My 2020 Goals and Using P4P In ANY Business!

Hey everyone, it's Mike Andes and you're listening to the Business Boot Camp podcast. Today. I'm talking about my goals for 2020, sharing some of those with you, and answering a P4P pay for performance question that came from the Small Business Owners of America Facebook group. Before we get into today's show though, a big thank you. Today's sponsor, which is Gusto, who has stepped up for another year of sponsorship here in the show, gusto.combootcamp it's only $6 per month per employee and it does incredible things for you and your business. Over 100,000 small businesses has chose Gusto. I'm reading some of these things down here and when there's payroll, instead of it just being, you know, a print off or something like that, you get might from get from your accountant or something like that. It has a great app where the employee is able to see a breakdown of, you know, whether it be their net pay, their federal taxes, their state taxes, and see the breakdown on a very easy to read chart. That along with, you know, benefits, HR and workers compensation, all of that is broken down for them. It's very, very simple to use and I promise you, you will not regret it. Check it out today. Go to gusto.com bootcamp try it out for 90 days completely free using that link. All right, so today we are talking about my goals for 2020, a couple of them at least. And I usually spend about six to eight hours in a day in late December and basically go over all my goals for the following year. And so I'm gonna share a couple of those business goals with you today. I kind of have my business and my personal goals and the business part is broken down in each business. And then I have strategic and like different, you know, and then I work my way backwards. So anyways, this year at conference and then also for the franchisees, I kind of gave pieces of what I do for my goals and I wanted to kind of share that with you. So this is the binder we handed out at conference, but I'm just going to go over what exactly it is. So what I do first is I do this for each of the businesses. I have something similar to this. Not exactly like this, but basically for the year, the macro goals for the year, what am I trying to achieve for the whole year in terms of annual revenue? So I have different breakdown here. I got annual revenue, I got hiring needs and team strategy. I got equipment and trucks. So the reason I put equipment trucks, this was for the landscaping conference. So this is a little bit different on some of my other businesses, but equipment and trucks, cash on hand, eoy, which is end of year. So basically keeping a handle on cash on hand in the bank account. And then strategic actions, implementation of P4P and transitioning, that was something we added for conference. Implementation of open book management, same thing. Delegation process. What am I doing in this year for this business in the delegation process as well as efficiencies and standardization processes, as well as a marketing process. What's the strategy around the marketing plan for the entire year then? What I do and what we did at conference is we go through every single month and fill out that exact same form. So we start at January and we do revenue, we do work through all of those things. What are the strategic moves we're going to make at every single month to get to that end of year goal or marker? Whether it be cash on hand, how much money are you going to have every single month? Because if you're investing in team, if you're investing in equipment, it's gonna take out of your cash on hand. And so really creating that roadmap to entrepreneurial freedom as well as to get to the goals you want in your business is very important. So I'm gonna share some of those that I wrote down this past year and I hope that you do something similar. So you can definitely see these, these are each month. You can definitely customize this to your industry, your business, but you wanna be tracking your cash on hand as well as your strategic moves like buying equipment, hiring, as well as what strategic moves are you making to get you out of the day to day operations. So delegation, having systems in place and what like in here we talk about P4P open book management, standardization processes, but for you it might be what systems are you doing for accounting? What systems are you doing for your inventory management? What are the things that are keeping you in the business, locked into the things that are not moving the needle and moving the business forward so that you can get out of those operations. So those are the things you want to track for the global, the calendar year and then break it down month by month in pieces to get to that place. So I'm going to share some of the things that, you know, some of my targets for 2020 and really just trying to give you an idea of what you can do for your business. This is not necessarily about me, I don't share all of my goals here, but I hope it gives you an understanding idea of sort of, sort of how you want to tackle going into 2020. As you know, we're already a month and a bit into this, but this is planning one on one in terms of goals, setting them and then actually creating a strategic plan to get there. So one of you know, the biggest goals or targets that I have for 2020 is the franchise system. So for Gusta lawn care, getting 30 to 40 franchisees, we really are trying to get to 50 as soon as possible. We want to create a buying co op so we can go out and get bigger brands to give us discounts. I'm really trying to get that. So in 2020, I'm trying to get 30 to 40 new franchisees. We just expanded into Canada so that the Canadians can now become part of the franchise. And that's again part of one of the implementation steps that I had in my month to month goals in 2020, if I'm going to achieve the goal of getting 30 to 40 franchisees. All right, so again, getting your goals are great for the year, but then making each month really step by step actionable steps to get to that place is what's really key. So we just did the Canadian expansion. We have franchisee training next week. Those are things we're working towards as hard. That's probably one of the biggest goals from a business standpoint for me this year. Another goal is command center development. So for the franchisees, we created a separate office that is commit called Command Center. We've been hiring a bunch of people for those positions. It's kind of like a call center. It sends out estimates for the franchisees. It saves them a lot of money in overhead and office staff costs. And so.

You know, if you're not, you know, you're not in the lawn care industry and you're thinking about, how do I do something like that? It's something like a virtual assistant, like someone that is on the other side of the country. They can answer your phone calls, take things off of your plate, begin to delegate those things that are distracting you every day. Your phone ringing, your emails coming in, customers for calling about questions and things that really anyone could answer. They don't have to be in your office. You don't have to actually build an office, rent out an office space, buy equipment, have an insured, have utilities and a lease and all of that. You can get all virtual assistant. So that's sort of what Command center is all about. We're trying to build that out and we've been hiring a bunch, really getting ready for the spring rush for the franchisees. So that that's a big part of 2020 is really scaling that model being, making it very efficient. We're trying to save the franchisees 50% on office staff labor and just the overhead of having a physical office building. We're trying to reduce that P4P system.com version 2. We're developing it for the franchisees where they can basically have a software as well as a mobile app that will completely revolutionize the way they pay people and make it very simple for metrics and all of those things. And I really think that P4P like even the question I'm going to be talking about at the end of today is actually coming from a therapist. I believe it is, yes. A massage therapist. And he's already asked about pay for performance. Like I truly believe pay for performance is going to be a huge part of my 2020 content across all industries. Like I'm trying to prove that it's going to completely change landscaping over the next few years. It's going to do that through the franchise system that we're doing is completely changing the way people get paid. And so I really feel like that's gonna be a big theme of my content in 2020. It's better for the employee, it's better for the customer and it creates efficiencies to where you now have money on the table to pay your employees more as well as be more competitive in the marketplace. Someone was convicting me the other day of on a video I was making about P4P. They were convicting me of trying to take advantage of the employees and trying to hike up prices on the customer and just like make a killing and being super deceptive. They call me a scam artist. Like that's what they were convicting me of. And at the end of the day has nothing to do with that. Because we are more price competitive in our Marketplace because of P4P. Because our guys are more efficient so we can go out and be far more cost effective than a competitor. At a. The other day I got a call from a local competitor. I'm not involved in the day to day operations. I didn't really know what job he was talking about or anything like that, but he's like, like you're half my estimate. And it's because of the efficiencies created by P4P. It's better for the customer price wise and it's better for the employees who now have a target, something they can actually go, you know, shoot for and become more efficient, become more skilled, have more Experience, go home and research and get, you know, learn more skills so they can become faster at their job, become better quality and make more money and give them the opportunity to not have that ceiling of pay that prevents them from staying on with your company, making a career, developing their skillset. Those are things you need to have. So, like, I feel like P4P. I talk about P4P system.com, which we're building out version two. It'll be done by the end of April. For the franchisees, I think it's gonna be revolution, like really, really change the landscape industry over the next two, three years. I truly believe though, part of what my content will be centered around the next several years is how do we change hourly pay in all industries to something around pay for performance? Like, and we're gonna get to about more about that in the question. So I'll kind of leave that for just a second about P4P. But again, some of my goals 2020 is implementing this new software that we're building. It's gonna have a mobile app, it's gonna have a backend database that runs a lot of metrics and things for our franchisees. We're also another one of my goals for 2020 is launching our first CPG brand, consumer packaged Good. And it's a food product, ketosis food ketosiscups.com and so we just launched that got a couple really big orders. We got a food show coming up in Anaheim where we're going to be doing wholesale. Hopefully we get something like Whole Foods and, you know, some bigger accounts and really start getting that rolling. And I'm really looking to learn from. If you know me and you've listened to the podcast for a long time, you know, rarely that I'm like starting a business like make a killing in money. I'm trying to learn something from this. I'm trying to get something out of it the same way that I got Anytime Fitness and I bought that franchise simply to learn the backend support system, the training, how they did their, the financials, everything of their franchise system. So I could use that for Augusta Lawn Care. I'm doing the same thing with Ketosis Cups. Like, it's my first CPG brand that I've launched. I've helped other people and helps with people on the podcast and things, but I've never launched my own. And so that's going to be interesting. Something that can scale, something that I can really test things out with social media, testing that with pricing and really work those offers and really distribution, warehousing, logistics, those things. I can really scale up on those things because as the franchise grows, I'm going to need those skills as well as down the road, like it's going to be valuable things for me to learn. And so that's a big part of 2020 for me is like launching that brand, getting. I don't know what that's gonna become, if it's gonna become a multi million dollar business or if it just becomes a massive learning experience. Definitely not gonna lose a bunch of money. I'll cut it off before that. But regardless, I'll learn a lot from it and be able to. I think it will become a sizable company, something that I do sell off. I'm not gonna be in that business for the long run. It's a learning experience. And so 2020 is going to be launching that, really making it a larger brand, you know, using what I know about branding and marketing and the social side, the website stuff, and launching a CPG brand instead of a service based company like landscaping or even a service based business like a gym membership and other businesses that I'm involved with, online products and books and things like that, like this is gonna be a new field for me to really sharpen my skills on. And there's a lot of things that cross over in industries that you can use like pricing for example, around a CPG brand is. It's interesting the similarities and the parallels that have towards services and making services into packaged products, you know, instead of selling them as hourly and things like that. How do you look at a service based business like a product based business? So really cool things there. I'm really looking forward to learning how P4P can actually influence a manufacturing and sales roles. And so again trying to figure these things out. I'm really looking forward to ketosis cups and what it'll do in 2020. So those are some of the targets and goals that I have for 2020. And again for each of those I use something very similar to this where I have annual goal and then month by month I break it down in terms of the strategic moves, the cash flow moves that I have to make to get to that goal. So let's go ahead and answer a question that kind of ties into P4P and other industries outside of lawn care and landscaping. Because p4psystem.com is for gusta lawn care franchisees. It is around landscaping and lawn care. And I really feel the next two years I'll probably perfect it in that industry and then over the Next probably five to six years. My goal is going to be really to try to help small business owners take out the most fluctuating or variable cost, which is labor in every industry and be able to standardize that and allow to take the price, the ceiling of pay that is keeping people from staying in a small business and going to larger corporations who are happy in the small business environment, thriving. But they have to make that change because they financially have to. They're moving on in their career, they're moving on with their family, things like that. And so how do we actually make small business in America allow them to create careers, allow them to create long term employment by having taking away that price ceiling by giving a P4P pay for performance system. And so I think this is gonna be probably my kind of shtick. But between P4P system and culture over the next six, seven years on all my content to kind of help like I would love to be known or like my identity be wrapped up in the business world in terms of like get helping small business owners switch from an hourly pay system to a P4Pmodel where they take their biggest variable costs and make it into a continual basically a fixed expense of based on percentage. So let me jump into this question. It comes from the Small Business Owners of America Facebook group that we have. Make sure you check it out. Join the group. That's the best place to ask me questions. So I'm gonna read this question. I actually forget the name of the gentleman who put it in here because I copied this into my notes app. But let me go ahead and read this. It's on the Facebook group. You can check it out and hit. My first question is, are there any books I can read about setting up my future employees with a pay for pay would like to be able to have enough work to be able to hire them part time as employees instead of IC's independent contractors. I need the systems in place to keep a steady stream of clients both for in home table massage and corporate chair massage. So there's a steady stream of supply and demand. Thanks in advance, Mike. All right, so really great question here. This is basically like how do I use P4P pay for performance in other industries? Like we're here, we're talking about mobile massage therapists. All right, so this is the thing. When you have a W2 employee instead of an independent contractor or someone that can even do the business themselves, like they have their own LLC and for example a lot of massage therapists, they can be independent contractors because they have Their own little thing, they kind of can bounce around. They do it part time. How do you make them W2s where you're giving them value? You can then hold them to certain standards like uniform systems, timing, scheduling them, things like that, without crossing legal boundaries. So you can make them employees where they want to be an employee instead of an independent contractor. Because you're gonna have to provide value. For example, if you know a lot of people when it comes to P4P are on the landscaping industry, they're like, well, my guys would. If they, if they are making a third or 40% or 25% of revenue, they're just gonna go get their own truck and do their own lawn care business and, and make 100% of the revenue. This is the difference is you're adding value to them being employed under you and getting a percentage of pay because you're finding the customer, you're selling the jobs, you're marketing, you are paying for all the overhead. You're supplying trucks, equipment, labor, uniforms, insurance, everything. Like you're paying for all of that. And then you're giving them a cut. So like, you've got to provide value. And this is the part where it comes like, P4P is difficult for something. Like mobile massage is what value you giving to that person. Because if you're just having a mobile massage person go out and they go out and talk to the customer and all that sort of thing, there's got to be value because that you as the employee are giving to the employee. Because if not, they'll just set up a thing with the customer, like, hey, you come in, I'll come do this on the side and won't charge you as much and just give the money directly to me instead of going to this other person. So you've got to have certain things in place. Like what's that value proposition that you give to the customer and the employee that makes them want to be a W2 instead of of an independent contractor and not want to steal your business and take 100% of the revenue. So that's the first key that you got to figure out. And a lot of times it means you supplying with leads, you supplying the marketing, the overhead, the office space, all of those things that support the business. A lot of times that's what you offer an employee, right? And then the question is, okay, how do you set up a system? P4P is very basic. Give a percent of revenue that they bring to the business. That's really the overarching theme of it all. And then you got to customize it to your industry in terms of quality and making sure that certain standards are met and making sure that that percentage of revenue that you are giving to the employee is sustainable and that you then know what your profit margin is. So at the end of the day, a pay for performance model around any, any industry, you can give a percentage of the revenue. But then again for like massage therapists, you do not want someone to book 12 massages in a day as an employee. And then by the third, by the fifth or sixth one, their hands are so sore they can't get a good, give a very good massage. So you've got, you would have to have certain requirements or certain limitations to that P4Pmodel. For example, maybe they can only do six massages per day. Like that's a cap, a set cap. Maybe you have to have a satisfaction app, an app that gives surveys to the customer as soon as their massage therapist leaves their house or leaves their office. And that rating that is given to that therapist is then a determinant of the percentage of P4P that that therapist gets. Maybe it's on a sliding scale, 30% to 35%. And if they get zero stars but they complete the massage and it is, or maybe it's like this. If it's, you have a sliding scale of revenue going to the, to the employee, that's 30 to 35% of revenue goes to the employee. Let's say for example, it's $100 massage. That employee is going to get 30 to $35 to do that massage plus tips. Maybe in this scenario. But there's going to be a rating system that you give to the customer. And let's say they give 5 stars out of 10. That person would then get 30% or $30 for the employee, would now let's say give 10 stars, 10 out of 10, then that person would get $35. So you do some sort of a sliding scale, balancing out the quality as well as how many massages they're able to kick out in one day. And then you have to be the support back end so that the therapist who loves massage therapy but doesn't want to deal with the business side, collecting money, doing the surveys, finding new customers, setting up appointments, you do all that infrastructure work, then you put employees into it. They are happy to make 30 to $35 an hour plus tips, even though they have to drive between. So maybe it averages out because they're driving from place to place. Maybe it averages out to $25 per hour. Maybe they're happy with that. They're sufficiently happy to do that. They're able to do the thing they love. They don't have to deal with the billing, they don't have to worry about the scheduling, they don't have to worry about updating credit card information, signing contracts for monthly billing, none of that. They just get to go from place to place, do the work. You give them a percentage of revenue and that is a sliding scale based upon quality. Something like that is what I would recommend for a therapist like this. In this situation, you have the infrastructure, the employee wants to become an employee instead of an independent contractor because you offer so many different back end support for them. And then it converts to where they are able to do what they want. That is do the massage therapy. You make a solid percentage of the pay, you know exactly your fixed cost. Instead of having a therapist that you pay by the hour and they spend 20, 30 minutes yapping away with the customer after the massage, you, you're spending money, you're not making anything. On that entire now 60, 70% of that revenue, $100 is actually spent on labor. So these are things that I'm really interested in. P4P is something that can scale across different industries. In terms of a book, there's several different books out there. Not anything to my knowledge around the therapy, the massage therapist. And this is why I want to keep talking about it. I will probably write a book in the next year about pay for performance, how to implement it in really any industry. And over the next two years we're really refining the software to do the calculation aspect of P4P for the landscape industry. So these are just great questions. Thank you so much for jumping on the Facebook group, Small Business Owners of America. In brackets, I think it says business boot camp. Check that out. Go there. That's the best place to answer or ask questions. I'll try to answer them. Thank you so much for joining on today. Listening to some of the goals that I have for 2020. I hope you do the same thing. Start with your annual goals, work your way backwards, month by month, step by step to get to that place strategically where you're going to be in cash. These are things you have to be thinking about as a business owner. Thank you so much for joining me today. I'll see you in the next episode. Remember, until next time, be great because nothing else pays.