Mike Minutes Mastermind 07/06/2022

Good morning, Augusta Nation. Hope you're doing super well. Let's go and get started. Just one announcement I had and that is within the next week or so, I will be sending out a form for everyone to fill out to nominate individuals or, sorry to ask yourself to be nominated, nominated for the Advisory Council, the franchise Advisory Council. So it'll be in two phases. The first one will be if you want to nominate yourself and then put yourself forward and then that would then go to a vote across the whole system. So you don't need to text me and tell me that you what you would like to be on the Advisory Council. It's not going to have anything to do with me. It's going to be completely based upon everyone's vote. So the first wave, like I said in this next week will be for you asking you if you would like to be on the ballot. And then the week after, potentially a few days later, is when I would send another vote. And that would be for the people who wanted to be on the ballot. You would vote who you wanted to be on there. So we will be sending that out here in the next few days and I'll put some more information there, how many people we're going to choose and all that good stuff. But texting me does not matter. I am one vote of many. All right. I will vote myself personally, but it will have no impact on the results of the ballot. All right, I think that's all I had for for announcements. Let's jump into questions.

I haven't looked at all these yet today, but let's pull these up. I think there's four or five of these. Cool. All right, first questions from Vlad. In growth mode, currently 90 of revenue is recurring work. Closing rate is all that matters. So I price jobs low to get traction. If I keep prices low, how can guys get performance dollars? Do you mean price jobs just enough to beat budget hours just below budget hours or at budget hours? Thank you, Mike. Yeah, so I always want budget hours to be accurate. I'd rather you reduce your hourly rate at the very worst than not be accurate on budgeted hours because the guys need to trust budget hours. So down the road, when you increase the rates, budget hours are still consistently accurate.

When you're chopping at price, the first thing you're going to look at is going to be dump fees, estimate fees. And then if you start immaterial markup those things because those do not affect their P4P. If you still need to bring price down, bring the rate down of the Budget hours. Don't skimp on budgeted hours. Okay? I always want budget hours to be accurate. The same thing goes when you're trying to boost profit and you're trying to increase profitability. We do not raise the rate of the hourly rate to the customer. We are going to beef up E fees, dump fees, more material markup, because those are things where profit is actually going to the company. So I always want budget hours to be as accurate as possible. The only time when we like beef up budgeted hours is when we are currently at the local shop. Like seven, eight weeks booked out and we don't even want the work just like throw budgeted hours at it. But typically we want budget hours to, to be as accurate as possible and that means bringing the rate down. Worst case scenario, then do that because you want the guys to have confidence in budgeted hours.

Okay, Long question. I assume this answer is likely because I am not screening calls, which is part of the growth and this is too complex. Just let me know. Okay? I have had three or four customers over the past couple months that have canceled because they had a broken leg or arm and they are now healed. In the past, I would not take on these vacation. Oh, one second, Let me make this a little bigger for all of you. One second. There you go.

In the past, I would not have taken these vacation or shirt termos as we would. We usually don't make any money on them or would charge extra to recoup costs. Do you know of a way that we can weed these people out? In my old brand, I would. I used to require customers to finish out the month billing cycle to prevent this. Just wondering how much complexity is too much and if I should just roll it, roll it over my shoulders. You can absolutely just say, look, we don't accept someone for one or two weeks or something like that. I'm just trying to not be vacation short term or anything. Yeah. So you could do it one or two ways. One, you can make note on their account that like, hey, this person tries because this is what we would have all the time. Once a year someone calls and they want us for like two weeks. And it's difficult because the pricing is already inside of service, inside of your CRM. Everything looks good to go. And they just like, hey, I want to get started. It's very difficult to weed those people out because like, oh great, let's go ahead and get you started. We got the pricing here, let's roll. What I would recommend is in the office notes put in there. If there's repeat offenders because there's usually like all of us have that quarter percent of people that do this. All right, you know who they are. I'd go into those four or five accounts and just make an office note. This person tries to occasionally get short term MO's and one or one or two MO's here and there. Please do not put them on the schedule because if we tell them that we don't do short term mows, they get smart and they say hey, I want to get on the schedule and then they just cancel a couple weeks later. So this is the downside of having per cut pricing. But literally we're talking about a very small fraction of people. So I would just recommend in all caps on their office notes, inside service autopilot inside their customer intelligence, inside of Zooper. I'd be interesting. All caps. This client asks for short term MO's and please do not service unless they are signing up for the whole year. Something like that is what I would recommend. I wouldn't make a whole system around this because it's just a such a small fragment of people that do this and that is they kind of like try to use the system in their favor. Nick from Marysville, could you explain more about CC reconciling our accounts for first half of year and preparing financial report? We didn't do this last year and I know it's mandatory now, so it's not mandatory. But if you're using quick, if command center is doing your QuickBooks for you, they will on a quarterly basis send you a balance sheet and a P and L. And they have reconciled everything now. They reconcile every single week. But, but typically at the end of the quarter there's going to be things like interest coming in and out, there's going to be loan payments that need to be reconciled on the balance sheet. And it's easier to do it every quarter than at the end of the year when you're like oh my word, what was that fifteen hundred dollar check I wrote myself in the middle of April. So usually middle of July is when you're going to get your Q2. So April, May, June, quarter. And I've always done this, it's very, very helpful. If you're ever trying to get debt, if you're ever trying to get a new bank loan, if you're trying to get credit line, they want the last quarters up to the last quarter's financial reports. And financial reports typically are just going to be your balance sheet and your profit and loss statement. So they'll get that to you here in the next couple weeks. They usually wait a week to reconcile because sometimes transactions will come through like the last of the month and stuff, especially with this past holiday. So it's not mandatory though, Nick, if you don't want them to do quarterly reports for you, just let them know. But honestly, if they've been doing your QuickBooks throughout the entire quarter, it doesn't take them super long and it's really helpful to just reconcile. Especially your balance sheet, your profit and loss statement. As long as your are categories and expenses is usually lined up, it's your balance sheet that needs to be reconciled because you know accounts receivable has to be balanced in there. What's on your credit card statements have to be balanced in there. That's what takes a little bit of time, the profit and loss. I mean as long as you've been organized and an organizing transaction that it doesn't take very long.

If you mark a client, do not mark an essay. They won't receive one click estimates correct. Oh man. I would like to say yes, but I have seen this not work. I don't know why, but we have, we have tried do not market and it still will not will go through. Part of the reason for that though is the category of email. So in Service Autopilot it asks for what category of email asks for like client marketing, automation, et cetera. I feel like the do not market one only applies to the marketing category emails. I haven't tested this in the past couple years, but I know a couple years ago that was the case. But what we've determined to do is if someone complains about their email like emails coming through, we just take their email out. Now you can't do this if they're an existing customer. But existing customers that get invoices every month typically don't complain about one click estimate emails. They just realize, hey, I'll get once a month or whenever I get a sales email. They're not too worried about it. It's the people who like have never done service with you. They don't like you for whatever reason or they did service with you and then they hate your guts. Those are the people that typically are asking for you not to contact them. And if I was you, I just take their email address out honestly. And then in order to do that, you're going to have to change their billing to print. Otherwise if it's an email, it'll require an email inside of their SA account.

What's your loss of efficiency using the residential 21 inch push motors compared to your usual 30 inch commercial ones. I would say there's a small loss of efficiency on large properties, but on the smaller properties it is a massive gain efficiency increase because they're so much lighter, they're so much faster to turn around. And I would say any property under 3,000 square feet of turf, it's faster to have the residential 21 push mowers because just lighter, they're faster to move around. They get them in and out of the trailers way faster. You just look at a crew when they're getting out 0 turns vs 30 inches vs 20 in mowers. How fast they can get out of a trailer is incredible. And so.

What I would say is if I had to quickly do the math, I'd say anything under 3,000 square feet per of turf in a lawn, it's the fastest to be a residential 21 push mower. Then if you start going 3,000 to 7, 8,000, 9,000 square feet, that's when a 30 inch push mower is going to have some efficiency enough for me to be caring about it. And then anything above like 10,000 square feet, you're going to need a zero turn. Like it's just if that's consistently where your property is at, you want a zero turn it, you know, we have properties where we're doing an acre with, with 21 inch push mowers, but there's where they're. The budget hours are based upon having a 21 inch push mower. The bottom line is you want your budget hours to always be based upon the smallest mower size that you have. So if you're using 21 push mowers, don't come to a 30,000 square foot property. Be like, oh, I'll use the zero turn on this property so I can do it in an hour. No, like think about if I have the 21. That's what you should be basing your budgeted hours on. Okay, all right, that's all I got for the day. Hope you all have a fantastic rest of your Wednesday and we'll see you tomorrow.