Few things in life are as humbling as getting your ass kicked at chess by a electronic device you could flush down a toilet. Witnesses stated that I was talking trash and cursing at the phone. They also stated that the phone just ignored my insults and continued to kick my ass. The chess bug has bitten me again.
Until I bought the chess app for my phone, I hadn't really played since I graduated from college. I played on both my high school and college chess teams. My wife and children never tire of reminding me of my geek background. In high school, you could say I was obsessed with chess. During my junior year in high school, the guidance counselors made us take a career survey that masqueraded as career education. The survey asked what we wanted to be if we could be anything in the world. I answered professional chess player.
This apparently caused a meeting between my guidance counselor and the chess team coach. The chess team coach was my Latin teacher. My basketball coach used to tease him by asking if the chess team had any serious injuries, like hangnails or migraines.
After Latin class one day, the coach asked me to stay after class. He wanted to discuss my choice of career as a professional chess player. He was ready to launch into a spiel about how difficult it would be to earn a living and maybe I didn't have the talent to be a professional. I told him not to worry, I had no intention of becoming a professional chess player. I was just messing with the guidance counselor for the way the survey question was worded. I told him, on any other day, I might have answered pro basketball or baseball player. Chess just caught my fancy that day. We can't be anything we want to be despite the well meaning lies told by high school guidance counselors.
A potential business owner has two factors to consider before launching a new business. First, does he have the talent to succeed at the business? Second, can the business be financially viable? Missing either of these factors condemns a new business to failure.
On the way to work a couple weeks ago, a pickup truck passed me. If you have read a few of my blog entries, you know how little I like to be passed on the way to work. I sped up a little and noticed the pickup had a wrap paint job for a business. The business was “Doody Calls.” I was a little familiar with this business but not very. I decided to do a little fun research to see if scooping poop was more profitable than my CPA business. Thanking Al Gore for the internet, the research was easy.
“Doody Calls” is a franchise business dedicated to de-poopifying lawns. Dogshit isn't enough of a market for them. They also do cats. The basic business model is that they charge by the week by dog. I was curious about pricing, but the “Doody Calls” web site didn't have pricing information. It is primarily for lazy people, like me, looking for some idiot to pick up poop. The site also pitches the dogshit business to potential franchisees. I am not so easily defeated, however.
Google knows a lot about feces. I quickly found a web site from the foremost expert on the little bundles of doggy joy your neighbor's greyhound leaves on your front lawn. I can only imagine the conversation this guy had with his guidance counselor when he took his career survey.
Guidance counselor: “So you want a career flipping feces....”
Student: “It smells like a growth opportunity.”
Guidance counselor: “Were all the leper colony nursing programs full?”
The web site is http://www.pooper-scooper.com/FAQS.HTM. The site quickly gave me pricing information. Lazy-assed customers like me get to pay $15 per dog per week. Apparently, the breed of the dog doesn't matter. Whether you have a dachshund or a labrador, you pay the same amount. That doesn't seem fair to me for some reason. I learned one other interesting and important piece of information. Our world champion pooper scooper thinks he can de-crap seven yards in an hour. Given the price per dog and the number of yards per hour, I was able to construct a spreadsheet model of the feces business. You may wonder why I don't have better things to do with my life – like letting the phone kick my ass at chess again. I wonder myself. If you also don't have a life and would like a copy of my spreadsheet, please e-mail me at fstitely2@gmail.com. I doubt the Harvard Business Review will be calling me for it.
I have a business rule that should be called “Frank's Rule of Business Modeling.” If you can't sketch out how your business plan can make money on one sheet of paper, your business idea has no chance. This rule is brilliant, I know. My iPhone is being interrupted making its next chess move by a call from Donald Trump.
My spreadsheet is a very simple business model for the poop business. I started out with a couple of assumptions. Then the spreadsheet let's me test those assumptions to see just what it takes to make a decent profit. This is what you should do when you are considering starting or purchasing a business. If you don't know up-front how you are going to make a profit, you will fail as soon as you run out of your initial capital. Then,if you are really stupid, you borrow a lot of money to keep going finally ending up bankrupt.
I learned a few interesting things from my dog do do model. First, I learned that the most critical factor in making a profit is the number of yards per hour you can de-fece-ify. I am really skeptical about seven yards per hour. I am really skeptical even if the dogs are all Jack Russell's from the townhouses of seven next door neighbors. I assume there is probably dog poop technology involved. Research into dog poop technology was probably performed by M.I.T. under a federal grant from the Environmental Protection Agency. Nonetheless, picking up and moving a digital, electronic pooper scooper takes some time and traveling across Loudoun County between customers would be a real time killer. I think two to three yards per hour including travel is more realistic.
Another important factor is price per dog. Our dog crap expert says $15 per dog. Since you know me to be generous soul, I adjusted that for the cost of living in Loudoun County. In my model, I raised the price to $20 per dog. To evaluate this business, I also needed to make some other assumptions. I assumed three one man crews, who are paid $16 per hour. The Doody Calls franchise royalty is 9% of revenue. I also roughed in some estimates for vehicle costs and some other obvious overhead expenses.
My final result assuming the three crews and the other expenses was a profit of about $64K for the year. This is certainly best case since I am obviously missing a number of other expenses. If you change the number of yards per hour to two, the business loses money. Our crews will have no time to dilley dalley on their solemn doggie doody duty.
If you operate this business really efficiently, with three crews, you have a chance to make $64K per year. That doesn't really excite me. I don't think Jennifer Aniston will marry me at that income level. That also ignores the obvious problem with maybe some unseemly odors when I come home from work. In conclusion, I'm staying with the CPA business. Sometimes dealing with the IRS feels a lot like cleaning up dogshit, but it pays better and let's me afford the finer things in life, like an iPhone that kicks my ass at chess.
This afternoon my wife emasculated me. We were returning home after she had some minor foot surgery. She was craving Starbucks. So she made me go into the store, order her drink, and bring it out to the car. Real men don't go to Starbucks. Not only that, but they speak a foreign language. Vente means large. What language is that? Probably French. That's enough to make me suspicious that Starbucks is a communist plot to eliminate testosterone from all American males.
Thanks for reading! For serious tax and accounting advice, check out our main S&K web site at www.skcpas.com.
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