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I Turned Away My First 3 Leads... · Home Service Millionaire with Mike Andes

• 0:00
  One week ago, I moved from Washington State to Texas to build a $1 million lawn care business in one year.
• 0:06
  And I want to recap the past week because I felt something that I've never felt before.
• 0:10
  And I think a lot of home service business owners feel this pressure when you want to grow to add more services.
• 0:17
  And I've talked about before how I think that one of the biggest kryptonite for home service business owners is adding more services.
• 0:25
  But I felt in a way that I haven't before this week because I've started from scratch and I'm dramatically reducing how many services I offer.
• 0:34
  When I first started Augusta Lawn Care, we offered everything from putting greens to tree chipping, to installing paver patios, retaining walls.
• 0:44
  We did mulching, planting, irrigation.
• 0:46
  We did everything.
• 0:48
  Now this location I'm starting is very, very different.
• 0:50
  We started running ads two days ago and our ad budget is small to get started.
• 0:54
  I think we've spent four or $500 in the first couple of days, almost all on Facebook ads because Google ads takes a while to get up and running.
• 1:01
  Well, it's funny because the first day, the very first three leads that came in were all for services that I don't offer.
• 1:09
  One was an apartment complex looking for full service maintenance.
• 1:13
  Another person was looking for a property cleanup.
• 1:16
  And then someone else was looking for a project of some sort.
• 1:20
  All first three leads strike out.
• 1:23
  And the challenging part about this is when you say no to services, it really makes it a lot harder to grow.
• 1:29
  Not just in terms of number of customers, but like when you're spending money on ads and you say no to three people, let's assume you're a fourth person, you say yes to.
• 1:39
  What that means is that your customer acquisition cost is four times larger and four times more than if you're just to say yes to all four people.
• 1:49
  Okay.
• 1:50
  And so you can definitely grow a lot faster when you're spending money on ads if you say yes to all the leads that come in.
• 1:56
  Now Google's a little easier because you can make sure that you're only showing up for certain keywords.
• 2:01
  However, when you're doing something like Facebook ads or print marketing or really any sort of marketing that isn't intent based like Google where they're searching for keywords,
• 2:11
  There's going to be times where you have to say no to customers if you're going to be diligent about simple or standardized services.
• 2:21
  Again, you don't have to do basic simple services, but stick in your core few things that you do really well.
• 2:27
  Because I truly believe that so many home service businesses are really just a compilation of 8, 10, 15 different services and then it makes up a million dollar business.
• 2:38
  And the reason that they do that is because you can grow to a million dollars or any side business much faster if you just say yes to all the customers, you offer them more things, you can sell them more things.
• 2:48
  And so instead of a $40 customer acquisition cost, if I have to say no to three people to then on the fourth person say yes, all of a sudden I'm paying well over $100 customer acquisition cost instead of a very cheap price that I could scale much faster with.
• 3:04
  The bottom line is a lot of times, myself included, the reason that we would say yes to services that we know we really shouldn't is because we haven't really done the math.
• 3:12
  We haven't really done the research as to whether or not
• 3:15
  that service in our market can sustain just that one service.
• 3:20
  So like I have done the math of, okay, here's how many homeowners I believe in my market use lawn care.
• 3:26
  Here's how many people I think I'm going to lose because I don't offer irrigation.
• 3:31
  I don't offer bush trimming.
• 3:33
  I don't offer bed maintenance.
• 3:34
  I don't offer planting, all these other services.
• 3:37
  Here's what I think.
• 3:38
  And so here's the math.
• 3:39
  Here's what I can get to.
• 3:40
  And I understand I'm going to have to say no to two out of three people that want my services simply because I don't say yes to everybody.
• 3:49
  That is easier said when you have a whole bunch of services and you're trying to prune them back and simplify the business.
• 3:56
  And I see people do this all the time.
• 3:58
  They build two, $3 million businesses and they're like, I cannot go on vacation.
• 4:03
  I'm working 80 hours a week.
• 4:05
  The whole reason I built this business, which is to spend time with my family, I'm not doing that anymore.
• 4:10
  If someone goes down, like a technician goes down the field, they immediately get pulled into the operations because that one technician does arborist.
• 4:18
  That one technician does irrigation.
• 4:20
  That one technician is the only one that really knows how to operate the excavator super well.
• 4:25
  And so because they have all these verticals in the business, all these service offerings, they grow a $2 million business, but they're handcuffed to it because...
• 4:33
  They can't systematize it.
• 4:34
  It's so complex.
• 4:35
  There's so many moving parts.
• 4:37
  It's hard to train people up.
• 4:38
  They have different vehicles for every different type of service.
• 4:41
  They have box trucks.
• 4:43
  They have crew cabs.
• 4:45
  They have single bed.
• 4:47
  They have cars.
• 4:48
  They have all these vehicles, all the different types of pieces of equipment.
• 4:52
  They have all the different types of technicians that are needed
• 4:55
  to be able to do the different services with different certifications, different levels of experience.
• 5:00
  It's so hard to standardize.
• 5:02
  And after five, 10 years of maybe even being very profitable, by the way, they burn out on the fact that they just don't want to have this business anymore that really operates them, that runs them, that makes them work 70, 80 hours a week.
• 5:17
  They can't go on vacation, all of these things.
• 5:20
  And for them, it's almost a little easier in a way, I feel like sometimes, to be able to rationalize cutting services out because they know why.
• 5:27
  They know the pain of having too many services, and they realize in order for this thing to have any value, in order for me to be able to ever sell it, for me to ever be able to delegate operations, for me to ever be able to pass this off to a manager, I'm going to have to simplify things.
• 5:44
  because they experience what having too many services is like.
• 5:47
  But the vast majority of people, they give up in business or they fail.
• 5:51
  They never achieve success of any sort prior to that point because they added too many services from the get-go and they got so stressed out
• 6:00
  and they may only got two or $300,000 in annual revenue and they burn out because they have 10 different services.
• 6:06
  And all 10 of the services, one's doing 20,000 a year, another one's doing 50,000 a year, another one's doing $5,000 a year, and they do core aeration, they do the leaf cleanup, they do bush trimming, they do mulching, and they're doing all these little services that are really individually, almost like different businesses.
• 6:21
  Like I'm only offering two services, mowing and then fertilization weed control.
• 6:26
  They're like different businesses.
• 6:28
  Totally different setups in terms of equipment, type of technician, the cadence of scheduling, what time of year we do marketing.
• 6:36
  It's a different business.
• 6:37
  And so I can only imagine when you have 10, 15, 20, and I've operated a business like this where it feels like chaos.
• 6:45
  And me now doing that version of business where I built the business to almost $2 million and it literally almost killed me because I got underneath a dump truck on a job site.
• 6:54
  I didn't have any business being there.
• 6:58
  And it almost killed me because I got my hoodie caught in the PTO of the dump truck.
• 7:01
  It literally almost killed me.
• 7:03
  But for many business owners, they get to that point.
• 7:06
  And now with all of that experience, I'm able to now start this location and know that from day one, I'm only gonna offer two services.
• 7:11
  However, the fear of missing out, the FOMO that comes along, we're having to say no to customers.
• 7:17
  I felt this this week for the first time.
• 7:19
  And it's like, ah, this is the feeling that people feel when they just quit their nine to five, they just started their business,
• 7:27
  And their first leads are all asking for services that they don't really want to do.
• 7:32
  But in the back of your mind, like, well, I don't have any other jobs.
• 7:35
  I don't have any other work.
• 7:37
  I'm not busy doing anything else.
• 7:38
  I might as well just do these other services.
• 7:42
  I might as well just say yes.
• 7:44
  And then down the road, I will systematize the business.
• 7:48
  Down the road, I will clean things up.
• 7:51
  Down the road, I will cut back to the three or four core services that I know I want to build this business around.
• 7:57
  And some people survive five or 10 years in the business, in a really complex business, working tons of hours, and maybe even be profitable.
• 8:05
  And they start cutting services back and removing the things that they know they should have never really added and the complexity of the business.
• 8:12
  So it can run without them.
• 8:13
  They can pass it off.
• 8:14
  They can sell it to someone.
• 8:15
  They can have their manager run it.
• 8:17
  But a lot of people make it there.
• 8:19
  And these are the stories I don't think are told enough.
• 8:23
  The people that add so many services, they have a business that is so complex, they're the only one that can run it.
• 8:29
  They're the ballnick to everything.
• 8:30
  They don't ever delegate admin.
• 8:32
  They can't really systematize it because every single job is custom.
• 8:36
  Every single job is so complex.
• 8:39
  And it...
• 8:40
  And I just felt this week I wanted to share, I realized the reason people start adding more services is because when you're spending money on ads and it's the first few leads you're getting, the first customers you're getting, and people are asking for that service and you lose customers because you don't offer extra services,
• 9:00
  That's why people add it.
• 9:01
  And they think that down the road, they'll prune it, down the road, they'll clean it up.
• 9:04
  And all of a sudden they're buying a truck they really didn't want to get, but they have to now because we kind of need a box truck.
• 9:11
  We kind of need a tree chipper.
• 9:12
  We kind of need an excavator.
• 9:13
  We kind of need an aerator.
• 9:14
  We kind of need a leaf vac.
• 9:16
  We kind of need another truck, a different type of truck.
• 9:18
  Oh, we kind of need a van.
• 9:19
  We kind of need this box truck now.
• 9:21
  And all of a sudden, the complexity of the business grows out of proportion to the point where they can never be able to build a business that they love.
• 9:29
  And I would just wish for every single entrepreneur to be able to build a business that they enjoy running.
• 9:34
  That it doesn't run them.
• 9:35
  That it doesn't run them into the ground.
• 9:37
  That it doesn't extract more than it gives to them, their family, their livelihood, to the energy in their life, towards their goals.
• 9:45
  And I'll be honest, this challenge, if it doesn't go well and I don't make a million dollars in a year, if that doesn't happen, financially, I'm okay.
• 9:56
  Now, my reputation is on the line, so you could say that that is far more risk than just the money, and I would agree.
• 10:02
  But I also understand the pressure that if you're under financial stress, why you would say yes to more services?
• 10:08
  Because you just need to get revenue on the books.
• 10:12
  And there are people in the comments that will say, oh, man, like you're doing this wrong.
• 10:16
  You got it.
• 10:16
  You got to put you got to accept the jobs.
• 10:18
  You got to accept whatever comes in your way, whatever's coming to you.
• 10:20
  You got to accept it down the road.
• 10:22
  You can clean it up.
• 10:23
  I have seen that play out so many times that that's what gives me confidence to know I'm doing the right thing.
• 10:28
  And those will probably be the same people in a year once the business is using just two services and is thriving at a million dollars in revenue.
• 10:35
  They'll also say it's luck and it's because of the money that I had at the beginning and all the rest of it.
• 10:40
  But being able to stomach a higher customer action cost and saying no to customers is the thing that allows you to build a business that is simplified, that is systematized, and that you can hand off to someone else and that can run without you.