Mike Minutes Mastermind 07/26/2023

Hey everyone, I hope you're doing very well. Let's go and get started.

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Cool. Look at some questions. I'm going to jump right into those.

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I want brand new questions.

Right. Irwin from Tracy, Regional Manager. When do I start purchasing more equipment? Do I wait until a certain amount of money is in the account? It really comes down to your rate of growth. And if you're maxing out, maxing out your current capacity in terms of equipment, you should be buying equipment. When you are maxing your usage of those particular day, the trucks are full employees. Until that point, you should be focusing on maximizing the efficiency of the routes, scheduling things correctly to make sure you're using the truck equipment every single day, all day long. And then once that point is hit, then it's a matter of how long do you need to wait until you have enough cash on hand to be able to go out and make the purchases. And if it means waiting for a while just to let the cash balance come back up, that's completely normal and acceptable. Nick from Marysville Long question. The details help paint a more clear picture. All right. What would you do in this situation? Client that we did a full cleanup for in March and then put them on weekly regular bed maintenance and mowing calls about their property being infested with weeds. There are more details, but I'll get to the point. Her garden beds that are perfectly mulched after our cleanup now have 2 foot tall weeds throughout the property. He had a knee surgery and couldn't get around the property scene until now. And that's how it went on for so long anyway. The guys did not mention any of this. Matt hadn't been there in a month, give or take. And two guys had been regular at that property for the last month. Before that we had other guys that no longer work here. I'm paying out close to 1700 in PvP between those two guys for the last pay period. $1000 to one guy and $700 to the other. We are going to have to refund her for bed maintenance services for the last couple months as well as 16 budget hours to clean up the property for free. Would you take all their bonuses for one property? I want to become.

I want to.

Because we are going to lose hundreds as well as having two guys spend all day cleaning up over $700 refunds and opportunity costs. But it's not like it's one single mistake. One of these guys already put in his two notice last week and the other guy would probably walk out if I told him I'm taking all the bonus.

So.

Sorry, this is long. Sorry, this is a long. Just want to know your perspective. What would taking all the bonus be too radical. So knowing your case, Nick, where like it's not like you over, you know, you're not overbooked to your guys right now. I would probably have a team meeting like, hey guys, can we all like a team yellow slip? I would personally not refund her previous visits.

If you're going back and doing things.

For free, I would not refund those. I'd be like, hey, we will come back and we will make this right and we will clean things up and get it up to where they should be. I'm not going to refund the last couple months because you probably only have gotten a couple hundred dollars in, in revenue in the past couple months of trimming or of weeding.

Let me change my mic.

There we go. Check one, two. All right.

So I would not, I personally wouldn't refund them. I would especially because she wants you to keep still doing service. I would just go back and fix it. What I would personally do is have a team meeting probably and be like, especially because you don't have a ton of work. Okay guys, this is a team yellow slip. We messed up. And don't put it on the guys because honestly, this is not probably even their fault. If they see two foot tall weeds and it says weed every single week, they assume that those areas not included. I just be like, hey, this is what's happening. We're going to do this for free. Make this customer happy. We're all going to do it on this day and we're all going to knock it out at the end of the day. That might be a three hours then for everyone. Like a half day for the whole crew. Just knock everything out together. Maybe you get pizza for the guys on that day at the job site and you guys just knock it out. That would be my recommendation. I would just schedule it into everyone's schedule and then tell them the morning of like the more say let's say Thursday morning you have a meeting and it's like, hey guys, on your route today, this is what happened. We're all going to do our mowing and stuff and then at, you know, 2 o' clock or 1 o' clock we're going to go knock this out together. I know it's a pain in the butt and I know half of it probably isn't our fault. Those you Standing here. However, it's a team yellow slip. We're doing this for free to knock us out for the customer. I'll make sure we get pizza for the whole team. I would take that direction because if you put it all on these guys, they're going to feel it's unfair and it kind of is because for the vast majority of them, if they're new, it's not even their fault. And if they're seeing two foot weeds and it says weekly weeding, I'm going to assume those areas are not included. So I would try to, I would not take away people's bonuses. I would try to make this as like, hey, like let's just go knock this out together. Take it as a team. I personally, as the owner, would get on the job site with them for those few hours and just knock it out. I, I truly would think if you get all five or six guys, you would knock this out in a matter of a couple hours, get some pizza for them and just do it that way. It's not worth losing a good team member or two over because you mishandle it. And it's not their fault because again, they're gonna be like, I've never even been to that property and like that's just not fair. So I would just take it on the chin that way. I would not refund the customer unless you've already promised that. Delta. Andrew. Mike, We've run into an issue a few times where we quote on a treatment and the customer doesn't realize that they need to click on the treatment tab in SA to view the list of treatments and prices. They see the line on it says $0 and they think that any treatment we talk about during the quote is included along with the other work and refuse to pay for treatments. Whenever I do the quote myself, I put a total for the pricing. Treatment pricing. I know commands are going to leave it blank, which I think sometimes confuses the customers. Do you think, do you run into problems with other locations? Is this something we can request for command center, change our location? It's not something you can change a command center because it's part of the system. Anytime that you're offering multiple prices inside of that service, like then it's always going to be that. However, what you could do if you wanted to always have that, you could change it in the items and in the service itself where it changes the price. But if you have multiple prices listed in the description, that's our telltale sign that that pricing needs to be zero. So you could, you could talk to command center, you know, send an email to help Gustalongo services.com see if that's something that you could do. And I was like change it to be one price and then just have one price in the description. But.

I, I just, we don't see this happen very often. It, people see, they like if they don't read in the description, that's a problem too. Like they don't know your frequency, they don't know what you're putting down, anything like that. So it should be pretty clear. And it might just be a matter of like bo.

The pricing and like what you're actually going to do in terms of the services in the description. But I think this is more of a formatting issue just to make sure that the pricing and what services, when you're doing them in terms of treatments are going to be completed. That would be the way I would take this.

And if you, because as soon as you put a dollar amount in there, they see a total at the bottom, right? So let's say there's a, you know, they're, they're what now what's going to happen is they're going to say a mowing, they're going to mulching and they're going to have fertilization. They're going to see the bottom like oh, I got all of the stuff for a thousand dollars. They click Accept, time goes on and all of a sudden you're billing them for other services like oh, I thought all of those things were included for the whole year. So if they're not reading the description and they're clicking accept, it's almost worse if they click accept to one price because now they're going to, if they're not reading the left hand side they're still going to assume that includes all of that stuff. So I would rather have a zero and have to work through that misunderstanding then have a one treatment price in there and work through that misunderstanding. Then it's like well then why don't we put the whole package price of the whole year? Well now you're inflating that subtotal and they might not accept your entire estimate because that number looks really big. So.

It'S not perfect. And in copilot down the road we have a few ideas of how to make this way easier in terms of, for packages and things like that and seeing the prices as sub, like sub parts of it and seeing the actual dollar amounts of each, etc. But I would, I would recommend just focus on your formatting in the description to make it more apparent that the pricing is per service and it is not $0 and is not included in the mowing service, etc. So feel free to email help@augustalongerservices.com they can walk you through that and see if you do want a price in the far right how that potentially could work. What's likely going to be though is you're going to have to make sure that every single treatment is the exact same cost and you're going to change the way it's formatted just so that way command center doesn't think oh multiple services and prices. Therefore I have to change this to zero. Tyler Kukle how would you have additional citizenships, change taxation for the profits of American companies or lower the cost structure of the businesses? How would that affect the effect of tyrannical mandates to shut down businesses like COVID 19 great question. So in terms of if you have if you are still a citizen of the us so there is taxation by citizenship when it comes to America, Australia and other several other countries. Which means if you are a citizen regardless of where you move in the country, in the world, regardless of how you set up your business structures, you will be taxed as an American citizen, for example. There's a few things though. If you live outside the us.

There.

Are certain savings you can have around other types of for example like state tax, you wouldn't have state tax. You can lean more on the corporate tax structure instead of everything being taxed to your personal. However, the vast majority of your tax savings if you're going offshore come in the form of giving up your citizenship in order to be able to have the businesses actually ran from a different country.

So for example, like in Puerto rico, you have 0% personal tax income personal tax rate, but you have to meet certain requirements. You have to buy a house within the first two years of being there. You can't come to the US for a certain amount of days. So every single country has a different requirement. Most countries the US allows up to 90 days on a visa so that you could still come to the US for 90 days, manage whatever assets you have, manage other businesses, et cetera. However, you're going to be doing that now as a foreign entity if you give up citizenship, which then means you can still do that, but you're going to be taxed differently in terms of like the corporate tax rate and because you're like a foreign entity and the IRS doesn't like it, but people do it and that is you're a citizen of a different country, you want to do business in America and then you get taxed on your corporate tax rate, then that money goes back to the other country where you get taxed on your personal income. But if you're going to remain a citizen of the US you will get taxed as as us and in perpetuity, where regardless of where you make income in the world. So there's some loopholes with Puerto Rico because territory of the United States.

So yeah, it's just interesting. I was learning a lot about it. Devin from Red Deer, Mike Andes, how how we Getting ready to 10 million? There's 25,000 single family homes. Numbers don't lie. 10% penetration, 2500 times 2000. 5 million. What else?

@ that point you'd have to raise your annual value above 2,000. And if you're trying to get 10 million, you have to get to 4,000 or you'd have to double the number of house, you know, customers you're serving. So it is just literally those two numbers that you'd be working with in terms of determining that top line revenue amount.

Connor Hutchinsville, Huntersville can you explain a little bit more about what you are looking to do with having passports and possibly banking other countries? I get that people do it to avoid taxes, but don't truly understand since there are already states with no income taxes. So first off, when it says there's states with no income tax, that's that's state tax, right? So I'm already in a state like Washington has no state income tax. However, my federal tax rate's over 30%.

And furthermore, in terms of why people do it. So let me address why people do it, because it's not necessarily all the reasons why I do it or what I would ever think of doing or am learning about it. And the reason people do it is it is annoying to live every single transaction of your life the lens of what's the tax implications of this and doing things in the business that technically aren't right for the business, but you're doing it for the sake of taxes. And so the question is if that if you didn't have to make every business decision through the lens of what's this going to do to my taxes, would you make different business decisions and would those different business decisions lead to a much greater outcome for the company because you'd invest more into the business than into figuring out how your tax situation is going to happen? Right? So like, there's a reason why there's tax incentives for things like low income housing. Their appreciation is lower. So do I really, am I really going, do I want to change my investment theses and investment vehicles simply because of the tax reasons or do I just simply want to focus on making better business decisions? Like every time there's a tax incentive it means that it's something the government wants you to do. And every time it's something the government wants to do, it means that in the free market it wouldn't happen. Right. So you're making a trade off by getting a tax reduction. I don't know much about capital gains taxes, but I could see when you sell a business or realize these gains being in the Caribbean could save you millions. But as far as income, why not just move to the headquarters of Texas or Tennessee? Yeah, because there's still federal income tax, right? I don't pay any state income tax. A lot of states already don't have income tax. It's just the.

The, the federal taxes. And you know, right now it's very popular in the United States to just say tax the rich. And what's going to happen is people are going to move out. When you threaten like what happened this past year, which you probably heard it in the news a little bit doubling of the, of the capital gains tax that would have cost, cost me over 300 grand last year. And so things like that, when that starts getting floated through and that 300,000 is what is paying for command center to be built. And so the, the bottom line is like the, the way that the, the political system is going is like let's just take everything we possibly can from people who make money. And that is super popular politically. And so that's why it's so popular when it makes actually no economical sense because anyone with that kind of funding and resources can move. They have options. And that's what you're seeing more and more of. And so. Yeah, let's keep reading. Also, would this require to stay in whatever country you choose from? X number of days per year? That seems to be a massive roadblock. Unless the entire move team moved there.

It just depends. Right? So if you have more brick and mortar, like the gym obviously can't move, my locations can't move. And I'm just using myself as an example. Don't think I'm actually doing any of this. I've taken no steps. I'm educating myself though a lot on this at least to be able to share with other people and be educated about it. And just like my personal Deep dive of education.

But anything that's virtual. So for example, like the media team, all of that is mostly virtual.

The software, P4P Copilot, all virtual.

The franchise in terms of how we collect virtual, right. I don't need to transact with a credit card to collect from customers. So there's a lot of that is already virtual and is already. I use a lot of contractors for web design and all sorts of stuff. And so it makes it a little bit easier. So if someone has like brick and mortar assets in the US it makes it much, much more difficult to do. And most people, if they're actually going to give up their citizenship, would get rid of a lot of those assets because it just becomes more complicated from a tax perspective. But yeah, most, most places like you can still go back in the US between for 90 days. So then it's a matter of like, hey, well can in 90 days, if you did, you know, that's three months. So that's one out of every four days. So it's like, okay, could you come to the US For a week, a month? Could you come to the week for a month? A week, every two months and get everything done, Family, whatever, that's the kind of thing that you're thinking about. And then, then the question is, do you take the 30, 40% the government's taking away from you and deploy that into the business? What, just the federal income taxes. I could theoretically quadruple how much I spend on my personal life like that. That's very weird. And so I just think that mostly when I look 10 years in the future, I ask myself, will I be paying a higher for us all to have free money? Is it to tax the rich? Here's the big headline. They're leaving. They have options and they will figure things out. And they have attorneys and they have accountants to figure this stuff out. And that's why everyone's crying about billionaires that don't pay any taxes. You guys make it so difficult and painful to be here in the US From a, from a tax perspective, they're going to find options and they have the resources to do so. And honestly, it sounds horrible, but you make a really litigious society and you make it a society like the US that has so much tax structure, you are basically making it. This is a, a place that people with a lot of accountants and a lot of lawyers can make anything happen. So additionally, how would you be doing this, any of this, in a situation like Covid, when the government's threatening to find you as a gym owner, regardless of your syndrome status, the gym is still up. Because a lot of what they're threatening me is based upon the power they have over me. And the power they have over me is that I have U.S. bank accounts that they were threatening to seize as well as take me to jail that they can't do if I'm a citizen from another country. So, for example, people that had multiple passports, they just took their passport. Okay, I'm going to move over to a different country that had the best situation when it came to Covid. And I know for a lot of you, like, lived in certain states, Covid was not a big deal. Like Washington state shut down. Like, it was like you couldn't. You couldn't eat for, like, at a restaurant for like 912 months, let alone do it without a mask. That was like a year and a half or two years. And so.

When people that had options, they had the freedom to be like, okay, great, I'm just gonna go live in this other country for a couple. Even if they're citizens in the U.S. still. Right. So, like, the thing is that you look at it, it's not just about taxes. That's one part of it. But it's more about having options and the power. Because if they would have told me, like, hey, we're going to take you take, you know, seize your assets because you're doing this, it's like, great, I'm going to move my money into a different bank account overseas. Good.

Luck.

Right. So there are other banking systems, there are other currencies. Not everything revolves around the SWIFT system. So it's just, it's just a way of like the, the, the amount of disempowerment I feel as an employer when I have to tell my employees I have to lay them off, not because I want to, not because business is bad, but because the government's forcing me to is just. It makes, it makes me feel weird.

Would just love to hear more of your findings on the benefits high net with owners can get from operating outside the U.S. yeah. So it's not for everyone, I don't think. I think for 99 of people, they shouldn't do it. It's just one of those things I feel like I should educate myself on, and I, for the very least, should have options. In the event that I feel like we go through another tyrannical time like we did in 2020, or we have a crazy tax thing that gets handed down, I would always move and I'll be like, peace out I want to have the option to do that. So it's not about enacting your. Your. Your right to do that. You're acting your option. It's a matter of having the option, which gives you freedom to think about possibilities because you're not limited by the possibility of being shut down or having extraneous forces hurt you.

Copy that, Mike. Glad I asked. I like your approach more. Okay, great. I'm changing up my schedule to losing an employee. I go. I will go from mowing Monday, Wednesday, and Friday to mowing Monday through Thursday and projects on Friday. If projects run over, I can complete on Saturday. Does this seem like a good idea? I need to spread more mowing out because I can't get it all complete in three days. This is the way to do it. If you are, like, really behind is have it where you're going through the. The one task and then complete. Like you're switching one time. You're going from mowing to the landscaping. When you have less than 8, 10 budget hours of mowing a day, it's usually better to split it up. It's better for the customer to be able to get to their property faster. But when you're way behind, it is better to be like, okay, I'm gonna mow all week long. Because you're more efficient. You're not switching tasks. So we can get extra one or two jobs at the end of each day and then switch to, well, Thursday, Friday, or Friday, Saturday doing the projects. That's a good move.

All right, everyone, have a fantastic day. I got a surprise for everyone tomorrow. It's going to be great. We'll see you tomorrow morning or tomorrow. Yeah, Take care.