Mike Minutes Mastermind 11/08/22

Hey, everyone. Hope you're doing super well. Let's go ahead and get started. I'm just over in the other side of command center today. We have meetings on my side today. All right, let's jump into questions. I saw there were some long ones, so let's jump right in.

Cool.

Cool.

Sweet. All right, I think. Oh, I forgot to post this. One second. Let me just go ahead and post this YouTube link. Facebook's changed the way that they do these live streams, so I have to.

Do things a little differently now. Okay.

First question comes in from Max. My Google Ad is showing 37 conversions, but I'm not seeing many new estimates appearing on sa, either OTP or Drive By. Do you know what may be happening? You need to see where your conversions link is at. So.

For example, the one that you gave me, Max, and the one that you can add on your dashboard so specifically is probably going on your home page. You only want it to be on your thank you page. That's going to be a more accurate depiction of a actual conversion. So I don't remember, to be honest, with your email and us setting that up, but if you. If you send the Google link, the linking software from Google, and it goes in your footer or your header, it's going to track any sort of traffic to the site from your ad as a conversion. It doesn't know, actually if someone submitted an estimate. It only knows if that tag was ever read inside the code. So it just needs to be on that one page. So, Max, if that specifically is. If you. If your clicks equal your conversions, that's what's happening. Email me again and we'll make sure that what that code is only on your thank you page, and that is, you know, thank you for submitting an assignment request form. We'll get back to you and set that up sort of thing. So if your clicks are equal to your conversions, please let us know and I will adjust that. All right, let's keep moving along.

Is it worth experimenting with influencer marketing? Seems intriguing, but I'm unsure if many of our target audience are actually following influencers. Yeah, that's the whole point, right? And so I think what's more impactful is potentially in your very local market, if there's people that have a high amount of impact doing stuff for them. For example, people that have like 2 or 3,000 followers on Instagram or Facebook when they post something on Facebook, everyone in the school, everyone, all the moms in the local area are commenting on stuff. Everyone at the country club sees Their posts on Facebook, those would be interesting, saying, hey, I'll do a. I'll give you a free cleanup if you make a post about Augusta Lawn Care. That might be of interest. But it's never going to be an influencer. It's going to be a micro influencer in your neighborhood, you, in your city. Someone who's like on the. What's it called, the pta, Parent Teacher Advisory or whatever, and has like every single parent in the city that is following them and watches their content and their videos and their posts they make. Those are interesting influencers. And I would be more inclined to just reach out to them and be like, hey, you know, we see the impact you've had on our community. We'd love to give you a free.

Service of X, Y and Z in exchange for a review of your. Of our services publicly. Something like that might work. Honestly, it's just a little different because those people have never been. They're not influencers and they don't. They don't know it's like to be approached by brands. If they have 2,3000.

Followers, though, in your local market, that'll have a way bigger impact than trying to get someone who has like a national following. Right. You gotta remember, out of the whole population of the United States, we're all trying to target like 0.01% of the population. So getting someone who's national only works when we have so many locations that we do something together. And that's the only time we would ever, you know, pull pool money together. Like, hey, if we want to do some sort of national thing, I don't think there's an influencer that I know of that would have a big impact on our target audience around landscaping. It's not like there's a lot of people that are well known for, like, landscaping. It's not like, like home improvement industry, like home improvement shows would be the closest thing to an influencer. Like if you had like the gains couple or something like that, like, that'd be the closest thing to it that I feel would be in alignment with our audience.

But I don't see the return on that. I think the return on that is much greater going after someone with 2,3000 followers in your local community that's super connected with like country club neighborhood. They're the board members. Those are the people that you probably are your influencers and are going to have the actual, the biggest impact in your actual.

Financials. All right, this is the one I think I saw. Yeah, long, long question. Okay. Great, let's go. Hey Mike. I don't have a great outlook on next year. I tried to grow again this fall and it was a failure. Okay, let's call it a learning experience. Our lead flow and overall revenue is down for September October and it's looking like November will be the same. I did more revenue with just two of us last year and the leads never slowed down. I keep in mind, Nick, in your. In our market we did have a weird October that had no rain and so everything is going from death like dead brown to frozen. It's been very strange.

I've talked with two other players in my local market and they experienced the same thing as well as four other franchisees experience the same thing. We even had a huge storm come through last weekend and trees and branches around everywhere and we haven't got a single call. I tried to grow in September assuming there would be a fall demand and actually ended up with less profit because I've been trying to keep the guys busy anticipating a rush, but it never happened. The newest guy's last day is tomorrow. Then it's back to two of us. Sorry it was long winded, but it really looks like we are in for a rude awakening next year. It's hard to stay optimistic when my daily reality is pointing towards a negative trend and people want our services and being able to afford them. I actually think next year will be worse for trucks in a truck if unemployment goes up because they will need work and they'll actually get away with charging 50 to $60 an hour. I don't have any any big competition here but hundreds of chucks in a truck. I see new one every day. I'm sorry this was so negative. This is just what's been going on. Why do you think next year we'll have lots of demand when all signs indicate that that's not where we are headed? Great question.

Chucks in a truck are never the driving.

Trucking a truck is not going to make a big impact when you have a economic recession. The reason for that is because they might do 20, 30 lawns in a week. Well, you're going to have the most impact is when someone's doing four or 500 lawns, pairs down to 100 or goes out of business. That is where the real impact will happen. Not in more trucks than a truck. I don't. There was during recession lawn care companies, cleaning companies. Actually more trucks in a truck start because people get unemployed. As unemployment goes up. Typically people start. That's why like in March 2020 there's a whole bunch of people that started because they want an unemployment and then they went and started mowing lawns underneath the table on the side. So during an economic contraction, typically you will actually see more truck and trucks. What you will see though is, is you will see the larger companies will pare down cause they can't find employees like we've seen over the past year or they just financially are not making it and they'll go out of business. That's where the opportunity lies. Because the customer that goes for the chuck in a truck is probably not going to go for our services anyways because they don't see the value of our services. Right. Remember, we are not our target audience. Your mindset that you're talking from here, Nick, is the mindset of a 20, 30 year old that is looking at value based upon price. When you're thinking about someone who has high net worth, people that are insulated from this recession, that customer isn't going to a chuck in a truck. Regardless of what happens in the economy, they want someone high quality on their, on their property. So don't be alarmed by chucks in a truck. They are sucking up all the customers we don't want. What I'm. The reason I feel like there's gonna be really good demand next spring is because so many of the middle level operators that can't find employees over the past year and have been squeezed their margins by inflation and rising fuel costs, they're going to go out of business or scale back this winter. I've seen it like across the board.

And then just remember that like whenever, whenever things get tough, you have to. The reason you have, you have to constantly fight this, this mentality of contraction during.

Economic recessions because it is all over the news. You'll see it all over the place, especially in election cycle. I'm sure everyone's phone has been tech and texting and you get mail about how horrible the economy is and all this other stuff. And so all that fear is what drives people to behavior of contraction. I can't grow my business, I'm not going to hire, I'm going to keep, stay small, et cetera. That is the exact moment in time when you need to do the exact opposite. When everyone is booming like we had like especially in 2021 and everyone was like turning off their lead and there's so much work coming and we couldn't hire anybody during that time, everyone's like grow, grow, grow, grow, grow. It's actually the time to be like, okay, Wait, I'm not going to necessarily be able to find employees, so I'm actually going to raise my prices, get as much cash as possible. And then when times like we're going into now where it's harder to run a business, only the fit will survive. So I really enjoy a time every five, 10 years when this happens because it just, it combs out 30, 40, 50% of the competition that is just not fit for business. And it's a painful time for everybody. 100 of us will get affected by it, but the 60 to 70% that stay in business get all of the customers as we come out of it, right? So.

I think, I think the main thing is your mindset here is that of defense and fear. And that is normal because that's the headlines we've been fed for the past few months. And we're going to see more and more and more of that over the six next six months, right? We've been talking about this for a year, okay? And. And I want everyone to be very clear on the fact that the reason I've talked about for so long is you need to prepare mentally and understand that's the way it's going to be so that when it happens, you're not surprised. Right? No one should be surprised when in three to six months, every news channel saying we're in a massive recession, the housing market's tumbling, we're literally going back to 2008. You're already starting to see it now. But we were talking about this a year ago. The reason you talk about it prior and you get ready for it mentally is because when everyone's talking about is the exact moment you should be doing the opposite of every behavior that everyone else is doing. Everyone else will start contracting everyone else next spring as that's when we're gonna have the rhetoric ramp up of, especially think about from an election standpoint, right? Right now you have peak fear. Everyone's trying to get fear to get votes, right? That's gonna wear off after the election, regardless of which direction things split. If it goes red, right? So think about it after. If it goes red, think about mainstream media and the spin they're gonna want to have after that happens. They're gonna want to make it look bad. And think about also the fact that as we, we've been leading up to this election cycle, you're seeing the unemployment, the unemployment rate stay very, very low. Mark my words. Guarantee this within the next six months, we'll have a month where we lose jobs in America when unemployment starts going back up. And that'll be after the election and it'll be. That will be when everyone freaks out. You're gonna have unemployment going up. You're gonna have year over year decline in the average price of homes. And the stock market is in the toilet and everyone's gonna freak out. Okay, we've been talking about this for a year, and trust me, the rhetoric and all the fear will get worse in the next six months. That is the time to keep buying that. Like the same way that you'd buy stock when everything is low and when you'd sell it when it's really, really high. Like, go back a year when I talked about in October, I said, hey, I'm selling like 60, 70% of my stock portfolio. It's because everyone's like, buy stock. That's the best thing in the world. When everyone's doing it. It's the exact time you don't want to be doing it when it comes to your business. When everyone's like, start a business, it's great. This is fantastic. That's the moment you should be afraid. That's when you say, okay, I'm stacking cash aside here. I'm just going to take things a little bit easier. When everyone is afraid to hire, afraid to grow, afraid to expand, and there's no customers and there's no demand, that's the exact time you want to be going full throttle. And so it's easy to say that. And everyone listens to someone like Warren Buffett that says, you know, be greedy when others are fearful and fearful when others are greedy. And that, oh, yeah, that sounds fantastic. That's why he's so rich. But what they fail to do is apply that in their own business. When over the next six months, you're going to see peak fear and massive amount of people afraid of what's happening in the economy. And that's the exact moment in time when if you can just accelerate during that time and default to an aggressive mindset, you will take way more market share. You hire people that you otherwise would never have been able to hire, and you'll be able to take massive amounts of customers as the upswing comes back in. Right? Because it takes five to six years to get those 30, 40% of competitors that are wiped out. It takes years for them to come back on. We've just had it so good for the past 12 to 14 years. We've had so many, so much competition stack up, they will get wiped out. And I don't mean the Chucks in a truck, they will always be there. It'll be the mid level guys that have been able to just keep prices really high because there are so many customers. They have a six month backlog and they've been doing a bunch of projects. Those are the guys that get hurt in a recession. And so if you think that we're being affected and we focus primarily in maintenance and mowing, et cetera, just wait until the project guys start to lose their shirt because now they don't. Next spring they won't book out six months, they'll book out three weeks and they're gonna, they're gonna freak out.

It's gonna happen. So the reason I talked with such certainty on it is because I want everyone to accept it now so that when it does happen, you already know it's going to happen. You've already made a plan, you already know exactly. And then you stick to it because it's the hardest thing to stick to an investment plan or a thesis or when everyone is afraid and telling you to run for the hills. And so like let's just all accept the fact that we, we talked about for a year we're going into recession. It's gonna be absolutely cataclysmic. We're gonna see fear tactics all over the place, all over the news, all the rest. And we're all gonna want to contract, right? Like, do you think I want to be building a headquarters right now when I know we're going to recession? No. Do you think I want to be selling real estate in order to build? No. But I also know that just playing defensive mode for the next three years puts me behind the curve. Whereas we go offensive during a recession, we can take up market share way faster. I know that I, if I can accelerate the ability to buy software over the next 12 months when valuations are 90% lower than they were 12 months ago, that will set us up for a massive advantage where we want to go software over the next 10 to 15 years. So that's why I'm selling the real estate. There's opportunities when everyone is afraid. And so be very, very vigilant about this, especially you talk to other owners, whether it be inside of Augusta Nation or whether it be outside, whether it be a conference, whatever it might be. Keep in mind when someone else, when you see fear, that's opportunity. It is not the time to jump on the bandwagon. So it's very easy to jump on the bandwagon of fear because it's just a natural inclination for all of us as humans. Do we need to adjust our Google Ads? I heard you talking about Google performance Max or something like that. I haven't adjusted mine since like after watching some of the dashboard videos. Is there a new video I need to watch? I don't know who this is. Give me one second. Connor, if you haven't adjusted since July, I would recommend doing that because you're probably running a regular Google Ad for search only. Performance max is probably going to get you a better cost per click. So I would recommend doing that. It'll take you 30 minutes or so to set that up. Watch the new tutorial and then that way you can have video pictures. It does all the banner display ads automatically and kind of optimizes that for you. So great question, Nick. And in terms of you specifically in your market, I think it's a matter of realizing that.

The spring rush is the time to grow. Yes, you do have sometimes windows of opportunity. In the fall. We had a weird season in terms of a dry October and then poured rain and now it's freezing and the lawn stopped. So very weird for us to have that where we have a dry October. Usually there's rain October and the grass takes off. That didn't really happen this year. So that's going to happen though. That's just part of our industry. We have to rely on the climate. The big thing is realize that this has happened to all of your competition and realize that the mindset of defense that you're playing right now won't serve you well in a recession when there is market share to be had and it is counterintuitive and you'll run on lower margins and it'll be harder to get customers more than ever before. But defaulting to an aggressive mindset during that time, like, okay, look, I, I was able to get four guys. That in itself, Nick, is what you need to celebrate is the fact that you were able to get out of the two person mindset that it's kind of been, you've been stale that for a long time and you went to the five or six or seven, you kind of, you kind of got hurt, but now you felt more in control at 4. So now next spring, my hope is that instead of going to six or seven and collapsing like we did last spring, you're gonna be very confident. Go to 4 or 5 and not stay at 2. That's a good thing. Realize that what happened this past spring, you grew like massive six, seven, eight employees. You felt out of control, okay, it collapsed. You went back to two. Then you're like, okay, I'm gonna go to September. I'm gonna feel confident. Four. You did that. You got to four. You felt very confident on the employee side, which tells me that next spring you're gonna have the confidence to at least go to four people and not. Things won't fall apart. You've gotten the skills of having the four people. So.

Winter services, quick question. I have many in new homes with little to. Not much to do. Only a few shrubs, tiny tree, etc. Come up with other items. I have some ideas. Or just do two to three and then say, see you in a few weeks when mowing starts. So what would Mr. Andy. That's hilarious. So, yeah, this. This is very, very true. If you have new houses, there's not a lot to do with winter services. I would just get creative. Don't be the person that says no for your customer. And I see this all the time I spend. I think it was a Kirk. I forget on the. Yeah, it was Kirk on the Facebook group said he basically hasn't been doing winter services in between mowing. And then, like, starting with services, don't say no for your customer. There are customers out there that want you to show up every two weeks, no matter what, just to blow off the driveway. Like, literally today I went to one of my properties and I. And I was like, I just want them to come here and blow the thing to blow the leaves off. That's all I want. That's all I want them to do. It's massive value to me as a landlord, and the same thing goes for a property owner. So don't say no for your customer because you rationalized how they don't need service. Okay. Figure out how to provide more value on these winter services. For example, I don't know who this is. I don't know your market is, but can you put salt down on their steps? Can you literally shake out their front nets? Can you check their gutters? Just check them. Can you check the bath spots and put the water hose down? Can you ensure that the spider and cobwebs are out of ease? Can you check or, like, put those little foam covers on their outdoor spigots? These are all value adds that cost you very, very little. You just got to get creative. If my landscaper did winter services and on the first visit put those little covers on my spigots, shaked out my. My patio or my front door mat, got the cobwebs off of my. Off the front door entrance where, you know, that starts happening this time of year. If they just did all those things, I'd be like, I'm just happy they take care of this stuff. And if it cost me 40 or 50, a whole lot better than me getting a ladder getting out there. I don't get, you know, I have to go to Home Depot and Lowe's and get these little covers. It cost you like 25, 50 cents to get a cover, right? So the little value adds is what's going to keep that customer. Do not say no for your customer. We all rationalize this based upon our 30, 40 year old mindset that like yes, you can get a ladder and yes, we are all capable of doing these things ourselves. That is not what a 60 and 70 year old is thinking. They are literally putting their lives on the line. If they're 70 years old and they're getting on a ladder to check their gutters, they're literally taking a risk to their physical body. You're providing that service. So don't say no for your customer and rationalize it through your brain that they don't need service. Keep doing services. And if you're running out of things to do, add more value and, and get creative with the two or three things that you said you have ideas, do those things. So, and it could literally be if the customer's not home, you make a quick video for them and you send it to them. These are the type of things you just gotta get creative with.

Also stoked that nearly 50% didn't opt out. Huge win in my book. Let's go. Awesome. Charlie. I'm really actually happy that almost 50% didn't offer. Especially because I don't think last year they did win services in your market. So congrats, man, that's awesome. And that'll dwindle down right after your first month. You usually lose a few and then the month after a few. But again, if you can keep them for that first month or two, you got, you know, if you can keep 40, 50 and if you've never done much service before, 40 is very good. If you, this is your first season winter services, you can easily convert 60, 70, 80% of your customers if you just do it from day one. So cool. I think the takeaway from the day is this is 95 mental, honestly. And I know when we leave training and everything, everyone's hyped and like we all look at the numbers and like where the 10 year goal is for you and your business. But the reason people never get there is because there's so many mental battles that we get into along the way and that is everything from same fear in the economy to employees not showing up to financial stress to ads not working out. There's so many little hurdles throughout and any one of those combined with a couple others on the right week leads people to quitting. The person who can get through those hurdles is the person who will win in the long term. Someone just said they submitted a question and I am not seeing it. Logan I I don't see your question bro.

I only see these three.

If you submit a question oh, there it is. Just popped in. Have a great day. All right. Hey Mike, I'd like your input on the situation we're in. We need two plow trucks this winter. Currently I have one truck with a plow and an extra Boss V plow from a truck I sold this spring.

So one setup ready and one extra plow. The way I see it, I have two options. Either I can purchase mount and wiring harness for truck we have or get a truck with a plow already to mount. To put a mount and wiring harness on P2 truck we have would cost $2,000. I'd put my plow on it and use it this winter. Total cost $2,000. However the other option is to buy another truck with a flower included. I found a 2002 F250 and 175 on the clock comes with a Boss V plow but my extra plow and tells me it's a workhorse. They're asking 9500 if I purchase that truck for H9K. I could paint decal for another 1500 all in somewhere between 10 and 11K. The thing is I could then sell the plow I have for 5k recouping half the cost truck and I would go spend the 2k on the truck I own. Additionally, we have a truck ready to go for the Fremont location next year. My issue with this is I want to keep as much cash in the bank as possible going into the winter. Last year we didn't have a single snow event when we typically have 10 to 12. My word, it was rough on cash flow. I'd like to at least break even this winter, if not turn a profit. And I worry that if we have another fleet winter we won't have enough cash to maintain the winter and expand two locations like I'm planning. Option 1 spend 200amount and harness and have 5 trucks total. Option 2 spend 11k minus 5k all in 6k with another truck ready to go for the spring, 6 trucks sold. Not to mention saving the 2k. I know you have trucks sitting over the winter, but it's so hard to justify spending 2k on a mount knowing full will need another truck in the spring. If that's your last line is the kicker. If you know you need a truck next spring, that makes option two much more appealing. Realize that when a as soon as a truck gets a.

Plow on it, the value that plow, like you said, goes way down. Because the buyer pool of that vehicle goes way down the fact that it already has a plow attached to it. So that's why you don't ever see like if I put a $5,000 plow on a truck, it doesn't increase the value of the truck by 5,000 on resale, it goes up like 2 or 3,000. Because the buyer pool for that, there's not as much demand for it, so you can't get it to full value. So I would reckon auction two thing is 175k. 175,000 miles on a snow truck is also a little bit disturbing, to be honest. But again, if you can get it to work for you for three or four years and that's like your only goal, that's fine. It's obviously a very cheap truck. Obviously $6,000 all in. I'm not expecting this truck to last you for 10 or 15 years. Right. So I would go to option two, though, simply because you said you need this truck in the spring. That being said, what you potentially could do is talk to your insurance and say, hey, we have six trucks now. I only need three throughout the winter. If I disconnect the battery terminals and don't use these trucks, can I save my insurance for the next three or four months? Why I don't use them. This is a for everybody out there. You should contact your insurance agent and see if they let you do this. Different companies do. Different companies don't. Some states have requirements around this. Obviously you want to keep those trucks active throughout the winter, like turn them on, make sure they're running well, et cetera. But if you can promise them you're not going to use them, you could take those trucks theoretically off of the insurance for a few months. Some companies won't allow this. They require you to keep them on year round, like the whole 12 months. But a lot of companies will allow you for three to four months to take trucks off of your insurance. So you can save a few hundred dollars per month on just insurance on those trucks. So contact your insurance agent and talk to them. I've had some companies allow that and some other companies don't.

So, yeah, if you're not using your trucks throughout the winter, I would definitely be okay, which of the trucks we're going to use? Which are the trucks we're not going to use and see if you're. If your insurance agent will let you do that. First year with winter services, only nine residents opted out. It was very surprised at how few opted out. Very cool. Who is this? I always like to know this. Oh, man, I can't see it. Sick.

Okay, I'll look for later. But you know, that's very good. Keep in mind you're probably going to have another five or 10 opt out over the next few months throughout the winter. But again, the fact that you're able to retain such a massive majority of your recurring work throughout the winter is massive. Just in terms of breaking even, right? Because remember, like we talked about before, you have your fixed expenses. Anything above that, that revenue above that is where you make your profit. That's where a lot of us are at right now. Like over the past few months, as that workload gets less, the goal is at least for the recurring services, the winter service, to cover your fixed expenses. If you can stay in this industry and get through the next three months without losing money, massive win. Massive win. And I know that because when I first started, I Remember saving up 70 to $100,000 as we go into the winter, knowing I was going to lose that just because we didn't have enough work as soon as we did winter services and P4P is when I was able to turn it to her. At least the winter we break even. So that's the goal. Great job, Connor. Good for you, man. All right, guys, have a great day. We'll see you.