On The Record - Jim Penman

Hello everyone. I'm Troy Dodds and welcome to the on the Record podcast presented by the Western Weekender. On this podcast, I'm joined by special guests who all have such great stories to tell about Penrith and the role they've played in our city. They are Penrith stories told by Penrith's people. Today, my special guest is Jim Penman. Now, Jim may not be from Penrith, but locals will certainly know his name and his business. As the owner of Jim's Group, he's built one of the most recognised franchising businesses on the planet. And many of his franchises, of course, are right here in Penrith. It is an incredible business story with plenty of twists and turns along the way. Jim, thank you for joining us.

Good to be here.

First question we always ask, you weren't from Penrith, so where and when were you born? Where did you grow up?

Well, I'm ashamed. I wasn't even born in Australia. I was born in the uk, but my mother's in Australia and she was visiting Engine. Met my father when she was hitchhiking. So came to Adelaide when I was three, went to Sydney for a year about the age of 14, and then ever since then in Melbourne.

Okay, and what was your childhood like? Tell me about parents, siblings.

Well, second of four children, second child, tends to be the rebel, so I guess that's me. I'm a bit more unorthodox, my family standards. I don't know what you say about parents. Very at home, mother very devoted, my father pretty fierce. Not untypical of a kid growing up in the 50s and 60s, I guess.

And I know you were born David, of course, so we know you as Jim. Where does the come from that you went with Jim and is that from a young age or more so, in business?

Well, my legal name's David James. I don't know, it was kind of a way of breaking free of my childhood and taking a bit more of a macho sort of thing. I mean, women tend to like David in my experience, but Jim is very, very Australian. So when I left school and left home, I was actually working on a farm for a while, for a few months after I left school. And there was a young about my age called David. So I said, call me Jim. So I got used to it.

There you go. And of course now we know that name very, very well. You went through high school, of course, then to La Trobe University, Ph.D. in history. And like many, you needed a part time job and you started a side business mowing lawns. Now in your book, this chapter is called the Accidental Gardener. So I'm guessing that gardening, mowing lawns wasn't necessarily a passion per se. You fell into it.

Well, actually, it's something I've always liked doing. I've actually been gardening since I was eight years old. Apart from about four years later, I need to move to Melbourne. I've always had a gardening business. I started way even before I started university, just doing good. And then I bought a mower a few years later. But it's kind of. I do like being outside. I really enjoy. I enjoy gardening, in fact. In fact, this weekend I'll be up at my farm and I'll be mowing the, the lawn and, and I'll be digging vegetables and planting nuts and stuff. To me, that's a hobby. I just love reading things. I love being outside. It's very important too. I mean, it was a good job. It paid me. You know, I've got the equivalent of like 10 bucks an hour back in the 1970s, which is very good money. I even bought the first house as a student out of my, my, my lawnmower. But I also like it and it's very healthy. I mean, it's, it's, it's physically active. I had a franchisee just recently. He'd done one month. He lost seven kilos. Yeah, it's a great job. And gardeners are known as being one of the happiest professions too. They do surveys, gardeners come right at the top, and lawyers tend to go down somewhere near the bottom. So there you are.

And how did you build your client base in those early days?

Well, I just basically put leaflets and then local papers to a certain extent. It was very easy. I mean, look, I didn't know anything about business, but what I did have is I had a huge asset that I was really passionate about doing jobs well. I just have this thing that let a client down is really distressing. It goes far beyond any financial consideration. I mean, if I see a edge of a lawn and there's one blade of grass left, to me, it's like having this beautiful fashion model with a big, ugly red sore. It's just intolerable. Or let a client down or forget them. So I had this absolute fanaticism about quality and service. And I find it very, very easy to get clients and keep them and get referrals and so forth.

And in 1982, of course, you decided to do this full time. So when, where did that sort of transition happen that this was no longer a hobby? This has become a pretty successful business that's as you said, that's helping you buy a house and really setting you up.

Well Troy, I'd love to say it was a decision, it was more an act of desperation. What actually happened was that I got into a financial mess actually. I was trying to expand the business part time a bit and I lost everything and got deeply in debt. It was just stupidity. I was lazy and dumb and trusted the wrong person and everything else. But look, I always intended to be an academic. I had this idea about the way society works and how you could improve it and what was going wrong. And in terms of the biology of history, I had a very radical idea and I wanted to pursue it. That was really my passion. But nobody's going to give me a job because I had a PhD in history, which is about one of the most useless things apart from PhD in psychology or in sociology you could possibly have. So there was no prospect of any sort of employment. And what I wanted to do was to pursue my research. But to do that would require an awful lot of money because it's all to do with. With genetics and hormones and so forth, what we now call epigenetics. So I just, I just turned the only thing I knew which was my Lawrence and I launched full time. And that was in just December 1982.

And it doesn't take long actually before things start going pretty well for you in the, in the mid-1980s you. I guess we get the first inclination of what's to come because you start selling off some of your rounds because you basically got too many clients.

Yeah, that's right. I found because I was so good at picking up clients, I could see it's not just when somebody rings you. It's not just a case of first of all you bring them back fast. You get in there when you say you will, you do a superb job. And I could go in. There's actually on our website there's a video of me going in and cutting grass that's a foot high and cutting it clean. And I could do edges, I was really good at edges. So I could do a really immaculate job. People would say to me things like, I never knew my lawn could look this good. So it was because I was looking after clients so well. I built my client base very, very fast. And you bit of advertising and stuff. I actually was a kind of a surprise. What actually happened was that I intended to. I actually failed my PhD. It was just too radical. And I was knowing lawns full time. And there was no point to it at that stage. And then my supervisor said, well, you know, if you rewrote the methodology, you probably get it. But I was so busy that I didn't have time. But then I thought, well, I might as well do this. So I thought, okay, let me sell off my customer base. And while I. It took me a while to get find a buyer, I did it through the age, through local paper. And while I was arranging to sell my client base, I kept on getting more clients. And by the time I'd sold my first lot of customers, I had another lot of customers already ready to go. So I sold that group offer and then I had a third lot of customers. They still kept on building. So I sold three lawn mowing rounds in very quick succession and took some time off and finished my PhD and actually got it. And then I thought, I'm making more money from selling lawn mowing rounds than I am from actually doing the grass myself and putting on subbies and so forth. So I focused on that and I had subcontractors to help me. So I did that for a few years.

Yeah, and I guess that is the start of what ultimately comes, which is in the late 80s, you start selling Jim's mowing franchises. Did you know much about the franchising world at all? And I guess in, in that period, franchising is kind of mainly all about restaurants. And I don't know if there was too many selling lawn mowing franchises around the world.

Well, there was one actually, and that was Vip, which is based in Adelaide. And I vaguely heard about them. But look, to be honest, I couldn't see the point of it. I couldn't see why a person would buy a franchise. Why wouldn't they just buy the customers? But when I heard about Vip, I thought, well, you know, interesting, but they're in Adelaide, they're not going to affect me. I mean, nobody, nobody could do it interstate. And then they came to Melbourne and I basically panicked. I really thought these guys would crush me. They had about 250 franchisees in those days, which was very big. It was huge. And they had all these offices and, you know, logos and all the fancy stuff. I didn't have a clue. The only thing I knew about franchising was what I read about from McDonald's. I read a book called behind the Arches. So I knew something of the principles and the idea that you look after franchise as well. So I basically, I rang up the state manager for VIP and offered just to help build vip. I said I'll just give you all my customers and good rate and help you build up vip. And he said, no, I don't want to do that. So I thought I might as well compete. So I actually, I crashed the franchise expo, which was that year 1988. I just went in, took up my badge they gave you, didn't want to know who I was, went up to the stand and said, I'm very interested in vip. Can you tell me? So they told me about it. So. And then the state manager came in and kicked me out. He said, that's Jim Penman, don't tell him anything else.

Well, you learn to learn enough tricks to get you going anyway, we all make.

Yeah, look, I give full credit to, to Bill Bis. He, he was the pioneer, not me. I just looked at what he did and said, hmm, well, good system benefits, but I reckon I can do something that will help franchisees more.

We all make mistakes in business, particularly in the early days. I'm guessing there was a few bumps in the road early on.

Monumental crashes and stuff. I mean, I had no idea that this mine thing would work. Back in the 80s, I tried to get a, a tourist resort going. That was a pathetic failure. I had no idea what I was doing. I've done various things. I've tried to run different ventures, all of which failed. Mower shop and computer sales and all kinds of things. What do you call it? Trade exchanges. Done a couple of those. I've just tried all kinds of stuff and I just. I know what I know. I'm pretty good at mowing lawns myself. And running a service type franchise is very similar with its cleaning or mowing. So you stick to what you know. That's one of the biggest lessons. But it looks very hard too. I choose the wrong people. I don't have any particular knack for choosing good. They actually come through the trip through the system, usually my franchisees or franchisors. But it's very hard to find great people that are not very competent. Troy there's so many things I'm not good at. I'm not a particularly good manager. I'm not good with figures or anything. I've never done a business plan in my life except for the give something to the bank to keep them happy. I'm just not particularly skilled at most things. So you've got to find people who have got those abilities.

You mentioned the McDonald's example and obviously one of the keys to their success as they grew was consistency. So I'm guessing that you took that into business in terms of franchises as well. You wanted them to be caring for clients the same as you did and that would help you build.

Yes, exactly right. It's this obsession that continues and it still continues. I deal with customer complaints on a daily basis. I mean, you've got to understand we've got close to, I don't know, best part of a million leads a year. Every complaint, every poor survey that comes back, I personally look at. If any customer is complains more than once about a problem that's not fixed, it comes to me. So I'm very carefully involved and I'm always planning and trying to change things and do better training and better software. How can we improve service? And that's what's actually happened. It's not a case of just setting a system up and letting it run. You're always fiddling with it. And one of the things that we check most strongly is the level of complaints. Now in pre franchise days when I had subbies, it was. I was a terrible business. For every like 100 leads, I get 100 complaints. Roughly speaking, complaints as leads, not turning up, particularly that kind of thing. And then I franchised and I got better people and we started emphasizing it, so it dropped down to about 5%. And then we started looking at complaints and monitoring them and giving feedback. And then we put survey system in place about 10 years ago and about 30% of our applied to respond to a survey. And we just keep on changing things. Now the actual level of complaints now is a fraction of a percent. It's more than a 99% improvement. And we've got plans for software over the next year or so. I believe we can cut that down to less than half of what it is now. So we're just constantly driving down the level and then set up training systems. And I did the first two hours of that training every. We have one this week actually. So Monday morning at 9 o', clock, get out. And I talk customers. It's really hard. I really push the point again and again and all this stuff they got to do and what consequences they don't. And I really passionate about customer service. But the other thing too though, and it's even more important or just as important for franchising, is you got to look after your franchisees. That's what McDonald's is pretty good at. They're a very good franchisor. They also got very good staff training. But I admire them as a company and we do the same thing. I'm focused obsessionally on my Franchisees, every one of them has my phone number, my email address, and I give it, not only give it to them, but I tell them again and again, you've got to ring me if you've got any problems, contact me, don't let it go. I'm going to send you a letter in the month to see how you're going. You respond to me. I'll feel very offended if you don't. And they do contact me. You know, several people a day would contact me about something. So I'm always knowing what's going on, what's happening, how can we improve? Why is somebody failing? Do we make a poor selection? Could we train them better? Could we have better software? What can we do to help my franchisees succeed? And we look at things like attrition rate very carefully. What is your chance of being in business in 12 months? That's a particularly strong one. And we found, for example, that when we put a very good training program in place, our attrition rate dropped from 17% to 10.5% first year. And it stayed around about that ever since. Gone up a little bit since then. So if you're going into business like lawn mowing or cleaning as an independent, your chance of being in business within 12 months is between 5 and 10%. You can look it up on the Internet. That's much better. Which is with us at the moment, 88%, but that's not good enough. Why isn't it 90%? Why isn't it 95%? How can we do better?

Yeah, we'll definitely touch on your penchant for being very, very meticulous in communication and whatnot. But I just want to go back. When did you start to say, well, hang on, this is working here, this is becoming successful. And then I guess a two part question. When did it start going well beyond Melbourne and interstate?

Well, I had no idea about this thing actually at the beginning. Somebody asked me right at the beginning, they said, if it's worked out, how many franchisees could you have one day? And I said, well, if it works out well, maybe, maybe as many as 100. Of course we've just passed 5300 or something. Latest figures. I was surprised. I never even thought of going interstate. I really thought this was something that was Melbourne only. I just, it just. People just got interested. Well, I had a secret weapon actually, and it really was pretty simple. In those days is way before the franchising code, nobody. You didn't give out the details of current franchisees, but I used to do that. When I, When I had. I got all my franchisees in the list and I put them with their names and their phone numbers. If anybody came to talk to me, they. They say to me, well, why would you. Why would I do buy from you? You know, running your business from your basement, you got. You got nothing. You've only got a few franchisees. This other company's interstate. They've got a lot more. They've got this fancy office. Why would I buy a business from you? And I said, well, there are some differences in the way you run the things, but here's a list of my franchisees with contact numbers. I want you to go and they want you to ring as many as you can and, and ask them what it's like. And then I want you to go to VIP and ask them. And I knew they wouldn't give them because I knew that their people weren't as happy. That was a simple thing. It was very, very basic. The office, everything. What I wear was just ordinary stuff and still by my clothes from Kmart, apart from the uniforms. But my franchisees were happy and I really focused on making them happy. I just did everything I could to make them delighted. And I showed that I cared about them, which I do. It's genuinely the saddest thing in my life to see a franchisees franchisee fail. I never get come accustomed to it. I hate it and I'll do anything I possibly can. We got a franchise who's failing in one division. We will. We just had a case recently where a franchisee wasn't one division is not doing particularly well. And I just. We changed them to another division and I'm paying a whole sum of money to get all their, Their, their signage and stuff done because they just don't want them to fail. It's. It's a very personal, emotional thing. It's not. I don't know, I'm. It's not rational. I don't. I don't. My wife says I'm a nutcase. She says I'm. I'm a. I've got some Alzheimer's or something. Not Alzheimer's. What do you call it? Asperger's.

Not Aspergers.

Yeah, Everyone seen off. I've got Asperger's because I'm. I'm ignorant of social clothes, but I'm very obsessional character.

You mentioned divisions there, so obviously you went away from just gyms mowing, which means that you went away from what you knew. You mentioned earlier you could mow A lawn to look perfect, probably win a competition somewhere as the best mowed lawn. But then you started getting into other areas that you might not have known much about in terms of industries. Was that a difficulty for you? And do you seek advice about those industries or how do you decide? Well, I'm now going to do Jim's Dog Wash, for example.

Well, actually, that's what Steve's advice. We seek good people. So we find somebody who's from that industry who knows the industry. That's how it works. Most of them, great majority don't actually come from me at all. They come from somebody else approaching me. So somebody will just email me. And I'm very good on emails. If you email me jimimps.net, i'll answer it or I'll see it. If you try to market me something, I probably won't, but if you come forward with an idea for a new division, then I'm available and I'll talk about it. Say, what's your background? What's your business background? What do you know about this business? I mean, how does it work? What sort of hourly rates can you offer? How do you market this kind of thing? So you find somebody who knows what they do, but in actual fact, things like mowing and cleaning and dog wash and pest control, they're very similar. Somebody wants a service done, they contact you, you go and offer it, you give a quote, you do it. The software involved in the systems and the contracts are all remarkably similar.

Yeah, I guess there's, you know, the actual business side of it isn't all that different. Is there anything you won't do? I mean, as we mentioned, you've got Jim's Dog Wash, Jim's IT Services. I don't know how many divisions you've got now, but you pretty much do everything.

Well, yeah, there are limits. On Monday night this week, I was having dinner with some friends and one of them said, why don't you do Jim? Jim's Airbnb? And I said, no, we're not going to. He said, no, it's a great business. We should do it. I'll do the research and stuff. I said, no, it's outside of my field of expertise. You have no idea how complicated this is. It's a different system, different software. We. We stick to what we know. The things that we do are very similar In. In. You don't go into areas I wouldn't. I mean, I mean, like fast food, for example. I'd never touch fast food because you cannot compete with people who do this, who are so good at what they do, but we are good at what we're actually very narrowly focused. It doesn't seem like it, I know, but the difference between mowing and cleaning and dog wash and fencing, they're all very similar in the way they operate. The same kinds of customer service issues, the same kind of generic training. Very similar.

You've got a lot of franchises here in our area in western Sydney. I've used a couple of them myself. Car detailer at one point and I think your mowing services as well. How, how involved are you in the early days of a franchise owner coming on board?

Well, if it's a franchisee, just bear in mind we put on, you know, best part of a thousand people. So I don't get personally involved in it. What happens is I, I speak to generic. The training that we do, we have a three day course. In fact, today is the, naturally, yesterday was the final day, the three day course. So I give two talks, one at the beginning about customer service, service to franchisees, the franchisees rights and what we do for them. And then at the end of it I do a talk on earning income, how to get more leads, how to increase your value. Right, those my two talks. I also make a point of trying to greet every franchisee personally. I don't shake their hands because if I do, I get ill all the time again, colds and things. But I bump fists. We have a special kind of bump fist with a, with a raised thumb. It's like an okay sign with a bump fist. So that's what we do. So I go and try and greet everybody at least once, hopefully more than that. And then we have a session called Ask Jim on Tuesday night when they can ask questions and stuff and it's quite a lot of fun. You tell jokes and stuff and they ask me all the outrageous things. The more outrages, the better they'll get prizes. So we do that kind of stuff. You try and I try and get to know them, I try and get to some contact with them personally and I say I'm going to write to you in a month's time. I want you to respond. I put my phone number, my email address on the board. I say you contact me if you need to. I really push it hard. So I just try and encourage them. So I can't individually ring every franchisee because there's just too many, but I really encourage them to respond to me and when they do come to me, I respond very quickly and as helpfully as I can and sometimes doing quite drastic things I'll massively bump up their advertising for example, change in a different division or do a different franchise or arrange them to get jobs from other divisions which we can do. We call it cross divisional work. So if you haven't got enough in your division you can do some other work for another division if you're qualified. And I just try and be available and try and be there and show that I'm concerned for their welfare.

I think that being available thing is a really interesting thing because you did mention and we've done it to set this up. An email to you is normally responded to within 20 or 30 minutes. I would say that 99% of people in your position would not even be reading emails that are going to them. They'd have a fake email address almost and then an email address only a few key people know about. Why have you wanted to remain so close to the day to day operations of the businesses?

Yeah, I think it's a colossal mistake. People don't respond to their emails. I cannot comprehend it. Just to give you an example, we wanted some major consulting work done about a year ago and we approached five major companies with basically something that would have been worth six figure contract. Not one replied. One replied months later. Just pathetic because they don't even read their emails now. I find emails is really easy. I, I would, I even check my junk mail. I do not trust the junk mail system. I check it regularly because quite often it'll be one of my franchisees get gets held up and I believe I'm not going to listen to one of my people. It. Look it's, it's incredibly useful to listen to your emails. Every franchisee knows they could reach me and it's not just. I mean I want to help them, I really do. They're kind of like my family in a way. I'm very invested in my franchisees. But it's not just the fact that I can help one person. I can look at it and say what's going wrong? How did we make a mistake? Why is this person having these problems? How can we change the system? How can we change the contracts? How can we change the manual? How can we change the technology? How can we change the training for franchises? What do we need to do to make this better? And it's that obsessional listening to my key people, clients to a large extent even I don't phone them but email, but particularly my franchisees. What's going wrong? What can we do better? It's Gold, as a CEO of the company, it's so important for me to know what's really going on. And what's really important in gyms is not some great plans we make in head office. It's what happens when an individual franchisee goes out there, contacts the client, satisfies the client, makes good income. What can we do to improve that? So you have to be involved and you have to listen. And honestly speaking, the amount of time I do certain kinds of jobs, like I'm the only person in the company can delete complaints. If a franchisee does something wrong and they can show that, sorry, there's a complaint, the franchisee can show they did everything right. The customer says, didn't ring. I said, okay. Franchisee sends in their, their proof of they've rung them and proof they sent a text within two hours that's deleted. Or if they make a mistake, something's gone wrong, they go back, they fix the job, client's satisfied, here's the evidence. Deleted. So I do that. That's one of my jobs. I also deal with these high level complaints. So I do those kind of things. But apart from that, just being open to emails from everybody, including marketing, everybody else, it probably takes me something like maybe 20 minutes a day. And I get well over 100 emails a day. But it's not that big a job to deal with those things. I'm astonished people don't do it. I find it extraordinary. I think people come to me, they say they've worked for a company, but for 10 years there was like 500 people and they've never seen the CEO. Now I'm very, very contactable, but not like that. But I also wander around. We get about 100 staff. I wander around the office every day saying hello to people, how's things going? What's going on? I might sit down and play chess with somebody or something with the group at night or something, just briefly, always on time so I don't distract them too much. And then we have a staff lunch, which today at 1 o' clock I'll go to the staff lunch. And we have a, each department takes it in turn to run the lunch and they have a little quiz thing and that mixes everybody up and I'm there too. So you've got to be in contact with people.

I guess many CEOs just fall into that trap of being told what they want to hear by people that are feeding them information and they then miss out on everything that's actually happening in their company. And then it's too late to fix it when they realise the truth.

Yeah, they've got no idea. There's a wonderful comedy series. Yes Minister, Yes, Prime Minister, British many years ago. Now. One of the things most striking about that is, I mean, I'm always the minister in a way, I suppose. I don't know if they else is. But he doesn't know what's going on because everything he does is dealt with through his senior civil servant. So he has no idea. If he wants an efficiency improvement, all he's got to do is ask them, what can we do? He's got no control because he doesn't know what's going on. Now if I was the minister, I'd be wandering through the department. So what's going on? How's your work going? How could it be improved? You know, how's your boss treating you? I do that all the time too. Going into the conference center, I talk to the staff, say, how are you being looked after? You know, the franchisees, the trainees being nice to you? I ask that kind of question all the time. How's the food? You've got to, you've got to understand what's happening. Because I'm not the great person to doing things. If I need something to be done, I've got people who are much better than me at doing that. But I need to know that something has gone wrong so that I can say, hey, we need to change this.

How much? Obviously everyone brings people into their business sometimes that don't work out. They come with the. The best of intentions. How much effort do you put in to say, I can turn this person around, I can turn this particular franchisee around. Or sometimes you just have to say, this is, you know, we've got it wrong here, let's just drop this person.

Look, we'll do everything we can. Sometimes it's not the fault of the franchisee, sometimes the system is wrong. I'll give you one example. We've got a division called Jim's Pet Patrol, which is to do with things like walking dogs and dog care and picking up poop, which sounds gross, but they got a way of doing it which is really good. And some franchisees are actually doing quite well, but a lot aren't. And it's just got to the stage where I'm not prepared to have any more franchises sold because the chance of failure is too, is too high. So in this, this is the case I was talking about beforehand. This is a paper trial. Person couldn't do it. I said, okay, look, we, we've got the money for the thing, we'll pay for all your costs, all your signage or your training, everything else, we just pay for it. And you go and do cleaning. Because I know they can get working clean. So you've got to somehow recognize that it's not their fault. But sometimes the franchisee just doesn't do what they're supposed to do. Sometimes they just don't give good service. Now we counsel them and we send warning letters and we do retraining and I personally get involved in this. But if somebody in the end won't listen, they won't look after their customers properly. It's bad for the company and it's bad for them. And sometimes you just have to say you've got to go. It's only a small fraction, but it's very painful. It really hurts.

And I guess also what would happen is that some franchisees don't share your passion for being so meticulous. And I know you mentioned earlier, did this, how quickly did they reply, how quickly did they send the text? Because from a customer point of view, that customer obviously is normally an impatient customer. Most customers are impatient. They want their lawn mowed, they want something fixed. So the longer you leave it, the more likely you're not going to get the customer and the more likely the customer is going to question whether they're going to go with the right person.

Yeah, that's right. And that's the constant battle that we've always got to be. We're indoctrinating and we're pushing very, very hard. But, you know, one of the things that's really humbling is that to a large extent, my kinds of values are very widespread within Jim's group. This passion for customers, it's, it's like, you know, if you're in communist China or something and they're brainwashing all the time, they keep on telling you the same thing. In the end, you tend to, you tend to absorb the culture. And Jim's culture is very, very customer service minded. It becomes part of the way they think. They get it from myself and I'm a reasonably, you know, charismatic individual on the face that launched, you know, 5,000 trailers or whatever. I mean, it's, I have this and I speak quite well. I'm a reasonably good public speaker, one of my very few talents. So I get this across and then I talk to them and it's emphasized again. And then the franchisors coach them, they ring them, ideally weekly, at least in the beginning, and they keep on pushing the point. So, in actual fact, most of my franchisees do have a pretty strong customer service aspect. But not only that, but you would find there's an element of care for franchisees which is very widespread amongst my franchisors. We really care about franchisees. And that's again, when you do franchisor training, then we really hit that business of looking after what's in the interest of how do we make them happy? How is that our moral responsibility? And we had a guy called Brian Duckett many years ago, we had a national conference in Queensland and the franchisors were there. And he was. This guy had been involved in dozens and dozens of different franchising operations over the years. And he said, jim, I've never seen anything like what you do at gyms. And it's this genuine care for franchisees which comes from the heart. Again, not universal, but generally speaking, franchisors are people who really care about other franchisees. And what's more than that, what you tend to find, too, is that franchisees tend to abide this thing. So you often hear stories about how people get mentored and somebody who's an experienced franchisee will just take the time to help a new person and even spend like half an hour, an hour on the phone to them at night just counseling them. We've got unpaid franchisee mentors who give up their time just to help other people. And we had terrible problems in Melbourne with their lockdown. It was a disgusting episode. We were locked out of work for two months and there were franchisees who were really desperate and what so heartening. I mean, it was a terrible time. It was very distressing. I was very angry about it. But what was wonderful was that so many franchisees just volunteered to help others. We had one girl who was actually students. She had no government support. She was forbidden. She couldn't wash dogs for two months. She had no income allowed by the state government. And there were franchisees who were giving her food vouchers and stuff. We actually lent her a bit of money and we said, if you can, you can come and set the conference center to get evicted. But that was so wonderful. I remember a test and tag guy ring me up and said, yeah, I've got no income, but I'm financially secure. Who needs help? Because that was so moving. And that's a very widespread attitude. And I tell people that, too. I said, when you go to meetings and you've got to go to meetings, got to come be part of the community. So Important. When you go there, you'll find other franchisees who really want to help you and with time you'll do the same thing yourself. So culture is incredibly important and it's very hard. You can change the rules and the contracts, but the culture really matters so much. There's a wonderful books called Good to Great, Jim Collins and Studies of Organization. They tried to work out what was the key thing behind these long term successful companies and they really couldn't think of anything that was so different. But then they said one thing. Each of these long term successful companies, the one like Hewlett Packard as an example, had a culture which was very widely spread, shared from the CEO to the mailroom, the way they put it. And people who came in either adopted the culture or they got spat out, they quit or they got fired. And Jim's is a very culture driven company on that.

What comes across is you are so passionate about happiness and well being. And that is something that was mentioned a lot in your book as well. Jim's book, of course, that's what it was called when it came out a few years ago. You are legitimately passionate about this. I think you're legitimately passionate about the human psyche of what makes people happy and what motivates people as well. That seems to come through.

Oh yes, yes, yes. I'd love to write a book called something like the Health and Happiness Handbook. There is a science to happiness and it's not people think. People think. Characteristically, if I just get more money, I can buy a better car and a bigger house and better clothes, more expensive holidays and make me happy. It's actually pathetically untrue happiness. If you don't have enough money, if you're struggling, really struggling, then you're going to be miserable. Past about average Australian income, it makes surprisingly little difference. And what matters though too far more than what you buy. Theodore Roosevelt said social comparisons are thief of joy. So just trying to spend more than somebody else to look better is a really bad way to spend money. Spending on experiences like time with friends and so forth is better. The best thing you can do with money is to give it away to a cause that you're personally involved with. That's what scientists find. So that's money. Then you can look at exercise. Exercise is hugely important. It's far better than any antidepressant. I do half an hour vigorous exercise every day at least. I've just used on the run, on the treadmill. I'm going to play racquetball this afternoon. I Also walk a lot. Average probably at least 10,000 paces. I don't measure it. And then food, you've got to have a good diet. I have a BMI of 22. I keep that very closely by myself every day. Try and eat vegetables, fruits, those kind of things too. Then you've got social relations. You've got to have a good community. And my community is my family. I absolutely adore my wife of 23 years. I got 10 kids, and I'm pretty fond of them, too. And I was just going to see them, some of them last night with one of my grandchildren, my grandsons, and that's great. And community at work, too. So happiness is. And then time spent outside. I love working outside, being outside, in contact with nature. These are all. Keep your debt under control, don't owe too much, don't commute too much. These are all principles that have been shown to create happiness and health. And I have to say, I'm one of the happiest men alive. I don't think there's anybody on the face of the earth who's happier than me. And it's a very calm, just a peaceful, happy, fulfilled life that I've got. It's absolutely wonderful. And there's a science to it. And the point of this, too, obviously, I'm fairly. I'm fairly well off, but I don't live that way. I've got. I buy my clothes from Kmart. In fact, until just recently, I've never had a new car in my life. And mostly they were wrecks with about 10 grand. So I don't spend money on myself. I just. There is a science to being happy. And. But the interesting thing about it, you don't have to have a lot of money. All. Everything I'm talking about is just as capable of being done by one of my mowing franchisees, really is they've got everything. They've got the potential. It's health, it's outside, it's fitness, it's, it's, it's good social relations not only with your family, but also with your fellow franchisees. It's having a flexible lifestyle. It's keeping commuting to a minimum. It's, it's. You don't have to spend a lot of money to look good when you're mowing, because people don't expect you to drive a, you know, Mercedes or something like that. So. So you don't have to do that kind chasing of steps. So it's something that anybody can do. And there's a simple science to it. I really, I, I'd love to actually set up a, a kind of a business to do with health. That's my, my great passions. I'd love to. I was just thinking that this morning I'm listening to this book called how not to Die which is all about plant based eating and health. And I'd love to set up a, a venture where it's a sort of a really healthy sort of restaurant, but also health advice and counseling and get people to, you know, have a sort of like a personal trainer for health who coaches you about exercise and then, then prepare meals that you can, you can heat up and use at home and, and you can eat really healthy food. That's a huge, huge, that's a huge help to it. Not in longevity, but living a long healthy life. You see, I'm 71, I back to turn 72. I've got a lot to do in the next 20 years. I cannot afford not to be healthy. I don't believe in retirement and I don't think we need to retire. We've got guys in their 70s still going out there mowing great lawns. This one bloke just had his 80th birthday. Why do we need to retire for? We've got so much to contribute.

Yeah, we learned a lot about you and a lot about what you're saying here in that book that came out a few years ago. I wanted to ask you about that because I feel like, and tell me if I'm wrong, but is that potentially the most vulnerable you have been? You also, you wanted the author to go out and speak to people, if I recall this correctly, who didn't necessarily like you, who would be considered, you know, almost a business enemy of sorts. You wanted the truth, the true story to get out there. This was not going to be a just a Jim Love show per se.

Yeah, I gave them all the context actually. There was somebody who actually took me to court some years ago. There were a franchisor who I thought wasn't doing the right job. And so I terminated them and I offered to give them fair price for their business and they, they decided to go to court and sue me. In the end I ended up settling with them and I gave them what I offered in the first place. They did not like me at all. So there's various people who dislike me. My sister that I fired because she wasn't doing a good job. She's not a great fan of mine. There's other people who don't. I gave them all the Details. Most of them would not speak to her so I don't know why but I had the opportunity and they didn't do it.

Now you mentioned Covid before. I did want to bring that up because I thought that that was a pretty crazy time and you were at the forefront of it. You mentioned but it wasn't just in Victoria. There was other states as well that had some of these bizarre rules sometimes where a lawn mowing person couldn't do their job despite the fact that they'd be by themselves and outdoors. It was a pretty crazy period. And you must have seen some significant hurt during that time.

Yeah, well your government was a lot less lunatic than ours, I must say. I mean we had, we had the worst lockdown of any city in, in the world and yet we, our, our death rate from COVID was higher than any other state. So I mean don't get me on about, about our beloved ex premier and chairman Dan, but look, it was stupid, it was really annoying. What, what actually happened, I mean this is a state business. I know but, but what actually happened is that the Department of Health and Human Services, which is the Victorian government department that deals with this, put out a very detailed about a five page statement about healthy living and what you could do, what you couldn't do. And right at the top of it there's independent sole operators can operate safely because they're not in contact with anybody else. You can mow somebody's lawn, you don't have to come within five meters of them, you get paid electronically, there's no reason but contacts I think that was said that was sensible, that was the best advice they had. Then the following Wednesday came out in about Saturday following Wednesday the Premier gets up at a press conference and says yeah but you can't get your lawns motor, your house is clean. Now that's a really interesting statement because what he's doing, he's thinking of his affluent inner suburban elite woke snobby. I can't say too much bad things about people who he relates to all the inner suburban woke greenies and okay, the people that his band club he did not think about 100,000 plus people who were going to lose their livelihood and their jobs. So he just gets up at a press conference and said this. He probably had no idea what his own department had said. But of course being the premier the last thing you could say I've made a mistake. So he just said okay, you're all shut down. It was just outrageous. And you had people, council workers working in groups Doing the same job that we've forbidden to do as individuals. You could people going into a dog salon, mixing with others to get their dog done, but you couldn't have somebody come and do your dog at your place with no personal contact. It was completely senseless. There was no point, there was no medical advice. We took the state government to court, doing a test case and said, okay, you've got your own law says you can't deny a person livelihood without good reason. Okay, what was your reason for shutting down the independent operators? Do you know what their answer is? We don't have to tell you, we don't have to give you any reason. Now guess why they said that? Because they had no reason. There was no medical advice, there was no scientific advice, they had no reason. It was just something that the Premier thought, hey, I can look good if a hundred thousand plus Victorians lose their business, if a few more people commit suicide, what's that to me as long as I look good? Sorry, I'm getting a bit anxious, I'm getting angry again. But it was, it was horrible. I had a young kid, young, in their early 20s, who, who actually committed suicide during one of these lockdowns. And I've seen the distress. I know people personally because I know my franchisees. I know two men who lost their homes, their families, their wives as a direct result of that trauma that went on at that time. I know the hurt that it caused us. And I was talking to frat use on a daily basis. It was disgusting and it was so unnecessary.

Yeah, just a terribly sad and as a sar farcical situation, there's no question about that. Can I ask what the future holds for not necessarily yourself, but for the group, Jim's group. What can we expect? You mentioned tech a couple of times there. I imagine tech is the biggest changer of your business in terms of acquiring customers and how quick you can be in getting back to people, but also how you can monitor how the business as a wider group is going.

Yeah, you're right, tech is huge. The kind of stuff that we do now, you couldn't do without technology. It simply cost too much. We tried in the early stages and it was just terrible. But for example, we have multiple franchisees covering an area and most of them are usually busy. So our system actually allows us to know which franchisee is available. There might be 30 people covering the area and only one is able to do the job. We know who that one is, and it's not just where they work, it's what service they cover what times of day they'll respond to calls. So it's very detailed. There's a whole system involved. The whole business of the customer service is. And surveys. I mean, about 30% of our clients respond to surveys. And those people are gold. They really are. They're so important to us because when we get this feedback by asking people about it, then we can actually find out the problems, we can deal with the issues and we can come about. In the early days of gyms, it was actually quite difficult to find work. We actually had people knocking on doors because we were trying to grow fast. Knocking on doors to try and get customers. You know, last year we knocked back over 200,000 leads. And not only that, but we actually give back money to the franchisee because they put money into the advertising every month, like 150 bucks. Sometimes we can't even spend it because they're so busy year round. We've got about $90,000 in the dogwash account now because they're all flat out booked months ahead and we scored all this money that we can't keep. Yeah. So we've gone back to them and said, what do you want? So we're going to run a conference and stuff. So the difference between the situation where with more advertising for franchisee, we were short of work, the one with less advertising for franchisee, we're actually overloaded with work in so many areas. That's extraordinary and that's, that's the culture of the company, but it's also the technology. And down the track a bit. By within over the next six months, we're going to have a system with a program we use internally called Jim's Jobs, where if a franchisee doesn't actually contact the client within two hours, we get a message back and we can follow and say, what's gone wrong? And we pause their leads. Why aren't you contacting them? What's happened? So we want more and more stuff. We want a system that enables the client to book a job straight into a franchisee's diary. That would be so powerful. So when somebody rings us, they actually, they can actually be given an appointment on the spot because we'll know where they are and we'll know how much time they've got. Technology is fabulous. It really is life changing in terms of what we can do. The changes that you'll see down the track a bit will be magic. And our customer service, our complaints rate, I'm confident within the next couple of years we can see our complaint rate less than half of what it is now.

You're super passionate, we know that. Last question though. How would Jim Penman like to be remembered?

Well, I very much hope that Jim's will survive me. One of the things I would like to do, we're going to start shortly, is put in a contract. The Jim's group can never be sold to anybody. Majority share without the written consent of the majority of franchisees. I really want to make that something that we do because one of the things I fear after I'm gone, somehow my years, which is basically my family will want to sell it and then there's some greedy multinational come along and rip people off blind and just that idea is absolutely appalling. I want Jims to survive with this culture. I have a couple of, I've got a lot of children, I've got a couple of very good potential sons in law too that I'm hoping will take a role. But it's set up in a way that hopefully just continue the culture. So that's very important to me. I've probably gotten about another 20 years to go, but I would hate something to happen after I'm gone. The other thing, even more so is my research project which is understanding the basic the biology of human behavior. And I think we can do incredible things to help people live better lives. And this can affect like Jim's group affects thousands, but this could affect billions. Helping people to overcome problems like drug addiction. I think we understand. I've got a multimillion dollar research project, we spend about $4 million this year looking at the basic research into the effects of mild food restriction and how we can get the benefits of that to cope with things like addiction and obesity and various forms of mental illness and so forth too. I think we have a very, very good chance of doing something very major for the world.

Well, Jim, it's a fascinating story and as you say, a long way still to go. We really appreciate you joining us and all the best for whatever the future holds in that game of racquetball this afternoon.

Thanks, Troy. I'll probably lose though. I'm not that good at racquetball.

Thanks Jim, and I hope you enjoyed our chat. On the Record is produced by the Western Weekender. To hear future episodes and other Western Weekender podcasts, search Western Weekender wherever you listen to podcasts and make sure you hit subscribe and check out westernweekender.com and we will see you next time.