“I try not to think about them,” Gene continued. “We have fifty trucks, they have six trucks in this market. Worse part, they are taking work for way less than us. Sometimes, I think they aren’t here to make money. I think they are here just to make us look like bad guys.”

“So, they are taking work at a lower price to the customer?” I asked.

“Yeah, sometimes, it’s lower than what it costs me. They are buying the work.”

“Let’s look at a couple of things, Gene. First, they don’t have an office over here?”

“No.”

“They don’t have an office over here, so they are using their dispatch people in their home office, using Google maps or something. They are billing people using either credit cards or invoicing from their home office, sending the invoice by fax, email or snail mail.

“They aren’t competing in the Yellow Pages, only on the internet, so their hard advertising costs are less. Gene, I don’t think they are working on a lower margin than you. I think they have figured out a lower cost structure. In fact, even with a lower price to the customer, they may be making more money than you.” -TF