The Home Service Expert Podcast - Q&A With Tommy - Elevating Your Workforce in 2025

Episode Date: December 27, 2024

Tommy Mello is the author of Home Service Millionaire and Elevate, and the founder of A1 Garage Doors, a $200 million-plus home service business with over 700 employees in 22 states. Through HomeServi...ceMillionaire.com and the Home Service Expert podcast, Tommy shares his experience and insights to help fellow entrepreneurs scale their businesses.  In this special episode of the Home Service Expert podcast, Tommy answers your biggest questions about hiring, marketing budgets, valuation…

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Starting point is 00:00:00 Here's what else I would recommend. Get a org chart printed out. And I want you to put every single person on your team on the org chart. And I want you to rate them one out of 10. I want you to do this in private and with your main leadership team. And if somebody is not a nine or above, then you need to figure out how to top grade them. So I would look into what you're going to do to top grade some of your team going into this new year. And they're not a 10 out of 10, why are they on your team? But are
Starting point is 00:00:29 you a 10 out of 10? See, a lot of times the leaders point their fingers, they should be pointing their thumbs. So make sure you're a 10 out of 10. 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. Before we get started,
Starting point is 00:01:04 I wanted to share two important things with you. First, I want you to implement what you learned today. To do that, you'll have to take a lot of notes, but I also want you to fully concentrate on the interview. So I asked the team to take notes for you. Just text, NOTES, N-O-T-E-S, to 888-526-1299. That's 888-526-1299. And you'll receive a link to download the notes from today's episode. Also, if you haven't got your copy of my newest book, Elevate, please go check it out. I'll share with you how I attracted and developed a winning team that helped me build a $200 million
Starting point is 00:01:40 company in 22 states. Just go to elevate and wind.com forward slash podcasts to get your copy. Now let's go back into the interview. All right, here we go. Tuesday, November. Oh, I was just walking around the block with Ashley. We started doing this thing where I look at my calendar. She goes through the counter every morning, mid afternoon, end of the day, but keep up with all the emails in things really dialed in. I mean, I've never been so organized with my time and it's, it's actually kind of a, the best feeling in the world.
Starting point is 00:02:18 You know, hopefully you guys are finishing up with your budgets for 2025. You set an aggressive budget, but a doable budget. As you guys probably know, most budgets that you guys build, everything on your budget should be based upon things like the bonus structures. So when you got an impossible budget to hit, no one can get a bonus. That's bad news bears. Some of the things to think about negotiating with vendors going into the new year, prepaying some of the marketing companies you use, getting 10, 20, 30% discounts by prepaying the whole year, getting a Wex card for your gas to keep track of it.
Starting point is 00:02:55 So people are stealing gas. These are all things that as you get further along with business, you start to realize, here's what else I would recommend. Get a org chart printed out. And I want you to put every single person on your team on the org chart. And I want you to rate them one out of 10. I want you to do this in private and with your main leadership team. And if somebody is not a nine or above, then you need to figure out how to top grade them. So I would look into what you're gonna do to top grade some of your team going into this new year.
Starting point is 00:03:28 And they're not a 10 out of 10, why are they on your team? But are you a 10 out of 10? See, a lot of times the leaders point their fingers, they should be pointing their thumbs. So make sure you're a 10 out of 10. One of the things I've been working on is not going behind my manager's back and asking for something at a net level down.
Starting point is 00:03:46 I tend to do that because people don't move as quick as I'd like them to move. So what's my answer for that? It's to start getting more people competent to be able to handle multi-tasks at once. Lots of different projects going on in the company. I'm excited. Next year is going to be an amazing leap, leap of EBITDA. I'm predicting a massive, massive growth year. In fact, I feel like I'm very excited just to get the year started. In fact, you know, Thanksgiving is going to be here
Starting point is 00:04:20 at no time than Christmas. And then we'll be in January. I'm just excited to get through this next year. It's a very important year for us. I'm tied up in a lot of construction and different things, but I'm really looking forward to the year. I'm enjoying the process, but I'm excited. Just, it's going to be a lot of work, lots of work, not afraid of work, looking forward to it. So let's go ahead and start asking some questions here. Obviously it's Tuesday. There's not a lot of people on right now. There's about 13, another 16 that they're coming in slowly.
Starting point is 00:04:57 So Victor said, this is a scaling leadership operations recruitment question. How much percentage do you allocate each month on marketing? And what is a healthy gross profit per job? You know, there's some companies that spend 7%. Some spend 10. We spend 12%. When we're growing a market, we'll go all the way up to 30%. So if we're green fielding, I believe it should be 30 or 35% if you want to take market share. That's the question. Most people don't want our kind of growth, so they're not willing to spend the kind of money into marketing.
Starting point is 00:05:31 And most people are throwing money at marketing that doesn't work. They might be doing a lot of TV. They might be picking the right radio and TV stations, but their message sucks. Their brand sucks. They don't have a good jingle. They might have an 800 number that this attracts. It just doesn't incentivize customers to call. They might have a great website, but the website just doesn't load quick enough. So it deranks it. I mean, there's
Starting point is 00:05:55 a lot of things that go into marketing. I don't mind spending over 12% on marketing, but next year we'll probably spend quite a bit more than 12% as a total amount of revenue. But the following year will be less. It's either you're doing acquisitions and borrowing money for those, or you're spending more money in marketing. You got to choose one of those gross profits. They range anywhere from 52% all the way to 70%. I like to be as high as possible. But then you go into this question, do you want a bigger ticket with less gross profit? It seems like the larger the ticket like garage
Starting point is 00:06:30 doors are not as much gross profit as service, at least in the garage door industry. So I got a higher gross profit on service than I do on door sales. Also how much should a flooring company be paying per lead? If my average ticket is $3,800 and my conversion rate is 30%. That's not good. If you think about it, your average ticket, so you're burning leads, man. You're burning leads at 30%. I mean, I'd figure out how to double that into 60%. I'm wondering why it's only 30%.
Starting point is 00:07:07 Three out of 10 clients. That's just a huge waste. Maybe it's your marketing. You're attracting the wrong clients, but something doesn't seem right there at 30%. You know, 3,800 means you can spend $400 to acquire a customer based on my numbers, but that 30% kills you.
Starting point is 00:07:25 Spencer said, what are the most important KPIs for your field managers to understand? How do you use incentivization bonus, your field managers? And on top of all that, what are the most important KPIs and how do you incentivize bonus operation managers? This is a pretty loaded question here. The higher they get to the top, you're looking at gross profit and you're looking at EBITDA. For me, EBITDA is good because that's what we're all going towards is growing EBITDA. A lot of businesses that are expanding and still not sure when they're going to sell, they're reinvesting into the company.
Starting point is 00:08:02 EBITDA does not make sense for management. So gross profit is the best indicator. Gross profit is where I'd be focused on. But there's a lot of other things if you're looking at field managers, you're looking at cancellation rate, that they start on time. Your first job is the only job you know you could get to on time. You're looking at how many reviews. I mean, right now we're only at 24.7% review.
Starting point is 00:08:27 So one out of four get a review. I need to get that past 75%. There's certain things you need to incentivize and get the guys focused on. But the main thing is in the field operations and the field managers is that people are not getting callbacks. They're collecting all the money. They're getting reviews. They're starting their first job on time. They're not calling out on Mondays. There's quite a few things that you're going to want to look at as far as reporting cancellations. Why are we getting cancellations? But I need to see how your company's structured with as far as the org chart and other things
Starting point is 00:08:59 to really give great answers to this. Let's see. Justin said, what is your process for getting a branch manager? Do you promote from within as you have someone that already knows the systems or do you go outside to find a green candidate? We've done both. Number one, is anybody willing to move to that market? Number two, is somebody willing to move up in that market?
Starting point is 00:09:21 Number three, do we have the right person? If now we're going to hire from with, you know, I'd like to move people up from within. I say half of our managers are moved from within half of them came because we didn't have the right candidate to manage. We don't feel like we have to promote from within. We like to give that option. We like to give choices. We like to make sure that anybody could apply for that job within or externally. It's a job that's open to everybody. And we're going to get the best candidate that we feel is going to be able to execute the best. And, you know, I love to tell you, we give a huge leg up if they're internal, but we don't. I don't think that should be the case. The best candidate based on their interview should be the
Starting point is 00:09:58 best. Adam said, after hearing you speak, it dawned on me that every house with a garage door has kitchens and bathrooms. I've been in business for 30 plus years and I feel I have stalled out if that makes sense. We can specialize in kitchens and bathrooms. We specialize in kitchens and bathrooms. How can I scale a want-nature business into a respected size company like yours? Well, I know a lot of billion dollar companies in the home improvement space, the two kitchens and bathrooms.
Starting point is 00:10:30 That's a much larger average ticket by far. I would tell you, if you've been doing this 30 years, Adam, and you're not getting the scale you want, it's systems, man. It's being hungry. I think about work on Saturdays and Sundays. On Thanksgiving, I'm going to be thinking about work about work on Saturdays and Sundays on Thanksgiving. I'm going to be thinking about work. I'm going to be thinking about Legion. I'm going to be thinking about hiring. Right. I'm going to be thinking about how to get more reviews. I mean, I kind of manifesting this stuff. I want to play something by, um,
Starting point is 00:10:57 Earl nine gal and let me pull this, I was listening to this this morning. Let me see. So you guys could pull this. I was listening to this this morning. Let me see. See if you guys can hear this. And finally, the Stranger's Secret. At the beginning I said, what makes a child grow up into the human being he becomes? Well, this is the reason for that. Of course, he's the confluence of a genetic pool that goes back for thousands and thousands of years. His environment has an influence on him, of course. But what makes him become the person he becomes is that he becomes
Starting point is 00:11:35 what he thinks about most of the time. It's a simple- He becomes who he thinks about most of the time. That's the secret. You become who you think about most of the time. That's the secret. You become who you think about most of the time. It's that simple. And I think people just don't think they're worth it. They don't think they have a good business.
Starting point is 00:11:52 They get burnt out. They just get burned. They just get worn out. They get the leathery skin that's rough. It just stops trusting people. And I get that. I do. I just, I dream too much.
Starting point is 00:12:06 My dreams are just so fluid. I dream and I take out my calculator and I write down the math and I go, why not me? And I go to a lot of shop tours and I meet a lot of people and I'm like, I can do better than that. Like I walk in and I look at shops, how much do they respect themselves? How organized is the place? How much systems are they working on? How powerful are their meetings? What's their mutual respect like? And I go, man, we're better than that. I mean, look, end of the day, there's no reason that,
Starting point is 00:12:38 I don't think anyone could be, you know, tens and tens of billions of dollars, the valuation. I just believe that. So if you're dreaming about getting to a hundred million and I'm dreaming about getting to a hundred billion, who do you think is gonna win? I could fail miserably and still be way bigger than most. Davis said, we've been running our junk removal company here in Charlotte, North Carolina for six plus years now.
Starting point is 00:13:04 Low AGS, high volume type biz, same next day bookings, minimal reoccurring money, a lot of junk providers here, Google ads are as expensive as ever. Is this business industry one we should continue to try and scale or pivot to a new service? If stay, should we continue to try and scale or pivot to a new service. If stay, should we continue to try and capture more market share here in Charlotte or expand into another city? Davis, I would tell you man, I've got 500 competitors in Phoenix,
Starting point is 00:13:36 my average ticket's less than $1,300. If you think that it's your industry or it's the competition, I just don't believe that. Of course, getting into a high ticket average, high average ticket makes a lot of sense. You got to look at it. I think take as much market share as possible. Charlotte's a booming market, man. You know, you could go learn a lot from my guys over there at Morris Jenkins.
Starting point is 00:14:01 I would say you take as much market share as possible before expanding. You might think, oh man, I should go to another market. I could buy cheaper leads. You want to stay in your market and you want to figure out a way to get different types of leads. Get with realtors, get with hoarders, you know, get with the over. There's so many get with the auctions, the courthouse auctions, so much opportunity. You got to think outside of the box. You need to turn yourself Davis into a lead gen machine. Start reading books on lead generation reviews,
Starting point is 00:14:31 how to get a higher quality score on paper click, lots of things, how to do search engine optimization, how to get the best brand, how to make a TV commercial that's memorable, how to get the neighbors work, how to get with HOAs, like so many ways, so many opportunities. It's not your market and it's not your service line. So many people think that they say it's just, if you're not successful in one thing, what
Starting point is 00:14:53 makes you think like somebody's making a shit ton of money in that industry. Someone's making an ungodly amount of money. So I don't think you're going to have a better luck by switching industries. You're going to notice, oh man, there's just as much competition. It's kind of like when you buy a brand new car out of the car lot, you're like, nobody has one of these. And then you drive off the car lot and you see 10 of them drive by the same color. And you're like, oh my gosh, this is crazy.
Starting point is 00:15:20 Same thing happens when you switch industries. Nick, I own a window washing, pressure washing and Christmas light business, and do about 1.25 million. We are growing very quickly, but I'm wondering if I'm playing in the wrong game. Our average ticket is $1,000, which is good for the industry,
Starting point is 00:15:40 but awful compared to some other home service industries. Easy answer is just switch industries, but I'm 25 and I'm afraid to just throw this away. What would you do in this situation? They exactly what I would do. Nick, you're at 1.25. I'd run this up to $3 million. I shoot for a 25% of the bottom line. That gives me 750 K. I think at that size business, I could demand,
Starting point is 00:16:08 you know, let's just say 6X. So that would give me about $4.5 million. I'm a happy camper at $4.5 million. Then I can go start another thing. I can buy the house of my dreams and help my parents out. I can get married. I could have enough money making money. You'd have enough money to invest. So I'm making compound interest on that money. And I have a lot of money to go start another career. So I would not give up the 1.25. You're too close. Why not just get it to 3 million at 25% walk away with $4 to $5 million. Now if you're making 1.25 in revenue, but you're taking home less than 10%, why? Why do you do all this work? I mean, you pressure wash, you window wash, you do Christmas lights.
Starting point is 00:16:57 If you're not making a huge margin, I'd like to know why. If you can't hit 25%, why? Steven said, do you have any advice for a person who has a full-time job while trying to grow a home service company part of time? What's the right way to work towards getting off the truck while retaining a full-time job? I'm a public service employee that works 14 days a month in my regular full-time job with a window cleaning and power washing business on the side. I know I have to leverage time, money,
Starting point is 00:17:29 and people to move the needle forward. I am close to accomplishing my goal of 100,000 in revenue for 2024. And I wanna continue to grow the business. I have six years until I can retire with the public service benefits and paid healthcare. So it doesn't make sense to leave my full-time job close to retirement. I think it's really hard, man. I think it's hard to have a full-time job. You don't know enough about the business. You're doing it part-time. So as a part-time
Starting point is 00:17:54 person saying, Hey, I want to hire somebody, but I'm not going to be available for you. I think that's kind of a catch 22, right? Hey, son, come over here. You're going to do this job. They're going to do this job. They're going to go, well, why don't I just start a job on the side? Why don't I do this? It's a tough situation. I don't know what I would do. I personally, I mean, this is just me six years until I retire for public service and benefits and healthcare. I don't know. I weigh out my options, but I'll tell you this. If I was in power washing, window washing, I just, I haven't seen many businesses that actually make a killing. I just have it.
Starting point is 00:18:30 I've seen businesses that clear like a million bucks a year, but they spent 20 years doing it. I mean, the juice isn't worth the squeeze for me. It would kind of be like you're mowing lawns. It's equivalent to that. You're mowing lawns on the side when you're not working your public job. So I don't know. I don't have the answer for this one. I would tell you, I try to figure out a way to make at least six figures. Then I could pay for my own healthcare, but I don't have the perfect
Starting point is 00:19:01 answer. I'm sorry, Vivian, what are your top three non-negotiable priorities for the first year business owners? Like if you were to start a business with absolutely nothing but knowledge and determination, what would be the three things you would do immediately? Number one, well, I get a part-time executive assistant. I would get a probably a assistant, I would get probably an EA from the Philippines. And if somebody helped me manage my time, come up with SOPs, build manuals, standard operating procedures, edit videos. What I would be doing is I'd be spending all my time meeting people. I'd be out there creating the business, getting reviews, doing cheap work to get reviews.
Starting point is 00:19:42 I'd be getting hundreds of reviews a month. I'd go out there, I'd do the work myself. I'd try to do 10 jobs a day. Reviews, reviews, reviews, long reviews with pictures in them, HOAs, I get to know the realtors. I'd be meeting people in between jobs. I would be hustling. Like you've never seen, I'd be getting yard signs.
Starting point is 00:20:02 This is what I used to do. I used to put out a hundred yard signs a day. I used to go run as many calls as I could by myself. I used to work nights, weekends, holidays. I used to go to B&I meetings, all of them. I used to go to chamber meetings. I used to stop at realtors and bring donuts and cake and you name it. And I'd meet people and I'd meet them and I'd meet and I'd meet and I I meet them and I meet and I meet and I meet
Starting point is 00:20:26 and I didn't just get one review I get one on the BBB I get one on Google I get one on next door I get one on Angie and get one on Yelp but get a video testimonial I was getting video testimonials before you had a camera in your cell phone used to be this little memory stick you stuck into your camera and you had to pull it out and stick it into the computer. That's how long ago I was getting videos before videos were a thing. So that's what I'd be doing. David said, I'm starting an HVAC business.
Starting point is 00:20:53 Can you share what bookkeeping accounting software you use? I want something that can scale, yeah, Intact. Intact is the best one. It's light years above QuickBooks. And as the company grows, you're gonna wanna use Intact. That's the right one, David. All right, lots of questions here. So the fiction book I wrote,
Starting point is 00:21:14 we didn't feel like it was good enough. Me and my team were working on it. We didn't feel like the ADH book for kids. It's done. I was writing it. my family read it. They told me it was magnificent. I'm not gonna put out a book that I don't think is a 10 out of 10.
Starting point is 00:21:33 So we were kind of going back to the drawing boards. We are working on some new books, but that one is kind of paused. Which business coaching programs are the best? And is there a way to monetize the data in our CRMs outside of our business? Which coaching programs are the best? You know, it depends on what size you are, Josh.
Starting point is 00:21:56 I think there's different size coaching programs. There's a lot of great coaches out there. You know, I try to hire specialists. I try to find somebody that's going to be like, for example, bring them with power sign pros. He's focused in the call center. I try to bring in specialists to work on stuff. Right now we're working with Cameron Harald. He wrote the book double double and meetings suck. You know, I work with Dan Martell, and then I'm going to ask these guys who the next coach
Starting point is 00:22:25 should be. I try to work with someone for a year and a half and then I go on to the next coach. I try to extract as much as I possibly can and then go on to the next coach. And then I hire specialists all the time, like all the time. I hire a lot of project specialists too. Someone to build out like the best PBC campaign. And then I get it audited by another third party. Like I'll go to Upwork or Fiverr or all these other, like I'll find the best of the best.
Starting point is 00:22:52 I tend to hire consultants that do the heavy lifting and then teach us how to keep it implemented. Do you have an example scorecard for techs and CSRs? Jim has all this stuff. If you just hit us up at homeservisexpert.com forward slash questions and ask for that we could send you that. Kurt said we are rebranded with Kick Charge that just ordered out Levy manuals looking for the right business coaching group next to help with budgeting and financials. What group would you recommend? I mean selfishly I'll
Starting point is 00:23:24 just tell you Home service freedom, I think Gianni, Jim, Britt, we've hired another 20 people. I know the programs out there. I do believe that our program gets results. It teaches you how to do this stuff. We learned from Alan Roar and Al Levy, but there's other good programs out there. There's Breakthrough Academy. I think there's a pretty good job, depending on your industry. I think, does a pretty good job depending on your industry. Nextdoor does a good job on HX Plumbing Electrical, depending on how much you want to spend, where you're at in the business, how big you're trying to get it, what things you need. It's a pretty loaded question.
Starting point is 00:23:58 I'm in a $5 million EBITDA retail roofing business. Another $ 5 million under LOI. Would you sell once the acquisition is done? What multiple would you assume applied to the 10 million in retail roofing EBITDA of 29? Sam, very impressive. So when you buy a company that's just the same size as you, one of two things can happen. If I buy a company that's just the same size as you, one of two things can happen.
Starting point is 00:24:26 It can go integrated properly and flawlessly. Hard to do because there's probably an infrastructure you're taking on. So who's the CFO? Who's the VP of marketing? Who's the HR team? Who's the recruiting team? What systems are you using?
Starting point is 00:24:43 How's it all rolled up? How's the database compiled? Let's say I'm an investor, Sam and I wanna buy this business. I'm gonna say, did Sam grow the EBITDA the first six months? Did it go from 10 to 10 point, obviously it would be 10 million a year of EBITDA comes out to like 825,000 of EBITDA a month. Question is, did you get to 830, 850, 870, 900?
Starting point is 00:25:11 So it's all about the integrations. No one's going to pay you a top multiple until that's integrated. You're just not going to get the same credit for it. But for a roofing company, the other question I have is, are you over 15% profitability on revenue? But I'd say, you know, are you under 25? Cause if you're like 40%, there's something stinky about that. How old is the company? How many reviews you're going to do? What's called a SIP CIP on it.
Starting point is 00:25:40 If you hit me up, I'll give you a couple of people to talk to that know more about it than I do. If you hit me up, I'll give you a couple people to talk to that know more about it than I do. But I would think the business would be worth a minimum of $120 million. What do we for advertising on plumbing? We try to add local services. The only thing that works is SEO. I mean, I think the GMB is probably the best thing. The GMB works really, really well when you get reviews. Miguel, I would say call Kellan. I always tell you Pin Parrot. I know what he does with people and it's freaking fantastic. It's pinparrot.com. You call him up, you're going to have to get a lot of reviews. You're going to have to do some onsite SEO stuff,
Starting point is 00:26:26 but he'll get you ranking. He'll get your lead flow double and tripling. I mean, if you talk to anybody who's used it, if anybody on here has used Kellen, tell us what your experience has been, tell Miguel, because I've not talked to anybody that he hasn't been able to change their reviews dramatically. I use them at a one on every single one of our locations.
Starting point is 00:26:49 Whoever just asked the nine to five question, my answer is make sure you're not wasting any time. No TV, no video games, no parties saying no to everything. You know, Ronnie, I agree with that to a certain extent, but it's kind of like having a cheat mill. You're allowed to do some stuff. Ronnie, I agree with that to a certain extent, but it's kind of like having a cheat meal. You're allowed to do some stuff. I mean, make time, enjoy the journey. Yes, it's hard work.
Starting point is 00:27:11 Yes, put your head down, but don't burn out in a way that's not healthy. Don't ignore your family. Try to make time to have a beer with a buddy or two. I like the idea of hard work, discipline, delayed gratification, put your head down, work 80 hours. But you gotta make some time for certain people. You just, it's not healthy.
Starting point is 00:27:31 What was one of your biggest, I should have done this sooner moments? Matt Lewis, great question. So an executive assistant all day long should have done this sooner. There's always two or three people at the company that you know you have to fire. So an executive assistant all day long should have done this sooner. There's always two or three people at the company that you know you have to fire. In a perfect world, you're still holding them. Bam. Should have done it sooner. Everyone will perform when that person's gone, you know, especially if they're in a leadership role and they're just a plague. Should have rebranded earlier. Should have bought new trucks earlier. I should have bought a building earlier. Oh, you know, the right CFO with the right controller
Starting point is 00:28:11 and the right FP and a team. I think everybody needs to hear that. You should rewatch that the right CFO that understands everything that goes on. Listen, if any of you guys need help signing up, finding a CFO, my CFO is part of a group of 100 CFOs. They got, they just know everybody in every single market. If you're a million dollars, you're probably not ready. You need some fractional. But if you're a larger business, just hit me up at homeserviceexpert.com forward slash questions. Adrian's always willing to help. He kind of likes helping.
Starting point is 00:28:45 I own a home inspection company and want to come get my team trained at your training facility. I have 25 inspectors. Yeah, Dylan, hit me up, man. I'd love to show you guys how garage doors work all day long. I love opportunities like that. I have a landscape company with 130 plus reviews with photo videos, but recently Google suspended my profile for no reason.
Starting point is 00:29:07 No one knows how to navigate this process. Any person I can hire. Yes, I know a few people. Josh hit me up at homeserviceexpert.com for such questions. Tommy Mello from Instagram. Dallin Cole music. Hi Tommy. from Instagram. Dellen Cole music, hi Tommy, as someone who is wanting to transition from corporate America to owning a home service business,
Starting point is 00:29:31 are there options for small business loans that I can use? Yes, there's a guy named Kyle Malien, M-A-L-L-I-E-N. He's an expert at that, Kyle Malien. If you hit me up at homeserviceexpert.com for such questions, I can get you his information. He understands an easy way to make that work. Did 2.4 million this year, 8% net profit scale or retry in 2025 at same size? My general rule of thumb is never make less than 10%. You're not far off, but there's some type of money you're bleeding here. I had raised my prices personally by
Starting point is 00:30:12 10%. You'll lose 20% of your accounts, but you're losing the stupid ones. I would see how much more I could sell to the current ones and make sure I'm not wasting time driving, make sure my capacity planning is dialed in. I just try to tighten everything up because I'd like to see it hit 3 million next year at like 12 or 14%. Trust heating and air. Going live with ServiceTitan next week, who would you say has some of the best help with some of the setup for the best efficiency when it comes to memberships. And some more important parts of Titan. Lance Bachman owns a company that does pretty good job of training on service Titan. We actually have a guy too at Barrage Door Freedom, his name's John. You give me a list of everything you need at homeserviceexpert.com forward slash questions.
Starting point is 00:31:04 Just give me a list and I'll see if I can get you answers for everything. need at home service expert.com for slash questions. Just give me a list and I'll see if I can get you answers for everything because service is an animal. It's a great, amazing, bad-ass animal, but it's a lot of work. What are your top five books to read if we are a roofing company around 2 million? All right, let me think here.
Starting point is 00:31:25 Go for no. What should we do by Joe Crisara, the seven power contractor by Jim Les, or Al Levy, branded not blended by Dan Antonelli. And I would probably read who, not how at that size. I think the question is you're probably trying to do too much. I'd also read the Michael Gerber book, Emit revisited. I think another good book I'd probably added that list just the fundamentals is Napoleon Hill thinking grow rich and Dale Carnegie,
Starting point is 00:31:59 how to win friends and influence people. Yeah, I mean the goal is to work in systems and processes and hire the right people. You do that, you're gonna scale. My whole life is thinking lead generation, build a great culture and recruit great people. If I do those three things and have a really big vision and dream big, the company's scaling and growing, that's it.
Starting point is 00:32:23 Yeah, so if you wrote a book on home service and you wanna send it to me, you could just look up A1 Garage Roors in Phoenix. The address is 3254 East Broadway. So 3254 East Broadway Street, Phoenix 85040. I believe you could look it up on Google, just put A1 Garage Roor service.
Starting point is 00:32:42 It should be that one. Or you can hit us up at homeservisexpert.com forward slash questions. Harrison Reese said, Tommy, I have only heard you discuss the residential side of business while listening to podcasts. How much commercial work B2B makes up your total revenue? Zero. Is there a key difference when it comes to lead generation for commercial clients?
Starting point is 00:33:06 Absolutely. Only have been utilizing cold outreach and dials for B2B lead generation. Curious if you have any book recommendations for creating B2B sales machines. You know what's funny is I was reading a few books on my shelf yesterday and I had some stuff for B2B. I don't have them on the top of my head, but it's like B2B sales.
Starting point is 00:33:29 You know, Jeremy Miner does a great job. I think Jeremy Miner does one of the best I've seen it do in B2B sales. I don't know. It's not that I don't believe in B2B sales. It's just, I've never had to do a whole lot. I've done some of it with software. I think the goal is to bypass the, the, there's always someone, the gatekeeper, bypassing the gatekeeper and it's just getting them excited about your products, showing them how much
Starting point is 00:33:53 ROI they're going to get. I understand it, but we're not, it's not what we focus on. How do I visit a one? Go to a tommymllow.com forward slash shop. S H O P. When are you going to start the home service company version of the bar rescue show? I think Victor Rancor was doing that.
Starting point is 00:34:16 I'm going to focus, you know, we're going to come out with a new channel where I'm going to go talk to people with badass garages and we're gonna make over their garage and it's gonna be badass and some of them are gonna be wealthy. Some of them are gonna be famous. Some of them are just gonna be really cool business owners.
Starting point is 00:34:35 Where I'm gonna ask great questions. It's gonna be long form and short form. And we're gonna highlight some of the curb up hills, some of the cool things because I'm doing this number one, to get educated myself and get connected. Number two, to recruit people, and number three, to become the Richard Rawlings
Starting point is 00:34:52 of garage drawers. He does high-end cars, hot rods. I want to be the guy that if you wanna order 20 garage drawers, we're gonna come in, we're gonna do it on time, we're gonna do it on budget, we're gonna do it quality, and we're gonna make you famous because We're gonna do it quality and we're gonna make you famous because they're a YouTube channel So I'm already looking at ways to use social media To help the core business and I think that's what you should be thinking about, too
Starting point is 00:35:14 What revenue per location market would you look for in a window cleaning pressure washing? I mean, I'm the type of guy where I think you should own the market. So you should be getting millions of dollars I mean, I'd rather you not have a lot of locations, have one doing a ton of money. There's no strength of having a lot of small locations doing a little bit of money. I think that's where people get it wrong. They treat their business like it's a Taco Bell. We should be in the low single digits. It's a completely different animal. Take as much market share as you can in your current markets. Own your market every one you go to. I wish I would have known this going back. I would have said, before you own this next market, there's some advantages of growing
Starting point is 00:35:57 because there's low hanging fruit. But I will tell you, I would want to own every market as much market share as I can. That's a hundred percent. Yes, Tim. We got you. We'll hook you up. We'll get your garage door fixed. How much you benching these days, bro. You look and squall. I'm doing incline now with over 300 pounds, which is pretty exciting. That's a lot of weight. I started taking the stuff for my tendons and what is it called? It's just over the counter on Amazon. I drink the liquid form. It's called a glucose to me, condroid it. It's a game changer. With your power, at least in AZ, why don't you open a commercial division? And also why aren't private equities interested
Starting point is 00:36:47 in people that do commercial? They are, commercial is a great opportunity. A lot of people love commercial. We've talked about doing commercial, but what I've learned is to be hyper focused. What's easier, me to do commercial in one market or me to scale my residential where I've got the buying power, the performance pay, the manuals, the training center, the recruiters. Your accounts receivables different. There's so many different
Starting point is 00:37:11 things. Your vendors are different. The trucks are different. So this is where focus comes in and this is where I think most people completely fail. Almost all people, most business owners and the vast majority of them, they go, yeah, we could do it. So we should do it. That's just not the case. Like what's faster. Look, I'm only in 20 states. There's 30 more states. There's a lot of cities and states that I'm not in yet. I mean, think about it. There's St. Louis, there's Chicago, there's the all of California, there's Seattle, there's Dallas, there's all of Florida except for Orlando. There's so many markets. I'm not at all in
Starting point is 00:37:50 the Northeast. It just goes on and on and on the opportunities. I'm not in Louisiana. We're not in Arkansas. We're not like, there's just mucho grande opportunity. So I would say, I just don't see a reason, not saying we won't because we know how to chew gum and walk at the same time. But right now it's not the right thing for us to do. What do you look for when hiring a sales reps? You know, I look for eye contact tonality. Do they tell a great story? Is this somebody I'd want to invite into my mom's house to do the work on her home? Is this somebody I'd buy from? Do they have a great story? Is this somebody I'd want to invite into my mom's house to do the work on her home? Is this somebody I'd buy from?
Starting point is 00:38:28 Do they have confidence? Do they have a sense of humor? Really eye contact's a big one. You know, do they talk like they believe in themselves? I want to know they love themselves. I want to know that they care for themselves. I want to know that they want more in life. I want to know that they have responsibilities that they need to work.
Starting point is 00:38:47 And they live with mom and they're like, yeah, I'm happy. And I'm just kind of deciding what I want to do with my life. That person's not for me. How did you determine sales reps territories in your market? How do you get them not to compete for leads? Well, what I can tell you is you um, you want to stack the deck with your best players, right? So you want to give the top guys the most leads and everyone's got a scorecard.
Starting point is 00:39:17 And now the AI kind of handles it. Dispatch pro, but you know, we don't have outbound door knockers. We don't have that kind. People call us up. We don't have that kind. People call us up. We have great people in every market and every quadrant of the market. And I'm not fair. I'm not fair with the way we dispatch.
Starting point is 00:39:34 I'm sorry. I don't think any coach is fair with the way he starts the offensive and defensive line. I don't think any baseball, football, soccer, I think you put first string in first. I think the people that show up for practice, they spend the most time, they get the most training, they score the most goals, they defend the best, they get to play the most. I'm sorry. That's the country we live in. I believe that's the best thing to do.
Starting point is 00:39:59 I don't think you should say everybody gets a fair chance. You should say if you want a fair chance, I will pay you unlimited money to come back for training. I will continue to make you the best you could be. But you got to want it too. And I think this is where most people screw up. All of my technicians and installers get lots of jobs. And by the way, the client called us something broke.
Starting point is 00:40:23 It's not like we're just randomly showing up at someone's house with the garage or not broke their garage or is busted. Something's wrong with it. So there's no job. That's not a good job. We do have a small door to door program. We're just getting started with it. Lenny Gray handles that the door to door millionaire.
Starting point is 00:40:40 I think he's the best in the game. Lenny Gray, appreciate him. We're trying to work on this program to make it some money. The main thing is we get our best in the game. Lenny Gray, appreciate him. We're trying to work on this program to make it some money. The main thing is we get our sticker in the garage. Not a lot of money up front, but we're working on ways to make money up front. Used to work at A1, now the life insurance industry trying to scale a team. What's the biggest tip to growing team culture and developing as a leader to growing a team culture. I think if you're going to develop as a leader, you need to be around other
Starting point is 00:41:08 leaders, just like, if you want to be a great dad, you got to be around great dads, just like, if you want to be a great husband, you got to be a great husband. If you want to be a great son, you got to hang out with great sons. If you want to be wealthy, you got to hang out with wealthy people. It's kind of like a hack that works every time. You want to get good at shooting pool, hang out with really good pool players. You want to get really good at soccer, get some condition tree training and hang out with great soccer players. Like it works every time you want to get great culture, find the culture you want to hang
Starting point is 00:41:36 out with and go find a mentor. That's what I would tell you. Usually you got to build the culture. The culture will build itself. What does that mean? If you don't have an intentional plan to build a culture, do stuff outside of work, have ceremonies, have meetings that matter, have fun stuff that happened outside of work, just simple as going to a park or eating together, it's really hard to win. Thank you. The home service expert link isn't functioning at the moment. Is there another link for asking questions?
Starting point is 00:42:07 Oh, how is that possible? Oh, I threw in there something at the bottom. It's my Gmail address. You can send stuff there. Best trade shows for your industry. I mean, there's a lot of them. I have a good show, HSF, Home Service Freedom Group. Julian does for Next Star Network, the once a year. There's a lot
Starting point is 00:42:33 of great home shows actually, for all of the home service companies. I can get you a list if you hit me up. There's a lot of them. I'll tell you, the guys at Sherp do a pretty good job. They know all the best ones. Any one of our vendors at HSF could tell you what are the better shows of what are. I'm in Louisiana. Come on over. I am Kyle Maylian's group and recently bought a plumbing biz.
Starting point is 00:42:58 Great job, Kristen. That's great to hear. I recall you mentioning that you were going to create an auditing team to audit your team on all things in the business. Did you get that implemented? How did it work? We've got a data integrity team. Yes.
Starting point is 00:43:14 I mean, look, we've got software running in the background of every call, every call center, every dispatch. We are looking at everything, not every single job, but I'd say one out of 10, we're listening to the guys in the field. We use software like Rilla Voice to be able to know what's going on in the garage. I mean, yes, there are monitoring after monitoring after monitoring. And that's really to make sure our data is accurate and to make sure everybody's pushing themselves to the next limits. First, we want to make sure you got a big dream.
Starting point is 00:43:45 Then we want to make sure you reverse engineer the dream. Then we got to make sure you know what needs to happen in order to hit your financial goals of your dream and what is happening at work. And a lot of people don't start with this. They don't even know where to start. Like, first of all, tell me what your goals, your dreams, what do you want out of life to want to buy a car, you want to buy a house, buy wind. Then we can start reverse engineering to what needs to happen at work. And it's
Starting point is 00:44:07 something we're still working on. We're not where we want to be with that, but it's coming together very nicely. Yeah. Set up a meeting, Sun deep. I'm always willing to learn more about Legion guys. I got to head out here. I appreciate you guys. Lots of great questions here. Seems like I'm, um, I'm pretty much caught up with this, but I appreciate you guys. Lots of great questions here. Seems like I'm, I'm pretty much caught up with this, but I appreciate you guys. I got a slam day the rest of the day. I love doing this stuff. You know, I'll get the questions. It's homeserviceexpert.com for slash questions. If that's not working, it'll be up by tomorrow. Is it up? It's working. So use that link and we'll go from there.
Starting point is 00:44:47 And I appreciate you guys. Hopefully you're finishing up those budgets. You got some big dreams, big plans. You want to make the business work. One of the things we did, I think we, you know, we added a lot of money to different types of salaries and opportunities and to pay people more knowing that we needed to recruit the next level of people and knowing that certain people,, knowing that we needed to recruit the next level people and knowing that certain people,
Starting point is 00:45:06 we don't want them to leave. So how much did you build it in your budget for giving more to the current people? Now you might say I'm barely even profitable. Well, that's on you. I don't think you're charging the right prices if you're barely profitable. Is there companies cheaper than us?
Starting point is 00:45:20 Yeah, there are some cheaper than us. Are there some more expensive? Yeah. Do we give options? Yeah. Do we train our people? Yeah. There are some cheaper than us. Are there some more expensive? Yeah. Do we give options? Yeah. Do we train our people? Yeah. Do we make sure the customer is happy? Yeah. There's a lot of people on this call, I'm sure, still making it about price. And you shouldn't make it about price. It's not about price. It's never been about price. It's about the investment. If you could stick to those and understand it's always been about the investment, not the price, you'll go a lot further.
Starting point is 00:45:46 I hope you guys have a great Thanksgiving and I'll see you guys soon. Thanks guys. Hey there. Thanks for tuning into the podcast today. Before I let you go, I want to let everybody know that Elevate is out and ready to buy. I can share with you how I attracted a winning team of over 700 employees in over 20 states. The insights in this book are powerful and can be applied to any business or organization. It's a real game changer for anyone looking to build and develop a high performing team
Starting point is 00:46:16 like over here at A1 Garage Door Service. So if you want to learn the secrets that help me transfer my team from stealing the toilet paper to a group of 700 plus employees rowing in the same direction, head over to elevateandwin.com forward slash podcast and grab a copy of the book. Thanks again for listening and we'll catch up with you next time on the podcast.

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