Quote:
Originally Posted by patrickt
Well, I don't know enough about the engine building business to know how far you can successfully "hedge your risk." You know a certain percentage of a certain type of build will incur problems. If you hedged all of those builds, with a surcharge, that charge, combined, could cover the costs of fixing the occasional crapper. That's how you do it in most markets. But from a business perspective, you don't turn down business. Instead, adopt this mantra: If you throw enough money at me, I will do it. I might not succeed, but I will do it.
EDIT: and more often than not, you will succeed. |
Engine building doesn't have actuarial tables with thousands of customers ranging from the age of 1-100. Nothing wrong with managing risk as a business person. If alloy blocks have issues and cause Brent warranty problems, and he'll sleep better at night, then I have no problem telling customers that he won't build any more engines with alloy blocks until further notice. He'll suffer a loss of business, but then he's backed up anyway.
These engines are $20,000-ish +/-, so having a few go bad, could bankrupt a person.