Mike Minutes Mastermind 12/07/2022

Hey everyone, hope you're doing super well. Quick thing I posted already yesterday on the Facebook group, but for those of you who are using service Autopilot, we did get a further discount from them after a little bit of wrangling and we've somewhat been. What's the word? Stonewalling. I don't know. Since March we haven't onboarded anyone to service Autopilot. So I went to their service Autopilot conference last month, had a talk with them and then a discussion the other day and a phone call. So basically they were able to. We were able to get the cost per user down. I know it's expensive. The monthly fee is still a few hundred bucks to get Pro plus with the automations and everything. But at least we got the users down from 19 down to $10 and then you can get them out of $5 if you buy an annual license, which I would only recommend buying as many users on the annual that you have you use year round. Like if you have people come throughout the entire winter to buy that many annual licenses. So I asked them to have a form that we can fill out for annual licenses and then also a contact. So I should have those to everybody. Hopefully within the next day or two. They move very slowly, but hopefully next day or two I can get that for you to fill out if you want an annual license and get $5 per month, basically $60 per year for an annual license or the night or the $10 per month for the regular. No, no action is required. Everyone's going to go down to $10 per user on the next billing cycle. So no real changes there.

Zooper still has not charged any of our franchisees any money, mostly because they still are trying to execute against their contract with us of what things are required to be done. And.

Yeah, so I have a lot more announcements and things that. What's going on at conference on Thursday. Looking forward to being able to share all of that with you. All right, let's go to questions. I'm also going to be working on some stuff with one click estimate emails and so that everyone can create schedules for your whole year of when your estimates are one click estimate email will go out. I'm gonna be having a meeting right after this with the estimate department about that and there'll be more details on that as well at conference. So you don't. You can just schedule your entire year with one click estimate emails. So it'll be good.

All right, let's present this.

All right, Kyle?

Yeah. Okay, Theoretical case here. Let's say a key member of the business, in your case Lee or Liz, came to you and said they wanted to equity stake in a location of the business or they were leaving, how would you handle that? What is your thought process? I don't have anyone asking, just curious how you would handle. As my quick reaction we would be to say no, but give them something else to manage or sink their teeth into, pay raise, promotion, etc. So a few things.

Let'S see here. So if someone came. So let me first say Lee and Liz both have plans to or are thinking of starting their own locations. I don't really have any problem with that. But if they were thinking about leaving, I would probably have a honest conversation with them because I have enough of a relationship to be like, is this a step backwards in your career because you're going to go from managing 100 locations to trying to manage one or two if they were going to leave over it.

And then even from a money standpoint be like, look, look at your pay over the past X amount of years and see where it's going. That's probably the way I would handle it.

But there's also, people do get bored of positions, right? So whether it be, you know, we're talking about Liz and Lee right here, but any position over time can get boring and someone just outgrows a position and then there's nowhere to grow inside the company. It's not growing fast enough and that's fine. So if they need to move on, like, that'd be fine, right? So if someone's like, look, I just, I need more to handle and there's not more to handle. It's like, look, they might leave and maybe come back in a few years and that's fine.

And. But you don't need to feel obligated to keep giving them more money or creating more things in the business for them necessarily. If you the business and you can't afford it, right? So like I've always said, like, you know, retaining a good employee might be you start a new business, a second location, let them be a gm, whatever. But when the business can't afford it or it's not the priority of you as the owner, then they just need, they need to go find something else, they need to find something better for them and that's fine, right? So if someone asks for more money, there's no more money to be had. That's when you just say like, you just be honest, like, look, you can't afford it and you gotta go Find something else. There's no more higher value tasks for you to do here. And we're not, you know, focusing on that department or that area and then let them move on and maybe come back in a few years. It happens a lot where a company doesn't grow fast enough to, to match the.

Talent of the individual and the individual leaves and to find out that other organizations are the similar fashion or actually was really good where they're at and they'll want to come back. Just leave on good terms and just be open and honest. Like, hey, we can't afford it. We're not focused on that right now. It's going to be a few years before we can promote you into something and just be honest with them. So I think if they were to just suddenly spring this on me, it, it would then be a matter of like, I failed to communicate well with them throughout their tenure, especially because of direct reports.

So that would be my bigger thing. I'd be like, man, I failed to like make sure that they had hard things to work on and like talk about pay and stuff like that.

And yeah, if they wanted more and I'm like, look, we just don't have it. You go work someplace else and then maybe you'll come back in a couple of years if you want. You're more than welcome.

Can you talk more about running Multiple locations under 1 LLC? This is a great question. I'm actually literally having a meeting this afternoon with the bookkeeping department about this very one thing, and that is.

QuickBooks. So we are in this debacle or debacle, this decision making process right now. Do we start new LLCs for every single location or do we do one LLC and then do like four or five locations underneath that LLC? The biggest issue honestly is going to be running them all under different QuickBooks accounts. So when you run payroll, you can't submit separate form 941s and like quarterly reports to the IRS. They want one for one per EIN number. So you can't have like five different form 941s going to them at the end of the quarter. So what that means is you got to do one payment is fine because you can do a journal entry and reconcile it correctly and just have multiple bank accounts each location. Like you can have one business with multiple bank accounts, no problem. But how you do that in QuickBooks is going to be tricky because if you, you have to have different payroll accounts, well, maybe you could do under one account. So we're playing with that right now. I Will have a lot more information literally within probably a week on this one topic. But something I am looking into for those that are, especially when you start doing three, four and five locations, you know what that looks like. Trying to do under one LLC just to save on cost, especially open up multiples at the same time. If you're starting with one per year, you probably should do new llc. You're looking at a couple hundred bucks. It's not a big issue when you're starting like 10 at one time. To start 10 LLC is just a pain in the butt. So. Because typically what I would say is you could do anyone LLC and then just you'd have economies of scale and it comes like insurance workers comp, things like that. And then you just do a journal entry and divide that based upon the percentage of revenue for each location across the board. That'd be an easy way to do it.

But you got to have separate P Ls so that your GMs can have profit sharing. They feel like they actually own their account. You'd have to have different service autopilot accounts, which is totally fine. Or like whichever CRM they're using, you go have different accounts. So that way they, the gm, it's their location. It's not muddled up, it's, it's not confused. And it's very easy for them to feel like they own one location. When you lose that, the GM's position get watered down very quickly. And again, the success of every location will hinge on their GM or whoever's running it. As the operator, I think it's the same question here as what was in the Facebook thing here. Yeah, same one. Okay. Why do you think it's difficult to have a 50% growth in a year, but it's possible expected to have 300 to 500,000 in the first year of a new location in the first year. Oh, okay. I see. You're talking about what I mentioned the other day. So I was not saying it was difficult. I was saying it was the profitability. So what I was comparing yesterday is going from 400,000 to 600,000 versus staying at 600,000 and going to 650. The profit range, the amount of margin you're gonna make in those two different scenarios. I'm not saying that it's, it's, it's difficult or hard. Just going to be. There's more chaos. So when you go from 400,000, 600,000 in growth, that's 50% year over year growth, you're going to have at least one or two more trucks, you have a few more employees, you're probably going to upgrade your shop space. It's going to be a whole other level of a business versus taking that $600,000 business, raising your prices by 10, 15% and making 650 next year, your profit is going to be higher and just going to be easier in terms of managing because you're not trying to grow, grow, grow. Like you go, you're going from you're at 10% growth versus 50% growth. Very different levels of stress when you're growing at that size. The scale of growth is changed that much from 10% to 50%. So I'm not saying it's hard or impossible, I'm just saying it is. There's gonna be more moving parts, there's gonna be more. With growth comes chaos. And so adding employees, adding trucks, buying equipment, financial pressure of all those things happening at 50% growth, very different than taking what you currently have, raising the prices, reducing your close ratio, cutting out services, and being in growth in profit mode. So we're going to really distinguish even at conference, we're going to go over checklists for next spring based upon if you're in growth model versus if you're in profit mode. And so we're really growth mode. Like you're trying to grow fast. Your spring rush checklist will look different based upon if you're trying to grow actively and get more and more customers and like grow 50, 60, 70% year over year, or if you're literally just trying to keep your existing customers, raise their prices and maybe grow your top line revenue by 5 to 10%. That is an easier business to manage for a working gm. If you're trying to grow a business, it's just harder to manage, especially when you're growing 50, 50 plus percent year over year. So awesome. I've been working on my Thursday talk, so I'm very excited about talking to everyone. I want to share on these masterminds, but I got to have some real good stuff at conference. So I'm looking forward to seeing you all and it's going to be a lot of fun. So that's all for today. We'll see you all tomorrow. Take care.