Chapter 12 - The Business Would Die Without You ( Total Business Turnaround Book )

Hey, everyone, it's Mike Andes.

And today I'm gonna be reading Chapter 12 of the Total Business Turnaround book. It's completely free here on the podcast. And I just wanted to ask if you could do me a massive favor and share this episode with someone else, you know, that might be needing it.

Whether, you know, they're struggling or if they're just in a peer group and.

You guys learn and kind of bounce things off of each other. Look, we can share memes, we can share funny jokes about our industry, but we can also share some useful information. And so I made this podcast episode free completely.

So if people can't afford the book or they're actually really are in dire.

Straits financially, there's no excuse to not have the roadmap to fix their business.

And so if you could just do.

Me a massive favor and get the message out, I would appreciate it tremendously. And if you want to send them to mikeandy.com, they can find it stuff there.

But just send them a link to.

This episode, send them a link to this podcast. It means the world to me. And I hopefully, I really do believe and hope that it would mean the world to them as well.

Here we go. Chapter 12 the business would Die without yout why you don't build a million dollar business Reason 12 the business would die without you Urban Roots Landscaping had made less than $500,000 in annual revenue the year before I showed up. This year, they were on pace for over $800,000 in annual revenue. Unfortunately, this had resulted in growing pains. They were making less profit than they had when they were a smaller business. Last year, they'd made $150,000 in profit. Now, with higher overhead, they were on pace to bring in only $30,000 of profit to the bottom line. They wanted to grow the business to a million dollars, yet it was clear that making changes to the current structure would be necessary to do that. Without the owner, the business would die. Dylan owned the business. He desired more growth, but he was also overwhelmed by his current workload and duties. Michael was the office manager, and Charlie was the project and operations manager. Dylan's primary role should be in sales and estimating. But when I showed up at his shop in the morning, he was also running around. He was helping crews with their equipment and truck setups. Dylan admitted to checking the email and voicemails. He did it before Michael would arrive in the office each morning. Dylan had a hard time delegating and then trusting that someone else could do the job as good as him. Charlie, the project manager, wanted more responsibility. Dylan trusted him. Yet he still wasn't giving Charlie more of a leadership role. Dylan led team meetings. He checked in with the crew throughout the day. He handled many, if not all, the tasks that Charlie expected and was being paid to do. I recommended that Dylan focus only on sales. He could then create defined responsibilities for operations, Charlie and Admin. This would free up time. It would also allow them to take ownership of their positions. As it stood, Urban Roots would die without Dillon. Everything hinged on him juggling all aspects of the business. While we talked, it became clear that Dylan had been overworking himself. He struggled with how much time he had to spend away from his wife and children. It was on evenings and weekends. It was causing a strain on his personal life. Even when he wasn't at work, he was working, always thinking about the business, always checking his phone for emails. His hustle had paid off in the business and it had grown fast in only a few years. But at what cost? He wanted to make more money, to spend more time with his family. But that wasn't happening. Even as the business became more successful. I could relate. When I started Augusta, I never stopped working. I thought I needed to know how to do everything. I thought I needed to write every email. I thought I needed to show up at every job site. I thought I needed to personally ensure the satisfaction of every single customer. Otherwise, I worried the business would not succeed. What I needed was to replace myself with a system. The system would let the business run smooth even when I wasn't there first, let's define system. A system is repeatable process with a predictable outcome. Systems are important. Systems allow the business to continue without the owner being there every day. Dylan became the system and bottleneck at Urban Roots Landscaping. For many areas, this is a common problem. Many small business owners fail to make systems. These systems should be able to replace their daily involvement in the business. If Dylan would replace himself with a system, it would be able to run in his absence. This would give him more time for family. It would also improve the workflow. Employees would not need to run every decision on every job through Dylan. When trying to create systems, look at the sales, admin and operations parts of your business. To create a solid sales system, refer to chapter two. There we describe the entire sales process and how to make it more efficient. Let's look at the other two categories of the business. Operations and admin. When it comes to operations, examine every task you do each day. This includes opening the gate in the morning and locking it in the evening. It includes everything between delegate everything except selling and hiring. These are the highest value tasks a small business owner can do. So they should be the sole focus of the business owner until they surpass a million dollars in annual reven. I often see owners doing tasks that someone else could do. Sharpening blades on mowers, changing oil, checking tires, cleaning out trucks, maintaining equipment each morning before the crew shows up. I've done the same thing myself. I wasted many hours cleaning my trucks on the weekend. I should have spent that time working on my marketing campaigns or hiring more team members. In the early days of Augusta Lawn Care, we were doing about $800,000 in annual revenue. It got to the point where I had to stagger the start time for my cruise. I did this because I was the bottleneck for all projects. There were no systems in place. I staggered the start times because I had to go to every job site and get the crew started and walk them through the job. This involved reading the estimate notes. Then I explained the project scope. Mistakes happened. They were because four to six weeks passed from when the job was bid to when I did the first walkthrough with the crew. I stretched myself too thin. I would forget or fail to include small details not in the estimate notes. Perhaps the customer told me in person to knock on the front door before going into the backyard. They said they had a small puppy that would run out. These small details slipped through the cracks. They led to callbacks and angry customers. Doing job walkthroughs at the start of each project took a lot of time. It took 30 to 60 minutes to drive out to a job site, explain the job and get back to the office. This is why I had to stagger the start times for each project crew. The worst part was that the customer would see me again at the job site. They saw me as the estimator and project manager. So they sent all their communications through me. Questions, complaints. All communication had to go through me. The crew had not built rapport with the customer. So the customer wanted me to be there at the end of the job to wrap up and do a walkthrough. This meant I wasted a few hours at the start of my day and a few hours at the end. I was running around to check in on the projects. I was the system. If I wasn't there, the business would fail. And it almost did when I got in the dump truck PTO accident. Without Liz as my office manager at the time, the business would have collapsed. Everything hinged on me being at the Business every day and on every job. I remember being in the hospital after the dump truck accident. I was FaceTiming my crew on their projects to ensure they knew what to do. The hospital staff must have thought I was insane. I was. I was juggling every aspect of my business. Without systems that could run without me, we began making estimate videos. This fixed the bottleneck and let the system work without me. During the initial meeting with the customer, I would make videos at the job site. It included everything I covered. Where to park the truck and store materials. It also had step by step instructions for what to do. I could also include extra details. These were things I couldn't write in the estimate. For example, the customer cannot walk down the stairs, so go to the front door only. The crew has to have a step by step checklist of the job. They could use the estimate notes and the estimate video. What tools and supplies did we need, what we had to do, and in what order we should do the tasks. We considered it a system failure. If the estimator ever had to show up at the job site, something went wrong. The notes were not specific enough, the video was not detailed enough, or the crew did not connect with the customer. They did not get communication flowing. Customers no longer felt like they needed to contact me with questions and concerns. They would communicate directly with the project manager on site. I explicitly told the customer in our first meeting and in the estimate notes, I said that the video was for the service crew. This set the expectation that I would not be returning. The crew on site were the people they needed to talk to. They had all the information they needed. I, as the estimator, was no longer their point of contact. We have covered operations, but what about the admin side of the business? I often see entrepreneurs doing all the office tasks even after the point where they no longer need to. There are simple fixes for this. Record yourself as you run through your administrative routine. Make a video on how you handle payroll. This includes scheduling, routing, dispatching and invoicing. It also includes the myriad of other admin tasks. You can do this through screen sharing platforms like Loom, Quicktime, Snagit and many others. Then store the video files on the cloud and tag or label each one. This way, if you are not in the business, someone else can pick up where you left off. I recommend getting rid of email and phone calls from your personal phone after hours. You can do this through a full time office employee or or a virtual admin assistant. I recommend trying to hold off as long as possible before getting a full Time office person. Try and use part timers or remote admin assistants until you are past $800,000 in annual revenue. Rent for a commercially zoned piece of land with an office building could cost you thousands of dollars each month. The cost is a fixed expense. It can really hurt in the off season when your revenue falls, but the rent is still due in full. An office has many hidden costs. These include utilities, garbage, coffee, Internet, computers, printers, software and furniture. A good admin assistant or office person can manage your email inbox. You don't need your email inbox on your personal phone. You could be with your family or focusing on sales and hiring. Constantly checking your inbox can also distract from more important strategic work. Is it scary to remove the inbox from your personal device? Absolutely. I still remember the temptation to log in and find out if I was missing things. Avoid getting addicted to the small shots of dopamine. They come from fixing small problems and emails that pop into your inbox. This sort of reflexive and reactive approach to running your business will keep you poor. It will keep you locked in on tasks that could be delegated. Someone else can do them for $30 per hour or less. This way you can focus on $200 per hour tasks like sales and hiring. I see business owners do many admin tasks. They include managing payroll, charging customers and setting up payments with vendors. Also cleaning, ordering supplies, bookkeeping, and checking emails and voicemails. Plus depositing checks, entering customers into the CRM, and responding to web chat. The list goes on and on. One way to disentangle yourself from these tasks is to assign them a monetary value. What would it cost to delegate or automate them? For example, home service CPA will do your payroll and bookkeeping. They'll do it for less than $500 per month. Paying someone to clean the office could cost another few hundred per month. Getting someone to manage your email could cost $600 per month. If they answer the phones and charge a per minute rate, you might spend several hundred more to take that task off your to do list. It might cost you a few thousand dollars per month to get someone else to handle the office tasks. Does that sound expensive? If so, weigh it against the opportunity cost you're currently paying. What's the value of the revenue producing task you could be doing? What opportunities do you lose while vacuuming the mats at the shop entrance or while you reconcile the books? Delegating admin tasks gives you more time. More time means more opportunity to focus on higher value tasks in the business. One reason people won't delegate in their business is is that others will make mistakes or they think others are not as good as them at the job. Think of it like this. By juggling many tasks and roles in the business, you are splitting your attention and focus. You might be 110% awesome, yet if you divide your awesomeness among 20 jobs, you are only 5.5% effective at any one thing versus someone else that is only 50% as good at the job compared to you. But they spend 100% of their time and attention on that one thing. They will likely invent more new ideas and processes. This is because they are not distracted by other tasks. As a rule of thumb, if someone can do any of my tasks at 80% of my effectiveness, then I will delegate that task to them. Yes, that will mean that they will make some errors. When they fail, I will be tempted to jump back in and do their job for them. I will be tempted to get frustrated and reclaim the task as my own responsibility. If I do, there is a short time where I get a sense of accomplishment and being in control. But I will never have the bandwidth to take on new and harder projects or tasks. I will stagnate the growth of my business. Worse yet, I will stunt the growth of my team and their skills. Many times owners will ask me how to create systems that could be a whole book in and of itself. I try to keep it really simple. It is easier to systematize simple processes and services. It is easier to systematize something when it is standardized and done the same way every time. Before you create systems, ask how can you simplify and standardize your business? This will help you create a system that consistently delivers the same output. If the business falls apart when you are gone, it means no one knows what they are doing. If they don't know what to do, they will make mistakes. If they make mistakes, your business will lose money. Do that cycle long enough and you won't have a business to speak of and will never get to a million dollars in annual revenue. Here's the reverse. If people know what to do and there is a system in place, they won't make mistakes. If the system works, you will make more money. You will also have a much better work life balance since you can step away from the business if required. Without this ability, your business will feel like a ball and chain. It will restrict you from spending time with your family, going on vacation, or sleeping in. If you can't leave your business without something breaking, you have a problem. If the business crumbles without you, the situation is unsustainable. Creating systems around operations and admin work is the solution. Until then, your business is a ticking time bomb. Its fuse length is undefined. If you get separation anxiety when you are away from your business for more than a few hours, it is also an issue. Effective systems allow you to pursue revenue producing tasks. They also let you focus on your personal life. With good help, you don't have to worry about what's going on at the office. I understand the anxiety many business owners experience. Trust me though, the only way around this is to make systems. Their output must give predictable profits and happy customers. These processes will allow your business to run without you being there or in an emergency. Start with delegating administrative and project management tasks. Sales are usually the last thing business owners delegate. You can build a million dollar business without handing off estimates and selling. It is the lifestream of the business and determines top line revenue and bottom line profit. For most business owners. They can get past a million dollars in yearly revenue before delegating sales. Once you surpass a million dollars in revenue, take another look at Chapter two. Think about ways to systematize, automate and delegate aspects of your sales process. At that point, you can improve sales more and take your business to the next level. For now, focus on figuring out ways to disentangle yourself. Delegate admin and operations tasks. Only by focusing on high value tasks will you be able to build a $1 million business. Only by having systems in place will your business not die without you being there. 247 365.