Building a Profitable Contracting Business With Brad Huebner

Welcome back to the show. I'm your host, Phil Risher. And on today's episode, we're going to be discussing how to get higher profits, more free time and build the contracting business that you've always dreamed of with Brad Hebner. Thanks so much for joining us today, Brad.

Phil, thank you so much for having me. Looking forward to it.

Yeah, likewise. So Brad is with hammer and grind. He's also the author of the Contractor Profit Blueprint, a former marine and successful construction business owner who has transitioned to coaching contractors to achieve financial freedom and build a business that is successful. His approach focuses on integrity, perseverance, helping clients overcome industry challenges and thrive. So Brad, can you tell us a little bit, how did you get into the construction trades type of space?

Yeah, it's a long story. In high school I took architects for drafting. We had what's called TNI classes. It was like a three credit hour class. My junior senior year in high school, I thought I wanted to be an architect. Turns out you have to have good grades and actually like going to school and all that stuff to be an architect. So that's why I ended up going into the military right out of high school and did that for four years. Got out and then, but I don't know, I guess it was maybe about four or five years later I had an opportunity to go be a superintendent for a local developer. And that architectural drawing that I had taken, you know, I understood buildings, how they go together, walls, you know, I don't, I understood the mechanics of it. And my family's always been kind of a jack of all trades handy. My dad was a diesel mechanic. You know, we, if we needed a new roof, we'd put it on. If we needed a fence, we'd build it, that kind of, you know, that kind of thing. And so it was always handy. And I had an opportunity to go work for him. And then a couple different things happened and I ended up going to work for a, one of our subcontractors who was a finished carpenter. And so I started doing finished carpentry for him, became his lead guy. Did that for about two years. And then I end up starting my own business after that. So that was in 2009 when I started my own business, you know, right in the middle of the housing market crash. I thought that was the best time to start a construction business. And I did that for.

What's that you went like remodeling or new homes or just anything or.

I got, I started out as a handyman because that's I had a thousand dollars in the bank, and I had a few tools, and that was really the only thing I could start. When I. When I went to work for the. The finished carpenter, we were doing new construction. We were building home, you know, trimming out new homes. And that's, like. I started working for him, and then we trimmed out one home, and then it was like, oh, by the way, there's no more homes being built.

Yeah.

Right. So we. We had to, like, transition to doing remodels. So we started doing remodeling, but there wasn't enough work. I mean, I was only working, like, 20 hours a week. I wasn't getting enough hours. Right. And so I was like, man, I could. Could work. I could start my own business and, like, work 20 hours a week and make the same. And that's kind of the segue for me, starting my own business, you know, I mean, if we were. If it was busy and we were doing well, I don't know that I would have ever started, at least not then, because I would have been busy. So, yeah, I started out as a handyman, did that and then that. People was always asking, what, do you do remodels? Do you do bathrooms? You do this, this? And so that kind of led into doing remodeling. And so later on, after a few years, I started doing more remodel projects. But then we were. I was still doing handyman stuff, so I kind of ran it, like two different divisions, if you will, but through. But I was struggling for a long time, Phil. Like, for nine years in my business, I was getting by. I was. I had increases in, you know, in revenue every year, but I was never really paying myself enough. I was never really making good money. And I actually found some business coaches. I went online, I was reading books, found some business coaches, and they helped me understand some more of my numbers and stuff. And through that process, I fell in love with the idea of coaching. And then several years later, I had an opportunity to start my own coaching business. And that was really by accident, too. But honestly. And then. But it worked out. It was in God's plan. Everything worked out the way it was supposed to. And then here we are, you know, three years later, doing coaching full time. So. That's a long story.

No, that's awesome. Can you tell us a little bit? So a lot of times I see this as, like, a handyman. And then it's like, wait a second. Bathro is, you know, five grand, ten grand. I should just do those. I'm not going to do this, you know, patch these walls. Can you talk a little bit about that shift? Because you, you said it takes nine years. I think that's a really hard shift for people when it comes to, like, these bigger ticket, long sales processes, cash flow. It changes the game from a lot of the onesie twosies, mo and go type things to like, these big projects. What does that look like for your transition?

Yeah, I mean, it, there's, there's pros and cons to everything, right? So, I mean, I know there's, you know, there's handyman companies out there that are doing multiple millions a year in revenue, and then there's, and there's remodeling companies doing the same. So it's like, is it a big ticket? Is it a low ticket? You know, if you do low ticket, you're just doing more of them. You know, now you got to deal with scheduling, you got to deal with all the complexities. If you're doing high ticket, maybe you only got to do four jobs a year. Right. That removes a lot of the scheduling stuff, removes a lot of the complexity of multiple projects. You got to kind of pick your poison, if you will. But what I, what I've learned and what I learned in my business, and then also what I learned over the years working with other contractors is generally they, they offer too many services. And what ends up happening is that there's one or two services that are really profitable, but then there's, you know, anywhere from one to eight other services that are not as profitable, but they feel like they can't give them up. Right? They feel like if they give up these other services, it's not going to work. I was talking to someone yesterday, actually, who's interested in coaching, and he offered two different services. And one of them, he's like, well, I make more money doing this other one. I'm like, well, why don't you just do that full time? He's like, well, because in the wintertime we slow down. And so this other one kind of carries us through the winter. And it's just kind of that mindset of like, you know, I, I fumbled my way to where I'm currently at, and I don't want to make a major change in my business like eliminating services or rebranding or changing direction. Even though stuff's not working, I'm just too afraid to make a major change. And so a lot of guys just stay stuck.

Yeah, I definitely get that. You also mentioned about not making much money. What is that? Does that mean or what should someone be paying themselves? Or how did you, it's just like, hey, I wasn't even getting a paycheck or there was no profit at the end or what was that feeling? And what was, how did you, how did you diagnose that for yourself?

Yeah, I mean, it was just, you know, I, obviously where you live matters, you know what I mean? So if you're living in New York or the former la, because I guess all of it's gone now. But if you, if you, depending on where you live and the cost of living, that's going to change. Right. I live in the, I live in the Midwest, I live in Indiana. It's one of the cheapest parts of the country to live in. And so you know, around here, if you're making $100,000 a year, paying yourself a hundred thousand, that's, that's pretty good. I mean you can have a pretty good life. Now that's in the last couple years, inflation's kind of diluted that a little bit. But if you make a hundred thousand in New York, that's not very good, you know what I mean? And so like it depends, but as a business owner you really should be making, I would say a minimum. Like you should be paying yourself a minimum of $100,000 a year as an owner and then up from there. So whether that's A, you know, 100, 150, 200,000 obviously depends on the size of your business and how much revenue and all that stuff. But I mean, around here I had a plumber, he was a one man show. He did not want employees. He worked whenever he wanted to, he, you know, took off whenever he wanted to and he made over six figures and he was perfectly happy with that. And so it really, there's a lot of variances to that.

Yeah. So sounds like. Well, first off, if you're not paying yourself a regular paycheck, that's, that's substantial in size, potentially, you know, 70, 80, 90, $100,000, then you probably feel the same way that Brad's explaining. And also you don't have to live like that. There is a better way that you could structure this. And I think that's what you coach people on in your book, the contractor profit blueprint. You have four steps, I believe.

Yes.

What are those? Or does that kind of help with this process of paying yourself right, doing the right stuff?

Yeah, yeah. So the four steps, the first one is one that no one wants to do, but it's the most important one. And that is getting your. Your mindset, fixing your mindset. I call it the seven figure mindset mastery, right? Like, you have to fix your mindset. Because here's the reality of it is if. If myself or Phil or anybody, you know, some talking head on the social media is like, you got to raise your prices. And you're like, that's great. That sounds great. I love to raise my prices, but no one's going to pay that. You know, pay that much in my area. That's a mindset problem, okay? Because if you don't believe that you can charge more, then you will never be able to charge more. Straight up, you know, if you're even. If you're like, I'm gonna try it, Brad, you said to raise my prices, I'm gonna try it. And so I'm gonna go out there and I'm gonna. You know, a project that I would normally charge 20 grand, I'm gonna charge 25 grand, I'm gonna add $5,000 to it. But in the back of your mind, you're think you're talking to the customer and you're getting ready to tell the customers, 25,000. And you're like, man, I don't. There's no way they're gonna pay this. It's too much. And, you know, and you kind of squeak it out. It's probably maybe somewhere around 25,000. Like, they're not buying that. They're not. They're not catching it. There's no confidence. They don't believe it. And then you're going to basically sabotage yourself in that process. So mindset is the most important thing that we got to get right first. It's the foundation, if you will. The second thing is pricing for big profits. That's where it's actually about how you price your jobs, right? Making sure that you're getting the correct markup on your jobs. And I always talk about getting a 50% gross profit, which equals 100% markup, right? So your cogs, your total cost of goods sold, your labor and materials, equipment rentals, trash, all that stuff times two, is going to give you a 50% gross profit at the end. And that scares a lot of people. Just, I mean, straight up, that scares a lot of people. But there's a second part of this equation with the pricing that most contractors get wrong, and that is they don't use a full burden labor when they're figuring their labor rates. So if I'm talking to someone and they go, I got three employees, you know, John makes 30 bucks an hour. And Chris and Tom make 25 bucks an hour. And that's what they figure. I mean, they may add in FICA because they know they got to add taxes and stuff, you know, so Maybe they're charging $32 and $27, they add $2 an hour to cover that. But what they're consideration is uniforms, cell phone reimbursement, you know, vehicles, if the lead guys drive in the company vehicle, the gas, the payments, the insurance, the maintenance. But even beyond that, here's one that no one ever takes into consideration, Phil. Your weekly meetings, any kind of meetings that you have that are non billable. So if you have one one hour meeting every week, that's 52 hours a year that you're not billing a client for. That's right. Right. And so if you're taking, if you're paying someone 30 bucks an hour. Right. Times 52 weeks. Yeah, that's. You're not, you're not making that money back. That's right. So you have to factor in, you know, lost time due to meetings. If you send them the training, if you send them to some kind of industry standard training for a week, you're not billing during that time. Like all of these costs are not being associated. And so you have a $30 an hour employee who's really costing you like 40 to 45 dollars an hour, and you're only billing the customer or figuring your labor burden at say $32 an hour. Now all of a sudden you're losing anywhere from five to $10 per hour of, you know, unrealized profits because you're not even factoring it into your cost.

That's right. And literally even building in profit into what you're actually charging on top of that. Because a lot of times people just say, oh, it's 30 bucks, you know, it's 40 bucks for this $10 gap. They don't think about the structure, the burden rate and actually what it's going to cost you and the profit side of things.

Yeah, I mean, there's, there's all kinds of nuance and complexities. We can talk about, you know, your, your burn rate or your overhead recovery and all these different things that go into that. But I like to kind of keep it simple. I like the kiss method, you know, keep it as simple as possible. If you just get your labor burden correct. I have a worksheet that I, that's available that's. It's called the labor burden worksheet. You literally put in all these things and it Spits out what it costs you to, you know, for your team and stuff. You get your labor burden right? And then you get your markup correct. You'll have enough profits like you, you will be making good money, right? It's no longer the situation where you're making okay money. You gotta wait to close this job and you're gonna make a couple thousand dollars profit. It's like now all of a sudden, you're making an extra 5, 6, 7, 10, $20,000 profit on a job. And in one or two jobs, it completely changes the trajectory of your business. So the second thing is getting your pricing right real quickly. The third one is accelerate your sales. That's really combination of marketing and sales. We get your marketing right, so you're getting the good quality leads. And then the sales process is one of the most important things that I teach in my program, but it's eliminating people who are not going to hire you in the first place. We don't do free estimates. No more free estimates ever again. Stop wasting your time and giving away for free. And we eliminate, on average, most of my clients will eliminate about 10 hours per week of wasted time on sales leads that would never convert no matter what they do, right? So we're eliminating time. And so right there is the, is part of the freedom formula. Like you're gonna, all of a sudden you're gonna have like an extra five to ten hours a week of more time.

That's right.

Like, oh man, I got all kinds of time now. So that's the third thing. And then the fourth thing, and this is, this is on purpose. The fourth thing is Systems for Growth and Freedom. Okay? We don't, we don't work on systems until we get our pricing right. And this is, I see a lot of contractors get this wrong because they don't get the pricing right. And so they, what's, you know, how do you grow your business? Well, you know, I'm only making five bucks an hour off of my helper, Johnny. And that's not, I'm not making enough money. So what do I got to do? I got to hire more people, right? I just got, I got to hire more people, I got to bring on more crews, I got to do more jobs. I got to do more, more, more, more, more. And that's not the right way to do it. Like, you have to be profitable. Even if you're a one man show or you have a helper or three employees, you have to be profitable where you're at now. And once you're making the money, then you work on systems, then you can start building. And here's the beauty of it, Phil. You actually have money available that you can invest in the systems now. You can get a software to help you out now you can buy tools, you can invest in a trailer or whatever it is that you need. You actually have money available now because you're profitable. And that's why we do it last. It's usually people want to, they want to play the efficiency game. This is, this is a lie I believe, by the way. And then I'll shut up after this. Phil. The lie I believed is that the only way you make more money is to be more efficient. That's the only way, like you have to be more efficient. I used to believe that everyone, you know, somewhat charged the same amount. I mean, vary it, but like, you know, maybe two or three dollars more an hour or something. But you just, you just do more jobs and you're more efficient. If I could do a job in two hours, that takes you eight hours, I'm going to make more money. That was the lie I believed. And so, you know, I end up with like 40 grand worth of tools sitting in a warehouse that I would use twice a year because I believe that the efficiency of that tool was going to make me more money. And so that's, that's just one of the lies that I see. So I, I'll stop talking now.

No, but it makes sense. Before you go and you try to scale your company, you need to make sure that you have a profitable scalable model that can scale because that's gonna hurt in the long run. But before we talk about that, I want to, I want to pinpoint this because I know when you said this, people's ears perked up. You said, no more free estimates. So. Yeah, so what does that look like? How do you. Do you charge for your estimates before you go out there? Like, what does that look like? Because people are like, oh, well, that's my whole business. I go out on free estimates and then I give them an estimate.

Yeah. So this is, like I said, this is the bread and butter of what I teach. And it's not something, I mean, I can't teach you the entire process, you know, in a 30 minute podcast. However, the main premise, and I will admit there's a little bit of clickbaitiness in that, you know, and saying no more free estimates. We are pre qualifying people over the phone before we ever go to their house to make sure that one they're qualified you know, lead, meaning like, you know, I can run out there and jump circles and do all kinds of fancy stuff for you. But if you need the project done in two months and I'm booked out for six months, I'm not getting the job. Like there's nothing, like there's nothing I can do to make that happen. Right. So I can eliminate any kind of time restraints and then I can eliminate the biggest thing, which is the budget. You know, if you want a $50,000 project and you only have $25,000 to spend, there's some realities there that are not aligned. And so, you know, we need to address that before I go out there and, you know, spend a bunch of time talking to you and wasting time. So basically it's just pre qualifying people over the phone before we go out there. And then yes, I teach my clients to charge a consultation charge because really that's what you're doing. You are consulting with them. You are, you know, giving them ideas. I mean, I mean, if all you do is show up and whip out your tape measure and measure two things and then write down an estimate, then that's, you're, you're not really giving them any value. I mean, that is truly just giving them a free estimate. But we all know that when you go out and talk to a client, they start asking you questions, you know, what kind of, what's the best material for this? Or how should we do this? Or you have any ideas on how to do this over here? And now we're consulting and you should get paid for that because you're providing real value. So the whole no more free estimates is really about eliminating the people who are never going to hire you. Right. I mean, there's people out there that just need three estimates to turn into insurance.

Exactly.

They already got their buddy who's going to do the job. He just needs two more estimates to turn in. There's nothing that you're going to do to win that job. It's impossible. I can eliminate those. I can eliminate the time people. I need it done next week. You know, it's a four week project. I need it done next week. I can eliminate those people. I can eliminate the people that have not even a remotely close realistic budget. So I can eliminate a lot of these people that are never going to be good clients. And that leaves a smaller percentage of people. I may not get the job because I'm still a little bit too overpriced or whatever, but I have a lot better chance. I've narrowed it down to a better pool of leads. And then the final thing is charging for consultations. And that's where the rubber really meets the road. Because if I'm charging someone 250, 500, $2,500 to come out there and meet with them and they're willing to pay that, then they're serious. Like the job's pretty much already sold at that point. It's just getting the final numbers together. So that's what that is. But there's a whole sales system that goes behind that, that allows you to do it. And that's the more complex part of it.

That is awesome. And I think people listening that you need to really consider the amount of time that you're spending running free estimates and just running all over God's green earth trying to pump out estimates, because it's more about the pre qualification and getting in front of good quality leads, not just going out on any single lead that you can. Could you give us like two or three questions to pre qualify? You mentioned about, like, what's your time frame question? Do you like bracket? Hey, so in your area for a new kitchen is usually X to X, you know, kind of thing. Or do you ask them a budget or how does that conversation go? And then are there any other, like just boilerplate type of questions for qualifying?

Yeah. So in the book I actually have, there's nine questions that we ask. But to answer your question, don't ever, if anybody takes anything from this podcast, don't ever, ever, ever ask people what their budget is.

Yeah.

And you're like, well, how am I supposed to know then what their budget? I'm glad you asked, Phil. The reason, the way you do it is you tell them a ballpark.

Yeah.

You give them an idea. And I like to equate this to like playing poker. If you and I were playing poker on the, you know, on the last betting cycle, the flops down, we're going to bet. And you're like, I don't know. Is Brad have a good hand? He's, you know, he seems kind of confident and stuff. Then I say, hey, Phil, guess what? I'm going to show you my cards. I show you my hand before you bet, how confident would you be to bet? Now once you know what I, what I have, right. You'd have 100 confidence. So what we're doing whenever we give people a ballpark estimate is like showing them our cards. Because what is everybody? What does every client think if a, if they tell a contractor what their budget is? I'm sure you know this. What is it that everyone thinks?

Yeah. Oh, well, now they know, you know, what they can come in at or how they can. You know what? It's. It's not right. But that's the kind of the game that they're trying to play.

Yeah. I mean, look, if I say, well, my budget's $30,000 and, and you really could have done that project for 25, then guess what? You're going to be like, oh, hey, 30,000. That's exactly what the budget was. You know what it's gonna like? That's what everybody thinks. Whether it's true or not, that's just what people think. So we just eliminate all of that and just simply say we go through a process. But when we go, when we get to the investment portion of it, it's like, you know, I got enough. I got all this information, blah, blah, blah, blah. Is it okay if I share with you what something like this might cost you, or is it okay if I share with you what other clients have invested in similar projects? You know, some kind of language like that. Of course you're going to say yes, because everyone wants to know. And then I can put some little disclaimers on there. And I could say, well, you know, depending on how nice we go, if we go hgtv, cover magazine, just, you know, I like to use the word blow both your socks off. If we just come in there and blow both your socks off, this project, you know, could be as much as $50,000. But if we come in and we're a little more conservative, maybe we only blow one of your socks off. We can come in, you know, we can come in around the $30,000 price point. Which one of those conversations should we be having?

Yeah. And then it leaves it up to them, and then they'll say no. Well, that's way out of my budget. Or this one's good.

Way out of your budget? Yeah. Well, I mean, I hear that all the time. How much were you hoping to spend? Yeah. Now you're going to tell me your budget because I showed you my cards. I said it was going to be 30 to 50.

That's right.

You have no reason to lie to me now as to how much you actually want to spend. Yeah, right.

Makes complete sense. And then. Oh, go ahead.

I was just saying. So if you said, well, my budget was, you know, 22,000. Now I have information now, like, you know, on the low end, I'm around 30. They're at 22. We got an $8,000 gap. We got to try and close in now. Now at least I know where you're at, right?

Yeah.

And I could determine like, well, we can get down to 22, but we're going to have to remove a few things from the scope. Like you mentioned that you really wanted to have heated tile floors. You know, we could take that out and you know, that's definitely going to save a few thousand dollars. And when you start removing scope about what they want now, like, well, wait a minute, no, that's not. I actually want those things. And then before you know it, that twenty two thousand dollar budget creeps up to that 30, 35, whatever it might be.

That's right. Yeah. Makes complete sense. I mean, I think when you position yourself one as the expert, you should, you know, you don't want the, the prospect telling you how much something costs. You're the expert, you need to tell them how much it should be. That right there builds the authority part of it. And then how do you shift to the next phase of like, okay, for this to come out and do an analysis or whatever is going to cost 500 bucks. Is it like to put together an estimate or what does that sound like?

Yeah, that's where a lot of people get tripped up. And I always tell people when they first get in, I'm like, hey, don't start charging right away because you can lose a perfectly good lead and a job because you don't do it the right way. You do have to kind of practice this and actually understand. But when we're on the call and you know, if, if you were a customer and we were talking and we got the timeline down and we got the budget, we're in the budget range. You know, everything's lining up, we're gelling really good. The next question I might ask is, and this, by the way, this isn't one of the nine questions, but it's just a question I would ask is like, you know, Phil, it sounds like we're good on timeline, we're good on the budget. I mean, where do you think we should go from here? I'm giving you the rain, I'm giving you the decision making power here. Yeah, okay. And then you're going to be like, well, I think we'd like to have you come out and give us an estimate. That way we know exactly what it's going to cost and blah, blah, blah, blah. Mike, perfect. I'd love to come out there now. We do. Whenever we come out there and do a consultation with you, we do Have a small investment up front of X that does get credited back to the invoice, you know, once we move forward. But I just wanted to let you know that we do have a small investment up front. Just confidently. And you say it now that's. That's just one variation of it. The one thing that's about sales that I'll add here, Phil, is that sales is not a linear process. So I'm very skeptical of anybody who's selling you a sales program where it's like scripted step by step and follow these things and you're going to have. Sales is not linear. If I'm dealing with a different a D personality from the disc profiles, if I'm dealing with the D versus is or C, those are four different personalities and they all negotiate and talk differently. And so if I don't know this and I don't get real sales training, it's going to be a little more difficult. I may be able to really easily close one type of people group or one type of personality because I gelled with them really well. But the other two or three I have a hard time closing because I don't understand how to talk to them. So one of the things that I teach with my clients is not like, follow these scripts. Now. We do have the questions, and those are just like calibrated questions. But it's more along the lines of learning how to have an emotional conversation with people and then communicating with them really well. And so that's really where the sales magic happens.

Yeah. And I can see with the mindset side of things, it's such a big mindset shift of the confidence and not feeling like, oh, my gosh, is the person, can they pay this or is this too much? Or even feeling like, bad about charging them, quote, unquote, you know, more or something. It's so much in how much you believe in what you're doing and helping people.

I used to. I was a guy, like, my first coach that I ever hired was a mindset coach to eliminate a bunch of limiting beliefs.

Yeah.

Because that's. That's how I felt. You know, I love my dad. I love him to death, but he is a penny pincher. I mean, that dude, you know, he could sell snow to Eskimos. Like, he. I mean, he is just. If he's not getting an extraordinary deal, he's not doing it. And so that's kind of the. That's kind of how I grew up. You know, everything's got to be a deal. Matter of fact, when I Told him when I started my business, and I told him this was in 2009. I said, I'm going to be charging 40 bucks an hour. You know, for my handyman stuff, I was going to charge 40 bucks an hour. He's like, you can't charge that much. You're ripping people off like that. That was. That was the response there. Right. And so that was. I had a lot of. A lot of head trash, a lot of negative beliefs around money, and I see it all the time. I actually had a call last week with another partnership, contractors, and the one guy's like, I just have a hard time charging more because I feel like I'm taking advantage of them. Right. And I said, well, that's because you're. You're bidding with your pocketbook.

Yeah.

You're not bidding with the client's pocketbook. You're bidding with your pocketbook. So because you wouldn't pay that much money for something.

That's right.

Then you automatically assume that everyone else wouldn't want to pay that much money. But I guarantee you there are people out there that were willing to pay because for them, the money is the least valuable currency they have. The people that are willing to pay money, they value time and energy and, you know, easiness and comfort over the money itself.

Yeah, you. I mean, absolutely. And. And a lot of times there's a really good book called Thou shall prosper, and it's. It's a. A religious type of book, but basically, you know, it's about that, like, you are built, you are made, you're given these gifts to be able to prosper, and it's okay to prosper. It's not a bad thing. And on top of that, to your point, people value time and quality and other things, and the money is just one part of that equation. It's not the only part of the equation. And even if you were to ask them, hey, is every kitchen remodeled the exact same. No. Is there better quality? Is there better material? Is there better time? Is there better communication? Is there better. All this stuff goes into it that justifies costing more or less.

Absolutely. And so there's always, you know, room and wiggle room and stuff. And I. One of the thing I always. The visualization I like to paint is when we're having a conversation with a client, usually over the phone, sometimes if it's in person, but it's like we're sitting on the same side of the table as they are, and we got our arm around them, and we're like, hey, let's figure this out together. Let's figure out how to get you what you want, you know, at the budget that you can afford. Let's work on this together. But what a lot of contractors do is they treat it like it's an interrogation. They're sitting across the table and it's like, you know, they answer the phone, brad's contracting, and like, oh, yeah, Brad, I'd like to get an estimate on a, you know, a bathroom remodel. And the contractor's like, well, I'll just tell you right now, we're booked out for six months. So if you don't, you know, if you want anything sooner than that, then don't even bother. You know what I mean? Or it's like, well, you know, we only work with premium stuff, so what's your budget like? That's. That's not sales, guys. That's. That's an interrogation. Yeah, you think you're saving yourself time, and you actually are, because what you're doing is scaring away perfectly good clients so you don't. You don't have to go do an estimate for them because you just scared them away. But that's not sales at all.

Yeah, I completely agree. And you need to invite these people into your ecosystem. You're the expert they're calling you. You know, have compassion and empathy and hopefully help them. So with the mindset and then getting your pricing right, and then sales and then the systems. When it comes to the systems, what does that look like? Does that mean like, you know, documenting all your processes, running EOS or something like that? Or what does this sound like or look like to actually. You got all this set up? How does it scale it?

Yeah, systems is funny. It's interesting rather, because I've never met two businesses that have the exact same systems. So, again, this is one of those things where I'm cautious when someone's, like, trying to sell them the system in a box, where it's like, here, get my system, and then run your whole business. I'm like, that's not. I don't see in any way how that would actually work. I'm a big systems guy. I'm a big tech nerd. I love technology softwares. I probably have way more software and automations than I actually need, but I love all that. So I've used and tested out five different project management softwares in my own business and stuff. And so the thing with systems is it's really more about documenting how you do things like your process and that is a system. So if I say, you know, this is how we hook up a trailer. You know, I got new, new people coming in. Like, this is how we hook up the trailer. We do this and we put the chains and we cross them, or don't cross them, or put the hooks backwards or forward, whatever it is that you want to want them to do. And. But the next iteration of that is I can take a video, I can just get a, you know, get a video and I can just talk to the video. It's a, it's a, you know, one minute video. It's like, here's how we hook up the trailer. We do this, this, this and this. This is how we expect it every time. Now I take that video and you can do things like create QR codes and stick a QR code on the trailer. So like you, you get a sticker of a QR code and stick it to the trailer tongue. And now when you got a new guy who hire and he's like, hey boss, how do we hook up a trailer? Or you say, go hook up a trailer. Well, how do you do it? Just go scan it. They take out their phone, they scan it, they watch a one minute video. It shows them exactly how to do it. Now I don't have to go out there and waste my time or my lead guys time to go out there and show them how to do that. Does it take a lot of time to create? Yes, it does. But if you think about it like, how long, you know, if I went out to hook up a trailer and I just had somebody with a camera, it may take me an extra couple minutes, right? Like literally a couple minutes. But now I never have to do that again. And so now that's in forever, you know, there and then every time you do something, you just document it. And then eventually over a period of time, you'll have a system in place that allows you to, to remove yourself from all of the daily, you know, what do we do next? What do we do next? You know, I got this problem. How do we solve it? What do we do next? And so really it's more about document documenting your daily activities than it is about having this crazy, you know, software and all those things that do everything for you.

Yeah, I think that systems are extremely hard in construction trades, home service, type of space, because there's so many variables that things pop up. And it's also like, well, my tech's out in the field and I'm on the phone with them and how do I document this, and your point exactly is like, the more that you can record and then turn into a QR code or even take that transcript and plug it to ChatGPT and get an SOP out of that or something that's streamlined, is better than nothing, and it can help you scale significantly to have like a basic handbook or something for people to use.

Here's what I'll tell you about systems, and I talk about this in the book, and that is you need to create a first rough draft. Now, I'm, I'm speaking to the craftsman out there, okay? Because I, I know how I. If you're listening to this, I know exactly what you're thinking. One of the most complex systems to fix in your business is the estimating system. Like, most guys I know hate doing estimates. It takes forever. You know, it's hours and hours. That's another reason why we don't do free estimates, by the way, because you can get paid for doing them. But you don't. You don't sit down. You don't, like, wake up on a Monday and be like, okay, today is the day I'm gonna fix. I'm gonna create a system for my estimating. That's not how it works. Like, you're going to have multiple iterations of this. You're going to do things. It's not going to work. You're going to change it. It's going to take a long time. So what we do is a first rough draft. It's just sit down and write down the top five things that you have to do in that thing. So let's say you're trying to create a system for putting up plastic and protection at a house. You're doing a bathroom remodel, and you're going to put up plastic walls and put out runners and all these different things that protect the client's house. Well, you don't sit down and, like, think about everything that you need to do. You just say, like, what's the main things here? Like, what's the top level? And then you go, okay, well, the first thing is, like, putting up plastic walls. Well, what needs. And then I go and I say, well, what needs to happen for us to do that? Well, we got to have poles or we got to have tape, or we got to have plastic. Okay, well, before we get there, how do we get the poles, the tape and the plastic? Well, it's got to be in the trailer. Okay? So now we got to make sure that we have them in the chat. Like, and so, like, it Starts revealing all these things. So let's say you have a rough draft and now you're ready to deploy it. You go out to the field, you say, guys, we're gonna, we're gonna use this new system I created. If we're putting up plastic and the first time you use it, it like, the guys are like, well, this doesn't work. You forgot to put on here, you know, this and this, or we need to add this. And so now you're putting it to the test, and then you're finding what doesn't work, and then you go back and you refine it, and then you do that again, and then you refine it and then you do it again, and eventually you'll have the perfect process for anybody who comes in. They'll know exactly how to put up plastic and, you know, dust protection and all that stuff. And then you'll never have to teach it again.

Yeah, I think that that is so critical to go through like soup to nuts. Start from the beginning. Work your way backwards. Figure out the things that you need. One big thing that we've been doing a lot lately and encouraging our clients is because, you know, a lot of people, they're not going to go on Word and try to type up this thing and put bullets and all this stuff. It's just like, get on a zoom or your phone and just record yourself as if a new person was to ask you, how do I do this? And then just tell them, and then take that transcript and put the ChatGPT. And then it's going to put all the bullet points and make it look nice for you. And you don't have to type it out or anything. You can just talk as if you were to talk to a new employee. It's a great way to streamline that entire process pretty quickly.

I love it. Yeah, there's. There's so much technology out now with, with AI ChatGPT and all that. You can definitely streamline this even more. I mean, you can just go on ChatGPT and be like, hey, give me a process for putting up plastic, and it'll get you 90% there.

Yeah, there you go. That's true.

You don't even have to do all that. Here's the other thing, too, is like, you don't have to be the one that creates all the systems and processes in your business. You can have your employees do it. I could have, if I have an office manager, and let's say one of her responsibilities is to put, you know, payments that we receive into QuickBooks. I could just go to my office manager and say, hey, Michelle, can you record, get on loom and just record the process that you do to put the check into the QuickBooks and record it?

Yeah.

And now I have a loom recording that I can just put into a database somewhere and be like, if I need to hire a new office manager or whatever, or place she's sick or whatever. Now I get to say, watch that video on here's how we do checks so it doesn't have to be me doing all that.

Yeah, really great point. Well, man, I could talk to you all day about different things. Yeah. So if someone feels stuck or they, you know, they're not at the profitability that they feel like they should be, or they're, they're not sure how to scale their business, I'm guessing from our conversation those are good people to reach out to you. Where should they go? What should they do? If they want to get this labor burden rate calculator, where do they go for that? What's the next steps on this?

Yeah, so the labor burden calculator, I do actually, I charge a little bit for that because it is quite involved. They can't get that on my website. They just go to hammerandgrind.com it is available there, but there's other ways you can get it too. If you're interested in my book, what you're talking about, the contractor profit blueprint, you can go to the website thecontractorprofitblueprint.com you can buy an ebook version or you can upgrade to a paper book. Paper book. And then there's some bonuses in there. There's also some other options where you can get the labor burden worksheet as well, but it's included in some of the things that are in there. And then what I, what I wanted to do for, for your listeners, Phil, is that we can do a coupon code where they can get the ebook for free. So the ebook, seven dollars. But I'll just give you a seven dollar coupon. You can get the book for free. And we'll just make it the, we can just make it flash as a, as the coupon code. P H L A S H. That's the coupon code. They use that and then they can get it for free.

Okay, sweet. Yeah, thank you. I think, I mean, if you listen to podcasts, you probably read books and you're interested in getting educated. So that would be a great first step. What about your coaching stuff? They can go through that process, go to your website and learn about coaching as well.

Yeah. You can do that. I don't have a ton of information. I know this sounds crazy. I don't have a ton of information on my website about the profit club or the one on one coaching that I do. And that's because I don't just let anyone in. I actually want to have a conversation with you first to make sure that I can even help you. And so I like that. You can schedule a call right from my website. You can just schedule a call with me and then we'll look at your business and I'll share with you, you know, which options are available, and then we can go from there.

Yeah. Cool, man. Well, it's been great chatting with you and look forward to keeping in touch and good stuff. Thank.

You.