Hiring Your Second Guy - Ep.38

Hey everyone, this is Mike Andes and you're listening to the Landscape Business course podcast. And sorry I haven't been uploading as frequently as usual, but I did want to jump on today because I got a couple good questions about employee employment and then it kind of good segue because tomorrow Tuesday we are having a webinar, a live webinar. And so you want to make that. Well, we're going to be talking about how to hire All Stars without breaking your wallet, essentially how to have a hiring process. What steps I have taken to create the team that we have, we, we have somewhere between like 10 to 13 people, including some of the part timers that work with us. So we've used the hiring system and it's worked really well. And so I want to share with you how to have a system in place to onboard and retain the right people. So today though, we had a question come from Joe Bauer, which is one of the members, one of the course members at Landscape Business Course. But if you are interested in joining the live webinar tomorrow, it's completely free, just go to landscapebusinesscourse.com I'll probably share content for like I'm guessing 15, 20 minutes and then we will jump right into Q and A. So if you have any questions on how to start, grow or save your landscaping business, make sure you hop onto the webinar landscapebusinesscourse.com Sign up today. It's completely free. Joe wrote in on email and he said, hi Mike, this is Joe from Joe Lawn Care. I started landscaping. I took your course this past winter and helped a lot. Just had a quick question because my business took off really quick and I just hired my first full time guy. But I'm not sure when it is good time to hire a second guy. If you give me a call or email, that'd be great. Thanks Joe. So I will probably follow up with you, Joe via email. However, I want to answer it here on the podcast because it's a good segue for tomorrow's webinar. So first of all, I would say hire. If you can afford it, hire the second guy right away. Like the sooner you can get in the frame of mind of hiring, it's better because the first guy, if you have one full timer, you're still in the field as the business owner. You'll still be working a lot.

Now when you get your second guy, you'll start shifting more and more towards the administrative office, estimating marketing, things like that. And that's a good shift to have and you'll get more in the rhythm of hiring more people. That's a good thing. Now, I would be careful, though, because you don't want to. The one negative drawback of hiring a second person is sometimes you haven't invested enough time and energy and training into your first person when you start hiring your second person, third person. And what you can do is if you hire too fast, essentially, those people aren't getting trained correctly. And so that's something I've been thinking about a lot right now, because we are hiring a lot. We've already hired 1, 2, 3, 4, 5, probably like six new people this year. And just in the past couple months, well, a month and a half or so. And so when you're hiring that fast, you want to make sure they're still trained and they're still capable of doing everything that you want them to do. So the one thing I would say, Joe, and you know my spiel on hiring and, you know, the system and everything, but what I would say, the one thing I would say is just be careful that when you. The only thing to be wary of is that you don't train that second person very well because then you're going after the third, and you don't train that guy very well because you're going after the fourth. So part of having a hiring system is having a training system we're going to talk about in the webinar tomorrow. And. But. But if you're going to err on one side or the other, I would rather hire too fast than too slow, because if you're hiring too slow, you're just not going to grow. And if you're hiring too fast, you can fire people if they're not the best. It's not good for morale. That's why you want to have the system in place to make sure you aren't having to fire half the people you hire. But, yeah, so I would encourage everyone out there to hire another person. Like it's. If you can afford it. And sometimes this is a thing, too. When you have one employee, you still have all the same overhead as if you have two. So that second guy, he can jump in the same truck, work with the same equipment. You don't need to buy more stuff to have that second guy. And so you're really just. There's not much more overhead. You don't have to buy another truck for him. You don't have to buy another trailer and mowing equipment like you can. That's usually your third guy. When you definitely need to have at least two crews now, but that for that second guy, your overhead doesn't increase. So your fixed expenses, things like rent, insurance, you know, your equipment costs, all of those things stay the same. And so what you want to do is when you have fixed expenses, rent, all those things you have to pay, no matter what you want to increase. Like the more people you can pump into the system, variable cost, and the more work you can do, the better you make it more efficient. Because now your fixed expenses are a less percentage of your overall revenue or your overall expenses total. So for instance, if you're, if your fixed expenses are 30% of revenue, like, like 30% of what you make is going towards fixed expenses. Things that, like, regardless of whether or not you go out and do work, you have to pay, like I said, rent, insurance, all those things that you just pay every month, no matter what, licensing, things like that, there's all fixed expenses. If you're at 30% of your revenue is going towards fixed expenses and hiring more people, you don't have to increase that. You might, your revenue will go up. And so thus your fixed expense ratio might go down to 20%. Because now you're making more money, but yet you haven't had to buy more equipment or you don't have to get a bigger space or another truck and things like that. So you want to maximize your efficiency. And one way to do that is to increase the amount of money you're making. That's not increasing your fixed income. So essentially, I mean, so your fixed expenses, so what you want to do essentially is when you have a rent, when you have trucks, you want to make sure you're getting the most out of them by having enough people on board, which is variable expenses. So people's salary, I know this is kind of deeper than usual. We go here on financial level and numbers, but variable costs are things that, like, the more work you get, the more you have to pay. So that's like materials, your labor obviously is the big variable cost in our industry. And so you want that variable cost to be the thing that changes. And you don't want your, your fixed cost. So instead of bulking up on equipment for your second guy, I would keep your equipment the same so your fixed costs are the same and then allow that variable cost to be the person's salary or pay or whatever, because their wages, because that way it'll correspond with how much work you get. Your variable costs will go up when the work goes up, and you won't have this massive fixed cost that's with you regardless of whether or not you have the work. So that's my opinion on that. I would err on hiring one more person instead of trying to maximize it with one and you're still in the field. Like when you hit two people, that's when you really start becoming a business. Because you start working on admin, you get out of the field. When you go to that third person and get a second crew out there, now you're really starting to talk about a real business. So Joe, if you're on the, on the landscape business course, you, you, you are on the landscape business course. And so you know that you're kind of in that second year when you're going to start. You really see that jump in revenue. And so you want to feed that with people can afford it. If you can afford not take the money out of the business, then I would pump it into getting more people because that year three, you're gonna do the same thing and that's when you're gonna really see results. So best of luck to you, Joe. We'll stay in touch. I'd love to see you on the webinar, even if you can, tomorrow. I know you're a member and everything. You know, a lot of the stuff about the, the, the, the, the system that we have in place for hiring and training and everything. However, you know, even course members get stuff out of these webinars because you can do Q and A. So if you haven't already, go to landscapebusinesscourse.com, sign up for tomorrow's webinar and I'll see you. We'll probably be on for like 45 minutes or so. It's tomorrow, 9:00am Pacific Standard Time. See you then.