Mike Minutes Mastermind 07/03/2023

Hello, guess nation. Hope you're all doing super well. Happy Monday back in the office. Nice to have fast dinner again. Let's go. Let me go and drop this link in.

See here Copy shareable link.

All right. If you did not get it last week, make sure you check your email or check the Facebook group. There was a link sent out for the Franchise Advisory Council. If you want to put your name forward on to.

The ballot, definitely feel free to do so. No pressure whatsoever.

Let me just drop this into Facebook real quick. I kind of outlined on there the expectations. We don't take a lot of people time on the Franchise Advisory Council. I try to make sure that's not not the case. I try to make sure that we mostly just use the WhatsApp group of the Francis Advisory Council to bring questions forward.

Voice opinions that might be coming up as well as.

Vote on stuff. So also sometimes just like put a post in there and they have to vote on what, what they want done. Keep in mind, you know, ultimately I still have to make the decision, but I take into consideration heavily what is being said. But there will be, there will come a time where I go against the Franchise Advisor Council's best wishes that that will eventually happen. But it's definitely a guiding principle for me to make sure that I would say 99.99 of the time we're going to agree on things, but if I'm thinking in a certain direction, maybe I need to come back just a little bit to kind of be more balanced and by getting their opinions and seeing what they're thinking, it's very, very helpful for myself. So I would look at it as honestly more of a decision making framework for myself than anything. So I appreciate anyone that is on it. It obviously is not so much time commitment for them on the group. As much as people are going to contact you more, they're going to want to voice their opinions to you more. And so I do appreciate that the group that has been on there the past year and if you would like to put your name on it, feel free to do so. But yeah, don't feel obligated. It definitely is some somewhat of a time commitment. I try not to make it too cumbersome though. All right, let's go ahead and jump in. We got questions, nine of them. Let's go. Let me make this a little bit narrower. All right, Charlie from Nampa, Idaho with the. Oh, Franchise Advisor Council 1. All right. Whoa. What happened there? Mercy.

All right.

Oh, there we go. Yeah, Let me fix this. Sorry. Okay. With the voting for the Francis Advisor Council coming up.

Okay, one second. Sorry, I just gotta fix this microphone. I'd like to bring up some thoughts I've had and get your take on it. This last year some changes came out about to the solo model mostly which I agree agree with like the current stance that the current clock starts ticking after reaching 25k. It's actually 20, I believe in monthly revenue. At that point they should be bringing in enough to save for going growth model. But it also sound like that model could have been eliminated if not for your support. Support? Sole support for it. I think as we grow these those early years and the sacrifices made begin to fade away as you continue to expand and scale.

Those early years and sacrifice may begin to feed away as you continue to expand and scale. Those who start out as solo are often the ones with the least financial security experience and business savvy as they venture into entrepreneurship. The solo model also seems to have the least amount of support and I feel those owners could greatly benefit by having one of their own on the Franchise Advisory Council. What's your thoughts on having at least one spot be reserved and voted in that is a current solo model, if only to have some representation for the solo models and to advocate to continue allowing new entrepreneurs this option. I'm not sold on this 100%. I have thought about this. I could be convinced otherwise probably, I'm sure, but I've kind of made the decision to not artificially change who gets in the Franchise Advisory Council because for several reasons. One.

The goal of every solo operator is to become a growth model like scale and grow, etc.

And even if it is to get to say 30 or 35, get a couple employees, whatever it might be, but have an actual territory. And so last year for example, there was, there was members on the Franchise Advisor Council that wanted to completely be away with the solo operator model. And I basically said that's not on the table. I said that we're keeping it. It's a matter of like how are we. What. What do we need to govern on it to prevent misuse. And so.

In terms of having just one on the solo, I don't think it's necessary because if a solo operator comes on and they're involved in the community, they're talking to other solo operators and helping them, they're coming to events, they're making sure everyone that they are helping, that they're involved in, in the Facebook group, et cetera, they're going to get voted organically. So I don't want to like, artificially, like, okay, we're going to have one person from the west coast and one person from the east coast, one person from the north, one person from the south, like one person from Canada, like, I'm not going to get in that. It's like we're just going to vote. And the owners that are bringing the most value to other people and are in the most groups and most connected are probably the ones they're going to get in. And that's what I need as the, as the CEO is someone who is connected to the most people. So if a solo operator model, a solo owner is not doing that, they're not going to get in. And so I'm not going to artificially change anything right now. It gets too complex and then it's a matter of like, well, then we need someone from Canada, we need someone from this state, we need someone from this side of the U.S. we need someone. It's just like, look, we're going to make a vote. The people who are the most connected, the people that have the most connections and are helping the most people will get in. And that's the person I need to be able to have a year to the ground on. And so I'm not going to artificially change it. It will come into consideration though, if there's a tie and I have to do a tiebreaker, I would probably default to something like this. But my inclination is to not start making artificial segments of who gets into the Franchise Advisor Council. And again, there are times like last year, I will go against what, like, they're trending. It's like, hey, that's off the table. Let's vote on these things because.

We'Re not going to do away with it. It's a matter of, you know, what, what, what do you, what do you guys see as the best option forward? So this, this was actually voiced from the Franchise Advisory Council last year existing saying, hey, like, hey, just so we're all on the same page, none of us here are solo operators. That was voiced and it was a point of.

A counterbalance to our decision making as to why, what they are deciding on. So it's, it's very much forefront of mine to the franchise of vowel Council. That's current and it would be in the future as well. But ultimately I think there will come a time where I'm like, I, hey, you guys, I just disagree with you and this is the way we're moving in the best interest of the whole brand. But there will, you know, there will come a time I have to go against all of it but it really helps me like just counterbalance. It's very, very helpful. So my hope is that if I ever have if an extreme, you know, anyone at the in the executive side has an extreme opinion on something that it's counterbalanced even if not brought to the complete opposite side, it's at least balanced a little bit more. Kind of keeps things in check. Connor from Huntersville, North Carolina. Can locations choose to switch over switch on their own to have CC transfer all client information to Copilot in this? If this is the case, what should we consider to help minimize the cost as we prepare to switch this fall? Can we provide other data outside the normal name, address, etc like property size to be input? Yeah, so you can import.

Custom fields and so all you have to do basically is have a custom field in Service autopilot, have a custom field inside of Copilot and then on the merge you can just connect the two. So what I would recommend doing, you can get a free account of Copilot and see what comes across and make sure it's all lined up the way you want. But by the time January rolls around like in December, we will make sure that like November, December, that command center has a system in place and process for getting people to switch over and bring all that information over. That being said, there's literally a walkthrough of importing data and we're using Service Autopilot as the example. So you could literally just follow along with what is being shown on the CSV import.

Next question is from Joel from Lafayette. Could you throw out some of the ideas you and Chuck had for first and second year GM compensation? I'm using the bonus structure Brian Connor I think suggested that is mostly based on annual revenue targets until 500k. I've been rethinking my GM compensation recently to see if there are shorter, shorter term incentives especially for the first progress. So I'd like to hear what you're thinking even if they are half baker untested ideas. Yeah. So you know this is very similar to what we have now in terms of like revenue targets to 500K. What we are. The trouble with that is you don't have an annual number until the end of the first year. So what we are in terms of your question specifically like more of the short term stuff, what we are likely going to add is incentives are on monthly revenue in perpetuity. So like if they get from 0 to 20k per month in revenue, no Extra bonus if they between 20 and 40, there's a bonus, 40 and 60, there's a bonus, etc. So that way revenue is rewarded in the first year in addition to what they're going to see in terms of profit sharing down the road. So literally I made some changes yesterday that Chuck and I are going back and forth and several things. This, the changes really for new locations, existing locations, where you've been when the location's been around for 10 years has multiple GMs that have been in place. You've got to negotiate on an individual basis because it's so different when the location is started brand new. That's where the GM compensation changes are probably going to affect the most. Because existing locations, it's easy to project profitability, it's easy to project revenues. You're not like guessing whether or not someone's going to do 20,000 or 150,000 in monthly revenue. You know, if the location's been around for years. But if it is brand new, you really want to give them that scale, the, the incentive to scale. And if waiting for the first year like okay, you hit 250,000, here's your bonus, that's a whole year. And honestly your churn on a GM level for six months is going to be your highest. And then if they can make it for the first six months, it'll go down. And it'll go down even more if they can get through like two or three years because that's when their profit sharing really starts to take off. So the only other difference really is we will likely be looking at changing it from a P and L profit loss.

Profit sharing to a distributable cash. So when the owner takes money, the GM gets money. All of that we're going to talk about later, we have it nailed down. I just want to make sure that Chuck has gone over it, we've nailed down and then we get to the GMs it is only upside for them. For new owners, it's like a lot more incentive for the the GMs essentially, especially in the first year. But even going forward, like if someone stuck it around as a gm, the model we're using, they could really, really make it profitable like a lot of money for themselves. So.

To be continued. But I think that answer your question, that is more around giving them monthly targets of revenue, that they get a bonus on a monthly basis, even in their first year. So basically get above 20k as fast as possible because there's no bonus. And then after that you get more.

This is from Mike from Athens, Tennessee. Hey, Mike, in one of your masterminds, I believe it was the. About the time your GM truck, you stated that you had gone out of systems and Chuck mentioned it to you. Can you tell us how you went out of the systems and what you did to get back into the systems? Yeah, so I went out of the systems by basically allowing an employee to drive the truck after hours. We've always. And this is not necessarily a system of Augusta. This is a system that we've always had internally, and that is we just don't allow the employees to drive the, the trucks for anything other than on the clock work. And we've been pretty hard about it too. Like, guys ask a lot of times for like, hey, can I use it to move things like that. We've just always made a very hard line that it's a no. I bent the rules on this one because he moved across the country and didn't have a car. But ultimately the system still should have been intact. And I was like, look, you got a rent or you got an Uber. Are you going to do something else? And that's, that's what's happening now. Either he has to find a vehicle or he can Uber to and from work. And I don't know where he's at in that process right now, but that's, that's how it should have been and I should just stuck to it. Again, it's not saying it's a system for Augusta. There's a system for us internally, and that is like work trucks and things are used for work purposes only when you're on the clock. And if you're driving outside of work with the vehicle, that is not permitted. So this is my fault for doing that. I knew it. Chuck had already mentioned it to me. It was my bad. El Paso. Hey, Mike. The first quarter of the year, January through March, we were negative 2,700k. The second quarter, we profited 3,000. So year to date, we've profited 300. As far as profit sharing, do we give a percentage of the 3,000, even if we haven't really profited anything all year? For your frontline team members, I would do that off of the 3,000. I feel like frontline team members should get a percentage of the quarterly profit because that's really their effort goes into that quarter. Management should get an accumulative because their decisions in the winter really do affect what happens in spring, et cetera. And you want to make sure that that is taken into account as it becomes more profitable. And I know you're turning things around this you're really focusing on more spring cleanups, Abraham, or cleanups in general and focusing on that instead of mowing as much as it becomes more profitable. You'll want and you might already be doing this, you want to make sure you're taking taking a salary, even if that's just a weekly distributions before you consider things as profit. That being said, I would always look at quarterly profits for your frontline team members and then your managers are cumulative. That's just kind of how I've always seen it. Because the guy out in the field, if they started working for you three months ago, you know they deserve the quarterly profit like they put in the work. They aren't necessarily liable for the fact that six months ago it was a tough spring rush or someone manager didn't sell well, et cetera. So frontline team members, I would personally do it off the 3,000. If you're giving 10% away, we're talking about $300. And I know that's it's tough to do when you're not really seeing a lot of profits. And so that's why in part we're removing distributable cash. But more importantly for your frontline team members.

$300 is probably incentive enough for that one employee, two employees potentially to have some sort of incentive to show up and be on time, etc. That's really the goal of profit sharing.

Connor from Evansville Will Stripe have the same issues that Essay does for credit cards? I always get like a dozen card decline due to suspected fraud, not authorized required issuer or invalid card number, even though I may have used it the month before and there was no issue. You would think that Clear and owning Essay would give us steps to fix these issues, but I have no idea how to fix them. Just seems like we have to spend extra money having commands and reach out to these customers about their current information when half the time the customer uses the same card and there was no issue on their end. We definitely see less issues with Stripe.

But I would always recommend everyone checking their credit card processor because.

Things can still happen between the time it processes and it's pending to the time it actually gets completed. And you've got to make sure that it's communicating that back to the CRM effectively. So it's really unfortunate that they actually, like you said, they own it. They actually have the opportunity to probably make this the best experience ever because they have the both the processor and the CRM that could talk to each other. But the way the companies are run, they're ran very differently and so they don't really have a lot of very good integration. It's really, it works more still like an integration in comparison to like a cohesive native.

Communication back and forth. So.

Based on what we have seen though, stripe is better. Like obviously stripe processes hundreds times more than clear and they figured this out a lot better in terms of SaaS integrations like with CRMs. So we've seen it be better. But what's nice is because we own copilot, we can then start making things on our end to make it the talking better back and forth. So based on I've seen it's been better. But I would always check your credit card processing statement and like triple check it. This is from Anonymous. How is your trip overall? How do you feel you hit your goals? Do you feel this will help people outside of Augusta? What parts of the challenge are you going to use or implement to help us franchisees? Do you feel that? Well, there's a lot of questions. Let's go to this on top. How's your trip overall? I think it was a success.

Let's break this down. Media side. Pretty good. I think it was like, like a solid 8 out of 10. Do you feel you hit your goals? I would say 10 out of 10 in terms of hitting the goals of like what I was trying to accomplish. How do you feel this will help people out of Augusta? I think them realizing how hard it is and that it's not easy and I get labeled a lot because I make videos about starting a longer business that people think I'm trying to get everyone to start a longer business. So I wanted to prove it's very, very difficult. Regardless of how much money you have or experience, it's very, very hard.

And then how else will help you outside of Augusta? I would hope that even if they don't join Augusta, they realize that systems and procedures are extremely important. Having a back end like command center, a website, all these other things that like are assumed when I start, they need to do themselves. And either you join Augusta or you got it yourself. But like ultimately that's what allowed us the challenge to be successful. Do you feel that you would ever do this again in a different time frame, in a different way to make it better? Yes, we have some ideas and we're really looking forward to it and it's going to be very exciting. But it's not going to be about starting as much as different stages of growth. So we have. We have some really cool stuff we're going to do. I'm not saying anything about it because I've been instructed to do so.

Or would you consider having someone else do it in a different way to accomplish these different goals? Yeah, we have a lot. Some really cool stuff that I think is going to be even more beneficial. What I'm most excited about is the course that's coming out that has every single day I did behind the scenes, breaking down numbers, what I was actually thinking and doing that we should have up in July by the end of July that I can give new owners of Augusta. That was like, the main reason is I wanted a roadmap for the first 30 days for Gusta Lawn Care and not just like, hey, have your weekly check in with a coach. It's like, follow this. And if you do that, literally, you're going to have what I had at the end. And I'm pretty confident saying that simply due to the fact that, like, we did not spend a lot on marketing. We literally did door hangers and signs for about 80% of our leads. And so, you know, booked out four weeks. Having an employee getting started, having a general manager in place, all of that was done in one month. And there was no fabrication of that whatsoever in terms of for the media side. So I feel very, very confident about that. And seeing how much I doubted that, like, even week two and three.

Is. Is important to show on the media side. So that way when people get started, they don't have this unrealistic expectation of how easy it is. It's very, very difficult. But just like when we talk about momentum and we talk about get jobs at all costs in terms of don't worry about close ratio, I wanted to show that because no one believes me. And I see people spend two, three years sometimes figuring out the rhythm of what momentum really means. When it's like, look, just commit to this. I promise you this will work out. And whether it takes you a month or three years is going to be determining factor of whether or not you trust that I want your close ratio high regardless of the cost. And why you do that is because you need momentum. And once you get moment, then you can start charging the prices and increase them. Almost like by the end of the month, we were charging EVs and dump fees and booking ourselves into August. So.

So I would say overall, very successful. Obviously, I really need to get to this legal thing with the truck. It's gonna be a really learning experience for me. So hopefully it's helpful for all of you and that is like how to deal with like when you're at fault and employees at fault for an accident. But it could be very, very bad litigious wise. So we'll see. Let's see what's up. Connor from Evansville Question about collections. I believe your previous comment has been that you shouldn't require cards and file because abstraction.

I wouldn't say that. I would say. I would say that if your main objective in your business is growth at all costs. I would not require cards on file simply because you're okay with 2 or 3% bad like collect. Like not collecting simply because it opens up the door for faster growth and you can sell the jobs in person and like do all that sort of thing. Not great though because you're going to have 2, 3% of people will not pay and it's not good. However, with no longer taking calls since joining and CC doing over the phone, we can't really weed out the bad areas of town or the more likely to go to collections people with the phone call conversation. Totally fine. How do we reduce collections at the same time as not adding friction to the sales process? Great question. I know I've said this a few times but like and it sounds bad but it sounds like I'm pushing you off, but I'm not. COPA is going to have a button that allows you to require a card on file before they click accept and so.

You won't be able, they will not be able to accept the estimate without having a card on file. And by doing that it will allow you to either A all every single person basically to accept an asset must have a card on file or B if they accept a job over certain thresholds of value they also have to have a card and file.

So.

That'S really like ultimately like we had this is like parts of this for example we need to create inside copa. So that way instead of having like a very complicated system or automations around like making sure the cards on file then it sends it back to you and send you a notification if they haven't had a card in file it's within 24 hours of their service. Like you could definitely do all of that and you can, you could also have a thing that when they click accept it says boom. Put your car and file to. To lock in service. Like just make it as simple as possible for the, for the user and less manual double entry and like you going back and taking them off service or calling them and like you have to Have a car on file for us to service your property, like, all of that. And then, like, are you really going to, like, take them off the schedule? Yes, if you're like, in a growth in profit mode, but probably not. If you, like, have 10 customers, like, you're going to like, okay, let's just get them done and enroll.

Garrett from Glendale. If you lay off a team member in December, would you still give them Q4 profit sharing assuming they qualified, or only pay out profit sharing for teams that stay on through January? It depends what your quarterly profit or what your quarters are broken up to in if. In this case, if October, November and December are.

Are like the end, like your Q4, for example. For us, for example, it's not. It is December, January, February is Q4 for us. But let's assume that you're saying October, November, December, and you're laying them off mid December. I would give them profit sharing. And we've done that at the Bellingham shop quite often. And it's like, if they are, like a week or two away from being profit sharing and we're laying them off, we will still, on our last paycheck, give them profit sharing, assuming that we are laying them off due to, like, you know, there's less work. Garrett from Glenda. I'm assuming command center helping out with transition to copies only available growth models. Is this correct? No, it'll be for everybody. If you're trying to transition sooner than the cutoffs, it will not be. So, for example, like, by October 1st, when everyone's required, basically, we're not going to support Zooper anymore. We will make sure we have support transition videos. Everyone here will be trained up on it. And we're actually getting another support person just for Augusta for copilot. So hopefully next couple of weeks we all get them on board and trained by August, have them up and running. So that way, as Augusta people are inside of copilot, they'll literally be sitting here. So if command center has questions, they can walk over to them. And so.

No command center. Hope everyone's trying to send over.

And to like, keep in mind we're all paying copilot, so copilot will have to take the brunt of support too. So if there's technical questions, like can book a call with them, you can set up a zoom call, give them a phone call, like all of that stuff. So.

All right, I think that's all for today. Hope everyone has a great Monday. Make sure you submit your. If you would like to be on the franchise advisory council ballot, submit your name. If not, tomorrow, Wednesday. I will make sure I take those and then I'll create a ballot for which you will vote. Again, all. All locations can vote.

And general managers can vote if they are part of a location. So. But one person voting per location, please. So. All right. Hopefully, everyone have a fantastic Monday and we'll see you tomorrow. Take care.