6 Secrets to Build a $1M Business w/ 20% Profit

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You are one or two people walking off the job from literally being 911 status.
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If you lose 20% of your clients, the first thing you have to do next year is grow the business by what feels like 20% just to get the break even.
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Revenue risk means they leave because you can't do this thing.
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not allowing bi-weekly mowing created revenue risk.
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We gave up at least a million dollars in revenue just doing that, at least.
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If someone was looking for a ratio, there's no golden bullet, but like, let's say you have five to eight technicians, you're already vulnerable with one or two lead, like just a huge amount of the later force gone.
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Taking your P&L as whether or not your business is profitable instead of individual departments, individual crews, individual employees, like being able to break it down, looking at it as this
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bucket of all the revenue and all the expenses in my business versus their individual departments, their individual services, their individual crews and employees.
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And each of those can be profitable or unprofitable at varying degrees.
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This is one of the top level problems for people.
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It's like,
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Which is your biggest constraint at the moment?
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Meaning what's the thing you whine and cry about the most?
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Okay, there's your hint.
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That's what should get all your time, like as much as you can.
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Welcome back, everyone.
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Today, we're doing something a little bit different.
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We're gonna be talking about six different tips to grow a million dollar business.
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And the reason this actually came up was because recently I did a poll on the channel and asked what size of business you were trying to build.
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And 70% of respondents said that a million dollar business that was mostly recurring and 20% profit margins that you could leave occasionally on a vacation and not things fall apart, that was actually your ideal size business.
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So I know a lot of times we talk about AI or private equity for the bigger companies that are trying to grow beyond that.
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And don't worry, next week we'll be back with another large company episode.
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But today we want to focus on some of the things that we would recommend for that operator That's trying to grow that size of business.
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It's a million dollars in revenue 20% profit margins with a system sufficient to where you can go on a vacation and things not fall apart So we're gonna do is Jonathan Patoshnik and myself.
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We're gonna go back and forth with three different tips each and
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of what we would recommend.
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And we have not discussed these or shared these with each other prior.
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And so we'll kind of riff on some of these different ideas.
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So hopefully you can take exactly what's being said and implement it, executing your business and grow the size of business.
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So Jonathan, why don't you go ahead and kick it off with your first tip to get to a million dollars, or even at that size, how to make it profitable at 20%.
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Okay.
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I think the profit comes with the growth in the way I'm going to approach this.
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Now, I have no idea what you're going to say.
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So I went specific with some very specific things that I think can... Because we talk about marketing.
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Not that we won't talk about it here.
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We talk about having a few services.
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We talk about density.
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Those would be great things to talk about.
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But I went a little bit different direction.
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What are a few things that can make a big difference?
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So I have no idea what you're going to talk about.
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one that I see.
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And that is on 5 for 50, I talk about this idea of these two machines.
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You have a revenue machine that's gonna be responsible for, or a growth machine.
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That's like the marketing side of getting enough work.
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And then you have the people machine, the recruiting machine to bring enough people to do the work.
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And if they get out of balance,
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then your business doesn't grow.
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Or if they get out of balance, you live in fear of getting more clients or you live in fear because you don't...
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If I get more clients, I don't have many people do it.
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Or you live in fear of, if I get more team members, I got to pay them.
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I don't have enough work for them.
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Okay.
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Well, a level down from that, another way that the whole system can get out of balance is this idea that...
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you're not constantly putting enough people into the pipeline before you need them.
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So a simple tactic that I'm a huge fan of, simple might be overselling this, but a tactic I'm a huge fan of is this idea that you always have another foreman in the pipeline.
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From my experience, and I don't know how you feel about this, but...
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That seems to be... We have one problem of finding enough people to do the work.
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And then we have another problem.
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It's like finding the right people.
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So it's a different scenario.
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We'll just use a lawn mowing or a window cleaning example.
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You generally have to have a person that drives a truck, that runs the crew, is ultimately responsible.
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I'm calling that the foreman.
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And if...
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You can find laborers or helpers or workers, but you can't find the driver.
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It doesn't matter.
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And so my belief is that as you're building the business, you're always overspending a little bit.
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And my example would be if you have a foreman,
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You could have a worker, just like a helper, let's put it that way.
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And they cost a little less.
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But the ideal is to overspend, pay a little bit more money and have that second or third person be the next foreman in training.
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Because that means you're always ready to put somebody on the next truck.
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And so you might get everything right where you're good at finding people to work in the business, but you're struggling to find the foreman and that's what breaks the growth.
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So when Mike talks about how are we going to get you to a million bucks?
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How are we going to get there without this?
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I don't think you said it this way, but the way I think about it, how are we going to get you there without this feeling like misery and incredible pain?
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This is one of the things that I think if you do this from the beginning, it just simplifies it.
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It doesn't make it easy, but it makes it easier.
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I see company after company get stuck in this way.
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And if someone has a crew right now and they're like, hey, they're doing pretty good, I don't necessarily want to hire another person, could an alternative way of looking at this be almost having a, I'll use your words, foreman that you've hired or you have interviewed and said, hey, you're next on, like if I need someone, I'll be giving you a call and...
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knowing that they have another job and you'll have to get, they'll have to get there two weeks, but that you do have that bench to fall back on.
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Yeah, no, I love that strategy.
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It's, I feel a little safer if I have a couple people on that bench that are foreman, cause you just never know what's going to happen.
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And so that is one way to play it.
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And in a perfect world, you're kind of doing both.
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And for someone that is thinking about doing this, what would be the strategy of trying to talk to somebody to create that bench and or explain to a foreman that, hey, you're going to be working with another foreman.
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You're not going to have your own crew.
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Like, what are those conversations looking like?
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You know, generally, I don't have a...
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magic answer for that.
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It's more of just being very straightforward and honest and saying, Hey, here's what's going on inside our business.
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We're growing.
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Things are going really well.
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I don't have a truck for you yet, but I think we're getting really close.
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I want to go ahead and get you into the company now.
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if you were doing a pay for performance scenario, I think about, hey, I want to go ahead and get you in the company now.
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I want to get you fully trained up.
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I want to get you up to speed.
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That way, when you jump on the truck, you're going to be producing at the highest level.
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You know, you just kind of talk through it.
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I generally think most answers are honest answers and just saying, like just laying it out there.
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And so that's how I would sell to somebody is I really want you on my team.
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I really want to work with you.
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I don't have a truck for you.
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I know you deserve a truck.
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I know you, you're...
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you cannot, you're not, I'm not going to get you stuck here helping somebody on a truck.
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You deserve a truck.
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I just need a little bit of time.
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I want to get you up to speed and then I'm going to get you in that truck.
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It would be that.
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I mean, I just, I, that's how I talk to him about it.
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I think it's almost like an insurance policy because so oftentimes at that smaller size business, we're talking to under a million, you are one or two people walking off the job from literally being 911 status.
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And it's one of the biggest reasons I know you propose growing a bigger business is to reduce this liability or this risk being so dependent on one or two foremen walking off the job, and you are toast.
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And so this is in a way you spend a little extra.
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Maybe you lose an extra 2% or 3% on margin, but I'm having that more expensive person trained up, ready to go to reduce the liability or the risk of one person leaving.
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100%.
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That's such a great point.
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I didn't even really think about it coming into this.
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But that's exactly what you're trying to do.
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And it's something else.
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It's that.
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But it's also...
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Think about what happens with so many owners.
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They finally get off the truck or they get off the truck 70% of the time.
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And the next thing... And now they're actually starting to think about marketing stuff.
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They're actually starting to...
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answer the phone faster.
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They're actually starting to turn estimates faster.
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They're actually now doing all these things that are gonna make the business grow faster and then Bob doesn't show up.
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They're back on the truck.
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And now they're back on the truck for a week or two weeks
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And that's such a common problem that just gets people stuck back in the field.
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And then it starts to get towards August or September of the year.
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And they're like, you know, at this point, I'm not even going to hire another guy because I'm going to have to carry him through the winter.
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And then there you go.
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It's like now you're going to solve that problem next spring and something's going to happen.
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And you lose a year.
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It happens to so many companies like these little things like this, somehow you lose a year.
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And that's why these businesses are so painful and miserable.
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It's they don't move through some of these painful stages fast enough.
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This is a way that you move a little more quickly.
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So that's 100% agree with that.
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If someone was looking for a ratio, there's no golden bullet, but like, let's say you have five to eight technicians, you're already vulnerable if one or two leave, like just a huge amount of the labor force gone.
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But would you say like out of three, maybe having that one extra backup?
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So you even have a couple of these people in the company that are a little bit, a little bit overpaid for what they're doing, but they are kind of your backstop for something bad happening in the company.
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Yeah, I don't have a ratio, but it sounds good to me.
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Yeah.
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I would tell you the minimum is one.
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That's the floor.
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But just again, think about what it costs you.
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We just covered it.
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It costs you not...
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If you just don't sell a couple days worth of work that you could have sold, or you don't perform...
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a couple days worth of work.
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I mean, there's so many ways to pay for this.
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There's so many ways.
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I always used to call it invisible numbers.
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We have all these invisible numbers in our business we don't see where we're just leaking the money.
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And we don't realize we're losing that money.
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But that's the exact money that would pay for a little extra hourly rate to have this kind of person on the team.
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This month, this kind of stuff almost never actually costs money.
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We don't see it.
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It's the invisible number concept.
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But what happens by having this person, yes, they cost a little bit more.
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I wouldn't even be convinced it costs you in terms of profitability that much because you're going to sell more work.
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You're going to have better retention.
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You're going to have better customer service.
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Everything's just going to work better.
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And you're going to be happier.
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Life's going to be better.
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You don't get stuck back in the field.
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You're not going home at nine o'clock at night as frequently having a conversation with a frustrated spouse.
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Like it just fixes so many things that I don't think it actually costs.
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I think it's the same vein.
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We kind of talked about the foreman, but I almost wonder like at a million dollars, one of the roles that I find really helpful is not necessarily labeling them as an operations manager or even operations assistant, but just a team member or foreman that you can lean on
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and that you've trained up and maybe spent a little extra time so that if you were on vacation, they know a few other operational things in the business that they can kind of help manage or guard for you to spend time away from the business, whether that be wrapping up at the end of the day, getting the cruise started, doing a little bit of routing or dispatch, adjusting the cruise routes, the same thing.
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It's like, yes, it takes a little extra time.
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You might pay that personal extra more, a little extra, but that is your buffer to be able to go take the vacation, spend some time away from the business, and have that level of protection.
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100% agree.
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Totally agree.
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All right, I'll move on my first one.
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All right, so my first one is fixing your off-season, doing whatever is required to not have negative cash flow months.
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And so when I look at the off-season, I've always seen it as the number one thing that's bad with home services, as a just generalization of the industry.
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And one way to ask yourself, like, do I have a off-season is, well, do leads drop off or does my profit go negative?
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Yeah.
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And if those things are happening, it's so hard to run the business in a way that prevents cash hoarding.
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So I remember this being myself.
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It's like I save up all my profit.
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I need $70,000 to $100,000 to get through the winter because I knew I'd be burning on unproductive labor, admin people I didn't really need.
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Uh, and so doing whatever is possible, whether that be upselling customers, whether it be analyzing contracts, but ultimately I actually don't think it's the cash.
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That's the problem.
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It's the fact that having a cash crunch causes people to make bad decisions.
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And so they go into spring rush now being depleted of all of their cash.
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and having to make hiring decisions with not a lot of cash.
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They don't do what you just said.
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It's like, well, I don't have the money.
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And they make bad marketing decisions because they don't have enough cash.
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And they do all these decisions that kill them, but it's happened because of a lack of cash.
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And it's happening, the lack of cash is happening because they have an off season.
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And so I would do whatever it took.
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I don't care, like just the one...
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place in the world where I say you can add a service.
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It's like, if you can do that work during your off season, that might be a good reason to add that additional service.
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But whether you got to lay off your admin person, have conversations around, Hey, we don't need you full time during these four months of the year, having a comeback to work bonus, figuring out some sort of seasonal labor.
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Like I was talking to Dr. Cashew one time about this and he was like, yeah, it's really, it sounds pretty straightforward.
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You have a seasonal business.
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You should have seasonal labor.
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I was like, well, yeah, that makes sense.
211
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And so if we have seasonality around when our leads happen, we should expect the fact that we do have to adjust our labor to ensure that we're not massively overpaying throughout the offseason.
212
00:13:50.862 --> 00:13:54.004
Yeah, I've seen this over and over in P&Ls.
213
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Everything looks great.
214
00:13:56.426 --> 00:13:57.227
And then you give back.
215
00:13:58.107 --> 00:14:00.329
30% of the profit in the wintertime.
216
00:14:00.969 --> 00:14:03.371
Or the other one, this is where a lot of the debt gets accumulated.
217
00:14:04.192 --> 00:14:05.973
You know, so it's like, how do companies get in trouble?
218
00:14:06.013 --> 00:14:06.954
It's not because they were dumb.
219
00:14:07.595 --> 00:14:09.897
It's not because they were being careless.
220
00:14:09.977 --> 00:14:12.519
It's because of exactly what you just said.
221
00:14:12.559 --> 00:14:16.962
So over the time that debt builds up slowly year after year, and you dig a hole.
222
00:14:17.603 --> 00:14:22.307
What are some of the best ways you found to solve for the winter crunch?
223
00:14:22.587 --> 00:14:25.089
And I know it varies by industry and competition.
224
00:14:25.815 --> 00:14:26.835
where you're at in the market.
225
00:14:26.855 --> 00:14:30.656
And I know about snow in the north, but what do you tend to see some of the best solutions to this be?
226
00:14:31.036 --> 00:14:36.358
Usually the first thing I'm looking at is trying to fix and reduce fixed expenses.
227
00:14:36.858 --> 00:14:43.580
And so to your point about debt, it's like a self-fulfilling prophecy because now next year, when they go in the off season, they have more fixed expenses.
228
00:14:44.600 --> 00:14:46.441
And so I'm trying to negotiate too.
229
00:14:46.482 --> 00:14:54.286
Like sometimes lenders will, if you have equipment debt, for example, they might allow for like nine or 10 months of financing and you get two or three months off.
230
00:14:55.087 --> 00:14:58.589
So I'd be doing some negotiation if possible, but anything that's fixed.
231
00:14:58.769 --> 00:14:59.910
So like rent,
232
00:15:00.870 --> 00:15:06.891
Anything that is subscription-based, I'm trying to ask myself, can I reduce that or make it variable?
233
00:15:06.931 --> 00:15:13.413
So for example, can I go get an agency that can run my ads for nine months of the year and they don't require 12 months?
234
00:15:13.853 --> 00:15:17.374
Now all of a sudden I unlocked $1,000 a month of management fees.
235
00:15:17.734 --> 00:15:28.356
I'm looking at my admin, like do I need to hire two full-time admin year round or can I hire one and then just hire someone to back me up and pay by the minute for three to four months of the
236
00:15:30.997 --> 00:15:32.758
I'm always trying to look for like the fixed expenses.
237
00:15:32.798 --> 00:15:35.079
First of all, that's more of a defensive measure.
238
00:15:35.139 --> 00:15:37.659
And then the offensive measure is, can I add another service?
239
00:15:37.859 --> 00:15:39.320
Can I upsell existing customers?
240
00:15:39.640 --> 00:15:44.202
Can I move even services that have a little bit of buffer of when I can get them done?
241
00:15:44.342 --> 00:15:46.162
Can I move them more towards my off season?
242
00:15:46.782 --> 00:15:55.545
And so whether it be like, for example, mowing, it's like, well, can I do more fertilization weed control in the months where I'm not so busy with mowing, including my off season?
243
00:15:55.886 --> 00:15:59.847
So there's a couple of the defensive measure and an offensive measure to try to fill that hole.
244
00:16:00.247 --> 00:16:02.128
And we've never laid, we don't lay people off.
245
00:16:02.248 --> 00:16:03.950
We've never done it in our business.
246
00:16:03.990 --> 00:16:06.391
And we've tried to patch these holes.
247
00:16:06.611 --> 00:16:07.632
It's been really tough.
248
00:16:07.652 --> 00:16:10.414
I would not describe it as having solved the problem completely.
249
00:16:10.454 --> 00:16:13.656
But H2B visa was critical to us.
250
00:16:14.256 --> 00:16:16.478
That's one of the biggest ways we made this work.
251
00:16:18.222 --> 00:16:19.603
And one of the reasons I was...
252
00:16:20.064 --> 00:16:29.792
There's a lot of reasons I'm apprehensive because the longevity of team members is just so valuable to the culture of the business, the quality of the work, the retention of the client.
253
00:16:30.432 --> 00:16:34.516
And so that's a cost that gets incurred when you lay people off and you bring people back.
254
00:16:34.596 --> 00:16:37.738
Even under H2V visa, we're bringing back the exact same people every year.
255
00:16:38.517 --> 00:16:49.422
And so that training and that learning that happens, like how I work within, in our case, the CityTurf business and culture, that builds over time.
256
00:16:49.462 --> 00:16:52.663
Anyway, my point here is I've always been a little afraid of this idea.
257
00:16:52.683 --> 00:16:59.066
I've met so many companies, especially in the North, that lay off their team members and they just go on unemployment and they hire them back.
258
00:16:59.426 --> 00:17:00.627
So a couple questions there.
259
00:17:02.001 --> 00:17:05.343
From an unemployment standpoint, how does that work for most people?
260
00:17:05.383 --> 00:17:11.167
How big of a hit or penalty is that to most companies when you're laying them off, you're getting hit with unemployment?
261
00:17:11.508 --> 00:17:14.710
They may then raise your unemployment tax and maybe who cares?
262
00:17:14.970 --> 00:17:16.111
It's worth paying that fee.
263
00:17:16.131 --> 00:17:17.652
But how do you think about that?
264
00:17:17.972 --> 00:17:18.973
How do other companies think about it?
265
00:17:18.993 --> 00:17:20.294
It's not something I've personally dealt with.
266
00:17:21.315 --> 00:17:29.860
I think first off, if someone's worried about unemployment, almost always I can make a case for that being cheaper than still having them on and being at like 10 or 15 percent efficiency.
267
00:17:31.341 --> 00:17:38.004
The next part is I have rarely seen great team members do that where they're just like, I will not work for three months and just take unemployment.
268
00:17:38.424 --> 00:17:39.685
I have almost never seen that.
269
00:17:39.705 --> 00:17:41.546
Like great team members, they're like, I need a job.
270
00:17:41.706 --> 00:17:42.467
I need something to do.
271
00:17:43.187 --> 00:17:47.689
And so I was really afraid when I first did it, I did it out of necessity because my location was losing money.
272
00:17:48.369 --> 00:17:53.351
And I just knew that that, that, that winter was either, it was right after I got the accident, I knew what I needed to do.
273
00:17:53.431 --> 00:18:00.213
I'm like, I got to tear the bandaid off and say, Hey guys, if you want the work, I will keep you on, but you're going to get 10 to 20 hours a week.
274
00:18:00.713 --> 00:18:02.394
Otherwise I'll see you March 1st.
275
00:18:02.414 --> 00:18:05.775
You have a guaranteed job and I'll, I'll pay all your benefits throughout the off season.
276
00:18:06.695 --> 00:18:10.958
And I was shocked by the fact that not one single person left the company.
277
00:18:11.218 --> 00:18:13.940
Some of them just stayed on and got lower hours.
278
00:18:14.000 --> 00:18:15.602
And then others came back March 1st.
279
00:18:16.442 --> 00:18:17.463
And I was shocked.
280
00:18:18.143 --> 00:18:22.566
And from that time, I've just been amazed by the fact that great talent.
281
00:18:22.586 --> 00:18:23.407
We'll go find another job.
282
00:18:23.607 --> 00:18:24.888
You give them a guaranteed start date.
283
00:18:25.228 --> 00:18:28.230
Usually the off-season and home services kind of corresponds well with the retail.
284
00:18:28.571 --> 00:18:31.573
Like people need November, December, January in retail.
285
00:18:31.833 --> 00:18:32.794
They need a job really easy.
286
00:18:32.874 --> 00:18:33.654
Take a few weeks off.
287
00:18:33.734 --> 00:18:34.115
Come back.
288
00:18:34.775 --> 00:18:36.236
end of February and we're good to go.
289
00:18:37.297 --> 00:18:40.920
The other part that is really important was expectations when hiring.
290
00:18:41.541 --> 00:18:55.573
If you go into it knowing what your demand curve looks like and when you need to lay people off, you just tell them in the hiring process, you have full-time hours during these months, during these months you can leave or you're gonna have between 10 and 20 or 30 hours a week, for example.
291
00:18:56.033 --> 00:19:08.583
And so the hardest part is actually admin because we've seen more friction around admin wanting more regular hours compared to the technicians where a lot of times they don't really want to work out in the winter and during our off season.
292
00:19:09.103 --> 00:19:16.008
And so we really lean into this upcoming season is like expectations of like every single quarter.
293
00:19:16.028 --> 00:19:17.590
This is how many hours we expect you to work.
294
00:19:18.130 --> 00:19:20.331
And now there's no awkward conversations.
295
00:19:20.751 --> 00:19:21.852
Hey, so-and-so got it.
296
00:19:21.872 --> 00:19:22.872
So-and-so did not.
297
00:19:23.153 --> 00:19:27.395
And as they have more tenor, they're able to get more hours during the off-season if they would like.
298
00:19:27.955 --> 00:19:30.736
So we've created a little bit more around the admin side.
299
00:19:31.417 --> 00:19:34.898
But for technicians, we've never had it be a huge problem.
300
00:19:35.199 --> 00:19:40.641
And for those that have, they've added in a come-to-work bonus like back in the spring where they can come back.
301
00:19:40.681 --> 00:19:46.224
So if you might spend $2,000 or $3,000 on that, it's still a lot cheaper than paying someone $15,000 to keep them on all off-season.
302
00:19:48.665 --> 00:19:49.806
I've heard a company that's doing that.
303
00:19:50.506 --> 00:20:03.393
Do you let... During the... We'll call it in this example, nine months of the year that they're full-time, do you let people work overtime or do you backfill and hire additional people to keep your team out of overtime?
304
00:20:04.490 --> 00:20:09.653
With P4P, because they're getting hourly plus, it doesn't make a huge difference.
305
00:20:09.753 --> 00:20:12.935
But we try not to let them go too far in overtime because they know.
306
00:20:12.955 --> 00:20:17.138
They know like this is not – they're not really getting time and a half if they're a high performer.
307
00:20:17.738 --> 00:20:20.420
And so it's something that we try to be as honest with them as possible.
308
00:20:20.880 --> 00:20:22.221
And they don't want to go too far.
309
00:20:22.261 --> 00:20:24.222
But they also don't want us to hire too much.
310
00:20:24.642 --> 00:20:30.366
And they are willing to go into it because they know that if we hire, then they're going to have less hours when it gets a little slower.
311
00:20:30.386 --> 00:20:30.626
Yeah.
312
00:20:30.966 --> 00:20:34.871
So it's just a matter of like communication of like explain like, look, guys, we are working longer hours.
313
00:20:35.331 --> 00:20:40.718
But if we don't and we hire more people, then we're all going to have a little less hours come slower season.
314
00:20:41.419 --> 00:20:42.500
That makes sense.
315
00:20:42.800 --> 00:20:45.223
Just the aligned incentives help with P4P.
316
00:20:45.243 --> 00:20:45.423
Yeah.
317
00:20:45.584 --> 00:20:46.625
All right.
318
00:20:46.645 --> 00:20:47.306
What's your second one?
319
00:20:48.467 --> 00:20:51.848
Second one somewhat aligns with this because it's related to money.
320
00:20:52.268 --> 00:20:53.308
It's the speed of getting paid.
321
00:20:53.328 --> 00:20:56.749
It's like, you know, I know you talk about it as well.
322
00:20:56.929 --> 00:21:00.010
It was the breakthrough going way back.
323
00:21:00.210 --> 00:21:03.811
It's really been the breakthrough in every business I've ever had.
324
00:21:04.551 --> 00:21:05.972
How do you finance these things?
325
00:21:06.752 --> 00:21:15.162
So way back in the cleaning industry days where they would pay on 30 and 60 day terms, we would renegotiate to get paid weekly.
326
00:21:15.282 --> 00:21:22.249
So instead of taking a price increase, annual price increase, like, okay, this year we'll skip the price increase or whatever the example might be.
327
00:21:22.690 --> 00:21:25.854
So you're saving 3% on your money, but we want to get a weekly check.
328
00:21:26.664 --> 00:21:28.044
And so you'd speed up.
329
00:21:28.224 --> 00:21:31.205
And that was all obviously commercial work.
330
00:21:31.805 --> 00:21:34.146
You'd find creative ways to get paid faster.
331
00:21:34.946 --> 00:21:36.447
And that's how you finance the business.
332
00:21:36.467 --> 00:21:39.048
That's how you stay out of a line of credits, all these types of things.
333
00:21:39.068 --> 00:21:43.749
Well, in the CityTurf business, it was exactly the same thing.
334
00:21:44.289 --> 00:21:47.530
But for me, the solution was how do you charge a credit card every week?
335
00:21:48.685 --> 00:21:51.267
And how do you charge a credit card as soon as you do the work?
336
00:21:51.307 --> 00:21:59.472
This is not a new idea at this point, but it's a critical concept to understand that there's a cost of money.
337
00:22:00.752 --> 00:22:08.077
Basically, if you are getting paid on 30-day terms, meaning you do the work and they pay you 30 days later, you're lending your clients money.
338
00:22:08.697 --> 00:22:09.878
And you're a bank.
339
00:22:10.038 --> 00:22:12.920
You will get some of the money from them and some of the money will go bad.
340
00:22:13.280 --> 00:22:15.882
You'll never get it, but you're a bank and that costs you money.
341
00:22:16.895 --> 00:22:22.860
not only does it cost you money because you're essentially a bank and you're loaning money, it costs you money because you don't have that money in your bank account.
342
00:22:22.880 --> 00:22:30.686
So when you log into whatever your bank account is, instead of your balance showing $24,000, it typically shows $6,000.
343
00:22:30.866 --> 00:22:34.269
And just think about what that does to you from a psychological standpoint.
344
00:22:34.649 --> 00:22:38.252
You look at that bank account balance, you're like, I don't have any money to hire another foreman.
345
00:22:38.932 --> 00:22:41.715
I don't have any money to spend on marketing in spring.
346
00:22:42.615 --> 00:22:45.738
And so just the simple act of having a bigger account
347
00:22:46.664 --> 00:22:51.386
Average daily balance in your bank account because you're getting paid faster changes psychology.
348
00:22:51.406 --> 00:22:58.909
It's like, oh, I could float $5,000 a month to pay for somebody else to be on the team and answer the phone so we can turn estimates faster.
349
00:22:59.369 --> 00:23:02.491
And whatever the scenario is, the problem is that you need to solve.
350
00:23:02.531 --> 00:23:02.791
Yeah.
351
00:23:04.031 --> 00:23:09.594
The speed of getting paid is truly one of the single most important things.
352
00:23:10.154 --> 00:23:13.896
And it applies to every single business that exists anywhere in the world.
353
00:23:13.916 --> 00:23:14.997
There is no exception.
354
00:23:15.577 --> 00:23:23.461
And sophisticated owners know that if they're getting paid slow, that has to be reflected in the price.
355
00:23:23.481 --> 00:23:24.301
Right.
356
00:23:24.479 --> 00:23:41.378
So in other words, if I'm a smart business owner and my customer is the government and the government's gonna pay me on 60 or 90 day terms, then what I do is like, okay, well, it's gonna cost me 7% of my money to use a line of credit to get my money faster.
357
00:23:41.418 --> 00:23:42.540
So if the government owes me 200,000,
358
00:23:44.021 --> 00:23:50.684
In 90 days, I can get $200,000 today from the bank on a line of credit and just pay that back.
359
00:23:51.164 --> 00:23:54.726
It's not how most of us think, but that's how these big companies would think about.
360
00:23:54.746 --> 00:23:56.427
It's like, okay, they won't pay me for 90 days.
361
00:23:56.527 --> 00:23:58.167
I can solve the problem with a line of credit at the bank.
362
00:23:58.547 --> 00:24:00.388
But that is going to cost me X amount of money.
363
00:24:00.468 --> 00:24:02.329
So I just build it into my price to the government.
364
00:24:02.629 --> 00:24:03.390
That's how it works.
365
00:24:04.010 --> 00:24:05.350
That's how you maintain margins.
366
00:24:05.971 --> 00:24:10.693
And so I just give that illustration to say there is no free lunch, but most of us...
367
00:24:11.313 --> 00:24:13.235
that are younger in business.
368
00:24:13.295 --> 00:24:16.117
We're not as sophisticated as we're learning as we go.
369
00:24:16.498 --> 00:24:18.099
We never worked in a big corporation.
370
00:24:18.139 --> 00:24:21.522
In the finance department saw how it really works and how people really think about this.
371
00:24:22.143 --> 00:24:25.306
We just let that money... We don't make up for that money.
372
00:24:25.346 --> 00:24:28.288
We don't charge it back to the client that's floating money with us.
373
00:24:28.909 --> 00:24:30.090
And it kills our margins.
374
00:24:30.490 --> 00:24:31.892
So there's so many scenarios.
375
00:24:32.272 --> 00:24:33.873
You're killing your margins by doing this.
376
00:24:34.374 --> 00:24:36.115
You're not hiring as fast as you could.
377
00:24:36.896 --> 00:24:39.359
You're not reinvesting in your equipment as fast as you could.
378
00:24:39.619 --> 00:24:46.327
You're not doing the marketing you could all because you have so much money on loan out to everybody, all of your clients.
379
00:24:46.367 --> 00:24:54.736
And so if there's one thing that you want to get right from the beginning so you can minimize the pain of growing a company, which means you go faster.
380
00:24:55.577 --> 00:24:57.098
You grow through the problems faster.
381
00:24:57.338 --> 00:24:59.299
That's a theme that I like to talk about.
382
00:25:00.159 --> 00:25:01.140
This is how you do it.
383
00:25:01.620 --> 00:25:05.241
This is how you do it without getting loans and without getting an investor.
384
00:25:05.662 --> 00:25:06.942
You just get paid immediately.
385
00:25:07.062 --> 00:25:11.084
And I know many companies who get paid in advance.
386
00:25:11.404 --> 00:25:16.687
They might bill once a month, but they bill at the first of the month for all the work coming up for the month.
387
00:25:16.827 --> 00:25:20.328
That's even better than getting paid the day after you do the work.
388
00:25:20.388 --> 00:25:21.729
So be creative about this.
389
00:25:22.169 --> 00:25:23.210
So many people do it now.
390
00:25:23.230 --> 00:25:23.710
Like...
391
00:25:23.870 --> 00:25:29.015
To do this in home services 15 years ago was insanely unusual.
392
00:25:29.095 --> 00:25:33.759
Now, I know not everybody does it, but it is so much more common now.
393
00:25:34.099 --> 00:25:41.086
Things have changed that if you're not doing this, you're just leaving money on the table and you're creating unnecessary pain for yourself.
394
00:25:41.957 --> 00:25:46.859
I was looking the other day because now we're pulling bank balances from QuickBooks for all the locations.
395
00:25:47.639 --> 00:25:50.360
And we're pulling into our dashboard that also pulls from HomeWorks.
396
00:25:50.540 --> 00:25:52.081
And so now we have a really good snapshot.
397
00:25:52.281 --> 00:25:58.643
But what's interesting is seeing the people that bill weekly versus monthly and the gyrations of the bank balance.
398
00:25:59.404 --> 00:26:04.926
And based on when I pull data of how much is in the bank balance and what that's doing to their psychology.
399
00:26:04.946 --> 00:26:07.627
And I think the whole concept of higher lows and lower highs.
400
00:26:08.547 --> 00:26:10.729
kind of helps when your bank balance is a little more steady.
401
00:26:10.749 --> 00:26:11.930
100%.
402
00:26:12.010 --> 00:26:17.094
And I would rather, you could have the same profit margin, let's call it 20% profit margin.
403
00:26:17.354 --> 00:26:25.280
But if one day you're negative five, the next day you are plus 40, you're up and down, it's very hard to make good decisions.
404
00:26:25.380 --> 00:26:34.247
And even back to what we just mentioned before, I don't hire the foreman for the extra few dollars an hour, like you had mentioned, because I have my off-season, now I have a cash crunch and I go get a loan.
405
00:26:34.467 --> 00:26:37.610
These are all decisions that are made poorly because of this...
406
00:26:38.230 --> 00:26:39.211
limitation of capital.
407
00:26:39.591 --> 00:26:50.420
And so to your point, like having a bank balance as low might put you in a place where I can't afford that extra investment in marketing or the foreman or the extra truck upgrade.
408
00:26:50.681 --> 00:26:58.708
And one thing I found is funny is when you talk about the gyrations of a bank balance, is people buy things that they don't really need based on the top.
409
00:26:59.628 --> 00:27:26.965
and make sense of it because like well i have like 100 grand i was like well that was last week now you have 20 but then when it comes to like long-term investments and what needs to happen in the company like getting an operations manager or investing in some new technology like oh no i only have 20 grand i can barely make payroll next week and so that up and down so true makes it very hard like the psychology like business is hard enough let alone with like the resources that you are trying to work with go up by 5x and then
410
00:27:27.665 --> 00:27:32.889
down by 30, 40, 50%, it's very difficult to just stay even keel and make good decisions.
411
00:27:33.470 --> 00:27:35.491
Yeah, yeah, psychology matters so much.
412
00:27:35.511 --> 00:27:40.195
Like it matters in the examples we just gave, but it matters in how you show up to your team the next day.
413
00:27:40.235 --> 00:27:46.300
It matters in how much you're keeping your foot on the gas pedal, like to go, go, go, or get that work done.
414
00:27:46.621 --> 00:27:53.666
If you're just beat down, and this is one of the things that beats you down, then you're just gonna perform at a lower level and everything's gonna be harder.
415
00:27:53.867 --> 00:27:55.328
There's just no other way to say it.
416
00:27:55.988 --> 00:27:56.649
What do you got next?
417
00:27:57.041 --> 00:28:00.985
All right, this one, you've kind of already alluded to this and it's very basic, but I couldn't do it without.
418
00:28:01.425 --> 00:28:11.154
And that is, as you're getting closer to that million dollar marker, avoiding the temptation of adding more services to get past that seven figure dollar amount.
419
00:28:11.514 --> 00:28:15.538
It's the fastest way to grow revenue, add more services, sell more to your existing customers.
420
00:28:15.898 --> 00:28:23.445
It makes a lot of sense because you don't have to spend money on customer acquisition costs, but it is almost always one of those decisions that three, four, five years later you have to undo.
421
00:28:23.925 --> 00:28:29.211
Whether you're trying to like sell the business to someone else and they're like, what's all these random services that add 5%, 10%, 15%.
422
00:28:29.271 --> 00:28:32.534
And a lot of times I find it's the person that's at six or 700,000.
423
00:28:32.574 --> 00:28:35.938
They're like, if I just added this one or two things, I get to a million.
424
00:28:36.158 --> 00:28:37.360
And it's just this number.
425
00:28:38.100 --> 00:28:41.964
But to get there, they had to compromise the simplicity of their model.
426
00:28:41.985 --> 00:28:42.305
Yeah.
427
00:28:42.705 --> 00:28:47.412
And they underestimate the complexity it adds to admin, training new technicians.
428
00:28:48.133 --> 00:28:53.039
And it's back to what we've talked about before, like the whole concierge model of like doing all services.
429
00:28:53.079 --> 00:28:54.101
Why is that not worked out?
430
00:28:54.341 --> 00:28:57.766
In a way, it's because it's like every service requires a slightly different...
431
00:28:58.026 --> 00:28:58.867
go to market motion.
432
00:28:58.927 --> 00:29:05.253
It requires a slightly different way of marketing or advertising or selling on the phone or how you train the admin person.
433
00:29:05.593 --> 00:29:12.739
And so each of those things add that level of complexity and it's so hard as an operator when you're like, well, I'll do it myself.
434
00:29:13.460 --> 00:29:16.622
But at a million plus, that's when you start to feel that pain.
435
00:29:17.062 --> 00:29:27.268
And if your goal is a million, 20%, and being able to walk away from the business for a week or two and take a vacation, one of those is going to come into jeopardy if you start adding in five, 10, 15 services.
436
00:29:27.748 --> 00:29:32.211
And I see that as the trademark of home services that are gunning for seven figures.
437
00:29:32.591 --> 00:29:34.432
It's just, I'll get there by adding more services.
438
00:29:34.492 --> 00:29:39.155
And a lot of times I find it's because the service that they're currently providing got hard.
439
00:29:39.715 --> 00:29:41.236
So they kind of started to stall out.
440
00:29:41.737 --> 00:29:43.358
They had 250 customers.
441
00:29:43.439 --> 00:29:45.761
They needed 350 to get to the million-dollar marker.
442
00:29:46.081 --> 00:29:47.743
But, man, I've been buttoning my head up against that.
443
00:29:47.803 --> 00:29:49.024
I can't figure out route density.
444
00:29:49.384 --> 00:29:50.565
I can't figure out my advertising.
445
00:29:50.585 --> 00:29:53.568
I don't really want to really laser on a different channel.
446
00:29:54.209 --> 00:29:55.170
I'll go add another service.
447
00:29:55.210 --> 00:29:57.332
And it's the easy button for just adding more revenue.
448
00:29:58.082 --> 00:29:58.282
Yeah.
449
00:29:58.703 --> 00:30:01.987
And my argument there is, in your example, $350,000 was the first service.
450
00:30:02.288 --> 00:30:05.232
When you had the second service, that was probably going to come in at about $150,000.
451
00:30:05.552 --> 00:30:08.256
The third service is going to be about $70,000 in revenue.
452
00:30:08.276 --> 00:30:09.117
It just gets worse.
453
00:30:09.658 --> 00:30:12.802
Because you never solved the underlying problems that got you stuck at $350,000.
454
00:30:12.882 --> 00:30:13.343
Yeah.
455
00:30:13.503 --> 00:30:14.565
But I mean, I just...
456
00:30:16.702 --> 00:30:17.603
I couldn't agree more.
457
00:30:17.983 --> 00:30:23.324
If anybody ever says, hey, what are the three to five things that are going to get me to a million dollars the fastest?
458
00:30:23.384 --> 00:30:26.005
This is like almost at the very top of the list.
459
00:30:26.685 --> 00:30:28.746
And I've talked about before, I've learned it the hard way.
460
00:30:28.846 --> 00:30:34.688
I mean, CityTurf is a bigger business and we still have, we've cut things and we've added some stuff back.
461
00:30:34.708 --> 00:30:36.008
We still have too many things.
462
00:30:36.509 --> 00:30:37.589
We still do too many things.
463
00:30:37.989 --> 00:30:43.493
I think the creation of a marketing calendar is a really good way to kind of figure out whether you have two things too.
464
00:30:43.953 --> 00:30:51.139
Because it forces you to ask yourself, am I trying to like squeeze in five different services into a month, a two or three month window?
465
00:30:51.819 --> 00:30:57.483
Or are these services where they have inverse demand curves, I can move them off in different parts of the year.
466
00:30:58.084 --> 00:31:01.046
And that's one of the first things I'll do if I think someone has too many services.
467
00:31:01.066 --> 00:31:02.427
I'm like, okay, let's look at 12 months.
468
00:31:02.767 --> 00:31:03.608
When do you pitch these?
469
00:31:03.988 --> 00:31:06.550
And they're like, well, they all happened right here in spring.
470
00:31:06.970 --> 00:31:08.391
I'm like, well, then what's the point?
471
00:31:08.431 --> 00:31:17.877
Like, if you just deployed that same energy, whether it be shots on goal when it comes to marketing and put that towards the other core services, you'd probably make up more revenue just doing that.
472
00:31:17.917 --> 00:31:19.017
Yeah, I believe it.
473
00:31:19.398 --> 00:31:29.844
And I'll tell you, because I'm back involved in the city turf business, one of the other things I've come to conclude around this, I always, I'll give it, I'll give us a very specific example.
474
00:31:29.944 --> 00:31:31.765
I always put fertilization and weed control.
475
00:31:31.825 --> 00:31:32.566
That's a service.
476
00:31:33.702 --> 00:31:36.250
Ah, that's like nine services.
477
00:31:36.792 --> 00:31:37.815
And here's my example.
478
00:31:37.876 --> 00:31:40.384
So if you're a fertilization weed control company,
479
00:31:41.442 --> 00:31:42.503
Yeah, you fertilize.
480
00:31:42.763 --> 00:31:43.743
Yeah, you kill weeds.
481
00:31:43.823 --> 00:31:46.945
But you also are dealing with all the issues that come with it.
482
00:31:46.985 --> 00:31:48.105
Why do I have a brown spot?
483
00:31:48.165 --> 00:31:49.986
Why is this spot in my yard yellow?
484
00:31:50.286 --> 00:31:51.807
Why is there no grass growing here?
485
00:31:53.187 --> 00:31:54.648
Why can I pull up my carpet?
486
00:31:54.688 --> 00:31:55.888
Why is this spot soggy?
487
00:31:55.949 --> 00:32:01.451
It's all part of the fertilization weed control thing because you either get blamed or it's part of grass and that's what you do.
488
00:32:01.471 --> 00:32:03.452
So now you're in the grub business.
489
00:32:03.932 --> 00:32:05.013
You're in the insect business.
490
00:32:05.073 --> 00:32:06.114
You're in the disease business.
491
00:32:06.134 --> 00:32:07.074
You're in the shade business.
492
00:32:07.094 --> 00:32:08.295
You're in the irrigation business.
493
00:32:08.816 --> 00:32:11.117
All because you just got into fertilization weed control.
494
00:32:11.478 --> 00:32:18.003
And so when I think about the marketing calendar, I look at the city turf business like, wow, we make hundreds and hundreds of thousands of dollars just doing grub treatments.
495
00:32:18.243 --> 00:32:20.825
We make hundreds and hundreds of thousands just doing fire ant treatments.
496
00:32:21.185 --> 00:32:24.367
We make hundreds of thousands of dollars doing aeration.
497
00:32:24.387 --> 00:32:25.048
Yeah.
498
00:32:25.208 --> 00:32:28.929
Those are all actually kind of... We kind of separate them.
499
00:32:28.969 --> 00:32:33.769
I know the revenue for them, but they all showed up in our business because we did fertilization weed control.
500
00:32:34.330 --> 00:32:36.350
We never were in the grub business mowing lawns.
501
00:32:36.390 --> 00:32:39.070
We only ended up in the grub business because we did fertilization weed control.
502
00:32:39.610 --> 00:32:40.891
This is where it gets crazy.
503
00:32:41.431 --> 00:32:47.332
And so as we talk about services, most people probably don't think about this way because I hadn't really.
504
00:32:47.892 --> 00:32:53.413
City turf is mowing, fertilization weed control, tree and shrub health, pest control and irrigation.
505
00:32:53.553 --> 00:32:54.253
That's the business.
506
00:32:54.833 --> 00:32:55.473
No, no, no, no.
507
00:32:55.533 --> 00:32:59.294
We're like, I mean, pest control's got rodents.
508
00:32:59.834 --> 00:33:01.294
Pest control's got termites.
509
00:33:01.374 --> 00:33:03.215
It's like pest control's got all this other stuff.
510
00:33:03.235 --> 00:33:07.156
So who knows how many service lines we're in and most of them make no money.
511
00:33:08.536 --> 00:33:10.036
But you still have to train the team.
512
00:33:10.056 --> 00:33:11.236
You still have to educate people.
513
00:33:11.256 --> 00:33:12.817
You still have to be able to talk about it.
514
00:33:13.497 --> 00:33:15.457
The office still has to be able to support it.
515
00:33:16.117 --> 00:33:18.658
I went into this whole thing like, think about that complexity.
516
00:33:18.958 --> 00:33:23.282
I was even thinking the other day, like space on your website, like it's pixels.
517
00:33:23.302 --> 00:33:25.244
You only have so many pixels that people are going to see.
518
00:33:25.885 --> 00:33:29.148
How many are they going to split up into 20 different areas?
519
00:33:29.168 --> 00:33:30.048
I have to say it.
520
00:33:30.329 --> 00:33:31.570
I have to have a menu tab.
521
00:33:31.590 --> 00:33:32.871
I need to show you a picture.
522
00:33:32.891 --> 00:33:34.172
I got SEO value for it.
523
00:33:34.212 --> 00:33:34.412
Right.
524
00:33:34.432 --> 00:33:34.613
Yeah.
525
00:33:35.213 --> 00:33:35.573
Oh, man.
526
00:33:35.753 --> 00:33:43.456
Oh, when we redid the CityTurf website, my previous website, when you click on services, the menu was like...
527
00:33:43.596 --> 00:33:44.837
I mean, it took up the whole screen.
528
00:33:44.857 --> 00:33:46.397
It was about half the page.
529
00:33:46.457 --> 00:33:52.299
It was all the junk we do because, again, if you have arborists, think about how many...
530
00:33:53.160 --> 00:33:53.860
It's unlimited.
531
00:33:53.920 --> 00:33:57.962
The diseases, the insect stuff you have to deal with, the feeding.
532
00:33:58.822 --> 00:34:01.083
So you are in so many lines of business.
533
00:34:01.823 --> 00:34:14.358
And so I do, I dream, I joke, like if city turf or whatever, I think Philip and I have talked about this, but if we were to ever expand, there is, I am absolutely certain, I'm sure Philip will go along with this.
534
00:34:14.398 --> 00:34:15.479
We would only do fertilization.
535
00:34:15.499 --> 00:34:17.081
We control pest control in the new market.
536
00:34:17.282 --> 00:34:17.842
That's all we do.
537
00:34:18.523 --> 00:34:19.563
Because it's just too much.
538
00:34:19.704 --> 00:34:26.847
If you were talking to someone that might be thinking the same thing for their business, they've heard us for the past few months ramble every single week about adding more services.
539
00:34:27.567 --> 00:34:28.928
And they have they feel like they're bloated.
540
00:34:29.068 --> 00:34:34.290
What would be some of the ways that you would identify which services to cut if they were
541
00:34:36.013 --> 00:34:37.694
thinking about potentially removing some?
542
00:34:38.394 --> 00:34:38.854
It's easy.
543
00:34:39.174 --> 00:34:40.595
Well, no, it's not easy.
544
00:34:42.175 --> 00:34:42.495
Simple.
545
00:34:43.056 --> 00:34:46.317
If it was easy, CityTurf would probably cut some things.
546
00:34:46.337 --> 00:34:57.901
Like, you know, but I would start by looking at my profit and loss statements, just really critical that you're, whether it be your profit and loss, or you log into Homeworks, or you log into whatever software system you're using, Service Autopilot,
547
00:34:59.158 --> 00:35:07.102
Just it's important that you have a breakdown of this is the amount of revenue that we've generated by service.
548
00:35:07.482 --> 00:35:09.042
Wherever you get that doesn't matter to me.
549
00:35:09.082 --> 00:35:11.203
It's just important that you can get that data.
550
00:35:11.583 --> 00:35:16.666
And if your system won't do it, hopefully you can dump all the line items from your invoice and some kind of a report.
551
00:35:16.686 --> 00:35:17.866
And you just do some manual.
552
00:35:18.126 --> 00:35:19.407
You pay somebody on Upwork.
553
00:35:19.927 --> 00:35:20.487
You don't even do that.
554
00:35:20.808 --> 00:35:23.969
You just dump it into Claude.
555
00:35:24.009 --> 00:35:25.430
That was so one year ago.
556
00:35:25.450 --> 00:35:25.570
Yeah.
557
00:35:27.130 --> 00:35:28.211
Yeah, yeah, yeah.
558
00:35:28.792 --> 00:35:32.354
You put it in the clod and you just have it tell you what to do.
559
00:35:32.374 --> 00:35:35.736
So, but that's where you start.
560
00:35:35.776 --> 00:35:39.658
So it's like, okay, well, why are we making, I'll make up some numbers.
561
00:35:39.678 --> 00:35:41.760
Why are we making 700,000 mowing?
562
00:35:42.160 --> 00:35:48.184
We're making 500,000 doing fertilization, weed control, and we made 41,000 doing aeration.
563
00:35:48.564 --> 00:35:49.145
And we've made...
564
00:35:49.905 --> 00:35:51.788
$8,000 doing flowers.
565
00:35:52.569 --> 00:35:54.872
And we made $2,000 doing grubs.
566
00:35:55.452 --> 00:35:56.373
Or whatever the thing is.
567
00:35:56.414 --> 00:35:57.715
Now, see, this is where it gets complicated.
568
00:35:57.735 --> 00:36:00.719
It's like, I don't feel like I can't be in the grub business if I'm in fertilization week control.
569
00:36:00.739 --> 00:36:02.001
It's like, I feel like I have to do it.
570
00:36:02.221 --> 00:36:06.967
Now, what I could do is not sell it as a proactive service, maybe, and just treat them when they show up.
571
00:36:07.728 --> 00:36:09.328
I don't love that, but you could do that.
572
00:36:09.368 --> 00:36:11.829
So this is where it gets complicated, but that's how I think about it.
573
00:36:11.869 --> 00:36:14.409
So in my little list there, you could knock flowers out.
574
00:36:14.729 --> 00:36:23.631
And so the next level question in my mind is, okay, if we were to kill flowers, how much revenue risk does that create?
575
00:36:23.671 --> 00:36:29.112
And what I mean by that is there are services that if you kill them, it could create revenue risk.
576
00:36:29.152 --> 00:36:32.433
And revenue risk means they leave because you can't do this thing.
577
00:36:33.913 --> 00:36:34.493
And so...
578
00:36:35.955 --> 00:36:41.539
For example, just going from weekly mowing to bi-week... Not allowing bi-weekly mowing created revenue risk.
579
00:36:41.679 --> 00:36:44.361
We gave up at least $1 million in revenue just doing that.
580
00:36:44.481 --> 00:36:44.902
At least.
581
00:36:45.382 --> 00:36:46.022
Just getting out...
582
00:36:46.303 --> 00:36:46.623
I don't know.
583
00:36:46.823 --> 00:36:47.644
That sounds about right.
584
00:36:47.684 --> 00:36:50.926
I think we gave up about $1 million in revenue getting out of bi-weekly.
585
00:36:50.946 --> 00:36:51.987
That was revenue risk.
586
00:36:52.347 --> 00:36:55.449
But we decided that was the best thing for our business.
587
00:36:55.489 --> 00:36:57.751
And so it's that kind of... You got to kind of work through these.
588
00:36:57.771 --> 00:37:00.333
So you look at each of the line items.
589
00:37:00.373 --> 00:37:03.035
How much does this thing create in revenue?
590
00:37:03.055 --> 00:37:03.455
Right.
591
00:37:03.695 --> 00:37:06.699
Could I get rid of it without harming it, the revenue?
592
00:37:06.859 --> 00:37:09.303
Or if I got rid of it, would I just lose a couple clients?
593
00:37:09.363 --> 00:37:10.104
Does it really matter?
594
00:37:10.424 --> 00:37:13.508
Could I get rid of it and just find a great flower person to record...
595
00:37:13.528 --> 00:37:17.674
In my example, somebody I could refer that's non-competitive in my other lines of business?
596
00:37:17.694 --> 00:37:18.475
Yeah.
597
00:37:18.815 --> 00:37:22.417
The other questions I'm asking myself as I'm looking at those lines, how much training are we doing?
598
00:37:22.618 --> 00:37:26.200
Do I have a special person like Bob, my flower guy?
599
00:37:26.300 --> 00:37:32.824
So I'm already at risk because if Bob ever leaves, or Bob knows he's got power over us here, and we're paying for it.
600
00:37:33.144 --> 00:37:37.227
You could just kind of go... How much of each one of these services does it personally take me?
601
00:37:37.287 --> 00:37:38.788
This is the beauty of mowing.
602
00:37:38.808 --> 00:37:41.270
You can scale mowing as an owner...
603
00:37:41.850 --> 00:37:49.501
without it consuming you, it's hard to scale $80,000 installations without it being part of taking your time.
604
00:37:49.521 --> 00:37:50.563
So I ask myself that.
605
00:37:50.583 --> 00:37:56.492
So that's kind of the brainstorm exercise that I think you go through to figure out what you can cut, what you keep.
606
00:37:56.832 --> 00:38:05.756
I think another reason why it's hard too to cut services is it's like, well, that might be a third of the core service, but it's way more profitable.
607
00:38:06.197 --> 00:38:06.917
And there's that.
608
00:38:07.357 --> 00:38:07.797
That's hard.
609
00:38:07.838 --> 00:38:08.158
Mulch.
610
00:38:08.318 --> 00:38:08.578
Yeah.
611
00:38:08.598 --> 00:38:09.118
Mulch.
612
00:38:09.218 --> 00:38:09.678
For me.
613
00:38:09.738 --> 00:38:10.059
It's like.
614
00:38:10.119 --> 00:38:10.619
Yeah.
615
00:38:10.639 --> 00:38:13.640
Like 15% margin on this, like 15% margin on this.
616
00:38:13.720 --> 00:38:14.081
But so.
617
00:38:14.301 --> 00:38:14.481
Yeah.
618
00:38:15.021 --> 00:38:15.982
And so it is tradeoffs.
619
00:38:16.022 --> 00:38:20.364
And so, well, then why don't we just maybe make you make this the core service and we cut the main thing.
620
00:38:20.384 --> 00:38:24.766
But that's a that's a large surgery, like changing whole business model.
621
00:38:24.926 --> 00:38:30.049
And real quick before we pivot, the other thing to kind of tie this back to the beginning, what you were talking about in the winter.
622
00:38:31.790 --> 00:38:36.633
That's another example of like, hey, this service might drive a lower amount of revenue.
623
00:38:36.993 --> 00:38:37.753
We should get rid of it.
624
00:38:37.793 --> 00:38:42.136
But maybe not in that scenario because it keeps you from losing money in the wintertime.
625
00:38:43.157 --> 00:38:43.637
It makes sense.
626
00:38:43.657 --> 00:38:46.358
Like CityTurf has been testing Christmas lights.
627
00:38:46.538 --> 00:38:47.559
I don't want to be at Christmas lights.
628
00:38:47.579 --> 00:38:49.060
Nobody wants to be in Christmas lights at CityTurf.
629
00:38:49.380 --> 00:38:51.242
But hey, how do you retain people?
630
00:38:51.583 --> 00:38:55.887
And so now we've added another service, but that's how we justified it.
631
00:38:56.127 --> 00:38:59.892
And I think it's right because that's how you try to protect margin.
632
00:39:00.072 --> 00:39:04.637
Now we'll tell you, if we can't build it into a big enough service, we'd kill it.
633
00:39:04.717 --> 00:39:05.978
That's where we are as a company.
634
00:39:05.998 --> 00:39:07.520
We would not keep it just to keep it.
635
00:39:07.900 --> 00:39:09.101
But I wanted to...
636
00:39:09.842 --> 00:39:12.443
Make sure that we didn't create any confusion here to what you said.
637
00:39:12.503 --> 00:39:15.525
I think solving the winter is so smart.
638
00:39:16.045 --> 00:39:16.585
So smart.
639
00:39:16.725 --> 00:39:29.771
And so this would be an example of an exception where it's like, hey, we might carry a service that produces a lower amount of revenue, creates a little complexity in the business, but it's totally justified because it's solving the bigger problem inside the organization.
640
00:39:30.289 --> 00:39:33.231
about services, the other day I was talking to a gentleman.
641
00:39:33.571 --> 00:39:37.713
He had like, I think six technicians, but they're all very skilled.
642
00:39:37.753 --> 00:39:38.694
It was a handyman business.
643
00:39:39.014 --> 00:39:43.997
And he was trying to convince me, I'm like, bro, you gotta specialize, you gotta cut down how many services you offer.
644
00:39:44.017 --> 00:39:47.379
He's like, wait, wait, he's like, I do very, like, we just have one service.
645
00:39:47.399 --> 00:39:48.040
I'm like, what's that?
646
00:39:48.280 --> 00:39:49.460
He's like, handyman.
647
00:39:50.621 --> 00:39:51.382
bro.
648
00:39:52.062 --> 00:39:52.963
I'm like, what?
649
00:39:53.063 --> 00:39:54.064
Don't you touch the house?
650
00:39:54.184 --> 00:39:55.524
She's like, oh no, we do everything.
651
00:39:55.565 --> 00:39:58.707
I'm like, the worst ever.
652
00:39:59.227 --> 00:40:00.488
That's a perfect example.
653
00:40:00.508 --> 00:40:03.230
That's a better example than my fertilization weed control.
654
00:40:04.070 --> 00:40:04.591
All right.
655
00:40:04.611 --> 00:40:05.231
What's your third one?
656
00:40:06.012 --> 00:40:07.212
My third one is retention.
657
00:40:08.333 --> 00:40:13.357
I just, I mean, and it's just, it's not that we, none of us think about it.
658
00:40:13.377 --> 00:40:15.258
It's not that we don't focus on it, but
659
00:40:16.520 --> 00:40:29.713
I will tell you, when I started CityTurf and when I started Service Autopilot, not that we got it right or got it perfect, but the focus from the beginning where I was willing to sacrifice margin was quality and customer service.
660
00:40:30.514 --> 00:40:31.295
As best we could.
661
00:40:31.435 --> 00:40:31.715
Again...
662
00:40:33.843 --> 00:40:34.923
we didn't get it right all the time.
663
00:40:34.963 --> 00:40:35.623
None of us do.
664
00:40:35.744 --> 00:40:41.765
But that was really an area where we spent money and it plays directly into retention.
665
00:40:41.845 --> 00:40:45.325
And I think it also builds brand in the long term, which is not where we're going here.
666
00:40:45.665 --> 00:40:48.526
It just pays massive dividends for a long time.
667
00:40:49.366 --> 00:40:50.186
But it costs...
668
00:40:50.526 --> 00:41:00.188
It truly does cost you money to be really good and have really good people and be really good at customer service, as I said.
669
00:41:00.208 --> 00:41:00.788
Yeah.
670
00:41:00.928 --> 00:41:07.379
But the way it pays is so unbelievably important as the business starts to get bigger.
671
00:41:07.399 --> 00:41:12.907
So you just kind of imagine the scenario where if in your market, pretty typical retail,
672
00:41:13.969 --> 00:41:19.313
churn, number of people leaving because they're selling their homes or whatever's happening in that market.
673
00:41:19.833 --> 00:41:21.174
Plus, people get divorces.
674
00:41:21.294 --> 00:41:22.935
Plus, people lose their jobs.
675
00:41:23.055 --> 00:41:26.457
Plus, people will get mad at you no matter how good you are most of the time.
676
00:41:27.018 --> 00:41:32.161
Just let's for an easy math say, there's just not much you can do to get around losing 20% of your clients.
677
00:41:33.787 --> 00:41:38.231
As the business gets bigger and bigger, just think about what that means.
678
00:41:38.511 --> 00:41:42.214
If you think about the business you have now, how hard is it just to grow 20%?
679
00:41:42.575 --> 00:41:43.616
That's hard.
680
00:41:44.176 --> 00:41:48.900
And that gets harder and harder as the company gets bigger.
681
00:41:49.261 --> 00:41:54.165
But if you have bad retention, you have to first...
682
00:41:54.205 --> 00:41:55.526
If you lose 20% of your clients...
683
00:41:58.013 --> 00:42:00.615
The math is wrong here, but it'll just make a very simple point.
684
00:42:00.675 --> 00:42:08.480
If you lose 20% of your clients, the first thing you have to do next year is grow the business by what feels like 20% just to get the break even.
685
00:42:08.820 --> 00:42:12.603
And then you got to grow it by another 20% just to get the 20% growth.
686
00:42:13.043 --> 00:42:15.385
That math doesn't work, but you get the idea.
687
00:42:15.965 --> 00:42:17.185
That is hard.
688
00:42:17.486 --> 00:42:27.569
When you've got 100 clients and you lose like 10, 15, 20, it's like that really is a bummer, but it doesn't feel as bad as having to replace hundreds.
689
00:42:28.149 --> 00:42:35.211
Or someday, if you get really big, thousands of clients a year, just to get to break even, then the thousands more to grow the business.
690
00:42:35.252 --> 00:42:35.712
And so...
691
00:42:36.892 --> 00:42:39.074
This is a thing that will...
692
00:42:39.654 --> 00:42:46.478
The things that get you retention, quality, customer service, will pay dividends massively.
693
00:42:46.598 --> 00:42:49.700
It'll drive down your marketing spend in the long term.
694
00:42:50.041 --> 00:42:52.162
It will make selling easier.
695
00:42:52.522 --> 00:42:54.163
It will make growing the business easier.
696
00:42:54.403 --> 00:42:58.606
It'll make the quality of your brand better, which makes selling easier, which makes your marketing work better.
697
00:42:58.726 --> 00:42:59.647
There's just so many...
698
00:43:00.147 --> 00:43:04.830
The things that it takes, as I said, to get higher retention, just pay in so many ways.
699
00:43:04.890 --> 00:43:08.953
And so it's worth thinking about this as early as you can in the business.
700
00:43:09.945 --> 00:43:11.466
Yeah, it was amazing.
701
00:43:11.806 --> 00:43:13.628
We just recently have got all this churn data.
702
00:43:13.648 --> 00:43:15.109
So like I've been geeking out about it.
703
00:43:16.049 --> 00:43:21.974
Probably the best metric that I was most proud of is the fact that a year ago, our 90-day churn, I'm not proud of it.
704
00:43:21.994 --> 00:43:22.514
It's really bad.
705
00:43:22.654 --> 00:43:23.955
Wait, which company are we talking about?
706
00:43:24.035 --> 00:43:24.575
Oh, Augusta.
707
00:43:24.596 --> 00:43:27.157
So all the system-wide metrics we pull in.
708
00:43:27.217 --> 00:43:29.979
So system-wide, again, not proud of this number.
709
00:43:29.999 --> 00:43:30.760
Okay.
710
00:43:31.040 --> 00:43:36.982
A year ago was in the first 90 days, we lost 20% of customers, 20.8% of customers.
711
00:43:37.042 --> 00:43:40.943
Not good in the first 90 days of setting up a recurring service.
712
00:43:41.503 --> 00:43:45.325
But with all the work put towards it, this year, it's 10.2%.
713
00:43:46.525 --> 00:43:47.907
Oh, that's a massive change.
714
00:43:47.947 --> 00:43:48.628
Half, right?
715
00:43:48.708 --> 00:43:52.793
And so what's challenging is describing how amazing that is.
716
00:43:53.393 --> 00:44:02.004
It's like, that is gargantuan, but it's so much more fun and exciting to go after customer action costs, new customers, get more customers.
717
00:44:02.344 --> 00:44:02.504
But-
718
00:44:03.285 --> 00:44:07.986
Until you get to this million dollar market like we're talking about today, that's when you start feeling the effects of churn.
719
00:44:08.466 --> 00:44:17.647
Because if you have 300 customers and you churn, let's just call 30% a year, you have to go out and get 100 new customers every year just to stay flat.
720
00:44:18.328 --> 00:44:23.909
And now let's assume for a minute that you don't have enough referrals or word of mouth or SEO coming in.
721
00:44:24.169 --> 00:44:25.069
You're going to have to go pay for that.
722
00:44:25.449 --> 00:44:26.769
It does show up on the P&L.
723
00:44:27.109 --> 00:44:32.090
It just regurgitates itself up on the advertising and marketing spend to be able to replace your churn.
724
00:44:33.010 --> 00:44:41.252
And so seeing that number has been like so eye-opening for, I think, a lot of our owners, but like really being able to understand the impact of churn.
725
00:44:41.612 --> 00:44:46.953
And more importantly, even some of the things we talked about, like making decisions to add more services because I can't get to a million.
726
00:44:47.594 --> 00:44:50.074
Is that the problem or is it the fact that you have 20% churn?
727
00:44:50.454 --> 00:44:52.375
And if we just solve that, you'd immediately double the business.
728
00:44:52.575 --> 00:44:54.935
Like, again, it's always a math equation.
729
00:44:54.995 --> 00:45:01.597
You can just take how much recurring revenue is coming in, new customers divide that by your churn rate every month, and you have where you're going to stop growing.
730
00:45:01.617 --> 00:45:02.137
Yeah.
731
00:45:02.277 --> 00:45:05.401
And so, yes, you could double how many new customers you get.
732
00:45:05.762 --> 00:45:13.032
I think for most people, focusing on reducing their churn by half would allow the exact same outcome with probably less expense.
733
00:45:14.033 --> 00:45:14.534
Tons less.
734
00:45:14.814 --> 00:45:15.876
Yeah, you'll have more margin.
735
00:45:17.081 --> 00:45:17.201
Okay.
736
00:45:17.221 --> 00:45:17.661
All right.
737
00:45:17.701 --> 00:45:19.422
I'll move on to my third and final one here.
738
00:45:20.122 --> 00:45:22.723
And I think we've talked about this a little bit too.
739
00:45:23.303 --> 00:45:24.324
I made a video recently about it.
740
00:45:24.344 --> 00:45:30.366
And that is like when capital constrained from that zero to a million dollar marker is like just stair step growth.
741
00:45:31.067 --> 00:45:37.409
And how I like to think about it is like the first year, first half of the year, first six months is I'm growing typically during your busy season.
742
00:45:37.849 --> 00:45:39.350
And in the second half, I'm going to optimize.
743
00:45:39.370 --> 00:45:39.890
Yeah.
744
00:45:40.010 --> 00:45:46.674
Instead of just constantly, you know, peddling the metal, I'm buying trucks, I'm hiring people, I'm getting my supply way ahead of my demand.
745
00:45:47.515 --> 00:45:56.080
And I think it's okay if you have this ambition of building a million dollar business that's 20% profitable, is grow and then optimize.
746
00:45:56.460 --> 00:45:57.561
Grow and optimize.
747
00:45:58.561 --> 00:46:00.062
Optimize your profitability, et cetera.
748
00:46:00.462 --> 00:46:02.463
And then the first half of the year, it's like, I'm hiring.
749
00:46:02.563 --> 00:46:03.603
I'm advertising.
750
00:46:03.643 --> 00:46:04.684
I'm getting new customers.
751
00:46:05.224 --> 00:46:12.587
But I think the reason I talk about that is a lot of times people will spend a lot of their marketing dollars in the time of the year where their customer operating cost is the highest.
752
00:46:13.308 --> 00:46:18.430
And it's in this pursuit of growth versus, okay, I will grow when I can grow something.
753
00:46:18.950 --> 00:46:28.439
at a lower customer action cost, and then I will optimize my business when it doesn't really make any sense for me to go buy more customers and keep advertising and plowing money into marketing.
754
00:46:28.879 --> 00:46:34.144
But anytime I see when someone is hungry for growth, to your point, it costs a little extra to get that foreman.
755
00:46:34.465 --> 00:46:35.906
It costs a little extra to get the extra truck.
756
00:46:36.647 --> 00:46:41.591
When you're way ahead of your skis and you have three extra trucks, two guys you don't really need on the payroll,
757
00:46:42.593 --> 00:46:44.234
everyone's kind of kicking around because of it.
758
00:46:44.254 --> 00:46:45.716
They know there's not a lot of work going on.
759
00:46:45.736 --> 00:46:47.057
They want to get their 40 hours in.
760
00:46:47.417 --> 00:46:50.139
That's when I start seeing a lot of bloat and a lot of waste.
761
00:46:50.440 --> 00:46:52.481
And then people never make a profitable business.
762
00:46:52.501 --> 00:46:54.483
They grow, but they never grow profitable.
763
00:46:54.503 --> 00:46:56.685
They grow a large, unprofitable business at the end of the day.
764
00:46:57.105 --> 00:47:08.275
And I think the kind of happy medium I've seen, assuming you're capital constrained, meaning you don't have loans or money that you can just keep pumping to the business, is grow for half the year and then optimize.
765
00:47:08.915 --> 00:47:12.736
Raise your prices, move that the bottom 10%, increase their prices.
766
00:47:13.156 --> 00:47:21.338
That stair-step approach to where now when you have a million dollars, it's 20%, not you've grown and grown and grown and you get to a million dollars and realize I'm actually losing money.
767
00:47:22.058 --> 00:47:22.898
Yeah, it makes a lot of sense.
768
00:47:22.938 --> 00:47:27.459
So you gave the example of raising prices on the bottom 10% or some percentage of the business.
769
00:47:27.819 --> 00:47:38.382
What are examples of safe places to dial back your spend, your expenses to clean up the business, to optimize?
770
00:47:39.492 --> 00:47:42.133
Advertising is a low-hanging fruit, especially if you're trying to grow.
771
00:47:42.453 --> 00:47:46.254
Just dial back when you know customer action cost starts to literally double or triple.
772
00:47:46.994 --> 00:47:48.475
Is that a cut it in half?
773
00:47:48.535 --> 00:47:49.535
Is that eliminate it?
774
00:47:49.975 --> 00:47:51.636
What does that mean?
775
00:47:51.956 --> 00:47:59.078
I think the thing that I've seen be useful is understanding what your actual capacity is so that when you hit it, you know you can dial back marketing.
776
00:47:59.098 --> 00:48:00.718
You know you can dial back advertising.
777
00:48:00.738 --> 00:48:02.699
You only need to get a certain number of customers.
778
00:48:03.319 --> 00:48:28.980
and being able to know okay with this number of employees and this number of trucks i can complete this much revenue or this many budget hours and when i hit it i know i'm going to raise prices and i'm not going to go out and just willingly buy a truck or extend my capacity late in the season when i know that vehicle is not going to get used very much for after the next few weeks and understanding what your demand curve is and matching it with what i'm spending on marketing uh
779
00:48:30.441 --> 00:48:31.282
That's a low-hanging fruit.
780
00:48:31.302 --> 00:48:43.374
I think the other part is just, even when it comes to admin, like, can I somehow make that a variable expense that when I get less busy, I'm able to dial that expense back?
781
00:48:44.355 --> 00:48:52.703
Anytime anything fixed, immediately that's the first thing I'm looking at, is can I bring my fixed expenses down to make sure that when I'm optimizing the business, it's actually profitable?
782
00:48:54.167 --> 00:49:02.938
Are there any forms of expenses you've seen people try to cut to get more profitable and you'd say, no, no, this never goes well?
783
00:49:03.839 --> 00:49:04.580
Anything come to mind?
784
00:49:05.172 --> 00:49:05.552
Oh, man.
785
00:49:06.073 --> 00:49:11.517
If you got really sharp, like things like benefits and stuff like that, I'm not going to touch the culture of the business.
786
00:49:12.037 --> 00:49:12.257
Yeah.
787
00:49:12.397 --> 00:49:17.741
I think being able to do a good cost analysis, I'm like, okay, what's the cost of this expense?
788
00:49:18.562 --> 00:49:20.303
If I do cut it, what's the downside?
789
00:49:20.623 --> 00:49:22.604
For example, I'll rip out all the admin.
790
00:49:22.624 --> 00:49:23.225
I don't need them.
791
00:49:23.445 --> 00:49:25.366
Well, are you going to replace them?
792
00:49:25.627 --> 00:49:28.509
How long does it take to train them up of your time?
793
00:49:28.549 --> 00:49:28.789
Right.
794
00:49:29.109 --> 00:49:32.271
And so I think it's rare that someone has...
795
00:49:33.512 --> 00:49:36.354
people expenses that I think they need to rip out.
796
00:49:36.495 --> 00:49:38.837
I think you can take this way too far and rip stuff out.
797
00:49:39.237 --> 00:49:48.725
But I certainly think it's a matter of trimming and optimization, not necessarily like, I need to change the business model during this time of the year, or like the second half of the year, I'm just like cutting everything.
798
00:49:48.745 --> 00:49:57.932
It's like, can we take 5%, 10%, 15%, look for these areas of opportunity, reduce our spend on marketing and the offensive measures that we had when customer marketing cost was low?
799
00:49:58.653 --> 00:50:02.336
But nothing comes to my mind that I see people go like way overboard because usually it's pretty obvious.
800
00:50:02.356 --> 00:50:09.060
Like if I if I, you know, ask Sally at the end of the season because she's overhead, I'm going to have to replace Sally next spring.
801
00:50:09.481 --> 00:50:10.221
You'll pay for it.
802
00:50:10.261 --> 00:50:10.582
Yeah.
803
00:50:11.042 --> 00:50:13.864
So I don't usually see that one being cutting too deep.
804
00:50:15.773 --> 00:50:18.715
I know there was so many other things we could have talked about here.
805
00:50:19.115 --> 00:50:24.378
I think this list of six is great because it's not the same thing we talk about all the time.
806
00:50:25.178 --> 00:50:42.427
If you think about what you've seen over the years within Augusta or just all the different people you've interacted with, of those people that are trying to get to a million dollars, what would be the top two problems, places to focus that it's the thing you see the most?
807
00:50:43.592 --> 00:50:55.136
The thing that came to mind, just because it's top of mind for me, was taking your P&L as whether or not your business is profitable instead of individual departments, individual crews, individual employees, like being able to break it down.
808
00:50:55.996 --> 00:50:57.957
And the reason it's top of mind, I just got off a call with someone.
809
00:50:58.177 --> 00:51:02.518
They're doing probably $3 million in revenue, but they weren't able to tell me which of their crews were most efficient.
810
00:51:02.798 --> 00:51:04.300
or which ones were profitable and not.
811
00:51:04.521 --> 00:51:08.487
They just know, overall, we're about 15% profitable.
812
00:51:08.927 --> 00:51:15.637
And I know, especially because they have no pay for performance, I know that some of those crews are 30% profitable, and some of them are 5%.
813
00:51:16.158 --> 00:51:17.059
And so I think...
814
00:51:17.965 --> 00:51:31.094
looking at this bucket of all the revenue and all the expenses in my business versus their individual departments, their individual services, their individual crews and employees, and each of those can be profitable or unprofitable at varying degrees.
815
00:51:31.974 --> 00:51:44.803
And not zeroing in on that is leaving a lot of money on the table simply because I'm looking at this aggregate 30,000 foot view of my P&L instead of a more zeroed in approach on the service, the employee, or the department.
816
00:51:45.732 --> 00:51:48.495
Yeah, that makes a ton of sense.
817
00:51:48.875 --> 00:51:49.756
And what about yourself?
818
00:51:50.177 --> 00:51:51.158
Do you have anything that comes to mind?
819
00:51:51.478 --> 00:51:58.445
Well, the reason that I talk about the 5 for 50 concept of the two engines is that is something I...
820
00:51:58.485 --> 00:52:05.452
I mean, there's so many things, but it's a top level thing that I think the two most important things inside the business...
821
00:52:06.053 --> 00:52:07.994
Get work, get people to do the work.
822
00:52:08.554 --> 00:52:13.257
And so I like to always think about the macro things, the biggest levers you can pull on.
823
00:52:13.797 --> 00:52:19.000
And so the not getting enough people or not getting enough revenue, it varies by company.
824
00:52:19.020 --> 00:52:21.042
Some people you talk to, it was like, I got plenty of people.
825
00:52:21.162 --> 00:52:22.943
Some people you talk to, it was like, I got plenty of work.
826
00:52:23.103 --> 00:52:23.663
It varies.
827
00:52:23.983 --> 00:52:26.525
But it's usually one of those two big problems
828
00:52:27.425 --> 00:52:28.566
And if you look at...
829
00:52:28.706 --> 00:52:30.508
I love the concept.
830
00:52:30.588 --> 00:52:34.231
It's like, Hey, you can tell me what is most important to you in life.
831
00:52:34.692 --> 00:52:37.694
But all I have to do is look at where you spend to know what's really most important to you in life.
832
00:52:38.560 --> 00:52:41.964
And finding people or finding customers is the perfect example.
833
00:52:41.984 --> 00:52:44.786
We all run around and say, we're doing marketing, we're doing this, we're doing that.
834
00:52:44.806 --> 00:52:51.373
But if you look at what we're really doing, especially when it comes to recruiting, it's like spending 30 minutes a week on this thing.
835
00:52:52.134 --> 00:52:56.658
If this is really the biggest thing that's causing you problems, why are we spending 30 minutes on it?
836
00:52:56.899 --> 00:52:57.099
Mm-hmm.
837
00:52:57.974 --> 00:53:04.398
And it's like, well, I hate doing this because I have to go through so many people and I have to talk to so many people and most of the people are just going to quit anyway.
838
00:53:04.438 --> 00:53:05.739
So it's like, oh, okay.
839
00:53:05.759 --> 00:53:08.041
So we're just going to give up.
840
00:53:08.061 --> 00:53:10.302
We're just going to talk about the problem.
841
00:53:10.503 --> 00:53:13.665
So I tend to think this is one of the top level problems for people.
842
00:53:13.685 --> 00:53:16.387
It's like, which is your biggest constraint at the moment?
843
00:53:16.487 --> 00:53:17.968
Meaning which is the thing that you...
844
00:53:19.135 --> 00:53:21.017
whine and moan and cry about all the time.
845
00:53:21.077 --> 00:53:22.298
I'm not, you know, we all do this.
846
00:53:22.578 --> 00:53:22.899
Me too.
847
00:53:23.379 --> 00:53:25.641
And like, what's the thing you whine and cry about the most?
848
00:53:25.701 --> 00:53:26.822
Okay, there's your hint.
849
00:53:27.363 --> 00:53:28.844
That's what should get all your time.
850
00:53:29.105 --> 00:53:30.426
Like as much as you can.
851
00:53:30.886 --> 00:53:31.247
Fix it.
852
00:53:31.527 --> 00:53:34.350
Now, what's the new thing you're whining and crying and moaning about all the time?
853
00:53:34.690 --> 00:53:35.891
That's the thing that should get all your time.
854
00:53:35.931 --> 00:53:37.353
If you just sort of do that...
855
00:53:38.376 --> 00:53:41.857
your stuff will go so much faster, but that's not what we do.
856
00:53:42.018 --> 00:53:43.258
It's not what I do a lot of times.
857
00:53:43.278 --> 00:53:48.260
Like I can whine and cry and moan about the pest control business that CityTurf isn't growing as fast as it should.
858
00:53:48.640 --> 00:53:49.901
And then you look at what Jonathan does.
859
00:53:49.921 --> 00:53:52.262
He's like, hey, I want to work on my welcome package.
860
00:53:52.302 --> 00:53:53.222
I want to work on this.
861
00:53:53.322 --> 00:53:54.483
I want to work on this cool idea.
862
00:53:54.723 --> 00:53:56.123
Mike says I should be doing Facebook.
863
00:53:56.183 --> 00:53:57.984
My goodness, we should be doing Facebook this year.
864
00:53:58.284 --> 00:53:59.765
Like we all do it.
865
00:54:00.245 --> 00:54:01.225
You know, we all do it.
866
00:54:01.245 --> 00:54:07.328
And so the problem most of us have is like just focusing on the single biggest constraint, the single biggest problem.
867
00:54:08.303 --> 00:54:10.564
for a while and then moving to the next one.
868
00:54:10.584 --> 00:54:13.425
If we just do that, it sounds so easy, but so hard.
869
00:54:14.265 --> 00:54:14.845
It's so much better.
870
00:54:15.145 --> 00:54:16.306
Excellent way to wrap it up there.
871
00:54:16.366 --> 00:54:21.567
For everyone that's listening down below, I'd like you to comment, what's the one thing that you're going to take action on?
872
00:54:21.668 --> 00:54:22.408
Good idea, love that.
873
00:54:22.428 --> 00:54:23.588
So we have these six tips.
874
00:54:23.688 --> 00:54:27.189
We've also spit fired multiple ways and improvements.
875
00:54:27.730 --> 00:54:29.770
There's even for larger operation, there'll be a lot here.
876
00:54:30.030 --> 00:54:32.151
So down below, this is the action step.
877
00:54:32.211 --> 00:54:34.492
You got to comment, what are you doing this week?
878
00:54:35.152 --> 00:54:39.435
And by the time next week comes, we will talk about million dollar operators and how to go to 10 million.
879
00:54:39.775 --> 00:54:41.236
But for now, what are you?
880
00:54:41.256 --> 00:54:42.837
No private equity in AI, though, next week.
881
00:54:42.897 --> 00:54:43.557
I'm not bringing in.
882
00:54:43.858 --> 00:54:45.178
We're done with that for a little while.
883
00:54:45.318 --> 00:54:45.739
We're just good.
884
00:54:46.019 --> 00:54:46.559
Here's how you do it.
885
00:54:46.919 --> 00:54:47.280
Exactly.
886
00:54:47.400 --> 00:54:49.881
But comment below what you're doing this week to take action.
887
00:54:49.901 --> 00:54:51.262
But I appreciate all of you listening.
888
00:54:51.482 --> 00:54:52.563
And we'll see you next week.
889
00:54:52.883 --> 00:54:53.163
Take care.
890
00:54:53.183 --> 00:54:53.443
Same.
891
00:54:53.484 --> 00:54:54.104
See you guys next week.