Copilot Mastermind 02/15/2025

Ladies and gentlemen, welcome to another Copilot Mastermind. Let's go ahead and jump in. We are just a couple more weeks away from the customer portal for estimates to be released to everybody. Really looking forward to being able to share that. We've been obviously for the past year. It's been almost exactly one year since we stopped doing feature development at Copilot and really focus on the infrastructure in the back end, stability, bugs, etc. We've had to go slow so we can go fast and so you're going to see throughout once we release the customer portal. But then we have a lot of stuff coming down the pipe. It's going to come pretty quickly here as we head into spring rush and so really looking forward to sharing with everyone and it's going to be fantastic. So thank you the customer advisory board, those have been giving feedback the beta groups. I'm really looking forward to sharing it. It's our first one and like I said we're gonna, we, we've gone slow so we can put the guardrails in place so as we develop it'll be done really well. So we have the estimate estimate side of things. Inside the customer portal there is the Field Force mobile app that'll be allowing for offline mode and the wait list. Those are kind of our main initiatives as we head into the spring rush that we're working on. And yeah, there's a lot of good stuff in in the works as well. So let's go ahead and jump in the day though. We have five questions that got submitted on the Mastermind. As always down in the description of this video is a link and you can submit a question there anytime. Also if you go to the very top of the Facebook group there is a featured post that has this link in there as well. So anytime you have a question, marketing, hiring strategy, anything that's business, feel free to submit your question. First question is from Klein Lawn Care and snow plowing. After freezing rain and above and below freezing temperatures we get calls about driveways being a sheet of ice asking to be salted or anti skid spreading. Sometimes it it's out of our normal coverage area. Also one time or on call service though often can be scheduled during a time when we are not doing other profitable work. For your perspective. From your perspective, what is a successful formula for this to be a more profitable service? Knowing not all my providers stock anti skid and the ice is normally thick ice of salting if salting usually one man in a loaded truck can be a sketchy Drive on hill covered in ice. We try to educate the potential customer about it's not recommended to use salt on a gravel driveway or parking lot. Do it make the ground soft during wet seasons even though it is taking talking ourself out of work at times. Or that using anti skid is only a short term solution. For instance, after a sunny day sand and gravel will melt into the ice and then become an icy IC again and will need to be reapplied. Any suggestions simple ways to explain this and what kind of value would it add to put on a website and. And would anyone read it? Yeah, this is a tough one. So when we look at the three different types of revenue you have one time jobs, you have reoccurring jobs and you have recurring jobs. This is a reoccurring job, meaning that this will happen more than once, but it is infrequent. The challenging part with reoccurring work is that usually it is emergency based. So these are repairs. So if you're doing plumbing, this is a pipe bursting, that's a reoccurring job.

And so the question is how do I potentially make this a recurring job? By being more preventative. So ideally salting before snow or icy weather comes and making it, you get ahead of it. So I would be really encouraging that that's from your perspective the business though from the customer's perspective, unfortunately they are not going to think about their, their pipes until one of them bursts. That's just the honest facts. And so people don't think about their driveway until there's a sheet of ice. So what I would personally do is take every single person that responds for reoccurring work and try to sell them recurring work. In other words, hey, last year we had to charge a $200 to come out here and do salting. Why don't we just go and get you on the schedule? $60 each time we come out. Whenever the freeze, the Temperature is below 35 degrees, we're going to come out and we're going to salt. That way that doesn't happen again and you get ahead of this whole issue completely. So that would be what my goal is from a business perspective, from a customer's perspective, honestly changing customer behavior, like are they going to read a whole bunch about anti skid or about the ice and all that? They, they just usually don't. Honestly, in the perfect world they would, but they, they usually don't. So let's go ahead and make this a little bit. There you go. All right, next question is From Adam Burkett, Pristine green lawn and landscaping For GM compensation, Would you vary the percentage of distributed cash that they get based on the size of their location and how much would you how much would be needed to help them.

And how much you would need to be helped? Okay, I got you saying. Okay, you're saying, would you vary the percentage of distributable cash based on the size of their location when they joined, as well as how much you I helped them on a daily basis? Or would you keep the distributable cash the same for all locations and just give them a monthly bonus for hitting certain revenue goals or a combination of both? Would you pay out distributable cash bonuses until their location reaches capacity, or just do revenue bonuses until they're at capacity, then start giving distributable cash? I'm much more of a fan of doing revenue bonuses when they're growth mode and then doing distributable cash once they're in profit mode. I talked about this at conference. So basically for everyone that wasn't there, there's three ways to do GM compensation. One is revenue incentives, two is profit sharing based upon the P L and three is distributable cash. Distributor cash is we determine what percent, how much money we need to be in the bank account and anything over that at the end of the quarter or the month is going to be distributed and then they're going to percentage of that and the rest of it would go to owner distributions. So.

When I went through the three different types, you'll notice if you're over 50% of growth per year, 50% year over year, I usually am having to do revenue incentives because there's not enough profit to actually have a program around. So usually revenue incentives when you're in growth mode, if you have a bunch of debt and and or you're growing like 20 to 50% profit sharing on a P and L makes a lot more sense. The reason I do the P and L if I have a bunch of debt on the business is because I don't want my general manager having to pay for the fact that I have a whole bunch of debt and debt payments. The actual principal doesn't show up on a P and L, only interest expense does. But if you're in profit mode, you've paid off most of your equipment, you're growing less than 25% year over year. Distributable cash is the place to be. That's really where I want to get the location. So usually to Keep it.

Simple. I'm going to do revenue based incentives. I do it based on bands. So like once you get over 20,000amonth, you unlock a bonus over 40%. 40,000amonth, 60,000amonth, 80,000. $100,000 per month. That's how I do it. I do it that way. So that way there is no bonus incentive revenue for revenue under 20,000. Because I know that usually if I'm starting a location from scratch, I need at least 20 grand a month to cover fixed expenses and my general manager's wages. So that's what I do. It's not necessarily, it's right. But I usually like to do revenue incentives where I'm growing a bunch because that's what my focus is. And then I switch to being much more about and like, I'd be very careful being revenue incentives and saying you're also trying to be profitable because you want profit. But your general manager is literally incentivized based on closing more jobs that potentially might be unprofitable. So I'd be careful with that.

Next question is from Cody McLeod from Proscape Lawn Care and Landscaping. We have five employees and two owners. You say go to capacity and raise prices. We have two milling routes that are at capacity and one that we are trying to fill this with. Fill this Summer with marketing. 335k revenue, 2024. Projected to do 500k in 2025. Do we treat each of these mowing routes as separate businesses or wait until the third route is full before raising prices? I don't like to look at separate routes as separate capacities. I don't like this unless. Unless you have a very, very wide service area. And we're talking like way over here is. Is one route, way over here is another route, and way down here is another route. In that case, you want to look at them as three different capacities because you can't really blend the routes. But if I was you, I would just say, okay, we're at capacity. If we literally just moved a few of these jobs on this route over to this one, got a few more jobs in that route. Now everyone's at capacity. The reason I do this is because most people can't figure out capacity for their whole business, let alone for every crew. And so. And you don't want some of your crews to be having high prices and others not so simply because you started one route sooner like it started marketing in that area more often. So I'm looking at distributed across the whole business and we're looking at Again, we're looking at asset capacity, personal capacity, and we're looking at labor capacity. And so essentially how many more customers could you take? We're like, well this route could take three or four, but this one, this one's full. I would just say, okay, as a whole we can take three or four more customers and I'm going to move my routes around to ensure that I then make them as efficient as possible. But the only way that this would actually make sense is if you were really, really spread apart in your service area and then being able to move two or three or four jobs from one route to another is like very prohibitive in terms of geography. Geography. Like it's like you're like, well that's gonna be a 25 minute drive to go get those few extra jobs. But I'm, I really would encourage to look at the whole business otherwise it's not fair to your crew either if you're doing paid for performance. Because now all of a sudden these guys are getting, are charging $100 an hour, these guys are charging $90 an hour, these are charging $80 an hour because of different routes. I wouldn't suggest that again, only assuming, assuming you're able to move some of these jobs between the different routes without it being like super prohibitive in terms of scheduling and routing. Sam Gustin from Troop Smoing, what are your thoughts on having a different sales CRM, HubSpot for example, and utilizing Copilot all as all things operations and scheduling. The reason being in case an active customer unsubscribes from our upsells but then will not be able to receive additional texts from us related to their current service due to them being unsubscribed.

Okay, so I just don't. So first off, there are some, some owners inside of of Copilot that do do this. They use HubSpot for example as a sales CRM because super good at like certain sequencing and like looking at tracking, lead tracking. So that's super helpful. And then they use like scheduling, et cetera, everything on the back end operational wise for copilot. So it's an option. I would not recommend it for smaller businesses like under a million, even 2 million potentially. Like it starts to get a little bit more complicated in terms of the integrations etc. With HubSpot. However, when you talk about the reason being for the active customer, unsubscribes from our upsells will not be able to receive additional text risk related. So you're basically trying to Split the two. I see. You're saying if this is like, if this is the problem, then I would personally do. Let me think for a second.

Well, you could possibly do. Sam.

Yeah, I see what you're saying. Because basically, so basically, if someone unsubscribes on text, then text message won't go through to them. That's how Twilio works. Like, so basically, if someone unsubscribes, it's down. The thing is this. If you split the two, they could still unsubscribe from your marketing. I see. And then you're. So basically you're only two different phone numbers. I think it might get confusing to customers. That's my only concern is if you have two. Basically what you're doing is you have two different phone numbers, texting them, one for invoices, estimates, etc. The other for marketing. I don't, I personally don't think the percentage of people unsubscribing is worth doing this.

Because what you're really paying for is a person unsubscribes from advertising and still wants to receive estimates and invoices. And I think the number of people, the percentage of people that unsubscribe from texting is low. Based on what I'm seeing, it's single digits. And then you also have to assume then that they are still wanting to receive invoices and estimates. Usually people don't unsubscribe if they're a customer that's also wanting to get estimates and invoices from you. So that percentage I would, I would, I would guess is between 2 and 3%, because let's just say 6 to 7% of people unsubscribe from text as a whole. A lot of those people never want to do business due before they've moved away. They just like, there's, like, they don't want any messages from you. It's rare that someone that also wants to get estimates and invoices from you is going to unsubscribe unless you're blasting them with text every week. Like if you're, if you're messaging your, your customers once a week from Copilot, this unsubscribe rate isn't super high for texting. And so, yeah, that would be my 2 cents. I don't think that this is a problem big enough to go through the whole problem or the whole part of trying to integrate everything, have sales separate from operations. This can get confusing from a office perspective because when, now it's like Is this, does this go into HubSpot? This is going to copilot. This can get a little bit confusing so I would just be careful with that part. I just don't think there's a big enough problem to warrant trying to like split the admins attention because you're really just trying to solve for people that unsubscribed and still want to see estimates and invoices and I think that population is low and unless you're like saying a lot of text messages.

Will Kelly Military line cuts for profit distributions. This year I was going to roll out this bonus structure. 10% of annual income equals operating costs that need to be left in the bank. Okay. We would make this a fixed number for the entire 12 month period. So on an $80,000 business, anything above 80,000 the bank each quarter we paid as bonuses. Do you think doing it this way and would you recommend this? I was originally going to the average of the three previous quarters but Q1 would wipe us out if we did that. Okay. So first off like I would address the fact that if Q1 is that low, we really need to solve that. I would also say in when we do quarterly distributions we do reserve the right for the owner to to forego distribute distributions on any quarter. So we did this originally when my locations had much more off seasons and that was okay. Usually during Q1 we're not doing distributions and I wouldn't be able to make that call because you're like well if our revenue dies way down but our cash is still high. Now I'm giving out massive bonuses simply because the average the last three months is low. So you could do average last six months. You're basically doing the average last 12 months but you're not doing it rolling. The reason I like rolling Will is because if you have a rolling, if you're and you're growing the businesses, it'll increase over time doing say $80,000 a month for the next year. Anything over that gets nice and easy. I'm okay with it. Totally fine. Just be careful if you're trying to grow the business a lot because now all of a sudden if the business does 200,000 in monthly revenue and you're still only having 80,000 the bank you're actually in like a really strapped cash position. So just be careful with that. I would say what you're doing is definitely safe. If you are in profit mode and you're not growing very much, it'd be a little easier to keep track of as well. So totally fine. I do the rolling three quarters. So that way if the business is growing that the working capital is also increasing with it. And then if you have a really bad Q4 collapse, then yes, you'll be. You want to make sure you have the option to forego distributions to prevent. Let's just say you're doing like on average, 80, 90, $100,000 a month. And then during Q4, it's like you do 50, 30 and 10. Well now all of a sudden you literally have $30,000 as the distributable cash limit for those average of the past three months. And you're like, that wipes you out. So you can just forego distributions for that quarter if you wanted to. That's not a bad thing. So you could either A, forego distributions or B, do what you're talking about. Just be careful about what you're doing doing what you're saying. If you are growing anything more than 25% a year. So if you're growing even to a million, you will hit months where you have 140, 150,000amonth in revenue and you'll want to make sure there's more than $80,000 in the bank. So that would just be my caveat. But what you're saying is 100%, okay, I would focus most of my attention if Q1 would really wipe you out. I just be focusing all of my attention on increasing revenue during Q4 collapse. Cause that's what's happening. Your revenues are diving, bringing that distributable cash number way down. And that, that is like the root of it. But as you work on that over the next few years, because it can take a few years to solve Q4 collapse, as you add more services and et cetera, then absolutely, this would be, this would work. I think for everyone else. If you're watching, you're like, what's Q4 collapse? I don't know all of this stuff. Go to mike gandies.com workshop. It's a free course I made and it's going to go through a lot of stuff. We went at conference and that is the five different ways to solve the off season and generate revenue so you don't have this where revenues drop way down. It is the bane of our existence in the home service industry. It's what keeps home service business owners poor. Especially in the green industry. It is. It's when everyone quits. It's when we have negative cash flows. It's all where all of our profits go to die for the entire year during that Q4 and then going into Q1 we now actually usually feel the the be the the weight of it because if Q4's collapse, Q1's financials are just a wreck. So go check it out. It's completely free and I think it'll be super beneficial. I do talk about copilot and several features are super.

Helpful including the upsell feature which right now as you head into spring rush I highly recommend take the time, take half a day, make the upsells. It'll be super beneficial. I like I said we did a sample size 29% average higher income. If someone just had the upsell feature turned on and that is the ability for your crew from the mobile app when they're at the job site to just tap a button and immediately send a text or email to the customer upselling them into a different service that they see that they need on the property. And if you're afraid of them sending it directly to the customer, you can have it where from the dispatch board you have to approve that email or text before it goes out, which is totally fine. But if you're a solo operator, if you're out in the field and you and you're doing the work yourself, I would a hundred percent remove the requirement for approval and just immediately have or when you tap a button it's sending a text or email to the customer. I would do that text as completely no pictures and no links. I would do it just text only and like three to four sentences max and make it seem very very personal. Hey Mr. Jones. Again use the merge tags for customer name first customer name.

Hey Mr. Jones, was at your property today. Noticed you might you had some weeds in the flower beds. I'm in the in the neighborhood. Tomorrow I'll get an estimate set up for you and put together. I'll email it over to is. Again merge tag is phone number a good number to text that over to. That's the type of thing that you can do. Make it super, super personal and personalized and they will respond. Don't put pictures, don't put videos, don't put like a bunch of flashy marketing whiz bang text in there. Just focus on a personalized message to them. They will respond. If you say your crew was there and they noticed this, they would love to get this done for you. These are the type of ways to upsell increase revenue without spending any more money on marketing. And I highly recommend it. All right everyone look forward to sharing here at the end of February the new changes that we've we showed a couple months ago when we were getting putting it together for the estimates inside the customer portal. The customer portal is the place where all your customers see all of your information is the highest impact we believe because it's actually affecting your, your your customers and your close ratio and money actually being flowing flowing through your business as well as estimates getting accepted. So it's our first place to start and we have gone slow and I do believe here once we get this one out and as we go into spring rush you're going to start to see us go fast. The team's been working very hard. We're been getting engineers basically almost every week now being added to the team and so velocity is going to start really picking up. So appreciate all tremendously. Hope you have a fantastic rest of your weekend. Hope you had a great Valentine's Day and we'll see you next week. Take care.