$300K+ in DEBT (and he bought a $140K TRUCK!!!)

Tell me the story about the F450. I'm very afraid. I'm honestly freaked out for him. Why did we get a $120,000 truck?

I'm gonna kind of open up. You know, we can post this or we can't. You know, however you guys take it.

It's been tough working with some of the guys on the team. They're both constantly late to work. They're just being inconsistent not showing up for work. So 15, 20 minutes, and the dispatch manager waiting on these guys to start the day, giving me pushback. If I ask them to do something, it's always like, why?

Sometimes I may tend to throw too much on the trainees. One of our employees hit a car parked outside of our alley back here. Stop.

You know, I was addicted to hardcore drugs.

As of now, going forward, I'm really going to be raising the prices on these smaller jobs. It's really just wasting time.

Ended up damaging the side of the truck. He hit a stop sign.

Typically comes down to this where people have maybe a misunderstanding of how the surges are getting carried out.

Just want to show you that we work in the rain too.

One of my guys slept in. He's not here on time. The crew already left out. I'm gonna let him go. I don't like firing guys.

I look at the company, I'm like, we gotta do some, you know, serious surgery. There's no cash, and the business dies.

Ready to get after it?

Yeah.

All right, cool.

60% of businesses will fail in their first three years. I'm Mike Andes, and I'm on a mission to fix this. I know the fear, and I felt their pain. For the next 30 days, these owners will be sweating it out while trying to avoid becoming another statistic on this season of business boot camp. First, we're going to start in Tacoma, Washington, where Dylan is the owner of a small lawn care and landscaping business. In just its second year of operation, but it's already grown to almost 400,000 in annual revenue. But now he's struggling to get out of the field and grow the business.

Getting geared up. Day one of the 30 day business boot camp. I'm out here in our shop, aka my garage. Nothing too fancy, but this is what we're working with. One day, I hope to have a dedicated shop space away from our house.

It's getting worse as we get more new neighbors over here.

I do feel that we're starting to. Starting to outgrow the space a bit. So you can kind of see that this is Open parking out here on our street with some trucks and a dump trailer. We're starting to monopolize the space out here. Don't think the neighbors probably appreciate it too much. That's one of those things I was looking forward to talking to Mike about is when we might be able to afford a new shop space and what that might look like for us. My. A couple of my neighbors aren't super happy with me running the business. That wasn't an issue. And I did zero turn. And since then, there's been some events that are making me feel like I got to get out of the house or at least at a minimum, if I add another truck, I need to find a new place for it.

You have plenty of capital. You don't need to buy the trucks now. You don't need to buy anything now. Obviously later this month when you start thinking about shop space, that's 100% something that's very important. Based on what the media guys have told me about backing up trucks and out of your driveway and all this other stuff, we have to get that taken.

Don't get me started on that.

So we'll figure that later in the.

Month you guys may start to learn about me that I could be a little bit forgetful. So I'm either losing my lunchbox or my cup of coffee. So before the crew gets here, I'm looking for my lunchbox. Yesterday we hired. It was the first day for a new employee. Her name is Bri. Let's take a peek at this property. We are on the second house of the day with our new new hire. So far, so good. I have a. I have a pretty good optimistic feeling about how. How it's working out. I usually try to make a little bit of noise just in case there's pets.

I don't know.

Did I tell you?

I don't think I told you this, but a couple weeks ago I got chased out of someone's yard and I had to jump the fence. It was a six foot fence. I jumped over it because the dog started chasing me. I was like a pit bull. Now I make noise so I can find out if there's pets in the backyard. But, you know, attention to details, making sure she's not missing spots. She's coming in without a lot of landscaping experience. She does have experience in the construction trades, so she's no stranger to hard work and getting out here and getting after it. My goal is to get every person within about a month of working with us to feel like they can lead Any job, whether it's going on a mowing route on their own or whether it's ripping out someone's sod and replacing it right, we'll just keep chugging along, trying to make it a good place to work, offering good training and also just keeping a positive culture.

My concern is more a matter of the, the work life balance, the amount of hours you're working and the fact that, that it's just not sustainable because you know you have $150,000 in the bank. I think if you spent 40 to 50 of that strategically between now and spring rush, it will set up the business to be able to go up to that 9 to 100,000 marker and have a general manager in place and give you a little more flexibility.

So today we actually had and I drive fast and brake hard just to get used to it. We're actually doing a training for driving our trailer.

Stop. This is a lot of stress to have on somebody.

Here's my truck.

As much as I want to be like, hey, like let's focus on growing the business. I look at the business, I'm like, there's some serious surgery, like I said, that needs to be done.

That might just be the name of the game, you know.

Next up, we're going to Arizona. And yes, landscaping even happens there. Aaron is the owner of a business that has grown massively over the past 12 months. And now he has multiple crews gonna do eight, nine.

However, with that size of business, he literally has less than $2,000 in the bank account. And I am extremely concerned by the fact that he has hundreds of thousands of dollars in debt and equipment and trucks. And this is a very scary situation.

Hey, what's up guys? This is Aaron with Arizona Yard Maintenance. You know, we're talking about struggles. One thing that I know is taking away from my profits every day is going to stores like this Circle K, quick trip. Every morning. I'm at right now, my six year old stepdaughter has brain cancer.

So, oh no.

I have a daily ritual of going to Starbucks. When I first started out, I went to McDonald's daily. And then when I made more money, I upgraded to Starbucks. I just got my coffee. You hear my voice kind of chipper. It's what coffee does. When I first started my business, I was making very little money. I was in a very bad spot mentally. I was rough. About five years ago, this was before my daughter was born. I'm going to kind of open up, you know, I was addicted to hardcore drugs, methamphetamine Pain pills. I could not get out of it. Tried to get out of it. It was miserable. I still had my mind partially. Yeah, I was still smart, but that truly is a disease. Ultimately I found, found some help. I knew I had a daughter on the way. I knew I wasn't a dirtbag.

I'm here with my daughter right now.

This is Lily. Lily, how old are you?

Five.

She's five years old. These are my two daughters, Tina and Lily. They are wearing their custom shirts. Here's a picture of me, my mascot. Had an artist create this for me. Here's Lily.

Here's her custom shirt.

Say smile, Lily. My daughter was something powerful to give me the strength to quit. One thing I did is I went to McDonald's every day. I got oatmeal coffee and I would drive around and have self affirmation talks with myself. I would, you know, look in the mirror, tell myself I could do it. I'm powerful, I'm not gonna be taken down, whatever. I had to tell myself I was going to overcome it. I had to for this innocent child. And now I have all this responsibility, you know, family. I have eight to 10. Other guys rely on me. I have a purpose now.

When I look at a company that is struggling, it's like, okay, first and foremost, we need to stay alive. Then we can focus on, you know, thriving and growing profits, et cetera. Like in the short, short term when you only have 2,000 in cash, but there's, you know, almost 300,000 in liabilities, that's very scary. And I know what it's like to be there. And so I don't, I made sure I don't want you to think I'm talking down you in this call at all. Because like, I remember what it's like to be there and it's like horrible. And especially with that compounded with the fact that your, your, your, your daughter's like going through everything. Like, I can only imagine the stress and everything.

I know that a lot of my money has been going towards like personal expenses, like lawyer fees. I had a surgery done, you know, that was like $10,000. So, you know, I've, I've spent a lot of the businesses money on personal stuff. Probably have like around $100,000 saved up if I didn't spend it on like personal stuff.

When I'm thinking about very short term, I immediately am looking at the balance sheet. That's where we can cut fastest the debt, right? So, for example, we owe 122,000 on the F450, 20, 22. What's the payments on that per month?

Just over 1700.

And then we got like the boom lift. There's 36,000 on that. So do you know what the payment is on that per month?

800.

The RAV4, I'm assuming, is that used for the business or is that personal?

Mostly personal.

The two thing I'm looking at the most right now is the RAV4 in the truck. So on. On the. On the wood chipper, there's a $73,000 loan. What's that per month right now, do you know?

1500.

So right now we're sitting at around probably $5,000 a month in payments. Is that about right? Five to six thousand.

Yeah. Yeah.

Tell me the story about the F450. Why did we get $120,000 truck? I'm just asking.

I know. You know. T. Gr I joined goat gang last year in December.

I invited everyone from Goat Gang 66.

The greatest of all time are here to compete for this thing.

Who's gonna take it home?

Boys went to the competitions, Got close to winning some of them. Before that, I won the excavator competition. I picked up an egg, you know, without breaking it, the fastest.

Let's see what you got, hot shot. 109, 104.

T. Grand and I worked out a deal. He still needed the excavator. I ended up getting $54,000.

To the winner.

Congratulations, Aaron from arizona. Here are the keys, brother.

Thank you.

$75,000 excavator.

Congratulations.

Thanks, brother.

Take this thing home. All the way to arizona. Let's go.

I'm taking it home right now. That same weekend, there was another competition. And I got second place for 20, 21F450. Almost won that truck. They're nice trucks, you know, But I had all this, you know, I had $54,000. I had that. That extra money I considered a free money. And I just decided to put, you know, $30,000 down and get that truck.

But if you run out of oxygen, the cash in your business, the business gets killed. It's whacked. Your one big job that doesn't pay on time, Away from, like, a really very stressful moment.

It's been tough working with some of the guys on the team. He bails on work frequently. They're just being inconsistent. I'm gonna let him go. I don't like firing guys.

Next we're gonna be paying a visit to david, who is the owner of headband movers, A moving company that is struggling to find work in the middle of the month and to book their cruise out into the future. But more importantly, find crew members that want to stay in an industry where the turnover is extreme, extremely high.

I started headband movers in 2020 during the pandemic. We've been operating for about two and a half years now. I was laid off from my job in San Francisco. I was out there going to school, using my GI bill and working at a tech startup. Decided to come back to Denver and start a company. This week's a busy week. We got jobs every single day. We have big jobs, we have small jobs. My morning routine, I usually get to the office around 6aM Respond to emails, check some things off my checklist, and just get ready for the day.

So we're on a job right now.

One bedroom apartment.

I'm going to wrap up all the furniture. Got one of the guys pushing boxes. I usually get the smaller stuff first, especially like the boxes and get those into the truck. Stack everything high and tight. We're going to wrap most of this furniture for the customer. Got a small bed desk, so should.

Be a pretty quick job.

One of my guys billed last minute, so I actually had to fill in for him because I couldn't find a replacement in time. Ended up having to cancel some meetings. Wasn't able to get caught up with my leads. Unfortunately, he bails on work frequently. A little bit frustrated with him to talk to him tomorrow.

In terms of the frustration side of things, is this them showing up? Is it sloppy work? Is it not fast enough? What's kind of the frustration right now.

With these two guys? It's, they're both constantly late to work.

Right.

So 15, 20 minutes. So then the entire crew and the dispatch manager are waiting on these guys to start the day and then trolling me inside the team chat, not following policy, uploading when they're supposed to be uploading. And then if I ask them to do something, it's always like, why? Instead of just doing what they're supposed to be doing, they just, I don't know, for whatever reason, they feel like they can give me pushback.

Do you guys have team meetings very often? Yeah.

So I do a team meeting once every two weeks. They get all the guys go out, I pay them to do promo, I take them to topgolf and then we do it. We do a big team meeting.

And, and do they have any sort of profit sharing or anything like that?

Um, other than the bonuses, that's, that's pretty much it.

Have you ever Thought about doing a profit sharing program?

Yeah, I've thought about it. Actually, I didn't think about it until I started watching your channel. I've considered, um, just, just haven't taken the chance to, to do it yet.

Some of it just gives you an opportunity to talk about like why, like your reasonings, especially when they're asking why a lot, you know, the inclination is to be annoyed. And I, I, I'm the most annoyed back in the day was when when people like question why for every little thing. The thing is now when they ask why, I actually enjoy it because I'm able to explain from a business perspective how it affects the profits and now they actually care about that. The thing that you're going to save and the reason why you'll actually make more money from the business perspective doing a profit shar than just being on time and the savings there. But your retention will typically be higher and it's very easy to see who buys into the game. And I think for you, like the struggle has been finding people. So these guys, you kind of let them do their quote unquote bad behavior because you just need bodies. Is that right?

Yeah, that's right.

Yep.

You're spot on.

Yesterday one of my guys didn't show up, which was a headache. I had to work. It's been tough working with some of the guys on the the team. So I'm going to address it today. Hopefully they can flip the switch and turn things around, but if they can, I'm just going to have to keep recruiting.

Does he know that's how it comes?

Yeah. Scheduling, for example.

Yeah, I just use the reminders app on my iPhone.

I'm not going to lie, I'm pretty concerned about Aaron and his business after that call. That's where your profit is. This is your profit. When he does that, his profits are not just going to go up marginally, they're going to double and triple. Let's go.

We'll see.

Next we're going to meet up with Carter from Rough Cut Lawn Care, who just started his business for the past couple years, but literally is making no money yet, working 60, 70 hours a week. He's come to the end of his rope. He's got to start making a profit in the business, otherwise things could start to fall apart.

I do want to get an Augusta franchise, but right now I met with Lee, talked to him about it. He said, you know, to try and come up with the cash to do at least half of the franchise cash and then maybe finance the rest. Over the next couple months, try and get 10,000 saved. And that's when it kind of hit me that my business isn't profitable Because I realized that I'm not making enough money to put anywhere near that away in a couple months. My name is Carter. I live in yuba city, A little bit north of Sacramento. Been doing landscaping for about four or five years now. Just got my contractor's license that we're gonna start doing bigger projects. Really gonna try and grow this year. Looks like I'll do a little bit over 200,000 next year. My goal is to do 600,000. Talking to Mike a little bit right now. My goal is to be able to actually pull a profit. I have about $18,000 worth of projects lined up. That number may change and go up depending on how efficient I am with two new guys.

So is that looking like 27,000 or so in revenue for this month, or what's your projection for this month then?

So, yeah, probably about 27,000 total.

And then how many total employees we have? I know you said you added two more. So how many will have total?

Three full time, one part time.

You're. You're charging $60 per hour. Is that kind of what you're shooting for?

Yeah.

And what are you paying those guys per hour?

So my highest paid is 25, and then the others are 18, and then the part time is 16.

So let's just run the math on this. So if we have out of that 27,000, let's say that 24 of it is labor revenue, because you got materials, and all the rest of it, you thinking maybe in labor revenue, maybe 24,000?

Probably 22.

Okay, let's go with that 22,000. We divide that by. Let's just call it four guys. So that's 5,500 per employee. And so if they're full time, that's 40. Let's divide that out. Got 5,500 is what they'd be making per employee. It's full time. Assume that just the full timers work. Call it average of $20 per hour plus taxes. $24 per hour times 160. So right now, out of the 5,500 that they'd be creating, 3,800 of, that's going to go out to wages. So that says one of two things. One, either prices are too low, or there's massive inefficiencies happening. You know, the best thing is about having a small business that has good customer service is you can raise prices and people don't leave. So if inflation goes up, if cost of wages and fuel and everything goes up, you can raise prices and pass that cost along to the customer. And if you don't raise your prices, you're gonna have such thin profit margins, you'll never be able to grow the company. You'll never be able to buy more trucks, more equipment, and you'll always work 60, 70, 80 hours a week, working your brains out, just trying to keep the business afloat. That's what's happening right now inside of Carter's business. And I'm trying to convince him to just jump, take the leap and raise prices. I guarantee you his close ratio go from like 83% to like 70%. What's your close ratio right now? Do you know what that number is?

Like 83.

Would you be opposed to growing a little bit slower next year, but being like, really focusing on profit? Because if you could bring that number down to 50% but raise your prices from 60 to 75 or 80, it completely fixed the profit issue.

I think I could. I could probably get away with 70. And that's what I've been bidding all the new maintenance accounts this past week. Past two weeks, I've got five new accounts. I got 100% of them at doing like 70, 75 bucks an hour.

I'd recommend trying to move your minimum to 75. I really would. I don't think it's going to affect your, your close ratio as much as you think. But ultimately, right now, growth is literally going to cost you money. Like, the only reason it's staying afloat right now is because you're working your brains out and a lot of your hours are still out in the field.

So all the money I'm generating is basically covering my guys.

It's just keeping the business afloat. If you literally paid someone to do your physical labor and stepped out of the business, it's not making money. Honestly, if you got five new customers this week, that's 10% of your. Your customer base, right? I am not opposed to you raising prices on everyone now. The reason is because the grass is starting to grow again and you're going to have this window of time with the whole leave situation and the grass is growing, you could probably raise all your prices. I guarantee you, if you lost 10 or 15 your customers, you'd recoup them within three to four weeks at your.

Current rate of growth.

But, like, doing that, that would completely change the business. He has a high quality service in a really good market. He can absolutely charge a Premium price, especially with the website from Lawn Care. Web Design is going to elevate the brand to the point where, again, customer service and great branding allows you to charge a premium price. When he does that, his profits are not just going to go up marginally. They're going to double and triple. Because right now there's not a lot of margin. There's not a lot of profit in the business. We've got to change that.

All right. Just leaving the coffee shop, unfortunately, I kind of got the boot. They were getting real busy in there and I guess they don't like people staying too long. I was using their WI fi. It has pretty strong WI fi here. So I might need to find a new spot to get some work done. I got busy and then they kind of politely asked me to leave. Oh, look at that. Take an extended life break. It's got some.

Pizza.

Pizza rolls. I have to admit, this career has not been very conducive to good health. At least I haven't set myself up that way. That's one of those goals that I'm eventually going to try to get better at packing a more healthy lunch. We're actually doing a training for driving our trailer. My goal again is to position ourselves to have all four employees ready and trained up on driving the trailer and performing basically every type of job that we, we provide. Trying to get that in today. We're a little bit ahead of jobs. So it's kind of a perfect time to just throw this training in there and just position us to be be ready for next spring.

I really do believe that, like, you know, if there's any unconfidence when it comes to growth because of marketing, you put that against Google Ads next spring rush and you just really pour that on during March, April and May. Like I'm talking 60 to 70% of your marketing spend during those months. And take a look at what they call. They just launched this new product a few months ago. We've been really exc. Excited about with the franchisees and that is called Google Performance Max. So when it gives you the option for what type of ad you want to run, do Performance Max. And what that does is allows you to put like a bunch of videos, a bunch of pictures, like eight headlines, and then it just basically optimizes your budget across all the different Google platforms. And we've seen that work really, really well. But I truly believe, like if you spent 5,000 that you spent this year, which like you said most, that was your decals for your trucks. If you Spent that in next spring, 5 to 10,000. I truly believe you'd go from 40, 50,000amonth to 80 to 90. Like I really believe that.

Okay, so just drive kind of slow. Practice turning, practice braking. So skidded a little bit. So maybe the brakes are up a little bit too high, but that's okay.

Does he know that's our cones?

That guy wants him. He can have our cones. Yeah, yeah, all the way. All the way. There we go. All right. We're just wrapping up driver training and this is part of, the last part is to see try to back the trailer down this somewhat narrow alley. So we've actually had a couple incidents. One person, one of our employees hit a car parked outside of our alley back here and another employee backed into. Stop. Go forward. Another employee backed. Backed into a car parked right on the corner here. So now we make it standard to back each other out, especially when we're by the street.

I'm feeling really excited because my two most senior guys, you know, they've been with me, Michael from the start. Jose's been with me now for a little while. You know, we sat here and just talked for like an hour after work. And it's great because they're just coming up with all kinds of ideas, ideas for, you know, how to make training better. They're coming up with ideas on just, you know, onboarding new employees, just everything. Just super excited. When your employees kind of almost exceed your expectations. You know, these guys come in and work super hard. It's the end of the week for them. They have off tomorrow. But they didn't act like they're in a hurry to leave. Feeling pretty pumped about their buy in and this whole process, growing the company.

First and foremost, I want you to run a Google Performance Max ad. Make one up. Don't spend a lot of money right now because you're not going to have a good cost per click. You're not going to have a good customer acquisition cost. But I want you to do one of them simply so you know how to do it so that you're more confident in the process of doing it. Customer acquisition cost abhorrent right now, but just know how to do it because I know that number gets massively discounted during the spring rush. So that's the first thing I want you to do. Second thing is I want you to have a meeting with Michael and Jose and just present the opportunity and have very clear goals of what revenues are going to look like next year and how many employees you're going to have have them know that you're going to be buying those things throughout the winter to set up for that growth next year. And that's starting March 1st. And it's a presentation of here's what the org chart would look like, here's how your roles would be changing, here's how your compensation would be changing. And I think based upon what I've already seen, they've already bought into a lot of that. Now it's a matter of how do we retain them. The next six months is simply going to be giving them a clear vision.

You're saying this meeting needs to happen, which I'm excited about, but did you say you think we have the potential of 60 to 80,000amonth in revenue next year?

Absolutely. Yep. I think that would be as a minimum.

Oh, wow. Okay.

I know it was a lot for Dylan to take in, but this meeting is extremely important for him to establish these two key employees for the next six months and make sure that they actually know they have a future at the business. So often times we can be debilitated because we don't even believe in our own objectives and the vision of the company. And if you don't have that, you got clear goals of where you want the business to go and what roles are going to be needed in that new company as you begin to scale up. The business look completely different for Dylan in 12 months if he can execute against these goals and actually have the confidence to grow. In marketing, this is why so many people kind of stumble into growth, is because they never plan for it. And the reason they don't plan for it is because they don't have confidence in their marketing to be able to bring the leads and the customers required for that growth. So I've got to instill that confidence in him just so he knows knows that Google know how to run the Google Ads and to be able to know he's going to have these employees that he can grow and use them as a foundation to build the company next year.

We work in the rain, too. It rains in Washington state while it rains in Arizona. Hey, what's up, guys? This is Aaron with Arizona Yard Maintenance. My business is yard maintenance. It kind of gets me in the door without having to solicit for trees. I like to do trees. Today we are removing 22 trees that blew down in a community. This is some of my setup. So I got a Vermeer stand behind Skid Steer. I have a Boom Lift Genie Boom lift. Here's my truck.

I don't think he quite sees the gravity of the cash crunch and the balance sheet.

My 2022 F450.

When you're paying 1700amonth on a truck that is worth $140,000 on his balance sheet.

By winning that I sold, the excavator was able to put a down payment. Get that truck. It's very useful.

It's a beautiful truck and there's that much debt.

It's nice. I recommend it.

I'm very afraid. I'm honestly freaked out for him.

If anyone needs a truck, get a F450.

And this is why I'm very afraid of any influencer that tells people to buy a bunch of equipment, go into massive amounts of debt.

The next giveaway is going to be this 2017 F550 Diesel.

Because influencers have cash flow from their masterminds, from their videos and from their social media. If you don't have that, you can't afford $1,700 a month for a brand new truck. The equivalent truck that is 10 years old could absolutely do the job. Maybe it only lasts a few years, but you'd get to the promised land of growth to where it actually be profitable instead of dying on the way to the journey thereof.

But furthermore, with the rest of my equipment that's on this job today, here's a dump trailer. And then I set up the dump trailer with the hitch with my wood chipper. That way I can pull my dump trailer chipper around this entire community. I can take it on the freeway. It's not legal. I've done it several times. Very cautious when I do that. But when I don't have another driver, another truck available, I double pull.

I really hope I can get to him just how important it is to get rid of some of this debt, release some of this, these payments, 5, $6,000 a month, that's literally 15%, 16% of his revenue right now. That is all of his profit being wiped out because of loan payments.

I feel like my biggest expense was killing me is labor.

That's why I look at the balance sheet first. But you're 100% right. And like once we get away from that acute problem that I do see there, then it becomes a matter of the efficiency of the labor. And I think P4P is the right call. Like what software do you use right now for your projects?

I mean, to keep track of my scheduling.

Yeah, scheduling, for example.

Yeah, I just use the reminders app on my iPhone.

Okay.

So I was 1% software, but it kind of went it's a dud right now.

Are you open to putting implementing software though? Because are you going to wait for that 1% software?

I don't have any really trust in it right now.

I would highly recommend not. I wouldn't touch it with a 10 foot pole. I'd recommend getting started with.