The Home Service Expert Podcast - The Seven Superpowers To Supercharge Your Home Service Business

Episode Date: February 14, 2018

Al is President of The 7-Power Contractor, a business consulting and training firm that has helped hundreds of home service businesses. Plumbing & Mechanical Magazine named him one of the 25 most influential contractors in the United States. In this episode, we talked about business strategy, marketing, acquisitions…

This is the Home Service Expert podcast with Tommy Mello. Let's talk about bringing in some more money for your home service business. Welcome to the Home Service Expert, where each week, Tommy chats with world-class entrepreneurs and experts in various fields like marketing, sales, hiring, and leadership to find out what's really behind their success in business. Now, your host, the home service millionaire, Tommy Mello. Before I start this interview, I just wanted to say thanks for all the positive feedback that we've been getting since our launch date. A very special thanks to Church Blissett, who left one of our first amazing iTunes reviews. He mentioned that it was a great podcast with

several experienced speakers, and that feedback really meant a lot to us. Look, our main goal here is to bring the top entrepreneurs and experts to you so you can learn from the best. Now, if you have a few minutes, we would really, really appreciate your feedback. Just go to iTunes, leave a quick review, and help us make it better. Thanks again. Hey, guys, welcome back to the Home Service Expert. I'm here with Al Levy. Al's been through a lot. He's been consulting now for 15 years. I like to start the podcast with a simple introduction about where he's been and what he does today. So Al, thank you very much for coming on the Home Service Expert. How's your day going? My day is going great. Since we're both in the same time zone, it's a beautiful morning in Arizona. I love it. The weather is finally getting better for us. That's absolutely right. So, Al, we've talked a little bit just previous

to this podcast, and I think you've got a pretty cool story. You started out with a family business. Tell us about where you started and kind of what you do today. Well, where I started was my business was started out of my grandfather's gas station in 1936. My dad and my uncle grew the business. It was a heating business. And for those who know the Northeast, it was fuel oil heating, which if you're not in that area, think propane, same idea. And then my brothers, my two older brothers emerged, came to the business. And then I was the last one in, but we all grew up in the business. That's classic family business, plumbers, heating, cooling guys, electrical roofing.

We'll know what I'm going to say next is as a kid in the business, you know, you're used to emptying garbage cans and sweeping up the floors and every other little path that you can do. And even when I was in high school and college, you know, I was always working. And I always tell the joke about my dad's idea of a spring break was he gave me a different truck to drive. He was. Yeah, I grew up fully immersed in the business. And my dad had an interesting approach, which was he believed that you should never ask

anybody to do anything you haven't done yourself. And as a young man, I did not appreciate that. But I did understand the wisdom later on to that. So I went off to college, came back with my engineering degree, of which I never practiced one day. So before any listeners get upset, I don't know why I went to college, but I came back to the job I had. And while I was working the whole time and came back and I showed my dad my degree. And he says, I'm very proud of you. Here's a toolbox time to go to work with my introduction. And I was lucky enough to work in every bit of the business. But every day, Tommy, it was just we thought we had a fire put out and it would break out the next day.

And we just kept living the same nightmare over and over again. The one great thing is we were making good money. And the worst thing I think in this business, any home service business, is that if you're going to work that hard and not have money at the end of the day or worse than that, go broke. It's awful. So when the time came, I put systems in place. Everything in my business became systematized. I'd solved the biggest issues about planning and staffing and creating good staff solved the biggest issues about planning and staffing and creating good staff because the guys were getting older and older, and I needed to get good, fresh, young blood in. And I was writing for a magazine, a trade magazine.

People got to know me, and for the last 15 years, I've been traveling all over the country and even Canada, for that matter, and doing workshops, seminars, and also one-to-one consulting and taking these systems. The original name of my company was Appleseed because that's how I envisioned myself as Johnny Appleseed going around spreading the seeds. And today I am the seven power contractor. And the reason is because there are not a million things to learn in this business. It feels like that, especially if you're thinking you're missing something,

but most of us are not. There are seven things that I preach, and that really is how I got to take control of my business. And that's how I help contractors and home service-based businesses do the same thing. Yeah, let's go over, just because we're going to be talking about those throughout the podcast. Tell me a little bit about the seven powers. So, the first of it is planning power. And planning is, you know, if you don't have a plan, then you are planned for. And that's pretty much the nature of it. So years ago, I came back to the office on a crazy busy day and I'm looking for somebody to help me with a project. And I'm going literally desk to desk. We're a company of 70 people,

by the way. I'm going desk to desk. Everybody's too busy. So I just blew a fuse. And I said to everybody, grab whatever you're doing, come into the conference room. And this is a long time ago. So everybody had paper and they're dragging stuff in. And I said, just put it on the middle of the conference table. And we started to dig through this big pile. So image that in your head. And we started pulling out all this stuff. And what we found out quickly were there were two people working on the same project and neither one knew the other one was working on it. And then there were other people working on projects that they swore were highly important to me. The bad news is I didn't even know that that project was even out there. And it was just a mess, but it was the greatest day ever because it allowed us to create, think of a funnel with the top being wide. We

created the most important thing for us to take control of planning, think of a funnel with the top being wide. We created the most important thing for us to take control of planning, which is a master project list. And this master project list contained all the great ideas, projects, habits, because it's not about ideas, it's about implementation. And so we had the top of this funnel. And then the way we worked it down that funnel is it either had to solve the biggest problem or challenge or greatest chance to grow and be profitable. So think of two giant strainers. So we strained the big list, which was about 100 to 125 items. Not all projects.

Some were good habits, learning how to delegate. That's a discipline. These are all habits you have to learn as a business person. And so we got down to our 30 and the 30 Tommy would be, if I was working with you a year from now, how many of these 30 projects that you said would solve the biggest problem challenge or give you the greatest chance to grow and be profitable actually got done. Sure. But that said, that said, Tommy, you cannot work on 30 things. I don't care how big you are. I don't care how much money you have. If you try to work on 30 things at the same time,

they're all going to not get the attention they need. And there are only three things in the universe, time, energy, and money, and there's no way you can devote it. So once again, we take this 30 list and we use the same filters or strainers, solve the biggest problem or challenge, greatest chance to grow and be profitable, and you arrive at your top five. And the top five says that if you worked on these five things, that would make the biggest change for you, help you solve biggest problem, challenge, grow and profitable. So no matter how crazy your week is, I don't care how much work you have or what you want to do. So a portion of your week has to be devoted to making that top five come alive because you said if you did, that would have the power. And as you crank out the five,

you begin to address the 30 and keep on working your way through. And that's how the company that I work with, including my own, did it. So planning power in a nutshell is working on the right thing at the right time in the right way. So I call it the three rights. That's what planning power is. I love it. So what's next? The next thing is almost always, always on that top five is systematizing your business.

So if I gave you five great plumbers, could they go to five great jobs that need a toilet reset? Could they all do it the same way the abc plumbing the answer is no if i had five crews going to five different job sites to install roofing and you never defined it in writing could they do it the answer is no or garage doors or anything else of that matter so the idea is to systematize or to get in writing out of your head so people don't have to be mind readers at your company is that no matter what position, and this goes to the organizational chart, but for every box on your organizational chart, not the fancy title boxes, the boxes it takes to

run your company, each of those boxes have a manual that describes 80% of what you do, that you will never cover the 100. The goal is only to get the 80 routine that you do all the time. Because if you can do the 80 consistently, the 20 doesn't throw you for a loop. So whatever that work is, you need to define in policies and procedures in writing. And in my case, with my manuals, there's nothing longer than a page because it's not like you never did plumbing, you never did a garage door, you never did electrical. Here's a book. Go get them. You are already trained or we're trying to get you to do it in our way of doing it, the ABC or the XYZ company way of doing these things. And that goes for your accounts receivable person,

your accounts payable, the customer service rep, the dispatcher, the techs need to know what they need to do from the time they wake up to go to bed the techs need to know what they need to do from the time they wake up to go to bed, other than the actual trade work that they do. So there's that. And when you're bringing on apprentices, which is what I always did, so I stocked upon the young, willing people

and provided the skills, which totally changes things. So operating power is documenting the policies and procedures in an objective way, which is the only way to run the company. Sure. So what's next? What's next is staffing power. Staffing power is the ability to find good people and get them trained up. But here's what it really starts with is if you have policies and procedures in writing, you have systems that are documented, you can begin to fill the holes in your existing staff. And what I mean by that, there are holes in their knowledge

that they're never going to show you unless you make it safe. And how do I know that's true? Well, I was the second best tech out of 25 techs at my shop. And there were things that I was not confident in, Tommy. And I would spend time talking customers out of doing certain things. And this is the boss's kit doing this. So you can only imagine what your staff is hiding from you today. So with manuals and training and making it safe for them to share what they don't know, you can find and fix the hole. So that's one. The second one is, and everybody's experienced this, when you have a job interview, Tommy, and you sit with somebody and go, so you know everything about electrical?

Yeah, do it all the time. You know how to do a toilet reset? Yeah. You know how to install kitchen cabinets? Yeah. Accounts receivable. You really good at QuickBooks? Yep.

Until, of course, they arrive and you find out what they really do and don't know. So the goal of this is find out what your new hire really do and don't know. So the goal of this is find out what your new hire people do and don't know faster. And that is really what your goal is there. But the real relief and the reason I was able to leave my business 15 years ago is I got so good at taking willing people and providing the skills, which totally changes the staffing dynamic, because you're going to run out of quote-unquote experienced people.

And if they are experienced, you have to take what comes with it, which more cases than not is a prima donna attitude where they're coming to you for extra money and as soon as somebody else is willing to give them a little bit more, off they go. And that's really what staffing power is about. It is also a new concept

that follows the following five things. We were not always born this way. It's so smart of Tom to know this. My brother, Marty, who is a financial guy, used to laugh about our hiring process because we didn't hire anybody until somebody quit. Sometimes we'd be lucky. The keys would be in the truck. We'd go get the keys. And sometimes we had to go find where the truck was before GPS days. You know, it was that kind of thing. So Marty had a line about that. We had a mirror, M-I-R-R-O-R test,

which meant if you could breathe into the mirror and fog it, you were hired because we were desperate. And so once we learned how insane that was, we got proactive, which means you're always recruiting. You're always hiring. you're always orienting, always training, and always retaining five things. That is really how you master staffing power. Sales power is next. So sales power is just the people in your company. So tech's making good recommendations to the customer, but they have to have a process. Just like you do your work, you can't skip steps. So my sales process is a five-step process that is repeatable so that they have a process of how they get to the door, what they ask,

how they do it, how they proceed through the call, how they quote a price, how they do the work, and how they exit properly. That's really what you want in sales is quality, ethical sales. And that has to be trained. I am not a believer in the born salesman. I was not a born salesman. I went for enough training and I had enough desire to become really good at it. So tech sales, big ticket salespeople. And if you're in the commercial side of business, then there is a commercial sales agent. So sales power is a repeating system that helps you get to good ethical sales, which are always in the customer's best interest. That's what selling power is about. But there has to be a reward. There has to be a reward for that, which is sales coaching power,

which is if you're never going to check my homework, there's going to be a problem. So you have to get out in the field and do ride alongs with people. You have to have mystery shoppers, which means they don't know who they're going to, to find out if they're following that process. And it needs to be coaching about what their average invoice is, how efficient are they on labor. Because I can bring you all the money you want, Tommy, out of my truck, but you're going to go broke because I'll just work enough hours and you'll pay me enough overtime. So there's a reward system that needs to be in place.

And there aren't a million statistics to this, but the billable hour efficiency or labor percentage of sales, what your average invoice is, how much you want per week from that truck is a good example, and how many callbacks for the calls they run are you willing to tolerate? And this is where sales coaching power begins to make a big difference.

Also on big tickets, years ago, my big ticket salesman proved to me they could bring me a million dollar sales, no problem. Problem is that every job they sold, I lost money. And I didn't like that. So I changed the way we did that, which is you have to project how much material and labor as a big ticket salesman and the inside of the office, they're actually tracking how much material and labor did you actually spend on this job? And did you hit your gross

profit target? Whatever that gross profit target is. Typically in the contracting business for us, one that I work with, about 50% gross profit. So we are not just doing install work for exercise, we're doing it for money. And we also want to find out how many of these jobs come back. So the installers and the install manager and the sales manager and the salesperson have to work together for anybody to win. And of course, the installer gets rewarded for bringing jobs in on time on budget. They don't have a choice about the sales, but they can make the make or break the job. So it's why Ellen calls her system reward the right stuff, because that's what we're after. We're trying to reward the right thing. So what's next beyond that is marketing. And marketing is one of the things that I love, which is you can do everything I've said so far, and if the phone doesn't ring, you're going out of business.

So marketing is that funnel thing again, which is the bigger and wider you make the top of the funnel, which means more calls. You, the contractor, get to be choosy about who you go to and for how much money. So your goal is to get more calls than you can humanly do in a day so you can charge the right price and spend the right time in front of the right customers and qualify the people that are calling you, not running to everybody, because not everybody is your customer. One of the hard lessons for me, Tommy, is to learn that. I grew up on that, you know, everybody's your customer and you've got to answer every call. And I don't believe in that. I don't believe in that anymore, any bit. You want to be in front of the right customer at the right time. That's really what

we're after. Those are the people that appreciate your cleanliness, the fact that your criminal background, drug testing, any of the things that differentiate you, or the fancy term USP, which is unique selling proposition, where do you go into market? And I grew up in a commodity business, and my whole goal was to take it out of the commodity business and add value to it. So I got really good at that. But that's really what you're looking at, is the right amount of calls from the right customers at the right time. What I call the three rights of marketing. And that requires a marketing system, which means there's a marketing plan in writing and that you have a budget. And I like percentage of sales because the numbers get scary as you grow. So, you know, if you're a $30 million company and I tell you, you need to spend 10% on

marketing just to be, you know, average aggressive, that's 3 million bucks. That will scare you. But if it's a percentage, you know, that's really how I've helped companies over long periods of time keep enough marketing fuel in the gas tank to keep those calls coming in. Marketing budget and marketing allocation, which is what are the three main drivers you want to go to market with. And what I mean by that is instead of a shotgun approach, having a rifle shot gets the majority of your money so that you can have a deep enough impact.

Is it search engine optimization, which I'm a strong fan of, which includes pay-per-click? Are you in some markets? You know, television being on the one news show is really helpful. A radio campaign used seasonally. There's a lot of different ways. While there's no shortage of ways to go to market, but every market is not necessarily the same, but there are enough commonalities to it. I'm a giant fan of acquisitions. If my dad and uncle hadn't been into acquisition, it would not have been a business by the time I

showed up. And acquisition, in my belief belief and has improved with everything I've used is still the best chance to really grow your company, but it has to be done right. It's like everything else. You have to learn how to do it. So that just leaves one more, which is financial. So you could have done everything to this point, Tommy. Yep. And if you don't know how to keep score and you don't know how to charge enough money for what you need to do, and you don't know how to charge enough money for what you need to do and you don't know how to do a budget, you're always going to be chasing the money if you're lucky enough to stay in business long enough. So the financials is what Ellen calls is looking, not the stuff you get from your accountant, which is rear looking and avoiding taxes or minimizing taxes, which is all good.

But in today, because you know how to run your business and make adjustments today based on the financials you're looking at? So that's the seven power concept. I love it. I wrote down way too many notes to even stay organized right now. I think this- Well, the good news is

if you go to my website, there's a cheat sheet for this. So for those who are listening, yeah, that's something we can help you with. Yeah, we're going to talk about that. We're going to put them on our website, too. We're going to have a whole page dedicated to you. We're going to have this whole audio on there and ways to get a lot more from you.

Obviously, the goal here is not only to educate people, but to give them access to you and to get more of you. And obviously, tell me a little bit about Alan Moore and how you guys teamed up. Yeah, Alan Moore and I met back in the 90s when it was C2000, which was the forerunner, then became Nexstar, which is the big affinity group in the plumbing, heating, cooling, electrical field. And we became fast friends.

And Alan was a devotee of an industry giant, Frank Blau, who was, he and another fellow were the first ones that we had ever heard of flat rate pricing. Before that, it was time material and not really. Most of us understand if I pay a tech 30, 40, 50 dollars an hour, I have to account for that. But we don't account for all the other things it takes to be in business. Like I was talking about marketing, the cost of, you know, putting staff in place, the lights, the heat, the insurance, so many hours in a day to build customers, because that's where the money comes from. And you have to be able to know these things in real time to come up with the right selling

price. And that is where, you know, Ellen has been really great about teaching that. And also then allowing people, people always tell me, want to go, oh yeah, I need a reward system. And I go, well, do you know your financial position as of today? Can you know all this stuff? No, no. I said, do you do budgeting? No. I said, well, you can't have the reward program because you wouldn't know if you're rewarding people with money out of your pocket or the money they create. And a great reward system is always rewarding employees with the money they create, not money out of your pocket. So financial power is really the big thing here. And that's what Ellen does. Amazing. I love these principles. And I want to ask, you know, you've been rated one of the top 25 most influential contractors between plumbing and mechanical magazine. Tell me a little bit about what you

think got you to that spot, because what I always tell people, it's not about the stuff I do well. It's about the mistakes I've made. And the definition of insanity is doing the same things over and over and expecting a different result. And I think what shaped me the most is the mistakes I've made. Tell me a little bit about that. Tell me a little bit about some of the stuff that you've gone through and some of the stuff you might have witnessed of other businesses that really helped shape those seven powers. My dad was a serial entrepreneur. And by the time we were, my brothers and I were young teenagers, we were in business meetings.

We were sitting in the room while he was doing business. And we owned an ice cream shop. We had a multi-state liquor store. We had a multi-state real estate business. We owned a radiant heat manufacturer, a computer software business. So we weren't just, you know, contractors in that way. And my people would always like to tell my, my dad, oh, my business is really different. And he would hold his thumb and forefinger like a millimeter apart. He goes about that much because he understood, you know, there are certain things

you have to do no matter what. So in my business career, here's how I would pretty much sum up the not unlike what you were sharing. There were sometimes I did things and I made a lot of money and that felt good. I enjoyed that. And sometimes I would do something and stretch and we would break even and that was okay. And sometimes I would do stuff and lose money. But here's what I can share today. I learned my greatest lessons in the last scenario where I lost money and things

didn't turn out right. And in that moment of pain, I wrote down, you know, okay, what did I miss? What did I not see? What things would I do differently? And kind of did a postmortem about what it is that I need to do. So one of the mistakes that I feel entrepreneurs make, people who own businesses, is that you took a risk. You could have had a job and had a paycheck coming. But all of a sudden, you don't want to make another mistake.

And that in itself is a mistake. The nature of the business is you always have to be stretching. I'm not saying to go wild, but you do have to kind of exercise like a muscle. You've got to exercise your entrepreneurial muscle. And that does mean taking calculated risk and good gamble. But it goes to what I was sharing earlier.

That's why planning power is first, Tommy. You've got to have a plan. So I'm an average home. Let's just paint this scenario. I'm a, let's say I have a landscaping company. Obviously, I'm pretty familiar with everything you said. And I wrote down so many notes and so many good questions that I'm going to be asking. But we talk about planning.

Tell me, I've read the E-Myth. I'm a big fan of it. I buy the book for every single one of my managers. It's the E-Myth Revisited by Michael Gerber. It's just, it's basically for the guys out there and gals out there in the home service business. It's a great book to start with because it just, it gives this analogy of a gal that's always working in her business instead of on her business.

And we find ourselves trapped. We're there all day working in it. And it just explains that you've got to have checklists and you've got to have procedures. And, you know, Marcus Lamone talks. He's the guy, the prophet. And he talks about people, process and product. Well, I believe in process, number one, because the process helps get the people. If you don't have a process in which to get the people, then you're not going to get the best people. Now we do drug test and background checks,

like Al talked about. But, you know, the E-Myth just really talks about having a vision and setting up for planning. And I really, you know, let's dive into that a little bit. So I'm a landscaping company. I'm getting started. Walk me through just what are my first steps to just getting the plan together? Obviously, you said you put the impact areas. I call them impact areas of the business. And you're talking to yourself the whole time trying to figure out what am I going to need to make this business successful? But really, where what would you say is if you had to give me the short notes on it? So if I'm going into this business, the first thing is to make an objective evaluation about what do I bring to the landscaping business that sets me apart from everybody else?

If I'm just going to be like every other landscaper out there, then I'm worth no more money than anybody else. And there isn't a reason. So are you going to specialize? Is there some niche that you do? Are your guys better trained than anybody else? What are you going to do if I gave you, you know, a loudspeaker in Times Square, New York? What would you be shouting out to everybody that says, hey, this is what I do different, change the landscaping landscape?

You know, you have to be able to think about that. And what is it that you want your company to be? You have to kind of envision it first before it can even happen. So by having a plan about how many trucks do you think you'll have running? How big a company do you want to be? How many hours are you willing to commit to your business?

How are you going to find a family work-life balance that you're willing to do and for how long? And so this is a little bit of strategy before planning, which is coming to the marketplace as to what is it that you're going to be willing to do and what is it that you want us to do? And they talk about, you know, the end game statement, which just means when you get finished building, what does it look like? And it sounds weird because you're just getting started. But if you can't envision it, it's hard to make it come to reality. Does that make sense, Tommy? Absolutely. And I think that most people don't understand the fact that you're not building a business necessarily every day to sell it. But the fact is, you should always run the business like you're going to sell it because it's kind of like a vehicle. Yeah, you might not never sell it, but if you do have to

sell it, do you want it to be dented up, not never oil changed, have the worst tires on it, or do you want to take care of it? And if you view it in a way that if you were to sell the business tomorrow, what would you do? Well, you get rid of this person because I've been wanting to get rid of them and they're pulling my P&L down. And then I do this, I do that, I do that. And if you run the business that way, I really think it gives you quite an advantage over other businesses because so many people hold on to the excess because they feel bad and they cut marketing first. And that's the death pill, in my opinion. Yeah, I so hear that.

And I think that needs to stop one second yeah i've worked with large companies and the times change and what's the first thing they cut is marketing which is just insane and actually my dad used to not spend a lot of money when things were really going great and as soon as the things would downturn that's when he really put the marketing uh foot to pedal, if you will, because he knew that his money would buy even more, and you have to be marketing in the slow time even more so. And it's counterintuitive to what you're thinking. And it's really, I've watched this go on too often, where it's kind of like, you know, when things get tight in a building, for instance,

what's the first thing they do, Tommy? They cut the maintenance, which only creates more problems down the road and going to cost more money in the long term. So, yeah, this is sometimes it's a weird thing. You know, what you're thinking is not necessarily looking out and marketing all the time is something you need to do. Well, marketing, especially in slow times. Here's the deal. Listen, when you're doing stocks, when you're doing real estate, we've all been, we've heard about the bubble. You know, me and Al lived through it. We're in Phoenix, Las Vegas got hit hard. Everybody's buying. You should be

selling. Everybody's buying stock. You should be selling. It's hard to know when you're at the top of the mountain, but you know, I've dealt with a lot of people. I sell leads. I actually work with direct energy on a lot of different things. And let me just tell you, the best way to take market share is in a bad economy. Do you think Donald Trump made all of his money buying at the top or do you think they were able to buy at the bottom? Listen, everybody that bought in 2010 and 11 in Phoenix is multimillionaires. Everybody that bought in 2008, seven, six and seven, they all went bankrupt and now they're renting. So literally, you can't take this for granted. Al's absolutely correct. We don't want

to, of course, advertise, take advantage, ride the wave, but put that money away. I always say you've got to have access to money before you need the money. So right now I have a huge line of credit and I don't really take a lot from it because I know when, cause you can buy companies up for nothing. And I want to talk a lot more about acquisition in a little bit, but when we talk about planning, you know, I always say there's three ways to make money. You could get more customers. That's through everything that Al talked about that you could keep the customers coming back for more and more often. And that's an art. Some of those are service agreements, and some of them are just proactive systems of reaching out to the customers,

text message, send out cards, emails, voicemail drops. And the third way is to charge your customers more money, and that's by adding on products. That's why Direct Energy could do air conditioning, plumbing, electrical, and sell you a home warranty. So if you're talking about how you can make your company different, I recommend looking into those three things and saying, which one of these things is my goal? Am I looking to be on the high end or the low end? Because if we look at Toyota, for example, Toyota has their regular vehicles.

And then what is it? Lexus is their upper. Yeah. Yeah. Yeah. They have two different brands. And when you really look into things, there's the high brand and the lower brand. And you can't be everything. So I think the rightful approach of what you talked about is great.

I just, when we talked about marketing, I think it's really hard to have a rightful approach in a market you've never been in. Correct me if I'm wrong. But I think you kind of have to. I'll give you an example, Al. I just launched a Christmas light business because I'm buying Christmas lights cheaper than Walmart gets them for and they're better quality. So it was something I kind of just got pushed into that. I mean, it's impossible to lose money, but we're testing out almost everything. Doorhangers, we're doing SEO, Facebook, PPC. We're doing Valpak, Money Mailer, Sororo Gold, You and Your Home.

We're doing email blasts. We're doing signs, TV, radio. And my big thing is I need to learn the market because it's pretty much universal. Yeah, this stuff is going to work, but I want to know what my avatar looks like. Is my avatar the perfect customer? Is it a cookie cutter home that we could be at for an hour and make a certain percentage? Or is it those huge homes like where you live in Paradise Valley, but the customer says, I want this, this, and this. You know, we just did a house for $25,000, but it took a week with five guys on it. So it depends. What's

the opportunity cost? Are we going to get a lot of the neighbors? So tell me a little bit about the rifle approach versus the shotgun approach. Well, this goes again, be aware that I've worked with companies where I sat at their dining room table with the owner and his wife was also on the job. I was playing with grandchildren to companies that were 200 people and bigger. And I worked with a condo builder who was $85 million a year. So I've worked the spectrum. So when I use an approach like that, I'm talking about companies who have been in business for a while, that rifle approach, which is just throwing money out. That said, years years ago and I'll

touch here it's best of the story so we were serial entrepreneur acquisition was a key thing because if my dad and uncle had not done it years ago it would not have been a business by the time myself and my brothers had showed up because the area had gone through urban renewal we lost our customer base and we had to go to where the customers were and my dad and uncle figured out by buying an existing company and getting those customers where they lived that was a thing and thank god they did because that was a big save for us and then we found out it was the best cost per lead and all the other good things that were and it was talent and there's a million good reasons for acquisition but the the thing is we used to keep the name of the companies we acquired so we have all

the house of brand names and uh one day i'm at a super bowl party up the block and uh being typical new yorkers i hear two new yorkers get into a fight you know they're having this verbal outrage thing and you know when you don't know what you're talking about and it really gets loud and of course i'm curious that i walk in to kind of hear what they're saying. What they were saying was, I have the best heating company and you don't know anything. And the other guy goes, you wouldn't even know where to find your boiler if I took you down there. And so I asked the two of them, which companies do you use? And here's the frightening answer. They both used me and they did not know that the other company was the same brand. So that was a bad thing.

And I went back and told my dad and my brothers the next day and we immediately hired somebody to help us rebrand ourselves to one name. And that was really a good learning lesson. And the person who I worked with was kind of was my marketing guru, Leo, told me about that you have to get behind it. And what we did is what we call burst marketing. So we were on the buses, we were on billboards, we were at the train station,

we were on the milk cartons, we were on the radio. And so we put all of this in versus a drip campaign, which is just a little little little little little because he wanted to really hit this impact there was nowhere you could go in our service area in this short period of time where you would not encounter our new name and of course we brought the customers up to speed so that's there is a time to do what tommy's talking about here uh and the way that he's going to is to explore the market and find out what is. The key thing where we both meet is you got to measure at the end of this what's landing and what is not. Because you want to divert more money to what is working and less from what is not working. But if you want to go in and you want to make an impact and you're a brand new company, you got to figure enough money to do something like what Tommy's talking about is surround them because they're not thinking that you, Al's landscaping is the company they have

to use. Does that kind of tie them together better, Tommy? That's perfect. And you hit two major things that I really want to learn a lot here on the acquisition side. So I got a few questions about that. But when we talk about measuring, setting up a CRM, I think, is the most important thing of your business. That's the customer relationship management system. And a lot of times we cop out and we say, well, this is the one we're going to use till we reach 10 or 12 or 15 technicians. And that's a mistake because the pain points of changing is so strong that I recommend going for what you're going to be like as a million dollar, $10 million company. And I can tell you this right now,

my CRM is building artificial intelligence. It speaks to the bank. Literally, it talks to the bank and does all the reconciliation. We just got certain alerts to check on things. It gives us updates, text messages. If our driver's speed, it tells us exactly how long the average guy takes on a particular job. So if he takes too long compared to the other ones and he's an outlier, we can work on his efficiencies. So the CRM, in my opinion, is the single most important thing growing forward. It's 2017. Yeah, you could get away with invoicing, paper invoices, but you give me till 2020 and you will be out of business. I have over a thousand tracking numbers.

I can tell you the revenue profit. I can tell you, because I put three numbers and Al knows this. I got a 623 number for the West, 602 for most of Phoenix and 480 for the rest. And what I've done is with ValPAC, literally, I look at what got the most calls, 480. If it's 480, I only use that number. And then I use the 10,000 base, which is 10,000 per zone, and I make it local. So if it's Mesa, I put all the local Mesa communities in there. I put a couple. I give the thing to make it feel like a local company.

And guess what? Since I did this, I do a five times multiplier on that one little Velpack coupon that I did before by just shotgunning it out there. And that's the rightful approach I think Al's talking about. And let me just tell you, we talk about A-B testing. Most people talk about Facebook ads and email blasting and obviously Google PPC, but it also exists on paper and it exists on signs and it exists on your truck wraps. And really, you want to get a sample size and study this stuff and team up with bigger data companies. But, you know, Al, I'm so interested. It's like you coming on today is God sent for me because I'm getting ready to pick up two not large companies.

One of them does two million a year. One of them does eight hundred thousand a year. And one of the things about these garage door companies is they do things that I'm not very proficient at. They sell high end custom doors and the other one sells gates and high-end doors. And they're in, one's in Flagstaff, one's local here. And I wanted to keep the Flagstaff name the same because he's been around for 45 years. He's built a relationship in the community. They're doing over $2 million in that local community. And I want to know i'm

a1 garage door service let's just call him al's garage door service because the deal's not done yet tell me a little bit about your perspective because i'm worried about a couple of things number one i'm worried about the transition because he does paper invoices he's never even heard of a crm and i'm worried about this name thing now that you brought that up so tell me the pros and cons let's just do a SWOT analysis on it. Okay, so let's start with the easier one, which is the name. The fact that I know this service area, and they're two hours away. If I'm in the Valley, there's a good chance I'm going to know A1 between Google search and everything else. So if that were here, I would tell you that sooner rather than later, you'd

have them write a letter on their letterhead talking about the great merger with A1 who can provide all the great service. And, you know, if they get home and their daughter doesn't work at 1 a.m., they can call somebody who will come out and fix it. And that would be the transition strategy if they were here. The fact that they're two hours away, there's a disconnect in the market. You are wise to keep their name until you begin to build bigger around it. And your marketing works everywhere in the state of Arizona. So that would be how I would advise you on the name change in that scenario. And again, if you happen to start acquiring down here, the difference between the two, does that make sense,

Tommy? 150%. I love that. Excellent. And so the second question that you had. A lot of people fail. You know, you talk about acquisition. We're going into our ninth state. My goal is to be in 20 states. I want to be over 50 million by next year. We're making strategic long-term growth.

We're thinking about EBITDA and all those major things. Let me ask you, I talk to a lot of people, buy through acquisition, but I think there comes a time and recognizing who you're going to acquire. And I know that the majority of acquisitions, the transitions kind of fail. And that's because it's kind of like paper or what is that, water and oil. Some of the times you go in and they just don't. There's a cultural shift between the two companies. So tell me, how do you deliver that? Here's what I'm going to tell you about that.

Acquisition is, think of a spectrum like a rainbow or whatever or a gauge from left to right. Acquisition can be as simple as buying a small company and just getting their phone number. When the phone number rings, it rings by you.

As soon as it converts, you write a check to whoever there is. That's what we call mailbox money. So for very small contractors, that's the way you can acquire them. If they're a bigger company, you could give them a little bit of money down and do the same thing with it. And the ultimate one is what I call a brick and mortar where I want to acquire because there's enough heft, like a $2 million company. That said, you're only going to be paying so many cents on a dollar. That doesn't mean you don't do the EBITDA and all the other accounting stuff. But ultimately, it's just a quick acid test as to how much I value this company. Is there somebody coming in here that's going to bring a niche that I do want to be in? Do they bring some expertise? Are they staying on? Are they leaving? Could I replace

them? How systematic you are at your own business allows you greater options when you acquire companies. So the better you are at your own company, it allows you to play way bigger in the spectrum on acquisition. That's what I've done and that's what I've taught. So, you know, I talk a lot about acquisitions and it's a great way. There's two ways to grow organic or through acquiring. If you're going to grow fast acquisitions, I mean, acquisitions make a lot of sense. You got to have a proven model. I've proven my model out organically.

I think I have a lot of advantage on my Google side because I have a marketing company. But I will say this. I look at people, companies out there that are unlike me. So I'll tell you, our service is the best in the industry. I'm a service guy. I can do service. Not only sales. We're going to give you three things. We're going to get it done today when you want us out there with a drug test and a background. We're going to do it right because we train the heck out of our guys and we're going to use way better parts than anybody in the industry. And I know that because I've gone to specific manufacturers for every single part on

the door. We have higher cycle life than anybody. So service is far by none. But door sales, the economy is picking up. People are buying new doors. They're buying nicer doors. Real estate's going up. You know, if you look at it, it's the smile of your home is a garage door. So I'm looking for things that are not like me because I know I could go into this huge garage store sales company. I could triple their service side. I could get rid of some of their operational side because it's redundant. And then I can pull down their costs. So tell me a little bit about what's a good acquisition for different people. Well, for me, that's why I love acquisition so much is because you can be a great organic marketer like Tommy is. And I've worked with a lot of great marketers.

But in the end, it's really just a hope and a wish that somebody will see your marketing and respond and call you. Whereas when you acquire a company, they are people who are trained to call when they need that service. Roofing, plumbing, heating, cooling, electrical, garage doors, you name it. That's what I'm calling for the ringing phone. Now, sometimes I also want some trained staff or people want to, what I call a beachhead. So if I was Tommy and I'm going to Flagstaff, which is two hours apart, you can't easily serve the same market. You have to be there. But I know that if I had that, I already have a base of customers and now I can advertise heavily around that area and just use it as a beachhead and grow more and more and more

where you dominate that. And then you go out and hub and spoke from there. The thing about that, again, is you have to be a good systematic company that has the ability to go and grow. So acquisition, as I said, it also comes down to cash. People go, I don't want to pay that money. And I'm going, well, usually you're paying them with the money that the company throws off because you're not coming to their door with a briefcase full of money at closing. Not anyone that had ever been coached by me.

You go there and typically you pay it out over three to five years. That's a normal thing. And if the company is thrown off business because Tommy can already make, I don't need your office location. I don't need your ARAP people. I have all that in my central location.

So I can make more money with your sales than you could ever make. That's the beauty of acquisition. And that's why it works so well. Having said that, again, it does rely on your systems. But if you're a small company, you can acquire other little companies and just do what I call Pac-Man approaches. Keep swallowing off the little companies. Because if you're a little company, and it doesn't mean you can't make money and a good living. This is not an indication or anything that's disparaging to small companies.

But God forbid you get sick or hurt or die, the company ends. And by the time you're 50, 60, 70, you can't do what you did 20 and 30 and 40 years old. So you're running out of time and not a lot of options. So when someone like Tommy comes by and talks to them, it's a good way for them to exit the business. And it's a good way for Tommy to keep on accumulating and growing this company because he's got the base to handle all of it. And that is even true for any small person on growth out there. If you want to do a growth strategy organic is great acquisition is great and sometimes people don't realize well i never did an acquisition and i go

well tell me how you came to the business oh um you know i worked at the business they had no successor so i ended up buying the business i go well then you did an acquisition it was just acquire a company you knew and so this is people are more familiar with this than they think, but acquiring a company is first, the notion to get rid of is that this idea of showing up with a briefcase full of money is not how it works. Right. And you know, there's so many good deals out there. I mean, listen, seven out of 10 baby boomers are going to retire over the next 10 years. And the biggest question I get is how do I value my business? Well, typically we look at the last three years. We look at a lot of financial statements.

We're going to get some throw-ins there. We're going to look at your assets. There's a lot of things we're going to look at. We're also going to look at do you have a bunch of small customers or do you have some huge customers? Because if you have some huge customers and that contract falls out, we're at it up, you know, shit out of luck. So all this stuff goes into play. Great point, Tommy. Don't miss what he just said here, listeners.

Because if your big revenue comes from one or two people and you lose that relationship, then the company is not worth it. It's better to have a whole bunch of smaller ones that you can keep in the pond. So that's a good, good point. And something I've learned, too, Al, is we used to do a lot of the Home Depots, quite a lot of them. I mean, dozens of them. And we went back and really dove in to the time it took to. Now, here's the deal with Home Depot. You've got the customer.

You've got the manufacturer who manufactures the garage doors. You've got Home Depot. And then you've got our company. So right here, we've got four separate channels that are trying to communicate on one common goal. And let me just tell you, Home Depot is not trained on garage doors. Clopay cannot control. Clopay is at Home Depot. If a door takes too long, it's three weeks

out. Something goes wrong. The shipping gets messed up. The customer's calling us going, where's this? So we're trying to figure this out. And we learned, man, we are saving pennies. We're watching $100 bills fly over our heads. So we got rid of Home Depot. And when we talk about buying companies with big contracts, don't look at it and say, God, they got Home Depot. That's worth a lot of money. You might be buying a nightmare. And that's all I would say is anytime you're dealing with B2C, B2B, I love B2B. B2B is usually less headaches.

But this B2C business to consumer typically in the home service industry is a better route because I'll tell you, even if you buy a big builder, builders pay last, they pay the least and they're the biggest pain in the ass. That's why I only deal with custom builders because they'll pay up front. I hear you. And I, and I, and I agree with you, Tommy. I got rid of when I finally knew what it costs to be in business these many years ago and knew what I needed to charge for the right selling price. It immediately was a very scary moment and an incredibly liberating moment because I knew not everybody, like I said earlier, is my customer.

And I had to get in front of the right customer, which is why my marketing got so much sharper and getting good at my message and being able to deliver the message. This is really where you need to focus on that. But for me, what I coach my clients on is the goal is to work for the end user, the person who cares, so working with the, with the homeowner directly or the building management company directly or the

Starbucks directly and not being in the middleman builders are not bad people. They're good people, but the only way they make money is they get so much for it and they have to hold you down on the price and they want all the levels of service so that's a difficult thing that doesn't mean not a reason to work for it but you got to be super super efficient to be able to manage and you have to get a certain size of heft to be able to do that so be aware there is what i'm speaking to is there are when you're buying you got to know what you're buying i guess is the best way to describe it and that could be as simple as just looking at a couple of invoices and signing a nondisclosure so that if I went to Tommy's company, he'd be willing to share because I'm not stealing his customers.

But I got to know where is the money coming from and what type of work do I really want so I know what I'm buying. Yeah, that's not easy. I mean, it shouldn't be a wham, bam, thank you, ma'am process. And, you know, you want them to have some type of buy-in be a wham, bam, thank you, ma'am process. And, you know, you want them to have some type of buy-in to where they say, okay, I'll pay you out over time. And it's something where you can pick up a phone number for $10,000 and you know it's getting three calls a day all day long. Those are the best.

It is. It is. That's what I call mailbox money. It's great. And these guys have been around for a long time, and they're just like a lot of people are just ready to get out. A lot of people hit this point and it's the point of no return when they go, I'm going to kill myself if I stay doing this. I'm going to move and I just need to dump it. And they need to know that you're available to buy.

My uncle in Kingman, he's an incredible guy, multi-multi-millionaire, really a blue collar guy. Used to have a bunch of pickup parts and feed shops and used car lots. And he goes, Tommy, when you have money and people know you have money, you're not advertising that you're a millionaire and flaunting it because he never does that. But he goes, the deals come to you. So I think part of the key is knowing, get a hold of your manufacturer, your manufacturer reps. Get a hold of the big brands you work with and say, listen, if you know anybody in the industry, I'll buy in Juneau, Alaska if it's right. Because I know the industry and I've got all the checks and balances. I know if a guy starts his car at midnight. I know if a guy's at a job for 10 minutes.

So people ask, how are you able to scale? I can barely keep control of what I got here. I said, it's processes, man. I hate to say it because I do this for the guys. The way I explain it to my technicians is this makes you so much more efficient. I know how long you take to do this type of work. And it's true. I a hundred percent trust my guys, but you've heard of that trust, but verify. I say this all the time. People don't lock their door at night to keep the bad guys out. They do it to keep the good guys out. The thing is, is if you put a gold bar in front of the most honest guy and his wife has a serious problem with her health, even the good guys make mistakes at times and people do what you inspect,

not what you expect. And that's how we're able to scale. So I'm really getting excited about all the acquisitions we're gonna do. And we're really setting ourselves in the right position to do that. And I think I can learn a lot from you, Al, just because you've been living it and breathing it and you probably structured a lot of these deals. Am I right?

Yes, as a matter of fact, I'm headed next week back to do with a client of mine and just on this topic alone, because it's such a big, meaty topic. But a lot of what you're saying about, you know, I made my manufacturers, my wholesalers, my suppliers, my free agents to go out and look for other businesses because they have a vested interest in this. They don't want to deal with weak competition or people who are just going to close the doors. That's lost sales for them. So if they can put them in my hands, a strong company, everybody wins. The person who's selling has an exit strategy. I've got more calls and they, the suppliers, the manufacturers, the rest of it have added more business to them that they can hang on to. So they're happy for it. There's a lot to this, but you do need to do what Tommy's talking about.

It's not someone, you got to work this. And so the funny part is when you do enough acquisition and you get known as the acquirer, people will start calling you. They will start reaching out to you about acquisition, but that's why you have to get going. You got to send out the letters. You got to email.

You got to blast. You got to do a lot of things to get on the radar of people that go in your whatever segment you are that you want to add companies. That is definitely it. Only precaution I have here, because I think acquisition really can't be done wrong. There's just degrees of better. That said, there comes a point like a stock, like Tommy was mentioning before. You can't eventually overpay for a stock, just like you can overpay for a house. You got to be aware of the cycle. And my suggestion is start small and learn your lessons, like we were talking about, Tommy, about mistakes. Learn your lessons on small ones,

figure out what you can do really well, what you add to the stuff, and then keep increasing, you know, doing more as you go along and making the adjustments 100 and you talk your number one rule is planning and it's education and i'll tell you usually people say buying a home and selling a home is going to be your biggest purchase and some of the biggest transactions in your life well the people selling a business this is their biggest thing and they have no clue how to do it. So if you can define what that process looks like from A to Z, here's our plan. We don't veer from it. We don't make exceptions to it.

I mean, there's little details, obviously, in the workings. But the fact is that if they understand it from A to Z and you've got testimonials, you'll become that person. And guess what? If it's done correctly, some of the times it could be zero out of pocket. Because the biggest, best thing you could do is use zero money to acquire a business. And I'm meeting up with my lawyer who charges me $500 an hour, but I call him all the time. And he's a great guy. He's acquired 12 different businesses this year, all lawyer businesses. And he goes, Tommy, these guys want

to come work for me because I build better than them. I get more customers than them. I work with Walmart, Costco, some of the biggest companies. And he goes, I'll teach you how to acquire like nobody's business. And I can't wait to sit down with them because if I could acquire with no money down and then I say, here's what you get from me, you're going to get a percentage of this market. Here's how I'm going to double this market. Here's how I'm going to double this market. Here's how I'm going to get the best out of your technicians. Here's how I'm going to book more phone calls than you do. It's really a no-brainer.

Are you passing off your business as somebody that's going to stick around, that's going to keep you getting a paycheck? And there's tax incentives for not paying the first year for the business. So I'm just, I get excited and I get really passionate about this subject. I want to do a little shift here because you talked a little bit about the right customer and answering your phone. I believe everything's an opportunity. Don't judge a book by its cover, but you do have to prequalify the customer. You need to know that they're the homeowner. You need to know that one of the questions I always ask is the price.

Obviously, we try to book it without discussing price whatsoever. But if it's the final stance, and I say, what is it going to take to earn your business? And they say, I just need to know what I'm looking at. Well, it's hard to know just like it's hard to tell you what's going on with your car until we look at it. So if I get a guy out there, he says all the right things, you're happy with them. Obviously, we do drug tests. We text you his picture, his profile on the way we do background checks. He'll come in a wrap vehicle. He'll have an iPad there to show you what's going on.

If you're happy with what he has to say, are you willing to do the work then and there? Now, if they say yes to that, then it's not on me anymore as the call center rep manager or owner. It's on my technician. So tell me a little bit, obviously not every customer, I'm not trying to say you want to go on Craigslist and pull every Joe Schmo off of there. And I had a wise guy tell me from direct energy, if you're getting more than 70% of all your new door bids, then raise your prices. But tell me your take on that. Yeah, you know, I've heard that same line all the time. If you get too many yeses, you're supposed to raise your price. And I think that's really unfair.

I think you need to make the right amount of money because ultimately charging the right price is not in your best interest. That sounds weird. Let that wash over you. Charging the right amount is really in the customer's best interest because how valuable is the warranty that you provide if you're to do in a draft uniform and all the other kinds of things. And they want somebody to answer their phones day and night, weekends and holidays. They want to make sure somebody can come out and take care of their work today and do it the right and not have to. They have paying jobs, which is why they can afford to buy, you know, get you to come. And the worst thing they want to do is take another

day off because you didn't do the work right. So charging the right prices, first and foremost, as I teach in sales, is always in the customer's best interest. That doesn't mean we get to take advantage of them. That's why I call it charging the right price based on your profit targets and growth and things that you need to do in business. And that comes from a budget. That's really kind of the essence of what you need to start here. But ultimately, having a plan for your business and what you envision it is where you got to get on that path and stay there. And so marketing for me is, again, I'm looking for the screening, which is you did a great job. Basically, our CSRs don't discuss price. There's a script that they follow in the CSR manual, and it builds value. And it's telling the truth, which is, could I possibly know what's involved with your garage door over this phone call?

Do I know if it's the springs? Do I know if it's the motor? Do I know if it's the remote control? No. And all of it is a guess. Years ago, I was selling heating systems. And, of course, what's the worst that can happen is you get a friend, a family member, a house of worship calls you, right? And so a friend calls me up and he goes, I need a new boiler.

I only want to use you. And he goes, I need a price quote. I go, I'll be happy to come there. He goes, it's okay. You can give me a ballpark. And I go, no, got to measure things up, make sure it's the right thing. And he goes, I really won't hold you to it. So I said, listen, it could be anywhere from $5,000 to $10,000. And don't you know, when I got there, Tommy,

it was $7,500. And the next thing my friend said was, I thought you said it was $5,000. That was the only number that he heard when I ballparked it. You cannot win in that scenario, which is why, you know, getting somebody out to the job. If you have more calls than you can humanly do in a day, I recommend a minimum service fee of which you are happy to give it back to them if they do the work today. And that's how I train most companies to do that. If they need extensive diagnostic work, that is a task they have to sell. And this is where training comes in. Techs are not supposed to be trained in the field, the classic on the job training. They're supposed to be trained at your business where you are

role playing all these other things need to be handled and how to do the work because otherwise if you come to the job basically what you're saying is i'm paying you to learn how to do your job and that's one of the things that the techs that I train learn to say is we're not coming to your house today to learn our job. We've already been trained and certified at our own shop. Yeah, I agree to training at the shop and I do like some infield training because what I found, you know, I want to tell you a few things. People love stories. I'm just going to share a quick few. Al, you got a while or you got to get going here? I have usually to the bottom of the hour. Al, you got a while or do you got to get going here? I have easily to the

bottom of the hour, so we've got a little more time to go if you're good. Yeah, I'm good. So what I do is, let me tell you, we're in Milwaukee, okay? And my brother-in-law brother runs Milwaukee and he calls me up three weeks ago and he goes, I don't know how your

guys do it. Obviously, there's way more money in Arizona. And I go, no, that's not the case. And he goes, well, can I send your guys do it. Obviously, there's way more money in Arizona. And I go, no, that's not the case. And he goes, well, can I send my guys out there to get trained by a couple guys? And I said, no, let me call another guy three way. I'll send my guy out to your market. He starts laughing. He goes, well, he'll see and you'll see. So my guy goes out there for a week and sets the biggest record in the company and he goes man i might have to move out to milwaukee i love that area that's incredible and i go mike let me ask you this did you hand pick the jobs for him he goes no i go did you decide where he was gonna go he

goes i let the the guy that i sent out there go to all the same areas that that guy goes to. He goes, Tommy, you don't know how powerful that was. He goes, it was incredible. So I believe 100% you got to train people internally and give them the stuff they need. But sometimes seeing is believing. And another thing that you talked about is I called a friend out this summer. He's a one-man shop. He's a one man shop. He's a really good friend with my neighbor. I love the guy. We get together all the time. And, uh, and I hope, you know, I hope he doesn't listen to this, but, uh, but anyway, I think he'll

learn a lesson on it, but I'm not even going to go too much into detail, but my, my air conditioner broke and obviously I just wanted him to come out and fix it. And he knows to take care of me. So he charged me $150, whatever it was. And I just said, okay, give me a good deal. He came out and fixed it. And two weeks later, it's 95 degrees. I said, George, something happened.

Come back out. And the third time I told him, I said, don't do me any favors. Fix everything that needs to be fixed. I don't care what it costs. And a lot of times our guys go, one of the biggest excuses I hear is I just don't feel comfortable selling that many things and doing that. And I go, you think you're doing the customer a favor by going out there three times, by making them miss work, by making it hot in the house and spoiling their food and everything else. I go, you need to look in the mirror. I go, listen, the first time you might've met your wife, is it the first time you met her that she decided

she's going to marry you? You need to look at it and be comfortable with a no. You need to be able to explain the value and you need to be confident because if you walk up with your tail between your legs and you say, well, I don't feel comfortable doing doing this i think it's a joke smell it yeah they smell it and that's why i sell is one of the things i love so much because i was so bad at it early in my life and i learned that being me being me was really what i needed to do i was imitating my dad and that was no good he was quiet you can tell this call, I'm not a quiet guy and I have to be me, but I mean, when I'm passionate, people just stop me in the middle of talking and go, okay, how soon can we get started? And I was so stupid in sales at the beginning, Tommy,

I go, we'll get to that. And I would go off with my presentation. You know, there's a process you have to learn. And what I want to share back, just go back a little bit, is I'm not saying not to train in the field, but in the field is verification. And that's where, you know, ride-alongs and mystery shoppers are critical. I'm not saying to learn how to fix a garage door in the field. That's kind of what I'm saying is a different thing. So, yes, I'm a very big believer in that because you're welcome to sit in the shop and believe what you want to believe. But the great George Brazil said, don't expect what you're unwilling to expect. And that is absolutely true. So you have to get out and verify what is and isn't.

And you have to get under the hood of it to fix what is or isn't. That said, the majority of the training is supposed to be done at the shop. And all you're trying to do is catch them doing good in the field and then make whatever minor corrections when there's an issue. So we get them back on track and so that they can win. The goal is for everybody to win customer first company second so that the staff long term can win. That's really order in the process. Yeah. And, you know, a lot of people take for granted that staff and they get this animosity and you become such a jerk to your employees. And a lot of the people we talk to on this podcast, they talk about leadership.

And it starts, it does start with the customer. But geez, you know, one day I met with this guy a couple months ago and he goes, how much do you give to charity? They were testing us for one of the top 10 companies in Arizona or something of that nature. And I said, I don't give a ton of charity because we give so much back. We fix the vehicles of people. We change their tires out because they're tight. You know, there's CSRs that are making 15 bucks an hour with a family. We got insurance. We we try to give out gift cards and have drawings and do dinners paid for on us. And I go, we're employing 170 people. I got to look internally before I go out and give out. You know, if you want to know how much I give to the charity of

my business, it's a hundred of thousands a year. But I think that's one of the mistakes. A lot of people that are conceited might say, I'm just doing this because I want to get on the news. And some of the time you don't realize how far it goes to give back a little bit to the people that work for you. And just say, and listen, it's not about money. On Mother's Day, buying the gals with kids flowers. Valentine's Day, acknowledging people, telling people how good they did.

It goes a long way. It's not always about money. And I know a lot of people listening to this, business owners say, it's really good and dandy if you're doing tens of millions of dollars a year that's not the case a simple pat on the back means a lot yes in a small company especially so because you see people every day you just assume they know well i and i grew up in an era you know tommy where in our new york city union shop if you didn't mess up, we didn't talk to you. So that was a good thing.

And if we did, we were writing you hard, which is those days of sale. People today, and it's been true for a long time, is, you know, find us doing something well and make a big deal about it. Well, we will do something bad to get your attention, as stupid as that sounds. So, yeah, you think you have no. And we used to stutter when we first learned how to do this. So it would be like, Tommy, you're doing a good job.

It was so not like us. Because, again, if you were doing good, we left you alone. That doesn't work. People want to hear that you're doing a good job. I remember, and I know we're getting running on time here, but one of the great stories was I wanted to do a reward program for Above and Beyond, and my dad and my brothers said, well, we pay them. Isn't that enough? And I go, no, it's not. So we had to do a bonus program. And I asked, I had 25 contractors back in the

90s. I said, how much money do I have? And they said, $2,500. I said, well, I can work on $2,500 a month. They go, no, no, $2,500 a year. He said, 25 pecs, $2,500. Are you serious? And they go, yeah, we are. So I knew I was in a stuck situation and I pulled the field supervisor, my top guys for them. And I go, all I got is $2,500. And here's what I got is a book that says a thousand and one ways to reward an employee. I said, and by the way, I need something objective. So the four of you huddle up and come back to me. So I thought for sure, Tommy, they were going to ask for more money or more time off.

They opened the door. They pulled me in. They go, here's what we thought. We're going to have customers write letters. Listen to me, not an email, not go and like you online. Sit down and write a hand letter, which will be objective so you can use it in your sales and marketing. I love it. So what else did you come up with for rewards to go? Well, if we

get the rewards, you have that objective thing. We want better tools so we can do the high end work. And we also want to go away to those special trade classes. Are you listening there? Did you hear what I said? So when you think you know what you know, you don't until you involve your staff. I would have never guessed. So they're asking for better tools to do their job. And they're asking to go to the high level classes. That's the reward they want for going above and beyond. I got so many letters.

I had it on a bulletin board. I had to keep rotating the letters because I was getting flooded constantly with customers writing compliments about the guys and what work they were doing out there. The staff, all things being equal, they want to do a great job. The problem is you've never told them what is a great job. What is a good job? How good is good enough? And if you don't document what it is in an objective way, we're coming back to that same nightmare. I'm left to read your mind. And here's what I'm going to tell all of you out there. There are no clones coming. There are no mind readers coming. You have to download what's

in your head and make it systematized. That's what you should take away from this today. Here's the thing. I got a couple of quick things. So number one, I want to share a quick story. I pivot a lot just because forget the plan. I got questions I was going to ask you. But when I get somebody like you that just we just jam and it just leads to the next thing. It's like when I'm telling a joke, someone tells another joke and it reminds me of five jokes. But the deal is, well, real quick, I have a guy that just came back to my company and he said, you know, I left for three years, Tommy. And he goes, it was the biggest mistake of my life and the best choice I ever did.

And I said, what do you mean? How so? He goes, man. He goes, I would have never known how great it is to work for someone like you. And I said, well, how so? He goes, you give us everything. You're not on our butts you dispatch smarter you give us more work than we could handle he goes you give insurance now you pay for gas we get a wrapped truck he goes i gotta tell you if i didn't see the opposite side of it he goes the grass is always greener and i'm so glad i'm back yeah and uh yeah you know i love that tommy I love that story.

Well, it's kind of a testament because all the guys here, he's telling them he's at the meetings, telling people he's going out. I was where you were kinder than me. Years ago, I had trained this one installer. He was flipping pizzas and I got him to be one of my best. But he was always a bit of a problem child. And one day he just leaves. And so I'm saying, okay, well, good riddance, because I'm at this point where I can make my own people. And he comes back literally, Tommy, the next day wanting his job back. And I said, okay, but you're not getting the same union seniority. And you know the work that you said you wouldn't do? You're going to do it.

And besides that, we're going to have a meeting on Wednesday, and you're going to tell everybody else how the grass isn't greener out there because they're like you, thinking that things are better. And that's exactly what I did with this guy when he came on back. So you're a much kinder person. But I had a message to deliver. I had a message to deliver, and he was ready because until he was out there, he didn't realize all of the things he thought.

And maybe that was on me because I didn't do enough of a good job at that time explaining to them all of the things I do and why. So really, you know, it's easy to point the finger, but like Confucius said, so we're still facing you. And when I began to own more of what I was doing wrong, magically, they got better. Go figure that one out. Well, absolutely. I mean, the first person we got to wake up and look at is ourselves. And so many times we divert that. And I just, I've learned to take more personal responsibility over the way things go. You know, when I talk to a customer and things mess up, I don't go, yeah, this manager's new. He just, he just, he's an asshole. He didn't know what he was doing.

I go, I go, listen, this is me. This is me. I'm, you cannot imagine. I mean, you can, Al, because you lived it. But the people out there that are listening, personal acknowledgement and responsibility. When I talk to a customer and I mean, it's a shit show. First thing I say is, listen, tell me exactly what happened. And then I say, oh my gosh, I say, I cannot believe that.

Let me just tell you, this is my company. Here's how I started. I absolutely am going to make this. I am on this. I'm the owner of the business. I'm embarrassed. And the story I always use is if you go to Wal-Mart and somebody makes a mistake in line, maybe one of the gals checking you out. Do you hate going to Wal-Mart or you realize that it's you're not going to hate Wal-Mart? And some people learn to hate the company and you just got to say, it's my fault, ultimately, personal responsibility. And I'm going to make sure this doesn't happen again. And the interesting thing, Al, about this whole story about Tyler coming back is he goes, you know, Tommy, my first day back, he goes, I think I was number one today. I go, you were. I'm like, it's great to have you back. And I'm like, I'm just really excited. Just don't forget,

you're still in your honeymoon for the next three months but i said tell me uh tell me what happened today he goes well interestingly enough i went to a warranty call and i was able to get a rather high ticket out of it because the guy only charged a service call so i sat the other guy down and i said how is it possible that that this new guy that we got back went out and got an amazing ticket and he goes well tommy that was just a little safety eye issue. And I said, Tyler, tell me what you did. He goes, well, yeah, that's all it was when I went back there. But I ran the guy through.

I asked him all the three questions you train on. I talked to him about his Harley Davidson. I talked to him about his service that he did in the military. I talked to him about this, how long he's going to stay in the home, how long he's been there. And then I went through the complete 30-point inspection, and I pointed out, I said, we're consultants and we're detectives. And we're detectives because we do balance checks. We check for things that could happen.

I love it. I love it. I love it. Because what I tell Tommy is we are the total solution provider. Now, you may have been on the internet at Google for five minutes and think you know everything about garage doors, but who's the expert, Tyler or the person at home? It's your job to give them peace of mind, safety,

and all the things that are related to this garage door. If they say no, it's okay. But you not telling them, not asking the right questions, and really listening is the issue. And I love that Tyler understood that. Oh, it was music to my ears. And we do a morning meeting at 7 a.m. every Thursday where we have everybody on Skype. And I was a little bit annoyed because I said, guys, listen, I'll give you less jobs.

Let's optimize every opportunity. I had a guy come in from Michigan and he said, Tommy, I don't want any more than three or four jobs. I said, why? I said, on a good day, a guy can knock out seven. But that's I know what he was saying. So I was just for the story. You don't want to be pushing. You don't want to you don't want to push the button and run. You want to be there with the customer and serve them right. Well, he said, Tommy, I used to run seven jobs. I make more run in four. I go, how so? so he goes time is something

we can't get back and time number one you want to go home and eat dinner with your family so you're not going to sell that on a garage door there's what's called a spring pad if it's cracked you could just move over the uh the center bearing and the thing is guys do it all the time because they don't want to take the time but if they don't want to change out a bottom retainer with the bottom rubber because it takes too long, yet there's scorpions coming in all day long. And what I realized is if I give a guy three to four jobs, he'll bring in more revenue, more profit than seven or eight jobs. And it's really interesting in the home service industry. Once people understand that, it just it changes the dynamic of sales. And you, you really hit upon

a good thing that I want to go back on is it's a different era now. And it's an era where customers have more power than they've ever had. And the fact of the matter is, is we talked about organic growth versus being able to grow, grow by buying out companies and or acquisition. And this is a better time than ever, because I can take market share so quick because there's one thing I know is a fact. 70% of all services are found online and more than 70% are found on Google. That means that if I control Google, I can explode into a market. I could own that market before I even get there if I'm good so organic growth in my opinion it's the best time because i don't need to be the triple truck in the yellow pages i don't need to have

a huge customer list so i do agree with or uh acquisition but i do say that if companies out there understand the power of google because listen most guys that are 50 60 years old they say i don't even have a website. I don't believe in that shit. I don't get it. And you bury them because what's happening now is the baby boomers. Yes, there's still going to be buyers for the next 10, 15, 20 years. But now there's the 30 year olds buying and none of them are going to the yellow pages

or going to go to the sticker. Can I share a little quick thing? Yeah, I want you to. I love this. Yeah. But the thing is, there's a myth out there. And I spell this myth with everybody I work with. My wife and I are well off of 50.

And we don't look in the yellow pages because we can't read print. We go online and Google search. We search from our phone. So I asked my wife, ask all your friends. And I asked my friend, none of us, this thing over 50, you think we're digging out the yellow pages you're wrong we're doing google search whereas recommend we do exactly what quote-unquote you think the 30s do when we search companies now we look at the website we may do a little more research we may ask for friend recommendations but that's why you know that there's rare exceptions now that doesn't mean that there is not a market where yellow pages work

have a contractor that in a small market in the midwest where he still does well off the yellow there's rare exceptions. Now, that doesn't mean that there is not a market where Yellow Pages work. I have a contractor in a small market in the Midwest where he still does well off the Yellow Pages, but it is not the way to put your money out there. And so I agree with you, Tommy, which is if you, but this is something I don't expect a 50, 60-year-old to practice and really learn this now, or even 30 and 40. There is a science to this,

and it's a science that's moving. So you have to invest in yourself and your company and find the people that really can make it happen, not people who just tell you they can make it happen in the pay-per-click, SEO space, and organic searching, and all the other stuff. Because it is a science unto itself. Like you were sharing about,

there's a whole different level of CRM database. Saying that I have a CRM database is like saying I have a car. It's a whole spectrum of what a car is, right? Absolutely. I swear this could go on for hours and I know you got to get going. So some of the things I'd like to close with, I mean, literally, I wanted to talk a lot more about delegation. I wanted to talk more about training. We had more about taking action. I just, like I said, I want to take you out to eat.

Hopefully, when you edit out and you like what you are, we'll do more. But for steps delegation, I really believe this is you listeners out there, put your arms out as far as you can and grab your fingers. If you're the only guy who can do stuff, that's as much as you'll ever accomplish in life. And so we don't delegate because we've delegated the stuff. They did it wrong. And we say, well, that's just a waste of time and money. The reason is you dumped

it. You didn't delegate it. There's a process. And I shared with Tommy before the show the process that I teach. And so that Tommy will get this out to you. There's a method like everything we do. Steps to delegation is a learned process of how to delegate the right way, which means taking the time on the front end so you get the results you desire on the back end. And I'm happy to share more in a follow up call or whatever else that we need to do. But I hope that does tie into what you wanted, Tommy. Yeah, so I'm going to put all the resources.

I'm going to get with Al. We're going to give you guys as much as we could give. The Home Service Expert. So it's homeserviceexpert.com forward slash seven powers. We're going to create a page. We're going to give you as many resources we could give about Al. We're going to show you how to contact him. Obviously, he's got this stuff down to a science. He's worked with a lot of people.

I think for a guy like Al, he'll work with you if he could make a big impact. I look at your company and say, you know, you correct me if I'm wrong, Al, but this is a good time to get me in there. Maybe I'd recommend you do this, this, and this, and then you get me on. Is that something that you would say is correct? I usually do like free 30 minutes to help the industry. It's a give back that I do. And, you know, it's just a case of if they reach out to me, I'll set up a 30-minute call. Because, you know, if not for mentors that came into my life, Tommy, I'd be in a basement late in my life turning wrenches at 2 a.m.

Not a good thing. So I'm happy to talk to people about that and see what's appropriate because there's just me at this stage of my life. And so I'm going to have more people come into Phoenix to sit with me and learn how to do some of these things they need to do in their business. And I'll be doing more stuff online,

but that's really my goal as I'm working through my career at this point. And if you want to know more about me, when you get to my website, don't listen to me. go to the success gallery tab and hear what contractors have to say about the work. Cause that's the only thing that's important. Yeah, obviously the hardest part about taking action is taking action. And so many people, and we talk about this a lot, they sit here, they'll listen to the podcast, they'll listen to us. They'll say, wow, that's cool. That's awesome. I learned a lot.

And then they'll go home or they might go to work and say, hey, we're going to do this today. And those are the guys that are always switching. And the staff does not respect them. The staff says, OK, this is the this is the thrill of the week for Mark. You know, yes, yes. The flavor of the month. The flavor of the month. He read a book. What book did you read this week, you know? And the difference is you start working with a guy like Al, and trust me, I'm not getting anything from Al, you know,

except for friendship. If you start working with a guy like Al that's done it, that knows the ropes, that knows what he's doing, he'll take you through and he'll keep you on pace because a lot of us, we get busy with life. And, you know, Al talked about that. You you know when you're thinking about a you know staying on balance there is no such thing as balance there's a great book I just read it's called Off Balance on Purpose by Dan Thurman but the point is get a guy like Al help you take it and actually the biggest part of this is implementation and And so many people have a plan.

You might make a beautiful, all the jobs you're going to hire for and have this great training guide, but you don't implement it. So sometimes it takes someone that I hate to say this, but they're better than you at it because he's done it so many times. And I go to people like Al all the time, and I can't wait to sit down and take Elle out to lunch. And, you know, Elle, what I like to do is I like to close out with some final thoughts and just maybe a book or two other than the E-Myth that you would highly recommend. And we'll make sure that, like I said, I'll get with you for lunch. I want to get you back on here. I think there's so much more we could talk about. But for now, let's just close it out and say, you know, with some closing thoughts and maybe a couple of books that, uh, one of the best books that I've read of late, uh, is starting

with why, which is Simon Sinek by any day. Um, because you know, it's easy to drift and I was drifting. I've been at it for 15 years in the second career. And, um, you know, it's easy to drift. And I was drifting. I've been at it for 15 years in this second career. And, you know, you got to know what gets you out of bed. And you can tell I'm still pretty passionate about everything that I do. And business is something that I love. It's not just something I just do. And so starting with why is really a great way, especially for any company that's been in business for a while. But for any company, you know, why are you going to do what it is? So I strongly recommend that. And the only thing I would say other than that is there are not a million things you need

to do. It feels like there are a million things you need to do in business, but there really are the seven that I spoke about. Now, those seven will keep you busy from the time you ever, till the last day at work, you'll be working on refining and getting better and better at those things. But knowing that there are seven things that you need to work on and keep your focus, you and the team, really does help. I love that. And, you know, to get to those seven things, Al, I'll tell you my biggest problem. And this is why I have the most amazing assistant. Her name is Brianna.

I have time management issues. Obviously, we ran way over today. And then I have time management issues. Obviously, we ran way over today. And then I have organizational issues. And it's just because this is who I am. Entrepreneurs. My CPA is one of the top CPAs on the West Coast. He's only got 10 clients. And he says, Tommy, if I walked in andanna doing it, he goes, because you are you're thinking about so many things and I'm organizing my own way, but she helps ground me. And that's why I'm able to sit here and focus. And right now I'm not answering my phone. I'm not doing anything else. I got my door locked. It says genius at work, but that's really not the case.

But anyway, I got to tell you, this has been one of the most fun podcasts I've done. I'm really excited that you're local. I mean, you're a hop, skip, and a jump away. And I'll follow up with you. And I'm really excited about everything. I'm excited to implement some of this stuff. And I definitely want more from you. So thank you so much.

I hope you have a great day and a great weekend. And just expect to hear from me soon. Okay. I'll look for your email. Thanks. Thanks, everybody. Hey, guys, I just wanted to say thank you for listening to the podcast. And I wanted to talk real quick about the new book I have coming out in November.

It's called The Home Service Millionaire. And I discuss everything it takes to hire the right people, train your salespeople, how to get tax breaks. It talks about how to sell your company for the most amount of money. We've got a lot of great contributorships coming on. Everybody from Paul Akers about how to go lean to how you do sales from enterprise,

how to get the best write-offs in the industry and save a ton on taxes and actually make your company look more professional. I got the CEO of Service Titan. I got the CEO of ValPak. We've got great people on here that know everything there is to know about marketing and Google. And there's basically no secrets we left out of this book. Literally there's people that have read it so far say, I cannot believe you're giving all this information away. And the reason I did that is I

just feel like you guys could just take each one of these gold nuggets and run with them. I mean, the ultimate goal of the book is to make sure that everybody is successful and makes money. If I could contribute to your lives, then that would be amazing. And I feel like it's the least I could do. And I really appreciate you listening to the podcast. I hope you enjoy the book. Go to Home Service Millionaire. That's homeservicemillionaire.com and pre-order your book today.

Thank you.