The Home Service Expert Podcast - Mastering The Financial Side Of Your Business

Episode Date: October 3, 2018

Justin Krane is a certified financial planner and a money strategist for business owners. He founded Krane Financial Solutions, and frequently guests as a financial expert on popular TV shows such as CBS and Fox Business News. His mission is to help business owners better understand the financial side of their business. In this episode, we talked about cash flow, scaling, revenue generation...

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 there, home service experts. Tommy Mello back at you coming here with Justin Crane.

Justin is a CFO. He's actually a virtual CFO and he's a financial advisor that manages well over a hundred million dollars. And he's here to help us understand what our numbers mean and tell us a lot about maybe how we should be looking to invest that money. Justin, how's your day going? Good, man. Thanks for having me. Yeah, I'm excited. I was telling you earlier that I don't have a lot of people on here that know what you know. And I'm going to ask you kind of an overview of what you started in,

how you started being a virtual CFO, and some of the things that you discovered that maybe small business owners were all making the same mistake when it comes to understanding the numbers. Sure, yeah. I started out as a financial advisor at UBS, one of the big Wall Street firms, and eventually just made my way into opening up my own business as a fee-only financial advisor. And I love running businesses and talking business strategy and just dealing with someone's business, especially their numbers. And I knew that

that was a direction that I wanted to go in. And I just kind of rolled with it, opened up my own business, just dove in learning about the numbers in someone's business, how I could help them take more control on it, implement changes and really, I don't know, have something to show for it. Because I think the success of someone's business is really going to fund their true life goals. And I think that that's what it's all about. Yeah. And I think a lot of us really, if you were to sit down, I'd say, in your definition of small business, medium business, big business, as far as, I guess you rate that on revenue, what are your definitions?

It's a great question. A lot of people are like, oh, small business is like 10 million in sales or less. Like, great, that's fine. But like the average small business owner is doing like somewhere between 50,000 and like 250,000 in sales. So that's like on the low end. Then you want to maybe go up from there from 250 to like two or three million up to about 5 million. In my opinion, that's, you know, that whole, all those ranges are really small business owners. I think anyone doing over 5 or 10 million, yeah, maybe they are a small business owner, but they have employees and they have different challenges. So I'm really talking about the business owner that's doing six figures or multi-six figures or someone who's trying to get there that's pretty

close. So I think a lot of the people that listen to this podcast are somewhere in the six figure range, maybe approaching seven figures. And I think that's what basically has made America what it is today. It's the people like that, that have really caused success all the way around. Tell me a little bit about the first things that you ask and really know if a business owner understands their numbers and why it's important? Do you have a set of books? I mean, most people have a set of books. So the first question is, do you have a set of books? The second question is, are you looking at the numbers? And most people feel really bad that they're not or that they just don't speak the language and they don't really know what's going on with the numbers. So the negative energy sets in and then they're like, well, I don't really love my bookkeeper.

And I just, I don't really understand. Like, I really, really want to know what's going on, but I don't know what to do. No one's giving me any strategy on it. And that's where, that's why I started it because there's no profession. I mean, there's CFOs for like multi seven figure businesses, but where does like the average person go to get advice on their business when they're doing 500 grand, 250, a million, 2 million? There's no profession. Yeah, there really isn't. You can't afford to pay six figures to have a professional come in. And the consultants are very expensive as well. What would you say are some of the KPIs that you really focus in on?

Obviously, like I told you before, I think cashflow is like, when I talk to banks and investors and venture capitalists, they're like, what's your cashflow? What's your cashflow? And so many business owners are burning through their cash all the time.

And they're really, they're functioning on their cashflow. Tell me some of the dangers and how that all works. Well, the first thing is, I think profitability is a biggie. So we want to make sure that business owners are making at least 10% or more in profits. And then the cash flow term is very, very misleading because a lot of people don't really know what cash flow is and what it means. Most business owners just think it's like, oh, cash flow equals sales.

Some other people think, oh, it's cash flow equals profits. Like the real technical definition is neither of those. It's really your net income less any investments that you make in your business or money that you take out of your business. But I think the biggest struggle that business owners have is this term called free cash flow, which basically looks at how much money the business is making and how much cash the business generates after the business owner pays himself or herself and pay taxes and all that kind of stuff. That's what free cash flow

is. That's what free cash flow is. That's what people love. It's like the business is making money. I'm paying myself and I got money left at the end of the month. That's what that means. And that's what I think people need to look at. So what is free cash flow in comparison? If you were to take free cash flow and compare it to EBITDA, what does that mean?

And explain to the audience what that means, the EBITDA and all that. Yeah, EBITDA is like interest and taxes and depreciation and all of that kind of stuff. The free cash flow just takes into consideration from just running your business, how much cash does it generate? The EBITDA, you've got other things in there, which, like I said, interest, taxes, depreciation, and amortization. Those are just four more things that get added in to that cash flow metric. But I just think that people need to know, like, at the beginning of the month, how much money do I have

in the bank account? At the end of the month, how much money do I have? And then the real question is, where did it go? And most people have their head in the sand and they have no idea. So what I like to do with a lot of people that I consult is say, write down everything that you do during a day, like a journal to kind of do the Pareto 80-20 rule. When I was in economics, and I want to say I was probably 20 years old, the teacher said... Wait, I thought you were 21. Yeah. Almost. Yeah.

Okay. So she said, I want you to write down everything you spend on a daily basis. So I want you to circle K. And the results were astounding. The people in the class, they go in to pump gas and they spend an extra eight dollars and ten dollars here by cigarettes and they pick up Doritos and a hot dog and fast food and this and that. And the waste that goes into someone's individual spending was outrageous. And I can't even imagine because I know we blow a lot of money in and I'm like,

how did this happen? Because, you know, when you get 20, 30 million, 40 million going in, a practice that I like to do, and I don't advise this to anybody, but I cancel all my credit cards at least once a year. We call all our major vendors. We have the other credit card in hand and we call all the major vendors. What we find is we actually get rid of like 10% of waste that like, oh yeah, we were paying for that program, but we stopped using it or just find out we were getting gouged by somebody. Or I even had this happen with LA Fitness a couple of weeks ago that I'm like, that wasn't even my membership I was paying for, but I would have never realized it unless I did this. What is your advice to get those kinds of controls in place that actually, mine is reactive, not proactive, I guess.

So, yeah, no, I think like if you have a metric for like profitability and cash and sales, you can then back into the expenses that you need to have in your business so that you don't run out of money. And then you can just pull up an expense report for any period that you want and just go through the numbers and be like, is this one good? Is this one good? Is this one not good? Does this one serve me? Am I making money on it? And a lot of these things are recurring expenses, which are even more important for a business owner to know versus something that's like a one-time expense where, you know, if you spend money one time, it's one time. It's not going to happen every month, but recurring, it's really important to be able

to understand that. Yeah, that makes sense. So a lot of businesses, they end up lowering their prices. And I got to tell you, the first thing people do is they cut their marketing budget. The second thing they do is they lower their prices. And I feel like that's a death spiral. Tell me about your experience with that. And what's another way to combat it when the economy is kind of not going so well and things just aren't going good? I'm not a big fan of discounting and lowering prices. I mean, you can

compete on margin and really on volume if you want, but how many people can really be Amazon? And I think most business owners get into trouble when they try to compete on price. They're more viewed as like a commodity. And then people wait for discounts and they're not really loyal. And then they'll bail if someone else has a better offer and blah, blah, blah. So I'd rather not compete on price and compete on context, which is offering a buyer two prices and giving the brain something to look at to compare one price to the other and make the person feel like they're getting a deal when they're looking at your pricing. So for example, I can give you an example. Let's say you were checking into, I don't know, whatever, like the Four Seasons Hotel. You can get a room for $400 that faces the garden or for $450 that faces the ocean.

So for $50 more, you're like, okay, I'll do it. That's the way that people, they look at one price. If there's just one, they can't compare it to anything. The brain likes to have context. So if you have two prices and make people feel like they're getting a deal on one of them, the conversions will go up and more people will buy. Yeah. Yeah. I love two prices. I used to love three prices, but everybody goes for the middle. So now you have good and best and I've been very successful because when I think my numbers, I think a lot about

how much standing inventory. And I got to tell you, we're in the process as of the last quarter of last year is actually, I won't say we're doing just in time, but we've definitely, we had so much money in inventory. And then we walked through and we said, how much stuff has been sitting here for three months or more? And it's astounding that you get these guys with 20,000 square foot warehouses that say, I need more room. And then you actually walk through how much do you find that inventory really is a problem with small business?

For product-based business owners, it is. But I think having the inventory is a result of not knowing what people buy or what you're selling if it's right. I mean, there's a problem why people have inventory. Someone's not buying it, which is a whole other thing. Like, okay, well, why are they not buying it? Do they think they're not getting a deal? Is the messaging bad? Is it too expensive?

Are they not willing to pay that? Is there not enough social proof? Like, I could go on and on and on. But it's really what people do with that inventory. They either have to mark it down or bundle it. Like I think bundling is a great way to get rid of some stuff rather than just selling it on its own. If you can bundle something that's been sitting on your shelf for a while

and not even give someone the option of whether they want it or not and just throw it in and mark up the price a little bit more, people may not recognize that they're buying it. And what it allows you to do is make a marginal dollar and sell it. Yeah. The one thing that we implemented is mins and maxes. And I just feel like you can't go wrong if you do that. And even though we were mostly service, the products make a big difference. I want to talk about another point here because I know you're limited on time. You're a big advocate of paying yourself first. And I feel like a lot of businesses don't really understand that concept. And there's a great book I read, my CPA gave me several, several years ago called The Richest Man in Babylon. And it talks a lot about this. I'm not

sure if you're familiar with it, but tell me a little bit about your concept and how that works yeah no i wrote that book that was me i'm joking i was like i didn't think you wrote that no no but it's a very very good book i mean you know and like you're trying to tell like your wife or your kid to do something and if you tell them they won't listen but if they hear it from joe schmoe has some authority, whatever, people will listen. Oh yeah. Yeah. So pay yourself first is huge. I believe in it. And if you're not paying yourself, your business isn't worth anything because the person that's going to buy your business, when you want to sell it, if there's not a line item in for a salary or some sort of payout for the owner or the person running it, they're

not going to value the business as much. So you've got to pay yourself something, preferably through a salary with a paycheck and tax withholding and all that stuff. Not a draw, but a salary. So I believe in that. All right. Well, that leads me to the elephant in the room, because I've heard this more times than you can imagine is, Tommy, that's the set of books that I give to

the government. That's not the set of books. Obviously, I take a lot of the cash and I take this, I take this, I take this. And it's not uncommon because they're flying under the radar and the government, you know, I'm not advising anybody to do this. I'm just saying I know that it happens a lot. And the whole point is the IRS isn't coming after you for five grand. They've got limited resources, but you really are shooting yourself in the foot because typically when a business wants to buy a company out, they're going to look at the last three years of their books. And I've heard so many people say, well, look, you know, I don't do this. I don't do this. But in this day and age with the baby boomers retiring at the rate they are and looking to sell their businesses, that just doesn't make

sense. Tell me, have you gotten that answer before? Tell me a little bit about your experience with that. I think, yeah, number one, I mean, trying to get a loan from a bank or to buy the business or vendor financing is one thing. But how about people that want to buy a house? Literally. How about the small business owner that's looking to buy a house? If your business is unprofitable, I'm sorry, the bank is not going to lend you money. There's not.

So you have to have a profitable business consistently for two or three years to be able to demonstrate that you can make a mortgage payment. So many people are concerned about running everything through their business and making no profit so they don't have to pay taxes. But when they want to go borrow money or get a loan or whatever, they come into trouble. So as far as how aggressive should someone be in terms of like, you know, running what through the business and whatnot,

that's a question for the accountants. Obviously, if it's a qualified business expense, of course, you want to deduct it. But the gray areas, I'd rather have an accountant answer that. It's really a case-by-case scenario. But I do have this philosophy, is that if your mindset is, oh, I'm not paying any taxes, so everything's great, well, there's a problem. You're not paying taxes because the business isn't making money. Since you're paying a lot in taxes, it's not actually a bad thing. It means the business is making money. There's nothing wrong with that. Sometimes people will go out and spend, I'm making this up, $5,000 on a high-end computer

just so they can get a write-off so they don't have to pay taxes. But they don't need the computer. So sometimes it's better to just pay the taxes. Write-offs do not equal. So many people will go and they'll do a $600 dinner and they'll smile and go, it's a write-off.

And I'm like, dude, you must be kidding me. It's not cash. Write-off does not equal cash in the bank. It's not even close to the same thing. A write-off's come in handy to lower your income bracket. And that's why you could write off interest. If you figure out a way to lower your income bracket and it makes sense, but that's something that most business owners

should not choose to do. They're not an advisor. They're not financially equipped to make that decision. So if somebody says, hey, listen, what can you buy to pull down your taxable income to this bracket? Because it's going to save you 3% on a million dollars, which is only $30,000. But if you spend $30,000, you get there. So spend it, do it. That's kind of the goal of what a write-off is meant to do, not be cash. And I really appreciate you bringing that up. One of the things that we've decided to opt into is a lease to own on new vehicles. And one of the things that I was challenged mentally of, I could buy these vehicles. We've got our own automotive shop. We could tune them up.

We could do all the stuff. We wrap them ourselves. And it just made sense to me because my dad used to run and own different transmission shops. And I'm like, man, I've never bought a new car in my life. Why would I start with a business? But there's so many things that this company does. And I'm working with Enterprise and there's a lot of companies out there that do this. But number one, they make sure your cars are getting maintained. Number two, they tell you the optimal time to sell the vehicle. So you're always driving

something less than four years old where you can pull all the money back out of it. It's not a high interest rate. They help you with geofencing to know if you guys are driving late or what's going on. They have your people swap vehicles because if one guy's putting a ton of miles on one and the other guy's not, they tell you, hey, have these two swapped. I can't tell you. And you can depreciate everything up front now with the new tax laws. You can depreciate the whole value of it because you're leasing to own it. Tell me a little bit about your advice on buying, leasing to own, or buying used versus new because it's a morale issue too, I think.

So what is your take on that? You're talking about equipment i'm talking about vehicles because every small business cars every yeah a truck a van my short answer is i have no opinion no advice to give it can go either way seriously the longer one like yeah like i i wish i could give you a value of a car, if you like getting new cars. I bought a new car, I financed it, I paid it off, and I kept it. But for the last two years, it was a Prius. It just didn't perform that well.

So I put good money into a car that was depreciating when I could have used that money to get something new or lease it or blah, blah, blah. I'm a fan of making sure that you're getting good value and you understand what you're getting into. If you feel like you're going to use the car for a while or use a piece of equipment or whatever, and if you can benefit from buying it and then writing it off that way, do it. If you feel like the average life of what you're buying

is three or four years and you need something new, then you got to lease it. Most of the time, that's what would work. I talked to a consultant the other day and he said, look, he goes with the home service company that I used to run. He said, we were cash rich, man. We could buy anything. And he goes, we found that putting the money into vehicles was not the best option for the company and the health of the company. Now, I will say this. I also have a buddy of mine who's got another garage store business. And he said, Tommy, all of my extra money goes to appreciating assets, meaning he

bought the land and the building versus putting the money into vehicles. And he goes, Tommy, I became a millionaire because of the land I bought. Kind of like the McDonald's story, not my business. And here you are because I owned 150 vehicles out, you know, outright. And I just I was kind of kicking myself in the ass saying I could own some land now. So it's just I'm not telling anybody. I'm not giving any advice. I'm just saying the people that I've talked to, when you think about the morale issues,

your top guys being down from work, the reason why we love Network Fleet, it's called Verizon Network Fleet, is because it has free towing. Now that's a bad sign that we chose a company because it has free towing. Let me just tell you. But regardless of that, I

think any advice on this subject is just, it's very circumstantial and I think that was a great answer. So if you're out in the field a lot, you're working in the business all day long. I feel like a lot of the businesses that you're probably working with and under that million dollar range is you find they have the hardest time hiring their first few employees and actually keeping them, retaining them and building a good business on solid structure, meaning they've got a handbook. They know if their job is good or bad.

There's just so many different aspects of that. I actually I actually wrote something real quick. I don't know. I got to find it. But what are your thoughts on that? As far as these business owners trying to work on the business instead of in the business? That's a great point. I think a lot of them are working in and not on. And I think a great place to start is to really understand what your business model is. Like, how do you really make money? What is it that you have to do to make money? And is it a way that's easy? Is it simple or is it complex? And is it hard? If it's easier, simple, and it just is more of a cash cow,

getting back to that pre-cash flow, then that's a great thing. Most business owners, business models are not great. And what they need to do is think of a way to make it more leveraged and scalable. Now, a big extreme that is just like, but you'll get the point, Tommy, is like, if you're a realtor, that is one of the worst business models out there. You're working really hard to get paid one time. And if someone doesn't like the chandelier, they could cancel the escrow,

right? If you can't get a loan, whatever, you're working really, really hard to get paid one time. So what can we do where we can get paid more than one time? You know, what could someone do to create more recurring revenue? In my opinion, that's like gold. If your business has a lot more recurring revenue, both of mine do, that's where you want to go. That's where I would work on the business is what can you do to create that and have good margins on it. So in the home service business, it's called a service agreement. And that's where I spent a lot of my time focused. There's a company out there that consults HVAC and plumbing companies called Nextar. They teach a lot about that. And when you think about this, you talk about the lifetime value of the customer. And so many times we'll do a chimney or a set of gutters or a roof and it's wham, bam.

Nice to meet you. Hey, we'll see you in about 20 years when you should be coming up with a maintenance program that actually delivers, first of all, ethical and moral, but it also should deliver a very significant value. And you would never think of a service agreement with your garage door, but do many people use their front doors anymore? No. I mean, the stuff wears out on it. So that's one of our biggest objectives this year is to get to 20% plus on our

home service contracts. And I love that you said that because when you're buying out a company, especially under a million dollars, you might get three to five times the profitability or EBITDA. When you're selling service contracts, you should take that number and double to triple it.

If you could say it, these are customers that have been with us several years that are going to continue to pay us every year. And believe it or not, 80% of that at the minimum is profitability on those service

contracts. Although you might take it in the chin on some of them. And that's what insurance is all about. I mean, insurance companies, yes, there are people that get cancer and they pay out hundreds of thousands of dollars, but it's really about collecting from everybody and being able to give people that insurance and that peace of mind. So I think that if there's one major thing that the home service experts should take out of this out there is find a way to create an income of each customer that reproduces itself weekly, monthly, yearly, instead of just having that one-time fee. So that's a great piece of advice. And I think one of the things that I've learned is to prioritize and actually have initiatives where everybody in the company is working on.

And I don't think that's the first one for most businesses. First thing is start with an organizational chart and make sure everybody knows if they're doing a good job or bad job. But I think once you're established and you're doing millions of dollars, you need to start putting your head on your thinking cap about those bigger problems. But yeah. Can I actually make a comment on you asked me a question a little bit about, you know, hiring people and all that. And we didn't address that. I think it's important. One of the biggest mistakes that I see business owners make is it's the connection between free time, between free time and hiring someone. So a lot of times when business owners hire someone, I'm not talking about a business development person, I'm talking about like an admin

or someone that does like some sort of like data management administrative function in the business. Generally, they're freeing up your time, meaning that you now have more time. So a lot of times business owners will hire these admins and they'll look to create an ROI off of the admin, but the admin isn't the one going out and marketing or drumming up business. They're just taking work off your plate. So the responsibility falls on who you, the business owner to go out and sell more and market more, but they take that free time and end up getting stuck in other areas like social media, working on the wrong types of clients, just doing the wrong initiatives. And I see it so much, and I think it's important for the people listening to really understand that it's their responsibility to monetize their free time. Well, you talk about revenue generating.

What's a revenue generating employee? And the fact is that you should have, this is what I call a healthy company, a two to one ratio, meaning that your technicians, your installers, not your salespeople, because they are revenue generating, but in a way they're not doing the work. So your workers out there, whether it's laying cement, framing, you should have two to every employee that's not. So if you've got, you know, it's pretty simple numbers. If you've got 99 employees, 66 of them should be out there working, bringing in the dollar. 33% should be administrating all that stuff. And that is a very good ratio. And that's something that I don't think a lot of us do.

And they don't understand that. A bad ratio is if you have a four to one, because there's no way administratively you could support that. At least your company's probably not run efficiently. And there's some golden rules. And I think it's somewhat circumstantial, but I like to keep my payroll under 30%. Does that sound like something that's feasible from what you've experienced? Of your gross profit, yes. Of your sales,

that's different. But yeah, no, 30% is good. It depends what line of business you're in. That's not for me because I don't have as many people working for me. And it's a much simpler model. But yeah, I mean, I would go with that. What I've heard is, is if you're if you're at 20%, you're probably a lot of people some raises. And if you're at 40%, you're really looking at going out of business quick. So I'm just gonna ask you a couple more quick questions. I know you got to get going. Yeah. So when you think about scalability, I think about the first time that I decided I'm going to go into Tucson and then I'm going to go into Milwaukee and then Vegas and all these different areas.

There wasn't any writing on the wall per se, as much as there, I think there should have been. When do you recommend a business to seriously think about scaling? From the first day they get into business. That's a good answer. Yeah. Literally like one of the bigger mistakes I made. And when I, I never, I didn't know what scaling was like, it was like, was like, no, I'm not ancient. I'm 45, but like, it's just, it's such a big term now. Remember when I got into business,

it did seem like it was, but a lot of business owners will onesie, twosie it, which I think is okay, but they have to have a framework and a mindset of how they can set up their business from the start so that they can grow it. And just for the people listening, just to explain what scaling is, it means if you're going to invest $1 to make $2, you can also invest $1.10 to make $4. That's an example of what scaling is. It's just a way where your sales go up more than your expenses do. To me, it's that simple, where you just, the more money you spend, the greater the exponential growth of your sales will be. Yeah, I like that definition. I mean, it makes sense to me as far as some consultants that I've worked with and had the pleasure of meeting are very scalable and they have different rules. Like I talked to a guy earlier, he's like, my number one rule is it needs to be scalable and I need to be able to do it from anywhere.

Meaning that the smartest people in the world that do stuff, they've got the same exact approach. They say this is how it's going to be. If I'm going to come in and consult your business, step one is this, step two is this, step three is this, step four. And after step 11, you're going to be a good business if you continue to do the things we've taught you. Whereas non-scalable is just kind of kicking around questions and really not having a end in mind. When I think about scaling, I know it costs a lot of money to scale and you got to have a larger infrastructure. And it takes a couple of years to really have a good market because nobody's ever heard of you in a lot of markets, at least for the home service,

that is. So you got to understand, Justin, it's hard to go from a business you've been working 15 years at to build a roofing company and then go to a different state and do it. I think what my definition is, is we're planting seeds in that area to become what we've done in the last 15 years. We can get there a lot faster. We could share the call center. We could share the dispatchers. We don't need to hire a new CFO or a controller or a CTO or whatever you might have in your company. So your expenses do come down

a lot. Although you got to build the infrastructure to support that when you're dealing with humans. It's a great point though, is you're absolutely correct in the fact that you should be able to spend a little bit more apples to apples and have the same outcome. So that's a great point. And that's, I always say there's no way my business would be scalable if I had to go start a new call center in every city and buy new software in every city and new computers and new phones. The fact that we're able to answer the phone, book it, have one controller collecting, or, you know, we've got a collection specialist, we've got all these different people, one SEO department is vital. This is my last question,

then I got a couple of things to close it up. What kind of mistakes do most leaders make when they are trying to scale their business or most business owners? They're doing three things at once to try to scale it. Like they're making three investments in their business at the same time, and they're not letting the profits catch up to each of those. For instance, I'm completely making this up. Hiring two employees, increasing your spend in advertising and buying equipment, whatever that is, right? So all three of those are expenses and the sales might not return as quick as they need to to support the cash spend. So I'd rather do one thing at a time.

Hire the three people, get them up to speed, make profits off your hire, then move on to the next thing and then go buy the equipment. And then once you're profitable on that, move on to the next thing. The mistake that people make is they buy three things at once and they can't recalibrate. It would be like if someone's going on medication, the doctor is not going to put you on whatever, three meds at the same time. He's going to start you with one, see how you react. And if that's good, then they move on to the second one. I never knew I was going to come up with a medicine meds doctor analogy, but I did it. No, it's genius.

I wrote that down. And to me, what I just took out of that, and everybody will pull out the tidbits that they really like, but be profitable in one market before you go open another one because if you could allocate all your resources, all your other markets are profitable, and you've got every resource on that one, imagine what you could do if you just get things done and accomplished and you commit the resources to it. So I think that that was really invaluable. And I appreciate that a lot. So some of the things I close out with is if you could give us one book or maybe a couple that you've recently read.

It doesn't need to be about business, but what would you recommend? Well, my first one is Money You Got this which i wrote it's hilarious it's basically a merger between seinfeld curb your enthusiasm and like my funny crazy life stories so money you got this it's hilarious it's really really good i loved it and then i mean there's so many good ones. Oh, boy. I mean, there's just, I'm thinking of stuff that I'm like, that I'm reading now. I got another one. It's coming to mind, but you get me with your next one because I'm actually going to go they want to reach out to you, I'm going to put all this information on the website as homeserviceexpert.com.

But go ahead and tell me the best ways to reach you and give me a couple of ways to get a hold of you if they want to. Yeah, the first way is to go to this website called cashflowgift.com. Just go there and they'll get like an instruction guide on like two or three things that they can do. Let me just say one thing. Just get one thing that you can implement right away to increase your cashflow. That's cashflowgift.com. They can either find me on LinkedIn under Justin Crane, K-R-A-N-E.

My site is, I've got two different sites. So just go with cashflowgift.com. I'm on LinkedIn. I'm on Facebook. And the name of the other book is called You Squared, Y-O-U Squared by Price Pritchett. Very, very good. What is that about? It's basically like a booklet, basically how to a high velocity formula for multiplying your personal effectiveness and quantum leaps. So this guy is basically taking, you know, short, like things that we've all heard and know, like quit trying harder. Like he'll talk about that or focus on the ends rather than the means. So just really, really simple, like, of course,

but it's the frameworks that he gives, which are really good. Perfect. And the last thing to close it up, if there's anything that we might have not talked about that you feel is important, or maybe some last words of wisdom to close it up on, I'd like you to share them right now. Yeah. I think that it's important for a lot of business owners don't actually invest enough in marketing. And I think somewhere between 10% and 15% of your sales or your gross profits is a good place to start in marketing. And when I talk about marketing, I'm talking about things that will give you a return on your money within a few months, not some big strategy that you're going to launch that's going to make you successful in like a year. So the metric is 10 to 15% of sales or gross profits, and then invest in things that actually will make money and get in the shallow end of the pool, put on your money floaties,

get your like suit in the water, start taking some small risks. You don't have to be big, just take small risks and see how they go and then iterate from there. Yeah. And one last thing I want to just say out of that, Justin, is measure your results. Don't assume. Don't think. Don't go. I'm collecting a – I saw you on a mailer. Have tracking phone numbers.

Have ways to track this down to the detail. Don't assume anything. But that's the best advice I've heard in a long time, because most people say five percent, 10 percent. And if you're going to grow, I say 20 percent. But marketing is the lifeblood of your company. So that's great stuff. Just I really, really do appreciate you coming on. I've got a whole page of notes. I'm going to order the book right now.

To both books, actually. I'm excited to read the one that you recommended that you wrote. And we'll get you back on here soon. And thanks for everything. Great. Thank you so much. Take care. All right, Justin.

Bye-bye. This was the Home Service Expert Podcast. Now, I've got some great news for you. You want more money, time, and freedom? If yes, I put together a free training session where I reveal my four-step process to grow your service business up to eight figures without having to compromise your freedom. Check it out at homeserviceexpert.com forward slash webinar. If you're working too hard and you're not getting results,

you better watch this training session now. Just go to homeserviceexpert.com forward slash webinar.