The 4 Leadership Hats Every Business Owner MUST Wear

Alright, so every home service business can be broken into 3 parts. And first off, regardless of whether you're doing $3,000 per month or you're doing $200,000 per month, it is broken into these 3 categories. I look at sales, we get the work. Operations, we do the work. And admin, we get paid for the work. And so regardless of whether you have a $3 million business or a $5 million business or you're just getting started, ultimately those are the 3 major functions of a home service business. Get the work, do the work, and get paid for the work. Very simply. Throughout the entire book, I break this down in a bunch of detail because to give blanket advice to every single size business in home services is borderline crazy. Because what I would say to someone that's building a $3 million business or is trying to build a $10 million business or is at $3 million in revenue now is very different than I would tell someone to do if they're doing $300,000, $500,000, $600,000 in annual revenue. That leads me to the 4 leadership hats. So inside the book, and what we're gonna be talking about today is breaking up the 4 leadership hats that you are going to wear as you build a $3 million business. So from $0 to $3 million in annual revenue, these are the hats that you're gonna wear. First off, solo operator. Second, working GM. All right, don't get hung up on the GM thing, we'll get to that in a second. But ultimately this role, you are still out in the field doing the work, hence the working GM. Full-time GM, all right, and we're gonna talk about each and every one of these levels. The main hallmark of this one is you aren't doing operations anymore. You're mostly doing sales and other admin, and sorry, really just sales is your main focus and priority at the full-time GM level. GM Plus, at this level, we are no longer doing sales, operations, or admin. We have now moved into the role of leading the team and we have managers in place for sales, operations, and admin. Now, if you look at these 4 leadership hats, I like to pair up with sales, operations, and admin. And you'll see throughout a lot of the book that there's actually in the bottom right, bottom right-hand corner, there's this little graph that I constantly refer back to to make sure you know, hey, where are we at in terms of what, which of the 4 leadership hats are we covering? And are we going over sales, operations, or admin? So, you know, throughout the book, you can just turn to any page and like, oh, right now we're talking about sales for a business as a solo operator. OK, now these 4 leadership hats, each of them are going to experience sales, operations, and admin very differently. I know that today I'm speaking mostly to business owners. And so your hat that you wear as a leader is going to correspond with the type of thing that you're doing in the business when it comes to sales, operations, and admin. If you're a solo operator, you're doing everything. You're doing the estimate, sales. You're doing the work itself, operations. And you're also doing admin. You're answering the phone, you're doing emails, etc. You're doing all 3 of those things, sales, operations, and admin. As you start to progress into a working GM size of business, now we're usually going to go find someone to pick up the phone, do some email, do some admin and clerical work for us, and we're going to focus most of our time on operations and sales. As I move into full-time GM, now I'm gonna hire someone to go be my operations manager. I'm mostly just doing sales. And then as I go into GM Plus, i.e., I have a manager for all 3 of those, I'm out of daily operations. So in my opinion, when I think about a full-time GM, when I'm mostly just doing sales and I've delegated admin and operations, that's when I am off the truck. And this is what a lot of people aspire to be, and that's why $1 million is kind of like the number of people put on that, that's generally when you can get off the truck and start focusing just on growing the business and getting more work, i.e., sales. If you want to run, have the business run without you, you're likely going to need to find a manager for all 3 of those roles. So when you go on vacation for 2 weeks, sales still happen, you get estimates out, operations still happen, the jobs get done, and admin still happens, the phone gets answered, emails get answered, text messages get answered. So as you progress from through these leadership paths, you're gonna be moving up the value chain from answering the phone to doing the work, and then eventually just doing sales, and then eventually just leading the team. And failing to move up the ladder of value when it comes to admin and then operations and then sales, and then eventually leading the team is what keeps most home service business owners broke. And I talk about the 4L framework, the reason why your business stops growing. It's one of 4 things. It's either going to be liquidity, a lack of liquidity, a lack of leads, a lack of labor, or a lack of leadership. The reason I called it the leadership hats and the reason I was really— when I was originally writing the book, I was thinking I would actually need to create a different book for all 4 of these people because I was like, the 4L framework actually looks different for very different when I am a solo operator? What does leadership mean? What does leadership mean when I only have 1 or 2 employees? What does leadership mean when I have 30 or 40 or 50 employees? Very different. And so originally, I was thinking I'll have to write 4 different books. And I'd say, hey, based upon your revenue size or number of employees that you're managing, go read this book. Instead, we created the leadership hats. And that's what they are. The solo operator, the working GM, full-time GM, and the GM+ model. Now, Quick note, you do not need to hire a general manager. When I say working GM, when I say full-time GM, when I say GM+, everyone thinks immediately that they need to go hire a general manager. The owner can wear the GM hat. The GM is just the leader of the organization. They're the person where the buck stops with them. They're the person that is likely leading the vision of the company. They're making sure they keep everyone accountable, whether they are middle management or technicians that they are managing. The GM, is the leader of the organization, okay? Now, you can have an owner above a GM, okay? But that would be down the road when you're doing multiple locations. For now, the vast majority of people have one location. You will serve as a working GM. You will serve as a full-time GM. You will be a GM+. These are simply labels I have ascribed so that whether you're doing multiple locations or you're doing one large location, the GM sticker label, the leadership hat still applies. So let's go through the 4 different leadership hats and kind of break down the general revenue ranges I see. Now, when I wrote the book, I almost stopped writing it because it almost became impossible to make this useful across different services. Like, if I just go from, let's just call it window cleaning to then concrete, immediately these numbers are all over the place. 'Cause one employee and you doing concrete, you could literally make $500,000 a year or excavation. And you think about complex services, even inside the green industry, like mowing grass versus installing pavers. You're gonna make way more revenue per employee on the paver side than mowing grass. Maybe not profit, maybe harder to scale, but from a revenue per employee perspective, way more on pavers. So I was originally, this really kept me from almost writing the book 'cause I wanted to be prescriptive, but I didn't want to throw anyone into doing the wrong thing simply because I put these revenue ranges on here. So these are revenue ranges, and I think that it probably encompasses 90% of home services. Inside the book, I actually put a list of home services at the very end of services that I would recommend not following the copy and paste method. There's actually a list of them I have made. But 95%, 99% of people on this call today fall into these ranges and should follow the Copy and Paste Millionaire method. So solo operator, $0,000 to $250,000 in annual revenue. Absolutely. There are industries, even ones that don't have a lot of product cost, that do $200,000+ in annual revenue with no employees. All right. You're a solo operator. You're doing sales, operations, admin. You're doing everything. You have no employees. Now, as soon as you hire one person, you are no longer a solo operator. Hence, the word solo is no longer correct for you. We are moving to the working GM. The working GM is typically going to be doing between $250,000 and $750,000 in annual revenue. Okay? Usually under $1 million. 1 to 8 employees. Now, why did I use the 8 employees? Because when you look at leadership styles and you look at leadership training, almost always 6 to 8 employees or 6 to 8 team members is what really is manageable for one person. Now, you might be a unicorn or you might find a unicorn that can manage 15 or 20 people, but it's very rare. And I would actually still build the business in a way that would not require unicorns because finding a unicorn is very hard and very expensive. So I want to try to build a business that if I'm not there, the business can still run. Not just in operations, but I mean, literally, if I need to replace myself to go start other businesses, to move across the country because of a family emergency, because I want to start a second location, whatever it might be, I need someone else to be able to run that. And if it's really hard to find them and very expensive, I just locked myself into this business. Those are the golden handcuffs that many people feel when they're in that $600,000, $700,000, $800,000 range, or they start to go above that, $1 million, $1.1 million, $1.2 million, and they're managing everything. And no, the business cannot run without them. They can't find anyone that would be able to replace them in the business, and they feel the golden handcuffs because no one else can do your job. And if you found them, you would have to pay them as much as you're making, 'cause they have the skill of an entrepreneur. They have the skill of starting things. They have the skill of leading people, and that person is going to be very expensive. So working GM, $250,000 to $750,000 annual revenue. Full-time GM, this is $750,000 to $1.5 million. All right, between 5 and 15 employees. Again, this is ranging because of the different services that you're going to offer across the board. All the different industries. Now, if you look at the Turnaround Show, and I have the exact stat inside the book, but if you look at the Turnaround Show, the majority of people that we actually go help on the Turnaround Show are inside of this range. Why? Because this is the second wilderness of profitability. Usually around $1 million to $1.3 million is where people start having a second wilderness of profitability. What is a wilderness of profitability, you ask? It's the same or similar thing that you experienced when you went from a solo operator to a working GM. Because when you were a solo operator, you were super efficient, you made very good profit margins, and you contributed to the revenue of the business because you were in operations. As you move to working GM, less of your time is spent in operations and more spent managing the team, doing sales, doing admin, doing things that are not actually producing revenue. And so back here in the Working GM phase, a lot of people experience financial pressure between $250,000 and $500,000 in annual revenue. This is the first wilderness. This is why you'll see people that will get their first employee, things are going good, but they get a second, a third, they start going $300,000, $400,000, $500,000 in annual revenue, and all of a sudden they realize they're making just as much money now as they were when they were solo. And so there's a wilderness of profitability, typically between $250,000 and $500,000 in annual revenue, because that's the time you spend less time doing the work, operations, and more time doing sales or admin, i.e., overhead. So you just took your most efficient, profitable employee, you, and you became an overhead expense to the business instead of actually bringing in real revenue. And so that's why we have a wilderness of profitability many times between $250,000 and $500,000 in annual revenue. Fast forward to what we've already been talking about. The full-time GM has a similar wilderness, generally between a little after $1 million. Why? They start getting above 8 employees, 9, 10, 11, 12, 13 employees. They're starting at $1 million, $1.1 million, $1.2 million in revenue, and what happens is now none of their time is spent out in the field and they have to go hire an operations manager. And an office manager and upgrade their shop space. And now their insurance is quite a bit higher because they have all these trucks and equipment. And all of a sudden they have again a profit wilderness because if you hire, if you hire one person and let's just say you pay them a regular salary, let's just call it $70,000. In our state, literally, we can't even pay people less than $80,000 on salary next month. Yeah, January 2026. We can't pay people Less than $80,000. Let's just assume $70,000 as a broad average. Now, by the time you include benefits, by the time you include some bonuses, by the time you include taxes, we're looking at $100,000. Cost to the business to hire a really good operations manager. That $100,000, let's assume you're 25% profitable. I mean, you have to generate $400,000 in annual revenue to cover their $100,000 of salary. Because they're straight overhead. They don't produce revenue like your team members out in the field. And you need them to grow. They are vital. They're very experienced. They typically are the highest paid. You need them to continue growing. However, there's a huge drop in profit margin, profit percentage. And you see this wilderness happen over and over again. And this is why we see cash crunches happen. All right, when we look at the 4L framework, Let me actually try to find the picture for you guys. When you look at the 4L framework, everyone thinks that as you grow the business, you get to the next level in the 4Ls, and that's true. Every time you grow the business, you will get to the next constraint. So if I have a bunch of liquidity and I'm gonna go out and get a bunch more leads, awesome, fantastic, super excited for you. All of a sudden you have so many leads, then what happens? You need more laborers. And then once you get a bunch of laborers, guess what you need? You need more leadership. And that's what's happening at the full-time GM level is you have to go hire leadership for the very first time. And because of that, this is the part most people miss, and I literally cannot find it in my book. That's pretty embarrassing. But the FOREO Framework, the next part people forget about is after leadership, there's still going to be a liquidity crisis. Why? Because I have straight overhead I'm adding to hire these great leaders. And when I hired these great leaders, as straight overhead, I now go right back to the next L of the F.O.I.L. framework, which is leadership. It's a circle. It keeps going. And so because of this, at this size, usually right around $1 million is when people feel this massive cash crunch as they need to hire an operations manager. They need to hire a full-time person in the office. And they see the profit wilderness happen. 5 to 15 employees. All right. The GM+ model. If you're continuing to grow, now you're at $1.5 million typically to $3 million in annual revenue. Now, if you go beyond $3 million, I do talk about that organizational structure. Usually that means you're just starting to add middle-level management. So assistants to your office manager, assistants to your operations manager, and assistants or estimators to your sales manager. That's generally what happens once you cross $3 million. But when we talk about the GM+ model, inside the book, mostly what we're referring to is $1.5 to $3 million in annual revenue. And dependent on your industry and your seasonality, you're going to usually have between 10 and 30 employees. If you struggle with having an off-season in your business and your revenue dropping a lot for 3 or 4 months out of the year, like a lot of home service businesses, I created a special workshop. It's completely free. You can scan the QR code here or just go to mikeandys.com/workshop and it's 3 to 4 hours of content where you'll be able to figure out the 5 solutions to make sure that the winter or your off-season doesn't tank your business. All right. Now, what I want to do today is I want to go through each of the 4 leadership hats, because at the end of each of the chapters, I break down the checklist of what you should be doing if you are a solo operator. So let's go ahead and you guys can bring it to me full screen. And I'm going to go through these right from the book's checklist. So this kind of consolidates a lot of elements from the book. In the form of a checklist, in the form of a checklist of things that you can do in sales, operations, and admin. Usually there's like 12 to 15 checklist items. So first thing for the solo operator, that's what we're talking about right now. First thing is we're going to raise prices to a simple formula that is hourly rate and materials. You can get very complicated with your pricing. At the end of the day, I have an hourly rate. And have a whole bunch of material that go into it. You're like, well, what about all the other cogs? Yes, there are subcontractors. Yes, there are other expenses such as rental of equipment. There are other things that go into quote unquote materials, but the vast majority of us, we have an hourly rate for labor. We sell labor and then we have a whole bunch of other stuff we got to add: materials, equipment rental, dump fees, etc., hazardous waste fees, etc. Keep it very simple. I see so many people listening to someone who is running a $50 million, $100 million business that is doing things with their pricing, and they think that that's what I need to do. No, that's what you need to do if you're running a $50 million business. What you need to be doing is getting estimates out to your customers much faster and not trying to be so precise and getting out your calculator and having spreadsheets and doing all sorts of matrices. And you have this complex algorithm and it's taking you 3, 4, 5 days to get the quote back to the customer. You are losing way more customers than if you just use a very simple formula, which is my hourly rate. How long do I think it's going to take? That's my budget hours multiplied by my hourly rate. That's how much I'm charging for labor. And I'm going to add a bunch of materials into that along with things like equipment rental and other supplies. All right. The other thing that we're going to be doing here, we're going to stop running the business out of your head. And you're gonna install HomeWorks software, home.works. So I saw this the other day on Facebook and someone was kind of bragging about the fact that they still do their estimates by hand. And I'm not gonna lie, their penmanship was fantastic. They still did old-fashioned, like 8.5 by 11 notebook, and they would write out the entire estimate by hand. And I was like, Surely people in the comments are gonna be like, what, are you serious? But no, everyone was supporting them. And I get it, I get it. Everyone's gone very techie and AI and software and it's like, oh, this is refreshing. I get that. But what I care about is the business owner. I'm happy you're serving your customers and they like your handwriting. That's awesome. But I care about what happens in 10 years, 15 years, 20 years of you doing this work yourself and being on every single job site, what happens to you and what happens to your family when you can't do that anymore? And so that's why I believe that software is required. That's why we started Copilot, now HomeWorks. That's why we started it, 'cause software is the easiest way to have things copied and pasted. It's the easiest way for things to be replicated over and over and over the same way, 'cause it's an algorithm. It's literally a piece of code that keeps running. Not unlike having a team member or a piece of paper that could get ate by a dog, an estimate that can get lost in the mail, a check that can get lost. I don't want to rely on that. I want to rely on something that works every single time. There's predictability and it's consistent. That's why I talk about software. That's why we started Copilot. And I'll talk more about that later. Number 3, we're going to collect deposits before starting jobs. Like, this is really basic. If this is really basic to you, it is likely that you are not a solo operator. We will get to your stage, don't worry. But you can't get on a job site, especially larger job sites, and put in labor, materials, time, all of these things, planning goes into this job, and you have no money. No one's giving you any money. You have all these expenses. You paid thousands of dollars for material, hundreds of dollars for equipment rental, and you don't have any money yet. And you're going negative on every single job from day one. and then you're hoping they pay you 30 or 60 days later and you make some profit. I need to cover my cost of goods prior to starting the job, so I never go in the red. This is what leads to a lot of cash flow problems for home service businesses is we don't do this. If you just collect enough revenue prior to the job starting, that allows you to cover your cost of goods sold. That's your direct labor. As a solo operator, you don't have a lot of direct labor. Materials, subcontractors, anything else that's direct labor, I need that covered before the job starts. And the reason I put this as a checklist item for a solo operator is 'cause since you don't have labor, you make sense of not collecting deposits. You're like, well, you know, it's just, I'm gonna work on the weekend. I'll get the whole job done on the weekend. It's only a couple thousand dollars. I don't wanna slow this down. I need the job this, I need to make some money. "Okay, I'll get the job started right away. Forget about sending the check for the deposit, we'll collect after." And you're doing it in the name of good customer service, what the customer wants. No, no, you got to collect the deposit before the job starts. At least 50%, at least cover your cost of goods sold. Now, if you're doing massive projects, for example, roofing, foundation repair, if you're doing tens of thousands or $100,000, there are some states that are going to require you can only collect like, say, 20% or 30% before, and that's fine. But I want you to cover as much as possible before the job starts. And if you are in a state that requires, say, only 30% on larger projects, etc., great, 30% before and after day 1, I'm going to collect the other 20%. I'm going to collect more as soon— like, these are progress payments. As a big project goes on, I want to collect enough money so I never go red. I never go negative on cash flow for that specific one project. This is how you grow yourself out of business. This is how you grow yourself into bankruptcy by big projects and big jobs that you never collected deposit on 'cause you went red. You put money into the job via labor, materials, subcontractors, supplies, rental equipment, all of this stuff you poured into the job. And then either, like, let's hopefully they pay you down the road, but even if they do pay you immediately when the job is done, you had a point in time when you went negative for that project. You had negative cash flow. All right, number 4. The solo operator checklist. This is leadership hat number 1. Track time on every job. Very basic. Again, if you think this is basic, you're probably not a solo operator. If you're not tracking time on every single job, you do not know if you are making money. If you do not know you are making money, Let me save you the time. You are not making money. It's as simple as that. Every single job, I'm going to have budget hours versus actual hours. In other words, how long do I think the job is going to take? And then how long did the job actually take? You must track this. I don't care if this is a 20-minute job. I don't care if this is a 20-day job and hundreds of thousands of dollars. I am tracking. Budget hours versus actual hours. It's the only way to know if you should raise prices. It's the only way to know if you're really making money on a job is to track budget hours versus actual. And to be able to refine your estimating process and your pricing system, you need to know, are we actually accurate on the budgeted hours? Number 5, we're going to send 100% of estimates through your CRM, no verbal pricing. Again, if this seems simple to you, you are probably not a solo operator. But if you are sending verbal commitments or text messaging customers a price and it's not documented inside of your CRM, we are going to have big problems. And it's not that right now you feel that pain. And I'm sure someone in the comments right now is like, I do all my estimates in person. I just tell the customer, I write it out by hand, or I send them a text message all the time and it seems to work fine for me. You're right. It will work for you. But the whole reason we're talking about this is to build a $3 million business. And you're not going to build a $3 million business doing that. And so have— create the discipline and the skills and the habits now that will allow you to get there. So you don't have to unwind bad behavior and bad habits when you're at a million, when you're at $1.5 million. And a lot of what you see on the Turnaround Show is business owners that never instituted these basics when they were small. And now at $1 million in revenue, they still aren't sending their estimates through software. They still aren't tracking their time. They still don't have a pricing formula. Like, do these things basic now so that as you scale, you'll be able to grow without breaking. Next time, next on the checklist for the solo operator is we're going to follow up 3 times On every estimate. You're like, "But I'm going to annoy them." Okay, let's get this really straight. A customer called you or sent an estimate request form in. They need service done. Why do you think they're calling you? Why do you think they're sending an estimate request form? It's not to get an estimate. It is to solve a problem. And the problem is they need this problem solved. Whether it be installing something, removing something, fixing something, maintaining something. They need something done. They have a problem. You are doing them a service by solving a problem. Until you have solved that problem, you have not served them. Like, oh, they called and they got an estimate. That's— I'm just waiting for them to get back. What kind of customer service is that? You haven't solved their problem. In fact, you actually took their time and energy to go onto your website, call you. They had to do all this stuff that did nothing to solve their problem. Until they say yes, until they have a card on file, a deposit paid, and money has been transacted, you have done nothing for them. And so out of a matter of principle, follow up until they say yes. And if they say no, that's fine. I will stop annoying you the minute you say no. If you found another contractor, if you think I'm too expensive, if you need to talk to your spouse, I don't care. I just need to know because I care about you and I want to solve your problem. And until that problem is solved, if I actually care about you, I will relentlessly make sure that I follow up with you and make it as easy as possible for you to solve that problem that you have at your property. If you actually believe that, you'll follow up way more. The next thing is a lot of people have too much fear that they aren't the actual correct or best option for the customer. And that's why they don't follow up. Well, I don't want to be pushy. If you actually cared about the customer and you actually believed you were the best option for them, you would push. The reason many of us don't follow up is 'cause we don't actually believe we're the best option for the customer. You're like, well, I am, I'm not really the cheapest, like, I'm kind of more expensive. That doesn't mean you're not the best option for that customer. If they were going after the bargain basement prices, if they're going after cheapos, they wouldn't have gone to you. Your website that looks super professional was built by Home Service Web Design, and they know they're not getting the cheapest price in town when they call you. They know that. When they see a wrap truck, what do you think goes through their mind? Do you really think they're going to— they think you're going to compete with the $20 guy down the road? But in your mind, you're comparing yourself to the $20 guy down the road. But they contacted you where you say you have reviews and you're licensed and insured and you have a great-looking website and it's mobile-friendly and it loads fast and it looks good and you're— Your trucks are wrapped and you have uniformed employees and you have great social media. And so why are you comparing yourself in your mind to the lowest competitor in your market on one thing, price, when there are a litany of other things the customer cares about? Like the fact that they don't want to see their, they don't want their neighbors to see crummy contractors in their yard. They want people that are professional and uniformed and have wrapped trucks. They don't want their neighbors and the people from their HOA and the people that attend their golf club seeing people smoking and with no shirt on, music blasting in their backyard. So they're willing to pay more. But you, because you think that it's too expensive compared to the lowest price competitor in your market, you stop following up with them because you don't want to be pushy. News alert. They haven't opened up your email yet. They haven't even seen your price. And yet we think that we can't follow up. We don't want to be pushy. We want to be respectful. And here's breaking news. Less than 50% of people, if you're emailing them a quote, less than 50% of people are opening it up. That's why we send text messages from HomeWorks, because I know that immediately my open rate goes from about 35% to 40% all the way up to 98%. Before I let my general managers spend a single dollar on advertising— Facebook, Google, door hangers, whatever— I'm making sure they send a text and email to all of my customers using HomeWorks. That's the CRM we use to text all of our customers a season-specific offer during our off-season to fill our schedule. I go over all of this in the Copy and Paste Millionaire, but right now you can actually go to HomeWorks, home.works, and you can get free texting unlimited until July 1st, 2026. So there's one little thing you could do to follow up is send them a text message. Well, what if there's a landline? What if they, you know, I didn't get their phone number, the number is wrong. Great. That's when you're going to do a little digging and find out what their real number is. You can use county assessor's office. You can figure out who owns the property, get their number, look it up and call them. I'm going to call, email, and text message. Every single person a minimum of 3 times. We do not need more leads. We need to fix our sales process. And we're so concerned about getting more leads in the top of the funnel instead of just focusing on the leads that are in the funnel and they're leaking out of the funnel every single day because of all these leaks. Like, we didn't— they didn't even see the estimate. That's crazy. Okay, next up on the checklist for the solo operator. I want you to get 30 Google reviews as fast as possible. Also respond to the reviews when they come in. And don't get people to lie and say that they did service for you. If you're going to get reviews from family or friends, tell them to review you as the owner, your character, your personality. Don't tell— don't have them lie about what they did, you know, you did not do in their property. Next up on the checklist for the solo operators, book yourself out 2 to 3 weeks in the future and then hire an employee. That's when you get to migrate and move out of being a solo operator is when you hire someone. So I'm trying to book myself out as fast as possible. I'm not worried as much about my profit margin when I'm a solo operator. I'm trying to grow past this stage. And so I'm trying to get 2 to 3 weeks out, booked out on the schedule. And then what you can do, let's just say, for example, right now, end of this month, it's 4 weeks from now. I book myself out for the rest of this month. And then what I can start doing is booking jobs as if I have an employee starting next month. You're like, but that means I have to sell twice as much work. Exactly. And so you have to have the confidence that you're able to generate enough leads, close enough jobs to be able to fill your schedule, but also one other person. The big scary jump from solo operator to a working GM is the fact you have to produce twice as much budgeted hours and labor to be able to get completed. Twice as many jobs have to get accepted. Next on the checklist for the solo operator. You're going to open a separate business checking account. So you're not commingling funds. We cannot commingle funds and then have a $1.5 million business and 3 or 4 years later, someone's suing us. And sure enough, it was from several years back when your business checking account was actually your personal bank account and you're just commingling funds all the time. Separate, you know, separate between the business and your personal expenses. All right. Last on the checklist for the solo operator. Is pay yourself a set weekly draw. Stop draining cash randomly. If you're looking at the bank balance of the business as the determining factor of how much money you take out of the business, we have a problem. We have a problem, Houston. This will lead to chaotic spending personally based upon how the business is doing versus having a budget personally because you have a set amount coming from the business to you And then being disciplined in your personal spending the same way you're trying to be disciplined in the business spending. Again, my recommendation, that's the checklist for the solo operator. Let's move on to the working GM. All right, so working GM is the next leadership hat inside the book. We got another checklist to go over. These are going to cover all departments, sales, operations, and admin, what we should be doing at the working GM size. Number 1, we're going to film estimate videos for every job. Okay, as of yesterday, inside of HomeWorks, you can now attach the videos directly to a visit or a property inside of the FieldForce mobile app. Then you, right from your office, pull that video up and move it to a visit or put it wherever, download it, send it to someone if you need be. You don't need to use WhatsApp, you don't use Google Drive anymore, you don't need to use YouTube, you can do it right from HomeWorks, right inside the FieldForce mobile app that's connected directly inside the software. Now, the reason to do this is because right now, if you're at $300,000, $400,000 in annual revenue, you like 1, 2, maybe 3 projects a week. It doesn't seem like a big hassle to go to each job each morning and show your crew or your employee what they should be doing for the day. The problem is it doesn't scale. And so what I'm trying to do with these checklists is get you to change your behavior now so that your business can grow without hitting a bottleneck. The bottleneck came for me when we were doing around $900,000 to $1 million in annual revenue. And every single morning I was driving around for 2 to 3 hours from going from one side of my service area to the other, to the other. I had 3, 4 projects that I would need to walk through with my crew every morning and just show them the job. They had the estimate notes and they'd be looking at those, but then I would just walk them around the job, 10, 15, 20 minutes. Inevitably, Miss Sally would come out of the house and want to talk to the person that she's already met. That was me, 'cause I was the estimator. So I was the estimator, so they like, "Oh, I know Mike." They came out and talked to me. Well, that's really difficult now for my crew, 'cause anytime something bad happens on the job site, guess who they want to talk to? They want to talk to Mike. So it prevented my crew from taking accountability and ownership of the job, and furthermore, wasted 2 to 3 hours of my morning every single day. So what we started doing is doing staggered start times, 6 o'clock, 6:30, 7 o'clock, 7:30, 8 o'clock for our entire crews. So like the early guys, I'd go show them the job, I'd come back to the shop, show the next crew, then I'd drive the next job, they would have met me there, and then usually the maintenance crew would start last so that way the project crews could be loading up and everything without them in the way. Sounds cool until you're like, wait a second, why are we doing this? Why not? You know what's crazy is then all of a sudden Miss Sally talks to me for 20 minutes and my crew at the second job is sitting there waiting for 20 minutes 20 minutes on me, sitting there twiddling their thumbs 'cause they don't know what to do. They're waiting on me. So now what we're going to be doing at this size of business is working, Jim, we're going to record what the scope of work is for the job before we leave the estimate. We're going to attach that directly inside of HomeWorks to that meeting. Once it's there and it's attached to the property, I can move it wherever I want from inside of their profile. And if the job gets accepted down the road, I will pop that video, right onto that job for the crew to be able to see the video and their notes together. I don't need to show up. When they show up, they know exactly what to do. They don't have to forget materials or supplies because they didn't really see the scope of work beforehand. They were able to watch the video the night before. These are the type of things that will allow the working GM size of business to continue to scale. Next up, use the yellow slip system. It's an accountability system for callbacks and errors. In other words, you don't want to be running around fixing everyone's problems. Now, when I make videos about this, I have made some Shorts about the yellow slip system. I get roasted, roasted online because the vast majority of people aren't business owners. I understand the vast majority of people have never hired anyone and they don't know what it's like when you have 10 or 15 employees and your entire day is spent doing quality control. Your entire day, I know what it's like to be here. Your entire day is fixing the irrigation head that got messed up, the windshield that got broken. Oh, so-and-so did a skid mark. I'll take seed and soil over there. And now that hour-long drive because of traffic and then an hour back and then I'm late. Like, that is you fixing the mistakes of your crew over and over again. And people in the comments are always like, well, that's what leadership is. You got to fix them. No, what leadership is, is allowing your team to grow and get to the next stage of their career and gain skills. Not babysitting them to when they make a mistake, you go fix every single little thing. And furthermore, if they do a great job, I'm going to pay them extra. And we'll talk more about that in just a moment. Next up. Oh, wait. Yellow slip system. Just in case you don't know what it is. If someone calls in, they're complaining, I'm not going to go fix it. I'm going to write out a yellow slip. It's going to go next to where the keys end the day. Everyone goes to the keys and hangs up the keys. And they're going to see a yellow slip and they're going to see the name of the person that did it and what happened and what the customer was complaining about. And within 48 hours, they have to go fix that yellow slip. They have to take it off the board. And usually the next morning or that evening, they're going to go back to the property, communicate with the customer, fix the problem, have the customer sign off on the yellow slip. That yellow slip comes back to that same board and is going to be talked about the next team meeting. This ensures accountability for the job. This is the extra 2 seconds it takes to look back at a job site and be like, Did everything go smoothly? Cool. Oh no, I forgot to pick up my piece of equipment. Oh no, I forgot to trim that bush. Oh, there's a skid mark. I should go ahead and rake that out, blow it out, maybe put some seed down. These are the little things that prevent you from running around like a chicken without a head all day long fixing the mistakes of your crew. And there needs to be upside if they do a good job. I'll talk more about that in just a minute. All right, next on the checklist for the working GM, we're going to train crews to run jobs without you present. 'Cause if you have to be on every single job and you're starting to go from $250,000 to $750,000 in annual revenue, it ain't gonna work. It might work at $250,000. You know, you're the hero, you know how to do the jobs, you're on every single job site, let's go. But at $750, you can't keep juggling everything and you can't do it profitably because you're straight overhead and you can't spend time running around every single job site anymore. You have to train your crew. There's a lot of times we have to kind of clear the board, Reset training and onboarding, making sure there's systems in place for making sure team members are trained up. Next up, number 4 on the Working GM Checklist. This is, if you're following along, page 75 of the book. We are going to route jobs and schedule using a CRM calendar. No more whiteboards or sticky notes. If you've seen The Turnaround Show, there was a business that was doing like $1.5, $1.7 million in annual revenue and still, How estimates were accepted was the admin lady would print off the estimate that was accepted and put it up on the board. And it was like this giant Kanban system of estimates accepted, estimates in progress, estimates that were, you know, sent but still pending. Crazy, crazy, crazy, crazy. I was like, well, how does this work? Like, what happens? Like, who determines when the pending estimates go off the board? He's like, well, when it fills up, like if I run out of space to put more estimates and people haven't responded back to me for a few weeks, I just You know, I just shred their paper and then it's done. Okay. We should not be doing that. We should be routing jobs. So if you have recurring jobs, we're using a routing software. If you are using projects, we're, we're going to make sure we use budget hours to appropriately schedule them on the calendar. This is why inside of HomeWorks, when you're on the weekly view or the monthly view, you're going to see budget hour capacity and how many budget hours are recurring, how many budget hours are one-time jobs. So you can very quickly glance at your calendar, know exactly where you can afford to fit jobs. and if you go over your capacity, it turns red. So it's like, hey, no more jobs in the schedule. We're over capacity. We need that for projects, and we also need to be able to route jobs for recurring using a routing software. Number 5 on the working GM checklist, we're gonna create estimate templates inside of our CRM. We're not going to create custom quotes every single time. Remember, we are trying to systematize our business, and to systematize our business, We're gonna do things that are simple and things that are not complex. Cool. We are also not going to do things that are custom. We're gonna do things that are standardized. So we want simple and standardized. Therefore, I am not gonna create a custom worded estimate for every single quote that I send out. I'm gonna have templates that I can copy and paste in or drag and drop or, whatever from my software to be able to have a reasonable enough template of the estimate notes so I don't spend an hour typing them all up. We were able to, when we did, back when we did paver patios, excavation, putting greens, the whole nine yards, we had templates that we could still make a $50,000 job. The estimate quoting process still only took 3 to 5 minutes because it's like, okay, great. Put that big chunk of text in here with all the exact verbiage, basically a start to finish of exactly how the job was going to roll. And then we're gonna change 3 or 4 things that the customer wanted adjusted, or how many yards of material, or how many pallets of sod were coming in, whatever it might be. We're changing out a few little things, and that's all that's required to be able to get the quote out. So I'm creating those templates at the working GM size. We're gonna fire poor performers quickly and stop carrying dead weight. A lot of times, nice people at the working GM size stall out simply because they don't fire poor performers. It is your job to fire people that are low performers, and it stinks. I hate firing people. As the business has grown, I now have operations people in all the businesses, and they do the firing because I hate firing people. I always held on to people way too long before firing them. But here's what's crazy. I never fired one person that I regretted doing it afterwards. Not one single time. Every single time. I or any of my managers have fired someone within about a week or two after initial, you know, there might be hurt feelings or friendships that people had, etc. But after a week or two, it's like, oh my goodness, that's so much better. And you also hear all the stories of what they were actually doing on the clock. Always amazing how those come out after they were fired. So you got to fire poor performers quickly. It's like cutting out a cancer. Do I want to cut off my arm because there's a huge tumor that's growing and metastasizing inside my body? No. But I must do that in order to preserve the rest of the body, 'cause then my other arm is gonna get affected and my legs and my chest and my head, and I'm going to eventually die. And so a business that doesn't cut out the cancers in the organization eventually dies. Full stop. Okay, next up on the checklist for the working GM. We're gonna document your top 5 admin tasks and delegate to a virtual admin or seasonal office staff. So the things that are taking your time, I will save you some time by telling you what those things are. Number 1, if they interrupt you while you're working, delegate it. At this size, the working GM size, $250,000 to $750,000 in annual revenue. You're like, "Oh no, no, no, I'm going to go out and I'm going to delegate and find an estimator." Nope, that's the highest leverage task in the business, and 99% of the time, the entrepreneur is the best salesperson. And so, I'm going to delegate the lowest leverage task first, admin. And that's where I'm at as the working GM size. I'm trying to do this in a way that I don't need a full-time office person. I can't afford it. I can't afford the shop space for them to be in. Is it nice? Yes. Is it great? Is it more custom? Can I get everything the way I just want it? How I want it done, how I want the phone answered? Is it easier to manage them? Yes. If they're in person? Yes. But I'm usually going to do a virtual assistant or pay some sort of, answering service or like a seasonal office staff member is great if they can work for you like during spring rush for 4 months when you're completely bogged down with phone calls, text messages, emails, anything that interrupts you throughout your day. You want to delegate this at this time. One of the biggest benefits of joining Augusta Lawn Care is that you get access to Command Center. Command Center is going to do a lot of admin tasks for you, like answering your phones and seeing your email and even running payroll. If those things off of your plate would allow you to grow your business more, go check out augustalawncareservices.com/franchise and see if it'd be a a good fit for you. The reason is because there's switching costs. Every single time you're out in the field or doing estimates, i.e., doing sales and operations, and a phone call comes in, that's admin. It's a lower leverage task that's interrupting you from higher leverage tasks. Good idea to not let that happen. Also, there are switching costs when you go from working to answering the phone call to then doing an estimate with Mr. Jones, and then all of a sudden you get an email, and then you get a complaint, an online review, and then you're going back to Mrs. Sally Junior's because this irrigation thing broke. This chaos is caused for all the switching that's happening in your day. And the reason you feel like a hamster on a wheel is because you're just switching from operation to sales, sales to admin, admin to sales, sales, operation, that you're all throughout the day. And that's fine as a solo operator. That's what you're supposed to be doing. But a working GM, we have to start delegating the lowest leverage of those tasks, which is usually admin and usually The thing you're not good at. The first things I want to delegate in any business are things I'm not good at, the things that suck energy from me, and things that are the lowest leverage. And admin is the lowest leverage. And for most entrepreneurs, most entrepreneurs, they're better at sales than they are at admin stuff and keeping things organized and keeping track of QuickBooks. All these things they stink at. So don't do those. Just focus on being a better salesperson. Focus on being a better manager of your team on the field and operations. Okay, so we're going to delegate those things. 2 more on the Working GM Checklist. We're going to hit 50% of revenue from recurring work. Again, I believe in recurring work. I like one-time jobs just as much as the guy next to me. I also look at who got impacted and scared out of their mind when COVID happened, and for 2 weeks, everyone shut down. It was the guys with the big projects. All of a sudden, their backlog going from 6 months to 6 hours. Overnight. I don't want that to happen. I think I lost at my location maybe 1%, not even 1% 'cause it was like 2 people. So like a quarter percent of our recurring customers canceled when COVID happened. I like recurring revenue. It's something that doesn't leave tomorrow if I leave the business. It still keeps coming in. I don't have to keep getting more jobs. I can actually go on a vacation, not do any sales, and revenue still comes in. That's the kind of business that you can eventually leave. It's the kind of business that will give you ultimate freedom. And the vast majority of us got into this whole thing of business to become free from time schedules, from having other people tell us what to do, to be able to do things that we want. And yet, and yet, because we don't have enough recurring revenue and we're going after big projects from one to the next to the next, we're in this constant hamster wheel. And instead of getting freedom, we get the exact opposite of freedom. Bondage to our business, doing all the sales, making sure all the projects, moving materials and equipment, and then making sure when our admin person's out, like, oh, we're gonna answer the phone calls, and we'll jump back in, and like, it's chaos. Okay, last on the checklist for the working GM, take a set salary and reinvest remainder into marketing and growth. I put this here because a lot of times I see people start buying a bunch of equipment this size, because now they can kind of justify it due to the fact they have multiple crews. You can buy trucks and equipment tomorrow. Every single person here with a credit card, assuming your balance is high enough, your limits are high enough, you can go buy a truck tomorrow. Assuming your credit score is decent, you can go buy a truck tomorrow. If you don't have cash, you can go buy a truck tomorrow. Here's the thing. Anyone can do that, which means buying more trucks and equipment doesn't add value to your business. It just gets you more trucks and equipment. It's just a tool to get the work done. And the reason we buy the truck and equipment is to be able to get more work done. And the reason we get more work done is 'cause we have customers and we have contracts and we have contacts and we have people that we do business with. That is how you build a business. That's where you get real enterprise value, not in buying more trucks and equipment. And that's why at this size, I encourage you to spend the money that you do have On marketing and advertising and a better website and wrapping your trucks, because that ultimately will get you more leads. That'll ultimately be the thing that grows the value of the business. Buy more trucks and equipment is required to be able to fulfill on the work that you sell. But if you have all the trucks and equipment in the world, you do not have a business. You have a bunch of trucks and equipment. All right, the full-time GM. This is the third leadership hat that we talk about. This is on page 109. 1, inside of the book, first on the checklist. This one's pretty, pretty small. Only 6 things. Full-time checklist, full-time GM checklist. Number 1, build an SOP, that's standard operating procedure, library for sales, operation, and admin. I'm going to make sure it's digital and repeatable. So you can do screen recordings for admin very easily. Operations, I'm going to have a checklist for new hires. I'm going to have what are they doing on day 1, day 2, day 3? What are they doing in orientation? If orientation is, here's your shirt, there's Bob, Bob will tell you what to do, jump in the truck. If that's your orientation, at this size, we got to solve that. We got to create operating procedures, standard operating procedures for sales, operations, and admin. All right, so admin digital, I'm going to make sure that I'm usually doing screen recordings for every little thing they do, from routing to scheduling to billing to sending out automations to doing the QuickBooks, checking the email, doing the text message, all of those things. I'm going to do screen recordings for. Operations, I'm going to have checklists typically. I'm going to have some training videos, not too many because usually field technicians don't like sitting down for videos for days on end. I have an orientation process. I'm going to have a hiring process. I'm going to have how do I screen applicants out, etc. All of that, the full-time GM. And then for the sales side, I'm also going to have systems and procedures, standard operating procedures. If I'm doing a door hanger, How many door hangers per hour should I be putting out? What kind of houses should I be putting door hangers on? These are all standard operating procedures. Where do I write the number on the instant quote price? What templates do I use? These are all things that a salesperson should have. And you're building an SOP. You're like, well, I'm still doing sales. I'm in full— I'm a full-time GM. Aren't I doing all the estimates? Yes, you are. But I'm trying to get it to where you can hand this off. And in order to build a business that runs without you, you need to have systems that run without you. You're like, oh, great, find great people. I agree. It's easier to find A- talent and train them up to be A players with systems than it is constantly looking for unicorns that are one in a bajillion that can just create the business for you. Like, well, I have all these leads coming in. I have no idea how to do pricing, no idea how to do sales, but like, we're growing. If you're going to go try to find someone to replace you doing that, without systems, guess what you're gonna be trying to find? An entrepreneur like you. So it's very likely you will probably hire your competitor. Someone's going out of business. Yeah, let's definitely hire that guy. The guy that ran the business into the ground. But that's the only type of person that can run your sales system because you don't have any standard operating procedures. You don't have any sort of automations that tell them, hey, you call them after 24 hours, you call them after 3 days, you call them after 7 days, you call them after 10 days, you make this offer, here's the 5 things that you say on the follow-up phone calls. Here's what the text message is. Here's what the email says. Here's what you don't say. Here's what you do say. Here's what a good close rate is. Here's what a bad close rate is. This is a standard operating procedure that you need to have for sales, operations, and admin at this size of business. Full-time GM checklist, page 101. We're gonna automate invoicing, billing, and collections inside of HomeWorks. Okay, inside of HomeWorks, you can set up to where it automatically creates an invoice, Daily, weekly, monthly, etc. You can have it where it automatically bills, charges the customer, their card on file or their bank account on file, daily, weekly, or monthly. You can just set it up one time in the settings, done forever. As long as you complete jobs correctly, as long as at the end of the day, you kind of do end of day, make sure everyone clocked their jobs, completed them. Oh, this one they skipped, great. We won't be billing them, fantastic. As long as you just make sure things are straight and organized, you should, allow for automated billing and automated invoicing to happen. Little side note: if you're doing daily billing where you're charging every single day, do not send them an email with a receipt every single time. Have them have a customer portal login where they can go see all of their payments in one spot. The reason I don't want to be sending an invoice receipt every single time I charge their card is, number one, it reminds them of a recurring service that I have. And the more times I remind them, the more likely they're going to churn and cancel service. Secondly, more importantly, is I do not want them to get fatigued from my marketing messages, which are going to happen once a month. I'm going to send a mass text or mass email from HomeWorks. And when I do that, I do not want them to be in the habit of archiving all messages from my business because they're used to just seeing receipts. No one looks at a receipt, especially when it's the exact same amount every single week. So don't send them out. Have it where there's a login. If they call in, they say, "Hey, I want to see that." Great. Let me go ahead and text that right to you. Here's a link. Boom. They can open it up, see all their payments. Okay, fantastic. Thank you so much. Let's go. Okay. Next up on the docket for the checklist for the full-time GM. We're doing pay for performance, scorecards, and efficiency tracking across all crews. It's kind of a good idea if the thing that you're selling, in this case, in home services, we are selling labor. If you're gonna sell labor, it's a good idea to know if you're being efficient at selling it. Because ultimately, all of home services boil down to, if you take an hour's worth of labor, whether it be you or an employee, you add supplies, materials, training, experience, et cetera, equipment, and you charge them more for it. So I take $20 per hour of labor that I'm paying an employee. I give them training, I give them a uniform, I insure them, I give them a whole bunch of experience on a piece of equipment, and then they get the equipment and the trucks and all, everything's there. Great. I can now charge, because I've added this value to this equation, I can now charge $100 per hour to the customer. So if that labor that we're charging per hour for, ultimately, he's like, oh, I don't charge by hour, I charge by the job. It still takes a certain function of hours to get the job done. And so if you're not efficient at producing the product, i.e., this end result of labor being efficient, it's probably not a good idea to not know that number. You should track efficiency scores. I very rarely use the word should. I'm going to say it. You should track efficiency scores. Mind-blowing. Home services, the thing that we sell is time. You should probably make sure you're tracking how efficient your crew is. How do I do that? Budget hours divided by clocked hours. So if the job was 8 budget hours, you know, estimated to take 8 hours and it took 10 hours, 8 divided by 10, it's 80% efficiency. In other words, 20% of their day was doing unproductive things like driving, loading up, doing meetings, having lunch break, whatever it was, that was part of the clocked hours. And we'll talk more about what a good efficiency score is, but at this size, we should definitely be tracking it and giving them a piece of the action if they're really efficient. 'Cause who cares what my efficiency score is unless you tie my pay to it. So if you can tie the compensation of your team to their efficiency, all of a sudden it matters, all of a sudden you'll see the needle start to move. All right, checklist item on the full-time GM size. Reduce service menu. Standardize offerings and cut complexity. The fastest way to grow revenue in any home service business? Add service, add service area. The least profitable way to grow revenue in a home service business? Add services, add service area. Here's what's crazy. You will always prove me wrong when I say you should not add that service. You know why? Because if you add the service, you will add more revenue, guaranteed. And I say, I don't think you should really expand another 5 or 10 miles on that service area, and you do it. Guess what? You will prove me wrong because you will get more revenue. It's the easiest way to grow revenue. And for that reason, people wake up with a $3, $5, $10 million business serving massive service areas, doing 10, 15, 20 different services, and realizing they have a horrible business they can't hand off to anyone. So for that reason, at the full-time GM side, that's again $750,000 to $1.5 million in annual revenue. I'm going to standardize my offerings and cut complexity. Next, last on the checklist for full-time GM, we're going to get 75% of revenue to recurring maintenance services. Again, I am trying to build a business that runs without me. I am not trying to build a very expensive Job. All right. Last, GM+. This is when you're between $1.5 million in annual revenue and $3 million in annual revenue and typically having between 10 and 30 employees. Here's the checklist. This one gets a little bit lengthy because this is now when we're stepping out of daily operations. First up, we're going to promote leaders into managers and we're going to develop a leadership bench. All right. This is why we had the stages of success. 21 Stages of Success at Augusta is to turn technicians all the way to owners, and in that period, my only goal is to get them the next stage. Turn my technicians into great managers. Number 2 on the GM checklist, GM Plus, sorry. Cross-train your admin staff to eliminate key man risk. Okay. As you start getting into $1.5+ million revenue, you're going to start getting the second or third person in the office. You got to have them cross-trained. Now, in the book, I talk about when you start developing a command center and you're after $3 million, you start doing the exact opposite, which is you start creating pockets that do certain things. For example, accounts receivable, accounts payable, payroll, HR, answering the phones. These are all different departments as you scale much larger. Again, people hear me say that second part on podcasts sometimes, and they take it like, I'm gonna hire 3 people. And like, whoa, you're doing $700,000 in annual revenue. Hiring 3 people in the office is the wrong move. At this size, $1.5 million, as you cross this, you need more than one person. And by the way, if your spouse is doing all of your admin work and they're the only one that knows how to do it, you have very much key man risk. Okay. If you have multiple people now in the office, after you've crossed $1.5 million, as you're going to $3 million, I need my people in the office to know how to do everything, 20 or 30 tasks typically. Because I can't have one person gone for a week and just no one answers the phone. Oh yeah, Sally does the payroll. So when Sally's out of town, payroll doesn't go through. Good luck keeping your team. And so if you're going to really delegate to people, you need them cross-trained so that if someone leaves, at least someone knows how to go log into QuickBooks and run payroll. At least. Or have— this is why I'm a huge fan of having other services do that sort of thing for you. This is why we have home service CPA to do payroll. Do your bookkeeping, do your taxes, because I really don't want to train that to someone. And I don't want that to be the level of skill required to be my admin person. I would rather just have someone else do it so I can focus on how to answer a phone call and how to upsell on the phone. And when someone has a question about this service, sell them this. Like, I would rather focus my time and energy on that. However, at $1.5 million plus in revenue, you have multiple people in the office, and I would recommend you cross-train them to reduce key man risk. If you do have your spouse in the office, they're going to do a phenomenal job. Absolutely amazing. Just make sure they record everything they're doing. Because what I don't want to happen, and I say this in all sincerity because I see it happen so often, people build very good, profitable businesses and their spouse gets pregnant, gets sick. They have relationship trouble. There's a little bit of space where they need to spend some time away from each other. These are periods of time that wipe businesses out. And no one posts about that on social media or writes a book about what happened in their personal life that caused their business to close down. They don't. They'll blame it on the market. They'll blame it on the economy, employees, etc. And those are all good excuses because I understand you don't want to bring up the fact that because you had some rocky parts in your relationship or someone got sick or there was a miscarriage or some horrible thing happened in life, I don't want you to lose your business over it. And these are why I create systems, because like I see it so often of the time. And so anything that right now is your crutch, the thing that you lean on all of your time and energy on, any person in your organization that you couldn't work without, that the business would fall apart without, is an absolute liability to scaling the business. Number 3 on the GM+ checklist, we're going to create manager scorecards. Okay, so for every single manager, sales, operations, admin, I now have a manager of the department. Again, we're $1.5 to $3 million in annual revenue. For example, operation is going to be labor efficiency. That's our big metric. I'm probably going to have 5 or 10 for each one, but like, that's a big one. For sales, my close rate, very important. For my admin person, there's a lot of metrics here too, like speed to lead, how fast we're getting back to quotes, how often we answer the phone. These are all metrics, but I should at least have a few for each of the managers, and ideally they're compensated on it. I was talking to an owner at Augusta this morning and I said, do they know? We were talking about one of their general managers and I said, hey, do they actually even know like what metrics they should be hitting? Like, well, generally, yeah. Like, and they get, they get compensated on it, etc. I said, how about this? Create a red, yellow, and green, i.e., for every one of these metrics, if it's red, you're going to get fired. And by the way, you don't do this like years into their tenure. You do this during the onboarding and training and before they even get hired. You set these expectations. Okay, red, you're fired. Yellow, good enough. I'll stay off your back. I will not dig into your business. Green, you're probably getting bonuses. That's it. Clear metrics, what success looks like, compensated based upon the success of those metrics and hitting benchmarks. Red, for example, let's use close rate for a salesperson. If your close rate goes to 20% or below, you're fired. Straight up. If it's above between 40 and 50%, so let's do it like this. If it's under 30%, very bad, you're gonna get fired. If it's like that for 2 months, you're gone, red. If it's between 30 and 50%, very good, yellow. If it's 50 plus, green stars, as long as you can have all of your pricing being exactly what I've told you here and you can use that in your quotes And if you're able to close more than 50%, fantastic. Now, would I compensate a sales manager just on close rate? No, but that general rule of thumb is important. Here's the metric of success and here's what good looks like. Everyone's like, well, I compensate them based upon profit. Yes, but they weren't able to connect the dots that close rate, efficiency score, answering the phone on time, responding back to quotes, following up with quotes once you've sent them actually lead to the profit. So what I'm gonna do, I'm gonna say, hey, Your compensation or your profitability, the profitability of this business, you're going to get a piece of it. Cool. Here's all the metrics that will lead to that. And I'm going to create a red, yellow, and green, or good, bad, and awesome, red, yellow, green, for each of those metrics so that you know where we're standing and I don't have to watch over your shoulder and be a micromanager. All right. We're also going to, next on the checklist for the GM+ size business, we're going to establish quarterly profit share or incentive plan for the managers. So that profit share or incentive could be based upon the overall profitability of the location. It could also be based upon those key KPIs, key performance indicators, those metrics that we've identified as the most important for their individual departments. 'Cause it might not be super fair to give a percentage of profits to the admin person that answers the phone. Say, how do I give them 1.3% and then the other person 2.4% and then my salesperson got 4.8% and then my operations manager gets 6.3%? That might get a little tedious. So what you could do, especially if admin assistants, etc., you could just make the metric that is most important to them, that you deem the most important to them, as the one that gets incentivized and bonuses. Be very careful, very careful, because what you incentivize will happen and everything else will seem less important to them. So if you're going to be like, well, that sounds like a great idea, I'm going to answer. I want them to answer every single phone call within, within 3 seconds. Okay, cool. Guess what? If you put a compensation plan in place where they're going to make way more money if every single phone call gets answered in 3 seconds, what's going to happen is they're going to answer every single phone call within 30 seconds. What's not going to happen is everything else that you've asked them to do. So don't create perverse incentives when it comes to incentives and profit sharing that would lead a manager to focus all of their time and attention on one thing. When you need them to do a whole bunch of things. 'Cause I can't put someone in the office, say there's 2 or 3 people in the office at this size business, $2.5 million in revenue, I say, your job, answer the phones. And I'm gonna incentivize you and you start at $18 an hour, but you can make up to $25 an hour if you just answer every single call within 3 seconds. Again, the calls will get answered within 3 seconds, but they're probably not gonna do the other 10 things you're asking them to do. And at this size, I need to have them cross-trained in admin. That was just an example. The same thing is true with sales. Like, if I just did close rate, guess what's going to happen? They're going to get a bunch of jobs sold and they're not going to be profitable. And the operations person is going to point at them, say, there's no way I can hit these budgeted hours. My efficiency scores are low because you're not putting enough labor hours on these jobs and you're making me look bad. My incentives are going down because I'm incentivized based on efficiency score and you're incentivized based on close rate. And so now this is why you have managers inside an organization beating their heads against each other, because you've created perverse incentives whereby one person winning on their close rate causes the other person to lose on efficiency. All right. Next on the checklist for the GM Plus, we're going to use lead tracking for online ads. If you're running Google or Facebook ads and you do not have tracking set up, you are flushing money down the toilet. You say, well, I don't really care. Like, I just, I'll put money in and I'll see how many leads I get and I'll ask them if they came from Facebook or Google or whatever. Cool. I don't really actually care as much about you knowing where the lead came from. I care about the algorithm knowing that that lead actually completed an estimate because a whole bunch of people are clicking on your ad, going to your website, and then leaving. I want Google or Facebook or whatever platform I'm using to know who actually submitted an estimate request form and got to a thank you page. And I'm going to put that tracking code on that thank you page so it Talks back via Facebook Pixel or Google tracking code back to the algorithm and says, hey, this person, they went all the way through and actually didn't submit an estimate request form. I want you to show the ad to more people like that. Not the person that clicked, the person that actually submitted a form. Create a monthly template for email and text blasts. Upsell all your contacts in your HomeWorks database. You will forever be on the treadmill of spending more money on ads if you do not simply take the contacts in your database and sell more to them. If all things were created equal and I just random person walked up to me and say, I own a house in your market. And then over here, I had someone that I already have their credit card on file. I've done service for in the past. Who is probably more probable that I will sell them more work? Probably the person that already knows, likes, trusts me, has given me money in the past. I have their credit card on file. The likelihood of them doing business with me is much greater than Blow Shmo Glow over here. That I don't even know who they are. So why in the world do we keep spending money on ads going after cold traffic when there are people inside of our database that we have done service for in the past and we never reach out to them? It's crazy. Last week at Augusta, my location, within 24 hours of sending out one text message from HomeWorks, one text message, 18 accepted jobs. That's within 24 hours. Not to say what else happened. And there was 3 of them were occurring and the rest were fall cleanups. And I believe it was around $8,000 within 24 hours. And he was like, hey, like, if you give me another week, I'm sure I'll double or triple this. But I like, no, I just want what happened within 24 hours. And just estimate accepted, estimate accepted, estimate accepted, estimate accepted over the course of 24 hours. One text message. And guess how much it cost him sending it from HomeWorks? Zero. Zero. And yet people spend thousands of dollars on Facebook, Google, yard signs, door hangers, all of this craziness, and don't just send a text or an email to their customers saying, "Hey, do you want more services? This time of year, a lot of people are getting XYZ service, and we want to give you priority and make sure that we are going to prioritize our loyal customers." Sounds like a good idea to me. Okay, let's see here. We got next on the GM checklist, GM+ checklist. We're going to standardize our trucks, tools, uniforms, and equipment. Notice I didn't say that all the way up until we're at $1.5 million in revenue. Worrying and stressing about it, going to Equip Expo and trying to get all of your trucks to look the same, tools, your racks, all of your equipment to be exactly the same. Like, oh no, I can't get the BR BR112 because I already got the BR114 and I got everything has to match. Like, I don't care. Get the work done, grow the business, and at this size, we can start thinking about standardization. The reason I say this is because people overthink stuff way too much and they spend money they don't really have on things they don't really need. And it is in part because when you're doing $300,000, $200,000 in annual revenue, no one cares if your mowers match. No one cares if you Jeff's GMC versus Silverados. No one really cares if you have an F-250 and an F-350 and they aren't both F-250s. No one cares. Customer-wise, no one cares. Now at this size, I wanna start standardizing so it's easier to be able to hand off operations and it's easier to manage. If I have everything being the same, it's easier to hand off to someone to dispatch when it's like, hey, all the trucks are the same. All the equipment's the same. All the trailers are the same. Just go ahead and route based upon budget hours. It's a lot harder if I'm like, well, these 3 different types of trucks, they only pull trailers. These ones are set up differently and like these have to do this type of service and only so-and-so can drive it. So the manual transmission, I know what it's like to be there. It's horrible. At this size though, as I'm starting to hand off all daily operations, I want to be as simple as possible. I don't want to have— I want to be able to have like different, like backup tires to all of my trucks, backup tires to all of my mowers. But I only have to buy one tire. I'll have to buy one of that because I have all the same mower, all the same truck, all the same trailer, etc. But I don't focus on that as my most important thing until I'm much larger and I'm getting out of daily operations. All right. Next on the checklist for the GM Plus is I'm going to decide between a model. Either I'm going to stay with the GM Plus with one single shop and grow well above $1.5 million, all the way up to $3 million plus, or I'm going to do multi-unit Multiple locations, usually those locations, $800,000, $1 million in annual revenue. And I'm going to just copy and paste that across a service area. Next on the checklist, we're going to build an org chart with clear roles. So we're going to department managers, assistant managers, and technicians. I have a picture of this in the book of what a GM+ organizational chart looks like. And the only difference is that you start having assistants. Because when you start having 25, 30 employees, you start needing assistants to the operations manager, assistants to your office manager, assistants to your sales manager, estimators. And so I've got to have clear org chart, who reports to who and what their roles are. How does the office assistant, how does their job different than office manager? Who reports to who? All right. We're also going to create recruiting and training pipeline. So there's an ongoing farm system for future managers. So I don't want my operations manager to bail because they have to move across the country for whatever reason, family, etc. And all of a sudden I'm stuck, me as the owner, jumping back into operations management. I need to create a recruitment farm inside my organization that pulls talent up, trains them up, and serves as backups. Until someone leaves, then they step into that role, creating that redundancy. All right. A few more GM+ checklist items. Number 1, or not number 1, but just next on the list. Shift owner's focus to strategy, acquisitions, real estate, and capital allocation. Notice I didn't talk about that when you're making like $150,000, $200,000, $300,000. It doesn't matter. Grow the business. Don't worry about acquisitions and how you're going to buy your shop space and use that for capital gains and do a Section 179 or What's it called? 5F— mercy. 531. That's not— that's right. I'm messing up. What's it called? Goodness. I just blanked. The 531 exchange. Whatever. You know what I'm talking about. Doing real estate and all these sort of things are not going to be things that you focus on until this size. At this size, when you're out of daily operations, the business is doing $3 million-plus in revenue, you focusing on, like, acquiring a local competitor that outranks you on Google for some random reason because they have the name of the city in their URL and they have like 50 customers and you can buy them out. Awesome deal for you to think about. Not an awesome deal when you have 20 customers and you're just getting started as a solo operator. Okay, next up, we got automate reporting dashboards. So now all these reporting dashboards and these KPIs that we talk about need to be automated. Your profit and loss statement, the KPIs, the cash flow. Now you can no longer operate on gut feel. Like, oh man, I just feel like we're spending too much on fuel. Well, how do you know that? Like, we should have percentages inside of our P&L that tell us like, oh, compared to last year, you're up like 15%. Oh, and if I adjust for price of per gallon, it's still like up 15%. Okay, that's something I should be looking into. So automating the reporting is something that you start thinking about this size so that way you can be away from the business, see a report, and be able to judge the health of the business based upon just the numbers. Also allowing your sales, operations, and admin managers to run the business without you constantly micromanaging or looking over their shoulder. I'm not micromanaging. I'm just asking them how things are and like, what's going on? No, they look at it as micromanaging. You're constantly asking them about everything. So is that almost done today? Okay, is that job good? Okay. Yeah. Did you do this? Did we do this? Like, they're like, oh my word. Can I just do my job, please? Last on the GM+ checklist, lock in personal time, vacations without calls, business runs without you. Okay? At this size, you have to start developing all of these systems to be able to get to the point where you can go on a vacation, no one's calling you, and you're like, well, I delegated the phone calls, but if every single time a customer complains, they're contacting you, we don't really have a system. We have a stopgap measure. We have something that slows down most traffic. I want to be able to, by this size of business, make sure I can leave and I don't get texts and emails when jobs go bad. I don't get texts and emails when someone needs to get fired because my operations manager does that. I don't get texts and calls when a job is underpriced because that's my sales manager's job. All right. That is it for the checklist of the 4 leadership hats: solo operator, working GM, full-time GM, and the GM+.