Ken Lucci 0:26

Well, good afternoon audience, and welcome to another exciting episode of the Ground Transportation Podcast. My name is Ken Lucci from Driving Transactions. We're a financial analysis, business valuation and m and a advisory firm, and I am joined by my partner in crime, who I've missed terribly. Who is the road weary? James Blaine

James Blain 0:51

Road rear, road warrior. Hello?

Ken Lucci 0:53

From Pax Trading the best, the best driver training program in the chauffeur industry and the motor coach industry. Is there even another one that comes close?

James Blain 1:03

Uh, no. No, not that comes to mind. No. And, and we're, we're slowly expanding to all of passenger transportation. So if you drive passengers for a living, we're gonna have training for you.

Ken Lucci 1:13

And they's the key. It's the reason why he's road weary. He's on the road, hit on every single week. We can't catch him here, unfortunately. You, you know, the poor audience is the one that has a problem. 'cause they have to listen to my nonsense constantly alone. They tune in and they're like, wait a minute, we wanna see James. Why does this Anyway,

James Blain 1:33

they'll have better financials for it, so pay attention people.

Ken Lucci 1:36

there you go. So, uh, today we're hitting upon a subject that is near and dear to both of us. And I think that the industry has a well, small business in general, but our industry has a serious issue with business owners working in their business and not quote on their business and being overall reactive. Um, and today we're gonna talk about proactivity and we're gonna, we're gonna nail proactivity. With three on three subject matter. three pieces of your business that are critical, safety, business development, and financial planning. So James, tell me in your mind when I say proactive safety, what does it mean to you as far as what an operator should be doing to be on safety proactively? What does it mean?

James Blain 2:33

so look, the, the biggest thing that I see, and it's gonna show up in all three of these sections, is that we tend to have this mentality that none of this is special. This is stuff we've done forever. This is stuff we know how to do. This is stuff we, you know, the people that we're hiring know how to do this. This isn't a big deal, right? I see it all the time. You know, Hey, this guy's been driving, you know, 20 years or 30 years, or, Hey, I hire, I only hire experienced drivers, right? I don't have to worry about training my drivers 'cause I only hire experienced drivers right

Ken Lucci 3:05

Right, or this driver, this driver hasn't had an accident in 10 years. You know what that tells me? He's due, he is overdue.

James Blain 3:13

And, and here's, here's the funny part about that, right? It's kinda like saying, I'm gonna hire and, and you tell me whether this makes sense, right? I think of it as like, I'm not gonna go hire somebody to manage, my finances, that's been doing it forever and not knowing anything about his background or anything else, just, oh, he's just been doing it forever, right? Because, and I say this all the time, how many people you know, have been doing their job forever and still suck at it, right?

Ken Lucci 3:41

Right? And, and sometimes, sometimes you, you, you are correct because I call it the, it's the single box mentality. Every single day they open up the same box and that is their point of reference for everything they do and, and sometimes. Muscle memory, especially in our industry. habits are a bad thing when the world around you is changing, right? and we can all agree, we can all agree that one of the top three in issues in this industry is fleet insurance. And

James Blain 4:17

Yep.

Ken Lucci 4:18

you cannot be treating your safety the same way as you always have if you want to stay in business. Because the fleet insurance companies at this point are taking no prisoners doing no favors, and I don't blame them and losing money. So what is proactive? safety plan mean to you?

James Blain 4:39

Okay, so, so I'm gonna give a very unpopular opinion, right? Don't cancel me for

Ken Lucci 4:43

By the way, you look like you, you do look like shit, but keep

James Blain 4:46

I could use, I could use a nap. I saw that road

Ken Lucci 4:49

You could, you could, but that'll be at the end of the day today, so keep going.

James Blain 4:53

it's all right. It's all right. I'll rest when I'm dead. I'm too busy helping operators to sleep.

Ken Lucci 4:57

Good idea. Good sentiment.

James Blain 4:59

opinion here. Everybody says there's, you know, there's an insurance crisis, there's a crisis on this, there's a crisis on that. But I can tell you I've spent the last 10 years of my career preaching and telling anyone that would listen, Hey, we've gotta get in front of accidents. We've gotta get in front of incidents. You've got to understand, right? The number one thing I see in companies is, well, we don't have any accidents, we don't have any problems. We can scale back our training program. Well, well, okay, so hold on. So you're saying, because you are winning, right? You've got a winning team. My coach is going to have them do less practice because we're winning anyway. Like it makes no sense

Ken Lucci 5:40

It makes no sense. It's like, it's like it, it is a bad analogy maybe, but it's like the Secret Service saying, you know what? We haven't had any attempts on the president's life, so therefore we're gonna stop the

James Blain 5:50

We're gonna scale

Ken Lucci 5:51

gonna stop, we're gonna stop the mandatory re re-upping of, uh, firearms training. Uh, close quarter firearms training. We're gonna stop that because we haven't had anybody that's threatened the president that way. It's ridiculous. Or, police department saying, you know, crime has really, really, really been down. Let's fire that crime prevention officer and stop that entire program.

James Blain 6:14

Well, and here's the other thing, right? If, if you want to go down that same road, you know I mentioned the people. I only hire people with experience. Well, great. What do you know about the training program of the company they work for? What do you know about their day-to-day at the company? They work

Ken Lucci 6:27

Well, you are also hiring their bad habits. Agreed. Yep.

James Blain 6:30

a hundred percent. You're hiring their bad habits. You're hiring everything that came with them. One of the things that for me is huge is if you are going to get ahead of something. The only way to get ahead of something is to do it now before it's a problem later. So, you know, you think about it and one of my favorite examples is it's exa and, and I hear people all the time with their training programs, look, if you had a heart attack, right? You had a heart attack, you're like, oh man, I had a heart attack. You go and they say, you got a bad heart, and you say, no big deal. I bought a new Apple watch 'cause the new Apple Watch will send all of the data for my next heart attack to the doctor. Instead of

Ken Lucci 7:12

changing your behavior.

James Blain 7:14

your behavior, trying to get healthy, right? No.

Ken Lucci 7:17

Really good analogy by the

James Blain 7:19

Well, but think about it. We, we see it all the time. You gotta treat it like your health. And what's really funny is we have a lot of close calls, especially in businesses where it's a close call and I talk about something called the 72 hour rule. And if you wanna learn about productivity, human psychology, and human nature, the 72 hour rule applies to practically. Everything that you are gonna deal with. And it goes a little something like this. Hour zero is some kind of close call near miss accident crisis, something really bad. That is kind of like a wake up type moment happens. At that point. for the next 24 hours, you're typically in like crisis mode. I gotta handle that immediate problem. Now, what happens directly around that once we kind of pass that 24 hours, okay, how do I keep it from happening again? you know, whose fault was it? How do I take care of it? How do I get ahead of it? That's typically when a company like ours gets a phone call. Hey, some, you know, we had a guy with an SUV at the airport and the passenger swung the back door open and got ripped off 'cause the passenger or the chauffeur didn't put his hand on the door and hold it closed.

Ken Lucci 8:33

They, they did, they disembarked on the wrong

James Blain 8:35

Right. They got off on the wrong side. Hey, I had a, you know, one of the guys was driving my band, new motor coach. He didn't get out and look and he couldn't see it on the camera, and he backed into a car, or he turned through a curb and hit a Ballard. Right? It's, it's always the simple things. And then what happens once they, they hit that point, you have 72 hours to make one of two things happen. Okay? At the 72 hour point, it's gonna be done. If you haven't made the decision, your decision becomes indecision. Now, your brain can't live with indecision, right. No change, but, but your brain can't live with that. Right. we don't like the idea of, I didn't do anything. So we bs ourselves, we lie to ourselves, we make, you know, we were overdue. You know, it wasn't that bad. You know, that's the first time he is ever had it, you know? Right. You, you lie yourself because it's easier than making a change.

Ken Lucci 9:31

you. The word is rationalizing.

James Blain 9:33

It's a hundred percent rationalizing, right? So you are rationalizing this problem away. Now here's what's funny and here's why I bring it up. In our world, we call that the 72 hour rule. If you look at an unpaid bill from someone, right? Let's say you have your a and r. I'm sure you'll, you'll appreciate this. Once your a and r gets to 30, right? Once you get to 90, your chances of getting paid drop. Once you get to 120, they drop even further. And what the further out you go, it starts kind of hockey stick in the wrong direction straight down until your chances getting paid are zero.

Ken Lucci 10:07

So, so your point is when something happens, you have the opport opportunity to turn it into a teachable moment and change so that you can make sure that that behavior doesn't happen again. Okay. Or you can do nothing. And you've done really at, at some point you probably, you didn't do anything to make sure it doesn't happen again, and, and I bet you it actually increases your chances of a repeat performance of the same issue.

James Blain 10:40

and what's, what's crazy about this, Ken, is it's actually worse than that because typically what happens is we don't get proactive. We're not doing what we should be doing to prevent an accident or a service failure or any kind of other issue in the business. Right? And nine times outta 10, it's a human training error, right?

Ken Lucci 11:02

Uh, absolutely.

James Blain 11:03

look, e even if you, you know, you say, oh my gosh, we had a freak accident. The wheel fell off the vehicle. Right? The wheel just fell right off the

Ken Lucci 11:11

no, it, it's either process or human issue,

James Blain 11:14

Right? I

Ken Lucci 11:15

process problem, human issue,

James Blain 11:17

Yeah. You go look at all of the accidents that are, that very, very few of them. Are freak issues, right? It's, well, we went back and we looked at the maintenance. They weren't doing maintenance. Well, you know, we had a service failure here. Well, we went back and this person didn't know where they were going, right? They went to the wrong place. They, you know, they weren't paying attention, they weren't following. So what happens is we have these failures to get ahead of things. We have these wake up moments, these 72 hour rule moments, and if you don't make an active, meaningful change and get back on track, eventually what happens is you start seeing these cascading type issues where it gets bigger and bigger. And a lot of times, especially in our world, it can go from zero to a hundred real quick. You might have a bunch of little incidents because, you know, I'll give you a great example. You have someone that follows too closely. They, they, that's their thing. They follow too closely and. For a time, you know, they have a couple close calls, they get lucky, and then they're following too closely on a tanker truck and a squirrel runs in the road and the guy slams on the brakes and the luck runs out. And

Ken Lucci 12:25

those squirrels.

James Blain 12:26

you know, it's always, they're

Ken Lucci 12:28

but, but back up a step, back up a step because you made a really good point there that I, everybody in, in the audience should, should understand that was not a flippant analogy.

James Blain 12:40

no, this is a real world. I see it all the time.

Ken Lucci 12:42

right, the Apple watch in relationship to preventing the heart attack is the same thing as the telematics system. As it is preventing an accident. The Apple Watch does shit for you if you don't change the behavior that the Apple Watch. The Apple Watch tells you something wrong and you don't address it. The same with telematics. If, all you do is check off the box, I have telematics, therefore I'm safer, I have an Apple watch, therefore I'm healthier. it's wrong thinking and I know that that's, operators are like, I don't know what your problem is. I have telematics. Well, you're not looking at it, you're not doing anything. Your analogy of the, the, of the following to close. Okay, that's behavior that would be picked up by the telematics system and, and you should be addressing it before the squirrel runs in front of the tanker and causes a pile up.

James Blain 13:44

Well, and what's funny, right? You know, I'd love to say, Hey, I'm in marketing. I'm the fun sugary candy you get to eat. You know my world where,

Ken Lucci 13:52

by the way, I've never thought of you that way,

James Blain 13:54

Yeah. No, no, no. That's not me. But, but no, you think about it, the training really is, it's kinda like the gym. It's kinda like the working out. You know, you should do it a lot of times, just like your New Year's resolution, man, we're gonna fix our training, we're gonna fix

Ken Lucci 14:07

Okay. That's another analogy. That's another analogy. You are the personal, wait a minute, PAX is the personal trainer answer to getting healthy. You know how many people join the gym and they never go. They have every intention of creating a workout regimen. Okay. And they don't. Right. Personal trainer in, back in the day when I had really, really solid pectorals, I had a personal trainer way back when, but I could not have achieved the level that I had of, my health without him. And to me. For every company out there that says, yeah, we have our own, has in-house training. You know what I say to that? You know, again, you are basing your training based solely on what happens in your market, in this box in your company. Whereas somebody like a PAX is taking it all in from the entire industry. All right, so proactive safety.

James Blain 15:04

Wait, we're we, we, we gotta, we gotta stay on this for a second, right? Because your, your analogy, man, there's so many facets to it that, that we could bring in here and I think it's probably the easiest way to explain this, right? Plus I wanna see pictures of, of the six pack abs in the pecs. But, but, we'll, we'll

Ken Lucci 15:19

pack, as I said, I said really nice packs.

James Blain 15:22

Okay. Well, I wanna see the really nice pex

Ken Lucci 15:25

When I had a six pack, it was 'cause I was, I was kayaking every day down in Florida. But I digress. Go

James Blain 15:30

Yeah. Yeah. So, so look, I brought that up for two reasons, right? The, the first is. A lot of times what happens, right when you go through it to force, you go through a breakup, you go through whatever, man, I gotta get sexy again. I'm gonna hit the gym. And, and you crank on it, and then what happens? You kind of taper off, right? We see the same thing in our world. Well, we had an accident, we had an incident. We get real serious about it. We, we, you know, we're getting, we're gonna get it all taken care of. We're gonna really focus on our training program and then it tapers off, right? We gotta get someone on the road faster.

Ken Lucci 16:02

but what you're saying is proactivity is all about consistency

James Blain 16:05

It is, it's a hundred percent about consistency. It's about the reps, it's about doing it right. And two, the point you made about a personal trainer, right? There's, there's, and, and I be completely transparent, other than creating your own platform to do it, there's nothing about what we're training or doing that you can't go put together yourself. The difference, and you've already nailed it, is one, this is what we do. I live on the road. I live with my customers. I eat, sleep, breathe this, this is my world.

Ken Lucci 16:37

and the input data and. The program is based on the touch points that happen around the country and the experiences around the country, not just your specific company. And it's, it's, tailored to, you know, every facet of what could go wrong in the space, not just in your market, not just your specific vehicles. I mean, you know, it, it's, it's funny, some people think of, of Pax as chauffeur etiquette training. I'm like, dude, you have no, I, it is so much, it's so much more than that. It's like when someone says, well, what you do is format a p and l. That is, look what we do is we

James Blain 17:17

syn Excel spreadsheet.

Ken Lucci 17:18

right. We teach you how to format it and how to read it and what's important about it and when, when you're not profitable, what's wrong with it. So the depth of safety training, let's just, the, the basic elements you, you do, you think you can't really have a decent safety program. Be proactive about it without a managing a telematics system, correct.

James Blain 17:41

Well, I think what you are, talking about, let's stick with that health analogy. You know, if you are going to the gym, right, you can go to the gym, you can work out, you can, you know, figure out machines. You can do it all on your own. You can, I mean, that's what they used to do. But I can tell you right now, there's not a pro athlete in his right mind who isn't wearing an Apple watch, a Fitbit. All the tracking equipment has a personal trainer is if you wanna get the most, you, you have to go down those roads

Ken Lucci 18:08

Oh, it was, it, it rang home to me to have, to have somebody like a Pax to me is equivalent to when I, and to have somebody like what we do is the equivalent to when I used to drive Derek Jeter to batting practice in the morning and the bat, the, the hitting coach used to meet him there. I'm like, KA, you need a, you need a pitching coach. He's like, Ken, I'm telling you right now, you cannot play this game without continuous coaching. And you have to be able to be coachable. There is not anybody in, and when I see players, new players, or seasoned players, I say to them, you need to play this game and you need to hone your skills every day. Like it was the last game of the World series along with the first day, the first game you ever played. So, um, so proactivity is consistency. Proactivity to me is also, it's also best practices.

James Blain 20:17

Agreed. And I, I think, I think the biggest thing I, I'm gonna give a a, I've probably given this on the podcast before, but I'll give this quote. When I was a kid, my dad told me that you don't go to college to learn what you're gonna do at your job, right? A doctor is not going to medical school to learn every scenario, everything, right? They're gonna get on the job training, they're gonna see cases on, they're going to learn the mindset and the way that doctors think. An engineer is not going to engineering school to learn how to engineer stuff. They're learning how to think and apply and solve problems in the same way as an engineer, I would tell you that when it comes to being proactive, you have to learn how to have a proactive mindset. You know, for me, my thing. A proactive mindset is where you're trying to get ahead of issues and solve problems before they happen. Whether that be your financials, whether that's your marketing, whether that's your safety, you know, business development, it doesn't matter, you know, as we progress this conversation, you're gonna see this bleed over into all of it. But most importantly, I think the difference between being proactive and trying to get ahead, because I do think they're different, right? Being proactive and trying to get ahead are completely different. And that someone who is proactive is typically someone who is being intentional. I can try to work ahead, I can try and get, you know, ahead of myself. That's not being proactive. Proactive is, I'm intentionally saying, Hey, I know that I have to do this now to make things easier later.

Ken Lucci 21:59

I agree. I agree. And when I think of proactivity, I think of planning. Right. But, but let's, let's just make it simple for everybody out there proactivity. at its basis, if you accept the premise that most business people are reactive, they're reacting to situations that are occurring, I think the, the, the basic starting point is don't let the issue happen again. Okay. So,

James Blain 22:32

the 72 hour rule, don't be the one that sweeps it under the rug.

Ken Lucci 22:36

so a couple things. You have to put the foundational elements of a safety program together. You have to have the safety manual, the telematics, the ongoing training. and you have to manage the data and manage, manage what you see. Okay. And constantly reinforce. That's the consistency piece. I have a client who I really like. Uh, I mean, I, I like all my clients so they wouldn't be my clients.

James Blain 23:02

But this one more than the others,

Ken Lucci 23:04

a couple people who are no longer my clients are no longer my clients 'cause I just didn't like them. Right. But, but, and I, I don't lose many clients. But, but when a client is not listening, I, I, you can almost tell it. I stop talking and I really stop engaging with them proactively.

James Blain 23:22

Oh,

Ken Lucci 23:23

And this one particular client is stuck. And he's stuck in, in many ways in his business. And I say to him, you know, you've talked to me several times about things that are going wrong out in the field, uh, with the vehicles and. my feeling with this is, is if it happens once, it's your fault that it happened a second time.

James Blain 23:47

Yep.

Ken Lucci 23:48

Okay. So, so, okay. So that's safety. My other pet peeve about proactivity is this has been 2025 has been a different year than 22, 23 and 24, right? 22 coming out of the pandemic, everybody was on a sugar high raising their rates. Right? I think 23 was a really, really strong year because people raised their rates, raised their rates in 22, and they had the teams back together in 23 and, and get their stuff. But, but I have to tell you, the sentiment in 25 is a little bit different.

James Blain 24:23

Oh, it's completely different.

Ken Lucci 24:25

is completely different. As I prepare for the state of the industry, we're pulling our data and there's a lot of companies out there that are flat. Okay. When you look at the overall travel feeders, the, the airlines, the, uh, corporate travel, the group and meeting industry, the cruise industry, the private jet industry, all of those industries are up now with, with a couple of caveats. Summer's, tourist season was down okay. Because of the tariffs and, you know, whatever, geopolitical, but overall corporate travel and airline travel is up. So, you know how I am and I, I troll Facebook and I, and I shake my head. When I listen, I see operators, is it, is business flat for everybody, you know? I've come up with a phrase that it's not your market, it's your mindset and proactivity. We just touched upon it a little bit with safety, but proactivity, I wanna talk about business development. Okay. Because, you know, it seems like you've been on the road nonstop.

James Blain 25:37

I fair statement.

Ken Lucci 25:39

doing business development. Okay. And in our own businesses, when we get into any kind of a lull, which doesn't happen anymore, when we were getting into a lull, it's because we didn't have consistent business development going on. We would take on engagements, we would be immersed in the engagements, and we would stop our marketing. This was before we had John. So I wanna talk to the operators out there that say, you know, this is an extremely tough year. No, it's not. Okay. what I would challenge every operator is to answer the question for themselves is, have you increased your proactivity on both sales and marketing? Oh, I've upped, I've upped my, uh, my Google, my Google Ads budget.

James Blain 26:29

Oh geez. Here we go.

Ken Lucci 26:30

no. Don't get me on that soapbox. Right? Don't get me started on that. So, when I think of business development and proactivity, w what does it mean to you? Because, I mean, you've been out there kicking ass at these associations. What does proactive sales and marketing mean to you?

James Blain 26:47

So I will tell you, for me, a lot of that came from my time in a, they were actually now in a, a council in a, b, a. But back then we were just a group and it was called the driving force. And the whole idea was the driving force was, this is kinda circa 2020. we're trying to help operators with recruiting, with hiring, with that piece. And we developed an entire freaking manual. It was, it, it literally was a guide. That was all of the amazing ways that you could hire and train and get people up and get people going and get 'em excited and recruit 'em in, you know, and, and it was, you wanna talk about an all star team, right? I had the least amount of experience at anyone on this group. We've got Brett Maitland, we've got, you know, Adam Hall, um, Aaron was running it. I've got Pam Ez from Daco, you know, Mike McDonald. We've got this All Star team, and

Ken Lucci 27:41

So, but tee it up. This is during the pandemic

James Blain 27:44

This is, this is coming out of the pandemic,

Ken Lucci 27:47

right. You and, and you had to be proactive

James Blain 27:51

you had to be proactive, you had to try new things. You had to go out on a limb. You're trying to get your, you know, your driver force back. You're trying to get new drivers. And I gotta tell you. The things that we would hear is hiring's, toughs, hiring's tough. You don't understand hiring stuff. Do you know what percentage of the people that we would hear that from actually used all these resources? Right. We've got probably a couple hundred years of experience on that group. Literally a couple hundred years probably of experience between everyone on that committee. And we've put together this guide and people are doing the same things over and over and over, and they're not trying new things and, hold on. But, but here's where I wanna bring it back to something you said earlier, they're rationalizing it, they're doing the same things as they were before. They aren't working and they're rationalizing it with, well, you know, it's just a hard, and, and this is what you're talking about a second ago. Well, it's just a hard market. Well, the mindset is, I don't need the change. It's not me, it's the environment.

Ken Lucci 30:06

Well, and, and you know, I, I, I have, I have a famous saying. I, I used it at a 20 group with some of the most profitable companies in the industry. I was invited, you know, one of 'em is the head of a global network and the, the others, every single one of 'em is over 20 million, well, most of 'em over 20 million. And I said, you know, to some extent I like to talk to people who are non profitable because they listen better. And they say, what do you, that's kind of insulting, Ken. I'm like, look, you're extremely successful. The problem with people who are successful is omniscience thinking where they think they're the smartest person in the room and they don't ask for help. And second of all, they also think. And some of them don't listen to the advice when they get it. you are so successful that you think that tomorrow is gonna be like today and yesterday. And I think that that's the key to proactivity in business development is just 'cause it worked last year. Just 'cause it worked last month. Just 'cause it worked for you for your entire career. It does not mean that it's gonna work tomorrow. You know, there was a time, there was a time where direct mail was fantastic, then it went out of favor because of email. Well, now it's back. Okay. So, and Arthur Messina from Creator Card talked about that on the episode. But as far as sales and marketing bd, so you hit upon something, you know, you, you did it on the, the hiring project that you have. But as far as to me on proactive sales and marketing it's the same thing with safety. It's about consistency. Okay. It's about, in as far as I'm concerned, in sales and marketing, not only is it consistency when you, when you start something, see it through, it's about measurement of everything that you do. But more than anything, proactive, as far as sales and marketing to me is not being afraid to try new things and not being afraid. In my estimation, the biggest issue is it's, it's a much tougher market in any business to appear above the noise. So I think the secret to proactive sales and marketing in our space, as far as I'm concerned, starts with two x or three x the amount of marketing you're doing. And I do not mean triple your Google Ads budget, I mean. Try two or three different types of different things. Okay. To go out there and reach your target audiences. Okay. But do more, more than what you, traditionally been doing. Well, what do I, what do I mean by that? We've helped five of our retain. Yeah. Five of our retained clients, three of them have hired salespeople and the other two are just launching it outside salespeople, but they're actually hybrid. They're inside and outside and we've designed a program that starts with their existing customer base and I've asked the question, I said, okay, this is pro, this is gonna be proactive. When was the last time you reached out to all of these people? Assured. Assured that you have the contact information of everybody inside that company that could possibly by transportation. So proactive. Building out of the contacts, proactive contacts. Okay. Instead of just waiting for them to call you by reservation with our program, one of the things we do is we look at same time last year and the next three months, and we say, you know something, last year in September you did 75,000 with them. we didn't see that this year. We're not seeing that. Or, you know what they did? They did 80,000 with you last November. You better reach out to them and see if we're gonna get that again. proactivity to me is consistency of your campaigns. It's two or three xing. The the strategies that you're using for, for both things, sales and marketing specifically marketing and promotion. And then the other thing to me is, is reactivity. Is it this industry is built around waiting for the reservation to take place rather than. Using the data from past years to project, predict and manage the sales that can take place. I mean, proactive top five customers, one of 'em is a law firm. Geez. Do you think they're the only law firm in Boston? Do you think they're the only law firm in la? Chances are no. How about we proactively create a list of the top 20? Right. So I, I mean, it is funny, the industry to me is, it's interesting. It seems to me like it's in a period where it's its own worst enemy at this point.

James Blain 34:55

Yeah, but here's the, here's the thing, right?

Ken Lucci 34:58

some companies.

James Blain 34:59

Yeah. But you know, if you, if you want the easiest example of being proactive. Right. the person that's, and, and we're, we're in the driving industry, so I'll make it real easy. The person that is driving, looking two to three car lengths ahead is a reactive driver. They're going to have to react to what happens in the environment when it happens in a real time. 'cause if they don't, they crash. The proactive driver is driving the horizon. They know what's coming up ahead. They know what's further down the road. They know to get into a lane to position. Now how do you, They're managing it. now,

Ken Lucci 35:39

They're monitoring the horizon and they're managing themselves.

James Blain 35:42

They're exactly, but they're positioning themselves before the situation happens. And by changing position before they reach the situation, A lot of times they've already taken action that prevents them from ever having to take a reaction. And I'll repeat

Ken Lucci 36:01

Or Or guarantees the result, it guarantees the

James Blain 36:04

will. Not only does it guarantee the result, it changes the situation and the outcome because for example, if you're driving two to three cars ahead and someone cuts you off, you've now gotta worry about, can I break in time? If you are not even in that lane and it happens in a completely different lane, you don't necessarily have to react to that because you weren't cut off, right? The situation never occurred warranting that. Now, you talked about the marketing. If you are looking at your marketing, I'll give you a great example. In my world, I know that around spring and fall. There's a big uptick in shows, and so I know that for us, we ramp up our marketing going into that, and then coming out of that, we know that we still keep marketing up. But guess what I'm really worried about coming out of that now, I'm really worried about delivering and trying to knock it outta the park for all of those new clients so that I can ride those cycles. I can't tell you how many times in business you see people that are just basically reacting, Hey, we had this great uptick in marketing. We're gonna absolutely plow into it, but never taking the step back to look at it and say, Hey, you know, every single year for the past four years, this has been my best month. Maybe I should look at how does it taper off? How does it build up? How do I prep for it? How do I possibly shift some of that over? That's kind of what the proactiveness becomes in every part of the business.

Ken Lucci 37:35

Right. And, and, and unfortunately, fortunately or unfortunately, every operator that's reached any level of success in the business pretty much has mastered getting a car from point A to point B. right. hopefully. But where I think there's a dearth, there's where there is definitely, um, there's always seeking the easy answer is, okay, who, who can I use for Google, for a Google paid ads or who, who's out there for digital marketing instead of developing a business development plan that should be implemented like a, an eight cylinder engine. Right. Whereas, you know, maybe one of those cylinders is Google ads in a certain, you know, certain space, et cetera. You know, it's funny, I remember somebody saying to me last year, oh my god, you know, they said this in like in January. Oh my God. New New Year's was terrible for us. And the ho there were no holiday parties. And I said, okay, so let's back up a step. You know, first of all, you're in a winter climate, so guess what, if you had a shitty December and, and New Year's, you're gonna have a tough time January, February. But anyway, or what did you do to promote the holiday party use? Well, uh, really not anything. We just didn't get a lot of calls. Okay. Well. No offense. Shame on you. Okay. If you, shame on you if, if you are not starting way before, okay. In anything. we used to when I was an operator, you know, a lot of people who live in Florida go north for Thanksgiving. Okay? So we would start before, right before Halloween saying if you're planning your Thanksgiving flights book your round trip now. Okay? The same thing with holiday parties. We, we used to do, specific email to all our corporate clients, you know, and he, this, listen, Uber was still in business. I mean, they, they were, in the beginning, people were enamored with them. And we would say, listen, you know what? if there's a a holiday party, we're gonna be, you know, we're gonna give you a special rate on SUVs or a special rate on group vehicles so that multiple couples can go in the same vehicle. And the same thing we would do for New Year's. We would, we would advertise New Year's is the amateur hour. Leave your transportation to the professionals in addition to that. You know, the funny thing, and I'll tell you this is a really good proactive story. We noticed that around uh, Valentine's Day, we used to get a lot of calls from our professional, um, sports players saying, Hey Ken, you know, I, I wanna take my wife out for Valentine's Day. Can I have a car? And I'm like, yeah, no problem. And then they call back and she, I can't get any decent restaurant reservations. So we used to, this is a really good tip and probably interesting, but we used to make reservations at the top 10 most romantic restaurants. Under the name Ambassador Limousine, we would say,

James Blain 40:44

So you had it ready to give out?

Ken Lucci 40:46

we've got a VIP client. He doesn't want to give his name. We wanna secure this. Okay. We, we want, is this a, are you gonna do this for us? And that was like, I learned that the first or second year, because we always had the Yankees for an accountant. And then we had the bucks for an account. And then we had, the raise. The guy that ran the clubhouse used to love us anyway, so when we did it for the VIPs, then the next year we sent it out to our entire database saying We have secured reservations at these restaurants. First come, first serve, don't miss out, but it's part of these packages. Okay. And we would go from the Phantom Rolls Royce down to a sedan, Phantom Es, Cadillac, Escalade, Escalade executive and standard Sedan. And I'm telling you, they absolutely reservations are already taken place. And we have a, a seven. A nine or an eight. Right? What do you want? The Phantom. The Phantom sold out to the point where I, I mean, I would go to the Rolls dealership and say you got anything, you know, put a dealer plate on it and they, you know, I think one year we ended up doing it, but my whole point was We would start planning that in January.

James Blain 41:59

But, but let's stop for a second, Canton. 'cause you're, you're nailing exactly what I talked about earlier because if you were just trying to get ahead and you're like, yeah, I booked these reservations, then I hoed them, right? You have something different here and that you are being proactive because you're being very intentional about it. You are building out a campaign, you're building out packages, you're building out a plan. It's not, yeah, we made a bunch of reservations so that we could, you know,

Ken Lucci 42:28

no. And did the Rolls Royce package, the Rolls Royce package had. The Rolls-Royce package had ro roses in it and it had a bottle of champagne in the back. And that son of a bitch went for 1995 that night. And, and I was like, I don't give a shit if it doesn't sell. It did it really? Every, and we had to put, we put the antique rolls on on as a secondary package as well. Right. And it really, but you are correct. And you know, once we had it the first year it was, we rolled that out every year. The same with holiday, the same with holiday lights, the same with board meetings. Okay. Every public company that has board meetings has of around the same time every year. Okay. And we were smart enough to know when we served serviced a board meeting that they came to Tampa to, to play golf. We would make the phone call the next year and say, are you coming back? No, we're not this year. We're going down to Miami. We can help you in Miami, but. But we had to do that 90 to 120 days before by looking at the data that we already had.

James Blain 43:36

But it's, it's interesting, right? Because seasonality is such a great example. I can tell you one of the things and you're gonna laugh 'cause you're the financial guy. One of the things that I screwed up my first probably five, 10 years having my own business was taxes. Right? Speaking of something that's recurring in practice, 'cause I'd wait till the end of the damn year to figure out what I personally owed in taxes. The day I figured out how to actually actively start being proactive about my finances, changed everything for me owning a business, right? Because it's so funny, we talk about it that safety marketing, finance, like this is something that this mindset, even if it's not a seasonal thing, any part of this, I mean, being proactive applies in so many areas now. I think one of the things for me that I struggled with initially was identifying what areas I wasn't being proactive in. I found this rule that I really liked, right? And that was that I had a three strike rule. Now, this three strike rule, if it was something really bad, would escalate. But if I ever had something that I reacted to three times and I didn't automate it, plan for it, be ready and get ahead of it, then I knew I was screwing up as a business owner. Now, does that mean that there's, and the reason there's that three strike rule is sometimes you get weird crap that you're just like, this is off the wall, I'm probably never gonna deal with again. So you wanna have some kind of filter. Right now in the safety world, it's kinda like, okay, if I get the three little things I know I've got ahead of it on the financial side, you know, after about the second or third time that I got a big unexpected tax bill at the end of the year, and I just scramble to figure out how to pay it even after, you know, had a great year. Spent too much of the money, don't have enough taxes, how many times are you really gonna let yourself do that? But I think this really kind of highlights that in all of these areas, you have to have triggers that say, Hey, I need to either automate plan or get ahead of, and be ahead of this and be intentional to keep stuff from becoming, Hey, I'm just a firefighter in my business.

Ken Lucci 45:53

And, and that's, you know, that's a, that's an extremely good term because most small business people are firefighters. Let, before we leave business development, sales, and marketing, I'm gonna tell you the number one. The number one tool you can use for, for, for sales and business development is an events calendar. It's a, it's a calendar for the year. Okay. It's a calendar for the year, and then it is to look at the events that take place from a corporation perspective. Most corporations do planning sessions. Most corporations do employee engagement outings, or they have an employee annual event. Most corporations, the large ones, they all have a board meeting. Okay? even some of them. We used to have advisory meetings at Ambassador. That it was show everybody in the company was invited to them, but we had a team. Anyway, so a calendar of events to plan around your sales and marketing. And the other piece of, of sales and marketing that I think that people get scared of is they think that to be a great salesperson, you have to be a great communicator. No, all you have to do is have consistency. Okay? You can go to Arthur Messina and Drew Messina and have them do an electronic brochure and electronic video that makes you look like the biggest company in the world. But you don't have to have, you don't have to be the guy pitching it, right? So it's all about consistency. And to me, it's all about, if proactivity to me is increasing the amount of. times the phone rings every single day. It starts with what your base data is. You know, I was on with somebody yesterday, great kid, uh, from Montana, really like him, loved the market, and he's gone from practically zero to $500,000, you know, over overnight. And, and, and we worked together on the financial foundation, and we'll get to proactivity in a minute. And I said, listen, the biggest problem you have right now is your chief cook and bottle washer. And you have to decide what is the most important things for you to focus on and then start at 500 KA year. You need to start off loading those so that during the prime sales times you can be proactive. Well, what do you mean? Well, you are in the land of the high-end phishing, uh, fishing lodges. I used to go to them, uh, my buddy Wade Boggs, when he was a client, Wade used to go out there one day. We, I was coming into Hubbard Lodge and Wade was leaving. I'm. Jesus. I mean, what are the odds of this? Anyway, you are also in the land of ski season. You are also in the land of some of the most prestigious ranches in the country. You need to get out there proactively because nobody sells the business like you. So to one of my favorite clients in the world who confessed to me the other day, probably wrongly, that he spends 15 hours a week doing billing during the day. I said, are you outta your mind? I You, you are one of the bigger companies in your market and you the owner sitting doing billing, you know, first of all, he might have a trust issue. I said,

James Blain 48:54

Little bit. Little bit.

Ken Lucci 48:56

right? Why don't we start, by you training somebody to do the vanilla ice cream billing and then you can. You can look over the global stuff and the high touch stuff 'cause I get it. So proactivity is also about doing the right thing at the right times. Alright, so final thing about proactivity that we'll talk about today is financial. So for every one of our retained clients, if you bought our course, you know, one of the things we do is we teach you how to manage your primary metrics on a monthly basis. And then when if something goes wrong with them and the primary metrics are not good, we teach you the secondary numbers to look at. So if your gross profit margins aren't that great. We teach you, okay, let's look at your fuel. Let's look at your fleet. Let's look at your driver. Something is off here. In addition to that, we teach you from a liquidity perspective what your, what your liquidity should be for the size of company you are. You know, their lending ratios. So to me, financial planning is tremendously overlooked because people, they say, well, I, I have an accountant. Okay, great. Do you look at the reports every single month? Uh, no. He just prepares my taxes. Okay, that's not financial planning. That's retroactive. This is what you owe. Do you know that 30% of small business owners have to either borrow a credit card, they have to borrow, uh, I think it was 28% of of small business owners have to borrow to pay their taxes. Did you know that they have to either use their line or they have to use credit card, et cetera, et cetera, because they haven't set aside the capital. Right?

James Blain 50:37

I I've been in that boat, right? I mean, that was, and, and it's funny because that my first business, right? My, my first business, you don't think about how it works. You don't take the time to, again, you're not proactive. You don't get the financial education. You're trying to make the bills work.

Ken Lucci 50:53

you are working in the business to try to generate the revenue. You're not keeping score. So, you know, one of the things that we teach people is, look, if you are on our financial program and you've got the monthly financial reporting and hopefully the, the KPI side, we want you to do proactive financial planning with an annual budget. And it starts with what you did last year. Okay? It starts with what were your metrics last year? What were good, bad, what are you gonna improve? So budgeting is proactivity. In addition, it's, it's, to me, it's proactivity is planning for and calculating how much liquidity you have. Okay? So for everybody out there, for everybody out there, look at how much cash that you have in the bank at the end of every month. If it was not appreciably more than when you started, you have a profitability problem that can be fixed, but why should I worry about that? Well, first of all, if you wanna buy any asset, the worst way to buy it is zero down. But you want to have enough liquidity to plan for your next vehicle. So how do you do that? You set aside capital plan for your down payment plan for your fleet insurance down payment. This, for some reason, has been the year of people wanting to sell because they can't. Manage the new fleet, uh, their fleet insurance price increase, and they don't have the cash to do the down payment. True story. I, I had a, I had a guy, I don't do business with him, who called me I think three years ago to try to sell his business. And I said, look what? We're not a good fit. He called me again to try to sell his business and I said, okay, Lou, what, what is your reasoning? He said, Ken, I, I, I gotta get out. I don't have the money to, uh, to pay for my fleet insurance. And I already have a second mortgage on my house. And I said to him, you know, not to rep salt in the wound, but three years ago I said to you, you, you need to get your financial house in order and we're not a good fit because, you know, we charge for that. We, you either gotta buy our course or you gotta pay us to do it. So the lack of proactivity on the financial side of the world, uh, financial things to me has another aspect to it. Number one. I don't think people like to talk about finances and they're embarrassed about what they don't know. Number two, they think they can farm it out or outsource it, let it be someone else's problem. And I just wanna dispel the, that myth number one. Most, most of the CPAs that we run into, with the exception of one out of 300 companies, the exception of one, this one woman in California just happens to be in wine country. This, this, this, fractional CPA took it upon her herself to learn the metrics the healthy metrics of the business by going back and looking and saying, wait a minute, four years ago our fuel was this, five years ago our fleet insurance was that. And we had, okay, but, uh, but she's the only CPA. She has other clients, but this is the only one she had in this business. And I always say to people, your CPA's job is not to know the financial metrics of the transportation industry. Okay? Their job is to, is to tell you how much tax you owe. Okay? If they're really good, they will start telling you tax planning. So around, let to me, let me give you the financial planning basics. Number one is to know how much cash you should have in the bank. Cash liquidity. I'm gonna give you one number. If you are a million dollar operator, you should have no more than $300,000 in long-term debt on your fleet. You should have no debt on a million dollar business with the exception of the fleet assets. Second number, if you're a million dollar company, you should have the equivalent of three months of your base expenses. In liquid cash available. Not a line of credit. Liquid cash. So what does that mean? The g and a of a business, the overhead of a million dollar business is about $250,000 a year. Right. Plus your fleet, all your fleet payments. So to keep the business open, you need to have three months of your overhead. Okay. Because even if the drivers, you know, are calling and saying there's no work, you don't have to pay them if, you know, if you lay them off, you still have to keep the business running. So three months of basic expenses, your

James Blain 55:43

real quick before, before you go into what's covered, right? Because I know I can hear it already, right? I, I get to hear the operator saying it. Ken, you want me to put all that money in there in cash, not making me any money just sitting there like, shouldn't I invest it? Shouldn't I have it somewhere I can make money on that? Money should I mean cash? Are

Ken Lucci 56:03

good. Good question. So, good question. I'm gonna give you the opposite. I mean, I'm dealing with an operator the other day who has several million dollars sitting in the bank and I'm like, dude, can we please put this into some short term investment? Here's the key with cash liquidity. Here's the key with the liquidity. You gotta be able to get to it in a reasonable timeframe wi within an emergency. When you look back at the pandemic, the companies that didn't make it through the first 120 days and they had to liquidate fleet, were cash poor. Okay?

James Blain 56:37

Yeah.

Ken Lucci 56:38

And I can, I can call some people out, but I won't 'cause they're dead soldiers and they're not in business anymore. But if you look at the first 120 days, there was a very prominent operator in Connecticut that went outta business because he owed another operator so much money. Okay. He basically had to make a deal with 'em to take over the business, which was dead. I mean, the business, the business didn't return. I mean, uh, maybe a third of it returned after the pandemic, but, but that was catastrophic. And, and the other thing I'm gonna hear is, well, that's never gonna happen again. Let me tell you something, and this is gonna intersect with your world, okay? You have a catastrophic accident. I don't care. I've never seen a business that didn't have a catastrophic accident where the results were consuming of the business. Business dipped. After that, you had to put down money to pay, to rebuild the vehicle. You had to buy, in certain cases, you had to hire a lawyer. In other cases, obviously you had to, you had to replace the vehicle. Okay? But it's something about when that ca catastrophic accident happens, okay? I mean. It, it, in some cases, it literally can be the death nail of the business, but think of cash liquidity as it, it, it is, it is literally like Popeye's spinach. Okay? If, if you are a weakling, you don't have any cash, if any blip in this, in blip comes up on the radar, you are not gonna be able to survive it. The fleet insurance is the one that is interesting to me because no offense if you own a business and you can't come up with 50,000 in cash, okay, without a line of credit or putting a second mortgage on your house, what are you in business for? If, if, right?

James Blain 58:29

there's more to it than that, right? Because we, we spent half a podcast talking about proactive. I am so tired, right? This happens to me all the time. Hey, I got my renewal coming up. How fast can we train my entire team on a year's worth of training? I haven't done. Do you think the insurance company's stupid? Right? One, if You do it, they're gonna know And two, you should have done that all year long. And then when it's time to do your renewal, you need to present yourself, right? You need to put your portfolio of, this is our safety portfolio, here's our training, here's our telematics, here's how we're spending time

Ken Lucci 59:06

Here's our annual report. Here's our annual safety report. You know, we, we are ble, we're blessed. Coming up on another podcast, we're gonna have one of the, one of the brightest guys, most successful guys in the insurance industry. Tim Delaney from Lancer and, okay. And you know, Tim, one of the things that gets me about Tim is he's a gentleman. Okay? But I can tell you right now, if he was less of a gentleman, he would say, flat out, we have been saying to you guys for years, you need to do this stuff. Okay? And now what's happened? All of the insurance industry forces, uh, the, the cost of the cost of reinsurance, the, the commercial losses, the nuclear verdicts, they've all come home to roost.

James Blain 59:56

It is a storm. It's a storm of all of them together.

Ken Lucci 59:59

correct, so if you listened to the proactivity that they were preaching, you'd be in good shape. I know one large operator, it's a $90 million operator who got an insurance decrease. Do you know why he blew away his insurance company with what you just talked about? His safety portfolio. Okay. He did a full on presentation of how safe his business were, was coupled with the lo loss runs. It, it, it ended well. Okay. Yeah. Here are my loss runs, but let me show you my program. So anyway, from a proactivity perspective on financials, you should be prepared. To show a, be a lender or to show a potential buyer or a seller that you are financially viable either to borrow, to buy a piece of equipment or to borrow to buy a company, or you've got your financial stuff in order to sell. So another story, and I know we're running up on time. Guy calls me, love this guy, guy's in, guy's in the Southern city. He calls me and I would take, take his phone call if I was on Mars. He's like, Ken, I got a company I wanna buy. I'm like, I am, I'm thrilled to work with you. Okay. He said, but I'm going on a trip. I said, I got it. Don't worry about it. I'll talk, I'll, I'll handle it. So he gives me the buyer's information and I con, he connects us by email. He gives us the seller information. I connect by email and the seller says, listen, I've got a business broker. Okay. That was four weeks ago. We still have not gotten any data. I've called the business broker. Okay?

James Blain 1:01:43

Okay.

Ken Lucci 1:01:43

This is a guy that, the, the seller is a guy that I admire, and he's been in business for 30 years and he's decided to sell his business. And he's using a guy that's a part-time business broker who sells, also sells real estate. And I said to the broker, I mean, didn't you prep this guy? Did you do a valuation? No. And I, and I said to myself, Ken, you are working for the buyer. Just tell him what you need. I gave him a list of what I need and he said, oh, this is very helpful. I, the broker said that to me. So proactivity on the finance side is, is totally having your house in order, having the capital set aside. Let's start with, did you end the month with more money than you began it after all your bills are paid? If the answer is no. You need to come visit driving transactions. If you don't have a proactive safety program and you are facing an insurance renewal, I don't care if you're just renewed and you're not happy with the increase, that should tell you. You need to talk to James so that next year you're get proactive now and be ready next year. Oh, so listen, this is a, this is an hour that's gone by. real fast. I love the fact that we took the proactivity and we weaved it through those three things. We could spend so much more time on proactivity. and I appreciate you being here. I've really missed you. You've been on the road. I know I see you on Facebook at every single association meeting out there. I wish I was as young as and aggressive as you. God, God love you.

James Blain 1:03:22

I, I, I wish, I wish I was younger. I could be at more of 'em, but, but at a certain point

Ken Lucci 1:03:28

Listen, you, you're all over the country. That's, I mean, you are, you are literally like, there's two or three of you. So thank you very much for everybody for tuning into another exciting episode of the Ground Transportation Podcast. If you've got any questions, email us. If you'd like any subject discussed, shoot us an email. And James, it's been a pleasure. I love it when, uh, a plan comes together and we can co-host

James Blain 1:03:53

it is always a pleasure. And if you guys haven't already, like, subscribe, comment, let us know you're listening. Let us know what do you want to hear us talk about? Who do you wanna hear us talk to? And thank you again for listening to the Ground Train Station podcast. Ken, it's been a pleasure my friend.

Ken Lucci 1:04:11

my pleasure. I.

1:04:13

Thank you for listening to the ground transportation podcast. If you enjoyed this episode, please remember to subscribe to the show on apple, Spotify, YouTube, or wherever you get your podcasts. For more information about PAX training and to contact James, go to PAX training.com. And for more information about driving transactions and to contact Ken, Go to driving transactions.com. We'll see you next time on the ground transportation podcast.