Simon Gare tell’s all on his experience in a cesspit of an unregulated ‘cash’ industry full of deceit, thieves, liars, back stabbing individuals and regular violent threats directed at his staff, his children and himself!
My name is Simon Gare and in 2012 I launched a man and van business using my 26 years expertise in ground transportation, primarily taxi and private hire. I decided to share my 4 year experience in the removals sector which I am sure would have broken most people. Fortunately my long suffering wife has stood by me but during this time she has endured constant disappointments and forced to move 4 times in 3 years, none of which we had any other option but to move. I have decided to pull out of service delivery completely to focus on a technological solution for ground transport that I have been working on for the last 15 years and to consult to removals businesses using my vast ground transport experience.
Before launching I looked at the removals sector as a taxi operation and not as a removals business, this allowed us to expand rapidly not focusing on scheduling but instead delivering the service as and when the client wanted. After just 90 days we were the largest man van operator in London and the Home Counties, actually I am pretty the whole of the UK. So successful was this business logic we launched our service in Birmingham in 2013. My primary focus was to turn an antiquated, unregulated, cash business into a professional one, a business model similar to Addison Lee with hopefully the backing of Transport for London TPH (taxi and private hire) to regulate it same as they did for the private hire industry over a decade ago.
We opened a dedicated contact centre in Derby in late 2012 employing 8 fully trained contact centre staff, why Derby? well that’s where it seems the rest of corporate UK has their contact centres so we had a huge pool of talent to choose from. It also separated the call taking from the despatch office which was located in London, quite often despatch have too much say in how many bookings can be taken which as a business is unacceptable, management run the business and having staff trying to make their own lives easier is not an option.
So why are we stepping away from this sector? Reading below you will see the challenges we had to meet head on, and there were many hurdles to get over.
Here are my opinions on the people and companies we were dealing with throughout the period.
On our Competitors
Most of the competition are one man band operators who advertise on Gumtree and eBay, very few go down the Google Adwords route. They are ma and pa businesses answering calls on a mobile phone and giving estimates off the top of their heads.
As a business and in an ideal world you would want to work with these companies, big or small, to assist covering jobs in peak periods. However it was never that simple, they would always prioritise their work over yours constantly to a point where no van would show at all.
On Business Partnerships
So we have had three business partners since our conception, the first of which lied about having to go to the United States to look after his children whilst as his ex partner was dying of cancer, the truth was in fact that he was on trial for fraud and awaiting a sentencing hearing for which he expected to receive 9 months in prison. As you can imagine that is probably one of the worst things you could make up and we requested a meeting with him. Once he realised he was about to be found out he took a van booking from a client and had them transfer the £500 payment to his personal bank account and never showed for the meeting we had requested, however he did leave us with paying the driver to do the job to Glasgow which had been under quoted to win it costing us £700. He now runs a man and van business.
The second had a failing private hire business in London NW2 but had the infrastructure and staff in place, I saw this as the path to least resistance and we went into partnership. Within 3 months he saw the potential and looking at his failing business decided that he could replicate the business and launch his own man and van business. On the 21st December 2012 I was heading away for a family Christmas when our GM emailed me to say that he could not get into the bank account, I immediately knew what was about to happen and within 36 hours it had. Copying everything from our website word for word to our Google Adwords campaign structure he launched his business.
He then proceeded to take the £22,000 himself to set up his new business leaving numerous staff and drivers without any money over Christmas, despicable. When they were calling him to ask where their pay was he was telling them that he had nothing to do with the business and that we had just rented space of him. I had to tell these people the truth.
The third who we put together a rescue plan after the above incident allowed us to use his card payment gateway and office premises in exchange for shares. The first week or two was ok but then the money transfer started to slow between his card gateway and our bank account. Now it depends on who you believe he accused his GM of running off with our money and after speaking with the GM in person he stated that our monies had simply been sucked into an overdraft, which I believed. During this time of course we could not pay our Google Adwords bill and they promptly switched us off. Back to square one yet again.
As you can imagine there was no rush to find number 4, instead we changed the focus of the business away from service delivery to technology.
So for the most of the drivers that have worked for us I feel sorry for those who were caught up in, fraudulent advert clicks on Google, PayPal account restrictions due to a peak in takings where we were unable to pay them on-time and when their colleagues failed to show for jobs where we had to refund clients in full. The private hire sector is set-up only to screw the drivers and that is not what I wanted from this business, I wanted them to work, earn money and be paid, however when Google switch of the adverts due to non payment (see more below on this topic) the business stops generating revenue and we end up with a cash-flow issue, driver doesn’t get paid on the day he expects it and refuses to work even though he has been allocated jobs. So here we have a knock on effect, now we have clients on the phone asking where their van is and it snowballs from thereon in.
There are many drivers and affiliates who have accepted work from us and failed to show at the clients address and switched their phones off, we can only assume that this is because they have taken a private job.
Whenever the driver or affiliate doesn’t show the costs are enormous, with a average job value of £130.00 typically they would be as follows;
- Google Ads Cost £39.00
- Contact centre Costs £16.90
- Despatch Costs £13.00
The £130 needs to be refunded to the client and the total costs £68.90 approximately need to be claimed back from somewhere, in the affiliate case it’s just not possible but from the driver this is the only option we have, we also need to claim back monies for brand damage and loss of profit. After all costs our typical profit margin is around 7.5%.
They always reappear on pay day asking where their monies are, none of them read the drivers manual and agreement we provide before they start and only now do they realise they have been penalised for disappearing, these fines are heavy and in most cases can wipe out the driver pay, the monies are used to refund clients and manage the fallout from brand damage when clients go to social media to express their displeasure, and rightly so. It is then normal for these drivers, it seems, to threaten our staff with violence in order to bully us into paying them, this doesn’t work but does create mayhem with the constant phone calls when they decide to hide their phone number. The female members of staff in the call centre boar the brunt of most of the abuse and it’s not a coincidence that the bulk of the drivers in question believe that women are second class citizens and it’s normal to speak to them in that way.
I myself have been threatened with death by so many methods I lost count, one in particular I will never forget, we had changed a drivers working status from employed to self-employed providing him with a brand new van, equipment and a fuel card, he completely misunderstood the rates of pay and despite our several calls to him explaining that he needed to work harder, which he had under the employment contract, he only seemed to work one or 2 days a week. We only later discovered that he had read the drivers rate sheet incorrectly and was doing just enough to cover his expenses, or so he thought. On his first pay day we generated the pay-sheet and sent it to him which was now in a negative balance, he called screaming down the phone demanding the £1,850 he thought we owed him. After several calls to our GM at the time I took the call to explain to him the situation, his response was typical but in this case he didn’t just threaten me his words were “I will cut your throat with one hand whilst I hold your Son in the other so he can watch”. My Son was 3 at the time and I had no choice but to call the Police and he was arrested and with my agreement he was cautioned, all this over a misunderstanding which we had done everything we could to make sure he was out working.
On Google Adwords
I am going to start by stating that Google are complicit with internet click fraud, I can say that because I have proof, read on. This applies to many companies across all sectors and not just us or ground transportation in general. It is normal in this particular business to have an ROI (return on investment) or £4 back for every £1 spent. As an example our budget is set to £250 for the day between 10am and 5pm, we would expect a return of around £1000.00 in sales with that level of spend. However our most important keyword is also the most expensive ‘Man and Van London’, our competitors using an IP address cloaking software will constantly search for that keyword and click on our advert, each time they click we are charged by Google and it is not unusual to have 120 fraudulent clicks on our ads in a single day, this wipes out our advertising budget for the day so real-world clients cannot see us at all, some days we have been off within the first hour of advertising. Google have a safe in our hands policy according to their help desk but this is just not true, not only do your ads go off due to the budget being exhausted but they also debit your card to pay for them that day. Whilst you sit waiting for them to credit back the fraudulent clicks you could offline for 2 days, again its the suppliers / drivers who suffer.
A client of ours who we manage Adwords for has been charged for 160 invalid clicks in just 15 days advertising, at an average of £2.50 a click that is a total of £400.00 with no idea of whether it will be refunded or not. We are assuming that as some of these clicks are now 18 days old that the answer is no. You will see below the spreadsheet we have produced showing comparison between Google’s opinion and ours. So if you are burning £26.00 a day your ROI will drop significantly.
Its funny when you think that Google are to produce a car that drives itself, they have bought a drone company with a view to providing internet in remote areas, they are launching a virtual reality business yet they cannot determine that when the same IP address clicks more than twice in a row that this is fraud. I can see it by looking at the weblog in real time, but who am I. My point is that by charging for fraudulent clicks they are in fact complicit with internet click fraud, FACT.
Google offer a bank direct debit facility, great you might think, so this is why you should stay far away from this. In our case Google would raise a direct debit order when the spend limit of £500 was reached and as you know this may take a few days before it kicks in. If you are spending £500 a day then it is possible to have 4 in the pipeline, a total of £2000.00, if the first bounces for whatever reason then they pause your ads and demand that the whole £2000 is paid before they will switch you back on, irrespective of whether the clicks are fraudulent or not. So now you cant advertise that equals no revenue, so no money to pay Google, where do you go now? Nowhere is the answer, you are dead in the water.
On Paypal for Business
For the most part PayPal actually works, however its when you get confortable that they catch you out and this is a major setback when they do. I will use my experience and tell you what happened on one occasion.
January 2014 was a busy month for us, after a normal quiet period leading up to and over the Christmas period the bookings were coming in and the adverts were on. At the end of January I downloaded xxxxx t our business account as we had a direct debit coming out for Google Adwords and staff & drivers to pay. It was Friday afternoon and the transfer was complete, I received an email shortly after from PayPal which I had never seen before, I logged back into the account and saw that my balance was now much higher than before and discovered they had reversed my transfer and locked the money in with a message saying Pending Review. Confused and angry I called them and they explained that because we had taken so much that month it has created a spike in their chart and they taken the money back from our bank account and put the account on hold. So now the knock on effect again is that the Google adverts have gone off because we have missed a direct debit, staff cannot be paid the first pay day after Christmas and again the drivers cannot be paid.
During this period we unfortunately built up some debt and can now focus on paying those individuals back.
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