Jason Baird: It sounds like I would be receiving from you guys a lot of consulting and help because you've been down this road before so you know a lot of things about what makes a successful laundry business and all the bits and pieces that goes into that from equipment to location to marketing and all that. I guess one of the things that I would be paying you for would be... I really don't pay you for the consulting. I would be paying you for buying or renting equipment or I would be paying you for an ongoing maintenance contrac?. I'm receiving free consulting but I'm trying to figure out exactly what I would be paying you for.
Ryan Smith: We basically consider the consulting aspect of this into our equipment cost so obviously if we were being compared against another competitor, the experience that we bring to the table is typically what tips the scale in our favor. We're the largest laundry equipment distributor in the south and we've built more stores than anybody. Having that experience, being able to draw on all the different markets that we do business in really gives us an edge, and for consulting, sure there is an absolute cost to it. There is a cost for the time that my team puts into every project and that is typically absorbed on my PNL as a cost of doing business and I don't necessarily have a line item for it but at the same time we recognize that it is usually what tips the scale in our favor when someone is looking or comparing us against one of our competitors.
Jason Baird: I think I forgot one. Maybe training, I may have some people I would have involved in the business that might receive training or is that something else?
Ryan Smith: Typically we offer an annual service school that they can come to our office and learn how to work on the equipment. We bring in some factory reps and some of our senior reps in our company and we train participants on how to repair the equipment, but you are correct. If you were to build a new store, the training is typically done at the beginning, prior to store opening and we offer that training free of charge. It is included once again in our package. Like I said, I don't necessarily put a line item in there. However, ongoing training, we offer a 90 labor warranty and so typically we encourage an owner/operator who is on site who wants to learn how to fix the machines to be around when we're there. If there are any warranty related calls, we will show him how to change a water valve and what a gas valve is and how to unclog a drain valve. Most of the items that are problematic for any piece of equipment in a laundry are going to be supply related, i.e. water valves or gas valves, things that are wear out items. We show the owner/operator and really any of his employees how to change those things so that they can be successful and maximize the owner/operator investment in business.
Jason Baird: That was one other thing that I was thinking before. I guess I'm imagining that I purchase the equipment, I guess there's probably an install/remodeling job that needs to be done, but is that something that you guys handle or is that something that I need to contract out?
Ryan Smith: No, we're a turn key distributor so we would handle the installation for you and any other aspects of the installation and service side. A lot of our owner/operators for build out, build within walls, cutting concrete, those sorts of things will request third party contractors because we're not licensed plumbers, licensed electricians, licensed HVAC technicians, we couldn't do a lot of the work ourselves, but in the past we have served as a liaison, on really every project we serve as a liaison to those different grades.
Jason Baird: Okay. Is there anything else that I haven't thought about or things that you would handle? I guess you said a mouthful when you said that you're a turn key distributor.
Ryan Smith: That's correct and that's really it. We're capable of turn key solutions on every project but as is in any scenario, the more involved I am, there is a cost to that and some tend to go outside particularly if they have a buddy down the street that is a licensed contractor might be able to offer him a deal that I couldn't offer him.
this is part II of an interview with Ryan Smith of http://AAdvantagelaundry.com
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