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Pharmacist Rudy Dajie discusses his love of growing existing businesses.
Speech to text:
Mike Koelzer, Host: [00:00:25] Rudy for those that haven't come across you online, introduce yourself and tell our listeners what we're going to talk about today. My
Rudy Dajie, Pharmacist: name's Rudy Dajie. I'm a PharmD, and today I think we're going to talk about businesses that are existing. So not just going in and starting up from scratch, but walking into a business or buying a business and what you can do differently to grow that business.
Mike Koelzer, Host: I always thought the business that I would buy is what I would do if I would drive around town. I'd find out where the business owners live. Then I would see if they're in a decent enough house in a decent enough car, and I'd maybe do the Zillow stuff, you know, and I'm not saying I do this. This is what I would do.
I would do the Zillow thing and maybe try to find out how much if their house is right side up, how much money they owe. I don't know if you can find all that stuff out and then see if the business was. Not up to my standards of what I would do, not up to the standard of my ideas, you know, dirty carpet and dirty windows and you know, that kind of stuff.
Then I would say, oh, they're making a profit. Then I'd go in and buy it and then make a bigger profit. It must not be a good plan because I'd never done it. But that's the idea I would have.
Rudy Dajie, Pharmacist: I mean, I don't think that's a bad plan. I mean, I'm not sure about the whole Zillow stocking thing, but, um, I think that that should sort of be your thought process when you go buy a business.
When I, when I look at businesses, um, and I think it's across and anything that you do, because I think all of the things I do are a business and they're just different businesses. So whether I'm looking at buying a commercial property or I'm looking at buying a pharmacy or coming in and helping somebody with an established pharmacy, um, Looking at all those different things like, oh, how is the carpet and what are their cost of goods and what is their revenue and what do they do really well and what do they not do really well?
And how are they overly diversified? Is there something that they're doing that's really profitable and they should look at doing more of that. And then you look at that, you know, sort of your, their expenses. And then you look at things like, is this being done out of convenience? Is their business being run out of convenience for their lifestyle or is their business being run to be competitive?
So if the CVS across the street closes at nine o'clock, but you want to close at six because that's convenient for your lifestyle. Well, then you should understand that there's a sacrifice there, whether you see it or not, you don't know the business that you could potentially be losing or the convenience out of convenience for yourself.
People may not be telling you, or you may not see it. I see that a lot too with business owners is that they, they structure the business around with their lifestyle needs are, and, you know, I mean the businesses will child, you know, you, you have to, it's a living growing thing that you have to really put a lot into and you sort of put in what you get, you know, you, you get out what you put in, uh, in, in sort of raising and nurturing that child.
Then, you know, I think a lot of folks are like that, and I really want a work-life balance. And I think you can work towards work-life balance. But I think when you initially start something, the balance is more towards work and you really have to focus on that if you really want to grow that business and be successful.
So.
Mike Koelzer, Host: It seems profitable to go into a business that you can see needs work, but I suppose there are some businesses that you look at and you can't think of how you would run it better. You know, there's, that's good hours. It's a good location, everything looks good. They're just not bringing in enough profit on those.
You know, it seems I would kind of scratch my head and say, well, what can I do more or better? Because it seems as fine as they can
Rudy Dajie, Pharmacist: be. That is a challenge. Right. And then I think that's where you're, you're probably gonna pay a premium for that business. Right. Because, uh, and you're not going to have a tremendous amount of upside, but you're going to buy stability.
Right. So it's like, it's, it's, you know, it's by. It's like buying a building that, you know, is a 5% cap. That's got a McDonald's in it in a 30 year lease. Well, you know that for the next 30 years, you're pretty much guaranteed that you're going to get that rent. Um, but you're not going to have a lot of appreciation and you're not going to really have tremendous upside, but it's almost like buying a bond.
Right. So you're really buying a bond at that point. Um, and you know, you have stability, so it's kind of like a business that's sort of capped out would, would look like to me. And, um, I mean, I would obviously try to find any business, like, how do I grow it? How do I get more out of it? [00:05:25] Um, but to your point.
Yeah. Um, but yeah, for me, I always try to look at something and say, is there upside? And that's generally where I look for value in a business that's underperforming, but I can easily see what I could do to make it perform. Um, and then, then you obviously know that there's upsides. You know, $5 million for that business and it's, you know, barely break even business, but you can see that you can add 10% and you know, the businesses doing 10, 10 million in revenue, but you know that you can add another million dollars in EBITDA by just doing a few different things.
I think that's sort of the smart approach to looking at opportunities.
Mike Koelzer, Host: Do you feel you can get all of that from the books that they're going to show you or do you not trust those or even if you trusted them? What other things do you need to look at besides just the numbers that the current owner gives to you?
If you're interested in the business?
Rudy Dajie, Pharmacist: No, I think you got to feel good to get a feel for tonight. I think you'd asked a lot of questions, for example, you know, are they, you know, say they're servicing, you know, a nursing home ask questions like, well, do you service the entire nursing home? Oh, no, there's actually, you know, we only service like 30%.
There's multiple pharmacies in there, you know? Okay. Well, why don't you serve us all it? Like, why don't you have all of the beds? Right? So like that's an easy win. It's the same amount of deliveries, just more, more business. So like, like, I think you have. Kick over stones and really dig into things and ask lots of questions.
Mike Koelzer, Host: That might be a case too, where it's not an upside, it's a downside. They might say, well, we used to have 100%, but now we're down to 30 because this new such and such came in. So I think it tells a lot, probably both ways.
Rudy Dajie, Pharmacist: Right, right. Then you could also look at and say, all right, well, if I buy this business, now that I'm actually probably going to have erosion of what's already existing, right.
Or you can make some assumptions. I think a lot of forecasting assumptions go into things that I look at and I try to sort of be thoughtful about them. Um, and you know, I would say I'm like a very much obsessive, um, when I'm interested in a business or if I'm going to help somebody develop a business or grow their business, I, you know, before I even meet with them, I'll have pages upon pages of thoughts, ideas, notes, questions, things that could be done potentially to better their business.
Um, Especially after even like looking at the P and L or looking for things within the P and L, but then also asking about bed counts or, you know, if you have, if you have an agency, you don't have all the agency or, you know, there, you know, do you do DME? Is it not? Is it, does it make sense to do DME? Are you losing an opportunity?
How are they using another pharmacy that does DME? So you've lost that, that business. I think that you just have to think about what the upside and downside opportunities are. I think a lot of people are very shortsighted in their business model because I would deliver three hours one way. And sometimes I was delivering a doc, you say, and people are like, well, that's crazy, man.
Like, how are you going to make any money doing that? And I'm like, well, it's not about that one delivery. It's about the fact that I'm going to cycle all these medications over. And we're going to deliver a lot of medications to this facility, but you can't make money. You don't necessarily have to look at the big picture and you don't always make money every single time for every single thing.
Mike Koelzer, Host: When you're talking to me, I'm just going to call it an owner. You know, someone that you're buying something from, give her pick up that they're lying. And what protects you from that? Anything,
Rudy Dajie, Pharmacist: I think there are many variations of the truth. So I don't necessarily think that people are like a purposely line, but consider that they're trying to sell you their business.
Right. So they're not going to always tell you the good, bad and the ugly. Um, they're going to spend a lot of time talking about the good, just like if you were trying to sell somebody your car. Um, but I think you have to be, um, shrewd enough to ask the questions and then sift through the information and then ask for more information.
You know, when I, when I bought my business, I asked for lots and lots of information and I, and I took a lot of time in. In digesting that and making decisions or making the decision that it was the right business for me to buy. And I think that you have to get enough information, then you have to be comfortable in saying things like, you got to take the plunge.
If you're looking for a hundred percent of the information and you're going to look, you know, and you think there's an Oracle and you're going to know the future, um, you're never gonna make that leap. So I think you have to get comfortable enough and then be willing to take a risk. Um, and then, and then be adamant about the fact [00:10:25] that you are going to be successful, that you're willing to do whatever it takes.
And I think that, that, that, you know, if you don't give yourself an option out, um, that's a lot better than when I think people like, well, if I can't make it, I can't make it. Don't give yourself an excuse, you know, but, uh, yeah, I think that people lie to you. I mean, I'm sure I've met with owners and I'm trying to help them help their business.
And they lie to me because they don't, it's embarrassing. Right. For sometimes the things they find are embarrassing that they don't want to talk about because let's be Frank as owners in the independent environment, we kind of put up with things that other businesses, CVS, Walgreens corporations may not put up with because ultimately in the end, you know, not having that person or that person leaving or dealing with that issue is always our issue.
Right. So it has to, it has to, and then if we have to deal with their recourse and the repercussions of the issue too, so sometimes a lot of, uh, like we don't want to make those decisions or to deal with those problems. And then I'll, I'll point it out, you know? And then it's, so they sort of make excuses for those things where we make excuses for them.
What's
Mike Koelzer, Host: an example of that kind of the elephant in the room. I
Rudy Dajie, Pharmacist: mean, it could be a key
Mike Koelzer, Host: technician. That's very valuable and that's like the whole heart of the business basically. Right. But
Rudy Dajie, Pharmacist: the person's taking advantage of them or they make whatever it is or they're just not ready or they're not giving the right level of service, but they think that they're doing a great job.
So, I mean, I'm sure we've all come across that where we're sort of. Putting up with something that we don't necessarily fully agree with, but we look at it and go, well, I'm getting 80% of the good that I need, but I'm willing to put up with 27, 20% of the bat. And especially in this environment, I mean, this environment, it's tough finding staffing and people that want to work.
And in the other challenges that technicians don't, it's not their education, right. So they didn't go to school, you know, have a college degree and spend lots of money to be a pharmacy technician. So if they can, if they can go make money, more money laying bricks, like what's the reason not to, I, at my peak had, you know, 45 delivery vehicles and, you know, 90 drivers.
I could only imagine, um, in this environment trying
Mike Koelzer, Host: to staff that I don't disagree. Why would you think it's harder now than when you did it?
Rudy Dajie, Pharmacist: Yeah, I think there's a supply and demand issue. I think that there's. You know, just like we're in an inflationary environment. Compensation has been inflated tremendously as well.
And, you know, and you can start at Target for $20 an hour. Um, I think that there's just a lot more options out there. And I think that there's not a lot of people that want to work if they're in businesses where they can work remotely. And it's, I think it's pretty hard to run a pharmacy where somebody is working at home.
Um, I can't have them fill that prescription at home, um, or deliver it from their hosts. So I think we're not in an ideal environment to be competitive in those spaces. Um, and, and it's, you know, it's, it's a tough, it's a tough business, especially, um, a volume business. If you're in a volume business and your retail is so forward facing, that's tough, that's a tough business for people to be.
And, they could have other options where they don't have to interface with the public.
Mike Koelzer, Host: You, at one point in one of the businesses you owned, you had 200 employees. And as I think about what maybe you didn't like about your day, if you think back to what was the most stressful part of your life when you had that company?
For me, it's like a no-brainer. Like you just said it Mike, the 200 employees. But when you think back to the days of your business, what were the biggest stresses that you're glad you no longer have?
Rudy Dajie, Pharmacist: Well, yeah. I mean, number one is employees, right? Staffing and. Employee issues are, you know, they're vital, they're vital parts of the business.
And also one of the hardest things to manage and control in the business. When you think about all the different facets of your business that you want to control, and, and so you can't make them come in and you can't make them not quit, you can't make them not find another job. And those are all tremendous D the difficult things that you have to, um, continue to manage, right.
And somebody quits, they, you got to replace them. And it's always, always a challenge, but even, even when the staffing environment was very different, it was always sort of my number one, um, thing that kind of kept me up at night. And that, and then when somebody did call in or somebody was sick or somebody has to go on leave or maternity leave or all those things that absolutely people should go do and are deserving [00:15:25] to do, um, it would just create more stress for me to figure out like how we're in a covering and what we're gonna need to do for those things.
I've always enjoyed the people I've worked with and people I have hired in my business, but when we were smaller and it was, we had this sort of Motley crew, like the people that just got it done and we're much more aligned. And I really enjoyed working alongside those individuals sort of back in the day when I first started out.
Yeah, we have this young crew and if it was snowing and people couldn't get to work, you know, they would call me and like I had a truck and I'd pick them up and, you know, they're more than willing to come in and they have this sort of commitment. And I don't expect anybody to be anywhere near as committed to the business as I am, because obviously it's my business, but it was really nice when we had that crew of people that were really engaged.
Did you have
Mike Koelzer, Host: direct association with all of your employees or did you have like an HR middle person that you had hired at a certain
Rudy Dajie, Pharmacist: point in time? I did bring in an HR person. Uh, I mean we have bookkeepers, we had lots of folks that interface. Um, for the most part, it was like, you know, like our corporate structure was like me and everybody else.
So, so it, you know, my door was a revolving door and I always wanted it to be that way, but, you know, for good or for bad. Right. So everybody always had access and everybody was always willing to come to me. And you deal with it. Other things too, right? Like, you know, Hey, listen. Like I can't pay for my car, so I can't come to work and, you know, so can I get an advance on my check?
And I think those are all good things that we help people when we can, but they're all distractions from the business too. And, but I think when you grow your business, um, versus our already established business, you know, people grow with you, right? So you can't sort of say like, okay, well, um, when we were doing $15 million in revenue, uh, you came to me because I was the end all be all.
But you know, now that we're doing $25 million, you need to go to Susan, who's head of HR and you can't come to me with those problems. And I can't provide you with solutions. I think it's hard to do that. I think it's hard for people and I think you lose. Some credibility with people then saying like, oh, I thought we had a relationship.
We, you know, we're here for each other. And now I can't do that.
Mike Koelzer, Host: My complaint about employees always is, um, well, first of all, I don't like them and some of them are my own kids. So that doesn't fare too. Well. I just don't like the idea of employees? I always didn't like the imbalance of one of your employees who come to you and say, Rudy, I'm putting in my two week notice and.
Typically you'd reply with where are you going? And they say, well, I'm going to a different industry altogether. I don't like, you know, medicine anymore. And you say, well, congratulations on coming up with that goal for yourself. And if we can help you at all, let us know and so on. So they have that option any time.
But if you were to call Sally and say, Hey, Sally, have a seat, you're doing a good job, but we just want to change pace. Wouldn't let you go and bring and bring Bobby. And it's the same thing. You know, you both put your two weeks in or whatever. You're going to pay him two weeks and this and that, but there's the onus on the business owner to be the stable one and to, you know, always keep things going.
But if you do that to the worker, it's legal, but it's chaos. It's social chaos. Oh
Rudy Dajie, Pharmacist: yeah. I mean an employee. In this day and age truly, really have a lot of power. Right. And, um, we've created systems so that they're very protected, um, in our society screen systems and the government's grade system, so that they're very protected.
And depending on the state that you're in, they're more or less protected, but employees are very protected and then they have the social ramifications of what they can do as well. Right. I mean, you start going on and deed, or, or these are, you know, just going to Google and look at reviews. And if people leave these sort of horrible reviews about you as a boss or as a company, it will be very challenging for you to hire people because they'll see those reviews and say, you know, our glass door, even if that isn't the truth of the matter.
Um, it's almost like, you know, when you leave a review on a restaurant, you know, I mean, if that's you're gonna respond and you can always say, well, There's two sides to the story and, you know, uh, but yes, I agree. It is challenging. And if somebody isn't performing there's, [00:20:25] so there's so much onus on the business to, uh, have you done all the things possible to make a space for them to be able to perform?
I think that we live in a sort of a gig society. You know, we talk about the great resignation and I think a lot of people want to work when they want to work for however long they want to work. And generally you can't really run a business like that, you know? And then those people are all bent up when they go to Starbucks and it's closed at three, you know, because, because they don't have staffing.
You know, so, um, I don't know. I think it's an interesting time. I, you know, the pandemic forced some different evolutionary things in business, but I don't know how, I don't know how pharmacy can become remote. And I, and I, and I think obviously there could be more automation coming where. East grips are coming in and there's a robot that spits the medication out for you, that you put your ID in and put your fingerprint or eyes or whatever.
And somebody remote checks that because obviously we're already doing that. And you know, you're remotely checking prescriptions as well as the product. So, but then I think you're going to have a lot of. Legislative issues around that were boards of pharmacy, probably aren't going to get on board with that, that quickly.
But I think ultimately that's where we'll probably end up. And I think that a lot of these developments are out of necessity. Just like zoom. Wasn't really a big deal until the pandemic. And then zoom was, uh, Had it, you know, sort of moment in time. Yeah.
Mike Koelzer, Host: I hope pharmacy moves as quickly as it can technology.
And I hope that there's not, I'm not saying there is, but I'm hoping that there's not board members on the state boards that are business owners who are going to profit by slowing down technology. Somehow I might be talking differently, maybe if I was on the working side versus the ownership side, but I hope that things move along as quickly as they should.
Technology-wise well, I mean, I think
Rudy Dajie, Pharmacist: they're, they're all not very pragmatic, right? Just like ratios railing in certain states, uh, there are ratios and some states have no ratio as a pharmacist or a technician. And then, and then in some states it's. Well, if you have two certified, then you can have two non-certified in Massachusetts, right?
It's like, how did they come up with these things? Um, how did they determine that I am only capable of managing, you know, four people and if I go to, but if I go to Rhode Island, I'm capable of managing as many people as I want. Um, so I, I think that, that there just needs to be some consistency. I think there needs to be some rationale behind some of these decisions as well.
Right? Because I think they're very limiting. Um, and that was, and that was a challenge for my business. Anyway, a big box long-term care pharmacy, and didn't necessarily, certainly always need that. That ratio was, um, challenging because we needed a long haul, a lot more technicians to do the work that needed to get done than necessarily we have pharmacists.
Now you're asking the business to carry an undue burden.
Mike Koelzer, Host: You've got a love for business. If you could have done it over, would you have not gone to pharmacy school or was that a nice combination pharmacy sort of got you where you needed to be? And business was kind of on top of that.
Rudy Dajie, Pharmacist: I think I had looked at those different things.
I think I liked the security that pharmacy had offered when I was in school, but the struggle that I had when I was in school, as I wanted to do something different. And when back in 2000 and early two thousands, pharmacists really were just in a retail or a, um, hospital environment for the most part, you're in, you know, this big industry push wasn't really there.
And then, um, a buddy of mine that was a year ahead of me. The Rutgers fellowship program is like, you know, you really should do this program because right up your alley and it will get you into a space where you want to do the things that you want to do, which is do something outside of those sort of two things.
But to answer your question, I would, I don't know what the alternate ending would have been, or so I, I probably would just do what I already know. Um, worked well for me, but to your point, I love business. And I think that any business would be interesting if I didn't end up going to pharmacy school, you know, I think I would have probably built a very successful like landscaping company or something [00:25:25] else because it's just my desire and my passion just like, I'm still building business.
Um, now I'm just, I don't have to, I don't have to sprint, right, because I've had an exit. So for me now it's a little bit more enjoyable, but. Before, when I pretty much had everything on the line and borrowed a ton of money from the SBA and put everything into Hawk, um, it was more of a sprint for me versus a marathon.
Like I had to work 13, 14 hours a day, six, seven days a week, um, because I wanted the business to be successful and then I wanted to be successful. Right. There were things that I wanted to sort of accomplish for myself. So,
Mike Koelzer, Host: So right now, Rudy, you're doing some consulting and things like that. Are you ever going to, do you, are you ever going to get back into a product based business, either an information product or a tangible product?
Rudy Dajie, Pharmacist: Uh, I might get back into the pharmacy business. I've definitely seen myself entering into a space where the tangible product at some point in time, I mean, I'm invested in a number of different, um, business ventures and from an angel. I think that everything sort of has a product. I have a fairly good sized commercial real estate portfolio.
And I think that that is the product right for me. So when I look at those buildings, I look at each of those buildings as its own business, and I take the same approach to buying one of those buildings as I do and buying a business. So I look for an opportunity. It's undervalued. How do you increase Ryan?
So could we fix the building because it's undervalued because it needs some work. Can we get a discounted price because it needs some work and, um, can we build more buildings on the land that it's on? So I really look at, at any business sort of from that same fashion as like what's the upside potential and the opportunity.
And, and I mean, the reason that I enjoy the real estate piece right now is because it doesn't require a tremendous amount of labor. You know, so for this point in time that where the labor market is is difficult. Um, we outsource the majority of major projects like major construction or things that need to be done.
Um, but you know, I forgot one or two guys that work for me that manage the properties and deal with small renovations and things of that nature or tenant issues, which is a lot easier than, you know, 200 people. So I think that's what I enjoy about businesses that there isn't a tremendous amount of infrastructure from a personal standpoint.
Mike Koelzer, Host: It's always been kind of a hobby of mine to find the best processes for task management, part of that, reading on it and, and certain programs and that for task management. And I talked to my friend and my brother and things like that. I'm like, what do you use for task management? They're like nothing.
I'm like nothing. And they said, no, but we've got like one customer. It's like, oh, I've got hundreds a day. What's the difference? There's a blessing and a curse in the old days when you had a few hundred customers, whatever that you're serving every day, that was a great diversity because they were all individual players.
I'm talking back in the seventies. Now, of course it's kind of a pain because you've got the work level of, let's say a few hundred people a day that work level is there, but the pay diversity is not there because you're looking at three or four different, huge payers. So you've got the pain in the rear of multiple customer interactions.
If you look at it negatively, you got the pain in the rear of that, but it's not a diversification because you only got four players. So it's not a great situation.
Rudy Dajie, Pharmacist: No, I mean, I think it's not a great situation, but I think you still make money doing it. I think it's also not a bad situation when you're negotiating.
Your reimbursements or whoever you work with to negotiate your reimbursements. You're not having to negotiate across 12 different players.
Mike Koelzer, Host: If you twist that, the other way, the smaller number is nice, but I think negotiation is a stretch. I think you might want to say it's not as painful because you're only getting screwed by four.
You're only getting screwed by four companies instead of a dozen, but the negotiation part is not really
Rudy Dajie, Pharmacist: there. I think that there could be stronger negotiations. I think that's the other challenge too, especially on the retail front. I think that, um, in the long-term care space, I think that, um, the groups that are out there, um, MHA, Gerry med innovate, ex.
I think maybe one other, I think they do a really good job of advocating with the PBMs. You know, they do have leverage there with CMS and med D because they have to have a certain market share, uh, provided for so that, you know, they have to the, the, um, the PBMs need to [00:30:25] work with them
Mike Koelzer, Host: because they have to have so many lives have to be Medicare covered and thus they correct.
Thus, they say, if, how does that work? If you lose us, then if Carramar
Rudy Dajie, Pharmacist: doesn't contract with MHA, then they lose all those pharmacies and then they don't have a critical mass, right? So they can't go to CMS and say, we want, we can be a provider. So I think that obviously there's leverage there that we don't have in a traditional commercial environment.
But I think that there's, it's got the pendulum needs to swing back at some point, um, that we can, and I think the challenge also becomes it. Everybody's got their own carb-ups, there's so many differences. ESCO's or, you know, um, that you can join, um, you know, our buying groups or whatnot that it, it, you know, we just, it just doesn't work well, and we don't collaborate well together.
Mike Koelzer, Host: So yeah, there's so many different buying groups that it's almost like, let's say you have, you know, 20,000 independent pharmacies and then there's, you know, I'm just joking, but let's say there's 10,000 buying groups. You know, every buying group has two pharmacies and it's like, well, they don't have any power.
You need to have a third of those pharmacies or something, but that's not going to happen. I don't think so.
Rudy Dajie, Pharmacist: And I, and I think that's like the horse is too far out of the barn. And I think that the long-term care, the long-term care space with, um, PBMs is relatively new. Right. I mean, it was 2000. What seven eight was, was where CMS, uh, started paying for, um, what Maddie came in.
Mike Koelzer, Host: Oh, because before that you didn't have many PBMs because it was private pay, right?
Rudy Dajie, Pharmacist: Yeah. So, I mean, if you were in an assisted living facility, if you're over 65, unless you had a pension, you had to pay a hash. Right. So, so, um, it's really, it's a relatively new sort of space and everyone was, everybody could band together.
Um, and they could get it, but you know, when we're going back to the Dawn of time about retail pharmacy. And so yeah, to your point, there's so many group purchasing organizations and they're all sort of touting, um, all these different things. I don't dunno. I think you have to really spend enough time on your own business and really find what's gonna work for you.
And, um, revisiting those things. I mean, even your insurance, right? Um, whether it's your health insurance or your business insurance or your car insurance for your delivery cars. I mean, even personally for me, I, I, I put in my calendar that every year I'm going to. Shop all of those things. Um, and I would do the same thing with my business.
I would look at my P and L and I would, and look at the top 15 expenses and say, okay, well, what am I going to do about trying to reduce those? What are my options? And I think that people forget about those things. Um, and they're just like, okay, I'm here. We're making like, why go out and get more revenue?
If you haven't optimized the revenue you've already got.
Mike Koelzer, Host: Once in a while, there's a relationship you have where the owner of that place is still a customer, not too often, but like a local insurance guy or something. Those are on the bottom of my list of comparisons. But all the other ones, even people that you think have a decent relationship with you, you know, the sales person by name and they come in once in a while and all that, it's like, well, are they a customer of yours?
You know, probably not. So it's like, you might feel there's some closeness there, but the ads are, they're not your customer.
Rudy Dajie, Pharmacist: Well, and people would ask me that all the time, like, you know, what's the most important thing for you in, um, you know, one of your vendors and I'd be like price. I don't care about everything else to me, it's just about price.
So I'd be like, you know, that's, that's, that was the most important thing for me. I mean, service, yes. It's important. And get me this product when I'm supposed to have the product, all those things are important, but I can overlook a lot of that. If I'm getting, you know, if I'm getting the right part. And I, and I think that your supplies, like I would look at, you know, buying a , we did a substantial amount of OTCs, and I don't forget about those things.
I think that there was costs there, or
Mike Koelzer, Host: If you could put in like one or two or three words while you're no longer at your big company, why did you sell that, what is the one word to describe [00:35:25] it?
Rudy Dajie, Pharmacist: I don't know the fate. It was supposed to happen when it was supposed to happen. I was, it was time the business had grown to a point.
I think I knew I wanted to take some chips off the table. There was an interest in the business. It was the right opportunity to dive a little bit. Yeah. And, and it made sense to me. Uh, we had grown substantially. I knew we needed a significant investment in infrastructure to continue to grow the business.
And, um, so I thought that a professional organization could help me with that just overall, like restructuring the organization management infrastructure. And at that point, like everybody reported to me. What was that
Mike Koelzer, Host: infrastructure?
Rudy Dajie, Pharmacist: You needed people. I needed a real people infrastructure business. I was always stressed, but it was at a point where there were just problems that I couldn't solve or I was struggling to solve.
Like we didn't have enough people to do that, to enter. Yeah, I couldn't get enough people to do that entry. So how do I solve that problem? How is that
Mike Koelzer, Host: solved? Sometimes it's like, you can almost triple the pay and you might not find somebody soon as they're just not the right people there. So that's a tough situation to be in.
Well, and
Rudy Dajie, Pharmacist: Then also it's sort of the quality of the person too, right? Like some people are gonna type, you know, 25 scripts in an hour and some people can type. Right. So, and you're paying them the same or, you know, you don't know that until you hire them and you see how diligent they are in the arts.
Um, I think that we've solved that by outsourcing to remote, uh, remote company where they could data enter a lot of prescriptions
Mike Koelzer, Host: That might've been a full-time job for you for let's say months, trying to figure that out. You probably had so many challenges that if you had enough time on everything, you maybe could have built stuff.
Rudy Dajie, Pharmacist: Yeah. You're really going 90 miles an hour. Right. Eh, you know, as a business owner, even if you do have infrastructure, I think that you're still going there and slowing that down is always hard. It was always hard for me. Anyway, I wanted to check the problems off the list. You know, there was always like this list of things that needed to get done and the quicker I could solve one thing it was, I could move on to the next and it was in it.
It was hard for me cause I don't necessarily think that. A lot of people could solve the problems for me and maybe I was right or wrong. You know, I just stayed, my expectations. Expectations are really high and I'm strategic and I'm always sort of critically thinking about things. And I spend a lot of time obsessing over them where, because truthfully in the end, it's really my problem, right?
Like, because if you work for me, it's not really your problem. Like you're still going to get your paycheck. You're still gonna come into the building. You know, you don't really need to lose any sleep over it because it really isn't. If businesses are lost or customers are unhappy, um, it doesn't really end up.
Mike Koelzer, Host: I had an accountant years ago, this is 20 years ago and we had some pretty good years in a row. And she had said, if you're going to give something to somebody and we already had a profit sharing and stuff, she's like, if you want to give something to somebody, this would be a good year to do it. It's like, no, that's the ownership thing.
You know, they get paid, whether things are down, it's like, I don't go to them. I could, I don't go to them when years are down and say, you're going to take a cut. They just get the same. And so it's my profit to enjoy because there's enough times where it wasn't there or it's not going to be there in the
Rudy Dajie, Pharmacist: future.
Right. And you just scrape by, so you gotta, you gotta plug away when you can.
Mike Koelzer, Host: How long has it been since you sold your business?
Rudy Dajie, Pharmacist: I sold in 2018 and then I stayed on for a little while and I left in 2019.
Mike Koelzer, Host: Back in like 2017, if you were close to a mental illness, I'm not saying you were, but if you were close to something, what would it have been?
Would it have been anxiety? Would it have been depression? Would it have been, was everything happy? Go lucky. And you sold it with just a little bit of stress. How would you describe how you were feeling as things were getting bigger?
Rudy Dajie, Pharmacist: Oh, I think I was always under a tremendous amount of pressure self-induced and anxiety and, and also, and also there's, there's all these other, uh, outside forces, you know, board of pharmacy, you get inspections, uh, you know, we, we dealt with that compounding issue and ECC back when I first bought the business.
And you know, when you're filling 75,000 prescriptions a month, and if there is an hour, um, you know, you literally have to send to the board of pharmacies, this ridiculous report of things that. That you may not even be able to answer, you know, like, uh, I think those were all sort of the stressful things.
Staffing is always a stressful thing and is never enough. People were never enough. Um, [00:40:25] and you know, I was always looking for us to try to be as perfect as possible. I never really accepted, uh, well, like we'll do better next time. Um, so, so, and we would really try to promise the world, right. And that was important to me, but achieving those promises were challenging at times, especially when you have deliveries, they're three hours away.
And, you know, we try to get things out the door and expedite them. And five minutes later, something's coming up, going to that same location. You're signing another car right behind it. It just, so, um, it was just a lot, uh, A lot to manage. And I think people were sort of very siloed. And I was, I was at the top of the silo.
I was the reason that things could run across departments because I would be able to say, I need you to take this type, move it to process and quickly get it to delivery. And, but I don't think that there was any, even after I exited the business, I don't think there was a captain that really understood that.
And I think that was the challenge. And I think that was the entrepreneurial stuff that when you bring in a person that's worked at just another corporation and I, and I learned that working for an independent, I learned those things when I left CVS and I started working for an independent pharmacy and I didn't have.
Uh, canned reports and I didn't have things that just showed up in my email to say like, you know, this is how many FTEs you have. And so I learned all of these things because I didn't have them and I'd ask questions and you, you know, or you or the owner of that business was like, well, you gotta think about this.
You gotta think about that. And you got to think down the road, if fate
Mike Koelzer, Host: didn't intervene and this buyer didn't come forward. And so on, could you have pictured yourself mentally doing what you were doing until now? Or do you think there would have been a, something can come up, maybe a heart attack or maybe, or maybe you walking out or could you picture you would have just been stressed for another five years until 20, 23 or whatever?
Yeah.
Rudy Dajie, Pharmacist: Well, I didn't know it was coming. So if I did know that I would have run for the Hills, cause I can only imagine how running that business would have been. Well, listen, I would have done what I had to do. Running the business. Um, I might've had to think about other ways to run the business. I might 've, might've had to think about looking at the business that we had in which is the most profitable business and saying, like, we can't service this business.
So we're going to call the business that we can't service. That's less profitable. I mean, there's probably a million different things that I might've had to do because if I can't service the business, I can't do it. Well, I'm not gonna do a kind of a half-ass job for all of it. I'd rather do a great job and have half of it.
Mike Koelzer, Host: And then you're working on things that are positive for you. So you're cutting down. Some of that stress of some of the problems are the ones that you can't serve as well.
Rudy Dajie, Pharmacist: Right. Right. Cause I mean, you're just getting complaints. Right. And then those are just, those are difficult phone calls.
Mike Koelzer, Host: If you were an independent pharmacy owner right now and you sold without anything like.
What would you personally do right now if you sold an independent pharmacy, but you didn't have your real estate lined up and things like that, what would your next few years of life look like for you?
Rudy Dajie, Pharmacist: I think the first thing I would do is I would take a little time to understand that you got to like, sort of put the anxieties because I was, if you're running 90 miles an hour all the time, and then all of a sudden you have all this time, I think we need to sort of like build a new existence a little bit.
Right. So, for me, I had to really, you know, I was on the phone with people that were trying to wind something up. Like I had to do something when in reality I didn't have to do anything. Right. So instead of forcing it, which I think a lot of people do. And maybe people wouldn't. I mean, for me, it was like, all right, like, what's next for me?
I gotta force this. I gotta find something to call everybody and network and, you know, leverage one of the things I would say is that take whatever it is that you receive for the transaction and figure out how you can leverage that into the next endeavor. Right. So I say that to a lot of people that are like, oh, you know, if I had a million dollars, I would do nothing.
And I'm like, well, that's like their goal. I was like, I, you know, I, if I, if I had a million dollars, like, well, what'd you do with a million dollars? You know, we do. I watch Netflix all day. Like, you know, like, is that the goal? Cause that's not the goal to me, for me. It's if you're, if I, if somebody gave [00:45:25] me a million dollars, it was like, oh, how do I leverage that?
And turn it into 3 million. Or $5 million.
Mike Koelzer, Host: What would you do right now with a million dollars? You just left your job. You have a million dollars. You're not doing your current stuff. Yeah. What would you do with that million dollars? No,
Rudy Dajie, Pharmacist: NASDAQ's down 30%. I'd put it into the market. Put it there now. Yeah. If I had money sitting on the sideline right now, I would dump it on.
I would take a few months to really just settle into a new existence, right. Things that are important to you. Um, for me, fitness became important to me, you know, I became part of a gym and I got a trainer that holds me accountable. Accountability is really important. I hold a lot of people accountable, but I still think that I need to be held accountable sometimes too.
So, I have a trainer that holds me accountable on, on diet and, uh, coming to the gym and my workouts, you know? So, um, whether I'm hungover or not, you know, he's like, you got to get here and you got to work out in the workouts, always going to be hard. And because I'm still holding him accountable for my results.
Mike Koelzer, Host: So you take some time, don't think you have to jump in right away. What's some other advice,
Rudy Dajie, Pharmacist: explore the things that come to you too. Right? So what are the other, other opportunities that sort of start coming your way? And then what are, what were the other things that you were interested in, in business that you really couldn't spend any time on?
Mike Koelzer, Host: When you say that, see what opportunities come your way? It's like, if I. Drop out of my pharmacy right now. I dunno if things would come my way. I mean, they haven't for 25 years, maybe the word gets out that you're not there anymore. How does it just
Rudy Dajie, Pharmacist: get out? I think you have to put a little energy into it too.
Right. And I think you have to look at things that maybe were interesting to you that you didn't necessarily have time to explore or focus
Mike Koelzer, Host: on. Maybe you don't jump at them the first day, but putting your feelers out, at least looking things up, putting your name here, do this or that, that doesn't mean you're going to jump into that, but that helps to then let people know you're out there.
Right. And just for me,
for
Rudy Dajie, Pharmacist: For example, I enjoyed real estate. Right. And I, I, I had a couple of residential places when I was younger and I don't like residential. I realized very quickly that I don't like residential areas. So I exited that residential space and. I was dabbling in the commercial space, even when I owned the business.
And then I just said, and actually it was really only in the past year and a half or so that I was like, you know what? I really want to ramp up and make this sort of my next enterprise. Like, I want to have this very large portfolio of commercial real estate. Um, I already had a person working for me.
I took it to the next level and acquired equipment. So now I have a mini excavator and a skid steer and take on bigger projects. And it's sort of just applying the same principles to. That business is now a different business. And I was interested in how do I invest in companies and like, how does it start?
So then I enjoy, uh, joined an angel investment group and then I don't even really even do much investing with them anymore because I met a bunch of people through that group. So now when a deal is very interesting or looks very promising, they just call me and then we get on a call and I invest, um, directly.
So I think you have to be looking for those things. And I think you have to know what it is that you want. I mean, a lot of people like, look, you know, and I think it all depends on your personality too, right? If you're, if you're like, I am burnt, I am spent, I want to do nothing, but I don't know, man, like.
I can spend a week in The Bahamas, but I don't want to spend the rest of my life on a beach drinking margarita. Like I think that's just boring. And I don't think really people want to really do that.
Mike Koelzer, Host: That's what I say about myself since I was a kid, I was in the business. And so I'd say it was, you know, 42 years or something like that, 30 some years as a pharmacist.
And I'm very careful to say, I don't have any idea what I want after retirement. I know what I want to do the first week. You know, I want to go to The Bahamas or something like that, but I don't know what my mind is going to do. I might need some stimulation and need this or that. So I'm wise enough to know I'm not going to make too many plans about my retirement because I just don't know.
Rudy Dajie, Pharmacist: You know, humans are always wanting to be progressing, right? Like, like that's important for us to always be progressing, right. Whether in our society personally. So I think that if you're a business owner, I mean, I've, I've met some people that are very content, you know, golfing three times a week with their bodies.
Um, but they also have other things too. I think that, you know, maybe they're invested in the stock market and they do that [00:50:25] themselves or they'll, um, spend a lot of time with their grandkids. Um, um, so I think that there's other things that you have to find engagement in for me. I've never really enjoyed sports very much, and I'm not great at them, but business has always been my sport and I like to be the best at it.
And I enjoy it. I enjoy the race. I enjoy getting the business. I enjoy watching P and L grow. I enjoy how I make more EBITDA, uh, from current revenue. Like me, there's lots of things I really enjoy about business. And for me, it's, it's exciting. You know, I enjoyed working those hours. When I could see the results, right.
Or, you know, if we say, Hey, listen, we're going to get, um, this new agency coming on board. And there's 50, uh, patients, you know, and then I run numbers like theoretically, you know, it'd be like, okay. Or, you know, what does that each patient typically worth? And what does that mean to our top line? What does that mean to our bottom line?
And I'm an ops guy, so I'd be running ops and strategy. Like, okay, we need to hire this many people and like what drugs are there on? Let's make sure we have those drugs in stock. Let's order that stuff in advance or, you know. Okay. Well, that's a really good reimbursement drug. Oh, that's chlorpromazine. I know that med D cameras pay really well for that.
That'll be really good for us. Um, you know, I enjoyed all the granular details.
Mike Koelzer, Host: I think my problem right now is those things always made the other things of owners. Palatable because it's like, well, if I'm having these ideas and I have this freedom to do these cool things, I'm not going to do it alone and I'm not going to do it as an employee somewhere, I'm going to do it.
And I'm probably going to have employees and that's the price I'm going to pay for these dreams. And I think I hate to say it, but a lot of the positive things aren't there because you get slapped around by the PBMs. And I know that there's positive things, but they take some work, you know, but it just seems that right now, I think employees are a pain because I don't have anything fun to slash profitable, balancing that out.
Rudy Dajie, Pharmacist: Look, it's really hard to make a good amount of money. It's really hard. Right. I mean, and I, I get where you're at, which is it's, it's a grind. And, you know, you're not showing up in a Lambo. Right. You know, and, um, I think pharmacy's a hard business to be in as an independent person. And it's, it's been hard for quite some time, but it's becoming increasingly more
Mike Koelzer, Host: difficult if people came in, when my dad was in the business, you know, you make 40%, it's all what you're comparing it to.
Right.
Rudy Dajie, Pharmacist: That's all. Yeah. What, you're the relative period in time that you're comparing it to. And, um, and then there's, you know, to that end, there's some people that we, we talked about this a little bit, you know, for me, it wasn't that I wouldn't want to deal with all of, sort of the headaches and stuff to make $120,000.
And I'm running my own business. I think there are people that are like, Hey, at least I don't have to answer somebody. I can own my own pharmacy. I can make 120 grand or whatever that number is. And that makes them content too. So I think that. I think success is not always clear, clearly defined. I think success is different for everybody.
I think success in different aspects of people's lives as well. So, you know, you can be like, well, you know, I think you've asked people, what is success? Are you successful? And I would say in what aspect, you know, in business, in my life personally, relationships parenting, like maybe like, what is it that you think success is?
We're in a very sort of regulated business. And we in the walls are sort of closing in on the box. Right? And I think there are going to be new opportunities coming shortly. I think over the next 10 years, there's going to be a significant decrease in population. There's going to be, uh, there's already studies done.
I read a study about all of this. So it's going to be very, very challenging, I think for big businesses to continue to continue running. W the way that they are running. So I think then there'll be creating these spaces for pharmacists to, to start businesses and be successful for grocery stores to be independently owned.
And for them to be, there'll be that margin space in between where the big boxes can't perform and people are just not happy with them. And I also think that you're going to see consolidation. So I think you're going to see that instead of having a CVS on every corner, you're going to have those locations close and you'll have a big, large [00:55:25] box CBS where people will go from many, many towns and cities to that CVS.
And then they'll have obviously significantly more pharmacists and technicians and staffing working there and automation, but there'll be a big box versus, um, a CVS on every
Mike Koelzer, Host: corner. Why do you think that they're not going to be able to continue to be strong? Well, I think they're going to have
Rudy Dajie, Pharmacist: trouble staffing.
I think they're gonna have these big staffing problems and they're not going to be able to create solutions to them. I mean, they, Starbucks can't create solutions to these problems, like in a, so I don't see how CVS and Walgreens and Costco and Walmart are going to create all of these solutions either.
So then I think then that equals an opportunity for, you know, um, uh, Mike or Rudy to open a business and say, I'm going to hire five people and I'm going to pay them pretty well. And, and they're going to want to be here because they deal with me every day. And, and, you know, I deal with a lot of the problems.
And so I think that those opportunities will exist. Um, and I think our cultures continue willing to move down that road, right? Like people like farm to table and independently operated businesses and they feel like there's a better quality. So I think that we'll continue to see that trend go there, but the next 10 years is really very, very interesting, um, especially around.
No, the baby baby boomers that aren't in the workplace anymore. And, um, and you know, people aren't having children as readily as they were. And so I think that there's going to be challenges. I think there's gonna be a lot of expectations that people have just the same as we currently do.
Right. Like, I, I don't really want to work, but I want to be able to get my coffee. So who's gonna, who's gonna make the
Mike Koelzer, Host: coffee. It's not like they happen over night. You remember McDonald's, you know, when they'd say, pull ahead and we'll bring out your something, and then they never come out. You know what I mean?
So it's like, you don't want to pull ahead cause you know, you're going to get forgotten about, so then they have these new things where you pull up to the curb and you punch in what your curb number is, you know, on the sign on 18, you put your order in and then they're going to come out. I did that. Half a year ago.
And I just sat there and sat there and like 10, 12 minutes went by and it's the first time I actually drove away without my fast food. It wasn't worth it to me to say, Hey, you owe me $5 because you didn't bring this out in time. So that's going to be trouble too, because you don't go from many employees and then use technology.
Let's say you got 50 of whatever. And technology is going to get you down to 20 or whatever people let's say 50 and 20, the need for humans. But to get to that 20, from that 50, you have to go to about 70, you know, to do it right. They get the right people in there. And so there's going to be a lot of struggles with that.
Yeah.
Rudy Dajie, Pharmacist: And I think companies across the board and I struggle, and I think that there's going to be technology and automation and AI and all sorts of stuff. That's going to come into play, but there are going to be. Businesses that are just tactile in nature that can't do without people here in the store.
Right. I mean, you know, that's, that's, um, you know, especially businesses that deal with, with people that have disabilities or people that are geriatric, right? I mean, you know, if you want, if you have an 85 year old walking into a hospital, they can't check themselves in a lot of times, rarely, they don't know how to navigate those systems where they're hearing impaired or vision, you know, vision's impaired.
So I think there's just going to be businesses that have to have people engaged. And I don't know
Mike Koelzer, Host: what that looks like. I was traveling with my brother-in-law and we went to, uh, pick our car up. And some of these, you can do it on your phone, but this company is good to go up. My brother-in-law is showing his phone screen to some old guy behind the counter that they brought in, you know, post COVID or something he couldn't see or hear, he's trying to read my brother-in-law's phone across the counter so he can type something into his computer.
And it was just an interaction that did not have to happen. And those are the ones where you would get rid of the humans, thankfully, but there's a lot that are still going to have that human touch to them.
Rudy Dajie, Pharmacist: Yeah, no. And, um, it's nice to sort of sit on the sidelines and watch. I don't really usually get too bent up about me not being able to get my coffee and stuff, but, um, I also think that it'd be very, very challenging to live it, write it.
And I think the difference between an entrepreneur and, and owner or somebody that's owned a business versus somebody that. And employees and maybe, you know, these are sort of generalized statements. So if I, as an entrepreneur and previous owner, [01:00:25] and even when I wasn't an owner and I worked for somebody, I acted as if I was an owner of that business.
So if you hired me today and said, you're the CEO of this business, I would live and breathe that business. I wouldn't just be able to turn it off. And I think that's the challenge in working with people myself is that when I had people coming into my business that were highly compensated or, you know, for them to be like, well, now I'm shutting it down.
It's five o'clock, I'm heading home. You know, whether it's the world is ending or not, you know, And even when I had sort of taken some chips off the table, I still was so engaged in my business that it was very hard for me to just be like, well, I took the majority of my stake out, so I don't really, I'm not really worried about how this performs.
I mean, I wanted to go to the next level. I wanted this thing to grow and be successful and I took everything to heart and personally, and that would just be the same. Now, if I started another business, I'm the same with everything that I do. It's just the sort of passion I bring to things. And I even went to work with people.
I have to figure out how to dial it back because I can't drag you to the finish line, you know? So I have to be able to figure out what's going to work for you. And how much do you really want? 'cause uh, you know, it's not my business.
Mike Koelzer, Host: I get burned out at the pharmacy sometimes, but I know I still have that entrepreneurial bug in me.
And that's, I guess, part of the reason for the podcast, but I want to keep building something. Well, that's part of my structure this year . I haven't monetized this, but building something with zero employees is a dream, an entrepreneur without employees, something without employees as mine, maybe that's just retirement.
Maybe that is, Hey, Rudy, what a pleasure meeting you and talking to you, Mike,
Rudy Dajie, Pharmacist: this was awesome. I really appreciate your time. I hope that it was helpful and I hope that it was engaging and maybe some nuggets that somebody takes away that helps them in their business.
Mike Koelzer, Host: For sure. Thanks for all you're doing for the profession and keep up the good work.
Thanks Mike.
Rudy Dajie, Pharmacist: Appreciate it.
