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Wulaw Horn

Burnt Ends
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Posts posted by Wulaw Horn

  1. 11 minutes ago, Iceman said:

    Not family owned. Bigger.  Way bigger. 

    For all the shortcomings of corporate culture/ behavior, right now that size and strength is protecting our folks' earnings and allowing us to continue to take care of our customers in a way they expect from us. We did some stuff during Harvey that was home run, out of the park wins with our people.  Now we're seeing it again.  There have always been trade offs for not working on my own or for a family firm.  I am proud of this right now.  Nobody is perfect, but this is very, very good.

    I thought you worked for a big brand, not a big grocery store. 

  2. 29 minutes ago, Spaulding Smails said:

    Subscribed.  I've posted in two of the other threads, but I have a construction (residential and commercial) and facility maintenance company in Austin.  65 employees currently.  80% of my workforce can't work remotely.  I was incredibly optimistic yesterday that construction was an "essential business".  Local trade organizations, my builder customers and my attorney agreed.  Last night, the City of Austin Development Services sent out a memo strictly forbidding construction.  We have until Friday to "make safe" job sites.  Now, I'm scrambling to figure out how we deal with those repercussions.   Tons hinging on the details of this most recent $2T bill and its effects on unemployment and small businesses.  An interpretation of that is going to have a huge bearing on my decisions over the next week.

    From a general business sense, here's my takes:

    THE GOOD

    -Our balance sheet is super clean.  Minimal debt.  We own our property.  Big line of credit sitting idle.  Lots of assets paid in full.  

    -We pay our vendors and subs super fast.  I can extend those terms and create additional cash-on-hand if needed.

    -Our company is very diverse.  We offer a wide range of services to a wide range of markets.  I want more of that diversity when this is all over.  It's going to be huge in saving our ass.

    -We have a strong backlog.  Though not on par with a big commercial firm, we have a legitimate 90 days of work.  I want to challenge my team to secure more work.  It was said above, but we're going to shift our business model during this downtime to create more commissioned sales opportunities on the service side.

    -I should still have cash coming in.  We have 30+ days of revenue store in accounts receivable.  Assuming those invoices don't hit snags, I may actually see cash reserves increase in the next few weeks.  

    THE BAD

    -The first bill includes guaranteed 80 hours of paid time off for employees.  That takes effect April 2.  That's my deadline.  Though that would be reimbursable to me in the form of a payroll tax credit, it would be a huge hit on cash flow to float 65 employees with minimal revenue.  I have our HR consultant helping me figure out what we're going to do, but we have to act by April 1.  That's probably going to be layoffs for a few salaried overhead positions and anyone that has been with us less than 90 days.  

    -If this thing lingers for longer than a few weeks, we're probably going to have to lay a bunch of people off.  I don't envy restaurants, hospitality, etc.  They've already had to make those decisions.  I'm dreading it.  I've developed a tiered approach, but I'm guessing I'll have to reduce workforce by 1/3 if we're not back to work April 13.

    -When we get back to work, demand is going to be pent up.  It will be short-term, but jobs that were underway are going to want to catch up.  Jobs that were supposed to start April 1 are going to want to start immediately.  Jobs that were going to start mid-April are still going to want to start mid-April.  We're going to see a big push with limited resources in a very short amount of time.  

    -The supply chain will be taxed when we get back to work.  Nothing will be easy to get.  We've already banned our guys from going to Home Depot between 7 AM - 5 PM because the lines are so long. 

    -We'll probably see a jump in the price of materials.  Tightened supply will lead to higher prices.

    -We're going to get undercut.  We're a premium service provider.  We lost a job this week to another smaller contractor.  The ripple effect will be stronger and more continuous as people get desperate for cash and sacrifice profitability.

    -The backlog is going to come to a screeching halt.  Once we work through what we have, new jobs are going to be few and far between.  As mentioned elsewhere, commercial development is going to take a huge hit.  You have to think that residential construction will be the same.  Hence my previous point about a much stronger focus on service.

    Thanks for creating this thread.  Great to have a sounding board.  If nothing else, misery loves company!

    Have a ton of thoughts/questions on this post but it’s long. You’ve got a super interesting situation there amigo. 

  3. 4 minutes ago, Texas Jeff said:

    Texas has a dashboard a lot like the Johns Hopkins dashboard, but not as informative (no data over time):

    https://txdshs.maps.arcgis.com/apps/opsdashboard/index.html#/ed483ecd702b4298ab01e8b9cafc8b83

    Using that data, right now 79 of 715 cases (19%) are in Travis Co.  But, Travis Co has about 4% of the state's population.

    So, is Travis Co simply more disease-ridden than the rest of the state or simply testing more and finding more cases?  Honestly, I could go either way on that one...

     

     

    My guess is some from column A and some from Column B. 

    Population density in Austin is obviously higher than suburban or rural counties. I’m sure they are testing at best higher rates. And, Austin has a bunch of affluent travelers and is a destination city for travelers themselves with tourism, bar scene, UT, the government etc. I have to imagine it’s both factors playing a role. 

  4. 5 minutes ago, UTexasFight said:

    Lulz
    Kroger third worst today in the S&P500.
    (Although only down 2.99%).

    Market: fuck groceries! We gettin trillions! TRILLIONS!!!


    Also in the bottom 10 today:
    Costco, Netflix, Clorox, Verizon, EA Sports.

    So everyone who should be doing well and posting serious earnings during this crisis. Ok. Buy the rumor sell the fact. 

  5. I miss my office. It’s a hole in the wall that I pay $500 a month for but I can sit in there with my white board and my production partner and not have to be at home around little kids. No way I’m ever giving that up to WFH. 

    Of course they’ve tried to talk to me about getting an office befitting my status as a titan of industry where we can show off and show out for customers and my response always is- nope- not unless you show me that this office will make money by virtue of its existence. I don’t think many locations in the service sector do, quite frankly. 

    • Like 2
  6. 1 minute ago, dcar00 said:

    We need a ton of testing to be done on the population so we can really see the numbers at the end of this.  we have to be smarter.  I get the shut down foreign air travel/borders, social distancing,  and large gatherings.   maybe there are things we can do to limit numbers on flights, buses, etc without stopping it all together. take into consideration hot zones.   we will have 2 pandemics in 10 years.  We need to use the data and lessons learned on things like ventilators, respirators, to formulate a pandemic response level system.

    Yep on the testing. I’m at the point in time where I would say it’s more important to test everyone in NYC healthy or not- to get a baseline on how many have it, spread, seriousness, accurate hospitalization and death etc. Like door to door free tests for everyone whether they want it or not. 

    I’m the furthest thing from an authoritarian as possible but we need to have huge cross sections of everyone tested to figure this shit out so we can do a rational cost benefit analysis after 2 weeks are up and before deciding what to do during the next wave. 

  7. 1 hour ago, Iceman said:

    Yep

     

    should be amping up for opening fucking day.

    Well- I wonder if I’m going to get my $4,000 for season tickets returned to me or if that’s going to be a bullshit credit for next year. I also wonder if we don’t have a season of our entire OF is gone as free agents. 

    Oh well- at least the sides got along already and will be able to amicably work through all this. 

  8. 1 minute ago, RollLeft said:

    Service contracts.  It's what i tell any and all trades.  Whatever you can do to develop a service division you need to do it.   That means sales and service reps.  Whether it be maintenance contracts on jobs you did or a supplementary service or shared profit from a bundle with a follow up trade is what you need to develop.  Margin at a minimum should be 50% on those things and closer to 65%.             

    Yessir. 

    If you are not doing everything to monetize your data base, at all possible times, by following up with additional products or services they might need while also asking them for testimonials, referrals and introductions you are doing it wrong. 

    • Like 1
  9. 2 minutes ago, dcar00 said:

    Wulaw,  let me help you out here.  Bleach, Borax, Baking Soda(and some Muratic Acid).  I've owned a pool for 20 years.  you should never have to spend more than 100.00 to open a pool.  Do not go to the pool store(except to have the test your water to compare to what you have.

    https://www.troublefreepool.com

    https://www.troublefreepool.com/calc.html

    Buy their test kit also  https://tftestkits.net/test-kits-c4/

    Live it, Love it, Learn it,  you will save 1000's of dollars over the life of a pool

     

     

    Thanks. Going to print it out or save it. I don’t know what I don’t know. I was told to go to the pool store- have them test the water and do whatever they told me 

    then- I lost the instructions, probably got shit out of order- and couldn’t figure out stuff like where my filter was or how to turn off the timer to keep the pool running. This having to go back for seconds while paying my idiot tax. 

  10. 4 minutes ago, Dahobbs said:

    Sigh. Even the non-vulnerable end up in the hospital at a really high rate. Do you honestly think that there are going to be no economic ramifications to an expanded body count and overwhelmed healthcare system?

    None?  Of course not. Way less?  Probably so, economically. We will, I suppose, likely get to see what happens during round two after we poke our heads out again. I can’t imagine this gets handled the same way again- it’s economically ruinous. 

    We have to work hard to find the least bad answer for this. I don’t think we got the balance right during round 1. 

    • Like 3
  11. 12 minutes ago, Pato del Muerto said:

    Looking for that chloroquine tank cleaner huh

    Lol. Never owned a pool before. Bought in December. Took the cover off and looked so cloudy you could hide a bunch of dead bodies in there. Tested the water quality at 20 percent. 

    Spent 300 and worked on the pool for a week and got it to 60%. Wife spent another $200 and worked on the pool for 3 days and it looks perfect. Tomorrow was the day to get water quality tested. Guess that isn’t going to happen. It’s clear, looks clean and smells right and the test at home looks ok- so I guess we are going swimming tomorrow. But won’t ever know if we succeeded at getting to 100% water quality. 

  12. 1 hour ago, Helobious said:

    Lol at “found a way around it”. I read the declaration. I had a very hard time thinking of a job that wasn’t covered under their “exempted businesses” section. The listed virtually every type of business on there.

    2 places I’ve gone in the last 2 weeks (only places I’ve gone other than grocery store). 1/2 price books and Leslie’s pool supply. 

  13. 52 minutes ago, Rusty Shackelford said:


    I can’t pull up the chart rn, but the 10 year bonds went lower from open to close (yields went up) while MBS also went up. Fed stepping in the purchase MBS obviously is detaching mortgage rates from fundamentals.

    Yes- fed is not going to let MBS fail/ crater. They want the housing market as strong as possible to stall of serious damage. If people have jobs that will work. If not... nothing gonna save this. 

    MBS closed at an all time high today- and my pricing was 1/4 worse than it was 2 months ago and 3/4 or so worse than it was 3 weeks ago. 

    Everything Phil posted in his explanation from his flagstar rep is dead on balls accurate. 

    • Like 2
  14. 49 minutes ago, Brisketexan said:

    I'll suggest that as a society, we regularly come to forks in the road when we need to decide who we are.  There are plenty of times we've chosen to be utter shitheels, racist pieces of shit, etc.

    And there are times when we have chosen to be what we claim to be, what we aspire to be.  We are at one hellacious fork in the road.  We have a choice of who we want to be, both during this crisis, and once we are out on the other side.  Some folks have chosen well -- I hope that momentum builds.  Momentum is a helluva thing.

    Momentum doesn’t exist- ask the numbers nerds and Herman. 

    Counterpoint- people don’t change. Your perception might- or the situations they are put in and their incentives for behaving a certain way might- but by and large they don’t change. 

    As to what you are talking about with the decision to do right or wrong that’s universal throughout every culture and the struggle since the dawn of time that’s always been observed. 

    I think the trajectory has been, on balance to get better and there’s some cognitive dissonance in the past 10 years especially brought on by the revolution brought about by social media and our interconnectedness. We will figure it out. 

  15. Just now, Brisketexan said:

    Just as an update, I'm seeing a lot of posts, discussion, etc. of folks doing right by each other.  Neighbors helping out older neighbors, that sort of thing.  And people all over doing their best to lighten the mood, to share some joy and laughs with people however they can -- just being good and decent to each other.  It does the heart good to see it.  It's what we MUST see more of.  It's not just the only way we get to the other side -- it's how we can be the kind of society we want to see on the other side.

    Keep it up, folks.  It's going to be a long haul.  Keep it up.  We have to.

    This is America, more or less. I hope you step away from the ledge some and see that. Even the people you probably think, on some level, are racist, cruel shitheels probably aren’t all that bad most of the time and in most situations. 

    At least that’s what I tell myself because dwelling on anything else is counterproductive 

    • Like 1
  16. 24 minutes ago, Rusty Shackelford said:

    @UTPhil2006 would you give some insight on what mortgage rates did today?

    Not Phil but am a broker... most of my pricing was worse today than yesterday- even with MBS having an Incredibly strong morning. My pricing didn’t get better and might have gotten worse. 

    Yesterday was a really good day for rates but today sucked relative to MBS market. My bet is that a lot of people locked yesterday (I locked 5 people sitting in line for a refinance to hit a certain rate and I moved 3 resales I’d locked Friday somewhere else. So 8 locks for me in the system. Give you a concrete example

    $400 sale- great credit- Friday I locked that at 3.875 with a 175 point yield to me. Monday afternoon I relock at 3.25 and my yield goes up to 187 bips.today- my production partner texts me that MBS are up 90 or 100 points so I go look at that deal to see if I’m moving it again and my pricing is ... 3.375 (worsened) with a yield at 168 bips (worse for me). Well, what sense does that make?  None, if you are just looking at market pricing, but the capacity is stretched thin in the system and there just isn’t much appetite to do any more deals right now for the lenders. 

    Also- the non QM market blew up over the weekend (don’t hear much talk about that), but that’s your jumbos, bank statement loan, bad credit, investment property squirrel deals and other stuff. No liquidity. Poof- those guys don’t exist anymore. 

    Thats what we’d have been looking at in the entire real estate market if fed hadn’t acted as decisively as they did 

    • Like 1
  17. immediate things I’m putting in place:

    1) save/hoard as much cash as possible 

    2) cut any unnecessary expenses related to anything other than the core of “running the business” that makes revenue appear- if it’s not something that directly helps me bring in revenue or is mission critical to my business I’m not doing it 

    3) be quick to cut staff when there’s no revenue to support them. They can be furloughed and brought back later- if this thing gets really bad you can’t carry them throughout the term, and benefits and help from the government should be pretty fast- better for Uncle Sam to carry them than it is you or I as the business owner- it might be the difference between being an ongoing business and not existing in 6 months 

    4) dig in hard core on who your customers are and where the demand comes from and measure the elasticity in demand going forward if we are in a recession/depression conditions 

    5) keep an eye on whatever your exit strategy is and pull the plug before it devours your current personal assets- don’t feed the business “until this is over” if that’s not viable- no shame in going out of business in this environment and you are likely to get the best of what we is coming from government/creditors if you move now with the mass of people and not later. Don’t be overly optimistic about what recovery looks like/ if you were barely making it right now what’s your future business look like with 20% less GDP- don’t be afraid to rip off the bandaid. 

    So far so good for me. I had a huge board built up due to rates falling (mortgage and title business- separate). I was afraid my revenue would drift toward zero if we got a shut down- but looks like we are essential so I’ve got revenue coming in to operate as normal. We will hoard as much cash as possible to tide us over but if we go into recession/depression I will be running as lean as possible. 

    Everything I’m devoted to right now is how to grow revenue- dig in with my past customers and try to take market share from the dipshits in my industry if a recession/depression hits. Will that. E enough?  No idea. 

    Finally/ be honest and transparent with employees. They only have a job as long as revenue comes in so everything they do at all times should be focused on bringing in revenue or mitigating costs. The better you are as an employee in these issues the more secure your job is. Do it humanely and in a positive way- but let them know times are tough and for this to work everyone has to pull on the rope to make it work. 

    Good luck to all. There will always be opportunities presented by the market in any situation. Take advantage of that. 

    • Like 6
  18. 20 minutes ago, Dbeasy said:

     


    And how did you do that exactly? Just tell them verbally? Because if it’s just verbal, they will likely still try to get you to pay for repairs under the hope that you will be afraid of having to start the process over again.

     

    Doesn’t sound like it matters as he’s decided he’s going to renegotiate and cave to anything buyer asks for within reason. Which is the smart play in this market imo. 

  19. I’m shooting blanks after I got neutered but we just got in a little practice like we were trying to have a 4th kid. 4 year old Was sent to me and said mommy wants you- wife told me to lock the door and then she was naked. Weird that this happened with 3 kids awake on the other side of the door but I’m not complaining. 

    That would have never happened last year. 

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