Mike Minutes Mastermind 04/04/2022

Hello, Augusta Nation. Welcome to another Mike Minutes Mastermind. Let's go ahead and jump in. Actually, I saw there were several questions that came on the form, so I'll get to those and actually look really good. I'll take a look at those. If you are watching from the Facebook group, I did post a comment with the link to the YouTube, which is sometimes the easiest to watch on just in terms of their interface. So feel free to use that link if you want to watch it on YouTube. All right, let me just make sure we are golden here inside of Group K. Cool. People are live. All right. While some people are hopping on. Let me go ahead and do one thing I had made a note of I wanted to talk about. Then we'll go through the. There are several questions, four questions that came in on the form, and then we'll answer any live questions. So just pull this up. So, yeah, I wanted to talk about. I mentioned a little bit on Friday, but a conviction of the sale. And where did I put it? There it is. Yeah. So one thing that is really important, I think it's really important to think about when it comes to sales, and that is that sales is really just a transfer of conviction. And so whoever has the most conviction in what they are in the transaction, buyer or seller, they're the ones who will get the outcome that they desire. And so if you as the seller are trying to sell something, you have to have more conviction than the buyer, because the buyer has conviction that they want the lowest price, that they want to get three bids because that's what their father told them they should do. And that's the responsible thing to do as an adult is they want to have pride in choosing the right company and making a right. The correct buying decision. They have conviction in all of those things. There's pride involved in that, et cetera. You as the seller have to have more conviction in your product and service than they have conviction in them getting more bids, them getting the lowest price, and their fear of making the wrong decision. So you have to have the conviction that this is the right product and service for this person. And when you have that level of conviction that's higher than theirs. That's when you'll make the sale. That is when a customer says, well, we'll wait for a couple more bids. You'll actually push you. Actually, Mr. Jones, I want to do business with you. What can we do to make that happen? You will not be disappointed. I'm going to do everything in my power to make sure you're Extremely satisfied and we don't have contracts. You can walk away anytime. I'm that confident you're going to love our service. So when you have that level of conviction that your product and service is the right choice for the customer and that all things considered in terms of price, in terms of quality, that you are the right decision for them, when you actually believe that, when you know you're going to care more than any other competition, that's when you can really sell. So let me just make sure that we are live in the Facebook group as well. Perfect. Okay.

Okay. So I wanted to kind of go over that first and foremost because if you're like, man, like people always asking about no price or saying they need to talk to somebody else and they talk to their spouse, like again, their conviction that they need to talk to their spouse is greater than your conviction that your product and service is better is the best option for them. And so this is why so often when a seller or a salesperson has a high level conviction and they've used the product or service, that's why they usually make the best salespeople, is because their level of conviction is so high versus someone who just learned about it, like, okay, this is a script, here you go. And the people that are like that, that's who come across as salesy quote, unquote, is the person that is going through the motions of sales. That's why when you go to a dealership and they're selling you Porsches, for example, or really nice car, a lot of times it's very hard for those salespeop to actually have conviction because they don't use the product, they don't have the Porsche and therefore it's hard for them to sell it because they do not have the conviction. And so when someone says, wow, this is too expensive or Tesla makes a better car or can you give me a better price, they just crumble because they don't have the conviction in the product. So does not mean that you need to use the product, but you do need to believe in the product in order to have conviction in that sales process. So the first person you have to sell on your lawn care, your landscaping services is you. If you sell yourself that you are the best option for the customer, you'll, you'll sell from a place of conviction and duty to make sure that the customer comes the correct decision instead of oh, I need to get this job to fill the schedule or whatever it might be. And when you sell from a place of conviction, you will push you know, and it will not come across sales. It'll come across that you actually care about the customer. It's in their best interest. So. All right, let's go ahead and jump into a couple questions that came in on the forms. Let me just pull these up. Boom.

All right, again, if you want to do these anonymously or with your name, totally fine. But let's see here. So first question here from Max. It looks like will Zooper have the ability to automatically populate addresses based on the street and house number? For instance, in Jobber, when you use a house address, it automatically suggests the city postal code, et cetera. This would save time at CC and reduce spelling mistakes. Yes, it does. It pulls data from Google automatically in Zooper. Will Zooper be able to charge cards automatically for recurring work using Jobber as another example, when I had a mowing job that repeated every time I hit Complete on the Jobber app, the client's car was automatically charged. This reduced the amount of time spent invoicing and I would love it if this feature could exist in Super. It was also awesome for cash flow. Yep. So this is something we have on our list with super, but it's not super high priority. Here's the reason why this works great as long as you are solo or maybe one or two employees. Personally, even if this feature exists inside Service APA, I would never use it because if you have 15, 20 guys out working, you are not going to want to be confident in them clicking complete as to whether or not someone's card gets charged. Like you get into actually some legal hot water if you start doing that. Because let's say, for example, they skip a job because it's too wet, they accidentally click complete. Well, now someone's card has just been charged, so it could literally lead into a headache of every day being three or four miscalculated charges. And a customer won't really complain if you skip their service because you think it was too wet and then they like no, I still need to come. These won't cancel service. They will cancel service if you charge their card and didn't mow their lawn. So things like that. I would. Again, a lot of these things make sense when you're solo because you have eyes on everything. But as soon as that, you lose that control of being able to see every single job completing every single There can definitely be a lot of hiccups. And so it's definitely something we have on our roadmap with Super. But I personally would not institute that. I'd still have some sort of way for the manager to check it off at the end of the day or something if it's going to charge them like that. But it's on our list.

Next question. Can you share your thoughts on March 2022? ADP employee? Oh mercy. Yeah, small businesses, less than 20 employees. Yeah, I got 37. Yeah, it's, I saw it. I'll probably make a video about it. It's pretty abysmal. Yeah, the, the, the headline is, is you know how many hundreds of thousands of jobs are added and literally 5% of them were small businesses and the rest of them went to large cap companies. So yeah, I'm doing a little research on it overall, just the employment rate and what's happened since the, since the pandemic in terms of where the hires are actually coming from. But yeah, small businesses were obliterated throughout the pandemic, like obliterated. And I just don't know if we can come back. Honestly, when I say we, I mean just like small business owners in general, it's very hard to compete. Like for example, if you're doing development and software, Apple's giving away $200,000 to their top developers. Like that's kind of hard to compete with as a small business owner when you're trying to be scrappy. And so guess where all the best developers are going to go. So it just unfortunately becomes a self fulfilling prophecy and a perpetual cycle that just makes them bigger and bigger and bigger because they have the money, then they attract all the talent, they get all the work and then the small business owner cannot do that. And so yeah, it's interesting.

Another question here. Since growth sucks cash, should I reduce growth to cut back debt for the possible recession? I would only do this if you had variable rate interest, for example, on a credit card because your credit card will probably go from 12% to 22% over the next 12 months. And so definitely I would do it for variable interest rates or interest rates that were like 10, 12, 15%. Like credit card debt, definitely trying to get rid of that because it is variable and it's going to go up dramatically.

So yeah, if you look at your credit card statement like two months ago, it was probably like depending on your credit between 9 and 12%. If your credit was pretty good, that's going to go up to 20%. If your credit was not that great, it's probably 15 to 18% it's going to go up to 28 to 30% over the next year. So definitely credit card debt I would Be hitting.

Oops, I just messed myself up. Like, make sure.

I want to make sure. My camera, my audio. There you go. All right, Move this and hop into here.

Okay. I can't see your names if you're using Facebook unless I bounce back to the group, which I can do if needs be. But sometimes it does help me just have context. So YouTube is the best. If you can hop into YouTube, it does help me just to see people's names. Hey, Mike. In terms of the coming recession. I know. Okay, we already did this one.

What's your position? What's your position using times heading into recession? You say hoard cash, but how can we grow our business if we are hoarding cash? Hopefully. You get what I'm saying. Yes. So keep in mind when I say that when a recession comes and it's, in my opinion, gonna happen in one or two years. Right. That's a long ways away. What I'd be trying to focus on is how do I scale my business now to the point where it's sizable enough to where when I need to actually, quote, unquote, contract and become more profitable, I can do that, and it'd be a meaningful amount. So I would still be in growth mode right now. Honestly, what's nice about marketing is it's a faucet. You can turn it on and off. So if tomorrow we went into recession, for whatever reason, like Russia starts going nuclear or something crazy like that, you just turn off the faucet of growth, potentially in that case. And that's why we have these dailies, so we can kind of stay abreast of these things. I don't think it's going to happen, by the way. But I'm just saying if it happened tomorrow, that's when you could turn the faucet off. So what's nice about this is it's. It's quick to do. It's not like. It's not like all of a sudden you need to turn on growth or turn off growth, and it takes a year to do it. You can do it relatively immediately within a week or two. Should any price adjustments or employee wage adjustments be made to be ready for the coming recession? Not really. Because right now, what's really, really interesting, this is why there's a massive question mark over recession, and that is that the unemployment rate is so low. And that's. That's uncommon. Going into a recession, typically your unemployment rate is going to be higher, and that. Or it gets triggered to that pretty quickly. I don't see that being the issue because labor, labor is so far behind as well as supply chains are so far behind. Supply chains are six months behind right now. So what that means is even if there was a downturn, quote unquote, in the economy and slowed down the job job growth, you'd still have plenty of jobs to suck that extra labor out because of manufacturing jobs being way behind and transportation being way behind and everything to do with the supply chain. So that's why I don't think it's happening next six to 12, like six months. It's not happening because there's just such a massive demand for labor and materials and supply chain right now. It's when those things are gone and we still are stuck with inflation, that's when it could become a real problem. If we're rising, interest rates are going up at the same time.

Had my fourth employee start today. I'm not feeling stoked about him like other employees. He seems very unemotional and I have a weird feeling about him. If he just started today, I just cut him, right? It really comes down to how badly you need someone at this point. It sounds like if you started today, you probably don't need him. Like, like where jobs are going to fall through the cracks. But that being said.

It'S also very possible that you've had a hard time trying to find anybody and this person is kind of needed just to get the jobs done. And so in that case, I understand the pressure, like, man, I got to keep this person. But you just realized that the best way to accommodate this or to protect yourself from having this bad employee that you potentially feel is that way is to have a other people applying and other people that are.

Ready to go. And so always hiring is an important thing. And so I would potentially recommend if you're in a bind where you can't get the jobs done without this person is keep them with you so they're managed really, really well and to at least they get some work done. Like they're just basically hands, like, okay, they're not going to be emotional about the work. They're not going to think with their head potentially. But if you can manage them, fine. But then in the meantime be trying to find somebody else. Until you do find that person, you just stick with this person with you so that at least they're efficient and they don't wreck stuff. That's what I would say.

What do you do when you can sell the conviction but the employees can't live up to what you're selling?

That's when that's when you have to have you really. Then like I said, you guys sell yourself, then you gotta sell your employees honestly, you guys sell them on.

On doing a good, a better job doing and abiding by those standards. And then you can't make someone care, right? So if we go back to this discussion here, you can't make someone care and some people just won't. Hopefully you can make them care using P4P because they ultimately the customer needs to be happy when they leave. So honestly, instead of trying to find people that care or quote unquote emotional about the work, I think it's better just use compensation as the metric and the means to get what you need done. And as a customer that's happy. And so one out of 10 employees will actually have real conviction in doing a great job in making the customer happy with or without compensation. But most people, and rightfully so, come to work for compensation. So tie their compensation to the result of the customer being happy and delivering on those things that you sold the customer in terms of when you had high conviction. So. But it's very rare that an employee in the front line feel the work is going to have as much conviction as you. That's why you have to set up their compensation package to incentivize conviction and doing a good job. So that's why P4P is so important, because it compensates those things.

Hey, Mike. Dustin Bloomington. I would really like to grow, specifically in our recurring mowing customers, at what point in the season would you suggest spending that money? We have not started mowing season yet. Likely we will start mowing Monday the 11th. Yes, right now, Dustin is you're going into the period when I would typically say you want to start focusing on marketing for mowing services. And as a week to two weeks before mowing season starts, I would go off slower now because the first two weeks of growth is when you're going to get the early adopters.

Of the mowing season. These are people like, oh, the grassroots, let's go get someone. Spring is in the air, the buds are out, let's go hire someone. But then you're also going to have the laggards that only start thinking about the mowing of the grass when it's already overgrown. And so that's going to happen for you probably end of April, beginning of May. And that's when you start really getting a lot of overgrown. Like for example, in our local market. I know that in the next two weeks, almost every single lawn that we get is going to be overgrown for the first cut because it's everyone that literally has not mowed it for the past five weeks and has just kind of let it go. And now it's shaggy. By the time we get there, it's going to be 8 inches tall. So I would definitely be thinking in terms of that is like you got early adopters that gonna do the week or two prior to grass growing. Then you have the people who, you know, spring is in the air type people. That's the first two weeks. And then you have the, usually the two, three, four weeks after that, which is the laggards that only end up doing anything once the grass has already grown substantially.

Okay, who is this? Let me just jump in and see who this is making this call. Okay. This is forced. Got it. Yeah. So at the end of the day. Yeah. You say try deducting P4P didn't work. I've tried that. Don't work. Customers don't even complain. They just cancel services. Yeah. So ultimately this is a communication breakdown with the employees. And, and for you specifically, for growing as fast as you have. You know, you're over a hundred thousand revenue very, very, very quickly. And that's great in terms of growth. But that number of employees, you're hiring them so quickly and they have not been established inside the culture. That's really what it comes down to. And so, and secondarily, I don't even think that they understand P4P. They gotta understand P4P. They gotta see the impact of what happens on a daily basis. And I only can say this because Forrest and I have communication and so and I know what's going on. So you know, when you go back to a customer's property and you're fixing it at 11 o' clock at night, if that does not affect their paycheck, they're not going to care. And if they're hitting base pay, they're not going to care. And if they don't understand how P4P works and just a nebulous number and they don't understand the percentages, they're not going to care. This is why, you know, I'm a big believer in keeping P4P simple in terms of the percentage and not having variable percentages and different base pays and a whole bunch of random manual adjustments that you just like randomly do. Because if they don't understand, it will not move the needle. But I can guarantee you, forest, that if 300 just appeared off their performance dollars on their paycheck based upon their poor performance and them not caring and them doing a haphazard job, they would absolutely start to adjust their behavior. But they either a don't understand P4P, they don't understand how it's working, and you got to explain it better. Two, which I think is the more likely scenario is they're not hitting above base pay and so they could care less. And then three is over time, the culture has to be in a place where as you're growing so fast that it's able to absorb these new employees and get them up to the culture of like, the standards that you expect. And if they can't communicate with the customer because of a language barrier or they're unprofessional, that is going to absolutely affect the the customer's experience. And they're not going to be happy and they're not going to to communicate. They're just going to cancel because they feel like they can't even talk to the guys out in the field. They can't talk to the crew out there. So those are all the things I'd be thinking about. And I know you've grown very, very quickly and that's fantastic. But you're taking the brunt of all of that because your guys are not thinking like a P4P person would. They're thinking in terms of how do I just get him here work, punch the clock and get out of here. And they're doing all sorts of haphazard things because there's not enough performance dollars to incentivize them to do a good job. If there's 5, $600 on a paycheck, that's performance dollars above base pay, they will absolutely.

Do a better job. And think about it. When there's that money on the table and they understand that their daily work and their care for the job is the determining factor as to whether or not they keep that performance dollars. So I sent my wife out to babysit the other day. She couldn't believe the job the employee was performing. Yeah. So, like, at the end of the day, this is why P4P exists. So you don't have to do this either. A, this could be a training thing. This could be brand new. I know you have a lot of new employees and you pick them up very, very quickly. That's probably part of the issue. And you're doing hard, larger projects and things, which adds more variability. But however, all of that to say P4P is the system that manages unmanaged labor. So as long as you have one employee, this is what Was a great question by, I think, Cameron on the Facebook group this morning. As long as you have one employee, you don't need P4P because you're constantly managing them. You always have eyes on them. You know where they're at, you know what they're doing. They're constantly reporting to you. You don't need P4P. You need P4P. The moment you have unmanaged labor where you can't watch what they're doing, there are multiple trucks. You can't see where they're going throughout the day.

But you know, babysitting, this is in. This, is this quote, unquote, Babysitting in most companies is called quality control. Absolute waste of money. Overhead is not required. Usually highest paid, salaried individuals doing quote, unquote, quality control, a fancy word in your. What you're talking about forced babysitting is not required. And you can pay your employees more and they can get higher performance dollars if you just allow them to die on their own sword if they do a poor job. And that is there's performance dollars to be taken when they do a poor job. So.

Yeah, so in this case, this is a matter then of likely training. And there's caring. Right. They do. They will not care for little things like weeding is another one that employees will drop the ball on. Edging, trimming, like those small little details they will not care about if there's no consequence to them on their paycheck. And they don't understand the consequence. Right. So if they're just hitting base pay or you're paying them hourly. I know, I know, like you're doing P4P force, but like, I feel like most of them are probably hitting base pay because if there's 5, $600 per paycheck above base pay and they go back to weeding a job, they have to go back, trim a spot they forgot. And they understand that by doing that, they're leaving money on the table. That's when they start changing behavior. That's when they take the extra 10 seconds at the end of the job is to walk around the property and make sure everything was finished. Whereas right now, if you're doing P4P but they don't understand it, they're not getting above base pay. Yeah, they're gonna go as fast as possible or. Or worse yet, they're gonna be sleeping around the trucks or whatever it might be. So P4P is required, but more importantly, it does not move the needle if they don't understand it and if they if they're not getting above base pay. So it's very much of chicken, chicken, egg. Because, like, man, if they just worked harder, they would make above base pay and I'd have performance dollars. So I know that's a tough move. And the reason that's usually happened is because you've added so many people that they're not efficient enough, they're not trained up enough to even get above base pay. Like, literally, if they just got all above base pay for a few paychecks, they changed the culture. And so this is why even at the local shop, we have less employees than we did last year. But I'm okay with it because now the culture is super solid. And so now they're like, okay, now we'll go hire people. Now we'll go add to the team because everyone here is solid making above base pay. Understand the culture. We haven't had like a people leaving and stuff like that at the local shop in Bellingham.

This. Yeah, again, this is kind of chicken, chicken the egg thing, right? Like, ultimately, if they worked harder for us, they would make more P4P. The question is, how do you get them to just take. Get that taste of performance dollars? And this is might be what you need to do. And that is take a few projects, overbid the jobs, make sure that they on that paycheck they make. Let's just say if you're. If their base is 18, they make 25. And all of a sudden they're like freaking out, like, whoa, this is great. That's when you have a meeting and you explain the numbers and they'll actually start to care about P4P. And then you start to show them when they're on their high and they've made really good P4P. You show them what the downsides of missing the edging, missing the weed whacking. That's when you show them. You do not show them. When they all hit face pay and you got. You're screaming at them being like, oh, man. Like, if you guys just worked harder and did a better job, you could make way more money. Don't do that. Wait for them to get a really good paycheck and then tell them, hey, to do this. Here's what you did. You beat this job. Here's the math behind that. And furthermore, in order to make sure you do that, get that in the future. Don't do these other things like missing weeding, missing pulling weeds, edging, etc. Service autopilot is so laggy on my phone or Kicks me out before I finish notes and then don't save the comment. I often wait until the end of the day and do on my computer or bringing that with me. Is it just my personal issue with essay or common issue? I would definitely say in terms of your phone, try the triple tap on the top. So this is one way to clear service autopilot out. Let me see if I can't quickly log in my password. But when you're logging the service autopilot, just assuming you logged in when you're in there at the top, triple tap that logo once you've logged in and then click clean and wipe and clean I think it is. And it'll reset all of the data inside the app because it actually stores a lot of your customer data on the app. It's not just cloud so that sometimes helps. But yeah, it's like this morning for example, the first three to four days of every month is so slow at command center I see like those pinwheels turning all the time. It's yourself. So again it's because it's a very very complex great system. Honestly I like servers output like the system itself is great but because so complex it's very slow and clunky. Super is lighter. It doesn't have all the feature but it's fast and everything's in the cloud versus being so much on the device. But not a bad idea by the way though to have a Chromebook when you're out in the field. If you're doing a lot of estimates and things, you need a Chromebook like 200 bucks. Get a cheap one that are pretty hardy and type it out a little faster. Copy and paste your templates and things.

Yeah, this is a great point. Whoever wrote this definitely get in this habit. Don't type your notes up your your estimate notes inside of service auto. Put type them in a your notes app and then copy and paste them in. Definitely recommend this like big like you'll do like a massive, massive line item estimate. That's very custom and then it'll just not save. So yeah, I would definitely recommend this.

Do you have a recommendation on percentage of recurring moments compared to projects, cleanups, installs? Yeah. So there's that number on your coaching call that you have with Lee that we track and that is the percentage of revenue that is recurring work. And so when you're first getting started that's going to be higher and when you're growing really fast, that number is also going to sorry to be lower because your project the percentage of Your work that comes from projects is going to be higher when you're first getting started and when you're in hyper growth. The reason for that is because tomorrow I guess go sell two. Like if I'm just getting started, I could go sell two $5,000 jobs, have $10,000 of revenue on the books for this month, I'm just getting started. But if I go get 10 mowing customers, 10 mowing customers tomorrow, that literally might lead to $1,1500 in revenue this month, which would be like 10 to 15% of my revenue. But I got 10 of those jobs versus two of the projects. So that's why project revenue will typically make the vast majority of revenue at the beginning of your business growth. And then as time goes on, the company matures and you're not growing as much in terms of year over year growth, the percentage of your revenue coming from recurring work should increase. And that will make it more system oriented business. It'll usually mean you're simplifying services a lot more.

And so I. Yeah, like, or you've just been diligent to restrict growth and not take on projects, right? So I know there's several locations that there's no projects whatsoever, just mowing. And that's fine. They're just going to grow slower. Because recurring work is a trickle, right? You get a couple a week, you get a couple more a week. And over time you build that repertoire of hundreds of customers that takes a long time versus in a matter of six months with advertising for projects, you could immediately have hundreds of thousands of like, you know, force is great at projects down in California. And that's why he grew so quickly. His percentage of recurring work is much lower of his revenue. And that's what that usually creates chaos that you're hiring a lot more, you have bigger projects, installs all of the one time jobs. So at the beginning though it's gonna be a higher percentage. But if you constantly are putting your money in terms of marketing back into recurring work, that trickle of recurring work should be growing steadily as time goes on.

And then that's the ultimate goal is to have like I know Smyrna, Georgia for example, they have 99.8% of revenue comes from mowing. And that's just over time, just weeding out customers. It's a very, very small one mile race that he's in. Very profitable, he does it on the side. One employee like that is the ultimate goal. That because it's much more systems oriented, because it's recurring, versus always getting the next project. So in terms of my recommendation, I would say I could definitely, probably get a number for you, but I would say it's the higher your growth rate is, the higher your percentage of projects will be. So as you slow down growth and you become more profitable, it's also usually correlating with a higher percentage of your work being recurring. So, you know, if you're just getting started, it's not uncommon to have only 15, 20, 30% of your revenue coming from recurring work. As you mature and you become much more profitable, usually in years three to five, that's when you're typically going to see a 60, 70, 80% of revenue being recurring work. And then all the gravy is just, you know, projects that those existing customers bring your way because you're not marketing for it. So cool. Thanks so much everyone. Have a great rest of your day. As always, if you have a question throughout the day, use that link in the description of the YouTube video and that will allow you to submit onto the Google form. And I'll have a couple more updates later this week when we have the roundup on Thursday. But for those of you who served as autopilot last night, I did post an email to you about the updated form for getting reviews to simplify that not making a two step process. Now it's a one step process. It'll take you about 15, 20 minutes to set that up. I did the video walking you through that. If you have any questions, bring those to me tomorrow morning. We can go over those. Take care.