The Home Service Expert Podcast - Q&A With Tommy - Growing Your Biz Without Working Like a Madman

Episode Date: May 14, 2021

Tommy Mello is the author of Home Service Millionaire and the founder of A1 Garage Doors, a $40 million-plus home service business with over 200 employees in 9 states. Through HomeServiceMillionaire.com and the Home Service Expert podcast, Tommy shares his learnings and insights to help fellow entrepreneurs scale their businesses. In this episode, we answered some of our listeners’ most pressing questions.

you don't get burned out when you love what you do and your job should be to fill out people. Your job should be able to get as many people as possible doing the things that you absolutely hate. I don't sit there and do the accounting because quite honestly, going through the bills and figuring out how much we owe the electricity bill is not my idea of a good time. When you're stepping in and the beginning of a business, you'll learn to do the things that you have to do. But if I were you, I'd work on an org chart and I'd put in the pieces that a business, you'll learn to do the things that you have to do. But if I were you, I'd work on an org chart and I'd put in the pieces that you know you need. First thing I got burnt out at is at a movie theater when I have to answer a damn phone call. I used to love the

phone ring. I'd be like, money, hell yeah. So I'd grab the phone and be like, dude, yes. And then finally I was like in the middle of dinner, in the middle of a movie, in the middle of a date, whatever it was, it started to really bother me. So I hired my first CSR. Then I got my first bookkeeper and slowly but surely I got to do what I love. I love training. I love doing things like motivation. I love the passion. I love exciting meetings. I love the big picture. I love white boarding. So learn to do what you love, turn your job into what you always wanted it to be, and that's something you love. Welcome to the Home Service Expert,

where each week, Tommy chats with world-class entrepreneurs and experts in various fields, like marketing, sales, hiring, and leadership, to find out what's really behind their success in business. Now, your host, the home Service Millionaire, Tommy Mello. All right, so we're trying something new today. I guess I'm just going to answer some questions. So the questions are from people who bought the Home Service Millionaire book, they bought the Home Service Millionaire course, or they joined the free Facebook group. So

if you search Home Service Expert Group, I will be answering a ton of questions. So let's go through and answer some stuff here. All right. This is from John Hartle. I know you work with L. Levy in creating manuals for the positions in your company. When you first started with your very first manual, how did you set aside the time were you still in the business on day-to-day running the business ps when is anyone coming to pittsburgh i got some good buddies in pittsburgh so i'm going to be out there i'm guessing here the next year and uh what happened with the manuals with al levy is we actually me adam and brian daport, we lock ourselves in a conference room for weeks at a time. And I'm not involved in operations as much as most people

might think. I'm literally working on the business the whole time. So it wasn't very difficult for me. They did the heavy lifting. I had a hard time sitting still. Adam and Brian did a much better job than me. The manuals are key, but then sticking to the manual, and it took years to figure out how to stick to the manual and do a really good job of it. Let's see. Looking for words of wisdom, loud and clear. All right, we got it. So Ryan said, I'm in the process of writing processes, and I'm looking for a system for organizing it and sharing it. I'm hesitant to just print it and let the crew have the book because I don't want it shared in public.

Is there a method to share the process online that will not allow downloading or printing? I could use direction or some ideas on where to house the process manual. I know that there's just read-only. There's several ways to get read-only, whether that's set up in a Google Drive. You can share them with a read-only. You can set that up in Microsoft 360, where they're not allowed.

They can print it out. But I'll tell you this. The best words of wisdom I could tell you is do not live in fear. Do not live in fear that somebody's going to steal your manuals and all of a sudden they're gonna have the keys to the kingdom and all your hard work has gone to shame.

If they start making it big time and you think there's a counter lawsuit, then great. But the manuals are just the process. It's getting the people excited to learn the process. That's the hard part. It's getting them to build a pay structure that they're literally rewarded to follow the process. So I think too many times we live in fear. I mean, I don't check my own emails. I don't do a whole

lot of administrative work at all. In fact, I figured out my hourly rate of what I make per hour. And if I paid somebody $50 an hour and it took them 10 hours to do what I could do in an hour, $500 is still a bargain because get my hour back. And I like to be the passion of the company. I like to be the mascot, the role model, the guy handing out the trophies, the guy smiling, the guy giving advice, the father figure in the group. I think that that's important to be as an owner. Let's go to Joy Harris. I'm looking for a process system that will help with inventory trucks and job costing to be accurate efficient and lean i consider service saying but it doesn't seem great for actual accounts i consider 360 scanning software it

doesn't integrate with service site the inventory is one of those crazy things this is what i tell people about inventory is uh 10 000 before christ 10 000 bc they still did inventory yes there's a great system of setting pop labels or qr codes i don't like to over complicate it al levy and alan roar always recommended don't count the the slices of bread just count the loaves overall what I came up with is to spot check. It's a great theory. You just go in. Instead of your people all doing inventory for a half an hour once a week, what I do,

and this is the process I've been working on, but have them do their own inventory. Come in and make sure the trucks are set up perfect in all the right spots. Everything's got a system. It's got a sticker. It should have the total amounts it should have have them bring you the inventory sheet and then all you do is say i'm going to pick this one take a highlighter out randomly pick five and say here's what we're going to do if you're dead on i'm going to give you a gift card if you're wrong i'm going to write you up we're going to count these five random ones and guess what after the first couple of write-ups,

it'll be right every single time. Do not take the time to stand out there for three hours and sort out their trucks. I've never understood that. It's not our job. Just bring your truck perfectly organized to me, clean, washed, smell good. And I'm going to go up a checklist, boom, boom, boom, boom, boom, boom, boom. Okay. I'm going to take five things. I'm going to pick this one, this one, this one, this one randomly. so let's go count your struts let's go count your 373 lms whatever it might be check their inventory and it should be a reward system if they get it right let's talk about mindset and delegation got lots of questions here and then i'm going to break it down to some stuff that uh is on my mind as well

mindset delegation this is by steve nunn i'm a small one-man business show running a high-end frameless shower and interior glass company i started in 2011. i'm also a fireman by day this year by myself and without paid advertising i will probably do around $200,000. Does it make sense to go ahead first into this business before at least retiring with my 20-year pension for about four more years? Can't figure out how to make this thing take off without me always being there. I'm not going to give you career advice. I'll tell you this. The chances of your business succeeding are definitely against all of us. I think they say nine out of 10 businesses will fail for within the first five years and nine out of those 10 will fail within the next five years.

So 10 years, you got 1% and I'm not trying to scare you, but I'm just trying to say, if I knew a lot more about you and I'd ask a lot of things, I'd ask, what's your family life like? How old are your kids? How much time do you have to do this? But me personally, I would quit my fireman job. I don't know how much the pension is. If it's over 50 grand a year, pension every year that I'm not working, I might think about that. But if you're making 200 grand, I wouldn't think about revenue. I care more about net. If you're netting 200 grand, I think the potential to grow a business, get a couple of guys with you,

you're not hard to get to a million. That's 300 grand, 300 grand a year after five years. Let's say you live off a hundred grand. That's still a million dollars invested correctly. You could do a lot of things. You could be buying real estate. I know a guy, and I just talked about this earlier, he bought a house every year. And then on year 11, he sold the house from year one. It was paid off. And he made a small fortune. So if you could do something like that, but we're here to talk about small business, and I think you could make a small fortune in the home service industry. But it comes with a lot of sacrifices. It's not easy. It's hard to walk away from a pension.

You're right. It's very, very hard to walk away from a pension. But there's a lot of sacrifices. It's not easy. It's hard to walk away from a pension. You're right. It's very, very hard to walk away from a pension. But there's a lot of tough decisions that need to be made. What I would do is really start looking at it. You got to understand right now, home services and the best time it'll ever be. I mean, right now, I've been in this industry for over 15 years, never seen anything like this. So just because you made 200 grand does not mean this is going to last forever. You got to learn a lot. I recommend reading a lot of books, you know, and I could go through some of those books here. You know, this is a good book. I was just on a podcast earlier. It's called the Clippership Strategy. This is a guide on how

to apply it. But in the 1860s, they had clippers ships that would go from New York all the way around to California. And what they would do is it was 1860 when there was a gold rush and they learned that you could buy something for literally 10 cents and sell it for almost a dollar in another pocket of town. So it shows you where to find where they're striking gold because there's literally cities that the government's pouring money into. And if you could start getting those government contracts, it's a really good book. Let's keep going through here. John Biedeger, I know success is found in playing the long game, staying in there and progressing day after day. How do you prevent burnout? What are some signs

you need to step back and turn it on what's your mindset i asked because i burnt myself out in my last business as a trainer and i don't want to start over again i'm currently a pressure washer and love what i do i want to establish a healthy company i'm a startup motor frankly just on a job right now what i would say with that one is hire your weaknesses i'll never get burned out working on marketing and coaching guys on sales. And look at this text message I just got. I just want to share this text message. Tommy, I'm so glad I worked for this company.

I just finished up with Max Life Overhaul and Max Life Rollers with a jack shaft opener. And just talking with this customer, he said he was completely sold by us as a company before I even arrived to perform the work. No other companies put in the effort to make everyone successful except day one. I said, I really can't hear enough of this. Thanks. He said, of course, man, you don't get burned out when you love what you do. And your job should be to fill out people. Your job should be able to get as many people as possible doing the things that you absolutely hate. I don't sit there and do the

accounting because quite honestly, going through the bills and figuring out how much we owe the electricity bill is not my idea of a good time. When you're stepping in and the beginning of a business, you'll learn to do the things that you have to do. But if I were you, I'd work on an org chart and I'd put in the pieces that you know you need. First thing I got burnt out at is at a movie theater when I have to answer a damn phone call. I used to love the phone ring. I'd be like, money, hell yes. I'd grab the phone and be like, dude, yes.

And then finally I was like in the middle of dinner, in the middle of a movie, in the middle of a date. Whatever it was, it started to really bother me. So I hired my first CSR. Then I got my first bookkeeper. And slowly but surely I got to do what I love my first CSR. Then I got my first bookkeeper. And slowly but surely, I got to do what I love. I love training. I love doing things like motivation. I love the passion. I love exciting meetings. I love the big picture. I love whiteboarding. So learn to do what you love. Turn

your job into what you always wanted it to be. And that's something you love. I'm going to read the questions here in a minute. This is from Ted Bednarski. Ted B. I started with myself in a truck, grew it to a couple of trucks and now manage the office and the things. How can I grow to a decent sized company by self-funding and not taking 10 years to grow? Right now I'm in the project manager role, estimator, HR, sales rep, CSR. If I hire people for all those roles so I can just concentrate on the business, financially, I would not be able to. Well, we go back to a lot of things on that question is, are you charging the right price? I have all those things, and we're not the cheapest,

but I'll tell you one thing. There's nobody that can compare to the quality of the tools, of the vehicles, of the training, of the trademarked parts that I use. No one. I've got the highest booking rate in the industry by far, I guarantee you. Highest average ticket, highest conversion rate, lowest cost per acquisition. I could also pay more than most of my competitors, but I've done so well on SEO and the Google My Business page and LSA ads and getting a converting valve pack. Then when I can beat everybody on conversion, I can beat them on average ticket. I can beat them on ad conversion.

All these metrics. It's because of our team. Trust me, me alone can never get those conversion rates and average tickets that high and train the guys as well. So if you find a specialist to do each thing, your margin goes up, your profit goes up, you're taking care of customers more, your reviews go up. And when all that's combined, it's like you're a machine. So I would say start with a couple of these things and make sure you're working on your key performance indicators and increasing them. Because if you increase them, so when you hire somebody, say, what is this going to do? Is this an admin role that's going to add into a negative?

Or is this going to be giving me more money? So what would I do? First thing I do is hire a CSR that's going to be able to book calls that maybe I wasn't available to book. I was on the ladder. Boom, that's a revenue add. Next thing I do, you're lot about a lot of admin jobs here so marketing what could i have with marketing if i can get my phone to ring and bring my acquisition cost from 70 a call to 30 that's an extra 40 an opportunity so that's a revenue

making machine it's an administrative role but it's still making me a lot of money so think about the first things you could add that'll add to the bottom line and free up your time. That's the best advice I could give you on that because you're going to be wearing a lot of the hats in the beginning, but that's truly not a business. That's a job. Richard Anderson, I'm doing a business in the Bay Area and it's expensive because of so many factors. Do you pay for performance or hourly? What benefits do you have standard and if any vacation time? Performance pay. I was sitting down at a desk just like this two offices ago. This is a good fun story for me. And Adam, my general manager and COO walks in and he says, hey, Tommy, it's time for our yearly reviews. And I said, all righty, let's take a seat. I grabbed a bottle of water and I said, send them on in. Let's go. So the first one sat down and it

was a CSR. And they said, he said, thank you so much for being here. Here's an extra dollar. You deserve it. And you've done well, blah, blah, blah, blah, blah. Then 75 cents, 50 cents, $1.25. And I'm going through this and I'm like, this kind of sucks because they've been here, they get tenure. And I said, well, yeah, that's how it works. And I said, well, no, no, no, no. I remember at that very moment,

I had one of my techs call me and he said, dude, I love this company. I just made a few hundred bucks today. And he's more on a performance pay. And I said, from now on, Adam, I'm not going to do this 10-year crap. I'm going to do it on meritocracy. Pays people's pay on merit that they deliver. And I'll tell you what, we made a lot of mistakes when we did performance pay. But now we've got it dialed in and we've changed things. And it's tough to change with performance pay. But when my team wins, I win. Guess what?

If we don't make money as a company, I don't get to pay my bills. I'm on performance pay. I like to have skin in the game. And I like it when everybody else has skin in the game. So what you'll find is the good people can make pretty good money. I got CSRs that make $25 an hour. The bad people make $12. hour. The bad people make 12. That's the minimum wage they quit. What you'll find is I got a gal that can book 50 calls a day.

So if you got five performers, ready for this? Five people booking 10 calls a day, and they're making $15 an hour, that's $75 an hour. This one girl does the same thing for 25, almost a third of the price. And do you think it's hard for me to find CSRs when I can say that I got people here making $25, $30 an hour answering phones, but that phone rings and I mean, it's like, boom, and they're great. And their booking rates fast and they make the customer happy. And there's empathy. They're very, very good. People that would choose hourly over performance suck. They say, I need to have a stable paycheck and I'm not worth anything. My performance is horrible, so don't pay me performance.

Now, unless you're very, very bad at creating a way to motivate them. So that's not necessarily fair. If your performance pay is not really motivating the right factor. So let's go over how to do performance pay. Simply write down everything on a whiteboard that you need. I need a booking rate over 90%. I want to really make that a big goal. I need them to show a lot of empathy on the phone because Google now has voice analytics that can recognize tonality of your voice. It's going to matter a lot. I guarantee you it already does. I need them to not make mistakes. You know, a drive instead of Avenue on a street name without them repeating it, we'll send a guy an hour in the wrong direction. So we call those internal errors.

I need them to show up on Mondays. Everybody tries to be absent on Monday because it's a busy day, but not our performance pay. So figure out everything you want and then put a value on that. So we get $5 if you're over 90% per call. So you're getting excited. If you take three calls, you know, and you're over 90%, you just made $15 that hour. You get another dollar if you're on time on Mondays and your attendance is right. You get another dollar added to that call. You can make about nine bucks a call. If you book three calls an hour, guess what that equals? 27 bucks. It's not a bad deal. And then we've got hours that aren't quite as busy that we offset those. And I don't want to go into the whole details of it now because I don't want to, and I'm afraid to give it out. I'll give you guys the whole program. I just don't want to confuse anybody.

What kind of benefits do we give? We give PTO. Several weeks of PTO. We give insurance. I'm going to be starting a 401k. We give a brand new truck. We train you to learn the business. Think about that. We train you to learn a profession and we pay you for it. Mitch Shipman, how do you point rating system for your techs? It's funny you should mention that.

We give points out of 1,000 and we look at sales as 400 points. Callback ratio is 150 points. Tech error rate when they make an error is 150 points. The star rating, when they're on Google and and yelp that's worth 200 points and we use a system and service titan that runs off the

the platform of yext you can do that with any system is look at that technician's average rating and they got to get good reviews to get these points. And then we do yard science for 100 points. It equals 1,000 points. The science behind it is you divide into it and 600 points could still be the top grade. And I don't want to confuse people. If you saw all the math behind it, it's fairly straightforward for the techs because they understand what these numbers are

because they've been bred into this. But I really care about giving them a system that they're not just rewarded on just sales. I want them to be empathetic to the dispatchers, take calls at night. I want them to be good at selling financing, be accurate on inventory, make sure their driving's good, make sure their reviews are good out there. There's so many other things, self-generated leads. Are they recruiting people for us? What are other activities or the day in the life of a full-time recruiter? Setting up right now this weekend, we've got a really big show we're setting up. We're going to have a lot of people. We were on the news like seven times that we're hiring.

The recruiter is always looking. One of the things you could do is go on Glassdoor or Indeed and tell your employees. I'd have the recruiter sending out to every happy employee. I'd have them send out a link to that and say, please let us know how we're doing at A1 Garage Door Service. I'd have them text message each person and make sure they follow up till the person leaves a review. That's one thing is have good bait if you're going to go fishing and good bait on Indeed and Glassdoor matter. Another thing I would do is make sure I'm everywhere. Make sure I'm on Indeed. I'm on Glassdoor. I'm on ZipRecruiter. I'm on Craigslist. And another thing they could do is work on an affiliate program. There's a thing called Erin, E-R-I-N, that helps you do affiliate recruiting. Next thing I do is I'd find influencers.

An influencer is somebody that's really big on like TikTok or Instagram or whatever. And then find out the groups where your avatar lives. Maybe they're 22 year old males. Find somebody that's going to influence those people and then pay them $500 a head. I'll tell you a good employee will do a million dollars for me, CSR, dispatcher, or technician. Listen to those numbers. The reason why I could pay for brand new computers and a nice service Titan and beautiful trucks and pay more than my competitors for leads if I have to is because of my employees and they're trained appropriately and they're paid appropriately for what they do. They got skin the game i still do not understand how to run a facebook employment campaign i have haven't read a book in a while would i simply find the details there you know

i'll probably come back on here and talk a lot about facebook i'll get a buddy of mine bill on here we can talk a lot because we've done a lot of experimenting facebook's great but i'll tell you the real secret on facebook is do cool things for your employees like we bought a cruising usa and then videotape all the people taking turns cruising you say and say hey do me a favor go live and put your tracking code on there so somebody else wants to play cruising usa at work and get paid for it you'll make money just when you bring that employee on. I mean, that's not all we do here. I know we do a lot of it.

We do a lot of games, a lot of fun. The culture is really cool here. But ultimately, I would say make it a great place to work. Go live. Have every one of your employees share it. Make funny things that go viral. And guess what? People will flock to you.

But you got to ask yourself when you walk in, would I work for me? Am I a prick? Do I expect things that people to do that I won't do? You better believe I'll clean the toilets. I will clean every toilet in this company. I don't care. There's nothing that's too big or too small for me. If I walk in the parking lot, I'm out there picking up trash. I mean, that stuff kills me when owners expect their employees to do stuff that they won't do. Don't ever be a leader like that. Remember, leaders eat last. I was the last one to get a new vehicle. Got $13,000 off of that bad boy too. How do you decide how many CSRs to have? Let's talk about that real quick. I would have an overflow call center. I'd only have enough CSRs. They better be able to book a few calls an hour

or more, or I'd have an overflow call center. There's plenty of call centers that do overflow, but I would say never do your entire company with overflow. The CSRs at these other companies are just not as good as you are. But you know what they are good at? They're good at taking orders. For example, service side, we don't get paper invoices. So we send all the overflow. And when someone wants a paper invoice

to the overflow call center, or you can just build an IVR. An IVR is press one, press two, press three. What I'd recommend with an IVR is keep it real simple. Press one or press two. Press one if you're looking to book a phone call press two for anything else then you could have another ivr that they might go press one for a paper invoice press two for a warranty issue press three but what we've noticed over the last couple years is spam is continuing

to increase increase increase ivrs work well and then there's a thing that we use called Schedule Engine where they can literally log in, go on our website, go on our advertising, scan a QR code, book the call onto our capacity board. So we don't even need a CSR. So my goal is to get the 40% bookings online without a CSR. Can you imagine cutting your staffing ratio by 40% in your call center and then using an IVR to only have sophisticated, important calls and then have a secondary call center book everything else? Do you think you'd make more money? I promise you would. When I was first introduced to the podcast in September, I had 33 Google reviews. We now have 93. My question is, does the number of Google reviews matter? What matters is, I don't like to have a five star.

I'd rather have a 4.9. There's been studies done that 4.8 and 4.9 are better. I'm not asking people to leave me a pat review, but it matters to your competition. And think about this. What it's called is user-generated content. You didn't write that content. That content ranks better on Google because of the third party, especially once they verify that it's a real user. What are the good businesses? What is a good reason to go to 300? I'm going to go to 25,000. I don't have a limit. When you build a system, it'll automatically get good reviews. I don't have to do anything. What I

tell people is you got to build a snowball. How do you build a snowball in your market when you're brand new? You ask friends and family, like an MLM program. So if I got, like, if I was selling Mary Kay and I got my sister to sell Mary Kay, it's a really old MLM. Like the first thing you do is friends and family, right? And I would say, Hey, talk to your husband, talk to your kids, talk to your neighbors. When you start home service business, use the friends and family and say, listen listen if i do really good on your garage door your paint job or fix your pool let me know how i did online on next door on google on facebook on yelp on wherever so that's building the snowball then you put it down the hill and what happens when you put a

snowball down the hill it starts to build build build. It doesn't stop if the hill keeps going. So I don't necessarily understand the question of stopping. Build a process that works for you when you're not, right? Is Google likely to give me better treatment or SEO because of it? How much is enough? You know, Ray Kroc wrote a book. The story goes like this. When your enemies are drowning, stick a hose in their mouth.

There's nobody intentionally I'm trying to take out of business, although I wouldn't mind it if they all came and worked for me. Website ranking is super important. When somebody wants to find out something more about, read the book, they ask you, answer my market shared, and you'll learn a lot. Reviews matter on your GMB. Yes. Your goal is to get as many things better than your competition as you can. The SEO, I'm literally bringing out a full-time content manager,

three full-time writers, and two videographers. We're going to be posting more content than anybody's ever even imagined. Can you imagine? I'm going to be on TikTok, 20 posts a day. I'm going to be showing the doors getting made in speed and then getting them installed. And it's going to be fun and interesting. It's going to be funny. I'm going to a costume store. We're going to rent all these funny costumes and make interesting videos that deliver value. And they're funny and they're interesting. And then it's education. I'm going to go on Instagram. I'm going to go on Houzz. I'm going to go on Pinterest. I'm going to go on Houzz. I'm going to go on Pinterest. I'm going to go on YouTube, and we're going to make so much great content. I'm going to put Liftmaster versus Jeannie and Clope versus Amar and what to do if your house place is west and how to keep nasty bugs out or how to winterize your garage door. We're going to write 20 articles

a week internally through a Zoom meeting, and then we're going to transpose all those words and make 20 videos out of that Zoom meeting, make a huge 15-word article. Content is king. Okay, there's a great book here that I want you guys to read if you have it. Read the book by Margaret Sheridan. They Ask, You Answer. Then read this book, The Visual Cell.

I can't tell you guys enough. It's going to change you guys' lives. But content is king. Don't ever stop creating content. And the backlinks, I'll just give you guys' lives. But content is king. Don't ever stop creating content. And the backlinks, I'll just give you guys a few ways to make a bunch of backlinks. Number one, find every person you know that you advertise with, find every supply house, find your bank, find your CPA, find your accountant, find your, every single thing you know, go through your business and go through your Rolodex and say, I want to give you a referral.

So I just wanted to tell you guys a great way to get links is go out there and give a lot of people a testimonial. Another thing is have a contest of a college. You get EDU backlinks, have a scholarship and have them make 100 videos for all the companies you want to get links from. And they'll do it for $1,000, $1,000 scholarship. And you'll get the EDU backlinks, which are even better. Steve Nunn, I started the business with my name and the company name. It sounds kind of dorky now

and not very professional. Yes, change your brand. Absolutely. If I wasn't $25 million, I would have changed from A1 because I found out that A1 is a pretty common name. There's And he shows you cool things. Once I started thinking about it, building a brand, it's very, very good. Let's see, I install fences. So it's usually one big thing. How would you nurture your client? How would nurturing a client help me? You know, no one decides, wakes up tomorrow and says, I'm buying a fence. I'm buying a new gate. What you'd want to do is educate people. For me, I'd probably talk about safety of what a good gate has.

I talk about privacy. I build up an email sequence that just nurtures and educates and puts other cool things in there, like not only the gate, but maybe and fences. I'd probably talk about pools, what people are doing for privacy. I'd probably talk about fun events at my house. Something that somebody wants to read that's useful. For example, for garage doors,

I'm going to be interviewing very, very, really good designers, interior designers and exterior designers, and talk about the styles that are coming out and what the front of the house and the landscape should look like. And then I'm going to throw in garages. And so then you can talk about man caves and that has to do with the garage. Think about cool things that people want to learn about. And

that's going to be your blog and interview people, you know, just like any of the podcasts. All right. I got a question from Denise Bogan. I'm still the one driving the supplies around vacuums and ladders for our heavy cleans and post-renovation cleanings. Do you recommend hiring somebody with their own vehicle and make them a field supervisor? This is in the New York City market. What is a fair wage for this role? That's a good question, Denise. I don't know. I guess what I'd ask myself is how much would it cost to get somebody if it's $20 an hour? I'd probably want them to go through and do, what else can you do? Are you building rapport with the customers? Are you asking for

reviews? If I'm going to use my time, I better make it very valuable. So am I checking everything? Am I going through making sure the quality is done? Maybe I have them do a checklist. What I would say is hiring someone else going to make me more scalable. Am I able to delegate? I've got Al Levy's steps of delegation right here. I've kind of made them my own a little bit. I've changed them up. But here's what needs to get done. Number one, the biggest thing I see is delegation.

Here's what needs to get done. Number two, here's why it needs to get done. Number three, here's what you have available to get it done. Number four, the priority assigned to it. Number five, here's what it needs to get done by a deadline. Number six is there's a scheduled meeting to check the progress. Number seven is what is the carrot and the stick? What are the consequences if you don't get it done?

And what kind of treat do I get if I do do it? And then number eight, did the task get done? And what opportunity do we have for feedback? Very important things. So that's kind of a blanket answer is for me to give you the exact thing. I'd say, look at your circumstances and say, well, this will allow us to grow faster. Do you think you can apply your methods to other businesses such as dental offices? I think performance pay works for dental offices. I think technology, I think top of mind awareness

is called a Toma. I think dentist's office are a little more advanced and using a lot of the systems that I talk about. Yeah. I think everything I discuss for the most part works for even any business. There's certain things that apply your booking rate, how you answer the phone matters. When I'm choosing, I want to be somewhere that what's going to stand out? Where's my family going to love? The dentist is a weird place to go. And you really want to like your dentist. Your dentist should like you.

And that should be a conversation. Same thing I talk about in sales. It's a relationship. You're building rapport. I don't want somebody working on my mouth. I hate. It's a weird feeling. So yes, I do think a lot of the stuff I talk about.

What would you be looking for in a business when you buy them? First thing is very easily, what's their EBITDA? What's their profit? I need to know their profit. That's the facts. I want to know how much money they make. And then I'm going to ask their ad backs. What's an ad back? An ad back is my niece. I'm paying for her college. She comes in the office twice a week. Okay. I know I can add that back because I'm not going to be paying your niece to go to college. A lot of business owners do a lot of things in their lives that you can add back. I've got a yacht that I take the company out on once every few years. Okay. I'm going to add that back. It's not a normal thing that we need to do. I've got my Rolls Royce that I drive. Okay. You're not going to keep that. Okay. I could add that back. So, you know, we're going to figure out a multiple of

EBITDA. What I look for, the main thing, what I look for when I buy a garage or a company is going to be how many calls do they get from just being around? That's called goodwill. I mean, if they're not doing a whole lot of advertising, they're getting 30 calls a day. I'm going to look at that and I'm going to go, okay, my average ticket is this. My conversion rate is this. My booking rate's this. Holy crap. I could do a lot with this company. If they're getting their phone to ring all day, every day, that's one of the biggest things I look for. And then I look for, are they on any technology? If I got to go in there and every guy is 78 years old and they're like, they hate change. And they're like, no, please God, don't bring in a CRM. Don't make us accountable. Let us drive these old vehicles.

We love these old vehicles. Don't give us paid time off. And then another thing I'm going to ask them to do is tell me, tell me, Mr. Owner, what are some of the things you think we should do that you didn't have the heart to do? Well, my uncle's been working in the warehouse for 30 years and he's probably not the MVP anymore. And I'd like to, when you sell it to me, I'm going to give him some money. He's been with me a long time, but he'll probably be out of the picture. Great. Who else?

Well, I have this CSR, and she's an only single mother, and she's on it here half the time. She's late all the time. Okay, we're going to try to get her to come in on time, and if she can't, she can't have built her own destiny. Thanks for telling me that. Who else? Well, we got this other guy. you know, he's got facial tattoos and a lot

of customers are worried when he shows up. Okay. Not sure if we're going to be able to work around that one. Let's have a conversation about that, but let's go through each and everything. Let's just be having an honest conversation. I think that that's important. So those are some of the things I'm going to look for. Adam Silverman asked, Greenfield marketing, starting a territory or new product line from scratch or acquiring a company. What tools do you suggest for comparing acquisition of two companies versus going Greenfield? What are good rules of thumb to consider around the topic? So Greenfield is organic growth. I love this question. If you figure out a way to

grow Greenfield to be profitable, fast and grow a big business, that's awesome. Do that. Only thing I can tell you is investment banks do not love Greenfield because there's no certainty. They say you've never been into the city unless you've got a really, really, really expansive track record. They're going to say to grow organic does not give us certainty. Whereas when you pay three or five times EBITDA for a business, guess what? They know in three to five years, you're probably going to get paid back. And hopefully, if you're a platform company, you're going to get better results. You're going to increase booking rate and average tickets and get the marketing costs down. So it's a pretty sure bet for them. There's no guarantees. And they're going to probably loan you about three times. And then as you build those companies and

prove it, they'll give you four and then eventually five. They'll loan you that amount knowing you're going to get paid back and they'll give you a multiple on your EBITDA. So if I bring in 7 million net EBITDA, earnings before interest, tax, depreciation, and amortization is what EBITDA stands for. They're going to, if I made 7 million last year in profit, they're going to give me $21 million line pretty easily. Then they're going to give me three times to buy businesses. So let's just say I go out and I find three $300,000 businesses a year, 300K. They'll give me 900K. But the business that they want, they want more than 900.

They want 1.2 million. I'll take that $21 million line and use that to offset it. So now I'm taking the 900 grand they gave me. I'm borrowing 300,000 from the $21 million line to make that deal whole. But then in six to nine months, they're going to look at that $300,000 and add that back into that $21 million line and make it larger. It's a beautiful thing. I can tell you, I'd look at HubSpot and I'd be literally knocking on every single door. I'd have an outbound call center calling every company. I'd be hitting them up with gifts, like nice things that are specific to that company to say, look, I looked you up online. I'd have a VA doing this the whole

time saying, I'm genuinely interested. I want to partner up. I love your business. I looked at your Google. I looked at your next door. I looked at your Yelp. Show that you gave 10 hours to build them a report and you care about them. That's the first place I'd start. I'd use always emails. I'd send them a gift, send them a Rubik's cube and say, I'm still puzzled why we haven't been working together yet. I'd be pretty tricky about what I'd say. And I'd say, you know, I'd send them a tape measure and say, are you measuring the results that you could be getting without using, without our partnership? All these little things make a huge difference over time. So those are some of the things I do. Software, I would use MailChimp. I would use SurveyMonkey to kind of

pull in my list. I would definitely have a CRM like HubSpot. Greenfield, I'll tell you the Greenfield strategy. It's pretty easy. You got to go in and build an online reputation fast. Number one, build your online reputation. Go in slow. Remember when you were small and you went to all the B&I meetings and the Chambers of Commerce meetings and you posted all on Facebook because you had the time to do it. And you went to church and you talked to everybody and got them to do the paint jobs because you're a painter. You need to have that same mentality. If you're going to go in and do Greenfield, you got to find people that will have that same boots on the ground mentality, those grassroots approach. And if you could do

that, you'll be successful. It's hard to replicate that. That's why a lot of times Greenfield just takes too damn long. I could go out, check this out. I buy a hundred companies at 300 grand and I'm going to leave them with a piece of the pie. So I buy 300 grand. I bring them up to 900 grand, a hundred businesses, three years, boom, a hundred businesses, 33 a year,

33 a year is roughly three a month. And I got a whole way of doing this. Not a tough thing. If you got a whole team designated, you got to build a team that just does the acquisitions and they get everything. They bring in the HR, the financials

everything so you get it three years you do you know around 30 33 companies a year you get them to 900 000 let's just round 300 grand you're up to 900 grand let's just round that to a million 100 companies at a 20 times multiple you got 100 companies to a million dollars, you're worth $2 billion. You can't do that, Greenfield. You can't do it fast enough. Every private equity company in the world, they raise billions of dollars to be able to do this arbitrage because your cash flows are so high. Now, as you're buying companies, here's one thing you're going to realize. You're going to learn stuff from them. You're going to learn, oh my gosh, they got this store locator that's getting 10 leads a week. They do this booking thing that we didn't even think

about. And it adds 10% to the ticket. They were able to cross trade this guy to do this. So I can't tell you, I like one more than the other. I can just tell you Greenfield's awesome. It's way cheaper. If you could do Greenfield greenfield freaking do it i like the hub and spoke model i'd like to buy and my new plan is to buy the hubs like a for example buy a detroit company i'm already in detroit so i wouldn't do that but buy a big detroit company and then break off to lansing and then go into uh grand rapids and kalamazoo so i'd have the spokes the hub would be a company i bought and the spokes would be the other ones. How do you do the opposite of rewards like the ding, the bonus, or just write up?

One thing I try to do with write-ups is just say, hey, I'm going to make a note of this. You didn't do your job. It's not a big deal today, but I want you to know it's in your file. Next time we're going to have a serious discussion about it. I'm going to give you a day off. And I'm not very far. If this continues to go down this road, it's give you the opportunity to work for one of my competitors. But here's what happens is you should micromanage these guys at one-on-one talks and make them so accountable that they want to quit or they want to conform. If you don't have the ability to manage that tightly, then you're not doing something right. Can you do the video review with a bank without the bank involvement? No, no, there's no point.

You want to get this stuff listed on their site. So I call them up before I do it. You know, I sat with my video guy and did 100 reviews. And I had him edit them all and send them to the people and say, you know, I know I'm one of your valued clients. Would you do me a huge favor and put this on a site? And then they have this, you know, they got these things you want to, you go through one by one. They want to make sure that it's all in compliance and stuff. But I'll tell you this.

If somebody said, if you got a great review, why wouldn't you give a link to that? Like if you guys send me this awesome raving of you and you tell me how awesome the podcast is in the book and I can put it on social media and everywhere, why wouldn't I? That'd be stupid if, you know, make it a win-win. I win. People out there are going,

geez, this guy gets more compliments than anything and I'm showing it on my website. That's a win-win situation. Anytime where I'm going to make a deal to buy out a company, it's going to be a win-win. And I plan on doing the fattest roll-up that's ever been done in the home service space. I want to talk about some books real quick. This book was written in 1995.

Double Your Profits in Six Months or Less by Bob Pfeiffer. Read it. This is the most important book you'll ever read, other than The Home Service Millionaire and maybe a couple other ones. This has just jumped my list. It literally gives you 78 ways to cut costs. We're implementing it. I can tell you this. I was with a group of about 20 contracting companies, and there was a guy that walked up on stage, 300 million plus. He recommended this book. He said it saved his company. And it does. It's an amazing book. It's a game changer.

There's two ways to make money. Either you bring in more revenue or you cut costs. I'd suggest trying to do both. There's a certain point when I'm just like, grow, grow, grow, grow, grow. Who cares about costs? But then you're buying frivolous, crappy things that you don't need. So just keep an eye on the expenses. I think that's the most underrated thing of, you know, he talks about cutting the office supplies, the staples and the paper. People learn to not print. If you cut the paper expense, cut it by 50% and he guarantees it'll work. And it's, I know it's all true. What else did I want to say? The other day, we're in a meeting, a great meeting, a huge meeting. And, uh, some of the guys who just told me that they're a little

bit overwhelmed and they're burning the candle on both ends and I'm, I'm giving them too much, too many projects. And I'll tell you one thing that's really, really important to me is I want to grow these guys that work for me, guys and gals. I want to grow them into really, really powerful leaders. So the first thing that I want to work on is if they're taking on projects that can't be delegated with 360 employees, then I need to work and find out why, because that's a bottleneck and we should have more depth within the company. So that's my first goal is to create depth within the company to make sure everybody has some of the people they can delegate to

and make sure it gets done using these steps, right? So keep that in mind. And then I want you to start looking at each thing you're working on and really building a quadrant of four and saying, how much time is this going to do? I'll put one on the Facebook group. But basically, what I want going to do? I'll put one on the Facebook group. But basically, what I want you to do is evaluate time. And there's only two things you're working on, profit.

You're trying to increase profit or you're trying to increase revenue. So how much input versus the output am I going to get? And arrange your projects in that. Less time, bigger profit or bigger revenue. So you got to be calculated. Very, very important. And then I said, well, what's the due dates on all this stuff? And what's going to make the largest impact? Some of the things might not make a huge impact. Some of them are a long shot. We're doing some things that I don't know for sure. We're getting involved in a lot of the Sam's Clubs across the United States. And I'm not 100% sure if we're going to make a gazillion dollars or not make any money.

We could be not profitable. We're going after it. But too often I find our managers going and going back to the, I got to work in the business. I'm just overwhelmed. Anytime as a business owner or a manager that you're not training other people, you're not taking the time to sit down and train and show people. They're not going to do it as fast as you.

You know, if you think you could do it faster and you're the only one that could do it right, you got a superiority complex and you need to go get checked out by Dr. Maybe Dr. Kevorkian. I'm just kidding. That's a bad joke. But if you think you're the only one in the world

that could do the company like you can, I think you're in a grave mistake. You and people say tommy couldn't run without service now i believe i could run with any tool because i can tell you this there's businesses that are way bigger than me that are running on archaic software look at look at the airline industry for example you can make anything work when there's a will there's a way so does the software help me yes the software does have you ever read the great game of business by jack stack i swear i have that on here i think i did read it the great game of business yeah then there's a one i think he wrote a couple books and actually alan roark told me to read that

um oh geez there she blows boom it's it's rare that i was able to find it there it is you know the thing is is if you guys spend more time reading you might, you know, a lot of people read and they don't enjoy reading. It doesn't resonate with them. People ask me, I was on a podcast earlier. They said, what's the number one thing you think you possess your number one trait. And I said, it's the ability to learn and always be the dumbest guy in the room. I travel today. Some people invited me out possibly on this trip to go visit them. And I'll tell you what, there's going to be a lot of value. I'm going to pick up a lot of things. Today, I called the number one financial guy I know. And I told him I'm getting into acquisitions.

And I said, do you know anybody you can introduce to me? He goes, well, I got a client that just sold for 2.4 billion in the flooring industry. Would you like to go to lunch with him? I said, yes, I would. So I'm willing to ask anybody for help. Number one, I don't care if I'm lost. I'm going to ask for, I'm the first guy to stand in line for directions. Just understand that. Have you already talked about your tips on setting up multiple physical locations for Google My Business to enhance your presence in a single market?

So if you wanted to get multiple tips for setting up multiple physical locations, you'd be like mattress firm. The deal is if you have multiple locations, hopefully your company's big enough to have employees that show up there. Like I'd have a showroom, depending on what you do have a showroom of multiple locations. There's nothing wrong. Do you think mattress firm gets in trouble by having 17 mattress stores in a Phoenix metropolitan area? No, they don't. Do you think that you could have a physical location an hour away and not get in trouble? Hell yeah. If you got them on every street corner, you're going to get zapped by Google. It's not even worth it. You're not building a brand to last, but if you want to be multiple Google, my business pages,

Phoenix is big enough where you can go far north, far south, far east, and far west, and have the employees report to that area. Maybe you have some inventory there. Maybe you have a CSR in each area. I mean, there's a million ways to slice the bread. So I talked about a lot of stuff here. I could end with a few thoughts. Go do your research and find a company that you want to become In your industry And if you need my help I'll reach out to them

And I'll get you a visit Don't you have a link with Forbes magazine website So I was an author For Forbes by the way So I wrote a lot of articles I was actually a contributor for Inc.com My first one that I remember writing was called, it was on passion. This was my first article.

And I wrote it from Young Entrepreneur Council, 2016. That was the first time I got published by a main deal there. And then I learned how to do it. When I was in 2006, when I first opened my two-man door business, I never imagined it would be 80 employees. Now there's 360 employees. It's kind of fun running down memory lane sometimes. But what I was saying

is get out of your comfort zone. Go visit another company and write down every freaking question. But here's the secret sauce. When you walk into that business, and if they're big, I want you to go big. I want you to go to the biggest. Don't be like, well, I'm going to go to the next step

and the next step and the next step and the next step. No, find the big mammoth, the one that you dreamed of being. And what you're going to watch is you're just going to watch the culture. You're going to see the air. You're going to watch. You're going to drink the Kool-Aid and you're going to go, holy crap, this is super cool. This is like, I love being around this atmosphere and then you're gonna go

hey you're gonna talk to the ceo and he's gonna be like come on in let me answer your questions that you're gonna go wait a minute dude how are you aren't you busy you got like a thousand people working out there no no hey melissa will get us some uh two drinks and a watermelon whatever they're gonna be like super relaxed. They're going to have their time all scheduled. They're going to be very, very deliberate with their time. And they're going to answer anything you need. And then they're going to say, listen, I want you to talk to Mike and HR.

You'll get a kick out of the way we do our hiring. I want you to talk to Bill and marketing and nutrition recruitment. And then I want you to gather around. And then you got Jessica. She runs the warehouse. I'm going to check that out. I want you to show. I'm going got Jessica. She runs the warehouse. I'm going to check that out and I want you to show. I'm going to make sure you look at what we did with Six Sigma and we've actually went to Japan and learned the lean system in our warehouse.

These are the things that will change your life. You go there and you put a vision. Turn it into a vision. Turn your dream into a vision. Write it down on the whiteboard and then go for it. How do you approach someone who may be wanting to retire and sell their grocery business? Or how do you find them? Number one, use your vendors. Your vendors know everything.

Call a buddy of yours at the vendors and say, Hey, who's not paying their bills on time? Who do you know that would like to sell? My vendors love me. So I say, what's in it for my vendors? Well,

I sell better product. They make better margins. They look like the hero. So your vendors should be watchdogs for you. You approach somebody and you say, listen, I heard there might be an opportunity to work with you. The first thing they're going to say is who'd you hear that from? And they don't want their employees to find out about it. You do not want to be that guy or that gal. It's letting all the employees find out, oh, they might be selling the rumor start. You don't want that. So be very discreet. Show up there in an unmarked shirt, unmarked truck. You do not want to be that person that lets the cat out of the bag. And here's the best news I'll give you is tell them how amazing they are. Let's say they're a

window washing company. They might have soap from 20 years ago sitting on the shelf. Just say, wow, the fact that you still have that soap, it's the best quality soap. I'm glad you still carry it. Some people might be selling an air conditioning company. They might have 80 old AC units they've held. One of the things I learned from Ken Goodrich is tell them how amazing they are to be even successful and build a business that's worth selling.

That means a lot to people. You can't look at their life's work, the biggest decision they'll ever make, and be like, wow, why would you keep that stuff? I would never keep that. It's crappy. When you buy the business, you can do whatever you want with the stuff. You can say, hey, Mr. John, I love that you kept this stuff. And in fact, I know it's so precious to you that I'm going to let you keep it. So I know I shared a lot with you guys today. I enjoy this. Next time I'll read the questions a little bit better, but read those books I gave you. I gave you a lot of books.

The big one that I wanted to tell you guys about was this double your profits. Do me a favor. If you get a chance, when you read this book, I want to hear your thoughts on it. And let's do this every month. I had a blast. I'll answer all your questions. If you want me to get anybody in particular on to answer questions, I'd be happy to do that. I'm very, very excited to share like people have shared with me. That's the whole goal of this is to learn from others, the other's mistakes mistakes yours truly has made a lot of mistakes and i'm here to share them so appreciate you guys very much if you need anything from me don't hesitate to ask and i'm actually going to be putting on a garage door show out here in

november it's going to be the biggest and best garage door event that's ever taken place i'm really excited about it um if you're a garage door company let me know we'll get you out here i'm not i'm not charging for it you just got to figure out how to get here where you're going to stay but it's going to be the garage door show without any garage door presenters it's all about it's air conditioning and roofers and plumbing and guys that understand the home service business so thanks guys appreciate you very much if you need anything don't hesitate to reach out and I'll talk to you guys later. Hey guys, I just wanted to thank you real quick for listening to the podcast from the bottom of my heart means a lot to me. And I hope you're getting as much as I am out of this podcast. Our goal is to enrich your lives and enrich your

businesses and your internal customers, which is your staff. And if you get a chance, please, please, please subscribe. You're going to find out all the new podcasts. You're going to be able to ask me questions to ask the next guest coming on. And do me a quick favor. Leave a quick review. It really helps us out when you like the podcast and you leave a review.

Make it four or five sentences. Tell us how we're doing. And I just wanted to mention real quick, we started a membership. It's homeservicemillionaire.com forward slash club. You get a ton of inside look at what we're going to do to become a billion dollar company. And we're just, we're telling everybody our secrets basically. And people say, why do you give your secrets away all the time? And I'm like, you know, the hardest part about giving away my secrets is actually trying to get people to do them. So we also create a lot of accountability within this program. So check it out. It's homeservicemillionaire.com forward slash club. It's cheap. It's a monthly payment. I'm not making any money on it to be

completely frank with you guys, but I think it will enrich your lives even further. So thank you once again for listening to the podcast. I really appreciate it.