The Home Service Expert Podcast - Home Service Expert Goals for 2019

Episode Date: January 7, 2019

In this special episode of the Home Service Expert, Tommy talks about his goals for the new year, and reveals some of his best-kept trade secrets, and valuable actionable tips for transforming your business in 2019. In this episode, we talked about mindset, management, operations...

This is the Home Service Expert podcast with Tommy Mello. Let's talk about bringing in some more money for your home service business. 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. Hey guys, welcome to the Home Service Expert. My name is Tommy Mello, and today I'm riding solo.

And I wanted to talk about what's happened this year and where we're going into this next year. And I want to do something a little bit differently. I want to attack several things that I think is so important when you're running your home service business and what to look forward to in this next year. So the books come out, The Home Service Millionaire, I've been getting a lot of feedback, lots of good things, maybe some things I could have done better, but constructive criticism is always good. And I want to kind of dissect what's in the book. And my Audible version is coming out where I share a lot more than I did in just the writings. I share personal stories and what I mean by certain things. So I think you guys will get a lot out of the audio book, which I'll tell you later where to get it. We're working on that right now. But mindset seems to

be a limiting factor that we really discuss is truly understanding your why, as Simon Sinek would explain to us. And the why is really what's going to get us through those tough times. And a lot of us have been through tough times in the home service niche. And I got to tell you, I've gone through a lot of stuff this year, and it's really made me stronger. And talking to people on an everyday basis that year and it's really made me stronger. And talking to people on an everyday basis that come onto the podcast has made me so much stronger and understand so many things. So the number one goal for me going into this new year is simple accountability. I want to create an environment that creates a winning solution for every one of my staff.

So I've hired several people right now to work with me on dissecting my manuals and understanding what needs to be done. And we talk a lot about key performance indicators and how to reward the right stuff and how to de-incentivize the wrong stuff. And I'll give you a quick scenario. We tend to have people miss Mondays because Mondays by far our busiest day. And the people have no incentive to work on the busiest day because they may make 15 to 17, whatever bucks an hour. We're a good company. We give them insurance and we give them some

paid time off and all that good stuff, but there's really nothing in it for them. So we go back to that, the same thing we've talked about on the podcast, which is with them. So what's really in it for that other person? And what I challenge you to think about is where could people make more money working for you? And where does it really point out the other people that aren't making money for you? So I've hired this group of people to come work with me to try to create a plan that's easily documented. It's easily predictable on what is a winning situation. So it's not easy to take these numbers of what we expect,

extract them from a CRM and make sure the pay is simple. It's black and white that they say, this is amazing. So I'll give you an example of something my call center manager has put together right now that I'm truly excited about. We came up with a CSR way of paying differently. The CSR pay is going to go off of attendance. You get a dollar if you're perfectly on time throughout the week. And that accounts for what time you leave and what time you take your breaks and your lunch break. There's interdepartment errors, which means that you put the right priority on the call, that you assign it to the right

technician, things of that nature. The next one is a shift differential. So if you work later hours or weekends or night shifts, you're not going to get penalized. You'll actually make more money for taking those phone calls. So it incentivizes people to take those shifts. The next thing we're going to talk about is quality, which is basically a scorecard. It says, were you smiling on the phone? Did you answer the right questions? Did you ask the right questions? Did you repeat the information if it's street or drive? The next thing we're going to talk about is your booking rate. Now, this one, you can make an extra $5 a phone call. And the last one is your cancellation count. But what I want to explain to you guys is as we work these numbers for the last four weeks, our top performers made over $20 an hour. One of them made $16 an hour. One of them would have

made $12 an hour. There's one, two, three, four, five, six people that would have made minimum wage because they're not incentivized to do the right stuff. So we've been running people through these different pay grade scenarios. And what we found was the true top performers are very, very excited. And what do you think is going to happen when people find out they can make $25 an hour here if they work their butts off? We're going to attract the right people because $14 an hour doesn't attract the right things. And I got to tell you that paying people for their performance is not a bad thing. So I started thinking a lot about what I can do to do this in every department. And I started thinking about another category. And the other category is dispatching. And you might say dispatching,

obviously, the main thing you want to worry about is keeping your guys busy and making sure there's not a lot of drive time, which I agree with that. But you want to get the best performers. What I mean by best performers is I look at three things that Service Titan gives me. I look at their sales average, which I got to pay my bills. And I make sure they're using a checklist. I make sure they're doing it in an economical, honest way for the customer. I make sure that we fail parts that are bad. I make sure that we give them options on new technology, such as LiftMaster's MyQ system. I make sure that they check the bottom rubber, the spring pad, how the operator was framed.

And if you're simply going through a checklist and advising people and giving them options, that's not a bad thing. So sales is really customer service, in my opinion. Actually, all my sales training from now on is switching to a new topic. I'm going to call it customer satisfaction manual instead of sales, because it really is. I'm giving them options. I'm going over, I'm educating, I'm building rapport. The next big thing for the dispatchers that I've been looking at is to look at the technicians on conversion rate. I want them to be able to show the customer what's going on and earn that customer's business and reward them for that. So the next big factor is conversion rate. And obviously, the most important thing is customer satisfaction, which Service Titan gives us.

So customer satisfaction, I don't care what kind of tickets you're getting or conversions or whatever. If the customer is not happy, you're losing. So when it comes to dispatching, I think that you got to start thinking about is utilization rate. Meaning how often are your guys in a garage door working on an air conditioning or roof or whatever it might be? I'm going to use garage doors this whole time. So if I have a guy that's doing really, really good, the one thing I want everybody to start thinking about out there is

getting a real document together that says the hours they're going to work. And my goal for each and every one of you is to take away all of the reasons why they could say no. So I want you to start paying for their gas and I want you to get a nice truck for them and get them an iPad. And then what my goal is, is what I've understood now,

studying these numbers for the last month is, I don't care where I send my great guys that are great at conversions and great at customer service. They're going to maximize every opportunity. So the more I get them inside that garage door talking to the customer in the areas they're in without a lot of drive time, the more money I'm going to make as a company. So utilization. So the guys will not be able to say no because they signed a statement. Now, you should have a manager of the technicians and then obviously door sales, in my opinion.

You should separate those. So you've got your technicians that fix doors and then you've got your guys that sell new doors and you should have a manager for each of them. And the manager should sit with the dispatchers. So if a technician says, no, I don't want to run that call. It doesn't sound like a good one. There's checks and balances for that. And obviously the manager deals with it and you get a verbal warning, then you get written up. That's what this is all about. So I care about utilization and I care about cancellations. So your goal should be to maximize that day as a dispatcher. And I need to be calling all my future customers, the ones that I have on the agenda for tomorrow and the next day, and trying to fit them in.

If my guy's moving quickly throughout the day, let's just say we were out there last year, we fixed a lot of things, they only wanted to tune up, sure. But why would they have to wait two hours or three hours? Our dispatchers need to work hard to do that. And basically, that's what I want to grow in every role. So I want you guys to start thinking about how you can pay your people that kick butt and incentivize them to do the things that matter to your bottom line. And don't get crazy with the formulas. Just understand there needs to be checks and balances. And I got a lot

of ways to do this. Like for the scorecard, I'm using a simple company called SurveyMonkey. And then with SurveyMonkey, I have a third party person that just goes in and they randomly pick 10 calls or 10% of the calls and they go in and they rate them. And it's random. And what I love about random is the IRS is random. Everybody pays their taxes and pays on time for the most part. And this is tough to say in the home service niche, but for the most part, they do. And the reason why is

because you know you could go to jail and get in big trouble if you don't. And you know there's a chance you could get audited. Well, that's what this is supposed to do. Everybody knows they're being checked upon. So really start thinking about your core roles.

You got technicians, dispatchers, CSRs, and you may have a door department like I do, or maybe another department. We've got custom doors, which are building out the same thing. So the cream rises to the top. And that's what my goal is to create amazing accountability and to create consequences if it's not done. And obviously, you've got the whip and the carrot. So I want to do a lot of the carrots too. If you started improving, I will do $50 of gift cards per day for different roles. So my goal is to give the good people

that are kicking butt, making a great effort, taking smaller breaks, being here on Mondays, working the schedule, pushing the limits, following the manuals. They're going to get rewarded heavily, not only in their pay, but gift cards and gratification and trophies. I've got a giraffe trophy that we're going to put their name on the plaque. That's what we're starting this year. And the reason it's a giraffe

is because they're the people that are willing to stick their neck out for the company, as well as giraffes have the biggest hearts because they got to pump that blood up all the way to their brains for their neck. So big heart, willing to stick your neck out for the biggest hearts because they got to pump that blood up all the way to their brain through their neck. So big heart, willing to stick your neck out for the company. You're going to get your name on this plaque. We're going to talk about you. You're going to get a parking spot. You're going to go out to lunch with us.

You're going to really be a part of the company. And I want to make this a healthy culture. So really start thinking about the culture of your business. Make it a place where people come into work when they work hard. They're very, very happy. They're making more money and they're liked by everybody and they're acknowledged by everybody. And the next big thing that I really want to talk about is understanding the pay structures you guys pay. And Ellen Rohrer is the best at this, but make sure your numbers are right. Don't rip customers off, but make sure you're making enough money to cover your bills with nice things.

So I want you to start thinking about having nice trucks, paying for gas, getting insurance, state-of-the-art technology, newer iPads, and being able to afford this stuff. Now, I'm on a lot of different stuff online on Facebook. And I read a lot, a lot of groups. I'm involved with roofing, air conditioning, plumbing. I mean, I'm on all of them. And I don't really mention anything on most of them. I'm mostly there to read what other people are saying. Nobody really knows what the prices they should be charging, and they don't agree with high prices. And I don't know if many people know this,

but it costs about 50 cents to make a pizza, but you'll pay 15 bucks at Domino's. And I want to talk about a simple story that goes something like this. There's a guy that goes out to a house with a wood floor that's creaky. And on this floor, the customer had about 10 different technicians out to try to figure out why it's creaking. And they tried gluing down all this stuff and they tried every which way to make this store stop creaking and they couldn't figure it out. Well, then they called the guru, the expert, and he shows up and he notices exactly where the creek's coming from.

He puts a screw right there and he charges $500. And the customer says, that screw couldn't have cost more than two pennies at Ace Hardware. How could you charge me $500? And he said, it's not about what the screw costs, it's about where I put the screw. It's the knowledge.

So when you diagnose things correctly, you give the customer options and you understand your real cost of being out there. Ellen Rohr writes about a book. It's called, Where Did the Money Go? And she learned it by Frank Blau Jr. And what it explains to us is indirect costs. So I want to talk real quick about indirect costs

with my inventory. So right now I went out and I have 19 warehouses throughout North America. And my goal is to simply get out of the warehouse business. And I'm going to explain this to you guys. Is to have a warehouse full of parts. Here's the things I'm looking at. I got an alarm company with cameras. I've got the HVAC costs and the swamp cooler and the lighting.

I've got on top of all that, the rent to rent that huge building. I still need a building for Google guaranteed, but the cost of that building is expensive because I'm getting a bigger one and I need to be able to support all the electrical bills and all the other stuff within it. Then I have shrinkage and damage, which happens when you got your own inventory. And then on top of that, let's talk about more stuff. Let's talk about the theft that goes on. And if you don't think you're getting stolen from, you're wrong.

The next big one that people don't even realize is I'm paying for a warehouse guy. Not only am I paying for the warehouse guy, but I'm paying for him to drive a vehicle. In most cases, three different vehicles with three warehouse guys. Then on top of, but I'm paying for him to drive a vehicle. In most cases, three different vehicles with three warehouse guys. Then on top of that, I'm paying for wasted hours. I'm paying for overtime.

I'm paying for their taxes. I'm paying for their insurance. I'm paying for the vehicle insurance. So these are just to name a few things. So when you add it all up, most people say, here's what the parts cost. It's probably cost me a little bit more for my overhead. And I've got to be making money. They don't account for all those other things. So what I challenge you to do is say,

are you in the warehouse business or is it better to go to a vendor? And because of my size, I can work out better deals. So that's the direction we're looking to go in. So there's a lot of things we're discussing here. And I just want you to be aware of these things going into the new year. I'm here to help you. I'm here to make you think about things differently. And it might not be the right way, but it's to challenge you to think outside of the box.

One of my goals this year is to set goals with my managers and make sure that we're working on hitting our goals. We wanted to set a stretch goal, which is a really hard one to set. And our main goal is to become a company that works with other garage door companies. We want to help them get on a service titan. We want to help them build a price book. We want to help them get a higher conversion rate. We want to show them how to book more phone calls. We want to bring into them different KPIs they never looked at and show them why it's important. And we want to be this. And realistically, here's the goal.

We're a company that builds all these other subsidiaries where we work with all these other smaller garage door companies, maybe bigger garage door companies. We're able to help them with their lead generation. We're able to help them get higher booking rates like I discussed. We're able to help them understand service type and how to train guys and help them work on our new LMS system, which is going to be able to train technicians, dispatchers, CSRs, and the door department. We're bringing in new technology, which I'm going to talk about here shortly. And we're also going to get discounts from major vendors because we're building an affinity group. And it's going to be a win-win-win. And the main goal is to build this ultimate machine

of amazing companies. And the guys that jump in first are going to make a shit ton of money. They're going to become millionaires. And it's going to be so much fun. And that's the direction we're going because we realize we're very good at a lot of things. We're good at sales. We're good at marketing. We're good at training technicians. And we really are underutilizing what we have now because we're on service time and we can build amazing companies. And we open the door and open the eyes of everybody. So if you're not in the garage or niche, we can still help you do a lot of this stuff. And I want to talk a lot about what I'm up to in the last month other than my book release. I happen to be talking to a company that built out an amazing text messaging software.

And this is going to excite everybody, I think, because the results are amazing. And I'm a personal case study of it. SMS, which is text messaging, has been a huge development over the last few years. And 97% of all text messages get answered. And it's more personal. And it's more quickly. And the problem I have is with my, you guys know I have a Christmas light business,

is a lot of times we weren't text messaging the customers. Well, if I want to get ahold of anybody, I text message them after I call them and I'll email them, which email does not work like it used to. Trying to make it in the inbox is almost impossible. Now you've got promotional,

you've got all these different sections in Gmail and all that. Then Hotmail is a different story than Outlook. So what we're going to be doing is every call we don't book will go into a sequence of text messaging. And I'm working with this company. I've already proven it out for the last three months. I'm bringing in 15% more money because it does all my follow-up on the doors not sold. It does all my follow-up on the service calls and sooner it'll do all the follow-up on the doors not sold. It does all my follow-up on the service calls and sooner it'll do all the follow-up on the calls we don't book. Then it also helps with upsells and recruiting.

And I cannot wait to get this platform built out because this is gonna make everybody listening a ton of more money. I promise you guys, we are working with the most creative team that writes the right copy to get these customers back and to get them to choose us. So if you're interested in this, just email me at tmello at a1garage.com. That's T-M-E-L-L-O

at a1garage.com. I promise you, it's going to be so cheap and so amazing. You guys are going to make so much more money next year. Now, here's something else I'm working on. There's a huge company that does postcards, okay? Now, this company happens to be the biggest postcard company in North America. And I'm meeting with the CEO next Friday. We want to make it talk to CRMs. Now, here's the good news is it doesn't have to be service-tightened.

None of the text messaging, none of the postcards need to be service-tightened. You can extract it to an Excel file that it'll pull it in automatically into the system that we're building. And it'll actually send all your customers thank you cards. It'll ask them to leave reviews. It'll ask them how we did. It'll tell them about future discounts. It'll hit them up on their service anniversary dates that they need to get the service done. It'll send them a card on Christmas. And it'll be fraction of the cost of what you get postcards from other areas. This is going to be one of the biggest things that's ever hit the home service industry. I guarantee you. Now there's obviously things out there where you could build

into them and pay a lot of money, like 70, 80, 90, a buck a card. And yeah, we can build that, but I'm looking at doing this at a much more affordable rate at a monthly service rate. And it'll be a little bit a la carte because they got to cover a little bit of postage. But I'm working with the biggest, best companies for text messaging and for the postcards. And if you want to see what happens to your business, I promise you, you follow my lead on this stuff, you're going to double your business without getting any more customers. You're not going to have to increase your marketing spend and you're going to double your revenue and double your profit. If you trust me on this one, this whole podcast today that I'm doing solo was not meant to get you guys to opt

into what I'm doing. This is meant to get you off to a great start going into this new year. And if I can help you double your revenue and double your profit, I think that's a good start. I want you to hold people accountable. And more importantly, right now, I want you to sit down and write down real goals and how you're going to hit them. I want you to write down a yearly profit goal and a yearly revenue goal. Then I want you to divide that by 12 and then divide that by four. That gets you to a weekly goal. Then I want you to divide that by seven working days and understand the five main days are Monday through Friday. And you need to micro-target those days.

And then you need to figure out to hit those goals what needs to happen today, January 1st, January 2nd, January 3rd. Now, what I would expect is you to have a linear line going straight up like a forward slash. And what that's going to mean is you're going to earn a little bit less money in January than February. Then March, you're going to earn a little bit more. Then April, you'll earn a little bit more. And how do you get there?

We get there through three ways we always talk about. We get there by getting more qualified leads, by booking more of the jobs we're getting. But the main thing is you keep your customers coming back and you charge them more money. And I want to tell you, the garage door guys out there, I'm working on another plan to get you guys into garage door storage solutions. I'm working with one of the major inventors that has all the patents on all the stuff. And it's going to double your average ticket. And it does it ethically with high morals. And it's going to be super fun.

But I'm also working a lot next year on how to create more partnership marketing. So let's say you're in Milwaukee and you're an HVAC company. We want to work with you to work on our customer list and help fulfill the emails and text messages to these customers to make them aware of seasonality. So for HVAC in the winter, there's certain things you want to do to your HVAC unit and there's certain things you want to do

to your garage door. There's certain things you might want to do to your gutters. There's certain things you might want to do to your landscaters. There's certain things you might want to do to your landscaping. So we create this group of 10 people within Milwaukee. We share our list. We sign mutual NDAs. And all of a sudden, we quadruple our business with no additional marketing. And everybody gets a finer fee. My garage door makes money if your HVAC company goes out. And the bug company makes money if I go replace the bottom rubber. Everybody makes money together.

All of our guys are staying busier and it's a win-win. And we work with companies we all love. We make sure they got good ratings out there. We make sure that they're a good company as far as ethical goes. One of the things I wanted to discuss too that's cool about service time

is the automatic reports that are coming out. So if I want to know the average customer rating from an hdac company i team up with it can make it automated that i get a report every day of the jobs that went through my phone number that comes through me and i can make sure that if it's not a five out of five or a four out of five that you're willing to give back money or do whatever it takes to make that customer that I refer to you happy. So that gives me the ultimate advantage. So guys, I really think there's a lot of good stuff coming out. I built a course around the home service millionaire. You're going to be finding out a lot about that. And it gives so much value. I promise you that's so amazing. But remember, ultimately, my main goal is to create ultimate accountability. And I want to work with you guys throughout this year to show you how to hold people accountable

and make sure they're winning when they do it, to make sure that what's in it for me is there. Number one. Number two, I want to work with you on your goal setting. I want to work with you to accomplish stretch goals that you never thought possible. And finally, I want to introduce these technologies, which SMS and postcards are something that's not been done a whole lot in this industry, which is the home service industry. And I want to show you guys how much more money we can make.

We can get more reviews. We can keep our customers coming back more often. We could get customers that are falling through our fingertips because we never followed up. We could book more phone calls. We could automate a lot of things. And then we could thank them. And then we can thank them through postcards. And they're literally super sexy postcards. They're not cheap looking postcards. They actually come as a letter. So it's a handwritten letter on the front and cursive. It's got your return address. It's got a stamp on the front of it. And it's a card that they open and they always get read. Can you imagine if everything you said got read? You would make so much money. So this is what it's all about, guys. I'm so excited for 2019. I'm excited to show you guys how much money is going to come, how much of your time back, how much more of your relationships is coming back.

So if I had a book to tell you about, like I do at the end of the podcast, you've got to read The Home Service Millionaire. I promise you, it's an amazing book. You'll get a lot out of it. I put a lot of time into there. We had 12 contributors come into there. The CEO of HomeAdvisor, the CEO of ServiceTitan, the CEO of ValPAC. You got to download the Audible book, which I'll have available on the Home Service Millionaire course here. The Home Service Millionaire website, I mean, within the next two weeks. And you're going to have a great 2019. I promise you that. Thank you so much for listening to my podcast. I really appreciate it.

And final thoughts are really sit down, set those goals. Email me at tmello at a1garage.com. Let me know what your thoughts are. Let me know what I can help you with. Let me know if you're interested in coming on the podcast, asking me some questions. I want to start setting up 15-minute consultation courses on Facebook Live to talk about what I would do

in certain situations. And there's simple little steps to hold people accountable to make win-win situations. And if we do this together, we all win. I really want to make a bunch of home service millionaires. My goal is to deliver a thousand home service millionaires in the next 10 years. And that's what's going to happen. So appreciate all you guys. This is Tommy Mello checking out from 2018. Thank you. Hey guys, I really appreciate you tuning into the podcast.

I wanted to let you know that my book is available right now on Amazon. It's called The Home Service Millionaire. That's homeservicemillionaire.com. Just go to the website. It'll show you exactly where and how to buy the book. I poured two years of knowledge into this book and I had 12 contributors. Everybody from the COO at HomeAdvisor to the CEO of Valpak and of course, Ara, the CEO of ServiceTitan. It tells you how to have the right mindset and become a millionaire and think like a millionaire. It goes into exactly how to turn on lead generation. Have those phones ringing off the hook for the customers that you want to be calling where you can make money and get great reviews. It also goes into simple things like how to attract A players.

Listen, if you want a great apple pie, you need to buy good apples, and you need to know where to buy those apples. And it also talks about simple things like knowing how to keep the score. You should have your financial check every week. You should know exactly what's coming in and out of your account. You should know when to cut advertising that's not working. And more than anything, you should know how to cut employees that aren't making it for you. Listen, you might have a big heart, but this book is going to show you how to make decisions built on numbers.

I hope you pick up the book and I really appreciate everything. I hope you're having a great day. Tune in next week. Thank you.