4 Silent KILLERS of Contractor Sales | David Yoho (Ep. 260)

You shouldn't have people working for you who are doing something you don't understand. That's going to put you in a precarious position, especially if that person leaves you. Or maybe that person is going to take advantage of you somehow.

Don't delegate when you don't understand it, especially when it comes to the money. All right, everybody, I have got a treat for you. For the first time ever, And I can't believe I'm saying that. You should have been here a long, long time ago.

But yes, I—

but he's finally here. The one and only David Allen Yoho. I've been thinking about you and I've been thinking about this recording and it's like, what do you ask the person that probably knows more about the home improvement industry than just about anybody that's out there?

Well, that's kind of you to say. It just means I'm old.

I wouldn't call it old, let's call it experienced.

Thank you.

So for those people that may not know who you are, why don't you give us your backstory? 'Cause you really helped shape what this industry has become. If it really, if it wasn't for your father and for you and for a couple of others related to you, this industry would look very different. That's not hyperbole or what do you call it? Like exaggeration. It's the absolute truth. So tell us who you are and what you've done.

Well, essentially, of course, I grew up in, in this business. My dad was president of what was the largest re-roofing company in the country. I was put to work at 11, and so I had a work ethic. And interesting, I, of course, I was working as an installer in the warehouse, but a fascinating thing happened that, that changed my life. Going back about 1,000 years ago, contractors pretty much generated all their own leads. There was very little lead generation. And so my dad had this idea that they could generate leads by phone. Now we're going back into the late '50s. No one was doing that. And so it was 1966 and I was in school and they had a couple of elderly people did that in the business. And one of them got ill. I asked to do the job. My boss said no. I asked why not, and a few minutes later I'm on the phone generating leads. So by late '60s, I had done some canvassing. I closed my first in-home deal early on. The story of my real career happened in the late '70s. My dad was doing consulting, had sold off most of his business, and he brought me on board because I knew how to do something that at the time no one knew how to do, and that was how to organize a team of people that could generate leads And so I started 50 of them in 5 years. But at the same time, I had joined the National Speakers Association and being a person that takes what he does seriously, but, but not too many other things. I had a sense of humor or timing and using humor. Anyway, I became a professional speaker. And so at a very young age, I found myself giving speeches for companies I never would've dreamed of. And, but it was the phone skills in this business. It was the lead generation skills that led me to learn how to do these other things. And next thing you know, I'm in business to business and I retired the professional speaking business 8 years ago, 40 years of it was enough, but I'm now still doing the same things that I've been doing and which is providing systems and structure to help companies not just increase their sales, but to do it at a higher level of profit, but while improving the customer experience. Well, of course, that, that should improve the way people rate your customer service experience. That's essentially how I've lived my life. I've created and produced 400 or 500 customized audio training programs and video training programs, and Frankly, I owe my life to this industry. Being a— growing up as a contractor and working with contractors my whole life has been very rewarding. And so all the big name companies that I got into, I always wondered humorously what they would have thought if they knew they were basically bringing a contractor and a lot of big recognizable names that I won't drop on here because that's not what we're here for.

You were on the road inside of home improvement companies, traveling to home improvement companies, helping them with lead gen systems, sales systems, profitability. Have you ever thought about how many companies you've actually been inside of?

By the way, I'm still traveling. I'm limited to 35 nights a year, but a lot more of this can be done in videos just like this today. So, I mean, I don't know the names of the companies. It's, it's been way too many, but You know, the speeches was crazy because those were mostly onesies for these companies.

No, but I'm talking about when you would actually fly out, not, you know, show up at the office, whether you had one person you were talking to or you had a team of 100 people you were talking to, it had to be in the thousands, wouldn't it?

Probably.

Yeah.

I never counted that because there were a lot of people who I visited once and then put another account executive in on. So. No, Brian, it would scare me to know the number.

Yeah, you actually went into businesses. It's one thing to look— I mean, this is great. And I think we give a lot of great content here. And it's absolutely free. And people can listen to it anywhere they want. But to actually have somebody like you come into the business and work with somebody one-on-one is pretty, pretty powerful. Now, over the years, you've worked with a lot of the big name companies. You also have worked with a lot of companies that are no longer here. That's, I would say, almost entirely because they did not implement what you suggested. And so, can we talk a little bit about, from your experience, what made somebody successful in this business? What were the characteristics, the traits, the habits? What was it that made people, or what is it that makes people successful? In this business?

You know, fascinating question because people define success differently.

Yep.

Some people want to be the biggest and find out that their profit margins were too low and they made more money at, at half the size. So to me, success would be operating a business that is profitable, that also serves the internal community, the external community, and people believe that they that they received as much or more value than you promised. But I will tell you that this is too easy in this respect. The number one reason people were not successful is they didn't earn enough money. People say, I got out of the business for this reason and that reason. Although I have to say, half of the larger clients that I served in the last 10, 15 years have been rolled up, bought out.

Yep.

By very large names. And so some of them ended up making more money than they ever dreamed. But the number one reason is they don't earn enough money. And Brian, this is sad because it's generally not one thing. It's several things from not understanding how profit and loss works to not being able to do it on a short-term basis or to leave that responsibility up to your accountant, who is not the person who's responsible to help you make money because they don't really understand your business. Now, we can go a lot of directions with that.

For me, success is very much— the definition of success is very much like yours. It's really up to the individual. What do they decide is success for them? And for me, it's, you know, we use the business to fund our ideal lifestyle, to serve our family first, the people that we love, the people that are the ones that suffer because of the decisions that we make. But also our team and our, our community and whatever that happens to mean. You know, there's, we have people that do $2 or $3 million a year in revenue. They make a few hundred thousand dollars a year and they're happy as clams. And then you and I know people that are doing $700 and $800 million a year and they're still going, you know, they haven't hit success yet. So success is very personal. And I guess maybe that's the, the right way to ask that question is, What makes these businesses work and how do owners screw 'em up? And I think one of the ways they screw 'em up, I think what you might be alluding to here is that they don't understand their numbers. They don't understand how profit works in this business, and they chase revenue thinking that, well, if I just have enough revenue, eventually I'm gonna make money. But you and I both know that's not true.

You cannot outsell a poor financial structure.

Yeah.

You just make it worse and lead to your demise quicker. And there have been clients over the years that I would not work with because what they wanted me to do would be more disadvantageous to them than any help I could give them, which is kind of ironic if you think about it.

Well, and it's interesting because you are one of the greatest sales trainers this industry has ever known. And you're known for a lot of things, but that's also one of them. And a lot of people would hire you to come in and fix their selling system. And funny enough, you would probably come into a lot of these companies and say, well, wait a minute, guys, you brought me here for selling, but you don't really have a selling problem. You have a pricing problem. You have a customer experience problem. You have— am I right?

Yes. And I found myself in those situations over the years. And the easy, the easy route is to take what they give you and go in there. But I modeled my practice after a doctor. It being that before I would go in the first time, and I didn't learn this right away, it took me a few years in the business to figure this part out, was to understand that what the, the patient or the contractor said their problem was might've been incorrect. And I would say, One of the real problems I've seen in this business is that contractors tend to misdiagnose their own problems. So they call someone like me, and there's a lot of people like me out there today, and those people will go in and do it. So to your example, I learned to ask certain questions first and tempted to make that observation. Now, it costs me some work, but in my opinion, you need to do a proper physical for someone first and ask certain kinds of questions. What's fascinating to me is sometimes these simple questions that involve finances, people are saying, well, I have to ask my accountant. Really? You know, your accountant should be asking you questions, frankly. And like, how's business, right? And so, but again, that's someone you shouldn't rely on no more than you should rely on the government to tell you what kind of food you should be eating.

You know, Mark Curry, well, Mark Curry and I for the last few years were doing a profit workshop because nobody was really teaching anybody how to make money. Money in this business. And Mark has a great financial management system. So we started to teach it. Then we started to realize, crap, these people are relying on their bookkeepers and their accountants. They don't have a clue what this business is about.

Not a clue.

And so we actually started a company called the Profit Masters where we're attempting to go out and teach them how to be profitable. Let's talk about what are some of the reasons why companies are not as profitable as they should be?

You know, I'm going to name 3 or 4, but I want to come back to the root of it. 3 or 4 is their leads cost too much. They convert too few of them. Their compensation plans are not in line. They get the compensation plan from someone else. They get their pricing from someone else. Wrong thing to do because every business has a different cost structure. They manage their leads poorly. They don't get enough demos, and this is and always will be a demo business. So, several things. One is simple methods to help a company ensure that the price that they're charging is the right one. But this is again where people fail in follow-up. You need to cost every single job. It doesn't— every single job. And someone, usually the owner of the business until it gets too large, needs to look at every single one of those figures when the job is complete. Now, you have to have a simple system to do it. Some people are thinking, oh my God, that would take too long. It doesn't if you have a system to help you do it. But I want to go back to this, Brian, because for the most part, most of us are working on small margins in a business where you have to spend most of the cost way before you get to the profit. And so when we talk about cash flow, people think that that means how much money you have in the bank or what your, what your profit is based on. And that's not true. So if you're buying leads and you have a business and you have people working for you, your overhead costs are all paid before you get that money. So how long does it take you to get the money? So let's put aside cash flow for a minute. If you're relying solely on your profit and loss statement, one of the problems is that because of the way the money is spent and the way it comes in, it takes too long with a profit and loss statement. And a monthly profit and loss statement is not always accurate of your true success because, again, of maybe of the way your accountant does it. So one of the things that we have done over the years that has helped people immensely is to develop a way weekly and more important, monthly to be able to look at whether the business is profitable or not. And we do that by measuring the sales against the leads that are coming in against the lead costs for the month. So as a perfect example, you might be doing a big direct mail program and you pay a direct mail house to create a, a thing and you buy a list and you, you spend all that money. Well, your accountant's gonna put that into March. Let's say if you spend the money in March, although The mailers don't go out till May or June. And so what you need is a way to look at your business. Not that your profit loss statement isn't important, but you need a way to look at the business as the money I'm actually spending in May, even though I spent it March against the sales from that month. We call it a lead source report. But most of my clients will tell you, once we got them on that, that enabled them to look at this critical part of your business. Because let's face it, it's probably a third of your costs go into that. And your overhead costs tend to be a little bit more static. In other words, they, they're more consistent and they remain the same unless you're making some crazy changes in your business. So to be able to look at your sales and marketing costs together every month is a big part of knowing where you stand. Unfortunately, this is a a business that is run on a short-term basis. So you have to be able to look at your finances on a short-term basis and look at your cash position every single week. And so there are people out there who are good salespeople or great installers, production people, and maybe they don't like this part. Well, this is where you not only need to go get help, you need to learn it for yourself. And maybe there's a time that you delegate it, but you don't delegate this at a time when you don't understand it. You shouldn't have people working for you who are doing something you don't understand. That's going to put you in a precarious position somewhere down the line, especially if that person leaves you, or in the odd case that maybe that person is going to take advantage of you somehow or hold you hostage with that information.

I'm writing that down. That was a great line, by the way. Don't delegate when you don't understand it. Don't delegate, especially when it comes to the money. So talk a little bit more about this because, you know, I was, we just had our, our big Success Society intensive last week and, um, a great new member came up to me and said, hey, I'm not making money. They're doing $10 million. They're not making money. And, and, and we talked a little bit about, and she said, my lead costs have gone through the roof. Can you talk a little bit about how you look at that, how you measure it, how you know it's profitable and it's not profitable?

Well, it depends on your business, but you, almost every business needs some kind of lead mix. And so it's important to analyze that on a, on a source basis. Let's assume you're using lead aggregators and you are using direct mail and you are doing shows. And events, which, by the way, I separate because those are two varied— even though they're the same, if you will, they're very different in terms of the cost of what you generate from those. And maybe you're doing some canvassing. By the way, the one thing almost nobody does well is follow up on old leads. And they'll say, oh, we follow up on our leads. I'm going to tell you something that we have learned in the last few years that's mind-blowing. And that is that almost nobody follows up leads well after about 90 days. Well, if you are doing this properly, you're getting permission to call these people on the, on the forever. And if you have people who can politely and mannerly stay in touch with these people, there are lead sources that cost you more, but generate a lot of leads that, that you can convert later. And so, but a monthly looking at how many came in from a source and then having a legitimate number to what you spent that month, going back to my example of the direct mail piece. That I spent the money in March, but I'm sending those leads out in May. And so unless you take that cost and put it against the sales that you have, you don't have a realistic look at how well you're doing with that lead source. It becomes very difficult. The average person that shutters a canvassing department, as an example, is shuttering one after 6 months or a year because it took them that long. So in the case of events and, and those items, one of the ways to look at this is, is by breaking the cost down. And we developed something years ago called HPD, hours per demo. And that becomes important because the people that fulfill those functions, whether they be event people, canvassing people, or phone people, are working different numbers of hours. And so how do you compare the results? Well, the answer is the only thing they have in common is that they are paid by the hour. Break it down by the hour. In those areas, you can look at those every single week. Here's what I paid. Here's how many demos I got. Here's my cost per demo. Here's— and if you know the hours, which is a simple payroll function, then you know what your hours per demo are. And then you create what I'm going to call a model, which is your forecast, your goal, which is the big, hairy, audacious goal you'd like to go to that's still realistic. And the third one would be a minimum standard. Below what number am I not profitable and I can't keep this person no matter how much I love them. So that's one. So by each of these sources, you're tracking the cost that month. And then, you know, across this Excel spreadsheet, which is what I use for something like that, what did it cost me? How many did I need? What is my raw lead cost? And then looking at the conversion of raw leads to sets, what is my cost per set? And then looking at sets to demos, what is my cost to demo? And then it's easier to see what you're losing at all these areas? And then what do I convert to a net sale? And that's where we look at things like a cost, I mean, net sales per lead issued. Cost per lead issued is another serious one, but you need budgets for these based on what your conversion rate is. And so the truth is, if you're running your business well and you know the cost per lead issued and the net sales per lead issued every week, that's one way to stay up on top of that number before your profit and loss statement tells you 6 months later. And to, to identify when you have a problem, when it's a little bit more easier to figure out how do I resolve that problem rather than 5 months later where you're, you know, you're losing your mind and you say, where do I start to fix this? And before you have to pay money to bring somebody in to help you fix it is do, do put things into smaller pieces. Old big professional speaker buddies who like my dad is still out there. And he said, you can eat an elephant if you do it in small bites. His name's Joel Weldon, by the way. And so he doesn't work in this business, but he's a brilliant man. And, but he's, but he's right. That's how you do it.

But that's how you do it. And you got to do this because you have to understand, you know, what is costing me money and, and what is not profitable. You know, once you get up into the 50, 60% lead cost, is it profitable? Could be because of the blend. Like if it's TV and you got a 50% lead cost, but boy, when you run TV now, all of a sudden it lifts everything else and you see a whole bunch of new internet leads coming in. Now you got to look at the, the mix, the blend. I think you alluded to that earlier is you got to also look at the blend and see, okay, is my blend within my budgeted amount, you know, what I thought I was going to have to spend in order to generate the number of leads I need to, to generate.

Working with a fairly small contractor right now because someone that worked for a client brought me in to help. And, but he's getting some advice from a, a person I don't know, a marketing advice. But the truth is he had this small contractor in television when he had no right to be in television. And so you, you're bringing up an, you have to be large enough to absorb a bad cost, like a TV cost. And so I think it's fair to say that a lot of the larger organizations who still do a lot of newspaper and television and stuff, but those are running up around 20 and even up to 22, 25%. They generate a revenue though. You know, people say you make it up with sales, and thank you for saying what you said, because you really don't. But when you are a $5 million company, you've grown to a $30 million company, you can contain some of your overhead costs and absorb another 2 or 3% from someplace. But unless you're looking at your numbers all the time, that's just wishful thinking. It's like listening to a motivational speaker that tells you that you're capable of doing something that you're not knowledgeable enough or experienced enough to do. And so that's where all that stuff starts. It doesn't start with just making this big goal and saying, I'm going to do it. You know, all of this stuff requires experience, knowledge, know-how, and a plan. All of those things are a piece of making this work. And so what happens when you don't have systems is you're constantly trying to figure things out when, if you put the right systems in, the problems will be more evident to you very quickly, and you can, you can resolve them before they eat you alive.

You said something scary there. Marketing advice. There's so much marketing advice out there. I, you know, as a mark— as a marketing guy, you know, I'm smart enough to know that if I give anybody any information on marketing, I say you got to go test it. Just because it worked somewhere else doesn't mean it's going to work over here. The people you got to worry about are the ones that say, oh yeah, this is going to work. You have to do this, this is going to work. No, there's no guarantee that this is going to work. The only way you know it's going to work is by having the systems behind it, by understanding the costs, by understanding how many raw inquiries came in, how many of those demoed, how many of those converted. And then, like you said earlier, is how much of a tail do we have?

Are we just—

if the lead doesn't set an appointment, is that it? Are we done with it? Do it just sit in the database never to be talked to again? That's dumb. We paid for that. Let's keep trying and keep trying and keep trying and keep trying because rehashing leads that didn't buy, we on our, you know, dumb little G4 marketing system, we get 10% of people's revenue, overall revenue from a little rehash program.

You hit the nail on the head. One of the problems with these industry programs, and I have to, I hope I'm not stepping on toes and actually Maybe it's good that I'm stepping on some. I hear that a lot.

Let's do it. That's what we're here for. We're here to help.

We're going out into the industry and we're going to, we're going to assess all the best of the best. We're going to bring those ideas in and we're going to adapt the best of those. And of course, I've heard that so much, just gives me an upset stomach. So the reason is if you're not doing well and you go out and hear what somebody else is doing, how would you know it's the best? And unfortunately, people will give you statistics and those statistics, and I mean this with a heart, they aren't always true. Sometimes it's because someone's giving you statistics from a very short period of time. It isn't a valid data analysis. You know, they tried something new. It worked for the first month. Everyone was excited. And 4 months later, it's not working. And, and, and, but also people keep numbers on a false basis. So I'm going to give you an example. I get brought in by a company to help improve a very large canvassing organization, had several teams. And this person was speaking at an event with me, the owner, and told everyone what his cost of marketing was. Well, when I got into the business, I found out that wasn't his real cost of marketing. And the reason was his accountant had put all of his canvassing vans in with all the service vans. All the trucks were in one place in the profit and loss statement. Therefore, they weren't being counted. Can you imagine trying to assess a company that has 5 or 6 teams? We're talking about the cost, not just of buying 5 or 6 vehicles, but gas and maintenance and all the things that went with them. None of those things, none of the gear for those people, that was all under uniforms in the profit and loss statement, but they weren't calculated into the cost of the leads when they were trying to assess the leads. Granted, I was able to go in and help them. To me, the scary part is this person was speaking and, if you will, advertising, this is what my numbers were when they didn't even know.

No, but they were convinced that they were right. And by the way, what David just, just said is when you hear us talk about fully loaded marketing costs, that's it right there. He just gave a great example and accountants and bookkeepers will do this. They'll take the uniforms that your canvas teams are using and they'll put them under uniforms. And you have no idea now to judge. The van is a big one because each of those, I mean, the thousands of dollars per month it would take to run those things would definitely have an impact on the cost per, per lead and what that overall campaign costs. Let's go into now the next step, which is sales. Um, it's my contention, David, and correct me if I'm wrong, the core of this business is sales. We're direct selling organizations. If you don't have a great selling system that produces consistent results, how do you then feel good about making the investment in marketing to feed that selling system. And so I, I don't know if you agree. I think that the production is probably the easiest part of this business. The hardest part of this business is marketing. The critical piece of this business is the selling system. This is where you've done how much work in this area, but what makes good selling systems in this business? And what do you say to people that may or may not understand that This is a sales-based system. It's a direct selling organization that just happens to sell windows, one-day bath, kitchens, whatever it is.

I don't think installing it is the easiest. I think if, if your intention is to make sure it's installed well, the customer got what they, they want to deserve. But as your businesses grow, and by the way, some of the people listening to this have too many products for the amount of revenue they're doing, and they've come complicated their installations, and they're, they're probably less efficient at them. The more things you have to know, the harder. I can't tell you how many companies we've moved from 3 products to 2 or to 1, and who not only made more profit but could increase their sales by focusing. There's this belief that the more things I sell, okay. So I will say to you that today, of course, the problem for me is I have some very large clients today. I don't, you know, installing some of this stuff is very difficult. Especially if you're in a business, let's just say like the window business where the difference from roofing or where people can do a fewer amount. And so where they get into trouble, they are making a paper profit on selling 5 windows, but you can't make an installation profit easier unless you take the inefficiencies of an average 5-window job or a 6-window job and add that to your price. Now, eventually, you know, you're, so you're saying, I, I'm not, profitably installing these, I'll make up for it in my pricing. And if you can get away with it, that's fine. But a lot of times it just, it makes, it bloats your price, but it also makes you too comfortable with the inefficiency. But going back to your selling procedures, this is fascinating because most of the systems out there, and I don't want to make it sound like I'm being critical because I have a lot of friends who do this. Too many of the selling systems are taught by here's what we say and here's what we do without enough understanding of how do people buy in this business? What is their process? And so all of my selling systems, the steps are based on the customer's decision-making process. So too many of the salespeople, I'll give you a perfect example. We teach them the script of how to sell the product and here's how to close. Okay. If you simplify sales training, I think we complicate it too much for salespeople. It's really based on 4 things. Trust, credibility, urgency, and rapport. Meaning, does the person believe you're telling them the truth and will they answer your questions honestly because they don't believe you'll take advantage of them? That's trust. If you can gain their trust, you can tell them almost anything. I'm not suggesting you take advantage of them or lie to them, but that's the power you have when someone trusts you. Credibility. Do they think you know what you're talking about? Are you really an expert? And we do some things that get in the way. I'm gonna come back to that one. The third thing is there's no motion without emotion. So, this urgency has to be built. The average person has made this decision. It's better to wait than it is to do something. If you understand this statistic, it's mind-blowing. It's 70% of what I'm gonna call the more qualified leads, media leads. 70% of the people that don't buy from the average high-end contractor Don't buy from anybody in 12 months. And so, but contractors think that they have these competitors out there and that your biggest competitor is that customer doing nothing. Now, how do we know that? We know that from having valid statistics, from staying in touch with people, from doing rehash, that the average person has not made the decision because indecision is a no decision. And so what is the most important part of the methodology? Well, the answer is it's always the step you're on because if you proceed to the next step and you haven't finish this step, you're in trouble. The average contractor, in my opinion, does not conduct a professional inspection, one that meets the needs of the owners. And so your sales reps, this is the part where the person gets to talk more. It's harder for them because they have trouble controlling what's happening in front of them. So they want to move to the demo, the demo and the close where they know every little thing and they've been scripted what what to say and what to do. And where they're weakest is the inspection. Now, several incredible things happen during the inspection when you learn how to do this. First of all, you develop trust, credibility, and urgency and rapport. Rapport not meaning they like you. Rapport meaning that they believe you understand them and you care. If you can obtain those before the sales presentation, you'll close probably two-thirds of those presentations. So what is the main reason? It wasn't— you didn't lose it because of price. You didn't lose it. You lost it because you didn't have trust, credibility, urgency, and rapport. And you got to the end, you said all the right things. And so you walked away saying it was about price. If you handle the inspection process more efficiently, something else happens. And that is that the average person selling in the home gets the main objection, the main reason they're not going to get it at the end with the final price they're leading with people. And if you do this properly, you can obtain the main reasons they're going to tell you at the end in the first 20, 25 minutes. It takes a little bit of patience, takes a little bit of time, but it takes asking the right questions and them believing they can give you the answers. So what are some of those things at the end? We don't have the money. And, and so, of course they don't have the money. Most of the people don't have the money. If they did, they, they, they didn't save it for whatever it is that we're selling for the most part. So you say, well, we teach our guys to self-finance. Well, but then you have this argument that it's going to cost more with that. Well, the answer is I want to be able to address that early. I want to be able to make that because I don't want to fight that at the end. It's harder at the end. Another one would be that the average person doesn't know how long they're going to stay in that home. They don't. And so you are always dealing with this. If I spend this money and I stay here this amount of time, I'm not going to get my money back. That's return on investment. I want to get— I want to get— so later on they're going to hit you with that. And now you're going to be trying to handle this objection after you've been in the house for an hour or two. And another one might be, let's face it, 75%, maybe 85% of all the sales in the specialty home remodeling business, there are two owners to that house. Some of them are married couples and some of them have a different kind of relationship. Could be as much as a father and a daughter or, you know, two people of the same sex. For now, it doesn't matter. Two people own the house and they have different agendas. And so, you know, one of them has your product at the top, another one has it below. And I identify those, another long answer here, I apologize, as the ally and the antagonist. That means that the antagonist is going to be trying to undermine you. It's not personal because they have something else they want to do. And so they're fighting their spouse through you. I learned, by the way, I didn't learn this from any sales trainers. I learned this from marriage counseling. I learned how marriage counselors work to get two people to talk to each other because that's the goal. And so I learned how to, in the initial visit, get these two people to talk to each other in front of me. I'm going to make you a promise, Brian. When you get to the end of here, We want to think this over. Most of the time, most of the time, that means we want to discuss this without you sitting in front of us. It doesn't mean they're going to think it over. All right. And so we, we try to deal with, I want to think it over. If I can get them comfortable talking to each other. In front of me earlier in the conversation, then when I get to the end and we have to talk about the amount of money this is and how do we defer that investment over a long period of time using a financing program, is this a good deal or not a good deal in terms of return on investment? And where does this sit with these other projects you have around the house? So not only will they give me meat early on that I can use to help me make this sale, I have them comfortable with telling me the truth at the end. Again, this is a A long answer, but, uh, but it's, it's brilliant.

I mean, it's, thank you. It's game changer.

Yes.

Give us one or two ways that you get them comfortable talking about the project together in front of you.

How do you do that? Here's the gist of this problem. The average person thinks that the goal when they walk on the house is to get a sale. And my suggestion is that's not my goal. That's the result. My first goal is develop trust, credibility, urgency, and rapport. And I don't care how long that takes. It might take me an hour. It might take me 15 minutes. Here's the number one reason. If you tell someone you're going to conduct an inspection of their property and evaluate their situation, To do that, you cannot sell because if you begin to sell, you now have not told the truth. There are 6 words, 6 words that people are using during the inspection that I coach never to use them. Those 6 words are the number 1 used word in the English language, which is I, me, my, we, ours, and us. And so I, I earned a reputation, not just in this business, but this was my signature move on stage, was to play a game with people for money and prove to them, after I show you how to do this, you can't do it. And the reason they can't do it is because the human element, your human element takes over. So it, it requires training, it requires coaching, and it requires some discipline. But it also requires, when I'm in the house, I am always working with a printed questionnaire. Most of the people I create them for stop using them. Salespeople want to take the easy way out. It's easier to go in and talk about it. They think it makes them, you know, look less. Oh my gosh. I mean, that's such a false, insane belief. So, how do you spend 20, 40, 60 minutes, whatever it takes, talking to people without saying I, me, my, we, ours, and us? First of all, you need great questions. And you need to have learned those questions. Now, if you write them out on a piece of paper and put them down, it makes you, You know, look manipulative. So I use a header for one of those questions. And so, you know, as an example, other projects that tells me, here's the question. Hey, Mr. and Mrs. Holmes, you know, before I provide any of my thoughts, ideas, or recommendations to you, it really helps everyone I meet with has other projects that they're considering doing around the house. So, before I do that, tell me, what else are you in the planning stages of? I didn't say, is there something else? I laid it out for them first that for you to get the most out of me, it really helps me to understand what else you're working on. Now, people will tell me that won't work, it won't do it. And that's because they don't know how or they're scared to try it. So, or maybe they did it once and it didn't work for them. Ergo, that doesn't work, you know, research on, you know, one house or one customer. I promise you that that's just one of them. So, you do that. But the second thing, people will suck you into a sales presentation if you're not careful. A perfect example, you're, I'm in the house and we're talking about a roof. And we're, you know, I'm going through my investigation of the roof with them and one of them stops me because there's a problem we've identified. You know, let's just assume the roof's rippled. Maybe there's a problem with the sheathing underneath it. And they'll say, well, wait a minute, how would you fix that problem? And so the salesperson says, well, let me tell you how we do that. And they start selling. Every business that I've ever been in, business to business, business to consumer, the same thing happens. And the salesperson starts to sell right then and there. So someone says, well, how do you avoid answering the question? Oh, okay. First of all, if your samples are in the car still and your pictures are still in the car, even though they might actually be on your iPad, I might say something like this. I'd say, well, that's not a simple answer. And truthfully, it's much easier to show you this with some pictures. Now, I have samples and I have pictures. May I make a suggestion? I'm getting permission. And they say yes. I'd say, let's finish this part. I'll get the samples, I'll get the pictures, and I can show you exactly how this is done. And then you can decide if that's what you want me to do. Now, another way to do it might be to say, well, there's 2 or 3 ways to do that. Notice I didn't say here's how we do it. And in the industry, there are 2 or 3 ways to do that. You might do this way, this way, or this way. And they say, well, I don't think I like those 2 ways. Well, glad to hear that. That probably wouldn't how I would like to proceed. But before we go there, I have pictures of this. Again, you refer back that you have this man make a suggestion. And when they bring this stuff in, it's going to be a lot easier for you to see this and then be easier for you to decide if it's which way you want to go with that. Are you comfortable with that? They always say yes, assuming you're not boring. So I, me, my, we, ours, and us, trying to teach and coach your people that during the inspection process, any reference to yourself, Now means you are selling. If you are selling, you're not doing what you told them that you were going to do, which is to conduct a real professional examination.

You know what's funny is, as you said that, the 6 words, those are the exact same 6 words that I don't want to see in anybody's marketing. How much do you see in marketing, in ads? We are this, that we do this. And it's like, it is the worst because it's now, it's not, it's never about us. It's always about them.

Them.

And people forget that it's about them and the customer. It's not about us. And the more we make it about us, the less likely it is, A, an ad is going to produce a lead, and B, that you're going to actually be able to convert somebody into a sale in the house. So that's really good. I'm glad you brought that up.

If your whole idea is just to role play with people, they want to move to the part that's easier for them to do, which is the scripted demo, which is the scripted close. So, What I, and just a simple exercise for your thousands of listeners, Brian, is when you role play this, detail the house before you do it. So in other words, the house was built in this year. Uh, here's what the original roof was. Here's what the original roof is, or here's how many layers. Detail the house that you're in first. And, and don't make them make that up because they get confused while they're doing it. So create a scenario, if you will, a hypothetical situation. And by the way, don't make weird ones. Make it typical of what they go out and, and see. You know, if, if you're in Phoenix, Arizona, you're seeing a lot of single-pane aluminum windows. If you're in Columbus, Ohio, you don't see any single-pane aluminum windows. So use, you know, use the products that they're going to see, situations they're going to see. Teach them something they're going to see realistically first. Say, this is the house, and then make them use that data to do it because what you're after is teaching your people conversational skills and to know what those best steps are. This is where two wonderful things come out. One is this intuitional conversational skill that once, once you have the science down of how to conduct an investigation, you're actually going to become a better listener. Let the, you know, if you're fishing and that fish bites on the hook, first thing you do is let the fish run. Oh, not in this business. Second, that fish bites on the hook. Oh, we got a closing question. Boom. They, you know, they start to reel them in and now they're just fighting instead of letting that come. And I don't mean this to sound like we're just manipulating people because in truth, all sales is somewhat manipulative because you're trying to put a picture into someone's mind. Here's the secret. If you are using your skills to take advantage of people versus using your skills to serve people, big difference. So a lot of us are taught tricks in this business, and I was taught a lot of them when I was young, and they made me uncomfortable. I couldn't sleep well at night. So I, how do I build an authentic process where I can tell the truth at the risk of losing the deal?

Right?

Because in the end, that customer should think this was a wise process. If all you're working about, worried about is making a sale and making a profit. Now look, I want to do both. I want my customer to love me and I want to make a lot of money. And so that's not as easy as it sounds. But most of us aren't willing to enact the disciplines that we need to do that. And so the people that are make more money, have happier people working for them, have happier customers, and they sleep better at night.

You've dealt with wonderful people. You've dealt— I'm sure you've dealt with a lot of scumbags in this business that you probably fired. For the most part, what I've seen in this business are just good, honorable, decent people that are just trying to make a, a good life for themselves and for their families and for their people. But a lot of them, even though they're good and honorable and decent people, they just have such a hard time making this business work. What separates the two? What is— I'm always like so curious about the mindsets behind it. Like, what have you seen? What have you known?

You bring up one of my favorite lines. It's a hard way to make an easy living. This is a hard business. And, you know, unfortunately, the mindset of most salespeople is that easier is better. And since most of the businesses that grow in this business are grown by people who have a sales mentality, they continue to think like salespeople in their business. Now, don't get me wrong, you have to understand sales. You have to be able to think about sales, but you can't make decisions like a salesperson because those are generally based on what is easier. That's why they skip the steps. They go, They're in a house, they close a deal not following the steps, and they say, wow, all that other stuff is a waste of time. You can get away with things easily. You know, this is a, again, you're asking because my clients vary across the board. However, I will, I will tell you this. A lot of it is borne by this focus on doing the right thing, even when no one's looking. Shakespeare said, conscience doth make cowards of us all. Actually, it wasn't Shakespeare. It was Hamlet as he's deciding whether he's going to kill himself. And so, for me, there was no money that made me sleep better at night if I was using a trick or something or took advantage of somebody to get 20% more for a job just because I could do it. You just need clarity on how you're going to run your business. And that's a discipline. That means you have to be willing to lose business. You have to be willing to lose it. And you have to be willing to lose it by, A, telling the truth. It doesn't mean you go to a house and say, I think your roof will last another 20 years. It means telling the people the truth about it and letting them make decisions. I've had people buy stuff from me. I still don't understand what got them to buy, but it was their house and their money and their decision. It was what they wanted to do. I mean, I still remember back in the early '70s being at a brick home and he wanted to put siding on it. And I wanted, you know, I, I've lived in brick houses since 1981. I'm, you know, he wanted me to do this. I wanted to shoot myself. And I kept saying to him, well, have you talked to sandblasters? Have you talked to water blasters? Because he had thick paint on this house. And so in the end, this guy made the decision to buy. I like, I didn't want to do the job, but that was the man's decision. And I gave him every opportunity to take another avenue. So, I think there are people that are very clear on their values. That's not always easy to do and how you want to run your business and what kind of people you want on your team. I can't tell you how many of my clients have had a salesperson that had better results than anyone else who was doing things they didn't want them to do, and they infected the rest of the sales force. I will tell you this. That most of the people I've seen become successful love helping other people become more successful. And so I'm going to, I'm going to drop a name here. One of my nephews was moving to Wisconsin for a couple of years and he was, had a possibility to go into sales. So I called Brian Gottlieb on the phone because I know something about Brian Gottlieb. Brian Gottlieb loves taking young people and molding them and changing their lives. And I called Brian, who was thrilled that I trusted him with my nephew. And my nephew worked for him and the transformation of my nephew today, I'm not going to tell you how much he's making, but he is 25 years old and he's making a lot more money than his dad. And so the people that, that, that love doing that build better teams because their lives are important to them. Now, don't get me wrong. I'm competitive. And so I think most of us are. The competition doesn't mean beating everybody else. You know, I'm in competition against the problem. By the way, same thing happens in the house. I'm trying to teach salespeople that customer isn't your problem. The customer and you should be on the same side of the table. The enemy is the problem and your job is to help them fix it. And so, So I think there's gotta be clarity on who's the enemy. I think the most successful people that I have met in general look at their money on a regular basis. They do the things that we're talking about and have set a standard of behavior in their business too, so that people that can't follow that, they don't have to wink just because this is my best person. I learned this at an early age. My best salesperson was destroying my sales force. And I never built, this is when I was originally a sales manager back in the '70s. I never built that business until I let that person go. And they were infecting these people behind the backs. And the reason I believe in the end was he wanted the job and I got it. And so he, you know, he maybe didn't wake up every day and thinking, hell, can I destroy David Yoho? You know, but Part of his modus operandi was to prove that he was really, uh, the straw that stirred the drink. And so to use Reggie Jackson's phrase, every person that works for you needs a private time with you, if not every week, every two weeks, no more than every two weeks. And that meeting has to be sacred. You can't say, well, I got this to do or that to do. It's got to be sacred. Now, if you're going to take a vacation, there's not one scheduled for that week. But one-on-ones are critical for a couple of reasons. And this is one of the reasons that riding along with your salespeople, going out to the events, walking with them on the street, sitting with them in your call center. These are important because you're not only monitoring, this gives you a chance to talk to people about their lives. And once the people that work for you believe that they really matter to you and that you care about it, doesn't mean that you'll loan them money when, when you need it. But once they believe that, they will, they will go to the ends of the earth for you. And everybody's always talking about, oh, you can't find good people. Nobody wants to work anymore. Look, there's a lot of that out there, but that's always been that way. They were saying the same thing when I was a kid. And one of the reasons I was successful and one of the things that I'm looking for other people is who's willing to do whatever it takes. Who's willing to do whatever it takes? And there aren't as many people out there like that. But once, once people see that in you, they learn from it. Part of my growth in that area is another story for another day, but it would be a thrill to come back another time, Brian.

I'll tell you what, that was incredible advice. We've talked about a lot of stuff, but we hopefully come back again and we have another conversation because there's so much more that we could, we could talk about. But this was pretty meaty, pretty meaty. We talked marketing, we talked sales, we talked behaviors, all good stuff.

Brian, first of all, you and I go back a long way. I admire what you've done in this business. Seeing that you have Ted Lasso and Rocky Balboa behind you, just, uh, listen, I love what you're doing. I, I'm at a point in my life where I can't touch all of these contractors and I love doing them through your venue here because this has been a thrill for me in this business. I know what this business has done for me and I like other people to do it. Now, I still need to make money. I have a young wife and so she's going to be alive another 30, 35 years, and I have to make sure that she and her next husband are very comfortable.

Well, I think if, if your father is any indication, I think you'll be around a long, long, long, long time. Thank you. I appreciate you. And hey, if people want to— do you want people to get a hold of you?

I love it. Yes. DavidYoho.com is my website. 502-552-8136 is a direct line into me. I'm always willing to answer questions, davidyoho@davidyoho.com is an email. Okay. And so, yes, I love, I love to hear from people. I listen, you asked about success. For me, a big part of that success has always been when I was traveling 42 weeks of the year, 6 of the other weeks, 4 at the minimum were spent traveling someplace. And so that, that to me is a big deal. And I will tell you how much money I give away. Become seriously important to me. And I hope, I hope everyone listening to this understands that that's all of our job. All of our jobs to take care of other people. You just have to find the right venues to do it. And if you can do, you know, anyway, that's enough said.

All right. Well, thank you, sir. I appreciate you. And definitely you got to come back. My pleasure.

All right.

All right, everybody. Well, look. Another great episode, I think, of the Wealthy Contractor Podcast. This is Brian Kaskavalciyan, and until next time, thank you.