Mike Minutes Mastermind 09/05/2023

And we're live, everyone. Hope you're doing super well. Let's go ahead and get started. Drop this into Facebook real quick. Oops, that's wrong. Live stream.

I wanted to say one thing real quick.

I could just figure out where to push this merchandise.

There you go.

Plugged in. Are you serious?

Unplug my microphone.

Okay. I want to say one thing, and that is like.

I would just be careful with in general, but also inside of Augusta Nation, looking at someone that is doing well.

I. E. High revenue and thinking that whatever they say is applicable to you. And I say that because.

A lot of times you can do a lot of things in your business to inflate your revenue.

And have all the trappings of success without having a sustainable way to make that profit, make that those services profitable.

And so someone that grows really, really fast at Augusta, for example, the difference between someone growing from 0 to 30 to 40,000 their first year and someone goes from 0 to 80 to $90,000 per month in their first year usually comes down to that second person did a lot of projects, totally fine. What happens is they post about it or they talk to other people, and those people think, oh, I should add all these services. I should add, you know, go far away from where my territory size, my. My radius. I should do all these things because they're successful. And the reason I say this, because it is striking to me how many times I do consulting calls with people that are doing 10 and 15 and $20 million businesses and worry every single week about hitting payroll and have profit margins that are in the single digits, the low single digits, and worry every single day about whether or not their company will make it. And so anyone else that would look at what they're doing and say, oh, they're successful, I should do what they're doing, if applied to their small business, will lead it to grow, but will lead to the exact same stretches that they're facing after 15 and 20 years of business, of growing that size company because it wasn't built on fundamentals and systems that worked. There's a difference between building a business that is sustainably built on systems and can run without you, and a business that requires you to always be juggling the balls because there is no systems.

And always requires you there. In my opinion, that's not a business that is a very, very good job. And when I say very good, I mean, well, paying. Not a great job to actually have, but because you're stressed out of your mind and running around trying to do a thousand things and is it easy to create systems, delegate, trust other people, let other people make mistakes? No, because that will happen.

If you build systems. It will be more difficult in the short term. It is not easy to implement something like pay for performance. It is why more than 90% of people. Yeah, I guess like 88. 88 to 80. 88 to 90% of people who sign up for P4Psoftware.com leave within one month.

And is simply due to the fact that it is not easy to have a system instead of use the path of least resistance for growth. And so someone who grows really, really quickly and starts off really, really fast by taking out certain constraints, it does allow them to grow faster. Those constraints are extremely hard to take, take back. They're very painful and expensive to fix and they lead to extremely low profitability that most people, if they knew that was the end result, would not sign up for what they have. And so whether you are listening to people outside of Augusta or inside of Augusta, don't look at top line revenue as the marker by which someone's level of business acumen is, is established and take everything they're saying with the authority of oh, they have X size business or I see them the max max metrics. I see them in the top revenue, therefore I should listen them because I'm lower than like that's not necessarily true.

And so like the vast majority of people who book consulting calls for me.

And they need about 15 to 20 minutes of my time and they'll spend a thousand dollars. Insane. Most of them, most of them are 10 to 20 million dollars businesses. And the reason they have to come to me and pay me to do it is because they are too embarrassed to go in front of all of their competition and in front of everyone that they've all has always looked at them as successful and admit that they are struggling financially. They, they are running their brain completely scrambled and they have been told and they have started to believe that they are quote unquote successful. And now it's very difficult for them to undo everything they just did. I told a guy that had $17 million in revenue last year, I just told him that he needs to go down about $4 million in revenue. That's not easy, but he will be far more profitable and he'll keep his sanity. If he, if he strips it down to 4 million, I think you could be 25% profitable on 4 million, a whole lot better than being 2 or 3% profitable on 17 million.

So.

I would just, I would just warn you about that top line revenue is a metric is so easy for us to measure and that's why everyone gauges that as success, because it's an easy metric. It's like, what was your number last year? How much revenue did you make? It's a simple number. It's easy. What that is hiding though is not just profitability. It's also hiding stress levels. It's also hiding what that did to their family life. It also is hiding the sustainability of it without one or two key people that if those people would leave. There is no systems or redundancy or training in place to keep the business afloat. And one or two people are literally holding the keys of the entire business. Very, very scary.

This is why a lot of times when divorces happen, the businesses is so negatively impacted is because everything was built on the brain of the operator and then someone in the office. And so when that is broken now all the keys to the business are held in someone's head.

So anyways, that was my little rant for this morning. So. All right, let's jump into questions. If there are any.

Just pull it up.

There are four. All right.

Share present. Boom.

All right, Matt from Delta Mike, you mentioned a location in our area may be going up for sale. I'm curious about that process and if you corporate advise or involved in it, valuation, deal structure, procedure and finding, vetting, approving a buyer. Yeah, so we are, are involved. We cannot stand in the way of you selling your location like legally. So if you have a willing buyer and we do not have probable cause to think that they're going to hurt the brand, we have to let the transaction go through. We've never had this issue. We always get involved to make sure it's very, very good transition. Everything gets moved over after training. Like we always get involved, say there is a location. The process basically is once someone has talked to a coach, they have to talk to a coach before anything goes forward. Because we've had multiple people that think they want to sell and then they got on a coaching call and they realize like, oh, it's worth less than I think because it's. I'm four months into this and if I just changed my pricing or I changed one or two things, it would resolve 90% of my problems. So you have to be on a coaching call. They know the process. Then you fill out a form that is on the dashboard and gives you all your financial information. We then at the media team create a flyer for you to be able to use to sell it. You can it's up to you to sell it. We do not market it besides putting it on the franchise page. And so the vast majority of sales have happened to either existing owners selling to someone else or they find someone in their local market that wants to be join Augusta. Um, and this is like an easy way for them to jump, you know, a year, save a year or two. So.

In terms of the vetting process, like we do vet them, but the only way we can really stand in between it, like if you like, hey, this person literally wants to give me $50,000 to buy my location. I want to accept it. The only way we as franchisor can step in there is if we think it's going to hurt the brand. And we have to have like evidence of that. So we've never had that problem. It's always been really, really good. I think there's been like three or four transitions and all of the locations have been much better after the sale. So.

Devin from Red Deer. Hey, Mike. Should I pay myself a monthly salary? I've been living off my business account. Bank doesn't want to give me a MasterCard. LOL. We're already at 100. Yeah. So if you're 100k in revenue, I only just got started. So like the. I think you're doing like 30 or 40,000amonth in revenue already in this year. I would probably start giving yourself a salary because you don't even have one year's tax return. Like if you had a tax return that showed you took $50,000 in distributions, for example, or 60,000, then you'd probably get the MasterCard. So I would say in the short term is get a lower limit credit card, like a 501. You might be able to get that and this to build up some credit there and then, you know, pay it off like every day. And then for your personal expenses. And then maybe next year, once you have a tax return under your belt, turn it in, S Corp, start paying yourself a W2, paying yourself as an employee. But really what they're looking for is that first tax return. Like you haven't even had one tax return underneath your belt. So I know the business is doing well. It's growing really fast. But until they see that tax return, they're not going to believe you.

Ken from Fenton, Michigan, have you ever looked in a deep lawn for property management? It looks like it's a reasonable price. Your thoughts? Yep. We are working with them to do an integration with Copilot. It is reasonable, but it is still expensive to Extrapolate against, you know, the larger locations that get hundreds of these.

Requests every month. So we are working with them probably starting in. I think it's on the board for end of October, early November to be integrated with Copilot. But I think there's better ways of doing it that don't require the cost and furthermore not relying on their UI and how they walk you through, which is really smooth and really good. But it's hard to customize because it's out of your control. So there's a few things I think that can be done to prevent having to spend. There's multiple companies that do this, but anywhere between a dollar and 50 cents to $4 per address. And it's not data based, like it's not like you keep that information. It's like a one time hit to their API. So. But it is cool. It is very cool. And their accuracy is pretty good. It's not, it's not perfect, we've tested it, but it's pretty good. I just think that the level of accuracy that they have you can actually do without even needing their technology just by using rounding and questions. So a little more on that coming in a couple weeks because we're going to be making an optional thing for the website. I think we'll basically do what Deepline does, which is like the goal is like get the person to check out. I think we'll be able to hit that so without having to pay them on every single one either. Hutch from Hutches. Hutch, let's go. Connor. Why is Commencer not open on Sundays? Just thought this could help curve the amount of work. Amount of work that builds up by Monday morning. Even large amount when it is a long holiday weekend. Can we get a Command center weekly or monthly update email like the 747 reports from Copilot. This could include updates on Macs in case people are missing masterminds or small changes to the SOPs like marking estimates lost after five to 10 days.

Yeah, we could probably get an update. There's usually I'm sharing everything that's changing on my. On the masterminds. I don't want to make another communication mechanism because I just wanted to keep it as simple as possible. Like listen to the masterminds, I'll update you on everything. And so Command center usually gives me an update and then I will pass that along to all of you. And once we're all using the same.

System, which is Copilot, it'll be way easier for them to give me updates. Like I really look forward to having us all in one CRM and then we can spend our time like optimizing automations, optimizing email templates like creating like putting the media team in like making things look better like all sorts of stuff but honestly there's not enough changes like 747 updates at CO pilot every single week we're going through 30 to 40 tickets of things that are actually changing with with Command center. Maybe one thing a month, two things a month max change. And so I'm usually sharing those on the.

The masterminds and Liz watches these and if she ever has something she wants to add or said hey please address this, this needs to be addressed I just share it here that way it's just like one spot. You guys just know like hey if you listen to the masterminds every single day and in the background I have the audio versions only on the dashboard. If you want to listen to while you're working you know you will be caught up to date on everything from conference to command center to updates of copilot like everything so but yeah if Liz makes changes and there's change at commands and she will let me know, I'll just bring it here. In terms of Sundays, the challenging part is this. So we've been working like last year, like a year and a half ago we did a lot of virtual and we found out like just how difficult it is to manage virtuals. This year we have done a much more controlled manner and we really are starting to hit our stride with figuring out virtual training, keeping them accountable, keeping them productive and efficient etc. Being able to weed out like with reporting and all the rest of it. And so.

We have thought about doing Sundays. The challenging part is this regardless if we have someone if it's open five days, six days or seven days a week there has to be management involved whenever it's open. And so down the road I think when we get like in a couple years when we have 100 plus people it makes more sense to have managers that are doing some sort of rotating weekend schedule because getting virtuals to do it wouldn't be difficult. It's the challenging part is getting people that are higher level that understand it because you can't just throw someone that's been here for six months on the phone by themselves without any back end support. That of like when things really go wrong when someone calls in there's all sorts of problems their invoice and like there's something wrong with the automations or like there's so many different layers. You have to have management and you have to have team leads here to answer questions, especially when they're virtual. There's no one literally for them to look at and talk to. And so.

For now we're not really focused on Sunday. What we're really focused on is just continue to increase the SOPs and the systems at Command center, making sure that we can have virtual people and then really nailing that. And we are getting better and better. We've done it much more controlled manner this year.

And down the road it could be something that we could offer. But. And it's definitely in my mind because like Monday is always just stacked here.

But for now I can't expect my managers to be working seven days a week and we don't have enough managers to make it worthwhile. What my thought is is that down the road we can create managers that are virtual and their time zones work better and there's more flexibility and we hire them with the intent of having them at, on a weekend level. Whereas everyone that is management or team leads has been here for years. And I never, they never signed up for a seven day position or let alone even a five day position. But it's going over Thursday, Friday, Saturday, Sunday. Right. So down the road though, what would happen and the possibility is to hire people with the expectation from the get that they are going to work the weekend. But it takes me a couple years of them really figuring out everything for me to be confident enough to then put them at the top as like the go to contact without any other oversight needed during open hours, like during open hours, like all hands have to be on deck even on Saturdays. You know, Liz is still very much involved with keeping everyone at Command center on track, addressing things that come up that are fringe cases there, no matter what systems you put in place, there's just not enough. There's always very, very fringe things. Like what happens when a neighbor calls of a customer and they are convicting us that we, you know, ripped up their, broke their window. Okay, well what, what's supposed, like do I need pictures? Do I just submit this to the franchisee? Is this something I try to take care of for the franchisee? There are times that we could take care of entirely. There's other times, like, no, we need to submit this because like, this could potentially not be their fault. Like, so there's different layers and there's always such fringe, fringe issues. And usually those issues are complaints and they're sensitive. So it's not like we can just throw anyone at it, even if they've been here for, you know, three, four, five months, and they're great. They just never even seen how to deal with certain things. So, yeah, weird question. Why haven't you opened more corporate franchises in Washington? I really like North Carolina for a couple reasons. One, most importantly, it's close by Chuck. So as my regional manager, he's able to be in touch with the GMs and be close to them. Secondly is their winters are better. Ours in Washington aren't horrible, like, but we do have snow a few times a year, which kind of locks us up from working for a few weeks. And then it just way colder. So the guys are less inclined to want to work. Whereas down south, like, if you do a really good job of door hanging for property cleanups and leaf cleanups, you could potentially stay busy throughout the entire winter in those markets. Um, but like 98% of that calculus is literally the fact that my regional manager is there and I'll build around my regional manager. We just find this over and over and over again. Location level completely dependent on the operator, the general manager. A location is not doing well if it's not. If it's not growing, if it's not being profitable as. As quickly as we want, it is 100% the operator and the general manager's fault. The same thing is true. If a collective group of locations aren't doing well, it is completely the regional manager. Right? And so I want to set up any regional manager for success by keeping their GMs as close to them as possible so they can jump in, so they can help them and give them support so that they are collectively doing well. And in the future, we do want to have multiple more.

Territories and locations being done by regional managers that have four to six, seven, eight locations underneath them in a collective area. It'll all come down to where that regional is. They'll have to prove themselves. And then, like, usually as a gm, and then, okay, you might be a good regional if you're in this spot. Let's build around that. Right? So do you think the instant quotes will do good in winter in Washington?

It's so. It's so location dependent, right? Like, just saying Washington is tough because you might do really good in one neighborhood. You go to the next neighborhood. It does not work because the one neighborhood is next to the school and they get tons of door hangers and they get other stuff from the high school of, like, fundraising stuff and all this other garbage. So they're kind of numb to anyone doing that sort of marketing. Whereas the other neighborhood, no one ever does that. It's a lower affluent place and people don't usually think of marketing to them. Well now all of a sudden you got three or four customers in a 200 house neighborhood versus zero in that first three or 400 house neighborhood and you're like man, it didn't work. Well, if you did this next door, the neighborhood next just a little over, you could just crush it. Right? So whether or not instant quotes work well in the winter in Washington, I think it comes down to can you do the work and is there a need? And if you can do the work, that is there's not snow on the ground and people have a need is going to come down to your level of ability to sell them on that. This should be done now because there is no pain. The grass is not growing, the leaves are not still falling, the bushes are not continuing to grow. However, the demand is still there. It's just can you convince them to do it in. In January and February instead of March and April is what it comes down to. And so someone's ability to follow up, doing follow up calls, be able to talk to customers, they'll price things appropriately, which is usually lower. And having the lower margin, like you're either going to have lower margin by filling the schedule or you're going to have. When I say lower margin, you're cutting prices and you're spending money on marketing or you're going to cut all of your expenses, I. E. Lay people off, really pull everything down, take some services back from command center and really constrict and just either way is fine. It just which one do you want to go? Do you want to go more like growth, which is like lower margin, Spend money on marketing, spend money on keep your guys busy keeping the jobs on the schedule. Or do you go constriction and there's no right. Right or wrong way. It's. You got to choose that. So. All right, I gotta balance on my next meeting. Thanks everyone and we'll see you tomorrow.