October 4, 2024 • 36 mins
This episode features a detailed discussion with Joe Shelton, an expert in portable sanitation with decades of experience. Joe recounts his early start in the industry, working for his family's business, and how that foundation led him to launch his own company and later a successful brokerage.
The episode focuses on the role of brokers in the restroom industry, dispelling myths and highlighting their potential to enhance business operations. Joe addresses common concerns about brokers, such as reliability and payment issues, and offers practical advice on how to leverage a broker's services to expand reach and improve efficiency. He stresses the importance of fair pricing and quality service, noting that while some operators may view brokers skeptically, they can be instrumental in reducing the burden of sales and marketing, especially for smaller businesses. Joe's candid discussion provides a comprehensive look at how brokers can be allies in the competitive sanitation market.
Takeaways:
- Joe Shelton shares his extensive experience in the portable sanitation industry, highlighting his journey from working in his family's business to starting his own.
- The podcast explores the role of brokers in the portable restroom industry, acting as intermediaries between customers and operators.
- Joe emphasizes the importance of building strong relationships with brokers to gain more business and leverage their sales capabilities.
- The episode discusses the challenges of pricing in the sanitation industry and the dangers of undercutting prices, stressing the need for sustainable pricing models.
- Joe advises restroom operators to collaborate with brokers and even competitors to optimize operations and grow their businesses.
- Communication and trust between brokers and operators are highlighted as crucial for successful partnerships and customer satisfaction.
Visit viprestrooms.com to learn more and contact Joe
Companies mentioned in this episode:
- Patriot Portable Restrooms
- VIP Restrooms
- United Site Services
- Oakley
- PSAI
- Andy Gump
- Amazon
- Dell
If you would like to appear on Get Flushed, have a question or an idea for the show, please email pete@getflushed.online or visit https://getflushed.online/booking to book a meeting with Pete.
If you enjoy Get Flushed and would like to support the show, please visit https://www.getflushed.online/support to send a tip to help cover our costs.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:17):
Hello and welcome to getflushed. I'm Pete. My guest today
hasan absolutely immense history in
portable sanitation with over 30
years of hands on experience, operational
insights and strategic expertise.
As a tenyear old, Joe Shelton started working
in his parents restroom company.
As anadult, Joe joined the team on a full
time basis and worked every role
there was when his father sold that
business, Joe launched his own restrooms
with his wife in Los Angeles in 2003.
In 2017, Joe and his wife sold the
Los Angeles business to United Site
Services, but they've continued to
build patriot portable restrooms
throughArizona, California, Kansas, Missouri,
Oklahoma and Washington. Alongside
that,Joe runs a successful restroom brokerage
under the banner vip restrooms, and
he's worked with toy company to develop
the Sandman portable restroom software.
Today's episode is all about restroom
brokers. If you're not familiar with
the brokerage model, the broker acts
as a middleman between customers
who needportable restrooms and the operators
whosupply them. It's fair to say that
I've read some negative things about
brokers and I've heard a few horror
stories where pros have been treated
poorly or not been paid. But I've
also seen lots of positives and there
are plenty of examples where brokers
and operators work very successfully
hand inhand. In this episode, Joe wears
hisbroker's hat. He talks at length
abouthow to work the relationship between
your restroom business and the restroom
brokers that operate in your area.
He's very open, the conversation
is bothfull and frank, and Joe shares a
lot of very sound advice.
(01:55):
I'm joined today by JoeShelton, who's called from Carlsbad
inCalifornia. Joe, how are you?
Great, how are you doing?
I'm good, thanks. Welcome toget flushed. It's great to have you
on the show.
Thank you for having me.
We've done some preliminarywork to get ready for the episode
and Ithink it'd be fair to say you run
afairly extensive and quite a complex
operation which isn't just about
portable toilets.
(02:17):
No. I started when I was aboutten, working for my dad in Los Angeles,
and we've slowly grown to the point
where he sold and a lot of his management
went off to different companies and
started their own companies. And
in2003, me and my wife, we also went
on our own and started our own toilet
journey as a restroom operator. We've
sold to United site services in 2017
and remained in San Diego instead
of LAand doing toilets. And at that time,
we also started participating in
asoftware and giving a software company
the inside scoop of standard operating
procedures of a toilet company since
I am a second generation and my kids
now are third. And also in that same
time period we started vip restrooms
because there's so many brokers that
just don't know the business. They
don't know the hardships of being
abrick and mortar company and they're
not always keeping the brick and
mortar company first and foremost
alongwith the customer's needs. There's
twosides of that. And so we started
abrokerage to help create a better
brokerage, one that provides more
ofa sales team for toilet companies.
(03:39):
Brokerage isn't a model thathappens in New Zealand, but my understanding
of it is you act as the middleman
betweenthe customer and the restroom operator.
Yes. And I was introduced inabout 2011 to brokerage as the brick
and mortar company doing the work.
And man, it was a breath of fresh
air. Because if you view brokerage
in apositive way, you actually get a
free advertising team. You get a
free sales salesman, if not a group
of salesmen. And it takes a cost
that you normally have to pay. And
if you do it right and you lower
theprice 20% or 30% so he can mark it
up and still be competitive, you
actually are basically paying all
the advertising and all the costs
forthe sales team after they got the
job. You don't have to pay for it
until you get the job, which there's
alot of expense in there that you
offset. And, and so it's super beneficial
if you can be fair to your brokers
andyou'll get a lot more work.
(04:48):
So that's almost like a quidpro quo that they're selling your
service. They employ the sales team,
they do all of the legwork. If you're
a small, maybe a one man band or
asmall family business, you might
nothave the depth to do all that yourself.
Oh yeah, that's probably oneof the favorite types of clients
wewant. Of course we want the big companies,
but service is key. As a broker,
wedon't get to touch the toilet. We
don't have an effect on the quality
ofservice. As a broker, I know that
werank vendors and companies to our
first primary, who we'd want to use.
And then based on price and quality
ofservice, if a toilet company is going
to give us a good price and they
rock at service, you know, we're
going to do extra advertising in
those areas. We're going to place
allof our work with them because we're
basically a customer. You know, theoretically
you should look at us as a customer
who's going to bring all the work.
And so I would recommend any toilet
company to call every broker. And
you want to do everything you can
to be their only customer because
nowyou've taken all that work from all
of your competitors.
(06:04):
Can you talk me through justhow the money side of that works?
Whodoes the invoicing and the billing?
Andwhere does the money flow go?
So the broker's going to billthe customer. And then if it were
me, I would want the broker's credit
card. VIP restrooms is the company
thatwe own and we will give out our credit
card because first and foremost,
the guydoing the work needs to get paid
andwho wants to chase money.
(06:30):
In effect, then the restroomoperator just processes a routine
invoice at the agreed rate to VIP
restrooms. And then VIP restrooms
followsup with the customer for the actual
invoice for the job.
Yeah. And the simplest way andthe best way for the sales team at
the brokerage to really be able to
adequately quote the customer in
atimely manner is to have a set rate.
You know, a blanket rate that covers
like your standard toilet, maybe
yoursink toilet, a PJ flush for a basic
one unit construction and a one or
two unit special. Now, when we get
quotes for bigger things, then of
course, our team knows to then send
out a quote request because you don't
want to be just bidding on a 30 unit
job at full book price. We know that
everybody bidding that's probably
goingto be fighting for it. And so we
want to be competitive. That doesn't
mean you guys aren't getting that
same bid request. And ultimately
you havetwo options. You could either give
us the same price you're giving the
customer requesting it, or you can
hedge your bet, give us a little
bitlower price so we can come in close
to you. And then now either way,
you're getting the job. It just comes
down to who built a better relationship.
You're basically playing survivor.
It'snot always about price. Sometimes
it'sabout who can work the phones the
best and who can be likable. You
know, some people like me. Some people
like a more dry person who's just
straight to the point. Most big jobs
are going to call three people. You
want to be two of them. And if you're
smart, you'll have three brokers
bidding on that and you'll be the
fourth bid. And now you have four
people to maybe try to sell that
foryou and you're still doing the work.
And that's how I've always viewed
it.It's a dartboard.
(08:24):
I'm glad you've mentionedprice, because we're seeing some
crazy pricing in the market, not
just here in New Zealand, but in
the UK and in the US as well. And
Ithink that's probably a reflection
of theeconomic environment, that things
area bit unsettled. Interest rates have
gone up and the whole market's a
bit shaky at the moment. But I'm
pleased to hear that you say it's
not just about price.
(08:45):
Price is tricky, no doubt. Icame from my wife and myself doing
toilets. We had one truck, one toilet.
And, yeah, you can lower your price,
you can take on a bunch of work,
butultimately the cost of that toilet
doesn't change. You still have to
come up with the money to buy more
toilets. Here's the bottom line.
Alot of drivers look at the owners
andthey go, I could do this. I saved
up2030 grand. I can get a loan for
atruck, I could buy 30 toilets. I
can start this on my own, I can do
this. Now I got to get the toilets
out.And they race to get the toilets
outand they lower the price, thinking,
that's the way when, hey, we're service
paced business. Who buys Oakley's
andthen who buys the sunglasses at the
small gas station for a 10th of the
price? The quality is completely
different. You're going to burn up
trucks the same as the guy who's
charging $200 versus 100. The only
difference is, are you going to have
the cash to buy a new truck four
years end when you need a new one
because you've been selling it for
too cheap.
(10:00):
I'm so pleased to hear you saythat, because I've come across so
many operators who just pull the
price lever and think that the lowest
price is the only way and the best
way to get units out on the ground.
Andit just makes me despair sometimes.
Youmight as well just throw dollar bills
out.
Yeah. It's a race to the bottom.
Yeah.
There are some companieswithin our markets that will do that
and, you know, there's enough work
for everybody. You just have to be
patient. You have to work hard, do
a good job.
(10:28):
Yeah.
And over time, word of mouth.If you work with brokers, your reputation
will grow, you'll get more toilets
outthere. People start to see you and
it's a long game. This isn't a get
rich quick business. It's a ten year
process to get a company to where
you're actually pulling money out.
If you're growing and you're doing
agood job, odds are you're not going
to have cash for a lot of years.
It'sall going to be in equity.
(10:53):
Because you have to keepinvesting to grow the business. You
can't build a business unless you
buy more restrooms and more trucks.
Yeah. And it's $650 if yourmargin is only 10% because you're
charging under $100 now. You need,
what is that, 60 toilets out to buy
another toilet a month.
Yeah. Which is a lot of work.
(11:13):
Yeah. And you're runningaround and your truck is going to
cost you 120 grand now.
Yeah.
Ultimately, you don't want toput toilets out too cheap.
We see it all the time,though, Joe. Honestly, it's crazy
with your vip hat on, how do you
manage the quality? Because the last
thing you want as the broker is for
a restroom operator to be doing those
hit and runs where they don't really
service or don't clean the unit.
Youwant the best possible service at
that price level. So what do you
dowith restroom clients to make sure
that they're at the right level,
quality wise?
(11:48):
Our goal is to find likeminded restroom operators, ones that
care about service. They understand
thatwe're a sales arm to them, not just
a broker, that we're taking a little
bit of that cost, and we're covering
more of the Internet than they are,
and they do a good job. It's just
like any customer. If they screw
us,do you think we're going to use them
again?
(12:12):
No, of course not.
Right. And so the better youcan treat a broker, the more of a
teammate you're going to have and
abigger sales team that you're going
to have. When I was doing toilets
in LAand I was working with one of the
larger brokers, we gained like, $180
to $200,000 a year in business, like,
instantly, because we showed up when
we said we were. We answer the phone
when they call, we answered when
they email or text us, and we gave
them a fair price so that they can
make money. They gave us all the
work.
(12:44):
That would have taken youyears to build that on your own as
a husband and wife team.
Oh, yeah.
Just the amount of effort Ican imagine would have been required
foryou to achieve that growth would
havebeen something else.
And at the time, we just camethrough the 2008 housing market dump.
Yeah, I lost half of my business.
I had alot of the movie industry business.
In2010, I lost all of that, and that
was about half of our income. And
when I picked up this broker. That
$200,000 a year in business was crucial
for me to not have to lay people
off.It was basically what saved my business
from tanking. And so it was quite
aboost. And since then, I've basically
wanted to partner with every and
any broker that would call us.
(13:30):
It's refreshing to hear thisbecause I serve the Facebook chat
groups and the restroom groups and
all of that. And there's always two
sides to the broker conversation.
It comes upquite often online and you get some
people who say, yeah, find a good
broker, work with them, you have
asolid relationship, and then you
get the naysayers, the ones who,
whatever you do as a broker, they're
just going to dismiss you and diss
you and claim that you're out there
to rip them off. And it's really
refreshing to have the other side
ofthe coin explained that, you know,
you're coming across as really open.
And the fact that you've said it's
ateam race, relationships, is it all
really?
(14:04):
Yeah, we're a partner. Theword broker is very broad. And yes,
there have been outfits out there
that wouldn't pay their toilet companies
that they work with. You know, they
might try to gouge the client and
they just sell it for $500 and place
it with anybody. And yeah, there's
apercentage of the population that
won't blink an eye at a dollar 500
toilet. But being a toilet operator,
Iunderstand that and I want to be
abenefit to the toilet companies that
use us. I want to partner with them.
If there's equipment that we can
get for them, you know, if they have
a job that they just can't do on
their own, well, give us a call and
we'll be that intermediator between
maybe your actual competitor and
get you the equipment for both of
you to do the work.
(14:55):
Because I'm guessing you'vegot a pretty big network of friends.
Yeah, I mean, my dad was thepresident of PSAI back in 1999. The
Gumps are our friends. I have good
relationships with, I think, every
competitor in my market in LA, in
the southern California. I know all
the owners and it's always been my
policy. If I know that I'm being
called by a competitor of mine, I
don't want to put my toilet next
totheir toilet without them knowing.
Iwant to give them the opportunity
to atleast save it. So we'll reach out
to them if we know and be like, hey,
this person's asking for quotes.
Youmight want to have a sales guy go
out there and see what the problem
isbecause, you know, I'm going to still
quote them. I'm not going to try
tobeat their price at no means, because
ultimately, I know the cost to do
a good job is expensive. You know,
you lower your price, what are you
going to have to do? You're going
toeither have to buy used equipment,
you'regoing to have to buy used trucks,
andyou're going to have to hire cheaper
employees, and that's going to lower
what your quality of service, which
then now you're on a spiral down.
Andso ultimately you have to have a
balance and another big price thing.
And I made this decision in 2017
when I sold to United and we still
had our operation in San Diego. I
did some numbers. I ran numbers.
My dad,in 1999, was selling toilets for
$89 a toilet for a special event.
Andwhen I entered into the sales team,
Ihad a huge argument with one of my
coworkers. I was selling them for
95 and he was selling them for 89.
I'm like, why can't we get 95? I'm
selling them all day. And there was
this whole thing. Well, when I sold
in 20 1717 years later, our average
price was $100. Now, when I went
back and I looked at the price of
milk, fuel, wood, all of these things
had tripled in price since 1999 to
2017. But our toilet price was almost
the same. And I said, there's no
way we can stay in business. Our
margins are just getting crushed.
Wehave to be at 185, 200. We should
beat 300 based on that model. And now
with inflation, we technically should
be closer to the 300, 5400 for a
standard toilet. That's what we should
be at. Now. How do we get there and
get what we should based on how the
cost of everything has gone up.
(17:37):
With low prices, nobody wins.The customer doesn't win. They might
think they are because they're getting
a low price, but their service will
invariably fail. You can't keep providing
a great service at a rock bottom
price. The economics just don't add
up.
Let's be honest. There'scompanies that are going to pin you
against your competitor and they're
going to ask for the best service.
They're going to expect the best
service, but yet they're going to
say, hey, Bob will give it to me
for $50. Will you do 45? Especially
whenyou already have the job and you
just hired a guy and you got a truck
and it's half of your route and you're
going to lose 75 toilets. Now you
have a tough decision. And ultimately,
youknow, back in probably 2015, I had
a client who. They had four or five
decent sized jobs. They probably
had atotal of 30 units out. And they kept
grinding me and grinding me down
onprice. And it got to the point where
they would call me and just yell
atme and threaten that they were going
to leave me if I didn't do x, Y or
Z. And in this case, they wanted,
like,a case of paper a month extra. And
I said, wait a second. I go, so if
my margin is 10% on your toilets
and acost of toilet paper, a two rolls
islike a dollar. If I'm only making
$10,you're asking for a 10% margin cut?
Yeah, I can't. I mean, as much as
I want to, you know, and what I did
is, I said, listen, I called United
Site Services. I got a rep form that
I knew, and I said, here. I gave
thecustomer the salesman's number. I
said, you know what? You need to
call him. He'll give you the price,
but you're not going to get the same
service you were getting. And so
about a year and a half later, they
begged for us to do the work again.
(19:25):
I think a lot of listenerswill really enjoy hearing that because
the pressure is relentless. I don't
know whether the industry has allowed
that to happen, because historically,
it wasa lot of smaller operators, and they
would feel they were competing against
their neighbours or the operator
in thenext town. For me, the mindset needs
to change, and it needs to change
pretty radically.
(19:46):
Yeah. And, you know, you justhave to have confidence in what you're
doing and know that. You know what?
It's just like we tell anyone who
doesn't have high self esteem of
themselves, they start to do things
they normally wouldn't. When they
don't have a good high esteem, they're
taken advantage of, and it comes
downto us not being taken advantage of.
Your time is worth more than $15
aweek. Like, if a customer's talking
tome and they're complaining about
price, I say, well, well, how much
do I have to pay you to come clean
mytoilet and my house? Are you gonna
drive all the way over here for $15?
No way.
(20:26):
The industry has trained themto expect a really low price.
As you were talking aboutprice and trying to get work done,
you know, something that also came
to mind is you have to be willing
topartner with your competitors. The
trash industry in America, they sector
off spaces and they bid out that
tothe cities, which I don't agree with
at all. I think there's a lot of
unfairness with that. But I do believe,
and I've always done this, is that
if there's another small operator,
andyou're a small operator, communicate
withthat operator where you're thin.
Andif there's an area 30 miles from
your yard or 40 miles that you have
15 toilets, you know, it might be
too far for you to actually operate,
buthe might have ten or 15 toilets there.
And maybe you broker with him and
say, hey, will you do my services
inthis area? And I'll do your services
inthis area. You're still his competitor,
andyeah, you're still bidding for work.
And eventually he might get bigger
than you in an area, and you might
get bigger than him, but in the end,
there's usually enough work for everybody,
and at least you're operating profitably,
because that's really what our business
is about, is route density. And if
you can help a competitor and yourself
at the same time, and both people
canmake money, then that's another avenue
that we've always encouraged at our
toilet companies. And that's kind
ofwhy we did the brokerage as well,
isbecause, you know, it's hard to be
a small family owned business. And
I knew that I could help others through
providing sales and putting other
people together that might have equipment
where others didn't. I noticed that
because United site services would
need equipment, but a lot of the
local companies wouldn't rent back
and forth to different companies,
and sowe would be the middleman. And, you
know, when I sold united, I think
mytop three customers were my competitors.
There's money to be made when you
help others.
(22:29):
I'm convinced of it.Absolutely. I've heard so many restroom
operators say that, and it's a shame
that sometimes the default position
fora lot of people is to be hostile,
to seeevery other restroom operator as
athreat. And yeah, sure, they are
atone level, but it does pay to have
friends. Joe, if I'm a restroom operator
and I'm listening in, I think you
know what I'd like to jump on board
with Joe. What's the best way for
them? A, to get in touch, and then
b, what's the process of onboarding
them?
(22:57):
Our website has a request.Viprestrums.com has a request on
there to become a vendor. It's pretty
easy. And ultimately, we don't always
have a lot of work in your market.
Youknow, there's certain parts of the
country that there's just not a lot
of work, you know, the population's
low orit's farm area, but we will get calls
from time to time. And we can't promise
that your market's going to have
athousand toilets. Like we were talking
about Los Angeles, one of the biggest
markets. But you go into middle America
where there's a population of 10,000
versus millions, it's going to differ.
And that's where you want to contact
every broker. I'm not here just to
try to build relationships with the
toilet companies and want them to
use me. No, listen, the heart of
why we did brokering, the heart of
why we developed a software for our
industry and helped participate in
that is to help others get through
that. Anybody who really knows me
will know that. That's really where
my heart is. Sure I want to make
money, sure I want to get something
outof it, but it's our goal to help
others in this process. And so definitely
call every broker that you find.
Whenyou search portable toilets and you
see that there's all these companies
inyour area, you should call every
oneof them and see if you can help them.
And then be fair, be fair to them
and make sure that you fully understand
what you're getting out of it. And
not just look at them as the bad
guy, but actually understand that
they're a sales team and they have
acost. And really all you have to
do is sign up, call them, and fill
out the form so we know what areas
you service, what areas you don't
service. And so that way we can database
it and start sending you leads. And
ultimately, we are dependent upon
price because we have the ability
tosend out a request to all of your
competitors, and we probably already
are. And we already probably know
everybody's price. And so now we
know what we know the market price.
Itcould be $200 in Rhode island, it
could be $300 in Rhode island, or
it could be a $100. Well, if you're
giving us a price that we can't put
a margin on it, then are we going
touse you?
(25:19):
You're out of the game.
Yeah, you're out of the game.So you got to make sure you understand
your market price. And you got to
know that for us to make money as
a broker, we need to be able to mark
it up 40%. Otherwise, there's no
point of us being in business because
the sales team, advertising, all
ofthat costs money. Odds are if you
search in your area and the top seven
people are brokers, then you might
aswell stop marketing and paying for
advertising. And you should start
calling all those brokers because
guesswhat? You're not going to beat their
advertising. You just don't have
thebuying power.
(25:59):
And that's really crucialbecause the cost of a good employee
inthat sales space would be more than
that independent operator is going
togenerate themselves.
I mean, a good salesman is 100grand a year plus. Yeah, it's ten
grand a month. Advertising could
be2030 grand a month, you know, depending
on the, the size of the market that
you're working in. And so ultimately,
ifyou really consider the market price
of where everybody's at and give
them space to make money, then you're
going to find a teammate, a salesman.
Youbasically hired a salesman, but you
don't pay them until they actually
getyou work, which is the best kind
ofsalesman you can possibly want.
(26:43):
It's a topic that's come up inconversation quite a lot. You know,
at Christmas last year, I did the
daily episodes where people sent
mequestions, and one of them came up
was, should I use a broker? And I
didn't go near it because I didn't
know enough about it and I didn't
havea contact at the time who could tell
me the ins and outs and explain how
the brokerage system worked from
their perspective. So it's been really
good to hear this.
(27:04):
Get a credit cardinal. Iwouldnt bill a broker unless youve
used them for more than a few years
and you trust and youve met them.
Ofcourse I want to say you can trust
me, but you know what? Get my credit
card. Dont bill me. Get the money
upfront. Because from a business standpoint,
from an operator standpoint, cash
isking. You can do much more with the
cash than an accounts receivable
list.Dont chase the money. Its not worth
it. And ive been a vendor to many
brokers or even other companies.
And morethan once, friends have gotten to
a point where they're robbing Peter
to pay Paul and they got way behind
with me. And that was tough. And
Icould see how it can easily happen
when you're running a business and
you're like, oh, shoot, I'm going
tojust put off paying this guy to pay
this guy. That's business. And so
I would always say, get a credit
cardfrom the brokers. Protect yourself.
Yeah,but also make sure you make their
work a priority because ultimately
it'syour toilet out there and it's your
name. And if a broker's not happy
with you, that should say a lot about
you.
(28:16):
So in the brokeringrelationship, when a toilet's on
site and there's a problem, say there's
a tip over or they've run out of
paper, does the customer on the ground
phone the brokerage or the restroom
operator?
Well, in a perfect world,they're phoning the brokerage so
that the brokerage can deal with
theguy on the ground. Now, it's important
that you communicate to the broker
anything that the client calls them
with. When I had brokers, they loved
our company because we would never
take their job. One of their clients
called us and said, hey, we need
another toilet. We're going to say,
okay, well, let me get that over
toyour sales rep and send that over
tothem. Or take the order and send
itto them and say, hey, this one's
yours. Because ultimately they put
in the time and the money to get
that work for you.
(29:09):
So there's a bit of educationboth ways there, Joe. So you need
toeducate the restroom operator to
understand that they need to refer
work back to the broker.
I mean, they don't need to,but listen, treat others the way
you want to be treated, and then
at the.
Same time, you've got to makesure the customer on the ground,
thehirer, knows that they need to ring
the brokerage rather than ring the
driver or the restroom operator direct.
(29:33):
Yeah, or you just communicatethe changes. Like if there's extra
services, if there's a pickup that
they called to pick up, well, let
the broker know so that they don't
keep billing the customer and then
create a, have a, do a chargeback.
Becauseif we don't know you picked it up,
we're just going to keep billing
thecustomer. And then three months later
they're pissed off because we bill
them for two extra months. Communication
iskey. We definitely want to know your
operations manager's number. We want
to have an after hours number. I
mean, these are things that if you
want it to work, like seamless and
be an amazing relationship, if you
can answer the phone 24/7 you'll
neverbelieve the kind of work you can
get. Some amazing things have happened
at 11:00 at night where a lot of
money can be made because of a fire,
a water outage at a Walmart, whatever.
And you know what? You're the only
one who answered.
(30:31):
Absolutely. I've got onequestion which somebody asked me
last week, which is about signatures
oncontracts. Now, I've never got really
hung up about this because I always
figured that there was an email trail
and that we'd had a good record of
the agreement process before we put
a toilet on the ground. But being
abroker based in California, I'm guessing
that you very rarely get on site
with the customer. So are signatures
oncontracts an issue for you? And if
not, why not? And if so, how do you
go around getting the customer signature
on paper?
(31:05):
Well, toy company is thesoftware. They're the ones who sell
the software. And one of our first
things we implemented is that the
customer at point of sale can sign
through the system. The quote gets
sent and the customer is prompted
tosign the terms and agreement. As
astandard operating procedure, you
could easily make it, hey, we don't
complete an order until you've signed
online and then that's data based
inthe system. We also, on all our invoices
state that, hey, this payment of
the invoice which the terms and agreements
are always on, basically is a signature
too. So you kind of want to have
that verbiage in there to make it
known that hey, on almost every document
you get from us, it's got the terms
and agreement.
(31:56):
I got burnt most of all whereproject managers or site managers
onconstruction or civil projects had
called me, asked for a restroom and
we delivered one and then when we
sent the invoice it'd come back,
oh,there's no purchase order number.
And Igot burnt more times with that, arguing
with companies about purchase order
numbers or they'd given me a purchase
order number which wasn't correct.
And Ihad more problem with that than I
ever did with signatures.
(32:21):
Another big thing that wedecided to do is credit cards. I
try to collect a credit card for
most things. Now if Amazon called,
ifDell called like a major traded company
called, we might bill them, but we're
probably going to still ask for a
credit card and if they push back
then we'll deal with that. But for
the most part, we don't want a bill
if we don't have to. And you've got
to show some, you know, hey listen,
ifyou don't have a credit cardinal,
youreprobably not a company we want to
do business with realistically and
we understand the larger companies,
itstoo much work for them to use a credit
card. But unless theyre going to
order 20 or 30 toilets or we havent
heard of you, then were probably
goingto want a credit card.
(33:14):
Allowing the restroomoperators to have your credit card
also avoids them getting stuck in
any 90 day payment terms or anything
that causes them cash flow pain like
that.
Yeah, yeah, exactly. From abroker standpoint and from a vendor
standpoint or an operator. Getting
thecash upfront allows you to easily
beable to grow, and I would always
recommend that. And you know what?
Acollection agent cost 70 grand a
year. So I'd rather pay two or 3%
on the sales and get the money up
front so I can keep growing my business
than to wait 90 to 120 days or not
get paid at all.
(33:54):
Is there anything else youwant to put in this episode? I'm
hoping we can do some more.
Definitely follow up if peoplehave questions or whatever. I'm all
for hopping back on. And, you know,
education is key. Not everybody's
got togrow up and start in the wash bay
and then.
Be a driver next week on the fries.
Not everybody got the wholething. Sometimes you just go after
it. You know, I'm all about educating,
helping others, and I think that
there's a lot to learn from everybody
andmy way is not the best way all the
time. You know, I'm still learning
at 30something years of doing this.
(34:29):
I wasn't expecting to talkabout brokerage this morning, but
Ithink that'll be an absolutely invaluable
episode. I think people will listen
tothat and think, hey, you've answered
alot of questions, Joe.
Well, I appreciate your timeand hopefully we've helped some people.
Yeah, fingers crossed.
Take care, bud.
You too.
Cheers.
Bye.
(34:50):
I'd really like to thank Joefor helping me to make this episode.
Itwas entirely unscripted, and until
westarted to chat, I don't think either
of us really knew where we were going
to go. I've made over 130 podcast
episodes for get flushed and other
shows, and I knew that this was going
to be one of my favourites as soon
as I started to edit the recording.
As Joesaid, brokering doesn't work for
everyone, and I understand why some
operators might be reluctant or openly
adverse to using a broker. You might
think that they're riding you by
charging your units out at full rate
while only paying you 60 or 70% of
the charge. And if you've already
gotplenty of work and a successful sales
funnel, you might not need to take
that hit. But the other side of the
coin is that a broker can take away
all the pressure to make sales, deal
with customers, and chase payment.
Thatin turn could and should free up
alot of time, effort and resources
thatotherwise eat into your business.
Especially if you're a smaller operation
where you're hands on and don't have
a dedicated sales team to chase leads.
In a situation like that, you have
to ask whether it's better to get
70% hassle free or miss out completely
because you're too busy to make the
calls or you can't compete with the
brokers on marketing, sales, and
customer relations. The most striking
thing about today's episode for me
was Joe's openness and willingness
to helpothers. Honestly, we could have kept
talking for hours, and I hope he'll
be back on more episodes in the future.
In the meantime, if you want to know
more about Joe as a broker, please
visit viprestrooms.com or follow
thelink in the notes for today's show.
That's all for today. Thanks again
toJoe, and thank you. I've been Pete
and you've been listening to get
flushed.
Hello and welcome to getflushed. I'm Pete. My guest today
hasan absolutely immense history in
portable sanitation with over 30
years of hands on experience, operational
insights and strategic expertise.
As a tenyear old, Joe Shelton started working
in his parents restroom company.
As anadult, Joe joined the team on a full
time basis and worked every role
there was when his father sold that
business, Joe launched his own restrooms
with his wife in Los Angeles in 2003.
In 2017, Joe and his wife sold the
Los Angeles business to United Site
Services, but they've continued to
build patriot portable restrooms
throughArizona, California, Kansas, Missouri,
Oklahoma and Washington. Alongside
that,Joe runs a successful restroom brokerage
under the banner vip restrooms, and
he's worked with toy company to develop
the Sandman portable restroom software.
Today's episode is all about restroom
brokers. If you're not familiar with
the brokerage model, the broker acts
as a middleman between customers
who needportable restrooms and the operators
whosupply them. It's fair to say that
I've read some negative things about
brokers and I've heard a few horror
stories where pros have been treated
poorly or not been paid. But I've
also seen lots of positives and there
are plenty of examples where brokers
and operators work very successfully
hand inhand. In this episode, Joe wears
hisbroker's hat. He talks at length
abouthow to work the relationship between
your restroom business and the restroom
brokers that operate in your area.
He's very open, the conversation
is bothfull and frank, and Joe shares a
lot of very sound advice.
(01:55):
I'm joined today by JoeShelton, who's called from Carlsbad
inCalifornia. Joe, how are you?
Great, how are you doing?
I'm good, thanks. Welcome toget flushed. It's great to have you
on the show.
Thank you for having me.
We've done some preliminarywork to get ready for the episode
and Ithink it'd be fair to say you run
afairly extensive and quite a complex
operation which isn't just about
portable toilets.
(02:17):
No. I started when I was aboutten, working for my dad in Los Angeles,
and we've slowly grown to the point
where he sold and a lot of his management
went off to different companies and
started their own companies. And
in2003, me and my wife, we also went
on our own and started our own toilet
journey as a restroom operator. We've
sold to United site services in 2017
and remained in San Diego instead
of LAand doing toilets. And at that time,
we also started participating in
asoftware and giving a software company
the inside scoop of standard operating
procedures of a toilet company since
I am a second generation and my kids
now are third. And also in that same
time period we started vip restrooms
because there's so many brokers that
just don't know the business. They
don't know the hardships of being
abrick and mortar company and they're
not always keeping the brick and
mortar company first and foremost
alongwith the customer's needs. There's
twosides of that. And so we started
abrokerage to help create a better
brokerage, one that provides more
ofa sales team for toilet companies.
(03:39):
Brokerage isn't a model thathappens in New Zealand, but my understanding
of it is you act as the middleman
betweenthe customer and the restroom operator.
Yes. And I was introduced inabout 2011 to brokerage as the brick
and mortar company doing the work.
And man, it was a breath of fresh
air. Because if you view brokerage
in apositive way, you actually get a
free advertising team. You get a
free sales salesman, if not a group
of salesmen. And it takes a cost
that you normally have to pay. And
if you do it right and you lower
theprice 20% or 30% so he can mark it
up and still be competitive, you
actually are basically paying all
the advertising and all the costs
forthe sales team after they got the
job. You don't have to pay for it
until you get the job, which there's
alot of expense in there that you
offset. And, and so it's super beneficial
if you can be fair to your brokers
andyou'll get a lot more work.
(04:48):
So that's almost like a quidpro quo that they're selling your
service. They employ the sales team,
they do all of the legwork. If you're
a small, maybe a one man band or
asmall family business, you might
nothave the depth to do all that yourself.
Oh yeah, that's probably oneof the favorite types of clients
wewant. Of course we want the big companies,
but service is key. As a broker,
wedon't get to touch the toilet. We
don't have an effect on the quality
ofservice. As a broker, I know that
werank vendors and companies to our
first primary, who we'd want to use.
And then based on price and quality
ofservice, if a toilet company is going
to give us a good price and they
rock at service, you know, we're
going to do extra advertising in
those areas. We're going to place
allof our work with them because we're
basically a customer. You know, theoretically
you should look at us as a customer
who's going to bring all the work.
And so I would recommend any toilet
company to call every broker. And
you want to do everything you can
to be their only customer because
nowyou've taken all that work from all
of your competitors.
(06:04):
Can you talk me through justhow the money side of that works?
Whodoes the invoicing and the billing?
Andwhere does the money flow go?
So the broker's going to billthe customer. And then if it were
me, I would want the broker's credit
card. VIP restrooms is the company
thatwe own and we will give out our credit
card because first and foremost,
the guydoing the work needs to get paid
andwho wants to chase money.
(06:30):
In effect, then the restroomoperator just processes a routine
invoice at the agreed rate to VIP
restrooms. And then VIP restrooms
followsup with the customer for the actual
invoice for the job.
Yeah. And the simplest way andthe best way for the sales team at
the brokerage to really be able to
adequately quote the customer in
atimely manner is to have a set rate.
You know, a blanket rate that covers
like your standard toilet, maybe
yoursink toilet, a PJ flush for a basic
one unit construction and a one or
two unit special. Now, when we get
quotes for bigger things, then of
course, our team knows to then send
out a quote request because you don't
want to be just bidding on a 30 unit
job at full book price. We know that
everybody bidding that's probably
goingto be fighting for it. And so we
want to be competitive. That doesn't
mean you guys aren't getting that
same bid request. And ultimately
you havetwo options. You could either give
us the same price you're giving the
customer requesting it, or you can
hedge your bet, give us a little
bitlower price so we can come in close
to you. And then now either way,
you're getting the job. It just comes
down to who built a better relationship.
You're basically playing survivor.
It'snot always about price. Sometimes
it'sabout who can work the phones the
best and who can be likable. You
know, some people like me. Some people
like a more dry person who's just
straight to the point. Most big jobs
are going to call three people. You
want to be two of them. And if you're
smart, you'll have three brokers
bidding on that and you'll be the
fourth bid. And now you have four
people to maybe try to sell that
foryou and you're still doing the work.
And that's how I've always viewed
it.It's a dartboard.
(08:24):
I'm glad you've mentionedprice, because we're seeing some
crazy pricing in the market, not
just here in New Zealand, but in
the UK and in the US as well. And
Ithink that's probably a reflection
of theeconomic environment, that things
area bit unsettled. Interest rates have
gone up and the whole market's a
bit shaky at the moment. But I'm
pleased to hear that you say it's
not just about price.
(08:45):
Price is tricky, no doubt. Icame from my wife and myself doing
toilets. We had one truck, one toilet.
And, yeah, you can lower your price,
you can take on a bunch of work,
butultimately the cost of that toilet
doesn't change. You still have to
come up with the money to buy more
toilets. Here's the bottom line.
Alot of drivers look at the owners
andthey go, I could do this. I saved
up2030 grand. I can get a loan for
atruck, I could buy 30 toilets. I
can start this on my own, I can do
this. Now I got to get the toilets
out.And they race to get the toilets
outand they lower the price, thinking,
that's the way when, hey, we're service
paced business. Who buys Oakley's
andthen who buys the sunglasses at the
small gas station for a 10th of the
price? The quality is completely
different. You're going to burn up
trucks the same as the guy who's
charging $200 versus 100. The only
difference is, are you going to have
the cash to buy a new truck four
years end when you need a new one
because you've been selling it for
too cheap.
(10:00):
I'm so pleased to hear you saythat, because I've come across so
many operators who just pull the
price lever and think that the lowest
price is the only way and the best
way to get units out on the ground.
Andit just makes me despair sometimes.
Youmight as well just throw dollar bills
out.
Yeah. It's a race to the bottom.
Yeah.
There are some companieswithin our markets that will do that
and, you know, there's enough work
for everybody. You just have to be
patient. You have to work hard, do
a good job.
(10:28):
Yeah.
And over time, word of mouth.If you work with brokers, your reputation
will grow, you'll get more toilets
outthere. People start to see you and
it's a long game. This isn't a get
rich quick business. It's a ten year
process to get a company to where
you're actually pulling money out.
If you're growing and you're doing
agood job, odds are you're not going
to have cash for a lot of years.
It'sall going to be in equity.
(10:53):
Because you have to keepinvesting to grow the business. You
can't build a business unless you
buy more restrooms and more trucks.
Yeah. And it's $650 if yourmargin is only 10% because you're
charging under $100 now. You need,
what is that, 60 toilets out to buy
another toilet a month.
Yeah. Which is a lot of work.
(11:13):
Yeah. And you're runningaround and your truck is going to
cost you 120 grand now.
Yeah.
Ultimately, you don't want toput toilets out too cheap.
We see it all the time,though, Joe. Honestly, it's crazy
with your vip hat on, how do you
manage the quality? Because the last
thing you want as the broker is for
a restroom operator to be doing those
hit and runs where they don't really
service or don't clean the unit.
Youwant the best possible service at
that price level. So what do you
dowith restroom clients to make sure
that they're at the right level,
quality wise?
(11:48):
Our goal is to find likeminded restroom operators, ones that
care about service. They understand
thatwe're a sales arm to them, not just
a broker, that we're taking a little
bit of that cost, and we're covering
more of the Internet than they are,
and they do a good job. It's just
like any customer. If they screw
us,do you think we're going to use them
again?
(12:12):
No, of course not.
Right. And so the better youcan treat a broker, the more of a
teammate you're going to have and
abigger sales team that you're going
to have. When I was doing toilets
in LAand I was working with one of the
larger brokers, we gained like, $180
to $200,000 a year in business, like,
instantly, because we showed up when
we said we were. We answer the phone
when they call, we answered when
they email or text us, and we gave
them a fair price so that they can
make money. They gave us all the
work.
(12:44):
That would have taken youyears to build that on your own as
a husband and wife team.
Oh, yeah.
Just the amount of effort Ican imagine would have been required
foryou to achieve that growth would
havebeen something else.
And at the time, we just camethrough the 2008 housing market dump.
Yeah, I lost half of my business.
I had alot of the movie industry business.
In2010, I lost all of that, and that
was about half of our income. And
when I picked up this broker. That
$200,000 a year in business was crucial
for me to not have to lay people
off.It was basically what saved my business
from tanking. And so it was quite
aboost. And since then, I've basically
wanted to partner with every and
any broker that would call us.
(13:30):
It's refreshing to hear thisbecause I serve the Facebook chat
groups and the restroom groups and
all of that. And there's always two
sides to the broker conversation.
It comes upquite often online and you get some
people who say, yeah, find a good
broker, work with them, you have
asolid relationship, and then you
get the naysayers, the ones who,
whatever you do as a broker, they're
just going to dismiss you and diss
you and claim that you're out there
to rip them off. And it's really
refreshing to have the other side
ofthe coin explained that, you know,
you're coming across as really open.
And the fact that you've said it's
ateam race, relationships, is it all
really?
(14:04):
Yeah, we're a partner. Theword broker is very broad. And yes,
there have been outfits out there
that wouldn't pay their toilet companies
that they work with. You know, they
might try to gouge the client and
they just sell it for $500 and place
it with anybody. And yeah, there's
apercentage of the population that
won't blink an eye at a dollar 500
toilet. But being a toilet operator,
Iunderstand that and I want to be
abenefit to the toilet companies that
use us. I want to partner with them.
If there's equipment that we can
get for them, you know, if they have
a job that they just can't do on
their own, well, give us a call and
we'll be that intermediator between
maybe your actual competitor and
get you the equipment for both of
you to do the work.
(14:55):
Because I'm guessing you'vegot a pretty big network of friends.
Yeah, I mean, my dad was thepresident of PSAI back in 1999. The
Gumps are our friends. I have good
relationships with, I think, every
competitor in my market in LA, in
the southern California. I know all
the owners and it's always been my
policy. If I know that I'm being
called by a competitor of mine, I
don't want to put my toilet next
totheir toilet without them knowing.
Iwant to give them the opportunity
to atleast save it. So we'll reach out
to them if we know and be like, hey,
this person's asking for quotes.
Youmight want to have a sales guy go
out there and see what the problem
isbecause, you know, I'm going to still
quote them. I'm not going to try
tobeat their price at no means, because
ultimately, I know the cost to do
a good job is expensive. You know,
you lower your price, what are you
going to have to do? You're going
toeither have to buy used equipment,
you'regoing to have to buy used trucks,
andyou're going to have to hire cheaper
employees, and that's going to lower
what your quality of service, which
then now you're on a spiral down.
Andso ultimately you have to have a
balance and another big price thing.
And I made this decision in 2017
when I sold to United and we still
had our operation in San Diego. I
did some numbers. I ran numbers.
My dad,in 1999, was selling toilets for
$89 a toilet for a special event.
Andwhen I entered into the sales team,
Ihad a huge argument with one of my
coworkers. I was selling them for
95 and he was selling them for 89.
I'm like, why can't we get 95? I'm
selling them all day. And there was
this whole thing. Well, when I sold
in 20 1717 years later, our average
price was $100. Now, when I went
back and I looked at the price of
milk, fuel, wood, all of these things
had tripled in price since 1999 to
2017. But our toilet price was almost
the same. And I said, there's no
way we can stay in business. Our
margins are just getting crushed.
Wehave to be at 185, 200. We should
beat 300 based on that model. And now
with inflation, we technically should
be closer to the 300, 5400 for a
standard toilet. That's what we should
be at. Now. How do we get there and
get what we should based on how the
cost of everything has gone up.
(17:37):
With low prices, nobody wins.The customer doesn't win. They might
think they are because they're getting
a low price, but their service will
invariably fail. You can't keep providing
a great service at a rock bottom
price. The economics just don't add
up.
Let's be honest. There'scompanies that are going to pin you
against your competitor and they're
going to ask for the best service.
They're going to expect the best
service, but yet they're going to
say, hey, Bob will give it to me
for $50. Will you do 45? Especially
whenyou already have the job and you
just hired a guy and you got a truck
and it's half of your route and you're
going to lose 75 toilets. Now you
have a tough decision. And ultimately,
youknow, back in probably 2015, I had
a client who. They had four or five
decent sized jobs. They probably
had atotal of 30 units out. And they kept
grinding me and grinding me down
onprice. And it got to the point where
they would call me and just yell
atme and threaten that they were going
to leave me if I didn't do x, Y or
Z. And in this case, they wanted,
like,a case of paper a month extra. And
I said, wait a second. I go, so if
my margin is 10% on your toilets
and acost of toilet paper, a two rolls
islike a dollar. If I'm only making
$10,you're asking for a 10% margin cut?
Yeah, I can't. I mean, as much as
I want to, you know, and what I did
is, I said, listen, I called United
Site Services. I got a rep form that
I knew, and I said, here. I gave
thecustomer the salesman's number. I
said, you know what? You need to
call him. He'll give you the price,
but you're not going to get the same
service you were getting. And so
about a year and a half later, they
begged for us to do the work again.
(19:25):
I think a lot of listenerswill really enjoy hearing that because
the pressure is relentless. I don't
know whether the industry has allowed
that to happen, because historically,
it wasa lot of smaller operators, and they
would feel they were competing against
their neighbours or the operator
in thenext town. For me, the mindset needs
to change, and it needs to change
pretty radically.
(19:46):
Yeah. And, you know, you justhave to have confidence in what you're
doing and know that. You know what?
It's just like we tell anyone who
doesn't have high self esteem of
themselves, they start to do things
they normally wouldn't. When they
don't have a good high esteem, they're
taken advantage of, and it comes
downto us not being taken advantage of.
Your time is worth more than $15
aweek. Like, if a customer's talking
tome and they're complaining about
price, I say, well, well, how much
do I have to pay you to come clean
mytoilet and my house? Are you gonna
drive all the way over here for $15?
No way.
(20:26):
The industry has trained themto expect a really low price.
As you were talking aboutprice and trying to get work done,
you know, something that also came
to mind is you have to be willing
topartner with your competitors. The
trash industry in America, they sector
off spaces and they bid out that
tothe cities, which I don't agree with
at all. I think there's a lot of
unfairness with that. But I do believe,
and I've always done this, is that
if there's another small operator,
andyou're a small operator, communicate
withthat operator where you're thin.
Andif there's an area 30 miles from
your yard or 40 miles that you have
15 toilets, you know, it might be
too far for you to actually operate,
buthe might have ten or 15 toilets there.
And maybe you broker with him and
say, hey, will you do my services
inthis area? And I'll do your services
inthis area. You're still his competitor,
andyeah, you're still bidding for work.
And eventually he might get bigger
than you in an area, and you might
get bigger than him, but in the end,
there's usually enough work for everybody,
and at least you're operating profitably,
because that's really what our business
is about, is route density. And if
you can help a competitor and yourself
at the same time, and both people
canmake money, then that's another avenue
that we've always encouraged at our
toilet companies. And that's kind
ofwhy we did the brokerage as well,
isbecause, you know, it's hard to be
a small family owned business. And
I knew that I could help others through
providing sales and putting other
people together that might have equipment
where others didn't. I noticed that
because United site services would
need equipment, but a lot of the
local companies wouldn't rent back
and forth to different companies,
and sowe would be the middleman. And, you
know, when I sold united, I think
mytop three customers were my competitors.
There's money to be made when you
help others.
(22:29):
I'm convinced of it.Absolutely. I've heard so many restroom
operators say that, and it's a shame
that sometimes the default position
fora lot of people is to be hostile,
to seeevery other restroom operator as
athreat. And yeah, sure, they are
atone level, but it does pay to have
friends. Joe, if I'm a restroom operator
and I'm listening in, I think you
know what I'd like to jump on board
with Joe. What's the best way for
them? A, to get in touch, and then
b, what's the process of onboarding
them?
(22:57):
Our website has a request.Viprestrums.com has a request on
there to become a vendor. It's pretty
easy. And ultimately, we don't always
have a lot of work in your market.
Youknow, there's certain parts of the
country that there's just not a lot
of work, you know, the population's
low orit's farm area, but we will get calls
from time to time. And we can't promise
that your market's going to have
athousand toilets. Like we were talking
about Los Angeles, one of the biggest
markets. But you go into middle America
where there's a population of 10,000
versus millions, it's going to differ.
And that's where you want to contact
every broker. I'm not here just to
try to build relationships with the
toilet companies and want them to
use me. No, listen, the heart of
why we did brokering, the heart of
why we developed a software for our
industry and helped participate in
that is to help others get through
that. Anybody who really knows me
will know that. That's really where
my heart is. Sure I want to make
money, sure I want to get something
outof it, but it's our goal to help
others in this process. And so definitely
call every broker that you find.
Whenyou search portable toilets and you
see that there's all these companies
inyour area, you should call every
oneof them and see if you can help them.
And then be fair, be fair to them
and make sure that you fully understand
what you're getting out of it. And
not just look at them as the bad
guy, but actually understand that
they're a sales team and they have
acost. And really all you have to
do is sign up, call them, and fill
out the form so we know what areas
you service, what areas you don't
service. And so that way we can database
it and start sending you leads. And
ultimately, we are dependent upon
price because we have the ability
tosend out a request to all of your
competitors, and we probably already
are. And we already probably know
everybody's price. And so now we
know what we know the market price.
Itcould be $200 in Rhode island, it
could be $300 in Rhode island, or
it could be a $100. Well, if you're
giving us a price that we can't put
a margin on it, then are we going
touse you?
(25:19):
You're out of the game.
Yeah, you're out of the game.So you got to make sure you understand
your market price. And you got to
know that for us to make money as
a broker, we need to be able to mark
it up 40%. Otherwise, there's no
point of us being in business because
the sales team, advertising, all
ofthat costs money. Odds are if you
search in your area and the top seven
people are brokers, then you might
aswell stop marketing and paying for
advertising. And you should start
calling all those brokers because
guesswhat? You're not going to beat their
advertising. You just don't have
thebuying power.
(25:59):
And that's really crucialbecause the cost of a good employee
inthat sales space would be more than
that independent operator is going
togenerate themselves.
I mean, a good salesman is 100grand a year plus. Yeah, it's ten
grand a month. Advertising could
be2030 grand a month, you know, depending
on the, the size of the market that
you're working in. And so ultimately,
ifyou really consider the market price
of where everybody's at and give
them space to make money, then you're
going to find a teammate, a salesman.
Youbasically hired a salesman, but you
don't pay them until they actually
getyou work, which is the best kind
ofsalesman you can possibly want.
(26:43):
It's a topic that's come up inconversation quite a lot. You know,
at Christmas last year, I did the
daily episodes where people sent
mequestions, and one of them came up
was, should I use a broker? And I
didn't go near it because I didn't
know enough about it and I didn't
havea contact at the time who could tell
me the ins and outs and explain how
the brokerage system worked from
their perspective. So it's been really
good to hear this.
(27:04):
Get a credit cardinal. Iwouldnt bill a broker unless youve
used them for more than a few years
and you trust and youve met them.
Ofcourse I want to say you can trust
me, but you know what? Get my credit
card. Dont bill me. Get the money
upfront. Because from a business standpoint,
from an operator standpoint, cash
isking. You can do much more with the
cash than an accounts receivable
list.Dont chase the money. Its not worth
it. And ive been a vendor to many
brokers or even other companies.
And morethan once, friends have gotten to
a point where they're robbing Peter
to pay Paul and they got way behind
with me. And that was tough. And
Icould see how it can easily happen
when you're running a business and
you're like, oh, shoot, I'm going
tojust put off paying this guy to pay
this guy. That's business. And so
I would always say, get a credit
cardfrom the brokers. Protect yourself.
Yeah,but also make sure you make their
work a priority because ultimately
it'syour toilet out there and it's your
name. And if a broker's not happy
with you, that should say a lot about
you.
(28:16):
So in the brokeringrelationship, when a toilet's on
site and there's a problem, say there's
a tip over or they've run out of
paper, does the customer on the ground
phone the brokerage or the restroom
operator?
Well, in a perfect world,they're phoning the brokerage so
that the brokerage can deal with
theguy on the ground. Now, it's important
that you communicate to the broker
anything that the client calls them
with. When I had brokers, they loved
our company because we would never
take their job. One of their clients
called us and said, hey, we need
another toilet. We're going to say,
okay, well, let me get that over
toyour sales rep and send that over
tothem. Or take the order and send
itto them and say, hey, this one's
yours. Because ultimately they put
in the time and the money to get
that work for you.
(29:09):
So there's a bit of educationboth ways there, Joe. So you need
toeducate the restroom operator to
understand that they need to refer
work back to the broker.
I mean, they don't need to,but listen, treat others the way
you want to be treated, and then
at the.
Same time, you've got to makesure the customer on the ground,
thehirer, knows that they need to ring
the brokerage rather than ring the
driver or the restroom operator direct.
(29:33):
Yeah, or you just communicatethe changes. Like if there's extra
services, if there's a pickup that
they called to pick up, well, let
the broker know so that they don't
keep billing the customer and then
create a, have a, do a chargeback.
Becauseif we don't know you picked it up,
we're just going to keep billing
thecustomer. And then three months later
they're pissed off because we bill
them for two extra months. Communication
iskey. We definitely want to know your
operations manager's number. We want
to have an after hours number. I
mean, these are things that if you
want it to work, like seamless and
be an amazing relationship, if you
can answer the phone 24/7 you'll
neverbelieve the kind of work you can
get. Some amazing things have happened
at 11:00 at night where a lot of
money can be made because of a fire,
a water outage at a Walmart, whatever.
And you know what? You're the only
one who answered.
(30:31):
Absolutely. I've got onequestion which somebody asked me
last week, which is about signatures
oncontracts. Now, I've never got really
hung up about this because I always
figured that there was an email trail
and that we'd had a good record of
the agreement process before we put
a toilet on the ground. But being
abroker based in California, I'm guessing
that you very rarely get on site
with the customer. So are signatures
oncontracts an issue for you? And if
not, why not? And if so, how do you
go around getting the customer signature
on paper?
(31:05):
Well, toy company is thesoftware. They're the ones who sell
the software. And one of our first
things we implemented is that the
customer at point of sale can sign
through the system. The quote gets
sent and the customer is prompted
tosign the terms and agreement. As
astandard operating procedure, you
could easily make it, hey, we don't
complete an order until you've signed
online and then that's data based
inthe system. We also, on all our invoices
state that, hey, this payment of
the invoice which the terms and agreements
are always on, basically is a signature
too. So you kind of want to have
that verbiage in there to make it
known that hey, on almost every document
you get from us, it's got the terms
and agreement.
(31:56):
I got burnt most of all whereproject managers or site managers
onconstruction or civil projects had
called me, asked for a restroom and
we delivered one and then when we
sent the invoice it'd come back,
oh,there's no purchase order number.
And Igot burnt more times with that, arguing
with companies about purchase order
numbers or they'd given me a purchase
order number which wasn't correct.
And Ihad more problem with that than I
ever did with signatures.
(32:21):
Another big thing that wedecided to do is credit cards. I
try to collect a credit card for
most things. Now if Amazon called,
ifDell called like a major traded company
called, we might bill them, but we're
probably going to still ask for a
credit card and if they push back
then we'll deal with that. But for
the most part, we don't want a bill
if we don't have to. And you've got
to show some, you know, hey listen,
ifyou don't have a credit cardinal,
youreprobably not a company we want to
do business with realistically and
we understand the larger companies,
itstoo much work for them to use a credit
card. But unless theyre going to
order 20 or 30 toilets or we havent
heard of you, then were probably
goingto want a credit card.
(33:14):
Allowing the restroomoperators to have your credit card
also avoids them getting stuck in
any 90 day payment terms or anything
that causes them cash flow pain like
that.
Yeah, yeah, exactly. From abroker standpoint and from a vendor
standpoint or an operator. Getting
thecash upfront allows you to easily
beable to grow, and I would always
recommend that. And you know what?
Acollection agent cost 70 grand a
year. So I'd rather pay two or 3%
on the sales and get the money up
front so I can keep growing my business
than to wait 90 to 120 days or not
get paid at all.
(33:54):
Is there anything else youwant to put in this episode? I'm
hoping we can do some more.
Definitely follow up if peoplehave questions or whatever. I'm all
for hopping back on. And, you know,
education is key. Not everybody's
got togrow up and start in the wash bay
and then.
Be a driver next week on the fries.
Not everybody got the wholething. Sometimes you just go after
it. You know, I'm all about educating,
helping others, and I think that
there's a lot to learn from everybody
andmy way is not the best way all the
time. You know, I'm still learning
at 30something years of doing this.
(34:29):
I wasn't expecting to talkabout brokerage this morning, but
Ithink that'll be an absolutely invaluable
episode. I think people will listen
tothat and think, hey, you've answered
alot of questions, Joe.
Well, I appreciate your timeand hopefully we've helped some people.
Yeah, fingers crossed.
Take care, bud.
You too.
Cheers.
Bye.
(34:50):
I'd really like to thank Joefor helping me to make this episode.
Itwas entirely unscripted, and until
westarted to chat, I don't think either
of us really knew where we were going
to go. I've made over 130 podcast
episodes for get flushed and other
shows, and I knew that this was going
to be one of my favourites as soon
as I started to edit the recording.
As Joesaid, brokering doesn't work for
everyone, and I understand why some
operators might be reluctant or openly
adverse to using a broker. You might
think that they're riding you by
charging your units out at full rate
while only paying you 60 or 70% of
the charge. And if you've already
gotplenty of work and a successful sales
funnel, you might not need to take
that hit. But the other side of the
coin is that a broker can take away
all the pressure to make sales, deal
with customers, and chase payment.
Thatin turn could and should free up
alot of time, effort and resources
thatotherwise eat into your business.
Especially if you're a smaller operation
where you're hands on and don't have
a dedicated sales team to chase leads.
In a situation like that, you have
to ask whether it's better to get
70% hassle free or miss out completely
because you're too busy to make the
calls or you can't compete with the
brokers on marketing, sales, and
customer relations. The most striking
thing about today's episode for me
was Joe's openness and willingness
to helpothers. Honestly, we could have kept
talking for hours, and I hope he'll
be back on more episodes in the future.
In the meantime, if you want to know
more about Joe as a broker, please
visit viprestrooms.com or follow
thelink in the notes for today's show.
That's all for today. Thanks again
toJoe, and thank you. I've been Pete
and you've been listening to get
flushed.
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