Between a Rock and a Soft Space

CPR: Confidence, Patience, Respect

After 63 years of looking at my best days and my worst days, and looking at where I felt I was successful and where I was a bit behind the ball, I could be very sure that if I used all three, my win column was huge. If not, my losses, as I accepted them as mine, could be identified as to why.

Confidence was usually not the problem. That came early and grew steadily. Respect with respect to others was also a trait that, because of my parents, I was fairly consistent with, and very seldom was I disrespectful with anyone unless it was a moment where they were disrespectful to my employees, or total miscommunication was at hand.

So, always looking toward the next adventure or accomplishments, impatience was usually the culprit that I may decide right away, or sometimes years later, as the reason I had to take the loss.

The Railroad Ties Lesson

Once, I was offered a large quantity of railroad ties that were being removed by a licensed railroad construction team. As I showed up on my retail property, there were many bundles of ties—literally hundreds of them.

As a landscaping company in the late 90s, the RR ties were no longer used as they once were years ago for retaining walls. Prefab concrete blocks had replaced the ties for many reasons; however, ties were still used occasionally, so the price of “Free” was enticing. As I surveyed the bundles, it looked like they were in pretty decent shape, and the salesman only needed my signature to close the deal. They assured me they would normally take them, but since their company was hundreds of miles north of Evansville, they were willing to just give them to me, thus not having to haul them a long way. Wow! What a gift, I thought. But you know the old adage: if it sounds too good to be true…

And it was. Months later, when we finally decided to use them to make beds for some of our nursery stock and we finally cut the metal straps that held them together, we quickly realized all the ties on the inside of the bundles (approximately half of each bundle) were ones that were in very poor shape. And many of the bundles we opened showed the same decay. They obviously knew what they were doing, and luckily for us, we did not lose any money, but we could not use many of them for a customer’s needs. They were good enough to use for nursery needs but not for retail.

So eventually we buried some of them in a big hole.

So had I been a little more patient and inspected the internal bundles while he was there, I would have saved us some labor and embarrassment, as we could only laugh eventually at how we had been a bit hoodwinked.

The 1000 Tons of Stone

But a much better example was the time I had the opportunity to purchase over a thousand tons of natural stone I saw on a highway project near my business. As Schroeder’s Landscape and Aquatic Nursery was growing at a very comfortable pace, natural stone was being used in many of our projects. I was driving near my old college campus when I saw a local construction crew unearthing large quantities of natural sandstone that was part of a huge vein of natural stone called the West Franklin vein. This vein of billions of tons of stone ran from Southern Illinois and Southern Indiana, part of which also ran across my property that I unearthed years later (read, “A Mammoth Cemetery”).

So as usual, the next thing I knew, I was talking with the project manager in charge of this highway construction and asking what he was going to do with all these large boulders they had laying around. As luck would have it, because I’m never afraid of asking a simple question, a couple weeks later I was receiving on my retail property and personal property over a thousand tons of these irregularly shaped boulders for the low, low price of just $10,000. The stones themselves were free, but to deliver 1000 tons was costing me $10 per ton—so much better than the $130 per ton plus shipping we were charged from a number of wholesale companies where we were currently buying from.

Imagine approximately 43 large loads of stone piled up in an area over an acre in size, in two locations.

A Profitable Opportunity

You see, a large part of our landscaping business was hardscapes: natural stone walls, outcroppings in landscape gardens, large water gardens and waterfalls or streams into lakes. This was my most profitable buying accomplishment of my life. We could sell this stone for around $250-$275 per ton, then install it for another $275-300. So quick, easy math said that for $10,000, we now had the materials for about a half a million dollars worth of work. Yes, these numbers are not net numbers, as you are well aware. But as a company who had purchased tens of thousands of tons of stone over 30 years in the business, this was such a rare find. And we were all feeling a little giddy at the success of this purchase because, yes, my company knew that bonuses were handed out each Christmas season based on net profits, and the occasional deep-sea fishing trip or company morale booster meant that this huge event was definitely going to pay dividends.

Not long after, we secured a fairly large retaining wall job for a local doctor. They needed support for a failing wooden wall that was part of a pool construction. These new large stones were perfect since the mass and size worked well for a wall approximately 70 ft long and approximately 7-8 ft high. So our gross profit margins were much better with this inexpensive product. And the realization that we had such a large quantity of these stones greatly enhanced our bidding process for years to come.

It was like a dream come true, and it also enlarged our stone yard vision as a key player in the natural stone business. That is until…

The Unfortunate Discovery

One day in the early fall, I had asked a gentleman who had a large excavator with a hydraulic jack hammer to come to the nursery to make some of the larger stones (approximately 2-3 tons in size) smaller so we could use these sizes for smaller outcropping stones. Different jobs called for different sizes, and with such large quantities of this newfound gold, so to speak, we wanted to be able to offer some of these to our retail customers who would not be able to handle these gargantuan sizes. But if we could make them just a couple hundred pounds, we could load them into their pickup trucks, creating a market that now had a wider range.

Expecting this hammering to go on for several days, Danny came in about 6 hours later to inform me that it went much faster than expected.

“Seriously, how in the world did you get these hammered so quickly?” I asked.

Granted, he had not done all 1000 tons, for we still needed some large ones for our bigger jobs, but it was then he informed me that he felt that these stones were not nearly as hard or dense as the majority of the stones we were used to using.

As I went out to survey the new yard of smaller stones, I was able to identify that this stone had more of a granular look once you could see the insides—meaning only after you could see the grain of the stone and you could see how easy they were to separate. An unfortunate thought raced through my mind: “As hard as a rock” had a variety of meanings when I now realized that my many tons of stone were not what I had hoped for.

A Question of Integrity

For me to sell these as retaining wall stones, knowing that they may not hold their integrity like the many other types of stone I had sold in the past, I now needed to process what exactly this meant.

If I was going to be a man of integrity, knowing that much of this stone could be sold at $275 or more per ton, I knew that in years to come, some of this stone could begin to separate, which could create displeasure for my customers. You see, I had a saying in my company that my plants had a 1-year warranty; our hard-scaled jobs, I did not expect for them to truly appreciate the finished product for ten years. In other words, “Yes, I know you like it now, but let’s see if you still like it 10 years from now.” This was my measure for our quality. My koi may only have a 2-week warranty depending on the expertise of the new owner. But my stone? Yes, my stone I would promise would not die for 1000 years. And if it did, my future generations of my family would replace it TIC (tongue in cheek). Or, my stone was so hard it would not break.

But now I knew something that no one else did. These stones were not the solid stones I believed they were. Thus, I now had to cancel any jobs we had bid to use, and I instructed my retail staff to not sell to anyone without letting them know these stones may change in 100 years.

The Outcome

The next couple days I found myself looking at the doctor’s wall we had constructed, and for many years later, I would return to this wall and incredibly these stones kept their shape and stayed true. However, as I began using these stones around my property, either constructing paintball courses or lining them around my lake’s edge, it unfortunately became apparent that I could not sell these for anything more than rip rap or fill-in types of jobs. And thankfully this was discovered early before we had constructed many jobs which later could have failed, at which point we would have had to buy better stone at a much higher price, and the labor to take these jobs down and then rebuild them could have been disastrous.

But we did not lose money on this purchase, but our goal of making a half a million was instead more like $100,000.

Moral of the Stone Cold Story

Had I been more patient and had these stones checked while still on the highway, we would have not had to worry about what could have been. Also, I often wonder if the construction crew noticed this stone was not high-quality stone and this is why I received them at a great rate. Never did ask them that question. But still today, as they line my lake and I use them to keep myself in shape by bouldering through them many mornings, it is a great reminder that CPR is so critical for success, and a lack of patience will give you a lake with 45 stones that today has a count of 300. But miraculously, to this day, why the wall for the doctor stayed intact is still one for the books.

Patience is one of our greatest challenges when we have a dream and we want it right away. Or we have found a great asset like a friend or business opportunity, but our impatience makes this asset unable to meet our timetable.

And remember, if you are going to give someone a 1000-year warranty on something, you better hope your future generations have the integrity to back you up or your name may be mud in 3033. Ouch.

John M Schroeder