Flamingo Sunday's 051 - Jim Penman

In a world where 99% of people are desperately trying to fit in, the 1% understand that success is found when you stand out from the crowd. I'm Jack Henderson and this is the Flamingo Sundays podcast. If you're looking for the 99%, you're in the wrong place. This week we have one of the most iconic Australian business founders, in my opinion, Mr. Jim Penman, who is the founder of Jim's Group. What most people would know, Jim's mowing, Jim's cleaning, Jim's pest and building reports, Jim's anything else you can think about. Jim started Jim's group back in 1982 with a full time mowing business and a $24 investment. He originally aimed only at taking on subcontractors, but as his business grew and he gradually became more specialized in building up and selling lawn mowing rounds, he started to build out the franchise group, which has over 5,000 franchisees and a turnover of over 500 million Australian dollars. There is a lot of gold in here. I think if you listen carefully, you will pull out a lot of takeaways. Jim Penman. Warren Buffett famously once said it takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently. What comes to mind when you hear.

That reputation is everything, particularly in a business like ours. It's all. The best decisions I ever made in my life were all things that were done against what I thought was my short term interest, all based on reputation, doing the right thing. Yeah, absolutely, it's correct. But my Warren Buffett, great man, all the more so since he's actually gifting his fortune to the Gates foundation, which is one of the greatest, one of the greatest achievements of humanity, I think.

I think absolutely, absolutely. And, and Jim, the reason that that quote come to mind and, and I said it to you is from everything that I've read in our discussions in the past, you see, I guess your customers and your franchisees as, you know, the core of your business as they are. And you know, they're the people who continue to help grow your business. And if your reputation isn't strong, it'd be very hard to get to the 5,000 plus franchisees that are currently working under the Gyms group.

Yes. At every level. Well, I'd also put staff in that as well too. Staff are incredibly important. If anything, we put our franchisees number one. Everything. That's our sort of a mission. They're kind of my tribe people. So there's no conflict Though, because the way to look after franchises world is to, is to get franchisees to do great service because that means as individuals they make more money and they do better. But also as a group the reputation spreads so more people might, they have good experience with one franchisee, they'll, they'll call us for another division.

And what would we need to understand about Jim growing up or, or Jim's childhood to understand why it is that you care about reputation for yourself and your business so heavily?

Customer service is more of an emotional thing than anything else. People who do it just so they can make more money don't tend to do as well as somebody does it because it's offensive to do a job less than. Well, it's, it's a thing I talk about in my book Experience. When I was very young, like I started at 8 years old doing a job for a neighbor across the back, French to Mr. Tapley. And you know, one time I was just asked me to take some rubbish to the incinerator which used to do in those days, used to burn things off and on the way I dropped some bits of it on, on the ground. And he just looked at me very sadly. He was quite a gentleman. He said, look, if I, if you're going to do it so poorly, I might as well do it myself. And I felt very ashamed. I just was determined, never let him down again. That's a drive to me. When I, When I was mowing lawns, I used to just. I had to be perfect, everything perfect. And in the early days I used to do the edges with the wheel, which you did back in those days, this is the early 70s, and you could do a pretty neat egg, but I couldn't do the other edges around the, the clotheslines and the trees and so forth. And it used to bug me. Nobody ever said anything, but it used to bother me. And so I went into a shop, my repair shop one day and saw my. One of the first brush cutters in Australia. As soon as I find out what it was, I bought it. Even that cut more than the mower. It didn't have much money. I was a student part time. But because I could do the job with that perfectly, that was always just the way I look at things. And I can remember people saying to me, I never knew my lawn could look that good. It was, it's just my, it's an emotional drive that's quite extreme. And, and the same thing applies to my, to my franchisees. It's, it upsets me. People talk about you know, your being proud of having so many. The thing I most emotionally relate to is franchises. Being successful, somebody who's had a great change in life, that is by far a bigger thing than looking at changes in my bank balance. When you do look at the basics, when you actually emotionally care about the people you're dealing with, your clients, or in our case, franchisees, you do tend in the long run to make more money, but it's an incidental thing.

And, and is that something that you, I guess you've just seen as a consequence of doing the best you can possibly do every single day? And over time, that's. That's compounded both in goodwill and, and in financial.

Yeah, it's. It's an experience. Look, just as an example, when I started franchising back in 1989, the normal practice was to take anybody, you know, they used to say $50,000 on a pulse or, you know, hold a mirror to their. To the prospect's mirror, to their face. And if it's fogs, you sign them. This is normal activity. But I knew that people who gave poor customer service or who weren't otherwise suited would fail. And I couldn't stand the idea of signing franchisees who were likely to fail. And so I adopted a policy that said I won't take anybody who is going to fail, which is totally different to anybody else was doing, especially my main rival at that time. My assumption was that doing that would actually mean I wouldn't ever grow very big. And I never expected to be bigger at that time. VIP, my major competitor, has 250 franchisees. When I spent on my first one, I never thought I'd be bigger than them, but I wasn't prepared to make that move to put somebody on that I thought be very likely to fail. That was purely a moral, emotional decision. And yet it turned out to be spectacularly good decision because what it meant was that I would give a list of my current franchisees with their phone numbers to any prospects. And this is decades before the franchising code came in. And that list would sell my franchises more effective than anything. So even though I thought it was against my son, so which was in fact, it was a great business decision.

Reflecting back on that now, because you took that policy and naturally you made the decision as to whether someone would likely succeed or fail based on all of your past experience. Was it a slower start for. For the gyms Gyms group, if you were to compare it to, say, your competitor at that time?

Vip Mostly the decision was made by My trainers, I had people I trusted and I'd send somebody out in the road with them and they'd have to give me a report as to how good they were. And, and basically they were doubtful. I'd say, well, would you put this person on as an employer to run one of your trailers? And if they said no, I wouldn't. And I said, well, I won't take them either. So it was that, that was how I did it. I mean there's certain kinds of things you look for. For example, if you've got a young man in particular whose parents, father or mother are buying them a franchise, that's, that's a we influence, we know that's gonna, they're gonna fail. Almost certainly gonna fail. Yeah, I, I didn't, I didn't expect it to work. I really didn't. I just thought it was the right thing to do. I knew that because I remember speaking to one of my trainers in the pre franchises when he used to sell lawnmowers and he asked me what happened to so. And so I mentioned two guys he'd taken out and he said what happened to them? And I said well they, they both failed within a few months. And he said I thought so. And I said why? And he said because they didn't seem, they didn't have good attitude towards customer service. So even though I was selling lawn mowing rounds and those days I wasn't actually screening anybody. That, that was what made me, that particular conversation made me decide to be selective because I didn't want them to fail.

Very interesting. And that, and that also goes back to your long term thinking and putting an emphasis on customer service. Right. Because in the short term having lots of franchisees, come on, obviously, you know, they pay their sign on fee or whatever it is, probably make short term financial sense, but over the long term it has a, a more significant negative impact on the business if people don't work.

That's right. Well that was the reasoning in the industry. The basic idea is if you, if somebody is not, doesn't seem particularly good, you put them on. Well, first of all, you might be wrong and sometimes they would be too. I'm sure some people I rejected would have been, okay, so you might be wrong. In which case you've missed out on the franchise, you've missed out on the upfront payment, you've missed out on the ongoing, you've failed to grow your business. And if you were right, well, they still paid you for the business and they still paid you fees for the Time being and then they leave and you know, worse off. That was kind of logic of it. It just didn't seem very very. It didn't seem very right to me. That's all.

I like that. So take us back to when, you know, Jim went from being the man on the tools doing the lawnmower run, being somewhat perfectionist about how to do things more efficiently, better, faster, and then going from being the practitioner of doing the work to then starting now to, to grow the business and, and bring people into, to do the work. How did that transition work for yourself?

It happened actually well before the franchise because what I started to do was to build up and sell lawnmowers and to do that effectively I had to actually have subcontractors to do the work in the meantime. It was much, very easy to find work in those days, but getting it done was a problem. So I had this subbying system. I have to admit it was absolutely terrible. I had every, I figured about, I had about even numbers of leads and complaints because the service was so bad and I wasn't trained them and I wasn't selected and I wasn't doing anything in those days. So it was an awful business improve. Much better when I franchise because then I started, we started doing more training and screening and so forth and, and following up and supporting and advising and things. It did get better and then with time it got better and better still. You know, our complaint right now is, is a fraction of a percent of what used to be in pre franchise days. So I was, I was terrible when I began. I was really bad at it. It's like customer service was awful.

And how did that then change? Like when did you get to a point where you thought something's not working here? The, you know, people talk about the seventh wonder of the world in business being word of mouth referrals and getting business organically. And I'm assuming if you had the high complaint rate that probably wasn't happening that much. So when did you make the decision to switch it to a franchise model as opposed to someone else doing the work?

Well, it wasn't so much a decision as it was forced on me. I always had this little business building up and selling lawn mowing rounds and I was doing okay, managed to get down to pay off my debt and buy a house and stuff. So I was, I was all right. Split among myself then a company called Vip, which I mentioned before had been Adelaide. I'd heard about them, they came to Melbourne and I just thought these guys would Crush me. You know, they had hundreds of franchisees. They had uniforms and signed trailers and a fancy office in South Melbourne and in brochures and well, I didn't include any of these things. I just thought these guys were so professional, so well organized, so knowledgeable that they would crush me. I actually rang up the state manager guy called David Mitchell and I said to him, look, I. Jim, Jim mine. He said, I know who you are. And I said, look, I just want, I can't compete with you guys. I just wanted to see if I can help you out and I'll to build vip, provide you with leads and so forth, customers. And he said, no, thanks. So I, I basically went to the franchise Expo that year, which was in the old exhibition buildings in Exhibition street in Melbourne, and took off. Identifying badge, went up to the stand, said, how did your system work as a prospective franchisee? And he told me the guy behind just explained how it worked and what it did and gave me this brochure and all kinds of things like that. So I thought. And then the state manager came on, keep me off the standard. But I went away and I thought, well, I tell you what, there are good reasons for why this could work. You know, I can see this. You, you, you can help each other to find leads more effectively. You can also, if somebody gets sick, like breaks a leg, if you're running a lawnmower business, you lose your business because your clients won't wait. So this way they can look after you. Jealous. I could see the kind of benefits of it and why it might work long term. Before that, I couldn't understand why a person would keep on paying. Franchise fees was my biggest issue. Why would you keep on paying after you established a business? But when I saw vip, I thought, well, there are some reasons for it. But I looked at it and I thought, well, hang on a bit. I reckon I could develop a system that be better for franchisees. Point of view that would be more attractive to franchisees. And it took me nine months of arguing with lawyers to get a contract that I like. And then I gave it to some of my prospective franchisees, like people who bought laws from me in the past. I wanted to transfer across my best subbies. Some of them were very, very good. And I said, what do you think about it? And I actually decided, asked for a few changes to be made, and then I had a system, a contract that I thought was the best and fairest possible, and I launched it. That was what happened. And the time somebody asked me how many franchises Might have one day. And I said, well, maybe if it works. Well, maybe a hundred. Because bear in mind, I didn't even think I could beat vip. That was my attitude at the time. I just, I was very surprised how it took off, that's all. By the end of the first year I had about 60, which was, wow, that's amazing. And then people started coming from Interstate and I hadn't even thought of going outside Victoria. So it was just a surprise, I guess, really I didn't think it worked so well.

Let's unpack the, the initial part of that, that discussion there around you approaching vip, because naturally you thought that, oh well, these guys are going to crush me and I'd rather have some business than no business. What was the thinking around that? And then when they in the end said no, how did your thinking then go? Well, if I can't, if I can't join them, I'll beat them.

Well, I thought I would see if I could try to beat them. I didn't think I could at the beginning. I just didn't know anything about them. I was very overawed. I mean, it sounds strange in these days, but you know, I was just, no uniforms or anything. Have any of this kind of stuff, which is a very minor business, which wasn't even doing particularly well because the customer service wasn't that great and I was doing all right. But I'm making a lot less money than a lot of my franchises make these days, that's for sure.

It was just humble beginnings.

Yeah, well, I kind of see it from the other side of the table. I couldn't understand franchising from a franchise point of view. And as soon as I could see how they would be successful, how I could want to be in their situation, then it began to make sense to me and you just had to try and, but even then I, even when I started franchising, I had no idea what I was doing. I mean, I, I, I didn't know anything. I didn't even know they had a binder with a heat seal binding in. I didn't know what that was or how you printed things or anything. I just didn't understand anything. I was clueless in the extreme. Basically I was a failed academic. I got myself a PhD and used to be after know, 10 years of university. So I know anything about business at all. I just, I just wanted to look after people well. And actually having, having my customers looked after so badly was also very distressing. I didn't like it at all because I Had this emotional thing and it used to upset me. I wasn't looking after customers.

Well, when, when did the. Because naturally, as you've grown from one franchise to 60 in the first year now to 5,000 plus. When did, I guess, learning more business acumen become something that then was important? Right? Because, you know, is that saying what got you here won't get you there? So I'm assuming you've developed a lot over that 30 to 40 year time frame.

There's no when, Jack. It was from the beginning. From the first time I started pushing a lawnmower around or even when I was gardening. I was always trying to work out how to do things better. So there's no stage where I suddenly decided, hey, you got to get better. To me, that's the, almost the crucial point in any business. It's not that you don't have some brilliant brainwave and suddenly you're a millionaire. It doesn't work that way. You go thousands of little tiny decisions, you're always learning how to do it better. And that's the time when I was pushing a lawnmower around and trying to sail off a half second, emptying a grass bag and navigating between streets to the present day when I the same thing, the same question. How can I improve? It's relentless to me. It's 365 days a year. There's never any day of my life that I don't think, how can I improve my better? And there's no day in my life where I don't think, this isn't good enough, this is not helping. How can we improve? What more can we do? And always trying to learn and listen all the time. One of my main people find it most unusual characteristics in business is that I give my phone number and email address to my franchisees at training, every single one of them. And I, and I urge them and I push them to contact me. And there are reasons for that. One of them is that when there's a problem, I want to be able to fix it. And very often I can because I'm the person that has the most power to do anything. You know, just as an almost trivial example, you have a franchisee who is about to start and then they need to change their contract. Now, by the law, that means you've got to wait two weeks. But then you got somebody waiting two weeks without an income. So what I, what I would do is simply say start them, put them on a system, give them leads, sign the contract in two weeks. I don't care. Maybe they'll start and they won't continue. But that's not my concern. My concern is I don't want this person to be without income right now. So I can help franchisees with problems. But the other thing that's equally important is that when I hear from franchisees or anybody there's a problem with the system, I can then go and change it. Now, just before I. I'll give you an example. Just before I started this conversation, I had an email from one of my franchisors who pointed out there was a problem with the manual. The way we define how you take leads, which is quite complicated. It's all done by computers and it's to do with the way whether you take previous lead when you're down for a certain number. And what he pointed out was that the manual was wrong and it wasn't actually practice or at least it was misleading. So I've actually sent an email. This is five minutes before I actually clicked on this link. And I said to the, I said to personally does the newsletters. We need to change the manual. We had to because. Because manual changes require a referendum in our system, even though it's very trivial. So we need to put a notice in the next franchise newsletter proposing a change to the manual so we can clarify this point. This happened five minutes before the conversation based on feedback that I got from somebody, in this case a franchisor. Now, I get information all the time about how things can be improved, how they can be made better, and that's so useful. I actually have very little to do with the business community in general. But I'm intensely close to my own people, to my franchisees and franchisors and staff. I walk around the office every day, different departments, disputing people and asking what's happening and talking about things that are going on. I do that all the time. Franchisees, franchisors, I take from clients, I get feedback from clients often I personally delete. I'm the only person that can delete complaints if there's a valid reason. If a client's got a problem that's not fixed, they can contact. They put into contact with me and I will sit on that complaint till it's fixed and then I'll think about how we can improve the system, make that less likely to happen. So that's that. It's a constant obsessive focus on every aspect of the business, I guess role.

As you become a CEO. If you read the, all the, all the books as I'm sure you've written, read, sorry, a lot of history books. They would say that, you know, probably your system is not by the book. Why do you think it's worked so well? Like instead of having five lines of management that, that's 5,000, you know, franchisees have to get through before they get to you as opposed to just contacting you directly.

Well, maybe I'm a pathetically bad CEO, I don't know.

Or a very good one.

Well, but I'm not very competent at most things. This is the thing. I have a, I have a coo, a manager guy called Rocky and Rookie is fantastic. Rocky has an ability to organize things, get things done, manage staff. He's vastly better than I am. I have a wonderful CFO guy called John. He's, he's much better in his area than I have my Joel Lee, Joel Cleaver that you've probably been in contact with who does the social media stuff. He is far better at that than me. And then I've got other people in different departments, like I've got a lawyer and I've got documents and they're all better than me. Listening runs the call center. She's wonderful. So I'm not particularly capable in those things. So I mean, what do I do with my time? I can't sit here twiddling my thumbs or I don't find something useful to occupy myself with. Maybe if I was more capable, I wouldn't do it.

So do you have, you know, because from everyone I think, who listens to this podcast and most people I talk to, they're always looking for, like, what should be my daily routine or what can I do every day in the business to make, you know, the business grow? Are there, you know, tasks that you see as a super high leverage task where if you do those things on a daily or a weekly or a yearly basis, you know that over the long term your business will continue to grow. I guess outside of constantly caring about your franchisees, constantly caring about your staff.

I'm not good at doing most things. There's a few things that I, that I do fairly well. I'm a reasonable communicator. So in terms of talking to potential trainees, I give a talk, I give a couple of talks at training. And so I'm a reasonable teacher because I teach the values of the company. I'm very value driven and that sort of tends to spread a lot. The way we think about things in terms of looking after franchisees is not just me. It's actually very widespread like just give you an example during the lockdown in a couple of years back now in New Zealand, we had a competitor who actually continued to charge their franchisees fees even though they were forbidden by law from working, which got me a lot of trouble in the media and stuff. Now, anybody who suggested that kind of thing in gyms would be. Would be. You cut them off the loony bin. Nobody would even think of such a thing. So all my franchisors, of course, they weren't charging fees when our people weren't allowed to work. But you know what was so characteristic? They actually spend more time counseling and talking to their franchisees than they did when they were getting paid for this. Because that's the kind of people that they are. By and large, they're people who care about franchisees quite a lot. And if any conflict between us, it's often that I am a little bit tougher and they are very soft when it comes to franchisees and they want to give them too much leeway. And I said, no, you've got to come down harder. So it's kind of a. So I, I have the cultural thing. I have that, that ability to teach and share values and to communicate what we think. And the other thing I have is an unusual level of. Of creativity. I'm very original in my thinking. Somebody will come up with three standard ways to do something, and I'll think of two others on the spot. I just have that kind of mind. I did it in my. In my PhD. I came up with ideas that were incredibly radical that we're still pursuing. And we're about to write. Start writing a really important book about some of the changes that we're doing about society and so on, how they work. So it's the way I think. I'm very, very, very unorthodox. And I'm always coming up with new ideas, even in my 70s, which is unusual.

So it sounds like you, you focus on the. The things that you are the best at being people and creativity, and then leave everything else up to the people that you see are better at that than you are.

That's right. I actually find myself sometimes with not quite enough to do. I'm always having to look at things like writing a book or something like that to occupy myself because I think I should be doing something useful. I probably work about 40 hours a week. I'm no workaholic. I have a reputation for it, but I. I'm not interesting.

And does that change over your career? Were you much, I guess, heavier into Work. Making sure you had to work 60, 70, 80 hours a week during your, your, you know, I was going to say growth phase, but your business is still growing extremely fast even at this stage.

I don't know, I don't really think I ever particularly worked. When I was a Lonn contractor, I would work for long hours and then go back and office in the evening and do on paperwork and stuff. So I suppose then I probably worked longer hours. But the other thing is I, I'm a great believer in, in the, in the saying there's no other success can compensate for failure in the home. I've always had time for my children. I have 10 kids and, and I always wanted to have time for them. I don't think it, I don't think it justifies it if you don't spend time with your children. I mean, having said that, I'm, I haven't got a great history. I've been divorced three times. Not, not particularly my own choice, but anyway, that's the way it happens. So I'm not saying I'm a great husband, but I, I am very devoted to my children. Always have been, always good. I mean like my, My son, my 14 year old, I drive him to school and pick him up those days and we have a good conversation. He's a very unusual kid. My, my Aaron, he's amazing. We're talking about evolutionary biology and, and politics and he's giving me advice on marriage counseling and stuff. He's a, he's a really, he's a really great kid.

How good. So it sounds like there's, there's the, there's no, you know, one way or one thing you should be doing to be able to grow a business of your scale. It's about doing what feels right to you in the moment. So it doesn't like you've, you know, outworked everyone else or been, you know, super obsessed with X, Y and Z. You've just done what's felt right at each stage in your business career.

Yeah, look, people have different skills, they're very good at doing different things. Some of my franchisees now have got businesses that are overwhelmingly far better than anything I had when I was a pre franchise days. They're better at customer service, they're better at choosing staff, they're better at a lot of things. So I don't think there's, I think you got to focus on what you can do. Well, that's just a simple matter. I mean, you look at the companies that develop technology. I mean, we're very poor at technology. We've wasted millions of dollars with the wrong technology and the wrong false starts and this kind of thing too. People who start businesses like Twitter and Facebook and stuff tend to be technology titans. They're very good at those areas. They focus on them initially and they understand them very well. So every people have different skills and they're different businesses. They can focus on different areas. But I do think you've got to figure out what you're good at and focus on that and then find people to do the things you're not good at. And that's the exciting thing about business too, because you can, especially as you grow, you can afford to find good people from different areas. A big difference becomes when you can afford to pay a salary of, say, a quarter million dollars a year, that kind of level, and then you can start to hire people who are exceptionally capable.

And going back to when you were, I guess, growing the business with competitors that were larger than you, because there wouldn't really be too many competitors today that are larger than you. But something that I know I struggle with, and a lot of people I speak to struggle with, is that comparison. You know, like, you look at the VIP of your day and go, how big are they? They're doing so much better than I. And then you get down on yourself because you're not as good as as they are, but you're, you know, maybe at a very different point in your business journey. Did you ever suffer with comparison? And if you did, how did you ever deal with it? To know that you're on your own journey and what they do doesn't matter.

I think the first thing to recognize is that by the standards of the service industry, in our particular niche, we are big, but in terms of the business in general, we are not. VRW did this thing about, you know, the rich 250 or something like that, and they want to put me down for it. And I said, don't be insane. I'm not even close to that level. So there are a lot of people, thousands and thousands of people in Australia who are more successful than I am in a purely financial sense. But. And then even you look at overseas people like Bill Gates and, you know, Bezos and the rest, and they're multiple times richer than me. But there's a wonderful saying, I love sayings, which is tributed to Theodore Roosevelt. Social comparison is the thief of joy. You really shouldn't be comparing yourself with anybody else. It's a very unhealthy way to do it. Now whether that comes down to Facebook likes or comes down to focusing on your competitors in business or whatever, it's much more sensible to simply look at what you're doing and saying okay, how can I do what I do better and have that sense that I'm not the greatest person in the universe, but I'm going to use whatever skills and talents God's given me to be successful as much as I can to achieve whatever I can. I like the parable and the talents which Jesus told. You know, you know the story. You know a man has three servants, he's going away on a journey. He, he trusts the money and talents, a lot of money. So one he gives five talents because that guy's super capable. And then the other person, he gets two talents a bit less capable. And the third guy, he gives one talent to not as capable and he goes away and he comes back and the man with the five talents comes and says here's. I went out and traded and I did business and he's five talents more. I doubled it. Good, great. Second guy, two talents comes up, says okay, I did the same thing, I doubled this. Here it is. Yeah, great, you've done well. Third guy says, I was so afraid of you because I knew were a harsh man. So I buried it in the ground. Here it is back again. The master gets very angry and said you should at least have put it in the bank and got some interest on it. The point about that is it doesn't, it's not so much the person with the five talents was better. They each had their own level of talents. It's what Jesus was saying is we need to use whatever talents we have at whatever level we have. That's our responsibility. Not to be better than somebody else, but to be as good as we can be with whatever we've got. I am not the most capable businessman in Australia by a long, long, long way. That's not my aim. My aim is to do what I do as well as I reasonably can given my own limitations.

I love that. Broken down like an expert.

Yes, I think about a lot. If you looked at anything my. Somebody asked me the other night what's my. Who's my mentor? And I said, well, Jesus obviously, because that's the way I think about things. You look at the Jesus washing his disciples feet, which was a very ugly thing to do in those days. That was a job for slave. That was a really demeaning thing. And occasionally a very respected rabbi, the, the disciples wash his feet as a sign of great Respect. But Jesus was revolutionary. But if you think about that's how we see franchising. I am not the boss, I am the servant. My franchisees are my primary client. My aim is to make them successful. Do you turn the whole power thing on its head and is that something.

You work at daily? Because naturally as you get more money, more freedom, more success or people that are telling you successful. You know, I know I've struggled or suffered with it. It's like you, you get this, you know, sense of, oh, I don't need to do that, I can pay someone to do it or do I really want to go and do that now when I don't need to? How do you, how do you keep that sense of like humbleness and then also the, the want and the drive to do those tasks that you don't need to do now because you know that it is the right thing to do for both yourself personally and then also your business.

I don't quite know how to say that. I've got a lot to be humble about. I suppose I'm also aware of my own flaws of character and ability. So it's, it's, it's not all that difficult to feel that sense of unworthiness, I suppose, until I'm totally down on myself. But I, but I always have the feeling I can do better. I have a feeling of constant, I don't know where that comes from exactly though, Jack. Honestly, I do see it as a danger though. I mean it's, it's funny these days, especially in the last few years when I become better known people, there's kind of old attitude when they, when they, when they meet me, legendary gym figure, even though I don't look like, no beard or anything. So I, I, but that's the safe and worth the video. The better you know me, the lesser or if you less in order you're going to be with me. So I'm not that awe inspiring in real life.

Well, it's very true. What's that saying they say about when you, you know, sometimes it's not, it's best not to meet your heroes because when you meet them. There's some saying about that, I don't know the exact wording.

Yeah, well, they say nobody's the hero to his valet. Not that I would have a valet, but it's, it's the people who know you the best aren't usually that impressed by yeah, my wife or something like that. They'll certainly tell you I've got plenty of flaws like, like I said, My 14 year old is always lecturing me about how to get on with people better. He says you have a high iq, but you've got an awful eq emotional. And he's very, he's got a very good, big iq. He's eq. He's very, very understanding that people, he reads their reactions extremely well and I don't.

Well, he had to have learned that somewhere. Jim, you see.

No, not from me.

Let's touch on. You said before I was as well known as I as I am now. And it's, you know, one thing that I noticed over the last, I would say 24 months, I'm very active on socials and I started to see this just gyms pop up here, there and everywhere in some pr and then I saw videos and then I saw you on Tick Tock and Then I on LinkedIn. You were popping up. What, what was the moment where you thought, okay, well I've been doing this for long enough now. Let's start to concentrate a little bit more on I guess personal brand as such. Because you know, I didn't even really know if Jim was a real person. I knew the business, but if you asked me who is Jim? I would have had no idea where. Now there's actually a face to the brand or the name as such.

Yeah, I get recognized in the street these days, which is very odd sometimes. Jim always very pleasant. Anything bad about me? I think the biggest single thing was our beloved dear premier Daniel Andrews, who decided to shut down independent contractors during the COVID epidemic in the early stages, which was a crazily unnecessary thing to do. There was no health reasons for it. In fact, his own department of Health and Human Services said that independent contractors outside should be allowed to operate. Danger to public health. And then he gets up at a press conference a few days later and says, you can't get your lawns mud, your house is clean. Typically appealing to his affluent inner suburban woke lefty supporters rather than having an interest in the poor sods who were throwing out of work for no reason. So he shut us down and I got very, very upset about that because I could feel it. I'm talking, these aren't strangers to me. People I talk to every day, ringing me and talking about the stress they were feeling and the financial problems because not all of them had government support. We had one poor lady who was a student and she was threatened with addiction from his house because she couldn't pay her rent. This country couldn't afford to eat. So I got very Very angry and upset about that. And I made a big, big fuss and I wrote open letters and stuff and I have a wonderful PR lady, Tess Lazarus, helping with, and Joel Cleaver was helping with all that too. So we started to make a very, very big fuss and beginning, it turned out very negative. Two of my daughters wouldn't speak to me for months. They, they were so angry at me taking on their beloved premier. But with time, public perception shifted a bit and people were saying things like, yeah, okay, so an individual lawmaker working by themselves is a serious strange public health. So why are council gardeners doing the same jobs, working in groups, that kind of thing. So I started to get purchased with the public and the other thing that went on was simply Joel. Joel's a young man. He actually came to me over a decade ago to work in a very basic menial job, administration of filing or something like that. And gradually developed into this social media guru, became very good at it and is now one of my top people, top managers, paid many times what he paid for when he started, I can assure you. And he's just become exceptionally good actually self taught. He does a lot of reads, a lot of Gary Vee and stuff. And we gradually learned, or he's learned in particular how to do it. And it's interesting how these things work. And one of the things we do is every third week we do this thing called Ask Jim which is a sort of a live interview. Anybody can ask me questions they like and I'm reasonably comfortable like I'll ask any questions off the top of my head. And what he does is he takes segments of that and puts them out. Like for example, I told a joke about New Zealand one time and he put that joke out on social media and it got 1.6 million views. Now only about 60 or 70 people watching it live. But when you take things out of it, the individual questions that put them out and then you start doing interviews with franchisees and days in the life of stuff and what we often find is that little things with a handheld camera often work as well as having really or even better than, than, than great production values. It's really strange. And you never know. You, I'll do a sort of, I'll be walking through like a trade down, talking to a particular franchisee with experience just casually. And they're following me with a camera and a microphone of course. And, and, and this gets hundreds of thousands of views. It just, it just reaches the public perception and they recommend it. So it's this kind of lots and lots and lots of small things. Like one of the things we do recently, which has just started is we have these things called Accor vouchers which give you, it gives you, you get free accommodation and you get heavily discounted meals. They're quite nice things to have. They're really good value. They're worth about 600 bucks each. We bought 500 of them at a discount, of course. And what, and what we do is whenever a franchisee has a story or anything at all, they've done well, they've lots of five star reviews, they've had a fantastic first month, great going income, numbers of employees, community service, things they've done well, how it's changed their hand, anything at all, any good story, we do an interview and we give them one of these vouchers which is a way of thanking them, congratulating them. But it also gives lots and lots of publicity. So we're doing hundreds of these interviews and these are going out the spread and they do very well because they're real life stories and they're often not about people making a fortune. It might be somebody who's talking about how they were able to help elderly people in their community, for example, or you know, the guy who works with the homeless or something like that, or somebody who's, you know, fostering children or able to support their local football team in various ways that they couldn't in the past or their lifestyle better. They've seen their sons grow up when they couldn't have. Lots and lots of stories about how their lives have been changed. And that stuff is very powerful and we've got a lot of them actually. There's a lot of people who've got so many great stories and we spread.

Those out and, and how much of an impact would you say that's had on. On not only the happiness of all of your team but then also the growth of, of the business. Because I remember the last time we spoke, you, you said prior to, to Covid, you were sitting at like 3,800ish franchisees and, and now 5,000plus.

Yes. And growing fast. We've only hit 5,000 a couple months ago. We're at 5,070 or something. It's quite extraordinary. And what makes. Look, in a sense, it was quite hard to understand Covid, in a sense, you look at it, yeah, people thrown out of work and they're needing jobs. So franchising numbers tend to start going up then. But as our business is related, is limited not by actually by clients, but by franchisees, last year we had just under a third. 32 point something per cent of all of our leads went unserviced. The demand was huge. This year it's not quite as Strong. It's about 25% on service so far. So we have a lot more clients than we have ability to look after them. So our limitation is finding franchisees. Now, the really peculiar thing is that since COVID we've had the tightest employment method ever. We've had people in short supply, wages have been built up, unemployment level is remarkably low. That should be the worst time for us. That should be the time when we were least likely to grow. And yet we keep on growing. Now, I cannot explain this in any other way except that the social media thing is so powerful that it gets the story out there. See, people don't believe. They kind of have this idea that, well, first of all, that, you know, you're, you're a gardener or you're, you're building fences, obviously you're a manual labor. That's pretty low. You can't make good money. Maybe 30, 40 bucks in a. An hour, maximum. They somebody who gets up and talks about making like $120 an hour or $180 an hour, and there's these stories all over the place. You talk people making extraordinary amounts of money and, and how lucrative it can be and how good. That's a surprise. People just don't understand. And, and even, even little things like the fact that I give my phone number to all my franchisees. People find that very odd. And it comes from the franchisees themselves and they say, look, I tried to contact you, I had a problem and he took a call and fixed it like that. That kind of story just gets out there. Little stories, they're all, they're all true, but people don't know about them.

So you're just essentially documenting the stuff that's actually happening as opposed to trying to create this, you know, crazy, highly produced content.

Yeah, it's very, very crude stuff. It's, it's amazing, Jack. I just cannot comprehend. Virtually everybody who comes to training has seen this stuff. One of our trainers, Dan Carl, who's actually a highly sustainable franchisee, now a franchisor who teaches in our training course. It's. He's also. People know about him already because he's done so many videos because he's such a spectacularly successful guy. This is a guy who is a high school dropout. He, he's, you know, he's the Kind of person that people say he's garbage. He's human garbage. You're not going to achieve anything. He can't be a lawyer or a doctor or a tech guru. He's. He went to work for McDonald's, did quite well, became a sort of a local manager. There's not, not a big thing there, but you do that. Quite young then, in his early 20s, decided he wanted a bit of a change. Buy a lawn mowing franchise. Big risk. Big, big, you know, can I afford to risk 25 000. He didn't have a lot of money. This guy then built a business, employed some of the people expert Donald People to do it, were actually pretty good workers. He, at his peak, he was turning out just under a million dollars a year. He then went out of that and become a franchisor. He's working in partnership with us. He's basically doubled the number of franchisees in the region. Looking after, fantastic coach, fantastic at sales, fantastic motivator. And he's now, well, some of, he's a millionaire and he's still in his 20s. That kind of story is possible. People don't understand what you can achieve in the service industry. It's so open to talent. It doesn't matter what your education is, it doesn't matter how much money you have. You don't need much money to start. You can start with almost nothing. If you've got the drive and the ability and the ethics and the passion to do this. You can do extraordinary things. We just need to let people know.

So, Jim, if, if we were to reflect back over the, the long career that you've had and the very successful career that you've had, even though you, you may not think so yourself, what, what would you put down as maybe the, the, the three key things? Now you reflect back on it and you go, these are the, these are the three things that you know, have gotten me to, to where I am right now. And I reckon I know two of them, two of them in my head from our discussion so far. But what would you say the three key things are?

Relentless focus on doing better is the number one thing I'd say. If there's one thing that distinguishes and I'm not looking at myself, I'm looking at also I'm a kind of a mentor to in effect, hundreds, even thousands of people. At a certain level, if I look at who's successful and who's not, the ones who are best are the ones that say, how can I improve? And the ones that are the Worst are the ones that say, I'm already good enough, I don't need to change if anything goes wrong, it's not my fault, somebody else's fault. They've got to change. That's the one. First thing, constant improvement. Second thing, focus on your people that you're dealing with, on their welfare and their interests. Above all, if you, if you look after your customers really, really, really well, or in a franchising terms, if you look after your franchisees well, and I'm not saying we do either of them as well as we should, we don't, you'll tend to do a lot better than if you think first of all about the money. You've got to make sure there is enough money. Do what you, you've got to control your cost to some extent, and I'm not always good at that. But you always got to be focused first on the interests of the people that you're dealing with. If they're going to be really happy with you, then somehow you work out a way, make money out of it. Those are really the two, two biggest things of all. And, and I, I guess another thing I would simply say is that money isn't everything. I, I don't believe that just piling up wealth is, is an, is, is a, is a valuable, is a worthwhile way of living your life. And it comes down to this idea. People just want more and more so they can spend more and they can display more and show an expensive car and a big house and a fancy clothes and prestigious holidays and this kind of thing too. And I have to say, too, I, I don't think, and science pretty well backs me on this, that it makes you happy. But constantly trying to sound better than anybody else isn't, isn't valuable. And what actually does work when you've got money is experience is a lot better than things if you actually go out with friends, if you have a social life, if you've got relationships with your family, that, that really matters more. And, but you know the number one thing that creates happiness that you can do with money? Give it away. Give it away to a cause that you believe in, that you're involved in. The way that Bill Gates does with his Gates foundation and the way that I do on a much level with my research foundation, which is actually most of my net income, goes into that because I think it has a tremendous value. So I'd say do something worthwhile with your life. Don't just pile up money. Money's useful. It's a great, great servant, but a bad master.

Love it. What a way to end. Jim, Appreciate. Appreciate your time for the second time around. And this time we'll make sure it goes to where. I appreciate that, mate.

Okay, no worries. Jeff, it's good to talk to you again. See you.

You too. See you, mate. Thank you. This is general advice and does not take into consideration your objectives, situation, or needs. You should consider if this advice is suitable to you or your circumstances. And please read any applicable PDFS beforehand. This is a Henderson podcast production.