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Tent Tip 125: My Secrets For Cost Control

For nearly 15 years I have been helping tent rental operators and watched them become successful. Time and time again, our stories have been the same. Here is my story and some of the lessons I learned. I was successful in the tent rental business, but after awhile, I noticed wasn’t making enough money for myself. And, as the business owner, I was always the last to get paid. It took me awhile to understand why this was happening. I was blind to the obvious. I finally figured out that I had costs I could not control and that my profit hinged on these costs (I later found out that accountants call these types of costs, variable costs) . My profit, or lack thereof, changed based on how the wind blew—literally. Because the wind, or the weather in general, was a huge variable cost— something I had no control over and it, along with a lot of other things I couldn’t control, was constantly eating away at my bottom line. That’s when I went back to basic accounting: Profit = Money In – Money Out. So simple, so basic. I starred at the “money out” part of the equation and thought… what other kinds of things are hard to control that are costing me money? I knew I had to get a handle on things like:

  1. Mother Nature can be very challenging–If the wind is really blowing, or if it is really hot or really cold, if there’s rain or lightening more people have to be sent out and the job takes longer; making deadlines becomes difficult and sometimes impossible, no matter how much money is spent.
  2. If tent stakes have to be driven into really hard surfaces, it causes huge delays; everything takes longer and the morale of the crew suffers because of exhaustion and frustration. Then the stakes have to be pulled out. The costs just kept rising.
  3. Traffic. If there’s a lot of traffic, the crew could be sitting in a truck, accomplishing nothing but costing money and robbing profit.
  4. Hiring employees—the more variable costs that showed up often meant hiring more employees to get through. There are training costs, and the costs of hiring and managing the temporary employees. And of course, there are costs associated with employees not showing up.
  5. And a huge surprise to me—the biggest offender of all—dirty tents. Dirty tents affect every aspect of the business. The overtime spent on cleaning them, the guys hating cleaning them, no quality control on how clean they were getting, the return trips to re-clean tops in the field, not having enough clean tents to keep up in the busy times, and of course, customer complaints.

The other big reason I wasn’t making enough money had to do with the money coming into the company (what the customer was paying). By the time I was experiencing the costs I could not control, I had already quoted the customers for the jobs. I was stuck. I had a fixed amount of money coming in and who knew how much money was going to go out? My paycheck got smaller. So I ended up with less money and more headaches. Going back to the basic equation:  Profit (my paycheck) = Money In – Money Out; I had no choice–if I wanted more money and less stress the only things I could change were my control over the variable costs. I found that controlling my variable costs was a little like planning for a natural disaster. They’re not always a factor, but when they are, you’d better be prepared. I felt a little like the Red Cross—I had to develop plans, systems, and procedures along with providing education and training courses for my employees, and I had to find better tools to use. I had to PLAN to control my costs; this is key to any tent rental business.

As I really examined gaining control over these seemingly uncontrollable costs, the #1 problem was the chaos that dirty tents brought to the business. Dirty tents can cripple your business. I know because they crippled mine. Here is a cost you can control! I was, like most people in the industry at the time, hand washing my tents. The hand-washing was a huge labor cost, required a lot of space and was often inefficient, always hard work and seldom really effective. I knew there had to be a better way and so I set about exploring the idea of mechanizing this process—designing and building a washing machine especially for the tent rental industry. Since then we have sold machines to businesses on three different continents and 98% of all the major USA tent rental markets now have a Teeco Tent Washer.

Gaining control over the costs that dirty tents bring to your business is possible! The only reason I have a successful business today is because I took the time to stop and look at the costs and inefficiencies that were killing my business back then. We can show you what we have shown so many tent rental operators across the world. Is a tent washing machine a good idea for your business? Maybe. You will have to help make that determination. One simple conversation–approximately 20 minutes of our time—you’ll tell us about your business and together we’ll see if a machine is a fit for you. To set your appointment for your Discovery Call, go to www.teecoconsult.com