You Can Build This $1M+ Business With No Tools and No Crew ⏐ Ep. #214

Using the subcontractor model, you can make over a million dollars a year of net profit.

Yes, you can. The fastest way start making some good healthy profits is to subcontract it.

The installation machine and all that. You don't even need to own that.

No, they have their own equipment. It's a 30 minute install, but you can sell those for $1200. If we focus just on every home selling airstrubber, we could sell a million a year.

Okay, now we're talking.

There's a lot of money in ductwork. If you're towing the water with duck painting and it could branch into something where now you're looking at $10,000 tickets. Our average ticket is right around 10 grand.

You're kind of selling fear a little bit, right?

Yeah, it's energy savings, comfort and indoor air quality all together.

All right, you asked and I answered. Every month or so I email out a poll to my newsletter with about 30 different niche business ideas, opportunities, etc. And I ask you guys what should I dive deep on? What do you want to learn about? And over and over you kept voting on vent cleaning, insulation, duct work. I don't know why, but you guys wanted it and so I brought it. I have a friend named Rex. He lives in Phoenix and he has a seven figure insulation slash vent cleaning slash home performance as he calls it business. And if you liked my forestry mulching episode a month or two ago, you, you're gonna like this. Cause it's just as tactical but a different vertical. What's his Facebook ad strategy? How much does it cost to generate a lead? What types of markets do these businesses work best in? How to find subcontractors in unique places to do all the hard work for you. What your offer should be, how you should charge, what angles you can take within the home performance industry to start a business that doesn't cost all that much money. This episode is jam packed with all that stuff. Please enjoy and share with a friend. Is insulation your big kind of money maker?

So insulation removal and then obviously re insulating. I mean we're both those services. We're at over a million on, on the year. And then duct aero seal, duct sealing is our third biggest. So but naturally we're going to get up in the attic, we're going to see how old their AC unit is and then that's when we'll come down and sometimes offer a new AC unit.

Are using like tools to see if like cool air is leaking out in the attic and like infrared stuff.

Yep. So all of our sales rep have the infrared cameras.

And I love stuff like that because it's. It provides such a perfect visual. And you're like, listen, don't listen to me. Just look at the data. You know, show them the picture of, like, the glowing red and yellow, and they're like, oh, my. They just see, like, their money, like, burning up.

Yeah, Right. So we do all. Every single one of our sales guys has an infrared. Even our, you know, project managers and stuff have that. We'll have them turn on the AC unit right when we get there, or the heater, depending on the time of year. And then we'll go get some images of the duct work. We'll even pull aside some insulation and we'll see through, like, their cam lights and some of the areas that they're leaking in their attic. We'll show them the thermal imaging of that as well.

Okay.

So they can actually see like, the cold air coming up through their house. Right. Or the heat coming up through their house into their attic. So help people understand how their house is leaky and how we can grow up nice and tight and save them.

Okay, so what does, like, an average prescription look like? You go in there, you go to an average addict. Not too crazy either direction. What do you prescribe them? What does it cost them? What does your margin look like on something like that?

When we go to a home, the most common thing that we do and we push it right, is removing all their insulation so that we can seal the attic. Right. So we'll come and fill up all the leaking areas of the. The attic. Once we have all the insulation removed, we're going to add R49, which is about 17 inches of insulation.

Okay. And what do people usually have? How much of an upgrade is that typically?

So here in Phoenix, it's the average home probably has six inches of insulation. Pretty much every house here has old cellulose insulation, which is like made of cardboard and newspaper. That stuff gets. Breaks down. So they, when they process that insulation, they have to add fire retardant to it. And especially here in Phoenix, that. That fire retardant, like, activates with the heat. It starts basically disintegrating the insulation and settling. And so you'll get up in attics, it's super dusty. It's. It's gross. Yeah, Active. So we'll remove all of that. We'll seal up their attic, we'll add a lot more insulation than what they had. And then a lot of homes. Almost every ticket that we sell has some sort of duct sealing. Most, most of what we do is aero seal. You've heard of aerosol, right?

I haven't, no.

So aero seal is, it's cool. It's a technology that you block off all the registers in the house and then you, you hook up this machine to the ductwork and this machine turns this sealant into like an aerosol. And so you're basically, you're pressurizing the system. All the ducts, all the vents are blocked off. You're pressurizing the system. And so when you're sending that sealant through the duct, ductwork, it's not coating the ductwork at all, but it's that those little air sealant particles are traveling through the air and they're going out the holes and they start accumulating at the holes and sealing up the duct.

Interesting.

So it's the best way to seal ductwork. It's, it's a lot more expensive than sealing it by hand. It's going to get all the cracks and holes and even the, the little holes that you can't see.

It kind of reminds me of like the fix a flat. Right. You spray it in your tire and it just.

Yep. 100.

Interesting.

Yeah. So that's kind of the, A lot of people relate to the fix a flat concept or. Yeah, they have a certain product like that to seal up a radiator. So a lot of people relate with it that way. They go, okay, so that's like the.

More expensive version of like manually, like taping, but it's more effective as well, correct?

Yeah. And we, and we really build a lot of value in Aerosil. In fact, Aerosil consults with us a lot because we, we're kind of one of the only companies that's been able to figure out because, because a lot of people that sell Aerosil, it's kind of an add on service to what they're already doing. Like, and I guess that's. We kind of do that too, but, but we, we'll go sell a. On its own.

It's like a main course for you guys. Most people treat it like a side dish or an appetizer.

Correct. So Aero still likes to, to pick up rain a lot on how, how we're actually selling aerosol alone because a lot of the companies that sell it don't know how to do that right now.

So you go into an average house and what do you usually quote them for? Just an average job.

Our average ticket is right around ten grand.

Okay, what size house might that be? 3,000 square feet.

The average home is probably about 2,000 square feet. Usually that includes removing insulation, sealing up the attic, adding R49 insulation, and then sealing the ductwork. And a lot of times they'll include a duct cleaning as well because we package that with aero seal. So 10 grands are cash value because we use a lot of financing and financing has fees and that added to it. And so we strip that out and we want the true cash value of that job. With the fees, we're probably closer to 11 grand.

Okay. I gotta think that taking all that insulation out is just a pain use like a massive vacuum. Yeah, just a big, like just like this big around.

And it's a. Yeah, I mean you're looking at a six inch hose. At least six, eight inch hose. And you know the one we're using right now is a diesel vacuum. It's got tons of horsepower. I can't remember how much, but. But yeah, I just. You just go start sucking it out.

Yeah. Do you have to like dispose of it in a certain way or can you just toss it?

We just take it to the landfill. So.

Okay.

And there are some landfills that, you know, don't like to take it, but we know all the ones that will take it. And so yeah, when we end the job, we'll head over and dump it.

And are you replacing it with blown in insulation? Just like the snow white stuff?

Yep, that's what we. Okay, that's blown fiberglass. We can do spray foam. I have some. I have my own issues with spray foam. It's. It's a great insulation, but there's some downfalls to it too. And so most of what we sell is blown fiberglass.

So on a $10,000 job, how do the unit economics break down on your side? Like what are you allocating to overhead versus ad spend versus COGS labor and all that?

So 10% ad spend is kind of what we factor of our revenue. We want to keep at, you know, ad spend to about 10% or less commissions. Same thing. We pay about 10% and then overhead, we want to keep around 10% as well. So we have 50%. It's actually like 52% margins on all of our products. We want to keep 15 to 20% when it's all said and done.

So 52% gross margin. 15 plus ish net.

Yeah. Our target's 20, but we're satisfied with 15.

Yeah. Yeah, because you got to pay aero seal, you got to pay for the insulation, you got to pay labor. Your insurance probably isn't Probably a substantial substance.

Not cheap. Insurance is not cheap ever.

Yeah.

So you know, in, in sales commissions with overrides and everything, we're about 12% there. That's where the 52% margin comes in when we pay out all commissions. And then. Yeah, on a, on a really bad month with our ads we'll get 8 or 9x but on a good month we'll get 15.

Yeah, 15. You should put your net closer to 20.

Yeah, last month we were at 15x on our.

Nice. So what is like a big job, like a really good, profitable job look like for you?

We've done jobs as high as 30 grand.

Is it usually bigger homes or homes with more issues, more leaking?

A little bit of both. Right. So single level homes like your house, that's going to probably be a pretty big ticket because it's going to have a big attic. Right. So there's more square footage to, you know, two story homes, they don't have as big of attic. So there's not as much square footage to, to remove or to replace. Where we make it up with two story homes though is most of the time they have multiple AC units. So we'll get two, two duct seals out of it rather than one. So we'll make up a little bit of that on, on the two story. Some of our sales reps, they sell air scrubbers, they sell duct cleaning, they sell H vac unit, you know, and we'll get big tickets. I mean we've, yeah, we've, we've had jobs where we, they've needed everything and we, we've had jobs over 30 grand. 40 grand. Yeah, you know, those are, those are always fun jobs to, to do.

What are air scrubbers?

It's a simple install this. There's a lot of money that you can make in air scrubbers. So it's a device that goes. And you can install it on the supply side or the return side. So all your AC units have a supply side and has a return side. But it's just a little device that has like a cell that goes into it. And so as air is passing through it, it's basically ionizing or atomizing the air and it's charging all the, and as it comes out the ducts, it's goes and attaches to all the dust and pollen and allergens.

So it's like an, like an electronic air filter. Like a high powered air filter.

Yeah. And I mean it'll kill viruses, it'll kill mold, it'll kill. So but you just put it into the, into the plenum, sealed up really good and plug it in and it's, it's a 30 minute install, but you can sell those for $1200.

And what's your cost on that?

400 for the product and then $50 in labor.

Yeah. Dang. You just plug it into the wall. As long as there's an outlet up.

There, you can plug them into the wall. That's an option. Or you can just. They make these adapters that will plug into your. The actual area.

Wow. And on that one, that's kind of like a pest control sale. You're kind of selling fear a little bit.

Yeah. Well, especially with. With there's a lot of people out there that have asthma or, or they just bad allergies. And so a lot of that's coming from their attic and their duct work. So by putting one of those in there, it's gonna help a lot throughout their home. So I have two installed in my house.

How much business do you do of that per year? The air sealing air scrubber? We have air scrubber.

Yeah. We're at year to date, 56,000.

Dang. Okay. Is there, is there a business to be had of someone just doing that like that alone, Driven by Facebook ads, door to door, what have you?

I believe so, yes. Yeah. No, that's a big issue. A lot of people especially, I mean if there was a couple. If there was a good thing that came from COVID it's people's awareness. Awareness, allergens and viruses and things like that. There's a big health push in, in our culture. You know, a lot of it's fitness and food and toxins and stuff like that. And so that helps drive the need and the want and the desire for them.

Yeah.

Air scrubbers for us is kind of an afterthought. It's kind of a side dish, a little bit of an appetizer. If we focus just on every home selling air scrubber, we could sell a million a year.

Okay. Now we're talking about. I don't think people are going to start caring about toxins less. Right. I see that as only growing. Have you heard of those companies that come in and they'll like diagnose your home as far as like toxins are concerned? Like, they'll look at the air quality and then they'll give you like, they may charge you like a few hundred bucks and then they'll give you like a laundry list of things to fix. Do you work with companies like those? Do they refer business to you or is that still pretty early?

That's still pretty early. We haven't worked with any companies like that and I don't know, I don't know of any companies here in Phoenix that do that. I'm sure they're all.

Yeah. But I know a guy in the UK doing it really successfully.

Yeah, it's a big business. Just the air purification industry is several billion dollars a year. It's like $10 billion a year just in the U.S. so there's a lot of money to be made just focusing on air quality.

Can homeowners install those themselves? Like if they were handy enough or is it pretty technical?

Yeah, they definitely can install them themselves. So it's a simple install. If you have any sort of low voltage electrical knowledge and you know how to cut a hole and patch it up and seal it up nice and you can install yourself. So.

Okay.

And the nice thing about that business, just, just in the air scrubbers is there is a reoccurring revenue, you know, side of it. Because those cells that are in that air scrubber, they'll last two years, two, three years. So you can go and sell them a new cell.

Yeah.

Every two to three years.

You can sell them whatever you want. Every two to three years.

Exactly.

Right. You get your foot back in the door every two years.

Yeah. There is a good business. If. And I, I've thought about just starting a business that just focuses on duct work and air scrubber.

Yeah.

Going to be like a really. It was going to be one of the main courses of that business.

Yeah. All right, so for a 2,000 square foot home, 10 grand. What kind of monthly savings could the homeowner expect? Like what would their power bill go to, roughly.

So according to the Department of Energy, if we're doing like the whole package, they can expect 25 to 30%. But we've had homes where, I mean, the attics are just completely, I mean, no insulation or half their attic has zero insulation. Their ductworks disconnected. Those homes. We're gonna, are gonna completely transform their lives, right? Yeah, we love those homes because. Yeah, it's gonna make a massive difference. They're gonna fill it like this the next 10 minutes after it's done. But 25 to 30% on a typical home, on a lot of the older homes, you can get probably more of that. More than that.

Okay.

Yeah, we don't, we obviously we focus on energy savings. That's a, that's one of the benefits of doing this. But we look at it from a holistic. Hey, you Want to be more comfortable. You want to have even temperatures. This is your home. Invest in it. Live in your home. Be happy in your home. No one wants to have a home that has a room that they don't want to use because it's uncomfortable. So we're really focusing. And then the health aspects of it. So it's energy savings, comfort, and indoor air quality altogether. And that's the value that we're selling, right?

Yeah. It took me so long to flip that switch in my brain because I'm inherently cheap. And so I would keep the A.C. like, 77 in the summer. And then one day I was just like, what are you doing? This is miserable. You're gonna spend an extra 40 bucks a month to be comfortable. I think that's worth it.

Yeah. So when we first moved here to Phoenix, I tried to live that way the first year. And I told my wife, I was like, hey, if we're gonna stay here in Phoenix, I'm gonna pay whatever power bill I need to pay.

Yeah.

Just to be comfortable.

Yeah.

I don't care.

On a 2,000 square foot home. What's an average, like, summer power bill in Phoenix?

Four to $500.

Oh, so they could save 2, 200, 150, 200 bucks, right?

Yep.

So they'll get that money back in four to six years, give or take.

Yeah. There's a lot of tax rebates, and so, I mean, the tax credit's going away after this year, but a lot of utilities are doing rebates. So one of the utilities here in Phoenix is. It's called SRP. They get $400 just for duct sealing, and then they'll. They'll give $600 for insulation. And there's other little rebates they give as well, so we take advantage of those as well. So.

Yeah. All right. You know, I'm always talking about data, the numbers that actually matter because you need data to grow, and you need to grow to make real money. Beehive is the newsletter platform that I've used for over a year and a half. Because of their data? Well, for multiple reasons, but especially because of their data. Yes. Most platforms will tell you someone opened your email. Cool. But Beehive tells you everything. Engagement drop off, which links people ignore and which ones they click again and again. What keeps readers scrolling. You get real time subscriber insights, a B testing results, even predictive analytics measures. It's like having your entire subscriber base give you feedback live. And you can set up automated sequences, welcome emails, re engagement Campaigns, all based on that behavior. Because the truth is, if you can't measure it, you can't improve it. And Beehive shows you what's actually happening. So head to beehive.comchris for 30% off three months. That data will change how and what you write. If we were to look at two variables, like, if someone wanted to get into this industry, either vent cleaning or air quality or insulation, the two variables being, like, quickest path to good net cash flow per month and like, barrier to entry. If we were to take both of those into consideration, what opportunities in this space do you see for people?

I think it just depends on. On how you want to do things right. Because I remember when I first started this business, I wanted everything in house. I wanted to do everything in house. I wanted to have my own crews, I wanted the. The trucks. I wanted everything right. And obviously there's going to be a big investment because insulation machines are not cheap. If you want a good insulation machine, you're looking at 15 to 20 grand. That's just for one machine.

Can you finance them?

You can. You can.

Okay.

That reduces the barrier to entry. And then, you know, insulation removal machines, you're looking about 10 grand for one of those machines, for a good machine. And if you want to get into duct cleaning, you're looking at five to ten grand for a machine. So that's how I used to think. I wanted everything in the house, and I invested a lot into building all that. You know, we had over 100 employees or close to 100 employees, and we were doing everything in house. I've since changed my thought process. I've since changed, you know, the way I think and the fastest way in this business to cash flow and to start making some good, healthy profits is to subcontract it. You know, there's a lot of. There's a lot of small companies that need the work, that don't invest in that marketing, that are just basically labor, and that's all they want to be. And you find the right subcontractors, they'll do whatever you need them to do.

Where do you find them? Facebook Marketplace.

The best way to find really good subs is through the suppliers. Really how we found good subs is go, go utilize our connections with the suppliers. Because now we have, you know, someone that's has firsthand, you know, knowledge of how that sub is and the work they do and how much they're buying and just who they are as people. So that's where we've had our best Success.

Finding subcontractors, people selling you equipment and.

Yeah, yeah, okay. Selling the.

That's smart.

The insulation suppliers, Aerosil, you know, calling them and finding the best Aerosil companies, that's the best way. But we've found, we found several subcontractors just through Google and searching online for insulation companies. Or we've even found. We found one of them because we had a competing quote with one of our customers from them and we, we saw what they were charging them. We're like, geez, these guys, we'll pay.

You that, we'll pay you that and we'll take this job.

Exactly. So yeah, that's how we've traditionally found our subs.

It's funny because people think of starting like a home service business and they. Their mind immediately goes to, all right, I need to learn how to perform this service. I need to learn everything I can about our values and insulation and all this. When really it's like, you need to learn Facebook ads, right? Like, if you can just learn Facebook ads and you're going to be ahead of most of your competitors and they're not going to be your competitors, they're going to be your partners, you're going to pay them to do all the work for you, right?

Yeah. And I love it. Like, one thing that I always had a fear of quality, right? I always had a fear that if we sub it out, quality is going to go down. And we've had issues with subs and we don't, you know, we let them go or we don't send them any more work and we get it fixed. And you know, I'm not saying that every subcontractor has been awesome to work with, but we like the small local companies. We like to work with. You know, the owner's usually on the job site. He cares, he wants to continue to receive our business. They're going to do a great job and they're going to have great quality because they care about their business. They want more work from us. And so that's one of my switches that have changed in my brain is like quality to actually, you can make an argument that it goes up if you have the right subs. And then we always have a project manager. So we always have a project manager that's on site to deal with the homeowners. And so we're still managing the product. We're still very hands on. It's still our projects in the way we want to do it, but we just find people that already have the help and, and the labor and want the work and you know, that's, that's how we do it.

So are you pretty much subbing everything out today?

Pretty much. I mean we do some small things in house, but for the most part we sub it all out.

So on a ten thousand dollar job, how much of that goes to your sub on average?

Well, so we usually have our subs pay for the product too. That's kind of the changes we'll make in the future as we'll procure the materials. So about 50%.

Okay, 48%. It's just like, I mean that's the tree business. That's what we do. Yeah, we mark it up what, you know, 2x basically.

Exactly. Also, general liability goes down because you can, you know, require them to have general liability. So now you're, you're a different type of general liability that you have to carry. And so there are a lot of savings that, that come with subbing it out. Also another thing, if, if they step through the root or step through the ceiling, they're responsible for to fix it, not us. Right. If they have a machine that breaks down, they're responsible to fix that, not us. And so there was one point when we had everything in house where just on rental equipment we were spending 15 grand a month just because we had machines break it down or whatever.

Yeah.

So that's a savings that we have just by subbing things out.

So you don't even, you know, you talked about the, the insulation machine and all that. You don't even need to own that with the subcontractor model.

No, they have their own equipment. Now. Insulation subs are a little harder to find than like a landscaping subs or.

Yep. But more specialized.

It's more specialized. It's a higher investment up front. But they're out there and they want the work.

Yeah. Now a lot of people hesitate to hire subs because they're like, oh, they'll take my business or they'll show up in a different truck with a different logo. I explain like the homeowner 90% of the time doesn't notice or care. It's a non issue. Right. Because it's pretty commonplace. And what about like stealing your business? It, it does it just work for this? Because it's not really recurring thing. So you manage the payment.

So we have the project manager on site. And if, once again, if you have a good sub, I mean we, one of our, our main subcontractors, I mean we keep them super busy to where I. Yeah, 90 of their business is from us.

Yeah.

They're not going to do anything to mess that relationship up.

Yeah. You know, and it takes time to find them and to vet them. Right. It probably won't be the first sub you find that's that good.

Yeah. 100. Yeah. And. And, you know, we've had our bad ones, but for the most part, we haven't had any issues with that because we. We still control the project. I think where you have the issues is if you just, like, sub it out and don't have oversight. Right. We still want to control the communication. We're still there with the homeowner, walking them through the project. We're not just handing it off. And I think that works. There's a lot of big companies that just hand it off, but we don't want to do that. We like to have a little more control over it.

So what is, like, your project manager to job ratio? Like, how many jobs is your project manager overseeing at any given time?

Here in Phoenix, we do about 60 jobs a month. And we have one project manager, one of our subs. You know, the one I was just talking about? We trust him implicitly. So if. If that project manager is. Is out for that day or can't make it to the job, then we don't worry about it. And so there are those cases where, you know, calls him sick or is on vacation and, you know, we still are communicating with them, but we might not have a project manager on site that day.

Yeah. Okay. So it's not unreasonable to assume that in one metroplex, using the subcontractor model, with a good Facebook ad strategy, you can make over a million dollars a year of net profit. Right?

Yes, you can.

You got dialed in systems. You're paying your salespeople a commission. Facebook ads are cranking. What types of services are you selling with your ads today?

Most of our ads are targeted towards insulation and duct sealing. So we'll do like, a free attic inspection. So our ads is really just a pitch, A free attic inspection. Obviously, we're bringing up some of the pain points in our ads. You know, just kind of some of the things that people might be experiencing. That kind of elicits the. The response to get an attic inspection. And then we'll go do an inspection, and we'll come down after we inspect the attic and some of the things that are going on up there, we'll come down, sit down with them, present the solution. That's where we'll add on, you know, if they're having allergy issues or Dust issues. We'll add on air scrubbers or duct cleaning or you know sealing. Ductwork is big for allergies and dust. So that's where we kind of once we do the attic inspection. So really our ads are really just focused on providing a free attic inspection and once we do that then we kind of know the solution to tailor for that homeowner.

Okay, so that's been like your most successful ad offer is get your foot in the door with the free attic inspection, ask the right questions, feel them out and see what kind of direction you need to point them towards.

Right? Yep.

Okay. I assume you're using mostly video ads.

Yep. Usually my face in. So in an attic or somewhere talking about insulation and to know then they have good call to action. Have a good offer and you're going to get people submitting their information. Now you have once, once that happens you have to have the appointment setters and, and the automations in place. And that's not hard to set up. But you know, to keep everything organized and to make sure that things aren't falling through the cracks, that's an important element of doing.

What does your like tech stack look like? Are you using High Level or HubSpot?

We use, we use High Level know for our marketing, for our leads to come in. But I've been developing and I think you and I have talked about this before. I've been developing my own CRM for five years now.

Six years. Yeah. So how's that going?

It's good. I even have it connected with High Level. So all the leads are coming through High Level. Go through it.

Okay. So what about Ven Cleaning? Do you think there's. That could be a standalone business and if so how could people tackle that if they wanted to?

Metclean definitely can be a standalone business with Facebook ads. You want to have a big enough ticket to make it work. Yeah, I don't. You could be selling a cheap product or an expensive product. Your leads are going to cost roughly the same. We spend about each lead that that we get in is about $75 a lead. We need to sell a ticket. We need to sell something, a service that's going to recoup that investment plus put some money in our pocket. You'll probably have a higher close rate with it with a cheaper product. So you probably able to sell more duct cleanings. Your close rate would probably be a little better. But like a typical duct cleaning standard 2,000 square foot home, 12 vents. You're looking about 800 for that. Once you're in doing the duct cleaning, there's the additional services that you can upsell, like the air scrubber. Right. You can do some duck sealing. Right. You can even, even if you don't want to invest in the aerosill system, you can go and do manual duct sealing. Because one of the big reasons why dust is getting into the ducts in the first place is because of leaky ducts. Right. And so that could be an upsell is duct clean or duct sealing. You can charge four to $500 on that and then just other duct services. But that duct cleaning could be the kind of the lead horse. And then you can upgrade that, you know, that service from there. And that's kind of how we do.

I think there's a couple different words for this, but I've heard people call it like self liquidating ads in your case. Like you don't really make anything unless you close a lead. Right. Like you're offering a free attic inspection but you know that your close rate once you're insight is going to be x percent. But with this model it could be, you know, our offer is not a free attic inspection. It could be a duct cleaning for $800. That way like when you get your foot in the door, you physically get to their house, you've paid for the ads and then some. You're already profitable. But then you can bring your average ticket from 800 to 1800 because 1 in 4 people buy an air scrubber or 1 in 4 people get a $10,000 job. Right? Is that kind of what you're saying?

Yeah.

And it averages out.

Yeah. And then with, with duct cleaning, that's something you can sell over the phone. You don't even have to go and look at it. I mean a duct system is duct system. You ask their the right questions. You, you could sell that over the phone without even really going and seeing, you know, the, the property. So that's obviously there's some savings there. And as far as converting someone to a customer and then yeah, like you said, the self liquidating offer, you can, you can come up with this like really good offer on the front end to bank on some of the upsells. And then when you're in the house doing the service then you can, okay, we, we notice that you're ducts are super leaky or you have a disconnected duct, you have allergy issues. Let's sell you an air scrubber. And you know, there's a lot of things that you can do once you're there doing the service, once you've kind of sold them that you know, you've made your money back from the ads and that's you make the profit at all the upsells.

Is there enough margin with vent cleaning only to sub it all out or would you want to do it yourself? And if so, what kind of equipment would you need?

So vent cleaning, that's. If I was just to have a vent cleaning company, I'd have that in House 1, because you don't need a lot of, I mean depending on the type of duct cleaning you do. So there's a couple different types of equipment you can get. There's, there's what's called a, a brush and vac where basically it's just long brush and there's a vacuum attached to it and as you're scrubbing it, it's like spins around. You really only need one guy to do that. The downfall of the, the brush and back method is, you know, that's usually designed for residential and light commercial. So if you wanted to do anything bigger, you're kind of limited to just that, you know, part of the market. The other type of duct cleaning machines is it's a negative air machine. And that's where you're blocking off the AC unit. You're connecting the, the vacuum up of the air handler and then you use these like air whips to break.

Yep.

Break up the dust.

You see those in like the Tick Tock videos.

Yeah.

Because it's very visual.

Yeah, yeah, they're very visual. It's breaking up the dust and it's, you know, it's sucking it into that negative air machine. That is, in my opinion, it's a better duct cleaning method. But it's, you're probably going to have two guys to do that work and it's a little bit longer setup. But the, the upside is you can get into bigger jobs. You can do industrial duct work, really start to get into those types of jobs. So duct cleaning, I'm not saying you can't sub it out, but the average ticket is probably about 800 to $1,000.

There's not a lot of margin that.

Might be something that you're. You, you want to take in house. But so for a machine. So if you're just doing a brush and back machine, a good machine that's going to last and you know, know that's going to do a good job. You're, you're looking at about a $46,000 investment. Negative area 8 to 12, there's cheaper machines out There. And it might not be a bad idea to, to go a little bit cheaper to start, but you're going to probably have to upgrade, you know, later on where. Yeah, if you just kind of invest right up front into the better machines, those, those will last a good while and they'll do a good job for you.

So, yeah. Is this as good of an opportunity in colder climates or is it best in places like Phoenix?

I think anywhere where there's extreme weather, I mean, insulation's great in colder climates. In fact, usually the levels of insulation you want it, you want to install are higher. Right. Like. So, like in Minnesota, instead of going to R49, you'd want to probably install R60. Probably get a little bit more money on that ticket just being in the colder climates. But yeah, I think extreme weather is where you're going to get the real demand for it. In places like San Diego. There would still be a demand in San Diego, but it's the same temperature all year round for the most part. You're not going to have people suffering. I think the biggest thing is, like, the difference people feel from winter here versus summer. Right. Winter, they're pretty, you know, content. They're, you know, they're like, life's good. It feels good here. And then all of a sudden the summer comes and they, they start realizing, you know, all the areas that, you know, of their home that are not comfortable or they're not getting or whatever.

So with that logic, like, Phoenix might not even be the best market, right. Like maybe a Salt Lake or a Dallas that gets really hot, really cold.

We love Dallas because it has both extremes here in Phoenix, we still get a lot of winter work because we're, we're really selling the summer. Hey, do this now. So the summer's better. But in Dallas, you get a lot of pain in the winter and you get a lot of pain in the summer. Same with Salt Lake. Same with, you know. So, yeah, anywhere where you kind of have pretty hot summers and pretty cold winters, you're gonna, you know, business is gonna be good.

Yeah, but in Dallas, we get like nine days of perfect weather per year. So don't dog on it too much.

Yeah, I mean, Dallas is a great market. The only thing that sucks and we've had this happen in Dallas is all the ice storms where we can't do.

Anything.

Slide off the road.

Is there anything that's interesting about this business that I forgot to ask you about?

I don't think so. I think you asked some good questions. What I'll say is there's a lot of things that you can do in this business, in the home, I call it the home performance industry. And there's a lot of things that relate to others. I mean, you could at some point your business grow to do roofs. Because roofs, actually it's something that come up, comes up quite a bit with us. Hey, can you fix my roof while you're doing my attic? So there's a lot of areas you can branch into. Just starting off with whether it's insulation or duct cleaning. Like, you know, I mentioned earlier with duckling, you could eventually run a full blown duct business. And there's a lot of, you know, there's a lot of money in ductwork, replacing ductwork, you know, adding returns, you know, cleaning ductwork.

New builds.

Yeah, new builds. So you can kind of dip your toe in the water with duct cleaning and it could branch into to something where now you're looking at ten thousand dollar tickets, fifteen thousand, because ductwork is one. It's not cheap. Nobody wants to do it. And there's, there's a lot of intricacies with it. So you can really charge for it and be fair too. So that's kind of how I look at businesses. Like how can I get in at the, you know, the lowest barrier to entry and how can I grow into.

These upsell from there?

Yeah.

So, yeah, beautiful. What. Where can everyone find you, Rex, if they want to find you or your business or.

So our Instagram page is. Our handle is at Cozy Pros. Same with Facebook.

O, Z Y P R O S.

And my name's Rex Lindsey. They can find me on Instagram and Facebook.

Cool. Thanks, man.

Yeah, thank you.

All right, what'd you think? Please share it with a friend and we'll see you next time on the Kerner Office. Hey guys, if you're still listening to this, it's probably because you haven't had a chance to take your AirPods out. You're still mowing the lawn, you're still driving, what have you. If you're still here with me, I would really, really love and appreciate a five star review on Spotify, Apple or wherever you get your podcast. It would mean a lot. If you want to go the extra mile, share this episode with a friend that might have an interest in starting a business. It would mean a ton. Hope you have the best day of your life today.