LANDLORD & LAWYER ISSUES!!! 😡

Today is a very important day and it could go very wrong.

I'm actually headed down to the Mount.

Vernon location, another location I own for Augusta Lawn Care. And I'm meeting with the landlord and this could change everything.

Honestly, I'm really hoping that they don't make us pay a bunch of back rent for stuff they think we've done outside the lease or like say we have to leave within three days because I don't have the other property. And that I'm thinking about ready for at least another four weeks. So that's really what I'm stressed out about.

So I only come down here once a week, typically on Mondays. This location has right now just a few employees, but we'll ramp it up to probably five or six next spring. Now, you might have seen the video when I was here several months back and I Talked about having $300 a month as a rent.

Well, that has changed.

They ramped it up to 800 and now they want to ramp it up to $2,000 per month. Now this location, we're not really trying to grow to like a million dollar business. We're really probably going to stagnate around that $500,000 in annual revenue. And the goal in doing that is to be able to have the general manager actually working out in the field throughout the day at least three to four days a week. One or two days a week they're going to do drive by estimates. But that's why we're not trying to grow it massively. Keep overhead as low as possible by having even the manager working out in the field and then command center taking all the calls, emails, scheduling, invoicing and all the back end work for the office side. Whereas if you have a $1.5 million operation like we do up in Bellingham, you're going to need a full time manager and estimator just to keep enough jobs and manage the cruise throughout the day. Now don't get me wrong, I think it's totally fine if they raise the rent and it's probably worth that much money. There's a commercial lot on a highway that is probably a couple acres and would otherwise be turned like a gas station or a grocery store. I understand it's worth more than 300 and for those are like, well, why didn't you sign a long term lease? I tried at 800, but they didn't want to. And understandably because they wanted to leave their options open and in case they wanted to ever develop the land and make it into something more than Just storage. However, last weekend I was out of town in Memphis for a franchisee meetup and we got a call from command center that they, the GM forwarded to me and like, hey, the landlord says we're not paying rent. They're threatening to come, like, block us from entering the property. And I'm like, we sent the rent $800. Here's the picture of the check. So I had text the actual property owner and said like, you gotta look at the lease. Because things that were said inside the lease, I've been abiding by it. It says I'm allowed to dump, it says I'm allowed to update vehicles. Those are the two things that you don't like. But they're inside the contract. So I don't think he actually read it. The thing that kind of annoys me is that they told commandster that I was trying to evade them. When in reality I've been trying to meet with the property manager twice and they just haven't showed up.

And I get it, people are busy.

And all the rest of it, but don't say that I'm trying to evade or trying to get around you as.

A landlord and a property manager or.

When there's been twice where we set up times to meet at the property and go over things together and misunderstandings and you haven't showed up. So literally in five more minutes I'm supposed to be meeting the property manager. We've set up a time for 8:30am the crew's already rolled out for the day and gonna see if hopefully they show up. Because I just wanna go over, hey, here's what we're doing.

Here's what's on the lease.

The wild card that I have is the fact that I have a property not too far away from here. If we need to move, we can do that.

And we're probably going to.

I've never to like make someone look bad or do anything malicious or evade people. I just want to be a good tenant. I know it's like to be a landlord and have bad tenant, I don't want that. All right. The property manager just left. It went amazingly well. I was not expecting that at all. I actually expected it to go really bad. Just the way like we it. So this is how it happened. So I was getting on a plane, my second flight from Houston to Memphis. That was when command center got the call from the landlord. Then literally he's saying he's going to have the police come and block access to the property. We get on a Three way call with the property manager, had a bunch of discussions, not so happy discussions about the contract and the misunderstanding of four versus eight trucks, the dumping, all of that. And I did not expect this meeting to go well. I really did not. It went fantastic. We gave our 30 day notice, told him, hey, I'll get out of here, I'll clean things up. And it went really, really, really well. Like massive bullet averted. Because I was afraid that they were going to try to like back rent me for a long time and, and try to get more money out of me. For the past few months we've been here, crisis averted and we're going to.

Be moving out of here.

We're going to find a new shop location. Not find one, we already have one. It's about five minutes drive from here. And we're going to hopefully move here, move there in August. So you'll see that next month. We still got work to do there in terms of prepping for the gravel and everything. But big crisis averted this morning. I'm actually really shocked, to be perfectly honest with you. I'll show you what we were kind of discussing or like had disagreements about. So we only have six vehicles. We have three guys out right now, so that's why a few of them are still here. And then they had said that they wanted only four, but in the contract he said eight. I'm like, look, I'm still fine. This back area, they just scraped all of this with a bulldozer, put all the debris here. This stuff up front though is all of us, all the clippings. And I think the landlord had thought.

We weren't supposed to dump.

And it's like in the contract says we're allowed to dump clippings. And I'm sorry that there's a couple bushes, but it's all clippings. And all this stuff back here is just the scrapings from what they did with the bulldozer. So we just kind of ironed all of that out and ended very, very well. 30 days new shop for this location. It'll be good.

Like I said, the goal for this.

Location is only about five to six employees, 500 to 600,000 annual revenue, and having the manager where three to four days a week, he's still out in the field working and can be really profitable doing that. That's going to be next year. This year is about stabilization, getting mostly recurring work, stopping scheduled estimates and larger projects and just making this a more cookie cutter, simplified services and profitable business. And so next year is really where the profits will actually start coming in. This is all about stabilization. So first crisis of the day averted. Fantastic. Now got to talk to attorneys, because attorneys like to charge you a lot of money and sometimes you need to negotiate. And one of the biggest costs we.

Have at Augusta is attorneys. So it's time to negotiate finding a different provider.

Sorry, but your law firm is fired.

One thing people don't realize is that franchising is super expensive when it comes to legal fe and accounting and all the registration. Because every single state and province that we do business in, we have to register as if we're doing business in that state. So like last week I had to work on Hawaii. This today we're talking to a Canadian franchise attorney because the franchise attorney that we were using before is costing us too much money. And we have a really good relationship with our U.S. attorney and we get a good deal.

And some people don't realize how much.

It costs for us to go through all the legal documents, register in the state. And all the rest of it takes time, money. And every single year we have to renew in every single state. It's a big headache. We spend multiple six figures just in legal fees and registration every single year. So it's a bit of a pain. But with scale as yet, multiple locations in each state, it makes it where it's not so bad financially. But that's why it's so difficult. And that's why I've always said you've got to get to 100 locations in your franchise if you're gonna make any money. And that's right where we're at right now. I'm sure some people in the comments, like Mike, you shouldn't be driving for 30 minutes down to a different loc. Should be focused on the franchise. And I agree with you 100%. I shouldn't be spending any of my time on my corporately owned locations because not really a good use of my time.

I should be focusing on the things.

That creating systems and procedures for a hundred of the Augusta locations. And that's why I'm hiring Chuck. Chuck is one of my general managers out in North Carolina that is going to manage my managers and be a support to me so I don't have to do these type of every week meetings.

Now I only go to my corporately.

Owned locations, two of them once a week. All right, so Mondays and Thursdays I have a 30 minutes max at both of those. Not so bad, but still a matter of the more I can get off of my plate at those daily operational kind of meetings that I just stay connected with the team. The more I can put on someone else, the more I can spend time on refining and focusing on the systems of the entire system. And that's important.

But before we contact the attorney, it's time to do a little bit of cleaning. So this is something that when it comes to real estate, I spend less than 10 minutes per week on the real estate. We have 20 units now, kind of have probably 23 or so soon and different tenants and stuff like that. However, I spend less than tenants per week. It does about 35,000amonth in revenue with all the tenants and all the rest of it. And we didn't make any profit for the first year or two because we were like improving all the properties and all the rest. We're still cash negative on it because every single time someone moved out of those 20 properties, I would improve the place and invest in it and all the rest of it. That being said, we raised rents now. Now we're starting to make a little bit of cash flow. However, Airbnb, I spend now about an hour, maybe two hours a week max on cleaning. Now. Why are you cleaning, Mike? You should not be cleaning. That's. So you got to do things that are higher value. Okay, well, maybe you're. Maybe you're right. However, it's only our second month and Liz, the property manager and myself are focusing on trying to create the systems and learning all about short term rentals and Airbnbs. So that way we can teach the franchisees because it's a really good step into real estate. You're trying to. It's a great cash flow vehicle so you can actually afford the mortgage or house hack and pay off your current mortgage and have like a shop, things like that. So Airbnb, we are learning it. We'll have some systems and checklists and things like that and eventually hand it off and not have to worry about as much. But for now, we're just still in the learning phase. So I spend a little bit of time doing that each week. By the way, for those wondering, this is the new set you've been seeing. On Saturdays when I go live and I do phone calls right here. It's literally right in my living room. That is my living room. Let's go. By the way, while I'm here, this was really good. I had a seven day cleanse. All these juices and really kind of breaks the dependency on food and thinking about food all day long. I liked it. It was good. And you say, well, what about your bedroom? This is my bedroom and this is where the other set is at. So multi purpose, we can write the.

Whole place off because it's being used for business.

While I was away in Memphis, someone stole a whole bunch of stuff off my front porch. We got a bunch of Amazon stuff delivered here for the Airbnbs. Totally gone. Nowhere to be found. That stinks. See, I find myself sometimes sitting in a place, looking up in 30 minutes later, realizing that time has gone by. The majority of my day is phone calls, text messages, emails and zoom calls. That is like my job description. So I've been sitting in my car for 35 minutes, answered two phone calls, four emails, and I'm gonna hop on another call right now with the team for the web design. It's a zoom call. We do it once a week. So hopping on that right now. And that's mostly what I do.

Okay. So the call with the attorneys went really good and literally just trying to keep them honest. So went to a different, different firm and we are going to save almost $1700 per signing in Canada. That's super helpful because people think you make a bunch of money on Franchi. You don't. And you actually usually lose money by the time you take all the registration, legal and everything else that goes into it. All the training stuff. So really good that we can sharpen their pencil on that because we do just charge Canadian dollars on our franchise fees. And after the Exchange rate of 20, 30% coming off from Canadian dollars, it's pretty skinny. So, all right, just walk into the command center here, see if the media team is slacking off or not.

That's the world's best interview. Oh, no. We have two of them at the same time.