I lost $4000 on a door and it was my fault.
We all make mistakes. Sometimes they are costly and sometimes they painful. As someone that prides themselves on dotting their I’s, crossing their T’s, and patiently planning, you can probably imagine the wave of horror that washes over you as the reality of your mistake and its costs set in.
Back when I had a 9-5 gig, I was working for a Fortune 500 company in the unenviable position of being to blame for a significant part of the ‘07-’08 financial crisis, Standard & Poor’s. One day, as I sat at my desk watching the markets crashing on my terminal, it had become clear that another division of our company had been handing our AAA bond ratings to anyone willing to write a check. This was a time in financial markets when the banks could just pay ratings agencies for AAA ratings on their mortgage-backed securities. That same day, I was eating lunch with my managing director when the topic of our company’s rating inflation came up. Her responses was priceless “Not my circus, not my monkeys”
The idiom is a translation of a polish proverb “Nie mój cyrk, nie moje małpy,” used to convey the idea of settings boundaries and not getting involved in matters that don’t concern you. At most jobs, this attitude is part of the training, stay in your lane. This mode of thinking is hard to break out of and is the exact opposite of successful property investing. If you are investing in real estate with a hands-on attitude, you own the circus, you own the monkeys, and it’s all on you.
In the end, it did not matter that an architect created the specification for the door, it did not matter that I had come to the store three times to verify the order, and worst of all, it did not matter that the door cost $12,000. The buck stops here. Somewhere along the line, I let down my guard, I deviated from the process. I lulled myself into the comfort that other professionals would be vigilant on my behalf and that they wouldn’t make mistakes.
As part of a project to replace the windows and doors on an apartment in an 1860’s Brooklyn apartment building, custom millwork was ordered. This apartment is blessed with six 8’x2’ windows and a 9’x4’ French door. Big orders like this are expensive, this one clocked in at nearly $20,000, almost half of which was the door. This order would retail at almost $30,000, but major home improvement retailor (Home Depot & Lowes) have a Pro Desk where you can submit large buys to bid. In this case, the bid came in 28% below the retail price. Sounds like ‘Pro’ is some special status. It isn’t, just give them your email, and you are a ‘Pro’ eligible to participate. So in essence, if you give them your email and simply ask, they’ll knock thousands off the price. Bigger orders get bidder discounts.
With the architect’s specifications in hand, I had gone to Lowes to work with a millwork team member to put together my first order. It was a weekday evening, so when we were done an I wanted to submit my order to the bid room, I was told “only a specialist can do that. You’ll need to come back.” This was where I began to lose discipline. The more people touch an order, the more chance for a mistake. So, as requested, I came back the next day to submit my order. Working with the specialist, a number of questions came up that made me hesitant pulling the trigger. I wanted to double check everything.
I returned the next day having checked my measurement for at least the fifth time. This was going to be the day. I have gone through the whole process, my order was in the system, and it was time to pull the trigger and spend $25,000. Now, all there was left to do was wait. My project had not even started going yet, but since I knew it would take three months to get delivery, I was on top of the schedule and the budget.
After three months, we were well on our way with our construction project. I got a call from Lowes that the door and windows had arrived. I got my contractor and a couple of his crew together and we went to pick up our order. We loaded it up into the truck and headed to the job site. The next day, I begin the unboxing process. I remove all of the timber frames and the pallets only to be struck by a sinking feeling when my eyes first set on the door. It had a giant divider in the center, WTF?
Turns out the door I custom ordered only had one operating side. That meant I did not have a Frech door, I had a bid ugly narrow door next to a big ugly fixed window. I felt that feeling in your stomach you get when you know the shit just hit the fan. Returning custom ordered millwork is expensive. I was determined to get to the bottom of this.
After spending a few hours at Lowes talking to the employees that had put together the order, I found the mistake. Mill work specifications created at big box store contain a front elevation of the ordered product. For doors, there is a very thin triangular line that indicates the door is operational and the direction of opening. If the lines are on both doors in the order, both will open, if there is no line, one door will be fixed. I had somehow missed one thin line on a specification. Since the order is keyed-in by an employee of the store, they are the source of the error. None the less, I should have double checked their work. I didn’t, so now it’s my circus and my monkeys.
In the end, I had to pay a restocking fee. What’s worse, since my order didn’t include the windows that had accompanied my first order, I got a smaller discount when I sent the order to the bid desk. In all, this door cost $4000 more than it should. Like paying for college tuition, mistakes are an expensive way to gain wisdom. Losing money is a lot less painful when it teaches you lessons that will save you much more than you lost.
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