These Last 4 Months are Make or Break (The Most Profitable Time of the Year)

Welcome back to the Mike Andes Podcast, where we discuss the ins and out of owning a small business. If you're new here, the Mike Andes Podcast is all about taking your business to the next level. We're back at it with another call in show with Mike. This one is specifically focused on how you can take advantage of the last four months of the year that could potentially end up being your most profitable if you're ready for it. If you have any burning questions for Mike, you can sign up for the Mike Andes Text Club, which will notify you whenever Mike goes live. Just Text Landscaping to 360-227-6362. And as always, you can find all this and more over at the Mike Andy's YouTube channel. All right, how can we make sure you're ready to take on the fall rush?

Ladies and gentlemen, boys and girls, it's time.

Happy Labor Day. We're doing a live show today. We haven't done one of these call in shows for quite some time, probably four or five weeks. If you would like to answer, ask a question. Just call the number below 361733, 3332 and we'll take your call. I want to make this episode specifically for the fact that it is now September. September, October, November and December. The four months, the last four months of the year. We are still less than 70% of the way through the year, which means right now, if you quit and you check out, you will get a C minus on the year 2022. The last four months of the year are the most profitable for the home improvement industry. I don't care if you're in lawn care, landscaping, cleaning in history. Historically, the last four months of the year are when you make all of the profits for your business. So do not check out right now. This is not the time to coast until the end of the year. You know, summer's over, kids are back in school. It's very easy to fall back into the. Let's just take it easy. Let's coast to the end of the year. Let's put things on cruise control. This is the time if you're going to take advantage of 2022 and make profit. The next four months is when you accelerate into the end of the year. So I highly recommend you really start to look at whether your goals are for 2023. Like that whole next year I don't even think about. Just got through summer, I made it through spring rush and now I'm just trying to get and settle down. Yes, you can Settle down. You can coast until the end of the year and you can have an average remainder of the rest of the year. However, if you're going to have an extraordinary 2023, it's going to come down to how you, how you execute in the next four months. Right now, you have a solid team. You're not trying to build a new team like you were in Spring Rush. You don't have a whole bunch of brand new customers like you did in the Spring Rush. You, the weather is decent, things are really looking good, and you're able to make a really good profitable route. You're able to accurately predict jobs. You have a good crew on staff. Why in the world would you be thinking about coasting right now or laying one or two people off? This is the time to accelerate. When all of your competition is not hiring, when all of your competition is not advertising, this is the time to go all in on your business. All right. So that's why I'm making this video today, if you are. If you have a question, I would love to answer that. If you call the number below 361-733-3333. Going to be taking your calls live today. Got a question here from Kevin. What should a 500 call K revenue working GM focus on the most? I think right now the big thing is making sure that your general manager, again, Kevin's talking about Gus. We talk, we talk about one of the stages of growth that we have is a working gm. That is when you as the owner are no longer the field, but you have a working gm, a general manager that's still in the field working three to four days a week. What you should be focused on as an owner is is that manager ready to roll? Are they trained up? Do they have all the estimate experience? Do they have everything that they need to be able to be out of the field and in the field operate effectively. What that means is potentially getting them a Chromebook for their trucks. That way they can manage the crews while they're out in the field. A cheap one, it's like very hearty. Doesn't have a glass screen, all plastic. The thing can be dropped and ran over by a truck and it'd just be fine making sure that they are going to be efficient doing those estimates while they're out in the field as well as managing the crew while they're still out in the field. Would you discourage raising prices this time of year if jobs are profitable but at some point in the near future you need to raise them. Really comes down to whether or not you've grown to capacity. This we talk a lot about, and that is have you grown to the point where you need more trucks and equipment? If you've grown to the point and you're continuing to grow and you still need, you need another truck or you need to hire more people, probably a good time right now to raise your prices. However, if this is the kind of you're going your fall season, you get a bit of a rush of customers right now and you don't, you know, don't use your truck for three days out of the week or a bunch of your equipment just stays sitting around there doing nothing because you don't need it. This is a good time to grow into capacity. Go to the point where you don't need the, where you are, your asset utilization is much higher and your all of your crews are out being mobilized every single day. That would be my number one recommendation. Again, this happens every single time. If you want to take a call, 361-733-3333. It always happens with the eight end of this. I have to turn everyone off that's in the waiting room. So if you have a question, please call in. It's much more exciting than me just reading the questions.

Just getting started on my own. Snow is going to get crazy here about November, going from about 15 to 25 houses for snow crazy is just starting. Good morning, Cody. Should I use door hangers for bush trimming and fall cleanup separately, or should I put them together maybe in a flyer instead?

For example, on lawncaremedia.com, we have fall cleanups. And part of fall cleanups is bush trimming. The reason is because if you're doing a fall cleanup, you can get them for bush trimming, leaf cleanup, and, you know, bed maintenance, for example. And so you can kind of bundle those services up. We have the property cleanup instant quote where actually when you're doing door hangers, you actually can check off what services you're giving the quote for and then put a price. So I highly recommend the instant quote door hangers on lawn. CareMedia.com first caller is coming from Marysville, California, area code 530. Let's make sure this thing is working today. Can you hear me okay?

Yeah. How's it going?

Good, good. I think everyone else can hear you. Just let me make sure that I have everything rolling because last time I was on here, no one could hear you. Okay. I think you're good. Go for it.

So my name is Carter. I'm from an hour north of Sacramento, getting things set up. I want to be able to really grow this spring.

When you guys talk about systems, what exactly does that mean? Like, can you give an example of a system and how it would, how it would work that way? I can get things set up. I think I have the idea of it, but I'm not exactly sure what, what exactly it is.

So what's your interpretation of a system right now? And then I'll give you my answer.

Basically.

You know, like a, a paper.

Like a piece of paper that has a breakdown of. This is how you do this.

So like it could say, you know, when you pull up to the property, this is what you look for. This is how you weedy, this is how you mow. This is the order you do it. Is that basically what you're talking about or is it.

Yeah, a lot of. Yeah, totally. A lot of times people, A lot of times people think that you got to write things down. And, and definitely most systems you can write down. Here's the thing. Starting your car is a system. Here's the system. For some cars, push a button. For other cars it is turn a key. For other, it is put the key inside of a certain slot. For others, it is push the button onto the remote. Every single car has a system for starting it. Whether or not you write it down is inconsequential. I think everyone has monetized the creation of systems inside of the business ecosystem because they know you, they can sell you something that's written down and then call it. You are systematizing your business. All there needs to be is a system is simply something in my mind that, that is done every single time and has the same result every single time. If you push this button, your car starts. If you push this button, your car unlocks. Like there is a very clear start and the end result of doing that action. And so when you create an estimate, for example, there needs to be a very clear defined way of creating the estimate. I put my notes here. I then go into copy and paste it into this. This is the format I'm going to use every single time. And this is the delivery mechanism, whether it be email or SMS or whatever it might be. And it followed as it's done the same way every single time. And when you, you get out of the systems is when you start to create variation. Oh, well now today I'm not going to push the button to start the ignition. I'm going to crawl underneath and try to do it manually underneath the car and push the button and when Jerry rigged the wiring, that is when you start getting out of the system and creating issues. And so I really believe a system is simply something that's followed every single time. Has predictable inputs and outputs. What are the inputs, the estimate notes, the time in which you're going to do them, where you're going to put them inside the software, the outputs, what the formatting looks like, what the pricing looks like to the customer. And we're just talking right now about the system of creating an estimate. There's one for creating an invoicing. Your pricing, your, your billing, the way that you collect card information. All these systems are simply predictable inputs with predictable outputs that happen every single time the same way. Does that make sense?

Yeah.

So that's way simpler than I thought because I think I was over complicating it a lot.

Yeah. And totally. And in this industry, most people complicate because they can sell you something. It's like, I'm going to give you the 58 step process for doing a sale for your lawn care business. I'm going to sell it to you for $100. It's like, look, I really don't care how you do your estimate. It's that you follow the same pattern every single time. Because having a good system, you can only create, you can only improve your system if you have a system. And then you slowly, incrementally start manipulating it. Right. Like the timing where you put the estimate notes what your pricing is, your pricing matrix. You can only tweak it and make it better if you follow it the same way every single time. And what happens is, some people like, well, sometimes I take the estimate in person. Sometimes I will write it down on a piece of paper in my truck. Sometimes I'll do it verbally and then I'll put in, after they've accepted the quote, I'll put into the CRM. Sometimes I don't put it in the CRM. I just put the job on the schedule. That's when you're out of the systems and that's when you do not have a system. But having a system is simply a predictable way of doing the exact same thing every single time. And only once you create the system can you actually start to tweak it and make it better. You cannot improve something that is every single time different. And every single time you do an estimate, every single time you do an invoice, every single time you do a job, it looks different inside of your CRM. Every single time your crew looks at the job, it looks different. The job notes look different. They're formatted differently every single time. Cannot improve on something that is consistently changing every single time you use it inside your business.

Okay, awesome.

So one more question if you got time.

I've been, I have looked into doing you guys franchise. I've had a couple meetings with Lee.

What would you say is the biggest advantage to the franchise? Overdoing it My own.

It really comes down to what you just brought up. Right. Like we are. When you come to training, we're going to tell you, here are the systems. You know, we've tried this a thousand times. Here's what we recommend you do every single time. And you're going to immediately have the system to follow. That's the advantage of joining any franchise is the fact that you hope they've done it hundreds, if not thousands of times. And they're going to tell you do it this way and you should do it that way until. Until you find a better way to do it. But you're going to have that initial system down so that way you don't have to do it a thousand times and create it and tweak it and make adjustments to it. It should already be refined to the point where it's going to be successful and you avoid the hopefully year two, three years of fiddling around with the system and perfecting it.

Okay, sounds good.

Cool. All right, brother. You have a good one. Hopefully I'll see you soon. Take care.

All right. Next caller is from. I think it's locust, North Carolina area code is 704. Welcome to the show. Thanks for coming on.

Hey, Mike, how's it going? This is Phil.

Good, good. What's up?

I just had a question.

I'm about eight months in and I know like my goal is to be.

As professional as possible.

I just was wondering, is there a certain time I'm supposed to get insurance or like a number of customers I should have?

I know I need it, but I.

Just kind of give the pros and.

Cons of when I should get it.

Yeah, get insurance as quickly as you possibly can. It's relatively cheap. When you're first getting started, it's probably less than $50 a month. And so the liability of 600, $700 a month to get your liability insurance at your size is, is worth it. That's one property cleanup. That's one day's worth of work. Just so you know that you have the, you know, the security and the liability protections that if you send a rock into a Little kid's, you know, eyeball when they're walking by your lawn care job. And trust me, it happens that you're not going to get your business completely, you know, put over the coals because of that.

Okay.

Yeah, I was.

I looked at next and I was.

Doing all the numbers, and I thought.

It would be a good idea, but I wanted, you know, for personal, professional opinion.

Yeah. Most general liability company, most general liability policies for if you're just getting started is literally 50 to 60 bucks a month. If you're buyers yourself just doing lawn care, if you start doing landscaping projects, if you start doing trimming trees above, you know, the gutter height, things like that, you can start adding to that. But 50, 60 bucks, if you're just doing lawn care. And I definitely recommend it from day one.

Great. Thank you.

I appreciate the time, your play.

My pleasure. Have a great day, Philip. All right, next question is coming from area code 559. I think it's from California. Go ahead.

Hey, Mike, how you doing?

Good. How you doing?

Good.

Good. So my question came from today being Labor Day, and I pretty much kind of.

I'm thinking about how we would go.

About, like, getting some of our holidays out because, like, for like, my business, I charge a lot of accounts per.

Month, like, not per mo.

So, like, do you think it'd be like, do you think it's acceptable to, like, kind of take the day off for, like, the major holidays when it falls on a weekday and still charge the client?

Yeah, I would just shift it forward. Right. So you could just say, okay, if on day on a week where there's a holiday, you're gonna take that day off and then you're just gonna make sure that there's enough hours. Like, you just don't. You do less projects in that week. So that way you're able to move everything off 24 hours, move it off one day in terms of the work that is recurring. Right. So if you got all your mo's and today's Monday and usually mow them on Monday, just do them tomorrow. But in shifting everyone one day, you're gonna have to make sure that there is less budget hours on the schedule for projects. Right. So, you know, let's say you have 50 lawns and typically do 50 lawns and two projects on, you know, this week, you might skip the two projects and just do the 50 lawns, but everything gets moved off one day. And typically, you know, we don't even tell customers if we're going to do that because they just get it when we sell a mowing job. And I'd recommend you do for your. For your recurring schedule when you give someone a day that you come tell them a specific day, but plus or negative one day. And that gives you some leeway when it comes to holidays. So you can take the day off and then they're still on their schedule based upon plus or negative one day for scheduling and. And weather purposes.

Got you.

All right, perfect.

Cool. All right, brother, have a good one.

Thank you.

All right, next caller is coming from Eric. Code five. Five one vantage landscape, I believe. Welcome to the show.

Hey, what's up, Mike?

How you doing?

Good, good. What can I do for you?

All right, so I just want to give you a little backstory before my question.

Real quick.

So it's me and another guy were making for the past few years 150 to 175. And I feel that I'm at capacity.

Right.

Like I need another truck. I need another, like another guy that can get in that truck or whatever, you know, to move forward. So I'm having trouble actually getting the capital and like being able to grow this thing. The problem is not leads. It's just capital because I believe the issue is me having too many personal expenses. But I don't know how I can cut that out or I really just don't know what else to do right now without capital.

Well, if you're.

Do you have any recommendation, Are you.

Using the two trucks basically every single day then.

I only have one truck. It's me and another guy.

And.

And that's it.

Yeah. We use.

Asset utilization is to the max.

Yeah.

So. So why don't you go ahead and raise your prices if leads is not the issue. Why, why not go ahead and raise your prices so you increase your margins and can stack money for the next four months?

Okay. Yeah, that's a. I just raised my prices in the beginning of the season. We're at $70aman hour. And for my area in New Jersey, I think that's pretty top notch. So I don't know. I'm at a 50 close ratio or 56.

So I don't know if that's gonna fly.

Yeah, well, the thing is 56%, you know, I already know it's going to just depend on how much you raise it.

Right.

Like I think if you went from 70 to 85, you'd probably drop down to about 40% close ratio. Which again, if you. If really what you said is true and that is that you're not having any Issue with leads. That's the thing to do if you're going to try to stack cash away, right. If you do that for the next four months and you only have 40, 45% close ratio, but now you're going to have an extra several thousand dollars going in next spring rush to deploy against the truck. And you know, if you needed to get a loan to get another truck, I would do that. But if you're so skinny right now in terms of financially to where getting another truck is that damaging, I would say you need to raise your prices anyways. And in New J. $70 an hour. I know it sounds like you might be, but you need to raise your prices. If you, if you are at the point where you have max capacity on one truck and you can't afford a second truck and you're making 17 to 180 a year on one truck, you need to raise your prices. And part of that is because you have, you have two owners. So you have two different, you know, two families, two, two different people that you're trying to, you know, suffice inside of the company. That's expensive. Right. So part of, part of your issue right now is the fact that you have two owners. If you had just an employee right now, you'd probably be making quite of cash and profit. But because you're splitting your profits in half with another owner, that's making the business pretty skinny. And when you have two owners, you kind of need to scale simply for the fact that you just have, you're splitting the profits. And so I would recommend, I would recommend.

I'm so sorry to cut you off it.

I don't.

Maybe I am mumbled or whatever, but I, I don't have another owner. It's just me and another employee.

Oh, good, good, good, good. Okay, so you're saying 1, 170. 1.80 of one employee. What do you pay him per hour?

17.

Now I follow the 25% that you say.

Perfect. Yeah. So, you know, why do you think, Let me just ask. That's quite. Why do you think you're, you don't have enough profit right now? Because at 180, if he works full time, you're looking at less than 35, 40,000 a year. That's 130. 140. You're gonna have a low, really low overhead. Like you should theoretically be pulling like 80 to 90 grand a year.

Yeah, I know, but that, that's the thing. I, I think I pull out too much cash.

I don't Mean to pull out. Pulling out cash is fine. I mean like when you look at your own personal tax return, you should be making 80 to 90, 000 adjusted gross income. Like where, what's. Is there other expenses like loans or debts that you have?

Yeah, I mean the truck I'm paying. And then I do have an office manager though.

That'll kill you. You know, that's what it is.

Yeah, I know, I know.

Because you're too small to have a proper. You're too small to have an office manager. You're literally taking like when I say about the, the other owner, literally, that money that would typically go into the owner is now literally going. An office manager and that person, full time, part time, what's their schedule?

Yeah, so they make 720 a week. You know.

That'S it. I mean 40 hours.

Yeah. That's half your profit right there. Right? So.

Yeah.

Right. What I would recommend doing is trying to figure out systems to where at your size, you cannot afford a full time office manager. You need it. You need to get above 350, 400 before you start thinking about a full time office manager. It's just too much overhead. What I would recommend doing is trying to systematize things like putting clients into your profile, you know, in the profile, getting the notes correct and try to take on that yourself. And if that means you out in the field with a computer, like a laptop, putting in the job notes, wherever, that's fine. But you've got to absorb that 720 needs to go into your pocket right now. Because if you do that for two months, you'll have enough to buy another truck.

Right? Yeah. That's a good, that's a good answer, man. I appreciate it.

You're my pleasure, brother. You have a good one. Take care.

You too.

Yeah, like we talk about going the offensive in the next four months. The other side of the equation, every dollar you can save right now is a dollar you can deploy against next spring rush and just make so much more damage in the business. All right, next question is two one, five. Thank you everyone. The call queue. I'll just try to keep pounding through these. 21 5. You're on the show. Welcome.

Hey, Mike, this is Gerhardt from Sustainable Land Solutions. How are you?

Good, good. How you doing? What's up?

Very well. Okay, so I am all electric. I have a big focus on natives and everything. So second year in electric is expensive. It's a little bit. Takes a little bit longer to sell. Next year I'm looking to hire My first full timer pretty much to do the recurring work, the mowing. Here's my biggest thing. I'm going to be 31 on Thursday and I'm starting to get burnt out from being in this industry for a while.

And going into next year I'm looking for someone to take care of the recurring. Well, I mainly start to focus on the installs, the bigger ticket things. So I'm not always in the field, but I do have my, my focus is to build a business.

So how many, how many employees do you have right now? I missed that part, I apologize.

It's.

It's just me. I'm solo. I, I get people for, you know, bigger jobs, like one off things, but I am getting burnt out and the, the thing is, you know, electric is a little bit higher of a cost barrier. I get that. But doing everything is, is a lot on me and I'm looking to hire someone to do the recurring so that there's always money to pay them. And then pretty much next year focus on the one off, bigger ticket. So I'm not always in the field and can handle all of my expenses. Do you think that that would set kind of low morale if I have someone working more than me.

You know, being the owner?

I think there's a false assumption here. Give me a second. So.

Why do you think that it will be less work if you're doing big projects versus out in the field mowing?

So if I do, you know, three installs in a week, that would be three days as opposed to someone else in the field working full time, you know, five days a week or 40 hours. However, that, you know, plays out throughout the week. Whereas I'm working, you know, 24 or so, but on the other end I'm doing all the office, all the estimates, all the, you know, all the admin work.

Yeah. So I think, I think this really comes down to something I talk about a lot and that is what type of stress do you want? Right. Right now you've been in physical stress for a very long time because you're in that 0 to 200,000 annual revenue level. Right. And so you have a lot of physical stress, you're out in the field working a lot. And so what everyone does in the stage, just be careful of this. I'm not saying this is the right or wrong answer. I'm just saying that I see this all the time. People are like, oh, I'm physically stressed, I need to grow so that way I can get out of physical stress so they get past 200,000 annual revenue. They get a couple employees, they get to 253, 400,000 annual revenue. And what they start to realize is the physical stress becomes financial stress because I'm not making a single dollar more at 400,000 in annual revenue than they were 150 and 160,000 annual revenue when they're working by themselves. So the physical stress just becomes financial stress. And those three days that you're working out in the field become six and seven days because you're trying to make up for the massive amount more overhead you have in having more employees. And so I would just be very deliberate about the fact of do you actually want that stress? It's not. Stress is not going to get less. You're not going to get burnt out less by growing your business. Guarantee you that. It's simply going to transfer the type of stress from being physical stress, which is on your body versus your pocketbook. And the only way that you can somewhat alleviate that is before you do that, raise your prices significantly so that there's less financial pressure. But there's going to be more pressure and stress, just not in the future. Physical side, if you're going to go down that route.

That'S, that's, you know, that feels comfortable with me. I'm already at 75 per man hour and looking to raise, you know, like you, like you're saying all the way, 100, 125. You know, if it's an install, you know, that's highly skilled work as opposed to, you know, mowing. But I'm, I'm right now feeling both because like I said, the electric is, is. It is a higher cost of entry. So there is, you know, I'm, like I said, I'm in my second year and I'm still solo operator. So, you know, it's a little bit. Take a little bit more financial to build, and I'm fine with that stress. But having both the physical and the financial is, is breaking my body down, I feel like. So I would recommend I would be fine.

Try to get one employee with you in the truck, right? So right now, let's say you have 50 hours worth of work out in the field. Try to get an employee. So that brings it down to like 35. You can put a little bit more schedule on the schedule because 35 plus 35 is now 70. So you're gonna get another 20 budget hours worth of work on the schedule and they're gonna be with you in the truck. That's gonna be done very efficiently. And profitably because you don't need to go buy another truck, buy more equipment. I highly would recommend do not diversify into other services like landscaping in order to try to get away from the harder work. That is a fallacy. That's going to be somehow easier doing three days worth of projects because this is what happens. Those three projects that you have on the schedule, you have a bad day, pop tire pops, bad weather wear. And now that one day project becomes a three day project and you're butting up against the next project. You're going to get behind the material, don't get delivered correctly, all this stuff happens. Right. So don't think that adding in projects is going to somehow solve this issue. I would recommend if you're working a ton of hours, get an employee inside the truck, increase your capacity by say from 50 budget hours a week to 70. Get an employee with you inside of the truck now to be able to help with that. And it's going to be very profitable because you don't need another truck, you don't need more equipment, you don't have to diversify services and add more pro liability and more equipment. You don't have to do any of that. I would just focus right now. And the switching services has nothing to do with capacity, has nothing to do with pricing, has nothing to do with the finances. I would stick with what you're doing. Add more, but put an employee inside your truck so you can make more profit per day, but work less. But adding more services right now is the wrong move. You're going to get that. That is like the recipe for more stress.

I, I do keep it very simple. You know, mowing maintenance, garden maintenance, garden installs and then snow, you know, that's.

A whole other season.

But that I do keep it very simple. And even the, the garden installs are very, very simple. They're just typically native pollinator gardens.

Yeah. So I would just keep the employee.

With you more than one day.

You would throw a couple projects on by adding an employee, you'll get the mowing done maybe in three days. Now you have a couple days to get a couple projects done and that can be money in your pocket. Right. But I definitely wouldn't try splitting the two of you up. Like, hey, they're gonna go do the mowing, I'm gonna another truck and go do projects. I think that's, that's gonna really compress your margins by getting a second vehicle. You know, you're gonna double your liability insurance, you're gonna double your auto Insurance, you're gonna have now more storage space required. Like, all of that's gonna add more cost the business. I'd just throw an employee in with you, get your mowing done in half the amount of time, and then throw a couple projects on the schedule.

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All right, so that leads me to my next question. Where's the best dollar spent in in advertising to get marketing, to get more.

Hours on the schedule?

I'm doing Facebook and Instagram, and I'm.

Not seeing much results upselling your existing customers. It sounds like you have quite a few customers. I'd be looking at every single one of their properties there and trying to upsell them on something. And I'd also be emailing all of them once a month with a service that you're trying to pitch. If you do that alone, you'll get enough just to fill your schedule.

All right, thank you for your time.

I really appreciate it.

You got brother. Take care. Next caller is coming from 7:3:2. It says, Brendan 732, you're on. Thanks for coming in.

And I'm not really in your business.

I'm more of a starting.

Entrepreneur, I would say. My question to you is, when you started Augusta, who did you start with?

Say it. Say it again. Maybe I don't know if you're on a Bluetooth, but maybe just be. If you can talk a little clearer into the mic, it's a little bit hard to hear you.

This better?

That's much better. Thank you.

Sorry.

So when you started Augusta, who were you with? Like, how did you. I know you were talking about how.

You mow the lawns when you were younger and.

But, like, when you started the business, like, who were you? Who were your, like, team?

What do you mean, my team? Like, it was just me at the time when I first got started. You mean, like, my mentor? Stuff like that?

No, no, no.

I was just more so.

I'm really hesitant on starting because I.

Just am terrified of being alone, I guess.

And my really question is, like, how.

Would you find your team members, like people that you rely on now, you know, like, where did you find them?

Or like any advice on that? Yeah. Like when you first get started, you don't need a team. I understand the sense of loneliness in having to do it all by yourself. But honestly, like if you just scale back a company, even the size of Augusta, all the way back to a very small. I'd just have to wear more hats and do more things. But it's such a. So small. You can do it all yourself. Right. And so you might not be the best at all of those things. But I understand the loneliness side. I understand going especially if you have. If you've been an employee and you have 10, 15, 20 coworkers and you have more of a community and you're used to doing like one task all day long. I understand that sense of loneliness or being alone. But you do not need a team. When you're first getting started.

That is usually a recipe for spending way too much money up front to try to create some sort of a culture or like multiple team members. Members when the business can't sustain that financially. So don't feel like you need someone or need a team up front. It's not going to be possible. I didn't have an employee for the first year, year and a half. I didn't have an office manager for the first three or four years and I was in the field for the first four or five years. So don't feel like you need that from day one. Especially if you don't have the capital to burn through while you prematurely hire a team and get a whole bunch of infrastructure built out. What business are you starting?

That's a complicated.

Question because I haven't decided yet. But something more like something to complement the Be real.

Discussing mental health.

It's nothing near perfect.

Or refinery.

Yeah, yeah. So I think a lot of times when people are unclear on what they're going to do in business, they think, okay, I'll work it backwards. That is, I'll build the team and then whatever we're going to do is going to come and like the team will kind of determine that. Works really well in venture capital and tech world, right? Where they're like, just get a great founding team together and like it, you know, bet on the. The jockey, not so much the horse. When it comes to small business and bootstrapping and home improvement and small numbers, small amounts of capital, you just need to get started. You just need to start and it might take you two years to try 10 different things and you'll come upon something. Now if it's mental health that you're trying to work on, that is the number one thing you can do right now is start creating content around what you believe in when it comes to mental health and creating awareness around it. Because the media, you'll attract an audience and the audience will determine what they're willing to pay for if you want to create a business out of it, or they'll tell you what they're interested in if you want to create more awareness around something. So you just need to get started. Do not worry about the team. The team own the team thing only works in a world where there's venture capital and there's money to throw into this. Like let's create this great team and have like 8 different org chart and like all the different positions and titles and all the rest of it and then we'll figure out what we're going to do. Like that is, that's like old news. That is what has been portrayed on movies and Entrepreneur magazine and Fast Company. It's just a bunch of garbage when it comes to actually building a real business.

So you're kind of saying that like.

Appeal to people and the people you.

Find through your media campaigns will kind of decide the product.

Exactly. You know, start creating, start just creating content around mental health. And maybe as a product, like whether it be online courses or consulting or whatever you feel like you're inclined to do in terms of monetization, but don't feel like you need to figure it all. You need to hire a team and get people together before figuring out what you want to do. Because I promise you, regardless whether you have a team or you're by yourself, it's going to change 10 times. And so just focus on doing. And whether that be creating the products or would that be creating the content and creating a community, the products will come later on. Don't worry about that stuff. Just get started. Whether it be on the content side or the product side and then start iterating. The only thing you need to focus on right now when you're small in your business is iterations. How many times can you do something and mess up on it so that we can figure out what works and what doesn't? Don't be paralyzed by the fact that you're by yourself or you're alone or there's not other people in the team. Just get started.

Okay, thank you so much.

You got brother. Take care. Next caller is coming from three three zeros area code welcome to the show. Thanks for coming on.

Hey, Mike, how's it going?

Good, good. What's up?

Hey, I'm.

So I started my lawn care company when I was 20 years old. That was two years ago. I'm 22 now. I started off with 15, 20 clients, I'd say.

And.

Now this year I'm up to 50. I'm by myself. I did have quite a few employees, but I quickly realized I didn't need them at all.

I didn't know if I could handle the 50 this year, but I'm pretty sure if I got about 65, 70, I could do them all by myself this year. But now I'm. I'm kind of thinking I could get about 200 next year. 200 plus, if I do hire one or two people in the truck, come weed, whack with me.

Get.

Maybe get a secondary mower, a bigger trailer. Do you think that's feasible to do?

Then? All of it sounded good until I heard bigger trailer and bigger track.

I think, I think the first step would be, it sound like you were burned a little bit by employees. And I understand that when you're stressed, when you're that small, maybe you got them prematurely. I think what I would recommend is get one employee inside your truck that will get you from 50 to at least 80 or 90 that you can handle with just the one truck. Right. If you do that, you'll be ultra efficient and profitable. And since you'll be having eyes on them all day long because you're working with them, it'll be a whole lot less stress in terms of management. And then see how you do it that level before you start going to a second truck, more equipment, another couple employees. Like, that's a whole nother level. And you'll need to get that if you're going to get to 200. But don't think I need to go from 50 to 200. Think let's go from 50 to 90 and then test the waters out there with one employee that's working with you all day long.

Okay, I see. Now I do have. I do have one more question. I'm doing like gutter cleaning and leaf removal this year, and I don't have like a big truck with like a leaf back on it. So I was wondering, because I did some last year, a couple pretty big houses and stuff. I don't know if I should like chop the leaves up with my mower and bag them or should I throw everything onto a tarp and then take it to my dump site. Or like, what do you think I.

Should do about that?

What time of year do you start doing fall cleanups?

Right about now? Start now until the end of October.

When?

Maybe November.

When do you stop mowing lawns?

Probably within the end of this month.

Okay. So the thing to balance out here, and the reason I asked that is because a lot of times people are thinking like, oh, I need to do. I need a big leaf back. And you really focus on fall cleanups and their mowing season is through. That whole time, they're already busy enough. It's like, why would you focus so much on buying more equipment things when you're already busy as it is without that extra service? So it sounds, though, like, you know, if you're. Go ahead.

Well, they're all. Most of my clients, about 80% of them are already turning bi weekly, tri weekly to monthly as of right now.

Got it. So they're already slowing down. And so you. Okay, got it. So you are slowing down. So the thing is, how many. How many out of the 50 customers that you do have, how many fall cleanups are, like, 20 of them? You think that you're doing fall cleanups for.

Yeah, about that. And then I do have, like, Facebook and Instagram marketing and stuff that I'll get a lot more. And then I put lawn signs out, business cards everywhere.

Yeah. What I'm most scared about, honestly, is when someone gets a leaf back and they use it for one or two months, and it just sits there for the other 10 months. That. That hurts, right? Like, yeah, because the only reason that you'd buy a leaf back is if you're gonna actually make enough money to cover the cost of it because of its efficiency. And the only reason I would buy a leaf act is if you are so crazy busy and you're turning work away because you can't get to it all, then you'd go buy a leaf back, and I'd start with one. You know, you get a good one, you know, four, five, six grand, whatever you're gonna spend for it. But it's gonna allow you to get an extra three fall cleanups done a week. Well, that's three times 400. That's $1200 a week. That's $4800 a month. You that for two or three months. 10, $12,000. You just paid the thing off in the first few months. That makes a lot of sense to me. But you got to remember that a piece of equipment like a leaf back is sitting for eight, nine, ten months out of the Year, it better be pumping a lot of profit. So if you are at capacity is the only way you should be getting a leaf back. If you can get an employee that's really cheap and work alongside of you and get an extra four or five leaf cleanups done in a week, I would stick with that first because it's a variable cost and you don't have to go fork out 5, 6, 7 grand for this leaf. You're going to pay a little bit of money, get to the next few months and generate all that same profit. So I'd rather go with a variable expense at first. Unless you are at capacity. And you know by getting that leaf back is the only way for you to increase that capacity. Because I'm mostly concerned about December, January and the next eight months after that when you're not using the leaf back and it's sitting there doing absolutely nothing. And now you're going next spring rush when you should be spending money on marketing and growing that on mowing, but you don't have the capital because you spend it all on a leaf act that you, you didn't use hardly.

H.

Okay. Yeah. Because I mean, just bagging them up right now, that's not too terribly hard.

Yeah. You know, like if, if you, I would say get, get an employee even just help you out a few days a week with leaf cleanups and if you can fill your schedule and their schedule with leaf cleanups and you're still like turning work away and there's the phones just ringing off the hook, that's probably a good time to go get a leaf back. But I see too many people getting plows and leaf vacs and core aerator stand.

Too far in advance. That, and they're being used for maybe three hours a week for two months of the year. And they're, they've, they have a two year old leaf vac that's been used for 20 hours and that's all it's been used. That, that's insanity. So just make sure you're at capacity, whether that be with or without an employee, prior to jumping in too soon on a leaf back.

Okay, so with getting an employee, you do think I should wait till about 80, 95 clients?

No, you're gonna need one right away because at 50 you're already at capacity almost for one person. You're gonna need that one person, but that one person will allow you to get to 80, 90 customers.

Oh, I see.

Yep.

Okay.

Okay. Well, thank you for your time, Mike.

You got brother. Take care. Next caller is Coming from area code 815. Welcome to the show. Thanks for coming on.

815. Sorry, you've been waiting for 23 minutes. I apologize. Says it's from DeKalb, Illinois, area code 815217. Oh, we're gonna lose the call. I'm sorry.

How you doing?

There it is. Let's go. Sorry, were you on mute?

No. Yeah.

I'm sorry.

So I have a question. So I'm just. I'm pretty young. I'm just starting my business out and stuff.

Stuff.

So I'm just trying to figure out.

Like, with all the electric stuff and.

People are, like, starting to convert to electric.

I already bought my, like.

Yes, your return stuff.

So I was just wondering when I.

If I should keep doing the business or like, what.

What I should be doing.

Just keep doing what you're doing. Don't worry about electric versus gas. It's inconsequential. You could change tomorrow. This is. This is another decision that's been thrown in the mix for everyone that's getting started or is new in their business and that's trying to do gas or electric. It's like. Like flip a coin. Get started. Let's go. It does not matter. A business is not determined by the tools that you use. It is determined by the customers you have. Focus on the customers. Whether or not the tools you use are electric or gas is inconsequential to the valuation of your company and whether or not it generates profit. You could go in a different 100 different directions as to what type of equipment you should use based upon your climate, based upon how much you bag all the rest of it. You could go into that debate. But honestly, just get started. You've get enough customers. If you got a hundred. If you got a few hundred customers, you could just go out Ford tomorrow and go buy a different Elmo. Or if you really thought it was that big of a deal. But it is not what makes a business. The type of tools you use do not make a great business. It is what you create with those tools. And it is the customers that you have. If you were to go sell your business tomorrow, they do not care if you're electric or gas. They care. How many customers do you have? What are your revenues? What are your profit margins? What's your overhead? What percentage of your customers are turning every year, churning every year, your attrition rate. These are the type of things that you got to focus on, not what type of tools you use. So just stick with what you got. Stick with the Customers stick with the, the gas mowers that you got and keep getting more customers. Do not worry about the type of tool that is a massive marketing play and is another way for this industry to lose money, in my opinion.

All right, and I have one more question. So for I have about 15 weekly customers right now.

I'm only 15, but I have about.

15 weekly customers, and I want to.

Bump it up to about 30 by next year out.

Like, I know other companies start advertising.

Early in the beginning of the years.

Should I, like, start doing it before the next year so I can try and get people before they start signing.

Up for other companies?

Yes.

And then what marketing strategy should I be doing?

So list all your different marketing strategies, right? And then list them from the most expensive to the cheapest ones. Cheapest ones are gonna be things like you just posting on your own Facebook page, you asking for people's online reviews, you post up flyers, you doing door hangers, you knock on people's doors. Then it goes, okay, Facebook ads, Google Ads, these are more expensive things. Creating a website, all these things are much more expensive. What you want to do is keep doing the free things as much as possible all the time. Then what's going to happen? You're start randomly getting all these calls as we head into spring rush. And it's going to pick up organically just because the timing, the season and the weather is going to be changing. And when you start feeling that natural, organic start pulling like the, the demand increasing, that's when you still want to start spending money. Because when demand is high, your customer acquisition cost is low. And so you want to be spending money when your customer acquisition cost is low. And that's going to be when demand is high. That's going to be during the spring rush. So just keep doing the free activities. Knock on people's doors, putting out door hangers, going on social media and asking people to post or going into Facebook groups, all those things are free. Keep doing that and then you'll see this. Like, in one week, the weather will change. Everything will pick, take off. You start getting calls in all the time, and that's the moment you start spending money because your customer AC cost is lowest.

All right, sounds good. Thank you.

You got it, brother. Take care. Next caller's been waiting for 24 minutes from it says Pensacola, Florida, area code 850. Welcome to the show. Thanks for coming on. Sorry for waiting so long.

No, it's all right. How are you today?

Good, good. What's up?

So I got three questions for You. I wrote down some notes that I've been listening to the calls. So. I started my business in 2018 at the Lawn care. I closed after Hurricane Sally. If you remember hearing about it here in Pensacola. I opened again two months ago. As of right now, according to different websites, I'm rated top five in my area. I'm at 56 total services, 23 clients. They're all on contract until the end of the year. My average Property is around 65 bucks. All my clients are on auto billing. I have no monthly properties just because I found it wasn't worth it. Except in the winter. Everybody goes down to monthly just because. I guess that's the area here. I have two, I guess you'd say, quote unquote contractors. I have one full time and then one part time that only works one day a week.

Yesterday. And I'm not as big as these other companies. So when I'm hearing like the hundred thousand or whatever, I'm like, holy cow. But my profit, one day yesterday, I mean I made 274. That's after employees and everything.

So I am paying for leads right now. But my phone rings off the hook like 24 7. I just had to buy another phone because I was tired of my personal phone blowing up. I just got custom T shirts and hats. Other than that, I'm not really doing any advertising. I was until my phone was blowing up off the hook. Here's the part that's gonna. You're gonna kill me for this part. So right now we only have two self propelled mowers. Toro 22 inch. I just ordered a zero turn, but I'm still 20 days out to work a full time job.

I currently upsell with fertilizer and pressure washing. So I guess my question to you is, am I too busy?

I'm at five to six a day, three to four days a week. Where do I go now? And I don't advertise anymore. Should I be.

Do you want to go full time?

Yeah. So I was trying to kind of figure out when because I planned for my birthday, which was March 30th. That was my birthday present to myself.

It's like birthday present myself. More stress. Let's go.

Well, exactly. I just got promoted to my job. I run two phone stores and I've only been with the company for a.

Month and a half.

So I don't really want to leave them. But also I want to be my own boss. So, you know.

Yeah. Do all your contracts end at the end of the year for mowing yes.

Yes.

Yeah. So what I would recommend doing is if you have, you know, 25 or so that you got to redo in the end of the year, try to up them all in terms of price to the point where it make you immediately it makes no sense to keep your other job. And so if that means, you know, raising them all 20, I just do it. You pro. I think you'll lose less than five of them, but you'll literally double your profit and that alone will make more sense for you to get out of your job. You got to make it where it's like it's a dumb decision not to, not to leave your job if that's the goal.

Yeah.

And so right now, like I said my phone, I don't know if I told you right now, according to different websites, I'm rated top five lawn care provider in the area and I'm not even on Google business yet. So is that bad?

Well, it's not bad. It's good for growth. I think the next thing is gonna, what's gonna happen is you're going to go full time and you're gonna have the capacity to probably triple the business just because you'll have more time in your hands. And so, so right now it seems like the phone is ringing off the hook. But when you have three times the amount of capacity because you have the time, you don't have your full time job, you're gonna need every single one of those calls. So definitely not a bad thing. You're gonna be looking at getting a website next spring so you can keep that rush of leads coming in because you're gonna need them. You know, 23 customers is not going to sustain a family. So you're gonna have to get more, more customers anyways. So it's not a bad thing I'm gonna look at. Definitely not that I'd be actually, actually bolstering that as much as possible. Even if you have to turn off your new, you know, if you can't take new customers for the next few months, I'd be focusing on how do you increase lead flow right now not from paying. Like that's the last thing you would be doing. I'm glad you turned that off. But like now it's a matter of getting on Google my business or Google Google listing now getting a website, even if it's, you know, rudimentary right now getting a website because you need all those leads to keep coming in and next spring for there to be a massive rush of customers and for you to make that jump next spring, increasing your prices. When you do the contract, turnover is going to be the determining factor of whether or not you have the confidence to do it financially.

I got you.

So, I mean, yeah, that's my thing.

Now is I feel like.

I feel like I'm doing something wrong, but I don't know what, you know, because when I talk to different business.

Owners, I'm friends and helpful business owners.

And they're like, hey, that's great. You're doing good. You know, but. Because in my area, I guess just according to the research I've done and stuff like that, the average company in their first year only has 10 clients. So I'm. I'm double that.

Yeah, but who cares? The average. You're not going for average and average. The average business goes out of business within a year or two. So don't ever compare yourself against average or average pricing or whatever else everyone else is doing. Figure out what you need to be able to quit your other job, if that's the goal, and then, you know, optimize that. Don't care about average. The average business goes out of business within a year or two. So don't compare yourself against that. Don't compare to other business owners. You know, five out of the 10 of them that you talk to will go out of business the next 24 months. So, like, don't worry about that. Focus on what you want out of the business. Focus what you're able to charge your customers and what your pricing is going to be, because the average anything doesn't do very well.

So right now, according to, like, when I'll go do an estimate, I'm like the highest company that these people talk to in price. But with me, I've been in sales my whole life. So for me, I can build. I build value.

And so, like, there's been jobs most of the times where somebody wouldn't hire me, and then they call me right after the company comes and services it and they're like, yeah, I want you instead of.

So for me, it's not a matter of I can't get the work, you know, because I can get to work all day long. I mean, I could probably make four.

Or five phone calls from leads right.

Now and I'd have to work. So.

I guess, is it. Do I need to focus more on, like, client growth or. Because right now, I mean, we can do an acre in an hour and a half that's fully serviced. We needed edge, everything, edges.

So am I to the point pretty much where I'm full right now, but when I get to zero turn in 20 days, I can keep taking on more work or.

Don'T overemphasize what zero turn is gonna do for your business. If you're at capacity right now and you cannot take on more work and you're getting more leads coming in, like if you can call right now and get four or five more customers, you should, and you should jack their price up 30% more. So there is no question as to what you should do when you fill capacity. You raise prices if you're not gonna continue growing. And so the big unlock for you is going to be going full time when you, you know, at landscape business course we talk about, you know, the different, you know, pivots, the different times when your business really will start to grow. The first one is when you go full time. So when you go full time that's going to unlock massive amounts of capacity. Right now you're at capacity getting a mower, getting a zero turn might unlock a little bit more, but it's not going to solve the problem. It's just not. And so I would be, I would consider yourself at capacity and at that stage you either continue to grow or you raise prices. And in my opinion I would raising prices until you quit your job. And so that way you can maximize your profitability. Stack cash and then next spring accelerate when you switch. When you go full time, that's going to be the kicker. That's all. Triple your business within a matter of two months as you going full time into the business.

Look, we don't expect anyone to be the perfect entrepreneur, but it's your duty to do everything in your power to set your business up for success. And the biggest thing you can do for yourself and your business business is get educated. Eye Candies has developed the MBA for entrepreneurs with you in mind whether you're starting, growing or saving your business. Our course teaches the principles of small business ownership at every experience level. With over 350 plus in depth lectures and bonus live streams, you'll have access from anywhere through the teachable app. Do the right thing for your business and sign up for MBA for entrepreneurs by heading to mikandys.com education.

So obviously my clients that are on contract now at end of contract, how would I go about wording them? Hey, I know you've been loyal to me but I gotta raise the prices. Do I just say that like yeah.

We appreciate you being a customer. Due to the inflation and the increased cost of doing business next year you're you know, starting next month, your price is going to be X amount per month. Let us know if you have any questions. That's it.

Okay. And I mean, I am one of those people, like, if they're, you know, if. If I raise them, for example, five bucks, they want to cancel me. I didn't meet them in the first place, you know, like, I don't know. Like, I mean, I'm at the point now where I can pick and choose what work I would take on. Which I think that's what a lot of people realize too, when they're starting out is that they're like, well, I want this client, this client, this client. You just can't be that way, you know? I mean, now if you don't. Even if, like, if you were to call me, right, and you didn't want to put a card on file, I'd.

Just pass you up.

Right. Like, it's not worth it for me to fight to get paid.

Yeah. So don't worry if you lose a few customers when you raise the price. Just stick to it. You know, you're going to charge. Do you lose three people? You just told me you go get four or five right now if you could, if you had the time. Right. So don't worry about that. I guarantee you, though, you're going to lose a whole lot less than you think, especially if you've been doing a good job. So. So I wouldn't be concerned about that at all. At capacity, it is not rocket science. It's always amazing to me how people like, what should I do? It's like, you either raise prices or you grow. And if you can't grow, you need to raise prices. It's like the most basic math in the world. So just make sure you just raise those prices significantly.

No, I raise my prices every 10 clients I get. I raise my prices because I can't afford to, you know. But I was thinking, is that not a good mentality to have every 10 clients? Or should it just be, or should it not be a number?

It shouldn't be a number. It should just be when you hit capacity. Right? So when. When you. When you're like, I need to hire or I need to buy more equipment, that's why I would raise your prices before you go get a zero turn. Because what you're doing essentially by getting the zero turn is pat. You're absorbing the cost of the extra equipment and you're keeping your price to the same customer. I would rather you raise your prices at the customer they pay for the zero turn in the form of higher pricing. So, you know, just, just don't get into that, that treadmill of buying bigger equipment, bigger trucks, bigger trailer, whatever to be able to do more capacity when what you should do is raise prices so the customers you do get are a much more higher profit.

I got you.

Alrighty.

Well, I appreciate you, man.

My pleasure, brother. You have a good one.

Let you go here. I know you got more. You too.

All right, take it. Bye. Bye. Next caller is from 64 6. Been waiting quite a while. I apologize. It says Bronx, New York. Thanks for calling in.

Hey, Mike, thanks for taking the call. I hope you can hear me. Okay.

Yep, sounds good.

So my question is about growth and this year I started in May and I have about 50 customers at the moment. And this is going to throw some red flags for you, but just imagine capacity and labor. We just talked about that. Those things are not a problem. I would like to grow as much as possible going into next year. So first question is the spring rush. I think I missed that this year. And what do you see out there in terms of how many customers come in, I repeat, mowing customers come in on the spring rush versus the rest of the year. And again, just putting aside any capacity constraints, if you could grow as fast as possible going into 2023, you know, what would be your top one or two strategies?

Yeah. So assuming that I do not have a cash issue, I have plenty of cash. I'm just trying to grow. I don't care about profitability. I'm just trying to simply grow the business. I'd be making sure that all of the organic methods of getting leads are in place throughout the winter. So websites up and ranking with a ton of Google reviews. I have all my social media ready to roll. I literally have all my posts scheduled for the spring rush when I should be focused on closing. I'm not focusing on what post post I should be putting up. I'd be getting all of that in order. I'd be making sure that I also can create relationships with people like property managers and other people that can put me in, like contractors that can put me in a whole bunch of work. I'd be doing all that during the winter when you don't have natural demand. Then when the natural demand comes along, I'd be throwing every single dollar I can towards marketing and I'd be making sure that I'm doing it at the time when it is like usually about two to three weeks before mowing starts till two months into spring rush. That is your golden opportunity, typically when your demand is at its all time high, therefore your customer acquisition cost is all time low. And I'd be spending every single dollar I can during that time and I'd have it all planned out. I have those six to eight weeks that I know I'm going to be marketing. I'd be scheduled about, okay great, I'm going to beat the first week door hanger. Second week, every door direct mail campaign. Third week, Facebook yard signs and Google Ads. Fourth week, I just schedule every single thing out. And I don't care about predicting the number of customers because that the capacity thing's not your problem. So if you have the capital, I'd just be creating a schedule for that spring rush and then sticking religiously to it. Knowing that the biggest variable to that and allowing you to continue growing past 100, 300, whatever customers you're trying to get is going to be the wild card of hiring. And if you're able to actually find those people at the right time now, if you have plenty of capital, you'd probably actually hire them sooner than you actually need them and you would probably just try to sell some project based work to keep them busy until you're recurring work catches up with you in the spring rush. So in that eight week window, you might actually hire people in weeks one, two and three, even though you won't need them to week six, seven or eight. But what you're going to do is sell some projects to keep them busy so that when week eight comes along, you can plug them into recurring work and they can keep going. So that's what I'd be doing and that's what you can do if you don't, if capital is not an issue because that's going to be their expensive way to grow. But it's also the most, most the fastest way to grow.

That's a great answer. Thanks Mike. And I think just a little small follow on on that is how do you think about somebody who's going from one city to two cities? Because you know, this, this year, you know I have a small customer count but it was, I found like there was a natural speed to how quickly you could acquire customers, you know, even if you're spending a lot of money on online advertising, things like that. So I'm wondering, you know, to de risk it for next year. I'm trying to think about there's a city that's 1R south, much bigger metropolis, like should I go down there or not? How do you think about that in Terms of growth, like going from one city to two.

Yeah. The least profitable ways to grow is geographical expansion, like what you're talking about, or increasing the number of services you offer. An hour south is out of the question if you have 50 customers. The only way I would say expand south if you're doing a million dollar business and you're considering going in a larger, a larger area. We moved about 15 to 20 minutes south when we were already over a million dollars in revenue in a little town that had less than 6,000 people. So that is not the method I would approach it from. And I know you, it feels like there's a natural cadence, but it's also due the fact that you haven't you. This is your second spring rush you're going into and that's typically when you get the most natural demand in behind your marketing. So you're going to have a massive push this spring rush rush. And if you stay in your current location, you'll be plenty maxed out with leads. I would definitely not recommend moving an hour away. That's a very long ways away.

Makes sense. Thank you for this awesome advice, Mike. Love the show.

Take care, brother. Take care. All right, next caller is from 678. It says his name is Martin, but probably wrong. Welcome to the show. Thanks for coming on.

Hello, hello, hello. Six, seven, eight, Eric. Oh, we're scrambling for the cell phone.

Hello.

How's it going?

Hey, what's going on, Mike?

Good, good. What can I help you with, brother?

Yeah, so just to kind of give you a little backstory on my company, I'm going for my 30th.

This was my third year.

Basically I started by myself right now. I just turned 27. I started when I was 23. Thankfully it's been, you know, roller coasters. So thankfully everything's been good. When I was 22, I purchased my home and I just refinanced my home not too long ago. Thankfully I got a good chunk of money out and I reinvested in my company. So I bought a second truck as well as a little bit of equipment. And my company is making, hopefully makes about 250. 200. Right now I'm already at 140 and I still got, you know, good month and I got good projects coming up ahead. So I should pretty much be over the 200k mark. And it's just me, another full time worker and a part time worker. So I'm coming to the point where I feel like I'm not really efficient. I guess you can say because sometimes, like right now I'm not really making too much money because like I said, I've reinvested a lot back into my company. So I just bought a truck, I bought the, the rank wreck on the truck, you know, but I just bought, I just reinvested which I don't really see like too much of a bad thing because you know, thankfully money is not too much in an issue since I've been saving up and you know, I don't really live in high demand. I'm, you know, really budget on my money, my personal side. So I just reinvested on my company. But I'm just not sure where do I take it from here as far as kind of scaling it. Because with clients, I'm pretty much already booked up with 60 clients. But in those 60 I have commercial properties which you know, it takes more than me and two other workers to do in one day. And the other days I just kind of do regular lawnmower, lawn maintenance and you know, on the weekends that's when I typically do my projects. Mulch, pine straw or clean a up. And I kind of just got everything nice and schedule and then yeah, I just ran the numbers for the first six months and I pretty much got like a net profit of like 20 something K. But like I said, I kind of reinvested a lot of that money back into the company. So I just want to make sure that I did the right move. And going forward, should I just tell how should I take it going forward?

Yeah, like honestly, in four years to grow your size, you're not in hyper growth, you're not pouring money back into the business in terms of like losing cash. Right? Like the rate at which you're growing is, is not slow, but it's not like you're tripling every single year. Right. So I don't think it's a good, I don't think it's a good thing to buy into this notion. And it's very, very common in our industry. And that's like, oh, investing all the profits back in the business. Like look, look, if you're growing over the course of four years or 200,000, you're not like pouring money back into the business. And so what I would recommend doing is really locking in and focusing on the actual reason why we get into business and it is creating a profit. And so four years in, you got to start thinking about profitability. It's no longer, you can no longer use, it's like, oh, I'm new, I'm growing 50, 60%. Every single year, I grew from 100 to 300 to 800. That during that period of hypergrowth, it's okay to be unprofitable. You're putting money back into a business and the assets going up. But at your size, I'd be really, really taking a year and trying to raise your prices and making it really profitable because then you have options. With that higher profit margin, you can go grow. Because now you have capital to expand, you have capital to grow, you have capital to buy more equipment, you have capital to go do marketing. And so I would highly recommend, if you're at your stage and you're at 10% profit margin, you're four years in. I would take a year. Oh, maybe only go to 250 or 260 next year, but now you're gonna stack away 70, 80 grand inside of your pocket because you raised your prices. So what are you charging per hour right now?

So as far as law maintenance, we probably like at 120, but if we do a cleanup.

Yes, yes.

And sometimes if I bring a third one, because some days, like I said, I do commercials. So I bring three people and then I do the commercial.

So.

And you're charging 120 regardless for that?

No. So for that one we are like 140? Yes. Yeah, about 140. So when I bring three people per day, I'm pretty much making about average between 750 to 900 on long meetings per day.

Yeah, but the problem is, the problem is if you have three people on your charging 140 means you're making like 46, $47 per man hour. Like, the per man hour is what you want to measure, not how much you're charging for the crew. And so 46 is extremely cheap. Like extreme. You, you got to get that above 60. Like, you got to get that but up 60. And so, like, I would highly recommend, you know, instead of trying to focus on growth right now, I would really be. Because you just don't have the finances for it. Like, I would be really focused on how do I take a 10 profit margin business, which is what you're currently at, and make that 25 to 30 profit margin business, because you can do that at in annual revenue. And to do that, you're going to have to raise your prices. And if you're busy, you got lots of leads coming in, it should be no, no problem to go raise your prices to your customers. But I would highly, highly recommend trying to get a 70 to $80 an hour, like very much so. And if you lose customers, that's fine.

Yeah, so I just raised prices on my. And pretty much I'm on my homes. So bi weekly, if they want to buy. Weekly service. Right now we're talking about $70 each long minute. Obviously weekly. We pretty much are almost the same thing with some customers. So my goal was this year to just kind of reinvest back on my company and next year just kind of work pretty hard and efficiently and just kind of save up money. And then hopefully, you know, next year to. I would like to buy another property. That's kind of my goal. And yeah, so this. This year I kind of did took. Yeah, I went a little bit back when I kind of reinvested in my company.

What's investing in your company? What does that mean to you?

So basically, whenever it's what I think is just like. Like, for instance, I just buy the truck and then I bought some equipment. I bought the Ram rack, which is, you know, a little pricey, close to, you know, a couple thousands.

Just, you know, what you doing Revenue. What you doing revenue in 2021, what was your gross revenue last year?

We would 1:1. So revenue. We did about 160 out of the 160. I kept about, I think, 70 to 80,000 out of the 160 from last year. So this year I'm pretending to make about 240, give or take 230. And obviously. But obviously this year I'm not really keeping it, but much and I'm throwing back to the. To the. To the company, if that makes sense. Which.

Which is okay.

You know, like I said, thankfully, I'm not really. Money's there saved up. So, I mean, I know we're going through the, you know, slow days, but I mean, I think we have. I still have good. Pretty good months. I still got projects lined up. You know, I'm doing decent. I mean, obviously I'm not a millionaire, nothing like that. But thankfully, I. I can get by with my bills until next year, you know, pretty comfortable, I would say, and, you know, start the season back over. So that's my goal for next season. Just kind of focus really hard, save money, and just kind of just start bringing in money and hopefully towards the end of next year or somewhere around that ballpark, we try to get another house and kind of just go like that. Because this year, like I said, I just. I did dump a lot of money. I just want to make sure that was, you know, a little bit better choice of me or should I Just saved it. But it's just, I was kind of to the capacity and I just wanted to get more of work truck for the, for the workers and that way I can kind of just you know, slide and get a little bit, get off the field and just kind of manage things more and go that side of the route.

Totally, man. Well, good luck to you, man. Yeah, I think with two trucks you'll be, you'll have the capacity. It's really just about making sure you're profitable in that meantime time and ensuring that you have that.

That margin to be able to get through that. So best of luck to you though.

Sounds good. Thank you so much, sir.

You really take care. All right, last callers coming from 208. Welcome to the show. Thanks so much. Appreciate you coming on.

Hello.

Hey, how's it going?

Oh, hey, you can hear me now. So, Mike, I, I, you, you were my inspiration to buy this company. I started watching your videos and, and I was like, okay, yeah, that, that's such a good team, you know, taking your, your small business and franchise it. And I appreciate all the advices and everything that you have developed throughout the, the days. But so because of that, I bought my company. I bought it back in April and it was a.

It was a baby boomer. You know, he was getting ready to retire. He was like, yes, I'm ready to retire this company that I've built for 16 plus years. And the way that he had it structured was that somehow he was reporting some of the money into taxes and some of the money. No, because it was more like cash. And it was like those customers that he had were friends of friends, really close. It was total of 25, 26 customers.

And he was just doing it by himself. He had from lawn care to sprinkle repair and snow removal here in Idaho. Because I'm from Idaho, we have just from April all the way to what, late September?

October.

And then it becomes a snow removal season. So anyway, so I purchased this. It's, it's owner finance.

So I didn't have to go to.

The banks and ask for SBA loan. It worked out good, but the financials were not there. And that's kind of like something sketchy for me at first. And I was like, okay, I need to know more about this company and stuff. So he took me around, met the customers and.

It felt, it felt good at first, but now we're, I am, I have a full time job.

I got this company and I think I'm, my time is just, I don't have any time left to do anything, either grow or get more profit or anything like that. So my vision was just to hire somebody, but that somebody I'm. I'm having a hard time to hire, whether it's a.

Very helper off the street, you know, just, just to, to help me get caught up during the week. Because I do this during the week and mornings and stuff, and then I go in the evening to my other job. And.

It'S so hard for me to find people that are reliable and wanted to grow with me as a company as well.

So I don't know.

We're, we're heading towards the snow removal and I got bigger contracts on that. And his personal fall.

What is your recommendation of how to hire somebody, how to advertise that where it's personal? Whether it's three in the morning, four in the morning, we gotta get out there and start shoveling snow.

Can you sick days at your job? Can you use sick days at your job? Bob, if it starts snowing at 3am can you call out sick?

Yeah, I could, I could, I could. But I don't get as many. What if, if it snows twice a.

Day.

I have to go. If it's grading, then.

How much revenue do you expect to get from snow plowing? How much revenue? Like if you have a good snow season, how much you expect to get?

It's my first year, so I have no idea.

Okay, how much did you make in total revenue this year? So far?

I'm looking at 26,000.

Okay.

Okay. So this is, this is something you got to do without an employee. In my mind, you don't have enough profit or revenue or margins to make it work. Work with an employee. I don't think hiring is the issue, to be honest with you. It's. If hiring is the issue, it means your pricing is too low because that much revenue can be done evenings, weekends, et cetera. What you're running into is a scheduling issue for snow, which means you have to drop stuff and get it done. And that's when subcontracting might be the best option for you. And that is if you're in a bind and you can't get the snow plowing done, you have someone that you call or someone that you fall back on that is a subcontractor is going to make. Make a percentage of the revenue or a cut, or you pay them per hour and they get the job done, but you don't have, in my opinion, enough revenue to go get an employee just setting them up. Legally getting everything in terms of liability. Your liability insurance will go through the roof for snow plowing if you got an employee. And so I don't believe this. This is an employee issue. This is a matter of finding a subcontractor and then trying to maximize the time that you can be on the job and be flexible as possible with your current job would be calling out some sick, whether it be talking to your employer and just like, hey, there might be times during the next few months I have to call out, can I get some sort of leeway around this so I can keep this job? Because I want to keep it and kind of put out there the threat that you might leave if you can't. That's, that's really the, the goal, in my opinion. It's not finding an employee at your size. You're not trying to find an employee.

Okay. Yeah. And the hard part is that, that it's personal fall. So it's not like predicted, you know, okay, I know that it's going to fall two weeks of the month. What if it doesn't? So then the employee or me, I don't get paid for those two weeks. But still bills are going to come in and stuff.

So it's kind of like.

This size and what you're talking about in terms of scheduling being the issue, a subcontractor is going to be your go to here year. You do, you just simply don't have enough revenue or the predictability of the schedule when it comes to snow. Like, you don't have work for an employee to do if it's not snowing. Right. So no employee is going to sign up with you with the hope that they're going to get work every couple weeks. Right. So I would highly recommend the subcontractor out. Look for other contractors doing snowplowing. Just be open, honest with them. And okay, here's what I'm getting. I'm paying. I'm willing to give you X amount either per hour or per push or however you want to do that. But that's going to be the best route for you. And leaning on contractors is a whole lot more dependable than leaning on an employee that's, you know, used every couple weeks.

Right, right.

What would be your recommendation for getting somebody in a contract? Because I think I already got too much in my plate. But not alone. I was just.

Just call other contractors that are advertising for SnowPalm. Like, hey, hey, I'm looking for a subcontractor. I can't get all my jobs done. Are you interested? No. What do you charge per hour? Right. So I would just. If they're advertising for snow, it means they can, they have capacity. And so I'd be calling them and just being, saying, you know, hey, are you willing to take a sub. Subcontracting? Are you willing. What's your hourly rate? And just going from there.

I see, I see.

Okay.

Best of luck to you, brother. Absolutely. You have a good one.

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

Sam.