Mike Minutes Mastermind 08/31/2023

Hey, everyone. Opening super well. Happy Thursday. Let's go get started. Just grab this link and drop into Facebook.

Today is the last day.

That Augusta Lawn Care will not be inside Copilot. Starting tomorrow, they come. The companies that came for training in July will be using Command center to use copilot starting September 1st. So kind of exciting. Also very, very.

Scary, honestly. So.

I feel good about honestly, is the fact that I still have four months before a lot of the bigger companies are coming in, and I feel like we're making pretty good headway, and in four months, we'll make it really, really good. So I'm mostly scared by the fact that. I know it sounds weird, but I'm just being honest.

Something going wrong for the other users. A lot of them, you know, they're very much in it. They want to be on the cutting edge. They want to. They like all the new features we're making, things like that.

They. They understand there's bumps and hurdles, but when it affects Augustination, like, my level of stress kind of goes up exponentially.

So, yeah, I'm definitely, as I told the managers, stress out of my mind over it. But I'm very confident that over the next four months, we can just make it really, really good and. And.

Just build something really cool. So, yeah, tomorrow, people from Augusta, I know a lot of them are already in there. They're already using it. They're already operating their businesses. Some have operated since the beginning of Copilot, and then they switched over to Augusta. But it's the first time that Command center will be starting to use Copilot, which means using the whole back infrastructure we built for Command center to access the software. So now if you guys came to. Came to Command center, and whether it be here or our virtual team, they all have these timers. Not these timers, but they have timers all on their desks, and they're literally clocking every second so they can bill appropriately. I guess, technically, this is an announcement. One second.

Our goal is to get rid of that because it's extremely. Just a pain in the butt to be having to do that all the time for them. Like, they have to push that button probably seven, 800 times a day. And they have multiple. If you came, you probably saw three or four on some of their desks because they're working on someone's account and they're waiting on a chat, so they'll switch to someone else's to end up working on this one. They have all these timers, and then we're doing A work log and it's pretty good in terms of workload. We've created a really good system around it, but it's annoying. So we, we're really working a lot on the back end to make their jobs easier and just less headache.

And make the billing a lot simpler. So anyways, that's a big thing we're working on in terms of Augusta and then just making features that like we've always wanted and that I really want to see inside of Copilot before the end of January or in the December. So like yesterday the the required credit card on file just got passed and it's really nice basically if it's. If you have. You have a global setting and you have an individual setting for each client where you require a card to be on file in order for them to accept an estimate. And so there is no more required need to have an automation after an accepted estimate. Asking for a card on file will not need that. It'll be when they click accept it says hey, you need a card on file, they have to put it in. If someone calls in and accepts an estimate.

The there's a pop up that says hey, there's a car that is required on file. Would you like to add that card on file? Or you can skip it. So if you had to, you could skip that and not require a car file if you from the office were accepting the estimate. So there's that ability next, not next week, but the week after. We will also be having where the same logic will be used where if the invoice total is over a certain amount, it will require a deposit on that credit card prior to them accepting the estimate. So again just these things that constantly cause a lot of pain.

And even like I was for my real estate that I have Augusta, you know, servicing the properties, paying the invoices still done by check because like managing the different properties with the same credit card and like the same login or different logins across the board the different properties has been such a pain. Liz says she still writes checks out for all of them because like the client portal is such a such a hassle with having all the different properties and different accounts etc. So hopefully that's alleviated. I'm really looking for just those two little features alone. Credit card required on file before they accept an estimate and getting a deposit before they accept the assets. There is no like when they accept an estimate, you know, you're putting them on the schedule. There is no like, okay, let's make sure that they Put a card on file. Let's make sure there's an automation. Let's make sure that they get the deposit paid before. And you know the big pain is when you have like a big job accepted and it's like starts in three days. You want to put them on in three days, but you've got to accept, get a, a deposit and calling them, emailing them like, hey, I got this deposit. Or you start the job just crossing your fingers and hoping they don't not pay you because you don't get the deposit and you want to put them on right away. So.

Some really good stuff I'm just, yeah, very much not looking forward to. I just know that there's always issues when we're introducing as many features and improvements as we are and I do not look forward to having to be at the brunt of all that. So we're just doing our best over the next four months to put like redundancies in place. We're changing the way we do code review. We're switching over to aws, which will then putting redundant servers the country. So if one goes down, we're good.

So. And then we're also doing a later in September, October, we're going to have probably about five users that have been with Copilot for a long time. Being a beta group where we release everything new to them first and then wait a week before we release it to the public, which is going to dramatically drop down how many bugs get into production. And so yeah, so we're doing a bunch of stuff to improve it, but still doesn't take away from just how.

I'm somewhat not dreading it. It's exactly what we want. It's just, it's a little more pressure. All right, let's drop this. I don't know why didn't this come into here? Oh, that cool. All right, let's open this up.

All right, number one from nobody. Anonymous. This one. Hey, Mike, I was wondering how training bonuses worked. I was under the assumption that you add however many dollars an hour in, in our case, $4 per hour to whatever their actual hours were, regardless if they hit P4P or not. Since most trainers don't receive fee for fee. Am I wrong in the assumption? The only reason I ask is because I had a conversation with CC about trader bonus and they informed me that even with trainer, the trainer didn't hit base pay. Thanks. Yeah, so this is completely up to you and you can tell command center if you want this done differently and that is to lock in basically raise the base pay of the trainer instead of just tacking onto their P4P. And how this is done is you're going to do it on the manual adjustment. You're going to tack this onto their payroll bonus instead of P4P only. And this is a big reason why we made this distinction earlier this year on manual adjustments is that you can do a manual adjustment and then lock it in for them and not tie it just to P4P. So if you want to lock it in, they're gonna get that four dollar per hour bonus as a manual adjustment, but you're gonna lock it on a payroll bonus which locks in regardless of their performance instead of just P4P.

So you can do that 100%. Also, one thing I was talking about with Corey, the GM Bellingham, this morning is he wants to next year potentially have it where in order to get that locked in $4 per hour, it requires the trainer to check in with the GM every single day for the first two weeks while they have a trainee that they're responsible for. It's like they have to do that in order to get that locked in $4. And secondly, we might do where the first paycheck where the trainee is out of. Out by themselves, they're solo. If they hit above base pay on their first paycheck, their trainer gets like a $200 bonus. So then it's a matter of the trainer checking in on them a little bit that first week or two, making sure they're good. Hey, I saw you, you know, got out of the shop a little bit later like you're. Because they. They're now incentivized to make sure that their trainee does well after they train them. So I thought that was a really good idea. He's gonna probably perfect it over the winter, make sure everything's very clear and basic for the guys to understand, like, look, you're gonna get $4 more per hour. Now gonna be locked in. But I'm now requiring you to check in with me, the trainer, check in with me, the gm at the end of every single day and talk about your trainee, and I'll lock that $4 per hour bonus in for you. After the two weeks of training, your person goes solo, their first paycheck outside of being trained, you will get a $200 bonus if they get above base pay. So I think it's a really cool way of incentivizing.

The trainer to still keep track or keep tabs on their trainee and care about them afterwards.

Do you Let employees in customers copilot customers invoices to edit and see anything. No, not edit. Definitely not. I don't mind them seeing stuff. And you can change this all in your permissions. I don't mind them seeing it.

So we are going to be changing the button on copilot to there's like a. A complete inv. We're just going to change it to complete and then because we're changing the way that the invoicing works, it'll just basically mirror how service all plats always done it where it's getting added to like a incomplete invoice until the end of their their billing cycle. But all that to say you can change whether or not they see or not in the permissions. I would not let them edit it. I don't mind them seeing it, but I do not want them to edit it. Just personal. Whether or not they see invoices is honestly inconsequential because they rarely need to.

Kyle Tarvin Moore, Oklahoma Is there a minimum income amount your customer demographic should have when you're planning on going into new territory? Curious how you went about vetting the market when planning your five new locations. I would say there's a minimum income amount. What I have seen is.

A pretty good distribution of when a location has higher income. It also costs significantly more in all the other regards. Equipment, trucks, fuel is higher, cost of living is higher, meaning labor is higher. Right. So there's still areas in Augusta that are paying $15 per hour as base pay. Right. You know, the Bellingham shop for the first time ever is raised, probably raising to 20. We've been 18 for a really long time and we've always been able to get enough candidates. We're probably going to raise it 20 next year. I can't believe we've honestly been able to hold out this long. But it's mostly because you're the larger companies usually attract talent a little bit easier just because you have more brand awareness. But we're gonna have to raise. Right.

So I don't necessarily look at income. What I am looking for is I want to see population growth, population decline, don't like it. That's the biggest thing in terms of when I look at a market in terms of. Because if you have. If you have. If you have.

Population going up in a demographic, it means lots of different things. One, there has to be new construction. If there's not room for new construction, it means that the price of real estate will go up. And that's why everyone always looks at Real estate as such a, an asset that is kind of quote unquote always goes up is because if you restrict housing and right now it's make municipalities and cities are making it so hard to get permits and build that it is artificial cap on growth of real estate, new housing that just inflates the cost of what is existing. And so the more and more that regulation and government gets involved in building, the more and more these real estate prices will continue to go up. And so I don't see deregulation coming anytime soon. So as long as the income or the, the, the, the population is going up, I'm, I'm all game on that market. The only thing I'm looking at.

Kyle Tarvin I was talking with Chuck the other day and the topic came about some struggles and things the new locations have had to deal with this year. I know Chuck already had a lot on his plate, but I think it would be very beneficial to do regular internal videos for Guest Nation only on some of the struggles that the new locations are facing. Maybe it's just me, but I learned a lot going through other people's experience and seeing it firsthand. Yeah. So I think Chuck's talk, Chuck is speaking at on Wednesday for August Nation and Lee is as well. And they're going to be sharing those things. Just keep in mind, the same way that I can't openly talk about all my employees and the struggles they're having as they're happening, I have to kind of do it in retrospect. Right.

And so because they work for me and if you started talking, if you started talking about your employees publicly and what they're going through, most of them wouldn't want to stick around. So all of these locations have general managers, they have employees. They of course have struggles like any of us do and it's difficult sometimes to talk about them. It's different. If like Chuck was, Chuck came to your location and started talking about your employees and, and shared that with Augusta Nation, that's one thing. But for the, the person that is the employer to be talking about their employees, it gets really, really, really tough to do that live. Like, okay, yeah, yesterday so and so messed up yesterday so and so didn't do their follow up calls and that's causing them to not do well, that's really tough. So you know, we have had it before already where I have done that and general managers take it very personal and I appreciate that they do. It shows that they care, but it's also not something they should have to think about in the day to day because I'm their employer. So we try to be as careful as possibly can and share as much as we possibly can. And most of that sharing comes in the form of us learning and then adjusting the systems. Like we adjusted the comp plan for GMs this year. We created a starter role. So if someone was really good at sales but didn't really like, you know, optimization for profit and they liked growth mode but didn't like profit mode, we'd have a position for them. We have really nailed down comp plans for what a regional looks like and their incentive to really stay there long term is huge versus you know, short term growth. So those are the type of things that we're learning and documenting the systems and everything. And then in terms of like sharing more the day to day quote unquote struggles, we have to be careful with that and be more retrospective. And that's what Lee and Chuck will be sharing with on Wednesday of conference.

Connor from Evansville like you'll hear all the stuff that happens. Bellam Shop Lee will talk about that, Chuck will talk about the struggles with some of the gms and they have to replace people out and put new people in in the whole nine yards and what those conversations look like. So he can talk about that in retrospect. But doing it while you're like you have someone in a performance improvement plan is not a good idea when you are the employer. Connor from Evansville Correct me if I'm wrong, but I feel like I'm transitioning to more mowing based sort of has its own cash flow issues. But I feel like transitioning to more mowing based sort of has its own cash flow issues. Got it. We went from 40 mowing to 85% mowing about 15k a month in mowing to 40k a month roughly. Usually at this time of year cash flow gets better. However, I'm wondering if I just get my cash flow and profits in larger chunks now that we have switched from one time where we bill at the time the time of service versus mowing where we bill at the end of the month and have to wait to collect all that money. My credit bill is less now that we have to do less projects and check to the guys and check to the guys are more consistent. Oh, checks. Got it. Is this correct or am I missing something?

Yeah, it definitely has its own cash flow issues. Right? Because the problem with the great thing about projects is you can schedule based upon budget hours whereas with mowing those budget hours ebb and flow with the weather a lot. Now what you have to do is realize that you use projects still to fill in those ebbs and flows. Because with projects I can market and immediately with one or two projects, book out myself for a week or two getting some larger projects and fill in the gaps of the mowing. The fact is I like the fact that 70, 80% of my.

Revenue is stable and then I can flex the other 10 to 30 or 40% of my revenue based upon the time of year. And so you don't want to abandon projects. In my mind, it's a way to flex your marketing and flex your lead flow because you know that you're just getting one or two projects can fill a week versus getting one or two mowing jobs is going to feel like an hour of your schedule. So that's why it's usually a slow, slow, gradual increase in recurring mowing. But then you still keep the projects as a way to keep yourself busy and profitable during the month. When people start to cancel and mowing, it gets, you know, dormant people skip services, etc. It's easier to do that, more immediacy, like turning on the switch and turning off with projects versus if I accept 20, 30, 40 mowing customers to get, you know, my schedule filled, I can't like turn them off when things get busy. You have to keep servicing those accounts. So I would look at like, hey, this is my capacity, capacity based growth. We know that number is based upon our scorecard and then what percentage throughout the year of that is recurring. So if this is like 100, this is 75, 80, 60, 40, whatever I'm at in terms of what percentage of that is recurring revenue. And then I'm filling in the gap between where I'm at recurring and my capacity with projects. And so I'm okay with that because I can market and fill my schedule with projects faster than, than I would trying to get 2 or 3 million customers, which don't do anything from booking out my schedule in the immediate term. So.

Yeah, I'm just wondering how this is tying to cash flow.

It's still going to be seasonal.

I got you. I got you. Yeah, you're 100% right. Like obviously with projects you're collecting up front 50%. You're basically covering your, your, your cost of goods sold and then you're collecting everything else like at the end of the project. And so it's better for a cash flow perspective, I would say from a cash flow perspective, projects versus mowing is the, is why you'd switch. Well, I'm, I'm rhymes. I like. I prefer that, you know, 60, 70% of my revenue is coming from recurring versus 10 or 15% is the gyrations of revenue and the pressure that puts on you when that revenue drops below your fixed cost. Because if you, if you, if 75, 80% of your recurring, of your revenues come from recurring, you know, you're never going to actually lose money each month because, you know, if you just mowed all the lawns, you'd cover your expenses. That's not the same thing if 20% of your revenues come from mowing, because if you don't have a month where you can't sell any big projects, you can't sell enough projects, you could actually lose money, like, because your fixed costs are, are high enough to the point where 15% of revenue, that is your recurring work, does not cover the bills. And so that's the advantage, quote unquote, of recurring. In addition to the fact that you can typically systematize it and step away from daily operations easier than if you're managing 30, $40,000 projects, not against 30, $40,000 projects,. You can absolutely systematize them and make them profitable. And I really like having both of them to be able to make sure that my recurring revenue covers my fixed expenses. And then anything in and above that, I. E. Projects is like money on top and it's gravy. And so a lot of people, what they say is like.

They'Ll say like, well, money's all in the projects. And then they, they like, well, we just do mowing to kind of like, you know, keep the guys busy, when in reality, the mowing is what's paying their fixed expenses. And then any project they do get on top of that is, does seem like profit and gravy because they've covered their fixed expenses with their more stable and level.

Level revenue. And so.

Yeah, from a casual perspective, sometimes products are better if you're collecting 50 upfront, because you already have that cash before it's actually paid out in wages and materials, etc. But it's, it's the fact that I know I have no guarantee that next month I get all those projects. I can with very good certainty, know that If I have 300 million customers today, I'm not gonna have a hundred next month. Right? So.

Again, I'm not against projects. You can absolutely get good at booking yourself out far enough. You will absolutely be able to have a stable schedule as well.

All right, everyone have fantastic Thursday. We'll see you tomorrow. Take care.