The Home Service Expert Podcast - Building an 8-figure Business Through the Franchise Model

Episode Date: December 16, 2022

Mike Andes is the Founder and CEO of Augusta Lawn Care, an eight-figure international lawn maintenance franchise. He also shares his knowledge in the field of marketing, brand awareness, sales, operations, and growth strategy planning through his Youtube channel and his podcast, The Mike Andes podcast. He is also an author who has already written three books, with his latest release titled P4P (Pay for Performance): Why Hourly is a Failing Formula. In this episode, we talked about sales, leadership, scalability, franchising, and growth strategy planning…

just being very clear and honest. And I've done better now about like, look, you're buying a system here that makes money. And it just so happens that I'm at the top of this and trying to lead the organization, but it has nothing to do with me. The systems work independently of Mike Andy's. They work independently of any person and a true system works independent of a personality. And most businesses are personality dependent instead of systems oriented. And every single time when something happens in the business and you have to step in, your strong personality will probably carry the business

for so long, but eventually that will fail. And that's why systems have to be put in place and supported as the company grows. Welcome to the Home Service Expert, where each week, Tommy chats with world-class entrepreneurs and experts in various fields, like marketing, sales, hiring, and leadership to find out what's really behind their success in business. Now, your host,

the home service millionaire, Tommy Mello. All right, welcome back to the Home Service Expert. I'm your host, Tommy Mello. Today, I have Mike Andes from Bellingham, Washington. He's an expert in sales marketing, brand awareness, operations, and growth strategy planning. He's done quite a lot of things. He's the Augusta Lawn Care founder, CEO, franchise developer from 2014 to present. A lot of companies here. Mike And's Enterprise LLC. He's an entrepreneur and an author. Anytime Fitness, Katosis Food LLC, and Andy's Lawn Care. So he's the founder of the international lawn maintenance franchise, Augusta Lawn Care, like I said. He's also co-owned a large lawn care business with his brother at the age of 12 and with the college

at the age of 13. You're going to have to talk about that. Mike considers himself to be an entrepreneur first and foremost. He considers running a business to be the best type of investment one can make to provide financial security for future generations. He is on a mission to impart his knowledge and assist others in building their personal wealth through his business bootcamp podcast, The Mike Andy Show. So tell me a little bit about your journey here. This is a pretty cool story. Talk to me a little bit about where you've been, where you're going. Yeah. So I thought I was going to become a doctor. That's why I started college so young and started mowing lawns when I was 11 years old with my brother to basically pay my way through.

And he became a teacher. I was thinking I would become a doctor, ideally a surgeon. And after my undergraduate degree, decided that that was not the path I wanted to take. And I did not want to be stuck in one specialty doing the same three or four procedures for the next 40 years of my career. So I decided to just take the lawn care thing that we had been doing, my brother and I, I bought them out and then started Augusta Lawn Care. I was 18 at the time.

I dropped out of medical school and started my MBA at night instead. And so got that my first couple of years. And at the same time, I started the media side of the business, which really just built around trying to help landscapers and lawn care professionals. Now we have 95 locations at the Gust of Lawn Care. We started franchising a couple of years back. And yeah, that's mostly what I do now. So this is interesting because I know a lot of companies want to grow.

Talk to me a little bit about the pros and cons, a little bit of a SWOT analysis with a franchise model. Yeah. So if someone's wanting to franchise their business and actually become a franchisor, let's take it from that perspective first. The first thing is you got to realize that the legal cost and the amount of infrastructure required is pretty significant. So I, along with probably every other franchisor that gets started, underestimate just how much it's going to cost, the capital investment, the amount of just barriers to get economies of scale. So in my opinion, you really can't be profitable and really have good enterprise value for a franchise unless you're doing 100 plus

locations. And so if you're going to do five, six, seven locations, this is not worth the franchise. I would much rather see a profitable model at five, 10 locations if you are doing corporately owned and you keep all the revenue in-house. So when we decided to do the franchise model, it wasn't so much a financial decision as much as this was a way to get the most impact in the industry. And by having a lot of locations, we can do that and actually move the needle for what we want to see in the industry. But from a financial perspective, I'd say for 98% of people, if you're willing to scale and grow, starting multiple locations or scaling up and make it just a massive one behemoth is probably more financially wise. Because if you're not confident in the first few years, you're going to be either able to raise millions of dollars or be able to start 100 locations.

I traditionally don't see a successful franchise or lasting that long. So that would be the hurdle, kind of the weakness, I would say, of the franchise model. And what's nice about a franchise though, usually there's a fee to get into it. Yeah. And as a franchise or your biggest barrier to growth many times is capital. So capital expansion with a franchise, you're basically tapping into the franchisee who funds the growth by buying the trucks and the assets that would otherwise take a lot of time. So you can scale it much faster. So scalability, the capital intensiveness of actual buying assets like trucks and equipment is much better of a model when it comes to franchising. I've read a lot of books on franchising,

and I think it's a great play. But what I tend to see with a franchise is a lot of these franchises, they don't have a great CRM. They don't have a great price book. They don't do the marketing. They don't have a plan for how to optimize GMBs. They don't have a review generation opportunity. They say, listen, you're going to buy from us. They might have a couple manuals. It's so weird to see the disparity of really the best franchise in the company, franchisee, and the bottom one. But then there's other franchises that do really well. If you buy a McDonald's, you got to go work there and you got to have at least you're well-funded. There's a lot of things that happen to make sure the franchisee is successful at McDonald's. Talk to me a little bit about what your thoughts are on what you would need.

And not everybody's sitting here thinking they're going to franchise, but I just want to know from your perspective what you thought. Yeah. Ultimately, if you're going to franchise a business, you've really got to have a business that can easily do 17% to 20% profit margin. If you're running a business model that's doing 10, 15%, it's going to be very hard to ever be able to actually get franchise fees from someone and then still run a profitable business. So it has to be a sustainable from a profitability standpoint, if you think franchising is what you want to get into. And like you said, most people probably are not thinking about franchising their business. But when you look at that model, that's definitely the key ingredient.

The next thing is you got to look at the fees that you're charging and ask yourself, is this actually worth it? Because the alternative is to that money be spent on software or marketing and just go get more customers. So if there's not actual benefit, for example, you use McDonald's. The reason they're so successful is as soon as you become a franchisee, you tap into a distribution network for food that is unparalleled and the cost of distribution is so much lower compared to basically any other restaurant. The supply change is incredible. And so what are the benefits of joining the franchise have to be balanced out? What are the fees? And I think the biggest mistake that a lot of home improvement franchisors have made is using a royalty model because what's different

compared to tech or other industries is as we grow in scale and massive size, we don't get the same type of economies of scale as you would in say software, where you build it once and you can replicate it a thousand times. When it comes to home services, you got to buy more trucks, more equipment, more people. It doesn't scale the same way. So what happens a lot of times in a lot of these franchises that are in the home improvement industry is the best franchisees actually get penalized because they're paying eight, nine, 10% into a marketing fund and all these tech fund and their royalties. And now it's like, why would I keep growing my business when 10% is coming off the top? So that's in part why we just tried to flat monthly $1,200 per month. And it doesn't matter

if someone's doing $2 million in annual revenue or they're just getting started, it's the same amount. And so that's one thing we've done just to kind of make sure it's very much based upon the meritocracy of the owner and not simply keep growing and get more sales because we get a cut of all of that. So what is the average franchisee after, I don't know, what do you think the grace period is to really get their bearings? What are they doing in the lawn care industry? Yeah. For us, I tell people, look, if you're not going to grow above $20,000, $30,000 a month in revenue, there's no reason to join our franchise. You don't need to join. There's plenty of work to be done.

Just throw an ad up on Craigslist, throw a half decent website, put a GMB, like you said, up, get some reviews. You don't need a franchise. The only reason you join the franchise or any franchise is to scale it, right? So multiple locations, being able to tap into the systems that work across different states and be able to do multiple locations with GMs and be able to send them to training and not have to worry about the backend infrastructure. So that's like the only way I'd ever join a franchise.

And I came from Anytime Fitness and I bought that franchise prior to starting Augusta simply to learn how they did training and what the benefits of franchising were. And I wanted to learn that as a franchisee. And now looking back on the gym industry, I can't even imagine trying to start an independent gym now without the franchise. Having their back and support, knowing exactly what pricing is going to be, having 4,000 other franchisees at Anytime Fitness that have tested models, know what works, knows what doesn't work. There's no more guessing. And I might say myself years of trying to figure those things out otherwise. And so that's definitely an advantage, that community of knowing what works and what doesn't inside of the model.

Tell us about some of the struggles you had when you were starting a business and how you overcame them. So I was starting Augusta, one location. We hadn't even thought about franchising a whole lot. And it was August 4th, 2016, which so happens to be the day my book got published, my first one. So I was underneath the dump truck. The PTO on the dump truck had broken. The PTO is the power takeoff. It basically is what powers the dump part of the vehicle.

And I was still in the business, right? I was going to this job to show the crew the work that they needed to get done. And I was going to deliver the materials and then drive the dump truck back to the shop. The PTO had broke the lever inside this old 1992 L7000 Ford dump truck, massive dump truck, and went underneath and was doing the manual engagement using the lever. And in doing so, the PTO caught my hoodie. And so that basically, the thing that spins underneath the dump truck, it caught my hoodie, basically tried to suck me into this PTO, ended up having to go to the hospital.

Fortunately, it just ripped down the center, my hoodie, and I fell out. But they take me to the hospital. I was a couple of weeks out just recovering. And in that moment, just realizing that you have to have systems, procedures, and great people in a business for it to run without the owner.

And fortunately at the time, I had some incredible people and we were relatively small still at the time, probably just under a million in revenue but it was still a matter of really coming to grips with the fact that the business had to run on systems and not because I was there working 14 16 hours a day and that was a wake-up call and that was the moment we started documenting what it'd be through the podcast and things like that what the systems were what type of things I had to put in place for the business to run without me as the owner. Well, it's like the Michael Gerber book.

E-Myth. The E-Myth, yeah, revisited it. I had him actually in this office. And I met Al Levy and I learned how important an org chart, a business plan. Alan Rohr taught me all about setting a budget and the financial quick check. And then we started to put the nice plan together. And every time there's an issue, it seems like 5 million, 10 million, 20 million, 50 million, 100 million, you kind of got to rebuild and make better and better systems. They need to get better and better. And I know I'm going to hit another one at 500 million, but it's not like they just need to be completely... One of the pieces of advice

I'd give people is pretend like you are a billion dollar company. Get the systems today rather than saying, oh, I'm just going to switch this out because it's so much harder to switch when you get big. What are your thoughts on just some of the systems you've had to build out to be able to handle that many franchisees? In terms of the franchisee side is you're building a support network on the backend and you're trying to create systems for specific scenarios that happen for a business owner, right? So from a franchisor perspective, us creating systems, again, we are a few years into this. I'm not going to pretend like we are figured it all out. We only have a hundred locations, which isatively small in the grand scheme of things. But the biggest thing is, okay, you have 100 different owners, 100 different personalities, 100 different family backgrounds,

business dynamics, business experience, financial circumstances. How do we figure out what all their choke points are and then at each choke point, create a system. So for example, when someone has massive amounts of work coming in, but they're running out of cash, what's the system for that, right? We have a six week plan. Here's step one, here's step two, you got to work through these six weeks. And on the other side, you're gonna have a more profitable business, you're gonna have cut out services and cut out certain customers that you don't want. Like there's a system for that. And I think every time you look at a system, I just simply think of it like a dam, you've built up this thing that's creating all this pressure. And the system is the thing that goes around the dam and allows pressure to be released.

And if you don't have those, eventually the dam will give out. And we can have a strong personality as an entrepreneur and be super strong in our business and work crazy hours and be super type A driven. But eventually that dam gives out. And that sometimes happens when people get divorced. That happens when people get sick. That happens when a customer doesn't pay their invoice and now you're behind on your bills. That dam will eventually break if there's not systems in place to release that pressure that when there are struggles in the company, there is a system to follow. There is something that you do. What happens when five guys walk off the job and you only have seven employees? What's the system you're going to use to onboard five people in the next 24 hours?

Those are the type of things that have to be figured out. And that's what we've had to work on as a franchisor when it comes to creating systems. Systems at the operational level is a whole other can of worms. But from a franchisor perspective, that's still something that we work very hard on. So it is hard to hire right now. I mean, I keep every podcast seems like we go into this hiring and I think great recruiting is great marketing for the most part. What do you guys do? How do you pay? How do you guys stay competitive when everybody, I mean, we added a 401k,

we've got dental, we've got plenty of PTO. The guys get a brand new truck. I mean, we had to get our guys to six figures and figure out how to do that to be able to attract them. So what do you guys do when it comes to hiring, especially if it's a greenfield, just new market? Yeah. There's two things that we really focus on. One is upper mobility. And then two is compensation, what we call P for P, pay for performance. And so when it comes to upper mobility, we tell them when they first start, we don't want them to be mowing lawns within two years, right? Three years max. And the goal in that is you got to be here and learning and educating yourself using the systems and the stuff that we offer and become a general manager,

become an estimator, go start your own location. We have what we call the 3F program, franchise fee forgiveness program. They don't have to pay their franchise fee if they've worked at a location for two years. So it gives them the opportunity to actually learn the business and then go start their own. And we have a lot of people using that model, employees inside the company. But then also, that's the first part is up from ability. The second part is pay for performance. And this is where I think every home improvement industry needs to go. And that is give the employee a percentage of their labor revenue that they earn for the business every single day, not a quarterly bonus,

not an annual bonus, not a benefit at the end of the year, but simply a percentage of the labor revenue they earn for the business every day. So we've created software around doing that, p4psoftware.com, but it's just simply a matter of how do I get compensation as close to the performance as possible? And ultimately we talk about referrals and reviews from customers that, Hey, everyone in these industries, the employees are talking to each other and they know that, Oh, this is the company that pays the most. This is the company that is able to afford the best benefits. This is the company that has the best trucks. We don't have the best trucks. We don't have the best equipment, but I can guarantee you we're paying right now at our local shop, probably at least $5 to $8 more per hour

because of P4P. They know that when they come to work, they're going to be working with other coworkers. They're all busting their butt trying to make more money. And one of the most demotivating things to an A player is they have to work with a bunch of C players all day long. That's on their phone, dilly-dallying, stopping at every single gas station for 48 smoke breaks. They don't want to work with those people. And on a system like pay for performance, those type of people don't last long. They get snuffed out. And so those are the two things we really focus on is uproom ability, getting them out of the entry level position as fast as possible, giving them the skills and the tools to do so. And secondarily is actually paying them. If you're a 19 year old and you're willing to come

hustle, get to work early and have a plan in place and execute, I want you to make more than the guy who's been around for 15 years and is now just lazy and dinks around all day long in their truck on their phone all day long and takes a siesta for three hours in the middle of the day. You shouldn't be able to make more from day one. It's not fair that someone just because of their status or because they know the boss or they've worked there for 15 years makes more than the guy who's actually making the company all of the profit. And so that's really the things we have done to try to retain. Obviously, it's difficult still, but people talk, employees talk to other employees and trying to retain it and attract that talent is important.

You make a great point. I don't believe in tenure whatsoever. When I got my master's degree, I hated the instructors that couldn't get fired and they never did anything in their life. They never were successful. When we switched to pay for performance on everything, now our dispatchers, our CSRs, our technicians, our installers, and we coordinated this because what I find is most companies, the dispatchers hate the techs, the technicians hate the CSRs, and they don't work in a harmony because one is they got different goals. So if you work on the pay structures to where they're motivated by the same things and they're all rolling in the same direction, you could be a lot more successful and you don't get

those bickering moments all the time that I see other companies having. So what do you tell a guy that's like, you know, I've been doing this 30 years. My guys make hourly. Obviously, the guys that have been doing it longer, that are faster, get paid more, you know, it's a different mindset. What do you tell somebody out there that's listening? Well, the thing is like, since I implemented P4P for the field crew, I have yet to ever have someone asked me for a raise. Whereas the six months leading up to implementing pay for performance for our field crew, I had at least three or four people ask me for a raise back when I was running one location. And ultimately, the reason is because if someone came and asked me for a raise right now, I would

simply show them our leaderboard and show them other employees that are making significantly more and say, you should go talk to them. They could probably teach you how to plan your day, make sure you have a lunch that's packed, be more efficient on the job site, be able to pack your tools and your truck and your equipment better. So there's always ways to improve. And whether or not you incentivize your employees is really up to you to figure out those efficiencies. They're the ones hands on the deck, boots on the ground that can figure out these ways to be more efficient and profitable in the business. Not you in some ivory tower, like, hey, this is what's going to work better. They're the ones that can figure this stuff out. You just got to incentivize it. Ultimately,

when it comes to hourly, think about it from this perspective. And that is, I'm going to pay someone more the longer the job takes if I'm paying them hourly. Whereas I, as the owner, get paid more and make more profit the shorter the job takes. So we're going in opposite directions here. Whereas when it comes to P4P, it's like, okay, I want the job done faster so I can make more money as a business owner. You're going to make more money if you get this done faster. So P4P just is like a no brainer. Once you do it, you literally, I can't fathom running a business without it and not having to micromanage the employees or track their trucks, worry where they're at. It's like, look, if you want to work harder, make more money, the opportunity is there. If you don't, if you want to be on TikTok all day,

great. You're going to make base pay all day long and you'll probably end up getting kicked off the team because no one wants to work with you. So that's really the model. Let the system do the hiring and the firing and let the system be the policing of the behavior, not you micromanaging all your employees and tracking them and rolling up on them in the middle of a job to see if they're working. Well, what's in it for me? What's in it for me is the question you need to ask from an employee perspective is show me how I can win the game. And I think that that's so important. Let's talk a little bit about where are you marketing right now to find great labor? I mean, do they just all come to you? Is it through Indeed, Facebook, TikTok? Is it through Craigslist? Where are you getting the most employees right now? I would say across our system, Indeed is probably pulling the most candidates in terms of optimizing. That's important, making sure you stay on top of it. You can decline those applicants within the 72 hours or whatever, so you can reduce your costs. Indeed is definitely the one in terms of paid. But again, going back to what we always talk about

in terms of creating a profitable business and having customers that come to you because of referrals. Again, the best way to do this is have a program inside your company that are bringing other employees and applicants to the business. So if you can send, I'd rather pay $500 to an employee to give me another applicant than $500 to Mark Zuckerberg or, you know, the Google boys to throw up ads for me. Right. So why would I not incentivize and give a bonus structure around bringing someone for 90 days into the company?

Yeah, I give $1,500 because that's right around what we pay per good hire. So I'd rather give that to our people. And the goal is to get a 60% referrals. We're not quite there yet. We're about 50-50. 60% of our hire is to be referrals. And here's one thing I can tell you, Mike, is a lot of people don't realize you can't just say, go out there and ask your friends. They need a process system to become good recruiters. And they need to know what to post and who to call and how to ask their friends and how to really find the right people that they're looking for. I thought I could just tell them at every meeting,

go out there and recruit and they would do it. But I realized I give an eight-step sales process. It's a customer satisfaction process. I never built a process for recruiting. So that's been the top thing I've been working on is, I mean, our classes right now, we have 51 technicians training next door and our next class will be bigger than that.

And I got to tell you, that's a big amount of hires because 50 techs also need managers. We need more virtual product specialists. We need more CSRs and more dispatchers. So we probably hired 80 people. Right. And I'm having a lot of fun with it. I will say landscaping is very seasonal. What do you do in the slow times?

We've really focused on, obviously there's some places where they use snow and it's a pretty clear cut and dry. We switch from mowing to snow as soon as the snow flies. But for most parts of the country, it's not that clear cut. And so what we focus on is what we call winter services. And we try to keep that customer that is on say weekly or bi-weekly schedule on that same schedule at the same price throughout the winter months. And we simply tell them, look, we're switching from mowing to winter services. It's going to cost the same amount. We're going to spend the same amount of time on the property. We're going to do this list of services. And people love it because it's like, they don't have to get multiple cleanups throughout the year, like fall and spring,

because we're going to come to their property every week, every two weeks, clean up their leaves, pull their weeds, edge their beds, check their gutters to make sure they're not clogged up, pick up any branches that fall down in a windstorm. So we have a whole list of things that we do. And we simply just spend the same amount of time that we would otherwise mowing their lawn, doing those other services. And people love it. We have like 50 to 70% conversion of mowing customers into winter services, that higher lend 70, 80% being new customers. If you're trying to convert your existing customers into winter services, it's typically more on 40%, 50%. But that's something that we really try to focus on to keep that recurring revenue throughout the winter

months. What has been a couple of obstacles that you've had going through this scalability? Have you had any morale issues? Any franchisees just complain because they're not successful? What do you think some of the things you've had to overcome over these last couple of years? Yeah, I think at an operational level, you kind of go through physical stress when you're first getting the business off the ground. You go through financial stress as you're in that middle zone trying to scale it up and you start having overhead like office workers, et cetera. The third part is psychological. You've got a bunch of employees and it's more about just like the pressure of

having all these people depending on you. From a franchise perspective, like there's always going to be people that can't succeed in business. And whether or not we want to play this like a game, it'd be like, if I threw a hundred people or a thousand people to go play a game of basketball, guess what? There's gonna to be some real losers. People like me that are like 5'5", and will never be able to get a basketball in their life. So me saying like, oh, just coach them up. Keep shooting free shots.

No, you're never going to be in the NBA. And so when you take a large amount of franchisees and you throw them into business ownership, there's a level of skill, and then there's a level of talent that is in the game of business. There's a lot of money to be made in calling business and entrepreneurship, a skill that you can develop and refine and make better. And there's definitely a piece of that, but there's a piece of it you can't, and that is talent. And I've learned that there's always going to be a small percentage of franchisees or business owners in general that just don't have it. They do not have the ability to sell. They do not have the ability to lead other people. And that stinks. Like I hate the fact that we have a few percentage points. Like now it's like 4% failure rate. I hate

that. But when I objectively stand back and step back from the emotional part, which I hate every single one that has ever closed. And the fact that like we failed somebody and we failed our system. I take that aside. I look at, okay, what are the actual numbers of failure rate without a franchise? And those numbers are a whole lot larger. So that makes me feel somewhat better. But anything above 0% failure rate for me is like, we have to keep improving and making these systems better because there's a percentage of that is that is their talent deficit.

But there's also a percentage of that is like, I did something wrong. Our systems failed somewhere and we have to make it better. You know, the question I would have is what kind of qualifying do you do? Have you ever denied a franchisee? If they've got the money, they seem excited, but their EQ or IQ might just not support the business. How do you even, do you take any personality profiling or look at their anything before you let them buy one? That is the challenge, right? Because here's the thing in the perfect world, everyone that joined a franchise, they have a lot of money.

They have a lot of experience. And those are the people that would join. Those are the people that have a 0% failure rate so far in the past few years of Augusta. Like those are the ones that do really well. Those are also the ones by by the way, that join McDonald's, Taco Bell, and all the rest of it. So when they have these great percentage of success rate of 88, 90%, got to keep in mind, you're talking about sophisticated investors and entrepreneurs at this point that are divested, have plenty of money to get through low times. So I got to balance that out with the fact that I also want to give my 18 year old self the shot. And that's the unique thing about home improvement and home services is the

fact that you can make something out of nothing. And I don't want to turn franchisees away. That might be a little bit tight on money, might not have all the experience, but that was me at 18. That was me coming out of a college situation where I was going to become the next Doogie Hauser young doctor. And now I was like, I'm going to go with Mo Lons. Well, I didn't have 50,000. I didn't have 100,000. That's the unique thing about this industry and why podcasts like yours are so important is to give the person that doesn't have anything a chance. And so those are the ones that are going to have a higher failure rate, but it's also the people I'm most passionate about, about building Augusta for giving them the

system to actually grow the company and do something. One of the things that I say is, listen, you want to go start your own garage or company, go ahead. But ultimately, if you don't love payroll, you don't love figuring out taxes, you hate recruiting, why not just literally come here, do what you love, put your work jacket up, take real vacations where you're not glued to your phone and make six figures and also get all the benefits. Like I literally had to build a sheet of paper and say what I work for me. And I put down all the things I would need to become. And I think it's so important that you go above and beyond and you slowly learn to become who you'd want to work for. And is that something that you feel pretty strong about? I mean, obviously, they're working for the franchisee, but you're involved with the franchise or as an employee.

So what does that look like? In terms of the relationship between the franchisee and the franchise or? Yeah, I'm just curious. And do you feel like most employees are genuinely happy? Working for us at the franchise level or the employees of the franchise i guess i don't know how much interaction you have with the employees yeah so like the franchisees employees have some connection to the actual system what we call augustination right so i will actually do like webinars specifically for the employees of the franchisees about like basics in personal finance and leadership and like basic stuff like that, trying to bring them into the culture of what we stand for. And like that is constant improvement.

Listen to audio books, like you're mowing lawns all day long. Why would you not put headphones on and listen to a good audio book or podcast and learn from really smart people? So we really try to push that to the frontline staff at the franchisee level. At the franchisor level, when you take a seasonal business like lawn care, landscaping, I imagine to some extent, something like the garage door industry is somewhat seasonal, but there's a massive, massive spring rush. And that is when all of our franchisees are under stress. That's when they're all growing and doubling and tripling in revenue. That's when they're all hiring new people. That's when they're all going through issues and stress in their family life and financially and all the rest of it.

So all of that compounds at the franchisor level. And that's the hardest challenge for me from a cultural standpoint is every issue across 100 entrepreneurs and 100 businesses, those become where every single day there is massive fires. Like every single day there is someone's life altering accident. Someone's going through on a hospital bed. Like that's happening every single day. And that's very jarring for a culture that is built to basically support all of those owners. And so that's something that like I had to get through psychologically.

Like every single day I'm dealing with people that are sick, people that had five employees walk off the job, someone who their spouse just left, someone who just got locked up in jail because they got a little excited on the weekend. Like these are the type of things that every single day happen. And now when you bring in franchisor support team,

that is a tough job. Every single day coming to that and dealing with the basic fire of business ownership across all these companies. So what I've heard from a lot of franchises, you know, Mosquito Joe's, and I know they sold the neighborly is when you get into a franchise, you're no longer in lawn care or garage doors. Now you're in the people business and you're dealing with owners

that expected a turnkey business. They wanted you to do all the work and you set up the systems, but they still need somebody on the boots on the ground to do it. And I think there's a misconception. I mean, that's gotta be a lot of stress for you. It is. And like, I'm not going to say, and like, I've perfected this. Cause like every single day, like I lose sleep more over our franchisees and like my own personal issues. And we, we were trying to grow a company and we have, you know, obviously we're trying to build a headquarters and there's a lot of stuff we're trying to do. So there's plenty of stress there, but like, I don't lose sleep over that half as much as I know franchisees that...

These are real situations. People in jail because of stuff. And we're trying to run their business for them from our command center. Real issues like people didn't have insurance on one of their trucks because they just bought it. And then they plow into someone and they get injured. That happens. And so when you know someone's on the brink personally or

financially in their business, that affects me just as much as if it was literally my own thing. And that is definitely correct. You're in the people business. It is a psychological and emotional rollercoaster and you get all the dirty laundry and garbage. And like you said, there are people that they don't have the goods and they're expecting a cookie cutter. I want to pay $20,000 and I want you to deliver a million dollar company to me in two years. As if there's no process in between that. And so that is challenging. I think part of it is setting the expectations. So I make a video every single day. And so the people that join have seen my life typically for quite a while. And I'm very open and honest. This is not easy. If you want to join Augusta and think you're just going to buy a location, put $50,000 into an

entry-level franchise, a very, very low-cost franchise and build a million-dollar business, and nothing of your effort is going to go into the next two years, don't expect that. That's not what this is. This is going to be the worst three years of your life if you're going to scale to a million in the first few years. It's going to be the worst years of your life if you expect this to be like, I don't want to invest any money into this. I'm going to live vacation all the time. My employees will do all the work. The franchise will take care of all the backend. If that's your expectation, that's the person we were trying to weed out because they're setting themselves up for failure and the franchise for failure. And it's not easy. Entrepreneurship's not easy. Having the systems to scale is why you join a franchise.

Outside of that, it's still going to be difficult. It's still going to be hard. But having a rallying point with other owners that are all using the same system, there's absolutely benefit in that because everyone's using the same model. Everyone's using the same pricing. Everyone's using the same marketing.

So it's easier to iterate on a system because you're all in the same boat versus a Facebook group in your industry where everyone's using different pricing methods and ways of paying people and their marketing is all different. Their branding is all different. And so having iterations of the same thing is what allows a franchise to get an edge typically in an industry. Every time I hear about something going bad, like that insurance deal, I write that stuff down and put it into an SLP, standard operating procedure, that that will never happen to anybody again.

And making sure that they follow step by step, that a 10-year-old can follow the steps. And it's these little things that people just, they miss out on. And I think about some of the mistakes. When I was landscaping, I was cutting a bush and I cut it up. It was an air conditioning line and I lost all the R2 or R22, whatever it was. Or, you know, I'm weed whacking and a rock hit a window and broke. Like, stuff's going to happen. But it's making sure you get the right tools.

Like, now we buy our guys all the right tools so that they're the safe tools we've got so when al levy started with me five years ago he noticed that 10 guys that he rode with the 10 things differently and so we had to come up with exact the same vans and trucks so the vans are for service the trucks are for install they carry the exact same tools they got the same uniforms that they do things exactly the same because they're taught the same and now i can replicate this process in any market personally i must have been asked a dozen times now to consider franchising and i'm like why would i franchise at this point it doesn't even make sense but i think the franchise model works amazing and that's what he talks about, Michael Gerber and the e-myth is he calls it the franchise

model because it has to have systems. You know, KFC opens a new store every eight hours. Think about all their systems of getting the right construction done, making it look a certain way, making sure they're hiring properly. What do you think the toughest thing that business owners make? What's the toughest advice that you could give somebody the first few years? I think the first thing is

getting past 500,000. Like for someone like yourself, franchising is definitely the wrong thing to move because like you could sneeze tomorrow and you make a million or lose a million in terms of revenue in the business.

Whereas a million dollar business to someone else that's just going to start a franchisee is a big deal, right? And so now you're dealing with either A, it's a sneeze or B, it's a big deal. And you don't want a hundred big deals, right? You just want to focus on growing and scaling what you got. It's working really well.

I think the biggest thing for people getting started, like for some people, a lot of people listening, a $500,000 annual revenue business is a big deal. And so to get there, it's simply sales. Like whether it be listening to you or the many of the people you've mentioned on the podcast already about these are individuals that know sales and marketing and how to get more customers and how to talk to people and how to close a deal. That is the number one thing to get past 500,000 in revenue, in my opinion. Like you don't need a lot of skills besides selling. And I've seen plenty of

really, really horrible operators, even in a franchise model. But if they can sell, and they know how to sell ice to an Eskimo, they just crush it past 500,000 almost instantly. Then it transitions to the next hardest thing, which is, can you lead? Can you put people in position? Can you create SOPs? Can you do onboarding? Can you hire? Can you actually be a good leader where people want to work for you? That's the next level, which gets people past a million typically. And then beyond that, just every single stage of, like you said, 10, 50, 100 million, it is another levels of leadership and organizational efficiencies. But that first two steps, the 500,000, a million is simply sales and leadership in my opinion. And that's what most entrepreneurs never even get past, those two levels.

And a lot of it has to do with just not being self-aware enough to realize where the deficiencies are and realizing either, A, they need to work on themselves, or B, they need to hire out that position because they're deficient in it. Yeah, absolutely. I love to hire for my weaknesses. I think the biggest thing I could tell myself 10 years ago is, dude, you could sell, you're a great marketer, you can make the phone ring off the hook, but you need to get a great, and I say great, CFO and controller. Because they tell you when to grow. They're doing things behind the scenes that are growing the business, like negotiating merchant fees and reconciliation and getting better credit cards with more points, more cash back, and just really building systems on the back end that most people don't think about to keep the money you're making. I see this all the

time. When I see businesses making single digit bottom line, I'm like, there's a problem. You shouldn't be scaling right now. You should be making more from the customers you earn already. I mean, I just had a meeting earlier with our VP of marketing and I said, we need to get down three more percent on the marketing per month. And I said, the way is not necessarily to cut the percentages. I said, we're going to set four meetings. Let's meet with this team, this team, this team, because that'll increase revenue, conversion rate, average ticket, and we'll lower the cost per acquisition. And those things matter. I mean, one of the biggest mistakes I see is people try to cut marketing first. And it's the worst thing you could do. It's fixed the system. Where's the money going? Can you renegotiate your lease?

Like there's so many opportunities out there. There's grants out there. There's a lot of things out there. The PPP money, there's things that we're working on right now, getting tons and tons of money back. And a lot of people didn't do these things, but if you can go back 10 years or five years and you could say to yourself a couple of life lessons in business, what would those be? I think one of my regrets when it came to franchising, and I've said this before, is at the very beginning, as is I think with a lot of franchises, when they first getting started, if they're founder led, people are joining because of the founder, right? They're joining because of the personality of whether they follow the content. They like that person, et cetera. When ultimately what you're

selling is not a personality, what you're selling is a business system. And so my first 10 to 50 franchisees, a lot of them knew me very personally. There's a lot of direct communication with me before they joined and they were joining because of me, not because this was a great model that they can make good money on and it's going to beat out the market. And so I think that was my first failure and just being very clear and honest. And I've done better now about like, look, you're buying a system here that makes money. And it just so happens that I'm at the top of this and trying to lead the organization, but it has nothing to do with me. The systems work independently of Mike Andy's. They work independently of any person and a true system works independent of

a personality. And most businesses are personality dependent instead of systems oriented. And every single time when something happens in the business and you have to step in, your strong personality will probably carry the business for so long, but eventually that will fail. And that's why systems have to be put in place and supported as the company grows you're constantly adding those systems and even for yourself like you know create you know having a cfo and a controller like what size business was that like 20 million 25 million well i will say i did have these people beforehand they were advanced bookkeepers but i had no idea until my last CFO here, eight years in private equity, knows how to do things that I never thought possible and really make sure that the bottom line is right. I'm great at the top line.

He's really good at the bottom line. And I think that's something that every company needs from day one, because here's the deal. A good guy won't let you go out and buy a vacation house and a Porsche and they won't let you blow. I find that a lot of the successful people, once they start hitting a little bit of success where they should put it in the bank and reinvest in growth. And it's careful. Don't say you're reinvesting all the money because you're making zero. Say you're making profit that's making it into the bank and then reinvesting in it. It's different because a lot of people that make no money say I reinvested it all. But I think that it's important to understand that the business gave you this opportunities. So reinvest it because you had to invest sweat equity in the

beginning. So now you've got real money to really jumpstart your growth. You can buy new trucks. You can give your people a little bit more, make it a little bit cooler place to work, have some really cool stuff at the shop. Like a lot of people ask if we got new trucks. It's a big hiring factor. They ask, do you get paid weekly or biweekly? Healthcare doesn't come up. 401k doesn't come up as much as you would think, but it's not something we carry. What are your thoughts on that? What are people looking for right now? Because my buddy Jody with RapidHire, he pulls on some clients and he's like, they pay $16 an hour.

They look like crap on Indeed. They don't have any benefits. They've got old, old trucks. And he's like, I can't really help them. He's like, I feel bad because I want to work with them, but I can't get anybody to apply. Yeah, like whether it be an existing employee

asking for like a new truck, new equipment, or an applicant asking about those things, we're really open and honest. Like, and I already said it in the podcast, like we don't have the nicest trucks. We don't have brand new things. Like if they're 10 years old, I'm fine with that. And part of that is because

if it's an existing employee that's asking about that, we have open book management. We show all of our numbers and we will show them, oh, look, there's no debt service here. And that money is basically what is going into everyone else's pockets in the form of profit sharing. So either A, we get new trucks or B, that's going to cost all of us in the form of profit sharing X amount per month. Which one do you want? And I've yet to have a consensus of all the employees being like, yes, we'd rather have new trucks than an extra $8, $9 per hour compared to the other industry in our

area, other competitors, and profit sharing wiped out. They would rather have the money. And so cash talks, I'm a big believer right now, especially in entry level, they're looking at that dollar per hour figure. They're looking at what's the average wage per employee. And we are boosting that as much as possible. We have health benefits and things like that. But to your point, entry level, especially labor positions, the lower the paying job, typically the less likely it is they're going to worry about healthcare, mostly due to the fact that they're getting a handout anyways if they're making under a certain amount. If you're making under $20 an hour in America, there's a very good chance you have healthcare covered someplace by

the government. And so why would I stress out about trying to offer this great healthcare package when that's not what your employees want? And so being keenly aware of what they want is important. If you're talking about general managers, people making 90, 100 grand, people that are doing sales and marketing, they're probably going to be looking at 401ks and healthcare. But if you're entry level, 15, $16 an hour guy, they're probably going to leave their current position and come for your position if you can offer 22. So how do you optimize the business for that. That's where P4P, pay for performance, come into play. It's like, can I pay them eight, $9 more per hour? That gets someone to move. And I'm going to explain to an existing employee, because we've had people come up like, we should have company phones. We should have company trucks that we can drive outside of work, all the rest of it.

I said, look, we can do all those things, but that's going to come from somewhere. And this is not the government. We write blank checks and we give forgiveness for $20,000 for no reason. That money comes from somewhere and it happens to come from everyone's paychecks. So do you want the cash or do you want the like crap. This is a decade ago. But if I go back to myself and I would have said, learn the tax code and how much you can depreciate and how much more money you're going to have without the breakdowns and the best tech skinny business, I expect now to graduate a million dollars per truck. Now, we're not quite there yet but i want the best looking wrap because now at the gas station i'm getting self-generated leads every day and like we are the premier company and it is important and listen landscaping is different you beat the shit out of those trucks and i get that but for me when i really this is where a great cfo takes

place because he goes wait a minute minute. I can appreciate all this. Here's how much extra money you'll get by buying these new vehicles when they wear out in four years. You trade them back in. You get 20 grand back. And then I met Dan Antonelli with Kick Charge and really created a brand for myself and started to get the neighbors talking about us. And so a company that we bought was my mentor. And he said, Tommy, we're at Topgolf one day. He goes, I just use enterprise. I ran it for five years and then I own them and I'm able to accelerate the depreciation and actually make more money and I've got a better morale.

And I said, no way. And then I went and learned about it. I'm like, this is what I love talking about is because I didn't know it existed. I'm not saying it's right for your model. And I don't believe what's right for me is right necessarily for every single business. But the reason I need to pay six figures is because I want the best of the best, because that's the only way you're going to get to a million dollars. One guy, one truck, one million dollars. And they got to be really good students. They got to be the best of the best.

I mean, I talked to a server the other day. I really like he said he's pulling down two grand a week. million dollars and they got to be really good students they got to be the best the best i mean i talked to a server the other day i really liked he said he's pulling down two grand a week two grand but it's one of the best steak houses in all of arizona so that's what they needed they needed someone to make six figures for that premier service that i liked him he was smiling he was attentive he was cool and it was really a treat so So, you know, I was supposed to follow up with him. I forgot about that. But to your point, Tommy, too, like I think one thing that I would clarify that too, like 100% agree the different industries

are somewhat different because like with lawn care landscaping, we beat a truck up in five years, right? Especially if you're doing like loading gravel in the back and out, all that sort of thing. But this is the thing that I think for people getting started, it's important because I agree with you on the lease side or getting the debt side of thing. But this is the thing that I think for people getting started, it's important because I agree with you on the lease side or getting the debt side of things.

There's two things that I find so oftentimes why small business owners will fail. And the major thing is they listen to people like you and me, what we're doing at our level. And they somehow think that that's what they should be doing when they're first getting on their first truck, because what they'll do go do is get a brand new truck and they'll spend, you know, it's an $80,000 truck and they're paying $1,200 a month for this truck. When, if they just spent $1,200 on marketing, they'd get their business off the ground so much faster if they actually invest in a good brand, a great website. And so I think sometimes the right advice for you, I, or anyone else is not necessarily right for any other industry or size of business.

Like when you're starting out, you should not start out broke. You're going to go out on your own business. You're going to borrow five grand from your mother-in-law. That's not a good business. It's just a bad relationship advice. It's literally, yeah, you're getting a divorce. Look, here's what I would do. I would figure out a way to get an SBA loan and get a couple hundred grand and go in slow.

I would go probably in with a used truck. I'd get the best running, most reliable Nissan truck possible and put a nice wrap on it. I wouldn't spend more than two grand on the wrap, but I'd negotiate because I'm a salesperson. If I'm starting out and I wouldn't want those extra payments and I want to kind of make the mistakes by not spending a lot of money, but I know that if I'm living paycheck to paycheck, barely making ends meet, I'm going to be working a lot of hours. And I did it. Do you know why I know this? Because I bought the Nasdaq for two grand.

I bought a cheap wrap and I did it. And I was able to grow out of that. My problem is they're not learning. They're not listening to podcasts and reading books. And they get stuck in that funk for a decade, then two decades. Then they call me after three and they say, hey, Tommy, I've got over 100,000 clients. I'm like, great. Are they on service agreements? No, no, no. But they call me all the time. Well, how many employees you got? One. What am I buying here? Because I can't really pay you much

if you're not making a well. I'll give you a multiple of profit, but it's really hard because your goodwill is hard to pay for. Well, I've been around for 30 years. You don't know how many guys in one-man shows I've talked to that brag about how they've done all the work. I'm like, you've been an employee for 30 years of your own company and you don't realize it. Yeah. It's interesting stuff.

And partly, back to your point about the franchising thing too, I don't think someone should become a franchisor with just the monetary side in mind. Because the main reason we did the franchise is I knew, to your point, people don't listen, regardless of how much content they hear, even from yourself or me or whatever. So we did landscapebusinesscourse.com, podcasts, books, all this stuff. And until I actually compete with someone in their market using Augusta Lawn Care, they don't listen. All of a sudden, when we start a location in someone's market, they start to listen to podcasts.

They start implementing P4P, open book management, figuring out their marketing, getting a good website. And so I think to your point, the biggest lack that we have in all the home service industries is the lack to constantly improve oneself and not look at the status quo because I've done it the same way for 10 years that that's somehow the right way. It's not.

You're going to be behind the curve within a matter of two or three years just with software, let alone everything else that's happening with tax code and finance and regulatory environment that we're in right now. You have to stay on the cutting edge of learning and educating and becoming a better person, both physically, mentally, emotionally, and financially. And so I think that's the deciding factor of who wins in this game of our industries and not. You made me think about something. I think Donald Trump said this, and listen, Trump or Biden, I don't care. He's a billionaire, so you take it for what it's worth. But he said, the worst employee is a good employee. Bad employees get fired. Great employees move you up and they move you up fast. And when I got

2016, 2017, I got a technician and I knew everything had changed because he was so good. You know, I invited him to the disc training and he became a disc expert, a disc personality profiling. And this one guy made me so much money that I was able to follow him and build training off of what he did and what he said and how he did it. And that set me free. That was one of the things, getting on service with a great CRM was another thing. But I just noticed when you hire an excellent person like the CFO I was talking about, and my last CFO was really good too, but it was no way it wasn't ready for a hundred plus million dollar and revenue company. So I try to get them to come in at an earlier

stage because they've been where I want to go and they're excellent at what they do and they fit the culture. And when you can get those people, you'd be amazed on how quick you grow. I mean, listen, I had this thought the other day of like, I had a restart with no money at all. I know I could do it, but it's so hard. There's no way I could do it within a couple of years because unless I can get some type of loan, if I don't have credit, there's no way because I need money now. Like I spend money to make money. I invest back into the company and it multiplies. And look, I can get right back to where I am in five years. I can do this in another company in two years, get it to a hundred million now, because I got money. There were days, not that many years ago that I didn't have enough money for payroll for a month. I mean, look at, and I think most people listening probably don't. I have enough, and this is not to be conceited by any means. We have enough money in the bank right now, in our savings account, to pay for payroll for 20 weeks. They say you should have three to six months. But here's what's nice is they know every payroll, how much profit we're going to bring.

So no matter what, because everything's paid for performance. So if we stink one week and it's horrible, the CSR doesn't make it way less, the dispatch doesn't make it way less, the techs don't make it less, the stores don't make it less. The biggest expense in the home improvement industry is labor. And so the problem with that is it's a variable expense. If you're paying someone by the hour, if you can use P4P, you manually made a variable expense into fixed because you're giving a percentage. So regardless of performance, like you said, being a good week or bad week, you're giving

a percentage away. So you can do projection to the future and actually run a leaner model in terms of cashflow because you have a fixed expense versus variable when it comes to labor. That's well said. And you know, that's what people need to think about. And you know, there's a great book that I think everybody should read. It's Double Your Profits in Six Months or Less by Bob Pfeiffer. And he talks about signing all the checks personally because you start realizing what's going out. Never let anybody in charge of the money or the marketing.

Those are two things that I stay really big on here because if you get someone else in there, a mother-in-law, a father-in-law, an uncle, a cousin, all of a sudden the money starts flying and you go, where did the money go? I mean, Alan Rohr wrote the book, Where Did the Money Go? It's a great book. I got it on my shelf over here. What are some of the books that you wrote? The first one is, I'm almost embarrassed to say, it's called Millennial Millionaire. I talked about all kind of like my experience going

through college, kind of the joke that that is, and that versus entrepreneurship. The most recent book though is a good one, Pay for Performance. And really just talking about how P4P is what we need to switch to both for the employer's sake and the business and talking about open book management, things like that. So that's the most recent book I wrote. My new book is, I think I got the title, it's called Elevate. And it's how every single person, my vendors, my partnerships, my employees, and our customers, they all need to win. There doesn't need to be a loser. And it's going to be a really interesting book.

I can't wait until I finish it. What are a few books that really changed your perspective on business and really helped you move a long ways just by reading this book? One was really good. It's not the most common that people hear about all the time. And that's Made in America, Sam Walton's biography uh biography really really solid i got that yeah i didn't get through it all but i left it listen to half of it but that's it's a big yeah yeah and and honestly like i only listened to audiobooks so like i can't handle reading but i think it was the perspective of how he grew walmart and for example like he got his pilot license so he could fly over a city and

see where's the general growth of this going to go. And then he'd be trying to put his locations on the edges of those suburbs. And that's how Walmart differentiated themselves against Kmart and all the rest of the retailers is they were always in the smaller suburbs. And just how he thought about merchandising and putting out product for sale and how he'd go look at his competitors and see the weaknesses and the failures. So great book. I love that one. I think it's good for everyone to read.

You know, one of the things that he did really smart, but I don't necessarily agree with is most of his employees are on welfare because he keeps them to a minimum 25 hours or less. And so it allows you to do a lot of creative things with your labor. I mean, he's smart for it. And the one thing I would tell you guys that are listening is never compare yourself to Walmart as far as being the cheapest, because the Walmart says you pay less. They don't pay less, live better, whatever. And I would say that model,

Walmart did it excellently, but they're the only one I know. Discount tire is the most expensive tire store there is, but they get the best warranty. And I just would be very careful about going in as the price leader. I never agree with being the price leader, ever. It never works out. I don't know anybody who's been super, super successful being the cheapest other than Walmart. And they've got whole teams that get paid hundreds of thousand dollars per person to negotiate because they're a force to be reckoned with. If somebody wants to get a hold of you, what do we got to do to get a hold of you? The YouTube channel is probably the best place. I post every single day of the video,

kind of what I'm doing, kind of vlog style now. And then mikeandys.com. There's a whole bunch of stuff on there for landscapers and other industry, you know, home improvement type stuff. So your podcast is the Business Bootcamp Podcast, right?

We just rebranded. It's just now the Mike Andys Podcast. So we post on there a few times a week. So definitely if someone's into podcasts, check that out. And we talked about a lot of things. So I'll let you close this out. Just maybe one final thought,

maybe something we didn't talk about. A little piece of advice for the listeners to take away. I think the biggest thing is determining what information you're hearing and is it contextual to your current size of business? If you're in that zero to 500,000 annual revenue point, everything we talk about outside of sales literally should be going one ear and out the other because the only thing that matters if you're trying to

scale is sales. And if you're beyond that and you're hitting a wall, a million or a million, two or 2 million, you can't figure out why no one's staying with you. Probably leadership, probably focusing on hiring and becoming a better organizer internally. And so take everything you hear, because if you're going to listen to a guy on YouTube that does 100,000 a year, but it makes really cool YouTube videos, he's going to be talking about his equipment, know what type of truck he has,

and this little gadget he bought on Amazon. It's like, that's not what's going to move the needle for a million dollar business. So you've got to take the information that you're hearing, the education you're hearing, and contextualize it with the size of business. Very important because that's not the same as you build and scale a company. Couldn't agree more.

And you know, that's something I need to think about. And I was going to give you the last word, but oops. But Dan Antonelli and I were talking about how important branding is. And I got a guy that listens to the podcast regularly and he went and spent $20,000 on Dan Antonelli. Then he bought a new truck. And then I said, all right, you did that. I didn't know you did that. But now we got to think about what money's going into making your phone ring. We need to get a website built. We need to get friends and family, go service all their garage doors or whatever your business is.

And let's get a bunch of reviews. And then let's figure out how we're going to do some PPC, just little things to get the ball rolling and friends, family. I want you to go to BNI groups. I want you to do group bonds. This is how you got to start. Cause you don't have a lot of money. He's like, well, I don't even have the money to do that. I'm like, wait a minute. You spent everything on the brand of the truck and you don't have any money left. No. I'm like, well, you got a good, really

good name, sexy truck. Now we got to get really creative with how we're going to get you leads. So this is what's interesting. I think I was talking about this yesterday, Tommy. And that is like what people fail to remember is like, if you just look at a balance sheet and you take cash and you turn it into a truck, you didn't do any sort of creation of value there. You simply move cash from one asset of cash into another asset of a truck. And it's a depreciating asset, by the way. And if you keep it as cash, it's also going to stay as a depreciating asset because it goes down to inflation of right now, like 8%, 9% a year. That's why you leverage. And I'm like more like, look, if I get a loan at 3%, 4%, do you think I pay off my trucks? Hell no. The money I make with cash is so much greater

than the fees I'm paying at these low interest rates. And they're still, they're lower than they've ever been in mankind in the last 5,000 years still. So, and the real business creation is created when you take a customer and you buy them for X amount, you generate a profit from their lifetime value. That's where multiples and enterprise value and a business is created, not buying trucks and more equipment. And so, you know, for your friend, uh, person you're talking about, I was like, yeah, you had a truck and you had a name, but like, there's no business there.

Customers is what makes a business and generating revenue and having a Delta between profit and expenses. That's where a business is formed. And when you create something, creating like making something out of nothing, not generating, you know, moving numbers on a balance sheet. It's interesting because I do believe in premium brands that I'd want in my house. You know, as I have kids, I want a safe person that's been drug tested and background checked in my garage. And I think people are like, literally, when they get done with every Tom, Dick, and Harry out there that's driving an old truck,

and literally just, there's no uniform. They look like slobs. They stink. They're like, I just want to get it fixed right. And I'm willing to spend the money now because I've had three other companies out here and they haven't fixed it. And so that's how I became a premier company

with the best training in the industry. So there's a happy medium, but I started out that guy. I don't think I smelled bad, but I definitely, so it's a great topic. I mean, this has been great for me. It's nice to hear you just point out to people that there's not a one size fits all. It's where you're at in your company, how much money you have, what industry you're in. But there is some key fundamentals. I mean, good Google reviews matter, good Yelp reviews, good next door reviews, focus on your online reputation. A lot of people don't believe that I can tell you. And if you ever talked to private equity or anybody, the first thing they look at to it, also think about your indeed in glass door. I think that goes overlooked a lot. And we look forward to having you in january to close things off there we go opening keynote speaker landscape

summit i really appreciate you i can't wait on oh we're gonna have fun man i appreciate you very much it's good to see you absolutely tommy we'll stay in touch brother if there's anything i can do let me know all right we'll do that take care bye, guys, I just wanted to thank you real quick for listening to the podcast. From the bottom of my heart, it means a lot to me. And I hope you're getting as much as I am out of this podcast. Our goal is to enrich your lives and enrich your businesses and your internal customers, which is your staff. And if you get a chance, please, please, please subscribe. You're going to find out all the new podcasts.

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