Friday, June 28, 2013

The Bu$$ine$$ of Horseshoeing -- Part 3.

The Drama Continues... 
The Bu$$ine$$ of Horseshoeing -- Part 3:





[image: Sandra Mesrine]
[Wild disclaimer #3:  Just a reminder that this article was first published in Anvil Magazine, circa 1987.  Some could view it as a White Paper written perhaps out of either frustration or from the depths of a bottle.  Maybe both.  After almost 20 years in the most convoluted business ever dreamed up, it seemed a good time to murder a few sacred cows.  It wasn't a matter of the model simply being broken.  Instead it was a case of an industry-wide chronic form of rampant denial, delusional thinking, culminating in a great deceit -- the lack of light in the room -- that was destroying people's dreams, lives and futures.  But oddly too, it contained love as well.  For a trade, for the horse...a lifestyle far from the common.  But the latter can never be the sole sustenance.  Never has been, never will.  Just three years after publishing this tome, and many others like it, the business bit me in the ass.  And I got a good view of just how deep the wound can be.  More than anything, these articles are about taking care of the quarterback.  Because if you go down, your team goes down with you.  And that is the stark truth wound around that analogy.  Because in spite of all your vast skills, your investment in time and energy; your good will and warranted optimism...the business, the core of this adventure is always five-minutes to midnight...and counting.] 

Associations, etc.:  Organizations need to better embrace the concept that representing their constituency entails a certain degree of responsibility towards its membership -- something beyond dues and lip service.  No more than 10% of available time and resources should be devoted by organizational leadership to what the public may or may not think.  What?  Yes.  Organizations that represent a distinct trade (i. e., a lobby), should only be concerned with the public in a reactionary fashion -- after the fact.  Opening dialogue through a defensive posture will crack the bounds of credibility and lead to the presumption that the organization lacks direction -- which is probably more accurate that we'd care to admit.  Sure, the public relations game, which means control the outside message and deal with the internal issues, because if your members continue to be marginalized in the real world...public reaction or the need for an association become moot issues.  And yes...I know the audience. I'd rather dress in black face and book a performance in South Africa.

Confused?  Well, there is vast difference between internal and external agendas in such groups, as in who pays the dues for the affiliation versus who then pays the actual members.  The blade cuts on both sides.  The issue of a mission statement -- clear and concise -- may have a larger altruistic angle;  say the betterment of Fluffy's life in general.  However, the clear work, where the heavy lifting lives is how you both market an association as a whole, and truly benefit your members in the process, having no illusions about where your loyalties belong.  And in the end, one supports the other.  In a perfect world, which we fail to live in.

Here, the specter of money raises its unattractive head once more.  As an example, access to affordable health or disability insurance -- those mainstream benefits we hear about, but rarely see, are a plague upon the self-employed, perhaps more so in the horse world than elsewhere.  Grooms, exercise riders, muckers, trainers...catch riders and yes, even veterinarians trying to open a new practice, face this continuing challenge for access to affordable health care.  And farriers are not immune to the difficulties here or the dangers of all who work with horses.   And as independent contractors, we collectively fall either below (or $$ above ), all such state or federal programs designed as a parachute for injured or disabled workers, not business proprietors.  Oddly, it is not a lack of effort on the part of some associations.  This was explored at great length during the formation of the AFA and various state associations -- this notion of negotiating access through the power of numbers.  And all such efforts wasted away.  Why?  Because you couldn't even get farriers to maintain their dues, much less support the adjunct benefits being offered.  This too, complicated by the reluctance of many to operate a legal business -- meaning that a line exists between what the IRS considers a hobby and what they consider a viable business.  So the failing, if one exists is ours.  There is no reason that a trade association cannot gain sufficient strength to then join with similar industry groups -- with similar needs -- and negotiate a workable deal.  But first, the internal pissing, moaning and back-biting has to end.  And just maybe, the Pope and all his Bishops sent back to the Vatican where they belong.  You might be the boss (Congratulations!) but in many cases you're also the staff.  And I've got news....the hospital isn't interested in your independent spirit and initiative -- and they hold no shyness about repossessing your house.  This country is often referred to as "the land of opportunity;" and it is -- until you stumble.  Then it will toss you aside like a rabid bat.

Publications:   Trade rags always need to share a common philosophy with both their readers and the organizations that may share their space. They also have a minimal responsibility to commerce with the truth.  [Note: This refers to earlier years when publications like The American Farrier's Journal shared an affiliation -- better yet, a contract with the American Farriers Association in an official capacity.  While necessary in the early years as a 'voice,' this action was precipitated by the difficulties and expenses of a start-up organization attempting this task independently.  However, as could be expected, it quickly became both polarized and politically divisive -- and not really by intent.  Now in case nobody has noticed, advertisers control content nowadays, not the editor.  And by default, the AFA contract became the biggest advertiser in the AFJ.  They represented the paper and ink in the deal.  Not a negative,  except that it exceeded what should have been a simple housekeeping arrangement.  (Oh, "commerce with the truth?"  I think we all can conclude that by 2013 "the truth" has escaped the bounds of all media.)]

[The conflict issues surfaced because like any young organization, the AFA was wearing rose-colored glasses in an effort to gain traction and attract members simultaneously.  The hard issues were ignored in favor of contests, back-slapping.  Any attempt at bringing up the difficult stuff...the meat in the stew, was not only suppressed, but the source openly attacked.  That is where the Anvil Magazine and a few of us malcontents joined forces.  And yes we paid a price for it.  Worse yet, we failed in the message...or really, the farriers failed to hear us.  But then, that is water under an ancient bridge, except that the issues remain like an open sore that won't heal.  And today, the 'safe' road remains the mantra -- the perfect clip, fifteen ways to cure a migrating bog spavin, arguing over the origins of the French hind.  Nero fiddling away a quiet afternoon while Rome continues to smolders.]

To continue...

"No worries, that's just Bob's working
 on a roadster again!"
  Over time, article content has suffered as well.  Horseshoeing has probably been examined to death, in a never-ending search for the Holy Grail of Hoofology:  the mechanics of a physiology that defies both carpenter and mathematician.  As I stated earlier, Newton trying vainly to quantify the existence of God in his time.  This has presented itself in the form of high-tech, abstract and somewhat delusional approaches to farriery, many that involve endless measurements, graphs, charts, invented inverted) language, remedial know, "the dorsal wingnut of the ventricula apparati of the oppositional tricupidal of the orbital circumpedi."  Yeah, that was it.  Maybe.  And no, it is not meant to be critical of research, personal study or the pursuit of knowledge -- or for that matter a common language.  Sure, self-inflating value to the author or clinician, but it rarely trickles down to anything of fundamental value in the field, and by encourages a territorial infringement on the veterinarian's turf.  Which is certainly fine since many farriers consider veterinarians one-step removed from the idiot house anyway...and very often say so publicly.  However, most vets choose to remain gracious in the exchange -- the result of a higher education, which teaches communication, politics, ethics, good well as medicine, allowing them to float above the fray -- to a point.  So, feel free to jump in the pond.  Just make sure your lawyer can swim.

[The key point here is an arrow pointed straight back to the educational process of most farriers, which is, by accepted standards: remedial in nature.  America's obsession with the fast lane, the devaluing of academic standards and pursuits in all facets of education not only affects the current student, but the potential one as well.  Inner-city kids know this equation well:  "Get my GED, go to college...or sell crack cocaine on the corner and drive a Beamer?  Hmm."  So the message is fairly clear.  If you want to play in the pond with those that invested heavily in their education and credentials...then the educational system for farriers must create a suitable format and the student must be willing to invest in the process.]         

At the extreme end of this lies the road of self-selling madness, where the assumption arises that a clinician (or author), spends two-hours evaluating Fluffy, two hours shoeing her and three days answering questions on the Today Show, before stopping off to pick up the Pulitzer.  This form of promotion, when it ricochets into the public spotlight, simply raises client expectations that can't possibly be fulfilled, while lowering productivity at the farrier's personal expense.  At this stage of the game, the average horseshoer cannot afford to look that smart.  He's been priced out of reason by the rolling propaganda machine; one that prefers words over actions.  And throughout this dog and pony show approach to shoeing, the horse is somehow got lost in all the noise.

IRS Form 1040EZ...
for farriers.
How the average business appears to function:  [Please note, 1980's figures and merely vague medians.]  The average horseshoer in the United States earns approximately $5.49 per hour as a wage.  On a yearly scale, the average business will consume $40k to makes $20k, or simply put, out of that $40k, $20k might be profit -- or truck payments.  Always hard to tell in this business.  This is based on an average fee of $45-60 per horse, 6 to 7 a day.  And these figures are not meant to bowl anyone over with accuracy -- the truth is that nobody knows anyway.  No industry surveys, standards or polls have ever been conducted and since the trade is not recognized by the US Department of Labor, or overly familiar with the truth -- who in the hell really knows anyway?  So it is like they spout around the Jersey waterfront:  "If the books ain't cooked, the cook is booked."  Which is nothing new.  If the IRS had any logic left in the building, they would just reduce the taxes on the self-employed by 5 points.  Because we're going to keep it anyway.

Most farriers tend to keep their business ledger in their wallet.  The old system of "six a days is what they pay."  The problem with these creative approaches to accounting is that the number of horses shod per day, or the amount of money that hits the denim cash register at the end of the week is not profit.  This is what is known as "gross" pay.  Some days, "gross" being the operative term.  And no, you don't get to keep this part.

To get an idea of who does to get keep most of it, examine the following yearly expenses broken down into daily rates.  Again, mere averages:  The yearly phone bill may equate to $1.70 per day; wear and tear on rasps at $2.30 per day, probably less if they are used until the teeth are missing; depreciation on power equipment, (drills, grinders, coffee machines), $1.46 a day.  Vehicle expenses, $12.00 per day, dependent on mileage, LESS fuel.  The '73 oil embargo making that prediction more difficult than the odds on roulette. [Noting here the lesson in supply and demand in the marketplace: OPEC.  So, you say the consumer can't bear it?  Uh, huh.]  Something as small as your checking account: $.45 a day.  Add onto that the daily value of office equipment and supplies, health insurance (What's that?), auto insurance, disability considerations, if any; state taxes, materials, dues, publications, clinics, propane, post office fees, federal taxes and of course, your lunch.  And while you are musing over the math, consider that you are in the business of selling a service -- meaning that you may be able to deduct all those supplies you bought last year, but without your labor; your skill, they offer no profit value on their own.  That is known in other circles as the maintenance of capital -- meaning they are dead weight until they hit the horse.   

Do remember to gas the truck every morning and consider those hours spent in the office trying to find all those checks that were supposedly in the mail.  Those checks are best defined as negative cash flow -- not only are they not on the books, but the cash value is depreciating every day that the post office can't seem to locate them. That is money that could be earning interest or converted to rolling stock...the area where depreciation really belongs.  So, subtract all this nonsense from the gross, add in the unexpected (you just blew a head gasket) and the remainder is called profit.  And that is without all the other, myriad demands of life.  What you really have to work with...including the distant tuition for the kids and what is becoming an evasive retirement.  And if you do mange to retire, what will those years of business bring on the open market: air and good faith.  Since you have spent your life personalizing a business, the investment is not recoverable at the end.  So you better pluck the chicken now, not later.

Somewhere in here, stupid must
be covered...

Quite a few farriers miss these rather elementary points in basic accounting, particularly the aspiring farrier who is too madly in love with the amount of chrome on a journeyman's truck.  They see a lifestyle, a progressive skill -- one without management, structure, bosses -- not realizing that you trade one boss for many -- but still making the leap to lucrative seem a short hop. Little like outsmarting a cop's radar trap.  Sure, it is a fine thing for a young Turk on the immutable quest -- five-years later, a pettifogger's  dream.  But even so, some individuals continue to believe that it is cheaper to lose money without
accounting than with it.  As if there is some divine right upheld through fiscal suicide..."the right to bear someone else's burden?" 

So without a substantive effort in accurately accounting a farrier's business, or for that matter, any business, it is totally impossible to ascertain the financial condition, evaluate the adjustments that may be necessary, or pay for dinner.  In a society founded on the assumption that money is both fun and a determinant of real value, relevant figures as a guide are extremely fundamental in whatever future you might envision.

Coming (finally), the Conclusion.






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