Latest / Home Service Millionaire with Mike Andes / He's Ready to QUIT His $1.3M Landscape Business

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He's Ready to QUIT His $1.3M Landscape Business · Home Service Millionaire with Mike Andes

0:00
Every day you break yourself, you're just like, all right, you just got to get through the day and just put out as many fires as you can and then just go home and just chill out like I don't want to keep living like that anymore.
0:06
Still feel like you're behind.
0:08
You come in the weekends, you still feel like you're behind.
0:10
You can only feel like that for so long.
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Today we're in Illinois visiting Matt from Brooksdale Landscaping.
0:14
Is it a people problem?
0:15
Is it a leadership problem?
0:16
Is it just like a direction problem?
0:17
Like, like what is it?
0:19
I think we can actually build something that will last.
0:21
You're going to quit this business by a death of a thousand cuts of not wanting to be here?
0:25
I would say it's definitely to 100% burnout.
0:28
Last year he did $1.3 million in revenue, but he has fallen out of love with the business.
0:34
It's just kind of crazy, you know, kind of nuts.
0:35
Yeah, I think it's only up from here.
0:37
And we're having to work more and more than we ever had to.
0:38
Like, why am I in our balance sheet trying to figure out what's wrong when we have a bookkeeper?
0:42
You fell out of love with the business.
0:43
Yep.
0:43
And as soon as I hear an entrepreneur fell out of love with the business, if they don't change you, it's in two or three years, the business is gone.
0:49
I'm just so exhausted.
0:50
He's on the treadmill of growth with no finish line in sight.
0:54
Maybe sell a portion of it, sell some of it to some of the guys.
0:56
It's a great day at Brookdale, I mean, I like it.
0:58
Some of the guys have been here for eight years.
0:59
That's where a lot of the pressure's coming from.
1:01
Kyle's left college for it, he left college for it.
1:03
I was just trying to go to college.
1:05
I chose this because I think we really have a good opportunity here.
1:09
A lot of pressure doesn't come without its weight.
1:13
That risk is proportionate with the size that that business will probably become.
1:16
And so if you play it safe your whole life, you'll probably have a small business.
1:18
This is the Business Turnaround Show.
1:20
My name is Mike Andes.
1:21
I'm the founder of Augusta Lawn Care and Homework Software.
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I travel the country fixing struggling businesses.
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It changes everything in the business.
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It's hard.
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Our goal is to give Matt a strategy to turn around the company in the next six weeks.
1:38
All right, we have flown into Chicago.
1:40
We're at the hotel the night before.
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We're gonna go visit with Matt Baker.
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I'm gonna watch his application video and look over some of his numbers.
1:47
Hi, my name's Matt Baker, and I run Brookdale Landscaping.
1:51
We do landscaping primarily mulch installations, some mowing, and then we're known for our holiday light displays.
1:57
We do commercial displays throughout the winter.
1:59
Interior displays, Christmas tree rentals, high-end decor, decorated garland, so that
2:05
Okay, we have already heard like technically 10 different businesses.
2:09
Having a $1.3 million business, I would rather him have a $500,000 annual revenue business, but he just does the Christmas lights.
2:16
I'm going to go out on a limb and say this is going to be a lot of disorganization and lack of systems, not because of his problem as much as he has so many different services.
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Our annual revenue last year was $1.3 million.
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This year expected to be around $1.4 million.
2:29
I wouldn't say we have too many financial struggles, maybe just me spending too much or...
2:34
maybe too much on marketing, we don't need to, and stuff like that.
2:36
Alright, so two big hallmarks of a business that is around 1.2, 1.3 million dollars revenue.
2:42
It's stalled, it's growth, and at the same time, the entrepreneur's adding services and spending a bunch of money on marketing.
2:49
This is usually a business that is very difficult to systematize and it's proven by the fact that it stopped growing.
2:56
The 1.3, 1.4 million is this year, but it grew really, really fast because he added a bunch of services and spent a bunch of money on marketing.
3:02
But eventually if you don't keep the customers and it's not recurring and you're spread thin with all the different services, it usually plateaus around this size.
3:10
We have 12 employees.
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It's just a lot for being 25.
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I'm kind of curious like how you handle that.
3:14
We have Lori who's in the office.
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We have Leslie who does admin for the Whiteville side.
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My mom does accounts payable and accounts receivable.
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And then we have Paul who's like my right hand man who does all the estimates and kind of runs the crew.
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Five overhead people.
3:29
Okay, here we go.
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Admin wages.
3:32
For admin wages right now, they're paying $178,000.
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That's just payroll, let alone not tax.
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So like, let's just call it 225,000.
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That's like over 15% of their revenue is being spent just on the wages
3:46
for the office and admin we're really struggling with processes so in the beginning the business was about getting new clients you know marketing providing good quotes communication and now the business is about leadership structure processes workflows standard operating procedures and really struggling to streamline everything i'd like to love my business again right now it's
4:08
I'm pretty burnt out.
4:09
Just we're really struggling with the structure and being fair to everyone.
4:14
It's been really challenging.
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And you can see the guys getting frustrated because they feel like we're not doing our part.
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It's a little disorganized.
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Because there's so many added steps and complexity when you've added all these extra services.
4:27
And I know his intentions are good.
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He wants to keep his crew busy year-round.
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But a lot of times people jump to adding new services to fill their off-season when they could just...
4:36
push through what's hard and that is selling more and better to your existing customers for the services you already sell.
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And so I'm going to guess I'll be pushing that very heavily and five admin people or five overhead people to 12 people total.
4:49
That's a lot of people in the office and a lot of times you get a lot of bloat in the admin or overhead positions when you don't have simplified services.
4:56
That same size business could run with one person in the office if they were doing one thing, but now you have this
5:01
1.2, 1.3, 1.4 million dollars, and five people overhead, it's because he has all these other services.
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We've got a great crew.
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Some guys have been with me since high school.
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I would love to talk with you, pick your brain, and hear how you could help us and make sure that we can grow, because right now we just can't grow, and the guys want a career.
5:32
Whoa, hi, how's it going?
5:34
Good, how are you?
5:35
Good, what was your name?
5:37
I'm Laurie.
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Laurie and Mike, good to meet you.
5:39
Hi Mike, nice to meet you.
5:40
Hi, I'm Laurie.
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I do anything related to coordinating.
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Paul arranges the schedules, I communicate that information out.
5:49
Hey Mike, Paul.
5:50
Hey Paul, good to meet you man.
5:51
Yeah, nice to meet you.
5:52
Absolutely.
5:52
It's always dynamic, cause like, you're the owner.
5:55
Yeah.
5:55
Are you basically the ops manager?
5:58
Yeah, I'd say so.
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Part owner, operations manager, whoever needs to be some support to keep things going.
6:05
Matt kind of operates the office.
6:07
He steers the boat and I'm kind of rowing it.
6:09
How much does this cost?
6:10
The shop space with the warehouse and everything?
6:12
This unit is like 280,000.
6:14
Oh, you bought the unit?
6:16
Yeah.
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Smart, okay, cool.
6:17
So most of the storage is actually for the light side of things.
6:19
Yeah, not much for landscaping.
6:21
Yeah, you started with the lights.
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What year was that?
6:24
2012.
6:25
Oh wow.
6:26
You started with the lights back then?
6:27
Yeah.
6:28
When did you add the landscaping in?
6:29
Oh sorry, so the light show was 2012.
6:31
It was like a light show.
6:32
Okay.
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It wasn't like for customers, it was like for me.
6:35
Oh, okay.
6:35
And I started mowing lawns when I was 12.
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Let's just take it back a little bit.
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I'll try and keep it short.
6:40
So I never intended it for any of this.
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This never was my intention.
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It all started to fund a holiday light show that I started when I was 12.
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It was a neighborhood light show, it was like my hobby.
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Christmas lights are my hobby.
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And to do the show you needed money, because all the equipment, lights are expensive.
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And I...
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started mowing lawns.
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I didn't want to work at McDonald's.
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I knew I could make more of my name's grass Then I could bring McDonald's to fund this light show then people started coming to the show and saying oh You have a landscape business.
7:05
Well, could you come to our lights?
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I'm like, yeah, sure So the business grew as this light show grew and so right now it's still about 60% landscaping 40% lights from a revenue perspective and
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Right around there, yeah.
7:15
Yeah, maybe getting closer to 50-50, but yeah.
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So lights is really the thing that's growing more right now.
7:22
Yeah.
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Oh, yeah, yeah, yeah.
7:24
I think Lightville grew like 30-something percent last year, and landscaping was like 15%.
7:28
And so in the beginning, it was fun because it was like us chasing the client, commercial clients, coming up with something unique, sourcing unique trees, giving that level of attention to detail.
7:36
Like we didn't have much pressure because there wasn't that much staff here, and there wasn't that much overhead.
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It was really fun up to about $800,000 in revenue.
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The holiday lighting really grew when he came on, when we rebranded to Lightville, which was 2020.
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Kind of it's been the key.
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Like, he's been able to, like, sell the work and, like,
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have that role and then I would be able to just make sure it got done.
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And so like it was kind of flexible, right?
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Like I can come in and I can work on all these quotes.
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I could, you know, tell these clients like, hey, we have this rock product, this mulch product, and we have, you know, this tree.
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And I could sit down with the client and create really cool contracts that fit their needs and really cool displays.
8:09
Well, now we've grown.
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Obviously that doesn't work because it's, you know, you got to be simple and streamlined.
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And so they're wanting like a unique display.
8:15
I'm like, I don't have the time for it.
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We can't change the display at all.
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It's got to be the same.
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There's just no way I can source new decor for you at all.
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I just don't have the time.
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So I think I've gotten further away from the reason why I love this so much because it's gotten bigger.
8:29
Kind of like to your point, now that we've grown, that's so complex.
8:33
We haven't been able to take on new displays or anything like that because I'm so overwhelmed and bogged down that I can't, I just can't.
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It's part of the reason why I'm here is because before it was to build a business that creates the coolest, the hottest place, we have all this unique decor.
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Now that it's grown, it's like, well, that's not working.
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It's not working because we can't even take on the displays that are
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are calling us.
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So like the holiday lighting season has started.
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I'm like, we're in the thick of it right now.
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I mean, we've, and the reason why I'm a little frustrated right now is because our ideal client that we've been trying to, I mean, we'll work, you know, past three years for, but now they're coming to us.
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And like, we've had hotels in Rosemont with like $16,000 budgets.
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We even had a city with a $40,000 budget for a big Christmas tree.
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And one proposal working on it, it's
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It's a $60,000 light show tree for a city fountain plaza.
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These are all jobs that we've been working so hard to get.
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And here they are, and I don't even want to deal with any of them because I'm so bogged down and everything else is going on.
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We're passing up the opportunities we've all been working hard for the past three years.
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They're right in front of us, literally right now.
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And I can't even get to them because I'm just so exhausted.
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It's crazy because these are the jobs that we've been wanting forever.
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Like, you know, these are it.
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They're right in front of us and we're so exhausted to even deal with it.
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And so what's the goal of the business?
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I know like in your application video, it was kind of like you fell out of love with the business.
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It feels like it's going to become cumbersome as you've grown.
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But like when you look at the business, what's the goal of the company?
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I would say to grow sustainably.
9:57
Right.
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So like be able to grow without like just exhausting yourself.
10:02
and so it's just leading to a lot of burnout because every day you're just spitting out fires when it's like, well man, we have all these people here and I can't actually do the work that I need to do or like to do because you're just putting out fires every day and so yeah, I would say it's definitely to 100% burnout.
10:16
The guys used to work here just for a job, right?
10:19
It was like their summer job, it was like their high school job, whatever and now it's changed so like they want a career and they're actually looking to us for a career.
10:24
We really like our team, we really like our guys, we want to make sure that
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Everyone's taking care of them, ourselves, everything.
10:30
So growing there so that they can have a career and then maybe that we,
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I don't need to be as in the weeds and I can, you know, put more of my creative energy into the business.
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Maybe sell something to some of the guys.
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I mean, some of the guys have been here for eight years.
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What about you, Kyle?
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How long have you been working here?
10:46
In the meantime, this will be my third year, but as long as we're working with Baker, I've worked for about eight years.
10:51
Well, I started working with Matt back in high school.
10:55
It's a good career.
10:55
I enjoy working out here.
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We used to...
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play hockey back in high school, that's how I met him.
11:01
Awesome.
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It's been a fun ride, lots of ups and downs.
11:05
Well, this would be my fourth year doing landscaping.
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I've been doing landscaping ever since I got out of high school.
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To be honest with you, I just really like what I do.
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I think we could actually build something that'll last here at Brookdale.
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It's a nice break from the landscaping.
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We would go over to Lightville and then vice versa.
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The reason I love working at Brookdale is I love the boys, you know, got a good boss, you know, got a good manager.
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The team is amazing.
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It's a great group of people to work for and with.
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I've always been good friends, so I've always been happy and excited to see him grow what he's built, and I'm happy to contribute to it.
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It's my second home, basically.
11:40
It's a great day at Brookdale.
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I mean, I like it.
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I love seeing the guys come in all enthusiastic after a day's work.
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They're covered in mulch head to toe, and they're all grinning, you know?
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And it's just fascinating to see who smiles the most when they walk in that door.
11:55
That's where like a lot of the pressure's coming from is because they want this career, they're staying.
11:58
Like, Kyle's left college for it, he left college for it, Zach left college for it.
12:02
I mean, that's where a lot of this is coming from, I would say.
12:05
I was just trying to go to college, figure out a career.
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I chose this because I think we really have a good opportunity here to build a company and make a lot of people happy.
12:17
It's not just like Matt's hobby anymore.
12:19
He could play with lights and
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do a crazy treat for someone, right?
12:22
Like, no, it's a business and people depend on it.
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And I think that's where the growth is really coming down from.
12:27
It's also where the pressure comes from, too.
12:29
It's a lot of pressure, you know, looking at us to figure it out.
12:33
And we're OK with that, but it doesn't come without its weight.
12:38
Yeah, like I don't think we're going to solve that today, but like I definitely think having some thought around that is important because otherwise you're just on this treadmill.
12:45
It really goes nowhere.
12:46
Yeah, yeah, yeah.
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And it's like, well, why grow?
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Does it actually serve the required?
12:50
Like if the goal is to just have a career for the team, well, we could just make this really profitable, give them a piece of profit sharing.
12:56
Giving equity gets really messy, but like profit sharing.
12:59
making sure like Paul has incentive.
13:01
So if you wanna take a week vacation, like you know it's being ran well, you've reduced the services, you cut out the complexities.
13:08
Like we can create systems all we want or just cut out the things that are causing problems.
13:12
A lot of times I see the first three, four, five years of business being where you are constantly sacrificing in order to be able to invest back into the business.
13:21
But once the business has got to a certain point and he's already doing 1.3 million in revenue,
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If you can no longer see how sacrificing for the business helps you personally, you start to resent the business.
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It's like your slave master.
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It tells you what to do, when to wake up, how hard to put effort.
13:36
It has always told you what to do and has constrained you from doing what you love.
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And so when I look at all the services you offer, like the fastest way to make this business where you don't feel like there's a lack of systems is just cutting out complexity.
13:51
the myriad of services being added.
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Residential, commercial, project mowing, like you got everything.
13:57
And so if you looked at each of those individual sectors, what I would call services or businesses of themselves, you got businesses that are doing 150 to 200,000, some businesses doing 300,000, like you got
14:08
eight businesses jammed into this one thing.
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Even multiple DBAs jammed into this thing, multiple websites jammed into this thing.
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Being clear about like, okay, if my goal is I wanna love this business, what does that business look like?
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And then trying to chart towards that is really important.
14:23
Otherwise we're just like, well, we're kind of trying to grow sustainably, but we also don't wanna be running a chicken without a head.
14:30
Then we also wanna be servicing our team and giving them a career and potentially letting them own the business.
14:35
So like having clarity would be helpful.
14:37
You still feel like you're behind no matter what.
14:39
It's like every day you brace yourself.
14:40
You're just like, all right, you just gotta get through the day and just put out as many fires as you can and then just go home and then just chill out.
14:44
Like I don't want to keep living like that anymore.
14:47
Leaving every day late, you still feel like you're behind.
14:49
You come in the weekends, you still feel like you're behind.
14:52
And I'd really like to shake that feeling because you can only feel like that for so long.
14:56
Anytime in any relationship that you love something or someone, you will deploy discretionary effort.
15:02
And in order for this business to go to one point, from 1.3 million to beyond, three million plus, he's gotta have discretionary effort and he's gotta love the business again.
15:10
And you will never love the thing that you feel you have served and is not giving back to you in any way, shape or form.
15:16
And I know when you've grown as quickly as you have and you're as young as you are, it's like, well, I don't really know what I want.
15:21
That's okay.
15:22
I think as you get where you want to become a great leader, having a vision that you can actually rally people around is really useful.
15:29
Sure, 100%.
15:31
Yep, that's my weak point for sure.
15:33
Me being young is more mental.
15:35
It's more like personal.
15:37
Then really business, like with me being my age and everything, like it's just a lot.
15:42
It's really draining.
15:43
So like I'm losing touch with friends.
15:45
Weekends, I'm exhausted.
15:46
You can't really relate to anyone because no one like no one gets it, right?
15:49
Or like you're and just the responsibility, you know, so like I noticed it just sounds so dumb, but there was a day off maybe in March where all the guys went skiing.
15:59
February, some of the guys went out to Colorado to take a skiing trip.
16:01
You know, there's really no income being made, but we still, you know, all hang out as a group and stuff like that.
16:06
I'm like, okay.
16:06
Oh shit, like, I love to go skiing, but I'm drowning in paperwork, you know?
16:10
Or like, my friends live in the city, they'll get a day off at work randomly, right?
16:14
And that's a day to do stuff around the house, to take a walk, to go to the beach, like just to be a kid, be a 20-year-old.
16:20
I've been at this since I was like 12, right?
16:22
So a day off with no one in the office to me seems like a day to get a lot of stuff done.
16:25
Like, I couldn't imagine being at the beach right now.
16:27
I think that's more like the age thing kind of I'm struggling with a little bit more.
16:33
Like FOMO maybe, like yeah.
16:36
I think it's also the thing that you crave though.
16:38
Because like the thing that you hate doing is getting in the weeds.
16:41
Zeroing out though, like what's the mission of this business?
16:43
Why do we exist?
16:44
Why are we growing?
16:45
Why are we adding this sector?
16:46
Why are we, like that would probably be the thing that also gives you a lot more discretionary effort in that area versus like, we're gonna go get some more lights clients.
16:54
You're like, okay, cool.
16:56
I think a lot of entrepreneurs are in an abusive relationship with their business.
17:00
The business has always told them what to do.
17:02
It has always taken away from them and it has never given anything to them.
17:05
And for that, the entrepreneur resents the business and that's what keeps it from growing.
17:10
So then how do you find your North Star?
17:11
Like how do you, because there's obviously like a million different countries you go.
17:14
How do you find, like how do you figure it out?
17:15
Like how do you...
17:17
Yeah, like the thing that stands out to me when I look at like your application video, like what you were saying, is you like either directly or implicitly said like you fell out of love with the business.
17:29
And as soon as I hear an entrepreneur fell out of love with the business, if they don't change you, then in two or three years the business is gone.
17:35
because eventually your attention goes to something else, and then all of a sudden the team starts to fall apart.
17:41
Eventually you find something else, your passionate love, all your attention is on it, your love is towards it, and then the business goes to the wayside.
17:49
And so when you're leading a team that you care about, I think to be a good steward, it's like let's make sure that I do have clarity.
17:56
And a lot of times it's just like, it's really simple.
17:58
The number one thing we gotta do is make sure you stay loving the business.
18:01
The only way to fail in business is to quit.
18:05
And so when I look at the entrepreneur, the person that owns 100% of the equity, if they quit, everything else is gone.
18:12
The employees don't have a job, customers aren't served.
18:15
And so instead of going after these other details, I'm going at the heart of the issue, which is we've gotta keep the head of the entrepreneur and the business owner in the game.
18:22
And so sometimes taking a step back, staying in profit mode, not growing the business, or focusing on the areas of the business that you actually are passionate about, keep your head in the game long enough so you don't quit when the times get hard.
18:34
The overarching cloud over the business is that if you don't like it, eventually this business will not work.
18:38
It doesn't matter how much money, it doesn't matter.
18:39
Like if you don't love the business, eventually it will show up on the P&L.
18:44
I think part of it too is like you've hit this plateau again, like you grew very quickly, and then now you're at 1.3, 1.4, the business looks very similar.
18:51
It's not like you're having new problems, new things to work on, it feels redundant.
18:56
And you're hitting your head up against the wall of like, I don't have systems in this department.
18:59
And you will likely not grow past 1.4, 1.5 without a huge amount of stress on yourself or you changing the business.
19:06
And so I don't want you to keep beating your head up against this because you're like, man, I hit 1.3, then 1.4, then 1.4, then 1.6.
19:12
I'm hitting my head up against this and eventually like, all right, forget this.
19:15
Yeah, no, you're right on, yeah.
19:17
Yeah, because you're 25, you're 26, like lots of opportunities will come your way.
19:22
You will have another love in your life, whether that be a girl, whether it be another business, whether it be an opportunity, whether it be an investment.
19:28
And if you hate this business, because after three years of beating your head up against 1.4, 1.5, and you're doing stuff all day long that you hate doing,
19:36
You're going to leave.
19:37
Yeah.
19:38
And so, like, the ultimate insurance for this business is make sure you love the business.
19:42
I think the big question is when I'm 30, am I going to look back and be stoked that it gave my business my all?
19:49
Put me in a spot that other people may not necessarily be in?
19:52
Or am I going to look back when I'm 30 and be like, man, I missed out on all the social interactions, making friends, traveling.
19:58
moving around, trying different things, kind of being like a free spirit in my 20s.
20:03
And I think that's just kind of like the question that I've been trying to answer over these years.
20:07
This doesn't like relate to this, but I just got like entrepreneurial questions.
20:11
What I'm blown away with you is how do you
20:13
How did you, like you have the bookkeeper, which I'm on the wait list, right?
20:17
So like, how did you say, hey, I want to start this bookkeeping service and then hire a bookkeeper and know how to hire a bookkeeper, what to offer and then grow it, even if we didn't have like all the customers.
20:25
Like how do you, like command center, right?
20:27
How did you figure out like, hey, I want to do this command center.
20:29
Command Center is the centralized office or admin that we have for Augusta Lawn Care, where we have over 80 agents that were answering phone calls, doing texts, doing email, running payroll, all the admin related tasks.
20:41
So the business owner, especially when they're first getting started and growing quickly, so they can focus on sales and operations instead of admin.
20:48
When they're a million dollar business, maybe they'll get an office manager, but I don't want them when they're first getting started, figuring out how to do admin and email and answering the phone.
20:55
That's what Command Center exists for.
20:57
How do you just figure out like the structure and everything behind all the different things you do?
21:00
You just start and then you constantly ask the customer how you can serve them better.
21:04
Any things that you mentioned, I still have plenty of problems to work on.
21:07
Our number one value is constant improvement for the reason of like, I know when I start, I will not be perfect.
21:11
And so my only focus is what's the pain point of the customer and I'll solve it.
21:14
And it will take you a long, like the bigger the business gets, the longer it takes to solve each problem.
21:18
This is just a curiosity.
21:19
When you started your home service website company, how did you start this?
21:22
Did you find a web designer?
21:24
A lot of those departments, those ancillary things I've started, is I wanted to afford a killer, but I couldn't afford them, so we offered the service ancillary to be able to subsidize their cost.
21:33
Did you have to take a financial hit in the beginning to do that?
21:36
And you were just comfortable taking that financial hit because you knew down the road?
21:39
because it aligned with the why.
21:40
Like the why was big enough for me to realize I needed those components.
21:44
Adding the software is like the worst three years of my life, like trying to get this up.
21:48
But I know in the long run, I need the software for the franchise.
21:51
And so like, that's why knowing the why is so important.
21:53
Cause like when you want to quit, when there's issues out towards you, when it's sucking money out of your pocket like crazy, when you see no evidence of success, you have to have something to fall back on.
22:02
For every business I've ever started, and that exists today, there's a period of time where I wanted to quit.
22:08
For the franchise, it now has over 200 locations, we do $75 million in revenue this year.
22:14
But when we were at 90 locations, we weren't making any money.
22:17
I was pouring money back into the business.
22:19
We were negative profit.
22:20
And I was living in the office, in the closet, so that we could do that.
22:24
and I didn't have hot water.
22:26
I had to go next door to be able to take showers at the gym.
22:29
That was not fun.
22:30
The media side, same thing.
22:32
I did five years of making content on YouTube before I made a single dollar on YouTube ads or making any dollars from courses or whatever.
22:40
When it came to the software side,
22:43
The first year we grew a bunch, a ton of bugs got in, and I spent days sometimes without sleeping because of all the problems and the pressure I was going through.
22:51
Every single one of those, within about two to three years after that low point is when I'm so glad I pushed through.
22:56
Now, when it comes to the franchise, the software, the media, why did I push through in those low moments?
23:01
It was because my why propelled me and pulled me to get past those times.
23:05
And the why was, I wanna change the level of professionalism in a landscape industry.
23:09
And I'm going to need media,
23:11
I'm gonna need software, I'm gonna need the franchise to do that.
23:14
And so it wasn't ever an option to quit during those low moments because my why pulled me past those hard times.
23:21
Yeah, so the reason for asking is because in February we go negative, right, because we have all this overhead but there's no revenue.
23:27
So you're like negative like 26, 30 thousand dollars and you're like wow, like Jesus, it's really worth it.
23:32
And I'm like man, this is just like one business, right?
23:34
Imagine like with you with multiple.
23:36
So yeah, I was just curious about how you stomach all that.
23:39
Well, like the size of your risk will correlate with the size of your goals.
23:43
And so like, you know, I lose hundreds of thousands of dollars a week when we were in the middle of stuff with software.
23:48
And like as the product looks the worst, you're dumping more and more money into it and investing more and more.
23:52
So like that risk is proportionate with the size of that business will probably become.
23:57
And so if you play it safe your whole life, you'll probably have a small business.
24:01
So solving the biggest constraint in the business, the biggest problem, is always on the other side of that moat is the castle.
24:07
And so if you're able to figure out how do I get revenue in February?
24:11
Oh, I can pull demand forward.
24:12
I can make offers to my existing customers and pull them.
24:15
That's the thing no one does, but it's also the thing that unlocks the most profitable business.
24:19
Absolutely.
24:20
How many times has your why changed with Augusta Lunker, like the North Star?
24:26
None.
24:27
Like it was mostly because after I got in the accident, it was a function of I was very clear I wanted to help other people not get in that same situation.
24:34
That focus for me on the media side, like the franchise was realizing that no one listens to the content unless I compete with them.
24:42
And so now with 200 locations, I compete with most landscaping companies and now they'll listen, right?
24:47
And so we can see directly when we go into a new location that P4P, for example, people will start adopting it in that area.
24:55
because they see, oh, Augusta moved in, I've gotta start paying my guys that way of doing profit sharing or whatever.
24:59
So that's how we have the impact on the industry, but it all ties up to that.
25:03
Every business stops growing for one of four reasons.
25:06
It's either a lack of liquidity, a lack of leads, a lack of labor, or a lack of leadership.
25:11
I call this the 4L framework.
25:13
And right now, I'm really going to zero on what are the opportunities in each of these categories to be able to grow the business.
25:19
From a liquidity perspective, I don't see any problem with the business.
25:22
You have plenty of cash reserves.
25:24
You have a decent enough profit margin.
25:27
I don't, one thing you mentioned in your application video is you spend a lot on marketing.
25:31
I said, I saw 20,000 last year in marketing.
25:33
Is that accurate?
25:34
Yeah.
25:35
Okay.
25:35
All right.
25:36
And what are you spending that on right now?
25:38
We haven't done any marketing this year.
25:39
There's a few in there, but that was like for the website or like stuff like Google has done we paid from last year.
25:44
But no, like paid ad strategy right now?
25:46
No, no.
25:47
Okay, and is that because you have constraints around the crew?
25:51
Is it because you have constraints around the office space, the admin, what's the constraint?
25:54
Why aren't you like, grow this thing to the moon?
25:56
Great question.
25:57
So because when we, like last year, we were spending money on ads, he could get to the request right away and make sure that that customer was heard.
26:03
Now, pfft.
26:04
He's on the field and I've been bogged down that a question comes in from paid ads, like they might, you know, they're not getting that service as quickly as possible and so then you're wasting your money because they're just going to whoever they got to first.
26:16
I feel like we waste money on marketing because we just can't get to, we can't service the leads as quickly as we need to.
26:22
But we'd like to be able to do that again, but he needs to be available to go take that estimate as quickly as possible.
26:28
Got it, so you're doing estimates and you're also managing the crew day to day.
26:32
So you have to balance those two things.
26:34
Right now, management of the crew is essentially a full-time job.
26:36
We don't have time to go get to leads that are coming in.
26:39
Exactly.
26:40
I'd say, like right now, a lot of my time is in the field.
26:43
and I'm kind of pulled away from booking the schedule, doing estimates, I'm kind of dropping the ball in that sense.
26:49
I'll work a full day in the field, and I'll come back and I'll have all these clients that responded to me or asking for work or looking for estimates on this, and so it's hard for me to stand on top of everything.
27:02
And right now I feel like I'm dropping the ball a little bit on that sense, and so that's what I really want to work on.
27:08
So working on training up the
27:11
the field staff to be pretty strong where I don't need to be out there.
27:14
And I know for like, I feel comfortable that they'll get all the scheduled work done every day and the weeks, you know, revenues hit.
27:22
And I can go service the estimates and start filling the schedule for, you know, the next month and taking care of things.
27:28
And what does chaos look like for those guys?
27:30
Like when you say, hey, I'm managing them, you're not out there doing the work.
27:33
Is it like stuff going wrong, mistakes happening, equipment failure?
27:38
What are you like, what's the firefighting look like?
27:40
I would say more so of just getting like just an extra hand on site, just getting the job done and getting everything done without the day going super long.
27:50
And then also being
27:52
more of like a detail oriented, pointing out little things that I notice, like say, they don't pull all the little picky weeds, little mulch on top of it, like being out there to reiterate those things and you kind of get a feel for how it's going firsthand.
28:07
Good morning.
28:08
Good morning.
28:09
May was a really good month for us.
28:12
A lot of things I liked, and some areas I would like to see some improvement.
28:16
The client communication reviews have been really well.
28:19
A lot of clients are really stoked.
28:21
They're also noticing, Kyle, I think you're talking to the clients, ringing the bell.
28:24
They are loving that.
28:28
All right, let's have a great, great tour in one weekend time.
28:31
It's summer, it's the weather's gonna get a little warm.
28:34
Pack plenty of waters.
28:35
We'll do our best to bring cool drinks to the job sites.
28:39
So a lot of, like, fine details of training, end of day, you're having to help them wrap things up.
28:45
It's like, hey, this job's gonna go to seven unless you go there and get done by six.
28:48
Yep.
28:49
And kind of like delegate tasks.
28:52
Say the job's wrapping up and we have a crew of eight guys.
28:54
We really don't need eight people there.
28:55
So three people can go start the next job or something.
28:58
And that doesn't really happen unless I'm kind of pushing that forward.
29:03
And why does a job go over that long?
29:05
Is it just like the job was misquoted?
29:07
The budget hours are inaccurate.
29:08
They got behind.
29:10
Like, what's the reason that you're getting pulled or you're pulling eight guys to a job that should have three?
29:14
Usually we need all eight, it's more of having eight solid guys.
29:19
So we lost a couple guys that are with us working on training them up, and so that's kind of pushing things back and just requiring me to go out there.
29:27
It's not so much as the quality.
29:30
Our field managers are really good at withholding quality.
29:33
Any additional notes from field managers?
29:35
Anything you want to address within the team?
29:37
Two, just the weed whacking.
29:39
Make sure to leave back the edges, please, before we start mulching.
29:42
Get underneath the plants.
29:43
You're not gonna get underneath the plants.
29:45
Then don't do the plants.
29:48
Going back and redoing stuff and grabbing mulch out of the trailer after you guys have already cleaned up, so.
29:52
They got that, but more so just extra hands, just keeping things moving.
29:58
My eye pulled in the field right now more is just to keep the days from going super long.
30:02
The guys work really well.
30:04
It's just, it's like short-handed.
30:05
But you like hiring people and recruiting.
30:09
And so finding people I'm gonna guess seem is not a huge problem.
30:13
No.
30:13
It's training them, getting them up to a certain level of competence.
30:16
Yep.
30:17
Yeah, and then also they, so like one, I'll give you an example.
30:21
We had one guy, he came on board, I knew this was gonna be an issue, but I didn't address it.
30:25
He was a shoe detailer.
30:27
And we told him that
30:29
or like shoe cleaner, whatever.
30:31
He called him a shoe detail cobbler.
30:34
And so we told him that, hey, like we are known for our attention to detail here.
30:37
And he was like, we didn't, but we didn't give him an example of what our attention to detail is because in his line of world, his attention to detail is microscopic, right?
30:46
We had to let him go because he would spend an hour, you know, with one wheelbarrow where the other guys have moved 26 wheelbarrows each, right?
30:52
We was like, well, you're hiding from my attention to detail.
30:55
Well,
30:56
You know, not that level of attention detail.
30:58
So I was like, okay, wait, we gotta show these guys what we actually expect and we can't assume anything.
31:03
I think that's where we're struggling.
31:05
I have a really famous saying, it's called double cheesing.
31:08
And it's like when you're double working, you know, he was a big double cheeser.
31:11
So he would like really take his fine time trying to spread the mulch, you know, almost like he was spreading concrete.
31:17
You know, he wanted it nice and flat.
31:19
You know, he was just kind of double-cheasing on that, you know, while you had everybody else, you know, halfway done with the property, you know, because he would just really take his nice time, you know, which is nice.
31:26
But at the end of the day, you know, you kind of got to get the ball rolling a little bit, you know, especially if you got your other guys, you know, really pushing and, you know, you're on the same bed, spread it on your hands and knees for 15, 20 minutes, you know, it takes up some time and just wasn't a good fit, you know, but.
31:42
It happens.
31:43
You gotta pick up the guy.
31:45
You're never gonna know until you pick him up, you know, hire him, give him a chance.
31:49
Right now when you're bidding on the project, I'll talk about landscaping for now, because lights is a little bit of a different beast.
31:54
But for the landscaping side, do you use budget hours?
31:57
How are you bidding the jobs?
32:00
This is our subject.
32:00
I would like to.
32:03
I think our vision maybe sometimes isn't clear on different topics.
32:07
And before it was fine because it was just me, him, and you know, some- Small crew.
32:11
It was small crew, but now that there's more people involved, we might not be seeing everything, it's really driving everyone nuts.
32:16
because they, like the way he will say to handle a certain situation might be different than the way I would say to handle a certain situation.
32:22
So if you go to a job, or I guess you go to a job, and you're looking for mulch and salt, is it like, okay, I think it's gonna take X amount of yards and X amount of hours, is that essentially, how does it work now?
32:32
Purely, depends on the service I'm quoting.
32:35
For mulch, it's purely yards.
32:38
Okay, how many yards and multiply it by a dollar amount?
32:40
Yeah.
32:40
The crew though is not using any sort of budgeted hours.
32:43
Like they're not saying, hey, this job is allocated eight hours a day, six hours, four hours.
32:47
Some jobs, if it's one that's quoted by hours, we'll put in like this is estimated for blank amount of hours.
32:53
And that kind of gives them like a mindset to kind of shoot in between.
32:57
But we don't like structure out the day like this should take this long, it should take that long.
33:01
Okay.
33:02
Yeah, it's funny.
33:02
I actually think having paid for performance actually solves your leads problem.
33:06
Because right now, when you're putting a job on the schedule, the crew is essentially incentivized to take as long as possible because they make more money.
33:15
There is no incentive to do this faster, do it efficiently, or make sure there's no mistakes.
33:19
Because why?
33:20
Paul's come clean up our mess.
33:22
And it's not a matter of them doing a bad job.
33:24
It's a matter of making an environment where they actually want the job done efficiently and to a high quality standard.
33:30
And right now, there's no incentive for that.
33:32
Like the longer they clock in, the more money they make.
33:35
And so like, yeah, the job will go until six or seven o'clock because they make more money.
33:38
They're now in overtime.
33:40
And so you'll go protect them because you're like, I don't want to work in overtime this week.
33:44
When in reality, they could have got the job done faster.
33:47
Like they didn't really need the 45 minute break four times throughout the day.
33:50
A lot of people wonder why I'm so passionate about pay for performance or P4P and why I created it, why I wrote the book, why we have all the free training, why I created the software.
33:58
It saved my business.
33:59
And after I had the workplace accident and got caught underneath a dump truck because I didn't have systems in my business, it was the first thing that I implemented.
34:05
And the next year, I went from being unprofitable to making over $280,000 in owner's distributions from the same business with less employees out in the field.
34:15
And that's why I'm so passionate about making sure that this fundamental system of P4P is implemented in every business.
34:21
Yeah, I kind of think that we have our crews kind of special in that sense.
34:26
Maybe I'm just totally blind on this, but...
34:32
The crew leader's been with us for a while now and very trustworthy, and they don't, like our crew guys put their phones in the truck, put their heads down at work.
34:40
Like they are hard workers.
34:43
That is an issue with the newer guys.
34:44
And they even bring it up that the newer guys are, you know, taking much longer lunch breaks than what's typical here or lollygagging or whatever.
34:52
But like our core group of guys, like they're phenomenal.
34:54
Like we haven't had to worry about any of that with them.
34:57
What you want to do, though, is create a culture where those people are incentivized and make more money.
35:01
The new guy either gets flushed out within a week because no one wants to work with them, or they rise the occasion and stop being the person that's dragging them back.
35:09
This business was built on my gut and then having those good guys in the field, right?
35:14
And that's not sustainable because your business is built on systems, not...
35:18
Just a few guys.
35:18
Yeah, yeah, yeah.
35:19
A few solid core groups.
35:20
And you can keep those solid core group of guys, but what you don't want to do, the most discouraging thing for them is to put losers with them that are not incentivized, that churn out fast, that are not trained, that don't care about the quality of the lyrics, that don't care about how fast they go, and they're over here just hustling.
35:34
And I would like to make sure they get paid more than a few dollars more per hour than the person who's lallygagging.
35:39
And so that's where, like, the pay for performance part, as much of it is, well, I trust my team.
35:42
I do too.
35:43
But the minute I walk out of here and then hire five people that I've never met before because someone else hires them, I need to make sure everyone's talking, like, walking the same beat of the same drum, which is we're efficient and high quality.
35:53
And pay for performance will help do that.
35:55
And the bigger thing is not so much the efficiency part for you.
35:58
It's actually the fact that it is very hard to schedule.
36:02
when no one cares about the budget hours.
36:04
I remember before we had P4P, that year, being so frustrated because I knew there were people on my team that were making one or $2 more per hour than someone else, but they were probably producing two to three times more profit for the business because they were efficient and they were constantly hustling.
36:21
And I'm like, this is not fair.
36:23
And then someone else come along and ask for a raise and they deserved it, but I couldn't afford it.
36:29
We weren't making any money.
36:30
And I said, there's got to be a way where based upon how hard you work and how much money you make this business, that's what determines how much I pay my employees.
36:37
They're like, well, I'll work 40, 50 hours a week.
36:39
I'll get paid.
36:40
They don't care how long the job takes.
36:42
It's very hard to schedule.
36:43
And so you're going to have downstream effects of like not being able to hand off admin stuff and scheduling.
36:48
And it's going to be hard for him to even schedule like estimates because he doesn't know how the jobs are going to finish at the end of the day.
36:52
Whereas when you have budget hours and your crew knows budget hours and they're getting paid based on that.
36:56
When you pay someone based on how long the job's going to take and how long it should take, they always get it done on that.
37:01
There's no like, oh, we're working till nine o'clock tonight.
37:03
It doesn't happen because like everyone knows this job is 48 hours, there's four people in the job.
37:08
We're gonna be there for a day and a half.
37:09
Like it's very regimented and you can schedule weeks in advance of knowing exactly which day we're gonna be on the schedule at someone's property.
37:15
So I'm, yeah, I'm fully agree.
37:17
Like I've been wanting to do budget hours for a while now, but I haven't been able to come with the system to create those budget hours properly.
37:22
So how do you?
37:24
You're doing it now, just in a different way.
37:26
Right now you're like, hey, we have this flat kind of dollar per cubic yard for mulch.
37:30
And it kind of, we just move the number up if we think it's to be harder access.
37:34
I just wanted to find that.
37:35
I wanna be, okay, instead of just having this flat rate per cubic yard, I want you to say, what are our costs?
37:41
Mark up the costs.
37:42
So instead of charging $100 per cubic yard, let's, for being installed, let's just charge $50 per cubic yard to cover our costs and have material markup.
37:51
And then, that'll be our materials.
37:52
And then we'll have budget hours.
37:54
And we charge a certain rate per hour of work.
37:57
So let's just say it's 120 bucks an hour.
37:59
Okay, it's eight hours.
38:01
$960 of labor, it's 10 yards of mulch, that's 60 bucks a pop, $600 of materials.
38:06
I had $600 of materials, 800 and whatever I said, of labor, boom, there's your bid.
38:11
They also looked at jobs like, they said 16 budget hours of this?
38:14
Dude, we'll do this in five.
38:16
And it'll get paid 50 bucks an hour for that day.
38:18
Yeah, that's cool.
38:19
That's really cool.
38:21
And so now the goal is like, I get the job, I'm looking for areas to make this faster and make it more efficient, not just be like, eh, if I don't get it done, Paul's gonna come bail me out at the end of the day.
38:29
We've actually tried to dabble it with the guys in the past, and like really only one seemed interested, the others seemed a little standoffish.
38:36
And so I know it's the right call because I'm always worried about labor exceeding our allocations, right, budget.
38:42
So like I know it's the right call, and I know it's what we need to do, and I'd feel much better about this business.
38:47
if everyone was aligned.
38:48
I'm just nervous about taking the time to implement it, the feedback, and just kind of going through all the growing pains of implementing something like P4P.
38:56
Like if you're doing a plant job, you're putting, you have your plant markup, and then you have your labor, and it's not the whole job, it's just, they're getting 33% of labor revenue.
39:06
Of labor revenue, got it.
39:07
And that's why they look at budget hours, because okay, 10 budget hours, okay we make $100 per hour, that's $1,000 for this company, I make 33% of that, we're making $333 today.
39:16
What profit margin are you seeing a lot of home services businesses running?
39:21
Like for like general maintenance, mulch?
39:24
Unfortunately, mostly like zero.
39:26
Really?
39:27
But yeah, like the average home service business is still single digit profit margins.
39:31
And so you can get above 20.
39:33
But if the reason it doesn't is because all of a sudden, if labor is 60, 70 percent of my revenue, I'm not making money.
39:39
And so that's why if you look at last year and you just take how much you paid in wages, look at your labor revenue and figure out, oh, it's like 40%.
39:45
Okay, that's not so bad.
39:47
If I gave 35%, I know I'd be better off.
39:50
And so when a crew member makes 50 bucks an hour, I don't care, let's go.
39:52
Because it's still 35%.
39:53
Yeah, it's locked.
39:55
And so now when you look at a job, you know the profit margin before you start.
39:57
Because you know the cost of materials and you know the cost of your labor, assuming they beat budget hours.
40:01
And that's why you want them to be making more than base pay.
40:04
You want them hitting budget hours.
40:06
Okay, if you don't mind, I don't want to stay off track.
40:08
You're fine.
40:08
But this brings to one of the questions I had for you.
40:11
And I've heard you mention in one of your videos about admin should be no more than 10% of revenue.
40:16
But how do you justify or know when to go over that percentage?
40:21
Because you know you're growing.
40:22
So in the beginning, you hire an admin person that you may not need right now, but you know in three months you will.
40:29
So your numbers are skewed.
40:31
How do you handle that?
40:32
Are you always like, it's 10% or I'm not hiring anyone?
40:35
You know, grow sucks cash, and I allowed 15% for all admin-related stuff.
40:41
That includes my rent, my shop space, the wages, which is the biggest part of it.
40:47
10% is good.
40:48
5% is lethal, but you're only going to get to 5% to your point when you're not growing super fast.
40:53
You're not spending much money on ads.
40:55
You're very much in profit mode.
40:56
You've cut out all the services that are not recurring.
40:58
Like, that's very, very low.
41:01
And so I would not take that benchmark as gospel as much as I want it to be as low as possible, but I understand that I will need more admin if I'm growing.
41:10
And now if it's 25%, we have a problem.
41:12
Sure.
41:12
But I would not look at the gospel truth.
41:15
I would just look as a benchmark because I've seen companies that do 20% an admin and they still make 20% profit, but they're HVAC companies.
41:21
So they're charging 250 bucks an hour.
41:23
I've also seen the opposite when it comes to cleaning, where they have a 5% because there's not a lot of admin, it's all commercial cleaning, and they still have no profit margin because their labor is 70% of their revenue.
41:33
So it's a decent rule of thumb, but I would not stick to that.
41:38
I mean, even, and it sounds so silly, but I just want to question that from Mike, and I'm on his bookkeeping wait list.
41:44
We're on a third bookkeeper.
41:45
Start off great, but then just slowly, I think this is one of your questions too, then they'll slowly just kinda like go into the shadows and things start getting missing or not doing something properly or whatever, and it's just really frustrating because once again, we have more people now, and we're having to work more and more than we ever had to, like why am I,
42:01
Why am I in our balance sheet trying to figure out what's wrong when we have a bookkeeper?
42:04
Or why am I trying to get payment from a customer when we have someone that's supposed to be following up with invoices?
42:11
Or why am I calling a commercial client to get their LIFO contract approved when we have someone?
42:17
that is supposed to be handling this.
42:19
So clearly there's something I'm doing wrong with that, which I'm trying to figure out what it is.
42:25
There's a lot of crossover and it needs to be simplified.
42:30
So I'll give you just another prime example.
42:31
So sometimes he'll do an estimate, right?
42:33
And he'll send the estimate out.
42:35
And then the question comes back to Lori about his estimate, it goes to Lori.
42:40
Well then he had to run out on the field to go take care of the guys and we gotta get back to the customer.
42:44
So then I'll respond to the customer.
42:46
How are you seeing that message?
42:47
Glory forwards it to me because he's out in the field.
42:50
Okay, yeah, that's just role delineation, right?
42:53
Like right now you guys are doing everything together.
42:56
Are you doing estimates or are you not?
42:58
Are you doing estimates?
42:58
Are you doing operations?
43:00
Who do I contact from the admin perspective when there's a problem with admin, when there's a problem with operations, the crew, there's a yellow slip, like having clear routing.
43:08
Like that's why making the admin your router is important because then they have to know who do I contact.
43:13
And if there's an hour delay because he's busy, that's fine.
43:16
We never cross roles.
43:18
I think that's also where the burnout is coming from, is because we're trying to build it so that people have clear roles and not wear many hats.
43:26
We're still wearing a bazillion hats when we're supposed to be getting away from that.
43:31
And we should, you know, so how, yeah.
43:34
Where's the disconnect?
43:36
This is where we're really struggling with, I would say, now is,
43:42
the delegation of those tasks.
43:44
What's the workflow that you built so that everything works flawlessly together and people may not be in the same room?
43:50
Yeah, so that's the hardest part about Command Center because you have 80 plus agents doing 200 locations, right?
43:56
So every single time there's like, something falls through the cracks, how can we solve this without changing everything?
44:01
So for example, in the case of the payment thing, you just make a system that when payment comes in, the minute it comes in, it must be recorded.
44:08
It doesn't sit on your desk for an hour.
44:09
Also, we just don't take checks because then it is instant.
44:12
Right?
44:13
So like there's certain systems that instead of like, I'm going to create the system around like, OK, when a check is here, then we have this Slack channel, then I have this auto, versus like we don't accept checks.
44:22
So sometimes you just can eliminate a whole like, I need to create SOPs for this, versus like, can we just take this out completely and remove the variable?
44:32
That's awesome.
44:32
Is your command center like the one that's relaying that message to the customer explaining like, hey, we don't take checks?
44:38
Like, how does it, what's your process like that?
44:40
Yeah, it's just like, hey, this is our process.
44:41
Like, honestly, if someone's like, I wanna pay a check, it's like, we don't accept check.
44:44
Do you really think they don't have a credit card?
44:47
Right, yeah.
44:47
They would have died during building.
44:49
Yeah.
44:49
Right, so like,
44:51
I would just, like, you just stick to your system on the upfront versus, let's solve the 20 things that could happen wrong if they send a check.
44:57
I would say the hardest thing is things change a lot.
45:01
They're rapidly changing.
45:02
And so trying to keep up with, we're going to do it this way, and then we're going to do it this way, and you know, and I'm kind of like, okay, what would you like me to do this week?
45:12
Just miscommunication is the...
45:15
Biggest problem that we usually have, we don't want to come back and do something because we forgot something or something was missed or wasn't communicated correctly.
45:25
Those type of changes.
45:27
So when I'm the one that's on the phone with the clients, it's like, okay, well, I know I told you this, but now it's this.
45:36
So there's that part of it.
45:37
It's my credibility.
45:38
So how do you, I mean, just kind of going back to the same thing, but how do you ensure then that when a customer calls your command center, right, or works with your estimator this year versus last year, that's the exact same experience?
45:49
Because I think part of my frustration right now is I would like that to be this business, but it depends on who you, if you talk to Lori, me or Paul, like his estimates look different than mine, like what Lori might say or the way she responds might be different than the way I respond.
46:03
How do you ensure that
46:05
Whoever you're hiring is following the exact procedures that you, or standards that you have set up.
46:11
Yeah, you can always create ways and guardrails to make sure that happens down the road when you have multiple people, for example, answering the phone.
46:17
Or, right now, have 1% answer the phone.
46:21
So in your level, it's not a matter of, we need to create a system for this.
46:25
It's like, we need to create a constraint that you guys don't answer the phones.
46:29
As the business grows, if communication is filtering throughout all levels of the leadership team, you're just gonna be compounding how many times every single customer gets touched.
46:39
So if someone has a complaint and it goes to one person, they are the router for
46:43
Who should actually this complaint go to?
46:45
Not let's all be aware, be problem aware, all give our opinions, and all of a sudden, we're wasting three, four times as much time on that problem compared to just one person knowing about the problem and then finding the solution.
46:58
And then what will happen is as you scale, you tell that person in that position, they are responsible to create the SOP to duplicate themselves.
47:06
Okay, you want to become an office manager?
47:08
Great, we're now at $2.5 million.
47:10
We need more people to answer the phone because we're falling behind.
47:12
You're going to become an office manager.
47:14
Here's your incentives.
47:15
In order to get this, you've got to create an SOP for these tasks so you can delegate and give it to someone else.
47:19
And now they just copy their skills to someone else.
47:23
Not three people, like it's impossible to systematize.
47:26
The other part of it is, if there's something that's a challenge that you have to deal with, you put in the time up front to set up the system.
47:36
And while that may slow the process down, you've set up the system and now the system runs for you.
47:42
So you've saved time here, ongoing, by investing time up front.
47:48
Be able to provide the answers.
47:50
Because Lori's busy nonstop.
47:51
She comes in here Monday morning and leaves Monday evening and just slams.
47:56
So I just figured out that aspect of reworking the workflows.
48:01
But once it's set up, then you know where you're headed.
48:06
And the only thing that complicates that is then if massive changes get thrown in.
48:11
Because then now your system's not...
48:16
You know, I think maybe she's doing a lot of the scheduling work right now, so if she's more client-focused and Paul handles the schedule, I think I could see that really working really well.
48:24
I'm just worried about overloading Lori's workload at the moment.
48:28
Make sure she's great, and then as you scale, you say, your job, like part of someone moving up in the next position is their 30, 60, and 90 days is creating the SOPs for someone else to come do their job.
48:39
No problem.
48:39
Yeah, I think we started doing really well in that crossing rules, and then the workflow started going crazy.
48:45
So we lost to employees, kind of needed, and he started picking up things where I was dropping the ball, and I'm coming.
48:53
Everyone's kind of everywhere.
48:54
Yeah, and you notice I haven't wrote anything down while you've been saying all these things because these are all downstream effects of not having paid for performance.
48:59
After our pay for importance discussion, most of the questions I had, I kind of just would answer themselves.
49:05
Right, because if you solve that problem, which is a very hard thing, you have to restructure the way you do debt estimates, the way you communicate with your team, the way you talk about compensation, the way you hire.
49:13
If you change that, though,
49:15
Now what happens is less of you out in the field, meaning now you don't have to create a system around how the admin doesn't hear from you for three hours.
49:21
So let's not figure that out.
49:22
Let's just figure out the fact that why are you gone for three hours and out of touch?
49:26
So I don't wanna be on here with the weeds of like, what about this problem?
49:30
This is all a downstream effect of this problem.
49:33
And that is your crew has no incentive to get the job done fast, efficient, or to a high quality.
49:38
It all is still falling on you.
49:39
Because if that solves, you get time for estimates.
49:41
You get time to be able to respond to admin.
49:43
You no longer need to cross over roles.
49:45
I happen to believe if you had time on your hands, you wouldn't have to step in.
49:48
Yeah, and I think I got to first clean up our services, just clean up the stuff all over the place and just really simplify it.
49:52
So that would be a lot easier for her to just take on all client medication.
49:56
But yeah, I'm all for it.
49:57
having the clients having one phone number to contact, one email, and one person to deal with.
50:01
I only have three things for you.
50:03
It's really simple.
50:04
I think you can do it in the next six weeks.
50:05
Implement pay for performance, get videos of all the estimates, attach it to the client's profile so the admin can see it.
50:11
That video goes with the crew.
50:12
Between the job notes and the video, the crew should be able to do the whole job and not bring you in.
50:16
If they do, system failure.
50:18
That's like red alert.
50:19
If you have to come back on a job site.
50:20
If they need clarification, whatever.
50:22
It's like I either made the video incorrectly or there's not enough clarity in the notes.
50:24
Third thing, centralized comms to admin.
50:27
Between those three things, every single other thing you've talked about will get solved.
50:31
At our size, how many... Is it reasonable to think that one admin person can handle this or would you need two?
50:38
I think right now you have a lot of admin bloat because of a lack of systems.
50:42
And so at your size to have as many people in overhead as you do is too many, in my opinion.
50:46
I don't think you need to get rid of anyone.
50:48
I think you can grow, though, to 2.5 to 3 million without getting any more people if you have systems in place.
50:53
Sure.
50:53
Right?
50:54
And so I believe that right now what you see as efficient, which is them asking you questions, could all be done without that process and get their time back.
51:02
You guys are wasting so much time yourself.
51:05
You're wasting a bunch of their time.
51:06
Yeah.
51:06
because they don't know what to do, they're unconfident, they don't know who's contacted them, there's no record, I'm assuming you guys don't keep call notes inside of the account.
51:14
Like if someone calls you, yeah, you can't do that.
51:17
Lori's pretty good at it, I'm not good at it.
51:18
Because you're out in the field, right?
51:20
That's why you don't- I don't have the time, I can't.
51:21
Yeah, don't let you do comms.
51:23
Yeah.
51:24
Let the office do the admin stuff so they can keep track.
51:27
Like we have, over the course of years, we have call notes that are pages long.
51:31
But it's searchable database that I can quickly find, oh yeah, two years ago, we did tell them that.
51:36
but everything is documented because it's going to the admin.
51:39
It's never going to be documented when you're out in the field or doing an estimate.
51:41
You're like, you're quickly answering a call from a customer.
51:43
You're not going to document that.
51:44
And over the six months, if you adopt the systems where these things are, like, notes on the job will happen as a byproduct of doing this.
51:52
That's why I'm just trying to chunk this all up.
51:53
So if we solve these three things, almost everything we've talked about gets solved.
51:58
And everyone will, like, I could create a system around how to make sure your emails get routed to the right person, or just like, why do we have these emails in the first place?
52:05
And so I think that's what I'm trying to attack is very much a chunked up problem.
52:08
You will have a whole bunch of other problems down the road trying to get these things implemented, but everything you've talked about will be solved by these three things.
52:14
Many times the reason a small business stops growing or plateaus is because the entrepreneur is solving the same problem over and over again out of wanting to feel productive.
52:25
So the things on their to-do list is a lot of the stuff they keep doing the same all the time.
52:29
Instead of focusing on the big problem, the big hairy thing that's gonna take changing the business model,
52:35
changing how everything is done.
52:37
And right now, for Matt, that's paid for performance.
52:40
And we can talk about the systems and the automations and tweaking little things in admin, or we can just attack the big 600-pound gorilla that if he'd spent an entire year focused on, we'd be able to have a huge jump for the business.
52:53
But a lot of us will stay where we're currently at because we just enjoy solving problems, and it's easier to keep solving the same problem 100 times instead of focusing on the one big hairy thing that, if solved,
53:05
would change the business.
53:06
That all goes back to this, and that is the reason those three things need to be done is because you're going to quit this business by a death of a thousand cuts of not wanting to be here, and doing those three things, which will be hard, all three of those will be hard.
53:19
If you do them, though, you'll be able to have time to do things that you do love in the business, and if you do things that you love in the business, you won't quit.
53:25
You're right.
53:26
Absolutely.
53:27
Yeah, you're right on.
53:29
And so I also think that if you have some time and you get that time back, you will get more clarity as a leader in terms of why does business exist?
53:37
What am I doing here?
53:39
Like all these existential questions that happen when you're 25, like I understand where I got them all too.
53:45
You will have answers for them.
53:46
Sure.
53:47
And so when it does get hard and you're like, this is a lousy time, you'll push through it because you know why you're doing it.
53:52
Right.
53:52
Absolutely.
53:53
Right now we don't know the size of business we need.
53:55
We don't know why this business needs to get any bigger.
53:58
We are going to grow sustainably.
53:59
Don't know what that means.
54:01
These are bundled terms that we have no definition for.
54:04
Sure.
54:04
Because I want to have good culture.
54:06
What does that mean?
54:07
Does it mean I have a career progression?
54:08
Does it mean I have a certain amount of hourly rate?
54:10
Does it mean I can offer benefits?
54:11
Like, what does that mean?
54:13
But like you can't do that when you're chasing your tail around who's contacting a customer about a wreath that fell off.
54:18
I just don't want you to quit.
54:19
And I say this because as soon as I say here, I know someone is not loving the business.
54:24
Especially you have so much options being so young.
54:26
Like you will leave it a heartbeat if you fall in love with something else.
54:31
And you fill in the blank of what that is.
54:32
It could be a girl on the other side of the country.
54:33
Like, I'm moving, right?
54:35
I want you to be able to love this business because when you do, you will deploy discretionary effort towards it.
54:41
And when I see a business that has grown very quickly and then plateaued, a lot of times the owner has stopped thinking about the business when they're in the shower.
54:47
And I don't mean thinking about, like, I need to do the billing.
54:49
Like, how do I solve this constraint?
54:50
What system can I do?
54:52
What can I – what exciting – what gets me excited about this business that has disappeared?
54:57
Right?
54:58
And I want you to get that back by getting rid of a lot of these things that you currently hate.
55:08
Okay, he talked about we didn't have any ad spend, no low speed on getting to the requests, and then no pay for performance.
55:16
The biggest things that we've improved since Mike was here was we haven't necessarily done the videos for estimates, but we've really improved the pictures using company cam, the notes.
55:25
the measurements and really getting all the details with pictures for the guys and really spend the time to put the notes in company cam so that when they approach the job, it's like all those pictures pull up.
55:36
So not quite there at the videos.
55:37
I would say the biggest thing, biggest improvement would be the centralized communication to admin.
55:42
So rather than the client asking Paul a question and Paul responds, and then they ask Lori a question about scheduling.
55:47
And then they might within that timeframe of them asking Lori a scheduling question, then I go back to Paul with something and then Paul forgets to relay that to
55:53
Now we're getting better at saying like, hey, give me Lori an email.
55:57
That's probably been like one of the biggest approvals.
55:59
That's really improved, I would say.
56:00
My inbox isn't as full as it used to be.
56:02
I think the biggest takeaway I got from Mike is, I always thought that people with very successful businesses, you hear about like SOPs and writing them down and everything like that.
56:12
I think that was really constraining
56:14
That thought was really constraining.
56:16
What I found fascinating with him was he doesn't really get into the nitty gritty of how to do something.
56:20
He's just very clear on his expectations and very clear on his goal.
56:24
He's very clear on what he expects from his team in certain tasks and doesn't get into the tactical so that he doesn't get a million questions either.
56:33
And I thought that was very fascinating.
56:34
Probably the biggest takeaway I've gotten from Mike and I would definitely say my communication to everyone has been much better.
56:39
And it's been much better in the sense where I'm not telling them exactly how to do something.
56:42
I'm telling them the why I want them to do something and the end goal I want of that.
56:45
I think that's probably the biggest breath of fresh air I've gotten from all of this.
56:49
And I also really, what I noticed with you guys that I'm trying to work on is everyone that I talked to at your company had the same shared mission.
56:56
Like they all are all on the same page, they're all on the same team, they all have the same goal, the same value.
57:01
So that's another really big takeaway that I'm trying to slowly implement here too.
57:05
We did come up with a really good training program that's also very clear before it wasn't clear.
57:10
The way Mike communicated and how clear he was was really, really sparked me again.
57:16
I was blown away.
57:18
So that kind of just like,
57:20
Like now I'm really excited with the business because it's more of like upgrading my skill set and not so much about like all the garbage you deal with.
57:26
Like that's why I'm kind of like excited again because I feel like we're going into a new phase and we have to, you know, become the person that can operate in the next phase.
57:37
So I think that's why I'm like excited again.