Mike Minutes Mastermind 05/15/2023

Hey, everyone. Hope you're doing well. Happy Monday. Hope you had a great weekend. Let's go and hop in. Just make sure this is on Facebook.

Second.

All right, cool. For those that are interested in going to the Southeast east.

Workshop in Memphis, make sure you sign up. It's coming up in just a few more weeks. I think it's next month, June 23rd, I want to say. So definitely check it out. It is on the dashboard. There is a header for it. Make sure you sign up there.

That is put on by Kevin Fairburn and some of the other franchisees out towards Memphis. So thank you to them. I will not be there, but I know Lee, Chuck, Liz, they'll all be there. The reason I won't be there is because I will be feverishly trying to get my location up to 300,000 in revenue as soon as possible. So I can't afford to miss three or four days, unfortunately. So I will be there in spirit, but I only Chuck and Liz will be there. All right, let's go and jump into questions.

Boom, boom.

First question comes from Eric and Largo. When you have an employee do five around door hangers while on the mowing route, should they be given a manual adjustment for the time spent? My time, my perspective on this one is not if they are just doing five arounds and you're requiring it for like all mowing jobs, it literally takes a couple minutes. I would say to if they get a customer that they put the door hanger on, they would get the $50. So I would rather you pitch this as more to them. Like, hey, take an extra couple minutes. Do that, you know, 20 times a day. Yeah, it takes you 30 or 40 minutes. But if you get one customer, that's 50 bucks. So that's what I would recommend doing. And you can pretty easily find out who did that door hanger simply by if they're a neighbor of your existing customer, you can just go to whoever was at that visit last and see was on it. So it's pretty simple. Even if you're not doing where they're actually riding on the door hanger or putting like their, their business card or stuff like that, you can usually find out pretty quick. So I would, I would prefer to do that so I'm not having to do a manual adjustment every single day when they're doing the door hangers. Now obviously if they're doing like hours on end, I would make probably make a manual adjustment where they're just doing door hangers.

Westward. And how is Evergreen Mo ever grow marketing working for you in in. I'm curious how I match up and what your thoughts are so far. Yeah, we've been doing it for like six weeks. I think now I will probably have a better report by end of June. I want like three months to really really compare it.

And so I'll be able to see like what's the value of it. Right now my kind of traditional thought is if you're spending more than 15, 12, 1500 dollars a month on Google, probably a good idea to have them to manage it every single day and have 40 different campaigns running and tracking every single word. If you're doing you know, a couple hundred bucks a month on Google, probably not the best use of your money to spend, you know, five, six hundred dollars a month on them. Managing it Thomas from Littleton Trying to one click market our client database for mowing services in service autopilot. However, I can't figure out how to exclude current paused clients from the list. The closest filter I can get is service pending scheduled not equal to the problem is that it's excluding the pause clients as well. I would love to market to them but can't seem to get around the barrier. Please show how to explain how to do this. So I would probably if I was you just use the one that is.

Service date. So I'd filter out by service date. So if I'm trying to only do the customers that are not paused I I would be filtering out okay the last three weeks if I've done mowing for this person, let's send it to them. That way I kind of know it that they're my active list and then.

The problem is that it's excluded. So yeah service pending scheduled.

The problem is excluding the pause mowing clients as well. Yeah so just do a service date do a date range. You can do another filter for date range to do the pending schedules but then do by date as well. Whether you do date in the past or you want to do like okay, anything six months back or you want to do like the past three weeks for example is usually most your most active recurring customers are. I usually do at least 3 weeks just in case someone is on bi weekly, etc.

Kyle Tarvin, you talk about not letting the loud voices get to you. It's easier said than done when customers are upset, employees are going crazy, et cetera. How are you putting that into practice? Any tips?

Honestly, it just comes like in time. You just see you have a track. You create a track record for yourself of what actually happens when you get really worried and concerned about something, and that is typically the next day you wake up and the world's a brighter place. And in a week you hardly remember it, and in a month you don't remember it in a year, it's literally inconsequential. So if you do that enough times, it's. You start hopefully flexing the muscle of being able to have some perspective and realizing that it's not going to cripple you, it's not even going to be a blip on your radar in a matter of a few weeks or months. So I think that's what I rely on. Just the evidence that what historically has happened will probably, statistically probably happen again. And that is, it doesn't really affect me as much as I think it is. And that the vast majority of reactions to any circumstances are overreactions. Because we are humans and we have emotions. The only way to statistically have the correct answer and statistically.

Make the right judgment calls and feel the right way every single time is for algorithms to run us. But we have emotions, we have feelings, we have personal lives, we have relationships. And based upon all those factors, it's going to feel, it's going to affect how you feel about the customer being upset, employees going crazy, etc. So I think just seeing it over and over and over and over and over and over and over and over and over again, and that is throughout your career, is realizing that the things that are causing you, that are the quote, unquote, loud voices literally become not even echoes, not even whispers, but you can, they are literally inaudible in a matter of weeks or months and definitely years. Like, you talk about the biggest things in your life that like, are catastrophic to you right now. In 10 years, you will literally, you'll feel like a completely different person. It will not be a blip on your radar. You'll think back to it. If it's like a divorce or a bankruptcy, like, in 10 years of bankruptcy, that same person can be worth millions of dollars. So, like, seeing that over and over and over again, you have to start creating the storyline. And that is in the moment, hopefully being able to tell yourself this is not as big and bad as it seems. I will get through this. I will not remember this in a few years. And this is inconsequential to the goals that I have. And to me, the only thing that helps is because in the moment, everything seems so much, so much worse. To this day, when I get anxious about where the business are at in Terms of money, how much we're spending, how much we're growing, unhappy franchisees, unhappy customers, unhappy employees, whatever it is.

I simply ask myself, like, okay, like, in 25 years, if I'm ringing the. The bell in the NASDAQ exchange or whatever, like, we're trying to go public, will I remember this day? And the likely answer to that is no. And even if it's something so big and massive to you that would currently. Do you currently think would derail you, you still won't remember it. So the only. The only failure is quitting. So, like, as long as I don't quit, we will get through this. As long as I don't quit, I. I will be able to succeed. That is. That is not even a. In the realm of possibility. That won't happen. And so when you actually believe that.

You start to get better at being able to step out in the moment. But it's still not easy. Like, I still, to this day. And, like, you know, I'll have moments where it's like, man, I don't know if we can keep growing. Like, I'm hiring more developers right now because I need to make sure we can get everyone, all the features done for us in Augusta by end of the year. So, like, yeah, like, it's like, well, where are we gonna get the money from? And. And it's like, am I running it too close? And, like, every single pay period is hundreds of thousands of dollars. Like, is that. Is that. Is that safe for the employees? You're running through all that calculus in your head, and then you have to step back and say, what. What. What Do. What do I regret more over the past 10 years of doing Augusta and my career? Is it that I didn't swing hard enough, or. Or is it that I should have played it more conservatively? It's just very. It's very obvious. Like, if I would have just gone. Done things sooner, faster, and gone bigger, I'd be ahead of where I'm at today. So why not just keep doing that over and over and then create the track record that I personally start to believe in, that is, I should swing for it. I should go for it. And that the inadequacies that I feel, the anxieties that I feel and the shortcomings that I have don't measure up against the goals and what I'm going to achieve, and they'll just become speed bumps in the grand scheme of things. And. AI look, in the. In the moment, you see, it's still like a mountain feels Insurpassable and like you can't do it. But perspective will help. And that only comes in time.

Kyle Tarvin, what are your thoughts on buying a crappy 2-3k truck, painting and slapping on some decals as a backup truck? Love it. I don't know where you're going to get a truck for two or three kids, but even if it's 5 or 6K, I like that idea. This is why people are always like in the comments when I talk about used trucks, they're like. And they say they should buy. You should buy new every three years, whatever. They're like, well downtime cost you so much. Like yeah, downtime does cost me lots. You know I do, I buy a really cheap truck for every like five or six trucks that I have and it sits in the truck in the park in the parking lot for the majority of the day. And when a truck goes down we pull that one out. And so yeah, we're have to pay for repairs but there's not really a lot of downtime because I can afford to buy five trucks the price of your one new truck. And so while you're out getting your one brand new truck all fancied up, I'm going to have three trucks on the road and one truck goes back up just in case one of them goes down or blows something up or has a flat tire, needs brakes realigned or whatever. Yeah, huge fan of that. I would say you need a redundant truck every five trucks you have. If you have five trucks and they're all used, I would definitely recommend having at least one as a backup. At least one. Like literally just to be sitting there all the time. Because it's likely that when you have five trucks or more, you're going to have one truck down at any given time just for like even if it's just like new tires. Well, new tires might be three or four days out by the time you have to like schedule it. It gets in the shop, gets back, gets rebalanced, whatever it is. Right.

Vlad from Winter Garden. Is there any Zapier automations that will be exclusive to Augusta? If so, can you share your ideas? The main exclusivities that kind of fight for with Augusta that I feel actually move the needle. So you can't really do exclusively with Zapier. There's no point because it's like you basically create open source once you have Zapier integration with Copilot and then you have actions and triggers. So I'm not too concerned about that because the vast majority, 99% of people will not use app here. As much as I think it's the best thing ever, people just won't do it. Just they won't. Furthermore, I'm fighting for and when I say fighting for just it's just a matter of now I have a partner and I need to make sure that other stakeholders make sense of it financially. But what I'm really trying to go for with feature exclusivity is.

Stuff around P4P integration stuff, profit sharing, etc. But more importantly, two things. Command center stuff that we, we always wanted and we know we could save massive amounts of time. For example, there's one feature that will not be exclusive to Augusta, but it will save us, every single person here, 25 to 30% on your command center bill because it'll just reduce how much time we have to spend on your account guaranteed at least 20%. I'd say more, more likely 25 to 30% of everyone's command center bill should go down next year simply due to what one feature. But when it comes to feature exclusivity, for example, I want I've already talked about the databasing of pricing inside of the the back end to be able to not need a software like Deep Lawn to measure properties, but rather it's data based that's manually inputted instantly being able to get the price which Deepline currently does once the customer inputs their data and stuff. But you got to pay.

Usually around 40 cents to a dollar per address. Well, what I want to be able to do is be able to get everyone in there for 10 or 15 or 20 cents on a dollar measured already and then we input a database and being able to have that instant data that's already been measured and we upsell them on multiple other things because we've already done the measuring of the property. And then furthermore being able to take that database and then send integrate that with a postcard company to where the customer can open up their mailbox, get a postcard, every door, direct mail, scan a QR code and immediately put their credit card information and that's all tied back into Copilot. That's the part I'm trying to hold on for us. That's the part I think I, I really do believe we can make that exclusive to Augustine as the databasing and then the ability to be able to connect that database with the back end to be able to have it where a customer gets a QR code, scans it, the pricing's already there. It's they're like, yo, Your pricing is $40 weekly and $60 BI weekly. Which one do you want? Tap on it. Build boom. Enter your credit card information, you're on the schedule for next Monday. That's what I want. We already, we will already have that infrastructure built out, but on an individual property by property basis through Deep Lawn.

But if you, if you'd pay a dollar for every single house in your market, you'd be sending 20, $30,000. And my goal is that we can get it for a tenth of that as a database and then use that on every door direct mail because no one else is doing that with every door direct mail. So I'm kind of looking forward to that.

Chelsea Collins from Arnold. Hey, Mike, if a crew has damage that you don't know the final cost on, but the pay period the damage happened is about to be paid, do you do a manual adjustment for what you know, and then when the remaining bill comes in, you add that to next pay period. We had an employee hit a hose bib on a customer's house, which somehow caused issues with their sink. Kitchen sink. Wow. The homeowner didn't have access to their shut off in the basement. So when the plumber came out to the repair, he had to cut out their drywall. 800 for the plumber, but that didn't include the drywall repair which are going to do in house. To save on costs. His employee also damaged a sprinkler head on the same property that day, which was an additional 150 repair. Fun. Fun. We don't know the cost of drywall portion yet since it's not complete. Just wanted to best procedure on how this would work. Thanks. If, if it's gonna be like a few weeks away, I'd probably, you know, take the hit now and then whenever that one comes in, do it separately. But usually I like to hit them just one time and so I'd probably wait in that case. But this really comes down to a lot of different factors. Like if this person has been doing a lot of yellow slips and a lot of callbacks, and then I would probably hit them now for what you can, and then whenever the next one comes in, even if a few pay periods, probably get them again for the drywall, which is kind of a separate repair, but typically to just hit them one time and typically we would just wait for the final bill and we'd hit them on that paycheck. But there's a lot of variables that go into that. That's why I'M not really giving you a definite answer. Like if the employee is way like crushing P4P and has a notorious habit of making yellow slips, that's what I'm going to be more penalizing. Probably do it twice.

Kyle Tarvin I can feel myself at the beginning of burnout from working out in the field six days a week. The business needs me around, but I'm slowly losing my interest in working. Do I need to hire someone to take my place on the crew and step back for a few weeks? I'm just looking at our cash flow and P and L, the business still needs me to cover. So this is when, if you're working six days a week and you're out in the field, you are likely at capacity. This is when you talk to your coach. You know exactly what.

Raise prices. It is to.

If needs be, constrain your estimates. But I feel like the more the burnouts coming from you is because you're working on the field so much and your cash flow is hard. It is way more taxing on your physical body when you're working the same amount but at the same time. You know that there, there's things in the bank, there's not enough money in the bank and that you're financially stressed, the financial stress compounds of physical stress. And so if you at least can solve the financial part by raising your prices dramatically and I mean like okay, let's say you have 100 mowing customers, I'd raise the price on all of them substantially. Even if you raised on 100 million customers by, let's just call it five bucks a mo, I guarantee you'd probably only lose several. But if you did that and you were mowing them on a weekly basis, that'd be $2,000 extra in your pocket every single month. That $2,000, that's 500, that's $5 times 100 times 4. That $2,000 will pay for somebody to at least work part time for you so you can get out of the field. And then by you being out of the field, you're probably better on your estimates. You're probably gonna get back to your estimates faster. You're probably gonna do follow up calls better.

So this is when you, you gotta raise your prices. If you're at this point and if you're like, well I'm sure it's trying to grow okay. Like you have to realize that in the heat of battle it's like well I want to take like five more miles. So I'm just going to keep like plow if all your, if all of your, your soldiers are like literally getting blasted, you're not being like, oh yeah, we're gonna go five more miles. It's like, no, let's like hold the ranks and like, let's go more of a defensive measure and defense for you is raise prices. Let's not focus on growth. Let's switch to profitability mode. That's fine.

In, in two months you could have three really good employees join and you're like, man, I could take on more work. Then you can go back into growth mode. That's fine. There's no like massive lever that has to be switched on growth and profit mode. You can easily switch this pricing and making sure your close ratio is dialed in. So if you're working that much on the field and your P. L seems too skinny for you to fix this, this is when you just be like, okay, I'm going to take, I'm going to put growth on the back burner for a second and I'm going to focus on profitability. Because a few levers pulled, you can fix the profit issue. Like very, very simple. I say simply, it's simple but not easy. And that is you raise your prices on existing customers and you raise your prices on new customers coming in. All right. And if you're struggling, well, I don't have a lot of work. Well, first of all, seems like you have a ton of work. You're working six days a week. But let's assume that you, someone's out there saying, well, I don't have a lot enough work. Okay then great. Raise your prices only on existing customers for that $2,000. And let's not worry about the, the new customers then if that's a big deal for you, right.

You know, raise your E fees. You're like, well I don't, I don't have time to go do estimates. Okay, great. Raise your prices. So it cuts back a little bit on your mowing. Start charging way more e fees. So now when you're out doing estimates and you've hired that part timer, you're now collecting sixty, seventy, a hundred dollars per estimate you sell. You're able to put that money towards, oh now all of a sudden that 2000 became an extra 4, $4,000 a month and that will cover the entire employees wages simply because now you're out doing the field, out of the field and doing estimates in person and closing the deals and charging e fees. Right. So.

Landon Smith, Tallahassee, Florida. I got my every door direct Mail and I'm going to send it out. We have bad weather this week and I know that plays a big role on the return. I plan on sending it out every two weeks starting this week. So I postpone until the weather is good. Then again, weather may be bad the following weeks, even if the first week is good. How do you navigate moving your mailing plan around bad weather? Should I just send this week's out in the rain and hope for better weather the following weeks? Which time first to third shipment Manage the most in terms of weather. This is like literally you ask us to 10 different people who have 10, 10, 10 different answers. It all just based upon their market, their climate, timing of the year, etc. So all I know is that weather matters. I know the timing of your of your market and when the grass is growing matters.

If you know you're having like three weeks solid of bad weather, you should probably send them out because further, like if the grass is growing really fast and people need to mow their grass, if it's bad weather, it's even worse for them to have to do it themselves. There's even more inclination that you needed to be doing it. It is that most of the time people don't think about their grass until the, the the sun is shining and the grass is growing very quickly. But if you have like an entire week of rain, I probably would just go ahead and send it if.

Because the grass will still continue to grow this time of year.

Landon Smith where do you determine where to put yard signs? I got 50. I wanted to put them out in a couple neighborhoods. I got it. I get how to place them based on the videos you have, but the problem is last year they were all getting picked up or removed. How do I know where to place them where this won't happen? I would say typically if you already know where to put them. So I'm gonna skip over that. I would say in terms of like not getting them picked up. Go where a lot of political signs have been in the past and they're typically won't get picked up. So you most of us already know kind of generally as you drive around like where a lot of the yard signs go for politics. If you put a yard sign there, usually it won't get picked up as often because people are used of seeing them for the vast majority of the year. There'll be something there.

Nick from Marysville how is Billingham doing with projects this year? I have noticed way less project leads than last year. Not to mention my close ratio is Becoming low on projects. I'm concerned about staying busy through the summer at this rate with the guys I have now. Do you have any suggestions? Right now, we are still busy with initial MO's and recurring, but I'm trying to plan for summer and make sure we are booked out.

Okay, Nick, I'm gonna give you some tough love that might not actually be pointed at you, so don't. Don't take this personally. I'm just going to make this a generalized topic, but it may or may not apply to you, and that is that we have to get off the treadmill of, like, I don't have enough employees, and I'm working crazy hours, and I got to turn off leads, and I got to raise prices, and then literally a couple weeks later, being I got good employees and now I got to find more work for them, I got to turn. You're going to lose a lot of money turning on and off your marketing throttle, as well as changing your pricing back and forth, back and forth. That is somewhat counterintuitive. I just said, like, it's not hard to change to profit or growth mod, but switching it back and forth, back and forth, back and forth, it can be damaging. All right? And if you're going. If you're consistently seeing yourself where you have this feeling of overworked, not enough crew members, no one's coming into work. I can't convince them to work on Saturdays and Sundays. I'm just overloaded. I got to cut out jobs. I got to cut a project. And then a couple weeks later, you are thinking thoughts like, I don't know if I'm gonna have enough work on the schedule. There needs to be a mental shift. All right? Because what you have to realize is that.

This is the thing. You are. I'm not talking to you, Nick, by the way. I'm just talking in general here for a second.

What is happening, if I can pull this up, is this is.

Okay, forget it. I'll explain it.

What's happening is you're writing the. The supply curve way too much.

I'm sorry. The demand curve. And that is demand's going up and down throughout the year very, very dramatically in our industry. You've got to figure out what the happy medium is in between. Okay. I'm not dried out. Give me.

All right, so this is what our industry basically looks like.

I'm going to generalize.

Okay.

This is what our typical demand curve looks like from spring rush kind of lulls during the summer. That's kind of the concern, Nick, is Talking about then usually have a little bit of a bump for mowing and fall cleanups, et cetera, in the fall. Okay, here's the deal. You're not going to be able to get one employee here and eight employees here and time this just perfectly. You're not going to be able to. You're not going to be able to get a second employee here and a third employee here and a fourth employee here and a fifth. The timing of this is not going to look like that. What it's going to look like is you're going to probably go something like this.

The blocky one is your hiring. That's your capacity, your budget hour capacity as you grow your business much larger. The reason that this becomes less of an issue is because losing one or two employees isn't as big of a. Of a drop or incline of your workforce. So what's happening right here where this line is? This is where you would be like, man, I don't have enough work for my crew because you just hired two really good guys. And so, like, I'm just going to. I'm going to generalize. Nick, again, I'm not. This is not point at you, okay?

Right here is where you were two weeks ago. Not enough workers. No one wants to work. I'm going have to cut leads. I'm just crazy overloaded. Okay, now you hire a couple people, right? Like, finally, I've got a little bit of breathing room. And now you get to. This point is not to scale, but you get to this point where you actually have greater capacity than the work that you are currently getting completed. And you go into this like, oh my word, I've got to sell more jobs. Here's the thing.

What you don't know is that those people could leave tomorrow. And now you're right back to this. And then this person like down here is like, oh my word, now I'm overloaded. And you're going to literally burn yourself out. And so instead of thinking of it like this, ask yourself, how can I change demand to fit how many people I have on my crew? Okay? And that is.

Don'T cross the bridges too quickly because like, literally in two weeks you could lose one or two of your guys. And now all of a sudden, your supply and demand is exactly matched where you want it to be at. So don't be crossing bridges in July and August when you currently have a crew that if you just look at the historic history that, you know, one of our two of them are going to leave the next few months. Right. So again, this is not pointing at you, Nick. I'm just making a generalized observation and that is we are way too reactive to when we have good employees and when we don't have enough employees and we change our whole business and pricing and everything based upon that, and then we switch really quickly. It's very damaging. I would rather someone be like, this is the number of employees I'm gonna have. This is the capacity that I have is why tracking capacity is so important. If I go above this number, I'm raising prices. This is predetermined. I'm not going to allow it to continue. Go above and above and above. And I don't have enough employees. And if I don't have enough employees, I'm going to bring that number down. And then if I get to the point where I get more employees, I'm not going to be like, okay, growth mode, like, let's go grow, grow, grow. Because like that could be literally by the time you're performing on the work that you sell to be able to meet that higher capacity, like you have way more employees. You're like, I'm going to sell these jobs, let's go. Well, by the time you're actually performing them, because let's say you're four or six weeks booked out, now all of a sudden you don't have those employees. Now you're right back to burnout, right? So I would again, the reason that big companies don't feel this is because one or two employees is like 5, 10 of their of their workforce. They don't care. When you only have three, four, five employees. You have to be very careful about trying to adjust your entire business and everything around how many employees you have. Because in two weeks, two of your employees could be gone. And all of a sudden 30, 40% of your workforce is gone and you're right back to being overwhelmed, right? And you just, you just sent out an every door direct mail campaign for 5,000 mailers for projects, right? You're like, oh, sick, right? So be more. I would just recommend in general as a whole, in this industry, we need more deliberate about what we can, what our supply is and then match demand using our pricing to, to what that we want that to be. Instead of being like, oh, we got employees, all right, lots of marketing. Grow, grow more trucks more. Okay? And I was on two employees. Three employees leave at five employees. If that's your total and you go down to now two, you are completely maxed out. You, you're take, you're going to Be stopping all estimates. You're going to be falling behind. You're not going to have time to do interviews. It's going to get messy. So just, just I'd recommend for everyone. Again, I'm not talking to Nick. I recommend everyone not get on that treadmill of like, oh, I have excess demand. Oh, I don't have enough demand. I have too much work. Oh my word. There's not, there's not just you're going to get worn out, right. And that means that during spring rush you're not going to be able to usually capitalize on all the demand. Like you're not probably going to be able to unless you know that employees are going to leave fast enough during the summer. Right? You have a hive churn in an industry like ours, you can, you can scale up to 5, 10, let's say 10 employees, knowing that over the course of June, July, August, that's going to trickle down to six simply because of attrition. Right. And so don't overthink that too much. That's why a lot of people will not over hire like I talk about in spring because they're worried about summer. It's like look like, just look at the math. Like most people are not going to stick around until the summer.

All right, we got on a tangent.

12.

This is from Nick. Would spend more on marketing, drive more projects leads. It likely would if you, you switched more of your, you know, Google, et cetera to more landscaping type words. You change your, your Facebook ads or whatever ads around projects. I'm more inclined to really use one click estimate emails to help somewhat with that supply curve. And that is marketing to your existing customers about certain projects that you can do. That's usually the fastest way to increase budget hours, especially during a lull like Summer. Garrett from Glendale. Last question. After Connor Hutchins post about using SBA7 a loan to open locations, I've been watching videos and listening to podcasts about the process to educate myself. It sounds like for an existing franchisee that already has one successful location, decent credit and a little bit of cash that it would be very easy to obtain a 7A loan. How would you recommend deciding whether to go grow debt free or to finance the new locations putting 10 to 20k cash and 60 to 80k debt. How do you calculate risk into this equation? Obviously I'm a little ways out from this, but you just curious your thoughts. It sounds like you chose franchising because you saw how capital intensity is to scale multiple locations. Do you think franchisees will come to this conclusion in subsequent years. It sounds like you and Alex Formosi came to similar conclusions with Augusta and Jim launched that you can scale faster through line set licensing or franchising. Just to be clear, I'm not doubting the model. Just wanted to ask your opinion. As I've been thinking about this the past week. Great question. So, yeah, if you. Because you're talking about Alex Hormozi, I'll use his analogy stuff. So the first, you know, leg of what they talk about in terms of having a higher opportunity vehicle or like a utilizing things outside of labor, right? Because you go labor and then the next thing that you can use, you can use like software and other people's labor, etc. The highest form though is using capital, right? And so if you start using capital like this, you will grow much, much, much, much faster. So, for example, if I would have put, you know, the $400,000 that I'm spending on the four locations out in North Carolina, if I, if I wanted to grow massively, I would leverage that $400,000, I'd go get an SBA loan for, let's just call it 3 or 4 million, and I'd go start 30 locations. Totally possible, Higher leverage opportunity, much faster growth. Do I want to take that risk? No. So this is a personal decision and that is, do you want to deploy that much risk and grow that much faster? If the answer that is yes, my next question is why? Right. Like to me, my goal in having the four locations is I can prove the executive model improve and see what bumps come into play. When you start opening four or five locations in one sitting in one month, what happens? What are the breakages? What do we do when you warn people? That was my objective. If my objective was to make a ton of more money, it would be, yeah, I could leverage that. I'd try to get a 7A loan for 10 years. I get 3 to 4 million dollars, put 10 down, get like 5 regional managers, 30gms, and yeah, that, that's what you would do. So whether you use software, use other people's labor, you use capital, there's just different forms of leverage, right? And so at each of those stages, there's risk. All of us right now are using other, other, other people's labor. That is a form of leverage. Because if there's, there's risk involved, you have to pay for insurance. There is liability of them suing you. There's liability of them making mistakes. Like we just talked about with out in Arnold, they got a Thousand dollar mistake. There's the risk to that, right? But you do it because there's higher opportunity for growth, more profits, et cetera. The same is true when it comes to software, as I'm learning. It is far more scalable. It is much higher leverage. However, it's extremely expensive and there's risk to the fact that you can become completely obsolete in a matter of a year with technology, the way it's moving higher, higher risk, higher leverage. Capital is the highest form of leverage because you can take $10 and turn it into a hundred simply by signing on a piece of paper for that loan. Literally, extremely high leverage, highest form of risk, because if everything goes bad, you still have to pay it back, right? So.

For people who have been employees in the past, and especially if a sole operator, you are thinking in terms of using your labor, that's the lowest form of leverage. Then you have like other people's labor, then you have like software, then you have capital. Like there's other forms of leverage and there's varying degrees of how you use those different levers that make them more or less risky.

But I would say that if I was giving advice to someone, I would say conquer the lower levels of leverage first, and that is figure out the, the use of other people's labor far before you start trying to figure out allocation of debt. Because if you make a bad hire, guess what? You fire them, you move on, they leave you, they hate you, they leave. Like that's the worst case scenario. Worst case scenario for debt is you either A, go bankrupt or B, have debt that you got to pay off. And now you don't have any money. Any money. So I would be recommending anybody have one location, really master it, make it very profitable, and then maybe do two locations, see how that goes. Figure out how to work with a general manager, then you're okay. This works really good. Great. I got two locations firing all cylinders. Great. I'm not going to go do three or four, because I could do that over the next couple years, or I could go leverage myself and go get five or six and start an executive model, save a little bit of money. And I know I can do this because I've done two of these and they're both firing in all cylinders. I got a great regional manager that can upgrade from being a GM into a regional. That makes a lot of sense. All right, that would be when I'd be like, yeah, green light on, on debt. Because you have mastered the lower levers of.

Of capital leverage, right? You have mastered those lower levels. And therefore I would say hey, you can go on to more and as capital distribution.

All right, what else we.

Listening to the book hug your haters really helps with responses and viewpoint on loud voices, at least with customers. My first guy is a family member. Now that I got another guy, I want to let let go. The family member seems not to be a good fit. I want to let him go, but the feeling isn't right. You have to decide between business and family. Not saying which one you should do.

I would have a really honest talk with them before letting them go. And what your expectations are and ultimately like I talked about the other day is if the business goes down, you're going to be letting him go anyways. So don't let the business be in jeopardy because of that. It's net. Currently we have 5 guys hiring 6 guy giving us about 180 budget hours capacity. And our weekly budget hours on the schedule are less than a hundred.

I hear what you're saying. So either I have all these guys but don't have the work for them going the summer or I plan to lose those guys and then we are overbooked. How are you supposed to run a business like that? But I don't have the work for them going this summer or I plan to lose these guys or about.

God, you're getting okay. Last year we only had enough work for two guys in the summer because we we bombed spring. I get statistically they won't stick around, but I don't want to go back to just two guys. Yep, great point. So what I would recommend doing is before getting that excess of capacity because you have a lot of capacity right now and that is 180 budget capacity and your weekly budget hours. Oh, I see you're recurring is 100. Got it. So basically your goal is hitting 80 budget hours per week of projects. If you can do that, you'd probably keep them all busy, right. What's nice is projects you can move around, right. So let's say that you do get six guy one or two guys leaving in the summer. You're kind of overbooked projects. You can move around a little bit more. Right. So I would recommend doing.

I'm assuming right now you're you're at capacity like everything's fine. I'd be focusing 100 of my time on booking your schedule out like as far as possible. Probably like I'd consider yourself full like 160, 170 budget hours and then moving on to the next week. That'd Be my only preoccupation. And I'd be selling projects like right now. I'm talking to you, Nick now because I know your market. Um, you can sell, still sell projects. 1, 1 click estimate emails a lot because you're still in spring rush and everyone's thinking about it. When like last year you had leads turned off for projects. Right. So I would go hardcore on projects, sell them, but then book out into the future. Right. Um, I would only be doing like marketing for projects if I was at least four weeks booked out. But you will have way less if you're kind of anxious about like, and stressed about like, am I going to keep them busy enough? You can simply solve that by booking your schedule out. Four weeks. If you're four or five weeks booked out, you usually sleep pretty good.

Roger. I'll just do a one click. Just seeing less projects and less acceptance in years past. Yeah, we're kind of seeing the same thing, just in general, like less leads for projects, a little bit lower acceptance. But I can't really say that. Like our close ratio at Bellingham still like higher than last year, but we just had less leads organically coming in. So less leads, but higher close ratio, which is interesting to me. I don't, I don't have a thesis on that and I haven't seen that as a broad based theme. But we are seeing less leads, but we're closing a lot more of them.

So I think last year we're like 33, 35. This year like 42, 45% close ratio, but then look significantly less leads. And that's just all. We don't do a lot of marketing. So it's mostly just organic stuff. Right. So I think, you know, booking yourself out in the future, knowing that you have a massive advantage by having these employees compared to last year because you can market for projects in the spring rush and then book those out in the future. Right. I would just consider yourself like fully booked at 160 or 170 and not 180 simply because you don't want to run your run the risk of running full gun 200 budget hours and then one or two guys leaving and now your capacity is down to 120. And what's going to happen in that case is you're going to cut your project out and just focus on mowing so you can maintaining that 100 budget hours. Right. So great work, man. Great. Really good. All right, everyone, have a great rest of your day. We'll see you tomorrow.