Mike Minutes Mastermind 10/09/2024

Hello destination. Hope you are doing.

Amazing.

Much better. All right, very good.

Welcome to the Mic Minute Mastermind. Sorry it's a little darker, the lights have changed. But do not worry, I'm going to get a desk light that'll light this up and make it look much better. So sorry it's a little dark, especially with a black shirt on. Mercy. Okay, let's get things kicked off. Looks like there are six questions in the queue present.

And here we go.

Cool. First one is from Coach Connor. Is there a way on the website that when a customer selects property cleanup landscaping other that we make we can make a field where they have to fill it out and say what they're looking for or what side of the home. I have my wife currently call everyone that fills out this form and ask if there's something specifically that they want any done. I feel like I have a lot of points of contact because I end up estimating something totally different or I have to go back and estimate something different, et cetera, et cetera. Having an idea of what people are looking for would be benef helpful. Yep. So we already work on this. I wanted to make sure that by having that extra field it did not reduce any the conversion rate and it did not meaningfully do it. And so we are looking at this right now basically as if they select landscaping, other etc. A pop up would be it would be an optional text field that they could put project details in if if, if they want to. By making it required we saw a pretty good drop off in conversion rate. But by making it optional then basically if you get that information you would know that they put it there and if it's empty they specifically skipped in the in that case most of us would rather have the lead.

Instead of just losing lead because they didn't want to type in stuff. So.

That'S we're working on that right now. So it's not done but we are working on it. I'll let everyone know once we finish this up. Why do some PayPal is from Tim why do some PayPal transactions mark co paid in Copa and others don't I have had several get contacted that they are overdue when they paid on PayPal. Thanks. So you can look at this.

You know if you want with with ATC and see what's up. I know that PayPal sometimes takes longer to transact and then it doesn't report back to us at copilot but they'd be able to see this on the back end if you talk with atc they can make a note of it and see what's going on. But they would need to see when this is like when you're seeing this, they need to see it in order to diagnose what the problem is. But, but sometimes PayPal, it's not like an instant thing cause it's not an integration with Stripe, so it might take longer to report back to us. For example. And if they're using say ach, it could be like you're getting an automation sent to the customer saying hey, this has not been paid yet. And it's because it's two or three days just to process if they're using their bank account, for example, on PayPal. Whereas like they're usually their credit cards are immediate and their PayPal balance is immediate. But again, if you see this, please like make it. You could send it to a video even if one with atc and they could see if this is actually.

An issue or if it was just a matter of the processing time between PayPal and ours. And like showing it to copilot because Stripe shows way more data to us than PayPal does. Troll from Lafayette. Alex Ramosi sent an email saying he saw better conversions with an about video on his company's websites. Do you think that this is something that could work and we could test for our websites perhaps starting with the Christmas lights websites next year? I'm thinking the ability to add an optional video on the whole page that each owner records themselves to explain our process and unique values. Not a generic Augusta wide video yet? No. So a few things. So keep in mind the target demographic that Alex is going after versus our customers. Our customers are coming for a specific need and they are very selfish in the fact that they are looking for a problem to be solved. I've tested this across my stuff too, versus Augusta. So in the past I've had this exact thing on Augusta's website. And the thing is customers do not care about you now with Alex, they are coming to the site because of Alex. When they go to my social media, they are coming to my stuff because of my personal brand. And so having that affiliation with this person is already like you already have this massive amount of trust built with this person.

Your customers aren't coming to you because of Bob or Bill or like you. They're coming to you because they have a problem that they want solved. And the faster we can do that, we know you can convert faster, more people. And so what Alex is tracking there is his conversion ratio, like how many people come and they Fill out the form. How many people come in, they become a lead, essentially. And when customers come to our sites, they do not care about Billy Bob, who lives down the street and started a lawn care business. They don't. They came to you because they found you on a Google Ad, they found you on a Facebook ad. They saw your trucks going by and they're like, oh, I need my lawn cut. And they're wanting to come to get their problem solved versus if I'm going to a social media influencer site, the first thing, if there's a video from them, I'm going to watch it because I just came from another video of theirs about them that showed their face and their likeness. And so I would say it's much more. If you go to an influencer's page, it's kind of like almost an upsell. It's like, hey, you went from my free thing to, you know, now, now you're going to become a paid lead. Whereas our customers, it is, is they have a problem and they're coming for the solution without any intermediary. Like, they do not know Mike Andes from Augusta longer. They just have no idea who he is. They don't care who Bob from Augusta is. Bill from Augusta, Jill, no one. And so this is in part, very small part of what I'm trying to build Max, because if we can build Max into the Augusta frame, the branding, that would then have some legs. And that is like Max being more and more prevalent. Like the trucks, he's answering the phone, he's in the advertising, the logo, et cetera. But as time goes on, he would actually become the personal brand that is the Alex, that when they come to the site, it's like, oh, I recognize the dog. And the dog could talk to them, for example. But that's what just keep in mind. Yeah, I saw the exact same email from Alex and I have tested this at Augusta with my location putting a video of me explaining why I started Augusta, what I do for the local community, blah, blah, blah. And conversion just dropped off a cliff because customers are coming there and they're like, I want to do business with you and I just want you to take care of my lawn. So I'm not opposed this 100%. Like, I. It's just like there is no.

Affiliation with Augusta and a person right now. And so having a picture, a video of a person when they get to the site is very confusing.

Yeah, I'm really opposed to getting about us on the homepage of most home service websites. Like, you're not trying to build a personal brand in your local community. If you are, that's a different subject. I would also then, you know, say, hey, like, you probably will never not be able to show up to estimates you'll probably not be able to show. Like anytime a customer has a problem, they will contact the person that they watch the video about on the homepage. That's how they were part of the local community, et cetera, et cetera. It also really ruined the brand, like the whole brand of Augusta. The thing that differentiates you from every other competitor in your market is the fact that you're part of a national chain. And so when you have a very personalized brand, when they come to the website, you become one of all of them. In the fact that, yes, people will buy from, you know, people in the local community and et cetera, et cetera. I agree with that. That's why we have certain elements on the homepage, value, it's locally owned and operated, etc. But, but in terms of differentiation, if 40% of the market would prefer to have a company that's backed by a national brand, you are one of one in your market versus one of 50 other competitors that are trying to go after the, the local brand. And so also this would be get really, really hairy because I guess there has to be an arbiter of who is going which videos are allowed on the site. And that would have to end up becoming corporate because you do not want your, your owner next door putting up a video on their site saying something different or that you don't really agree with or that you don't like the professionalism of their video. So it has to be standardized. And I do believe that the, the customer we really want to go after that doesn't have any other options in most of our markets is looking for that cohesive brand image instead of the uniqueness and the locality and everything that every other one of our competitors can provide.

Marcus from Redmond, I hope you crushed your TV interview. We look forward to seeing that. I am pre approved for a $23,000 business line of credit from American Express. I also want an Amex card with a $22,000 limit. I am going to grow a lot next year, but I don't think I' to take on any debt based on my projections. You said it's always a good idea to have a business line of credit in any case. In case of a rainy day, would you still advise I get this line of credit even though I don't think I'll need it. If so, should I ask for more than a $23,000 line of credit? For reference, business size is 440,000 revenue this year, $100,000 cash on hand going into next year, which should be planned to grow to the $800,000 revenue goal. One more question. What is really the difference between a line of credit and normal credit card? Okay, great question. So.

To answer your last question, like between a line of credit and a normal credit card, there's really not a lot of difference because they're both, assuming they're both revolving lines of credit, you can use them and you can tap in and out of them all the time. A credit card is super easy to be able to transact versus a line of credit, which is a actual, like you could call it a loan from the bank that you're usually going to move in and out of your checking account. So you can't go to a, a restaurant and pay with your line of credit. They're going to require credit card. And so think of it just like harder to access. And that's literally like you can't use your line of credit to go pay for something, but you can move money from your line of credit into your checking account and then use that checking out to pay off a credit card. So it really is assuming it's a revolving line of credit, which means you can use it over and over again, pay it off, use it again, pay it off, use it again. It's really the same thing as a normal credit card. Usually your rates are a little bit better and typically you're going to have with it a line of credit. You're usually going to have some sort of collateral. That's how you're going to get the percentage down. So normal credit card, maybe you're paying 22, 23% interest, but then if you collateralize, say your trucks and your equipment on a line of credit, you might be paying 9, 10% interest on that business line of credit, assuming it's backed or secured by assets.

In terms of here, it depends on your fees. If they're charging you more than 1%, don't. I would not open up a.

Line of credit just for the sake of opening a line of credit. If they're charging more than 1%, I wouldn't do that. Some banks, depending, like local credit unions, for example, those, they'll have lines of credit for free. There is no fees. They only make money on the interest. And I actually prefer that. Assuming you're not going to use the line of credit a lot. If you're going to use the line of credit a lot, like the 1% is fine. They're making their money there. They might have their percentage down a couple percentage points. I would rather have, in the perfect world, unsecured line of credit, which means I don't have collateral. And then secondly, I would have no fees, like no annual 1% fee. For example. Sometimes banks will charge that. That's in the ideal world. In the more, you know, more common world, we're going to need to probably collateralize the line of credit to bring the rates down to a reasonable amount. And then you're also usually going to pay like half a percent or quarter percent or sometimes up to a 1% fee per year to keep that line of credit open. So I don't. The higher that percentage of fee goes up on an annual basis, the less inclined I'm wanting to get a big, big, you know, line of credit. Usually credit unions now you only pay like a fee on new line of credit. So for example, I had like a $50,000 line of credit, so I paid 1%, like 500 bucks. Then I moved it to 100,000, but I didn't pay 1,000. I paid another 500 and then I made from 100 to 150 and I paid another 500. So sometimes that's how they make their money too, is like whenever you increase your line of credit, you pay a percentage of the increase. I'm okay with that because now I just keep my 150 line of credit. It just sits there. I don't use it. And I think I had to keep it active one time. So I feel like a dollar in and a dollar out. So I pay like a penny of interest over the course of that month. So I do recommend it. It's an insurance policy, especially if you're going to double the business next year. It's a cash cushion in case something crazy happens during the middle of spring rush when you're like in massive. You buy a couple trucks, you hiring people, you're marketing. You just don't want one, you know, crash of a truck or one employee doing something crazy to really put the business in a bad spot.

Jake Snyder from Rexburg. Question about mowing profitability. This year, about half of our revenue was from large installs, mostly new lawns where we are installing everything from sprinklers, beds, sod, etc. I'm debating no longer doing these large projects. We are already getting large estimates for large installs that we would be Starting next spring. So I would need to decide soon. I'm thinking we need to at least double our mowing base next spring to make this transition worth it, which I think is doable. All right, that's a, that's a big piece right there. I've heard many guys say online mowing is the least profitable service in our lands in a landscaping business. And to be honest, I don't know my numbers well enough to know how profitable our mowing is currently. What's your opinion on mowing profitability? Would it be wise to try and get it to 70 ish percent of revenue before.

Revenue being mowing? When it comes to our locations, what percentage mowing and what percentage cleanups small projects are you shooting for addition added info? To my knowledge, we're towards the top of our market. $75 per hour for mowing. I don't think we could raise that for a while in growth mode if you wanted to double our mowing. Right. We also have to bag clippings, which reduces efficiency. Thanks. Oh yes, Jake, I apologize. Welcome to the world of bagging clippings. Okay, so a few things first, usually when you're first getting started, you're going to have a higher percentage of project revenue simply due to the fact that one or two projects can make up the equivalent of four or five year round mowing customers. In terms of just size of the revenue, like your revenue per mowing customer might be if they're just doing mowing $1,000 or $1,200 a year, one project might be $10,000 and therefore the equivalent of going and finding 10 mowing customers. So it's very normal at the very beginning to have mostly project based work. Also, the locations that grow the fastest usually do a lot of big projects. And then as time goes on, they start realizing, okay, the management of these projects is causing me to literally lose my brain. They're tired of working on the weekends. They're tired of jobs going way over schedule, way over budget. They're having a hard time finding laborers that can do the more skilled labor, et cetera. And then they start slowly chiseling it away. I personally, Jake, would not chop your projects out. What I would do if I was you is I would increase my prices on project to the point where if I get the job, I'm thrilled about it and I'm going to use that money to then go get more mowing jobs so that I can get to capacity using mowing and at capacity raise prices to make it profitable. Most people that say Mowing is not profitable. They are right. And the reason for that is because they are in growth mode and they have never hit capacity. They still have three trucks in the shop while two trucks are out working in the field. And if they ever actually just got to capacity and then raised prices, they all of a sudden change their mind because they realize that they a good job, they're price and the customer is very price insensitive to a 20, 25% price increase for mowing. And so for projects, I'm not opposed to them, like let them come in, I would make the prices high. It sounds like you're also, you're booking jobs way out into the future if you're already booking next spring. I would personally use projects. If you can do them throughout the winter, it sounds like that's what you're doing. I would use them as a way to also fill in your off season. Like you don't need a winter track necessarily if all you do is book out into the book your book from the rush, when you're doing tons of mowing. And when your projects come in, you book them for the off season. Like, I would look at this as like twofold. One, you can look at projects as like your money and just raise prices dramatically because you don't really want them. And then you take that money and you put into marketing and you fund more marketing for getting to capacity for mowing. Secondly, just use it as a way to fill in the off season when mowing it isn't as busy as. So I wouldn't say no to them. I wouldn't like can them or anything. I would use them as a way to then funnel that money towards marketing, slowly increase the recurring revenue percentage base of the business. And then you have options. Either A, you like, hey, okay, I'm going to reduce the amount of projects or B, I am going to hit capacity with my mowing and just raise the prices even more and make it really profitable. I'd probably do it in the same moment. So what I would probably do if I was you, Jake, is next year I would probably raise my prices on projects because I don't really want them according to what you've said. And then the extra profit that I make because of that price increase I would funnel over towards marketing to mowing. Because if you're gonna have to double mowing, it's gonna take a big chunk of you're at lower prices, you're in growth mode kind of on the recurring side. You're gonna do marketing, et cetera. But if you have the money to go spend on marketing, you could probably get there pretty quickly. I would imagine throughout one spring rush you'd get to capacity. You when you hit capacity is when I would raise prices on mowing and at the same moment in time you'd have then the flexibility financially to know that if you pull back on projects a little bit you're going to be just fine. So yeah, I would use your projects to fund your recurring mowing and maintenance marketing efforts which would then bring you to capacity. And then you have to actually make the decision do I go get more trucks to facilitate the projects or do I cut the trucks out? Or do I cut the projects out, move those landscape trucks into mowing trucks and then increase prices. And like there's no right or wrong answer. It's like how do you want the business to run? What is it? How does it serve you that that's what I'd be more focused on? Mr. Anonymous.

Corey posted something about picking people picking up more phone calls from iPhones versus Android or another provider like Google Voice, Grasshopper, et cetera. I personally use Google Voice, my personal phone number for follow up calls. Have you seen any validity or data to support people picking up more or closing more work on iPhone versus other methods? I have mostly because a lot of these Grasshopper and voip phone numbers they usually say spam detected or like spam.

Spam likely or whatever depending on your phone carrier the pickup maybe a little bit more. It's the text messages. If you're doing personalized follow up and texting them, it has a blue bubble. They know you can't send that from an automated source. There's some bots that can get an imessage. It's very, very rare. Usually when you see a blue bubble you know the person's actually texting you. But in terms of pickup there's a slight increase. Yes, because you're not going to get the spam detected. It will say unknown but it's not going to say spam detected or spam likely or some call like phone calls won't go through if that is been detected by the, the the phone carrier. And a lot of times has nothing to do with you or how you've been doing using your phone. It is simply it's a coming from a VoIP VoIP voiceover Internet Protocol phone number which is like a Grasshopper for example. Google Voice will definitely get that tagged 100%. They're notorious for being used for all sorts of, you know, scam related things. So like they get hit all the time. So if I was you, like, look, you can test this out somewhat. Use your own for a while and see like do it for 10 and see if it changes anything. And if it does, then go get another phone. For example, once you start getting more phones added to your phone line, you're looking at like 40 to 50 bucks a line. So I think I have like, I forget how many phones you have the 10 and Verizon before you have to change to a business line. And inclusive of an iPhone 14, I paid $45 per month, which is not bad, is unlimited, you know, SMS and, and data. And if that can increase someone's close ratio by 5 or 10%, like that's the best money you'll ever spend. Because 5 or 10% of a hundred leads is 5 or 6 jobs a month and one lead, if one lead closes, there's my $45. And so if you think of it from that perspective, it's like, oh, 45 bucks, 100, let's do it. But test it like, you know, do do 10, 15 follow ups, see if there's any change or increase in pickup or response rate on text or close ratio and then a pivot from there. But I would say again.

One estimate being accepted, that would not otherwise you paid for your month of, you know, customer acquisition cost, let alone the profits that come from that job. Right. You could say one job a year that gets paid and you make $1,000 on it. You just paid for your phone for the whole year. So I think it's definitely worth it. I'm mostly thinking about winter services because I want that conversion as high as. And so I want texts going out that are blue bubbles. I want videos that are sent through imessage recorded on loom, but then sent through imessage as a video to be extremely organic. Like, I want that just no, nothing exhausted in terms, no stone left unturned or, you know, resources left unexhausted. So. All right, everyone have a fantastic Wednesday and we will see you all tomorrow. Take care.