Working "with" the enemy...
Here is the link to the interview (please read article first)
http://www.youtube.com/watch?v=ZpwYZNycZdo
Like it or not, our industry is dominated by national assembly companies (NAC’s). Do you consider the NAC’s your enemy? If so, is it ever ok to work for them?
If you are an NAC, do you consider the tech that runs his or her own assembly business “your” enemy? If so, do you have any techs with their own assembly business working for you?
If your mentality is considering a resource or competition as your enemy, you will never get anywhere in today’s world and that goes for both parties! People becoming more Internet savvy everyday and you better keep up.
Our industry (in its present state) has been around for a very long time, and I am not sure it is going to change anytime soon. The techs have issues with the NAC’s and the NAC’s have issues with and problems keeping good techs.
Some NAC’s claim that the tech needs to take the bad with the good; you may be wondering what does that mean. The good is a job that you can drive to within twenty minutes or so. The bad means if you are dispatched a job out of your area you need to take it or risk the NAC developing an attitude with you. However, when you factor in extended travel and one low paying job… the bad is just not worth it.
The NAC’s are the ones that need to take the bad with the good. What that means is, if there is a job out of a techs area, the NAC may need to payout twice or possibly more of what the job pays to ultimately keep the client happy. How many of you have refused to do a job because it was just too far away? How many NAC’s (do you know) lost accounts and went out of business because of this scenario?
If there are three or four of similar low paying jobs that are a long distance and in the same area from where the tech starts, it’s more likely the tech will make the trip, but that rarely happens and when it does, the NAC needs to “attempt” hire someone in that area.
Another issue for the NAC’s is they think the tech should only get a certain percentage of the job. Granted, the NAC’s have over head, but I think they forget (or don’t care) about the techs overhead. For that matter I don’t think some techs consider overhead at all, not even their own.
I can’t determine what any tech is worth, that is up to the individual, but a tech working for any NAC should be making at least $25 per hour for their work (including the drive time).
All independent business owners should be somewhere in the range of forty to sixty dollars an hour or more depending on there company size. WHY??? “I believe” the tech has more overhead and the percentage ratio of profit is much lower for the tech than any NAC.
A tech (as a contractor) pays for his or her own gas, vehicle maintenance, insurance (business and vehicle), licenses, yes tech, read your contract…you are responsible for any local license requirements but I do believe that could be challenged and the NAC’s could find themselves in deep trouble with local municipalities; the tech also pays for their own tools, work clothes, cell phone, Internet connection, office supplies and that list goes on.
If you contract with one of the NAC’s, you “are” in business for yourself; and if you understand that and are not pursuing work outside the NAC you are cheating yourself.
If you are a contractor, and go after more jobs than the NAC you contract with dispatches to you, there may be a few other things you need to take into consideration that the NAC’s do not. Already mentioned… licenses, some municipalities require a contractor’s license to install products such as basketball goals. Then there are the dreaded taxes, when the store they contract with collects for services they should be collecting sales tax. That’s right; some states require businesses to collect sales taxes for consumer services, even assembling products.
What it all comes down to is the independent and NAC’s need to learn to work with one and other until the industry is able to figure out a way for us all to make money and get along…
Right! Like that’s going to happen 
The battles rage on…
Mike Mehrle
http://TheSavvyTech.com
614-218-1861
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Categories: Newsletter Articles
Tags: United Assemblers National Assembly Companies Al Gore Bodycraft Networking Mike Mehrle Assembly Interview Tech on corporate retailers
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Mike,
There is truth to what you wrote, however, I will disagree on this point; you stated that the NAC's profit margin per job is higher than the tech's. This is not true in many cases. While some techs think the NAC is just "raking it in", the reality is this is a very low margin business. Trust me, I know. And as I am now disconnected from this industry other than our occasional chats, I have no ulterior motives either.
If a tech is an employee of an NAC, it is not feasible for him to realistically average $25/hr. Even as a contractor, he will not likely earn $40/hr due to the overhead of the business.
The services provided by a tech are expensive, especially from a consumer perspective. If you charge $100 to assemble a treadmill that cost $600 and the job takes you an hour, this is hard to swallow by the customer. But in order for the chain of players to get paid, this is how it must be. You have the retailer, the NAC, and the with their hands in the cookie jar, and there's only one cookie.
I stated it on a previous post, and I will state it here again. The opportunity for the independent tech is not with the NAC. That is dead. Do yourself a favor and set up a website and learn how to market locally.
The tools are there, use them. Facebook, Twitter, Linkedin, Craigslist, Angieslist, Google/Yahoo PPC, and many others. You can create your own local assembly company and earn much more by targeting the consumer through their internet purchases.
How many people do you know that shop online? How many of them did 5 years ago? 10? 20? Obviously this is growing and the online retailers don't have the desire or leverage the B&M retailers do to establish a national network.
Small is the new big.
Bobby Casey
www.globalwealthprotection.com
globalwealthprotection.com/blogspot
fmr President Diamond Retail Services
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Bobby,
We are not comparing apples to apples here; I never use the word employee. If I did, you would be dead on.
Any business, be it an assembly or any other business, there needs to be a “gross” amount made to “net” a certain amount of actual profit. When I say a tech needs to make $25 an hour with an NAC, I am talking about the self employed tech.
But when we talk about employees; there are very few assembly companies that pay by the hour. When they do… of course they cannot pay $25 an hour because that employee costs the employer twice that or more to keep them employed. Reason being; the employer has the burden of “most” of the business expenses and keeping the business coming in.
Too many if not all NAC’s require delivery, which is the thorn in the side of this industry and what drives up the major expense for the tech. That expense is not just tearing up their own vehicles; it is waiting on the store to load them up. I have personally seen it take over an hour to be loaded because the store associate is taking care of customers. The NAC’s do not compensate for any of this… EVER!!!
Most NAC’s take advantage of the “remote” tech (not always intentionally) by placing business expenses on the tech. If I were to find employment here in my area, my employer would be responsible for the cost of my employment.
Too many techs “don’t” know what it takes to run a business. They have been use to an NAC just handing jobs to them, kind of like our welfare system, but of course without the job. Why would anyone on welfare want to actually work at “getting a job” when they can lie on the couch and have their necessities handed to them?
An assembly “business” is more than turning a screw here and there to get paid for doing just that. If a tech wants to be in the “business” they need to understand there is more to it than just turning screws.
There are going to be some techs mad at me for comparing them to our welfare system but the truth hurts and I am not here to win a popularity contest; I am here to help the tech that wants to take this industry back… Period!
The “REAL” resolve here is for the corporate stores to smarten up! I believe that will happen by attrition of the NAC’s in the not so distant future; but it is going to take a lot of hard work on my end convincing and educating techs that have been used and abused on how to become truly self-employed.
I am not looking for followers or people to just list on the network website and expect to get jobs from it, if that is what they want... they deserve the NAC’s. I am looking for an army of Captains that know how to run their own ships and have some national unification with other Captains doing it. I also don’t care if there are twelve or twelve hundred on the network.
MikeM
http://The-Savvy-Tech.com
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Mike, This is a great newsletter. I hope everyone understands what all you are saying. I know from every aspect of the industry how things work. I have been in upper management before with a NAC. I do know the profit margins are low when every one has the hand in the money pile. I have been the tech before and after this position and currently a IBO. The customer will always be willing to use the IBO for it would save them some money and help the IBO make more profit by not having to deal with the NAC.
This would be less of a problem when more IBO become internet savvy and learn how to market themselves. There are a lot of customers that do have a hard time searching for a repairman or assembly person to help with their needs. I am learning more about the internet and would like to help other IBO's do the same thing. What the UAN really needs is UNITY among us all to work together to weaken the NAC..
UAN All for one and one for all!!!
Eddie Young
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Well, here you have a part-time tech that currently accepts jobs from two NAC's and does do work directly from the end consumer. One NAC pays $30 while the other NAC pays $75 for the same job. It can be a good thing to work with the NACs if you can get on with a good one. In addition to being an independent tech I work a great 40 hour per week job, so food for the table isn't the motivator for me.
A topic not covered in Mike's article is payment for services. NACs can take up to 90 days to pay while end users will usually pay at the time of service....something to consider if this job is providing food for the table.
We all have different circumstances and needs. We each have to find that happy medium. I think NAC's will always be around and there is plenty of opportunities for independents. How many independents out there want work? Have you visited an apartment complex lately? Many have workout rooms and their equipment is typically in need of repairs & or PM. Use the phone book to call local complexes to find out which ones have equipment and when the manager will be there...shower & shave, put on some nice clean clothes and take business cards. Always follow the visit with a phone call.
Have fun....life is too short for the alternative!
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Scott,
Great point about payment terms. Even if the NAC pays you in 2-4 weeks, when you work directly for the consumer, you are paid COD. Cash is king.
Another point is if you are working independently you can charge much less than the NAC but 'net' more in your pocket. A consumer who shops around and finds that the in-home assembly charge from Dick's is $80 will be more likely to purchase the item online and ship it to his home and pay you $50 for assembly. As previously stated, the e-tailers are the independent guys big opportunity.
Bobby Casey
www.globalwealthprotection.com
globalwealthprotection.blogspot.com
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Don't forget... if the tech is to make more money than what an NAC pays, the tech needs to make sure the direct job from a consumer pays for everything they do to generate the actual job. A tech does not generally work eight hours a day assembling things through their own business or any NAC.
You can't go by what the NAC is paid by the B&M retailer altimately paid by the consumer, because the NAC is generally regulated by what the retailer allows to be charged... SOMETIMES... not enough and is why the tech is generally underpaid for the job through the NAC.
You also cannot go by the price of the product. I have assembled tables that cost over $500 and if we set our fees at 30% of the sticker price an assembly fee of $150 is way out of wack.
However it goes in the opposit direction too. Just because a product has a low sticker fee, that does not mean you need to reduce the assembly price. There have been times when I charged more for the assemly than what the product cost the customer.
Bottom line... you need to set your prices to what the market bears and more important, you need to set your price on what "YOU" are worth.
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And herein lies the rub. Just because you think you are worth $50/hour doesn't mean you will find any customers willing to pay that. This is where a basic understanding of economics and common business sense comes into play.
If I get 2 customers at $50, 5 at $40, or 30 at $30/hour, I need to do a cost/benefit analysis to determine the right price. And you are spot on that many independents don't do this sort of thing when running their own business.
You need to be customer centric here and work backwards. What does the customer want? How much is the customer willing to pay? The services you offer and the price you charge are both completely useless unless they alight with the customer demands.
Bobby Casey
www.globalwealthprotection.com
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The goal of every independent assembler that receives work from an NAC should be to wean their company off and break free from any dependence they have for income, work volume and job security. The long-term goal should be for the independents to keep 100% of the commissions earned without splitting them with the NACs. The long-term goal should be to land every delivery/assembly/installation/repair job either directly with the customer, retailer or manufacturer with no middle-man involved taking their piece (sometimes majority) of the pie.
For many independents that is viewed as a challenging and risky goal to achieve. From my experience, signing on with a NAC does have a few advantages, the biggest being no $ or time required on your end investing in marketing or advertising. Just sit back and wait for the jobs to be dropped in your lap, call & set your appointments, and drive out and complete them. There is a huge danger, however, in being in that position. The "job security" can lull yourself into complacency and comfort to the point where you accept your menial income the the NACs payout as a way of life to squeeze by and pay your bills and feed your family. In essence the blinders are put on you and the great opportunities that this industry STILL has available for major success are passing you by right before your eyes.
For all the techs that are signed on with the NACs, lets "use" them before they "use" us and they squeeze every bit of talent, energy and tech-savinesss out of us to the point of burn-out and health issues (face it, many of us aren't getting any younger). Lets "use" them as a stepping stone and gap-filler until your on-line presence is established and your company's name is deep within your community/region to the point where a steady stream of assembly work is flowing your way. For those of us that persevere and break free, that will be an extremely rewarding day when we can turn in our 30-day notice along with a "Sayonara forever!"
Bruce Harapcio
Metro Assembly Services, Inc.
1-888-255-1716
www.metroassemblyservices.com
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Mike --- informative interview with Al from Bodycraft, thanks as always for your hard work and effort in all that you do. If given an opportunity, I'm positive the quality techs in United Assemblers can enhance Bodycraft's good name nationwide through our services. High-end equipment also means high-end charges, its easy to win-over a $300.00 one-man assembly for a $4,000 piece of equipment, woo-hoo! And add-on $50.00 to haul the pieces from the garage (NO inside deliveries for most carriers) into the basement.
My question is the use of this video on the network's website. This and future interviews can connect and create some decent inroads with the industry insiders, including retailers, manufacturers and CEOs/Owners. It'll be a challenge, however, to get the average consumer to sit through a 8-minute "commercial" filled with just monotone conversation with no graphics or demonstrations involved. Without the eye-catching visualization the attention span just isn't there in our 30-second-at-a-time AD society. So I see the success of these type of interviews predominately in opening doors for landing accounts and capturing the power-brokers attention, but not so much the general public.
Bruce Harapcio
Metro Assembly Services, Inc.
1-888-255-1716
www.metroassemblyservices.com
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Bruce,
The interviews are not meant to be a commercial... they are informative segments for Bodycraft anyone else that wants the same type of exposure. We have over 1,700 page loads last month and 2,200 in January... thats good exposure for anyone.
The full length video is not on our website, it's on the Blog. It is more acceptable for longer videos on a Blog than it is for a "commercial" on any website. So you are right... in a way.
I am going to do a 30 second clip of the best from the video, add graphics and place a link to "click here" for the full interview. I am on it... geese I am only one guy
I don't know exactly who yet, but next month or sooner will have another great interview... Watch this network grow as we help businesses in this way....
I AM PUMPED!!!
Again... Thanks for all of everyones input so far
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I have only been in this industry for about 15 years now and I have seen a lot up and down. I do know we do need each other and if we could ever get it straight we both could be making money the NAC and the independent. I use both but I depend on my own resources to get work and learned you can't count on the NAC's or any manufacture or company. If you do you will lose. How to get both to work together is the mountain to climb and conquer.
There is much to learn about the internet and by the time you figure it out it changes.
I know we all have expenses, I, like Mike, do know nac in MOST cases don't think about that end, just their expenses and may not even care about ours. Everyone including the customer wants it cheaper no matter what you charge.
Good post Mike
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Wow... I know this is unusual; however I pretty much don't have much to add here as Bruce, Charles & Eddie have done a great job here at laying down the "Tech" facts. Two things I will touch on though is the great idea to offer manufactures the opportunity to do interviews at Mike's http://www.socialmediatelevision.com studio and for those of you on the fence, to step up and get yourself involved and pay for a Premium listing in your area so you too can benefit from all these great happenings!!
Not only does this provide manufacturers with free online “video” advertising to promote their products, it can also blossom a potentially great relationship with the UAN to provide their “end-customers” with quality on-site assembly technicians they can count on and feel confident referring their customers to that have purchased their products and would like to have them put together “Professionally”.
I parenthesize “Professionally” for good reason; anyone can go on Craig’s List and find a handyman with tools in his trunk that “says” he can do the job… cheap! I know a few of them that do things around our neighborhood… shrubs, painting, tree removal, etc… however I would NEVER hire them to put together a home gym, assemble & install office cabinets or build a play set my kids will be playing on. I would much rather pay the right price to hire a “Professional”.
If you are an independent assembly technician reading this, you can see that things are happening on this network with or without you! If you are in an area that this network does not currently show a Premium listing for a “Professional” assembly technician, then WHAT ARE YOU DOING!? I know there are hundreds of techs that know about this network… why you would not have a Premium Listing for literally pennies a day is amazing to me. Not only does Assembly Masters have a Premium listing, we also spend $100’s of dollars in other online advertising that brings in 10 FOLD the investment!! If you need help getting off the ground with your assembly business, then SPEAK UP AND GET INVOLVED!!
Todd Jefferies
http://www.AssemblyMasters.net
"We put it together... So you don't have to!" ®
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