, for the additional work, and have them sign off on it right then (with payment terms included as well). its a bit of a pain, more paperwork, and a less "friendly" way of doing business (as opposed to just trust and a handshake)

but, it protects me, and protecting yourself is often the difference between staying in business and failing at it.

Are there some big jobs that you won't get by being so clear, upfront, and specific in what you want? sure, but most of the ones you'll lose are from the shady operators anyway.

a legitimate, honest, and professional company or individual will, more often than not, respect you for having your shit together, knowing what you want, being clear about what you'll deliver, and having specific terms (especially in regard to the financial aspects of the deal).

So, i , personally i say take any big deal that you feel up to taking on, just (if you do) make sure you do it on terms that protect you. And if they don't want to work with you on the terms that you need in place to feel safe, then just walk away.

but don't walk away before you have even set your terms, or gotten their reply.

[–][deleted] 0 points1 point  (0 children) | Copy

Isn't part of the problem that Kevin never asked for any money upfront?

Also not clear to me, did Kevin send them the purchase request without getting paid, or did they just leave him hanging?

[–]LukesLikeIt0 points1 point  (0 children) | Copy

If they have so much money why not just pay though? It seems like petty theft.

[–]holybad-1 points0 points  (5 children) | Copy

If a business that has been around since the 80's gets 86'd by 1MIL it's kinda a shit business no?

[–]aDrunkenWhaler0 points1 point  (0 children) | Copy

Shit business or not, it doesn't really matter.

[–]sammisaran0 points1 point  (0 children) | Copy

The numbers were fabricated for easy comprehension of the story.

[–]blacwidonsfw0 points1 point  (2 children) | Copy

No it's a small business could be like 5 people who clear 500k a year so a million would def fuck them.

[–]holybad-2 points-1 points  (1 child) | Copy

5 people clearing 500k a year would mean their cash flow allows for a 2.5MIL salary budget. 1MIL wouldn't bankrupt them. Even if a company goes into the red, if it has a business history going back to the 80's with cash flow in the numbers you used they wouldn't go bankrupt... not for a company that's obviously in it for the long haul ( in business over 20 years)

I do this shit for a living and I'm saying the numbers don't add up.

[–]JimFury0 points1 point  (0 children) | Copy

If you do this for a living you're bad at it. The numbers being used are hypothetical for the point of the story. You're arguing semantics for a stupid reason.

[–]ben0wn4g3-1 points0 points  (1 child) | Copy

"I'm 25"... stopped reading.

[–]tedted8888-1 points0 points  (0 children) | Copy

Only thing I could add is that I wouldn't think of it in terms of legality. Like you said, if you expect to sue ur already in the blue pill mindset. I think there's general lessons her applicable to gov't. It's never there to help the little guy. Only to empower the rich by artifical monopolies and artificial barrerirs to entry.

[–]NiceTryDisaster-1 points0 points  (1 child) | Copy

Hands down one of the best posts I've read on here.

Could you elaborate on

"This is also why consumer goods are great to get into, then you literally have thousands of customers that don’t even equate to 0.1% of your sales. No one owns you and no one can bully you."

[–]Endorsed ContributorClint_Redwood[S] 0 points1 point  (0 children) | Copy

You are selling stuff like colt firearms, goodyear tires, Sony TV's, Dell Computers.

Consumer goods, you literally have hundreds of thousands of customers. No business to business transactions happen. Any one customer can not bull you as you don't give a shit if they have a problem. They have no power over you other than an online review(which can still fuck you but not like business to business).

[–]PissedPajamas-1 points0 points  (0 children) | Copy

It's insane how well TRP's philosophy on relationahips ties in with business. It's all about abundance

[–]BRENDORVEGAS-1 points0 points  (0 children) | Copy

This is why I come to this subreddit.

[–][deleted] 0 points0 points | Copy

[permanently deleted]

[–]BleachedWhale0 points1 point  (0 children) | Copy

Unless, like myself, you take a former client to court for $60k representing yourself and get the money without any problems.
Yes, it took 7 months to get the cash - but it's not hard at all.

[–]R3v4mp3d-1 points0 points  (2 children) | Copy

The post is fairly good, although it's VERY messy and hard to read. What I don't get:

1). Are you 50 or are you 25 years old?

2). In all the post you talk about Kevin's side of the story. What you never explained: why does the big comapny ruin him? I mean: he's driven, he gets the job done, he got a link with you (more loyalty and better work ethic). So why would you fuck him as to later start searching for a new supplier which might be shittier, less driven/ motivated, a ripoff, etc. This makes no sense.

[–]Endorsed ContributorClint_Redwood[S] 1 point2 points  (1 child) | Copy

the second article covers the thought process of my character. This was a fake narrative based on real life experiences. I have to write in the abstract and vague due to SWJ and legal reasons for naming no companies.

[–]R3v4mp3d0 points1 point  (0 children) | Copy

Thank you for clearing that up and sorry for the fake accusations. Good post!

[–][deleted] -2 points-1 points  (4 children) | Copy

The person who got me thinking about guns now got me thinking about business.

What is your job? How do you get started as an entrepreneur?

[–]Endorsed ContributorClint_Redwood[S] 0 points1 point  (2 children) | Copy

Lol you'll never know.

maybe I make guns.

Maybe I don't.



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