$500K Power Wash Company CAN'T PAY the BILLS

121 invoices, unpaid. 121 right now. It's a mess. I've sent emails, I've sent texts. No response. But you sure as hell opened that damn thing 17 times. So this bothers me. We're running, running out of all kinds of time. This is the ADD thing, right? A million miles an hour, all the time. Formula One, race cars, 400 roads. My brain never stops.

Go see a therapist. Talk to somebody.

I was on medication for it. It doesn't work for me.

Delegate and lock it up.

If nobody wants to be confrontational, then we're not gonna figure it out.

People will make mistakes. You make mistakes.

I'm just speaking cause I'm a truthful person. I'm gonna move past it and we're doing something else.

Go get sales.

I don't wanna repeat myself again.

You own the business. I'd get depressed too if the whole reason I got into business is not happening. Someone like Blake, for some reason, has stuck around, which I gotta figure out.

Why he was kind of doing this without me really knowing anything about it.

In order to gain trust, you have to be trustworthy. You can be as ADD as you want. The employees will like work. So I'm not gonna get involved.

$80,000 of our money sitting in people's bank accounts right now. That is ours. You should go storming their house and they're robbing them.

But that's annoying as hell. Why are you making me work to get my money?

You're a business. We're not a bank here.

It's like bar rescue.

What was that?

Today we are visiting Mr. Sudsy here in Indiana. They do Christmas lights, gutter cleaning, pressure washing, and they do over $500,000 in annual, but we don't know where the money's at. So we're gonna visit them today and see if we can do a turnaround.

Are you tired of unsightly stains on your house or business? If so, just call Mr. Sudsy.

Mr. Sudsy. Guy's a cool van. Dude, light that pitch up.

What's up, buddy?

Hey. How's it going, man? This is an awesome shop, you guys.

Man, I love the truck.

Appreciate it. Yeah, it's like I said, it's Titan, it's Christmas light time. So it's like inventory's everywhere.

So do you. Do you all do where you, like, lease them out?

That's it.

Yeah, let's go.

Yeah.

That's awesome. How long you been doing that for now?

Three years.

Okay. Okay.

So Chris Brown.

Chris.

I'M Chris Brown. I own Crystal Clear Window Cleaning. We merged this beginning of this year. So he does the window cleaning side and I do the power washing side and then we do Christmas lights. And if I need help, he comes and helps me. And if he needs help, then I'll hop in and help him.

Got it. But it's all under one end.

That's it.

And then you do the gutter cleaning too, right?

We do gutter cleaning as well.

Okay, got it, Got it. Windows are tough. It's funny, back in the day actually had a gust of cleaning services.

Yeah.

And windows. When I hit windows, I'm like, alright, I'm out. It's one of those things that's hard to train guys on. Sure to actually do it right.

Happen to scroll through Facebook today, man, and I'll be honest with you, it made a big, a big impact for me to kind of stop and watch a 33 minute video with you and a landscaper who has those 13 taco bells and a huge staff and you kind of feel like you're drowning. That's it. And it got me. I saw it. I'm like, student's a million dollar company with $11,000 in the bank account. Like, what the hell, you know, I mean, like I'm in the same boat. Like I'm not a million dollar company. Say we're half that. But the problem is there. The income side is not where I want it to be. So I need, I just need some guidance or some kind of help to get in a better spot. I'm willing to take the heat, I'm willing to take it all. Because at the end of the day, constructive criticism, like I told you, is where it needs to be at. I didn't know who Mike was when I found the clip that came across my suggested feed. I didn't even know him. Wasn't even a follower. I just feel like this last year, actually two years has been kind of rough. Especially after Covid. Some things changed. Price inflation, we raised our prices. But I'm still having some issues and maybe I'm not in the right area. I know my daily operating costs have kind of broken all those down. But maybe I'm missing something, man.

So how many, how many houses you do you have for the Christmas lights?

Well, last year we had 103. That was in year two. This year it's kind of fluctuated a little bit with the economy. And the hardest part for us I think this year is the numbers are up, but the profits are down. The income's at a hurt level compared to what I've ever seen. I mean, you take the last year's number, let's just say of 113 or 130. I can't remember what the number was, but in gross profits. And then you look at this year's. And after depreciation and stuff, it's like $25,000. Now, this is before Christmas lights. Once Christmas lights comes in and pays, it'll boost the profit side back up. This. This keeps them busy. It keeps them going so they're not sitting at home twiddling thumbs. They're looking for a new job. You know what I mean? He's been here for a really long time. He's my lead. He's my lead guy.

Nice to meet you.

So I'm Blake Will. I'm Blaine's lead tech. I've been with him for about five, maybe six years now.

He knows where everything's at. He also knows all the dirt on the company. All right.

Yeah, that's it.

He's the guy. He's the guy.

This is Curtis. Curtis Duggars. He's new, but he's solid.

I worked with him for a week last year during the Christmas lights because they needed some help. And then once he lost the rest of his employees, they hired me on full time.

Blaine has been struggling with his profits the entire year, but in order to stay busy during the slow season, which is the winter, he has his crew install Christmas lights. Do you graduate the pricing as people get in later?

Yeah, only toward, like, two weeks before Christmas. That's when it goes up. Because I'll be honest with you, the inflation starts happening from the vendor. So when I start buying product and they raise it every week that I get closer.

So you don't buy them all in the summer?

I don't do that. And I'll tell you why.

Blaine is having to purchase the actual Christmas lights later in the year. The problem with this is the cost of the lights go up as you get closer to the holidays. This leads to less profits once the jobs have been installed. He's also concerned about buying too many lights and then having excess inventory that he has to store the rest of.

The year because you don't know what Christmas is going to be to come. I know a lot of these guys, they order them early. Guys in Indy, they order them early. The problem I see with this is if I cannot get rid of that inventory or I can't lease that inventory out, I'm now sitting on 30 to $40,000 worth of inventory sitting in my shop, I don't want that. And it just takes up space. It's eating on my income. And you can't sell it back, you can't send it back, so you're just stuck with it. Sure, it's great for the years to come ahead, but I'm thinking like I'd rather just pay more for the lights closer to that time. And I have to inflate my prices because that's just the way it works then to order it and save myself. And I know how much it saves. I mean it saves quite a bit, but. But the issue I have with it is it's sitting on that inventory.

Do they pay? They don't pay anything up front.

Then it's all, no, 50% deposit up front, 50% on completion. Now I'm really bad about collecting right.

Away, but if we had the cash, we could get them earlier.

Absolutely. 40% more when we have a line. I mean we have a line to do that. So I'll go more in depth with that.

Let's get them out on the road.

Yeah, that's it.

Get them rolling.

I sometimes bite off more than I can chew, but I always get it done right so it always gets finished. It's a big difference. Cuz he's cool collective and I'm the, oh shoot, Susie just called. She's not happy with something and I'm like, I gotta fix it now. He's a talker, I'm more of the listener now. People love it. Don't. Don't get me wrong because I'm probably one of the only businesses that will come out and take care of what we've done and messed up like immediately. Sometimes I don't care if it's 4 o', clock, other times I'll wait till the next morning. But it's the first thing that we're doing so you don't get shuffled underneath the rug. Because I want you to feel like a customer, like you're somebody rather than being like every other company. It's just like, ah, we'll be there in two weeks when we can get back. And I'm a people pleaser, right? So he'll tell you a million times, this dude does way too much.

Not saying that it's not a good thing to want everybody happy, but I feel like it's also an illusion to try and make everybody happy.

I guess it's just something like in your heart you want to make people happy. You know, I mean, nobody wants to take somebody off you know, Lane is.

Very passionate about it. He's a very much people pleaser.

If he's thinking that mindset and he's always trying to make them happy, then I feel like it takes away from his and his family.

I'm really. I'm still a people pleaser at heart. It'll never change. It's who I am.

People pleaser is not a good thing. And Blaine definitely has a problem with people pleasing.

I'm really quick to give it away, right? So if. If they call and they complain and I can't make it right by having this conversation that we're having on the phone, I'm asking for one more chance, and if I can't get it right, get it for free. So then I walk away from money. I walk away from it. And then people are like, no, I didn't ask for it for free. If you offer that bill for free.

Free.

Most people feel bad afterwards because they're like, I didn't want it for free. And I'm like, it's okay.

Well, one of the things too, I had to realize because I was the same way, is like, customers don't call for free services. They call for something to get done, right? And so when they're complaining, sometimes it's almost an insult to like, well, let's give it to you for free. It's almost a matter of like. Like, I'm just sweeping it under the rug. Like, I was giving to you for free. I'm sorry.

Yeah.

Because we think that's gonna solve it when they're like, no, I just want this done right. I don't care what it costs. Right? And so I had to make this switch in my brain too. Cause, like, I'm in it for the money, like we all are to make a living, but they're in it just to get the job done. So, like, free. That doesn't help me. I need this done.

Yeah, I'm the. I'm the pat, the petty, passive aggressive person. So for me, it's like. It's like killing kindness, and then you can deal with that problem afterwards. I'm coming back to make it right regardless. I wouldn't be able to sleep if it wasn't done correctly.

Blaine seems so wrapped up in trying to please everybody, and it's coming at the cost of his business. Look, you can't please everybody in business. Now, Blaine said something earlier that caught my ear, and I think it might be the cause of their cash flow problems.

Now I'm really bad about collecting right away.

I need to find out what exactly he means by that because I have a feeling that this people pleasing is costing him a lot more than he thinks.

Shoe that's hanging us up this year that's really hard is I'm taking all the cash and I have to pay it out. So I really don't know what I have coming in and coming out knowing when we're up, when we're down. So I'm constantly. This year's been like touching the line of credit too much. So it's not that I'm broke, it's that I'll show you just really quick. This is a huge problem of ours. Receivables 121 invoices. Unpaid 121. And if I click that and I show you how far back we go with unpaid invoices, you are looking at March 8th of 2023. That's a ticket that's still out and that's window cleaning. But the issue is it's like look how many times it's been emailed, it's been printed, we've mailed them. And now I physically recently went to the place and handed all the invoices and they've been submitted and I'm waiting to see those come through.

Is it 130 outstanding right now?

That's a hundred and. Yeah, that's it. 130 outstanding.

You know what the 20 total outstanding is?

But most of this is from October.

No. Isn't that crazy? 26000 of that though is a parking garage.

Yeah.

But 84,000 and so. Yeah, so there's one other one.

So 26 of that's one job.

Yes. So we'll go.

How much of that is like going to be collected on. Likely enough because it's last October.

Oh, we stay in the hundreds all the time. It's a pain in the ass.

$84,000. Literally 120 invoices dating back to almost eight months ago that haven't been paid by the customers. This is the definition of bad cash flow.

Send emails. I've sent texts. I have one that's back from June that he did her windows. I washed the house. I got called back to touch up a spot in the driveway. I now found out the house is a rental and it's not an owned property but it's on a golf course and it's big now. They wanted to make payments. We used to fund it in house and I charge them no interest and just let them break payments up. Because the part that I would do this for when I was by myself is during the winter was if you had like 10, 12 people with a hundred bucks a month, you got a little cash flow coming in. And it's not a lot, but it would pay like the mortgage for the shop or it would pay the rent wherever we were at. Right.

So interest free debt.

That's exactly right. So, so that was the nice part. Right. This person couldn't get approved through Wysdack. I didn't know why, because I'm like, look at this giant house. And I'm like. She said, I entered my phone number, just said declined. So we went back and forth on this. We've sent her multiple things. She writes back, I give her options. I'm like, if I give you till January 1st of 2024, I give you three months worth of payments, can you pay it off in three months? And she's like, yes, I'll start making payments yet to receive a check. So I'm not a confrontational person. So I'm not going to the house. I won't do it.

Well, this is the thing. If you had $80,000 plopped on your table right now, you'd be pretty excited. Like the business would be actually okay. Yeah. The thing is, that's literally what's just sitting in the receivables.

I'll get to a point where they haven't paid it in their own schedule. And I'm like, go, put them up. Because, because it's guaranteed. Once they're up on the house, I'm gonna get paid.

But it's not guaranteed if you don't actually collect on the invoice.

So it's a double edged sword. You look at it as they put their 50% up because usually don't schedule till she used to do it. She's really good at it. She's like, we can't schedule you to do anything until I get 50% deposit. That's. And then I'm like, hey, screw that, put them on the calendar. Anyway, I'll get the money.

Not collecting on these invoices is the equivalent of literally giving interest free loans to the customers. And guess what? We're not a bank. We're a business trying to make profit. Let's say that you get the money if you get paid in January. You paid for those lights several months ago. You paid for the labor in November. You're still giving an interest free loan to an, to a customer. Yeah, for months. And you're, you're bearing the brunt and the burden. Of all those cash flow problems.

Yeah.

And so really, like, in my opinion, we can look at the business and profits and like margins all day long, but if we just fix the cash flow problem because like, you can take a very profitable business that has bad cash flow and it'll go bankrupt. Because the ebbs and flows of when you collect, if it ever gets too low at a moment when you're just not collecting very well, you go out of business. Like, cash flow is oxygen.

Right.

And so fortunately, we have this thing called a line of credit that we can dip into.

Right.

But honestly, like with interest rates at.

On that pipe, 12, 15%, it's 10, 10.125.

You're giving free interest rate interest loans to an employee, a customer, and then you're eating the 10%. Right, right, understood. When you take $80,000 that plops on the, on the, onto the P L this year, all of a sudden you have a 25% profit margin business. A lot of times we're just afraid because we think we're going to lose out on the work. What I would recommend, especially when it comes really busy, which I'm guessing is spring, Spring rush. Spring, summer.

Yeah.

When it's like nuts and you just can't stay up with the work, that's when you need to flip the switch and be like, credit cards on file. Making it a requirement to have a credit card on file can weed out a lot of customers that otherwise take months to pay. It would also prevent this whole problem with having these overdue invoices that haven't been paid by the customer. He's letting his customers.