Shed Geek Podcast
The Shed Geek Podcast offers an in depth analysis of the ever growing and robust Shed Industry. Listeners will experience a variety of guests who identify or specialize in particular niche areas of the Shed Industry. You will be engaged as you hear amateur and professional personalities discuss topics such as: Shed hauling, sales, marketing, Rent to Own, shed history, shed faith, and much more. Host Shannon Latham is a self proclaimed "Shed Geek" who attempts to take you through discussions that are as exciting as the industry itself. Listeners of this podcast include those who play a role directly or indirectly with the Shed Industry itself.
Shed Geek Podcast
Insights into Modern Business Practices and Success with Richard Mashburn-PART 1
Richard Mashburn is back on the Shed Geek podcast, ready to share his expertise in navigating diverse business landscapes. How do the auto retail, banking, and shed industries intersect, and what can we learn from their shared experiences? Richard takes us on a journey through the intricacies of these sectors, highlighting the critical role of transforming ideas into actionable strategies. We explore how the rise of technology is reshaping these markets, drawing fascinating connections between them and shedding light on the importance of effective execution.
Communication is the backbone of any successful business, and Richard dives deep into how clearly defined goals and aligned processes can help avoid miscommunication. He talks about the importance of ensuring every team member understands their role and is equipped with the right resources. Richard discusses the challenges and solutions to mismatched roles or lack of contribution and the importance of fostering an environment that encourages success and motivates teams to reach their full potential.
As we tackle modern business models, including rent-to-own dynamics and direct-to-consumer approaches, Richard provides insights into maintaining market positions amidst evolving competition. We examine the balancing act of autonomy versus control in various business verticals, reflecting on personal anecdotes and lessons learned. Richard's candid reflections on business growth, market challenges, and the value of service over compensation offer invaluable perspectives for anyone looking to thrive in today's ever-changing business world. Join us for a conversation that promises to inspire and inform, as we navigate the complexities of the shed industry and beyond.
For more information or to know more about the Shed Geek Podcast visit us at our website.
Follow us on Twitter, Instagram, Facebook, or YouTube at the handle @shedgeekpodcast.
To be a guest on the Shed Geek Podcast visit our website and fill out the "Contact Us" form.
To suggest show topics or ask questions you want answered email us at info@shedgeek.com.
This episodes Sponsors:
Studio Sponsor: Union Grove Lumber
IdentiGrow
CAL
LuxGuard
Shed Pro
Making Sales Simple
Okay, welcome back to another episode of the Shed Geek podcast. And I'm afraid to put my hands anywhere because we're using these wireless mics and I hope that you guys are hearing us, okay, but we're back with I don't even know round three, possibly.
Richard Mashburn:Out on my own. Yeah, Three on my own. This is number five.
Shed Geek:I don't know. We've done a lot. We'll probably do a lot more. I always, always, always get good feedback from your shows. There's also some very well how do I say this without being offensive? There's some people that I think a lot of that are just well-developed business personalities, good business acumen, good heads on their shoulders who are always like. There's certain people I look for on your podcast that I'm always interested in hearing and I'm like you should be interested in hearing from everyone. Everyone's got a good story, but your name comes up top of the list of any of those, so they like what you have to say.
Richard Mashburn:I find it interesting being, I guess, the recipient of the compliment. I thank you. I always find it interesting that people find some of my thoughts interesting, but I do get calls still today. My time at RTO National, my time back on the banking side, the auto side, and just kind of the overlap between the worlds. I think it gave me an interesting perspective I won't say unique, but interesting.
Richard Mashburn:You know, auto retail, auto lending, big banking, banking all overlapped in my career in that field, which I did that a lot longer than I ever did sheds, and you know I tell people. You know, when I was with ADP Digital, you know most people think ADP is payroll but when they did those, you know they owned automobile marketing and advertising firms. I sold one of the first big social media aggregators that anybody had ever made and you know, watched it in its days when it was functional. And you look at those things now in comparison to what the shed industry has done, especially post COVID since 2020, and the parallels are there. You and I joked one night I was there in the room when the investors were pitching Carvana for the first time. You know and you see what it turned into and how much it kind of changed a lot of things. You know. You go back to CarMax, you know and then you think and you look at some scenarios like that as you could compare to the shed industry without getting specific, but some of them you can, you know they're big enough and publicly traded, shed's partnership with Home Depot, some others with Lowe's, and you look at those things Costco and the big box and then you look at that change of what it faces the industry. I think those experiences have served me well in the shed industry because it kind of gives you a view of the possible it's not always going to track the same way because it kind of gives you a view of the possible. It's not always going to track the same way, but it definitely shows you a path that's maybe a little more likely.
Richard Mashburn:And you know, going from the rent-to-own side with RTO National and then doing financing and RTO National to their credit, we played heavy in the tech side. We touched marketing and websites and computers and e-cigs and all those and then coming out as a dealer. I think that's one of the things people ask me is what did you see as a non-dealer that you would recommend a dealer change or do and have you done those things and that's still the humbling part. I was at the GSCB show yesterday and somebody asked me a very similar question yesterday evening and I was like there's so many things I know I should have already done that I've not.
Richard Mashburn:Because, no matter what industry you, because you know, no matter what industry you're in and no matter what you're doing, the understanding and acceptance that time is the most critical asset and value that everybody has and the great ideas that are never implemented are worth nothing. You know, and I've got some acquaintances that I told a gentleman I know that are never implemented are worth nothing. I've got some acquaintances that I told a gentleman I know. I probably even give him a shout out. I don't think he would mind, but I gave him a compliment from my perspective. Somebody I talked to, Joe Shivers, shivers Buildings. I mentioned him in Mississippi. I told Joe. I said I'm always impressed by you and Joe goes well why would you say that?
Richard Mashburn:Because?
Richard Mashburn:you always, you know, when you hear things back about yourself, you know you're so influential on the market. I just started out doing a podcast, you know, and it's like you go.
Richard Mashburn:Well, why? And I was like because in my mind you know, joe's one of those guys. It's not complicated what he does, he just executes. He actually implements four or five great new ideas every year and actually follows through, implements them and I'll be honest with you that one didn't work and I dropped it, but three of them did and the company gets better constantly and I think that was always the struggle. You know, I've had the fortune of running some really big publicly traded. It's just finding that initiative to implement the ideas.
Shed Geek:The value of the implementation is worth so much more than the idea.
Richard Mashburn:Phil and I used to joke at RTO National. He goes that's why I love you, Richard. You've got great ideas and all that.
Richard Mashburn:But Richard will map it out, he'll diagram it, he'll show you, he'll give you the road map and then he leaves it was always up to somebody behind me to
Shed Geek:Every personality test I've got falls heavy on the vision and I'm like there's when I hear people say there's, there's nowhere else to go, there's no place for the next creative idea really in the industry. And I'm like man, I I have to shut down so many ideas because I can't fruitfully implement them constantly. I, I can, I can do a bang up job right and be quote unquote, use your word influential to no avail. Why did, why was I uh, so excited to get this off the ground? That didn't go anywhere.
Shed Geek:It takes a team. I think it really takes a team in most cases If you can find the Willie Mays type of person who is a five- tool player, who can do so many different things. I laugh and joke all the time. I say I'm Mark McGuire, I hit home runs and then I strike out. So that's kind of been my. Consistency is not being able to stay in the middle. Be a decent hitter, just put the ball into play. It's swinging for the fences or you get nothing at all and trying to find those people in the middle who can help you implement an idea.
Shed Geek:What did they?
Richard Mashburn:say, in the profile test, you know 10% of the world's truly leaders. You know and most people would consider themselves when they break down. And you do this like profiles like you and I both spend a lot of time on in different careers. You know, you look at it and you go there aren't really that many people that are truly that, but there are some really great executors you know, and finding those executors and give them the opportunity. And then there's a group that just wants to hey, tell me what to do today. Let me do it for the amount of time I'm required to do it and then let me get out of here yeah, yeah and it takes those people you know you got to have a bunch of them.
Richard Mashburn:And then there's ones that no matter what you tell them and how hard you push them, they're never going to do anything you know it's you know it all kind of breaks down into a societal norm.
Richard Mashburn:But when you're looking at a shed dealer or manufacturer or a concept and how to do it, but yeah, for me it's just, you know, implementing every time I launch a new software or a new idea, you know, here at Banks, then I hurt my feelings and I go out and stop and I realize that I've got a lot with a new hire that doesn't have up-to-date price sheets in the sheds and the signage. It's the basics. Are you there? Do you look presentable? Is it a good customer experience? And maintaining that focus on the basics, the air quote basics, while still pushing to the future for the innovative new, that's the great challenge, I think.
ADVERTISEMENT:Here at IdentiGrow. We have been providing custom nameplates for the shed and furniture industry for over 20 years. We are so pleased to know that shed manufacturers see the value in expressing their shed brand to potential customers using an IdentiGrow nameplate. When you add an attractive decal to your product, you will more than pay for the cost. With increased sales, clients will not only be able to identify the shed brand, but it will help to brand and advertise to potential customers, who can easily see the nameplate and, in many cases, find a phone number or website to shop for themselves. At IdentiGrow, we are happy to continue to serve and invite you to visit our website at identigrow. com or give us a call at 540-283-9193. You can even fax us at 540-283-9194 or visit our website by clicking on the Shed Geek newsletter and then simply fill out some basic information for a free catalog or free samples. Thank you, shed Industry, for allowing us to serve you in identifying your sheds. Identigrow. IdentiGrow Identify your products, grow your business.
Shed Geek:We did a marketing presentation.
Shed Geek:I'm starting to do more of these speaking engagements. I'm super tickled about getting invited to do a keynote in Millersburg and I'm just eating this up. I'm soaking it in because I'm studying so hard to say exactly what I want to say, and I'm excited about the content. To say exactly what I want to say and I'm excited about the content. So, so, um. One of the things that I said in this marketing presentation the other day is a quote that I really love. It says the least, uh, common characteristic among the human race is, um, uh, consistency. It's the fact that we can't be consistent every day. I mean, anybody who who's a who's a weightlifter, who builds muscle, doesn't go a lot at once and then none at all. It's the consistent. A runner, a biker, anyone good in business, anyone good in most any area of their life, has a certain level of discipline that just exists.
Richard Mashburn:And its how many business management books have the word habit. You know how do you create a successful habit 14 steps, 12 days, all the different moving pieces that you think that to your point. It's just how do you consistently go up and you know when you're leading a company or you're leading the way it's, making sure there's people with you and, and maybe more accurately, behind you that are consistent in fulfilling it. It goes back to that piece of the why Are you making sure to slow down to explain to the people around you or the people that are expected to fulfill your idea and vision. Do they understand why? Because if they don't understand why, they'll never innovate, why they'll never innovate.
Richard Mashburn:I used to draw this diagram when I would do training classes about and we would go in back in the banking days or even in the car dealership days. You'd take over a company. The first problem was always take all the people separately and ask them what the goal is, what was their objective? And when you got a new company you would find everybody said something different. That's problem number one. You know the old everybody in the boat rowing in the same direction. How much you know. So, problem one was always everybody defined the goal differently.
Richard Mashburn:But then when you looked at the processes to reach the goal in any company, there were all these little side trails, what I call rabbit holes, that had nothing to do with actually reaching that goal. There was a lot of energy and effort, sometimes very well documented, that had no real impact on what the true goal of the company was. And then the problem you had there was the people that were in that process to achieve that goal. They might know and do good at what they were assigned in that role to do, but they didn't understand why the person in the process before them or the person after them did what they did and they never innovated. And that's why I always call it the big why.
Richard Mashburn:Once everybody understood the why and I would sit in these leadership management training seminars and they would talk about it and they're going. It's not that simple. I said it really is. Problem one is define the goal and make sure everybody in the company defines the goal. The same step two is look at your processes and do they actually reach the goal and eliminate anything that's not truly dedicated to reaching that goal or redefine your goal. You know if you're actually doing something that's that important and it doesn't reach that goal, there's something wrong in your goal definition.
Shed Geek:Your answer. Your answer beat me to my question, but you know the telephone game. You're literally talking about the telephone game. You know. Get everybody out here, show them what to do. By the time you get to the end of it, it'll be something completely different, Like we've all seen and experienced this. And there's a saying that says communication is key. We all grew up hearing this saying. It's been around for years and years now. Right, and there's this new thought that I'm seeing more often that says communication is not the key. Comprehension is the key. You can communicate all you want.
Shed Geek:I'm reading a book right now called the Gift of Giving, because that's what part of my keynote speech is going to be on and he says there's enough resources in the world to feed and get everyone water. We have the intelligence, we have the resources, yet it never happens, year after year after year. It's not because we can't communicate that. We all know that everyone needs food and water. Why can't we comprehend the? We all know that everyone needs food and water. Why can't we comprehend the process to make it happen?
Shed Geek:But we can't Like. There's people starving today and there's people who have excess, and it's like at the most common level we should be able to get food, water, shelter right. Maslow's hierarchy of needs, just your basic needs, right. Maslow's hierarchy of needs, just your basic needs. But we can't do that and that's probably a much bigger conversation that goes along with a lot of other things. But, typically speaking, why? Why can't we communicate so like in a shed company, a shed business or any kind of business? What is the? And you kind of answered it with your points one and two, but feel free to expand on points three, four and five. Where do people fail?
Richard Mashburn:When we would break it down this simple. In my past and I can hear a few of my former team members and leaders that worked with me cringing right now because I would always deliver it very bluntly If you went in to take over a company, especially a fairly large company, then what would happen is you would spend a few days doing these surveys, the employee surveys, defining the goal, looking at the processes, getting all that and then you would bring all the middle and senior management into a room and you would go. Let me explain something to you. The first thing is we're going to define the goal and get everybody on the same page. The second thing is we're going to define the process and make sure it actually is dedicated to the goal and meets the goal. Third thing is actually everybody understands their role in the process, and they understand why the person before them and after them, the step in the process, is important. We're going to give them the why. Then we're going to go look at does everybody have the tools and resources necessary? If you actually have a team that everybody defines the goal the same way, everyone have a team that everybody defines the goal the same way, everyone has vetted the process and it actually is dedicated to reaching that goal and that goal only, and it works. Everybody that works in that process knows their role and why the role before them and after them is important and can innovate, and they have the tools and resources. There are only three possible outcomes Success, if you actually achieve that, success is an enormous likelihood.
Richard Mashburn:If you find an individual that's not having success or is not reaching it, you find you have the wrong people. They're either they didn't understand what they needed, and they said yes, so they need more training, more support, or you have the wrong people in the wrong role. You have great salespeople building sheds. You have great shed builders selling sheds. You know to use them more out there. The third one is unwilling. Unfortunately, when you come into a group and you take over any company or team, the people that can tell you I know the goal, I know the process, I know why it's important and you go well, why aren't you succeeding?
Speaker 3:The reality is they're unwilling.
ADVERTISEMENT:Are you a dealer who sells multiple products at your shed lot? Are you tired of sifting through clunky or overcomplicated softwares to simply sell a product? If so, it's time to call Cal. Consumer Aligned Logistics is the affordable, simplified and scalable solution for your shed carport or even RTO company. For your shed carport or even RTO company, we are partnered with Idea Room and ShedPro for configurators and have multiple RTO partners to choose from, from JMAG to Heartland to Shed Geek Rentals and Scott's RTO. And if your partner isn't listed here, just ask. We are happy to add more. Give us a call at 425-359-3279 or visit calcanhelp. com. That's C-A-L-C-A-N-H-E-L-P. com.
Richard Mashburn:Why are people not willing to have food and water for everybody? Because some people are unwilling to share the food and water they have with enough people, even though it is causing suffering and death to other places. They're unwilling to participate and follow through. The hardest thing, though, is eliminating those people needs to be done as fast as you can humanly do it, and there is no positive outcome to not eliminating that person from your team, because a person you can clearly define if you can sit down with them and they have all the answers they understand the role, they know what's required of them and they just don't do it.
Richard Mashburn:day after day after day after day. You're not eliminating them. So, then the reality is, when you go into a company or team and you take them over and you find positive, negative. Whatever my job and a lot of my career was spent going into situations that were not good I would be recruited and brought in to fix problems. The reality is there would be some small group of these unwillings, but they weren't the problem. The problem was the leadership, the middle management, the senior management or the ownership that was unwilling to do anything about it.
Richard Mashburn:The failure was always on the leadership and the harshness of that meeting was some people would cringe when I tell this story is I would look at the group of leaders that I'm sitting with after we do the surveys and the employee guides and we mapped it all out and we look at them and go and the reality is is the 30% of people we need to get rid of are in this room right now because your other employees aren't performing at their maximum, because they know you're not dealing with the three problem children that you have, because you're unwilling. You're the unwilling one.
Shed Geek:You're the unwilling one to actually lead, take the action, enforce the vision and drive it forward to be successful let's bring this down to a shed level, and I'm going to get really picky here and alienate some of my audience Just a bit.
ADVERTISEMENT:I'm going out, so we're going to do the thing we always do.
Shed Geek:I'm going out on a wire a little bit here. Consignment lots as a good example. I love dealers. I love dealers as much as anyone else but there's just change from one decade to the next. I'm not saying there aren't some consistencies in the way that you sell, the way you market. You mean you talked last time we were here you can still throw 15 sheds out on your front lawn and make a living, and if you're an individual that's fine. But if you're going to move at scale, there's trends in retail that happen outside of the shed world and I told some, I've told several companies this. I almost love to tell this story that you can take and scale this idea that let's say you have 100 dealers, number one and number two always compete for number one right Number three through 10 are interchangeable good sales, 10 through 90 or 95, unwilling to some extent.
Richard Mashburn:Unable or unwilling, it doesn't really matter which one of those two it is.
Shed Geek:Five or 10 of those dealers probably should have got rid of yesterday and you've been debating it for a year anyway. Now you can take that and do it, whether you have five dealers, ten, twenty or four hundred. That's typically the case. I think that most find, especially if it's a consignment situation, there's a dedication that a manufacturer has to his dealer and his dealer network and most of everyone I've seen in the industry has a sometimes even an unhealthy willingness to work with those shed dealers beyond what's necessary. They do their best to help them sell. They bring them $200,000 worth of inventory. That's not enough.
Shed Geek:I need $400,000. That's the only reason I'm not selling is because I don't have enough to sell. But dealers with less inventory are selling more and you have to justify the two and you have to think through these difficult things, especially as a sales manager. What dedication does the dealer have to the manufacturer? And, and maybe answer, what does the manufacturer have to the dealer? Because it's it becomes very frustrating whenever they don't want to embrace any new ideas or technologies, or you know just the way business is done even outside the shed industry a lot of times.
Richard Mashburn:I mean in the southeast. We saw it. You know 18, 19, you know several big manufacturers. One in particular shut down just not due to failure.
Richard Mashburn:They just had to get out of the industry. And you know, in my time at RTO National we saw this several times and the problem is the other manufacturers didn't have the capacity a lot of them to fill the hole on consignment. You were starting to see the difficulty in getting inventory funding at a manufacturing level which started to end a lot of consignment and it changed very rapidly and I think that was forcing for a while there. But then COVID came and everybody sold everything they could and there was a spring back. There was low interest rates for a long time to maintain. So all of a sudden manufacturers had inventory funding lines and were able to borrow money and do these things. Some of them were cash rich because they were selling everything they could build as fast as they could build it, even though material costs were skyrocketing. So that tolerance of an unproductive location or dealer started escalating again and you see that go out there and again. I always thought it was great.
Richard Mashburn:I'm not necessarily knocking a consignment model, but as things get more interesting you talk about consolidation where the bigger getting bigger and the smaller going away and this cost rise.
Richard Mashburn:You know carrying cost of inventory, just the lack of inventory funding. It's harder and harder to get now I mean as a manufacturer myself, you know, and of course the big ones are soaking up huge lines, so the people that have the cash are going. Would I rather back a huge entity or back you know 12 small entities that may not can succeed? And then what are those? It gets harder to make those decisions, but a lot of it, I think, is still the manufacturer not willing to set clear expectations and then enforce them. Then some of it's just the dealer, though, and something you know, I promoted it in my time at RTO National. We started offering consignment dealers their own independent inventory funding and encouraged them to set up relationships with multiple manufacturers, which most manufacturers despise and want exclusivity as they went about it, and it was why because in the era of post-COVID, when inventory was so scarce, you know, I had some clients at those days that you know they couldn't get enough buildings to meet their demand, so it required multiple manufacturers.
ADVERTISEMENT:Hello shed sellers. Let's take a moment to discuss the shed customer and meeting their expectations. I remember growing up in the neighborhood where a certain percentage of the houses had well-manicured lawns and well-manicured homes. These were the type of individuals who felt it was important to purchase a well-constructed home or vehicle, or maybe equipment to help maintain the quality of the item. As shed manufacturers, we seek to provide a well-built, quality shed. We want the customer to feel satisfied that their hard-earned money has been well spent on a product that will last.
ADVERTISEMENT:At LuxGuard, we believe adding high-quality rubber flooring to your line of sheds makes sense to the customer and adds value the customer can appreciate. With each year, sheds are becoming more complex. The customizations we are seeing are virtually endless. LuxGuard not only gives a complimentary aesthetic appearance for their shed, but also protects the floor from spills and keeps cleanup simple. Offer your customer the customer service they seek with LuxGuard. At LuxGuard, we are committed to delivering exceptional customer service and innovative products to help our customers achieve their goals. We strive to meet the evolving needs of the customers. To speak with one of our ready-to-serve customer product specialists, simply call 336-468-4311. To see our product and view an installation video, just visit our website at luxguard. com. LuxGuard the floor that lasts a lifetime.
Richard Mashburn:But you saw what happened in the steel industry. You and I have been around the industry long enough. Used to you could only have one steel manufacturer. That was it. You could have one steel provider as a shed dealer. They'd give you a demo usually, but you had to sell them and them exclusively.
Richard Mashburn:A lot of the steel manufacturers still like to say they ask in their dealer agreement for exclusivity. But if we could poll everybody listening right now, how many of you have one, two, three, four, five steel manufacturers or a dozen steel manufacturers, and it's just become the norm that everybody uses multiples. So, I think the twist happened on both sides of it. You started seeing consignment dealers finding ways to go, become competitive and look for better and better deals from their manufacturers. You had manufacturers facing financial and inventory restrictions and wanting to be clear in their expectations as they got bigger. Then the third front started, which was large, aggregating no consignment dealer company-owned location lots as being the big growth model of a lot of them.
Richard Mashburn:You know I know several big manufacturers myself that converted from a consignment dealer network to their own in-house because you wanted that control. If I'm going to spend the money in marketing and advertising, I wanted the control, I wanted to know what happened to it and I wanted to know when you quit selling for me or you were resigned yeah, I still own that customer in that league you know, and that's you know.
Richard Mashburn:And again I talked about earlier, we're talking about my auto experience. We saw that in auto, even you know. And now the big war in auto, which is a way bigger industry is.
Richard Mashburn:You know, will Tesla continue to sell directly to the manufacturer without a dealer network? You know the big three domestics argued for a while trying to do away with some of their dealer network and did start selling directly themselves a little bit and they still do, but that hadn't quite gone away. But the requirements to be a franchise car dealer for the manufacturers became way more aggressive.
Shed Geek:I want to ask a question so bad right now and I'm trying to figure out because I'm not the source of the idea. I just happen to be on a platform where I can talk about the idea and I'm kind of curious your thoughts on it and some things I talk to you with the microphone off and some things I talk with you on the microphone on and I'm curious about how they will feel about this. But what are your thoughts on rent to own? Probably 50% of all sales in the US 40%.
Richard Mashburn:Average is about 50%. Yeah, it used to be, Probably still is.
Shed Geek:Yeah, I would think thereabouts. Industry, through contracts, relationships, value, those three things give RTO companies a lot of different fingers in the pie. What do you call it, I don't know. However, they say that I'm terrible at puns, but why not direct to consumer?
Richard Mashburn:It's an eventuality that will come I you know, and you're talking about direct to consumer.
Shed Geek:You run around talking to all these companies, build relationships, offer perks, fringe benefits, all these things. You know the manufacturers can almost hold a lot of the rent to own at bay with these dealer premiums. You don't give me more, I go over here. There's not enough yield left to give away. It doesn't exist. It's not a reality. But whoever's willing, you know, willing. What does John Travolta say in the movie where he's a lawyer? He says you spend and spend and spend on these cases and the one to lose is the first person who comes to their senses. And it's kind of that way. How much yield can you give away? When can you go to direct a consumer? And I'm not saying they're holding hostage rent-owned companies, but there's just so many out there right now.
Richard Mashburn:It's just it's, it's, it's well, and I see your perspective. You're going. You know they're holding the rent-owned companies hostage, but the other side is there's a lot of people would say my rent-owned companies holding me hostage.
Shed Geek:Well, I mean, you know, and it's one of those because you know, and you look at it over the last few years? Do you mean by, like, contractually, or do you mean through influence, all of? The above okay well, think about it how many major software operating systems require.
Richard Mashburn:Or I rent. So, you kind of go I want to be a dealer, so we go. Let's be very specific to the shed industry. You know the verticals there's building a shed, there's selling a shed, there's moving a shed and there's payment offerings on the shed. Right, you can call marketing its own thing, but it kind of blends into the selling of a little bit, um, I think. But how many of those control multiple of those verticals or they significantly impact it?
Richard Mashburn:So, as a manufacturer, to grow and scale, you usually need some type of funding to buy materials and support the inventory. You got to set inventory out to be able to sell it or be able to build it and rotate it. So where does that funding come from? We've already talked about it. The vast majority of the funding in this industry comes from the people that are the payment providers. Well then, what did they do? Well, to be a payment provider, I needed to be able to see your inventory, manage your inventory and oversee it, because I'm loaning you all the money. So what did the payments providers do?
Richard Mashburn:they either partnered with finance or bought or created their own software companies that then were locked to the manufacturer. So then you go as a seller, as a manufacturer you then got so because I borrowed my money from this payment provider. This payment provider says the only way I can do it is I have to use the software that works with their payment system, because that's the only way they can check my inventory, fund my inventory and keep track of me. So, then I have dealers that are consignment or independent, that want to sell two or three different brands, but I'm going, I can't control that, but you're going to have to use my software and you're going to have to use my system to be able to do it Right.
Richard Mashburn:Use my system to be able to do it right. So, you know, and you kind of go in or the manufacturer goes. If I can't get enough independent dealers that are willing to do it my way, I'm gonna have to go open my own locations or I can't get my funds.
ADVERTISEMENT:This is James Price of shed pro on faith in business.
ADVERTISEMENT:In 2003, British cycling changed forever. For over 100 years, the British cycling team had never won the Tour de France and only once won a single gold medal. That all changed when they hired a new performance director. His approach was different from any other coach. He applied what he called the aggregation of marginal gains. The whole principle came from the idea that if you broke down everything you could think of that goes into riding a bike and then improve it by 1%, you would get a significant increase when you put them all together. The team changed everything by 1%, even going so far as hiring a surgeon to teach the riders how to best wash their hands to reduce the risk of catching a cold.
ADVERTISEMENT:They found the best pillows to create a better night's sleep of catching a cold. They found the best pillows to create a better night's sleep. They painted the inside of the team truck white so they would notice dust that would degrade performance on the bikes. In just five years, the British cycling team dominated the road, winning 60% of the gold medals. Then they became the first British team to win the Tour de France and continued to win five victories in the next six years. This is James Price. Thanks for listening.
Shed Geek:Do you think it's a value add to move toward one centralized system that's beneficial, or do you think it's a? You know, I sometimes, you know, got into some of the adventures that I've gotten into, not with my initial thoughts of like I want to jump into that. Admittedly, I've kind of I won't use the word forced into it, because you can get into whatever you want. But I mean, like right now we offer services that people are attempting to infiltrate and sometimes you feel like the only way that I can protect those services, and my customers is to jump into a bigger program that offers more. And then the question has become can I do all of that? Can I accomplish all of that? Well, because if I can't, I lose my trusted brand. Very few people do all the verticals.
Richard Mashburn:well, there's great manufacturers that aren't great at selling. There's great salespeople that aren't great at payments or delivery. There's transportation verticals.
Richard Mashburn:You start looking and the whole idea is and I used to tell my partner George we and I talk about it. I said ultimately, if you wanted to paint a utopian vision of an opportunity, it would be to be a manufacturer and make a little bit on manufacturing but build a good building of high quality with a reasonable margin. Have your own sales locations and sell them with a reasonable profit individually for the sale and maintain that distribution. Have a transportation company that is independently profitable as a transportation company but only supports your manufacturing and sales, then be your own payments provider and be able to be profitable enough that you don't have to do it. So, you control all pieces, and you can flex it based on your market need or competition.
Shed Geek:So, maintain some autonomy between each company, but also maintain some synergy if they need to operate and work well together.
Richard Mashburn:Because you always see, you know, if it was dominated by a manufacturer, the manufacturer would air the profits to the manufacturing side at the expense of the dealer or the transportation or the payments provider. If the dealer was controlled by the payments provider, it always aired to the payments provider. You know. More money for the repos, less money. You know all these If it was. Only. There's a few entities, not many that I'm aware of, but there's more and more happening where people that were transporters became dealers and then some of them have even become dealers and manufacturers.
Richard Mashburn:And now they have a very because they're very aggressive on the transportation side, being very profitable at the expense of the other sides. And the reality is there is a certain standard basic economics that says supply and demand. The demand of the market is going to say you have to be competitive in an aggregate of what the customer ends up paying. So, whoever controls all of it and can slope all of those costs to a natural even can actually be more profitable on all than focusing on one or the other, because it skews what the customer ends up paying. The problem I found to it not a. There's a bunch of questions in that, but I wanted to make one quick point.
Richard Mashburn:Software and Meanfield did it and both of us did a joint presentation, you know we went into 2019 with a set of goals and by the beginning of 2020, software had become the sole focus in the competitive landscape. Yeah, that then drove all of it and there is still, in my opinion, not a turnkey solution that is not either heavily influenced, controlled or owned by somebody in one of those other verticals that forces you to not be able to do your purest version of your own business, and that's the thing I've always wanted. I still don't think I have one today myself. I'm working hard with some new partners on how I think about it, and I go I want to be able to run my business with one system and it not be constraining me.
Richard Mashburn:Now, don't get me wrong. It happens everywhere in the car business, all things. You know. I've got software and it requires me to use this accounting system. It requires me to use this credit card processing. You know everybody would love to have open market autonomy, but that will be what then changes it. You know the prediction that somebody said and it's not there yet because of the transportation piece is when there is an open auction forum for sheds, the minute it does, that is, it slopes the competition straight out there, because there's not an open market. That's universal we're in.
Shed Geek:Maybe I'm in rare form. I get asked all the time why don't you go a little deeper on the podcast? And I say well, you know a couple reasons. One I don't want to alienate my listeners by going too deep, so I stay a little bit broad, and I always want to be respectable to all the, the industry you know what I mean. So, all agencies. But you know I'll. I'll go at least a little bit deeper here today and maybe it piques people's curiosity.
Shed Geek:Maybe not, but I just wanted to sell advertising, Richard, whenever I got started. Yeah, I mean, but I just wanted to sell advertising, Richard, whenever I got started. I mean initially, I just wanted to sell advertising and even that was very combative. You know what I mean. So, like once, once I realized wait a minute like we're making people millions of dollars, hundreds of thousands of dollars. I'm not asking to make what you make, I'm saying Hundreds of thousands of dollars. I'm not asking to make what you make, I'm saying I can't even get their advertising. I can infiltrate this place and do well, even if I don't do the best, we can gather a huge market share and that's kind of what we did. And I won't say we've been forced because I don't want to hold anybody out there at blame for my decisions, like we've decided to go here or go there or do this.
Shed Geek:But what I've learned is that, like no one and this is the thing I fall back on, that I'm very, I have very much peace about no one on earth can stop me from helping someone. Sure, I don't care if you control something, manipulate something. I don't care if you control something, manipulate something. I don't care if you have influence over something. There's one thing that people like and it's that they like being helped.
Shed Geek:And there's one thing that no one can stop is they can't stop you from helping someone, whether it's for free, through education, uh, or whatever or direct help. People want help and people will accept your help. They will be happy for your help now, whether or not they'll pay you for it. Right, that is where the disparity comes between being a giver and a taker, knowing when you're owed money for your services, what's fair. We made, you know, probably the first two years made tons people, tons of money, and I was like, hey, will you throw some advertising my way? And it's like, why would we do that? You're making us lots of money without doing it.
Richard Mashburn:Sure, I think you and I you know, before the camera started rolling and the microphone was on, we were talking about some things and it's going. I found it. It was one of the biggest cultural differences. When I came out of auto, I found it was one of the biggest cultural differences when I came out of auto and then the big publicly traded into this space was in those spaces you just assumed everybody was going to do whatever they felt was possible to their own best personal interest or their business's interest and you just assume that. So, everything you did came with that sense of skepticism. I guess with that sense of skepticism I guess In the shed industry I see a lot of people that take a front that somebody didn't do what that individual's perception of was the right thing to do by their perspective, not the other person's perspective, and they always wanted, you know, well I should have been.
Richard Mashburn:You know why didn't you call me and let me do that for you? I could have done it for cheaper. And it's like well, you know, at the time I needed to do this, or I was moving, or I didn't know you wanted to do that, and it's always that.
Shed Geek:But you know I'm going to jump in there because I got that. I remember specifically jumping into marketing and I got a couple of calls that was like why?
Shed Geek:didn't you partner with me?
Shed Geek:Yeah, that's one of the first calls you get and, look, those are great guys. It's not. You know what I mean. But I would start by saying this Everyone I know is always for hire. Yeah, everyone I know is always for hire. You can always call someone and say hey, I was thinking about this and it seems like you'd be the guy or the gal to help us roll this out. But you can't read anybody's mind, so it's like well, I think we can jump into this space. Look, we weren't trying to hurt anybody. Because we believe in equal opportunity, we let our competition I always love it whenever I get criticism because we let our competition advertise on the network. They don't always choose to, and that's okay. I'm like well, you're welcome to. I can't fulfill every customer anyway. Matter of fact, we probably don't have the capacity.
Richard Mashburn:I know we don't have the capacity in in any direction we go in, there's a business for us all to do. It's, it's, but at the same time, that's not an excuse. Or is it asking for a pass? Should I have to apologize for doing I? Just wish people would be more honest. No, I've made a decision that I thought was in my best interest, in the best interest of my business at the time, and I followed through with it and I'm looking at you going and you were not that decision and I'm okay with that and I hope you are too, and I made that decision and I and I made that.
Shed Geek:Ultimately, I had to take that approach to a couple things. I must be in super rare form today to even talk about this, but it's. You know. One of the perfect examples is I'm going to move forward in this area and I would like for you to continue to be an advertiser. No, I'm picking on advertisers just for a minute. No, I won't be an advertiser because it gives clout to your platform and I need for your platform to be diminished. But on the backside of that conversation is we want you to be exclusive with me.
Shed Geek:So I'm either ultra valuable or I'm completely not valuable at all.
ADVERTISEMENT:Are you swimming in leads but struggling to close the deal? It's time to turn those leads into profits with Making Sales Simple, the ultimate sales training program designed specifically for shed sales professionals. At Making Sales Simple, we understand the challenges you face overwhelmed by inquiries, unsure how to follow up, and missing opportunities that can boost your bottom line. Our proven techniques help you and your team master the art of connecting with customers, building trust and closing deals like never before. Whether you're new to the industry or a seasoned pro, this training will sharpen your skills, increase your conversions and drive your business to new heights. Don't let those leads go cold. Invest in your team's success today. Making sales simple, because every lead deserves a closer.
Shed Geek:And that's probably my flawed perception of the way they should react.
Shed Geek:They can choose to do whatever they want, and I'm not picking on anyone in particular, just to be clear. There's been a couple of those conversations that you're like, wow, this is weird, and I just never found myself in that area of business. So, I have to go back to what I know, which is nothing in this situation, and make the best decision. I know how to make for our business, our family, all of that, but I've never. I always promote even other people. It's always your fault when you're not willing to do somebody else's you know,
Shed Geek:to their best interest, you know, and that's the reality.
Richard Mashburn:I guess that's my thing is. I'm just surprised that people take it so personally that human nature is what it is, you know, and it's not to say people aren't good people. I don't think any of this. I think that was my thing coming up in a very a harsher more for us, face it. It was a cutthroat environment. Yeah, you know, especially in the early days in auto coming out. You know the early, but you've helped me even in this situation.
Shed Geek:You've called me out. You know you've been like why are you? Why are you being so sensitive to that? And I'm like, I don't know.
Richard Mashburn:Thought they were my friends yeah, and it's like what about friendship has anything to do with making a business decision, you know, and it has and you kind of wish you had that advantage to say you know there's all these kumbaya moments, um, but the reality is I think it just has to become more second nature. And that kind of goes back to our whole deal of people making the hard decisions. You know, how many people do you know that actually made a business decision based on a personal tie or a friendship and they ignored the screaming business signs and then after the fact got burned horribly for it? Yeah, you know, and I used to tell people, you know, I'm all about generosity. I feel like I'm a fairly generous person myself, both you know, helping others and family and friends, but I'm also a very good one. Like when my son coming up, I'm going but never give away anything you're not comfortable just walking away from and not getting anything for, because if it's not a true act of charity or goodwill, then it's a business decision.
Richard Mashburn:And don't pretend that the two overlap.
Shed Geek:It's. You know what I mean.
Richard Mashburn:They kind of separate themselves. We kind of went to a different place with it when you start talking about business perspectives and how you build things.
Shed Geek:You know, I'm still Well, and I bring up the podcast just to be clear for anybody listening, not to scold anybody. I bring up the podcast because it's my experience. Sure, I can't speak on your experience, but I do know this. I've talked to I don't know, we've done 300 interviews. I've probably been in 30 states. I've talked to 3,000 shed dealers at least you know, and more people in the industry, and not one in a deep conversation.
Shed Geek:Have I not come across the hint that they've had a bad business relationship? A hint that they've had a bad business relationship situation? A partnership fall apart? You know what I mean, whatever the situation is. And you know, I think I had a lawyer friend of mine one time tell me the same thing. Thank goodness that you're honest enough and vocal enough to tell me too, because maybe because of our friendship, I don't know. But this lawyer friend of mine told me the same, says well, you're just naive and you're just like. You can't talk to me like that. And he's like no, you're naive. I mean, what makes you think that a friendship's going to outlast with you know? A business decision when marriages fall apart after 30 years. He said you're being completely naive. That's why it's important to find a way to separate what your business relationship and your personal relationship is, and that's really hard for me because I tangle them all together and I don't know another way.
Richard Mashburn:I love this Again. I hear my wife cringing when I tell this story. But do you know the children's story in the book the Emperor's New Clothes? I always found that an interesting story growing up, you know, and I had it and read it to my son, who's in his 30s now and I've got grandkids. But you know, if you've not read it, you know the premise is you get out there and you go. You know there was this emperor and basically two con men got into the castle and convinced him that they had made the most beautiful clothes. But the royal court were all lackeys and were afraid to tell the emperor, who was afraid to tell them he couldn't see the clothes because they weren't real, so everybody agreed with him.
Richard Mashburn:It was the most fabulous and he looked the best he ever had. So now the emperor, who's afraid to disagree with these two great salespeople and whose royal court now enforces it, decides to take a parade out into the community naked, because everybody's not. No one is willing to tell the emperor he actually has nothing on and they're all fine. Oh, look how beautiful he is. And as it spreads it just becomes a commonality, until a small child walks up in the middle of the road and goes. He's got no clothes on.
ADVERTISEMENT:And then the facade collapses, and everything goes around you and you kind of go in my own personal career coming up.
Richard Mashburn:I actually did this. My wife was so angry with me. I bought a bunch of copies of the emperor's new clothes and sent them to one of the boards one of the publicly traded companies I work for, and I signed them. I'm not saying it went well for me, but the problem is sometimes you can convince yourself because you're getting feedback from others that are just willing to agree with you. You know that whole thing. I think I might have even heard it on one of your shows. One of your people, one of your interviewers, said you know, people listen to respond, not to understand. So, everybody gets caught up in the fact. Now they've said something, and they put a response out there. That then manifests an idea that even they don't believe in and can factually disprove.
Shed Geek:But it becomes fact because it has a life of its own and it rolls and I feel like the shed industry, or they're just afraid to back down from it.
Richard Mashburn:Well, and I think we're still all dealing with that hangover from the just raging pick-it-out-of-the-sky success of COVID in the shed industry. You know, for two and a half, three years you can sell and make money doing almost nothing. People were lined up. You know, and it's amazing over my year, year and a half of doing my own thing, how many people I talked to going man and they're new. You know they started in 21, 22, and they're going.
Shed Geek:It's hard now, you know it's really hard, you know it's still not as bad as it was in 18 and 19.
Richard Mashburn:Really hard, you know. It's still not as bad as it was in 18 and 19. You know 19 was staring down a barrel of 20. That looked bad as an industry, you know. You know my job was to forecast the industry and we were looking at a fairly significant decline in annual sales at that point and sheds heading into 2020. I mean to the point we're talking about six, seven, 8% decline nationally in shed sales.
Shed Geek:And with COVID happened everybody it exploded, they fell apart until they realized there's all this and I think, some of this now is there's still that hangover.
Richard Mashburn:We're all talking about it. We take it so personally that we're not just instantly successful and everybody wants to be, instantly gratified by our success enough to want to do it for themselves.
Richard Mashburn:You know, and I think that's a lot of it, but I think in the end it breaks down to just the core basics of the business decisions. You know the financial irresponsibility, you know unfortunately. You know I'm down here in South Carolina and you know in that western North Carolina Georgia market and we've seen a handful of dealers go under and manufacturers go under just due to mismanagement you know, and are not having a good game plan or putting faith in somebody or someone that they probably shouldn't have.
Richard Mashburn:You know, and some of us have taken advantage of those situations that have come along because it just pointed out did.
Richard Mashburn:I do the right thing by helping a company that got stiffed on a bunch of debt, by taking some of that debt for them and by absorbing. You know, yes, I did. You know, can I pat myself on the back that I helped them out more than I did myself? I can, but in the end it's a lie. It was a business decision, it just was, and if I try to go sell it as something else, I'm not being true to it. But I can tell enough people that I did that. Eventually they'll tell me my clothes are beautiful, and I think that's the thing. Some of the facades are starting to fail. You know, it was one thing when a shed was $3,800, you know, four or five years ago. Now an average shed is, you know, $6,000, $7,000. Now we're all playing in tiny homes and big buildings. And you know a mule's. You know $50, 70, 80. I love that big. What is that? The mule?
ADVERTISEMENT:guy thing. I love it. That's like, you know, the Hulk of a mule and I'm going.
Richard Mashburn:It's $100,000 plus you know I remember when mules were 15, 18 grand and it's going. You know we're playing at a scale now and I'm not saying it's not worth it. You know you were sitting here talking about I'll go open a consignment lot Used to. You could open a consignment lot with 75, maybe 100,000 and it would have 30, 40 sheds on it.
Richard Mashburn:Well now, 100 grand doesn't put 10, 12 sheds on a lot. So now it's a quarter of a million dollars to outfit a reasonable consignment lot. Well, that investment scale is different. You know, four years ago when you put that quarter of a million out there, you had a carrying cost on your funds either your cost of your own money to put out there and make nothing on, or borrowed money. That was at 2%, 3%, 4%. Now that money's at 8%, 9% or your lost return on your possible revenue is higher, the game's changed.
Shed Geek:Do you even see? I'm just curious if you were starting fresh right now in the shed industry and I'm going to use rent-to-own as the conversation piece here would you see the same? Well, it seems the obvious answer to the same value now in getting rent-to-own as previously, the obvious answer is no. But in general, do you see a lot of benefit of being in rent to own? Now, like with the competition scaling the way? It is the price of money, all the things is it? It's profitable, but how many people want to be in it? I'm just curious. Thank you for listening to part one of a two-part series. Be sure to tune in next week for more engaging conversation here at the Shed Geek podcast.