Mike Minutes Mastermind 05/08/2024

Hello, Augusta Nation. Hope you all are doing amazing. Happy Wednesday. Let's get this party started. Looks like we got seven questions that came in. Very good. Let's jump right into them. Oh, I gotta put this in the Facebook Group now. Sorry, one second. Copy.

Facebook group. Boom.

3M O5 084 Boom. All right.

Post. All right, we're live.

First question up is from.

Vel.

Right here. One second. There you go. Bill Thomas, Nocatee Is there a way or will it be a way to do a bulk price increases either by percentage, hourly rate or per dollar amount? Yes, there is a bulk price increase option inside of Copilot already.

There's a. There's a ticket probably next year that we'll get to. They'll add a lot more functionality around this to drill in way deeper. But you can already do bulk price increases. It's just limited by percentage and hourly. And the rate, it's not like you can just be like, I want to change my hourly rate from $70 per hour to $80 per hour. And then it just changes everything. Don't have that optionality yet. Also, there's no great way to pull that into an email right now unless you're doing custom fields and you can use the merge tags. That would work. But it is functionality is there. I'm a big fan when you're doing price increases to still send email by email. Even if you have the ability to do it in a more bulk fashion. It'll take you an extra hour. You're making so much money in terms of price increases. I'm a big fan of just still doing it one by one. But there is a way to do pricing bulk price increases. Feel free to look it up in Copilot University. A lot more functionality though will come next year. There's several things I wanted to make it significantly better.

Bill Thomas, to clarify on labor rate, I don't pay the guys 49 and 19. I pay them 30. But in the growing season with level billing, it cost me 49 in the growing season because I'm basically the bank for the customer until the off season.

Got it. Okay. But in the growing season with leveling cost me 49. Okay, that makes sense. That makes sense. Got it. All right.

That was from yesterday's question. Eric from Largo, Florida. What what would your locations visit notes typically include? I usually include cut heights, any areas that require push mowing, sometimes hazards or low spot to watch out for, and sometimes the designated side of the house. The mower can be can access the yard, the backyard with having new guys going to properties at their time, I'm tempted to add more detail to save time but don't want to write a book for each property that gets discarded anyways. So I'm trying to find a good balance. Plus at some point some critical thinking assessing is needed especially if they're the first person to serve as a property. Yeah, like I always say, look, we go to a property, you're going to edge, mow and blow at this height and you're going to beg clippings unless you see otherwise. And then that's for my locations. And then it's a matter of that's your standard verbiage. And then it's just really any sort of people the customer calling and say hey, they missed this backyard portion that's probably going to end up going in the notes. I don't want them going the left side of the gate. I want to do on the right side that becomes notes. So usually I wanted to have as standard as possible and then let the customer try to dictate the changes instead of me being all like getting in the nitty gritty diddy nitty gritty details when the crew is just going to figure it out regardless. And no need to put includes backyard. They know to mow the front and backyard unless I tell them otherwise. Right. So I'd make like in training with your crew, just make, hey, these are the assumptions you're going to have. Mow every single blade of grass on this property unless told otherwise. Mow it at this height unless told otherwise. Bag it or don't bag it unless told otherwise. You don't need to see edging for us to know that we're going to edge the lawn. You're gonna use the stick edger or the weed whack or whatever you do. Like these are the assumptions. You'll be told otherwise in the notes. Otherwise you can literally write a book on your job notes. Tim, quick scenario. Employees scratch side of vehicle with bamboo. We had to pay $600 plus tax to get it repaired. I spoke with the employee and said we would deduct some of his PVP over the next two pay periods. As the one who one he wasn't. As the current one, he wasn't getting PVP because he had ot. He agreed and said he would work on being more aware of surroundings. This is a good, very good, very good accountability moment and employee owned mistake. Then I found out that we are only supposed to deduct any people fee for a pay period. It happened to me this logic defeats the purpose of accountability and making employees have repercussions for rush work. Scenes of business shouldn't have to take this much risk on if we are giving ability to make 600, 900 or so on PPP, shouldn't they have to cover the cost of a repair over two or three pay periods? Just would like to know your thoughts for context. The employee I have is 54, so maybe he is more mature and understanding the cost mistakes. That last line is the kicker. Most people are not going to be that way. You will simply lose someone. If you're okay for the next three pay periods, I. E. Six weeks, we are going to remove the ability. If you make more money on paper performance and you are used to making extra 5, 600 a paycheck. Yeah, that's going to be gone for the next few pay periods. Do I think they're going to be a great cultural motivator for the rest of the team? Are they going to work hard? They're going to push each other work extra for the their team members? I don't think so. Now if they're 54 and they see the the mistake they made and they take massive amounts of accountability and they're super mature. Awesome, Fantastic. And if you had this discussion, I'd still do it.

But generally I just want to hit them one time with the paper with, with the issue. And I typically do it on the time when I get charged because if you paid the $600, it might be on the next pay period. They actually pay for it. And then I would be, hey, here's the receipt, here's the deduction.

But if you've had the conversation and like they agreed to like have it come out of the next paycheck. Cool, awesome. Great. I would expect that the next paycheck is not going to be super great on P4P because they know whatever's in there is going to come out. So.

Most the time. That's why I recommend I don't even tell them the amount until the end of the pay period because they're working hard. They're doing P4P at the end of the pay period. Okay. Your P4P would have been 900. We took 600 out. Here's 300. Okay, it's done. It's behind us. Let's go. I don't want it hanging over their head like, hey, next paycheck you're not gonna be able to make any PvP or 600 is coming off. Is likely that that person went from 900 in P4P bonus down to 300 because they simply put less effort in and now all of a sudden that that subtraction didn't do anything for me because they simply worked less hard.

Nick from Marysville I'm so excited about tracking conversions now on Google. It gives me way more confidence to spend on campaigns. In the past it was just some random spending and never knowing where the leads are actually coming from or which ads were converting at which rate. I'm curious when you say under $100 customer acquisition cost for simple services, it's a green light to spend and I know this is in relation to lifetime value, but I have always wondered how you came to that conclusion. Like what makes $100 different $100 the general cutoff for CAC? Also, what would you consider a bargain CAC? Is there a certain CAC where you spend on marketing and remain profitable? Asking because in years past I've always just switched gears into summer because I didn't know what the cutoff was for spending on marketing but still remaining profitable, I would opt to cut marketing and go back into profit mode. But I'm thinking if I have a good CAC and I know I can remain profitable flat, I will keep spending on marketing and filling as much labor and asset capacity as I can even during the slower months. I am thinking if I know the target cac, I would I want to spend as much as I can to stay busy as long as possible as I am profitable. Hope it makes sense. One more is your rule of thumb 10 to 15 of annual value spent on marketing. Does that change at different revenue markers? Thank you for investing in testing these campaigns and setting up track conversion tracking. Yeah, you could probably say something along the lines of like 10% of annual value. That'd be like one way to say it. The reason I say $100. Anything below that I'm willing to throw money at it is because I know generally I'm gonna make about $2,000 per year per customer. So if I can spend a hundred dollars and I am 20% profitable on that $2,000 of revenue, it means that I turned a hundred dollars into $400 I. E. My profit in one year. Pretty good stuff. I like that return. If I have to start spending two or three hundred dollars all of a sudden now, it might literally take me the majority of the year to actually recover the cost of acquisition. And with with general churn, people moving, people selling the house and people leaving due to quality.

It is hard. You're hard pressed to know that Every single customer you're going to be able to retain for the entire year before you can actually recoup the cost of acquisition. So as a general rule of thumb, I use a hundred dollars as a very basic rule of thumb, knowing that for the vast majority of us, we make between, I would say the vast majority, between 1200 and $2000 per year per customer. And if I'm going to be 20% profitable on that, I want to have it, I want to get that money back within a matter of a few months. I do not want to make it where it takes me. You know, there's not revenue. Like you can't just make $100 in revenue. Like, oh, that's just two mowings. No two mowings of revenue. But if you're 20% profitable, that means 10 mowings before you're actually profitable on that $100 customer acquisition cost. 10 mowings is two and a half months. So really three months before I see that money back. Which means if you start, say you're billing on even a weekly or monthly basis, it could be three months before you have their cash flow come back to you from acquisition to actually being profitable. And if you lose them in that three months, you've lost them like you're actually losing money on that customer. So if you start getting above $100, typically is when I'm like, hey, this might be too much for us. Now, if you're doing projects, 10% of I shoot for 5%. You'll see in the book 5% of one time jobs is what I'm willing to spend on acquisition, typically. So if it's a, if it's a $20,000 job, I'm willing to spend $1,000 customer acquisition cost. But I know I got that 20 grand coming to me right away. So in general, the general rule of thumb, and you'll see it in the book, is on recurring jobs, I want to recoup the cost of acquisition within three months. So again, if you're charging way more for mowing, you're charging way for more for your services, you can pay more for your customer acquisition cost. Also, 5% of project spend revenue is what I want to be spending on one time jobs. So if I'm doing paper patios and they're averaging 20, $30,000 a piece, I'm willing to spend, you know, $1,500 to get that customer. But I want to be under 5% because if you're running a 15 to 20 profit margin, I still want to have at least a 3 to 4x on my marketing dollars on a one time job.

So good rule of thumb I would say is like 10. Anything below that is decent.

I. I'd be shooting for 5% ideally.

But under 10, I'd probably give the nod.

Bell Thomas from Nocatee, Florida. After speaking with coach Brian Connor, we had the following question. Given my current situation with my bicep and being at 75.5 budget hours and need more revenue, would you recommend one of the following action plans? One, Send one click estimate to the rest of my database for mulch. I already sent one to just my mowing clients. Okay. Two, get to budget hours. 90 budget hours to hire a third team member. Three, high reps and consistency with door hangers. Four, raise prices or. Oh, I see. I was like do all of those. Okay. Or do one to three drive forward and fill the asset capacity. Four team members at 120 budget hours per week, then raise prices. By the way, I had a team member finish the. Okay, one second. Okay, let me finish. By the way, I had a team member finish the day yesterday throwing up and still throwing up this morning. He called out sick early this morning. So I'm gonna suck it up to see how well the doct did on my bicep and see if I can bust out the missing team members route. Today I'm in a hinged brace that gives me more movement, so I should be good to go. Oh, mercy. Okay, well be careful. And secondly, we would love to see a picture of this on the Facebook group. What a. What a guy. Let's go. You're. You're my hero, dude. Okay, so a couple things. I would say.

This comes down to how much cash you have available. I know yesterday you said because now you're out of the field, it's been chipping what your private. Your personal reserves. I would probably say go ahead and raise prices, especially given the fact that you're out mowing right now. Raise prices and then do one through three. I would actually do like number four immediately. Okay, you would probably. If you raise prices on.

The 75 budget hours you currently have, that would mean you probably. Let's say you add $10 per budgeted hour. That means you're going to add an additional $3,000 per month in profit just by adding it. By adding $10 per budgeted hour. Right. That's probably five or six dollars per cut. Trust me, like you will be able to do that. You will not lose a single customer. I'd actually go more. I'd go more like the 15% like Brian was saying. So you're going to add 3 to $4,000 in straight profit by doing that. Then you're going to have the confidence to go 1, 2 and 3 and hire the third team member. Because now that's you're literally going to pay for your team members waged by raising the price. You will not be doing the work now. You'll be going and doing exactly just said and that is Getting this to 120 budget hours per week as quickly as possible. So I would just flip this a little bit. I'd raise prices to give yourself the cushion and confidence to go get the third team member and by having the third team member to a fire under your butt to go do number one and number three and fill the schedule. And I would do definitely the one click estimate email for mulch to immediately be able to fill the schedule for the third team member. Because if you did that correctly, you could book their first two weeks out completely knowing that then in those two weeks while they're doing the mulch job, you're gonna be doing tons of door hands trying to get mowing jobs so that you can add an extra 10, 15, 20 budget hours of mowing in those few weeks that you book out with the mulch. What a guy. Let's go. Love you, dude.

Just plano Audi. Oh man, the nicknames are getting out of control. All right, coming up on three weeks ago now, Nick Reed if announced he was officially taking over Lee spot. He's not taking over the spot, he's just taking over the owner success manager role. I can say I'm proud of both of them for stepping up and continue to develop and change. Question Nick Reed going to also create a YouTube channel and get distracted. No, really. I know you've talked about this before, but here's the headline of an article. Jobs are no longer hiring. I know you've talked about this, but if you will again, the good and the bad. Thank you. Jobs are no longer hiring. I don't know exactly what you're mentioning there. It could be that people like what you might be referencing here is like shadow jobs where people are putting up tons of applications.

Of open positions on things like Indeed. And they're not actually hiring anybody. This is very common especially for publicly traded companies or private equity backed companies because it makes them look like they're trying to grow and expand and get more people when reality they have no ambition whatsoever of actually hiring people. And this is why you hear tons of people saying Right now that they're doing 20, 30 applications and no one's hiring them because a lot of these companies, they, they simply just keep hiring or they keep interviewing, they keep putting applications, accepting applications, and they don't actually hire anybody. Even though right now the market is down and they're not hiring anyways. They're actually laying people off. But then they have. That's why people are confused. Like, why are you laying people off? And you have hundreds of open positions on your website and you're accepting applications and who. HR department taking interviews. So.

Just remember that when you're public or you, you're backed by funding, you have different metrics by which you are being measured by. I can kind of skew a lot of these results for us smaller business owners that need profit. Gus Longcare Fenton. Will there be an integration copilot for simple estimates or deep learn down the road? We're actually almost finished our API which would allow companies like this if they wanted to build something out to connect Copilot. Um.

So maybe if they wanted to build something out, it'd be sooner than later, but otherwise it'd be very much down the road if we have to get involved in our engineering team. There's been too much of a drop off. When I tested people that actually have to measure their property and like draw lines and do like. There's such a massive drop off. It's incredible. They're not even accepting the estimate. Just them to start drawing on the paper like, and actually like do the work that you need them to do. The AI scans are good, but they take too long, like even if even five seconds. So it'll all improve, it'll all get better. I'm open to those sort of things down the road, but as it currently stands, I can't, I can't. We can't afford to have a 30 to 40% drop off before someone even submits their information.

And it slows the site down dramatically when we put the plugin in, which hurts our SEO. So now it's like 30 to 40% of you get to your site. Less people get to your site because now your site's, you know, taking two times longer to load because these are heavy plugins that are pulling tons of data when it comes to the AI scans. So the tech will get there. But I'm not in a rush because I've just seen way too much of a drop off when people get there and the amount of penalization from Google by making your site too dense. So. But if they want to connect to us down the road with the open API. Sweet.

But we are. We are not planning for that. Definitely not in 2024. All right, everyone, I hope you have a fantastic Wednesday. We'll see you tomorrow Thursday. Vel love to get a picture of you if you're pushing through today. Best of luck and stay safe.