Mike Minutes Mastermind 09/07/2023

It's time. Happy Thursday, everybody. Let's go ahead and get things kicked off.

Okay, I'm muted. Good. Check one, two. All right, we're good. We're good, we're good. Okay, let's drop this link.

Happy Thursday. Let's go ahead and get things kicked off.

Boom, paste save, open up the questions and we'll jump in.

I did get an update. We are planning on the week of September 18th to start on that form. If you were wanting to convert over to Copilot.

The week of the 18th is when that's going to start happening. Does that mean you're going to be on the 18th? No, it doesn't. But it means you will get notified a week or so prior to that time when you will get transitioned over. You'll get an email From Eli at CommandCenter, part of the transition team, and he will make sure he sets up a call with you and go through the whole process. And every time they do it, they just make it better and better and more and more streamlined. And we will be prioritizing Zooper users simply because so many of the functions are not working correctly and is being extremely difficult to use. So the week of September 18th, so not next week, but the week after, we will start on that. And even today the call notification automation just rolled out at Copilot. So when Command center makes a call note.

It'Ll automatically text or email you and it'll have the notes of the call in the text body or in the email body. So that is something that they are still, still putting the templates together. So if you're in COPA and you're watching this right now, you're not going to have that immediately, but by the end of next week they'll have the templates already in your account to load everything up for you. And I'll make announcements once that's done. But that's a key feature that we wanted before moving everyone over as well as the wiki page coming out next Wednesday. So just a heads up on all of that.

Another announcement. If you are wanting to get a hotel room for conference, make sure you book ASAP within the next week. We only have until end of next week before they will not like our reservations is done and they will fill it up the rest of the hotel up with Equip Expo people so highly recommend. If you want to stay at the hotel for conference, you book.

Through the links just go to mike.comsummit, book your hotel through there and then if you want to like split a room with someone to help with the cost, find someone on the Facebook group is more than welcome to the chat called Conference Arrangements. And if you need help with that sort of thing, they can help you. You can split a room, etc, so highly recommend doing that asap.

Because I'm going to probably send an email out next week to fill up the rest of that block that they have reserved for us. So please do that so sooner than later because if not this weekend, next weekend it'll probably fill up. So.

Cool. Oh, and on that same note, if you're planning to come to conference, fill out the form underneath the conference tab on the dashboard. So on the dashboard there's a conference tab. I need you to fill out the form for any people from Augusta Nation that are coming to summit incoming at all for the sake of the dinner that we have to have by like we have to have it down to the plate for them and it's $100 per plate, like $98 per plate. So please, if you fill out the form, show up. Otherwise it's just waste. So that form is on, on the dashboard and if you are unsure, if you just submit again, we can remove duplicates, that's totally fine. But we do need it filled out for every person from Augusta that's coming. And if you're bringing like five or 10 people and you're buying more tickets that are public, that's fine. But if they're coming to Augusta, we need to have a number. So fill out the form and get the ticket publicly. If you're getting more than your two tickets per location, hope that is clear. If you have any questions, happy to answer them.

All right, let's jump in.

First question, Landon Smith, Tallahassee, Florida. Hey Mike, I'm not sure if you saw my last video, but I recently had all. What last video? Oh, on the. On the. On the Facebook group. Okay, let's see here. I'm not sure if you saw my last video, but I recently had all three of my guys leave about the same guy at the same time. Hiring has been a major struggle for me as I haven't been able to find any reliable guys. I currently have two guys, but both are are hit and miss on showing up, so they aren't much help. I fired another guy I took on and I feel like I don't have time to run interviews anymore because I just keeping myself from drowning with my recurring work and not even able to get to my estimates. I've also been pushing back all my projects. So my question I'm not sure how to fix this employee issue. I've had probably over a hundred applicants and ran interviews and still can't find anyone. What would you recommend? I understand I could just raise prices and be solo. That that wouldn't fix any of my hiring. That ultimately I need to learn if I want to be successful. I currently charge the customer $70 per hour. Also considering grew this year, so I don't really hit most of my budget times. And I have a base pay of for. That's it right there. You have a base pay of $14 per hour. Would you recommend raising that number? If so, how much? It honestly feels like I would be willing to pay a lot if I could just have a guy or two who guaranteed to show up. It would save me not only from sinking from syncing with the workload, but also we relieve some stress of my guys. No showing every other day and putting me in bad positions. What are your thoughts? Thanks. So here's the thing. You have people showing up at least to interviews. You have people showing up even to work. They're just not consistent. This is even a step a degree higher than the problem. This is a degree lower than the problem we had in Alabama. That turnaround where like no one was even showing up to interviews or applying because it was so incredibly hot. What I would recommend doing is raising your base pay to $18 per hour. You can absolutely do this if you raise your prices to $80 per hour for mowing. Or better yet, keep it at 70 hours per hour so you don't have to change as much. But raise all of your prices so your budget times all come up and you're able to hit your budgeted times. All right. If you go from $14 per hour base to $18 per hour base, I can guarantee you you're going to tap into a different type of market and different type of employee. And ideally people that show up not only the first time, but they show up consistently. So I would recommend doing that. You're only going to have the confidence to do that if you go raise prices on all your customers. I'm guessing you probably have 100, 120 million customers. Raise prices on them just enough to where you feel uncomfortable, probably meaning 15, 20, 30%. Go over it with a coach of who you're going to raise price on. And do it fast. Do it across the board and don't overthink it. Don't that by doing so, you're going to easily be getting an extra 3, $4,000 a month in extra revenue. Even 2500, which will easily pay for the extra $4 per hour that you're going to pay on base pay. And furthermore, if you raise prices and they're on P4P, you might end up paying actually less than $4 more per hour because their base is at 18. But if they're on P4P and they're earning 20, 21, you raising the base didn't do anything in terms of making you pay more. It just simply attracted better talent on the upfront. So this can be fixed and you're gonna have to raise your base pay and you're gonna need to raise your prices that you can hit your budgeted times. Because what this is telling me is you're at $70 an hour. Leave that. But you need to raise your prices on most of your jobs. So you're actually making 70 an hour. You're not making 70 an hour, you're making 50, 55, 60, because you're not hitting the budget hours at 70 with those. With those jobs being bid at $70 per hour. So you need to get those up. Right. Otherwise I can almost guarantee you P4P is inconsequential for your location because they're just not. There's not. They're not profitable enough. So you have to raise the price on all your existing mowing customers. That will give you a little bit of a reprieve. You need to lose some customers. So I highly recommend raising prices by 25 to 30%. Some people are going to leave. Perfect. You need a little breathing room anyways. But now all the extra revenue is going to give you the confidence to go raise your base payback to $18. And now you'll tap into a different market in terms of hiring. Get on a coaching call. They'll walk through some of those steps with you. But that's definitely what I'd be recommending, especially this late in the year.

It's from Anonymous. Can you please go over what is distributable cash? So, yeah, distributable cash is any cash that you are considering to be on the table to distribute. That needs to be defined if you are having a general manager and you are doing profit sharing based upon distributable cash. Because most of the time the guys out in the field, you're just going to give them a percentage of the profits on the P and L because that's what they understand. And they're usually less inclined to stay an entire year, two years, three years, etc. So it's a little shorter Term duration. Distributable cash, though, aligns the incentives of the general manager with the owner by making sure everyone's on the same page in terms of doing one thing and just getting cash distributed to the shareholders. And by doing that, I'm happy to usually increase significantly the amount of distributable cash versus just the profit. Because the profit means that they can take a quarter and just like bomb the quarter with a ton of expenses, have a really massive negative number, and then go collect profit sharing on the three other quarters of the year and they're actually no distributable cash and yet they're getting profit sharing. So I am happy to align my incentives with the GM and give them significant, significantly more profit. Profit sharing that is distributable, a part of the distributable cash. Now what that is defined as in my opinion needs to be clear and how we define it is, it is you take the average of the past three months, the last quarter of all the month's revenue, let's say you did thirty thousand, forty thousand and fifty thousand dollars over the past three months in monthly revenue. The average of that is forty thousand. That is going to be the amount of capital or working capital I expect to be in the checking account. Anything above that number is considered distributable cash. Now the owner has the right to say, hey, I think we're going to be growing a bunch this next quarter. I'm going to, even though there is 20,000, let's say there's $60,000 in the bank account, $40,000, the average of the past three months revenue, that would mean that $20,000 is distributable cash. Okay. And so then that percentage, you know, Maybe it's like 25% to the GM or 10%, whatever, however you're splitting that distributable cash up, that would be determined by you as the owner. I would also be taking my cash from that perspective as well of that distributable cash. Now the owner has the ability to say, hey look, we're going to be growing a bunch. And typically this is easy to get alignment with your GM on. It's like, hey, we're going to be growing a bunch next quarter. Let's keep a little bit more than 40,000, let's keep like 50,000 in the bank account and let's just distribute 10 grand. And basically that keeps more working capital in the business for, for the ability to grow. And if, if you don't need the cash, guess what the next quarter those be more distributable cash. So it just makes it really, really straightforward and simple. It's like hey, the last three months the average monthly revenue is what we consider working capital. Anything above that is considered distributable cash. And that is what we're going to split.

Every single quarter unless we agree, hey look, we need more capital than what the bank the past three months average have been and I see that usually happening after Q1 if you have a really like a, a low revenue quarter one and you know quarter two, you're going to double or get more trucks etc, you might want to keep more working capital in the business.

Kyle Tarvin Moore, Oklahoma for your news location new locations. Do Your crews make P4P bonuses right off the bat? I would think it would take at least a year before the guys consistently make P4P due to the lower prices needed just to get the work. Maybe our pricing on our new location is just too low to start.

Excuse me, I wouldn't say it's the first year, I would say usually the first three to six months. It just depends how fast you grow, right? If you go from 0 to 30,000amonth in revenue within six months, usually when you're at like 25, 30,000amonth in revenue, you have enough.

Route density to guys making P4P no problem.

Again, that depends. Like if you're in growth mode and yeah, all your prices are lower, then yeah, it's gonna be tough for them for them to hit P4P and what I would probably do if I was you is potentially give them a higher percentage and say like hey, I'm gonna give you 40 instead of 33% for the first year because I understand that we're in growth mode and I'm pricing things a little bit lower and I want you to still be able to hit P for P. You could do that. We do not do that.

And usually just really focus on getting to growth and then getting to profitability and making sure that the budget hours are adjusted so they can make above base pay. And two projects are always accurately priced even in growth mode. And so they can usually make up for any sort of like lack of route density due to the fact that the majority of their days are spent doing projects at the beginning.

Hutchinson from Concord, NC copilot feature request new customer button on the employee app. So when in someone approaches the team all information go directly into copilot without needing to go to the manager owner then to cc. Also I think something similar could be done with existing customers when the crew recommends a complimentary estimate or the homeowner asks for an estimate. This way it can trigger an automation to create the estimate rather than being put in the notes. So I would agree this is the thing.

This is a simpler thing to do when you have two, three, four employees. When you have 15 or 20 employees.

Giving them the ability to set up a customer or do things like creating estimates is a little risky. Honestly, you would rather have a line of defense there to make sure that like the email is inserted correctly, the phone numbers enter correctly. They don't misspell things, spell check on their phone in the blazing sun. They don't see the fact that like autocorrected some weird name, things like that.

I'm not opposed to this. And you can actually in Copilot give the ability for them to create a new customer. Like you're saying they can do that from the mobile app and they could technically make estimates from the mobile app. You could do this in Permissions in Copilot, but I would be hesitant to do so for my entire team. I might do it selectively for each user. Like if I know there's a solid person that just like consistently is pumping out new customers and referrals and upsells, I might give them access. But I would be hesitant to do that across the board or make it like a global feature where everyone can like add new customers and do anything that would trigger an estimate being sent. So.

I'm not opposed to it. It's definitely something that could be. I see the use case for it, but for now I think the notes is probably the safest thing, especially for larger companies where it's harder to keep control on two or three or four guys and making sure they understand certain processes. When there's 15, 20 guys and you're getting five or six or seven upsells a day, it's hard to keep track. Like, okay, this new customer, why is the emails not going through? Well, they misspelled something. They only put, you know, eight. They put eight digits instead of seven digits on the phone number. Like things like that. Right. It's a little harder for quality control. Not opposed to it. It can happen and it can already be done by just adjusting your user settings in the permissions of copilot. Devin from Red Deer. 45 days ago my truck was in the shop. Yes, we are hustling in. My employees lifted dirty Tiermax. We did a spray job for 250 in 10 minutes. Customer claims we were too quick and sprayed his lawn with Roundup. I did a drive by. It looks fine in the front, waiting for pictures in the back. He said if I go to collections, he'll fire away with bad reviews and take me small claims court for messing up his grass. What should I do? Just leave it, I bet. You know, obviously they're misusing the fact that it's a smaller bill. They probably think they can get away with it. I would take pictures of the lawn to prove that it wasn't Roundup. Because if they actually claim that and you have pictures saying, hey, the grass is green and growing just fine at week one, week two, week three, etc. Probably can disclaim, you know, throw out their claim pretty quickly. But it, again, it might not be worth $250 to you. It might just be worth just, hey, just move on and just forget about it. But that'd be up to you. And Whether or not 250is worth, you know, going back and forth to this customer or potentially risking bad reviews. But they're obviously just misusing the system and the threatening. They're threatening you, essentially. So. All right, everyone, have a fantastic Thursday. We'll see you tomorrow.

Sorry it's so late. For some of you, it's like five o' clock already. So have a great evening. We'll see you guys tomorrow.