Hello John:
I am truly sorry to hear about the plight of your friend. I admire your
desire to help. However that being said one should always ask oneself a few
questions before embarking on any venture:
1 - Is there a need for my product?
2 - What will define success for this venture?
3 - If successful, what will be the return?
4 - What will be the lost opportunity cost of this venture? (If we are doing
this we aren't doing something else)
5 - Is the return - the opp. cost sufficient justification to do the
venture?
I have to do this sort of analysis all the time for new technical
developments at our firm. I can't begin to tell you how many fascinating
projects I have had to shelve because of it. Truly heartbreaking seeing
people offer stuff we could have had on the market 2 years ahead of them
except for question 4. I have engineers who I believe truly hate me for some
of these decisions.
I analyse any business or opportunity using a simple concept. Call it "money
density" if you will. The idea of renting an expensive storefront for
example. If you fill the shelves with big bags of popcorn at $1 per bag, the
total possible return of selling every bag of popcorn might barely pay the
rent on the store. Even if it did, one must still subtract the lost salary
that could have been earned elsewhere. Not a winning situation. That's why
fancy shops in expensive areas carry only designer clothes, electronics and
jewelry. Money density is a key to analysing any business.
The car rental business is one built on tight margins, careful cost control,
many many communications and above all volume. One man, one car, one
telephone is not really a recipe for success.
The problem with renting the LBC out is that, as you intimated yourself,
maintaining the machine and finding business for it will cost more than you
can reasonably expect to charge for its rent. I believe that you are on a
better track to helping your friend when you arrange to pass work his way.
Now, that being said, here is the only way I can see to really combine the
idea of helping your friend and saving the LBC:
In retailing the idea of the "loss leader" is to offer as a bonus something
that will return more in general business activity than the specific cost of
the giveaway.
Get this car. Have it become a courtesy vehicle given to customers with a
specific level of work being performed on their machines. A half-day job
with all fluids and tune-up with plugs and points replaced for example.
Build your friend up as a small business doing those repairs. "When you
bring your LBC to me you don't have to stop driving one". People will bring
in their car for a tune-up or whatever if they also get to try out a
different antique for a half day or so. It's attractive, sounds
business-like and could help bring in the customers that are needed. That
way the cost of the machine is offset by general rise in activity. It may be
the cheapest form of effective advertising to start a home business. The
type of vehicle you desribe is ideal to this purpose. Some garages tried it
with fancy cars, but an untried driver driving a Porche while their civic
was being repaired didn't work out. Not hard to see why.
The home business idea may seem a bit strange, but I must say that if the
best way he can earn a bit on the side is the LBC repair work, then this may
be the way to make it go. Otherwise, I believe that mixing business with
pleasure is the best recipe for ending up with neither one.
Best of luck,
Mark Hooper
-----Original Message-----
From: John Macartney [mailto:jonmac@ndirect.co.uk]
Sent: Tuesday, February 12, 2002 4:28 PM
To: Triumph List
Subject: Preservation vis a vis financial common-sense - longish
Fact: Put an enthusiast in front of a car that's for sale and emotion
puts elementary common-sense in jeopardy
I'm faced with a dilemma and the common-sense is in serious risk of
going out of the window.
Two days ago, I was offered a 1974 2000 saloon, manual/overdrive in
Green Mallard and the paperwork with it suggests the 80k miles on te
odometer is genuine. Car's in very good all round condition, well
worth preserving and, longer term, spending some money on to ensure it
stays that way. Unlikely it will ever APpreciate in value.
I'm sorely tempted to buy it - but with a Fergie and now a fully
operational and road legal 2.5PI, it's hard to justify a further funds
outflow. I'd also ave something of a storage problem in the winter.
However, it's clear from posts appearing on this and other lists in
the spring, summer and autumn that enthusiasts visit the UK and
enquire on the availability of classic hire cars. This is what is in
my mind - though not, I stress for personal gain.
Enter third element of the equation.
A few weeks ago, I came across a former Triumph employee who was a
good friend and who definitely has a sad cross to bear. Arthur (not
his real name) used to work in the Coventry Service Dept and loves
messing with Triumphs, though he's been retired for about 10 years. In
the last year, his son died of cancer in April 2001, his daughter died
in August from leukaemia and his wife of a heart attack just before
Christmas. Arthur is now the legal custodian of his four grandchildren
because he refuses to see them going into care. Looking after 4 kids
with an age range of 8 to 14 when you're nearly seventy is a challenge
most would abhor - but not Arthur. That said, his pension planning has
been blown wide apart and he desperately needs extra money. I'm
helping him in finding work on our cars that he can do for enthusiasts
in his garage - but I'd like to do more.
If I did buy this car, I'd plan to offer it at an attractive daily
rate (for the user) and use ALL the proceeds to let Arthur
progressively turn it into a thoroughly agreeable 2000. It's not far
off that now! I don't want any profit out of it at all and as it will
never appreciate in value on the shorter term, I wouldn't be able to
profit from its later sale. All I'd want to recover is my outlay - no
more.
Bottom line is I'm willing to gamble about $1000 to buy the car if I
can satisfy myself there's a hire opportunity that people would like
to use and who are prepared to put heads above parapets.
Some may query "why a 2000 and not a Spitfire, TR or Vitesse?"
No other reason than that even good 2000's by UK standards are cheap,
they will seat four people in comfort and the boot is massive for the
luggage that SWMBO might bring if only two wanted to use the car.
The collective *common-sense thoughts* of this list would be of
considerable interest. I think I already know the majority response
but I'd like to save this car, try to help Arthur and find a way
whereby Triumph enthusiasts could use a Triumph on a UK visit.
Have I lost all my marbles?
Jonmac
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