September 12, 2024 • 54 mins
Ever wondered how towing companies are revolutionizing their operations or how strategic mergers can double a business's footprint? Tune in to hear the latest developments from the frontlines of the towing and recovery industry. We kick off with an in-depth look at the recent training sessions that took us to Rhode Island and highlight some upcoming events, including the Midwest Regional Tow Show in Ohio. From specialized electric vehicle classes to heavy-duty towing training, we discuss the importance of continual education and community support, emphasizing initiatives like the Wounded Driver Fund and cross-training with fire departments.
In our second segment, we dissect the transformative merger between Henry's and Roadrunner in the Washington DC metro area. Learn how syncing GPS and dispatch software through Traxo has led to unparalleled operational efficiency. We also dive into the nuanced world of financial partnerships, contrasting the benefits of family fund investments with private equity. Hear why family funds often provide more robust long-term support, allowing business owners to retain their operational expertise while pursuing strategic growth.
Lastly, we tackle the often complex topic of towing fees and operational best practices. Discover why a flat rate system could be a game-changer for both consumers and towing companies, reducing disputes and ensuring fair pricing. Police-authorized towing contracts in Northern Virginia are highlighted as a model of success. We also explore the legal strategies for recovering costs and the importance of detailed documentation. Wrapping up, we discuss the ethical principles that can benefit every employee and secure generational wealth, offering opportunities for consolidators to collaborate and grow together.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:05):
Welcome one and all to the American Towing Recovery
Institute podcast.
Remember this is your podcastto promote safety, education,
positive public relations andnetworking within the
professional and business-mindedtowing and recovery industry.
I'm your co-host, dj Harrington, better known as the Tow Doctor
(00:27):
, and my other host is WesWilburn, over 40-year towing
industry veteran, the founder ofAmerican Towing Recovery
Institute of Fayetteville, northCarolina.
He has produced and conductedtraining and certification
programs for leading towingcompanies, equipment
(00:48):
distributors, towingassociations, dot, fire
departments, rescue, as well asmilitary installations across
the United States.
Wes has been published over 100times in major towing
publications published over 100times in major towing
(01:08):
publications.
Wes has developed many courses,including the most recent
awareness-level course for allresponders that specialize in
electric vehicles as well ashybrid, natural gas and hydrogen
vehicles.
Wes has provided insight as themain speaker for over 30 years
at more than 900 trainingclasses and has been recognized
(01:31):
as one of America's greatesttowing trainers.
He is well known for hisstraightforward but
down-to-earth teaching style.
West Wilbur and his AmericanStorm Recovery staff have
developed an electric vehiclephone app, wwwev-clevercom, with
(01:54):
over 700 passenger vehicles andover 100 heavy-duty vehicles,
bringing you a new level ofconvenience for information at
your fingertips for allresponders and their groups
Without further ado.
Here's my dear friend and agreat guy for our industry, wes
(02:14):
Wilber.
Speaker 3 (02:15):
As always, DJ, I appreciate your kind words.
You're too kind.
It was really a godsend when wegot introduced together.
I have to admit, DJ, Iappreciate you more than you
know.
Speaker 1 (02:27):
Well, vice versa, I am so proud to be your
co-partner on this deal.
I'm proud to be with you, wes,but I'm proud to be part of this
industry because you really docare about the end user.
You care about the one outthere working the white line, so
(02:48):
I'm very proud to be part of it.
So tell all our listenerswhat's happening this week,
because we got a great guest.
I know that Well, as I'mrecording this.
Speaker 3 (02:59):
I'm getting ready to go to Rhode Island for a class,
but if people will be, listeningto it that class will have just
happened.
We can't mention that.
Or we also wanted to give ashout-out for the North Carolina
show, like we did in the lastepisodes.
Yes, that will already havepassed when people listen to it.
I hope they had a good strongshow there, Coming up right
(03:20):
before the week when people willbe listening to this will be
the Roberts Center the MidwestRegional Toe Show, September
12th through the 15th.
It's at Roberts Center,Wilmington.
Speaker 2 (03:31):
Ohio.
Speaker 3 (03:32):
Great show, I know you're going to be involved
there with many different thingsand we had Bruce on the program
.
I guess what two episodes DJDoes that sound right.
Yes.
And he's got a lot of greatthings planned this year A
parade and a hog picking.
(03:53):
I believe it was pig picking.
I don't know if they call itpig picking in that part of the
world.
Dj.
Speaker 1 (03:59):
Yeah, celebration of Life is where we're going to
remember all the loved ones,whether you were killed on the
white line or just maybe a heartattack in the office or out
fishing with your son.
We want to remember anyone inthe towing industry, so it's
called Celebration of Life,which is that Thursday night.
(04:21):
Then, as a thing that youpromote all the time, this is
the Wounded Driver Fund and Wes.
You know, you're a real reasonwhy they started all that and
that's been very, verysuccessful and I'm speaking
there and, of course, you sentme stuff to.
They're going to raffle off upthere and I'm bringing it with
(04:45):
me and it's a donation from theamerican towing and recovery
institute.
So, uh, you're a very kind guyand a lot of people don't know
how much you do for the industrywell, thanks, dj.
Speaker 3 (04:58):
I appreciate that.
Um, we'll be at LynchburgVirginia.
On September, the 20th we'redoing an electric vehicle class.
That's Friday evening 6 to 9.
That's a free class.
We're going to feed you dinnerat 5 o'clock, so get there a
(05:19):
little bit early.
And on the 21st 22nd, lynchburgVirginia, we're doing a heavy
duty class with some rotatorusage, heavy duty, towing and
recovery.
September 21, 22,.
That class is about a littlebit over halfway filled up right
now.
Speaker 1 (05:36):
So we're looking forward to that September the.
Speaker 2 (05:43):
Tennessee Toe Show September 25-28.
Speaker 3 (05:46):
Contact Brenda at toetimesmagcom for more
information and then the firstweek of October we'll be out in
Oregon it's a private school.
I think they've got it aboutfilled up.
Then the next class will be inlake station, indiana our good
(06:15):
friends at wafco october 18thelectric vehicle class.
It's three hours on a fridayevening 19th and 20th, heavy
duty with some rotator usage.
November 2nd and 3rd we'll beback in Elkhart, indiana, with a
light to medium duty class,two-day class, full-blown
hands-on.
And then the last public classof the year at this point is
November 16th 17th 2024, two-dayfire tower cross training in
(06:41):
Sumner, south Carolina.
It's a fire department crosstraining will be myself and ron
moore teaching the class, sowe'll look forward to seeing
some of our friends there.
Sumner tower is a great friendof the podcast.
I've got a youtube channel thatthey're very active relatively
active, I guess, would be theright term and and really nice
(07:02):
folks.
Hal Watts, the principal thereat Sumner Record, is a paid
firefighter.
Very instrumental on helpingcross-train between a small
department and the community.
So we're looking forward to agreat class there also, DJ.
(07:23):
I want to talk about one morething before the break.
Next year, early May, we'relooking forward to a great class
.
I want to talk about one morething before the break next year
, early May we're doing acomplete training class started
light duty all the way throughheavy duty.
We talked about doing it bootcamp style.
I don't think we are at thispoint.
Boot camp style is when youcheck in at one time and you
(07:44):
don't check out until a weeklater and you're involved in the
class the whole time.
I do not think we're going todo that.
I do believe what we're goingto do is teach a class like we
normally do, but we might have acouple evening sessions.
First day is going to be lightduty.
Second day is heavy duty, thetwo days that I teach Me and JT
(08:06):
and a few others.
They're teaching that course.
And then, for the last threedays, tommy luciano is going to
come in and lead the course.
I'm going to help them with jtand the rest of the crew.
So it's going to be kind of aspecial thing.
It's going to be all of ourcollective information, complete
training program.
We've got a deal worked with alocal hotel so we can offer an
(08:29):
all-inclusive price.
We're really excited about that, dj.
Speaker 1 (08:33):
We think it's going to be a hit.
Oh, that'll be fantastic WithLuciano.
The place will be packed.
Speaker 3 (08:42):
We're doing it in Warrant, I agree with that.
We're doing it in Warrant, Iagree with that.
We're doing it in Warrington,missouri, which is out a little
bit west of St Louis.
We got some rural propertysecured so we can have some
hills and some ditches and wecan get a big heavy track
vehicle really stuck out thereas well.
We're going to I say hopefullytry to achieve I've never been
(09:04):
to the piece of property, butwe're going to achieve getting
it really stuck.
And we're talking, we're goingto get some heavy stuff to do
that with.
So it's going to be a real liveclass and the beauty of a class
like that is you attract peoplefrom all over the country.
So more information on that orany of our upcoming classes
(09:29):
910-747-9000 or wwwamtowriorgGot a great show lined up for
you.
Just come to drink.
Get rid of this frog in mythroat.
Hang around till after thebreak and we'll be right back.
Speaker 5 (09:50):
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Speaker 6 (10:07):
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Speaker 2 (10:41):
Information in this podcast is made possible by
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Henryswreckercom.
Speaker 1 (10:52):
Welcome back listeners.
Of course you know you'relistening to the number one
podcast in the towing andrecovery industry.
You are listening to theAmerican Towing and Recovery
Institute podcast with WesWilburn, dj Harrington, better
known as the Towing Doctor.
We every week bring youexciting episodes like this one.
By all means, download andlisten.
(11:15):
We're available on Spotify,itunes, pandora, stitcher,
iheartmedia the number onepodcast Amazon or wherever you
get your podcasts.
This is going to be a great one.
This man's been on before, so,wes, I'll turn it over to you.
Speaker 3 (11:33):
Thanks, dj.
I appreciate that I want tointroduce to some present to
others, our founding member,first member of the American
Tire Recovery Institute and agreat supporter of what we do,
fred Sheeler with Henry's RecordService.
Fred, introduce yourself to thegroup and I say Henry's.
(11:57):
I'm not even sure how I'msupposed to introduce you, so
help correct that for me.
Speaker 4 (12:02):
Yeah, wes hi.
As everyone, in case you don'tknow, I'm fred schiller.
I'm the executive chairman ofhws, which is henry's record
service, roadrunner recordservice and windsor town out of
baltimore, predominantly in thedmv area which is uh around dc
northern virginia, dc northernVirginia.
(12:23):
We have three companies.
We currently run roughly100,000 tow calls a year and
looking to grow and expand evenmore.
Speaker 3 (12:38):
Your group is what is called a consolidator
consolidating towing companiestogether.
Can you give a brief overviewof that in general on how that's
applying to the towing industry?
Speaker 4 (12:51):
Well, yeah, just like with the body shop industry and
other industries, the bestscenario I can give you is
Caliber Collision, which startedout with a couple body shops in
Texas, and the group has gonearound and bought up a lot of
independent shops and relabeledthem as Caliber Collision, so
they're now nationwide.
What we're doing.
(13:12):
I teamed up with a family fund,which is different from private
equity, and we are currentlypurchasing other companies.
I already had two when Ipartnered with them and we've
added a third one which isRoadrunner, and we're looking to
add another three.
Purchasing other companies.
I already had two when Ipartnered with them and we've
added a third one which wasRoadrunner, and we're looking to
add another three, hopefully bythe end of this year, yeah,
(13:35):
which would increase our revenueeven more, and we found out by
doing the Roadrunner deal thatwe were able to consolidate a
lot of stuff and get betterpricing from our vendors that
were more favorable towards usas a whole because of our volume
, and that goes from everythingfrom purchasing of trucks to
(13:55):
equipment, to insurance, theworkers' comp and just fuel was
another big savings off the topof my head, but it's worked out
really well.
Speaker 3 (14:09):
So let me describe this just a little bit for our
listeners.
Well, first of all, what's thename of your organization?
Speaker 4 (14:18):
The family fund is called Full Guard.
Speaker 3 (14:22):
Full Guard and you did mention private and family
trust.
I want to come back to that ina moment, but before we do that,
you talk about Henry's beingbig in Washington DC metro area,
which they are, which is alsowhere I grew up, and then
(14:43):
Roadrunner is also in the samemarketplace, but y'all basically
deal with two differentcounties.
I mean, you do business in thecounties, but one focus is one
county.
Loudoun, and one focus is thenext county.
Fairfax by joining together.
Tell us how that's helpedthings.
Speaker 4 (15:04):
Well, it expanded our local footprint, basically
doubled it, because now we havethe entire Loudoun County.
We do do some work in PrinceWilliam County through
Roadrunner.
Henry's also does work in theAlexandria side of this and
Arlington and Prince George'sCounty on the other side of the
Beltway in Maryland, and thenyou know, henry's also has
(15:26):
Montgomery County which is onthe other side of the Beltway in
Maryland, so we pretty muchencompass the entire Beltway in
DC region and by teamingtogether we're able to help our
customers out, because most ofour customers, you know, in the
DMV area, if you may be based inLoudoun, but your trucks of
your contracting company, yourtrucks are all over the place.
(15:47):
You're in DC, you're inMontgomery County, you're going
to be in PG County, princeWilliam County, et cetera.
It just allows us to give ourcustomers better service, better
response times, and they arewilling to pay for that.
Speaker 3 (16:02):
Well, that's good, and also by being closer and
better response times, it's alsoa more efficient call to run at
that point most of the timeisn't it?
Speaker 4 (16:11):
Yes, we're right now just over a year and a half into
the deal and we are in theprocess of syncing software.
Our GPSs have already beensynced up, but the big thing
will be syncing up our dispatchsoftware through what's it?
Traxo?
Traxo is the parent company, soit gives us better reporting
(16:38):
and better tools to use tomanage the locations and
everybody to work moreefficiently together.
So you're not sending trucksand passing trucks around.
Speaker 3 (16:51):
Boy, that makes a lot of sense.
That was always, I know, when Iwas in the business back here
decades ago at this point, lessempty miles the trucks were
running was better for everybody.
Speaker 4 (17:03):
Better for the money better for everybody's mentality
.
Exactly, and the drivers thenare able to make more money.
Also because, theoretically, ifyou're not running, on average,
15 miles to get to a call andyour average drops down to eight
to five miles to get to a call,you're able to run more calls,
which means more money in thepockets of the drivers.
Speaker 3 (17:25):
money in the pockets of the drivers because, as we
know, drivers drive the businessand that return comes back to
you as the ownership, as inbetter profitability, absolutely
(17:46):
um the two different type ofequity funds, trust funds that
are being used to financedifferent operations in the
general world of consolidation.
Can you talk about that for amoment?
Speaker 4 (17:53):
Yeah, sure you know, when I was going through this
phase of wanting to grow, how doI do it?
Speaker 2 (18:01):
And I know I needed a partner.
Speaker 4 (18:04):
So I went through what they call the dog and pony
show, had a bunch of differentgroups come in, lay the pros and
cons of what they felt theycould help me with and how they
would help, and the thing Ifound out with private equity is
they have just as much cash asthe family funds do.
But the difference is privateequity comes in.
(18:27):
There's a time limit, usuallyfive to seven years, maybe eight
.
They make the investment andthen they're going to want out
of the investment and get thereturns from the people that
they went and raised money from.
Family fund totally different.
Yes, they have raised money,but the money they raise is
(18:49):
people coming to them giving themoney and telling them to go
out and find businesses toinvest in and purchase.
There is no time limit on thatfund.
So, as you're growing yourbusiness, if they decide nobody
comes along and gives them amultiple that they really wish
for, or if the company's doingwell, there's no time frame for
(19:10):
them to sell their shares.
They'll stay in it for 10, 15,20 years, whereas an equity
comes in again wants to flip youand every other equity group
I've met with.
They all seem to think theyknow the towing business better
than you, the actual who builtthe business, and immediately
(19:33):
want to come in and make changes.
A lot of those changes arereflected in payrolls benefits.
There may be a few good thingsthey do that cut costs but they
again come in thinking they knowmore about business as a whole
than you do.
Family fun.
(19:54):
They leave the operations up tous.
They're there to support us,help us in any way and provide
cash when needed to do apurchase or grow the company.
Yeah, we go to them and explainwhy and if it's deemed
necessary and it's a good plan,they fund it.
Speaker 3 (20:19):
Which you know.
Actually it's all done from alogical standpoint, having
another set of eyes, that know afair amount about business.
Having another set of eyeslooking at things amount about
business.
Having another set of eyeslooking at things probably not a
bad thing, is it?
Speaker 4 (20:34):
No, it's actually a good thing, I would say there's
out of a couple ideas me and.
Dave Butcher, who was the ownerof Roadrunners now the president
of the group came up with andthere was one of them they
knocked down and when theyexplained why, it kind of made
sense to us and we agreed.
(20:56):
But everything else we'vewanted to do and explain to them
why we want to do it, theytotally understand it and have
been in full support of us.
They have never come in andsaid to us you need to cut
payroll, you need to do this orstop purchasing from this person
.
We think we can get you abetter deal on this or force you
(21:17):
to use relationships they havein insurance.
Um, they leave it up to us.
Operations are totally on us todo and obviously they expect
you to perform.
But but if you're an owner,you've already been performing.
So it's nothing new to havethat pressure of performance on
you and I say pressure, but it's.
It's the same as if you own thecompany yourself.
(21:39):
The only difference is I got achance to cash out a good chunk
of it.
Leave my 20% in and we'll growthe thing.
It's easier to grow somethingwith somebody else's money than
keep constantly putting your ownmoney out, for the risk is what
I always said, and there willbe a time maybe not tomorrow,
but there will be a time thatyou know they look to recoup
(22:01):
some of their investment and thecompany will probably be sold
again and at that point in timethe advantage to this way is I
get a second bite of the apple.
I got my first cash up front.
When they sell again I'll getanother chance to cash out again
.
Speaker 3 (22:20):
So let's talk about that a little bit.
I know you talked about it onprevious podcasts, but you sold
a large percentage of yourorganization to this group.
Explain how that works.
Speaker 4 (22:35):
All right, it's done in a stock deal.
So I sold them stock in thecorporation.
The company's name, your name,stays the same, nothing changes
your tax ID number, yourlettering on your truck DOT
number all that stays the samebecause it's not an asset
purchase.
Since they're purchasing stock,they give you X amount of
(22:57):
dollars based off of your EBITDAand multiple and that varies
depending on your EBITDA number,on the multiple.
So I cashed out, I kept 20%ownership in my stock and then,
as we go around purchasing theseother companies, I keep my
percentage of stock because Ihelp pitch in some money also
(23:19):
when we purchase these othercompanies.
So I have some skin in the gameand they know I'm making good,
sound decisions because it's mymoney also and we grow the
company and that next owner webuy also keeps the percentage in
.
So he has stock in the entirecompany, not just his company.
Now he now owns part of WindsorHenry's and Roadrunner.
(23:42):
If we were to do a deal, let'ssay tomorrow, with somebody,
they would now have a percentageof all three companies plus
their own company combined inthe parent company.
Speaker 3 (23:55):
All right.
So two questions come to mind.
But we're getting to the point.
We've got to take a break.
Can you hang around until afterthe break?
Of course I can.
Speaker 4 (24:05):
That's anything for you.
Speaker 3 (24:07):
We'll be right back listeners.
Speaker 2 (24:12):
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Speaker 1 (25:21):
We look forward to serving you.
Welcome back listeners.
You're listening to the numberone podcast in the towing and
recovery industry, the AmericanTowing Recovery Institute
podcast, with Wes Bilburn, djHarrington and our special guest
, of course, fred.
But let me remind all of you wehave over 15,000 listeners and
(25:44):
growing.
We can't thank you enough forsharing.
Remember to like and review.
Wes reminds you.
Please like, by all means.
If you want to hear anotherindustry expert like Fred, just
dial 706-409-5603.
That comes right to the podcastcenter and, just like the last
(26:07):
time he was on, very informative, very up-to-date.
Take out your pencils andpapers and learn from the master
.
All right, wes, I'll turn itback over to you.
Thank you, dj.
Speaker 3 (26:21):
And, fred, I thank you for sharing.
A couple of questions pop intomy mind.
Well, first of all, in thefirst segment I talked about the
Lynchburg Virginia class beingalmost sold out, and part of
that is y'all's participation,the Roadrunner and Henry
Director's Service.
I should have said that when Italked about the Lynchburg
Virginia class, so we doappreciate that, fred.
(26:42):
Two questions come to mindabout what we've talked about.
One is as you expand, doessomeone have to be right in your
area for y'all to work withthem?
And then also, is the businessdeal that you made with 80-20 or
(27:04):
whatever the percentages were?
Does the deal have to bestructured like that or are
there other variables?
Speaker 4 (27:12):
All right To answer the first part of your question
do you have to be in ourfootprint?
The answer is no, I can tellyou.
Currently, two of the companieswe're hoping to get a deal done
with are not within ourfootprint and are a know a good
bit away from us, which is finebecause they're well-run
(27:34):
companies.
Speaker 3 (27:35):
um, both those owners and that's the key right.
Speaker 4 (27:38):
Well, that's what you're looking for yeah,
well-run companies, who've, youknow, do their bookkeeping the
proper way, pay all their taxes.
You know everything is recordedproperly.
And both those owners also wishto stay on and see the bigger
picture of growing the business.
(27:59):
And you know we're here to helpthem grow their business and
connect, you know, connect thedots, as we call it, across the
map in major areas.
So, yes, those owners will stayon and the percentage it can
vary.
You can do 20 percent, 15, 10,you know it varies back and
(28:21):
forth.
Speaker 3 (28:22):
But people have to stay with skin in the game.
Speaker 4 (28:25):
That's what I was getting to no, they do not have
to stay with skin in the game.
That's what I was getting to.
No, they do not have to staywith skin in the game.
But what will?
I would say we would like themto stay on for at least, if
they're not going to have anyskin in the game two years and
we'll give them a two-yearemployment contract.
That is very favorable, whichyou know, that's how I started
(28:46):
out with the two-year contract,which you know that's how I
started out with.
It was with a two-year contractand then it extended to
indefinitely, and same with Dave, because we see the bigger
picture.
But you know, you can do anasset purchase also, which we
looked at on a couple smallercompanies.
At possibly doing that, wewould just be able to, you know,
(29:08):
relabel the trucks and justfold them into the umbrella
already, and there are somereasons for those, because
they're not really running asolid EBITDA number but
strategically it makes sense andthey're close enough that we
can take over the management ofthe companies.
But there again, well-runcompany, if you have somebody
(29:34):
underneath of you, which youshould, as an owner, always be
trying to train somebody to bethe next owner and take your
place, even if you don't sell.
So you have more time forfamily and other activities that
you wish to do.
And that's how I approached it.
When I was growing henry's wasmaking sure I had the staff
underneath me and the rightpeople in place that I could
(29:55):
afford to go on a three-weekvacation or leave the state and
stuff, and a lot of owners won'tdo that because they're afraid
that person leaving or takingtrade secrets.
But you need to grow your ownpeople.
Well, that's good advice, nomatter where you are in business
(30:15):
.
Oh yeah, you as an owner, Imean you bust your.
It's to reward yourself,indulge in a couple little
things and take that family time, because it goes by fast, as we
all know.
Speaker 3 (30:28):
That it does that it does EBITDA.
Quick explanation of that, oh.
Speaker 4 (30:37):
EBITDA.
Speaker 3 (30:38):
EBITDA.
Speaker 4 (30:39):
Earnings before interest taxes, amortization,
depreciation, Depreciation,amortization.
Excuse me, Got it backwards.
Speaker 3 (30:51):
And those are numbers folks should be paying
attention to, right.
Speaker 4 (30:54):
Correct.
And your accountant I mean Iget it, I'm not the financial
wizard, but my CFO at the timeor your comptroller or your
accountant, should be able totake your financials, whether
you're doing quarterly, monthly,yearly and tell you what that
number is.
And that is the multiple thathas been used, or the formula
(31:19):
used since the 80s of evaluatingthe business.
And then there's a multiple puton it.
Sometimes it's as low as three,sometimes it can be high as
double digits, depending on that.
Speaker 3 (31:33):
EBITDA number and that's something that we talked
about in the previous podcastthat I'm going to challenge our
listeners to go back and listento is in great detail.
You explained the importance ofbeing accurate with those
numbers, and I say in greatdetail in a very down-to-earth
way.
Right now I want to shift gearsfor the few minutes we have
(31:55):
left.
What's going on around youroperating area and I hear
Virginia is looking at somethings.
I'm also interested in anyopinion you have on what's going
on on the federal junk fees andwhatnot on the federal level.
Speaker 4 (32:15):
Yeah, in Virginia my group, Northern Coalition of
Towers, lobbied Virginia Senateand House to regulate which they
already.
Let me back up.
They already regulate trespasstelling prices in the state of
Virginia but to get an increaseyou have to go back every year,
(32:39):
every so many years.
Convince the lobbyists I meannot the lobbyists, the senators
and the House representatives towant to increase your rates.
And no senator or lobby ormembers of the House wants the
vote usually to give towers anincrease.
They're afraid theirconstituents will be mad at them
and won't vote for them for thenext election.
(32:59):
So what we propose is that it'staken out of their hands and
put into the hands of the SEC,which regulates all businesses.
Let them set the rate.
They are impartial.
They are not tied by politicalbounds or parties or
constituents.
(33:21):
So what they decided to do wasdo a study.
The state funded it.
They hired a firm out of I wantto say it was Utah who was
doing the study on what a costand the rates that we should be.
They're going to propose ratesthat we should be getting for
those gas tows.
Those rates will be set andonce that is approved which we
(33:48):
feel will be approved this nextsession, then every year after
that we are lobbying that wetake the CPI index from the
transportation department andthat will be the increase that
is given every yearautomatically.
So if the transportation indexis 4%, our rates automatically
(34:08):
go up 4% across the state.
There's no going back andrenegotiating with the senators
and house representatives, itjust goes up.
Then possibly every five years,if the state wants to double
check everything, hire the firmagain.
Let them do another study.
This way it takes out thepolitics out of towing, which
(34:32):
they really shouldn't be in.
We're a business like any otherbusiness.
I don't feel that just becausesomebody doesn't like tow
companies that they shouldn'tvote for us to get a raise Right
.
So I believe it's a good thingfor the industry.
A lot of people don't likeregulations.
They're afraid it's going toopen the door up to something
(34:53):
else.
But we made it clear in ourbill this is all they are
regulating.
They're not regulating whetherwe have to get second signatures
or how we do the tow, uh, whatrecords we have to keep.
It's just strictly based on theprice of doing business, which
I think helps all the towers inthe state absolutely taking it
(35:17):
away from a politicalconsideration, absolutely what
do?
Speaker 3 (35:21):
you think about what's going on with the Fed and
junk fees?
Speaker 4 (35:26):
All right, the Fed and junk fees.
That's a good one.
They're considering our junkfees, basically our admin fees,
from what I read on it, sayingthat there are extra fees no
different than when you go to anairline and all of a sudden
they're charging you a check bagfee.
Well, if you want to take thataway, that's fine.
(35:49):
But in reality, here's what'sgoing to happen.
If Southwest Airlines, forexample, or any airline, is
charging you, let's say, $50 tocheck a bag, well, what's going
to happen is, whether you checka bag or not, your ticket price
is going to go up $50 to check abag.
Well, what's going to happen is, whether you check a bag or not
, your ticket price is going togo up $50 and they're going to
get rid of all check bag fees.
But whether you're checking thebag or not, you're paying that
(36:11):
$50 extra on your airline ticket.
If your ticket normally costsyou 200 bucks, it's now going to
cost you 250, plus taxes.
Same thing with towing.
They're talking about our adminfees, but by law we are
supposed to be sending out thesenotices.
So what's going to happen isthose admin fees are just going
to get lined up and added on tothe charge of the tow.
So you're really not solvingany problem.
(36:36):
The consumer is still going topay the same price for the tow,
it doesn't, or the airlineticket or whatever else they're
calling junk fees, just likewith hotels.
You know, I get it.
Hotels kind of hide the resortfees.
You know you see theadvertisement for the room and
then real small print resort feeof 25 a day oh, yeah, yeah, you
know what I?
mean so, just so.
(36:56):
So, just, I feel that and I'vealways felt this way, uh, even
when it was comes to towing andespecially trespass towing a lot
of counties and municipalitiesI've dealt with over the years
want to break all the chargesdown.
There's a hookup charge,there's a dolly fee charge,
there's an afternight charge,there's a weekend charge,
(37:17):
there's a holiday charge.
There are some states andmunicipalities that you can
charge extra.
Why not just make it one flatbill?
It makes life so much easier.
The consumer walks in, sees thebill Okay, it's $225, for
example.
Okay, well, you can get to that$225 by having $150 hookup, $50
(37:41):
for dollies and then another$50 for nighttime and weekend
fees.
And they look at those fees,separate it and they feel
they're getting ripped off.
More so, in my opinion, than ifI got a bill that said $250 is
the cost of the tell.
Speaker 3 (37:57):
Yeah, I can't.
Speaker 4 (37:59):
Because then they number one.
They're not really.
The question isn't how much thebill is when they look at it,
when it's completely broken downto all these separate fees.
The question is well, wait aminute, why did you charge
dollies on my car?
You should have had to dolly mycar.
It didn't need dollies.
But we know that is a safer wayto tow a car is with dollies
and dragging it from behind.
And it's just.
(38:23):
They're more going to argue withwhy their car was towed when
you had the photographicevidence to show them.
Simple and dumb.
When you have to explain thefees and the amount you're
charging, everybody's going tosay well, the state says I can
charge for dolly, so we dolliedyour car and charged you, didn't
matter whether it needed it ornot.
Most tow companies charge itand the drivers will dolly it.
So they're gonna argue over anadmin fee.
(38:45):
They're gonna argue it's just.
Why'd you tow my car?
You waited till after I wasparked there all day.
Why'd you wait till after nightto tow it?
So you charge me the extra fee?
Just incorporate everything inone fee is my opinion.
Yeah, that fee is going to behigher for some customers who
would have just paid a flat fee,but it's a lot easier when
(39:08):
you're dealing with a consumer.
You're still going to make yourmoney because all the other
fees are incorporated into thatone flat price.
Speaker 3 (39:15):
That's right.
Speaker 4 (39:17):
And I believe it's just less arguing.
Then the only argument thatcustomer has when they come to
pick up their car is why youtowed me.
That's it.
They're not arguing overdollies or go jacks or uh, you
know all these other littlemiscellaneous charges.
Whether it was towed aftereight o'clock at night, whether
it was towed before eighto'clock at night, how many miles
the car was towed back to thestorage lot.
(39:39):
I just believe in flat ratesfor specially trespassed towing.
It just makes life easier, Ifeel, on your employees at the
counter and on the consumer,because they don't feel like
they're being all these littleadditional charges added on to
take advantage of them.
Speaker 3 (39:58):
Yeah, it makes crystal clear sense.
As much as you can share thatsame mindset with your police,
authorized towing, don't you?
Speaker 4 (40:10):
Yes, you know, with our police authorized towing, it
is a contract.
The prices were set on thiscontract around but they took a
lot of input from the towers andgave us fair pricing in the
hookups.
And you know I am reallyfortunate being in Northern
(40:31):
Virginia and Fairfax County thatthe contract that they use and
the police officers that are onthat contract and the purchasing
department, they understand thebusiness.
They've been around thebusiness.
A lot of them have had parentswho were in trucking or some
form of business.
(40:51):
They understand that we're nota nonprofit, that we are here to
make money and they alsounderstand they don't want to
feel that the consumer is gouged.
So they sat down with us andthey look at the rates and they
asked us questions and we gavethem information.
They came up with a reallygreat fair rate.
That's a flat rate.
(41:11):
Whether you tow a car for thepolice department, it's on a
flat bed, a wheel lift hasdollies, no dollies.
Um, they left the recovery partup to us and as long as we are
able to justify what we chargein recovery, they're fine with
it.
And my last conversation abouta month ago was things are going
(41:35):
great on our contract, which isa 10 year contract and we're
only a year and a half into itwith the pricing structure and
we get automatic increases at arate of no higher than 3%, based
on the CPI.
Speaker 3 (41:50):
That's excellent.
I mean, you can't ask for muchmore than that, especially in
the towing world.
Speaker 4 (41:55):
No, you can't.
And again, they understand thatthere's going to be exceptions
to the rule.
You know you have that onetractor trailer that's rolled
over down an embankment orhanging off a bridge or loaded
down with diesel fuel or justfuel in general, or in their
cleanup.
The key and I feel a lot oftours miss this is in their
(42:15):
documentation.
Really take good pictures, butwhen you write up your invoice,
don't just give them an invoice,give them a complete, detailed
subscription, time on scene,what you had to do, what
equipment was used, when it wasused.
And I find that 90% of the timeI wind up getting my bill paid
(42:39):
in a reasonable amount and paidin full.
There's always that 10% outthere that refuse and think
everything's overpriced.
But that's what the courtsystems are for and fortunate
enough in Virginia if I sue atrucking company and I win, no
matter what the dollar amount is, I win.
They also have to add on thereand pay my attorney bills.
Speaker 3 (43:05):
That's substantial.
Speaker 4 (43:07):
Which is a law we got passed about two years ago.
It went into effect and theother thing I can tell you is I
was lucky enough to stumbleacross a great attorney who not
only sues the trucking companybut he also goes after the owner
of the cargo because it's theirresponsibility and they're
(43:28):
paying somebody to haul theircargo around.
That person carries enoughinsurance in case something does
happen, because a lot of timesyou hear that, oh well, the
cargo coverage is already usedup to pay for the cargo, so
there's no money left over.
Um, even if it's a liabilityclaim and you're just, you know,
(43:48):
for restoring the flow oftraffic you're charging for, you
can't actually charge for thetower storage, but go after the
the cargo.
Uh, there's no law that saysyou can't sue the person who
owns the cargo and the broker,because there's another person
involved.
Usually that broker is thecargo to these independent
truckers and other companies.
Speaker 3 (44:09):
That's the whole reason.
They should be involved in casesomething does happen,
including a wreck or whatever.
That's the whole reason for abroker.
I understand it, one of themain reasons.
Speaker 4 (44:20):
Let me word it like that and I had a case.
It took me about a year and ahalf but we won it and we ended
up going after the cargo holderand the broker, suing both of
them in federal court and we won.
They were responsible and whatended up happening is the broker
(44:43):
ended up Paying out of hispocket to us For the tow bill
because he did Not want to losehis relationship With the person
who owns the cargo because theyShip so much cargo and make so
much money Off of them a year.
So the broker actually belliedup the money To pay the tow bill
and recovery and storage.
So there's a lot of ways to goafter to pay the tow bill and
recovery and storage.
(45:03):
So there's a lot of ways to goafter nowadays and there's no
reason why, because they'reresponsible for their cargo,
they can say well, no, I gave itto the broker.
The broker made sure the personhad the property.
Well, guess what?
Your broker didn't do his job.
That still doesn't make youunliable.
You're liable for your cargo.
Speaker 3 (45:23):
Wow, that's an excellent point.
Now quick question Are theseissues something that if someone
was part of your umbrellaworking with y'all, that y'all
would provide help with?
Speaker 4 (45:37):
Of course, of course, that's what we all do.
We operate as one company.
Of course, of course that'swhat we all do.
We operate as one company.
They may be separate names andbe in separate locations,
whether they're in a separatecounty or a separate state or
even a separate region.
We all work together as onecompany when it comes to stuff
like this workers' comp, truckinsurance, employee benefits,
(46:00):
making sure that all theemployees have the same benefits
.
And if by chance, we purchase acompany, a partner with another
company and they are providingbetter benefits than we are,
then it's a win for everybodywho's already an employee of
ours, because all those benefits, then we match them to make
sure they're better.
(46:22):
So let's say, for example, ifyou're, if you, if you pay a
hundred percent of youremployees health insurance and
we were to purchase your, your,your company, well, we're not
going to tell your employees,well, now you're not not getting
a hundred percent of yourhealth insurance covered, right,
that wouldn't be fair to youremployees, that's not up to what
we do by purchasing yourcompany.
(46:44):
We look at that and say youknow what?
We need to up our standards forour employees.
I feel right now we have one ofthe highest standards for
employees when it comes tobenefits, whether it be their
401k, match their life insurance, dental insurance, health
insurance.
I feel we have a really, really, really good compensation
(47:05):
package on that, and you know.
But if somebody out there hasit better and we decide that
we're going to partner with them, then their employees aren't
going to.
Benefits aren't going to godown.
Our employees will go up Iftheir benefits aren't as good as
ours.
Their employees that work forthem benefits go up to match
ours.
Speaker 3 (47:26):
Well, many of the biggest service providers in the
country and over the world werefounded and grew on these same
principles, so it's nice to seethis business logic being
applied to the towing industry.
Speaker 4 (47:42):
To me it's an ethical thing.
How can I come in and partnerwith you and then take away from
your employees?
The whole object of thepartnership is to benefit the
company.
When I say company, that's tobenefit every employee that's
working there, not just theowner because he's getting a
chunk of change.
(48:02):
It's to benefit the individualemployee, whether they're the
dispatcher, the yard person, thecar release person.
It's to benefit them all.
And then that helps build theteamwork effort and just lift
everybody up, because as you'regrowing, you want to lift
(48:22):
everyone up that you'reaffecting.
Speaker 3 (48:24):
You want to lift them up with you.
Absolutely, absolutely.
Well said, fred, how doessomeone get in touch with you if
they want to get moreinformation?
Do you have an email?
Speaker 4 (48:37):
Yeah, sure, my email is fred underscore S as in Sam
at henrysreckercom.
All one word, or they can evenreach out on our phone at
1-324-1954.
Speaker 3 (48:57):
You bubbled a little bit.
Give me that number again.
Speaker 4 (49:01):
What did you say?
Wes you kind of bubbled on methat time.
Yeah, give me that number onemore time.
It was a little bit.
Give me that number again.
What'd you say?
Wes you kind of bubbled on methat time.
Speaker 3 (49:04):
Yeah, give me that number one more time.
It was a little bubbly the 301part of it.
So give me the whole thingagain please.
Speaker 4 (49:10):
Yes, 301-324-1945.
Excuse me, 540.
Speaker 3 (49:20):
Now you got me mixed up.
Yeah, I tend to do that, fredyeah, I noticed that over the
years there you go well.
Thank you for a great interviewand some great information to
the other consolidators, if anyof them out there listening.
I keep hearing you are we'dlove to have you all on.
We do have Jay and I out of StLouis going to be on with us in
(49:43):
one of the upcoming episodes.
There's a whole bunch of therest of you out there.
If you're interested, come onand tell us what you're doing.
Speaker 4 (49:52):
One more thing I'd like to add to that these other
groups that are consolidating,free to reach out.
We're not afraid of going.
You know, if you alreadyconsolidated, let's say, eight
companies or five companies,whatever it is, we're not afraid
to take a look at that either.
Excellent, there's plenty ofopportunity out there for
(50:14):
everyone right now and you knowI got to.
I have a feeling that you knowagain, it starts out by the
these groups doing consolidation, and then these groups
consolidate with one another andpartner up and it's just going
to keep growing from there, andwe are always open to something
like that also.
Speaker 3 (50:32):
That's good to hear and you know some people are
scared of this.
But if you step back and lookat the big picture, this is
nothing but good for theindustry and for the employees
working in the industry andwhole, and also for the small
business owner that'shardworking and is able to
capitalize on some of their hardwork to secure their family's
(50:54):
generational wealth.
I always think that's reallygood for a lot of hardworking
company owners.
Speaker 4 (51:02):
I would like to say that, too, a lot of the
mom-and-pop places and thesmaller companies are afraid of
this.
In reality, they should embraceit and try and get in at the
ground level when this isstarting, because their
percentage of shares will onlygo up in value as it grows.
Just like if you look at theperson who got involved in Apple
when Apple was just startingout right, his shares grew over
(51:26):
the years to where he's now abillionaire Over.
So it's no different.
Now I'm not saying you'll endup being a billionaire, but I
would gladly say you would be amillionaire over.
You know, it's just you get inearly and you help make it the
right company.
Yeah, but you're put your stampon it.
(51:47):
You know, grow, help us grow,and it's always nice to look
back and say, hey, I was a partof this, that's right.
Speaker 3 (51:56):
And the other thing is, by being a part of something
like this, it allows you tohave a life with your family.
Yeah, part of something likethis allows you to have a life
with your family yeah, it doesin the business you love but not
have to dedicate so much ofyour life to it.
Speaker 4 (52:09):
You know, I hear a lot of owners saying well, wait
a minute, I don't want to do itbecause me and my son's coming
up.
He's definitely going to berunning the company.
He's in his early 20s and ormid-20s and I want him to take
over the.
Hey, that's great, that canstill happen.
But not only him to take over.
Hey, that's great, that canstill happen.
But not only can he take overyour company.
With this partnership, he couldmove up in the ranks and maybe
(52:30):
take over and be in charge ofthree or four companies or a
whole region and make more anddo more and have more life than
you did building the business.
So don't feel like you'reshutting the opportunity out on
your son or daughter who's goingto take over the business,
because they're going to sellyou the business.
(52:51):
You have to sell it to them.
They're going to have to makepayments to you.
I'm sure and that's how youlook at it, that's being your
retirement is your son ordaughter take over the business
and they make monthly paymentsto you.
But there's really no guarantee, is there?
At least this way, I feel youhave a better guarantee because
you get a good chunk of themoney up front, you still have
the opportunity for your son,daughter to grow with the
(53:13):
business.
You can give them your shares,even and part of.
Speaker 3 (53:17):
And again, people should go back and listen to one
of the two others that I canthink of off the top of my head
where we talked about this withFred.
We talked about if you own yourreal estate, they're renting at
a fair market value, theemployment contract, how you
(53:37):
found that to be favorable.
So I do challenge people to goback and listen.
Fred, I hate to cut you off butwe're out of time.
Thanks for a great interviewtoday and again, thanks for your
long-term support.
You're number one member, firstperson to sign up for the
Institute when we started it,and I'll never forget you for
that, fred, thank you so much.
Speaker 4 (53:59):
It's my pleasure to be able to help our industry
become safer, looked at as moreprofessional industry over the
years.
Wes, I'm glad you took the timein your life to dedicate it to
do this for our industry.
I can't count on fingers howmany lives you saved over the
years by doing your instructionclasses and always preaching
(54:22):
safety in your first.
Job Description is to alwayscome home safe every night to
your family.
That's right.
Speaker 3 (54:28):
God bless our listeners.
Be safe Till the next time.
Welcome one and all to the American Towing Recovery
Institute podcast.
Remember this is your podcastto promote safety, education,
positive public relations andnetworking within the
professional and business-mindedtowing and recovery industry.
I'm your co-host, dj Harrington, better known as the Tow Doctor
(00:27):
, and my other host is WesWilburn, over 40-year towing
industry veteran, the founder ofAmerican Towing Recovery
Institute of Fayetteville, northCarolina.
He has produced and conductedtraining and certification
programs for leading towingcompanies, equipment
(00:48):
distributors, towingassociations, dot, fire
departments, rescue, as well asmilitary installations across
the United States.
Wes has been published over 100times in major towing
publications published over 100times in major towing
(01:08):
publications.
Wes has developed many courses,including the most recent
awareness-level course for allresponders that specialize in
electric vehicles as well ashybrid, natural gas and hydrogen
vehicles.
Wes has provided insight as themain speaker for over 30 years
at more than 900 trainingclasses and has been recognized
(01:31):
as one of America's greatesttowing trainers.
He is well known for hisstraightforward but
down-to-earth teaching style.
West Wilbur and his AmericanStorm Recovery staff have
developed an electric vehiclephone app, wwwev-clevercom, with
(01:54):
over 700 passenger vehicles andover 100 heavy-duty vehicles,
bringing you a new level ofconvenience for information at
your fingertips for allresponders and their groups
Without further ado.
Here's my dear friend and agreat guy for our industry, wes
(02:14):
Wilber.
Speaker 3 (02:15):
As always, DJ, I appreciate your kind words.
You're too kind.
It was really a godsend when wegot introduced together.
I have to admit, DJ, Iappreciate you more than you
know.
Speaker 1 (02:27):
Well, vice versa, I am so proud to be your
co-partner on this deal.
I'm proud to be with you, wes,but I'm proud to be part of this
industry because you really docare about the end user.
You care about the one outthere working the white line, so
(02:48):
I'm very proud to be part of it.
So tell all our listenerswhat's happening this week,
because we got a great guest.
I know that Well, as I'mrecording this.
Speaker 3 (02:59):
I'm getting ready to go to Rhode Island for a class,
but if people will be, listeningto it that class will have just
happened.
We can't mention that.
Or we also wanted to give ashout-out for the North Carolina
show, like we did in the lastepisodes.
Yes, that will already havepassed when people listen to it.
I hope they had a good strongshow there, Coming up right
(03:20):
before the week when people willbe listening to this will be
the Roberts Center the MidwestRegional Toe Show, September
12th through the 15th.
It's at Roberts Center,Wilmington.
Speaker 2 (03:31):
Ohio.
Speaker 3 (03:32):
Great show, I know you're going to be involved
there with many different thingsand we had Bruce on the program
.
I guess what two episodes DJDoes that sound right.
Yes.
And he's got a lot of greatthings planned this year A
parade and a hog picking.
(03:53):
I believe it was pig picking.
I don't know if they call itpig picking in that part of the
world.
Dj.
Speaker 1 (03:59):
Yeah, celebration of Life is where we're going to
remember all the loved ones,whether you were killed on the
white line or just maybe a heartattack in the office or out
fishing with your son.
We want to remember anyone inthe towing industry, so it's
called Celebration of Life,which is that Thursday night.
(04:21):
Then, as a thing that youpromote all the time, this is
the Wounded Driver Fund and Wes.
You know, you're a real reasonwhy they started all that and
that's been very, verysuccessful and I'm speaking
there and, of course, you sentme stuff to.
They're going to raffle off upthere and I'm bringing it with
(04:45):
me and it's a donation from theamerican towing and recovery
institute.
So, uh, you're a very kind guyand a lot of people don't know
how much you do for the industrywell, thanks, dj.
Speaker 3 (04:58):
I appreciate that.
Um, we'll be at LynchburgVirginia.
On September, the 20th we'redoing an electric vehicle class.
That's Friday evening 6 to 9.
That's a free class.
We're going to feed you dinnerat 5 o'clock, so get there a
(05:19):
little bit early.
And on the 21st 22nd, lynchburgVirginia, we're doing a heavy
duty class with some rotatorusage, heavy duty, towing and
recovery.
September 21, 22,.
That class is about a littlebit over halfway filled up right
now.
Speaker 1 (05:36):
So we're looking forward to that September the.
Speaker 2 (05:43):
Tennessee Toe Show September 25-28.
Speaker 3 (05:46):
Contact Brenda at toetimesmagcom for more
information and then the firstweek of October we'll be out in
Oregon it's a private school.
I think they've got it aboutfilled up.
Then the next class will be inlake station, indiana our good
(06:15):
friends at wafco october 18thelectric vehicle class.
It's three hours on a fridayevening 19th and 20th, heavy
duty with some rotator usage.
November 2nd and 3rd we'll beback in Elkhart, indiana, with a
light to medium duty class,two-day class, full-blown
hands-on.
And then the last public classof the year at this point is
November 16th 17th 2024, two-dayfire tower cross training in
(06:41):
Sumner, south Carolina.
It's a fire department crosstraining will be myself and ron
moore teaching the class, sowe'll look forward to seeing
some of our friends there.
Sumner tower is a great friendof the podcast.
I've got a youtube channel thatthey're very active relatively
active, I guess, would be theright term and and really nice
(07:02):
folks.
Hal Watts, the principal thereat Sumner Record, is a paid
firefighter.
Very instrumental on helpingcross-train between a small
department and the community.
So we're looking forward to agreat class there also, DJ.
(07:23):
I want to talk about one morething before the break.
Next year, early May, we'relooking forward to a great class
.
I want to talk about one morething before the break next year
, early May we're doing acomplete training class started
light duty all the way throughheavy duty.
We talked about doing it bootcamp style.
I don't think we are at thispoint.
Boot camp style is when youcheck in at one time and you
(07:44):
don't check out until a weeklater and you're involved in the
class the whole time.
I do not think we're going todo that.
I do believe what we're goingto do is teach a class like we
normally do, but we might have acouple evening sessions.
First day is going to be lightduty.
Second day is heavy duty, thetwo days that I teach Me and JT
(08:06):
and a few others.
They're teaching that course.
And then, for the last threedays, tommy luciano is going to
come in and lead the course.
I'm going to help them with jtand the rest of the crew.
So it's going to be kind of aspecial thing.
It's going to be all of ourcollective information, complete
training program.
We've got a deal worked with alocal hotel so we can offer an
(08:29):
all-inclusive price.
We're really excited about that, dj.
Speaker 1 (08:33):
We think it's going to be a hit.
Oh, that'll be fantastic WithLuciano.
The place will be packed.
Speaker 3 (08:42):
We're doing it in Warrant, I agree with that.
We're doing it in Warrant, Iagree with that.
We're doing it in Warrington,missouri, which is out a little
bit west of St Louis.
We got some rural propertysecured so we can have some
hills and some ditches and wecan get a big heavy track
vehicle really stuck out thereas well.
We're going to I say hopefullytry to achieve I've never been
(09:04):
to the piece of property, butwe're going to achieve getting
it really stuck.
And we're talking, we're goingto get some heavy stuff to do
that with.
So it's going to be a real liveclass and the beauty of a class
like that is you attract peoplefrom all over the country.
So more information on that orany of our upcoming classes
(09:29):
910-747-9000 or wwwamtowriorgGot a great show lined up for
you.
Just come to drink.
Get rid of this frog in mythroat.
Hang around till after thebreak and we'll be right back.
Speaker 5 (09:50):
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Speaker 1 (10:52):
Welcome back listeners.
Of course you know you'relistening to the number one
podcast in the towing andrecovery industry.
You are listening to theAmerican Towing and Recovery
Institute podcast with WesWilburn, dj Harrington, better
known as the Towing Doctor.
We every week bring youexciting episodes like this one.
By all means, download andlisten.
(11:15):
We're available on Spotify,itunes, pandora, stitcher,
iheartmedia the number onepodcast Amazon or wherever you
get your podcasts.
This is going to be a great one.
This man's been on before, so,wes, I'll turn it over to you.
Speaker 3 (11:33):
Thanks, dj.
I appreciate that I want tointroduce to some present to
others, our founding member,first member of the American
Tire Recovery Institute and agreat supporter of what we do,
fred Sheeler with Henry's RecordService.
Fred, introduce yourself to thegroup and I say Henry's.
(11:57):
I'm not even sure how I'msupposed to introduce you, so
help correct that for me.
Speaker 4 (12:02):
Yeah, wes hi.
As everyone, in case you don'tknow, I'm fred schiller.
I'm the executive chairman ofhws, which is henry's record
service, roadrunner recordservice and windsor town out of
baltimore, predominantly in thedmv area which is uh around dc
northern virginia, dc northernVirginia.
(12:23):
We have three companies.
We currently run roughly100,000 tow calls a year and
looking to grow and expand evenmore.
Speaker 3 (12:38):
Your group is what is called a consolidator
consolidating towing companiestogether.
Can you give a brief overviewof that in general on how that's
applying to the towing industry?
Speaker 4 (12:51):
Well, yeah, just like with the body shop industry and
other industries, the bestscenario I can give you is
Caliber Collision, which startedout with a couple body shops in
Texas, and the group has gonearound and bought up a lot of
independent shops and relabeledthem as Caliber Collision, so
they're now nationwide.
What we're doing.
(13:12):
I teamed up with a family fund,which is different from private
equity, and we are currentlypurchasing other companies.
I already had two when Ipartnered with them and we've
added a third one which isRoadrunner, and we're looking to
add another three.
Purchasing other companies.
I already had two when Ipartnered with them and we've
added a third one which wasRoadrunner, and we're looking to
add another three, hopefully bythe end of this year, yeah,
(13:35):
which would increase our revenueeven more, and we found out by
doing the Roadrunner deal thatwe were able to consolidate a
lot of stuff and get betterpricing from our vendors that
were more favorable towards usas a whole because of our volume
, and that goes from everythingfrom purchasing of trucks to
(13:55):
equipment, to insurance, theworkers' comp and just fuel was
another big savings off the topof my head, but it's worked out
really well.
Speaker 3 (14:09):
So let me describe this just a little bit for our
listeners.
Well, first of all, what's thename of your organization?
Speaker 4 (14:18):
The family fund is called Full Guard.
Speaker 3 (14:22):
Full Guard and you did mention private and family
trust.
I want to come back to that ina moment, but before we do that,
you talk about Henry's beingbig in Washington DC metro area,
which they are, which is alsowhere I grew up, and then
(14:43):
Roadrunner is also in the samemarketplace, but y'all basically
deal with two differentcounties.
I mean, you do business in thecounties, but one focus is one
county.
Loudoun, and one focus is thenext county.
Fairfax by joining together.
Tell us how that's helpedthings.
Speaker 4 (15:04):
Well, it expanded our local footprint, basically
doubled it, because now we havethe entire Loudoun County.
We do do some work in PrinceWilliam County through
Roadrunner.
Henry's also does work in theAlexandria side of this and
Arlington and Prince George'sCounty on the other side of the
Beltway in Maryland, and thenyou know, henry's also has
(15:26):
Montgomery County which is onthe other side of the Beltway in
Maryland, so we pretty muchencompass the entire Beltway in
DC region and by teamingtogether we're able to help our
customers out, because most ofour customers, you know, in the
DMV area, if you may be based inLoudoun, but your trucks of
your contracting company, yourtrucks are all over the place.
(15:47):
You're in DC, you're inMontgomery County, you're going
to be in PG County, princeWilliam County, et cetera.
It just allows us to give ourcustomers better service, better
response times, and they arewilling to pay for that.
Speaker 3 (16:02):
Well, that's good, and also by being closer and
better response times, it's alsoa more efficient call to run at
that point most of the timeisn't it?
Speaker 4 (16:11):
Yes, we're right now just over a year and a half into
the deal and we are in theprocess of syncing software.
Our GPSs have already beensynced up, but the big thing
will be syncing up our dispatchsoftware through what's it?
Traxo?
Traxo is the parent company, soit gives us better reporting
(16:38):
and better tools to use tomanage the locations and
everybody to work moreefficiently together.
So you're not sending trucksand passing trucks around.
Speaker 3 (16:51):
Boy, that makes a lot of sense.
That was always, I know, when Iwas in the business back here
decades ago at this point, lessempty miles the trucks were
running was better for everybody.
Speaker 4 (17:03):
Better for the money better for everybody's mentality
.
Exactly, and the drivers thenare able to make more money.
Also because, theoretically, ifyou're not running, on average,
15 miles to get to a call andyour average drops down to eight
to five miles to get to a call,you're able to run more calls,
which means more money in thepockets of the drivers.
Speaker 3 (17:25):
money in the pockets of the drivers because, as we
know, drivers drive the businessand that return comes back to
you as the ownership, as inbetter profitability, absolutely
(17:46):
um the two different type ofequity funds, trust funds that
are being used to financedifferent operations in the
general world of consolidation.
Can you talk about that for amoment?
Speaker 4 (17:53):
Yeah, sure you know, when I was going through this
phase of wanting to grow, how doI do it?
Speaker 2 (18:01):
And I know I needed a partner.
Speaker 4 (18:04):
So I went through what they call the dog and pony
show, had a bunch of differentgroups come in, lay the pros and
cons of what they felt theycould help me with and how they
would help, and the thing Ifound out with private equity is
they have just as much cash asthe family funds do.
But the difference is privateequity comes in.
(18:27):
There's a time limit, usuallyfive to seven years, maybe eight
.
They make the investment andthen they're going to want out
of the investment and get thereturns from the people that
they went and raised money from.
Family fund totally different.
Yes, they have raised money,but the money they raise is
(18:49):
people coming to them giving themoney and telling them to go
out and find businesses toinvest in and purchase.
There is no time limit on thatfund.
So, as you're growing yourbusiness, if they decide nobody
comes along and gives them amultiple that they really wish
for, or if the company's doingwell, there's no time frame for
(19:10):
them to sell their shares.
They'll stay in it for 10, 15,20 years, whereas an equity
comes in again wants to flip youand every other equity group
I've met with.
They all seem to think theyknow the towing business better
than you, the actual who builtthe business, and immediately
(19:33):
want to come in and make changes.
A lot of those changes arereflected in payrolls benefits.
There may be a few good thingsthey do that cut costs but they
again come in thinking they knowmore about business as a whole
than you do.
Family fun.
(19:54):
They leave the operations up tous.
They're there to support us,help us in any way and provide
cash when needed to do apurchase or grow the company.
Yeah, we go to them and explainwhy and if it's deemed
necessary and it's a good plan,they fund it.
Speaker 3 (20:19):
Which you know.
Actually it's all done from alogical standpoint, having
another set of eyes, that know afair amount about business.
Having another set of eyeslooking at things amount about
business.
Having another set of eyeslooking at things probably not a
bad thing, is it?
Speaker 4 (20:34):
No, it's actually a good thing, I would say there's
out of a couple ideas me and.
Dave Butcher, who was the ownerof Roadrunners now the president
of the group came up with andthere was one of them they
knocked down and when theyexplained why, it kind of made
sense to us and we agreed.
(20:56):
But everything else we'vewanted to do and explain to them
why we want to do it, theytotally understand it and have
been in full support of us.
They have never come in andsaid to us you need to cut
payroll, you need to do this orstop purchasing from this person
.
We think we can get you abetter deal on this or force you
(21:17):
to use relationships they havein insurance.
Um, they leave it up to us.
Operations are totally on us todo and obviously they expect
you to perform.
But but if you're an owner,you've already been performing.
So it's nothing new to havethat pressure of performance on
you and I say pressure, but it's.
It's the same as if you own thecompany yourself.
(21:39):
The only difference is I got achance to cash out a good chunk
of it.
Leave my 20% in and we'll growthe thing.
It's easier to grow somethingwith somebody else's money than
keep constantly putting your ownmoney out, for the risk is what
I always said, and there willbe a time maybe not tomorrow,
but there will be a time thatyou know they look to recoup
(22:01):
some of their investment and thecompany will probably be sold
again and at that point in timethe advantage to this way is I
get a second bite of the apple.
I got my first cash up front.
When they sell again I'll getanother chance to cash out again
.
Speaker 3 (22:20):
So let's talk about that a little bit.
I know you talked about it onprevious podcasts, but you sold
a large percentage of yourorganization to this group.
Explain how that works.
Speaker 4 (22:35):
All right, it's done in a stock deal.
So I sold them stock in thecorporation.
The company's name, your name,stays the same, nothing changes
your tax ID number, yourlettering on your truck DOT
number all that stays the samebecause it's not an asset
purchase.
Since they're purchasing stock,they give you X amount of
(22:57):
dollars based off of your EBITDAand multiple and that varies
depending on your EBITDA number,on the multiple.
So I cashed out, I kept 20%ownership in my stock and then,
as we go around purchasing theseother companies, I keep my
percentage of stock because Ihelp pitch in some money also
(23:19):
when we purchase these othercompanies.
So I have some skin in the gameand they know I'm making good,
sound decisions because it's mymoney also and we grow the
company and that next owner webuy also keeps the percentage in
.
So he has stock in the entirecompany, not just his company.
Now he now owns part of WindsorHenry's and Roadrunner.
(23:42):
If we were to do a deal, let'ssay tomorrow, with somebody,
they would now have a percentageof all three companies plus
their own company combined inthe parent company.
Speaker 3 (23:55):
All right.
So two questions come to mind.
But we're getting to the point.
We've got to take a break.
Can you hang around until afterthe break?
Of course I can.
Speaker 4 (24:05):
That's anything for you.
Speaker 3 (24:07):
We'll be right back listeners.
Speaker 2 (24:12):
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That's 910-747-9000.
Speaker 1 (25:21):
We look forward to serving you.
Welcome back listeners.
You're listening to the numberone podcast in the towing and
recovery industry, the AmericanTowing Recovery Institute
podcast, with Wes Bilburn, djHarrington and our special guest
, of course, fred.
But let me remind all of you wehave over 15,000 listeners and
(25:44):
growing.
We can't thank you enough forsharing.
Remember to like and review.
Wes reminds you.
Please like, by all means.
If you want to hear anotherindustry expert like Fred, just
dial 706-409-5603.
That comes right to the podcastcenter and, just like the last
(26:07):
time he was on, very informative, very up-to-date.
Take out your pencils andpapers and learn from the master
.
All right, wes, I'll turn itback over to you.
Thank you, dj.
Speaker 3 (26:21):
And, fred, I thank you for sharing.
A couple of questions pop intomy mind.
Well, first of all, in thefirst segment I talked about the
Lynchburg Virginia class beingalmost sold out, and part of
that is y'all's participation,the Roadrunner and Henry
Director's Service.
I should have said that when Italked about the Lynchburg
Virginia class, so we doappreciate that, fred.
(26:42):
Two questions come to mindabout what we've talked about.
One is as you expand, doessomeone have to be right in your
area for y'all to work withthem?
And then also, is the businessdeal that you made with 80-20 or
(27:04):
whatever the percentages were?
Does the deal have to bestructured like that or are
there other variables?
Speaker 4 (27:12):
All right To answer the first part of your question
do you have to be in ourfootprint?
The answer is no, I can tellyou.
Currently, two of the companieswe're hoping to get a deal done
with are not within ourfootprint and are a know a good
bit away from us, which is finebecause they're well-run
(27:34):
companies.
Speaker 3 (27:35):
um, both those owners and that's the key right.
Speaker 4 (27:38):
Well, that's what you're looking for yeah,
well-run companies, who've, youknow, do their bookkeeping the
proper way, pay all their taxes.
You know everything is recordedproperly.
And both those owners also wishto stay on and see the bigger
picture of growing the business.
(27:59):
And you know we're here to helpthem grow their business and
connect, you know, connect thedots, as we call it, across the
map in major areas.
So, yes, those owners will stayon and the percentage it can
vary.
You can do 20 percent, 15, 10,you know it varies back and
(28:21):
forth.
Speaker 3 (28:22):
But people have to stay with skin in the game.
Speaker 4 (28:25):
That's what I was getting to no, they do not have
to stay with skin in the game.
That's what I was getting to.
No, they do not have to staywith skin in the game.
But what will?
I would say we would like themto stay on for at least, if
they're not going to have anyskin in the game two years and
we'll give them a two-yearemployment contract.
That is very favorable, whichyou know, that's how I started
(28:46):
out with the two-year contract,which you know that's how I
started out with.
It was with a two-year contractand then it extended to
indefinitely, and same with Dave, because we see the bigger
picture.
But you know, you can do anasset purchase also, which we
looked at on a couple smallercompanies.
At possibly doing that, wewould just be able to, you know,
(29:08):
relabel the trucks and justfold them into the umbrella
already, and there are somereasons for those, because
they're not really running asolid EBITDA number but
strategically it makes sense andthey're close enough that we
can take over the management ofthe companies.
But there again, well-runcompany, if you have somebody
(29:34):
underneath of you, which youshould, as an owner, always be
trying to train somebody to bethe next owner and take your
place, even if you don't sell.
So you have more time forfamily and other activities that
you wish to do.
And that's how I approached it.
When I was growing henry's wasmaking sure I had the staff
underneath me and the rightpeople in place that I could
(29:55):
afford to go on a three-weekvacation or leave the state and
stuff, and a lot of owners won'tdo that because they're afraid
that person leaving or takingtrade secrets.
But you need to grow your ownpeople.
Well, that's good advice, nomatter where you are in business
(30:15):
.
Oh yeah, you as an owner, Imean you bust your.
It's to reward yourself,indulge in a couple little
things and take that family time, because it goes by fast, as we
all know.
Speaker 3 (30:28):
That it does that it does EBITDA.
Quick explanation of that, oh.
Speaker 4 (30:37):
EBITDA.
Speaker 3 (30:38):
EBITDA.
Speaker 4 (30:39):
Earnings before interest taxes, amortization,
depreciation, Depreciation,amortization.
Excuse me, Got it backwards.
Speaker 3 (30:51):
And those are numbers folks should be paying
attention to, right.
Speaker 4 (30:54):
Correct.
And your accountant I mean Iget it, I'm not the financial
wizard, but my CFO at the timeor your comptroller or your
accountant, should be able totake your financials, whether
you're doing quarterly, monthly,yearly and tell you what that
number is.
And that is the multiple thathas been used, or the formula
(31:19):
used since the 80s of evaluatingthe business.
And then there's a multiple puton it.
Sometimes it's as low as three,sometimes it can be high as
double digits, depending on that.
Speaker 3 (31:33):
EBITDA number and that's something that we talked
about in the previous podcastthat I'm going to challenge our
listeners to go back and listento is in great detail.
You explained the importance ofbeing accurate with those
numbers, and I say in greatdetail in a very down-to-earth
way.
Right now I want to shift gearsfor the few minutes we have
(31:55):
left.
What's going on around youroperating area and I hear
Virginia is looking at somethings.
I'm also interested in anyopinion you have on what's going
on on the federal junk fees andwhatnot on the federal level.
Speaker 4 (32:15):
Yeah, in Virginia my group, Northern Coalition of
Towers, lobbied Virginia Senateand House to regulate which they
already.
Let me back up.
They already regulate trespasstelling prices in the state of
Virginia but to get an increaseyou have to go back every year,
(32:39):
every so many years.
Convince the lobbyists I meannot the lobbyists, the senators
and the House representatives towant to increase your rates.
And no senator or lobby ormembers of the House wants the
vote usually to give towers anincrease.
They're afraid theirconstituents will be mad at them
and won't vote for them for thenext election.
(32:59):
So what we propose is that it'staken out of their hands and
put into the hands of the SEC,which regulates all businesses.
Let them set the rate.
They are impartial.
They are not tied by politicalbounds or parties or
constituents.
(33:21):
So what they decided to do wasdo a study.
The state funded it.
They hired a firm out of I wantto say it was Utah who was
doing the study on what a costand the rates that we should be.
They're going to propose ratesthat we should be getting for
those gas tows.
Those rates will be set andonce that is approved which we
(33:48):
feel will be approved this nextsession, then every year after
that we are lobbying that wetake the CPI index from the
transportation department andthat will be the increase that
is given every yearautomatically.
So if the transportation indexis 4%, our rates automatically
(34:08):
go up 4% across the state.
There's no going back andrenegotiating with the senators
and house representatives, itjust goes up.
Then possibly every five years,if the state wants to double
check everything, hire the firmagain.
Let them do another study.
This way it takes out thepolitics out of towing, which
(34:32):
they really shouldn't be in.
We're a business like any otherbusiness.
I don't feel that just becausesomebody doesn't like tow
companies that they shouldn'tvote for us to get a raise Right
.
So I believe it's a good thingfor the industry.
A lot of people don't likeregulations.
They're afraid it's going toopen the door up to something
(34:53):
else.
But we made it clear in ourbill this is all they are
regulating.
They're not regulating whetherwe have to get second signatures
or how we do the tow, uh, whatrecords we have to keep.
It's just strictly based on theprice of doing business, which
I think helps all the towers inthe state absolutely taking it
(35:17):
away from a politicalconsideration, absolutely what
do?
Speaker 3 (35:21):
you think about what's going on with the Fed and
junk fees?
Speaker 4 (35:26):
All right, the Fed and junk fees.
That's a good one.
They're considering our junkfees, basically our admin fees,
from what I read on it, sayingthat there are extra fees no
different than when you go to anairline and all of a sudden
they're charging you a check bagfee.
Well, if you want to take thataway, that's fine.
(35:49):
But in reality, here's what'sgoing to happen.
If Southwest Airlines, forexample, or any airline, is
charging you, let's say, $50 tocheck a bag, well, what's going
to happen is, whether you checka bag or not, your ticket price
is going to go up $50 to check abag.
Well, what's going to happen is, whether you check a bag or not
, your ticket price is going togo up $50 and they're going to
get rid of all check bag fees.
But whether you're checking thebag or not, you're paying that
(36:11):
$50 extra on your airline ticket.
If your ticket normally costsyou 200 bucks, it's now going to
cost you 250, plus taxes.
Same thing with towing.
They're talking about our adminfees, but by law we are
supposed to be sending out thesenotices.
So what's going to happen isthose admin fees are just going
to get lined up and added on tothe charge of the tow.
So you're really not solvingany problem.
(36:36):
The consumer is still going topay the same price for the tow,
it doesn't, or the airlineticket or whatever else they're
calling junk fees, just likewith hotels.
You know, I get it.
Hotels kind of hide the resortfees.
You know you see theadvertisement for the room and
then real small print resort feeof 25 a day oh, yeah, yeah, you
know what I?
mean so, just so.
(36:56):
So, just, I feel that and I'vealways felt this way, uh, even
when it was comes to towing andespecially trespass towing a lot
of counties and municipalitiesI've dealt with over the years
want to break all the chargesdown.
There's a hookup charge,there's a dolly fee charge,
there's an afternight charge,there's a weekend charge,
(37:17):
there's a holiday charge.
There are some states andmunicipalities that you can
charge extra.
Why not just make it one flatbill?
It makes life so much easier.
The consumer walks in, sees thebill Okay, it's $225, for
example.
Okay, well, you can get to that$225 by having $150 hookup, $50
(37:41):
for dollies and then another$50 for nighttime and weekend
fees.
And they look at those fees,separate it and they feel
they're getting ripped off.
More so, in my opinion, than ifI got a bill that said $250 is
the cost of the tell.
Speaker 3 (37:57):
Yeah, I can't.
Speaker 4 (37:59):
Because then they number one.
They're not really.
The question isn't how much thebill is when they look at it,
when it's completely broken downto all these separate fees.
The question is well, wait aminute, why did you charge
dollies on my car?
You should have had to dolly mycar.
It didn't need dollies.
But we know that is a safer wayto tow a car is with dollies
and dragging it from behind.
And it's just.
(38:23):
They're more going to argue withwhy their car was towed when
you had the photographicevidence to show them.
Simple and dumb.
When you have to explain thefees and the amount you're
charging, everybody's going tosay well, the state says I can
charge for dolly, so we dolliedyour car and charged you, didn't
matter whether it needed it ornot.
Most tow companies charge itand the drivers will dolly it.
So they're gonna argue over anadmin fee.
(38:45):
They're gonna argue it's just.
Why'd you tow my car?
You waited till after I wasparked there all day.
Why'd you wait till after nightto tow it?
So you charge me the extra fee?
Just incorporate everything inone fee is my opinion.
Yeah, that fee is going to behigher for some customers who
would have just paid a flat fee,but it's a lot easier when
(39:08):
you're dealing with a consumer.
You're still going to make yourmoney because all the other
fees are incorporated into thatone flat price.
Speaker 3 (39:15):
That's right.
Speaker 4 (39:17):
And I believe it's just less arguing.
Then the only argument thatcustomer has when they come to
pick up their car is why youtowed me.
That's it.
They're not arguing overdollies or go jacks or uh, you
know all these other littlemiscellaneous charges.
Whether it was towed aftereight o'clock at night, whether
it was towed before eighto'clock at night, how many miles
the car was towed back to thestorage lot.
(39:39):
I just believe in flat ratesfor specially trespassed towing.
It just makes life easier, Ifeel, on your employees at the
counter and on the consumer,because they don't feel like
they're being all these littleadditional charges added on to
take advantage of them.
Speaker 3 (39:58):
Yeah, it makes crystal clear sense.
As much as you can share thatsame mindset with your police,
authorized towing, don't you?
Speaker 4 (40:10):
Yes, you know, with our police authorized towing, it
is a contract.
The prices were set on thiscontract around but they took a
lot of input from the towers andgave us fair pricing in the
hookups.
And you know I am reallyfortunate being in Northern
(40:31):
Virginia and Fairfax County thatthe contract that they use and
the police officers that are onthat contract and the purchasing
department, they understand thebusiness.
They've been around thebusiness.
A lot of them have had parentswho were in trucking or some
form of business.
(40:51):
They understand that we're nota nonprofit, that we are here to
make money and they alsounderstand they don't want to
feel that the consumer is gouged.
So they sat down with us andthey look at the rates and they
asked us questions and we gavethem information.
They came up with a reallygreat fair rate.
That's a flat rate.
(41:11):
Whether you tow a car for thepolice department, it's on a
flat bed, a wheel lift hasdollies, no dollies.
Um, they left the recovery partup to us and as long as we are
able to justify what we chargein recovery, they're fine with
it.
And my last conversation abouta month ago was things are going
(41:35):
great on our contract, which isa 10 year contract and we're
only a year and a half into itwith the pricing structure and
we get automatic increases at arate of no higher than 3%, based
on the CPI.
Speaker 3 (41:50):
That's excellent.
I mean, you can't ask for muchmore than that, especially in
the towing world.
Speaker 4 (41:55):
No, you can't.
And again, they understand thatthere's going to be exceptions
to the rule.
You know you have that onetractor trailer that's rolled
over down an embankment orhanging off a bridge or loaded
down with diesel fuel or justfuel in general, or in their
cleanup.
The key and I feel a lot oftours miss this is in their
(42:15):
documentation.
Really take good pictures, butwhen you write up your invoice,
don't just give them an invoice,give them a complete, detailed
subscription, time on scene,what you had to do, what
equipment was used, when it wasused.
And I find that 90% of the timeI wind up getting my bill paid
(42:39):
in a reasonable amount and paidin full.
There's always that 10% outthere that refuse and think
everything's overpriced.
But that's what the courtsystems are for and fortunate
enough in Virginia if I sue atrucking company and I win, no
matter what the dollar amount is, I win.
They also have to add on thereand pay my attorney bills.
Speaker 3 (43:05):
That's substantial.
Speaker 4 (43:07):
Which is a law we got passed about two years ago.
It went into effect and theother thing I can tell you is I
was lucky enough to stumbleacross a great attorney who not
only sues the trucking companybut he also goes after the owner
of the cargo because it's theirresponsibility and they're
(43:28):
paying somebody to haul theircargo around.
That person carries enoughinsurance in case something does
happen, because a lot of timesyou hear that, oh well, the
cargo coverage is already usedup to pay for the cargo, so
there's no money left over.
Um, even if it's a liabilityclaim and you're just, you know,
(43:48):
for restoring the flow oftraffic you're charging for, you
can't actually charge for thetower storage, but go after the
the cargo.
Uh, there's no law that saysyou can't sue the person who
owns the cargo and the broker,because there's another person
involved.
Usually that broker is thecargo to these independent
truckers and other companies.
Speaker 3 (44:09):
That's the whole reason.
They should be involved in casesomething does happen,
including a wreck or whatever.
That's the whole reason for abroker.
I understand it, one of themain reasons.
Speaker 4 (44:20):
Let me word it like that and I had a case.
It took me about a year and ahalf but we won it and we ended
up going after the cargo holderand the broker, suing both of
them in federal court and we won.
They were responsible and whatended up happening is the broker
(44:43):
ended up Paying out of hispocket to us For the tow bill
because he did Not want to losehis relationship With the person
who owns the cargo because theyShip so much cargo and make so
much money Off of them a year.
So the broker actually belliedup the money To pay the tow bill
and recovery and storage.
So there's a lot of ways to goafter to pay the tow bill and
recovery and storage.
(45:03):
So there's a lot of ways to goafter nowadays and there's no
reason why, because they'reresponsible for their cargo,
they can say well, no, I gave itto the broker.
The broker made sure the personhad the property.
Well, guess what?
Your broker didn't do his job.
That still doesn't make youunliable.
You're liable for your cargo.
Speaker 3 (45:23):
Wow, that's an excellent point.
Now quick question Are theseissues something that if someone
was part of your umbrellaworking with y'all, that y'all
would provide help with?
Speaker 4 (45:37):
Of course, of course, that's what we all do.
We operate as one company.
Of course, of course that'swhat we all do.
We operate as one company.
They may be separate names andbe in separate locations,
whether they're in a separatecounty or a separate state or
even a separate region.
We all work together as onecompany when it comes to stuff
like this workers' comp, truckinsurance, employee benefits,
(46:00):
making sure that all theemployees have the same benefits
.
And if by chance, we purchase acompany, a partner with another
company and they are providingbetter benefits than we are,
then it's a win for everybodywho's already an employee of
ours, because all those benefits, then we match them to make
sure they're better.
(46:22):
So let's say, for example, ifyou're, if you, if you pay a
hundred percent of youremployees health insurance and
we were to purchase your, your,your company, well, we're not
going to tell your employees,well, now you're not not getting
a hundred percent of yourhealth insurance covered, right,
that wouldn't be fair to youremployees, that's not up to what
we do by purchasing yourcompany.
(46:44):
We look at that and say youknow what?
We need to up our standards forour employees.
I feel right now we have one ofthe highest standards for
employees when it comes tobenefits, whether it be their
401k, match their life insurance, dental insurance, health
insurance.
I feel we have a really, really, really good compensation
(47:05):
package on that, and you know.
But if somebody out there hasit better and we decide that
we're going to partner with them, then their employees aren't
going to.
Benefits aren't going to godown.
Our employees will go up Iftheir benefits aren't as good as
ours.
Their employees that work forthem benefits go up to match
ours.
Speaker 3 (47:26):
Well, many of the biggest service providers in the
country and over the world werefounded and grew on these same
principles, so it's nice to seethis business logic being
applied to the towing industry.
Speaker 4 (47:42):
To me it's an ethical thing.
How can I come in and partnerwith you and then take away from
your employees?
The whole object of thepartnership is to benefit the
company.
When I say company, that's tobenefit every employee that's
working there, not just theowner because he's getting a
chunk of change.
(48:02):
It's to benefit the individualemployee, whether they're the
dispatcher, the yard person, thecar release person.
It's to benefit them all.
And then that helps build theteamwork effort and just lift
everybody up, because as you'regrowing, you want to lift
(48:22):
everyone up that you'reaffecting.
Speaker 3 (48:24):
You want to lift them up with you.
Absolutely, absolutely.
Well said, fred, how doessomeone get in touch with you if
they want to get moreinformation?
Do you have an email?
Speaker 4 (48:37):
Yeah, sure, my email is fred underscore S as in Sam
at henrysreckercom.
All one word, or they can evenreach out on our phone at
1-324-1954.
Speaker 3 (48:57):
You bubbled a little bit.
Give me that number again.
Speaker 4 (49:01):
What did you say?
Wes you kind of bubbled on methat time.
Yeah, give me that number onemore time.
It was a little bit.
Give me that number again.
What'd you say?
Wes you kind of bubbled on methat time.
Speaker 3 (49:04):
Yeah, give me that number one more time.
It was a little bubbly the 301part of it.
So give me the whole thingagain please.
Speaker 4 (49:10):
Yes, 301-324-1945.
Excuse me, 540.
Speaker 3 (49:20):
Now you got me mixed up.
Yeah, I tend to do that, fredyeah, I noticed that over the
years there you go well.
Thank you for a great interviewand some great information to
the other consolidators, if anyof them out there listening.
I keep hearing you are we'dlove to have you all on.
We do have Jay and I out of StLouis going to be on with us in
(49:43):
one of the upcoming episodes.
There's a whole bunch of therest of you out there.
If you're interested, come onand tell us what you're doing.
Speaker 4 (49:52):
One more thing I'd like to add to that these other
groups that are consolidating,free to reach out.
We're not afraid of going.
You know, if you alreadyconsolidated, let's say, eight
companies or five companies,whatever it is, we're not afraid
to take a look at that either.
Excellent, there's plenty ofopportunity out there for
(50:14):
everyone right now and you knowI got to.
I have a feeling that you knowagain, it starts out by the
these groups doing consolidation, and then these groups
consolidate with one another andpartner up and it's just going
to keep growing from there, andwe are always open to something
like that also.
Speaker 3 (50:32):
That's good to hear and you know some people are
scared of this.
But if you step back and lookat the big picture, this is
nothing but good for theindustry and for the employees
working in the industry andwhole, and also for the small
business owner that'shardworking and is able to
capitalize on some of their hardwork to secure their family's
(50:54):
generational wealth.
I always think that's reallygood for a lot of hardworking
company owners.
Speaker 4 (51:02):
I would like to say that, too, a lot of the
mom-and-pop places and thesmaller companies are afraid of
this.
In reality, they should embraceit and try and get in at the
ground level when this isstarting, because their
percentage of shares will onlygo up in value as it grows.
Just like if you look at theperson who got involved in Apple
when Apple was just startingout right, his shares grew over
(51:26):
the years to where he's now abillionaire Over.
So it's no different.
Now I'm not saying you'll endup being a billionaire, but I
would gladly say you would be amillionaire over.
You know, it's just you get inearly and you help make it the
right company.
Yeah, but you're put your stampon it.
(51:47):
You know, grow, help us grow,and it's always nice to look
back and say, hey, I was a partof this, that's right.
Speaker 3 (51:56):
And the other thing is, by being a part of something
like this, it allows you tohave a life with your family.
Yeah, part of something likethis allows you to have a life
with your family yeah, it doesin the business you love but not
have to dedicate so much ofyour life to it.
Speaker 4 (52:09):
You know, I hear a lot of owners saying well, wait
a minute, I don't want to do itbecause me and my son's coming
up.
He's definitely going to berunning the company.
He's in his early 20s and ormid-20s and I want him to take
over the.
Hey, that's great, that canstill happen.
But not only him to take over.
Hey, that's great, that canstill happen.
But not only can he take overyour company.
With this partnership, he couldmove up in the ranks and maybe
(52:30):
take over and be in charge ofthree or four companies or a
whole region and make more anddo more and have more life than
you did building the business.
So don't feel like you'reshutting the opportunity out on
your son or daughter who's goingto take over the business,
because they're going to sellyou the business.
(52:51):
You have to sell it to them.
They're going to have to makepayments to you.
I'm sure and that's how youlook at it, that's being your
retirement is your son ordaughter take over the business
and they make monthly paymentsto you.
But there's really no guarantee, is there?
At least this way, I feel youhave a better guarantee because
you get a good chunk of themoney up front, you still have
the opportunity for your son,daughter to grow with the
(53:13):
business.
You can give them your shares,even and part of.
Speaker 3 (53:17):
And again, people should go back and listen to one
of the two others that I canthink of off the top of my head
where we talked about this withFred.
We talked about if you own yourreal estate, they're renting at
a fair market value, theemployment contract, how you
(53:37):
found that to be favorable.
So I do challenge people to goback and listen.
Fred, I hate to cut you off butwe're out of time.
Thanks for a great interviewtoday and again, thanks for your
long-term support.
You're number one member, firstperson to sign up for the
Institute when we started it,and I'll never forget you for
that, fred, thank you so much.
Speaker 4 (53:59):
It's my pleasure to be able to help our industry
become safer, looked at as moreprofessional industry over the
years.
Wes, I'm glad you took the timein your life to dedicate it to
do this for our industry.
I can't count on fingers howmany lives you saved over the
years by doing your instructionclasses and always preaching
(54:22):
safety in your first.
Job Description is to alwayscome home safe every night to
your family.
That's right.
Speaker 3 (54:28):
God bless our listeners.
Be safe Till the next time.
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