Mike Minutes Mastermind 10/23/2024

Hello Gus Nation. Welcome to another Mike Minutes Mastermind. Happy Wednesday.

Let's go ahead and get started here. One second.

Cool. All right, let's jump in. Sorry, my lips are all glossy. It's because I got sores in my mouth. I'm trying to put stuff on it. So now with this light just makes it really weird. So worry. I'm not using lip gloss or anything weird like that. All right, let's hop in. Share this.

Boom.

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First question is from Mr. Anonymous. I know this is probably including the seven figure club talks, but would you share quick thoughts about when to bring outside people into the business? When do you need to start having a lawyer, attorney, entertainer? When what is a good revenue to hire, bookkeeping help, a controller or fractional cfo? What other out of organization people are needed to scale to 3.3 to 5 million and beyond? So I don't think, I think it's this matter of sequence. I don't think you need a CFO, lawyer, attorney, et cetera on retainer to get to 3, 5 to 5 million. It's more a matter of once you get to that size, it starts to make sense. And so the reason I say that is because a lot of times when people get interviewed, for example, they're at that size of business, they're much bigger and they talk about how awesome it is to have X, Y and Z person. But if you actually peel back the onion, the reason they got there was usually because they sell really well and they lead people really well. And I think those, those are the two functions of growth. And then once you get to that size you need, it requires you to have those elements. Like I need to be able to have. I have one for the franchise of one person, one real. I have three attorneys. Like at any moment I can email and get help with. But like I didn't do that until millions of dollars in revenue. And like I did not get to millions of dollars revenue because I had attorneys on entertainer. So like even with people like talk about like their, their daily routine and things like it's like that's actually not what got them to the level of success they had if they got to that level of success. And now the luxury to be able to have all of these niceties. So I would be. I just wanted to make that clear.

I think in the MBA for entrepreneurs course, I talk about like your inner circle. I talk about the five people I recommend you kind of have as you scale past a million.

In terms of a banker, a an accountant, a lawyer. I Think I talked about having a real estate agent and like what other people inside that circle, you know, want to be thinking about. And like the banker sometimes you'll have two or three especially if you're going to do like commercial and then you're residential, et cetera. So but that's all like very much down the road. So it's definitely seven figure club stuff down the road. If and when I can afford a full time say cfo, I want to do stuff like we do with Brad. So Brad helps me a lot with my accounting and taxes, et cetera but he also offers a very discounted version of home service CPA to all of you. And so down the road like were a ways off from this but if I was able to have someone full time as like a controller or CFO in house that would be helpful or like other aspects that we could eventually kind of use the community to be able to fund and then it would allow us to be able get one more full time. That's, that'd be cool. So it's basically what I did with Brad to be able to make sure there's a spot for him as he grew out of like the lawn care side of things and he had been working for.

Tax companies a lot doing accounting on the side etc but I wanted to build something for him and then also be able to retain him. So like I create home service epa then he kind of reciprocated by giving a big discount to all of Augusta Nation to do their taxes. And so down the road that'd be an interesting way of me being able to retain like high level people is be able to say hey look like if we can create something for a guest nation that'll help subsidize some of our costs. So instead of waiting till we're at 40 or 50 million maybe I can get someone at 2020 million and then be able to bring them on and make them a resource to everyone here. So it's kind of in the works, in my head way down the road, not a priority. But it's definitely. I kind of seen how it works with Brad. For me I have someone in the office that I can talk to is really helpful but like I can't afford a full time accountant just for our guest nation. But I can afford it if we kind of peace out to the community and are able to kind of outsource the some of the costs.

2 of 8 Mr. Anonymous, what are your thoughts for having a salesperson full time running 3 to 4 sales territory sales while the GM is full time in the field. Would this model work in your opinion? What would the logistics look like in regards to sales for a salesperson, GM regional manager and profit splits between all three, how much revenue, whether the locations need me to doing at least 500k each. This is a good question. So this is actually something we were kind of playing with and tested a year ago at my locations and that is like if I take away sales. So I'm talking about this with the, the training this week for the first time. It's something new we've put into training. And you've heard me talk about sales, operations and admin before, like on the training. But like when we look at like the eventual model that we're trying to build for Gusta and that's like build the 500,000, optimize for profit and build it to 700, $800,000 over the course of a few years. Be very profitable and, and copy and paste that model. When we look at that. What I'm trying to do is I'm trying to think about, okay, from a sales perspective, can I automate everything so that the general manager doesn't have to think about it as much? Like you're gonna have to do projects in person all the time. But can I automate with instant pricing where it gets a credit card on file, it sets them up on the schedule, max AI can answer phone calls, book the job, et cetera. Can I get that automated to where like most, unless you're doing projects, all of it can be automated. Then from a admin perspective, can we make command center to where even once a company scales past 500,000, they do an excellent job at being able to sustain and keep those simple services running smoothly. And the entire admin process can be completely handled by command center. If we can do that, it means that the only aspect of the business that needs to be ran by the general manager is operations. And so this extra overhead person starts to make sense when you have 3, 4, 5 locations and they can spend 100% of their time doing, doing sales. Because even at 6, 700,000, it's not a full time job to do sales. There's days where you only have one or two leads. That's you have a very, very expensive overhead structure. And that's why I like having that size of business where a general manager's in place because they can bounce out with a truck and do some jobs. But if you have three or four locations, you can usually start to make sense of getting a full time Salesperson. That being said, my main like North Star is how do I automate as much of that as possible to where you can say hey look, I'm willing to take 20% less leads because I just don't want to do those project type stuff or I'm going to take them all and do on one day. But then four days of the week I don't even have to think about sales because it's being done via Max AI, it's being done over the phone and it's being done with instant pricing. If we can, if we can do that, this would what I'm about to say becomes obsolete. So I just want to put this big asterisk that as that if you have three to four locations, I do think having a full time salesperson is basically what you're doing is you're taking away that sales role from the general manager and taking it back so they don't have to worry about it. I want to use technology to basically automate that. That's like the eventual goal. But in the meantime I think that this would definitely be something you could do once you have three to four locations. The part about profit sharing, how does this work, etc. I would probably take the cost of that salesperson. I would give them a comp plan based upon like cost per the number of leads they get in close sales. I would do their own comp and then I'd probably split it evenly between the three or four locations. And I would do that for the sake of simplicity that yes, you could do it based upon a whole bunch of other factors. But if assuming all your locations are like either large or in growth mode, which is you're either growing very quickly and you're 2, 300,000, you're trying to grow fast, you're getting a lot more leads or you're in a larger size business doing 6, 7, 800,000, you're also getting a lot of organic leads. So I would probably just make this really simple and be like, hey, you know, the cost of the salesperson is going to be, let's just call it two or three thousand dollars a month per location and they're going to do all your sales. You don't have to think about it. Now. The part that is troubling here or difficult is the general manager now loses control of top line revenue, budgeted hour, accuracy, etc. That's the part you want to be careful of because now the general manager doesn't feel in control. Whereas like instant pricing, for example, the general Manager can change that, and they have a sense of control of that. They can change their OTP price matrix. Like, they can change that. So even though it's automated, they feel like they still control the business. My apprehension with having a salesperson is it controls so much of profitability. The general manager has a scapegoat, and it's hard for them to take full ownership of their role when the salesperson is making mistakes. Like, everyone makes mistakes. They're humans. It's like people are going to make mistakes. They're gonna do under or over budget hours. And then there's a weird dynamic of now that salesperson kind of feels like outside the organization. And then the team and the GM are kind of against them. And I don't mean that in a bad sense as much as when a job goes south and it's budget hours and it's taking 80 now, it's very hard. It's very difficult to take someone who's outside the org that's not with you every single day and not make them a scapegoat and be like, yeah, they messed it up. Like, you know, it's very easy to do that. But everyone's human and everyone will make mistakes. The same way that command center makes mistakes, a salesperson will make mistakes. It's easier to get along with that salesperson when you see them every single day. You know they're part of the team. You know they're fully bought in. When that salesperson becomes kind of an island of themselves doing all the sales. You got three or four GMs and all their crews working. It's easy for that to become. Become a. You know. Yeah, that they're setting us up for failure. They have perverse incentives to make more sales. They're just trying to close more jobs. It gets difficult. So I would be careful with it because I do think it makes it a little harder for your GM to take full ownership of the. Of the position.

And again, projects are the part that that salesperson would really be handling. And I've seen enough this year of like, what percentage of locations are using instant pricing? What percentage of them are closing the conversion rate on them when you run an ad to an instant price form versus a regular estimate form. I've seen enough to know, like, we can automate most of this as long as you're not doing big projects. And I think, like, this coming year, we're really trying to focus instant pricing on snow, winter services, et cetera, coming up in 2025. But down the road, I Have I have several things I've put together of like how, how can you actually automate projects like property cleanups, mult installs, etc. And the technology is kind of getting there, so that's probably, that's gonna be down the road too. Like, my goal is like, we don't have to think about sales, but you have full control of it as a GM, you control the pricing, you can make changes, etc. But then really from an admin perspective, you have command center taking care of it. And then operationally you just have to do, take care of your team, get the job done, efficiently, manage your crew. And so that's like, you know, ideal case scenario.

Mr. Anonymous, two completely unrelated questions. What went in the decision to turning back on ads for your YouTube videos? I'm guessing it has to do with growing cost of the media team. I was just wondering if there was a change of heart, why you decided to, you know, I would have ads off if I could. But the thing is if you demonic if I take ads off my channel, they will just put the ads there and I won't get a cut of it. So YouTube changed their terms of service and basically if you turn ads off, they will still run ads on your channel. So when we, when we had ads off, all of a sudden I started seeing all these ads. I started getting ads on mine. I'm like, what in the world? And sure enough, like, I wasn't making the money, but YouTube's terms of service changed and it basically said they will run ads regardless. So for example, if you're not monetized, they will still run ads on your video and they make all the money. So genius move by them. It's basically a matter of like whether you're monetized, whether you want the money yourself or you just forget to put in your bank information. They will still run ads on your channel. So if they're going to run ads and make a bunch of money on my platform, I might as well get the cut. So I think we get 30%.

I forget, is it 30 or 60%? I forget, but trust me, it's like less than 4% of our budget is from Adsense, so I would turn it off if I could. 2. How do I successfully tell an employee? I tell need them to work on a Saturday? I had an employee that was off for about a week, scheduled time off, came back on a Tuesday and took off Friday also scheduled. We got behind because we had a lot to do last week and I really need him on Saturday. How Do I tell him I need him in a way where it comes across as I expect to do this, but not coming through and.

Not coming through as overbearing or bossy. When I asked him, when I asked them, it felt like I was a dog asking for dinner instead of having priority over most things, like hanging out with friends.

Wait, wait. When I asked them, it felt like I was a dog asking for dinner instead of having priority over most things, like hanging out with friends. Got it. Okay. So realize that there are some people who, like, coming to work is less important than hanging out with their friends, and that's fine. I think that if you. If you gave them that time off, they also got Friday off. So they basically worked like two days this week. One, two, three days this week.

I would. I would just be like, hey, we depends on who this is. Like, how many people are in your team? A lot of this has to do. How many people on your team? Because I think you could have a conversation that would not be confrontational, and you could get them to work Saturday pretty easily, honestly, without begging.

And I would. So, okay, so if I was taking this on, I'm going to assume you have few employees. Like, this is actually a big deal, because if someone missing one day and it's all been scheduled, it's kind of on the scheduler. You know, it is your fault. Like, if you actually want to take ownership of this, it's like, look, this person had a scheduled time off. If everything would have gone smoothly on the scheduling side, this would not be a problem. Again, like, this is difficult because I don't know the size of the business. So I'm just going to assume you only have a couple employees, maybe three or four, and this is a big deal that someone's gone and then now you're way behind. And having them for one more day on Saturday is going to make a big difference. But if you're gonna take ownership of this, this was scheduled time off. This. They got this approved. You approved it prior. I would say in the future, maybe if someone takes that much time off, you say, hey, there might be a chance that if we get behind while you're gone, I might need you to work an extra day or two on the weekend. And if you make that a contingency of the time off, they usually are like, yeah, absolutely. Great, that's fine. But you've set the expectation that it might happen. Okay, now let's go to the day you need them to work this Saturday. I would call them and be like, hey, man, I feel horrible. I really messed up. Like I did not. I underestimated just how much of an impact you make on the team and how efficient you are. And last week we got, we fell behind because we were gone and is it, is it too much to ask? These are the word, the words I would use. Is it too much to ask for you to come in Saturday just to get catch the team back up? That's what I would be asking. But if you take ownership of this, this, these were scheduled times off and you either a mess up the scheduling or the job just went over and like it's not actually their fault. So as much as it feels like you're asking for dinner, I think you can make this in a way where it's like, hey, you gave them something and then you're asking for something in return and be okay if they say no. But ultimately, like it's a scheduling problem and so take ownership of that. I would that be my recommendation and just realize that there are people that like they come to work only enough to be able to pay the bills so they can hang out with their friends. And so if you ask for them to work on Saturdays, you are asking them to deprioritize something that they find more valuable. So I don't think it's necessarily wrong. There's not optimizing for the same thing you are. And so just keep that in mind would be my recommendation. If you take ownership of this, you can, you can sway them to work Saturday. Like if your goal is I need some to work Saturday and you're willing to eat a little bit of humble pie, you will get them to work Saturday. You're going to say something along the lines, is it too much trouble to ask if. Would it be too much headache if we X like coming from that perspective, you, you want them to say no. Like you're not gonna say can you work Saturday? That means yes. I'm going to be saying would it be too much of a headache? Would it be absolutely too like, would it absolutely blow up your weekend schedule if I asked you to X you need. You want the answer to actually be a no? It's easier.

Jeff from Sandwich, Massachusetts. See please see pictures attached. See attached pictures. Looking for your thoughts on where I should work. Should start working on this to get it corrected. I did follow the done view ad tutorial and tracking code instructions. Okay, so these are going to be pictures. Okay. Test your conversion action with tag assistant. Okay. This is Google stuff. It looks like.

Just opening up all these pictures. Okay. So you got holiday. Holiday lights campaign.

Okay. Once you. You will see results here.

Okay, this looks normal.

Once you start running this. Oh, the fifth.

So it seems like it's just not running. I'm guessing that's what you're kind of asking here. I'm not sure what you're asking. One second. Let me go back to your question. I did follow looking for thoughts where I should start working on this to get it corrected. Okay, let me go back to the other photos and see if there's something that seems off.

Inactive. I'm assuming you click troubleshoot.

Okay, so I would click troubleshoot on this button.

This picture right here and see what's going on, why they're inactive. So these are lead forms. FYI, this has nothing to do with the tags. So you're asking the cut. You're running a campaign to submit lead forms. So this isn't going to have anything to do with tags because if you're submitting a lead form on Google, it is not going to take them to the website. So if you're trying to set up tags and your conversion goal is. Is like submitting leads from augustalights.com that's different.

Okay. Yeah. Feel free to book a call with Nick, Jeff. He can walk you through this stuff. But I think right now, if I'm seeing this right, which I might be seeing this wrong, it seems like your conversion goal right now is to submit a lead form. Or maybe, maybe you created that and like this is behind a tag. That could be it.

Because everything seems set up correctly. The conversion tracking is active. Everything is active. This all looks good.

So, yeah, I'm guessing you click troubleshoot here.

Open a new tab. I don't know why. I don't know what this picture has to do with anything. When you're done, close tag assistant and refresh the conversions.

Okay. I am not 100 sure what exactly you're asking. To be perfectly honest with you, Jeff, I'm guessing it's just not running and it's been a couple weeks in progress. I would probably reach out to Google, I would click that troubleshoot button, see exactly what they're saying, because it looks like everything is set up correctly. And just make sure that you're conversion goal is aligned with do you need a tag behind the form, etc. To track leads? That would be my recommendation. So it did spur a question I had. I need to make sure.

Can I talk to the web team about something.

Cool? All right. Yeah. If you feel free to clarify, Jeff, if you need to But I'm guessing you're really. The ad's not running. It's been a few weeks now. I would see what the troubleshoot says. I would contact Google directly and be like, hey, this ad, it says it's right, it's good to go, but it's not running. Why? Because it looks like everything is checked off. And then I'm gonna guess it has something to do with the tags. And so let us know if we can help. If they say like, hey, your tag is in the wrong spot or anything like that, please let us know.

Mr. Anonymous, would you be willing to spend more in advertising and CAC just to solve Q4 collapse? My thought is that I would be interested in doing that just to ensure we don't lose our shirt during winter. Maybe I'm overlooking something. What is your process, your thought process on this? It is a great question. So at conference I'm going to go over the five tracks in a more kind of high level view. And one of them is like, you know, for us it's like sell more mowing. Some locations you can't sell more mowing. However, in some locations you can sell more mowing. Your customer acquisition cost just goes up. So actually determining, like what can you spend on customer acquisition cost actually determines, is determined mostly by your lifetime gross profit. And so a lot of it has to do with can you take a customer that's actually unprofitable during the winter because the CAC is so high and turn them into being profitable because you do, you have greased the wheels to being, to upselling them from a thousand dollars a year customer to a $3,000 a year customer. So we're going to talk a lot about this at conference, but I actually believe is a very valid point. And for example, when I look back at what I used to do to solve Q4 collapse in terms of the amount of money we would spend just to get through and like I would usually have to save up 70 to 100k just to get through winter.

If you just. If I spent half of that, so 45 grand, let's say 45 grand over the course of 90 days, that'd be $500 per day including weekends on advertising. And so the question is, if I would have spent $500 per day in advertising, would I have actually been able to make enough leads to generate enough revenue to break even? And actually Instead of losing 90 or 100,000, I would have lost half of that, but in the meantime gotten more leads, got more work, generated more revenue, kept my guys on etc. So that's a very valid argument. At conference, we're going to break down what is that dollar amount? How many jobs do you need to actually solve Q4 collapse and then work it backwards to what are you willing to pay per customer, actually make the budget work? So it's a very valid argument because you're like, well, if the challenging part is like during spring, you're like, man, I'm getting customers for like 30, 40 bucks a lead. Cool. If that goes to 150, can you actually make it work? Right? Well, I can if I'm closing every single one of them. My close ratio is 70, 80, 90% and I can keep my customer acquisition cost around 200. But if my close ratio is 20 or 30% in the winter and I'm paying $150 per lead now also my cost of customer acquisition cost is 5, 600 bucks. That's a tall mountain to climb. You've got to keep that customer for a couple years, you've got to really increase their value, etc. So there's a lot of kind of things that kind of baked into that we'll talk about at conference. A lot.

Mr. Anonymous, I give 12 to 15% of my income to charity. What are the tax benefits of giving away money? Is that money subtracted from your income or are there additional benefits that we should consider regarding taxes? Yeah. So if basically everyone gets a standard deduction, depending if you are single, married, etc. It's a standard deduction. If you opt out of the standard deduction, you can take things like charitable contributions as deductions, but you have to opt out of the standard deduction. So from a tax perspective, a lot of times for people that give away a few thousand dollars a year, it doesn't make sense to actually take that as a deduction on your taxes. It usually is actually most beneficial to take a standard deduction, especially because that number has increased. That standard deduction has increased significantly since 2020. Actually, I think it was like 2018. So now most people that give away smaller amounts of money and they're actually still better off doing a standard deduction and therefore the donation doesn't actually help them much on their taxes because they had, they would have to otherwise opt out of the standard deduction. And if I'm speaking incorrectly, Brad can correct me in the comments, but to my knowledge, that's how it works. And so if you're giving away 15%, let's just say you're making 100 grand. If you gave away $15,000, you still probably would take your standard deduction because the standard deduction in the US at least this year, USA standard deduction, assuming you are married, your standard deduction is $29,000.

So honestly like there's other deductions you can take though, for example like mortgage interest, etc. But a good accountant is going to look at which of these two routes do we go? Do we go the standard deduction or we take all these other deductions and go the itemized deduction route.

So yeah, just keep that in mind. A lot of people think oh If I get $1,000 away, basically I'm saving 20, 30% of that on taxes. Not really if you're doing a standard deduction. And for the vast majority of people the standard deduction is actually the way to go when you start making hundreds of thousands of dollars in take home income, like you're actually taking this money and you know, that's when usually the standard deduction becomes more prevalently used or sorry the itemized deduction. So again, talk to your accountant. They should, if they're a good accountant, they should be looking at these two I deductions every single year. Like which one do we take? And they usually can make that assessment pretty quickly.

Mr. Anonymous, I had the banner on my site changed to now accepting snow removal clients. Is that, is that all is needed to start ranking for snow on Google? Everything else on the site is still geared towards lawn care. Also we noticed we did not rank on Bing at all anymore. Is that, is there anything we should do be doing to fix that? In terms of Bing.

It literally does the exact same stuff as Google. It's a matter of like certain areas of the country will use Bing More, etc. But like we do not optimize for it. It's the exact same keyword process as Google. They're not doing anything different. They're literally just, they just like fast following Google and basically everything. And so.

In terms of ranking on Bing, if you rank well on Google you're going to like well on Bing typically because they're using the same keyword strategies.

Well, you might want to look at those. Like there are I believe a ways to like create a listing kind of Google listing on Bing. You might want to look at that. We do not create those for you like we do for Google. So if you want to look at that, that might be helpful. In terms of snow, if you would like to add a snow removal page to your site, feel free to email web gustalongerservices.com and they can spin that up for you. The banner isn't going to help a ton in SEO because it's an image, but you can get a page added to your services. Drop down, no problem. Just email webgustalonkerservices.com Mr. Anonymous, is there any clauses we should put in for winter services to prevent someone from signing up for winter services to ultimately cancel after doing a cleanup or a bush trimming? My biggest concern right now is signing up a customer at let's say, $80 bi weekly to have them cancel right after doing what we'd normally have been a $300 bush trimming job. Yes. You're not going to do this, right? So two things. One, when you sell winter services, you can either a make sure the customer knows, hey, we spend x amount of time on the property, no matter what. That needs to be very, very clear. That should be in the estimate. We spend the amount of time that we would typically spend mowing. We get done as many of these things as possible and then we move on to the next thing. So you should never be spending way more time on a property to get it up to snuff. Now, if the property's way behind, what I recommend doing is sell them the $300 bush trimming and then winter services as a way to maintain that. Especially if they're doing it now, like, it's kind of late in the fall, there's a lot of cleanup to do. If someone's like, I want winter services and you're actually selling winter services, I was like, great, we need to get the property up to snuff and the winter services will maintain it and keep it looking good year round. That would be my recommendation, is sell the initial and then the supplement afterwards. Right. So, you know, you're basically upselling a supplement at this point, which is, I'm going to sell you the weight loss and then I'm going to sell you the supplement, which is the, the winter services. So supplements are a great business model because they're ongoing and it's going to keep the property looking good. So I, I need to get the property up to snuff, though. Otherwise you will spend, you know, two months trying to get the property up to looking good. And if the customer's okay with that, they're like, that's fine. Just do whatever you can in that timeframe. That's totally fine. Then you're good. You can just do winter services as long as the crew knows they leave the property after X amount of budget hours, then you're good. But I would recommend if you're selling winter services to brand new customers, get their property up to snuff, up to standard, and then the winter services kicks in and if like, well, that's not fair. It's like, well, look, we're half of the season, the off seasons already started the fault, the leaves have already started to fall. We got to get the property up to where it needs to be at and then winter services maintains that. So it always looks good.

Cool.

Alright everyone, hope you have a fantastic Wednesday. Where's my cursor? There it is. Hope you have a great Wednesday. We'll see you guys tomorrow. Take care.