The Home Service Expert Podcast - Q&A with Tommy - Getting More Lean and Efficient to Keep Up During Tough Times

Episode Date: July 22, 2022

Tommy Mello is the author of Home Service Millionaire and the founder of A1 Garage Doors, a $150 million-plus home service business with over 400 employees in 16 states. Through HomeServiceMillionaire.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 sales, marketing, recruiting, creating systems, pricing...

You wonder why you're getting bad people when you go to the unemployment line. It's amazing to me. Why not find somebody? Why not get every one of your employees to go online real quick and say how much they love working with you? Why not tell them, listen, if you get somebody through your portal, I'll give you a thousand bucks. I get 1500.

Why not continue to think about ways to drive in amazing people that already have jobs that will make the switch? People are like, no one wants to work like they used to. Trust me, the people that want to work are still at work. The people that want to work are still at work. You got to get them to make a switch. I think that's a big deal that people don't understand. 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. Let's get started here. Number one, if you haven't heard of my book, I don't know what to say, but it's called

The Home Service Millionaire. Go to homeservicemillionaire.com forward slash podcast. And then I have a course, The Home Service Millionaire course. You can buy it at course.homeservicemillionaire.com. And if you haven't joined our free Facebook group, go to Facebook and look for Home Service Expert Group. And I also recommend if you are a garage door guy, go to Garage Door Freedom. There's a free page and then there's a membership page. Just go to the free page. You'll see that we're going to be posting lots more content. I've got a lot of questions here. I'm going to go through what is new here at A1. Let's go through a few things. Home service freedom is the mothership to garage door freedom,

and that's growing dramatically. Vertical track's going to be October 12th through the 14th. We had everything from window washing, power washing. We had over 300 companies. It was absolutely mind-blowing what people took from it. I ended up getting 40 testimonials. People call me back. They said their technicians have never been happier. Their meetings have been more productive. Their CSRs are booking more phone calls.

They're able to recruit more. They're understanding a new level of what their CRMs can do. So I'm pretty excited just because these events are going to get better and better. I want to get the next one into a really big situation where hopefully we're like a thousand people. It's going to be in Phoenix. It's going to actually be in Chandler. It's a really affordable hotel. It's called Wild Horse Pass in Chandler, October 12th through the 14th. It's going to be a game changer. I promise you guys. I'm going to be opening up the doors here day one, showing you our training center, all the new technology we're building. Just understand

really what's going on with the company. And Garage Door Freedom is amazing. Some of the stuff, some of the breakthroughs that people are having. So let's go through and answer some questions. I've got some people on here. I'm an electrical contractor from Los Angeles, California. I started hiring around the things that are pulling me away from focusing on the business. Yeah. If I could talk to any business owner, the first thing I say is what's eating your time. Let's go there first. Really try to find someone good for an assistant. You know, it's interesting. I just got done working out about 45 minutes ago and my trainer said, there's a thing called Be Organized with two E's, B-E-E-Organized.com. We're hiring them for the house. I might even get them here day one,

but we're going to hire them. Just getting ready in the morning, the way you do your laundry. There's a great book called Two Second Lean, and he talks about how he mixes the salt and pepper so he doesn't need to use two shakers. Now that's a little overboard, but I will say anything you can do to become more efficient and efficiency is something we talk about a lot, becoming more efficient with your time. We've got an interview with a full-time chef tomorrow to help at the house and here at a one. So I'd love them to be able to cook here as well as the house and I'll prepare

meals, really set us up. Correct. Time is money and how much time you have to do the bs so you're absolutely right i have one service van three installers what are other strategies i can do beside marketing through different platforms online bni groups uh business network international there's a lot of things online. We just started with these flyers right here. Rouser problem flyers. They're like 40 cents, something like that. And they've got a really good ROI, actually better than pay-per-click. So these are some of the flyers. This one is 520, so Tucson. This one's 505, so Albuquerque. You can see right there where it says Albuquerque versus South Saravista.

So pretty cool thing. It's right on brand. It's important to be on brand. Mike Strange had a question. I'm new into our pressure washing business and think I've hired an ops manager soon. Too soon. Should I rather have an office manager and build out there? So you think you've hired an operational manager before the office manager? Yeah. You know,

when you're smaller, I do think the office manager making sure the small things are getting done, like ordering uniforms, making sure that the license plate and the licensing is correct. But I think that's more of an assistant. So I would say an assistant is going to try to get the day-to-day going. The operational manager is like working on the CRM, the price book. And if you're only three or four guys, it's really hard to want to do that. So I understand where you're coming from, but hopefully you have enough money to be able to do both because they're both going to be working in different directions. So it'll just help grow you faster. Jennifer Willis said, how do you transition technicians to team leaders, trainers,

and leaders? That's a great question. And we're actually working on leadership training and we're actually working on leadership training. And we've got what's called a dream manager. But what we'll also do is tell them to read books like How to Win Friends and Influence People, Rich Dad, Poor Dad. We try to make sure their personal finances are in order. We try to make sure they're saving money, get them into home ownership. When people are listening,

they're in the Dave Ramsey program. They're actually learning, they're mentoring. They do great ride-alongs. They're patient. They follow the manual. They understand why the checklist exists. Those are some of the things that you could tell when they come to you and they ask you for more. They're usually smiling. They've got a great attitude. You hire for attitude. You train on the job. So really what happens is the size I've been now that they've actually come and asked for it, but there's certain things you could do in the interview process to help qualify those things. As simple as, you know, I was on the, I was vice president of our class in high school. You know,

there was some attributes that would definitely point towards leadership for a lot of the people that I've seen and brought on for leadership. And some of it might just be some stuff they did in high school where they the captain of their team. This weekend, I had to let go of an employee. She knew it was coming. She's a family friend. It was tough, but a huge relief experience that. It's the worst thing in the world. It's almost like getting a divorce when you have to get rid of somebody like that. It's so hard, but it needs to be done. It's not fair to the rest of the people. So, you know, fortunately, I've been able to guard myself in the last 10 years from having to do much of that. But yeah, I mean, it gets tough and there's tough decisions that need to

be made. But these tough decisions are what kind of build us into leadership. And I think the best thing I've ever learned was try to get people to present to me. And I use a form. So this form, it says, who did you spend time with this week or significant activities, observations, insights, or ideas on a scale from one to 10? How would you rank your performance on a scale from one to 10, how would you rank your performance? On a scale from one to 10, rank your direct reports performance this week. Well, what core values did you exercise well this week? What did you do this week?

What did you do well this week? What can you improve upon next week? What is the most important decision you're facing? What is keeping you from making it? What help or direction do you need? What key activities or priorities are you focused on next week. The reason why I think that this is so important is because when they start learning to have one-on-ones with you and actually they get with you guys to present well, when you have to fire somebody, they should know it's coming. You're letting them know you they should know it's coming. You're letting them know you're letting me down each week. You're not hitting your goals. You're not making your priorities. There's confrontation. And rather than letting it build up in that bottom

shelf, it becomes a little bit easier. So I would say a lot more one-on-ones, a lot less team meetings is the biggest thing I would say to small companies, because it seems like small companies, they only have team meetings, never any one-on-ones. I think that's a huge, huge mistake. Do you have your installers wear their bottom-up uniforms while installing the garage doors? No, my uniforms are not. They're pretty lax.

I mean, it's 115 degrees here, and there are times it's zero degrees. This is the shirt you wear, but you've got special jackets and special gloves and hats, and everything's A1. It's all the same logos. I know what you're talking about. That's more for plumbing. We don't make our guys wear that. Do you think your website should have an individual page for each service you offer?

How strategic are you on adding keyword phrases to those pages? Yeah, our website's thousands of pages. You should actually use Google Analytics, find out what people are searching, and have dedicated pages, even city pages, for that matter, for that. I mean, SEO is the world. It's where people go when they need something. So link building and content creation being done is absolutely crazy to me to not do it. Mike Haddad said, you mentioned in one of your videos that you were expanding your business in other towns. Are those employees, subcontractors given one of your truck vans? Yes. Right now we're in 28, 29 markets, 18 states,

and they all get my trucks. They're not 1099s. They're all W2s. We crossed the 500 mark. We're looking to partner with other garage door companies. There's a pretty big list of companies that want to partner. We're going to do the things that they kind of hate, like hiring. We can still get trucks.

We just got 300 for next year. We've got 300 vans coming this year, the ProMasters. We've got several hundred other trucks coming for the installers. We've got the new training center. We've got the best tax planners. We've got the best R&D. We understand tax rules. So it was so nice when someone was able to partner with us. It's a win-win because now they're millionaires most of the time. Now they get to focus on what they got into business for. And I feel like overall, it's got to be a win-win. What's in it for me if I'm them? So I always think from that angle, what's in it for me if I get into business with A1? And the purpose of getting into business with

A1 is never to become A1. You got your own culture. We're trying to fill the gaps. So next month, I'm trying to get a couple of these deals cashed, like cash in the bank. The month after that, we're trying to get a couple money in the bank. So I think when the industry hears that we're actually able to pay cash and get money for these guys, I think we're going to get a lot more. And then I say one, and our partnerships continue to grow. It's possibly opportunities in other industries, but the main thing is that we're a great partner.

We help them out at the spots where they need help. I mean, most companies, they find it hard to have manuals and not great meetings and continue to get these things done. So that's where we come in. So Cody asked me a question. The books that I have right now are Jeffrey Gittimer. He wrote a book called The Sales Manifesto, The Little Green Book of Getting Your Way,

Cha-Ching, The Book of Yes. So I'm going to be spending the next couple of months working all of his books. And there's another guy called O.G. Mandino. And he wrote a lot of great books, too. They're little books that I can knock out pretty quick. So The Greatest Salesman in the World Part Two, A Better Way to Live, The Choice, A Surprising New Message of Hopes of His Millions of Readers,

Bringing Up the Best in people the return of the rag picker so those are going to be where i'm spending most of my time right now reading are those books any books on how to charge your customers yes alan roar wrote one i take these books out quite a bit it It's a really good book. How Much Should I Charge? Ellen Rohr. Price Basics for Making Money Doing What You Love. She also wrote Where Did the Money Go? Accounting Basics for Business Owners Who Want to Be Profitable. And The Bare Bones Business Plan. A Simple, Powerful Six-Week Plan for Creating the Business of Your Dreams. All three of these, they're like not expensive. And then the power of positive pricing. I think Ken Goodrich mentioned this book. It's

how much is your pricing costing you? And I've been really trying to grow my TikTok lately. Of course, there's probably a lot of kids that don't know anything, but the power of positive pricing means new computers. It means a better life for your employees. It means you could buy new trucks. You could service people on the weekends. You could work on Christmas if someone needs help.

You could have the management. I look at most businesses and I say, is it really a business if the owner's doing all the work? The book talks a lot about this, but the lady, she's baking pies every day. She gets there early in the morning until late at night. That's not scalable. And so you out in the truck, you've got to understand that Nextar will not allow you into their company at all if you're still in the truck. Julian said that's his number one pet peeve

is that there's no time to implement. I'm sorry, it's so tough. There's some people that'll work 80 hours a week that could actually do both. And it is a lot of work, but it's so much easier to coach and help people when they're in the garage or power washing or plumbing or whatever it might be.

So I'm a big fan of really working with people on not being in the moment of the work. And it's hard to get out of that. What do you look for when looking for a CFO or a controller? I've been struggling for a bit in this area. Well, there's a lot of questions I look for. There's a great book called How to Double Your Business in Six Months or Less. And I'd recommend that they read the book and they tell you what their thoughts are by Bob Pfeiffer. What I'd recommend as well is that you really understand how they run. What kind of software do they use? How do they control your spend on Amazon? If someone needs staplers and more copiers or a copy machine goes out, what do they do? What do they expect to spend from IT? How do they budget? Love to know how for a controller and a CFO, how they build a budget.

Let me see a budget you've prepared in the past. You can scrub out things you can't let me see because of disclosure agreements and whatnot. But ultimately, what you're looking for is someone that can conserve money. A great book by Michael Michalowicz is Profit First. Understanding that a lot of people say they need trucks at the end of the year. Your CPA calls you up and says, hey, dude, buy some trucks. And then you realize you don't have enough cash flow the next year because you spent all the money on trucks. Understand their tax planning abilities. There's a lot there. I found it and I had a good guy on my podcast recently. His name's Ryan.

Fractional CFOs might not be a bad idea either because I've always found that getting someone that's very, very good at what they do, but maybe not full-time is better. I love the two of you operation. I'm a chimney industry. Any way to make this happen? Yeah, you can come down. We've got a pretty nice facility here.

We just bought the building next door. We've got here. We do tour the facility if you want to come for vertical track in October when it actually cools down a little bit. It's one of the main things we do is we tour the facility. I've got guys working. They'll actually get to meet the trainers, see how they're training, the recruiters.

We've got lots of recruiters, lots of full-time trainers. The company is growing and it's only going to get bigger. We've got a traveling trainer team now. And it's so much fun because it's starting to just build on its own organically. It's not as much me or Adam doing the work anymore. There's so many meetings going on and there's so many things getting done. I feel like this company is just, it's ready to bust open. And I feel like it already has, but it's something different now. It's crazy to see it. And it's crazy to see even how the different locations look now and how great it's getting. How do you negotiate lease to own service vans so you can put shelves and wrap them as well? How can you negotiate leases? Enterprise is one of the companies I use, and we lease to own. So it's a four- to five-year lease. We've got some four-year, some five-year, where after the lease, you get to own them for $5. So basically, I own them, but it's a different form of ownership.

And if you look at the lease, I really do own them, but that's what I would negotiate is a lease to own for sure. Tracy Parrish said, we have a handyman business in Nashville, Tennessee, and I've been looking at hourly pay versus pay by the job. Currently we pay hourly and the faster guy complains of not getting their hours. The slow guys always go over. Any thoughts? Depending on the business, for a handyman company, it's really hard to just pay by the job because I prefer always paying by the job and have them help come up with the pricing so that they're always making sure that they understand what

they're doing. Now, the problem with a handyman is, and I love the industry, don't get me wrong, it's just you're a jack of all trades, a master of none. You need to know how to do anything, bookshelves, drywall, you got to do tile, you got to be able to do some electricity, some plumbing, change out these locks, do this, do that. And it's really difficult, I would say. I'd probably do a hybrid to say, here's how much money I need to make on this job. I bid the job like this. The way I price would definitely go into the way I pay. So I would need to understand your pay structure, Tracy, but there's no way I'd be losing money. If I was paying part hourly and then part job, I'd want to make sure that I'm making more money on the job, having them move by less hours. So let's just say changing out five locks, I charge $200 for 40 bucks a piece. So $40 a piece,

I'm paying $20 an hour. I might say, if you finish faster than an hour, I'll give you an extra five bucks. So tough question until I see the way you pay and the way you quote. Lincoln Nation, we have a CSR and tech manual that are not in depth and my dispatcher manual doesn't exist. I am the hat wearer and dispatch is something I need to delegate. It's the one thing that keeps me away from some of the more important tasks. I'm just stuck on where to start. As my mindset changes and how to do things better, the staff band-aids I hired are trying harder to meet my standards, but it's not moving fast enough for me. Every day I wake up and think, where is the time I need at the office? Am I alone?

Well, you've heard of this keep it simple Simon. If I take a 10th grader, bring them into the room and they can't understand what their job is. If you're like, well, you got to go to Zillow, then you got to check them on Facebook. Then you got to listen to the phone call. Then you got to there's something to be said about a very smart person knows how to put things into easy systems where anybody could do it. At McDonald's, you got to hit a five digit code every time you wash your hands because they want to know you wash your hands once every hour. So now they've got a system to track that. So what I would say, if your system is convoluted, as it's difficult, that you've actually failed at creating the right

system. And I think way too often, many, many, many, many, many business owners, they overcomplicate things. They make them difficult. They make them tough. And what happens from those is they're not followed correctly. So I would just go back to the drawing board and say, how do I keep it so simple that if I brought someone new and they'd get it a little bit faster, because dispatching is one of those things where it takes some time to dial in and I understand what you're doing, but I'm telling you, there's eight ways to the top of the mountain. And until you see a significant loss in revenue and profit, I wouldn't think that there's not anyone else could do it. I'd like to see the mindset when people are coming in of how they're doing it. But there's a lot of ways to win with that. Hey, I hope you're enjoying

this conversation. I just want to take a five second break to let you know that the tickets for my next Vertical Track event are now on sale. Just go to verticaltrack.com to learn more and get a guaranteed seat before the prices go up. Now back to our interview. Scott Barker said, where would be the best place to find an aptitude test for pre-employment? I want to be more efficient and cut back on the waste of time people that will never meet expectations. You know, Jonathan Wissman, I use the predictive predict test. I like that one a lot. There were times where I used to use some free tests.

They didn't work as much. I think the biggest thing is getting people outside of the interview, taking them out to eat, spending some time with them, maybe doing a ride along, maybe having the person just hang out for a day and ask questions and see how they do. I think the biggest problem is people are where they're on a stage. Okay. When they come in for the interview, they're prepared, but I i like to get them ask them questions to get them talking there's no right or wrong answer so you know you ask questions like tell me what you did last summer that really stood out uh when's the last time you actually accomplished something and what you're looking for there is hopefully it was in a team environment because hopefully they're working in a team

environment but whatever you can do to get them talking about an experience get them off to where they're being genuine and i have like a beer test what i go have a beer with this person and do i enjoy their company there are times in my company in my life that we've been forced to hire people that i really didn't get along with or like because i thought man there's just not good people out there until i realized finding great people is actually called recruiting, not putting an ad up and having them come to you. Recruiting is way different. Recruiting is going out there and getting them. Recruiting is going and actually looking for people on the weekends. It's actually calling customers up and ask them if they know one of anybody. It's actually a whole

process. It's not simply going, I put an ad out there on Craigslist. I'm on Indeed. I'm on Monster. I just did something on CareerBuilder. I got a LinkedIn ad up. I did some Craigslist up. I don't care all the stuff you're doing. That's all for the unemployment line. You wonder why you're getting bad people when you go to the unemployment line. It's amazing to me. Why not find somebody? Why not get every one of your employees to go online real quick and say how much they love working with you? Why not tell them, listen, if you get somebody through your portal, I'll give you a thousand bucks. I get 1500. Why not continue to think about ways to drive in amazing people that already have

jobs that'll make the switch. People are like, no one wants to work like they used to. Trust me, the people that want to work are still at work. The people that want to work are still at work. You got to get them to make a switch. I think that's a big deal that people don't understand. Mike Strange, I employed him as our ops manager, but I realized it was too soon because we were too small for an ops, and there's not enough to manage, and he is costing a fortune. Yeah, I agree. That's a tough call. And he's got to feel that way, too.

When I come into work, I'm never like, there's no one here that says I don't have enough to do. Your guy's probably feeling like that, and maybe there's a solution he could come to together. Maybe he's willing to adjust his pay in the time being. And if not, to listen, I'm stuck between a hard spot and a rock right now. What would you do if you were me? I need to grow this business and that's going to take an investment of money. I can't do that when you're siphoning the money. And it's a decision that I made, but now I wanted to talk to you and see if we can come up with some type of remedy.

Maybe you work with me for the next six months at a more reasonable rate or some type of consulting fee. If you could live off of it. And then we go back to this as the company grows by four or five more hires or 10 or whatever your number is. But there's got to be somewhere to meet in the middle. Let's see here. Chad said, I'm in window slash door sales, which is a new industry for me.

I was a top finance manager in an auto industry and decided to make a change. So I'm trying to learn as much as I can. Do you recommend any books on mastering sales, the sales side of things? Oh, yeah. I mean, The Ultimate Sales Machine by Chet Holmes, for sure. There's the best salesman in the world. Every book I think I've read is about sales. Influence is probably the number one book in the world for sales by Robert Cialdini.

There's Sell Different by Lee Saltz. Start with why. There's a lot of sales books. It's so hard to pick one book for sales. But I would say, oh boy, I really like the ultimate sales machine. I really like sell different by Lee salts. If I had to just pick two on the shelf real quick.

Uh, let's see here. Brendan, I was wondering if Angie's list is worth it. High rate of calls in my area for garage door repair. According to Angela's list rep, I think Angie's list, according to Angie's List rep. I think Angie's List, you know, it's funny.

I talked to a CMO, chief marketing officer, and he works for a big private equity company. And he told me, he said, home advisor, and this is not for garage stores. This is a different industry. But he said, for HVAC and plumbing, home advisor works amazing in one area and zero in another area angie's list works great in one area but thumbtack works better in another area i've actually made money off a group on a living social in some areas i don't think there's a one-size-fits-all i'm part of the bbb still people say the bbb people tell me valpac doesn't work people say don't wrap your trucks it doesn't work people say tv radio bill't wrap your trucks. It doesn't work. People say TV, radio billboards are a waste of money. I love when somebody who's really small

tries to lecture me. I've made all the mistakes and I can tell you there's an ROI on all these things. It wouldn't exist if there wasn't, if something doesn't work at all. And that's not what you're saying here on the Angie's List stuff. I would say, Brandon, I would try the Angie's List, but I'd make sure I have what's called attribution. It's understanding where you're saying here on the Angie's List stuff. I would say, Brandon, I would try the Angie's List, but I'd make sure I have what's called attribution. It's understanding where you're getting the lead from. And I know Google's always going to get some credit, but something like Angie's List, you can really get attribution really quite easily.

Mike, I'd love to come to the UK. Let's figure out a time to get out there. I've never been to England, Scotland, Ireland, anywhere in that whole island. So love to get out there in the next year. Let me know when you're thinking and I'll come out. I think when it comes to business, I want you guys to just think about some stuff for me for a minute. Driving leads, booking the phone calls, maximizing the phone calls. It's very quite simple. I'll go through the five basic things that I always do. How much money do you want to make this year? And come up with a realistic

number that you could actually budget out to make. So just put something that says budgeted revenue. And I want you to guys write this down for me. So I'm going to put 151 million. And then I'm going to pull up service Titan. And this is just some quick math. And I'm going to pull out a calculator right now as well. So search calc on your computer, it'll pop up. So I've got my calculator up. I want to do a little task with you right now. My average shell today, average close deal. Now remember, average close sales different than every average opportunity. I'll just go average opportunities, 890. So now watch this. I got to take 151 million. So you do your numbers, 151 million divided by 890. So I need 169,662 calls. So basically 170,000 calls. But now this number is going to get bigger.

So now I look at conversion rate. I think a blended conversion rate, maybe 75%. So put 75% if that's your conversion rate between service and sales. So I divide that number by 0.75. And now I've got 226,000 calls. Now I got to look at my booking rate. My booking rate today, it's 81. So now I know exactly how many calls I need. I need 280,000 calls. Now, what I could do is I could increase conversion rate, increase average ticket, or increase my booking rate. Those are the three ways to get this number down. Those are the only three ways to get that number down. But now I just say, what does it cost me to acquire a customer? I'll just choose simple number times $60. So just multiply this times 60. And I've got to spend $16.7 million. $16.756 million. So a little more than 10. So that's about 12% because I wanted $151 million and I got a little about $ 17 million. So not quite where I

want to be. So what I need to do is drive up that average close ticket. But if I were to use the other number of average close ticket, you know what? I should have used that because I brought in my conversion rate. So I would have had to use this instead of the 890, I should have used 1162. I know this is confusing you guys, but basically you want to figure out what do I need to get to for revenue? Divide that by your average ticket, divide that by your conversion rate, divide that by your booking rate, and then times that by what it costs you to acquire a customer. And that's how much you spend in marketing. Now, all I know is if I want to go higher, I just need to dump in more money into the machine. Once I've got these numbers, it's like a little funnel. It's a spigot. I just feel more gasoline than when I want more calls.

It's a pretty cool little concept and it works every time. So when I go into a company, what I do is I'll actually sit down and I'll get all these numbers. And what I do is I realize that they don't have accurate numbers. And how are you going to fix something if you can't get the basic numbers out of a CRM? I mean, if you can't figure out the basic numbers in a CRM, then we need to work on some things like call cap. We'll tell you your call booking rate. A lot of people say I'm around this,

but they don't know what CSR is booking what. So they don't ever know who to work with. There's a lot of ambiguity in the way people get these numbers. So go back to the drawing board, get these numbers, and then build manual standard operative procedures and checklists and live, die, and breathe by that stuff. And what you'll find is the company has the ability to grow. Now, when I found out a KFC is opening up in less than 24 hours, so there's new KFCs opening up, how good does their stuff need to be? How tight? The difference is between them and a

home service company is it's under one roof. So the new store, there's not a whole lot of mistakes that can happen in their 1,200, 1,500 square feet building. We've got square feet everywhere. I've got hundreds of technicians all over the road. We've got different vehicles. i've got hundreds of technicians all over the road we've got different vehicles we've got lots of windshields that can get scratched and damaged we've got brakes that can go off so the vehicles alone are a lot then you've got the background checks and drug tests and then you've got figuring out where the next recruit's going to come from and then you've got where are you going to get the computers for everybody and how do i get marketing working and and what do i do if there's a problem in the economy? And listen, everybody wants to be in business, but no one wants to deal with this

stuff. It's a lot easier to just go somewhere and make six figures, do what you're doing, because no one wants these problems. I got lucky. I started in my early 20s, made all the mistakes. By the time I was 30, I was able to really run with this thing. i'm going on the m40 now so what i would say is i just think business is not as easy as people think and home service happens to be they're very difficult business it's a lot easier for people that have been in it a long time and made all the mistakes but it's not easy anybody that says it is there's a lot of guys i see online some of them i know and they brag about how much money they make that that they got great big Facebook groups. And I'm looking at them going, A1 will do roughly, not where I'd like it to do, probably about 25 million. And then with some partnerships, a little over 30

million this year, bottom line, that's EBITDA. So there's some ad backs in there. And that's before amortization and depreciation. So it's a good number for me. It's a lot of money actually for anybody, I think. I don't think even Warren Buffett says $30 million is a small, $25, $30 million is a small number. So I got in the business to make a profit, to do what I want, when I want, with who I want. And I'm hoping you guys want the same thing.

Let's see here. Mike Strange said, am I Google PPCc how do we know if we spend more money we will get more leads my guy says that's not how it works well it's not necessarily you dump in more money more leads a google pay-per-click there's what's called a quality score so there's when someone clicks on you if i were to to search for Pepsi, and I clicked on the top ad and Coca-Cola paid more, they paid way more for it to be in the number one spot. Coke would probably come up number one no matter what. This is a bad example. But Pepsi could have bid way more.

Now, I landed on Pepsi, and I don't stay on Pepsi at all. I clicked right off. I wanted Coca-Cola. So I jumped off the page. I just clicked right off. It's a click-through rate. So the quality score, all of a sudden that Pepsi campaign goes way down. Now they've got call tracking members. So they know that I got the call. When people find what they want, they stay on the page. Number one. Number two, there's not a bounce rate. Number two, they start scrolling through and they start reading stuff.

And a lot of it has to do with mobile friendly. So quality scores are what matter quite a bit. Now, if I was bidding for pay-per-click and I was looking for a garage door, a garage door part, I've got my pay-per-click set up to not be serial numbers or certain things that I know people because I don't want to sell them a part. I want to sell them a service to install the part. So there's negative keywords too. One of the things I always want to do is always bid on my own keywords because I'll be the number one quality for my own keywords. Of course, I'm A1 Grocer service, so it's way cheaper for me when they search exactly what they're looking for. So Ken Goodrich with Gettle told me one day as he started doing more TV, radio billboards, his Google spend started cutting in half, cutting in half, cutting in half. People actually started searching Gettle versus garage door or versus air conditioning repair in Phoenix or Vegas. So I think that it's important to understand quality score,

the different negative keywords, how to put on your own keywords, understanding what click-through rate is, how to put content that people want. And there's all kinds of other things. There's pay-per-click, but now there's a sponsored ad in your Google My Business area, which is freaking pretty cool too. Let's see here. Dominique Williams said, with a shift in the market at this time and buyers tightening up, what should we do as business owners as we head into what could be a difficult time? Cleaning service here, by the way. Well, a really smart guy once told me to make an Excel sheet if times get bad. Put down every one of your employees, put what you would write them one out of 10, put the return on investment each one of them give you. And what I would do is I'd have

a highlighted area, maybe the top you highlighted black, those are your essentials. Those guys and gals aren't going anywhere. The white areas are maybes. And then maybe the yellow at the bottom are ones that are on the fence, or maybe you go green, yellow, red, whatever you want to do. But I'd really start to understand when if and when shit is the fan, you're prepared. But never live your life or your company in a way, if it turns into a bad economy, it's an opportunity. Trust me, you look around at the millionaires and billionaires in the world. Bad economies are when people get richer. It's when it takes market share. The country makes what's called a GDP. It's just gross domestic product.

And there's negative and positive. When we're negative gross domestic, the GDP is negative. Two quarters in a row, we're in a recession. A recession is not good, but it's not a depression. So people are tending to feel a little bit weirder. It's weird because if you own a home, you've got a lot of equity. So for home service, I'm not as concerned, but there's equity loans now you could do. There's a lot of kinds of really creative financing. As far as for cleaning houses, that's a lifestyle. I don't think you're going to see a complete fall in the people that are getting their homes cleaned personally. I would say that when everybody gets smaller, you got to get leaner. You got to get more efficient.

What happens during a bad time is all of a sudden you start cleaning up the garbage. When the market's good, everything's good. You're buying lunch every day. People are getting bonuses. You're smiling. You're taking a bowling. You're loving them. Hey, a race here, a race here.

Then all of a sudden you got to learn how to tighten up. Read this book. I just talked about it earlier. I saw it on my shelf. This is a good book that I would read going into a hard time. It's Double Your Profits, like I said earlier, six months or less. And I think it's a game changer for you if you really are headed into a time that you feel is not going to be great. Personally, I'm not too concerned.

There's a lot of speculation, a lot of negative press out there. But if I believed everything I read, I'd be in a weird, there's no way to be where I'm at today. One of the things I'd really try to figure out too is how to make yourself understand who needs to be hired next. I think that too often we look for people right as we need them. Build out a six-month org chart if I were you. Six months to look at what you're going to need to look like and really have goals of what this company needs to grow to in the next six months and live, die, and breathe by those goals. And this will tell you where you need to be spending your time, where you need to be coaching, what you should be doing. Let me see how we're doing

this month. We literally, this is not good for me, but we just tied last year this time. Actually, we're tied with revenue for the whole month of last June on the 21st. And the day's not over yet, so we'll probably be beating. I would have loved it by the 15th to be beating. That means I'm growing 100%. It's the 21st, so I'm not 100% growth this month. Are you monitoring those numbers? Are you looking at those numbers? What are you doing to make sure that you're aggressive on those numbers? So the numbers are going to lead you to live, die, and breathe by. There's a lot of software we're investing in.

Try to become more efficient in marketing. I'm always learning about marketing. Marketing and sales, marketing and sales, marketing and sales. What is marketing? Marketing is how I'm finding these partnerships. Marketing is how I find my customers. Marketing is my recruiting. Marketing is basically the lifeline of everything.

It's a lifeblood. And sales are just, how do I sell someone over the phone? How do I sell a conversion rate? How do I increase the average ticket? So sales and marketing should be the life of what you do. And if you continue to sell out there, you're selling trainers, you're selling recruiters, you're selling people on you and the business. So remember those things, guys.

Love the questions. Think long and hard about the next month's questions. If I could do these every day, I would. I actually really, really enjoy them. Mike just asked one more question here. What are the best KPIs as a business owner to keep on top of every month? So every business is a little bit different, but you definitely need to know your booking rate, conversion rate, how much it costs you to acquire a customer. Because I'm in 29 markets, I can look at P&Ls, their income statements, and I can start to look at how much

gross profit is a really good one. When I'm developing wages, gross profit seems to be, because gross profit doesn't lie about a lot of things that other numbers do, but you've got the ones within the CRM and then you got the ones within the financial statements. I'm more of a CRM guy myself. I'd say the CFO and the controller, they're way more on the financial side. But I know that everything that happens within the CRM is going over to there. It's not like what happens in the financials all of a sudden hit the CRM. It's the customers depend on what happens with the financial statements. So I'm going to the earlier, what caused that financial statement? What's my cost of goods in that market versus other markets? So I can look at how is this happening and what

kind of, you find these gems when you study numbers, you actually say, what is the most important thing? And as you continue to find these gems, it gets easier and easier and easier because I've got data points that no one else has. I'd love it if you guys looked up what regression testing is. I've talked about it quite a bit on the podcast, but you're able to test different things on, for example, a homeowner, how much they've got paid off on the house. Is it their credit score? Is it how big is their square feet? Is it the male or female? Is it the age? Is it the age of the customer or the home? There's all these things. And when you got to pull as big as ours, you can do a lot of cool stuff. So anyways, I appreciate you guys. A lot of people are on here

i'm getting questions here from youtube linkedin twitter facebook so thank you guys for coming today and uh hanging out and i hope you have a fantastic week fantastic month make it a great summer i'll catch up with you guys later see See you guys. Hey, I hope you enjoyed today's podcast. Before you go, I wanted to invite you to my next Vertical Track event. We've opened it up to all home service companies, just like our last event. And people across all industries have been messaging me all the time saying this last event brought them as much as a 10 times return on their investment. You need to go there, check it out, and sign up today.

Now, the great news is, is that we're doing it again in October and we want it to be the best event of the year in the home service space. If you're ready to build systems to scale and get out of the truck once and for all, get your tickets right now at verticaltrack.com. We're about to go through some tough times in the economy

and I want to give you some tools and some tips to get through it and start making more money than you ever realized. So go to verticaltrack.com and get your tickets now.