Mike Minutes Mastermind 06/07/2023

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Okay, let's get started. I thought there's quite a few questions that came in, so let me just open those up right off the bat. A quick update here. Like usual. I'm recording a daily video for you all. I'll make that all available at the end of the month. But. But my general manager flew out here yesterday from Texas, picked him up and he's already doing door hangers today looking for a place for his family. Has seven kids and another one due in a few weeks.

Amazing, incredible, crazy, whatever you want to call it.

So he's very motivated. He's done lawn care and landscaping before. He had his own business before COVID and actually scaled it up to like six employees. So I'm looking forward to it. Yeah, let's jump into it. Let's jump into some questions.

Oh yeah. 11. Let's go. Tyler Kukle, how many budget hours are you seeing working GMs completing the field each week after admin work. So I'm thinking probably July or August once we get through spring rush and every. Everyone's starting to think about next year already and like you might be in their general manager roles, etc. I'll probably do like a a thing with Chuck and Lee and kind of go over general manager stuff and how to calibrate certain things. The max metric we use for general managers 30 budget hours of work is they should be completing a week minus half an hour.

Sorry, minus an hour for every estimate in person and and then an hour for every interview that they have to in person estimate it's an hour. If it's a drive by, it's 30 minutes. So if you have 10 drive bys on your schedule today, technically you could take off five budgeted hours of work for that day 30 minutes apiece. But ultimately I still expect someone to be able to do the full 30 hours worth of budget hours a week if there's not any estimates or interviews. Because ultimately the role of the working GM is a general manager's role is to sell jobs estimates, interview job team members and train them up and then secondarily is working, working gm. So if I'm not doing estimates, I'm not doing interviews, I'm working. And so basically work backwards. 30 budget hours worth of work, minus 30 minutes for every drive by estimate, minus a budget hour for every in person estimate and minus an hour for every interview that actually shows up.

Number two, Kyle Tarvin.

Is there something we can do with SA to notify us if a car is not added on file within a time period? CC is automatically scheduling mo customers without ever getting a card on file. We service the customer for a month and then send them a bill and they refuse to pay. So they didn't get a card on file or for whatever reason didn't actually want to get on the schedule. So just to be clear, if we do an over the phone estimate, we do not allow them to be on the schedule without a card on file.

Unless you specifically tell us otherwise inside the.

Wiki. But they can't do that. What can happen is they can request an estimate, we send them an estimate, they accept it. Right. And then it comes back to us as an accepted estimate. And unless you've said hey, everything that's have a credit card that potentially might get through because like with a landscaping job or something like that on that estimate it could potentially get through. So I would probably ask command center if you can clarify things on your wiki a little bit more and then I think we need to do some sort of a call with the customer for scheduling. I wouldn't recommend this.

We have roughly 4, 500 in unavailable invoice because we're not enforcing cards on file before CC schedules them or at least we are not looking to ensure they have a credit card on file. You could set up some sort of automation that basically makes sure they have a card on file.

In copilot by the end of this year we'll have the ability to where you can make this. They can't even accept the estimate without having a card on file and so you won't even get notified that an estimate has been accepted. The problem is with service autopilot to put a card on file is such a pain in the butt. Like they have to do the whole login thing and the security questions, et cetera, that sometimes it deters them from accepting the estimate and then you lose out there. So.

In terms of the $4,500 I think you get that that seems unless there's like one large one. But if that's just for moen it would be like a lot of invoices that are not paid and so I think you could get those back pretty easily just for the good collections follow up process.

Is he just upset that we have been taken advantage of because you don't double check or enforcing cards on file before they have the thank you welcome emails? Got it. So you'll want to make sure communicate with command center about your wiki because you can just tell them like look before you send out the thank you welcome emails I want to make sure there's a card on file because otherwise what's happening is if they have a property clip, a multi job and a mowing and they accept that estimate, they're getting the thank you and welcome email. They're not putting a car in file, they're going to get scheduled and so they can absolutely get in that way without a card unless you've told command center otherwise. And I'm also assuming that command center doing your scheduling so that sounds like that's what they're doing too. So just keep in mind in copilot you will be able to have options of deposit amounts as well as having a card involved before they even accept the proposal.

Al Tarbin why do most lawn and landscape companies lose money during the springtime and don't start making profit until the summer months? I'm finding this on NRP now. The last few months have been really rough financially. We are slowly getting the green. I think June will be our first positive cash flow month. This is very common in the first five years of business. It really literally takes five years usually to get to where you can start being profitable in like March and April.

But when you're in your first couple years especially it's very, very common to not turn like above zero until July. The reason, and that's what you're asking for is a few things. 1. All your marketing dollars are typically spent at the beginning of the year. 2. Your crew is the least efficient because they're all brand new, they're jumping in the spring rush and they're not efficient at all. 3. You have less route density at the beginning of spring rush compared to June and July because you simply have more customers at the end. And so your overall efficiency just in having more customers also increases. Three, you aren't as accurate or pricing jobs as accurately. And so it leads to more pitfalls, damage cases, guys leaving. You're learning. You know, when I say you, I'm talking about generally when you're in the first couple years you're learning how to manage. You're also figuring out the supply Curve. So when you should be hiring people. And so with that, if that is off, it always leads to less profitability because if you understaff you, you're going to lead to overtime and burnout. And if you overstaff, you're going to lead to inefficiencies. So figuring out that demand curve over the course of, you know, five years, you start to nail it every time. You can become profitable relatively quickly, like March and April, but usually in the first couple years of a business especially, I don't see people being profitable. So until then, July and August and in the last five months of the years where you make literally all of your profit because you go down into a hole of spring rush, you come out during summer, and then during fall and winter you actually make good money. And that's why honestly, in my opinion, like Equip Expo is a perfect timing in terms of like showing a bunch of landscapers equipment because that's when they have all their money. And that's why I see a lot of people blow their cash reserves in November, December because they just had four or five months of really good profit. But yeah, spring rush, you're also the fact that you're doing a lot more estimates, which means your, your percentage of your day spent doing revenue producing work is lower. So if you had a hundred estimates during April, but then you only have 40 estimates in June, you're like, oh no, I have less work. Yeah, but those other 60 estimates, now all of that time is spent out in the field and you just generate an extra 3 to $4,000 in revenue just for not having to do those estimates. Oh, and by the way, your command center bill goes from $1,000 to 500 because now you're not getting new calls and leads and customers complaining and onboarding new employees and all the rest of it. So stabilization of your customers, stabilization of your employees. The thing I'm running to right now is now we're in June. All those new leads that typically come, I don't get those, I got to focus on projects, right? So that's what everyone else pivot to because like as you slow down you're like, oh man, I got all these guys, I gotta get projects. But that's typically much more efficient because that those crew members have been trained up and are efficient already.

Landon from Landon from Tallahassee, Florida, trying to grow as fast as possible and have guys lined up to start and currently being trained. I need to make sure I have work for them. But leads just aren't coming in as Fast as our leg. We are just now starting to pick up here. If I'm trying to grow very fast, would it be a good idea to expand my service area outside the 5 miles and then bring it back once we're in the growth model? If this sounds like a good plan, what's the biggest radius you would recommend? I would not recommend doing this unless you have a very, very wide expansing highway network. I'm learning this in my market where I only have a four, four and a half mile radius and it can take me 30 minutes to get from one side to the other. And it's a pain in the butt because the roads are like a grid, not a grid, it's like a web. And there's no like highways that like go all the way across. It's all just like turn 5,000 times. It's a pain in the butt. Great for gas mileage. Like, I literally spend no more than 5 or 10 miles getting to any place, but horrible for just getting from one place to another in terms of time.

I would only do this and getting jobs outside of your service, of your territory. If you want to expand your service area and those estimate those leads came in organically. So if they're already coming in, okay, fine, whatever.

But again, don't sacrifice the rest of your profitable months of the year because now you're trying to grow. Like, the worst time to grow is from now till. Well, no, the worst is the winter. But it's less opportune to grow in like July, August and July, August, September than it is in the spring rush. So if you've already like, you're like, man, we're just starting to find our rhythm. It's very likely after your first spring rush, now that you're in your website, starting to get traction, you're starting at leads organically. People are starting to see your trucks like that. That's just going to happen, right? But try not to force it too much in terms of growth the next few months. And expect the lead count to keep going up because you will need more money to keep that inflated lead count going. Or. And so what I would probably do is if I was just using, okay, if you have one or two employees, for example, let's take those guys, let's make them really efficient, really profitless. Lock in for the next six months and then next spring rush, line up your third, fourth, fifth guy, knowing that next spring rush, you're going to start off where you're right now instead of starting at zero. When you first got started. So I'm not saying that's what you should do. I'm saying balance that out with how much cash you have available. Because the ramp up of leads that you're feeling right now is simply due the fact that you've just got like some. Some brand awareness is starting to kick in a cup, you know, a couple trucks starting to roll around. And that's not going to be sustainable in November, December, January, February. So just keep that in mind. I want you to make sure you're profitable enough the rest of the year so that when you go into next spring rush you can actually take advantage of it, have a few guys ready to go and actually really scale then instead of trying to force that growth now, spending a whole lot more capital because you're not in spring rush.

As I'm finding out.

This question is from Anonymous. For the. For the door hand guy you just hired $20 an hour, $10 per lead and $20 if the lead closes. How many door hangers are you thinking he will get out a day? Right now he's getting around two to 400. It's only been two days. So I think the first date did 170. It was like a half day. And then yesterday it's 370. However, he is knocking on doors. If you put out the door hands just one after the other after the other, you wouldn't have to do that. You know, this guy, he's homeschooled and he does not mind talking to people. So yeah, yesterday you got two more estimates that I have on my schedule for tomorrow for in person projects. We're just finding no one needs mowing right now here. Everyone just wants projects. We've got only like two mowing customers. Everything that's coming in is projects like property cleanups, bush trimming, mulch. So we're just leaning into it. I got a whole bunch of door hangers for property clamps and for mulch on the way. So kind of pivoting there.

But yeah, like the. If you are interested in door hangers, look at Connor Hutchinson's video on the Facebook group. I think he accidentally posted it twice. Regardless, watch it. It's really good. He's been doing a ton of those and they've scaled very quickly up in his. At his location.

Also Anonymous is the door hanger guy. Cash. Are you running payroll? I'm just doing him cash. He's gonna be two to three weeks that we'll use him for. It might even be less because now my general manager's here Depending on like today my general manager showed up and is going to start doing door hangers. So if only next few days I get quite a few leads, I might only keep Jonathan the part timer guy, young guy, for like another week. We'll just see. It just depends on lead flow. Another anonymous question. What is starting salary for your gm starting from scratch, like the one getting ready to. Would these change if you were giving him an existing location doing 500k in revenue already? Yeah. So in terms of starting GM, we start them all. Thousand dollars. Like a thousand dollars a week. Basically. Incentives are aligned with their. If they're starting from zero, it starts their. Their salary can go up in year two if they just grow to a certain number. So their growth in year one determines their salary for year two as well as their profit sharing number. So that number goes up to 20, 25%. They're really incentivized to grow that first year if they're starting from zero. If I was giving it to someone who's already 500k, I'd probably be giving them an hourly wage.

Plus a profit sharing because that point they're going to have really, really long hours during spring rush managing the crew and less hours during the winter. And I would obviously make sure they have the hours like optimized for them. But if I was giving a location that was already doing 500, 000, I'm probably going to put them on an hourly role in a role that has an hourly position and press plus profit sharing. It's not going to be. It's not gonna be 25, but it wouldn't depending on the revenue. Right. Like the Bellingham shop, they're only getting 5 to 10% of profit sharing because it's, it's very established. You're walking in the door with, you know, already kind of knowing what that revenue is going to be and profitability. So it's less. Whereas like if it was 500, let's say it's a location has 600,000, I would probably give that person an hourly rate in terms of position and then.

Probably like 15% profitability, but then give them incentives to make that higher. So for example, if you get certain amount of profit, then you get a little higher percentage. So something like that. In the perfect world, if I'm doing nothing at the location, I'm willing to give 25% of profit, but it means like I'm doing nothing if I have to show up at all. That's going to come down very quickly. And then if they, if it's already been established prior to them showing up. They're also not going to get as much because they didn't have to go through the first year. Two years where their profit isn't as much. Like the guys that get a salary crush it their first year. Maybe their salary go up to 60 or 70 over the first couple years. But that first year there probably was no profit sharing, right? Because they grew so fast and you know, year two made a little bit profit. It's like year three. If they grow really quickly and they sit on it as a general manager, that's when they can make really, really good money. If they grew really quickly and then they turn into profit mode in second or third year.

Landon Smith moment is just picking up here and we are in hyper growth mode. However, leads are coming in fast. Either these I think I'm guessing you said are not coming in fast. Should I switch to advertising, property clips, landscaping, etc to fill my guy's schedule on top of expanding my service? Here to the last question. If so, should I create multiple ads with one service, one service at the center? Right now I run $20 a day. How should I distribute that out? If I run multiple things, you're running multiple to split it in half, do $10. You can do it as low as $5 a day on Facebook and Google for a campaign.

I would be very inclined to believe with almost full assurity that if you are getting an increased number of leads like over the past five to six weeks that if this is because of brand awareness and your website is not because of your Google or Facebook or whatever ads you're running. So just keep that in mind. I also want you to think like oh, I can spend more money and solve the problem. And a lot of people attribute spending more money like I'll get more leads. It's like no, you are six months in your business now. People are seeing you and you have 20 or 30 or 40 Google reviews and things are starting to rolling on Facebook, et cetera. So just keep that in mind. I'm not saying not to do what you're talking about. I would definitely pivot your marketing from to more projects, property claims, et cetera. Especially when you if you look at your estimates and as they decline, only 20% of them are mowing, right? So I would just look May is going to look solid for everyone, but I definitely look at everyone's June your June numbers. Okay, what percentage of my leads are coming from mowing? What percentage are landscaping? If I'm still spending my money on Mowing ads Probably not a good idea if only 2030% of them are asking for mowing and everyone else is like property clearance, bush trimming, landscaping, mulch, etc. Probably a good idea to follow that trend instead of fighting it in terms of optimization of your CAC Eric Largo From Florida context I am out of the field recovering from surgery. Oh still training. Okay. Have two employees, one vet veteran and one newbie that started this week. New guy is is my third attempt at a second employee but I believe he will be solid the next four weeks. I have an average of 36 budget hours to definitely have capacity to fill. Got it. Okay. I started marketing back up two weeks ago. Google local services, Google search and some door but lead flow has been slow. Also have sent out one clicks recently mowing for non recurring customers and bush trimming and tree trimming for recurring customers. What do you think about sending a revised mowing lower prices to so I would first say regardless. I know typically this is what we do and that is you send mowing for recurring non recurring and bush trimming center for recurring. Keep in mind that that your recurring database is likely to be like a 10th or 20% max of your database. You said still sent mowing to 70 to 80% at least of your database. I would flip that this time of year because again mowing is not like I'm finding this out firsthand. Starting a location from scratch with no brand awareness. There's no one looking for mowing. I'm ranked like number two in the area already for mowing and I've gotten two jobs and both those came from door hangers.

I think the first one did. No, the first one did not. So one came from door hangers, one did not. But all that to say I'm not getting mowing estimates, I'm getting landscaping estimates, I'm getting project cleanups and I'm getting bush trimming. So I would flip this on your one click estimate emails right the time to send one click estimates for mowing was three months ago. All right, we passed that. There's less demand and you're either going to fight it by spending a lot of money or you're going to spend that money towards something that has a low a lower customer acquisition cost which the services are going to be more project based. What do you think about sending revised mowing quotes with lower prices to customers who have recently canceled due to price or price increase? I did a heavy price increase in March to reduce workload ahead of my surgery in April. Customers who Declined recent mowing quotes. Figured I can word it as if we're trying to fill a few remaining spaces on their mowing route before the summer rush rains season here in Florida. I think lead flow will start picking up with demand, but was thinking this may be too low hanging fruit. In the meantime to get a better baseline BH budget hours hesitant because it looks like it might be a bad look to the customer. Thank you for your insight. I probably would not do number one and I was like, oh, we raised your prices, you left. Oh, we'll have you back. I probably would not do that. I would just keep them in my database so I can get them in down the road.

Also keep in mind, let's say you send out number two even and you get three or four customers back, you're still only going to be at like 3,839, 40 budgeted hours. So if you're trying to solve that problem, you literally need right now 20, 20 to 25 budget hours to fill up your guys schedule. It's unlikely, not to say impossible, especially once you guys get the rain in Florida, you might be able to do this, but to think that it's going to do it all. With mowing, I would, I would probably use the next few weeks and you kind of go through a dry period before the rainy season. I would probably focus more on projects because you just need to sell literally three project cleanups, like three property cleanups a week and you will fill up their schedule, right? So if you're trying to fill up 24 budget hours, 8 hours per cleanup or mulch install or something like that, three of those a week is probably easier to get over the next few weeks. Let's just call it four weeks. That's 12 jobs you need to get in the next four weeks. Next month you need 12 jobs for property clips to fill their schedule. If you got 12 mowing jobs, you'd still probably have 42 to 43 budget hours. So that's like if you're trying to fill the schedule, projects is going to be what you want to go for. All right. Is what we say all throughout the stages of growth. Use projects to book out your schedule and then your mowing is a slow growing thing. Okay, I'm not opposed to number one and number two, I probably would not do number one just because it's a bad look. Number two, I'd be more inclined to do that. Just keep in mind, even if you got in the best case scenario, several people, it's not going to fill this Void. I don't think. I'm not saying you should not do it. I'm just saying don't think that's going to fix your budget hour issue. Your budget hour issue. If you think that's going to be resolved in a couple months after the rain season et cetera. I would be focusing more on projects right now and I would be flipping your one click estimate emails that distribution to be more towards landscaping and projects.

Sorry, one second, I'm getting messages from Connecting. Boom. All right.

And we're back.

Evan from Connor or Connor? Connor from Evansville. Wow. Okay. How do tickets work on sa? I am full service with command and when I get a ticket I respond to that ticket should it need a client resolution or resolve etc. I would say a couple times per month I get an additional one or two tickets or we'll get a message on Connecteam about the same issue because the client called in again and the issue still has been resolved. Or when on my property I may hear that something never got resolved or the client never got called back even though I responded to the ticket and told CC exactly what to do or tell the CC agent to go back to the ticket and see my full response. Does CC not go back to these tickets and read the information, act on information, then either adjust the bill if you account or escalate the issue if the client is not happy. Just curious to know how tickets work because it makes me think that I need to go back to every ticket and confirm the actions been done or the account adjusted. So Liz can chime in here. To my knowledge, when, if an estimate, if a ticket is complete and you make a note on it, there's no trigger coming back to command center. Like we can't unfortunately make a automation based on notes. We're working on one inside COPA and that is. But when you get like a ticket or in our case a to do you see the notes in the email? If you complete the, if you complete the ticket, there's nothing that triggers anything back to command center. The only way it gets caught is if they are doing your dispatch board screening every day. I forget what it's called. Dispatch board. We just call the dispatch board department and they go through your dispatch and they're looking for these things. So if, if you're responding back to a ticket that commands and are created for you. For example when you click complete there's nothing coming back to us. It is a matter of us having to screen the dispatch board kind of like end of day. And so if you're not in the dispatch board department that is doing that. I would recommend everybody on service autopilot just go through dispatch board at the end of the day once everything's been completed, new things that are not move off things that have not been completed yet. Make sure everything has been marked done. If it's not, it should be moved off or something should be done with it or skipped or something. And then look, you're. What you're also looking for is notes from the crew as well as potentially yourself and if there needs to be certain actions taken. So if you are in the dispatch board department of Command center definitely would want to chat with them, see why those things are getting missed because that should not be happening. But if you're not in the dispatch board where they're actually going back and checking all the notes of of the tickets, then we there's just no automation of to notify command center if you left a note on something. So these are the type of things that we can adjust and refine in Copilot because we're not we're doing workarounds. Liz, if I'm wrong, feel free to comment here and make a quick video as a comment.

Ken from Michigan I had a question about the deadline for Growth Model signup. When I first signed up, I originally wanted to sign up for Growth Model.

Because I had the money but was advised I had I was more suited to be a solo operator model at training. It was verbally stated that if you want to stay solo operator, you can. Even though I have full intentions to move up the growth model, I am worried I will not hit my goals this year to pay for it. Savings for winter in case I get skunked with skunked with mowing with plowing Again, I'm trying to save up to buy a house. So my question really is does the timer start when it was announced that you only have two years or from when we originally signed up is from when it was announced. So the only reason it would be a year, which is not in your case, Ken, is if you were already above $20,000 a month. So we're giving it two years for anyone that is still smaller and working inside that solo solo operator model and the Franchise Advisory Council, I think it was unanimous or very close to wanted change and then the majority wanted it to be where there was actually a cutoff for the sole operator. So we went ahead and did that. And again, if you're like literally a couple months away from it at the end of the year, just please Stay in touch with your coach. That's all the main thing. If you're doing like 40, 50, 60,000amonth in revenue as a solo operator, we're going to be pretty hard on it. You're growing outside your territory. You've got to get something locked in. This is why the, the, the Franchise Advisory Council wanted to make sure that people get locked in. They, there's commitment and territories that are established because otherwise we run into all sorts of issues. If you look at things like Jim's mowing that never had territories, Subway that never has territories and then you get a lot of infighting because there's not established territories. So that, that was the genesis of what the Franchise Advisor Council brought to me. We all voted on it and the majority ran with there needs to be change. And then we voted on what changes were to be had and that was stemming from either scratching the whole program making changes and we ultimately decided on making changes to the time requirements. So you have two years from last January. So don't be in a rush. If you're under 20k, you're over the 20k. That's when the one year thing starts rolling. So I think it's very fair and I pushed more in the direction of leniency with the Franchise Advisory Council and that was ultimately was accepted. I didn't want to can it completely because I do like people to be able to get started and, and be able to get started for less. But the eventual goal is to become a growth model, secure territory and so we don't have problems down the road between franchisees.

What are your recommendations for financing a vehicle? Do you recommend going through your bank, the dealer, an online lender, typically your banks and a credit union. Local credit union is going to be your best bet in terms of interest payments as well as usually just the way they treat you. A dealer is typically going to have sometimes the best if it's new. New financing from a dealer is typically the best because they're doing it in house and they make all the money. Just be very careful of your initiation fees, the initiation of the loan. So a lot of times they'll be like oh, it's like 2% dealer, 4% the bank. The bank has $100 initiation loan. The loan on the financing cost at the dealer might be three grand. So just be careful of that. There's always a pink this thing up. And dealers make their money on financing. They don't make it on the cars. What is, what is Bravo a manufacturer? You're looking at buying.

I'm thinking of talking about the mowers, the 25 inch mower decks.

I'm not exactly sure what you're asking. Sorry. What is Bravo a manufacturer? Oh, it's. Yeah, it's manufactured for the mowers that we're, we're testing out in Bellingham because the push mowers from Honda are going out. Is it possible to open three Solo Operator locations and hire three people to run them as a GM and just assume that you won't make any profit for two years? It is not allowed. The Solo Operator model is built so that you can get started in Augusta. If you don't have enough capital and you're tight on cash that for 20 or less, $25,000 you can get started. It is not a destination and you're definitely not starting multiple locations using the Solar Operator model. It is exclusively to be able to get started, learn the systems, figure out how to get to 20 plus thousand month in revenue and then from there you should be focusing on locking in territories, getting general manager in place. It's also just job security for that general manager. Like if you haven't locked in a territory and spent some money, I would be hesitant as a general manager to even get involved in your operation. Like I would not have someone moving across the country right now if they didn't see me already have started six or seven of these. They've all been in business. They're being supported that he got the training. Like there's a, there's a track record. And part of that is that he's already seen me buy two trucks and a trailer and I have storage facility. He's ready to move his house like his whole family in a day or two because of that. So if you're like, oh, we're gonna like do it for my house. There's gonna be one truck and no, we're solo operated. We don't have a territory. You're not gonna get a great GM and that's the type of person that you would need for any successful location. And we are learning this the hard way over the past 12 months and that is general managers 100% dictate the success of a secondary and tertiary locations. 100%. There is no other factor that is I don't care about the market, I don't care about your advertising, I don't care about your pricing or your profit margins last year. If your general manager is not the color of a person to run a high efficiency organization, it will fail. I don't care how good you are. It will fail. So that's just my two cents. All right, guys. Pretty long one today. Hope it was helpful. We'll see you tomorrow. Take care.