Interview with Ken Snow 12-13-06

Mikey P

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How do you deal with slow periods and keeping your employees busy?. Do you find yourself laying off and how does this effect your bottom line?.
 

Ken Snow

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We lose a ton of money in the winter months. We do voluntary layoffs of a number of people, keeping their benefits in place. We also keep a few extra in to refurbish and recondition the units we are selling as well as to go through all the ones we’re keeping to fix up any of the little things that were being put off. They also do lots of special projects, usually assisting our mechanic/maintenance team.
 

Mikey P

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Does your staff clean area rugs at your client's home? If yes how do you determine when a rug should be taken in to your shop vs in home? How does your staff translate this to the clients?.
 

Ken Snow

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We try not to clean area/oriental rugs in the home for a variety of reasons. It is more risky to the rug and the surrounding surface to clean them in the home, plus we feel they are cleaned more thoroughly in our plant. If I am asked I tell them if I could practically take their wall to wall carpet into our plant I would and that usually ends it there. Anytime we do them in the home it is at the customers own risk for everything, although we obviously are careful.

We do not have any standard waivers for any in home cleaning. Our guys are instructed to note problem areas or damaged items. In our rug cleaning order entry system we have a few disclaimers that are auto populated if a specific type of rug is picked.
 

Ken Snow

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When a new person is being considered, the Manager or our HR person goes to our on line reference library and opens the file "New Hire Package". This file has all the forms that the employee needs to fill out (i.e.: State & Federal W-4's, the Federal I-9 Form, etc.). Also included in the package, is the "Consent to Conduct a Background Search", "Consent for Drug Testing and the authorization for the firm who does the drug tests to perform it.


Drug Tests are given to all New Hires as we are a “Drug Free Workplaceâ€Â
 

Mikey P

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I am on the verge of needing a new truck (adding 2nd truck). At what point do i know that i really need one? I know I am booked for 3-4 weeks and adding 4-5 new customers per week but I don't want to jump the gun. I know the 2nd truck means twice the cost of everything.
 

Ken Snow

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This is another area that my experience will not really be relevant for an owner op. Adding a second truck is a 100% increase in assets, and possibly personnel costs for an owner operator where for me it is a very small increase. If we are consistently booked out 5-7 days and think it is sustainable, we will add a unit, provided it is before September so we can maximize the use for the first 4 months. I would say you have to analyze and project what the “additionalâ€Â
 

Ken Snow

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what do you like to do in your off time?
Play racquetball, sing, read novels, shoot pool, eat good food.

Favorite adult type beverage
Heineken

Live music fan
yes

Jazz, rock, funk?
Rock

Play any instruments?
Sing, and wanting to learn piano

Play golf?
 

hogjowl

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With such a great mind to ask questions of, I hate to ask a simple nuts and bolts question, but I just gotta know, ya know?

Since it is pretty much a given that you don't prevacuum, you can't at that price point, I imagine, you certainly aren't running glided wands. So, what wands do you use? Standard Butler wands, with Butler glides?

Do you use the standard Butler set-up? 1.5 inch whip hose on live vac. reel?

Do your customers ever complain about drying times?

What ARE your average dry times?
 

Mikey P

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I was just going to ask that Marty....


I want to know if they use the stock Butler set-up. You know, inch and a half whip hose, standard Butler wand. Or, have they gone to glides? If they are using glided wands, how are they managing using them without prevac. Do they prevac?
 

Cameron1

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Ken, what is your price to protect 5 rooms of carpet, after they have been cleaned? What brand do you use?
 

Ken Snow

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hey Marty aka PorkButt

We are not using Butler wands. We have an assortment of old standard wands, all unglided at this time. We have almost no complaints abut dry times which run anywhere from 3-12 hours.

Ken
 

Mikey P

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Let me get this last question in before you all fire away...


Upsell training, any chance of your training manual being posted here? If he has a manual or course he puts his guys through I'd love to use it.
 

Ken Snow

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Our Butlers are fairly stock, with some additions and deletions. For instance we have them sent out by Butler to have them rust proofed & lined before the unit is installed. We have them order the 1 tons with cd players, the chrome package and a couple other premium features for appearance or comfort. We get no hoses or wands preferring to buy them ourselves (we go through 5000 ft or so a year). At this time we are not using glided wands although Greenie has sent some to us to demo.
 

Ken Snow

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In pretty much all areas of our company we use a mentoring process for training. New team members depending on what they are hired in for will work closely with someone already in that area. We also try to have as much cross training as possible, to give the person an overview of our complex, medium size business. We have a couple different training manuals depending on the position, and also a company handbook with general guidelines and expectations, but we do not have a formal up-sell training program. For this hot seat session I did check to see how our seniority was as it has been awhile since I checked. I found that our average Specialist (crew leader) has been with us 14.5 yrs, with the newest one being about 6 years. We will have 2 officially become specialists in the spring that have been with us just over 3 years, and have been acting in that capacity as needed this year. There are a few places to get real good info and systems (JonDon’s Strategies For Success) as well as Howard Partridge through his roundtable or other forums.). I have been to both (SFS twice) and they packed with great information.
 

Mikey P

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Can I assume that your techs do not pre vacuum?


How do you deal with the jobs where the client did not vacuum and the carpet can not be seen through all the pet hair and junk?
 

Ken Snow

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That is correct we do not pre-vac and on the rare occasion that the customer does not vacuum we do it with the hose off, and the wand.
 

Cameron1

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Roughly, what is the profit margin of the in-home cleaning operations?

How did you compensate during the recent gas price increase?
 

Mikey P

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A follow up to Steve's question would be:


What has worked for you as far as marketing for new acquisition?. Is there a time of year that marketing dollars are increased and decreased.
 

Ken Snow

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I sure hope and believe that we are paying a little less for buying 30ish Butlers every 5 years than someone who is buying 1 every 5-10 years. That said I am also sure it is not significant $ as the margin is not huge in that business after taking into account the vehicle cost which we have already gotten any rebates etc on. In the scheme of things my savings over someone else probably wouldn’t pay a week of my water bill.

I am not familiar enough with the ops and quirks of other units to say what our second choice would be. There seem to be lots of fine units out there, but we are still feeling that the butler works well for our business model.
 

Jeremy

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What % of your gross is commercial work & what methods & equipment do you use in "inaccessible" areas.
 

Ken Snow

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I have an annual ad budget, but spend most heavily in the late March to early November. Winter in Michigan can be brutal and I have found that spending a lot on adv doesn’t get an adequate ROI. After the beginning of November we are usually so busy we don’t need to spend as much as a % of sales so again it is cut back. My 2006 ad budget was about 40% Radio, 26% network TV, 17% Print (newspapers and direct mail), 12% Yellow & White pages & 5% Internet and Database marketing. This is after a chunk off the top is accounted for Production & Overhead, plus things like brochures, magnets, vehicle painting and lettering, etc. that are part of my overall marketing budget.
 
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Did Hagopian become such a "powerhouse" by buying out the competition? If so what was the largest company Hagopian bought out? How many companies did Hagopian buy out? If not, how many trucks on average do you add per year?
 

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