Mike Minutes Mastermind 07/29/2023

Hey, everyone. Hope it is you, too. Well, happy Saturday. I know I did on Saturdays, but I did not get to this yesterday in the airport. I've been in the airport now for almost seven hours.

Flight canceled or delayed. The other one canceled. It's been awesome. Super fantastic. Trying to get back home. So let's go and get this thing kicked off. I'll answer some questions and I think I want to say a couple things, so let me just.

Where's the Facebook group? Oh, man. Sorry. My quick key. All right. Destination.

Okay, while I'm doing this.

If you haven't already, definitely recommend. Oh, man, my foot. Spawn.

I'm sitting over here so that I'm not underneath the speakers where it's like, crazy loud. Okay, let's see here. Copy this, throw it in the playlist. Boom. Save that.

And then drop it in here. Okay. Back on track.

If you haven't, take a look at the post I made this morning on the Facebook group. I do believe that the vast majority of people.

Are overwhelmed in their business to do two things that would almost instantly solve their problems, and they don't because of fomo. Fear of missing out. And that is raise your prices by 25%. 20% is fine, too. And raise your wages, your base pay by 20%. By doing that, you will not affect the percentage of what P for P delta you have. Increase all of your prices by 20%, and you increase your base pay by 20%. And your guys are beating base pay by 15, 20%. That will still be maintained. Doing so will increase profits. It'll help you have more leverage when it comes to finding better employees. Like, how does it make any sense to pay my current employees more when I raise base pay? Here's why. Because now they're not walking away from a $15 per hour job. They're walking from a $20 per hour job. And that's more leverage that you have because you know now that when you put up a job ad, you get 10 applicants within a day instead of one or two. And that's leverage that you have. And so guess what they're going to do? They're going to show up to work on time. So.

Now the reason people don't do this, if we're all just going to be really honest, is because of fomo. Fear of missing out. Because when you do that, you're going to squash growth. Okay? So when you raise prices by 20%. Yes. Your close ratio will go down. You will lose some customers probably way less than you think.

Guaranteed less than you think.

And you will have a higher quality candidate.

And you will have more leverage for your existing team to ensure that they are more dependable.

The reason we don't do it, every single one of us, myself included, is because of fear of missing out on growth. That's just the bottom line. Let me just make sure my audio is correct.

You know, we're like, man the lead. I know it's painful. I know it's painful when you know and we try to block for this command center, that's like you don't see estimate request forms or you don't get the phone calls when you turn off leads or when.

You know you cut out certain services, you don't even get those. Because the same thing with cutting out services or cutting out a service area, making your area more dense is like the reason people don't do it is because of fear of missing out. Every location I have ever raised prices on or cut services out, or cut my service area down, or regretted those decisions doing the opposite of those three things, I have always had regrets. But yet the reason we don't, including myself, would not ever do this is because if you're missing out now, should everyone do this? No, because I'm talking about doesn't mean to everybody. If you're in growth mode, if you're trying to grow your business, this is not the time to do it. You're going to slam on the brakes of growth if you do this. But if you are at the point of, you know, breaking point and you're considering giving up, you're considering not throwing a towel, that is absolutely the break glass strategy. And that is raise prices. That will slow down growth, you will lose some customers.

And increase your base pay the same percentage. Which means if you are paying, if your average cut is $40 and you increase prices by $10, that's a 25% increase. Which means if you're paying $16 per hour, you can now afford to pay about 21 or $22 per hour on base pay and still have that delta between base pay and P2P. Okay?

And as much as I love the max metrics, I have consistently seen that we have a very, a lot of very competitive people inside of a destination. And it's causing people to bad business decisions because they just want to see their number on the top. No one cares. All right? And I, I understand that people are competitive and can push you to be able to achieve more. But don't let that come at the expense in your business because ultimately the business goes to Zero. Because you have to quit. You aren't getting the top of any max metrics or any award or anything like that.

I had this little fun exercise that I did last night.

I went through about 20 of the most popular business.

Influencers that everyone here would know. Almost every single one, probably everyone here listening to this would know every single time out the background noise. We know every single name. I did a little research in all of them. The average amount of time that it took from them starting to be having traces of, of success, the average was over 12 years.

And the problem is they started making content usually around year 15. Okay. Which means.

That all of us that are watching and like, man, I've been grinding for just, I'm watch, I'm listening, I'm trying to improve and trying to better myself. And we started our business a year, two years, three years ago. Like, I've been doing this for 10 years almost now. I have so much to learn and so much I don't know about lawn care about this industry, about the future of this industry, how every market works, how marketing works.

And the problem that I find is because they started making content after they were successful, we somehow believe that following what they're gonna, what they say, which is all very good, to improve yourself is somehow going to fast track us to going from like 12 years to 12 months. And that's not how it works. The laws of economics don't work that way because you have to have a profit margin and the profit margin is invested back into the business unless you have a huge amount of upfront capital. And no one in Augusta came into Augusta with like thousands of dollars and like 500, $600,000 to just spend and immediately get a location to a million, 2 million, 3 million in the first year. Not a single person has ever joined Augusta yet that has done that. All right? And so if you don't have that, you're going to have to realize that it will take the compounding effect of multiple years. Not only from a profitability standpoint, if you're very invested into growth, but also from a lack of understanding. It has taken me 10 years to understand what I know now. I don't think you're going to somehow unlock that within a couple weeks, months or years. It's just not going to happen. You can fast track it. And that's the whole positive part about listening to audible, audible programs, audiobooks, interviews, YouTube videos, if you hope to fast track it. But the laws of economics and the laws of gravity that comes with success is that Time is a part of the recipe. It's like trying to bake a loaf of bread. It's like, I don't care how good your recipe is, I don't care how good your ingredients are, I don't care how great your oven is. If you don't let the, the, the dough rise and you try to rush that process, it will flop. It won't be good. And so what I'm finding is people inside of a gustination and this is not just an agustination, but it's a universal problem that I faced and I'm recognizing more and more is we have the good ingredients. I got P for P. I do profit sharing, I treat my guys good, I'm doing my pricing exactly right. I'm inside the systems. And the only thing that is, is coming into question. The only problem is they have not allowed the dough to rise. They have not allowed the fact that they have to learn over the course of several years when's the best time to hire in their market, when does the grass grow the fastest, when not to schedule projects so that the natural cadence and demand of mowing is, isn't going to massively impact their, their, their psychological well being and overload their employees.

These are the type of things that just take time. And.

I just wish.

I just wish that.

We could somehow see what these people we all look up to were doing 15, 20 years before they started making content. When they all questioned whether they should continue, they all questioned when they should switch industries. When they all questioned whether or not they could make payroll. When they all questioned whether or not it was worth it, whether they should go do something else that looked better, that looked like it had better profit margins, like so anyways. All right, we are going to move on.

All right, let me share my screen.

Okay. I looked at the questions, that's why I'll see if we have it here. All right. Kyle Tarvin. I've been talking with Kyle Turner. With the turnaround you are doing in his location, it seems like you're raising prices pretty drastically. What are you coming up coming up with? What are you coming up with? Which customers get the different levels of price increase? 5, 8, Etc. We raised our prices $5 across the board. But are there factors that play into larger increases? The larger the increase is going to determine.

How backed up are you basically? And how much more do you raise raise base pay. So for example, if I could do it all over again, I could rewind the tape about 48 hours, I would have raised the prices more at Madison because we raised prices $7 weekly and $12 biweekly for anyone that was $40 per week or below. Okay. Anyone that was above $40 per week, we were raising $10 per weekly and $15 for bi weekly. Okay.

That leads to a lot of extra revenue. Here's the problem. It has been they completed, they worked on the command center on Thursday, Friday, and they finished the day the price increases so far three people. The report I got today was three people so far have canceled and that is both by phone and email. Will there be more? Yes, I do believe there will be more cancellations. When it comes to price, when it comes to invoicing at the end of July, I do believe that. And will they see the extra benefit of that profit right away? No, they won't see it until the end of July or end of August when they bill for the first time. And will there be more customers that cancel in? Probably. So let's just say that five times many people cancel then as in the past few days, which I don't think it's me that much. That would mean that 20 people out of more than 200, because they had 300 customers, they already raised price about 40 of them. We raised prices on somewhere between 200 and 250 customers. Let's assume 10% cancel. I would, I, if I would have known that number, I would have been more liberal with increasing the prices. I would have done 10 and 15 on the, on the below 40 and would have probably done like probably 14 and 21 on the biweekly people. Like, the reason is because I want to raise the base pay significantly. I need to in order to be able to get applicants that want to come work and retain leverage against my current team that will not be able to go get that same base pay and another job. So in hindsight, I wish I would have raised the prices more. And.

Yeah, you, you guys will see in the video, like I, I told, I told Kyle Turner, like any new customer coming in, their price better be through the roof because right now, like they're working crazy amounts of hours, et cetera. So, you know, you guys will see the video. It'll be good. Denver how do you get a US Passport in can? The easy way. There is no easy way to get a US passport, even if you're Canadian. Actually, the easiest way is probably getting married as a citizen. Kyle Tarvin more coma. I was talking with Kyle Turner the weekend regarding our hiring. To ensure you have employees to cover your budget hours allocated for the week, I asked a While back and you mentioned we needed to let go one of our employees to get us to profitability. Since we had 3 employees plus myself, we currently are doing 30k revenue, 2 employees and myself on 2 trucks. How am I supposed to over hire to make sure that the business doesn't suffer if someone leaves while ensuring location is profit? Okay, this is a great question. Give me 10 seconds. I'm a grandma. Remarkable.

All right, let's draw.

This is a good question. Okay, I know when you're in, it can seem like a rocket science. Let me explain. All right, so look at this guy working hard. He's killer. This is first trip, Terrell. Christian. Okay, so how should I draw this? This is what I. How I kind of think about it. Transfer. Oh, I can't look at that. Okay, cool. All right, so we have zero.

And let's do. Let's do.

180 budgeted hours. And this is zero budget hours. Okay. This would be 90 budgeted hours. 30, 60, 120, 150. Okay.

Look at that. Gorgeous. Okay.

Now if I had 180 budget hours, I would need six employees, assuming I'm doing 30 budget hours per employee per week. Okay, so there's 180 budget hours per week. In the perfect scenario, I would have six employees, right? Cool. Now what if I don't have six employees? Someone leaves. Now you have five employees. So what is it going to be? It's going to be 35 budget hours per person to get these jobs done, right? 36. So everyone's working overtime probably. Okay, now what happens if you get seven employees? Because the difference is like, we need six, right? We need six.

We need six. But if I have five, they are all working a little overtime. If I have. If I have.

Seven now, they're going to all work about 27 budget hours a week. Okay, now why I'm saying this is because at any given budget hour amount that you have, you have some flex. Because not everyone has to work exactly 40 hours a week. Okay? You can probably get away with having a range of 30. This is clocked hours. So clocked hours.

Not budget hours. You can have 30 to probably 45, depending on your culture and timing, that you can have this range of clock hours in a week for your employees, 30 to 45, which means you have quite a bit of wiggle room. What that means is if you're trying to max out your guys and they're all working 44, 45, 46 hours a week, probably a good time to hire someone, you're like, well, if I do that, man, we're not gonna have enough work. It's probably gonna bring everyone down to. If you have less employees, it's a bigger impact, right? So if you have three employees, it makes a bigger impact when you all of a sudden hire another person. But what you want to do is schedule it in a way where you're ramping up to, okay, they're working 42, 44, 46 hours. Everyone's kind of getting burnt out. Okay? Hire someone. Well, now it's like 32, right? Because if you don't have any employees and affect this way more, but you have literally 50%. You have 50% of wiggle room. You can increase your clocked hours of your team by 30% or 50% from 30 to 45, worst case scenario, okay? And still probably keep them, like, just fine. Like anything above 45 budget or hours clocked a week, you start to burn people out, typically. And anything under 30, you typically like, hey, I need more hours, boss. I gotta work somewhere else. You have quite a bit of room. So what I would recommend is, okay, let's just throw a number. Let's say you are doing 100 budget hours a week, okay? 100 budget hours, okay? We're 100 budget hours on the scale, right? So there's several ways you can cut this up, right? You could have four employees. Maybe that's you and three employees. You and three employees. And if you did that, you'd all be working 25 budget hours each week, probably only working 34 to 36 hours clocked low knocking. No one's gonna be complaining. You don't have to work weekends, no overtime. Okay? Now someone, you leave, lose someone. Now all of a sudden, everyone's working 33 budget hours, okay? Now you're gonna probably go from working 34, 36 hours a week, terms of clock hours, to 30 to 43, 44, 45, right? So what you want to do is push them to this side of things and then hire someone and then bring it back. Then, okay, now we're back here. And then grow, grow, grow. If you're adding, assuming you're growing and you're adding budget hours, now I hire again.

And you'd rather them be closer to this side because you retain.

The.

You'd rather them be closer to over here, like working. You'd rather have one too many employees and then working a few hours less than, like, 33, 34 hours, you'd rather have that. Because in that scenario, you're at less risk when someone leaves because you. If someone leaves now, it's like, okay, I know I have enough flex to be able to just.