Business Bootcamp: Carter Final Zoom Call

Welcome back to the Mikandys podcast, where we discuss ins and outs of owning a small business. If you're new here, the mikeandys podcast is all about taking your business to the next level. We're covering the final episode of season one for Business Bootcamp, Zoom calls this week. If you haven't heard, you've been watching four different home service business owners overcome their challenges and build their business into something great. Part of the whole thing is zoom call check ins that we do with Mike. Along the way, Mike has tons of great advice for anyone who runs a small business. So here's what we're getting into. We're talking to Carter from Rough Cuts Lawn Care out of Yuba City, California. Carter is doing a lot of work for almost no profit. And the problem is pretty clear. They're setting their prices too low and they're worried about customers jumping ship when they finally raise them. He needs to learn that the customers he loses when he raises prices, those are the customers you don't want to keep around. As always, you can find all this and more over at the Mike and his YouTube channel. But it all comes down to this final call with Carter from Refcuts Lawn Care.

Hey, everyone, it's Mike Andy. Today we're going to be hearing the last coaching call, the entire consulting call with Carter. And Carter has been on the business boot camp for almost a month now. And we're gonna look back at the progress he's made over the past month. He's grown his business quite considerably and over the past couple years has grown from basically nothing. Now he's gonna do almost $40,000 in monthly revenue. And here's the kicker. He actually wants to join Augusta Nation as one of our franchisees. So we're gonna talk about if he should do that, why he might not want to do that, and the timing behind that. Cause he needs to save cash. He needs to sell off some of this equipment he's not using. It's a great episode if you're trying to grow your business and get past that part where you're in the field working and start actually managing the business. So this is the full. If you want to watch the episode from Business Boot Camp, in the description, there's a link. Check that out.

Everything working now?

Yeah, now we're talking. Let's go.

Sorry I had to move closer to the. To the house.

Cool. What's a. What's a. What's a Levis Yard maintenance.

That is my old business name because I just switched over. I've Been waiting on all my contractors license numbers to come in before I make new shirts. So.

Cool. Cool. All right, well, let's, let's go ahead and recap. I know last week we talked about the trucks, the mowers, what's kind of been the, the progress in terms of getting a third truck or potentially even selling the mowers.

So I think I'm going to keep the Tacoma for right now because I already have it. It's a decent work truck. I love that truck. So I would rather get to keep it and then maybe eventually, um, when I need to get another one, I can just keep it as my personal for four wheeling and stuff. So going to keep that I believe then for the mower. I was going to talk to you about that. So I think with the amount of growth I'm going to be doing, my thoughts is, is it worth it to keep it, not make a pay, you know, be making the payments on it, not getting used for the next few months. And that way, spring when I do split to two trucks, one of them can have that as this mower for the bigger accounts or is that not, not worth it? Because I just don't want to take a huge loss now by selling it for. If I sell it for, you know, 10,000 or something like that, I don't want to take a huge loss and then need it later.

Yeah, I think just to depend on what you can sell it for. Honestly, like if we're doing like a thousand dollars loss versus a $5,000 loss. Yeah, because my concern is the fact that you haven't been using it all tells me that, like it probably not super necessary. And then what happens is you're going to use it for a few years and as you grow, it's going to actually become a pain in the butt because it's not going to be standard with all your other equipment setups. And so if you can just to standardize from day one and get rid of a piece of equipment that you're only going to use on say 20% of your lawns, like it sounds like you're not even using it, which tells me like it's probably like 20 to 30% of your lawns or less that you'd be using it on. And so yes, you can kind of make a route and you know, do extraneous ones, but that becomes unprofitable because now you're doing larger routes and more drive time in order to get to those jobs. Right. It's just inefficient. So if we can from day one, like kind of just standardize things. I would do that. But again, it depends on how much you're losing in terms of, on that debt.

Okay. So I'll just have to see what, what I can get for it because I don't want to, you know.

Yeah, I'd put it up on Craigslist and Facebook and just. You'll go for what you'd like. And then if you sell it, great. If you don't, then yeah, maybe we just roll with it. But every day that thing's sitting, it's probably losing 10, 15 worth of value, if not more. And so even without using it. And so let's try to see what we can get for it. Now, it's not the best time to be selling, but even if up until next February you have it for sale.

And then if it doesn't sell, then yeah, we maybe go ahead and use it. But I'd rather take a one or two thousand, three thousand, four thousand dollar loss on it than trying to accommodate it. And now you're going to have to get a bigger truck, a bigger piece of a trailer to, in order to pull that size of equipment. And now your whole setup starts to change and then down the road when we think about four or five trucks, you're gonna end up having this one weird, odd setup and or just doesn't get used. Right?

Yeah, no, you're totally right. I was just thinking if I get bigger accounts or if I get more of the commercial accounts because it can be used on like the cemetery departments and then like two residential. So all I was thinking was if I were to get more of those. But I guess, I guess I can always get one down the road if I need it.

Yeah. Yeah. And you know, maybe over the winter, as you have it for sale at the price you want, you do go get those contracts. Okay, maybe I can make sense of it. But if it's not being used but once, twice a week, like in terms of days, I just don't want to touch it. Right. I'd rather get a smaller piece of equipment that I can use for five days out of the week and have good asset utilization. Right?

Yeah. I'd rather get like a 46 or 48 inch stand on because that can fit in a ramp rack, whereas this is just a little too wide.

Right? Yeah, that's the big thing. Right. So in terms of revenue for this month, what are we going to be looking at? I know originally we started thinking 26, 27. Then you're thinking like 37, 38. What are we at, do you think, for October?

Probably gonna be right about 34, 35,000. Uh, I did have. One of my guys was putting in a cobblestone pathway, um, and he's had to redo it. So that ate up four days of labor just for one guy. Um, I wasn't, I wasn't watching him as closely as I should have and they were really spaced out. So I was like, we gotta. Got to correct us. So he's been working on that. Finally got it, got it taken care of. But that's, that's definitely cutting into, cutting into some profits.

But I love those projects.

Yeah, Flagstone was one of those things that we, we abandoned. We, we used to do it. It was like we actually did flagstone for more than paver patios for a long time. But the spacing and the jointing sand and all the rest of it, if it's not perfect, man, it does not look good. And so we ended up abandoning it.

Yeah, I wouldn't have, I wouldn't have taken it if it wasn't for like starting the cobblestone. And then it just kind of worked its way from a simple little job to, ah, gotcha. Huge project. And.

Yeah, but Cobalt, the, the guys that mentioned that you are doing some of these landscape designs, like the drawing of those. How, how has that been going? Have you started doing that to sell the larger projects? Is that what you've been doing?

Yeah, so I've got one design sent off and then a few like just sketches for people to kind of depict from and then I'll fully design it. So I got one project, it's probably gonna be about 25, 30,000 that I'll be working on a quote for this weekend. Another one, the budget's 10,000, but I think it's probably closer to 12 to 15. And then the one that I've done the design on, he's good with. That's probably gonna be like 20, 24, 20 to 25,000. So got those. And then a bunch of smaller projects lined up too.

So does it look like November is going to be around 35, 40,000 as well?

Then it might come a little bit higher than that.

Do you think part of that will be the fact that you have the third truck with the Toyota Tacoma now to drive around?

That'll help a lot with sending the guys to do smaller jobs because, like, I've been getting calls for, you know, little property cleanups or weed pulling and stuff, and I'm having to tell People, I don't do that because I. It's not worth my time to go do that, do those things. So once I have that third truck, then I can, you know, send a guy to go do that for an afternoon or whatever.

If I can charge enough for it.

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Yeah, like with this, just the two trucks, your capacity, you're at capacity at say, 34, 36,000, right? Maybe you get 38 out of it. But, you know, I think you can get up to, you know, more around that 48 to 50, even just by having a coma for the smaller project. Just, just. Sometimes you just need got. You need something to transport people. Like, honestly, you just need something to get them there, right? So that's good. Good for you, man. All right, so.

Going into winter and going in next, next, next spring thing, what's sort of the main objectives you're trying to tackle now? I know, like, over the past 30 days, we've really looked at mostly like, you know, raising prices, really making the. The. The maintenance side of things profitable and really trying to focus on how do we make this profitable enough so that you're not so stressed on the finances side of things. But, like, what are you kind of, where's your head space now that really you're doing probably twice as much revenue as you were just five, six months ago in terms of monthly revenue. Where's your mindset as you kind of look into next spring?

So right now, the goal over the next two months to get as much debt paid off as I can. I have.

20,000 I want to try and get paid off. Just business that I took a loan from my grandpa and then I have my dump trailer I want paid off. And then obviously the Tacoma I owe a little bit on. So I want to get all those things paid off first two months of next year, first three months, probably I want to get enough tucked away to get open a franchise and then hit it hard this spring and try and try and at least Fill up the two maintenance trucks, if not get a third. So we'll see.

Because like, right now you're doing like, you're doing more or less. Once we raise the price, like 12, 13,000amonth in maintenance, even if that can get to 20, and you can be kind of more around that, like 40% of revenue being maintenance.

Especially if you're able to have the higher pricing, it'd just be a little bit more stable in terms of cash flow too.

Oh, totally. Yeah. Because then it's consistent and I can project out how much labor is going to cost, how much materials and stuff. So, yeah, would definitely help with that.

As you kind of go into next season, like, do you have any of your guys that you can kind of lean on? Because, like, my. My concern now is like, hey, this year was great, you know, 250, whatever it might be. But when you start passing what next year is going to be, very likely five to 600,000 at least, you're going to need to start delegating a lot of the project management and like. Like, for example, correcting the flagstone path pathway, like that sort of thing. Do you have someone that can help you with that going to next spring?

I would most likely use my brother. The only thing is he's the one kind of heading up the maintenance side. Got it. So what. Another thing I was going to mention or ask you about was setting up systems because I'm getting to the point where I can't manage everything. I. It's too much like. Like I have four or five leads from the website that have been there for three or four days, and I just haven't had time to. To call them and get a quote scheduled in. So it's like, I really need that. But I don't know how to go about, like, do I pull him from the maintenance and swap guys or how can have you.

Are you actively looking for employees right now?

Not really. Just because I don't have enough work and going into winter, I don't want to, you know, go to winter with 12 employees and then have to lay everybody off.

How many guys do you have now? You only have the three, right?

Yeah. So I have three full timers and a part timer.

Okay.

That just kind of fills in, I.

Think then if you're really concerned it's going to drop off during the winter, I would stay where you're at because your capacity is going to be around that 45,000, 46,000amonth in revenue, which is great. You'll be profitable at that really good at that size of business. And my bigger concern is anything beyond that though, you start needing help, right? So like if you, you know, whether the franchise is next spring or the year, year after, they would help with the admin side like getting the lead process, doing the sales over the phone with the mowing side of things, at least taking all that stuff off your plate. But regardless, you're going to need help with the project management side. Cause you're doing these larger projects and if you, if your brother can do that, that's a higher level skill than mowing. So if you're able to hire somebody to take his spot or even say hire two people next spring as you ramp up the maintenance side and then pull him out and be like, hey, I need you for project management. I trust you, I'm going to be able to pay you more and I need you to like take this stuff off my plate. So once I sell the job, you take over, right? And that would be the delineation that I would use for him for is like, I sell the job, I get everything on the pre, you know, the materials, all the rest of it. I hand this off to you and it's your job and I never show up again. Right. And whether you need to give him profit sharing or give him a raise or whatever is needed because that is going to be the limiting factor now as you pass 40,000amonth in revenue is simply the fact that you're just going to max out your time. And that's why so many people like can't get above 500 grand in annual revenue because they max around $40,000 a month and they just, they run out of steam. You just, you can't be everywhere, right? And you can't answer every phone call and like you said, you're falling back on lead. So either a, you need admin help or you need project management help, right?

So.

So would you say admin help would be easier to get though?

Because like I know someone who's looking for work who I could hire for part time admin work that might be helpful. That would be a better option to.

Yeah, it just depends how fast you scale, right. I think that my, my, the big thing I'm balancing out is the fact that we don't have a ton of cash. But also you have enough cash to scale, right? Like you have more cash than I thought originally. Like when you told me last week, like I was like, man, like 50, 60 grand like that, that's some cash to be had. The thing is.

Because when, when you've grown as much as you have in the past, even the last two months. Right. I know that if you had someone helping you even part time at admin and you had your brother to help with you in project management, you have two different constraints in your business. One is assets, trucks and equipment. Right. And that's why I said like, you kind of have this capacity limit with the tacoma firing around 45,000amonth revenue. The other cap, just human resources. And right now you're just tapped out around that 40,000 per month because you only as soon as you add admin help part time and then a project manager to help you on the project side, you literally go from 45 to probably 80 to 90,000amonth in revenue just by having those that help. Right. So if you join the franchise, they could handle the admin side regardless. If you don't though, and if you have somebody, I would definitely hire them next spring. And the reason I say that is because you have enough cash, I'm confident in your ability to raise the prices like we talked about and have the margin to where you can afford this. But if like your ultimate, like the determining factor of whether or not you get to 60,000 next year or you get to 80,000 next year is simply going to be whether or not you have help on the admin side and the project management side. And so if you have someone that's like, hey, I'm willing three days a week or four hours a day, I would definitely be like, hey, February, I need you. I know I'm raising prices to be able to accommodate the extra cost. And then I'd be talking to your brother like, hey, there's higher value tasks I need you to do. You're going to need.

Well, he already, he wants to get out of mowing. Yeah, perfect.

Yeah. I would 100% be pulling him into that because it's a higher level, higher value to the business and he can train some mowing still, spot check them, know everything about all the contracts, all the jobs, all the rest of it. But if you do those two things, help an admin help on project management and then you've now get the truck to get the asset side. Those are your constraints to growth. Those are the two constraints. Right. So having the cash that you do have, I think you can do that and pull that off. Honestly, it's going to be a little bit of a stressful spring just from a cash flow perspective. But once you get above that, the growth, you'll literally, you can literally double the business, no problem. Next year in terms of monthly revenue, like I see 80,000amonth in revenue next year being possible if you can remove those two constraints.

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Yeah, and I've already been thinking of removing some of the more difficult customers. The ones that have, you know, a billion shrubs that need to be trimmed and different types of plants. And it's like I gotta either answer a phone call. Yes, it's this time to trim it. No, it's not. Wait, trim it this way. Just getting rid of those because there's maybe three or four. And that was simplified the mowing so much because then it's just, just basic.

Yeah, I'm not concerned. So I'm not concerned about your growth because like you just got a good website that's just getting started and if it's already getting leads, like I'm telling you, grow.

I think it's already on the third page.

Yeah, it's not, it's not, it's not going to be the problem. The problem is going to be the constraints inside the business, which is trucks and equipment and then also the, the human resources side. And so, you know, if you're days behind, that just tells me like, and at your age, man, like, it's just time to go. Like you can literally get three years worth of progress in six months because you just realize the constraints. Fix the constraint, right? When you're trying to grow a business fast, it's like, where's, where is the one bottleneck? Fix it. All right, Next bottleneck, right? And the two constraints are going to be the trucks and equipment, which we're trying to figure out with the whole like pay down debt, be able to get another truck or two. And then the other side of the is the human resources side, which is going to be your brother. And it sounds like someone part time admin those two things once alleviated, easily 80,000amonth in revenue next year.

All Right, Sounds good. Yeah, I'll definitely. I know I need to work on. On systems though. That's a big thing. So I mean, that's something that the franchise helps with a lot too. So is it worth it to try setting up my own now or wait until it's really chise and that way I'm not having to change stuff.

Either way you're going to be successful. To be honest with you, I think it's a matter of either you grow and then you're like, okay, I've built this $80,000 a month behemoth. I now need to make it profitable and based on systems because I'm lacking in that area. Because what I don't want to do is like, okay, I figure all these systems and do all these things and take you three years to do it. I'd rather you just focus on selling because that's what you're good at and that's what the new website is going to help with. Focus on that and then we can correct it with the franchise. Right? We can kind of bring some law and order it. I'd rather you go get the growth because they're to be had right now you're literally not getting back to leads, right? So let's focus on the growth because the franchise will get you back in the systems. A little bit painful. You'll be like, hey, you gotta correct this. And like, this can't happen anymore. You got to cut this out. But then they'll become profitable and that's probably the stage where someone like your brother becomes the, the GM of that location and then you start a second one or do something different. Right?

Okay. Okay. Yeah, I'll definitely look into and see. I might end up pulling him from maintenance or having the one guy run with him for maintenance for all of November and that way he's caught up on it. And then starting December 1st, my brother Riley will no longer do. Do maintenance.

And you'll feel. You'll feel the immediate pressure relieved on your schedule now. Someone. Yeah, you'll feel that right away and that will alleviate the time draw that currently is on project management. So you can take those three or four leads that are sitting in your inbox right now, actually deliver on them. That's when you start to grow. When now your time is spent on selling because now what's tough for you is you've been so much in production mode for the past two years. Switching to now. My time is better spent working on the business and getting sales. Just getting more sales is the Number one thing you should be focused on.

But then it also comes to, I need to get skilled employees because the guys I have right now are more entry level. Like, I'm teaching them everything about landscaping. So I do need to find a guy or two that has experience because, like, I couldn't just take my brother to a job and give him plans and come back. And irrigation is done, right? Because he's never done it. So, like, I know that that's something. Is that something I should start looking for now? And that way I have a guide.

You got to ask yourself, do you even. Do you even want to address that constraint? Right, so you don't have to find skilled laborers if you start paring back what services you offer. Right? So this is what you're going to run into as you scale up. You either find more and more skilled people, or you create the systems and simplify things to where there's only certain services that you do offer. So ask yourself, I, if I was you, because you said your brother was you wanting to move into the project management side, I would make a list of all your servers and be like, which ones can he not do? And start nixing those.

Okay.

Is it really everything?

It'd probably be most of the projects. I mean, simple stuff, throwing bark down a rock, drip systems he knows, but he couldn't put a sprinkler system in. And I could always have it set up to where those more difficult things. I just make sure I'm there to train him and then get him caught up and slowly, you know.

Well, then maybe you just. Which ones are gonna, which ones are gonna take the longest for him to learn? But what can't he learn by March of next year? Maybe those are the ones we nick. Right? Because again, getting more leads and growth is not going to be your problem. It's going to be constrained. Of those two things that we talked about, the truck thing we can figure out. But the human resource side, if you're tied to every job, you'll never be able to go focus on selling. And that's what you'll need to do to get past 50,000amonth in revenue is selling. And so if you're always jumping between job and job and all this irrigation broke and I don't know how to figure this out. And then, then your guys are inefficient. They're going four days over, like, all this stuff happening, you'll. You'll just be like spinning your wheels like crazy. And this happens all the time in projects, and it's going to be harder and harder to find skilled labor. It's going to be the people who either standardize what you do or just simplify and cut it out completely because then you can scale up and you can focus on selling.

Okay. All right. A lot to think about. Maybe I'll book a 45 minute call with you right before springtime. Now we can kind of go over everything, share my progress, and then we can figure out what you know, or maybe, maybe at the beginning of the spring, like a couple weeks in and that way you can help me with the issues. I'm coming. Sorry.

Recap. We'll probably do a recap too, kind of see where you're at. You've kind of done so I look forward to it. You're doing good. It's been great. You executed well.

I really appreciate it.

Really well. Like in the franchise model. What I was really looking for at too is like, how well you executed this past month to see if it'd be. If you'd be good inside the system. And I think you'd do great. I think your growth, you're going to crush that. And then it's just a matter of like, there are systems that you would need in place and that will seem somewhat confining, but it'll be like that's what's required for you to be able to hand off daily operations for you to get out of the business, things like that. But you'll do really good. Like just your whole, you have a very level mindset as entrepreneur. I think they'll serve you really well.

Awesome. I appreciate it. Hey, so it would be good then to bring my brother to.

Yeah, I would recommend that.

Yeah.

Especially if he'd be good taking more of that leadership role. If he buys into that mentality, he starts helping with like creating systems around which type of jobs you want. I would. And especially he's probably gonna help you with somewhat on like how much you need to raise prices on those maintenance contracts going next year. I would definitely recommend you guys come up to him. Just get on the same page. He can be in the support track too and like learn how to support you better and like learn from the managers and things like that.

Okay, sounds good. Awesome. Well, I really appreciate this. This has been an awesome month.

Awesome.

Helped a lot change a lot of things. So good. I appreciate it though.

You have a great week. Great, great weekend, man. Happy, happy Halloween.

Thanks.

Have a good one.

Take care.

Bye.

Bye.

This has been the Mike Candice podcast. Now you have some ideas on how to take your business to the next level. If you like what you heard, we have tons of lectures, interviews, and more over at The Mic Games YouTube channel. That'll be right up your alley. That's all we have for you today. We'll see you next time.