Mike Minutes Mastermind 08/23/2023

Ladies and gentlemen, boys and girls, welcome to another edition of the Mike Minute Mastermind. Let's jump in this set up real quick.

Did I get the right one? All right, here we go. All right, Mike minutes. Boom. Save copy, save Facebook refresh. All right, couple quick announcements.

For. I dropped this link in here.

One.

September 18th. That is in approximately three weeks. This is a notice for if you are QuickBooks, Payroll, etc. We are bringing everything in house at Command Center. We've been working in the past year, year and a half to get the department completely trained up as QuickBooks Certified Pro users, etc. And that way we were able to move away from Lisa. Nothing against Lisa. Lisa's gonna be working home service epa. Totally different business as far as I'm concerned. The bottom line is Command center is much faster at reacting to payroll issues that arise when we can do it all in house. So in just deadlines, et cetera, we have way more control over it. So really the last part we've ever kind of outsourced and it's mostly just been a matter of habit and we got to train people. So it's an expensive process to train up the QuickBooks department. A couple of them are actually this winter going to be getting some degrees and certifications from the college in QuickBooks and accounting. So really just solidifying that department. It's probably the most complex department at command center in terms of knowing all the states and child support stuff and LNI and workers comp and all the rest of it. So a lot of. Lot of training happening. So. But as of September 18, that that transition should be completed and we are moving everything away from leave it to Lisa and over to Command Center. The vast majority has been. Excuse me, done by command center, probably 90% of it. It's like that last 10% that we've. Sorry.

That last 10% that we're going to be making sure we take back in house completely. And like I said, there's nothing, you know, against Lisa or anything. She's gonna be working at home service EPA still, but it'll be just much faster deadlines and timelines for when things happen in Command Center. It's just so much better if an issue happens. We can walk over the payroll department and figure it out completely and not have any sort of delay for you. That's been somewhat Delays with the QuickBooks and Payroll departments in the past is the fact that we are waiting on someone outside a command center, which slows us down.

Speaking of slowdowns, I know there has been Some intermittent issues with service autopilot. I know the Canadians had a really rough time last week. And then we've had some issues. Some accounts like email links not working, etc. We don't necessarily know why. Just know that I am doing my best to try to get better support. So over. Over the past week, two weeks, I've had multiple calls kind of going up the chain of command until finally I'm at. Scott Howard, who has been with servers all plat for like 13 years. Had a meeting with him just before this call. And so I'll be able to have a contact. More importantly, command center will have a contact that if something is going wrong, we can reach directly to him. I have his personal number and he's given that to us for command center managers to be able to reach out to him if needs be.

He doesn't necessarily technically have the technical side, so he does not gonna have answers on that side. But he will be able to at least give us some support at command center and know what he's talking about. Because our biggest challenge has always been when we. When we call into support at copilot or at service autopilot. A lot of times they're just making a ticket and then we hope to hear back from them in three to five days. So again, down the road, when we have copilot, what's nice is we have internal support. Literally we have a command center rep walk over to copilot, which is right over there. So. So the support will be faster. That loop, there's always going to be problems. Any software. But how quickly we can deal with them is what I'm very much interested in. And why we should be taking things in house and integrating it vertically instead of horizontally. I think that's all I got. Cool. All right. Now I'm looking forward today because someone actually emailed me and said hey. I submitted an anonymous.

Form and so they notified me of that. So I'm always looking forward to anonymous ones. Oh, the masked franchisee. Okay, let's see.

Let'S see here. Share.

Okay, this is it. The mass franchisee. Okay, it's pretty long.

Hi, Mike. I'm sorry to share this with. I am sorry to share this with you and Augusta nation. I don't want to be a failure or look down upon. I always remind myself to keep higher lows and lower highs. I am mentally exhausted. I am tired of complaints from customers of poor quality work. I let go two of my weakest employees and raise base pay by $2. No matter how much I tell my team and show them they continue to do poor quality work. I know it's hot and physical work. I'm tired of the stress and worry of not having enough for payroll each month. We raised prices recently, but with the added payroll costs now, I don't think I still have any more money in the bank at the end of the month. I am working long hours each day and seven days a week. I know being an entrepreneur isn't easy. I know I need to put in the time and sweat for at least three years, but this is exhausting. I work and I feel like I do not see the benefits of what I'm working towards. I. I'm not saying Augusta is not worth it, nor is lawn care. I am. I'm. I just am tired of hearing complaints and not having enough for payroll. I do not want to let you or Augusta Nation down. What should I do? Okay, so just. Just for context, I do know who this is, so I'm going to respond to this knowing that information, but they wanted to keep themselves anonymous, and that's totally fine. That's why we have the ability to do so on this form.

So.

What I would say first is ask yourself if, when you started your business a year, two years ago, whatever it is, if you would fast forward, if you would have told yourself back then that you'd be at where you are now in terms of just revenue and number of employees, you probably wouldn't have believed yourself. Okay?

And so keep that for a second. Then ask yourself this. What would solve both of these problems? Okay.

And I'll be perfectly honest. What is sol. What would solve those problems is capital. Right? So you're like, well, how do I get more capital?

Reduce the size of the business, but dramatically increase the profits. Because let's just say. Let's just say you did 25, say, $30,000 a month in revenue last year or last month? Okay.

When you started a year, two years ago, would you have believed me if I would have said you'd be doing that much in revenue? Or would you have been okay with, say, 24, $25,000 in revenue monthly?

And if the answer to that is like, well, yeah, I'd be, I would have been okay with, you know, 20, 30% less revenue. The answer is, raise your prices dramatically. Because right now, the issues that you're having with your employees are being.

Accentuated and magnified by the fact that you're having pressure financially. And so financial pressure always creates a lot of headache and then magnifies the problems you're having the business and like hand up. I know what that feels like. I constantly am going through that and I understand that pressure very acutely. And if you're like myself, like I posted the other day, like overthinks things so much, like, I can tell you how much everything costs, like very much.

Attuned to what things cost.

It is mentally fatiguing when you have that plus employee, team, customer issues.

If you were able to take the financial pressure off, you would probably do a better job of training the team members that you do have, ensuring that they then therefore do a higher quality work and don't have as many problems.

Instead of you working seven days a week just to get the jobs done because you're struggling financially and you need, you know, that's what is required to make make financial sense. So I would, I would say is you do not need to grow. You want to reduce the size of your business by 30%.

By literally raising your prices dramatically, like huge. All right. I don't know how many mowing customers you have. I would assume based upon what I've seen From afar, probably 100, 100 to 150 at least. I want that cut by 20 to 30%. I want it to be where you and one other person can now do the work. But you're going to make 75 to 80% of the revenue you currently are making because you're going to raise prices that high immediately. You will, you will solve the profit problem and you will now have eyes on that one employee and you'll be able to refind your footing and take this year and stop burning yourself out. You're going to lose 20, 30% of your customers by raising your prices 40 or 50%.

You're going to, by doing that though, you're going to make way more profit with five days of work a week instead of seven. You're also going to have less stress because now you have eyes on that one person that you're working with all day long. You're gonna be able to do that the rest this year and you're gonna come back much stronger next spring and have the confidence to go hire someone. Because now you know, financially they're gonna make more on P4P so they're gonna be more incentivized. There's gonna be more meat on the bone in terms of yellow slips as well as.

As you scale now. You're doing so very profitably. Instead of every time you get a new job, you're just crossing your fingers and hoping that you don't disappoint that customer because you, the likelihood of doing so, you know, is very high. That's, that's like mentally fatiguing to the max. For someone like myself who like hates disappointing people. The worst feeling is when you are, when you do sign someone and you know you're going to disappoint them because you don't. You're not confident in your team to fulfill the work. That's like horrible feeling. And I know it seems very simple and I say like, just raise prices. Trust me.

You need to reduce the size of the business by 20 to 30% and you will do so by raising the, raising your prices by 40 to 50%. A bunch of people will cancel and you're gonna have 20 to 30% less budget hours on the schedule and make 80, probably 75 to 80% of the revenue you're currently making with probably half the labor. Because now you're gonna peel it down to you and one other person. This is essentially, this is essentially what the six week.

Emergency plan looks like. Six weeks where you raise prices, you peel back to 25 to 30, 000amonth in revenue. And if you're at 25, 30 now, maybe that means you peel it back to 20 or 22. You can be very profitable in that.

There are multiple locations at Augusta that like that $25,000 per month marker, they just keep optimizing for that price. And there's two people working. It's very, very profitable. 12,000, $13,000 in revenue per employee, including the owner.

And they don't work weekends, they don't work any of those things. The employees are happy because they're making a lot of money. In P4P, there's a lot of money on the table for yellow slips. The one location I'm thinking of right now, they covered a $600 yellow slip and the employee was still making over $1,000 in fee for fee.

That is a simple. I know it sounds easy. We always say that it will fix it and I'll talk about this at conference. But there's only three things that typically constrain a business. Leads, labor, or capital. All right, this is capital because if you unlock capital in this case, you're going to have the, you're going to unlock the mental bandwidth to deal with the labor. And from a leads perspective, that's not the issue right now. Right? You can reduce the leads just by raising prices too. So that is the constraint and I know the pressure of having lack of capital. What it will do to you in all facets the business and I. Your mental state is causing the issues with the team. So.

I would also say don't, don't feel bad to share this. This is, this is.

Just fine.

Why does the franchisee go up to 1200 after crossing 24 months and only get basic service at CC? Yep, we've done that from day one. It's essentially a way of moving people from the solo operator model to the growth model.

There is, there's really no goal in having people at the solo model that's we only have the solo model in order for someone to get started if they do not have enough capital, we can't make money at that level from it's not sustainable from a franchise perspective. And someone that's doing 30, 40, 50, $60,000 per month in revenue can absolutely afford $1,200 per month. There are significant costs that far outweigh 699amonth in terms of just sustaining the franchise, whether it be the website stuff, software side of things, command center, all the back end stuff that we do. And the role of the solo operator model is not to sustain there, it is to get someone started that cannot afford 50, 60 thousand dollars to get a growth model off the ground. And so the goal of that first year or two when someone's getting a solo model, the goal should be to afford and get started with a growth model. And it is there for the person that I was when I was 18 that had all the hard work in the world but would not have been able to afford 80, 90,000 to pour into a growth model. And the franchise is not sustainable at that monthly 6 99. And so in order to incentivize someone to move to growth model, that's why we from day one have had at 20,000 per month in revenue, it goes up to 1200. And then once they become a growth model, which makes sense, they'll need more help on the admin side. So if someone's running at 50, 60, 70,000 month revenue in the solo model, they're the ones that we usually have the most problems with because they don't have admin support, they don't have someone running payroll, they don't have someone doing all their full service checking their email. They're the ones that are burning out and it's mostly because they're miss it's not how the program was intended to be used. The solo model is intended to be able to get started and then move into the growth model where that event allows command center to Use full services.

All right, let's see here where we at. Does SA not. Does not have the bandwidth to give us an account rep or is it just very slow reacting to issues across the board?

I just hate, I hate bashing them. Like it's not the goal here. I think service off was a great product. I just unfortunately don't feel like they have the leadership. I don't blame their team members or their employees or their support people. It's just there's not leadership and in terms of account rep we have had multiple account reps. They've all left and so now I have basically demanded. I want the very top and that is Scott Howard in terms of support. He's great. He's awesome. He knows Jonathan very well. He's been with Service autopilot for 13 years and in terms of reaction there's no one that is empowered to react on the part of service autopilot. The closest to it would be Tara and they are handicapping her right now significantly.

With CC switching to full in house payroll etc will that mean they are no longer using qb? Are we still using QB or just done at cc? Will there. No. No changes from your perspective at all. The only thing you should see is an improvement of speed of when there are deadlines or there are specific.

Things that need to be done in your account. Sometimes it's been a day, two, three days delay. A lot of times because we're waiting on. We're waiting on that processing time of running things through Lisa that will stop so we'll be able to handle things more right on time with you. We're still in QuickBooks. Nothing will change on your end at all. Everything will continue. And just keep in mind we've already been doing 90 of it. It's that 10 of workers comp.

When people have child. Child.

Whatever it's called.

Whatever it's called. I forget child support. There you go. They got to pay. That sort of thing. That's what the part we've been running through. But there's no change on your part whatsoever. Whoever the mass franchisee, shoot me a message. This was 100 me last year. Just for everyone listening. Let me see. This was. This was Connor. Connor's dead. Cool. Yeah, it's very, very normal motions to be going through honestly especially in year two once you've grown as fast as you have.

But trust me, like raising your prices is the solution. And like Nick Davidson talked about the other day, I have yet to meet anyone that has raised prices and significantly, you know, resented it I'm probably the person closest to it because there was one time we did raise prices in Mooresville and we lost about 20, 30% of customers. And we probably mistimed that. That was before COVID and all the other stuff. Or maybe it was during COVID I forget how it happened. Exactly. That's the worst. The worst case has been my location. I have never seen anyone lose that many customers when raising prices. And especially in the past three years since everyone's just used of inflation and prices going up. I probably also have gotten better at timing it as well as how to deliver those pricing increases. But like Nick Davidson for example, just started with Augusta the very first thing at training. He was like it was a big deal, like I got to raise prices on these contracts. I have signed 12 month contracts that I have said I'm going to keep this price and honor it. He raised prices on five of them and they all stayed. And so we in our minds are literally balking over raising prices on customers that we don't have a contract, we don't have a signed thing. It's not a 12 month agreement, it's a per cut price. And how you deliver that message is important. And so at training we I told Nick like, hey, have an honest conversation with these people. This isn't sustainable. We can't service your account anymore at this prices. We have to raise them. And so I don't know what the incremental costs of value of those five contracts are, but I would imagine it's probably five or six thousand dollars more a month that is being brought directly to the bottom line. And so the reason you have coaches is to tell you that because you in the moment aren't going to see it right? The same way I won't see stuff in my business and I'll need someone else to call it out, call me out and stuff. You just don't see it, you're in it, right? You got to be able to see. I actually talk about this Lee quite a bit on the C2 unfiltered that's coming out probably next day or two. So listen to that. We talk a lot about this, like the objectiveness of being able to see a business from the outside and be able to observe and tell exactly what the problem is. But then when you're in the moment, you just don't see it. And so that's why you need a coach.

Is because five, six thousand dollars a month, okay, you just paid for your franchise fees, all of your command center fees, just basically got Covered right then and there, right? Just by having someone else to look at your business from afar and be like, okay, this is the problem, this is the problem. This is the problem. I guarantee you I said this with Lee, I said any franchisee inside of Augusta Nation, it's been with Augusta for 612 months, could probably sit down and be a coach and analyze anyone else's business, even if their own business wasn't successful. If they were following the systems of Augusta, they could probably analyze as a coach, any other location. Why? Because it's very easy when you have systems in place to sit back and analyze someone else's business and tell them what they're doing wrong, what they should and should not do. The problem is when you get involved in it yourself and you're wrapped up in the emotion of things, employees, customers, you know, when you raise prices last time and all this other data, it somehow muddles the fact that like, you just miss exactly what you would tell yourself to do in this situation. And so I talk a little bit about with, with Lee, like even for myself, even the past couple weeks, I mean, like, okay, what if I was on a coaching call with Mike Andy's what would I be telling him to do? And I was just blunt with it and like, oh, that's exactly what we need to do. That, that takes a little bit of time to be able to do that. Self reflective. That's why you need a coach. And there's still going to be blind spots. And so you need someone else to be like, hey, look, this is not hard, this is not difficult. Do these things. It will work. And that's the value of having a coach. And that's why the best, the best still have a coach, is because you don't know what you don't know. And it seems simple once it's been told to you, but it, you know, it also just further indicates just how easy it is. You know, strategy is just so low value compared to execution because the what needs to be done. The system.

Is great to know, but executing on that is the hard part. And so, yeah. All right guys, have a great day. We'll see you tomorrow.