The Ultimate Guide to Building a $1M+ Landscaping Business

Welcome back to the Mike Andes Podcast, where we discuss the ins and outs of owning a small business. If you're new here, the Mike Andes Podcast is all about taking your business to the next level. So if you've been keeping up with us, you may have seen Mike's huge guide on how to bring your business from $0 to 1 million in annual revenue. The response was so positive that we decided to bring together Mike's best content from across his channel and created the next step. So this is another long one. This time we're talking about $1 million and beyond. So get your note again. As always, you can find all this and more over at the Mikandys YouTube channel. But let's get right into it. This is the full course on how to bring your business to 1 million and beyond.

Hey, everyone, it's Mike Andes. And today I'm going to be sharing with you the full, expanded, unabridged version of how to grow your lawn care and landscaping business past a million dollars in annual revenue. Now, in the past, I've made a very long video lecture about how to get to a million dollars all the way from 200,000, 500,000, all the way up to a million for the day. If you really want to scale the business into seven figures and beyond, this is the video lectures for you. Now, this is going to be a long few hours long of a video course and I highly recommend you watch this one a couple times. Watch it on a TV or a desktop screen if you can, because there's a lot of whiteboarding. Or just listen to this a couple times over and you'll probably get a lot of the information out of it as well. Now, keep in mind, this is more of a two.

This is not entry level. And if you want entry level, watch the video at the end of this one. I'm gonna link back to the one, and in the link in the description, I'm gonna link the zero to a million. But if you wanna take it beyond that, if you wanna go to the next level and seven figures and beyond, this is the course for you. Now, this is completely free, and all I expect, all I ask is that you subscribe to the channel in exchange for all of this free content. And so the first lecture is gonna be about systems. Systems are the thing that allows your business to scale and building your business on systems instead of your personality that's so strong. And you can sell and you can hire people and you can train people. That's all fine and good, but if you're gonna Grow your business to seven figures and beyond. You've gotta have systems in place.

So we're gonna talk about all the.

Different things that systems can alleviate in the business. And the number one thing is bottlenecks. So where at each juncture and size of the business is there bottlenecks and how can we use systems to alleviate those pain points? So let's go ahead and just really recap from the beginning of zero to a million and then beyond what systems you'll need in place as you grow your business. Here we go.

Hey everyone. Really looking forward to talking today about bottlenecks in your business. And I want to specifically talk about how to avoid bottlenecks and get around them using systems. How I kind of think about it is if you had a river here, and there's a dam in the way that is built either by a beaver, so it's trying to block it, or potentially even like an actual like electric hydroelectric dam. And so you have this massive block and a bunch of pressure built behind this dam. Now a way to alleviate this. Because honestly, in my opinion, with business, you actually have to have a lot of structure. And you can't have a river flowing super fast and sometimes really slow. Super fast, super slow. That's actually why sometimes they'll build dams, not even for hydroelectricity and for creating power, but just to be able to control this system of the river so it's not flooding and then there's nothing. And flooding, like have a reservoir and then be able to have a controlled release of the river. And so it's not necessary to say these are the bad things in your business, like, oh, or move the dams like, no, there's gotta be certain controls. There has to be a certain amount of structure in the business so it doesn't just run haphazardly. But one way to release this pressure that can build up over time against the back of this dam is to create.

Use like a side tunnel or they'll have a side track where it allows the water to come around the dam. In the case that there is so much pressure behind this that this potentially could actually give out or the water level could rise above the height of the dam. And so this kind of a pressure release, as I like to call it, this release here, and the over spill is going to be based upon in your business systems. Allowing a system in the business is gonna be the thing that releases some of that pressure that's built up that's typically common around certain junctions in the business. And how I like to look at it and what we wanna look at today is there's gonna be four different distinct dams or blockages or bottlenecks in your business in terms of size. And one of them is gonna be 100,000 in annual revenue. One of them is going to be $250,000 in annual revenue, one of them is going to be $500,000 in annual revenue, and then you're going to hit a million dollars plus. And so obviously, as you grow, you can do 10, 20 million, 100 million, et cetera, there's more different types of bottlenecks that you're going to face. But today I want to specifically talk about these four different types of bottlenecks in the business. Now, when we think of bottlenecks, we don't necessarily usually think of a dam like I just drove out. What we think about is sort of like the top of a 2 liter bottle. And that is where you have a whole bunch of. If you throw Mentos into a Diet Pepsi, for example, Diet Coke, and you throw it in there, why does it blow up? Why? Because it has this tiny little hole in the top that all the pressure built up in the bottle is released through and that makes it have a high velocity and spray way up into the air. And so the question is, what? Parts of our business are taking a huge amount of pressure, a huge amount of operational drag in the business, and then causing blowups, causing massive financial, emotional, psychological issues and massive mistakes and massive failures. This is the result of this bottleneck. Because honestly, if you have a bowl, if you have a bowl like this and you put Diet Pepsi in here, Diet Coke, and then you throw some Mentos in, it just fizzles. It doesn't even like blow up. The same amount of pressure, the same amount of chemical reaction happens. However, because there's no bottleneck, it literally just kind of like, you know, fizzles off in terms of the gas. And there's no big explosion. You don't get something spraying 10, 20ft in the air like you do here, because in this case you have a bottleneck. So in your business, the question is, what are the bottlenecks that are taking the pressure? That's gonna be natural in your business. It's not gonna be easy. It's gonna be very difficult. There's a lot of pressure and there's a lot of things going on in the business. But what can we do to remove these bottlenecks and open up this business? So that way, instead of having bottlenecks, we have a way, when the pressure does come not if it comes, but when it comes, it doesn't create a massive blow up. And, and rather we can deal with the stresses of growing the business because the bottlenecks have been removed. If you cut off the top of that 2 liter bottle that used to have a bottleneck, now you remove that again, that same amount of pressure, the same situation, the same issue that's thrown into the business, the same employee walking off the job, the same $10,000 balanced invoice, whatever it might be, that same thing thrown in doesn't create a massive explosion and collateral damage. And now you blow up at your wife or your husband, and now you have issues in your family and then your health starts to deteriorate, then you can't sleep, and then you have financial issues, now you're taking on bad credit card debt. That stuff doesn't happen as long as you can remove the bottlenecks. So that is the goal of today, is to walk through what are the bottlenecks at each of these four stages in business and what can we do to eliminate them? Alright, so I'm gonna talk about these four different stages because at every stage there's different type of bottlenecks that I typically see most common at that size of business. Because the same bottleneck that you have at $100,000 annual revenue is not going to be the same bottlenecks. The same things that are typically going to be that pinch point, the dam, the thing that blocks up and creates pressure is not going to be the same in a million dollars in annual revenue. So I want to talk about that from really stages of growth, starting off.

With 100.

Now $100,000 in annual revenue. Typically you're working by yourself full time, usually some pretty long hours if you're getting that 90, $100,000 marker, but very doable to do $100,000 in annual revenue by yourself. Now at this stage in the business, the bottlenecks that you're going to be facing are mostly physical. Okay. And these are going to be more evident bottlenecks if you are older. Because if you're doing the physical work, whether that be like mowing lawns, doing landscaping, doing roofing, doing fencing, or doing the physical work of like at a retail store, you're selling every single thing. You're the person behind the cash register, you're the one stocking shelves, you're doing everything, you're typically going to have physical constraints on you because you have limited number of hours, you have limited physical capacity, and if you're out doing physical labor all day long, you better be very clear that you're going to be the bottleneck in that business. Physically, you're going to be the bottleneck. You might have a whole bunch of other potential, but because you are bottlenecked at 100,000 nano revenue, you typically you're just going to start physically breaking down if you stay at this level and start to again allow this physical constraint to be a part of the business that is the bottleneck. Okay, and so the question is, well, how do we get around this stage of growth and stage of growth of 100,000 in revenue? How do I get beyond that? How do I get to 200,000 or, sorry, $250,000 in annual revenue? Well, in order to do this without a massive blow up, you're going to need to remove a bottleneck. Now what are the bottlenecks that I typically see being in this first stage? Well, we talked about physical, but how do we solve that? Okay, first of all, project management videos. Now this is most common for home improvement businesses, but the same could be applied to any type of business where you can create standard operating procedures around doing the work. Because this is the part that is your bottleneck is doing the work. The physical actual manifestation, the physical delivery of the product or service is the part that you're struggling with in this first bottleneck of physical. And so what we want to do is how do we create procedures, SOPs or standard operating procedures around the workflow being done. Now in lawn care and landscaping, for example, when we do a landscaping project, the estimator goes out and does the, does the initial consult, but then they're going to make a video, or we call project management video for that client and we're going to attach it inside of a group and that video is going to be then given off to the employees down the road to be able to do the work. What does this do? This allows you to not be the physical constraint, not have to do the physical work. The main hurdle that most people have at this stage is how do I just get someone to do the work for me and do it right? Well, you're going to have to create project management videos. You're going to have to create SOPs, standard operating procedures, because in order to get past this stage where you're doing all the work yourself, you're going to have to hire people. That is the differentiation between stage one and stage two is you're going to have to hire people. In order to do that though, you're going to have to make sure you have project management videos or some sort of stage standard operating procedures documented with video to be able to give to a potential employee so you can move on and grow the business without a massive explosion. Because what happens is most people will do this. They won't create SOPs, they won't create project management videos. So what happens either a they as the physical constraint, the physical bottleneck in the business will overwork themselves and lead to a massive heart attack. Something really physically they start to fall apart, especially if they're older or two, they'll hire people. But because they don't have the project management videos, because they don't have standard operating procedures, that bottleneck again blows up. And they like, I can't find employees. Everyone's no, it's just so hard to find people. And no one works out. No one works as hard as me. Why you haven't created standard operating procedures, you haven't created project management videos to give them the tools and the step by step guide of how to do the physical work so that you don't have to. And 80% of business owners will never get past this first stage of growth because they fail to remove the number one bottleneck, which is physical bottlenecks. And to get around that, to get around that dam, that release point, you're going to need project management videos and SOPs. What are those? Those are the systems required to get around the bottleneck. Okay, so over here we have systems required to get around the physical bottlenecks of growing your business past $100,000 in annual revenue. Now another system, another procedure you're gonna need to be able to hire people is you're going to need some sort of orientation and training program. This is again another system that needs to be created in order to get around the bottleneck and the dam of physical constraint. And that's what's gonna be needed just to get past 250. Now I see some business owners doing 500, 700, 800,000 in revenue and still they have not done these things. And typically that's the person who will burn out or run a very unprofitable business because they've never even solved these issues. And you say, you say, well, how do they grow their business past the first stage of growth? Probably because they're just crazy hard dropping pens, probably just because they're crazy hard workers and they simply just will themselves into growing their business. And that's fine, that's awesome. All power to them. However, you can absolutely do this without a massive blow up, without physically falling apart. Without financially falling apart, without going into massive amounts of debt on all your trucks and equipment and having employees scream at you in the face. You can get around these things by having these systems in place prior to moving to the next stage. So I'd really recommend, before you start growing your business, make sure you have a project management videos in place. Make sure you have standard operating procedures on a video. Make sure you have an orientation and a training program, a checklist from new employees to be able to be like, yes, I did that. Yes, I know how to do that. Yes, I know how to do that. And then like, okay, you are now officially through the first two weeks of training, an orientation process. It should not be, hey, show up to work, here's your uniform, jump in the truck, go like. They're like, okay, well, who do I ask to get time off? How do I move up inside this organization? Is there any bonus program? What are the medical benefits? Who do I ask about that? These are things that are really important for the employee. And if you're not answering those questions in the orientation, you can promise yourself that they're probably not going to be as engaged. And so if people wonder why I can't keep employees past a week or two, they just show up, and then they just stop showing up all of a sudden. Well, they might have a whole bunch of questions that you could answer answer in the first 15 or 20 minutes if you just had an orientation and a training checklist and some sort of system to get them onboarded again, what is that doing? All of that's allowing you to have hiring. And that hiring is going to be the thing that allows you to get around the physical constraint and bottleneck that's going to keep you from growing sustainably past $100,000 in annual revenue. Now, this next one is what I call mechanical.

And you could even just call it technical. So this is gonna be the part of the business where you actually have technical knowledge or mechanical abilities that are the bottleneck to growing the business. Because at this stage now, you really need to know what you're doing in terms of managing multiple employees. And you physically might be able to have that handled. Like, the employees do their job, but that's fantastic. But now you have the problem of I've got to train them all. The technical side of the business is too much for me to be able to train all these new employees. Like, yeah, I have standard operating procedures. Yeah, I have orientation and training, but I've got to train these people in some really complicated stuff. And it's taking me a long time to do that. And so at this stage, to get around this as the bottleneck, them having to know certain types of mechanics, like if you do roofing, they gotta know all about the ladders, they gotta know about the nail guns, they have to know about the shingles, they have to know about the underlayment, they have to know about how to do it around gutters and how to do it around chimneys and all these different things. The question is, okay, I know that there has to be a better way to do this, but yet I also know that I have to be able to have the technical ability and I have to have the mechanical ability to get the work done. So at this stage, this stage of growth, if you want to continue to grow without a massive blow up, this is when you really make sure you have these systems in place to allow you to get around these bottlenecks. What are those systems? The first one is gonna be simplification. This is gonna be where you simplify the services that you offer, simplify the products that you offer, reduce the SKUs that you offer. Because simplification is going to be the way that you don't have to have as much technical knowledge. You won't need as much mechanical knowledge because you won't need as much equipment, you won't need all the complicated things. And you'll be allowed to keep growing the business past one or two or three employees because now you've simplified things. It's easier to get people up and trained and profitable and efficient inside the systems that you have. So simplification is extremely important at this stage of growth. If you're going to. Not if you're going to alleviate or if you're going to circumnavigate a massive blowup. And the whole point here is to use these systems to get around the bottlenecks so you don't blow up, I. E. Quit on the business. Most people will just quit at some stage of growth, mostly because they haven't implemented these systems. Alright, the next system you're gonna have to really create at this stage is the mechanical side, alright? Mechanical. Especially if you're someone like myself. There's parts of the business that I have no idea how to do in terms of fixing things like mowers and trucks and trailers and equipment. I have no idea what I'm doing. So what am I gonna do? I'm gonna create some sort of a mechanical system. Okay, is that a checklist? Is there a way to keep and document the service records? Is there a way to document who did what in terms of maintenance on those pieces of equipment? The mechanical side of things. At this stage now, you're not in possession of all the equipment at all parts of the day. You have crews leaving without your supervision, using the mechanics, using the equipment, using the trucks. And now you've got to have some sort of system around the mechanical part. This is usually a lot of times at 250,000 revenue where I see business owners camping down on types of equipment, types of trucks, types of trailers, et cetera, because they get so wrapped up in the mechanics of their business. And they never create a system around the fact that, like, look, we gotta have a certain type of truck, a certain type of trailer, certain type of mower, and we're just keep rolling with that, or that's for a mowing company. And maybe you do the excavation. We're gonna use a certain type of excavator, we're gonna use a certain type of trailer, certain type of dump truck. And this is how we roll. And they don't get wrapped up in all the different fine details in the minutia of, well, I got three trucks and now they leave and I can't manage them. They're driving the truck really bad. And now I'm gonna spend all my weekend redoing the bodywork of this truck or the engine of this truck, and I gotta redo the clutch. So these are the things that bog people down. These are the bottlenecks inside the business. Create a system around having the mechanical side of the business, the equipment, the assets of the company taken care of. Okay, Cost of non revenue producing employees. All right, I'm just gonna. Non revenue employees. These are what starts to crop up after 250,000, and that is employees that do not generate revenue. Rather, they are office admin mechanics.

Lead technicians, they are managers, quote, unquote, operations managers, project managers, random managers that basically do not produce revenue. Very scary. At 250,000 in revenue, to be having a lot of employees or staff that are not producing revenue. Non revenue producing employees. At this stage of the business, you've got to create a system around how do I reduce that as much as possible? Can I outsource my office staff? Can I outsource the person that does the mechanical side of the business? Can I outsource these things? So I do not have non revenue producing employees on the payroll. It will suck the profit out of your business, especially at 200, 300,000 in revenue. And I typically see companies that go like 3, 4, 500,000 revenue. They have like three office people and an operations manager and a full time estimator. It's like, look, you have five people that aren't even producing revenue for the business. And if you got three or four employees out in the field, how in the world do you expect to be able to cover your overhead? And so I see a lot of times at this stage because there's technical and mechanical issues, because there's a lot of moving pieces now in the office and the admin, phone calls coming in, emails coming in, people way overspend on non revenue produced employees. Their overhead goes through the roof, they get a really nice office. All of these things are because of the mechanical and technical issues that come up at this size of the business. They start getting too much trucks, too many equipment, lots of loans, non revenue producing employees to manage all the mechanics and the trucks and the equipment, et cetera. Don't do that. Try to keep it lean and mean at this stage so that you don't have a ton of overhead. A ton of overhead is gonna be what's keeping you from getting to 500,000 revenue. That's typically why I call this the wilderness in business. 200 to 500,000 in annual revenue. Because a lot of times what happens is at this stage, because of the mechanical and technical issues inside the business, people will go overpay on equipment, they'll overpay on non revenue producing employees, they won't simplify their business, they'll just add more services. And because of that they don't make any more profit at 250 versus a business doing twice as much in revenue. 500,000. But they won't make a single penny more in profit.

Why?

Because they did the opposite of these things. They did not simplify, they added more services, added bigger services, added more complex services, and now there's all these moving parts in the business. So what do they do? They go get non revenue produced employees and managers. What do they do? They go buy more equipment, they get more into debt because they need more trucks and equipment to add more services. And because of that it adds more and more complexity, which adds more and more of a pressure on the bottleneck of the business, which at this stage is a technical advantage. Alright, so on the third stage of growth, where we are talking about $500,000 in annual revenue, what is the major bottleneck that I see at this stage? Office and admin and I already kind of alluded to some of these things already. But in this first, the second stage, the 250,000 stage typically is going to be like a project manager, an estimator. You start putting a lot of hierarchy in terms of team leads, etc. Out in the field. But now office and administration, very, very important in your business. If you want to grow past 500,000, you need good office and admin. However, this starts to trickle down into this next stage and that is non revenue producing employees. And now all of a sudden you have two or three office people, you have a really nice office, your overhead is high in this rent and you have utilities. Like you got to pay for the Internet and you got to pay for the water and the power and all this other stuff. And all of this is to feed what the office and the admin side. And as business owners we, we hate office and admin work. I understand you don't like answering the phone calls, you don't like answering the emails, you don't like having to get back to people. You don't have to like doing payroll, you don't have to doing invoicing and QuickBooks and balancing the books and all the rest of it. This is why I recommend that until you pass $500,000 in annual revenue substantially, that you use some sort of virtual office to be able to answer your phone calls. Do your emails send out your estimates? Do as much as they possibly can. Because I don't want you have to go hire somebody to be an office manager. Here's why. Number one, if you hire someone as an office manager for $50,000 and that's their salary, guess what? If you're running a 20% profit margin business, you're going to have to do $250,000 in annual revenue just to be able to pay for their wages. 20% of 250,000 is $50,000. That's their wages. So you literally have to grow your business from 500,000 to $750,000 and you won't see any more profit in between. There why you have to hire an office person. And we're not talking about all the other overhead that comes with having an office staff like computers and utilities and rent and all the rest of it. We're just talking about their wages. You've got to grow the business by 50% just to cover the cost of that office and admin person. This is the one we always jump to. And this is why I so often times see people just immediately want to actually like, oh man, I have like 200,000 revenue. I need to go get an office person. I literally see people embracing this bottleneck, and the reason I call it a bottleneck is because I don't want all the keys to my customer's knowledge, to what's going on in my routes and my dispatch and to my billing and my invoicing. I don't want all that locked up in the mind of one person. And so often the time I see businesses that are 6, 7, 7, $800,000 in annual revenue and they have an office manager who, who leaves and the business just falls apart because they were the bottleneck. And what's so important is you cannot just hand off the bottleneck from one person to the next. You can't just be like, oh well, I'm gonna pass the physical side of the business along to someone else. And you know, I'm not gonna, I'm no longer the bottleneck, but now you just pass the bottleneck on. Now if you don't have these systems, I don't care if you delegate, you can delegate to another person and they might be better at the physical work than you. And if they're really capable and experienced, it might kind of improve the situation, but it doesn't remove the bottleneck. You have to have the system to get around the bottleneck, otherwise you will eventually lead to a blow up. And if you hire a really great person, it might put a band aid on the situation. But eventually if they leave, guess what, all that pressure can be released. And I don't want that to happen when you're at the office and admin level because they're out here doing phone calls, you know, they're out here doing email, they're doing billing, I can't hardly spell billing, all these other things and you're like great, this is fantastic. But they're a non revenue producing employee and if they don't have the system of being able to have this, a duplicatable system from one person to the next. This is what I truly believe, that like until you're doing well above 500,000, I'd rather have a mobile office, someone else answering the phone by the minute, doing emails, doing all my admin work, because I don't want to train someone up for six or seven weeks on my CRM and how to balance the books and how to run payroll and I train them all up just perfectly and I know I'm paying them a really good salary, but I'm doing it for the long haul. And then what happens? They leave and you just wasted a month and a half of your time putting and investing all of your Time and effort into what? Building a bottleneck in the business, which is basically hinging on one other person. And so if they leave, you're toast. If they ask for a big raise when you just do not have the money, you're toast. I don't want to create that bottleneck inside of the business. I want to allow as much as possible for my phone, email, billing. All of this needs to be simplified and then handed off to someone else that can do it by the minute or virtually have someone else do it. Have two people do it virtually part time. However you want to break it up, I really could care less. But I don't want the bottleneck of your business to be built around one person. Two people in an office and all of a sudden you have a bunch of overhead non revenue producing employees. But most importantly, you've created a bottleneck in the business. Now a lot of times the office and the admin side is taken care of by the spouse of the owner. And this works out really good as long as they stay spouses. And so you've got to make sure if you're going to build a business. I don't want my personal life, I don't want relationships, I don't want my health, I don't want anything to disrupt the business. And you might get started with your family, your spouse, your wife, your kid, whatever it might be, doing the books, answering the phone, etc. But again, what happens if they don't aren't able to make it? What happens if they physically cannot do work anymore? What happens if there is a struggle in the relationship? Do you want that to affect the business? That's why so many businesses fail. Fail when there's a divorce, when there's some sort of friction in the relationship, the business falls apart because the bottleneck was built on some sort of familial tie with the business owner. And so if that ever gets broken, the business is kaput. And you've created a bottleneck around the office and the admin side because now depending on a different factor outside the success of the business, I don't want to do that. And it could be a good place to get started. But just remember, you are building a bottleneck around the family side of the business instead of actually getting the work done in a way that has systems and procedures. Because guess what, if your spouse is doing your books, it's really easy to communicate with them. It's really easy, like hey, what'd so and so say? Customer? What did they say in the email? Oh, what was their message about the other day? Because you're always with them. It's so easy to be able to just. It's so much. It seems easier just to do office and admin inside of your family. The problem is like, what if that goes away? And now all of my systems depends on me being with the person all day long. Well, that's a problem because if I have to get an office person who's not my wife, who is not my spouse, who's not my husband, who's not my kid, and I don't get to see them all the time, I don't have that connection with them. Do I have the systems to be able to actually run the business efficiently? And again, this is going to be the systems for your phone service. Okay, you're gonna need a system for onboarding clients. How do you send, what emails do you send them when they need a job scheduled? You're gonna need a system for leads or sales. These are all systems that you're gonna need. You're gonna need a CRM. You're going to need to know how to do your QuickBooks or balancing the books and doing your balance sheet and, and doing your financial statements. These are all parts of admin and office that you will need to create a system around if you want to continue growing the business and not have bottlenecks. You can, and most people do, build their business past 500,000 in revenue and they still will have multiple bottlenecks inside the business. It's not to say that you cannot grow the business past this stage with these bottlenecks. It is simply to say that if you want to build the business past this, these markers, you're going to need these red systems at each of these stages in order to be able to build the business without bottlenecks that down the road are literally like a ticking time bomb and could blow up at any point. And that's why most small businesses fail, because all of a sudden they fall apart physically. All of a sudden, the technical people that they've hired, that they put all the responsibility for a certain part of the business, the actual doing part of the business, they all of a sudden leave or office. And admin, all of a sudden, the one person, they had all the trade secrets, only person knew how to get into all the software and run the books and other things, well, they pass away or they move and now what, what happens? Honestly, most businesses go half the size the next year they got. Well, Sally always ran the books and she knew all the routes and now we don't have her. So I'm gonna learn a new software. It's gonna take me all the next three or four months. We're just going to cut back our staff and we're going to grow back to 250. That's what happens all of the time. And that's what I'm trying to prevent for you right now. Last stage of growth, $1 million in annual revenue. And at this stage the typical Ball and Lex that I see, $1 million plus, I'm going to go over that now. Now again, if you like this type of content, I'm going to be starting to drop one of these every single month on mbaforantrepreneurs.com and landscapebusinesscourse.com More specifically, landscapebusinesscourse.com is going to be for landscaping companies and lawn care companies. And more general topics like this are going to be for MBA for entrepreneurs. So check out both of those more generic service based businesses. Check out mbaforantrepreneurs.com if you're a landscaper. If you do lawn care, I highly recommend landscapebusinesscourse.com because I'm going to be doing a lot more larger content like this. We are creating final exams for all the current curriculum. And then once you're past that, you're able to, to start unlocking the monthly lectures that are going to be more in depth, such as this one. All right. At a million dollars plus in revenue. Oh, the business is good. We've gotten through those other stages. Maybe you have or maybe you have not implemented all these systems so that each of these bottlenecks can be removed or circumnavigated. But now let's talk about some of the bottlenecks that will happen at this stage of business and what you will need to do to get around them. You'll, you'll need some sort of decision making process.

This one is tough decision making process. So now at this stage of growth, a million plus in revenue, you're gonna have decisions in the business. You've gotta have a process of coming to the right decision based upon all these inputs. Cause no longer are you doing the physical work. No longer do you have the mechanical, technical knowledge of all aspects of the business. No longer do you have the office or admin side that you are doing because you've eliminated them as your responsibility as you the bottleneck. So now you've got to take all of these inputs because they're all important parts of the business. It's not to say these things are not important, they can just become bottlenecks. And they typically do at these sizes of business. But even once you've grown past it, you got to take these inputs and now run it through some sort of decision making process. Which means you've got to have goals, you've got to have objectives, and you've got to have a clear, clear defined future of what the business is going to do. And that is usually going to be the determining factor of what decisions you make using these inputs. Does the output of these inputs lead you in the direction of the future that you want for the business? The goals that you have, the size of business that you want to grow? You've got to create a decision making process. And that's a fancy way for saying like, have a plan for the company, know what you want. From a 5, 10 year perspective, how big of a business do you want to grow? What does your role look like in five or 10 years? Because that is the decision making process that everything needs to be filtered through. All of the inputs need to come through this decision making process and ask yourself the question, does this get me closer to my goal? Is this moving the company in the direction that I want it to go long term? All right. Another thing that you're gonna have to start doing is creating a system around delegation. Cause all of these things I talked about here are all important and in every single one of them I could probably have 10 different things that you need to delegate inside of that input. The physical side, for example. Let's just take this one input of physical labor or physical doing, getting the product or service actually performed for the client. Physical. You would have to delegate everything from ppe, personal protection equipment. You're going to have to do the physical work and you're gonna have to actually like tires, equipment, all these other parts of the business. You're gonna start delegating. And you're gonna have to really good at delegating when you're at a million plus in revenue. Cause you're gonna have 10, 15, 20 employees at this point. And you better make sure you're not the one that's out there every single morning checking every single thing. You'll run yourself crazy. And I typically see people doing a million dollars in revenue plus. If they have not created all these systems at each stage of their growth, what happens? They run a$million business, alright, but it runs them. They do everything in the business. They haven't delegated anything and if they were sick for one week, their business would fall apart. And the reason for that is because they are so confident in their abilities, which are amazing and an entrepreneur type a person, they can do a lot of stuff. And that motivation is what powers them through all these stages without having to use these systems. But I promise you, having these systems at each of these, these stages of growth will allow you to get past a million dollars in revenue and not pull out your hair every single day and not lead to the massive Mentos and Diet Coke blow up that happens in so many businesses that causes them to quit and fail. You're going to have to become a good meetings person. Alright? Meetings. Everyone hates on meetings. Meetings are so important. I actually really enjoy meetings and it's something that must be done at this size of business. Back here you could be like, hey, you do this and you do this and hey, I'll chat with you after work and see what you're up to and all the rest of it. You don't have to have meetings because you're start having mid level managers. And in order to have mid level managers it means that you're not going to have direct contact with every frontline team member. And so what are you going to have to do? You're going to start figuring out how to have meetings with your mid level managers so you're all unified in front of the frontline team members and meetings are very important. I don't care if it's safety meetings with your front line staff, I don't care if it is equipment maintenance meetings with your mechanics and people who are doing the technical side of the business. I don't care if it is about systems and procedures inside the office and the admin. You've got to get good at doing meetings, communicating with people. You've got to create a system for those meetings. How do you present, how do you have an agenda, how do you make sure that you wrap up and give the actual points that people need to work on until the next meeting. You're going to have to get good at meetings. When you're building a business above a million dollars and you can't micromanage through all of this, you cannot micromanage at this size of business. If you are, if you're bouncing back into the office, if you're telling people how they should be answering the phone and you're jumping in like no, no, no, this is how you do it. And then you're seeing someone fill up the gas in the shop in the morning, you're running over, no, no, no, don't do this, don't do that, don't do that. That is not being involved. That is micromanaging. And if you're running back and telling people, oh, no, no, you got to make sure you edge this and do this right, do this wrong. You, if you're building a million, 2 million, we're talking 10 million dollar business. You can't be jumping in and being a helicopter manager. It's like, oh, no, no, no, no, no, no, no. You got to do it like this. And then you jump into their situation and start fixing it, telling them how they're doing it wrong and micromanaging. You're gonna now start leading through delegation, leading through other people, allowing leaders to grow up underneath you. And you've got to create a system around that form of leadership. You've got to develop that leadership. You've got to have meetings around that leadership. You gotta cultivate them and educate them on becoming a better manager and a better leader. So these are the four different stages of business, all the way from zero to well above a million dollars in annual revenue. And at each of these stages, there's bottlenecks, there's points in the business that are crucial, important points, but they can build up pressure and cause a massive blowout, a massive failure, a massive explosion if there is not a system to fix it. And everyone's always like, man, what are systems? Tell me about some systems. Okay, all of these red things are just a few of the systems required to get around these common bottlenecks that I see at certain sizes of business. And you might talk to someone who's like, you gotta talk about management and leadership and all the rest of it, and that's important. But honestly, that system is only gonna be super necessary once you're past a million in revenue. If you're just gonna started, the type of systems you need to really be focused on is like, do I know what my standard operating procedures are? Do I take videos of jobs and projects so I can pass it along to somebody else? Do I know how to give orientation to a new employee and train them up? These are the type of systems you need to focus on because the size of your business matters. The size of your business is going to be the determining factor of what systems you need to be focused on. So when you listen to me or anyone else talk about systems and procedures, you've got to ask yourself, what size of business are they talking about? Because it really does matter what systems you implement at certain sizes of business and which ones are most important to implement when you're small versus when you're big.

All right, So I hope that was helpful, talking about systems and procedures and creating standard operating procedures in your business. Now we're going to talk about why sometimes growing your business super big not the most profitable thing for you to do. And why some smaller businesses, smaller lawn care landscaping companies that are making a couple hundred thousand dollars in annual revenue will actually make more profit than the business making 1, 2, 3 million dollars in annual revenue.

So I'm going to talk about that.

But before we do, we have to address the gentleman's agreement. The gentleman's agreement is a trusting relationship that I have with you as my audience, that I, in exchange for all the work that I put into these videos, giving you them completely for free, that you do one thing for me, and that is just subscribe to the channel. Now. If you've already subscribed, this is a great opportunity to share this video with another landscaping or lawn care community on Facebook or a group that you might be part of on WhatsApp. Just share this content. It's completely free. I'm not even putting ads throughout this entire thing just so that you can just sit down, listen to this, watch this, and learn as much as possible. And what's amazing to me is somehow that there are more views than subscribers on my videos. It just boggles my brain. And the gentleman's agreement is like, I'm just trusting you enough. I can't watch over your shoulder, but I just trust that you're gonna click subscribe. So please do that. And without any further delay, let's go and talk about why smaller lawn care businesses will actually sometimes make more profit than big businesses. Here we go.

This is kind of one lesson. It's actually 8.22 module 8.22 that I'm gonna be taking from and applying directly to the lawn care landscaping industry and talking about how your pricing affects your break even point and, and your profit margin. If that means nothing to you, don't worry. I'm gonna explain. I'm gonna use a graph here to explain this. And if you're like, I don't like graphs, I just mow grass. Well, you gotta know your numbers and that's gonna be how you make a successful business. I'm gonna try to make it as simple as possible, but I hope this is branded in your mind. And I know I made a video several weeks ago about supply and demand curves, which is also inside the MBA course. And a lot of you said that was very helpful to kind of break down A very complex topic and make it simple. So I'm gonna try to do the same thing here and stick along. Watch this maybe twice. But I promise you this will be very helpful as you determine your pricing strategy and you grow your business. And you're gonna understand why you might not be making money yet in your business. And hopefully it'll keep you engaged in the game of business long enough to actually start making profit. Because there is a point when you're actually going to be losing money in your business when you first start out. So let me explain the graph and what is on the x and the y axis? So x axis, Y axis. So over here we have costs and revenue. Okay, so over here we have a million dollar business up at the top all the way down to $100,000 business. So just getting started all the way up to a million dollar per year in annual revenue on the bottom here. For the sake of this example, I'm using number of lawns. But you could use any number of units that your business produces, whether you're producing widgets or phones or cars. This graph is universally accepted for break evens and pricing strategy. So, but we're going to use number of lawns and I'm going to also assume again, very generalized numbers when it comes to the cost per cut for your lawn. So a lot of this is generalizations, but you're going to get the point. And that's all that I really care about today. So on the bottom here at $100,000, I have that as our fixed cost. These are things like the space you need to operate your business out of. Maybe you got a couple acres next to your house, you purchase that, you have a loan on that and that's fixed expense. You have some insurance, you might have some loans that you bought your initial equipment for. Whatever it is, these are fixed costs. Doesn't matter how big your business gets or whether you don't do much revenue or not. Fixed expenses. Here we have total cost, which is variable cost plus fixed. That's why it starts from where the fixed cost is. Here it doesn't start at zero because a fixed cost is. It doesn't matter if you have zero lawns, you're still gonna be paying your fixed costs. But as you get more lawns, you're gonna have more variable costs. Cause you get employees and more trucks and do advertising and all the rest of it. So as your business cost grows and you get more lawns, you're gonna also have a growing amount of variable cost and therefore your total Cost is going to rise. So that's what this angle is right here. So don't feel overwhelmed. Watch this again if that doesn't make sense. But let me walk you through this. What I want to exemplify today is just how important your pricing is when it comes to actually making money in your business. So we're gonna do a few different examples. The first example is gonna be that one we price our lawns, let's just say on average $40. Alright, so $40 for our lawns is what we're going to price. Now let me just draw the line out here. Hopefully we can make this work. There we go. This is supposed to be straight. So let me just try to correct this real quick.

Boom.

Yeah, just not great drawing skills. But hey, you get the point. So red line right here. So the red line is going to be that using the red line, we are at $40 per cut. That's our price, same number of lawns. So as we get more lawns, this is gonna be our price. Our price is $40 per cut. What that means is that right at this point right here is gonna be our break even point. Right when we cross our total cost, this is our break even point. Assuming $40 were cut. So about just for the approximation sake, when we get 200 lawns at a $40 per cut price, that is when we're gonna break even on this business. If our average cut is $40 and we get 200 lawns, that is when we're gonna break even. Okay, now I want to go now. What happens if we change the average price of the cut? We keep everything the same. We keep our wages the same, we keep our fixed costs the same, everything the same. But Instead of charging $40 for the cut, we have a premium price product and we're going to charge the customer $50. Well, what that does now I'm using the blue here is it increases the.

Scale of this, drawing this line here. So now with this blue line, this is going to be at 50 per cut. We've raised our prices. So now what that does is it moves our break even point all the way back to here. Okay, so this is our break even point way back here. And this is why you got some people that are solo operators making a decent profit because and they only have 50 lawns. Look at this. This person only has 50 lawns. They're doing like $150,000 in annual revenue and that's their break even point. Whereas our first guy, he had a $40 cut. So let Me just write this up here. So this is $50 per cut. So premium price, $50 per cut. This person might have a website, have uniforms, have a painted truck. So therefore, they're able to get a higher price per cut from the customer because they raised the value of their service. So because of that, their break even, or when they stop losing money and start making money and is at 150,000 revenue and only 50 lawns. This is like a solo operator. They're able to make 10, $15,000 a month by themselves working in the field doing 50, 60 lawns. And they can actually make pretty good money. All right, now let's go over to our first guy. He had to do 200 lawns. And just for the sake of this example, he had to do like $300,000 in revenue just to break even, okay? So now the question is, okay, well, I'm gonna have a $50 cut. How much more would I make in profit when I get to 250 lawns if I have $50 cut instead of $40 cut? Well, let's do the math, okay? So maybe in year three, okay, we're at 250 lawns, okay? Let's just do the dotted line up to here.

Boom.

So our first point is going to be here. And then we go up, up, up, up, up, up, up, up, up, all the way to here. And there's another point. So this is what's going to happen If I have 250 lawns, all right, and I'm using a $40 per cut price. Now, this is gonna be my profit margin right here. This is my profit margin. This from here down is my total cost, okay? If I'm pricing at dollars per cut, this is my total cost, and this is going to be my profit. Very low profit margins, okay? Out of, let's just say probably 350,000 in total cost, I have maybe $420,000 in total revenue. So therefore, my profit is probably like $70,000, okay? That's my difference. The difference above this total cost and where my revenue is at is my profit margin. Now compare. Compare that to what it looks like. If I'm at $50 per cut. This angle here, I'm going to still have 250 lawns. But now look at where my cost is. The difference in my profit is massive. I'm running like a 50% margin business. I'm probably doing 130, 140, $150,000 at least in profit. This is not necessarily the scale, but let's just say for example, probably, you know, probably like a $300,000 in profit, just massively more profitable simply because I have a $50 cut instead of a $40 cut. Now let's erase these markings real quick, and I'm gonna show you what happens when we have a $30 cut. Okay? And again, these numbers that I'm using are just subjective. It's just to show medium, low and high pricing. It's not to say that these prices per cut are wrong or right or what you should be using in your market. So let's draw though another pricing method. This is gonna be the low cost method. This is gonna be someone that comes in and just wants to get a whole bunch of lawns, and they're gonna be the cheapest price in town. So what we're gonna do is we're draw another line here. We're gonna go like this. Boom, bam. Okay, now this green line is going to be $30 per cut. Hopefully you can see that green, $30 per cut. Now, what we've done, because we've lowered our price, it's literally going to take us all the way to like 300, let's just say like 320, break 320 lawns and like $450,000 in revenue before we actually ever break even. Okay? So what I'm showing right now is the importance of having a higher price, a premium price, which is going to allow you to do several things. First of all, it's going to get you profitable faster. The number one reason why people in the lawn care, landscaping industry fail or they quit, I should say, and they give up is because it takes them too long to get to break even. This person had to get 320 lawns and literally do over half a million in revenue before they ever actually made a single penny. And if that took them two, three, four, five years, most of the. Most of us get discouraged. Most of us want to give up. Most of us want to go get a 9 to 5 job where we can get a stable income for our family and provide simply because all of this line all along here, having hundreds of customers, this person has 200 customers and they're losing money. They have 250 still losing money. It's not until they're above 300 customers where they even make a profit. And literally they could have 400 customers. 400 customers, and look how small their profit margin is going to be. Very small profit margins. That can be very discouraging, having to wait that long to hit breakeven. And you're not making any money. You're losing money every single year. And so if you have a higher price, you don't need as many customers and you don't need as much time, you don't need as long of a Runway to actually hit profitability. Couple problems I see so often in landscaping is to trying. I want to explain on here. First thing I've already mentioned that is I see pricing as too low, which causes burnout or bankruptcy before break even. So all of this time I'm burning money, burning money because I'm below my total cost. It's not till right here and beyond that I actually start making profit. So what's happening here? I'm burning through my cash reserves, I'm getting loans. That's horrible. That's what keeps a lot of people from ever getting to profitability is simply because they're pricing so low that they never actually get to becoming profitable. Alright, the second thing, second problem I see so oftentimes is something that's inferred in this example that might not be true. And this is for those of you who have already started a big business. You might be already 3 or 400 lawns or 8, 900,000 in revenue. This is what you gotta be careful of. You gotta be careful that this fixed expense line doesn't also grow. Because if you start shifting as you grow your business, this fixed expense starts going up. We go build a big shop, we get nicer trucks, we get more debt, we get bigger equipment and we get more and more in debt and our payment's starting getting bigger. And because of that bigger, our insurance starts to get more. If your fixed expenses grow, your total cost is also going to go up. So if you're growing this way, I have a that we're gonna stay at the same property. We're not going to get a bunch of loans, a bunch of debt. This is where I get concerned, why people increase their fixed expenses as their business grows. They get a bunch of loans on equipment and trucks. They go out and get a bunch of space and build a big shop and get a bunch of office staff, all overhead, all fixed expenses right here. And that's why they never actually get to break even. Or a highly profitable business because they move this fixed expense line item up as they grow their business. So instead of it being flat, the fixed expenses is actually angled. And that can be very detrimental. And people can be growing into oblivion and never become profitable or profitable enough simply because they keep adding loans and fixed expenses to their balance sheet. The third thing I Want to keep you, want you to keep in mind is that low prices equals low profits and low prices, profits lock you as the owner into operations indefinitely. So when you growing your business, this guy over here, he could be doing 8, 900,000 in revenue, but because his profit margin is like 8, 9, 10%, he's only making like 70, $80,000 in profit. That owner will never be able to get out of the business because they're not going to be able to afford a manager to take off their daily, take out, take daily operations on off of their plate. So if you're in the place right now where you are having very low margins and you've grown a big business, you're like, man, I'm doing 7, 8, 900,000, I'm doing a million, $2 million in revenue, but I'm doing the estimate still. I'm everyday working 12, 14 hours in the business. I'm out on projects, still moving materials from job site to job site. I'm still trying to hire and figure out marketing. You're trying to do all of that. You've got to realize that raising your prices is extremely, extremely fast way to solve this whole problem. This $30 cut guy could simply raise his prices and by doing so, he's gonna bring this up this way. And by bringing this up this way, he's gonna move his break even down and he's gonna increase his profit margins. And by having a wider profit margin like we talked about with this guy here, where he's at like 50% margin here, when you have that, you can afford to go get a manager, you can afford to hire other people to take off things off your plate. So you as an owner at 800-900-A million million plus in revenue, don't have to be there every day. You can go start another location, you can go start investing. But this is extremely important. Pricing is extremely important to your profitability, to your break even, to make sure you can actually get past the point of losing money. And this is why, this is why I see small lawn care businesses, small independent solo operators, sometimes making more profit, bottom line profit than companies that are doing hundreds of lawns and hundreds of thousands of dollars in revenue is because their pricing is where it needs to be at. And if you're wondering, well, how do I increase my prices? Well, maybe you are so far below in your prices that you just need to raise them and lose some of your customers, that's fine. I'm not interested in building a massive business with a bunch of employees, a bunch of trucks and a tiny profit margin. I'd much rather have a smaller business. Less lawns, less overhead, but higher prices to the point where I make a better profit margin. I'd much rather be the Whole Foods of the lawn care industry than the Walmart. At Walmart, they get 1 to 2% profit. Profit on everything that is purchased. Why? Because they focus on volume. They've got to move tons of product out the door. They're going to get like 1 to 2% profit, whereas Whole Foods might get 5 to 10% profit margin. They're not going to do as much volume. They're not going to be able to send, you know, have thousands and thousands of locations. They're much smaller footprint. The size of their buildings are smaller. They don't have massive warehouses. But they actually get more profit per customer because they have a higher price. They're not trying to compete on price, they're competing on value. They have, when you walk in the store, there's really nice paintings and there's art and the employees are more friendly and they're trained to be more around the customers and give you more help. What is that? It's a matter of that they are no longer competing on price, they're competing on quality. If you can compete on quality, it allows you to raise price and be profitable faster. So if you're in your second, third, fourth year of business and you're still losing money, there's a very good chance that you're either starting to inflate your fixed expenses as you've grown, or your pricing is so low and you need to raise it in order to have a sustainable profit margin. It is not sustainable to have an under 10% profit margin in this business. If you're under 10%, in my mind, you're vulnerable. You want to be over 15% and that's going to take some time to get there. Don't expect that in your first year. Even the solo operator guy, there was a period of time where he was putting all his money back in the business. He was under break even. But the faster you can get above break even and start making profit, that profit can be put back into the business and scale much, much faster.

So now we need to talk about marketing, getting more customers. If you're gonna grow a big business past seven figures, you're gonna have to figure out customer acquisition cost. So let's talk key metric, because you've got to figure out and understand customer acquisition cost. If you're gonna scale up your marketing strategy, your advertising budget and Your business as a whole. So without any further delay, this one's very important. You've gotta figure out your marketing, your.

Intake, the new business coming in the.

Top of the funnel. You gotta figure out your customer acquisition cost. So let's talk about that now so you can scale up your business to.

Seven figures plus today. I'm talking about the one thing you need to know about marketing that most people don't talk about because they're trying to sell you something. But if you know this one thing and you stay focused on this one metric when it comes to marketing, it'll completely change your small business. And I know what it did for me, and I know it done for a lot of other small business owners once they start focusing on this one thing. When it comes to a small business, every single dollar you spend on marketing needs to be spent efficiently. And so what happens, a lot of us get buy into this theory that I've got to track. Okay, what leads are coming from Facebook, what leads are coming from Google, what leads are coming from the newspaper, what leads are coming from the door hangers that I put out? Regardless of what industry you're in, it is a good thing to try to maximize the bang for your buck, get more leads, more customers for your marketing dollars. I understand that. But the thing that we focus on too much is tracking and metrics and getting the code snippets and the analytics behind where the lead came from, when what we should be focusing on is just two things, and that is simply customer acquisition cost. I'm gonna do this on a graph and demand. That is literally the only two things you need to know. If you're a small business and you're spending less than several thousand dollars per month in ad spend, if you're spending a bunch of money on advertising, hundreds of thousands of dollars, then it's worth spending a lot of time and energy and money getting analytics doing funnels, having multiple websites created to have them all be all funneled correctly. And you're hearing this from a web design company. I have lawncarewebdesign.com and homeservicewebdesign.com I know for a fact that if someone is trying to sell you on the idea that you, as a small business owner that does a couple hundred thousand dollars in annual revenue and spends a few hundred dollars a month in ad spend is going to somehow not need multiple websites and different funnels and lead pages and a whole bunch of they're trying to sell you something or they're trying to make it Sound so complicated that they need to sell you their marketing services. That's just the honest truth. At the end of the day, for most small businesses doing under a million dollars in annual revenue and spending less than several thousand dollars per month in ad spend and advertising budget, these are the two things you need to know. And what you need to do is, is you need to figure out when, what part of the year is your customer acquisition cost and demand varying? Demand and customer acquisition costs are inverse. They have an inverse relationship, meaning that if demand goes up, your customer acquisition costs will go down. Let me explain, and let me show you why this leads to some of the biggest issues in seasonal and small businesses. So we look at demand. I'm going to take lawn care and landscaping for an example. But this applies to any small business that has any seasonality whatsoever. And if you're like, oh, no, I'm a retailer, I don't have any seasonality. Okay, most of your sales are probably happening the last quarter of the year. That is when demand is going up. So every single business, regardless of what industry, has some level of seasonality or demand that fluctuates. So let's use lawn care and landscaping for example. Though, if I look at the core January, in the middle of the year, I got June and July, and at the end of the year, I got December. This is the course of the year, every single month as I go throughout the year. And when I start out, my demand is very low. In the wintertime, most people don't need my services. It's not super popular. But as we get into spring, it takes off. This is what we call in our industry the spring rush. It is extremely busy for several months. It kind of slows down for July, August as it gets really hot. Then we kind of have a resurgence for the fall season. And then it really kind of comes right back down during December in terms of demand. So this is demand right here. Demand. Now, what I want you to know is that demand.

Has an inverse relationship to customer acquisition cost. What I mean by that is when I look at. Let me actually erase this real quick. When I look at the customer acquisition cost, the cost to acquire one customer, how much do I have to pay in advertising to get one new customer? It's completely opposite to this line graph. So when my customer acquisition cost is extremely, extremely high, that's when my demand is really, really low. So demand low. That means I'm gonna have to spend a lot of money in order to get a customer, because no one needs my service. There is no demand. So what happens though, as time goes on here? Well, all of a sudden, now my customer acquisition cost. This is my customer acquisition cost. This down here, what we just did here is demand, okay? Demand, okay. So customer acquisition cost. I should have really, you know, what I should have done is I should have just done this differently. Sorry. All right, so for lawn care and landscaping, customer acquisition cost very high. Cause I'm in the winter, no one needs my services. Demand is low. But what happens in the spring rush is everyone needs my services, and therefore my customer acquisition cost is very low. Then as the summer goes on, kind of the cost of my acquisition is going to go up because people don't need my services as much. My demand is going down, but then it actually comes back down again during the fall season, people need leaf cleanup, et cetera. But then what's going to happen as the winter happens? My customer acquisition costs are going to go way up simply because my demand is extremely low for my product and service. So why is this so important? Because honestly, the only thing that really matters is when are you marketing? Because why would I want to do marketing when I have very high customer acquisition cost? For the lawn care and landscaping industry, this is the bane of people's existence, is the fact that they spend money on advertising because they're slow. So they spend all of their marketing dollars in the wintertime when they don't have enough work to keep their crew busy. That's when they spend all their marketing. But the problem is, that's when the worst customer acquisition cost is. Because guess what? If they could just spend their money, all their marketing budget during these periods of time when the customer acquisition cost is the lowest, that's when they would get the biggest bang for their buck. And so I believe that timing is the most important part of small business marketing and advertising. Realizing when is demand high and customer acquisition cost low in my industry now, this is the problem. This is the problem for every single industry. Guess what happens during what we call the spring rush in lawn care and landscaping, everybody needs service. Demand is extremely high. But the biggest problem is the fact that we can't. We don't have enough workers. We don't have enough trucks. We don't have enough employees and infrastructure and equipment. So what do we do? We stop marketing. We get some employees, Everything's going good. We're still spending money on marketing. But what happens at the time when our customer acquisition cost is the lowest? The best bang for our buck in marketing is happening. We turn our ads off because we're so busy. So what I would encourage you to do is anticipate when demand is high in your industry. Anticipate that during that time is when customer acquisition cost is gonna be the lowest. That's when you can buy customers for pennies on the dollar. That's when I can buy a customer for, let's say down here, maybe a $20 customer acquisition cost, also known as CAC, where up here my CAC might literally equal $120. I'm getting six customers for the price of one. If I just spend that marketing dollars during the SAL and the timing when demand is high and that customer acquisition cost is the lowest. So what can you do? How does this help you prepare for the times demand is high, customer acquisition cost is low, and allocate your budget, your marketing budget towards those times when you can take that advantage. And then make sure that the constraints that are going to limit you from spending marketing dollars and getting more customers is removed or at least prohibited by having, for example, in this case landscaping and lawn care, you're going to need to have a bunch of employees ready to go. This is why I'm pushing right now, people to hire up for the spring rush. Because there's going to be a massive demand like we've never seen before in America for landscaping and lawn care services. And this is in a lot of industries. That's why inflation is happening. People are spending money, massive levels of demand. Whether or not you're able to actually spend your marketing dollars during the best time of the year, year to do it depends on whether you remove the constraint of labor that will be the constraint in this industry regardless of what business you're in. If you're running a small business, stop taking time and energy and spending money on someone web designer making funnels and how to do my analytics and making sure my code is all aligned and tracking everything that will be much less accurate. When you're doing tens of thousands of dollars, then you actually have a collective sample of data that to actually draw results from. But this for a small business will do dramatically more results and that is figuring out when is demand high and making sure that that's when I spend my money on marketing is during the period of time when demand is high, my customer acquisition cost is low.

All right, so we talked about customer acquisition cost and the best way to figure out your customer acquisition cost is doing marketing. And so there's two things I want to talk about right now. Number one, if you are just getting started, you need to go check out lawn caremedia.com because that's going to be the lowest budget way to figure out your customer acquisition cost. Door hangers, yard signs, flyers, postcards. You can use every door direct mail. But the templates and the designs on there are tried and true by hundreds, if not thousands of lawn care landscaping companies. For every service you could possibly think of, everything from upselling customers to welcoming new people to the neighborhood, there's a plethora of designs that you can use for print marketing for a very low budget. Now, if you're growing your business past $200,000 in annual revenue this year, I highly recommend you check out lawn careweb design.com for just 399 per month. No contract, no penalty fees for canceling, you can get a professional website created in six weeks. This site is going to look extremely professional. You can go on our site and check out the different designs that I've created with the team. We have over 300 lawn care and landscapers that we have created their website for. And you can see some of the designs. They're all custom. I stand behind them 100%. And that's why we do subscription model because you can cancel at any time, you can keep your domain, but I promise you the search engine optimization, the SEO, the constant design changes that we are making to your site is absolutely worth it. And furthermore, you can cancel like at any point in time and you can make as many changes as you want for that 399 per month. You don't have to pay $10,000 to get your website built. Get up and running within six weeks and get leads today. Go check out lawncarewebdesign.com, no contract, unlimited changes. All the search engine optimization you could ever want is gonna be included in that subscription of 399per month.

Now, as you scale your business, the.

Most important thing you have to start keeping an eye on is your overhead and the amount of money that you're spending on labor. Because your biggest variable expense in your business is labor as you scale up a business. Cause when you are so low, when you only had maybe one employee, a very small portion of your revenue went out the door every day to to wages. Not very much if you were working by yourself, like almost nothing. It was just you, maybe one employee. You're paying 15, 20% of your revenue is paying this part timer to help you out. But as you scale a business to seven figures and beyond, you've gotta have a handle and you gotta know exactly what your efficiency is for Your labor expenses. The number one way to do this is through P4P, or pay for performance. So in this video, I'm gonna break down how P4P works in a very simplistic way so you can understand why hourly wages is something that makes it so difficult for you to get out of daily operations. This is why I see owners that have millions of dollars in operation and they're big businesses, but every single day they are stressed out of their mind. They're micromanaging their team. They're constantly watching them, tracking their trucks. Why are you on your phone? They're showing up at job sites just to see if they're working. Pay for performance is the thing that alleviated all of that stress and anxiety and micromanagement from myself and allowed me to start working on the business and working on other businesses because I didn't have to worry about my crew working throughout the day. I knew that they were trying to do their very best. The harder they worked, the more money they made. And that's what I truly believe everyone should have in their company. So I'm going to go pay for performance and how you can switch away from the hourly wage method. Because I was struggling, I wasn't making any profit. And literally I changed to P4P away from hourly. And since that day, have never had someone ask me for a raise. Whereas the three weeks leading up to P4P, I had four people ask me a raise and I didn't even have the money. And they're asking me for raises. And I was like, man, I need them. We're in the spring rush. But I couldn't afford it. And P4P is what allowed me to be able to start paying a lot more in wages. And if someone ever asked me for a raise, I wouldn't give them an hourly base pay raise. I would just say, look, look at the scoreboard. There's other people in this team that are making 5, 10, $15 more per hour than you. You can go learn from them. Watch what they're doing. Watch how efficient they are when they come to the shop in the morning, they get their keys and they're out the door. Watch how they pack their lunch. Watch when they get to a job site, they're out and they already have a plan in place. They've already looked over their job notes in their job video. These are the type of things that P4P allows you to do because it creates a meritocracy in the business, which means if you work hard, you make more money. If you're lazy, you don't make as much. I think it's pretty fair. And so honestly, P4P changed my business. And everyone always thinks like, oh, you're trying to sell software, because I do. P4Psoftware.com is something that I sell. I sell as a subscription and we don't make any money on it. Right now I literally put every single dollar back into the production and, and the development of the software, making it better. But I truly believe it's the way of the future and it's the way for you to get out of the business's daily operations and stop micromanaging your best team members because your best team members don't want to be micromanaged. Without any further delay, let's break it down very simply and I'm going to actually show you inside the software how to calculate pay for performance. And if you want more information about this, I have an entire course with hours of lectures. Go to mikeandies.com P4P completely free, mikeandys.com the letter P, the number 4P.

Go check it out.

And it's completely free, so feel free to check out the book on Amazon, but you can just check out the course for free, completely free@mikeandys.com P4P alright.

Let'S go to the whiteboard and talk.

About pay for performance. I'm gonna explain today why paying your employees by the hour is lazy, ineffective, unprofitable, and again, all your best talent is not going to be going to a dollar per hour business in the future.

I believe that paying your employees by the hour is lazy. There's a more profitable, more efficient way that you can pay your employees more, be able to retain them, and they are able to see the fruits of their hard work. Today I'm going to show an actual project being done. And I do lawn care, I do landscaping. This works for any home improvement business when you have project based work or recurring jobs on a route. And today we're going to be watching a project that's being done. It's a BlackBerry bush removal, literally clearing out BlackBerry bushes. It's not fun work, but it's work that needs to get done. And this customer specifically wants to haul.

The debris out of there.

They didn't just want it chipped away.

So today I'm going to walk you.

Through the entire job, show you the notes, show you the actual job being done, and show you how much money the employees made on what we call P4P, which is pay for performance, the replacement and the alternative to dollars per hour.

So as I continue with the video, keep watching the video here of the actual project being completed. Because when I'm done talking, giving my.

Little spiel, I'm gonna go to the.

Whiteboard and we're gonna go over the numbers of this specific job, the real numbers. So here are the job notes. It's a property cleanup. The project area is only the backyard. We're gonna knock down the BlackBerry bushes and the grass and all the undesired growth and anything that's encroaching on the house, we're gonna rake out all the leaves, remove all the debris all and haul it to the dump.

We're going to also make a video.

For the crew so they know exactly what to do and the estimator doesn't have to come back to the property. And it also says the client had to obtain permission to park the Augusta truck at the next door neighbors to load debris. Must have been just way easier for them to be able to get access to the backyard. So on this project, we have 32 budgeted hours. That is how long we expected this job to take. So watch that as I begin to talk. Keep an eye on it, because I want you to think about how long you think it would be taking them and then we're going to break down the actual numbers, how long it actually took them, how much money that was made, as well as how much they would have otherwise made if they were just getting paid by the hour. Okay, so why do I think that paying an employee by the hour is lazy? It's lazy because it's very simple to do and everyone understands it. And just because everyone understands it and it's really, really simple and it makes a lot of sense and it's been done for tens of years, decades, hundreds of years, does not mean that it's right or the best thing thing for the business or your employees. Now, because I make social media content and stuff online, people bash me all the time.

You don't care about your employees and.

You, you hate employees and you're so a miser and you're greedy and all the rest. And that's fine. But ultimately the number one reason why I started pay for performance P4P because I was just so unhappy with the fact that I could not pay my employees more. I wanted to be able to afford to pay them 25, $30 per hour when they were working really hard and deserving every single penny of it. However, in lawn care and landscaping, we don't have 50, 60% profit margins. We are not a tech company. We have thin margins and we need to operate on them. And so I wasn't able to give away a dollar per hour, 25, $30 base pay for some money. Somebody that has very little skills or just getting started in the lawn care industry. But if they have a family, like, I felt bad, like I could not provide for them when they worked so hard. So it's like, we'll just give them a raise. Well, then how do I give someone a raise? Based upon if the business can afford it, based upon if they work hard in front of me, Based upon, like this. In traditional workplaces, this is how people get raises. Look good in front of the boss. Take the boss out for drinks on the weekend, you know, get cozy with them. It doesn't matter about what the team thinks about it. Just as long as your manager or boss thinks you deserve a raise, then you'll get a raise. And then a lot of times raises go to the people who just ask for them or need them the most when that's not fair. What should be done, if you have a meritocracy inside the company, is the harder you work, the more money you make, the more you contribute to the business, the more money you make for the business, the more money you should make. I believe to my heart that every single employee wants to be paid this way. The more they contribute to the business, the more money they make. Now, how you create a system around that is the hard part. And that's why people don't do it. Because I think 99% of business owners would agree with me that they would rather pay people based upon their performance compared to just how much time they spend on the job. However, the thing that they then don't take a step on, the thing that makes it difficult to do that they shy back from, is, well, how am I going to calculate that? I've got to create parameters and rules.

And I've got to create this question.

Whole framework a game and present it to my employees. And they've got to understand it. And it's challenging.

It's not easy to make this massive.

Switch away from what everyone understands, which is dollars per hour. But this is what I want you to think about on dollars per hour. The employee and the owner are going in different directions. The employee wants the job to take as long as possible because the longer the job takes, the more money they make. Whereas the owner wants the job to take less time because the less time the job takes, the more money the business makes. When, if you do pay for performance where they get a percentage of the labor revenue that they earn for the job. Gu, you're now both going the same direction. The owner and the employee wants the job to get done as quickly as possible and to a high enough quality where there's not callbacks and the customer is satisfied. That is what P4P is. Pay for performance is a way of paying your employees by how hard they work and how efficiently they work and how profitable they are for the business instead of just how long they clocked in. Whether or not you need employees more, so you bump up the wages more. Whether or not you know somebody that, oh, they work for 15 years with the company so they make more money, how is that fair that someone who's just worked with the business for 15 years makes more money than the person that just got started two weeks ago? But hustles, shows up really early, is educating themselves, makes twice as much money for the business, doesn't spend 45 minutes at lunch taking a nap and then 15 smoke breaks and 48 bathroom breaks and three lunches and siestas throughout the day. These are the employees that deserve more money. But why does it take them 15 years to earn it? Why should you have to stay out of business for 15 years in order just to get a half decent wage? You should be able to work hard and within a matter of a couple weeks of getting trained up, be efficient and profitable and be able to make more money for you and your family. And by cutting out all the waste in the business, the business can still be profitable and more profitable to the point where they can afford benefits. We are able to afford health benefits and profit sharing. Once we instituted pay for performance on hourly, we were scraping by and people are like, man, you're really passionate about P4P. I've invested hundreds of thousands of dollars in develop.

Because it completely changed my relationship with my business and with my employees. And now I know I feel a lot better knowing that if someone works their brains out all day long for us mowing lawns, right now they're making 26, $27 per hour on average. There's people making over $30 per hour and they don't have a degree, they don't have a lot of skills, but they work their brains out and they deserve every single penny of that. But in the past I could never afford to pay everybody that.

And it was just so hard to.

Gauge or measure or track who was actually driving business results and deserved a higher compensation package. So for everyone in the comments that says, well, how are you paying employees so much that the business will just become unprofitable? No, by cutting out waste that serves nobody, doesn't serve the customer, doesn't serve the employee, and doesn't serve the business. By cutting all of that out, that's how you're able to afford to pay the employee more and still the business be profitable. And the best part of it all is that now the system of P4P is managing the employees instead of you micromanaging and looking over their shoulder or rolling up to them on jobs, always texting them like, hey, what are you doing? Why are you at so and so's house? Why are you at the gas station? I saw you on your phone. What are you doing? I don't do that anymore. Because, like, look, if they want to be on TikTok for half the day, that's fine. They're gonna make less money on P4P. That's their decision. And I believe that most employees don't want to be micromanaged, especially the top performers. They don't want someone looking over their shoulder and doing quality control by rolling up on them at a job. They just want to be able to do their job to the highest extent and the highest level. And if they're getting paid, because based upon that performance, the happiness of the customer and the speed at which they do the job and the efficiency and profitability that is brought into the business, I believe it's a win, win, win. So now that you've heard me rant about this, I'm gonna go to the whiteboard. I'm gonna break down this job that you've been watching them doing, this BlackBerry cleanup. We're gonna break down some of these numbers. And I truly believe that this is something you should consider. P4P software.com training, free videos on how to institute this in your business.

And if you want to use the.

Software I believe in, it'll save you a lot of time, because it only takes one minute per day per employee to calculate these numbers every single day. Let's go to the whiteboard and break down this job.

Okay, we're at the whiteboard. Now let's walk through this job and actually go over what happened with this project that we've been watching. So, first and foremost, the budget hours, 32 hours. That is what was determined by the estimator. And this is labor only. We're not going to talk about the debris or estimate fees or any other costs besides just the labor. Because the only thing that matters when it comes to P4P, employees don't get a percentage of the revenue. They get a percentage of the labor revenue. And on this job, let's just assume that we are charging $80 per hour for this work. I think this local location does more like 90. I don't remember, but let's just use 80. If we used $80 per hour and that's what we're charging for labor, that would mean that the labor revenue equals 2,500 DOL as a total labor revenue. Now there's two employees in this job, as you saw. And now what we're going to do is walk through three different scenarios. Does the job take them 24 hours to do? They crush it. They beat budgeted hours. They hit budgeted hours. They match what was expected in terms of how long the job was going to take, or does it take them longer than expected and it takes them 38 hours to get the job done. So here I've wrote how many hours each of the employees would work because again, there are two employees. So there's 24 clocked hours. That would mean that both employees work 12 hours each. So let's break down the math. And this is the beautiful thing about P4P and pay for performance is I'm giving them a percentage of the labor revenue. I'm going to assume in this case that I'm giving a 33%. Okay, now on P4Psoftware.com you can customize that, you can change it. You can change it based upon the type of job or services, that's fine. I'm just going to assume 33% or 1/3 of that labor revenue is going to the employees. What that means is before the job even starts, I know that the total wages paid out to the employees on this job is going to be $853. Does it matter how long it takes them? Again, they're incentivized to get this job done as efficiently as possible and make sure the customer is happy so there are no callbacks. They're going to do a walkthrough. They're going to make sure the customer's happy. But ultimately, before the job starts, doesn't matter if the who's working on the job, who my most efficient people are. It doesn't matter the weather, it doesn't matter what happens to the equipment. I know my wages will be $853 on this job. I would much rather have a fixed expensive labor than having it always all over the place based on whether or not people will want to work that day, whether they feel good. All a host of different types of variables that come into play and affect your profit margins as a business. Alright, so I know I'm paying $853 because that's one third of the labor revenue and that's a fixed expense that I know I'm paying on P4P. Now the question is, well, what does the employee make? So let's go ahead and calculate this. If we take $853 and we divide that by the 24 clocked hours, if they get this job done and they really crush budgeted hours, they're literally going to make $35.54 per hour on this job. That's incredible. Now they deserve the $35 power. Some people are like, oh, they don't. This is entry level work. That's insane that you're doing that. I just watched them and anyone could do that after a day of training. You're right, but they kicked butt and they worked hard the entire time. They beat budget hours literally by like what, 20, 30%? They deserve $35 per hour because guess what? If you didn't have this P4P option where they got paid based upon how quickly they got and efficiently they got the job done, guess what? They would have make it. They would have made sure it took 32 hours. They would have taken more breaks, the drives, the dump would have been a lot longer. Longer lunch, more smoke breaks, more going to the bathroom, more on their phone, all of that would have happened. I guarantee you, when employees are getting jobs done faster, if there's no incentive for them to get the job done quicker and more efficiently and more profitably, they're not going to. So the fact that they cut out all that extra wasted time, that's how I'm able to afford to give them the $35 per hour. Alright, they crushed it. They absolutely annihilated it. Now let's go ahead and assume that they hit budget hours. So. So it takes them as long as was expected in the job. So it's going to take the 853 because again, that is a fixed amount that we're going to be paying the employees. And we divide that by the 32 hours it took them to do the job and now they're making $2665.66 cents. Alright, so $26, not bad. They hit budgeted hours, they got the job done in what was expected of them in terms of the estimated time. Now usually about 4 out of 5 jobs we are Going to be able to beat budget hours. But there's going to be times when things go wrong. Weather changes, maybe something wrong happens on the job. You're starting to dig out something and you hit a rock. If you're doing a digging job, whatever it is, there's always things like that in the job. But I want to make sure as the business owner, I fixed my amount of wages so I don't have massive variety like oh, 10% profit on this job, 80% profit on this job. Oh, negative, I lost my shirt. 50% on this job. When you have those fucking fluctuations because of labor being so variable, that's why you lose your shirt on projects. And you have months. We do really good and months where you do really bad. So still the same $853. Let's assume that maybe they either could be a host of reasons. They could be A lazy, they could be A bad, not trained correctly, c bad weather. 4 a lot of times is what happens. They run into unexpected and unforeseen things in the job the estimator did not account for. Okay, well let's go ahead and do the calculations here. We have $853 in wages that we're paying. Let's divide that by the clocked amount of hours that took them to do the job and now they're only making $22.45. $22.45. Alright, not great below the average that's currently at this location. If they take this long. But ultimately not horrible. What you're protecting yourself against on P4P is this job taking 60 or 70 hours because someone just wants. They're happy with base pay. They're happy with 18, $19 now that you give them as an hourly rate. So what do they do? They just SAP the clock. They just take tons of time. And all that wasted money is why you can't pay your top performers what they deserve. And they go out and kick butt every single day. The reason most business owners won't make this change is because this makes them afraid. It's a whole lot easier for them to say, oh, 24 hours. That's how long you took the job. Great, I'm going to multiply that by $20 per hour. There's your paycheck. I'm sorry, I'm just being straight up with you. You are being lazy. If you're just paying dollars per hour and giving raises just infrequently and randomly, like, why is someone getting paid more simply because they are, you know, hit a milestone of a year or two years or three years, they're not bringing any more revenue to the business. They should be paid based on results. And if you want to create a culture where people are motivated to get work done, cut out waste and figure out ways to make the jobs get done fast, you better be making sure that incentive programs are in place to reward that action as soon as possible. Not quarterly, not an annual bonus, but every single day. They get paid based upon their performance and how quickly they get the jobs done, while also retaining a high degree of customer satisfaction. Because I know everyone's out there like, oh, no, if you make people go faster, they're not going to be able to do a good job and they're at low quality.

Okay, great.

Go watch the videos on P4P software.com training. We've thought this part through. We've thought about all the ramifications, and we've ironed out the kinks. Please, I beg of you, if you're in the home improvement industries, please go check this out. This changed my business forever. It changed my relationship with my business, and it changed my relationship with my employees. No more micromanaging, no more playing favorites. They don't have to feel like they have to, like, look good in front of the boss. They know that the results speak for themselves, and it speaks speaks for their paycheck. And if they want to work harder and make more money, they know exactly what to do. Go talk to the people that they can see on the leaderboard that we share on the software. They can see who's making the most money. They can go talk to that person. They, hey, I got to learn from you. I got to make, you know, I got $300 extra car payment I didn't know I was supposed to have this month. I got to make some money. Can you please show me what you're doing to get ready for your jobs? Be more efficient, cut out waste and beat budget hours. That is the type of culture I want to be around. And I truly believe it'll change your business. It'll change the lives of your employees. You'll be able to pay them what you want. I truly believe most business owners in home improvement industries really do want what's best for their employees. They're good people. They want to pay more to their employees, to the ones that deserve it, the ones that are actually doing the hard labor that is not fun, not exciting, but they're getting it done to provide for their families, and they want to be able to provide more for those families. I truly believe P4P is the solution. I beg of you to do, do the hard work. It's not easy to switch, but once you have done it, it's the best thing you'll ever do for your business. Take the time, take the effort. We're heading into the winter season. This might be the time to take a few months, use the software on the back end. You can use it for an entire month for completely free. I'm also gonna allow you to talk to a CPA on our team, a certified tax accountant that is able to actually walk you through any questions you have about P4P. And this is a massive cost to me, but I've just seen it change my businesses, change the businesses of our August of lawn care franchisees. And I desperately want this to happen for you. So please check it out. We're constantly developing and improving the software. It's not perfect. I'm not like Google or Apple here, but we're making it better every single day, every single week, we're adding new things to it and I truly believe it will change your business.

All right, I hope that was helpful. Definitely. Check out P4P software.com if you want more information. Want to check out the software, you can sign up and for the first 30 days you don't have to pay anything. Check it out. Now we got to talk about taxes because when you start growing your business to a million plus, you're going to have a tax bill and you got to make sure that you have the strategies in place to save money on taxes. So let's go talk about taxes and some of the myths around taxes. Because if you're not making a profit, there's no reason to be thinking about section 179s. Let's go and play the tape.

I'm going to walk you through knowing the numbers of whether or not you should be taking write offs and going out and buying equipment or trucks or spending money on things now instead of in the next few months that would go into the next year. So I, I want to make this video because I know in the next week or two there's gonna be a bunch of different influencers make videos about this in the community and they're going to be talking about write offs, write offs, write offs as if it's like free. And I'm gonna explain to you what the actual savings are in having a write off at the end of the year. And so we're gonna jump into that. I can make this probably an hour long video. I'm gonna make into like hopefully 8 to 10 minutes. Alright, let's talk about write offs. So everyone's like, hey, I'm gonna go buy a truck, I'm gonna go buy a piece of equipment because I need to get less. I don't want to pay as much taxes. So these are the tax rates if you're married and these are the income brackets for that corresponding tax rate. Now if you're down here at the bottom Anywhere from 24 to 37%, I would actually recommend and you might want to start thinking about the fact that you might want to actually pay more taxes this year because there's a really good chance over the next couple years taxes for this group of people is going to go up. So you might actually want to realize some of your gains. So that way as the tax rates go up on these higher rates of income that you do actually not pay as much taxes. So that'd be my first recommendation. I'm not going to stick in this area as much because that is a very small subsection of the listeners here. I'm going to be talking about those of you who are making zero to $100,000 in profit. And again, the only reason you even think about doing a write off is because you have profit at the end of the year, if you like. My first three years of starting Augusta Lawn Care because we are growing so fast, like $200,500,900,000 because we did that and I was buying more trucks and equipment and inventory and all the rest of it. I didn't have any profit and I'm not ashamed of it. I was growing really fast and growth sucks cash. So therefore the actual bottom line profit, even though we were growing and doing well, was like zero or barely anything. Now I'm gonna explain today why it's crazy to be going and buying a bunch of stuff when you're making like $50,000 in profit or 40,000 or 50, $63,000 in profit, or you do this part time and you're a student to go out and buy things as a write off. And then people just like make stupid purchasing decisions under the guise of like, oh, it's a business expense, I can write it off. And they don't run the numbers of what they're actually saving. I think most would be shocked by the fact they're maybe saving 10 to 20%. And furthermore the fact that you're just kicking the can down the field to next year when you're going to have more gains and you've just bought an asset that you fully depreciated Section 179 on your taxes and you take all of those that depreciation on that asset in one year on a section 179, well, next year you don't have that asset to write off. Now there's nothing more to depreciate. So everyone here on your Form 1040, you're going to have to fill out whether or not you're going to get a deduction of either A standard deduction, I should write this up here. A standard deduction. Standard deduction. Standard deduction, or you're going to get an itemized deduction. Okay, so a standard deduction says basically, hey, you at least get this amount reduced from your income before we start thinking about taxes. You get a standard deduction. And if you're single in the United States in the year, you get a standard deduction of $12,550, which essentially means if you make up to that amount and you're single, you don't pay a single dollar of taxes because you get a deduction right off the top. If you're married, you get a standard deduction of $25,100. Now on your Form 1040, you get to choose whether you're going to do a standard deduction or an itemized deduction. The only reason you would do an itemized deduction where you take off like charitable contributions and your interest that you pay on your personal residence and those sort of things, the only reason you take an itemized deduction is if your income and those deductions, I should say those deductions is greater than the standard deduction. So this is like the minimum deduction you can have. Alright? So I'm going to use those numbers to be as conservative as possible. Now over here, what people fail to realize is they think, well, if I'm going to in a tax bracket of 32% and I make $332,000, that I'm going to pay 32% of that to the government. And that's wrong. What's going to happen is you're going to pay 10% on the first 19,000. Again, this is the income brackets. If you're married, you're going to pay then 12% on this bracket from 19,000 to 81,000, you're going to pay 22% on this range and then you're up only going to pay 32% on that last few thousand between 329,000 and 323,000, for example, or 332,000. So you're not going to be at 32% on the majority of your income. So you've got to remember first and foremost, let's just assume, let's assume that I have, I made $100,000, I made $100,000 in profit in my lawn care, my landscaping business, just for example. Alright, so let's start off at the top here. Income equals $100,000. And let's just say for the example that my wife helps me in the business. And therefore this is our combined tax return of $100,000 in income. First and foremost, I'm going to get at least a standard deduction, at least a standard deduction of, of $25,000. 25,100. So that essentially reduces my income down to $74,900. Okay, now this is what I pay tax on. But guess what, if I go over here, you say, okay, well that means you're in the 12% bracket. Great. Actually, no, I'm not. What's going to happen is I'm going to have a 10% tax bracket for the first 19,000, $20,900 and then on the remaining what would be 20,000, so we. 54,000. 54. 54, 54, 909. Okay, I'm going to do this wrong, but let's do 54,000. Yeah, 54,000. 54,000. Boom. The remaining 54,000 of my income. That's where I'm going to get taxed at 12%. Okay, did I do this math correctly? I think I did. One, two, three. No, I didn't. This is 55. Let's go. Okay, so that's how my taxes are actually going to look like. So if I actually do the math on this, if I add all of this up, I'm probably going to end up paying about, I'm just going to round this off around $7,000 in taxes. So the reason I'm saying all of this is because, because people that go out and get $100,000 profit in their lawn care business is like, oh, I've got to go do write offs because I've got to save money on taxes. And again, these are federal income taxes. If you have state taxes, there might be an additional 10%, 8%, 6%, whatever taxed on top of this. But if you live in Washington state or other states that have no income tax from a state level, this is just federal taxes. Alright, let me just make that clear. But again, $100,000 profit, money in the bank, maybe they did 4 or 500,000 in revenue. But at the bottom level of the line, $100,000 in profit. Immediately that standard deduction takes it down to 74,000. I'm going to pay 10% on the first 19,900. I'm going to pay 12% on the remaining 55,000. And I'm literally going to pay. I am literally going to pay around $7,000 in taxes. That's 7%. So if I'm going to reduce this number by taking ride offs and buying trucks and equipment, I'm literally saving 7% of my original income here. Okay? I'm literally saving like, let's say I spent a $30,000 on a truck, okay? That means I'm going to save. Let's just make this right here. So $30,000. And I'm not saying you shouldn't do a section 179 and write things off. I'm not saying you should not do that. I'm just saying that people drum it up as if it's like free. They talk about like, oh, it's a write off. I can just buy more. Okay, so now let's assume that you've bought a $30,000 truck. This is what's going to look like if you bought a truck at the end of the year for $30,000. Okay, what happened? Well, I got a deduction. So instead of having $100,000 income, it went down to 70. Great. Okay. Well, after my standard deduction here, now I'm only going to be taxed on 44,900. The first 19,900 of that is going to be taxed at 10%. The next 25,000 of that is going to be taxed At 12%. So essentially what happened is I saved $30,000 at a 12% interest rate, which means I saved about, I'm just kind of rounding here about $3,400 by buying a $30,000 asset. So you got to ask yourself, am I overpaying right now for this asset? Am I overpaying and doing it under the guise of a write off when I'm literally saving 10, 12%, maybe even less. If you're making less than $100,000, if you're making like 30, 40, $50,000, there's a good chance you're actually not saving any money because your standard deduction wipes out most of your profit anyways and you're literally down in this tax bracket here. Okay? So if you, number one, did not make any profit because you're growing really fast, you're investing back in the business. There is no reason to take tax write offs. In the end of the year. There is nothing to have a deduction on. You have no income. Wait for it next year because potentially if you hit year three, four, five and we start becoming very profitable, you're going to want all of those deductions. Then you do not need deductions when you're at this. I would not like, if I was down here, I'd be like, I'll pay all the taxes I possibly can. I'll amortize all my trucks for five years because I want to take my tax breaks. I want to take those deductions when I'm actually going to need them and I'm making a bunch of money. A lot of people take all these Section 179s on all of their equipment, all their trucks as they're growing and then they wake up and they in year four or five like making all of this profit, they have no expenses and they have no section one because they section 179 everything off in its first year and took that deduction. They have nothing to depreciate. There are no assets to take deductions on in form of depreciation. So what's the takeaway from this? Not that you should pay more to the government unless you're in these tax brackets down here. I think you should, because in the next couple years I can guarantee you one thing. Taxes are not going down. So if you're in this bracket, you might actually want to realize some gains, pay some taxes. If you're in this bracket here, just know that you need to run the numbers and that just don't get buy into the hype of like buy it before the end of the year for tax savings. Buy trailers, buy trucks, buy equipment, pay pay way in advance. It's like, look, just the time value of money, the fact that inflation is at 7, 8% right now would literally be the savings that I'm getting almost from just if I kept the money for another 10 months until I needed the same thing next year, Let alone if I buy a truck and I buy it four or five months before I need it and now I'm paying insurance and registration on a truck that I don't actually really need until April or maybe. But I'm doing it because of tax savings. But really all 3400 of my tax savings just got wiped out because of taxes, insurance and registration that I have to have on that truck for five or six months when I Don't really need it.

All right? If your CPA currently just prepares your taxes and that's it, and you have no strategy, you have no planning, they don't think about how you can save more money on taxes and have a talk with you halfway through the year and not just when you're putting your taxes together. Highly Recommend checking out homeservicecpa.com I personally work with Brad, Lisa and the team, and they can do your taxes, they can do your payroll, and they can do your bookkeeping. They can give you like your quarterly reports, reconcile your bank statements. It's phenomenal. Get your profit and loss statement done, your balance sheet done, and they can just do your taxes. And they're all separate services you can choose from. Highly recommend them. When you're talking about your CPA and people that are giving you financial help on the back end with bookkeeping and payroll and things like that, there's two things I'm looking at. Do I trust them and do they give me education?

Cause I'm not just paying for them.

To do the job. I need to trust that they're doing the right thing for the business. And secondly, I want to actually learn and understand what they're doing so I can be educated. And that's what we try to do@homeservicecpa.com Brad has been working with me for over five years now. Lisa's been working with me for over eight years. They personally do my bookkeeping. They help me, and they have for many years. So definitely check them out. They'll be a great service to you if you need your taxes done, if you need payroll ran, if you need or if you need your bookkeeping done, getting all your financials in order, getting your bank statements reconciled, making sure your QuickBooks is nice and tidy. So go check it out. All right. Now, buying equipment is something that you should talk about with your cpa. And before you buy a big piece of equipment, you should talk to and see what the ramifications are from a tax perspective. But now I'm going to talk about specifically buying trucks and equipment via leasing it, buying it for cash, or getting debt on that truck or piece of equipment. Now I'm going to talk about trucks specifically in this one. The vast majority of us, the biggest asset we're going to be buying as we grow our businesses is going to be trucks and vehicles. So the same could be applied, though a lot of times for things like equipment, assuming that there's a leasing option for the equipment that you're trying to look at. But I'm going to talk about these three different options of financing your growth because you're going to need cash as you grow. Your business growth sucks cash. The problem is, do you use the cash or do you go get debt and take a little more risk on, or do you do a leasing program? So let's talk about all three of these, what the pros and the cons are of each and when you might want to use each of these inside of your business. So let's go ahead and talk about trucks and the financing options that you have.

Today. We're going to be talking about whether you should lease your trucks, whether you should buy them with cash, or whether you should finance them and use debt and loans to buy your trucks. Because I truly believe a one size fits all approach does not work. Size matters when it comes to the type of advice you're taking and the size of your business matters in terms of what type of financing you're going to use for your trucks. So let's break down the good, the bad, the ugly, and the ideal case scenario of what type of person I feel should be leasing, buying their trucks with cash or using debt. Now let me preface all of this by saying that when someone does leasing or debt for simply tax savings, you need to be very careful taking their advice. Here's why. Most of the time when people talk about buying fancy trucks for their business, they somehow talk about in their 5th or 6th or 10th year of business, about how they had this premonition or this thought, they should go ahead and get really fancy nice vehicles and brand new all the time. And they had this change of heart because of their tax situation, because it worked well for them, does not mean that the person getting started, the person doing 100 or 200 in annual revenue, should also go somehow get the cheat code. And that is go get a lease or go get a bunch of debt. Case in point was at Landscape Summit just a few weeks ago we had Tommy Mello, who has a business that does well over $100 million in annual revenue for garage doors. And he was speaking on stage and he noted the fact that he thought people should get brand new vehicles for their, for their employees and for all of their trucks when they're out working throughout the day. And although I agree with what he said for his use case, what a lot of people missed that were listening was the fact that he did that when he was doing over $5 million in annual revenue and in an extremely profitable business that he needed to save money in Taxes on a section 179. So although I'm going to mention tax incentives, when it comes to leasing and debt, which there are, certainly they are there. The reason they are there is because the government knows that by increasing the amount of consumption and you buying more stuff, it's going to help the economy. Buying more stuff does not help your business. And so let me be very clear that if you are a massive company, leasing, getting financing definitely will help you when it comes to tax incentives. You'll be able to write things off, take advanced depreciation in the form of the section 179, be able to get all of, you know, a lot of tax savings. But for the person that is making hardly any profit, going out and getting these pieces of equipment for tax purposes does not make a lot of sense. If someone is making 500, $600,000 in annual profit and adjusted gross income, like $500,000 on their tax return, like that's their taxable income. By them going out and getting a section 179, they might be saving 40 or 50% on taxes because of their state and the federal tax rate. Whereas if you are making 30, 40, 50, 60, $70,000 in annual profit and what you actually show on your tax return to the government, the IRS, you going out and getting a $100,000 truck so you can get a section 179 is going to help you very little. You might literally, after standard deductions and other things that you can take for like your house mortgage and things like that, you might literally be looking at a 5 or $6,000 tax bill. And yet you're going to go somehow say that you're going to buy $100,000 truck, $80,000 truck, to warrant saving 5,000 or $6,000 in taxes. It's absolutely crazy. So if you hear someone saying that they're doing section one stage and they're financing and getting a whole bunch of debt, if they've been in business five, 10 years, if they're super profitable, if they have other businesses that are bringing a lot of very profitable revenue to them, keep in mind that they are saving a lot more on taxes than you. For the same piece of equipment that they purchase on a section 179, talk to your CPA. I suggest using homeservicecpa.com now let's go through leasing, buying with cash, and then using debt. Number one, leasing a truck. Now, there's different forms of lease. I'm very aware and I know some people are going to disagree with me, because of there's different types of leases, but just using the standard type of lease, you're going to usually have some sort of down payment. And then you're going to pay it over the course of 24 or 36 months. And then you have the option to buy it out or trade it back in for a new leased vehicle. So the pros are you're going to always have new trucks every two or three years. Brand new trucks. It looks very professional. It's always looking good. And, you know, two, three years is a great time to always get new trucks. Your guys are gonna love you. Your brand is gonna look on point. You're gonna have no maintenance or repairs. Cause when you lease a vehicle, they're gonna take care of the oil changes, they're gonna take care of the tires and the brakes. Everything typically is completely included. So no downtime virtually because you have a lease. A lot of times they'll even do like a lease replacement program, which is like, if something goes. If something breaks down, they'll give you another truck. It's pretty awesome because you don't have to worry about maintenance, repairs at all. Massive tax incentives, because even though you lease the vehicle and you technically don't, quote, unquote, own it, you can still take massive deductions on your taxes. Talk to a cpa, but you can definitely use advanced depreciation still on these vehicles. And what's the best thing about a lease is very low down payment. You might be looking at 15, 20, maybe 25% down payment on a vehicle. So if you're buying a $30,000 vehicle, you might be walking away with seven, $8,000 down payment in order to get that $30,000 truck. Great. Now let's talk about some of the cons of leasing. Number one is that when you have a lease, because you aren't theoretically the owner of the vehicle free and clear, your insurance premiums are going to be very high. They're going to require certain limits that are extremely expensive when it comes to insurance. Very low deductible, having full comprehensive and collision. And I know some people are like, you should get all insurances. That's fine. But if you're going to take it from $100 per month, if you did liability only, and slightly higher premiums or slightly higher deductibles on your comprehensive. And now you switch it to where you have to have a 500 or $250 deductible. You have to have max coverage on everything. You might go from $100 a month to $300 a month just on your insurance for that vehicle. Very important because everyone always takes into account the lease payments, but they don't take into account the fact that your insurance might double or triple because of those advanced premiums and deductible changes. Also, some cons with the lease. If you're not planning to buy out the lease and you actually are willing to get the new truck every couple years.

It'S frowned on. If you're painting the truck or modifying the truck in any way, if you're stripping off the bed, if you're painting the vehicle, lost a marker if you're painting a vehicle, all of those sort of things, not great for a lease, especially if you're trying to cycle them through. Now, if you decide not to cycle them through, but rather buy it out at the end of the lease and actually own the vehicle, there's a very good chance, especially if you're in the home service industry, where there's dings and dents and lots of wear and tear in the vehicle, there's a very good chance that the amount that you have to buy it out for is actually higher than the blue book when it comes to buying out the truck, because you might pay 15, 20% of the upfront, and you might pay another 10 or 15% off over the next couple years in terms of the principal. However, you're gonna be buying this thing out and you might still owe like 70, 80% on it, and it's worth 50 or 40% of what you purchased it for originally possible. I know that in crazy times like 2020 and 2021, things went up in value, but that's not standard. That has never happened. And I don't predict that happening in the future. Who this is ideal for leasing trucks is going to be for people who are trying to maximize tax incentives for established businesses that have extremely high margins, has lots of profit because again, your highest $100,000 as a deduction on your taxes might save this person 40 or $50,000 in taxes. And someone that only has 50, 60, $100,000 in adjusted gross income that they're actually reporting to the irs, them getting a very nice truck, they literally might be saying 5 or 6% on taxes. So very important. That's why a lot of the more established, bigger companies, they'll do the leasing programs with equipment or truck manufacturers is for that reason also very ideal for a company that is established and wants that premium brand. They want new trucks and they want their brand to be affiliated with Always new, always clean, never breaking down and always looking extremely premium. Great for being able to have a premium brand and therefore have a premium price. Now let's talk about buying things with cash. So the pros of buying things with cash is that you have the ability to have lower premiums on insurance because you are not required to have as comprehensive of insurance. Instead of a $500 deductible, you might have a $2,000 deductible and that's okay and you don't mind. And you might not have comprehensive or collision type of insurance premiums on the truck. And that again might save you 100 or $200 a month just in the insurance premiums being lower. Again, it's an option. You don't have to. You could always take the higher insurance. And me personally, I like to have lots of insurance but high deductibles because honestly, I'm only going to use an insurance in worst case scenario. I don't want to use insurance on little things because it's going to make my insurance premiums go up and people aren't going to want to insure me. It's crazy. Like the more you use insurance, the more it costs. So I'm only going to use it if like something blows up or a massive issue. We used to truck have a truck fire in it and I didn't even make an insurance claim because I didn't want to affect my entire business that over the course of the next few years I probably would pay the truck three or four times over just by the premium bump that might come up by having a claim on insurance. So I personally like high deductibles but lots of insurance just to make sure I'm covering the case that there is a 50, $60,000 mistake that is made. Cash pros, these are the good things. The fact is, a lot of times you can get a lower price on the private market using cash. Not a lot of private buyers are going to want to do financing. They don't want to go through a bank, they don't want to do a loan with you. They don't want you to take over payments. They just want cash, baby. And so sometimes you can get better prices on the private market. You take the same exact vehicle that is used and you throw it on a used car lot. You're paying an extra 20 or 30% sometimes so you can get a better deal using cash if you have it. And that is a pro as well, getting a better deal. And therefore there's less depreciation when you drive it off the lot because you've already paid a lower dollar amount in terms of the actual price of the vehicle. Some of the cons though, of paying with cash is that there is a large cash requirement. You're going to suck out all of your cash. And if you only have 50, $60,000 to get your business started, if you're buying a nice truck for 30 or $40,000, you just wiped out half or more of your cash reserves. And now what do you do? You have a nice truck and no business, no marketing, you don't have any customers, you don't have any other equipment, you don't have any employees, and there's still a lot of other expenses. So sucking a massive amount of your capital, especially when you're first getting started, that is definitely a downside of having cash, having to pay things with cash. It also inhibits your growth because by sucking all the cash of the business, it doesn't allow you to go spend that money on marketing or hiring or buying other things in the business that are going to generate more income. Like a piece of equipment that you might be able to charge customers more for. That's going to inhibit growth is just the fact that you're sucking the cash out of the bank and into a fixed asset, which is your truck cash. Who is this ideal for? It's going to be for someone who's a little more conservative with the rate or trajectory of growth that they want to have for the business. Again, who this is ideal for comes down to what do you want from the business? If this person wants to have the security and the mental security and be able to go sleep at night knowing that they don't have a bunch of debt over their head, they don't have a lease that is coming due, or if they ding the truck and then they can't convert the lease back in, they just want a little more peace of mind and they're okay with a slightly lower growth rate. They don't need to go from 200,000 this year to a million next year and then 4 million the next year after that. If you're going to do that, you're probably going to need some sort of leasing or financing because you need the kids cash in the business to be able to fund all the other expenses, not buying trucks. So definitely a more conservative rate of growth if you're paying with cash. A lower debt to income ratio. Again, someone just a little more conservative doesn't like to have a lot of debt. And that debt to income Ratio is something you want to monitor and you're just running a riskier business. If you're having a higher debt to income ratio. Also great. This is ideal for someone that doesn't have any credit history. They don't have any credit score and they can't go get a lease, they can't go to get debt. And if they did, they're going to pay absorbent financing fees or interest. And so therefore someone with no credit history, great. That's ideal if you're paying cash. Also, someone who's going to pay cash is someone who doesn't want to have a lot of risk and they're an opportunist, which means when times are good, they'll pay for things with cash. So that way when there's a recession or times get bad, they don't have any debt, they don't have any obligations, and they have a lot more freedom. And they're not bound down by a bunch of fixed expenses. Because during a recession or potentially even if your business starts to struggle or you don't get as much work, having high fixed expenses with lease payments, high premiums and deductibles, high loan payments that you're making on debt, those things are fixed expenses that don't go away despite you making less money in revenue. So having less fixed expenses, definitely someone that is ideal for paying with cash because they're going to be able to spring on opportunities when everyone else is laden down with debt and fixed expenses. Now let's talk about the person that spends a bunch of money in buying trucks using debt and loans. And I'm trying my very best to be objective between all these three because I don't really have a shoe in the game here. I'm just trying to to give my feedback of who potentially might want to use these different financing options. You do what's right for you. Because all of us are in different stages of our business in terms of size as well as the objectives and goals that we have for the company. So debt, going into debt, getting a loan on the vehicle, whether that be from the dealer or whether that be from a bank. Now here are the pros. There's actually a possibility that you can get no money down and you can actually roll all the financing costs into the cost of the vehicle and walk off the lot without spending hardly any money. That's a great pro. Literally no money down. Get a great truck, an asset you're able to go use for your business and make revenue. That's awesome. Another pro is that use Leverage. Leverage is the ability to be able to take a dollar but then get $3 worth of buying power. That's leverage. So by having a little bit of cash or a little bit of a down payment, you might be able to get 4, 5, 6 dollars worth of asset, a truck, just by spending the $1. So leverage is a great opportunity, allowing you to have much more growth. You can grow a business on debt much faster. Big businesses, lots of very big, large companies have a lot of debt and they do that in order to be able to grow very quickly. It's a great tool to be able to grow faster than if you were just to use cash. Now, some of the cons is that honestly if you buy a truck, especially if it's new and you get debt on it and you roll the financing charges into the vehicle's payment, immediately, you're probably 20 to 30% underwater on that asset, which means it's worth less like by 20 or 30% compared to what you owe on it. I never want to owe more on an asset than what I have in equity. I just don't. And so even with my real estate, a lot of my properties, I have equity of 40, 50, 60% because I hate the idea of ever it being reclaimed. If I can't make a payment or something goes bad, I'm just a little bit more risk adverse. But if you a con of having debt, especially if it's new, is immediately you are underwater on that vehicle, which means if something ever goes bad, the bank would rather come pull the truck out of your hands because you owe more on it than it is actually worth. Another thing with debt to is you're either going to have interest or you're going to have financing dollars. Okay? What that means is you're either going to spend interest of 5, 6, 7, 8% depending on what your credit is, depending on what the current interest rates are, you're either going to pay interest payments or you're going to have to pay financing charges. Because guess what, even if you get 0% down and you don't walk, you don't put any money down in that vehicle. I guarantee you 5 to 10% is being taxed on that purchase price and you're not getting any discounts, you're not going to be able to come in and start haggling on price. If you're asking for no money down and financing, you're going to be paying top dollar plus another five, $10,000 in financing charges. You're like, oh, it's zero percent down. No, it's not. You're getting financing charges wrapped up into the price of the vehicle and you're simply willing to accept a higher price. It's literally like going to someone, selling their house and like, hey, look, I don't have a lot of money, but I'll give you $30,000 more. You're asking for 100,000. I'll give you $130,000, but I don't have any money. So just give me your loan, Give me the loan you currently have and we'll make it work. It's great in theory until the market go down or there's a tough time or there's a recession. And so definitely a con is that you have interest or the fact that you're actually having a financing charge. You're paying so much more than the asking price simply to be able to walk away with a low down payment or no money down. There's also much greater risk during a recession because when the value of that vehicle goes down 20% in addition to it already depreciating a lot and you have a lot of fixed expenses. And guess what? There's something that banks don't like to do during a recession that is not like skip payments. They're going to come collect their assets. They might even liquidate or call your loan in the case where you owe more on that asset than what it is worth. So during a recession, the value of these trucks go down. We've all been used to 2020 and 2021. Truck values go up. That doesn't happen typically in a recession. They go down 30, 40, 50%. And so if you go into a recession and you have debt up to the hilt and you're drowning in it, bad news. If you have a whole bunch of debt, who this is ideal for, who should finance their vehicles with loans? Fast growing companies that need cash. Because if you're growing really fast, you need cash for opex, that's operating expenditures, or for advertising, expansion, growth, acquisitions, hiring. There's a lot of money that is required to grow a business. And I've always said growth sucks cash. So the last place I want to put my cash if I'm growing really quickly is in hunks of metal and tires. So I should finance those using debt so I can grow much faster and then take my cash and deploy it against advertising. Getting more customers, getting a bigger shop, getting an office person, hiring more employees. So that's the route if you want to go very, very quickly and move very fast and grow your company extremely Quickly. That's not for everyone. I've seen plenty of people implode and explode during a recession. And the companies that typically fail during a recession and when times get tough are the ones that have a whole bunch of debt or they've leased a bunch of vehicles. This is the much more conservative route, but it's also the slowest route to get there. You're not going to grow 100%, 200%, 300% year over year and a million and five million and 20 million. You're not going to do that with cash simply because you will not have the cash to be able to buy all of your assets without using debt.

So I hope that was super helpful for you growing your business past a million dollars in annual revenue. I highly recommend you go check out copilot CRM.com that's the CRM that I've created this past year to be able to have all the key performance indicators in your business. And it's extremely important if you're wanting to scale and grow your business that you understand and know and have access to things like your attrition rate, how long it takes you to get estimates sent out, how long it takes you to get invoices paid. These are key metrics that we have in what we call a cockpit inside of copilotcm.com that gives you all the information you need to run your business successfully. And we're using AI to actually tell you what you should be doing in your business, like which customers you should raise prices on, which customers you should cut because they're too far away from your shop. And also looking at, okay, what's your budget, hour capacity, how booked up are you and when should you be hiring someone? That's all something that we solved using software and using AI. So you definitely want to check out copilotcrm.com because we also have what we call office hours. Every other Saturday. I am going to actually do a live stream with all of our members inside the private Facebook group. And it's a great community to be a part of. Definitely go check it out. Go to copilotcrm.com There's a free demo on there and you can see if that software would help you because I truly believe one of the best things you can do for your business if you want to grow and scale is have efficiencies in place like software, so you can take credit cards on file, you can charge ach and banks instead of trying to like wait for cash or put the check underneath their mat and then it blows away. Definitely want to get professional. So go check out copilotcm.com and until then, watch this video here if you're just getting started because you might have watched this one too premature. This one's going to help you get to from zero to a million. This one was helping you grow beyond that, but this one will help you get to $1 million in annual revenue.

This has been the Mike Candies podcast. Now you have some ideas on how to take your business to the next level. And if you liked what you heard, we have tons of lectures, interviews, and more over at the Mike Andy's YouTube channel that'll be right up your alley. That's all we have for you today. We'll see you next time.

Sa.