This 25-Year-Old is Running a $5M Snow Business | Stefano Narducci

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Hey everyone, it's Mike Andes.
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I'm the founder of Augusta Lawn Care.
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We have over 200 locations around the world.
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I'm also the founder of HomeWorks, where we process over a million dollars of revenue every day for home service business owners.
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Today, I am very honored to have Stefano Narducci with me.
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And most of the time we talk about more green industry related things, but a key part of the green industry is what do you do during the off season?
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Stefano has really been a pioneer on the snow removal side of things.
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And so I want to talk about his business today, what they're doing up in Ontario, Canada, with over 40 tractors and scaling a $5 million operation up there and kind of the trials and tribulations to get there as well as what he's learned.
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And hopefully, whether you do snow or not, you're able to learn something from the way they built the business up at Northern Snow.
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So with that intro, I think most people, I'm going to assume most people kind of know you, but give me a little bit of a brief summary of getting into the business and the past five years that has really grown a lot at the business.
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Yeah, so simple summary.
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Started back when I was 19.
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Pulled some tools out of my dad's shed.
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Decided to go start doing some mulching, cutting grass, junk removal.
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Pretty much anything I could do home service related that was simple enough for me to get the basic understanding.
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I would, you know, then go forward and do so.
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Then right after high school?
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Uh, yeah, just right out of high school.
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So anything that was self-explanatory, I was pretty much able and willing to do.
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I wrote out a huge list that I posted on Facebook and just said, hey, this is everything I'm offering for services.
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Texted everybody, put out Facebook, made a logo called the Northern landscaping and just decided to start doing some home service based stuff.
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Right.
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So anyways, um, that was, that was a success.
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Our first summer, we did like $20,000 in top line revenue.
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Then winter came around.
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I was a little bit undecided.
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I didn't know what to do.
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Like, what does the future look like for me next?
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All my friends are going to college, and I felt extremely, extremely alone.
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Over that summer, too, I called my best friend, Nick Sherrod, and I said, hey, bro, like, let's do this together.
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You know, I really want to do this with you.
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He had some great things to offer, and our partnership looked really like we could do something really strong together.
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So when we got closer to the end of the summer season,
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His parents were kind of forcing on him.
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Hey, you should go back to college, which then kind of left me by myself.
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And I'm like, well, what does it look like next for me?
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You know?
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And we get a lot of snow in Sault Ste.
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Marie.
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The winters are long, six months.
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It was around October time.
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Nick was in college.
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I was there sitting by myself.
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And I'm like, well, I don't want this business to go nowhere.
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My parents are looking at me like, hey, are you going to kind of do something?
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Yeah.
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That's when I decided to start a snowmobile company.
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So I went made a logo just on our computer using Wix again I did a little bit of print by mail So printed everything off went handed in everybody's mailboxes got 30 customers that first year did everything with walk behind Snowblowers that we got from our parents and then I
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I had a truck trailer.
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We went house to house, did 30 driveways, got like 15 or 20 K. Yeah, no, no, a little bit more.
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It was actually about 30 K in revenue that, that winter and, uh, used some money that we had saved and made our first down payment on the tractor.
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And then we kind of just exponentially, um, scaled from there.
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You know, it was 30 customers our first year to 175, the next year, 175 to 500, 500 to 2000, 2000, 3300.
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Um,
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3,300, 4,200, 4,200 to 5,000 now.
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So it was like year after year after year.
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Now we're kind of at a place where it's like, I'm really ready for the next chapter, you know?
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So I'm really ready to scale.
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And that's a big reason why I'm here.
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So walk me through last year, because I want to talk about, you grew super fast and we talk a lot about growth creates chaos, growth sucks cash.
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And so walk me through that moment.
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It's actually one of the reasons why I felt so drawn to you.
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And even like, you're actually one of the few people I have come out.
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It's because you were authentic enough to show that that was a rough time in your life.
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And I think for most people in business, especially when they start posting on social media, everything bad needs to be filtered out.
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And then only the good stuff is shown.
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I want to show the bad stuff.
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Yeah.
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And like snow, I know anyone that does snow, there's low moments because it's a tough, tough business.
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Oh, man, it'll put you through anger.
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Yeah.
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Yeah.
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So walk me through last year and what you learned from it most specifically for someone that might be also in this growth phase growing very quickly.
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I was talking yesterday.
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Someone was here.
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His name was Marcus.
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He's out in Idaho growing very quickly.
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Young guy did like 800,000 this year, like 2.3 million is going for 4 million, like very quick growth for that person.
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Speak to that person.
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Tell us what happened last year and then what you learned from it.
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Yeah, I would say that the biggest thing that has changed my entire company around, like there's so much I learned from that difficult year.
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But if there was one thing that I wish I knew throughout that entire time, because I do think there is a place for growth and you could grow very quickly, but you got to make sure your pricing model strong.
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That's where we kind of lost.
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We were severely underpriced for the service that we were providing.
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We could have been priced higher.
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If we were priced higher, we wouldn't have been in a position where we almost went bankrupt.
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Now, there was some other unforeseen stuff that happened, Mike.
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You know, this was the most amount of snow Susana's ever seen in over 10 years.
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And, of course, on my year six in business, I experienced that, right?
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Which is fine because everything that happened last winter, I would not take back for...
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millions of dollars i learned so much as a man so much as an individual and um it was the best thing that ever happened to me and our company uh however if i could give any advice to anybody who's scaling very quickly is just make sure that pricing model is dialed in i mean you recently talked about it on a podcast not too long ago that you did i think it was like around december 12th but
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pricing has became one of the most important things to me.
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And it could really change a business around.
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So if your prices aren't right, your contract's not right with your customer, if you're underprepared, especially in the snow business, like I said, it's not like lawn care.
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You can go grab a couple pieces of equipment and catch up really quick.
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We have a small window.
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You don't have enough manpower.
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You don't have enough machines.
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You default.
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Customers want a refund.
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You go bankrupt.
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That's just, that's how it goes.
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And that's what almost happened to me.
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And to walk me through the pricing model that you use, is it a per push model?
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Is it a monthly model?
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Is it for only the winter or is it 12 months of the year?
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What's your pricing model?
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What do you see working?
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Contract, six months, November 1st till April 31st.
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We used to do five and a half months.
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Then I went to acquisition.com and they're like, that is the dumbest thing I've ever heard.
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And I was like, oh, my ego.
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Okay.
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We're doing six months now.
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Yeah.
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So we do November 1st to April 31st, six months guaranteed coverage, snow or no snow all season long, five centimeters or more.
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We come service your driveway, two passes for premium customers, which essentially means pass in the middle of the night.
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We clean your driveway and we come back around because usually there's continued snow.
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Or if there's not continued snow, we'll come back to clean where your car was parked or if the city plows hit the streets again.
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Standard customers only get one pass every 24 hours.
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Notification sent upon arrival.
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We do that with our software, of course.
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They move their vehicles.
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We do one thorough pass on the driveway.
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Done.
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So six-month contract for us is the way to go.
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Why?
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And I think that you'll appreciate this.
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I want to give the customer the best experience possible.
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And if I'm leaving 5,000 customers...
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up to them to have their responsibility of calling us when they want their driveway done.
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Well, I mean, it's just not scalable.
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We never would be at 5,000 customers.
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We'd be at 250 pulling our hair out.
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So we could provide a more consistent service.
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We could double, triple down on value.
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We can make sure that we run the operations the best way we know and not based off of other customers' decisions of when they want their snow done, right?
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Yeah.
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And what's the average cost usually per month for those six months?
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Um, average cost would be, I don't know, just to pretty well be fair and even 150 to 200.
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Got it.
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Yeah.
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And what's that sales process look like?
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Is it, they call in usually, is it from the website?
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We do a lot of sell by phone.
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Yeah.
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Tons.
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Um, but website gets a lot of leads as well.
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Lots of leads.
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Uh, but you know, most of our closes is over the phone.
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Got it.
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Yeah, for sure.
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A lot of people are sold.
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Like they're, they're ready to go before they even call.
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They're just calling and say, Hey, can I just sign up?
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Right.
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I think we've done a great job of doing that by just like word of mouth.
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You know, that's the best thing you could do in business and build a good business based off service and the word of mouth compound so quickly.
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So we've been able to successfully get customers without even trying to sell them.
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For the ones that are a little bit more difficult, we go through the process of explaining how our standard and premium service works, all the value that we get in over the six months.
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We give them an option of paying full or over six months and then away they go.
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Um, but most of our leads, I would say it's probably a 50 50 between our form on our website, uh, which having a really nice website is important.
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We get a lot of leads through there and then also a phone call.
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Got it.
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And in your model is slightly different for some people comparatively.
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And that is you do the actual tractors with the snow blowers.
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Whereas for a lot of residential or even commercial people will do plows.
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Yeah.
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Plows.
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And so walk me through that logic.
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And I think, correct me if I'm wrong, but did you do plows before or you've never done plows?
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Yeah.
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No, we just get so much snow in Sioux St. Marie that using a plow residentially, like you're not going to be able to do much.
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You know, like the banks just get so high so quick.
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When you pull that snow into that driveway, where are you pushing it?
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When the bank's four or five feet tall, you can't just magically push it up a four or five foot bank, right?
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Right.
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So...
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Yeah, plow trucks for residential don't work.
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So we started with the residential snowblowers, like I told you there.
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And then we came across this model on YouTube.
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YouTube helped me build my entire business.
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You helped me build my business watching your YouTube videos.
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And, like, that's why I wanted to do the same for everybody else watching mine.
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But, yeah, we came across the Montreal model, I call it.
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In Quebec, they were using inverted snowblowers on the back of tractors to do residential homes in a very efficient manner.
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So they were, you know, some companies were doing...
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200 homes in four hours.
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There was companies with 100 tractors doing, you know, 20,000 homes, 5,000 homes, 10,000 homes.
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Like it was pretty common to have a couple thousand homes as a business.
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If you're from Montreal or Quebec area, that's where this, you know, originated.
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And they were very hush over there.
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Yeah.
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very quiet.
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They didn't want nobody to know about the business model.
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They kept it very low key, very, very competitive, you know, just a bunch of starving dogs eating at a one bowl.
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And somebody actually came across the model and brought it to YouTube, which was Nick Bonner.
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And I found his videos.
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And as soon as we found his videos, we went tunnel vision on pretty much doing a copy and paste in our hometown.
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Of course, bringing our own value, bringing our own insight and changing things based on the way we see in the business at a scaling perspective.
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And we just smashed it.
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We smashed it out of the park.
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We build custom websites for home service business owners just like you.
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And you can get a 15-minute free consultation about your website because our team, on average, when someone joins as a client, we increase the number of leads they get by almost double, 80% within the first 12 months.
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In fact, if you go to our website, you can actually go through and see...
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All the different websites that we build for a whole bunch of different home service businesses that have taken their business to the next level.
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Go check it out and book a free consultation call today.
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One thing I find really interesting with Snow, specifically when it comes to home services, is a big chunk of your costs are fixed expenses.
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Being the fact that you have millions of dollars worth of tractors.
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Yeah.
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walk me through the financial model you use for that.
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Because I feel like this is the part where people see what your videos are like, I want to do that.
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And they go buy millions of dollars worth of equipment and realize, oh, I forgot to take it all into account, as well as the fact that for six months of the year, I don't get paid by those customers.
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So walk me through the financial model and then like how you do the financing.
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I know Kubota is a huge representative for you.
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But like walk me through how you make sense of that.
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What do you see as like, okay, I can do X amount with one tractor.
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I'm going to go buy one or I'm going to go finance it.
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And how do you make sense of, I'm going to go out on a limb and probably guess three plus million dollars worth of equipment.
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Yeah.
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Yeah.
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00:11:53.611 --> 00:11:54.072
We got...
223
00:11:56.579 --> 00:12:20.008
roughly if you don't include all the depreciation if we're looking at new value we're we're close to five million yeah we got about five million dollars in equipment i mean what it's worth right now i don't know say fourth between three and four but regardless besides the point um the financial model wow is that ever difficult for this business why there's so much unpredictability um if it snows 25 times in a year versus 40 times in a year
224
00:12:20.508 --> 00:12:25.951
your bottom line profit and the way your finances are going to end up by the end of the season are going to be drastically different.
225
00:12:26.651 --> 00:12:34.656
Obviously, there's safeguards you put in place with, you know, having a snow charge centimeter on your contract or for all the Americans inches, right?
226
00:12:34.696 --> 00:12:37.177
So when you go over a certain amount of inches, you could charge your customer.
227
00:12:37.197 --> 00:12:40.379
Additionally, that's kind of a safeguard just in case if you do have a heavy winter.
228
00:12:40.799 --> 00:12:46.302
But if you end up just in the sweet spot where maybe it snows just enough, but it hasn't hit your trigger,
229
00:12:46.782 --> 00:12:50.308
You know, your 400 centimeter threshold, that's for us in our contract.
230
00:12:50.388 --> 00:12:52.953
Once we go over 400, the customer gets charged additionally.
231
00:12:52.993 --> 00:12:53.834
It's called the surcharge.
232
00:12:54.475 --> 00:12:54.776
Yeah.
233
00:12:55.781 --> 00:13:08.066
You know, with the financial model in this business, what I've found is that if you have a heavy snow year and you're just underneath that trigger or you have a lighter snow year, it'll significantly change the profits of the business.
234
00:13:08.607 --> 00:13:10.948
Everything is fixed for the company.
235
00:13:11.668 --> 00:13:15.930
We put budgets in place based on historical data, which we're trying to get better at.
236
00:13:15.990 --> 00:13:20.032
The number one thing I could tell anybody in this business is just get your data right from the beginning.
237
00:13:20.472 --> 00:13:25.494
Make sure you're really tracking your financials because you'll be able to make way, way better informed decisions.
238
00:13:27.235 --> 00:13:38.565
I've kind of always came from a place, unfortunately, to say I've just shot from the hip, basically scabbed the financials together with me and my partner, Nick, and said, OK, this is what we could we think we could do.
239
00:13:39.065 --> 00:13:39.946
And we just went for it.
240
00:13:40.046 --> 00:13:42.048
Now we're actually trying to make decisions off of data.
241
00:13:42.957 --> 00:13:44.479
Like I said, everything is fixed in the business.
242
00:13:44.499 --> 00:13:52.045
The only variable costs are your repairs and maintenance, your diesel, your fuel for all the vehicles and trucks and tractors.
243
00:13:53.606 --> 00:13:54.046
What else?
244
00:13:54.487 --> 00:13:55.407
Repairs and maintenance.
245
00:13:55.528 --> 00:13:56.088
Damages.
246
00:13:56.488 --> 00:13:57.569
Damages are a huge one.
247
00:13:57.950 --> 00:13:59.851
You know, last year we did a quarter million in damages.
248
00:13:59.871 --> 00:14:02.533
It's just easy to add up, right?
249
00:14:02.573 --> 00:14:04.075
You're servicing...
250
00:14:05.555 --> 00:14:16.847
5,000 homes in a night and you times that by two, that's 10,000 odds of you hitting something times that over 50, 40 snow events, like you're hundreds and hundreds of thousands of odds of being able to hit something.
251
00:14:16.888 --> 00:14:22.714
So you do 20 garage doors, 25 garage doors, a couple of cars, boom, there's a quarter mil.
252
00:14:22.994 --> 00:14:23.974
It's really simple, right?
253
00:14:23.994 --> 00:14:26.855
So we make sure that we put a budget aside for damages.
254
00:14:27.236 --> 00:14:30.497
And that's something I would recommend to anybody that wants to get in this model.
255
00:14:30.537 --> 00:14:35.359
If you're running the tractor with the blower and you're doing volume, definitely put a budget aside.
256
00:14:35.959 --> 00:14:38.820
A number that's worked for us is about 3% of our top line.
257
00:14:39.200 --> 00:14:41.881
We like to put aside for damages specifically.
258
00:14:42.361 --> 00:14:43.882
But yeah, man, everything is fixed.
259
00:14:44.002 --> 00:14:46.823
It's just repairs and maintenance, damages, fuel.
260
00:14:46.983 --> 00:14:52.565
Yes, there's some guys that are hourly, but even the way I pay my guys, it's all, all, all contract-based.
261
00:14:52.745 --> 00:14:54.345
Just like the contracts for the customers.
262
00:14:55.086 --> 00:14:55.266
Got it.
263
00:14:55.286 --> 00:14:56.126
That was my second question.
264
00:14:56.146 --> 00:14:59.087
Like the rise and fall of the snow season.
265
00:14:59.127 --> 00:15:04.649
So during the six months where you're not, they're not on contract, are you still paying for those fixed expenses of the tractors?
266
00:15:04.949 --> 00:15:08.450
Or do they give you some sort of like a six month only expense?
267
00:15:08.530 --> 00:15:09.130
To a Kubota?
268
00:15:09.230 --> 00:15:09.430
Yeah.
269
00:15:09.810 --> 00:15:11.932
No, we pay the same price 12 months all year round.
270
00:15:11.952 --> 00:15:22.942
So I'm assuming it's a huge amount of capital savings required and budgeting and forecasting to make sure you actually have enough when in the middle of August, that thing sitting there most of the time needs to get paid for.
271
00:15:23.202 --> 00:15:27.226
Man, I have just made it through for the last six years.
272
00:15:27.806 --> 00:15:29.528
Like just made it through every winter.
273
00:15:29.628 --> 00:15:31.149
Now, that's not because...
274
00:15:31.830 --> 00:15:33.591
you know, we've sucked as a business.
275
00:15:33.631 --> 00:15:35.792
We were just making informed decisions.
276
00:15:36.152 --> 00:15:40.994
And that's why I'm saying for anybody watching now that's looking to get in the model, make sure your finances are set up from day one.
277
00:15:41.474 --> 00:15:42.915
Go into your first snow season.
278
00:15:43.815 --> 00:15:45.676
Make sure it's a successful season, of course.
279
00:15:45.716 --> 00:15:47.416
Put your contract in place to safeguard things.
280
00:15:47.456 --> 00:15:50.638
Put some small budgets aside that you know that you're capable of working around.
281
00:15:51.118 --> 00:15:55.740
And then after your first season, you will have data to make more informed decisions for your next season.
282
00:15:56.220 --> 00:15:57.901
For us, we never had any of that.
283
00:15:57.921 --> 00:15:59.061
We just scaled, scaled, scaled.
284
00:15:59.141 --> 00:16:00.622
So the reason why we just...
285
00:16:01.162 --> 00:16:09.604
kind of just got by every single year, spring would come around, and we would just have enough money to get to renewal season, was for the reason being is just because...
286
00:16:11.238 --> 00:16:18.401
you know, we were able to, we were just able to kind of make things happen quick enough to get money in the door to kind of save us.
287
00:16:18.461 --> 00:16:22.063
But essentially all of our money just went to growth and that was burning us out.
288
00:16:22.203 --> 00:16:23.684
You know, it was really burning us out.
289
00:16:24.124 --> 00:16:28.046
Now I'm focusing on how can we grow and still make profit?
290
00:16:28.186 --> 00:16:29.767
And that's what this year has been all about.
291
00:16:30.147 --> 00:16:36.210
Just because when you go into countless years of growing your business and spring comes around every single year, you're like, wow.
292
00:16:36.230 --> 00:16:36.530
Yeah.
293
00:16:37.130 --> 00:16:38.051
There's no profit.
294
00:16:38.451 --> 00:16:39.632
All the money just went to growth.
295
00:16:39.912 --> 00:16:40.453
That's cool.
296
00:16:40.733 --> 00:16:45.097
We have more assets, bigger shop, more employees, bigger brand.
297
00:16:45.197 --> 00:16:46.057
We've got a bigger business.
298
00:16:46.979 --> 00:16:47.779
but there's no profit.
299
00:16:48.380 --> 00:16:54.183
So sacrificing profit for scale is something I've been doing since we started.
300
00:16:54.723 --> 00:16:59.805
And this year, I wanted to prove to myself that we could scale and we can make profit.
301
00:17:00.346 --> 00:17:06.829
So I'll be able to tell you a little bit better in the spring because, like I said, again, based on the weather, we get a lot of snow this season.
302
00:17:07.189 --> 00:17:08.910
It's going to kind of impact the profit a bit more.
303
00:17:09.490 --> 00:17:12.252
If it's a little bit lighter, then we might be a little bit more profitable.
304
00:17:12.552 --> 00:17:12.832
Got it.
305
00:17:13.232 --> 00:17:14.213
And one thing, like...
306
00:17:15.378 --> 00:17:16.559
I find really interesting about snows.
307
00:17:16.579 --> 00:17:19.681
You have to also scale up a huge amount for your operators.
308
00:17:19.921 --> 00:17:20.081
Yep.
309
00:17:20.301 --> 00:17:31.348
And I would imagine you get some people returning back, but because the massive quote off season being your summer and spring, I would assume there's a lot of recruiting required to attract 40, 50 people.
310
00:17:31.848 --> 00:17:33.249
And I correct me if I'm wrong.
311
00:17:33.269 --> 00:17:34.810
That was your Achilles heel last year.
312
00:17:35.311 --> 00:17:40.414
For 21 days straight, you guys were going around the clock and people were walking off the job regardless of how much money you give them.
313
00:17:40.574 --> 00:17:40.734
Yep.
314
00:17:40.834 --> 00:17:42.055
Cause the body can only take so much.
315
00:17:42.075 --> 00:17:42.235
Exactly.
316
00:17:42.255 --> 00:17:42.515
Exactly.
317
00:17:42.535 --> 00:17:48.277
What have you changed this year with the recruiting, the hiring, the training process to make sure that doesn't happen again?
318
00:17:48.497 --> 00:17:49.518
Okay, this is exciting.
319
00:17:49.578 --> 00:17:59.721
So, yeah, that was our biggest downfall last year was if I had to just say one thing and just pin it just to the one problem we faced last year that was the most difficult.
320
00:17:59.761 --> 00:18:00.722
It was human resources.
321
00:18:01.242 --> 00:18:02.182
That's what killed us.
322
00:18:02.222 --> 00:18:03.863
It almost actually made us go bankrupt.
323
00:18:04.763 --> 00:18:14.772
So basically some of the safeguards we put in place this year is we hired more operations people to make sure that the guys were communicated with.
324
00:18:15.033 --> 00:18:19.096
We had a front facing human resource gentleman come on board, Gio from Amazon.
325
00:18:19.136 --> 00:18:20.578
He's been doing absolutely incredible.
326
00:18:21.338 --> 00:18:24.761
Mitch is operations manager, so he kind of oversees the entire operations.
327
00:18:25.082 --> 00:18:27.344
We brought another guy in, my cousin Joseph Salerno.
328
00:18:27.964 --> 00:18:36.015
We brought him in to take care of kind of the back end operations, routing, things like that, and making sure that schedules, everything's in place, all that sort of good stuff.
329
00:18:36.416 --> 00:18:40.281
So we went from only having one operations guy last year to having three.
330
00:18:40.301 --> 00:18:43.806
And then as an extra layer on top of that, we brought in a general manager.
331
00:18:44.347 --> 00:18:47.368
So we're literally talking three more salaries here.
332
00:18:48.409 --> 00:18:50.770
As a conjunction, it's a lot of extra money for the company.
333
00:18:50.930 --> 00:18:56.052
We did a large price increase because we wanted to build a more stable business from almost bleeding out last year.
334
00:18:56.613 --> 00:19:03.316
So with the price increase, of course, once you get more money in, you want to figure out ways to give better experience to your customers.
335
00:19:03.696 --> 00:19:07.858
So right away, you're spending on salaries, you're spending on infrastructure, more equipment, all those great things.
336
00:19:08.178 --> 00:19:12.040
So the biggest focus for us was we needed more qualified people internally.
337
00:19:12.680 --> 00:19:35.062
to really help our people out in the field to make sure that they were nourished communicated with culture was one of the biggest things we wanted to focus on and just making sure that our guys had a voice that they could speak to um it's crazy to say but i feel like a lot of men that work in the blue collar space you know they keep a lot in and and they definitely got some things to say and if there's nobody there to communicate with them
338
00:19:35.702 --> 00:19:38.184
They'll kind of just like self-destruct or they'll just explode and walk out.
339
00:19:38.544 --> 00:19:39.845
You've seen it countless times, I'm sure.
340
00:19:40.185 --> 00:19:41.786
The fuses on some of them are really short.
341
00:19:41.826 --> 00:19:45.508
So, yeah, really doubling down on operations has helped us significantly.
342
00:19:46.149 --> 00:19:50.451
Some other huge things that we put in place was two-way cameras and all of the tractors.
343
00:19:51.152 --> 00:19:55.154
We launched our software company, Aurora, which has been an absolute game changer.
344
00:19:55.194 --> 00:19:56.635
Our guys absolutely adore it.
345
00:19:57.356 --> 00:19:59.037
Our internal support team adores it.
346
00:19:59.357 --> 00:20:01.258
We doubled down our internal support team.
347
00:20:01.338 --> 00:20:03.540
We went from having like pretty much two agents to five.
348
00:20:04.540 --> 00:20:33.867
um what else did we do i see the two-way cameras like they where they can basically turn on and talk to the dispatcher from inside their cab no we actually their tablets inside have aurora and zello okay and zello is how they communicate back to dispatch uh and or sometimes they use their cell phone but zello is pretty much our procedure of how they communicate back to dispatch um but yeah the two-way cameras was more for a safeguard and to track damages so let me tell you like the problems we faced last winter and i'll kind of walk them back damages were disgusting
349
00:20:34.747 --> 00:20:37.670
human resources, not enough management.
350
00:20:38.851 --> 00:20:40.812
Equipment was quite prepared.
351
00:20:40.993 --> 00:20:42.874
It was decently prepared enough.
352
00:20:42.894 --> 00:20:49.079
It was prepared based up to the level that we knew, but it wasn't prepared for the biggest snow season that Susamory's ever seen in over a decade.
353
00:20:49.560 --> 00:20:55.525
So, yes, we lacked a little bit there, but Eric Boulin, our shop manager, did such a great job of just...
354
00:20:56.556 --> 00:21:02.602
Staying for endless times for 24, 48 hours straight, making sure that those machines are ready for the next day, the next day, the next day, and the next day.
355
00:21:03.062 --> 00:21:04.784
So that was somewhere we fell a little bit short.
356
00:21:04.844 --> 00:21:06.446
Customer communication fell short.
357
00:21:07.166 --> 00:21:08.388
Service times fell short.
358
00:21:08.948 --> 00:21:10.850
So those were all the main things.
359
00:21:11.170 --> 00:21:13.693
And I kind of just looked at all the problems we had.
360
00:21:14.293 --> 00:21:16.135
I had key man risk too, which was horrible.
361
00:21:16.776 --> 00:21:18.497
Our operations had key man risk as well.
362
00:21:19.318 --> 00:21:23.740
And I'm like, okay, we have major issues in our business, like really, really big issues.
363
00:21:23.840 --> 00:21:26.322
Let me start with the biggest problems and walk them back.
364
00:21:26.822 --> 00:21:28.903
So first I wanted to do everything internally.
365
00:21:29.063 --> 00:21:32.665
Spring came around, everything was done, winter was over.
366
00:21:32.785 --> 00:21:34.626
And I'm like, okay, I got to prepare for next winter now.
367
00:21:35.266 --> 00:21:41.211
I actually started doing it like midwinter, but regardless, I started with wanting to build the company from the top down.
368
00:21:41.231 --> 00:21:47.016
I was like, we need to bring in a general because I'm an integrator, a visionary, a content machine, an operator by night.
369
00:21:47.116 --> 00:21:49.038
I'm like doing everything for this business.
370
00:21:49.098 --> 00:21:52.481
And I wasn't burning out, but I knew that it just wasn't efficient enough.
371
00:21:52.541 --> 00:21:54.923
And like, I was choking, I was choking the company.
372
00:21:54.983 --> 00:21:55.163
Right.
373
00:21:55.783 --> 00:21:59.586
So that's when I brought in our general manager, Anthony Karkidi, brought him in as a partner as well.
374
00:21:59.646 --> 00:22:02.128
And he's been absolutely exceptional.
375
00:22:02.148 --> 00:22:05.070
He's taken a lot off my plate to be a great integrator for our company.
376
00:22:06.712 --> 00:22:10.354
Make sure he goes and finds where the bodies are buried for the business.
377
00:22:11.235 --> 00:22:14.478
You know, anything that I have planned, I push the agenda on him.
378
00:22:14.518 --> 00:22:16.919
We work on it together and he makes sure that it actually happens.
379
00:22:16.939 --> 00:22:18.381
The implementation happens out there.
380
00:22:19.021 --> 00:22:21.962
So that was a huge, huge one was starting from the top.
381
00:22:22.422 --> 00:22:24.583
Okay, let's start from the top and then build it down.
382
00:22:25.003 --> 00:22:28.044
Then right after him, I was like, okay, we got to get a better sales and support team.
383
00:22:28.084 --> 00:22:29.345
We brought in some more people there.
384
00:22:29.725 --> 00:22:31.665
And then right beside that was operations.
385
00:22:31.705 --> 00:22:33.206
We need some more people on operations in.
386
00:22:33.486 --> 00:22:34.506
We doubled down on that.
387
00:22:34.926 --> 00:22:36.327
Shop only has one guy.
388
00:22:36.427 --> 00:22:40.268
Let's get another really, really trained licensed mechanic inside the shop.
389
00:22:40.388 --> 00:22:41.209
We did that as well.
390
00:22:41.769 --> 00:22:43.209
So kind of like a pyramid.
391
00:22:43.229 --> 00:22:44.990
I started from the top and then worked my way down.
392
00:22:45.730 --> 00:22:47.051
Then I went to all the functions.
393
00:22:47.611 --> 00:22:49.313
I'm like, okay, two-way cameras.
394
00:22:49.473 --> 00:22:50.453
We got our software.
395
00:22:51.274 --> 00:22:52.715
Okay, look at all these problems.
396
00:22:52.735 --> 00:22:58.900
We would watch some of the videos, and I had everything documented from last winter, and I was like, okay, here are some of the operational problems we face.
397
00:22:59.340 --> 00:23:00.981
How do we get better in these areas?
398
00:23:01.341 --> 00:23:05.004
How do we increase efficiency but still be able to service our customers?
399
00:23:05.024 --> 00:23:08.246
And that's when I came out with two different models, standard service and premium service.
400
00:23:08.266 --> 00:23:08.386
Yeah.
401
00:23:09.728 --> 00:23:11.050
That was huge for us.
402
00:23:11.290 --> 00:23:24.109
It gave us more efficiency on the operations end, gave us faster road times, and still service our customers and gave them options, which was really, really well for us because we used to just be one service, snowblowing, premium, two passes.
403
00:23:24.530 --> 00:23:26.871
When I introduced standard, it really changed things big time.
404
00:23:27.291 --> 00:23:34.053
It gave guys a little bit of an easier night shift too, which is the hardest because everybody's tired.
405
00:23:34.113 --> 00:23:37.294
And when you go for many of those night shifts, they kill you over time.
406
00:23:37.374 --> 00:23:44.456
So I was able to squeeze down our roads basically to like three and a half, four hours to make one full pass on all of our premium driveways.
407
00:23:44.816 --> 00:23:48.837
And then when we come up for a second pass, we do premiums for a second time and standards for their first drive.
408
00:23:49.017 --> 00:23:57.706
That was a huge operational move that bought us back a lot of time, made the experience a little bit better for the operators, and basically kept them there under 12 hours.
409
00:23:57.726 --> 00:24:05.514
Because I found last year that we went multiple shifts of like 14s to 18s in a cab, you know?
410
00:24:05.554 --> 00:24:06.355
You're killing these guys.
411
00:24:06.395 --> 00:24:06.535
Yeah.
412
00:24:06.855 --> 00:24:08.456
And we have 50 of these guys doing that.
413
00:24:08.596 --> 00:24:09.357
It's not possible.
414
00:24:09.377 --> 00:24:10.017
It's not feasible.
415
00:24:10.037 --> 00:24:10.758
It's not scalable.
416
00:24:11.238 --> 00:24:16.761
So bringing the standard and premium model condensed our road times and made us more efficient.
417
00:24:17.002 --> 00:24:18.563
And we raised our prices too.
418
00:24:18.643 --> 00:24:23.886
So it was kind of like if you didn't want premium at the significant price increase, standard was still an option.
419
00:24:23.926 --> 00:24:25.167
But you're just getting the one pass.
420
00:24:25.687 --> 00:24:26.768
It worked really well for us.
421
00:24:27.068 --> 00:24:43.112
Two-way cameras was to protect the operators, check up on them, make sure that they're out there actually doing, you know, production in the field, making sure they're not, you know, smoking and operating or texting and operating at the same time or things like that, making sure that they're not going around corners too quick.
422
00:24:43.152 --> 00:24:44.652
It's all based off AI technology.
423
00:24:44.672 --> 00:24:46.213
We use Samsara, if you've ever heard of it.
424
00:24:46.833 --> 00:24:48.493
And it's absolutely incredible.
425
00:24:48.533 --> 00:24:50.454
So that was a huge investment.
426
00:24:50.474 --> 00:24:51.754
That was an absolute game changer.
427
00:24:52.394 --> 00:24:54.136
Like I said, the software was another big one.
428
00:24:54.156 --> 00:25:03.446
And then we worked really hard all spring and summer on just adding little 1% improvements to make sure that all of our equipment was prepared for the worst winter ever.
429
00:25:04.107 --> 00:25:10.393
And going into this winter now to kind of keep you up to speed, all of these changes we've made, and I know I'm missing some right now.
430
00:25:10.413 --> 00:25:11.534
I'm just kind of giving you a high level.
431
00:25:12.215 --> 00:25:14.116
We're out there slapping it.
432
00:25:14.696 --> 00:25:16.016
We're just slapping it around now.
433
00:25:16.217 --> 00:25:30.842
Like watching where our company was last December, almost going bankrupt and everybody looking like just the world was crumbling around them and being blasted all over our local news and being blasted all over Facebook and Facebook.
434
00:25:31.082 --> 00:25:33.103
I was still able to film all of it somehow, some way.
435
00:25:33.163 --> 00:25:33.903
God was with me.
436
00:25:34.463 --> 00:25:35.764
And I did get it all on camera.
437
00:25:35.784 --> 00:25:40.146
But that was one of the worst and scariest experiences I've ever faced in my entire life.
438
00:25:40.186 --> 00:25:41.046
And we made it through.
439
00:25:41.486 --> 00:25:45.688
And seeing where we are today right now, we've done 12 snow events so far.
440
00:25:46.488 --> 00:25:48.889
And we're out there like Daytona 500.
441
00:25:49.330 --> 00:25:52.851
We're just like, you know, we're like, we're just slapping it.
442
00:25:52.931 --> 00:25:54.192
We're just doing such a good job.
443
00:25:54.232 --> 00:25:55.512
I can't even describe it to you.
444
00:25:55.552 --> 00:25:56.453
It almost feels...
445
00:25:57.493 --> 00:26:21.390
uh fake or too good to be true um everything that happened last year was meant to be you know god wanted me to go through all those adversities i went through the the toughest six months of my entire life and uh i was happy that i was able to stay resilient and push through it because now the company is in such a great spot and that's another reason why i'm here now i feel like i'm ready to take things to the next level so you know mike could help me do that
446
00:26:21.650 --> 00:26:31.535
Yeah, the one thing I want to talk about for I think a lot of people that might be going through a year like you did last year, whether it be snow season or spring rush or whenever it is busy for them.
447
00:26:32.296 --> 00:26:37.158
And they realize like, hey, I'm either I'm going to nothing or I'm going to quit because this is crazy.
448
00:26:38.019 --> 00:26:43.341
When you were in that moment and you realize that price was the lever you had to pull and it wasn't going to be a 5%.
449
00:26:43.501 --> 00:26:44.822
No, we went 30.
450
00:26:44.842 --> 00:26:45.602
Adjustment, right?
451
00:26:45.662 --> 00:26:46.043
We went 30.
452
00:26:46.143 --> 00:26:46.263
Yeah.
453
00:26:47.495 --> 00:26:51.338
In doing that, you've still grown by more than 20% in terms of number of customers this year.
454
00:26:51.358 --> 00:26:51.678
Yes, sir.
455
00:26:51.978 --> 00:27:01.305
And so walk me through your thought process of like, was this like, okay, before I bounce from this business, I'm raising prices because I have to.
456
00:27:01.325 --> 00:27:09.010
Because all these adjustments you've talked about, software, equipment, video cameras, managers, mechanics, all that costs money.
457
00:27:09.070 --> 00:27:10.091
Grew the media team too.
458
00:27:10.391 --> 00:27:10.631
Right.
459
00:27:11.032 --> 00:27:12.233
And like all these things cost money.
460
00:27:12.333 --> 00:27:18.938
And so one of the things that I think I always try to like granulite and make really simple like, like make more money.
461
00:27:19.518 --> 00:27:22.621
And if you fix that lever, all these other things that you talked about.
462
00:27:23.696 --> 00:27:24.216
get solved.
463
00:27:24.597 --> 00:27:26.599
You have the resources at least to solve them.
464
00:27:26.859 --> 00:27:31.643
Hire a great general manager, hire a great operations person, a dispatcher, multiple more people on the phones.
465
00:27:31.663 --> 00:27:33.745
Like these all cost hundreds of thousands of dollars.
466
00:27:34.265 --> 00:27:42.112
And so when you raise prices, walk me through your psychology as well as how did you do it and what was the response from customers?
467
00:27:42.372 --> 00:27:43.353
Yeah, yeah, absolutely.
468
00:27:43.473 --> 00:27:48.618
And this is funny because I'm referring to your podcast about raising prices right now that you just recently did.
469
00:27:48.638 --> 00:27:49.899
It was exceptional, by the way.
470
00:27:49.919 --> 00:27:51.361
I think everybody should go and listen to that.
471
00:27:51.381 --> 00:27:52.362
I don't know what the title was.
472
00:27:52.382 --> 00:27:53.683
You just did it like two weeks ago.
473
00:27:53.983 --> 00:27:54.544
It was good, though.
474
00:27:54.564 --> 00:27:55.705
You did a really good job on it.
475
00:27:55.745 --> 00:27:59.068
But I just I resonated with it because it's exactly what we did.
476
00:28:00.269 --> 00:28:03.292
Long story short, there was something I wanted to add to that because it was important.
477
00:28:04.133 --> 00:28:10.977
In short and in simple, obviously, when you're going for a price increase, you're expecting to definitely lose customers.
478
00:28:11.738 --> 00:28:14.680
And I knew that we would lose some of our customers.
479
00:28:14.700 --> 00:28:18.542
And the scary thing for me was I got all this debt, right?
480
00:28:18.942 --> 00:28:24.566
And I need to get a certain amount of customers to cover the debt and all these new infrastructure changes I'm making.
481
00:28:25.106 --> 00:28:26.086
And I had a list.
482
00:28:26.186 --> 00:28:29.167
I had like such a big list of different changes I wanted to make.
483
00:28:29.608 --> 00:28:33.889
And I really just pinpointed the ones that were highest leverage and went for those first.
484
00:28:34.689 --> 00:28:39.071
Fortunately, we were able to get enough business in that I was able to do pretty well all of them and some.
485
00:28:39.191 --> 00:28:44.012
And the challenging part, I would assume, too, is like you almost have to get the changes done before you do sales.
486
00:28:44.392 --> 00:28:44.613
Yes.
487
00:28:44.653 --> 00:28:48.774
A lot of them are coming in when, like, you got to be out there tomorrow because they called in yesterday.
488
00:28:48.814 --> 00:28:48.994
Yeah.
489
00:28:49.174 --> 00:28:51.895
you've got to almost kind of project, okay, how many am I going to lose?
490
00:28:52.155 --> 00:28:54.476
How many am I going to gain by the time I hit snow season?
491
00:28:54.596 --> 00:28:54.776
Yep.
492
00:28:55.036 --> 00:28:58.117
And so when you did the pricing, keep going, sorry.
493
00:28:58.258 --> 00:29:09.442
Yeah, no, it was, I realized all these changes that needed to be made because after we went for 22 days straight, I went like monk mode for a week and I just really looked back on everything that happened and I'm like, holy, I'm screwed.
494
00:29:10.082 --> 00:29:10.642
Like, I'm screwed.
495
00:29:10.663 --> 00:29:11.903
We got so much work to do.
496
00:29:11.964 --> 00:29:16.047
I can't believe that this winter just slapped us around that bad.
497
00:29:16.067 --> 00:29:17.948
And, like, we still got three and a half months to go.
498
00:29:18.028 --> 00:29:21.811
And, like, we have burnt basically all of our money already.
499
00:29:21.891 --> 00:29:23.172
And we still have three and a half months to go.
500
00:29:23.232 --> 00:29:25.854
So I'm like, I know already we're going to be in the red.
501
00:29:26.254 --> 00:29:27.135
Like, I just already know.
502
00:29:27.235 --> 00:29:30.618
We ended up losing $700,000 by the end of that snow year, just so you know.
503
00:29:31.819 --> 00:29:32.739
Sold some real estate.
504
00:29:33.160 --> 00:29:34.721
Ended up, you know, working things out.
505
00:29:34.781 --> 00:29:39.983
We wouldn't have lost $700,000 if we didn't scale so much, but we went from like 30 machines to like 50.
506
00:29:40.443 --> 00:29:41.543
So that came with that too.
507
00:29:41.603 --> 00:29:46.785
But anyways, to get back on track here, sorry, the question again, you were asking.
508
00:29:46.805 --> 00:29:50.486
Just that price increase, that aspect of raising prices, what was the response?
509
00:29:50.506 --> 00:29:52.867
Did you leave 5%, 2% of your customers?
510
00:29:53.187 --> 00:29:53.827
What was that like?
511
00:29:53.847 --> 00:29:59.389
Because I know it's scary when you know, like if I don't get 4,000 customers, I'm in the red from day one.
512
00:29:59.449 --> 00:30:01.029
Yeah, and I was nervous about that.
513
00:30:01.990 --> 00:30:03.050
I just believe that,
514
00:30:04.346 --> 00:30:14.394
I just believe that truthfully with the way we went about it by doing an early renewal process and giving our customers a bit of a heads up because you shouldn't increase your prices without telling your customers.
515
00:30:14.734 --> 00:30:15.775
We send out our email.
516
00:30:15.795 --> 00:30:17.576
We let the customers know the prices would be going up.
517
00:30:17.716 --> 00:30:30.066
But as a kind gesture and a form of goodwill, as you've spoken about before as well, we let them know that, hey, if you want to sign up early, which was in April, just when the snow season ended, if you want to sign up for next winter, our prices are going up.
518
00:30:30.266 --> 00:30:31.187
Customers understood.
519
00:30:31.527 --> 00:30:32.808
They seen how much snow was outside.
520
00:30:33.328 --> 00:30:34.709
They knew the prices were going up.
521
00:30:34.889 --> 00:30:36.710
They already knew that we were too cheap to begin with.
522
00:30:37.070 --> 00:30:39.551
So when the price increase came, nobody even batted an eye.
523
00:30:40.211 --> 00:30:41.452
Not one bad Google review.
524
00:30:42.012 --> 00:30:42.412
Not one.
525
00:30:42.452 --> 00:30:43.573
Like, nobody cared.
526
00:30:43.593 --> 00:30:44.873
Everybody was expecting it.
527
00:30:45.794 --> 00:30:52.517
And we gave them the opportunity to save some money, even though there was a price increase, of, you know, making sure that they sign up early in April.
528
00:30:52.857 --> 00:30:56.198
And this was kind of how we got some more oxygen back in the business, a.k.a.
529
00:30:56.218 --> 00:30:56.578
cash.
530
00:30:56.999 --> 00:30:57.459
We were...
531
00:30:58.079 --> 00:31:01.561
you know, April was there, we are like a couple hundred grand left in the account.
532
00:31:02.081 --> 00:31:05.523
And we knew that if there wasn't a strategy in place, we were going to run out of money.
533
00:31:05.983 --> 00:31:20.531
So after just quickly kind of panting as a team and getting together, I knew that the only lever that we could pull on to be able to get money in the door for our company and save it, just because our real estate deal didn't go through in time, was let's start renewals early.
534
00:31:20.551 --> 00:31:20.851
So I started to
535
00:31:20.851 --> 00:31:22.031
So our renewal was early.
536
00:31:22.051 --> 00:31:26.633
The price increase for renewals was at about a 30% rate.
537
00:31:26.873 --> 00:31:28.874
We gave a 10% pay and full discount.
538
00:31:29.234 --> 00:31:30.875
And those customers were able to save some money.
539
00:31:30.915 --> 00:31:37.978
We ended up signing up 500 customers within that month, brought in hundreds of thousands of dollars of revenue, saved the company pretty much from going bankrupt.
540
00:31:38.378 --> 00:31:43.160
And then we ended up continuing on throughout the summer, running more promotions and campaigns.
541
00:31:43.200 --> 00:31:47.141
Basically, 10% was the deal all year long, but we just packaged it differently.
542
00:31:47.261 --> 00:31:47.441
Yeah.
543
00:31:47.481 --> 00:31:50.423
Put different wrapping paper around the offer and promotion.
544
00:31:50.503 --> 00:31:53.024
And yeah, man, we ended up pretty much saving the company.
545
00:31:53.044 --> 00:31:55.604
So churn, let's talk about customer churn.
546
00:31:55.985 --> 00:31:56.725
Customer churn...
547
00:31:58.352 --> 00:32:00.973
I mean, we went from 4,200 to 5,000 right now.
548
00:32:01.334 --> 00:32:07.697
I can't tell you the exact data of who we lost because we also did a software change, right?
549
00:32:07.757 --> 00:32:10.819
Like we changed from an old software to our own new software.
550
00:32:11.399 --> 00:32:14.300
And when we did that, we lost all of our historical data.
551
00:32:14.421 --> 00:32:17.382
The company didn't give it to us because, you know, we created our own software.
552
00:32:17.402 --> 00:32:18.563
They said, screw you.
553
00:32:18.583 --> 00:32:19.343
We're not giving it to you.
554
00:32:19.363 --> 00:32:20.984
Locked us out of our account, took everything.
555
00:32:21.724 --> 00:32:22.145
And yeah.
556
00:32:22.565 --> 00:32:22.785
Yeah.
557
00:32:23.227 --> 00:32:39.921
Okay, so then kind of to summarize this and go back on it, if someone's listening to this and like, hey, like I've been doing plowing, I'm thinking about this whole snowblower thing, I've seen your videos, I'm inspired by that, it looks like it's better operationally, but there's a big jump from a financing perspective, getting the tractor, getting the blower,
558
00:32:40.922 --> 00:32:46.464
For someone just getting started, more of a solo operator, whether they're just getting started a business or they're thinking about getting into this side of things.
559
00:32:46.964 --> 00:32:49.785
Break down for me the math on a solo operation.
560
00:32:49.885 --> 00:32:51.665
So one tractor, a blower.
561
00:32:52.045 --> 00:32:53.206
Can they do 100 customers?
562
00:32:53.306 --> 00:33:00.248
I guess that probably depends a lot on the frequency of the snow, what type of snow, their density, their route density.
563
00:33:00.268 --> 00:33:04.629
But like just walk me through the model of like a one tractor situation.
564
00:33:04.849 --> 00:33:06.209
What are they going to be spending every month?
565
00:33:06.509 --> 00:33:08.370
What's the value of that equipment, et cetera?
566
00:33:08.962 --> 00:33:16.144
Yeah, so value, you're looking at about $100,000 for the asset, Canadian, if you want a full snow tractor with a blower.
567
00:33:17.025 --> 00:33:20.185
You're going to also, well, for your first year, you could do pen and paper.
568
00:33:20.466 --> 00:33:22.766
You know, you could use even Google Maps as a routing system.
569
00:33:22.786 --> 00:33:24.647
You don't need software with one tractor.
570
00:33:25.667 --> 00:33:27.568
If it's just yourself and you're getting started out there.
571
00:33:28.368 --> 00:33:32.189
As long as your pricing model is correct, you're $100,000 for your asset.
572
00:33:32.309 --> 00:33:34.949
You're probably going to be about $100 an event per fuel.
573
00:33:35.590 --> 00:33:39.850
If there's, you know, 30 events, you might be around that $3,000 mark for fuel.
574
00:33:39.890 --> 00:33:43.671
If you're in a lighter snow market, maybe only 15 events, it would be about $1,500, whatever.
575
00:33:44.731 --> 00:33:48.552
If you choose the right piece of equipment, it's why I choose Kubota, you'll have full warranty.
576
00:33:48.892 --> 00:33:51.993
So anything breaks or anything goes wrong with the equipment, it's 100% covered.
577
00:33:52.533 --> 00:33:54.293
You should also get their insurance as well.
578
00:33:54.333 --> 00:33:56.634
You get their insurance, you break a window, it's covered.
579
00:33:57.074 --> 00:34:01.738
So you don't have to worry about basically anything to do with repairs and maintenance besides filters and consumables.
580
00:34:02.258 --> 00:34:03.099
So that's all covered.
581
00:34:03.119 --> 00:34:04.681
So you don't have to worry about any of those costs.
582
00:34:05.021 --> 00:34:07.403
You just got to worry about making sure you can make your tractor payment.
583
00:34:08.504 --> 00:34:10.185
So that's pretty much all the costs there.
584
00:34:10.205 --> 00:34:11.226
You got some shear pins.
585
00:34:11.786 --> 00:34:12.807
You got filters.
586
00:34:13.328 --> 00:34:14.929
You got, you know, some fuel.
587
00:34:16.230 --> 00:34:17.091
You got grease.
588
00:34:17.671 --> 00:34:19.012
You got some lubricants you might use.
589
00:34:19.032 --> 00:34:21.014
Just simple consumables that won't cost that much.
590
00:34:21.034 --> 00:34:21.855
So you're good there.
591
00:34:21.875 --> 00:34:22.395
That's easy.
592
00:34:22.415 --> 00:34:22.756
Okay.
593
00:34:23.376 --> 00:34:35.099
Now, making sure you actually make money with one tractor is probably the more difficult part because a lot of these guys, and especially a market like ours, you're like, okay, I'm just going to go grab one, two, or three tractors, and it's easy.
594
00:34:35.119 --> 00:34:37.539
I'm just going to rip off Northern Snow, and I'll just charge a cheaper price.
595
00:34:38.019 --> 00:34:38.800
It'll catch up to you.
596
00:34:39.180 --> 00:34:45.121
It will catch up to you because if you're charging a significantly cheaper price, of course, you're not going to be able to out-service us.
597
00:34:45.181 --> 00:34:52.723
You're not going to be able to be on the same service field as we're playing, and ultimately, either you'll just remain as a small company, right?
598
00:34:53.683 --> 00:35:15.133
um or and or you you might end up just having to close down because there's not enough money i watched several companies in our hometown copy and paste what we do and then one year two years later boom done start up close well why they're charging significantly less we were already priced too low we almost went bankrupt over it so imagine them if they're 100 200 cheaper per contract we're charging 700 they're charging 500 400
599
00:35:17.101 --> 00:35:17.862
There's no money in that.
600
00:35:18.142 --> 00:35:19.443
But back to where we were.
601
00:35:20.744 --> 00:35:25.349
If there's somebody out there watching right now and they want to start with one machine, there is a place to start with one machine.
602
00:35:25.389 --> 00:35:25.869
I've done it.
603
00:35:26.730 --> 00:35:31.935
I would focus on making sure that you really look thoroughly at your pricing model.
604
00:35:32.635 --> 00:35:48.342
and pretty much put a contract goal in place try to stay as tight as possible even if you got to go to neighborhoods and knock on every single door in that neighborhood try to stay as tight as possible because that's how you're going to optimize for efficiency i think it's one thing i saw too even your business this year is like you guys are doing the whole street
605
00:35:48.642 --> 00:35:48.802
Yeah.
606
00:35:48.902 --> 00:35:50.463
It's not like one in this neighborhood.
607
00:35:50.483 --> 00:35:54.126
It's like you have five tractors and they're just doing every single driveway.
608
00:35:54.146 --> 00:35:54.727
Yeah.
609
00:35:54.907 --> 00:35:57.989
We were in every nick and cranny of our entire city.
610
00:35:58.550 --> 00:36:00.831
And when I first started, I was spread out a little bit more.
611
00:36:01.312 --> 00:36:03.493
And I'll tell you that the profit is in the road density.
612
00:36:03.954 --> 00:36:09.318
But there's also profit in charging significantly high prices, even if you have to be across the town.
613
00:36:10.038 --> 00:36:10.999
There's money in that as well.
614
00:36:11.059 --> 00:36:15.963
But if you're trying to kind of get in the market, get enough customers without, you know,
615
00:36:16.603 --> 00:36:42.392
dying on the phone trying to do sales i would figure out a good price point where you know you could make your asset payments make some money for yourself um and then make sure that you could cover your consumables put a small bit of money away for damages make sure you have a strong contract in place just in case it's an unforeseen snow year that might you know go over what your contract value is worth you might need to get some additional revenue from your customers to be able to actually still come out profitable and or not break even and
616
00:36:43.312 --> 00:36:45.874
Um, yeah, it's, it's quite simple to be honest.
617
00:36:45.934 --> 00:36:46.194
Yeah.
618
00:36:46.415 --> 00:36:52.699
I would probably look at a figure of being like, okay, well my tractor payments, let's just say for simple numbers are $12,000 a year.
619
00:36:53.220 --> 00:36:55.121
My tractor payments are $12,000 a year.
620
00:36:55.781 --> 00:36:58.944
I want to make that with the insurance or is that an addition usually?
621
00:36:59.264 --> 00:37:03.346
No, they're roughly around $1,500 per unit, but I'm just giving round numbers.
622
00:37:03.406 --> 00:37:04.787
Say they're $12,000 a year.
623
00:37:05.588 --> 00:37:06.628
You need to pay yourself.
624
00:37:07.028 --> 00:37:15.493
If you're looking to just make money in six months and not work summer, maybe you're trying to make a salary of $50,000, add that on top of the $12,000.
625
00:37:15.513 --> 00:37:16.734
You're looking at $62,000.
626
00:37:17.054 --> 00:37:22.997
Add on some consumables, a little bit of money away for damages, some other unforeseen stuff, a little bit of insurance.
627
00:37:23.578 --> 00:37:25.219
You get to $100,000 real quick.
628
00:37:25.319 --> 00:37:25.439
Right.
629
00:37:26.038 --> 00:37:29.640
So if you're charging $1,000 per driveway, you would need to do 100 driveways.
630
00:37:30.160 --> 00:37:32.662
And I'll tell you, you're not doing 100 driveways with one tractor.
631
00:37:33.222 --> 00:37:35.463
You're just not because there's just too much risk.
632
00:37:35.504 --> 00:37:37.485
Like key men risk, you have operational risk.
633
00:37:37.745 --> 00:37:43.068
That one tractor breaks down, you will never have the same efficiency with a plow truck and or a truck and trailer with blowers.
634
00:37:43.328 --> 00:37:46.110
And you'll lose all your customers if one big snow event comes.
635
00:37:46.190 --> 00:37:53.454
Anytime I've ever done any coaching with anybody out there who's looked to get in the same model, I always tell them don't even bother with one machine.
636
00:37:53.934 --> 00:37:54.735
It's two or nothing.
637
00:37:54.935 --> 00:37:55.095
Yeah.
638
00:37:55.475 --> 00:38:05.101
Just because, like, if one breaks down, you need at least one other tractor to be able to get through because there is nothing as efficient as a snow tractor to do residential snow removal.
639
00:38:05.701 --> 00:38:08.823
So if you've got to borrow even a plow truck, you're not going to be able to be as quick.
640
00:38:08.863 --> 00:38:11.625
And if you've got to go there with a truck, trailer, and blowers, you're done.
641
00:38:12.205 --> 00:38:14.807
You're done because it's just not even close to the same amount of efficiency.
642
00:38:15.627 --> 00:38:16.828
I always recommend starting with two.
643
00:38:17.108 --> 00:38:18.509
That's what I tell everybody.
644
00:38:19.750 --> 00:38:20.711
One is very vulnerable.
645
00:38:20.951 --> 00:38:21.512
It's possible.
646
00:38:21.672 --> 00:38:22.152
It's possible.
647
00:38:22.172 --> 00:38:24.034
I have some guys in our hometown who've done it.
648
00:38:24.494 --> 00:38:27.957
You know, there's certain snow events where their tractor breaks down and they don't come up for three days.
649
00:38:28.538 --> 00:38:29.498
You just don't want to be that guy.
650
00:38:29.578 --> 00:38:29.739
Yeah.
651
00:38:30.099 --> 00:38:31.660
You know, like if it works for you, cool.
652
00:38:31.720 --> 00:38:35.984
But if anybody's interested in taking business seriously, I would not go that route.
653
00:38:36.424 --> 00:38:46.371
Well, to wrap things up, I wanted to ask a question, and that is when it comes to snow, one thing that I admire about anyone that does snow is there has to there's a mental fortitude that is required.
654
00:38:46.431 --> 00:38:46.651
Yes.
655
00:38:47.112 --> 00:38:53.236
To get through stretches of days and weeks without no sleep, be at doing high risk activity.
656
00:38:53.676 --> 00:38:58.039
It's extremely seasonal, like up and then it's zero or it's nothing.
657
00:38:58.059 --> 00:39:05.024
It's like we're all 110 percent running full steam 24 hours a day around the clock or there's nothing happening and there's no snow happening.
658
00:39:06.265 --> 00:39:12.588
What have you learned psychologically or just personally to deal with that kind of jump in stress levels?
659
00:39:13.008 --> 00:39:15.530
Because I think that's the thing that burns out so many people from snow.
660
00:39:15.990 --> 00:39:21.153
And even I was talking with owners this morning at Augusta, and I put in the chat like, hey, any questions about snow you guys want to know?
661
00:39:21.713 --> 00:39:26.435
And one of the first things someone comments like, why in the world would you take on the stress of taking on snow?
662
00:39:26.475 --> 00:39:28.036
Like that just seems so difficult.
663
00:39:28.576 --> 00:39:30.397
What have you learned and how has it molded you?
664
00:39:30.417 --> 00:39:33.099
I almost look at snow and these type of services as almost –
665
00:39:33.819 --> 00:39:35.360
The work is doing work on you.
666
00:39:35.640 --> 00:39:36.761
It's emergency services.
667
00:39:36.941 --> 00:39:37.161
Yeah.
668
00:39:37.281 --> 00:39:38.001
That's kind of how I look.
669
00:39:38.041 --> 00:39:40.823
We're like firefighters and, you know, ambulance drivers.
670
00:39:41.003 --> 00:39:41.163
Yeah.
671
00:39:41.283 --> 00:39:41.943
That's how I look at it.
672
00:39:41.963 --> 00:39:48.927
It's like the house is burning down and you are the guy responsible to go put the fire out and you only have a certain time window.
673
00:39:49.107 --> 00:39:53.969
Now we're obviously on less of a time constraint, but we're on a time constraint.
674
00:39:53.989 --> 00:39:54.850
We are period.
675
00:39:55.170 --> 00:39:56.630
Like I said, the analogy is simple.
676
00:39:56.690 --> 00:39:58.151
I almost watch it happen in my own business.
677
00:39:58.171 --> 00:40:01.213
If you don't get to those customers quick enough and they want refunds.
678
00:40:01.893 --> 00:40:02.234
That's it.
679
00:40:02.374 --> 00:40:02.774
It's over.
680
00:40:03.035 --> 00:40:04.056
You're not making your debt payments.
681
00:40:04.076 --> 00:40:04.817
You're going bankrupt.
682
00:40:04.837 --> 00:40:07.822
If it doesn't happen within a month, it's going to happen in a couple months.
683
00:40:08.122 --> 00:40:09.885
Those are the refunds that they pay for the year.
684
00:40:10.065 --> 00:40:10.526
Yeah.
685
00:40:10.586 --> 00:40:11.828
Exactly.
686
00:40:11.968 --> 00:40:14.051
That's what happened to us almost last winter.
687
00:40:14.391 --> 00:40:16.114
We made it work, but it's like...
688
00:40:16.895 --> 00:40:25.837
We went for 22 days straight and near the middle of it, I was watching manpower just slowly dwindle away and we are losing more and more and more and more people.
689
00:40:26.357 --> 00:40:33.299
And how do you have time to do training and hire more operators when you're going for 22 days and you have lack of management?
690
00:40:33.399 --> 00:40:35.320
We didn't have enough manpower internally too.
691
00:40:36.060 --> 00:40:37.241
We ended up saving the company.
692
00:40:37.281 --> 00:40:49.573
I did like a bunch of training classes with me, my partner, Nick, and our operations manager at one in the morning after doing snow for 14, 16 hours, calling guys in that we had through our form, running them in, showing them one or two things on the tractor, giving them a key and tablet.
693
00:40:49.593 --> 00:40:50.434
Okay, be here in an hour.
694
00:40:50.454 --> 00:40:50.915
We're going out.
695
00:40:51.455 --> 00:40:57.020
We did that for like two training classes where we were able to scab like 15 operators.
696
00:40:57.240 --> 00:41:01.364
Last year was when I say this, it was like a dream.
697
00:41:01.664 --> 00:41:03.065
It was truly like a dream.
698
00:41:03.846 --> 00:41:13.374
Staying resilient, going back to having the mental fortitude, just staying absolutely resilient in this business model has helped me get to where I am today.
699
00:41:14.195 --> 00:41:16.076
I've asked myself countless times, I'm like,
700
00:41:16.777 --> 00:41:17.218
Why?
701
00:41:17.738 --> 00:41:19.380
Why out of all businesses?
702
00:41:19.620 --> 00:41:19.920
Why?
703
00:41:20.000 --> 00:41:21.061
How did I end up here?
704
00:41:21.081 --> 00:41:22.763
Because it is very difficult.
705
00:41:23.284 --> 00:41:24.525
It's very taxing on time.
706
00:41:24.545 --> 00:41:27.268
It's unhealthy for you as an individual.
707
00:41:27.668 --> 00:41:28.329
It really is.
708
00:41:28.349 --> 00:41:30.011
The schedule is all over the place.
709
00:41:30.691 --> 00:41:33.514
But there's something that I absolutely love about it.
710
00:41:33.614 --> 00:41:35.696
No other business gives me the same rush.
711
00:41:36.097 --> 00:41:38.639
When I compare lawn care in the summer to doing snow, it's like,
712
00:41:39.400 --> 00:41:42.061
You know, I just like, it's, it's just, it doesn't do it for me.
713
00:41:42.101 --> 00:41:42.661
You know, it doesn't.
714
00:41:42.721 --> 00:41:44.222
And I love the reoccurring service.
715
00:41:44.422 --> 00:41:45.322
I love lawn care.
716
00:41:45.582 --> 00:41:46.883
It's a very simple business.
717
00:41:46.923 --> 00:41:51.144
I feel like I'm, I'm on vacation when it's the summertime because it just runs so smooth.
718
00:41:51.745 --> 00:41:52.605
You fuck up the grass.
719
00:41:52.625 --> 00:41:53.385
We got tomorrow.
720
00:41:53.905 --> 00:41:54.626
You missed a spot.
721
00:41:54.646 --> 00:41:55.566
We got tomorrow.
722
00:41:55.646 --> 00:41:55.986
Yeah.
723
00:41:56.026 --> 00:41:56.286
Yeah.
724
00:41:56.306 --> 00:41:57.627
It's just, it's so simple.
725
00:41:57.647 --> 00:41:59.227
Like, oh, you scalped a little lawn.
726
00:41:59.747 --> 00:42:00.148
Cool.
727
00:42:00.648 --> 00:42:02.348
It's, it's just so much easier.
728
00:42:02.669 --> 00:42:05.029
And I really appreciate the, the, the lawn side.
729
00:42:05.049 --> 00:42:05.850
Um, yeah.
730
00:42:06.710 --> 00:42:11.694
The winter, what I could give to anybody who's interested in taking on the winter.
731
00:42:12.194 --> 00:42:16.037
I mean, man, there is a massive demand in the market.
732
00:42:16.778 --> 00:42:19.400
Robotics is not coming for the business anytime soon.
733
00:42:19.440 --> 00:42:23.503
I mean, snow plowing is here for the next several decades, I truly believe.
734
00:42:23.963 --> 00:42:25.585
Eventually, it'll be automated, but...
735
00:42:26.585 --> 00:42:26.986
It's here.
736
00:42:27.066 --> 00:42:30.169
There's big opportunity, residential especially.
737
00:42:31.030 --> 00:42:34.353
Our baby boomer population market is massive.
738
00:42:34.773 --> 00:42:39.898
And there's a lot of baby boomers that are getting older that can't do their driveway anymore and need their driveway done.
739
00:42:40.098 --> 00:42:41.760
Global warming is not stopping nothing.
740
00:42:41.820 --> 00:42:43.222
I still see it snowing everywhere.
741
00:42:44.903 --> 00:42:49.267
And I just think that if you're going to get into the business and you want to successfully scale it,
742
00:42:50.068 --> 00:42:54.050
Just be prepared, you know, be prepared for a lot of uncertainty.
743
00:42:54.070 --> 00:42:58.291
I mean, this happens in any business period, but you can't predict the weather.
744
00:42:58.311 --> 00:42:59.211
Okay.
745
00:42:59.312 --> 00:43:00.332
You can't predict the weather.
746
00:43:00.412 --> 00:43:01.812
All you could do is prepare for the weather.
747
00:43:02.393 --> 00:43:07.755
And that's what I learned from having a very rough winter last year is I'm going to do everything in my power to prepare for the worst.
748
00:43:08.415 --> 00:43:13.477
And that is, I think your number one asset in this business is mentally preparing and
749
00:43:13.957 --> 00:43:16.380
but actually preparing your operations, your staff, your people.
750
00:43:16.760 --> 00:43:19.043
Prepare them for as if you're going to go for a month straight.
751
00:43:19.063 --> 00:43:23.688
Because a lot of people get in this business, and then the snow season might just eat them up.
752
00:43:23.969 --> 00:43:25.390
I've watched it happen in my hometown.
753
00:43:25.431 --> 00:43:26.572
Just boom.
754
00:43:26.652 --> 00:43:27.593
Company comes out of nowhere.
755
00:43:27.613 --> 00:43:28.334
They want to start up.
756
00:43:28.354 --> 00:43:30.276
They're doing a decent job, one or two snow events.
757
00:43:30.516 --> 00:43:33.119
Then we get the first storm that lasts a week long, and they're done.
758
00:43:34.147 --> 00:43:39.910
So it's mental preparation and operational preparation, internal preparation for your team.
759
00:43:39.930 --> 00:43:43.892
Like you got to get your whole team on this mental mindset that we are going to war.
760
00:43:44.392 --> 00:43:45.052
We are going to war.
761
00:43:45.492 --> 00:43:46.253
Are you guys on board?
762
00:43:46.393 --> 00:43:47.053
Are you guys ready?
763
00:43:47.373 --> 00:43:50.535
Because it's not just like we're going to clock in eight to four here.
764
00:43:50.915 --> 00:43:51.235
No, no, no.
765
00:43:51.255 --> 00:43:52.476
We're going until the snow's done.
766
00:43:53.533 --> 00:43:57.416
And everybody's working different shift work and problems are happening all over the place.
767
00:43:57.576 --> 00:43:58.497
Snow's coming down.
768
00:43:58.597 --> 00:44:02.661
It's like it is like the definition of ultimate chaos.
769
00:44:03.041 --> 00:44:05.423
And I think that's why I kind of find my stride in it.
770
00:44:05.463 --> 00:44:06.464
And I absolutely love it.
771
00:44:07.545 --> 00:44:16.212
What's really worked for me personally and making me have a better mental fortitude, like you asked, was making sure that we built an exceptional culture and.
772
00:44:17.012 --> 00:44:22.134
because it's made not only me more mentally stronger by making sure my guys are happy.
773
00:44:22.534 --> 00:44:27.516
But if I'm happy, I'm showing up with a smile on my face and all the leaders are by building this toxic culture.
774
00:44:27.876 --> 00:44:32.577
You could also see in the individuals that they're bright, happy and excited to be there.
775
00:44:32.898 --> 00:44:37.919
And when you see that, it makes the stress of the business a lot easier because it's all about manpower.
776
00:44:38.099 --> 00:44:43.361
You could have 100 tractors in a market like mine only doing 5000 homes, which would be overkill.
777
00:44:43.381 --> 00:44:45.482
You'd be able to go service your customers in a couple hours.
778
00:44:46.463 --> 00:44:49.644
If you don't have the right people and you don't have enough people, you're done.
779
00:44:49.664 --> 00:44:51.665
It doesn't matter how much assets you have.
780
00:44:51.685 --> 00:44:52.025
You're done.
781
00:44:52.625 --> 00:45:05.809
So, yeah, that's been a really big one is making sure that you're mentally prepared, you're operationally prepared, and spreading that across your entire team, having that strong culture that, hey, we're in this together, guys, and we're going to go to war together.
782
00:45:06.329 --> 00:45:08.690
And we do a lot of hoorahs before we go out.
783
00:45:08.990 --> 00:45:11.251
We recognize operators who do a really good job.
784
00:45:12.191 --> 00:45:13.913
We do a lot of incentives, right?
785
00:45:14.353 --> 00:45:15.354
Lots of incentives.
786
00:45:15.835 --> 00:45:23.982
And we just really make sure that we feel like a major team, like a real professional hockey team out there, a professional NFL team, you know?
787
00:45:24.302 --> 00:45:29.667
We make sure that we're all in it together and everybody's getting recognized, rewarded, and we're moving together as one wrecking force.
788
00:45:30.128 --> 00:45:30.368
Awesome.
789
00:45:30.448 --> 00:45:31.449
The Tractor Boys.
790
00:45:31.749 --> 00:45:32.290
Tractor Boys.
791
00:45:32.350 --> 00:45:34.592
Ladies and gentlemen, Stefano Nardici.
792
00:45:34.612 --> 00:45:35.132
Thanks, bro.
793
00:45:35.293 --> 00:45:35.773
Thanks, bro.
794
00:45:35.793 --> 00:45:36.454
Appreciate it.
795
00:45:36.474 --> 00:45:37.154
Thanks, man.
796
00:45:37.314 --> 00:45:37.855
Thank you, dude.