Episode 160: Launching Your Lawn Care Business with Dereck Jenkins

Yeah, no. Oh, no, no. Of course. I get it. Here we go. Get ready in three, two, one. Yes. Okay, good. You're going to be hired. All right, I think that's our intro right there. I don't think we need to talk anymore. You ready to go, Christina?

Okay.

You are listening to the Profit first.

Podcast, episode 160 with my grunting friend, Derek. Let's go.

Profits.

There you go. It's gonna be a good one today.

Welcome, everyone, to the Profit first podcast. I'm your co host, Christina Bolduc.

And I'm Mike McKowitz. And I'm excited again, it took 160 episodes. I found Derek, my blood brother, my grunting compadre. And I'm joined in studio by Kelsey Ayerson.

Hey, everybody.

And oh, by the way, I wrote a book called With Prophet. First it says right here. Mention. Oh, I got a new book coming out too, you know.

I do know.

Yeah, I don't have the title yet. It's the working title. Streamline chapters are done. A meeting with Penguin next week to talk about it. It is. I'm not. The concept is effing amazing. I. My job is to deliver on it. The concept is killer.

Nice.

I love all the people you're interviewing.

Yeah, I had a great interview today with Josh Patrick. The guy is. I'm interviewing literally geniuses in productivity. And it's very cerebral conversations, which you both know, like, there isn't much cerebralism going on. Listen, they little fish are you always facing for confidence?

But no, you are brilliant. I swear.

Michael, please, please throw grapes at me. The. These people are extremely smart. And it is really interesting conversations on how small business can really uplevel and beat big business by doing just a few simple things. So whatever. It's going to be killer.

Yeah, killer.

All right. What do you got for me, Christina?

Know you guys can find us the usual places. Itunes, Stitcher, Tunein Radio, Google Play, and of course, Profit First Podcast dot com. My favorite.

Yeah, you're a big listener of that one. I am on your tap. Amazon tap.

I love my tap.

I love that. A huddle started today with the tap playing. And I love that song. It's that country song.

I don't remember which one was playing.

She talk. It's. It's a female singer. She talks about how she revisits a house where she grew up.

Oh, Miranda Lambert.

Oh, my God, it's beautiful. I love that thing. And let's see what else I gotta talk about.

Do you have a shout out for me?

Oh, I do have A shout out.

That's it.

I didn't load it, though. So I do have a shout out. We started a whole new hotline, and I'm trying to buy time as I find it on this hotline. The number's 844-87-6-7221. Derek, you gotta make sure you call that hotline, too, My brother. This is. Have you heard of the hotline?

I did. I listened to a couple of them this morning, and, yeah, the hotline kind of brings that personal touch to it.

I love it. So we started this hotline. The phone number is 844-876-7221. We ask that any of our listeners listen if you're doing profit first, if your business has become permanently profitable. I don't care if you make a dollar of profit every quarter, you are now permanently profitable every year. Every quarter is throwing money off. We want to hear the shout out. That's a huge accomplishment. 90% of the businesses in the world, small businesses, Never achieve profitability. 99.9% Never achieve quarterly profitability. But we're changing that. We're eradicating entrepreneurial poverty together. And we want to hear your success. Here's the one from Emily.

Hi, my name is Emily Swihart, and my business is AE Photo Film. We're primarily wedding videographers. And since starting Profit First, I have finally been able to put money aside for taxes. I have more than enough operating expenses in my account, and we were able to actually pay ourselves enough money to personally pay off two credit cards. And we are now personally credit card debt free. And it's. This is incredible. Like, I could not have done this on my own. I am permanently profitable.

There you go. Shout out. Shout out to. Yeah, shout out to Emily. Congratulations. Permanent profitability.

That's awesome.

And I actually got a little chill her shouting that out. I think that.

Oh, me too. I have goosebumps right now.

Yeah, well. Cause it's freezing. This.

I know, but it's from Evelyn. So do you want to know what we've been up to or do you have another icebreaker for us?

Next? Icebreaker. What is your favorite piece of clothing that you own? Christina's up first.

Why do I always have to go first?

Didn't you go on? Worst color. You choose brown. Last round. Yeah.

Okay. I went first this morning.

That's true.

Okay, I guess it's my turn. Favorite article of clothing I own, like, ever. Yeah. Or like, out of every. I don't know. I have this one, like, dress from Lularu. It's like a. I'm like, obsessed with that clothing.

I have dresses.

It's so soft.

They look very nice, but on you, they look great.

They're perfect on you, but it's just so soft and comfy. And I realized that I hate wearing pants, so it's my favorite.

Yeah. So you like to be pantless. What's your favorite?

I have this, like, woolen sweater. I'm not really sure where it came from initially, but it was my older sister's, and then she left it in her closet when she went to college, and I just adopted it as my own. But it's the best. It's, like, big, and it has, like. It's from the southwest somewhere, so it has, like, a Aztec design on it.

Nice.

And it's just the best, warmest, comfiest sweater ever.

Nice. Nice. My favorite thing is a Mickey Mouse T shirt that is so battered up, I cut the sleeves off. I use it for the gym now. One of the gym. But I've had it for maybe 15 years. And it's at the point where you got about two more washes left before it just disintegrates. Yeah.

I love them, though.

Yeah.

Those thread bear T shirts are the best.

Yeah. Yeah.

And that's when you can cut it up and make it into a blanket with a bunch of your other old T shirts.

We did that for my son.

Yeah.

Now he has a blanket, which he wears like a cape.

He's 16.

No, no. My older son. Not the young goo.

He's in his 20s.

No. Oh, yeah, yeah, yeah. Could you imagine Jake running around? Oh, I'm Superman. Yeah. Special McQuilt man. I gotta tell you about salad Boy. So we're at an event yesterday, and I'm with this guy, and I'll say real quickly, his name's Jeff Johnson of Technology Marketing Toolkit. We're at this conference, and there's a lunch break. We go out there, and he just starts piling on salad. I'm like, dude, what's going on? Are you Salad Boy? Well, his colleagues are there. They start going, salad boy. So they start calling salad boy. And so instantly, we turn him into a superhero because he's on this big salad kick. So we're like, you know, he's the defender of all salad. And then the joke is like his. You know, every hero has a motto, like, you know, I am here to defend evil. He's here to toss your salad. Was his. I am here to toss your salad. Which is totally inappropriate if, you know, the urban Definition of that. And it just continued to go down this horrible path. And so we made. Now what we did is we. We took a picture of space. We put together a. Did you get the poster printer?

I did.

Okay. Oh, my goodness. We got a poster size thing with Jeff Johnson's face as salad boy, defender of all salad.

That's excellent.

Yeah, no lettuce shall go uneaten or something.

Oh, go untaught.

Yeah, I got a whole other thing I want to do with that, but whatever. We'll talk about that later. Okay. All right, so let's get back to business here. I want to thank our corporate partners to make the show a reality. Ooh, they are here. I'm going to rotate around, so you guys got to pick one. You're up first, Kels.

Nick, Steven.

Oh, that's perfect.

Now receipt bank.

Yep. Oh, Fundera leaves one more fund box. Oh, my God. You're insane. We will talk about all these wonderful companies. We thank them for their support in just a little bit. Now we're getting to the meat and potatoes. We're going to hear from a guy who's been through the profit first process. He's actually used the pumpkin plan, too. His name is Derek Jenkins, and He joined the US army after graduating high school back in 2002. Derek, I want to thank you for your service. He served as an EOD specialist. Christina, what does that mean?

Explosive Ordinance Disposal.

How'd you know that?

Because I'm a genius.

Do you have the thing in front of you, or you just knew that? Yeah. He was an eod, which basically is the bomb squad. Why? Sometimes I emphasize the weirdest things, like.

That'S the bomb squad. You're just so excited.

Yeah, I get so excited. He was in the bomb. Then he wraps up with the military, and he knows he's going to go on his own. He decided to start a lawn care service business back in 2013, and that's what we're going to discuss today. He's got three employees, but it wasn't a simple, easy start. There were some profit challenges, but he's found a way to navigate it. So, Derek, welcome to the show.

Welcome, Derek.

Thanks for having me on.

Do you have a favorite piece of clothing?

I was thinking about that. It's one of those pullover jackets that had the front pouch when we were teenagers.

Like a hoodie.

The ones that Michael Jackson face on the back?

No, not the hoodies, but the. The jacket one that had the.

It's like a windbreaker.

The bigger ones, the big, fluffy ones from the 90s.

Oh, like those, like poncho Y ones?

Never mind.

That's.

I'm gone, I'm done.

Yeah, just. It sounds amazing.

Yeah, it's the U. Like the hippie NFL ones.

Oh, yeah, yeah, yeah, yeah, yeah. Although I, when people throw, I love those. And they would wear like, remember the workout pants that were crazy, like those zany color. Yeah. I would see people wear those jackets that Derek was explaining in those pants. So, Derek, give me. Let's go back to 2013. You're wrapping up with the military. Why did you start, decide to start a lawn care maintenance business?

Well, I, I was a contractor for the military at that point. We had just moved cross country and they cut the contract. And then I moved down a little bit further south to do the same thing, teaching again. And they, I saw the contract was coming to an end and my wife and I decided that, you know, we're staying in, you know, Virginia, we're not leaving. And I was like, I'm not going to get caught without a job again. So I went through and looked at several different jobs that I thought could be scalable. And landscaping was the one that was most interesting and able to be scaled. And so after a long time of writing business plans and working on my bachelor's for business administration, we just went with it. And my wife's like, hey, you got a year. See if you can make it happen. And now we're in, you know, we just turned our third year and we're actually up to seven employees.

Wow.

Nice.

It's, you know, it's been a roller coaster ride, but it's, it's something that I wouldn't, wouldn't, wouldn't trade it for the world.

Okay, so I want to discuss that roller coaster ride in a minute. First, you're in a very competitive market. I mean, you're in Chester, Virginia, which is the Richmond area. Very populated area of Virginia. A beautiful area of Virginia. Yeah. You know, you're going into the heartland of lawn care service. You're not the first guy. There's wasn't competition or is competition a major concern?

You know, it. At the start, I always thought that it would be, but I found that the abundance theory is very true in the landscaping business. And starting out from day one, it was my goal was to be a professional company that was consistent. And a lot of times with the landscaping companies that are startups, they just, they don't act like a big business. And so from day one, we were a big business. I acted like it Even though it was just me, I knew what I wanted to be. You don't act like you are. You act like what you want to become. And eventually we'll get there. And so from day one, we started the website being very professional. We had an employee handbook written before we even had an employee. And so those were the steps that I took to make sure that it made us stand out.

And you said that you start off with a business plan. What's the benefit of the business plan? Why do that?

It's a roadmap, and it's going to help you. If you don't have a goal, if you don't know where you're going, you're never going to get there. And so by having a business plan and just a goal, and I've actually pulled it out recently and looked at it, and we've surpassed everything that I wanted in the first three years. And that just. It gives you benchmarks that you can reach and a roadmap. I mean, it really makes you think about the entire business and how it's going to work.

Okay, so I see as a great planning document. And you said you just pulled it back out. I assume it gets shelved, too, for a period of time or maybe for a long time after you have the plan in place.

Absolutely. Yeah. I found it in my desk when I was moving desks. And going back and looking at it, you can see that you start out somewhere, but eventually you turn. You find that you pick up this book called some pumpkin planter or something and change the way that your model is. You change the way that your direction is going to where you're not trying to expand out everything, you're actually trying to compress into a smaller area. And the business plan initially will get you started, but you have to continually look at it and adjust it so that you can make the best of your business.

So let's talk about the pumpkin plan. It sounds like an amazing book. Let's talk about that. What triggered you to seek out knowledge, be it from any book, was something not going right. Why do you look into new knowledge?

If you're not learning, you're not bettering yourself, and one of our immutable laws is growing or dying. And so as a company and individuals in the company, we want to promote growth within the personal and the business. So I wanted to make sure that I was growing it right. I mean, there's not a lot of aspects of, you know, bomb disposal that you transfer to landscaping.

So how would the dog turds, you.

Know, I had to go somewhere to do it. And so instead of just listening to music while I was out mowing yards, I was listening to books. You know, it started out with podcasts and then it went to books because the podcast didn't give deep enough information. So then I started going into different books and I mean, I've read through or I say read, I led. I listened to a lot of leadership books now because that's my weak spot. I started out with the E. Myth, which one of the quotes that you said in one of your books was when you asked him, you know, do you just go full throttle into working on the business? And I believe he had a very explicit response for you. He did, but it really showed the process of you do need to gradually, as you're growing your business, stop working in it and start working on it so that you can make it better.

So I gotta share a story with Christina and Kelsey. So Michael Gerber. Do you know Michael Gerber? Do you two know him? Alright, so he wrote this book called E. Myth. E Myth is arguably the bible for small business systemization. And he. And he wrote the book, I don't know, Derek, was that back in the 80s with original and then the more recent.

Oh yeah, it was 80s. And then he has specific ones now, even in landscaping.

Yeah. So I mean, this is around, you know, many, many years. It was in the 80s. It could be around like 30, 35 years. Right. And but it is the foundational book you must read. So everyone, including myself, idolizes Michael Gerber. Well, I did a keynote with him. We shared the stage in Mexico. This is back two years ago. And so I'm backstage, I'm like, hey, it's always been an honor to read your stuff face to face. Blows me away. I'd love to have dinner with you. He's like, absolutely. So me, him and his security guard. No kidding. Go to the restaurant. His security guard's guarding the. I don't know, first of all, why you need a security guard?

Could I be your security guard?

You are my security. You didn't know? You actually are my security guard. And so it's me and Michael Gerber. And I say, michael, I got it. I'm writing a new book called the Pumpkin Plan, which he subsequently endorsed. I said, I gotta just ask you. I think there's one thing I don't like about the E. Myth. I want to ask you about this. In the E. Myth, you say, don't work in the business, work on the business. But the interpretation is it's a switch, like, today, stop working in the business, and tomorrow start working on it. I think it's more of a dial. Like, you have to build toward that. What's your thought about that? And he looks me right in the eye and he goes, eh, fuck you. Right? Which I know sounds very offensive, but it's total Michael Gerber. And it's funny, but he was also serious at the same time. And then he went on to explain why his logic's the way it is. So that's what Derek was resorting to. And it wasn't what he expected, but it was kind of fun.

Yeah.

Yeah.

In retrospect, it's very funny. And let me say, I adore Michael Gerber. He bought dinner or did the security guard.

You'll never know.

Yeah. So, okay, so, Derek, you start studying things to do. What was the challenge? What was the big first roadblock you faced in your business? Something maybe, that you felt like, I'm not gonna get past this.

It was employee development and then learning how to say no to jobs. Yeah, it was hard. We were doing random stuff that, you know, now I'm like, I went on a tangent this year, and my. My new office manager, she's like, what are you talking about? And I just went on this complete tangent about, we are in the maintenance business, nothing else. We're in the maintenance business. We're not picking up trash. We're not, you know, moving plants. We're not installing them. We are right now focused on maintenance. And I just. I kept going on this tangent for, like, five minutes to get it through my head to stop taking all these random jobs and focus on what our. Our sweet spot is.

Yeah, but listen, you're. You're out there. If you're mowing my lawn, you can throw a plant in. Why not make the quick 50 bucks?

Well, you got to look at the long term of. Okay, now I've got to go back, get the plant, get the soil to put in with it, return to the job site, and then install it, and you've got it. And you can't just have. If you haven't trained your guys, it's one more thing that you've got to train them on, as opposed to training them on specific tools on how to do it. The same way every time, you know, yard after yard, you're switching up what your sweet spot is. And, yeah, if you. If we know that we're going out there and it's a complete maintenance contract, then. And they ask us to put something in. Sure. But not Right. Then you've got. It's got to be planned out. Next time we come, we'll bring the plan and put it in. Not, you know, immediate.

So you're not just my grandfather, you're my soulmate. I love that focus. That's incredible. But what about the risk of losing work if I. If you tell that customer, no, we're not going to do it. We are a maintenance business. You're gonna start turning customers away. Is there. I assume there might be a consequence, but emotionally, that must have been tough to say that the first time and the second and the third time.

It is. And even now, I mean, this year, instead of trying, because we had this huge growth with one contract, we decided we're not gonna take any more customers because I didn't have the right team in place. And so instead of trying to over expand ourselves with more work and the quality of the work going down, we actually started. We haven't taken a new customer in about three months because we wanted to have consistency with all of our current employee clients. And they know that it's going to be done right at the right time.

I got you. So what I hear is by being focused, you start bringing a consistent product, I assume your reputation starts to actually improve it.

You know, when we first started saying no, and then we actually, we did some pumpkin planning and cut customers that were not as profitable. And unfortunately, it was a business aspect. We got a little bit of kickback, but at the same time, as soon as we're ready and we're wanting to, I'm going to just blast everyone with our current clients and say, hey, we need your help. We're ready to grow. We need some reviews online. And then it's going to mute out every negative comment. You know, we had all of three. Three that actually took the time to say something. But it's going to mute out all the negative comments, and it's going to show that we have a consistent base that we're going off of. Everyone's heard the term it's cheaper to keep a client than it is to get a new one. So why not?

Totally. But what about the effect of profitability when you started saying no to the wrong clients? It still sounds like even a wrong client brings in revenue. Did. Did your profitability drop?

No, it increased because.

Nice. Nice.

Because we were, you know, one of the biggest things that we did was I actually handed off about $10,000 in revenue to another landscaping company. And I told him. I was like. I was like, we are going to be Centralizing in Chester so that we can provide the best service to Chester. And I told him, I was like, you know, right now, these are the clients that I have outside of it that your area is in. And we've sent customers to him. But at the same time, he knows that the abundance theory is there's more than enough work to go around. So by me showing him, okay, yeah, you're still going to be a competitor, and I'm obviously going to pick which ones I send you. There's no reason that I can't help you out with your business. And in return, we get a reputation of the company is, you know, professional. We try to benefit everyone that comes in contact with our company. That includes the employees, the clients, the suppliers, everyone.

Did that guy that you start referring business to, I mean, some 10 grand a business, does he look at you and go, what's your hidden agenda, pal? I mean, he must be suspicious. No one does that.

No, he. Because I told him up front, you know, I told him up front that what I'm doing is I'm centralizing in Chester so that I can, you know, so we're not driving around. But he had a lot of clients up in. Up in the other area. And I made sure to contact my clients and said, hey, this is what I'm doing. This is why I'm doing it. I've already vetted, you know, someone else to replace us, and I want to introduce you to them. Would you like that introduction? So not only did I keep a good reputation with the customers so that if they, you know, when we do expand out there next year again, they're going to see that we were professional already. And I can, you know, I didn't just leave them hanging or just cut them out for no reason. I explained what we were doing so that we can become a better business.

I want to get a sense for the financial consequences to you. I mean, I can't tell right now if your business has just been doing solidly well all the time or did you go through some financial struggles? Were there lean times in this business?

You know, with the major growth that we had, we're actually just now coming out of a crisis mode for the profits and for the entire cash flow. Because, you know, the first year I was like, okay, no one wants to pay all the time, leaving cash. So one of the things we did was made it to where they could pay online. Well, nice. Some people were. You know, when you tell a landscaper, you know, when you have all these random landscapers, they're like, well, the last one, I just left 20 bucks underneath the mat. Or I left the check in the mailbox. I'm like, no, we don't do that. We. We have an online portal that you're gonna get a username and password to. And then that right there just sparked the. Wow. This is more of a professional organization than, you know, having our guys just pick up 20 bucks underneath. Because then. So from the get go, you know, we tried to make it as easy for the customer and as professional as we could.

Okay, but let's talk about the finance. You said you went through a cash crisis.

So one of the before. Because I think. I think the first time I contacted you was probably about, what, six, seven months ago, and I said, hey, profit first. We're doing it. And the first time I drew the profit, it was right at the end of the quarter, and it was like $101. And I told my wife, I was like, we're trying something different. Here's 100 bucks for the house on top of what we normally get. And then I took that $1 and I put it behind our sign that has the first dollar we made. And I said, you know, this is the profit dollar.

Oh, dude, send us that picture.

And it's one of those things where.

Send us the picture again. Did you send us the picture of that?

Yeah, I sent you a picture of it. It's. It's.

Jesus. Kelsey reminded me. Do we have it hanging? I know you can't stop me. Is it hanging up on our whole wall? I think it is.

It's up there.

Okay, we have the picture hanging up.

Okay, so it's.

I gotta go outside and look at it.

It changed the way I looked at it. And then, you know, I listened to the profit first and tried to get everything straight. And then, you know, lo and behold, you come out with a second version of it. And the biggest thing that I got from it was, you know, I missed some. Some key points for profit first. And one of them was when you're starting out and you have your profit account, the half that you're supposed to be taking home as profit should be going to paying off your debt so that you can make a bigger profit later on.

That's right, brother.

And so, you know, that's one of the things that we've been doing is we've been consolidating and making sure that we're not overspending and not just throwing money out there. We want to make sure that we're using our Money appropriately and having good equipment as opposed to just crappy equipment. But at the same time, we're taking that profit that we should be taking home and putting it towards the business so that we can not kick back, not push back into the company, but paying off all the debt so that as we move forward and we expand, we have the cash to back up any emergencies. But also, once all that debt's gone, that huge payment that we've been making towards our debt is now going to be profit towards my family to where I can, you know, we can go out and do stuff. And that's, you know, I tell everyone that the whole reason that we're doing that we come into work is to provide better for our families.

For sure. For sure.

And so it's, you know, that's, that was one of the biggest things that I missed in the first part was that you need to pay off your debt with that profit before you start taking a bunch of it.

Right? So with your wife and your family, you bring home $100. What was your wife's impression when you had that first profit distribution? $101.

She was, she was kind of confused because it didn't sounds like, you know, she, she was like, what do you mean? You're just taking, you know, you're taking a profit. You know, we already get paid. I was like, well, this is a little bit different. And she, she's, you know, she's in a, she's got her msw, so she's in the social work aspect of it, whereas I'm trying to expand into this business world. And it didn't, you know, she just trusts that, okay, you're doing your own lessons. You're learning, you're expanding on your own thing. I don't care about all the details. Just, you know, make sure we get a check every month, you know, every month. And, you know, that's how it went. And so as we've been progressing and of, you know, profits coming in, we're seeing a little bit of it, but not, not as much as we can once everything's paid off.

Okay, so you're, you're using your profit appropriately to eradicate debt in the business and in your. Any personal debt you have.

Right, Correct.

Good, good. And that's how profit first works. You know, our personal lives and our business is so intertwined.

Right.

That's how it works. Do you feel a reward or do you feel excited every time you, I mean, I know you're, you're maintaining your debt or trying to pay it down regularly. But when the profit distribution comes out quarterly and it hits the debt even harder, how does that make you feel?

It's, it's nice to know that eventually I won't just be, you know, putting that money towards the debt. It's nice to know that hopefully that, you know, well, eventually the payment will be going to me as opposed to, you know, the creditors. And, and it is pretty exciting to actually, you know, write that check to pay off whatever I can.

The profit distribution, you said the first time was $101. What's your most recent profit distribution at?

Right now we're, I don't even. We're adjusting all the percentages because like I said, when your second book came out, that's when I had to adjust everything because I'm trying to figure out the taxes and everything else to adjust it. So we're trying to get around 5 to 6% profit, but that's, you know, that's on top of the expansion that we've been doing and paying and it's the profit. 2.0 is what I'm calling it.

Yeah, but give me the cash. Like next profit distribution you take how much you took 101 bucks the first time. Is it going to be $110? What do you think it's going to be? I mean, you should know it's piling up in there.

You know, I mean we've been paying out probably about $2,000 in Bazinga.

That's what I wanted to hear, my brother, two GS.

So it's, I mean it's getting there, but it could get better.

Oh, now he's getting cocky. Now he's getting cocky. The guy's getting two grand a quarter. It's every 90 days he gets a two grand bonus. Yeah, and I know it's still going to pay a debt, Derek, but you're right. Like you said, there's that day when the debt's gone and that full $2,000 goes into your pocket and that's enough. You know, for vacation. Maybe not in Chester, Virginia, but you can go somewhere.

What would you vacation in Chester?

Chester is expensive as hell.

You've been to Chester?

Oh, you do live there. It's just a staycation. It is an expensive town. Yeah. Which is smart. I mean, Chester is an affluent area. I assume that means affluent customers.

We do have select areas. We're going to try to expand a little bit further north towards the east side of Richmond. And that's where it really starts getting to where you're like ridiculous lifestyles.

But they just add. It used to be called rich man and they add the deeds just to make it a little more common. Like rich man.

Yeah, Richmond.

It's the story. That's the story. It's made up. Okay, so with Private first, where have you struggled? Like you've, you've implemented it, you're making a profit. Are you paying, by the way, are you paying yourself more than ever before?

We, I've been paying myself. I set a, you know, when we started out, we knew what I was making and we knew what we needed to make to survive. So we've always made that amount and then going on to it, you know, that's the amount that we take on a bi weekly basis every, you know, doesn't matter what the business does. And then for our, for our taxes, one of the things that we're trying to figure out is on this 15% for taxes is, you know, I have my set amount that we, that we're going to take home and then the taxes are on top of that. So even though, you know, our specific amount is one thing, that's what we always take home. So our taxes are paid by the company just like it's supposed to be.

Great. So the business is paying your taxes. That's perfect profit first. You're more profitable than ever and it's growing. That's perfect profit first. You have a consistent salary and your lifestyle is adjusted to that salary. Perfect. But now my last concern is the expenses. You said you grew faster and then the expenses started getting crazy. Tell me about that.

We had, we, we acquired a hoa. Full maintenance. I mean, you're talking homeowners association.

Oh, okay.

So 125 homes that we maintain on a weekly basis with mowing, trimming, blowing. And then you also have the mulch install, you have the shrub trimming. Everything is included. And then we got snow plowing in the winter. So it's a huge contract. Well, what happened was we had to get a lot of equipment, you know, so we had to, you know, we spent a lot of money on, on snow removal equipment. Well, normally it snows like three or four times. It only snowed one time this year, so it didn't even, you know, so that was a, that was a hard hit for us. But we also had to get, you know, two more mowers that cost $10,000 each. Then you have the increased payroll of, you know, acquiring good employees because we don't, you know, I feel like if you are working hard, you should not Be at minimum wage or even close to it. So I pay my guys accordingly. And you know, our average education level in our company for a landscaping company, it's is a bachelor's. That's the average education for your company?

Really?

For my company? Right now we have one guy that has a master's in music entertainment. We have another guy that has his bachelor's in history. I'm just about ready to finish up my. My bachelor's in environmental science.

So hold on. You guys have a guy has a master's in history. Does he go to someone's property in entertainment? Oh, I think you have someone with a master's in history.

No. Bachelor's in history.

Bachelor's. Okay, so he's not. He's not as educated, but still. So I could see him. Like, does he go to the property and say, you know, back in 1772, on this property, George Washington got in the fist fight? I mean, does like. Like, why. Why These people are highly educated. Include the bachelors. I mean, highly educated. Does it apply to what they're doing? Oh, no.

Yeah, Absolutely. No. The. And part of the growth that we're talking about when we talk about our immutable laws, is growth of the individual. So the one that has the masters in music entertainment, he used to play on a cruise ship. And so he's actually started his own business that he's working on outside of our company. But one of our values is you're either growing or dying. So I know that I've got about a year and a half to two years with this guy, and he knows that I'm supportive of him growing. So with that. That mutual understanding, he is one. One hell of a worker, and he knows that I am supporting him and everything that he's doing outside of it.

Okay, so that's pretty cool. So you know that your employees. This is an interim step for them, but it's also a growth opportunity. How's a guy that has a. I assume he's going to a music career of some sort, you know, is he. How's he. How's lawn care even relate to that? How are you supporting him?

It doesn't.

It doesn't directly, but it's providing the means for him to start up his own company. And it's a nightlife type of job. I mean, he's trying to start a jazz club. So by me, I've even told him I was like, the first book you're reading is Profit First. And he's like, what?

He's educated. He should Say, of course.

And so, you know, I want to encourage these guys, and that's by doing that, you get better workers.

So you're really. You're an entrepreneurial incubator. Like you're teaching a guy how to run a lawn care business, which will translate to running a jazz business.

Sure. And one of the other things is that if I can't provide a growth place for them, then I'm going to encourage them to grow outside of the company. But ideally, I want them to stay with the company and grow with us, and we plan for that. You know, I ask them on a regular basis, what do you want to do? And then I try to provide that growth within our company to keep me here.

What's your future plans for Chesterfield Lawn Services? Where are you going to take the business, profitability wise, and how are you going to do it?

So profitability wise, I want to get to where we're at least at 10 to 12%. I want to hear you. Now we're at 6%, 5 or 6%. And that's. We've been getting to where we're. We're almost down to the square footage of. And I know that you work with. And here's a shout out for Dirt Monkey University.

Yes.

I've looked at him. Yep. I've looked into some of the stuff that he has, and this winter I want to go through some of his university stuff. But I want to. I want to increase the profitability and the consistency of the profits so that we can expand from the maintenance side to the landscaping side so that when they do ask, hey, can we put in this bush? We know exactly how much it's going to cost and how much profit we're going to make from putting in that bush. And so it's getting down to the numbers of exactly how much it costs, you know, and knowing that when I give them a price, it will be profitable.

And when do you think you're gonna get that 12 to 15% profitability?

I'm hoping by the end of next year.

By the end of next year. Okay. We'll hold you accountable to that. We got a rock and roll. Derek. Hey, there could be someone in Chester, Chesterfield in Richmond that could use your services right now. How can they find out more about you? Chesterlawn.com Chesterlawn.com we'll have that in the show notes. You're on Facebook and Twitter. We have all that in the show notes, too. Yep. All right, brother. Thanks for joining us today, Derek.

Thank you.

All right, I gotta hit there we go.

I just love him too.

I love him. I love hearing someone that is. Is looking at profitability and then reverse engineering the business around that. He's like, I want to hit 15% and to do that, I need to do this. Do this. And he's figuring out the steps in reverse sequence. That's exactly. I guarantee he'll hit it.

Yep.

I guarantee he'll hit it. He was cool.

That's cool.

Yeah.

Okay, here's what else is cool. What else? My notes. I have tons of notes and I have a funny joke I gotta get to, but I don't know if I'm gonna be able to build it. Right.

Will it be funny to us or only you?

No.

Well, that's important.

I love that you cut me down every time. Keeps my ego in check. I. I think it'll be funny to you. It's a. It's a joke about jazz. Jazz musicians versus rock musicians, Remember? Remind me to talk about. Okay, okay, sorry. So we're gonna have that funny joke. Maybe we'll embed it in the partner section so people don't fast forward to that. But we're also going to do a recap of what we learned.

Yes.

And then we're gonna, you know, do our goodbyes. So first let's talk about our partners.

Yes.

Give me, give me two or three now. Awesome. I'll insert the joke somewhere in there.

Oh, okay. Fundera.

Fundera. Next.

Diva.

Well, no, no, no. Let me explain what they do.

Oh, well, okay.

Explain it.

Fundera.

Let me, let me explain. So. Which is awfully close to Spillet splain dangerous. Fundera is a one stop shop for loan services. Now listen, Derek was saying, you know, his business grew, he needed to buy his equipment. He secured the contract with that homeowners association HOA now. And he need to buy equipment. He may not have the cash. Fundera will find loans for that. And Fundera is not the loan source. They shop it out and they come back and say, you know, Derek, you should go to so and so. Or you can choose option, you know, A, B, C or D. And they'll find like 20 or 30 loans. And they do it within 24 hours typically. And then they educate you on which alone is the best option.

What about Fundbox?

Great. I'm happy you asked because that reminds me of a joke. So what's the difference between a jazz musician musician and a rock musician?

I don't know.

Please tell us.

A rock musician plays three chords in front of millions of people. A jazz musician plays millions of chords in front of three people.

Oh, that's terrible.

But it's the reality, okay? That was the struggle.

So now I'm laughing at how bad it is.

What, are you kidding me? That was genius. Who was the next sponsor?

Fun Box.

Oh, Fun Box. Cash Flow Accelerator. Listen, if you're going to open listen, you got three guests coming to your jazz studio there only you may need Jazz club. Yeah. First of all, you shouldn't call it Jazz Studio. You should call it Jazz Club. Tip number one. Tip two is they may not pay you on time. Fundbox is a cash flow accelerator. They give you the money in advance of a customer paying. If your customers aren't paying quickly, Fundbox will. What about Nextiva VoiceOver IP phone system? I think the best. I think it's the best. We, we do have to upgrade our router, which I got at Walmart four years ago, and we so many phones running through it that it's causing problems.

That's true.

And I called Next Step and they said, I said, you know, the phone's kind of getting a little spotty at times. Like, tell us about the router you have. I'm like, you know, it's, you know, It's a Walmart 1000. He goes, what? He goes, where'd you get that? I'm like, walmart? He goes, yeah, we're not spec'd for that. We don't. We're surprised. Any phone system could run over it. Like, well, well, we found a way to run like 25 phones over it, so it works pretty well. But now we want to get the 26th phone. We have to upgrade that router. But they're amazing.

Makes sense.

Voice over IP phone system. Affordable, reliable, amazing features. We use it to record calls. You can do anything that the most advanced phone systems do. All over the wire.

What about Receipt Bank?

That reminds me of a joke. No. Receipt bank is a way to scan in your receipts right to your accounting system. So no longer do that big receipt box. You know, if, if Derek is out doing a job and he buys something specific for a client, maybe he's got to buy flowers or some other shrubbery. He can take a picture of his receipt, scan it in, and link it to the job specifically so he can see if he's profitable or not per job. That's all the power of Receipt Bank. It's amazing.

Amazing.

Basic. All right, what'd you learn today? Somebody.

I'm just amazed at how calm Derek is through everything. I mean, you know, he talks about the abundance theory and Having true faith in that, which I think is amazing. And something that we all need to kind of remind ourselves that the work is always going to be there. You just have to find it. Listen to books versus music. I love that. I never. I'm always saying I don't have enough time to read and I'm like, oh, I should just start listening to books. No brainer.

Yeah.

And to keep a good rep with your customers. Just be a good fricking person.

Yeah. He's a guy.

Be a good business owner.

You know why so calm is because he is an eod. The Explosive Ordinance Disposer guy.

Yeah, yeah.

Could you imagine? He's a nervous wreck, like, all the time. Like, I have the mo. Lawns. Oh, my God. He. I would not want that guy handling explosives. I want a guy like him, like, totally chill. Would you get what you want? That's good. This is funny stuff. Hilarious.

You should be a comedian.

I got one more joke. All right, what do you got?

No, Overall, I just applaud Derek for having integrity every step of the way and having faith in himself and his ability to adapt as he goes along. Yeah. All around. I just love that he has stuck to the pumpkin plan. Kind of finding his sweet spot like he said and sticking to it. And it's super hard, and I feel like he's doing it really effectively.

You know, we're recording this at 1:00 clock in the afternoon. This is prime time for lawn maintenance.

Yeah.

And he's chill. He's on the phone. He's not, you know, this is midweek. He's not out there doing it. This is clearly a person that's devoting a portion of his time to work on his business. Oh, I gotta talk about Lori Peterson a little bit. Because Lori Peterson is a PfP who specifically works with lawn care service companies and helps make more profitable. Here's what I learned. He's constantly learning. You guys mentioned that. Act like you want. Act like the person you want to become. He said, I love that.

Yeah. Not who you are.

Exactly. He said, I'm reading leadership books because that's my weak spot. You know, people ask me, Mike, what book should I read next? And I'm like, oh, private first. Like, no, don't read. I hate to say it. Don't read those books. If that's not your problem, what's the imminent weakness or challenge you're facing? Read that book. So if you're not profitable first. But if you have a leadership challenge, read a great leadership book. So I thought that was Pretty amazing. And the other thing, he didn't say his words, but this is what I interpreted. He said during the interview, he got some negative comments, and they caused a distraction. I think one challenge business have is they think that a few negative comments is representative of their entire business, and they respond to the absolute minority when they're. They ignore the majority. And that's the problem. You can't be distracted by the few negative naysayers who are having bad days. You gotta stay on course. Now, if a lot of people are having bad times, then you gotta fix that. Oh, and I have a new job for you. I do need you as a guard for me. Okay. A voice guard. I say some stupid things. I'm like, oh, you gotta send me that dollar bill picture. And you're like, no, no, he already sent it. Don't be an idiot. I need you, like, guarding me. So before I say anything, I'll just, like, do a hand wave. And then you got to think what I'm about to say, because you basically know, be something stupid.

You have to read, like, just.

Just do the kill signal.

Just figure out how to be telepathic.

And then you don't even have to just do every time, do the kill signal. Just go, don't. Don't talk. And basically, I'll be protected. So be my voice guard.

You know what else I like to. Just real quick, one thing. Another thing that he said was to invest in the employees that, you know, are keepers.

Yeah.

Like, I mean, he knows that, you know, his business, they may not stick around forever, but he is. Even though it may not be beneficial to him, he is making maneuvers so that they're comfort and they want to stay as long as possible, which is.

Like, no question about it. And he's hiring professionals. You know, we have a lawn care guy comes by, and I don't know if he's hiring professionals like this because of how they act. Smoking cigarettes, they throw it on the ground. You know, the proper maintaining. And I don't think they're even trying to be disrespectful or they're just not thinking at a professional level. They're not thinking, like, if this was their business, what would they want done?

Right.

That's what he's doing. All right.

Oh, yeah, yeah.

He's a grunter.

He is a grunter. I hope you recorded it. You can play it for every episode. So we want to know what you Learned. Go to profitfirstpodcast.com or iTunes or Stitcher. Wherever you're listening to us. I want to know what your takeaway was.

And here's the thing. I want to know. Why don't you have a profit first professional already guiding you? Why? Why, why?

Why?

You need a profit first professional.

Like Laurie Peterson.

Like Laurie Peterson, exactly. Laura Peterson's a great example. So Laurie Peterson not only does bookkeeping services for businesses which you need a bookkeeper. Anyway, she's certified at the mastery level of profit first. Means she's one of the elite providers of profit first. And she specialized in lawn care service companies. So she knows the equipment they need. She knows the way they approach the business. She knows the problems are going to face before they have the problems. But we have. I mean, now we're talking hundreds of people as we're growing that specialize in different verticals. We don't hook you up with, oh, we have someone in Chester. They're good. We say we got the world's best provider in profit first for lawn care service. Her name's Lori Peterson. Let's make an introduction. We can find that person for you no matter what industry you're in.

Yeah.

You take the first step to go. First step. Go Whatever that is. You take the first step, though. Go to profit first professionals dot com. Click on the find button, fill out the form, we'll make an introduction and your office of races. Again, go to private first professionals dot com. Fill out the form after you click on find a Prof. First professional and we'll hook you up. That's all I got.

Kaboom.

It's absolutely. Why don't you say stuff like that? Is that so funny? But you just give me the visual. She's made fun of me, but cute. Okay. All right. Let's get out of here, my friends.

Okay, bye, everybody.

It.