Diary of a Used Machinery Dealer

6:00 AM – Wake up and pick up the iPad next to my bed to check email from Europe and Asia. Nothing interesting except some Tornos cam machines in Lithuania.

6:30 – Turn on CNBC to check out the world markets. Talking heads are bemoaning Greece on the verge of default and the awful economy. Joe Kernin and Rick Santelli are hopelessly pessimistic and angry at Obama. Why am I watching this crap? Turn on Sports Center.

7:00 – Hit the treadmill. I turn CNBC on the TV and watch while on the treadmill. Listen to more dumb economists and self-serving politicians. Am I on the treadmill or are the TV idiots? Yes, we both are.

8:00 – Risa is slowly waking up to NPR. I lift the blinds and tell her I’m good, which is absolutely true because I am alive and I got to work out for an hour in my own home.

8:30 – Wash up. Shower, prayer and meditation. This is the luxury of owning a business. I have adjusted my hours to fit my physical and emotional needs.

9:00 – My wife Risa and I have breakfast. We both have our iPads at the table looking for relevant email. We briefly discuss our schedules and dinner plans. She is working until 8 p.m., so I will cook. She will buy fresh salmon.

9:30 – Drive to work. Run through the drive-through at Dunkin Donuts for a large coffee with milk, one Splenda. Talk to brother and business partner Jim on the cell phone from the car.

10:00 – Business meeting to discuss what’s hot with Rex, Noah and Jim. Three deals are on the front burner—two sales and one buy. Jim feels if we cut the price on a Wickman we may be able to close a deal. Noah asks why the client will not buy at the asking price. Rex says he thinks we cannot push them. We decide to be patient, but that feels uncomfortable. The urge is to do something. Jim volunteers to travel to Ohio to look at some Acmes and Rex and Noah make plans to travel to Wisconsin to look at some CNC lathes and talk to an old customer who may be buying a screw machine soon.

10:30 – I study email, mostly Surplus Record and MachineTools.com, looking at the “Want Ads” and “For Sales.” This instantaneous bulletin board is fascinating because it tells you what is hot that day. It seems like everybody is looking for VF-2 and VF-3 Haas vertical machining centers and Mori SL-25 lathes, 2000 or newer. Nobody is looking for Acmes, Wickmans or Hydromats today, which is the norm. When you carve out a tiny fragment of the market you give up velocity and action for esoteric knowledge and theoretically better margins.

11:00 – Pick up on the PMPA (Precision Machined Products Association) List Serve. One thread is about parts cleaning issues, another is about looking for somebody to do 5000 pieces on Swiss CNC. Nothing controversial today. I check the activity on my blog. Six comments and a personal note relating to the previous day’s blog sent to 40,000 potential readers.

11:30 – I reluctantly lift off my seat and walk into the factory to see what progress has been made on the machines that are sold. Greg, our top rebuilder is cleaning disassembled parts of a Wickman. Why is a skilled person laboriously cleaning parts by hand? We’ve put a sandblaster at his workplace and a wash station, but he still spends too many hours doing this dumb work. We could hire a guy to help him clean, but it’s hard to justify the extra salary. Our electrician, John, is rewiring a Wickman—more slow work. The machine has an outdated control that might work, but a client pays us well to provide a machine that will always work (hopefully), so he painstakingly troubleshoots the electrical panel.

12:00 – Our banker struggles to understand our business after many years with him. Are we a distribution business, a manufacturing business, a maintenance business—or a floating crap game (dealing in crap)? Probably a cross between all of the above. Unfortunately, bank regulators are bureaucratically ignorant and want everything to fit into a neat category. Graff-Pinkert does not. I consider myself a speculator in 30-50 year old iron, an alchemist who turns other people’s trash into gold. Noah says he is a “treasure hunter” when he is asked by a girl in a bar what he does. To lay people I am a writer and a businessman, and they can fill in the blanks. I think our accountants are clueless about what we do. If they read this maybe they will start to get it—if they want to.

12:30 PM – Noah proposes that we get some “grub.” I am eating raw veggies and hummus for lunch. I propose we go over to the Forest Preserve lagoon five minutes away and eat lunch overlooking the water. He picks up a sandwich from the strip mall across the street and we drive to the lagoon. We talk business, dissecting various deal options, then movies, sports, politics, life. I am renewed by his presence and inquiring mind. Jim calls on my cell. Noah says to let it ring, but I feel compelled to answer. Maybe he was right.

1:30 – Check email again. Is the computer a valuable tool or a time waster? Still a little hungry. Ignore it. Drink water. The phone isn’t ringing today. Maybe the gloom and doomers are right, but I cannot afford to buy into pessimism. I must stay upbeat even if I’m faking it because if I’m down everybody in the office will feed off of it. I make some cold calls. If the mountain doesn’t come to Mohammed, Mohammed goes to the mountain. A bunch of voicemail. Doesn’t anybody answer the phone? Then I answer the ringing phone. It’s a parts call, but I take the opportunity to query the caller about his business.

3:00 – Our part-time receptionist/secretary, Luci, answers the phone and it’s a real live client whose name I recognize and he actually asks for me. I’ve tried to reach this guy for months to no avail and now he’s actually calling me. Noah wants to listen so he picks up too. The customer tells me he’s literally been putting out fires for two months after a July 4th 3:30 a.m. fire that messed up his plant. He wants to come in to look at Wickmans in a couple days. Will I be there? Are you kidding me? Customers are gold, especially one who has bought repeatedly in the past. I do tell him that prices have firmed since he bought last at the bottom of the market in 2009. At that point it didn’t matter what price you sold for—you just needed cash. Today I expect to make a decent profit. He didn’t flinch. When you are selling multi-spindle screw machines you have a tiny market, but you also don’t have a million competitors like you could selling Haas VF-2’s.

4:30 – Jim has left. Noah, Rex and I are talking shop. They want to understand how liquid we are if deals come up. I regard Rex as a partner, even though he has no financial ownership, and Noah wants to understand as much as he can absorb. I explain our financial position—how we are constantly balancing cash flow needs and the desire to hold out for a decent profit. This is the hardest part of the business. If you don’t gamble on machinery you work for peanuts. If you gamble big and lose, you go broke. Where is the value? One day I walk into the plant and machines look like they are made of gold. Other days it’s one big pile of junk.

5:00 – Rex leaves. Noah and I talk about Today’s Machining World. He has been working on a new Web site design. He shows it to me and I love it. Then we discuss blog ideas. He has a dance lesson, he’s huge into salsa. I head home to chill out a little and make a healthy dinner. I get home, read more email and talk to Jim about a deal in Europe. Then I play a word in “Words with Friends” on the iPad with my son Ari and check the newsfeed on Facebook—my daughter-in-law’s excited about cooking tonight. I’m happy. I make a snack for Risa and her student and put the sweet potatoes in the oven.

8:15 – Risa and I eat dinner. We share our days. I wish I could explain what really happened today. I didn’t sell anything. I didn’t buy anything. Hopefully I moved the ball. I taught Noah. I was a machinery dealer today. I had fun. I should have laughed more. Does she really get it after 40 years? Probably not, but who really does really get such a weird profession?

Question: What is the most important part of your day?

Lloyd Graff writing at his desk at Graff-Pinkert & Co. in Oak Forest. Ill.

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12 thoughts on “Diary of a Used Machinery Dealer

  1. AvatarEd Gnifkowski

    Howdy Lloyd.
    When I bought used machines in the old days i generally didn’t squable about the asking price. To make the deal your dad/uncle or any other dealer had to meet my request to pile on the accessories and parts. We saved tons of down line costs that way.
    Have a great weekend.

     
  2. AvatarRisa

    Lloyd, I love the way you’ve described your day in “Diary of a Used Machinery Dealer,” and I really do get it! May there be many, many more days of IPads and alchemy.

     
  3. AvatarJoe C

    “Most important part of your day” That would be the 8:15PM appointment. All the other stuff just has to happen to get through another day of this very strange market and placement of business. Not only your but all of it today. Spending time with the ones that have been there with you through it and do understand, but in there own way. Hope you have many more of the late night appointments and continue to make the world turn.

     
  4. AvatarEric

    Great and inspiring article! Thanks for kicking my motivation into gear. Yes, Waking up and seeing the sunrise is the best way to start the day!

     
  5. AvatarPeter Frow

    Thanks for this blog Lloyd – loved it – your transparency and frankness are a tonic.
    Perhaps such a diary (or bound to be different diary) could be a regular feature.

     

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