Masonry Magazine May 1962 Page. 5
By Ralph B. Rogers
President
Tezas Industries, Inc.
Financing For The Mason Contractor
The highlights of the 1962 MCAA Convention at Eaton, Texas, was the presentation by Mr. Ralph E. Tuesday morning, February 13th, on Financing. Due to the many requests for his speech, Masonry has provided, during the past months, the entire series. A Special Report on this series of articles will be made available to all MCAA members in the near future.
PART III
We are going to get just a little bit more complicated, but not too much so. You all know what a profit and loss statement looks like. Have you ever projected a profit and loss statement a month, two months, three months, six months or a year in advance? It's easy. It's a cinch. Have you ever made a careful projection a month, two months, three months, six months, a year in advance? It's easy. It's a cinch. There's nothing to it. You use exactly the same form as you use for your profit and loss statement and your estimates, and you know what you are going to do.
You are going to say, "it isn't going to come out that way." O. K., it isn't going to come out that way, but I'll know, after you have been doing it a year or two, I'll make you a bet that you can be accurate within three percent. And how would you like to read your balance sheet and your profit and loss statement for 1964 or 1963 now? How would you like to be sitting here and know what that profit and loss statement was going to look like a year or two years from today? There's nothing to it. If your projections are inaccurate by five or ten percent, they will tell you things today that you are going to be a lot better off knowing now than you will a year from today or two years from today. And anyone who says it can't be done in the contracting business just doesn't know what he is talking about. There are men in this room whom we have taught how to project their profit and loss statements and cash flow and their balance sheet as much as a year to two years ahead, and they didn't have any business experience at all when they went into business. The accuracy is absolutely amazing, and the things that they do to keep from doing the wrong thing a year or three months or two weeks in advance, things they can't do after it's too late, has made the difference, in some very tough times with some very tough competition, between surviving and going out of business, as a great many of our friends have done.
Don't ever kid yourself that the fellows who go out of business may not be just as good technicians as you are. Ninety per cent of the people in your business who go out of business do not go out of business because of the loss of volume of business. They go out of business because they weren't good business men. And to be a good business man is a hell of a lot easier than being a good bricklayer. It's a cinch. And you will love these figures; they' they're not boring. They'll just really fascinate you. And they are not difficult to get, and you don't need a lot of expensive systems.
But while we are talking about expensive systems, you show me a man in business who says, "I can't afford to hire a good bookkeeper" or "I can't afford to keep these systems or these notions," or "I can't afford to have a good accountant," and I'll show you a man who isn't going to be in business successfully, and I make that statement without any hesitancy. He will come a-cropper one day, and he will not be successful in business until he learns that the money he spends on his figures is the best investment, the very best investment, he can make. It guarantees peace of mind you never want for money, because you always know what you are entitled to, and you always know what you can get, and from whom you can get it. With a proper projection; with the ability to show to your sources of money that your previous projections have been accurate or inaccurate within a certain percentage; with a proper cash flow, the sources of money are delighted to talk to you. At this point I think we might interject that money is a commodity, just the same as bricks or blocks. Money is looking for a market, just as you are looking for a market for your services. The difference between money and other commodities is that the people, generally, who handle money scare easily. But I tell you, if they have confidence in you, they will come to you with wheelbarrows full of it, and try to get you to take it, just as if they lose their confidence, they'll pull the rug out from under you and run for shelter like a bunch of scared rabbits.
Now we get to methods of financing and sources of money. As you might expect, methods of financing and (Continued on раде 6)
"THE AUTHOR-Ralph B. Rogers
is President and Chief Executive Officer for Texas Industries, Inc. He has been the head of this firm and its twenty-five affiliated companies since 1950. Under Mr. Rogers' guidance, Tezas Industries, Inc., has grown from a company having $356,000 in assets in 1950 to one in excess of $25,000,000 today. Tezas Industries is understood to be the first vertically integrated concrete company in the United States which mines and processes its own raw material and with those raw materials manufacturers and delivers concrete in various forms.