A towing business.
It may seem like another thing to dilute my time & attention.
And maybe it is.
But I’ve got a huge upside with almost no downside
Heads I win big, tails I don’t lose much.
Best case scenario: we go from 0 to 30 trucks doing $6.0M in revenue and $1.5M in profit.
Every broken car will need to get fixed….at a repair shop.
Ideally, we’d get many of those into one of our 34 shops.
That’s about 40,000 service calls. I’d hope we could get 4,000 vehicles into our shops (1 out of 10).
With an average ticket of $600, that’s $2.4M of revenue for my Midas business.
Since it’s all incremental, our contribution profit on those sales will be very high since all our fixed costs are already covered. That should add $1M of profit.
We’ve got a path to $2.5M/year additional profit between towing & repairs.
The medium case is the towing business is half the size: 15 trucks doing $3M in revenue, and margins are lower — it nets $500k.
We can only get in 1 out of every 20 cars, bringing only 1,000 cars to Midas, generating $600k in revenue.
The two businesses are making an additional $775k/year.
The worst case is we hate the business. It’s riddled with problems, and it’s not worth it.
We sell the trucks and break even or lose a little money.
Heads I win big, tails I don’t lose much.
I’ve made a promise to myself to play a bigger game.
I’m only going to make bets with the potential for huge payoffs.
Building a massive towing business won’t be easy, but the plan is simple:
Generate leads → Buy more trucks → Hire more drivers → Follow the process.
What do you think? Am I crazy, or does it sound like a great plan?
Cheers!
Brian
