Make or Break! When to Hire an Estimator

Hey everyone, it's Mike Andes. And welcome back to the Home Service Millionaire podcast. This is the podcast for every home service entrepreneur that's already running a seven figure business. Today we're talking about when you're hiring your first estimator and I understand the angst that comes with that. You have delegated other aspects of the business, but now you're starting to find an estimator or a sales manager to handle the in person estimates for you. Now, obviously as the copy and paste millionaire, we want to make sure that we're trying to have over the phone estimates or having instant quotes as much as possible, but there's still going to be times you have projects or you need to visit the customer in person, and that's when an estimator or a sales manager is required. So we're going to be taking five different questions from the audience about this crucial time in the business when you're starting to hand off sales. And I still remember doing this for, for my first location, handing it off to Lee for the very first time. And as much as you wanna train them, as much as you wanna give them all the guidelines and systems, you still kind of cross your fingers and hope in that first couple weeks that jobs actually get sold. So let's go ahead and jump in. Talking to that million dollar operator, starting to hand off sales. Number one, I handed off sales to my crew leader because I was overwhelmed. How do I know if that move was a strategic step or just me trying to offload my workload? So first off, if you're handing sales to a crew leader in this case, and that crew leader was out doing operations with the crew in the field doing the work in operations, rarely have I seen that person want to stay in sales very long. The reason for that is because they came and they started working for you under the guise of we were going to work in the field. That was what they're good at, that's likely what they had skills in. And, and they've probably built a team in the field that they really like to work with. And so when you pull them into sales as much as they might want to or need to, from the sake of making more money or not being out on the truck all day long producing revenue and less physical demands and like, yes, salesperson is a good thing. Sales is a very different skill than doing the work. And so to think that I'm gonna take a crew leader that's out as a technician or even a crew leader that is managing jobs all day long and is Gonna somehow now be a good salesperson. That rarely works out. The skill of a salesperson is very, very different than the skills of a great crew leader. And as much as you want to promote from within, just realize that sometimes you will take a great crew leader and you will put them in a sales position and they will stink. Just because they're good at operations or being a crew leader does not necessarily translate to being a great salesperson or a great estimator. And having the communication skills required, having the ability to follow up, having the fear of rejection, not be as much of a thing that debilitates them from knocking on doors or putting some door hangers around, the estimates that they're doing for the day, doing cold calls. If they're not willing to do those things, it is likely that they are not going to be successful in the sales role. And so be very careful about promoting from within. When it comes to taking some in operations out in the field as a crew leader or technician and somehow thinking they're going to want to do outbound, want to call people, want to do follow up, want to text people, they don't want to feel salesy many times. And those that extra pushing as a salesperson is what's required to really sell the jobs when your crew needs it. And so be very careful first and foremost of hiring someone from the operations side. If you are now questioning you've already hired, it sounds like a crew leader and you're kind of second guessing yourself, like was this actually what I should have been doing? Or is this me trying to just offload my workload? This is when delegating and handing off admin operations or sales needs to be done strategically. And this is why in the copy and paste millionaire book I give actual guidelines in terms of number of employees and revenue for when these things should be done. And you should only hand off sales if you know that by doing that it unlocks the business to do something more. Now in the book I talk about how sales is the last thing you usually hand off. If you're handing off sales, my question is what are you doing in the business after that? Are you starting another location and you're gonna go start another one? Are you serving as the GM and you're working on acquisitions or marketing and advertising, what are you doing otherwise? Because you might be completely overwhelmed by being the estimator in the business. But if you've hired an operations person and you've hired an admin person, my next question is what are you going to do in the business. If you hire a sales, what is that GM plus role going to look like for you? If that's not clear, I would then focus on delegating more operations and admin before letting go of sales. Because you being overwhelmed right now might mean that you're working seven or eight hours per day as a salesperson, but still doing a two or three hours worth of operations, an hour or two of admin, and constantly still juggling those balls. I would probably focus on those tasks to try to delegate them more and optimize them and create systems for operations and admin before I let go of sales. Because when you let go of sales, you gotta have something else to do if you're staying at that business, whether it be other business opportunities or whatever you're trying to do. Be clear on what you're going to do next because that is going to be a huge chunk of your time if you're at that crucial 1 million, 1.2 million in revenue and now you're going to let go of basically what you're doing 70 to 80% of your day. Otherwise you'll become a GM that just is constantly micromanaging and getting into everyone's business because you have nothing better to do. Number two on the docket, my salesperson is closing less than I did. But I keep telling myself they'll figure it out. How long do I wait before admitting I outsourced the most important role to the wrong person? Okay, so I think if you're having this question, I'll come back to like, how to address it Now. I would say though, that we did not train them correctly and we didn't make sure that they were actually good for this role before throwing them into it. This sounds like you probably threw them in this too soon because I before I fully hand off the reins to sales, I'm going to first show them what good looks like. They're going to shadow me doing a bunch of sales, then I'm going to observe them doing the sales themselves and I'm going to be coaching them after every single estimate. By the time they're out by themselves, I should have already had so many reps with them, and they should have had so many reps with coaching with me that they should be a duplicate of me by the time I complete completely delegate sales to them. So I would say asterisks, training and system around showing them what good looks like and doing estimates in front of them and then having them do it. And you pick apart and coach and analyze every single sales process for them. If you do that for several weeks, assuming you don't have extremely complicated six figure projects, you should be able to hand off your sales in a better way. Now it sounds to me though like you are already, you've already delegated a salesperson and they're not doing great and you're like they'll figure it out. I would ask what part of the sales process are they dropping if they are not doing the tasks that are very clear and concrete, like follow up after three days, follow up for 24 hours, make sure the text and the email. If they're not doing the concrete things, I have a really hard time with allowing them to continue. If there's some soft skills that maybe they haven't refined yet, like once they're on the follow up phone call, they don't do a great job of making sure they give an offer. And they keep saying things like making sure you got the quote or just calling to see if you have questions. And they're constantly getting customers saying, oh yeah, we'll contact you when we want to do service. Well, that is something that I can teach. That is something that they will likely get better at with reps. But what I can't train is the fact that they did not do the follow up phone calls. The fact that I can't train that when they're late to a call or late to an estimate appointment that they contact the customer. These are the type of things that I should snuff out though in the training. Like if they are incapable of doing these things or they're so disorganized they can't keep their schedule and maintain their schedule throughout the day. Those are things that I would probably root this person out of the culture as quickly as possible and out of this role. But if they're actively trying hard, they're, they're recording their phone calls. When they do follow up phone calls, they are looking for your feedback on the way that they do their consultations and in person meetings. If they're willing to learn, I'm willing to stick it out with them. And they will figure it out because they simply have the ability to improve and constantly analyze their current performance and make it better. One of the major reasons people don't wanna hire an estimator is cause you don't have your eyes on every project. And when they get accepted, you don't know exactly what they look like and where they should go on the schedule. That's why at homeworks we've created two different features. One's called the wait list. The other is called unscheduled work. Now, when you walk in on a Monday morning, instead of filtering down the estimates by which ones were accepted, then going into each line item and seeing how many budget hours, and then going back to the calendar and scheduling, no more. You go to one page and every single line item of every single estimate is there that's been accepted and not yet put on the schedule. And sometimes you don't know exactly where that job needs to go. If the estimator's out in the field and they got a job accepted, cool. That might be somewhere next spring. I can throw it on the wait list with a parameter of time of when it needs to get completed, and I'll get alerts when that time is getting close. Wait list, unscheduled work. Brand new features just released at Homeworks. Go check it out and see if joining Homeworks is the right fit for you. Number three on the docket. If owners shouldn't give up sales early, how do we stop burning out while we're still running estimates, closing jobs, and managing the team? So this comes back down to what the copy and paste millionaire does in general. I first delegate admin. When I say that, I mean I delegate admin, and then I optimize it. I think sometimes people think, oh yeah, I delegated, I got an office person, and then the next month I got an operations manager. Or like the same month, I kind of did it the same time. And then very quickly I'm looking for a sales manager. In my opinion, I'm gonna get an office manager and I'm gonna make sure that every single time they contact me about anything, a complaint, payroll, tax, anything, I'm gonna be trying to fix that problem. Cause there was a system breakage. If they're contacting me, I'm gonna try to optimize that role and then move on to the next leverage task. So admin being first and then operations. So when I get an operations manager, they lead the team meetings. They, they do one on ones, they do the hiring, and if not, I don't move on to the highest leverage task yet, which is sales. And what I see some people do is they'll delegate like 50 to 80% of a role. So, for example, an admin, okay, you will handle the email, you will handle the phone calls. But I will still run payroll. I'm still gonna do the accounting and the QuickBooks reconciling of the accounts. Great. Now I've taken care of admin. In your mind, you've delegated it when really you've only let go of 50 to 80% of the work, and that other remaining percentage is still lower leveraged than what is operations or admin or sales. And so then what happens? You've now delegated 50 to 80% of admin. You now jump into operations. Okay, you still lead the team meetings, you still do the hiring, but you expect the crew to be able to report to your operations manager for, like out in the field, walkthroughs with the customer complaints. If equipment breaks down, if they forget something, if they need materials or equipment moved around, they contact the operations manager. So again, you have delegated 70, 80% of operations, and then you get to sales, and you wonder, man, I'm doing sales all day long. But really, you're still doing 20 to 30% of operations. You're still doing 10 or 20% of admin. And so you get stuck in this place, which is exactly this. How do we stop burning out while still doing running estimates, closing jobs, and managing the team? I want to get as close to just doing estimates before I think about delegating sales. And this is why I see some people trying to hire an estimate at like 6 or $700,000 in revenue. And they have someone in the office and they have like a crew leader, crew operations manager. The reason is because they've delegated about half to 80% of admin and operations, and they're still doing all the estimates. And I feel like they're just completely booked. I'm working 12 hours a day. No, you're working seven to eight hours a day doing sales. And you're also working two to three hours a day on operations and a couple hours each day doing admin. I would first, before I delegate sales, which is the highest leverage, highest value task you can do a business, and that is getting new work in the top of the funnel. Because without it, you don't get any work to do operations. And you don't have anyone calling you admin, email phone calls. Like, nothing goes through to admin if you don't get the sales. So I'm gonna protect that to the last thing I let go of. But in order to actually delegate sales, I'm going to first make sure I've actually delegated all of admin and all of operations. So I would first analyze each of those roles and ask yourself, what am I still doing in operations? Delegate that before you delegate sales. What am I doing in admin? Still delegate that before you delegate sales. Because these tasks that are Currently not being done by your manager in those roles prevents them from taking ownership and accountability for that role. And if you delegate sales and will do the same thing, likely 70 to 80% of estimates will be handled by your sales manager. Now, the GM is simply the fill in for all three roles. And you're constantly running from place to place. Extremely inefficient, extremely unprofitable, and most importantly, your mid level managers at each of the sales operation admin roles don't feel like they can do their job without constantly reporting back to you. Number four on the docket. My GM keeps complaining they're too busy to do sales. Is that a sign they're actually overloaded or that they're not the right GM for scale? Okay, so before I would consider this a GM problem, I would ask yourself, how have you built this business in a way that sets them up for failure? So if you're asking a GM to manage without any other managers, just one manager, 12, 14, 15 people, they're gonna have a hard time and you're gonna be expecting a unicorn for someone to pull that off. Most of the time people can manage between six and eight people effectively. So if you're going to expand past 10, 12, 13, 15 people, expect to have to hire more managers. And this is why the jump from working GM to a GM plus model is a big jump. Because I've gotta get these mid level managers that cost me a bunch of overhead and, and that's usually that jump when I start crossing eight, nine, ten employees. Okay, I need an admin person. I need someone to help me out in the field in operations. And that's when you have to go to the GM plus model and scale to 3 million. And so in my opinion, if someone is feeling overloaded and they have five or six employees and they're the gm, they have five to six technicians. If they are saying they feel overloaded, the first thing I'm going to do is ask why not to them I'm gonna look at the business. For example, are there a bunch of inefficiencies that are causing this? One thing to look at is the trucks and equipment that you have. Are they always breaking down? Are they hard to schedule and route? Cause every truck is different, every single setup is different, every piece of equipment is different. That makes it a lot harder for a GM to do their job. I want my GM to be able to lead the team and produce, work out in the field when it's slow. Everything else I'm trying to reduce and get off of their plate. So if I'm requiring a whole bunch of in person estimates, drive bys, I'm going to try to get that over to over the phone estimates or instant quotes so my admin person can handle that. I want that off of their plate as much as possible. Also, if I have a whole bunch of trucks and equipment breaking down because they're 15 years old, this might be the time, assuming I'm in profit mode, to now go out and get some trucks or get some debt on equipment that is going to reduce the amount of downtime and the amount of management of a bunch of trucks and equipment that constantly are breaking down. So I'm always trying to first before I blame the GM for not managing their schedule very well, I'm going to look at these aspects of efficiency and reliability of the trucks, the equipment and the team to ensure those things are optimized before then I say, okay, you have new trucks, you have new equipment, your crew has all been here for a good amount of time. What are you doing? Like you, oh, I'm so busy I can't actually get anything done. Like I can't do the follow up phone calls. Like you have four or five employees, you're doing 60,000amonth in revenue, you should be able to do follow up phone calls. A bunch of your estimates are over the phone. A bunch of your estimates are instant quote, you're talking about three or four in person estimates, maybe max per day, you can handle that. And if you know that you have optimized every aspect of the business, your pricing is on pace, everyone in the field is on pay for performance and making bonuses so they don't have to micromanage their crew. Assuming you've checked all these boxes, then and only then can I look at the GM and say you can't manage your calendar and we've got to dig into that. But before I do that and start doing a massive analyst and forensic on their calendar and their management style, I'm first going to try to optimize everything I have control over in terms of the trucks, the equipment, the team, the route efficiency, making sure the team is incentivized on pay for performance and profit sharing and open book management. I'm gonna do everything I can there. And then if they still say they can't get sales done and they're only managing six or seven employees, I am going to look at their calendar, I'm gonna ask them, okay, can we do time blocking? Can we actually figure out what hours of the day you're Available for estimates what hours of the day you're available to help the team out in the field, manage the crew, train the, let's actually time block all 40 hours of your week. I would only do that though if everything else has been optimized that I can control. Because if I go there first, they're going to feel micromanaged. So if you go to your gm, you're like, hey, performance is not doing great. I'm not seeing do follow up phone calls. Let's go ahead and analyze your, your, your, your calendar. I want to pull up your calendar. Let's see what you've been doing and you start looking at it. And like if that's the kind of notion that you have towards your gm, they're going to get frustrated, they're going to feel like you're micromanaging them. However, if you first say, hey look, here's where we're going off on the metrics. Let's look at the trucks. Is there too much downtime? Do we have too much maintenance? Oh, do we have too many different types of trucks and equipment that it makes it hard for you to schedule? And you're bouncing around the dispatch board day after day, hour after hour. Because every single route is different, every single truck is different, every single piece of equipment. You have to match custom pieces of equipment to certain types of jobs. I'm doing all of that first and at the end of all of that, if the behavior still has not been corrected, then I have to actually drill into their time management. I'm first going to try to figure out all the more tangible things and handing off to a gm. I want to set them up for success. I'll do everything in my power to make their job easier. And usually when I hand off a location to a GM after it's been in growth mode, now it's going into profit mode. I am trying to make sure that the trucks are newer and everything is standardized. Same truck across the board, same equipment across the board, same trailer across the board. I'm making sure that my pricing is optimized, my services have been cut down, I'm focusing more on recurring revenue than one time projects. And that if I do all of those things and I have six to eight employees, I can then confidently say they should have time for sales and if they still don't, then I'll address their calendar fifth and final on the docket for today. At what point do I know if I should delegate sales or operations? I am at 1.2 million and can't do both. So at 1.2 million, this is very much of a breaking point. You're kind of in between. This is why you're probably feeling like you're overwhelmed at 1.2 million to try to do all the things in operations. Training the team, doing one on one meetings, doing team meetings, but also go do the estimates. There's a lot of running around happening and you probably have one person like in the office helping you out. And so what I would do is ask yourself, there's one, there's very, very few times, but it happens occasionally where you're just not good at sales and you love operations. If that's the case, I recommend the entrepreneur stay in operations and go hire a salesperson. And so in general, I would say for the vast majority of people, 90% plus of entrepreneurs, they should keep sales and hire someone to do operations, manage the crew, do the meetings, hire, fire, et cetera, all operations. And, and they stay in sales. I say that because it's usually harder and more expensive to find someone that can do the sales role at the level that you have been. And so if you're between like should I do operations, should I do sales? I would say most people should probably hire an operations person. They're easier to find. You can usually hire from within your technicians into that management role. Cause they're still out in operations and it's usually a cheaper role to fill. I would say that for 95% of people, for a very few select people, and I don't even say this in the book because it's so rare that you are so good at operations and dealing with people, but you hate sales and you're just not good at talking with people. Then and only then would I go out and hire someone at a pretty high compensation level to replace the sales function of the business. So I would say the only way that I would hire someone in sales and you go into operations is, is if you stink at sales and you don't like it. If both of those things are true, there's a good chance that you're stuck at 1.2 simply because you're not good at sales. And if you could focus all of your time attention on operations and get someone to do sales, you go from 1.2 to 2 million very quickly. Cause someone knows how to sell and you get more time with your team out in the field.