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cropper's column
Page 87
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Room to manoeuvre
• Room for business manoeuvre should be one of the golden rules of every small operator. While not allowing himself to be caught in any single clutch of outside pressure, he should be careful to consolidate progress solidly step by step. Recently, a driver was encouraged by his haulage employer to set up in business on his own; he bought the vehicle he had been driving on reasonable terms, obtained his 0 licence, and business prospered. His vision expanded, and he discovered what he thought was better work, going into the international field for a different company where the prospects were made to look very attractive.
Better equipment was needed. This is where his mistake arose. He bought a heavy artic on hire purchase, putting down only a small deposit, and he became enchained with hp repayments. The international work itself was adequate in volume and regularity: but it was on payment for the work that the trouble developed. His customer, a firm of brokers in freight transport, was a slow payer, declaring that its own customers were slow — a poor excuse. His hp commitment still had to be met. His customer offered to let him draw fuel on its credit card, which seemed to offer opportunity for relief but enmeshed him yet further. Because of his hp instalments, he had to go on struggling to save his business and recover his own deposit; because of his commitment on fuel, he could now only work for the one customer.
To me, as an onlooker, it appears more and more doubtful whether he will indeed get payment from his customer for work done. In any case he is bound to suffer from low haulage rates because he cannot manoeuvre. He has become the fly in the spider's web, Is the customer to blame for taking advantage of the situation? There are enough business men who do just that, and commercial enterprise-is a hard school.
Yes, school should have been his watchword at an earlier stage. While the school of experience is the only ultimate method of advancing in business it is amazing how few newcomers and business promoters in their early stages seek any sort of guidance. Whether this is because they are afraid to reveal their own ignorance, or whether they fear lest the opportunity which they intend to exploit may leak out to some rival, or whether they cringe away from an analytical discussion of business problems, it remains true that most of them need to obtain professional help. The pathway to success for the small haulier is treacherous and the pitfalls are many. But an outsider's analysis brings to light the problems in a fresh fashion.
Beware of standing commitments which become pledges on future progress. Entering into hire purchase which cannot be bought out if necessary, is rarely wise because haulage has too many ups and downs in work and payments to withstand a situation of financial squeeze, and the wise operator holds on to reserve funds to tide him over the rainy season.
Ralph Cropper