What’s Hip Hapnin?

When I was in college one of the required courses for the business major was an executive lecture series. For most people this class was an easy “A” all you had to do was show up. Because I always worked full time while going to school showing up wasn’t very easy for me so I had to take the class 3 times. I don’t regret it though I heard some amazing speeches. One speech that was surprisingly good was from David Burbidge.

David Burbidge was a garbage man, he started in college with one garbage truck and over the next 25 years built it into the largest garbage collection company in Utah. In 1997 he sold out and made tons of money and now is a consistent doner to the Mitt Romney Campaign.

The main thing that I remember from his speech is he said the turning point for his business. The moment he started making so much money he didn’t know what else to do but give it away. Was when he purchased a garbage truck scale that could weight the dumpster you were picking up. You see the problem in the garbage collection business is that you charge your customer based on how frequently you dump the garbage. But you pay to empty your truck based on the weight of the garbage. If you pick up a dumpster of feathers you make money if you pick up a dumpster of rocks you lose money. He took that truck with the scale on it to every account and figured out what his average cost was to dump their garbage. What he found out was that there were some accounts he would lose money on every time. He would refer those accounts to his competitors. It wasn’t about market share it was about profit. From that point on he would only work on the most profitable accounts and let his competitors take the rest.

So what is the moral of the story? When was the last time you weighed your garbage? We all have clients that suck up our time, energy, and resources. Let your competitors have those bad clients and move on. It takes courage to give away money, be brave.

The client I was talking about in the previous post should have been dropped before they dropped us. We talked about it…they were abusive, unappreciative, proud…we weighed our garbage and knew we should get rid of them but in the end didn’t have the courage.

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