Superhero Syndrome: Why You Can't Do It All Yourself

Welcome to the Profitable Painter Podcast. The mission of this podcast is simple: to help you navigate the financial and tax aspects of starting, running, and scaling a professional painting business. From the brushes and ladders to the spreadsheets and balance sheets, we've got you covered. But before we dive in, a quick word of caution. While we strive to provide accurate and up-to-date financial and tax information, nothing you hear on this podcast should be considered as financial advice specifically for you or your business. We're here to share general knowledge and experiences, not to replace the tailored advice you get from a professional financial advisor or tax consultant. We strongly recommend you seeking individualized advice before making any significant financial decision. Welcome to the Profitable Painter Podcast, the show where painting contractors learn how to boost profits, cut taxes, and build a business that works for them. I'm your host, Daniel Honan, CPA, former painting business owner, and your guide to mastering the numbers that drive success. Let's dive in and make your business more profitable one episode at a time. Today I'm super excited to talk with Tara Riley. She has a huge amount of experience. I'm really excited to dig into all the knowledge that she has. Welcome to the podcast, Tara. How's it going?

It's going great. Thanks, Daniel. I really appreciate you having me on. It's— this is such an important topic for our, for our painting members, and it's Just great. I'm so glad to talk profits any day.

So yes, excellent. And a lot of folks have probably heard of you already, but if you could kind of give folks like, what's your background in the painting industry? How'd you get started? What are— what have been some major milestones along the way?

Yeah, great. Um, so officially I got into the painting business when I took over as president of Fresh Coat Painters, the franchise, about 11 years ago. Uh, I had worked in the trades prior to that, so I have about 20+ years of experience working in home services, different different trades, but specifically painting was when I took over Fresh Coat Painters. And obviously that gave me a wealth of information about, you know, not just one business, but many businesses and scaling. So, you know, franchising is an interesting world, but I fell in love with the painting business. And even though I've exited from Fresh Coat and now work with the APPC, you know, I still love helping our painting contractors out there. It's so much fun.

Yeah, and that's— so you've, you basically dove into the financials and, and the operations of hundreds and hundreds of businesses, um, because under Fresh Coat you guys had a couple hundred or so, and, and then with Academy for Professional Painting Contractors, you're also working with dozens of other painting businesses, and you've been able to basically dive into their numbers, dive into their operations, and figure out what works and what doesn't. Is that fair to say?

Yeah, absolutely. I think at Fresh Coat we had, um, you know, we when we grew the business, we grew it from about $15 million to a little bit over $70 million in the 10 years I was there. We had about 170 units. So, we, you know, what was fun in the franchising world, we were launching new businesses. So, we understood what it took to launch businesses from scratch and ramp them up. But we also had scaled businesses. And my passion, as you know, Daniel, is about scaling, you know, is really about working with businesses and understanding what are the barriers that stop you from having the business you want. This goes back all the way through my career in franchising, whether it was in painting or other businesses that I started with. It actually started way back when I worked with McDonald's, you know, and trying to figure out how to grow a restaurant profitably so that owner-operators would have, you know, the lifestyle and the profits that they wanted out of a business. It was, it's something that I've been passionate about for a long time. Even, you know, just running my own restaurants. I've had, I had that in my background, but, you know, yes, we had Fresh Coat. We had that. Experience, we had, you know, the opportunity to help, you know, like I said, hundreds of business owners. And at APPC, we've got well over 100 members right now. I personally coach 15 groups of various sizes, and I also run our peer groups. And what's really nice about the peer groups is we really dive into the numbers with our peer groups. I obviously do with my coaching as well, but so there's another like 25 or 30 members that are in our high-performance peer groups that we get to see their monthly numbers as well. So I'm a numbers gal, you know that I'm a nerd when it comes to numbers. And because why are we in business if we're not there to make money, right?

Yeah, absolutely. Well, I'd love to dive into the— your topic, which is how do you scale or what the things that prevent you from scaling? Can you just— what are some typical things that prevent folks from scaling to the level like, you know, Maybe you could take an example of— there's common hurdles that happen, like around $500K to $750K, there seems to be kind of a breakpoint that's preventing folks from getting to the next level. Can you just give me your thoughts on what are the typical things that prevent folks from getting to the level that they want to be at?

Yeah, you know, that's a great topic, you know, and we all know there's that— we call it an inflection point. That's what I have always called it, where people get, there's sort of sticking points, right? We get stuck, and that is absolutely true. We saw that at Fresh Coat. People get stuck right around that $500,000 mark. And to me, and it's also these things happen in all service businesses, it's not just painting, but what happens is it starts with a mindset issue, right? So the role of the owner changes dramatically in that when we start flexing from that $300,000 to about that, you know, $600,000, $700,000, and The reason is mostly most people under the, you know, $300,000 are working heavily in the business, doing it themselves. Nobody can do it better than me. You know, if it needs to be get done, it needs to be done by me. And our energy at that level is going, as an owner, is going into doing things. To get to that next level, you have to start to hire people, not just painters, but you have to, you can't, we all have, you know, I'm sure most painting business owners have an S tattooed on their chest and, you know, a cape and bow tie. Boots in the closet, they can do everything, right? We're Superman. But the bottom line is you're human and there's only so many— you have a limit to your human capacity. And as the business grows, the demands in the big buckets of, you know, being able to produce, being able to acquire leads, to being able to sell and to administer your business all grow along with the size of the business. At some point you can't do it all and you need help. So getting the mindset of starting to hire somebody, feeling comfortable with that a lot, and that's my number one barrier that I've seen with business owners in general is that this not having a good comfort level with being able to hire somebody, delegate, you know, and not just delegate and disappear. That's one of our fears. You know, that's one of the things if you don't know how to delegate and follow up and, and you're not comfortable in that role, it makes it really difficult to get from that $300,000, $400,000 to $700,000 because that's where your, your role changes as an owner. You change from working on things to starting to work on people. It's like you're investing your time instead of investing your time and doing lots of things. You start to invest your time into acquiring and developing people. And that's a, that's a challenge for a lot of, a lot of folks. And that's to me one of the biggest barriers in that first inflection point.

Yeah, that's a common thing I hear is for folks in that range is, you know, there's no good people or like I can't I can't find anybody that to help me, or like just very, the labor market is, is down or, or something like that. Something to that effect. What are your thoughts on, on those excuses?

Well, and that's a limiting belief that many, many people have. And I, I think in, in terms of coaching, I've, I've had to coach a lot of people through that. And the, you know, the thing is that if that's what you believe, you'll, you're, you're right. You're gonna, you're absolutely, you know, whether you think you can or you can't, you're always right. That you have to get through. That's the limiting belief that stops people from growing. You— I look, I've learned there are people out there. There are, and there are people in your social network. I mean, if you think yes and how in that role and start thinking about who can I hire and believe you're going to find them, you will, you'll find them. I've never had problems finding people, whatever level I'm at. You know, if you have a question about that, just turn around and look at people you know, with that are running million-dollar painting businesses that are running $2, $3, $5, $20 million businesses. How did they get there? They have people. So magically the people only exist in that particular community, or maybe they're just better at it than you are. I mean, hey, look, we know the fear, but I say that, um, you know, my comment on that is a couple things. One of the, I think one of the bigger fears of hiring people is this automatic there's a checkbook fear, I call it. If I'm going to hire somebody, I don't, I think about all of a sudden, this is just an immediate drain on my cash flow. Like, I feel like I'm grabbing my checkbook, you know, I've got a check right here. Okay. And I'm going to write a check. If I'm going to pay somebody, you know, $40,000 for the year, I'm like, I'm writing a check for $40,000 and just handing it out. That's the first fear. And it's like, so. You have to realize that when you hire that person, it in— you— there's a math formula that says, hey, I need— I'm gonna— my business is now going to grow incrementally to not only pay for that person, but, but we do the math to say, how do I pay for that person, ensure that I get at least 20% back from that investment? And that's the way I always look at it and say, I want, you know, if I'm going to invest in somebody, I want, I want that person to be self-liquidating. In other words, the the incremental growth in my business because I've added this person covers their cost plus I'm going to make 20% off of it at least or more. And that's my rule of thumb in terms of hiring. So we always, when we're going to do the math to see, okay, how much, and people are shocked at how little incremental sales you really need to pay for somebody. It's not a big number. It's not, you think it's, oh, I'm going to have to double my business. No, no. Usually the number to cover that might be an additional $10,000 a month or something, you know, at the latest, at the highest.

Yeah, I think that's a useful exercise is once you, you're deciding to make that hire, identifying how much additional sales you need to make to cover that, and which kind of tells you like, I guess you need to basically grow the pie bigger for, you know, you're taking a smaller cut of hopefully a bigger pie once you bring them on, because you're going to be able to focus your attention on things that are going to grow the business, as opposed to just hiring them and then hanging back, unless that's your goal is to hang back. And, and I'm assuming here that you're, you're trying to scale, trying to grow.

Yeah, absolutely. And you may— and Daniel, you're bringing up a great point, because there's really two values to hiring. It's not— one would be the scalability and growth, the other is lifestyle. So as an owner, I'm, you know, if I'm killing myself, I mean, a lot of our owners are, and I'm trying to relieve some pressure on that and give myself some more freedom and flexibility. I hire somebody to take on some of the tasks and activities that I've been doing. Gives, you know, I may not, I may be okay with that. I may be okay with taking a lesser cut of, you know, of the business. But like you said, if we do it right though, the math works out really great. We take a smaller percentage piece of a bigger pie, and you'll actually find out that the dollar amount we're taking is bigger. You're actually making more money and working less. And that's what we shoot for. We shoot for the math to say you're going to— you're literally going to work less and make more.

Sounds like a good deal.

That's what— that's what we should— that's what we're looking for. Yeah.

So mindset limiting beliefs are definitely a thing that hold people back from growing. What are some other constraints or bottlenecks that are preventing folks from getting to the next level?

I think a scarcity mindset, kind of, it's still in that mindset. It's knowing that you have to, you're going to send your money out hunting, we like to say, right? So you're going to invest in the business and understand that, that, that you've got to trust that the money is going to go out and bring friends back with it, right? So we're looking for like, if we're going to invest in marketing, so the next, usually the next The people capacity is the first limiting belief, like I need to add some people, but then realizing that I may have to invest if I'm trying to grow aggressively and I'm trying to make the math work on, you know, uh, paying myself back for that investment. Now I may need more leads if I've been relying on, for instance, just repeat and referral business. Uh, am I getting enough leads to get this increase in sales, or do I need to invest more? The big, I mean, the big gap that we see is people don't understand the value of their business. They don't understand the value of their lists. You know, it's a big just gap that I see out there in the, and it's not just in painting, it was in all the trades, but the most valuable thing in our business is our customer list. And, and there's a number of people out there that can't even just conjure up a list. But if you have a good list, then are you communicating with it? Because if you want repeat referral business, first of all, you'll get, you'll get some, but just because the wind happens to be blowing, you know. But if you actually nurture your list, you'll increase that amount of repeat referral significantly. We've seen that. I've seen that in the numbers. So that's the first place to start. And then, you know, if you want to grow more aggressively than that, then you're going to have to put some money into outbound marketing and more of a cold marketing, right? You're going after not just repeat referral, but now I'm going after those more expensive cold clients. But here's the beauty of that. They're only cold once. Once they come in, now they're in your list. And the beautiful thing is if you're working your list the way you should be, The, then when it makes the value of that cold marketing even higher because every customer you acquire now increases your list. I tell a lot of our clients, say, hey, you know, we, there used to be that old joke like the person with the most toys wins. Well, in our world, the customer, the person with the most customers wins, right? The more customers you have on the list and that are viable customers, the more you can win, the more you can leverage that. So You know, that's the equity of a trades business, is absolutely the customer list.

Yeah, and it's, it's, it's crazy how much, uh, it reminds me of that story. I think it's Henry Ford who, um, they were like generating a bunch of sawdust from building, building, uh, Model Ts or something like that. And then he's like, what do we do with all this? They were just like throwing away the sawdust, but then they ended up taking the sawdust and like using it to sell another product. I forgot what it was.

Kingsford Charcoal. That was the—

Charcoal, that's right.

In fact, the Kingsford Charcoal brand came from Ford. He put a friend of his in business making charcoal and buying the— because they had a lot of wooden parts, I guess, in those old Model Ts. And yeah, that's a great story. But it is, it's, you know, it's how do we make, you know, how do we make a viable business out of a scrap, right?

Yeah. And folks treat their customers like now on to the next one, like getting more customers, but kind of ignoring like, hey, you have this person who just paid you $5,000, $10,000, probably should use, try to get more value from that relationship.

Yeah, that's, that's the, I consider that the transactional mindset. We think of the business and that limits us in a number of ways. Like, so when we see the customer as a transaction, versus an equity stake in our business, we treat that customer, you know, we, we, it affects several things in the business. One is quality assurance. It's, you know, how do we, you know, how do we, do we ever market to that customer? There's so many things, you know, we don't worry about getting a, you know, getting a Google review, putting a, you know, putting a yard sign out. I mean, all those things that swirl around realizing the value of that customer versus I'm just, I'm just onto the next painting project and that customer's down the line. I think people misunderstand how often people will paint if they know how easy it is. You know, people think, oh yeah, they're only going to paint once every 10 years. Well, that's not really true. You know, I've, I had, we've had customers in our database for FreshCoat that painted something every year and not I mean, I'm talking res repaint, not commercial, not property managers. I mean, just a single, you know, residential customer.

So yeah, absolutely. Yeah, we have painting businesses that do millions per year and it's mostly referral and repeat work and folks painting every other year, every year, just getting more work done. So yeah, it's— yeah, I think your focus on the Understanding the value of the list is definitely a good focus. So once you're— it sounds like once you kind of, you know, got the low-hanging fruit from the list, then it's time to move to outbound, more outbound aggressive tactics. Like, I'm assuming like Facebook ads or door-to-door or direct mail, like going out and finding people.

Networking. And people, a lot of people underestimate the power of networking. So I think if you're, you know, you should be doing your— what I call your operational marketing, which is loving your list, making sure you have yard signs, your vehicles are wrapped, all the things you can do, you know, just, you know, and, and marketing to your own list. Then it's, you know, you should be networking, and networking works both in res and commercial. Then, um, you know, obviously digital outbound is the, the simplest, you know, so Google LSAs, um, you know, it's, you know, it's funny, that space changes so rapidly. I mean, this, all this gray hair on my head came digital marketing, I'm pretty sure. It's how much it's changed. I mean, I can remember one of the first trades brands I worked in was a cabinet and floor refinishing company. And we still required Yellow Pages ads. That's how old I am, by the way. There was no internet or the internet was just sort of, it was out there, but nobody was advertising on it. I mean, we were still doing freestanding inserts in the newspapers and, you know, lots of, you know, and marriage mail and direct postcards and, you know, all that. Uh, and you know, it was that in that group we started to, you know, started to have landing pages and we started realizing, oh, you know, we, and vanity numbers. And we started thinking, man, a lot of calls are coming from this internet thing. That's, this is more than 20 years ago. So just say, but in the last 20 years, the amount of change, just when I was at FreshCoat year to year, the, the, the amount, the, the rapid change in digital and the constant change in digital. Is it's not for the faint of heart, but it is also the fastest way to get to people. So, you know, you know, first I can remember telling people, whatever you do, don't advertise on Facebook. Oh no, Meta is the place to be right now. You know, you got to be, you got to be on Meta. Oh my God. You know, it's, it's, it's crazy how fast that changes, but it means you need, but that means the average owner needs help, by the way. And this is the other mindset, you know, in order to grow, you've got to acquire expertise, you know, so the capacity Capacities are things like human beings to do things. Can I get leads? You know, and we'll talk, and we were talking about this earlier, Daniel, is, you know, how do we know where our gaps are, right? You know, so, so whatever it is, we, wherever our gaps are, we gotta figure out how we're gonna fill them. And, and I think we were talking about how do we determine where the gap is? You know, you have an acronym for gap, which I like. I just think of it as, okay, Do I have enough of something? And so I, I start, this is where, you know, we can talk profitability, but I, this is where I start, like, how much can you produce every week? This is a, there's two big numbers that I look at for every client. One is first, number one is gross margin. You know, are you job costing? Do you know what your gross margin is? Are you on top of that? I refer to gross margin as mama as far as the KPIs go. Yeah. You know, why do we call it Mama? Because if Mama ain't happy, no one's happy. Your business isn't happy. And as a, as a coach, if your margin isn't right, that's the first thing we're working on because, you know, I've had, I literally have had franchise owners and clients who come and say, I need, I gotta work on my marketing. And I'm looking at their gross margin going, no, you don't. Do you want to dig the hole deeper, faster? Because if you're spending money on marketing right now and you're only turning a 28% gross margin, we have a serious problem right now. That's, not sustainable. So we gotta fix that first. But, but assuming that we, we're turning a good gross margin now, it's okay. What, how much money do I wanna make? And that's, this is another mindset thing I work with people on in coaching all the time. It's like, begin with the end in mind. It's okay to have a goal to say, how much money do I wanna make? I think, I think a lot of people think business just happens. Like that. You don't— it's in the Netherlands, and I don't really control anything. I'm just out there operating. The bottom line is people who plan, who write plans, who write business plans and say, and, and say, I'm going to drive to an end result, get there. I have very few clients I've ever worked with who actually write a reasonable business plan that don't achieve it, you know. Um, and it's because this is a great business to be in to make money. I mean, that's one of the reasons I'm still here. It's because I felt— once I saw that— I was in restaurants for years, and with little thin, tiny little margins with lots of work. And I remember the first time I looked at a trades business and I saw the bottom line and went, what have I been doing for 20 years? I'm insane. You know, it's like I should have been in the trades. I mean, so here I am, right? I mean, our ability to scale, it's like infinitely scalable. You don't, you're not, you know, retail businesses are stuck in 4 walls and there's a ton of investment that goes to acquire these 4 walls and then turn a small amount of profit out of the bottom. The trades business, you know, you can scale it to, you tell me what you want to accomplish and it can be done. I mean, it's, it's, it's, I'm like, it was mind-blowing to me, you know, when I saw that. And this is again, almost 30 years ago, but it's like, oh my God, you know, this is great. So, so you've got to look at like, if I have a goal, we were talking about, you know, let's put a big ass, big hairy goal out there, you know, $5 million, you're going to hit $5 million. You gotta be able to produce $100,000 a week, right? 52 weeks in the year. You know, you know, and some weeks, honestly, because of seasonality, you probably have to be able to produce $150,000 certain weeks.

Mm-hmm.

Because you're not gonna, you know, may not produce that, but we can get into that detail later. But, you know, you just, if you look at the math and say, okay, can I produce, do I have enough physical capacity between W-2 painters, subs, whatever? You know, to, how can I produce this amount? Okay, if we say yep, then I have enough, you know, painting resources, applications resources to do it. That's good. Okay, well, can I produce that? Or am I? Well, do I have the pipeline to do it? Do I have enough backlog or do I have enough work coming in the door right now to be able to produce 100,000 a week? And if I can, if I say yes, then I have to look and say, okay, if I'm not producing 100,000 a week, but I have the capacity to do it, there's something broken in that scheduling or, you know, deployment of labor. We have a problem there, right? So we could say there's the problem. If I don't have the pipeline, then I start working my way back towards, okay, can I sell? You know, am I, what am I able to sell? Do I have the capacity to sell $100,000 a week or more? And we would have to look at that. And if I have the physical labor to do it, but they're not selling, now we got to start looking at marketing. Do I have enough leads? So you can really just work the business backwards and say, and I love to pivot it because at the end of the day, the profitable production, weekly production is you've got to hit that. If you're not hitting that, you're not going to hit your goal. You're not going to be able to cover your overhead, whatever. So that, that is a critical kind of, um, I think just sort of a flowchart. You look through the business and say, you know, you had all of this has to be in balance. If you're producing, if you can produce $200,000 a week, but you're only selling $100,000 a week, at some point you're going to deplete your pie. And I've had clients have this happen where they deplete, they don't catch that they're depleting their pipeline too fast. They're not backfilling it and all of a sudden they run out of work. That's not a situation we want to be in because you've got this big machine that we're trying to feed and all of a sudden it comes to a screeching halt. I've seen issues with pipeline where we get lulled into a sense of complacency in a bigger business. I've had somebody have a $2 million pipeline, but because of timing and not paying attention to what was the timing of this pipeline, run out of work in the immediate. So we have to look at pipeline and say, how much of this is available to be completed now? I mean, res repaint in general is pretty much now, but you could have, I had a res repaint client who had, you know, it had a really nice, looked like it was a nice pipeline, $400,000 in a pipeline. And we were going into winter and realized all $400,000 of that was exterior. No interior. Then it's like, Uh-oh, you know, it's like, so we have to, you know, you have to look at now, you know, that's dissecting the pipeline to make sure you understand like, okay, what's in my pipeline? Can I produce it right now? And then going back to say, you know, and then based on that, am I marketing in the right areas? You know, like right now, right now for anybody north of the freeze line, you need to be thinking about winter. And that's the other thing, business owners need to be thinking 6 to 12 months ahead. And that's— you were asking me things that limit people from being able to grow. One of them is constantly being focused on the now and forgetting to be— your job as the owner is to be constantly 6 to 12 months out. So right now you should be thinking about how am I going to be above breakeven and feed my team and myself in that— I call it the dark quarter, which is really like November, December, January to me. It's not a— it's that, that even in, even in southern climates, that after, you know, kind of November, December, January with the holidays and everything going on, it tends to be a, um, just a, a challenging quarter for everybody. So yeah.

So how, how just you were talking about booking out, um, how far should folks be booked out for residential repainting? Do you have like a, a range, like they should be like 3 to 6 weeks booked out, or like, or is it just pretty much dependent on what their, their goals are?

Yeah, so this is a— everyone, you know, people feel safer when they're booked out, but here's the thing, we know from statistics that there's kind of— we call it the rules of 3, right? Um, as far as maximizing leads and maximizing conversion of leads coming in and producing work, you need to be able to, you need immediate response to a customer, to a lead. You know, we used to say 3 minutes at the outside, and I mean that, but live answer with an ability to schedule. You need to be able to do, to generate and deliver the estimate within 3 days. I mean, and you should, honestly, you should be delivering it on the spot. You know, you should be a one-call close. Every delay, every little delay you have causes your numbers, it causes inefficiency, right? If you don't answer the phone live, you're losing, you're losing clients. That's a, you know, you're going to have a drop in your booking rate. If you can't schedule quotes in a shorter period of time, you're basically, you're going to have some of those drop off. You'll have, you'll see it mostly in a cancellation rate. If you have a higher cancellation rate, rate with quotes because you're booked 2 weeks out, that's a problem. And honestly, completing work, you really wanna be in that 3 to 4 week window being able to complete work. And we saw that too. It's like, you know, if you, and that's a, people are like, oh man, I only have a 3, 3 month pipeline, you know. The thing is that a 3 week, sorry, pipeline. But that is what, you know, If you, if you're farther out than that, again, you're going to get cancellations. They're going to find somebody else. Um, it's at risk. Anything that the further out something is, the more at risk it is. I, we had, uh, you know, this is, you don't even think about natural disasters, but we had two clients with that, the hurricane that went through the Appalachians and stuff. I mean, we had two clients. I had one client had a whole pipeline of work literally get destroyed. I mean, where houses that were scheduled to be painted weren't there anymore. I, you know, same thing. I mean, just, and this, there were several of our clients that got caught with that. I mean, you just don't, you don't think about that kind of stuff, but anything that's out in the future is at risk. The further out in the future it is, the more at risk it is. Yeah. That 3-week number, and we saw that, we saw that, you know, for years of tracking stuff at FreshCoat, we would see that if you were more than 3 weeks out— now I will say exteriors, it's okay to book exteriors in the winter for the spring. Just know that some of it might get canceled, but you know, you're, you're, you're moving your sales along. You know, Bill, if you're in a, again, above the freeze line, if you're in, if you're north of the freeze line and you're, you're just times a year where you can't do exteriors, it's okay to book those, you know, and have them, have them queued up for the, for the spring and the summer.

Yeah.

Okay with that pipeline, but you, but there's no, there's never, it never snows or rains inside. Your interior work, you want, you want to be able to turn that through pretty quickly.

Yeah. I love the rule of 3. So 3 minutes speed to lead, 3 days to quote it, like you're out there quoting it within 3 days and then 3 weeks to produce it.

Yep.

That's an easy way to remember where you should be for the timing. So I love that.

Yeah. And, and then, and that's also when, if you're finding that you can't hit those numbers, you have a capacity problem somewhere. Like if you're not able to answer the phone live and, and book the quote within 3 minutes, then you either need to, you know, a call center. We, we would require a call center obviously with, with franchising, but you know, if you're not able to do that, then you have a capacity problem there. You know, if you can't get a quote done in 3 days, you have a capacity, you know, it's time to hire a salesperson, right? And if you can't produce the work, you know, if you're 6, 8 weeks out, you need to hire more crews. Period. Yeah.

That makes sense. And that's so we, we talked about the constraint of not having enough customers and then this one's kind of getting out. You don't have enough of a team to produce the work that you have. So if you're not hitting those, those benchmarks of 3 minutes, 3 days, 3 weeks, Right. You'd be looking at hiring more training or maybe training in your current team, whatever it is to, to get your capacity up to, yeah, produce the work. So, because when you produce the work, that's when it becomes revenue on your profit and loss.

So, yeah, absolutely. And I think there's a, again, a mind, a mindset shift that people have is I think when we hire, we feel like immediately I have to give somebody 40 hours and You know, the best operators I've ever seen, you know, have deep lists. You know, Brandon calls it a black book of painters, but you should be constantly, you should always be interviewing painters. You should be assessing them and you should be, you know, keeping, just like your customer list, having a list of painters. I had a franchisee in Fresh Coat who had over 100 painters in his, basically in his book. When he needed, if he had got a big project in, it basically, he let them know and said, hey, you're on my list. And then as we grow and I need somebody, and if I call you and you're on a project, there may be an opportunity to become more of a full-time, but these are part-time, these are W-2, they're not subs. And he would just, you know, when he had a big project, he had no problem. He said, I'd never have a problem finding painters. I mean, like I said, there was, it had over 100 names in that book. Uh, you know, we have a, uh, a tool called 30 Painters in 30 Days. It's designed for you to recruit and talk to at least 30 painters in a, in a period of time. Doesn't mean you're gonna hire them all, but you wanna make a list of 'em. Now, some of you make a list with a big mark that says never hire, you know, like, um, we're not, we're not hiring this person. Yeah. Um, but at the end of the day, you, most of the time it's just, hey, if, if I feel like I know I can, you know, make those calls. I have that list. I've had, I mean, because I've had people turn down a big project because I just don't have the people to do it. Like, you know, okay, your marketing worked, you got the, your networking marketing worked, you got the opportunity to do a large project, and yet you're limiting yourself because you're afraid you can't hire. And, you know, so having the names of that, having the names of good subs, you know, depending on your state and you know, what your rules are. But all those things give you more freedom and flexibility to be able to grow and scale your business. Yeah.

Yeah, that makes a lot of sense. And I feel like I'd be remiss if I didn't go back and talk about Mama gross profit. What do you, what do you look for in gross profit? Do you have a certain like which folks should be shooting for or what are your thoughts on that?

We suggest that in general that, that we should, we target 55% and that's just a general target, especially in respray paint. Obviously, wherever you're at, you know, one, the most important thing is knowing where you're at in job costing, like job costing every project, knowing where you're at and wherever you're at, we need to figure out why, how you can be higher. And so, you know, obviously different segments of the industry lend itself to slightly different gross margins. You and I were talking about like the ratio of margin to customer acquisition cost. Well, the customer acquisition cost in commercial is much different than the customer acquisition costs and res repaint. So, you know, you start needing to look at your business in segments, but in general, that's the number we throw through. And you throughout, I always say if you're, you really should always be targeting 50, you know, for, you know, in general, just be targeting it and working your way towards that. But it's whatever it takes to be profitable.

Right. It's a good starting point, 50%. It's Is it easy, especially if you're getting started? It's an easy thing to wrap your head around with markup, like if you're just getting started.

Double everything.

Double everything.

Yeah.

And then from there, it's— that's the, the way to start, and then you can build it from there. And then there's folks that I know we work with that are— that hit like 65% gross profit consistently, which is, which is, uh, crazy good. But it obviously takes many, many years and a lot of hard work and, you know, proof, testimonials, solid sales process and solid production process. But cool. Well, I want to be cognizant of our time and you've been super generous with it. I really appreciate everything you've shared. It's been super informative. I've learned a lot and I'm positive that the listeners have as well. Do you have any last thoughts or anything that you have going on at the Academy for Professional Painting Contractors you'd like to let folks know about?

Yeah, we've got a couple things going on. Obviously, you know, our big annual event, which has always been well attended and people I think find a lot of value with, is our summit. That'll be coming up in January, I think right at the end of January. I think we start the 29th of January in '26. Hard to believe we're thinking about '26 already. So if you haven't ever had a chance to attend the summit, I highly recommend it. But on an ongoing basis, one of the things I'm really excited about, and I got started here at APPC when I started 2 years ago, is our high performance peer groups. If you're not in a peer group of some kind, I'm telling you, that is one of the most valuable things. As far as not only, you know, if you join, if you came in and were working with me in peer groups, one, I'm going to help you with your numbers. You know, I'm just, you get some free coaching, but you get to see the numbers of your peers, you get to compare what's going on in their businesses and, and really just share best practices. So peer groups in general, I think, are an amazing thing. Obviously, you know, the APPC, if you need systems, you know, everyone, in order to achieve the kinds of things we've been talking about, Daniel, the key thing is we've got to have systems. You, you can't hire— you can hire people, but if you don't have good systems for them to operate, bottom line is they're not going to be able to achieve the kind of levels of profit that we're talking about. And the most important thing that really I think improves people's profit is being more efficient, and systems are what make us efficient. So again, the APPC, we have systems for every aspect of the business, and they're done for you. They're very easy to implement, you know, if you, and if you feel like you need additional coaching to be able to get that done, we provide that as well. So, you know, we're, you know, we're here to help. You know, both Brandon and I and our team are very passionate about helping painting contractors and That's why I'm still here. You know, I've been in franchising. I was always passionate about helping business owners, but I really love this industry and I'm happy to help people. We'll be at all, I think all the PCA events this year. So, hopefully if somebody's going to any of the residential, commercial, and the Expo, we'll be around for that as well. And Women in Paint, I can't, I have to put a little plug in for Women in Paint because that is a, I think this, But to me, I was so glad to see the PCA pull up Women in Pain, and I've been really happy to be a significant part of it. And I'm looking forward to having the opportunity. I think I'll be speaking at it again coming up. So I'm really looking forward to that event. It's great to see us lifting up all the women in the industry. And it's a resource that everyone needs to tap into, you know, no matter what the ownership structure of your business is. There are a lot of really talented women out there that can help you with your business, so don't hesitate to hire women.

Absolutely. And just to caveat on what you said, um, I've been to the APPC's events in January. They've all— since, uh, I think 2018 or 2017, for a while. And it's amazing to see, like, the, the group of painting businesses that have grown just from, you know, when I first started going, like a big business was like $750,000,000, $1 million in revenue. And now they have folks doing millions and tens of millions there. And it's the same people that have grown over the last 10 years or so. So it's really cool to see what you guys have been doing over there at APPC. And we also have— I have a lot of clients that are part of those, um, uh, peer groups that you, you mentioned as well. And I know that they get a lot of value out of, out of it. So definitely highly encourage, um, anyone listening, if you're looking for guidance on scaling to the next level, you definitely take a look at the Academy for Professional Painting Contractors. Awesome. Uh, well, I really appreciate your time today, Tara. And for the listeners, we will see you next week.

Thanks, Daniel.