Chapter 13. Sex for Resources

What follows is a continuation of a series of articles comprising a book entitled “Passion, Power, and Panties–Confessions of a Businessman” wherein the author describes being raised as a Jehovah’s Witness, spending almost ten years at their headquarters in Brooklyn, NY and then entering the ”outside”  world at the age of 27.  For purposes of continuity, I encourage you to subscribe in the column to the right so as not to miss a post.  It is free and without obligation

In time we exhausted, and dominated the market in our part of the state, and I decided to enter the market of a major metropolitan area about 170 miles away.  

I spent about six months doing market research on the cheap, which meant asking what local fast food restaurants were paying their help in order to get a frame of reference what the current wage rates were in this new city.  At the time most fast food restaurants were paying $3.45 per hour, so I based my quotations on that wage rate.  What I did not know, was that at the time, there were over ten million square feet of new office space under construction in this city.  When all that office space was completed and was occupied, there was going to be a major surge in the demand for new housekeepers.  With the supply of labor more or less fixed, and the demand for cleaners surging, the result was quite predictable:  a surge in the price of labor.  Which meant that all those new contracts I had just sold in this city were going to lose money, because we were going to be unable to staff the buildings at the wage rates we had quoted, and if we raised the wages, we could not raise the prices, and so were going to take a serious financial hit.

 We tried to hold the line on our wages at the level we had quoted the new business at:  remember we were in the cleaning business, and labor is by far the largest cost of doing business.  As we tried to hold our wages at the levels we had quoted the business at, the competition for labor was intensifying in the city, and our competitors were slowly offering more money.  And so were the fast food restaurants, and every other enterprise that operates with entry-level labor.  I would often pass the same Wendy’s unit on my way to work, and they constantly had Help Wanted signs in the window, and I noticed that the offered rate of pay went up about $.25 per hour every two months or so.  The significance of this had not quite seeped into my consciousness, but I woke up at a trade show in St. Louis later that same year.  I was talking over cocktails with one of my Jewish competitors from back in my home state, and he said about one 22-story office building we cleaned:  “My cousins run that building.  Don’t you think I’d have that contract if I wanted it?  Why do you think I don’t have it?  Because I don’t want it, because I can’t make any money at it.” 

Read more..

Chapter 11. “How Much Justice Can You Afford Today?”

What follows is a continuation of a series of articles comprising a book entitled “Passion, Power, and Panties–Confessions of a Businessman” wherein the author describes being raised as a Jehovah’s Witness, spending almost ten years at their headquarters in Brooklyn, NY and then entering the ”outside”  world at the age of 27.  For purposes of continuity, I encourage you to subscribe in the column to the right so as not to miss a post.  It is free and without obligation.

Some of my most painful business lessons came from the legal system.  I was unaware that a large group of under-employed attorneys had invented a brand new field of litigation that came to be known as contract employment versus employment-at-will.  The theory apparently went something like this:  if an employer said something to an employee that could even vaguely be construed as an assurance of continued employment, it could be considered a binding verbal contract.  Let’s say, one day during a discussion with an employee that you, as the employer say something intended to show appreciation and encouragement for recent good work on their part such as “Keep up the good work.  You have a real future here”, and then let’s say that a few months later their attitude changes and their work goes south and you end up terminating their employment; they could now sue you for termination without just cause, because implied in your encouraging verbal statement months before was a guarantee of some sort of continued employement.  From that point on, in the eyes of the law, you could only discharge an employee for “just cause”.  Well , how hard can that be?  Who would want to terminate someone for an unjust cause?  The problem is, “for just cause” in the eyes of whom?  Of course it was appropriate in your mind to discharge them; you were probably fed up with their behavior, or taking a lot of grief from them and spending 80% of your time trying to correct them and taking heat from both your boss and the customer to get the situation fixed.  But the problem is, their discharge is never  for “just cause” in their own eyes.  When was the last time you heard someone say, ‘I got fired today, and by God, I deserved it.’  So now, under this concept of implied employment contract, this discharged employee can challenge his discharge in court, and you are obliged to defend your decision to let him go.  To a jury.  What if you get a jury that buys into the Hollywood stereotype that businessmen are greedy and corrupt and out to get the little guy?  You may successfully defend yourself, but it’s going to cost you money, probably a lot of it, and the plaintiff’s attorney knows that.  So he launches a paper battle that runs up the bill for the defense.  At some point the insurance company will capitulate and pay off, just to contain their spiraling legal costs.

Read more..

Chapter 10. Save the World, or Save Myself?

What follows is a continuation of a series of articles comprising a book entitled “Passion, Power, and Panties–Confessions of a Businessman” wherein the author describes being raised as a Jehovah’s Witness, spending almost ten years at their headquarters in Brooklyn, NY and then entering the ”outside”  world at the age of 27.  For purposes of continuity, I encourage you to subscribe in the column to the right so as not to miss a post.  It is free and without obligation.

My $90/month corporate office 1981

I apologize to my readers, for I have gotten ahead of myself in this story.  Picking up where I was at the beginning of Chapter 9, I had twelve part-time people working for me, and I was taking $800 per month out of the business to live on.  I had this dinky little office in the basement of a building near the apartment where Barbara, I, and our first daughter Meghan lived.  The office was about the size of a closet, one room, and there was this deep ditch outside the basement door to the building, with a wooden plank thrown across it as an entrance.  I paid $90 per month for this.  There was a large standpipe from the floors above that went right past my desk, and whenever anyone upstairs flushed a toilet, you could hear it whistling right past my desk on the way down into the sewer.  I had an old metal battleship desk I had bought from a customer for $25.  I was drowning in problems and had no idea where to turn to for help.  And I couldn’t think of whatever else I could do if this failed.  It was not uncommon at all for me to work 24 or even 36 hours straight before collapsing in bed.  I did not consider myself a businessman at all; I felt totally incompetent and foolish.  What kept me going was desperation and fear of failure.  Barbara and my combined, adjusted gross income that first year was $5600.  We were below Appalachian poverty level.  I’m sure we qualified for all kinds of government Welfare, but we didn’t even know it existed and it never occurred to us to ask.  It never occurred to us that we were anyone’s responsibility but ourselves.

I went to the town library and looked up trade journals and sent in a card to one of them.  I started getting junk mail, and eventually I saw an advertisement for a trade association convention to be held in Orlando, Florida.  I figured out what it was going to cost for Barbara and I to go down there, and it was about $600.  I don’t remember where we got the money from, but we went.  I was shocked.  I expected to meet a whole bunch of miserable sods like myself trying to stay alive, and there were some.  But I also met many very successful operators, some of them multi-national,  with literally tens of thousands of employees each. 

  Read more..