Just to clarify, a partner does not get a "Salary". Partners get profit distributions which are ultimately reported on their K-1. If a partner is to be paid a specific amount, it is what is referred to and classified as a "Guaranteed Payment" (i.e. it is guaranteed to be paid to the person regardless of the profitability of the partnership). It is also reported as a line item on that partners K-1.

quote:

Originally posted by Black92LX:

quote:

We hired me an "assistant" but I'm terrible at delegating things to him because I don't trust he will do "it" as good as I will.

Then clearly you hired the wrong person.

Not necessarily. Delegating is a skill. Control freaks hate to delegate and often have a hard time at it. (Don’t ask me how I know). Control freaks who can be perfectionists are even worse. (Don’t...:-)

The trick is learning what is really important and has to be just so and what just needs to be done in a workmanlike manner. One of the hardest things for me to learn and say was, “That’s fine. It isn’t how I would have done it, but it is fine.”

quote:

Originally posted by slosig:

quote:

Originally posted by Black92LX:

quote:

We hired me an "assistant" but I'm terrible at delegating things to him because I don't trust he will do "it" as good as I will.

Then clearly you hired the wrong person.

Not necessarily. Delegating is a skill. Control freaks hate to delegate and often have a hard time at it. (Don’t ask me how I know). Control freaks who can be perfectionists are even worse. (Don’t...:-)

The trick is learning what is really important and has to be just so and what just needs to be done in a workmanlike manner. One of the hardest things for me to learn and say was, “That’s fine. It isn’t how I would have done it, but it is fine.”

Agreed.

It's the fault of the person who can't delegate or communicate, not the person waiting patiently to help out.

I read it tha he has trouble delegating to the individual because he does not trust him.

Not that he has trouble delegating as a whole (big difference) and agree with you all if the latter is the case.

When you ask this question on a public forum is the time to call it quits. Running a successful business takes a lot of talent. The fact that several partners have stolen money and a bad employee, tells me that you're not on top of the finances anywhere close to where you need to be. Your best bet is to lease most of the space directly to the tuner for X amount a month and do what you do in a smaller section of the shop. Running a successful business is very difficult and most people simply can't because there are so many aspects you have to be good at. I would recommend after 4 or 5 years to find another job or to go back to where you left, OR find someone who IS GOOD at running a business similar to yours and have them come in and tell you what's wrong with your operation AND listen.

Also, having a shop full of cars doesn't necessarily turn a profit either, if the jobs aren't profitable, and the work isn't getting billed properly. It's really too hard to say how your business will turn out with what you've told us. Perhaps give it a certain amount of time and if it doesn't work then you're out.

quote:

Originally posted by Black92LX:

quote:

We hired me an "assistant" but I'm terrible at delegating things to him because I don't trust he will do "it" as good as I will.

Then clearly you hired the wrong person.

The point of hiring an assistant, is that you are finding someone who can do their tasks BETTER than you. What's the point of finding someone who does the same thing as you? Best case scenario, they do the same tasks as you but just not as well. Worse case scenario, they're better at the same tasks and make you ultimately unnecessary.

I have an assistant. She does not do mini-versions of my job. She does entirely separate tasks that are supporting my role in my organization. In my case, she handles the little details, so I can spend my time on bigger things that impact the business. You ought to find an assistant with skills that differ from yours.

Good advice on different levels so far.

Don't take this the wrong way - I'm sure you are a talented guy - very personable.

But it sounds though like you are in a 'hobby' not a business.

Yes - all businesses have lean times and you must be prepared for those. But if you are heavily invested in this - in terms of sweat, blood, tears and $$$ - but not getting paid - you are getting suckered regardless of how 'nice' everyone seems.

Business is not charity - if there is not a projection to get things turned around ASAP and start putting money in your pocket - I would cut loose PDQ. Would you expect your employees to work for free?

If nothing else - think of the opportunity cost of your lost wages / pay.

You owe it to your family. I know your wife being an attorney gives you some cushion in terms of paying the bills - but you can't keep putting off the inevitable.

What are your options in terms of Plan B or C?

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You need better metrics.

Decision making is all about the quality of the information you are basing your decisions.

I know nothing about your business, but off the top of my head, you should be keeping at least the following as metrics:

1) Number of cars in the shop each day.

2) Project duration for each vehicle (days vehicle is in the shop).

3) Dollar value of each vehicle project.

4) Shop hours per vehicle.

5) Number of interactions with each vehicle per day (higher number indicates higher complexity).

6) Number of interactions with client.

7) Number of office hours per vehicle.

8) Number of interactions with vendors per day.

Etc, and so on.

I do better making decisions like this by putting everything down on paper.

What is your agreement with other owner/investors?

Do you have a business plan that lays out how you will eventually make money?

Who gets paid back first if it does, you or the investor?

Do you have the books and are they easy to analyze so you can see where the money comes from and where it goes? Seeing the actual numbers often produces surprises for me. Which services or products are making a profit and the same type of analysis with expenses.

The economy is going ok now so if you can't make a profit now something else is wrong.

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Originally posted by cmr076:

Thanks Mike! I'm going to read over this a few more times to make sure I understand and absorb it all. I think the issue here (one of them) is that I am doing too much and not able to do any one thing 100%.. Taxes, sales, customer service, social media, parts ordering, making appointments. We hired me an "assistant" but I'm terrible at delegating things to him because I don't trust he will do "it" as good as I will.

But thats what managers have to do: delegate. If you don’t trust him, find someone you do.
Very best of luck.

The biggest problem I see here is that you aren't getting paid. Lot's a great info and suggestions here.

You can't/shouldn't work for free, especially if you have unique skills that are bringing in revenue.

All of this should be documented in legal agreements.

It's really hard but my experience in business has taught me to avoid partnerships if at all possible. I refuse to enter a partnership unless I am in control, and my partner has a skill set I can't do without.

Over the last 35 years of observation I have noticed that there are very few partnerships that don't end up with one of the partners getting thoroughly reamed.

I've read a lot of this thread, and have some ideas. I am a corporate lawyer who has been advising startups since 1996, and I have extensive experience as both a founder of startups and a counselor to them.

It's way to much to write, but if you want to have a call, hit me at my forum email address and we can talk. Multiple times if necessary.

I can't give you legal advice in an informal way on this, but I can help you organize the issues you need to decide on to find your way from here.

A

I frankly think your lack of a business education has hurt you. You seem naive and in denial as well.
Professionals hire other professionals. You seem to have skipped planning with an accountant and a lawyer. When what you're doing hasn't worked, STOP DOING IT.

My suggestions:

Apologize to your wife for procrastinating

Take up ArtieS on his offer.

You have just been through a learning process, so no matter what that experience is valuable.

If you are thinking of quitting, you could tell the other partners that you need some regular cash or you have to bail. This has much better options than just quitting.

ArtieS sounds like a great resource.

But for the next time, I'm not understanding why you are a partner but have no agreement. How much of the business do you own? (I don't need to know, it's for you to know.) I also don't understand why you haven't been getting a pay check. Business owners are able to collect a paycheck for holding a position.

I wouldn't bail without getting any equity or money. Good luck, man.

thank you all for taking the time to weigh in, it truly means a lot to me. The $ partner will let me walk away from my % ownership on good terms, so that's a plus. It looks like I know I need to leave, and an interesting opportunity just popped up that I am going to start a new thread on.

quote:

Originally posted by JALLEN:
Before you pull the plug, why isn’t the business making money?

Are you doing adequate volume? Pricing correctly? Overhead out of control?

Given your costs and pricing, can you make money in any reasonable scenario? What is the part that is out of bounds?

I have never forgotten a client I had years ago who came to me about the donut shop he was operating. He was doing a great business, but losing money.

Doing the analysis showed that with the lease and his other expenses, the more donuts he sold, the more he lost. The percentage lease over a certain volume was a killer, for his margins.

^^^^ THIS ^^^

If this is what you truly enjoy and all of the environment (sans the non-profitability) then figure out why (if you can) the lack of success.
If it is purely a financial move (the latest business/job) and no other passion or ties then go do what keeps you solvent.
The old saying "If you love your work > then you'll never job/work a day in your life" is true.
Don't give up if it is truly what you want to do.
Good Luck.

As far as delegating responsibility goes, I've learned this:

Only do the stuff "only you" can do. Everything else needs to be done by your staff with your oversight, not by you. The stuff you must do personally can't exceed the time available plus the time required to manage others.

The trick is to know who can do what & let 'em be to do it. If you don't have the right people for that, there's your trouble.