Most Home Service Companies Die Here (So Did We…Almost) | Ep 90

Today I have something vulnerable to share about my company, Flash Consulting. And I'm sharing this because we work with one to $10 million home service businesses and our company too is in the one to $10 million range. And we're growing. And there are specifically five things that we're doing to grow. For example, last month we were up 96% in revenue year over year. And I wanted to share this because I've had some conversations with clients and prospects over the past couple months. And these five things seem to see these bottlenecks or these sticking points that I am facing as well. And I like to be transparent and share those things to hopefully help other home service businesses and business owners in general that are going from 1 to 10 million overcome those things. And here's exactly what we're doing. So the first thing is buying back my time. About 12 months ago I read the book from Dan Martell called Buy Back youk Time. And in the book he has this five rung replacement ladder. And I read it like four times and I was scared because now I need to start paying all this money to buy back my time. And I was looking at it the wrong way. I wasn't looking at it as, okay, I'm doing all these $10 tasks. I need to be focused on these hundred dollar tasks and I needed to hire all these people, train them, get them up and running. So about 12 months ago I hired a director of digital marketing for our company to run all the back end stuff. And I also hired an admin person to come in. So this five rung replacement ladder is this first rung is an admin person, which to be completely transparent, most businesses, and home service businesses in particular, skip this step. The admin person is someone who answers the phone, who follows up on invoices, who helps with all of the admin stuff that someone could do for $10 or $20 an hour. So an admin person, 12 months ago I hired that person to help me manage my email inbox. Manage our company email inbox, just in general, doing things that I knew that I should be doing as a business owner that were just falling through the cracks. The second rung is delivery. And usually home service businesses, they hire a technician or two. Maybe the owner is still out on the truck. Let's say you're like one to three million dollars. Usually you kind of have that flow of it and the technician piece is good. But there also needs to be another layer in there which for me, I was the director of digital marketing 12 months ago. Then I hired someone to run point on all the back end stuff. What I can tell you is that it freed me up so much to be able to go out and get new clients and build the brand and build more content and do podcasts and get more clients. And that's one of the reasons why we're up year over year, almost double. Because it freed me up to go focus on what I'm really good at. The third rung is marketing. And this is the piece that even me included I got stuck on because I'm a marketing guy. I have a marketing agency literally, so I know what to do when it comes to marketing. However, I don't have the time to execute the full on marketing strategy that I want to. So I had to actually go out and find a company to help me. Because B2B marketing is different than B2C marketing. We have the game plan for residential B2C home service businesses, but it's way different than B2B marketing, which is what we do. We go, you know, we're trying to work with other B2B partners. On top of that, the admin person that I hired was able to help me with a lot of the marketing tasks and I obviously do some of the marketing tasks as well because I really, really like it and I think it's one of my unique abilities. But marketing is a big piece, especially for home service businesses. They get stuck on this where the owner is the chief marketing officer, the one that has all the ideas and is trying to put all this stuff together and they're not looking at the data, they're not doing all things that they should be doing right. They're not doing the email newsletters every single month. They're not building automations and follow up sequences in their business. More importantly, they're not pulling return on ad spend reporting every single month. They're not tracking their keywords. Is this ranking, is it not? So there's a lot of things that go into digital marketing that most of the time home service businesses are spending on cookie cutter marketing. The fourth one, and this is a big part, the fourth rung is a salesperson. And for my company, literally a couple weeks ago we just hired our first salesperson and this is the 1 to 3 million dollar trap which is to get past 3 million you really need to get out of all of these seats. So the salesperson is so important because as a business owner I'm the best at sales because I literally started the thing from zero. I have the conviction I can speak to Other business owners, and I know exactly what they want to say, but in order to scale, I can't be bottlenecked. Like, what was happening was I literally only had, you know, one or two days a week, maybe a couple slots to book sales meetings. And people would email in like, hey, I want to meet with you guys, but you can't meet for another week or two. Like, what should I do? And we had all this lead flow coming in that wasn't getting followed up on. We're sending out estimates. Estimates weren't getting followed up on a propos. And this is exactly what happens with home service businesses. We actually had a electrical contractor that we worked with where he wanted to get more leads and ultimately more quotes to help grow his business. But he was the salesperson. What ended up happening was we doubled the number of quotes that he did. So not just leads, we doubled the number of quotes that he did in one month. The problem is he still closed the exact same amount. He went from 70 to 140 quotes year over year, but he still enclosed 30 of them. Why? Because you don't have the infrastructure to achieve the outcome. And a lot of times people get stuck here and the last rung is management. This kind of leads me to the second thing that I've been focusing on a lot, which is culture. When it comes to culture, our team is all remote. We have 14 team members all over the world. And the problem is I used to work at a home service business. I was in the trenches there 6:30am with, we had 28 technicians for CSRS. I was going to the CSRS, coaching them. You know, I was in the mix. And even before then I worked at Enterprise Rent a Car, running a local service business that was one to three million dollars. I was a branch manager. I was responsible for 20 team members. I was very good at building culture in belly to belly, person to person. This was completely different because we're all remote. So here's some of the things that we've done to build culture. First, of course, people say, you know, vision, mission, core values is all fufu. But I believe that core values is a part of our company. And when we're hiring people and also encouraging people to do things or holding people accountable, it's like, this is who we are. And if you're not doing this, then you're not a we. And Dave Ramsey says that a lot in entree leadership. If you're not doing this, then you're not a we, because this is who we are. And one thing that really helped me with this core values thing was before I would say, well, I want us to be like this. But now we've been in business six years, it's like, no, this is who we are. These are our core values. This what makes us different. It's not aspiring to do these things. It's. This is actually who we are and the values that we stand by. And I think that's a very important thing to preach down to the company now when it comes to culture with the remote team and even when we're. When. When I used to work at a home service business in person, this usually fell by the wayside and that was this one. Like every quarter you should be having some type of a team eventually. Even if that's like, hey, let's just order pizza for lunch or get donuts for breakfast and everyone come in and just kind of hang out. Maybe we have some games or something like that that we play, but something every single quarter where it gets everyone together, build some camaraderie that was missing at the home service business that I was working at, that I implemented immediately. Start building the relationship between our CSR team and the technicians. The second thing is having one to ones every single week. So, yeah, of course it sounds like a lot of. But one to ones every single week with goals allows for every single team member to come to you and say, hey, this is the issue that I'm having. I'm not saying you have to have one to ones with every single person. You should have some delegation. Usually I think the numbers around five to eight people is the max that someone can do one to ones with and actually manage fully, or you're the bottleneck. But having one to ones is huge. And then the last thing I would say is setting up goals. When it comes to culture, if you don't have like a North Star, like for us, it's client count. Every single person knows how many clients we have at any given time, because that's our number one metric that we look at as a business. Are we losing clients? Are we gaining clients? And what number are we at if you don't have that North Star number for your company? Whether that's jobs, booked, quotes, leads, revenue, whatever it is. Like what we did was for the csrs, we had a job count goal every single month. So we knew last year we did 500 jobs. This year, if we want to grow 10%, we need 550 jobs. So. So we put that in the CSR whiteboard then with the technicians, our North Star number was number of reviews. So we would say, hey, right now we have a thousand reviews. Our goal is to get to 1200 reviews. So let's get there. And basically these North Star numbers are what you want to focus on to help build this culture. The third thing that I've been doing, and I want to take a step back to those replacement, that replacement ladder is those rungs. So marketing and sales, specifically, to go from the 1 to $10 million jump, you have to get those things dialed in first. Your marketing system has to be dialed in. And it's not just like, oh, we need to hire this marketing company and they pump out all these leads. No, the number one thing you can do is dial in your return on ad spend reporting. So that way you know what's working and what's not working. So for example, if you're spending money on Google Ads, Yelp, meta, whatever other platform, you need to know every single month how much your return on ad spend is actually producing. So for us, we hired a company that does B2B YouTube ads that generates leads and they also pull a return on ad spend looking at the leads. And then every single month they go in and say, okay, spent this much, we got this many leads, this is the outcome that we receive. Now, if you are a home service business and you're spending money on ads and you have a company that's not inside of your CRM looking at your leads, pulling return on ads that are reporting, that's a problem you're not going to be able to scale. Good data, good decisions, that's what takes it to scale. And the other piece is the salesperson. So for me, I mentioned that I was the bottleneck for sales. I didn't have enough availability to do sales calls. I wasn't following up on all the leads, I wasn't following up on all the estimates. And things were kind of just falling to the wayside. And you know that if that's the case for your business, you're not going to grow. We run into this problem all the time with home service companies where business owners feel like, okay, I'll just get more leads and then I'll grow my business. But if you don't have the infrastructure, you can't get the outcome. And that's really the problem is that they are the number one salesperson. So if they go on vacation, sales stop. Which exactly the thing that happened to me, and that's why I'm solving this problem. And I would highly encourage you that if you're scaling your business you have to solve that problem. Okay, number four. And at this point, you might be like, okay, Phil, like, I get what you're saying, but how do I actually hire these people and remove me as the bottleneck, which is the exact thing that I face as well, because I had all this stuff in my mind. I hired this director of digital marketing. How do I get them up and running? I'm hiring this salesperson. How do I get them up and running? I hire this admin person. How do I get them up and running? And what I realized was, like, it's all, you know, read a book, you listen to a YouTube video, and it sounds so practical and easy to do. But each of these people, I would say it at least takes 6 to 12 months for them to get fully comfortable in the role, to get on board. And even at 12 months, there's still so much that they're learning. And when you're growing at 100% year over year, doubling revenue, there's a lot of moving parts and a lot of people coming on. And it's almost like you're just against time. It's not even about the people. It's about, how can I hire these people and get them up and running so I can hire the next person? Because you only have a certain amount of time that you're operating on. So how do I remove the bottlenecks? And how would I recommend for home service business to do? This is one. Dan Martell talks about this in the book, this one three one strategy, which is, there's a problem that one of your team members facing, and instead of them coming to you and giving them their monkey and saying, hey, what should I do with this boss? Hey, how should I handle this thing? What you do is you say, when you come to me, give me three solutions. So whatever those are, hey, we had this problem. Here's three things that I think we should do. Then you quickly discuss it. Then you say, okay, cool, I think we should do this one. And you're trying to refine their thinking process to start thinking like you. Then the next time that they come to you, they say, hey, I have this problem. Here's the three things. I think you're going to say this one. And then you might say, no, I'm actually going to pick this one. And here's why. Then the next time they say, hey, here's a problem, here's three things I think we should do. I think you're going to pick this one. You're like, yep, that's one that I would pick good job. Then the next time, they don't even come to you because they start to know what you're going to say and how you would solve that problem. And this is how you coach them and help alleviate the bottleneck from the business of you. The other piece of this is documenting processes. And in home service in particular, this is extremely difficult because the sales process, for example, is the one that I've been mentioning that most people get stuck on. The sales process is very unique. You know what to ask. You know how to overcome this objection. You know how to position your company as the authority. All of those things just come naturally because obviously you've been doing it for so long, people can look at you in the eyes and know you have the conviction that you can solve their problems. Now, what I would recommend and what we recommend for home service businesses is every single sales call that you do, take out your phone, start a voice memo on your phone to listen to your actual sales call that you're doing at the person's home or however you're doing it. And then when you're done with that sales call, take that voice memo and save it. One, it's going to allow you, when you do hire a salesperson, to have a ton of sales calls for them to listen to and to hear exactly what you're saying. Two, you can put it into ChatGPT and train it on an SOP. You could take the transcript from that recording, turn it, go to ChatGPT, say, turn this into an SOP. Now you have a basic SOP. If you have all these calls, you can also get all the frequently asked questions out of these sales calls. You can also use them for marketing. If you're like, hey, what are the common things that I overcome? And can I create content on this to send to these people beforehand? There's a million ways to utilize that specific asset of recordings. But the best way that you can do this, like the sales guy that we hired, all the sales calls are recorded. So all he has to do is just go back and watch all these sales calls and listen to them. We also have obviously an SOP that's been built off all these recordings. So removing the bottleneck is not hard. What you really need to do is start focusing on that now of getting all of your SOPS processes recorded and dialed in. And usually those are the bottlenecks, marketing and sales. SOPs and processes, because if you're going to start replacing those on the replacement ladder, you need to have SOPs and processes in place to give to these people. So that way you're not stuck on these things still. Okay. And the last thing that I've been doing is stress testing the business. Stress testing. What I've been doing is taking off time, specifically weeks that I know are going to be big issues like payroll time or billing time. Or we do these monthly reports where we go in and analyze all of our customers data, then literally hand write email reports of what we would recommend, what we're seeing. And sometimes people will say, hey, can you take a look at this one? Or what do you think about this? So I would purposely take off those times. So that way it's building the muscle inside of my business of resiliency. So instead of them asking me, they might ask one of their team members who also does a similar role to say, hey, can you look at this? Then they're going back and forth. This is stress testing the business on all levels. I'm off, A lead comes in, what happens? I I'm off. An invoice, doesn't get paid, what happens? These are all stress tests. And specifically to go from 1 to 10 million, this is what I found is that you have to start removing yourself from all of these seats and you have to build the team and the infrastructure to be able to support all these things. Because I was the one that was following up on unpaid invoices, I was the one that an email came in and I would be chiming in on different things. Right? That is not a scalable business. All you're doing is just running around doing random things that you can hire people to do these things and then focus on what your unique ability is. Which your unique ability might be sales, might be culture, might be coaching. But at the end of the day, when you look at scaling a business, that five rung replacement ladder is really what it's about. It's not about sitting in any of those seats. It's not about sitting in the admin seat, it's not about sitting in the delivery seat. It's not about marketing, sales or management. It's about building a business as if you're an investor and that's how you're really going to scale. You can still have unique ability. Like for me, I like marketing and sales. I'm still going to be involved in those things in my company because I'm good at it. But that doesn't mean that I have to hold those seats in the company only because what if I go on vacation, what if I'm sick? What if something happens that's not a sustainable business. I can still, though, go in and help with those things now with the stress test. There's a really good book on this called Clockwork by Mike Michalowicz. And the stress test that he says is you should be planning for a four week vacation and you should set that out in advance. And this was, I did this. And it's very scary for people. I didn't end up doing the whole four weeks, but I at least set a date out in front that said, okay, in this month, I'm going to be out for the whole month. So I need to start planning for that now. And it changed the way that I thought about my business because what was happening was I'll be like, okay, I'm doing this task right now, but when that month comes and I'm off, someone else has to do this task. So who's going to do it? And I started having to replace myself on all these things, or at least building processes for all these things so that other people could do them on my team. And that was a beautiful thing because it started getting rid of all these things and it gave me a reason to offload them. When you don't have a reason, you just kind of do them and get stuck in every day. And that's why I think that this book, Clockwork talks about set that four month, that four week vacation and then start getting your business to run like clockwork and start forcing yourself to look at what you're doing every day and replacing those tasks. One thing about the stress test, I to make sure that I have something planned to do when I'm off, I planned one stress test and I ended up working because I'm so passionate and have the conviction about what I do. And I love what I do that. It's like, I want to do this every single day. If I have nothing to do, I would much rather work on my business than watch TV or even go for a hike. I go for a hike, but it's like an hour or two. I just love what I do. I realized I need to plan things with my wife or my family to be able to sustain that time away. So that way I'm not just like sitting on the couch because that's not something that I would do. I would be doing stuff, working on the business. So this is some feedback of things that I found was like, if you're going to plan some time off the stress test, make sure that you have something to fill the time. All right, so this is a new style of video. I'm kind of sharing where I'm at again, we help home service businesses in 1 to 10 million fill that marketing gap, help their sales team and help them scale. And that's exactly this position that we're in as a business. So I like to be transparent and share this because people love to hear, you know, hey, what are you doing in your business? How can you help us? And then just from business to business side, like, here's exactly what we're seeing, and we're all fighting kind of the same battles, and this is how I'm fighting them. And hopefully it helps you. If you have any questions or thoughts, drop a comment below and I'll see you in the next video.