00:00
you’re listening to the simple growth
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podcast
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the show that helps business owners get
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their life back
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here’s your host mike callahan
00:09
welcome back to the essay weekly talk
00:11
show mike kelly here with my co-host
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cody owen from service autopilot what’s
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up cody how has the week treaty is the
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last seven days since we’ve been on uh
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facebook live and the podcast man i have
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been
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good just uh just working on some new
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collaborations for the lawn care
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millionaire youtube channel
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um i i got to sit down for like
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two hours with naylor from lawn care
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rookie
00:37
awesome recorded a bunch of stuff so
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keep an eye out for that
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on the lcm channel love it absolutely so
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we’re gonna mix it up a little bit today
00:45
cody uh what we’re gonna do is actually
00:47
be talking about
00:48
um creating production and profitability
00:51
in your service business so whether it’s
00:52
lawn care
00:53
home cleaning pest control uh pretty
00:56
much any service business has production
00:58
behind it we’re gonna go over the next
00:59
half hour
01:00
maybe 40 minutes of how to break down a
01:02
foundational system
01:03
in your business for success and not
01:06
only how to
01:07
set it up but then how to actually get
01:08
your employee buy-in for production and
01:10
quality constraints and then
01:12
finally probably the most important part
01:14
of the piece at least in my service
01:15
business was
01:16
well now that i’ve got all this kind of
01:17
dialed in how do i track it daily and
01:19
weekly to make sure that we’re actually
01:21
hitting our numbers
01:22
with profitability how can i have
01:24
transparency to my employees
01:26
to actually get some buy-in and then um
01:29
probably the biggest issue that i see in
01:31
most service businesses i’ll be honest
01:32
including my own in the early days
01:34
is uh when folks get on facebook and
01:36
they go you know
01:37
i’m gonna raise my prices this year or
01:39
mid-season i’m raising my prices by
01:40
three or five percent
01:42
across the board or uh maybe it’s a home
01:45
cleaning
01:45
uh business where i’m gonna raise my
01:47
prices twenty dollars a cleaning for
01:48
weekly or bi-weekly
01:50
and thirty dollars per trip for the
01:52
every four week or month we clean
01:54
or very similar to lawn care company you
01:55
know i’m gonna raise my prices three to
01:57
five dollars a cut across the board
01:59
and really what we do is we end up
02:01
alienating our most profitable clients
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um and literally just bringing our least
02:06
profitable clients up to where they
02:07
probably should be at market value so
02:09
i’m gonna go in
02:10
and uh kind of lift the hood and show
02:12
you how to raise your prices with no
02:13
emotion
02:14
based on um the actual job that you’re
02:17
doing
02:18
and have no emotion in it so it’s gonna
02:20
be a completely numbers-based um
02:23
solution to raise your prices at least
02:25
once if not twice a year and
02:26
kind of go through some best practices
02:28
that i recommend uh by the end of the
02:30
year in mid-season and really
02:31
being uh the 17th of july july this is
02:34
about when most service business
02:35
especially lawn care businesses
02:37
probably should be taking a look at this
02:38
so i thought this timing was really
02:40
appropriate cody
02:41
yeah definitely so what i’m gonna do is
02:43
i’ll pull up the screen here and
02:45
um dive right into it
02:48
here we go all right and uh if you have
02:50
any questions along the way cody feel
02:52
free to
02:52
hop in and interject and we’ll uh if
02:54
anybody has any questions in the live
02:56
stream here or in the recorded version
02:57
we’ll keep an eye on this for the next
02:58
uh
02:59
24 to 48 hours so a little background on
03:02
myself if no one
03:03
has really heard a background of myself
03:06
and callahan’s lawn care from the essay
03:08
weekly talk show just a little
03:09
background on it
03:11
actually 24 to 25 years lawn care
03:13
business upstate new york
03:15
lawn care landscape maintenance no
03:17
design build and snow removal
03:20
in addition in the last two to probably
03:22
three years uh we’ve had the pleasure to
03:24
be working with some of the top
03:25
uh experts in the national scene in the
03:28
cleaning industry so we know that market
03:30
and we know that industry really well
03:32
uh just to mention a few people would be
03:34
martha woodward another
03:36
certified advisor of service autopilot
03:38
as well as debbie sardone
03:40
one of the top consultants in the whole
03:42
entire north america for the cleaning
03:43
industry so
03:44
what we’re going to be diving through
03:45
here isn’t just going to be lawn care if
03:47
you see the stats on the screen
03:48
it’s going to be lawn care home cleaning
03:50
cost control and
03:52
pretty much any other service based
03:53
business that has production quality so
03:56
if you’re watching this and you see lawn
03:57
care don’t be scared by it this is going
03:58
to be applicable to any service business
04:01
background story is literally with that
04:03
blonde care business
04:04
um started a business that kind of
04:06
revolves around myself as
04:08
the single point of failure so we all
04:10
started business out majority of us
04:12
don’t realize that we shouldn’t build a
04:14
business that’s created around us
04:16
as the only single point of failure so
04:17
that business that i had started
04:19
uh literally through high school five
04:20
years of college and then thereafter
04:22
um literally ended up causing uh a
04:24
divorce in my in my relationship with
04:26
high school sweetheart because i was
04:27
working over 100 hours a week so
04:29
kind after hitting rock bottom at that
04:31
point i needed to find a solution to
04:34
kind of take my life back from my
04:35
business or
04:37
just get rid of the business um so
04:39
obviously i opted for the first option
04:41
let’s figure out how we can
04:42
fix this and create a service business
04:44
that still can provide a personal
04:45
lifestyle for friends and family to be
04:46
in the mix so
04:48
after investing well over a hundred
04:49
fifty thousand dollars in automation
04:51
systems
04:52
uh we went from 100 hours a week to
04:54
three to five hours a week working in
04:56
the business to literally an absentee
04:57
owner 30 days to pop
04:58
so um just a little background on that
05:01
and
05:01
just uh some of the the good things we
05:03
we got lucky enough right in the
05:05
business to get right and some things
05:06
honestly
05:06
we we didn’t get them right we had to
05:08
figure out how to set those up so as we
05:10
dive
05:10
through uh the next 20 to 30 minutes
05:13
basing
05:13
on productions and tracking uh we’re
05:17
going to share those wins and losses for
05:18
you
05:19
particularly what we did in my company
05:22
so this is diving into the
05:26
all the pain that you spent years
05:28
figuring out
05:29
we’re gonna we’re gonna give away in the
05:30
next 20 to 30 minutes
05:32
we are giving it away cody and this
05:34
hairline would not be receded as much if
05:35
i had some of this stuff
05:37
in the holster before i actually started
05:38
it but kind of kicking it
05:40
i’ll protect my hairline exactly exactly
05:42
so one of the things i want to look at
05:44
cody is
05:44
if you were to guess what is the average
05:46
net profit margin in your industry
05:48
so let’s say you’re a business owner in
05:50
lawn care what would be your guess
05:53
of your average um net profit if you’re
05:56
watching here live in the stream if
05:58
you’re
05:58
in lawn care or home cleaning um or any
06:01
other service industry type right into
06:03
the comments
06:03
what would you say the average so put
06:05
the name of your industry in the average
06:07
net profit margin so the profit that’s
06:09
left after you pay yourself
06:11
um a paycheck that is equivalent to what
06:14
you’d have to pay someone to replace you
06:15
in the business
06:16
and all the expenses so a lot of times
06:19
most business owners are not paying
06:20
themselves enough
06:21
or they’re paying themselves way too
06:23
much but what you want to do is what
06:24
would be that net profit margin
06:26
if you went out at market value and had
06:28
to replace yourself um
06:29
and cody if if you don’t mind what would
06:31
be your guess in the lawn care industry
06:32
as far as a bottom line net profit
06:35
three or four percent okay three or four
06:36
percent and what would you say for home
06:38
cleaning
06:40
um probably less
06:44
probably two three percent two three
06:45
percent okay
06:47
um and based on those numbers you know
06:50
you would probably think you’re about
06:51
average if you’re running either one of
06:52
those industries so
06:53
did some research pretty interesting
06:55
stats here for sure
06:56
industry average net profit margins for
06:58
a lawn care company is five percent
07:00
and a cleaning company is actually 19
07:04
um and those are literally averaged in
07:05
the middle of the high and low of
07:07
averages so either way though that five
07:09
to 19 percent those are really tight
07:11
margins
07:12
so what we really need to do in our
07:14
service business is we need to find
07:15
an accurate estimating reporting system
07:18
to create that financial success because
07:20
a lot of the
07:21
lawn care businesses even on that five
07:23
percent six percent net margin
07:25
um as they come to us as a certified
07:27
advisor service autopilot we start
07:29
looking at these numbers
07:30
cody believe it or not they’re really at
07:32
that 15 to 20 percent
07:34
net margin but some of the things that
07:36
we’re going to be going through
07:37
such as uh non-billable drive time
07:40
mobilization and a whole bun
07:41
a bunch of other things we want to look
07:42
at is what really erodes that bottom
07:45
line profit margin so a lot of the
07:46
companies that
07:48
are using a product like service
07:49
autopilot for their service business
07:51
uh are able to go in and see some of
07:53
these stats we’re going to show you how
07:54
to break that down but it’s really
07:55
interesting that
07:56
a lot of the businesses actually
07:58
foundationally um
08:00
on the job itself are doing all right
08:02
but when we look at all these other
08:03
things that’s what erodes that bottom
08:04
line profit
08:06
we’re seeing upwards of 28 to 33 percent
08:09
um
08:09
in these cleaning businesses as well and
08:11
then after they start to add in the
08:13
factors that it wrote it
08:14
um that’s where they end up at that
08:16
average of 19 so
08:17
we’re going to kind of lift the hood and
08:19
explore those areas cody if that’s all
08:21
right with you
08:22
so first we want to look at is one of
08:25
the key factors to be above average in
08:26
your industry so there’s quite a few of
08:28
them actually
08:29
so the key factors to better profits is
08:31
creating estimates that ensure
08:34
profits and not only that they um ensure
08:37
profits but they
08:38
are foundationally based so they can be
08:41
uh delegated to other people on your
08:43
team and you are not the only one
08:44
running around doing 25 or 30 estimates
08:46
in the spring season
08:48
uh we have jobs with budgeted times that
08:50
can be tracked for accountability
08:52
so in transparency in a mobile app
08:55
um or on a printed piece of paper we
08:57
have a budgeted time with clear
08:59
transparency for the team
09:01
letting them know hey you have an hour
09:03
and a half to get this job done
09:04
if it’s a lawn mowing job that’s the mo
09:06
blow and edge that job
09:08
and hey by the way that actually
09:09
includes mobilization the drive time
09:11
from the last
09:12
job we want jobs that track costing and
09:15
overhead so we’re going to show you how
09:17
when we go in and set up the foundations
09:19
of an estimate
09:20
that we want to know the not only the
09:22
budget of time but what does the cost
09:24
break even before we make that net
09:26
profit so
09:27
not only are we going in and get a
09:30
report on the weeklies
09:31
and and the daily wins and losses but we
09:33
go to create the estimates for these
09:35
jobs we can literally see on the screen
09:37
what that projected net profit is so
09:39
right from the beginning we’re setting
09:41
those foundations for success
09:43
not waiting six to twelve months and say
09:44
well i hope it all works out in the end
09:46
which it never does usually
09:48
we want to create a process that ensures
09:50
that budgets are
09:51
being reviewed daily so we’re going to
09:52
go through the next few slides to
09:54
actually show you the process i used in
09:56
my business to create
09:57
um actual verse budgeted accountability
10:01
and then public accountability how do we
10:03
reward our team based on production
10:06
and quality so that was one of the
10:07
biggest mistakes that i’m going to show
10:08
you
10:09
uh that we made is we focused purely on
10:11
production in the beginning
10:13
and we thought the quality would come
10:14
along but really when we implement this
10:16
it needs to be a production
10:18
based estimating system with quality
10:20
assurance and we’re going to show you
10:21
how
10:22
we actually built that out and reported
10:24
it inside service autopilot
10:26
and then we want to have a system that
10:27
tracks and reports this automatically so
10:30
i’m going to show you how we originally
10:32
started to do this in the early days
10:34
in an excel sheet or a google sheet uh
10:36
which
10:37
honestly there are some pros and cons
10:38
i’m going to break those down for you
10:40
because
10:40
a lot of times you really want to be
10:42
able to physically see the pain
10:44
of a crew losing money that day or a
10:46
week uh losing money
10:48
and there’s a as a video running around
10:50
on the internet um
10:51
probably about two three years old that
10:53
uh when the gentleman running callahan’s
10:55
lawn care blew out as achilles attendant
10:57
i had to jump back in the driver’s seat
10:58
day to day and run that business
11:00
and when i was physically typing in
11:02
those numbers to that kpi report
11:05
um it was a red flag like you could see
11:07
the business hemorrhaging
11:08
profits like it was just losing money so
11:11
after the second or third day i was like
11:13
well maybe this is an anomaly
11:14
but by the end of the week um i
11:16
literally went out and
11:17
it started to rain i was out with the
11:19
crew for the whole day i looked like a
11:20
wet dog
11:21
but it was unbelievable the fact that
11:23
this team the only reason they weren’t
11:25
hitting their budgeted time
11:26
is they weren’t following the process
11:28
and system that was set up to actually
11:30
do the job
11:31
so you may have your your uh prices
11:34
right you may have your reporting right
11:35
you may have everything in your business
11:37
right but if those crews aren’t
11:38
following a process
11:40
or system or standard operating
11:41
procedure that’s predictable that those
11:43
estimates were based on
11:45
then that could be another issue so
11:46
having these daily and weekly reports
11:48
are going to be a really good key
11:50
indicator that somebody whether it’s the
11:52
business owner or manager
11:53
needs to get back on that crew and help
11:55
that team get back to that standard
11:56
procedure because you may have estimated
11:58
right they just may be going off on
11:59
their own and doing a different process
12:01
a system
12:02
that that estimates not based on and
12:04
then the final part of this is
12:06
at least twice a year i recommend the
12:07
middle of july
12:09
and the end of november beginning of
12:10
december in a lawn care company
12:11
demanding depending where you’re at in
12:13
the country
12:13
is we want to set a process for raising
12:15
prices with no emotion and i mentioned
12:17
earlier
12:18
what we find in most facebook groups to
12:20
most service industry folks
12:22
are just going out as a percentage um
12:25
raising it
12:26
or an x a certain dollar amount we raise
12:28
everybody across the boards and i’m
12:29
going to show you how
12:30
we can stop doing that because really
12:32
what we’re doing is we’re taking
12:33
accounts that are making a lot of money
12:35
and we’re literally going out
12:37
and opting them out to go and shop your
12:39
prices
12:40
um so that was a big mistake in our
12:43
business and once we figured that out it
12:44
had huge bottom line profit implications
12:46
so
12:48
three ways of estimating um so as we
12:51
started like i said
12:52
definitely not on a pedestal here
12:53
preaching cody um when i first started
12:55
out in the lawn care business
12:56
i went up to a house looked at it and
12:58
said well look looking at this house
13:00
uh everybody in my market i feel is
13:02
charging forty five dollars to mobile
13:03
and edge’s lawn so that’s that’s what
13:05
i’m going to charge
13:06
um nothing wrong with that but obviously
13:08
once we get
13:09
educated in business that’s not what we
13:11
want to be doing
13:12
so what i’m going to recommend is the
13:14
second and third step of ways of
13:16
estimating so the second one
13:18
is based on your experience how long you
13:20
will think it will take so i’d walk up
13:22
to that same house
13:23
and say listen based on my experience to
13:25
mow blow and edge that lawn
13:27
i think it’s gonna take approximately an
13:29
hour and if my goal is fifty dollars an
13:32
hour i’m gonna multiply my one hour
13:33
times at 50 and the price to mow that
13:35
lawn is 50 bucks
13:36
same exact thing if we’re in the home
13:38
cleaning issue maybe we’re going into a
13:39
home for the initial clean whether you
13:41
call it a deep cleaner or top to bottom
13:42
deluxe
13:43
you go in and you say okay based on my
13:45
experience i think it’s going to take
13:47
one
13:47
cleaner five hours to do this top bottom
13:49
deluxe
13:50
times the 50 bucks an hour you got a 250
13:53
top to bottom deluxe
13:54
now we’re going to dive in and give you
13:56
the details of how to actually evolve
13:58
from that process now
14:00
um and then we’re gonna go we’re gonna
14:02
base it on a production rate based
14:03
estimating system so these can be based
14:05
on
14:06
uh several different variables such as
14:08
square footage of turf
14:09
square footage of the home or i like to
14:12
call it the livable square footage for
14:13
the home cleaning industry
14:15
that number coming right off zillow so
14:17
we have a solid number
14:18
we may have also other things linear
14:20
feet we may have
14:21
variables such as small and even large
14:23
shrubs
14:25
or home cleaning industry may be
14:26
tracking some other variables such as
14:28
number of people living in the home
14:30
number of pets number of living areas so
14:32
all these different
14:33
um i’m going to call them custom fields
14:35
or job variables
14:37
are going to go into your crm and based
14:39
on a pricing structure in the background
14:42
will automatically calculate a price a
14:44
budgeted time how long it should take
14:46
and a cost before profit so those are
14:49
the three ways of estimating i’m going
14:51
to recommend staying away away from
14:52
trying to charge market price
14:54
but if you’re not comfortable with a
14:56
production rate based estimating system
14:57
we start with your experience and then
14:59
i’m going to show you
15:00
over the next few slides here how to
15:02
actually take the data
15:03
of when you do those jobs in the
15:04
software and use
15:06
a production rate based system based on
15:08
not industry averages
15:09
but actually how long it takes your guys
15:11
and girls in the field
15:13
um to get these jobs done with your
15:15
equipment as well so it’s a very
15:17
um customized way of estimating based on
15:20
your system so
15:21
off to this point cody any questions
15:23
thoughts uh before we actually dive in
15:25
and
15:26
lift the lift the hood on the actual two
15:27
types of estimating we’re gonna
15:28
recommend you evolve into
15:30
i am really excited about
15:33
the idea of using the data that you’re
15:36
collecting
15:37
day in and day out in your business and
15:39
like
15:40
putting it to work to optimize other
15:42
parts of your business
15:44
like that is your your data is unique to
15:48
you and no one can come in and tell you
15:50
like
15:51
oh you should be charging x for that
15:53
line like i see so many posts online and
15:55
comments on youtube channels and stuff
15:57
that are like
15:57
how much should i charge for you know
16:00
xyz lawn
16:02
and it’s like they don’t know your
16:03
equipment they don’t know how fast your
16:05
employees work
16:06
they don’t know what you know the going
16:08
rates for labor are in your market
16:10
like all of these factors but if you
16:12
have
16:13
a target and you have the data like mike
16:16
is talking about here
16:17
you can actually know that your prices
16:20
are going to be profitable and not like
16:21
you know some
16:22
shot in the dark yep and i really love
16:25
the fact that you said that cody before
16:26
we really dive into
16:27
the executables you can take away to
16:29
implement your business today is
16:31
uh if you take an example of jonathan of
16:32
the lawn care millionaire he owns a
16:34
uh a very successful lawn care business
16:36
in um
16:38
richardson texas i believe in that
16:39
frisco market
16:41
but if you look at jonathan’s setup in
16:42
his lawn care business they’re running
16:44
either used ford rangers or used f-150s
16:48
they’ve taken these trucks and he’s very
16:50
he’s revolutionized the way lawn care
16:51
and equipment is taken care of
16:53
uh he’s put basically a dovetail with
16:55
two mowers
16:56
the weed whackers blowers all in on one
16:59
truck without a trailer
17:00
now that works great in a lot of markets
17:03
um
17:04
but if you went to a northeast market
17:05
where like i’m at and
17:07
you’re doing snow removal four to five
17:09
months a year that little
17:10
ford ranger or an f-150 that’s two-wheel
17:13
drive
17:14
probably use is not really gonna cut it
17:15
up here so you may look at it like well
17:18
jonathan obviously is the expert of that
17:20
area and i’m going to base my prices on
17:22
jonathan’s
17:22
business over there if i could get my
17:24
hands on them um obviously you probably
17:25
can’t get your hands on it but if you
17:27
could
17:27
i think that would be a very dangerous
17:29
thing to do if you’re living in the
17:30
northeast where i’m at because where
17:32
it may be costing him twelve to fifteen
17:34
thousand dollars to put a new crew on
17:35
the road far as equipment and everything
17:36
in
17:37
that same exact setup in the northeast
17:39
is probably between fifty to sixty
17:41
thousand dollars
17:42
so basically round numbers jonathan may
17:44
be able to put five or six crews on the
17:46
road for the cost of one crew with the
17:48
larger mowers in the northeast market so
17:50
those are the things that scared me when
17:52
you mention that cody on the facebook
17:54
page is because
17:55
um you need to really base it on your
17:57
business
17:58
your overhead and your equipment setup
18:00
and i’m going to show you how to exactly
18:01
do that right now
18:03
absolutely so the first way of
18:05
estimating outside of basing on your
18:06
competitors which we’re not going to
18:07
recommend
18:08
is my favorite guesstimating we’re going
18:11
to go out and guestimate
18:13
basically it’s time-based but a lot of
18:15
people are guessing based on their
18:16
knowledge and yes that is going to be
18:18
better than actually
18:19
copying your competition’s pricing
18:20
because your competitor may have the
18:22
jonathan set up of
18:23
10 to 12 thousand dollars per truck and
18:25
you may have a 60 thousand dollar setup
18:32
so what we’re going to recommend is
18:33
we’re going to do a time-based
18:34
estimating i like to call
18:35
guesstimating to have a little fun with
18:36
it but if you’re going to go out we want
18:38
to base it on your experience so step
18:40
number one we base it on your experience
18:42
how long you think it’ll take
18:44
now underneath that assumption you need
18:45
to determine before we go out and start
18:47
these estimates what is your dollar
18:49
per man hour charge and we’re always
18:52
going to base it on one person so
18:54
things to consider and track is how many
18:56
minutes how many hours or how many days
18:59
for one person and why one person is
19:01
important
19:02
um in a perfect scenario if we had a
19:04
two-man crew
19:05
um they would always show up and there
19:07
would be no call no shows
19:09
but in the real world especially the
19:11
service industry we’re going to have
19:12
disruptions we’re going to have people
19:14
that don’t show up
19:15
so what we would do um in your in your
19:17
software such as service autopilot
19:20
i love the way service autopilot has set
19:21
this up because it’s based on one person
19:24
and then when you add the additional
19:25
people for the crew for that particular
19:27
day it tracks
19:28
how long it should take based on the
19:30
actual crew but going in to estimate the
19:32
beginning of the season before those
19:33
crews are set up
19:35
we don’t know who’s going to be on those
19:36
trucks for the whole entire year we
19:37
don’t know
19:38
um if it’s going to be a one person or
19:39
two person crew if you’re in home
19:41
cleaning you may have a top to bottom
19:42
deluxe that it’s so big you may require
19:44
three solo cleaners to come in
19:46
so the idea is we want to consider how
19:48
long it’ll take for one person to do the
19:50
entire job
19:51
and then when you go to schedule and set
19:52
that crew up um it’ll divide out by how
19:55
many people on the crew from the
19:56
budgeted time
19:57
so you may be wondering why would i want
19:59
to know different minutes
20:00
hours or days well based on a crm such
20:04
as service autopilot
20:06
this is going to give you that
20:07
granularity so minutes are very pretty
20:09
obvious how many minutes is it
20:11
is it 60 minutes 30 minutes 120 minutes
20:14
that’s going to give you the most
20:15
granularity to be competitive
20:17
in there so it’s going to basically take
20:19
how many minutes
20:21
times your hourly rate and set a price
20:23
now hourly jobs could be
20:26
a spring or fall cleanup traditionally
20:28
we round those up to the highest hour or
20:30
in the cleaning industry maybe it’s a
20:32
post construction clean those are
20:33
usually
20:34
built out by the hours we’re kind of
20:35
looking at them so some ver
20:37
and if you’re an hour or two high or low
20:38
it’s not going to kill you when you go
20:39
to put the estimate it’s not going to
20:41
fresh out
20:42
um and then other jobs maybe design
20:44
build maybe you’re doing a paper patio
20:45
job
20:46
and a hardscape and that may be a 45 or
20:48
60 day
20:49
um bid so you’d want to go in and say
20:52
okay
20:52
we’re not going to charge by the hour
20:54
charging by the day so we have a set
20:55
price for the day for the laborers that
20:57
we would be putting on that so
20:59
those are the three main ways we see for
21:01
success setting this up inside service
21:03
autopilot
21:04
we want to look at how many minutes
21:05
hours or days now other items you want
21:07
to consider is okay this is great we’re
21:09
in this time based or guesstimating
21:10
system
21:11
but we really within three to six months
21:14
want to evolve into that production rate
21:16
based system of coding so
21:18
how do we do that well not only do we
21:20
track the minutes hours or days but we
21:22
need to go in and consider the area
21:23
we’re servicing
21:24
and we’re going to define that as the
21:26
square footage of say turf
21:28
linear foot of edging or the size small
21:31
medium and large shrubs so we want to
21:32
collect those
21:33
job variables or custom fields so we can
21:36
put them in the back of the software so
21:38
once we have a statistical mean
21:39
of enough data between three and maybe
21:41
six months we can run those reports in
21:44
the back end of the system i’m going to
21:45
show you here
21:46
shortly how to get a production rate
21:47
based estimating system based on your
21:49
equipment setup
21:50
and the guys and girls on your team now
21:52
some other things that we talked about
21:53
it was cody was
21:54
eroding that bottom line profit and
21:58
maybe five percent is the industry
21:59
average for lawn care i’m going to
22:01
recommend you don’t leave your shop for
22:02
at least 10
22:03
double digits but a lot of people will
22:05
start out that the 18 to 20
22:07
net margin which is you know 15 higher
22:10
than the average
22:11
but that just gets eroded because we
22:14
think it’s all going to come out in the
22:15
wash but it doesn’t
22:16
so shop time loading and unloading your
22:18
trucks uh
22:19
and cleaning is the same thing unloading
22:21
loading those cars having those am
22:23
meetings
22:24
those are time sinks but we need to have
22:26
those meetings to bring our teams
22:27
together
22:28
drive time from the shop to each job and
22:31
back to the shop
22:32
and material pickup in addition
22:34
landscaping may have debris disposal
22:36
there’s several other
22:37
items here but we need to think about
22:39
all the things that are going each into
22:40
those jobs
22:41
and consider how do we track them and
22:44
how do we integrate their cost
22:46
and cover those costs plus our desired
22:48
margin for profit
22:49
and build that into the minutes hours or
22:51
days in there because it’s not enough to
22:53
just
22:54
take care of what’s on site we need to
22:57
take care of those other areas
22:58
that are sucking the time down and
22:59
eroding those bottom line profits
23:01
and in addition if you’re still in your
23:03
guesstimating time-based phase
23:05
you need to spend the extra time to grab
23:06
your square footage linear feed your
23:08
size variable to your
23:09
servicing so we can run those reports
23:11
and then evolve into
23:12
that production rate based estimating
23:14
system so next step is
23:16
well real quick on those inefficiencies
23:20
i think it’s really important to to
23:22
state the like positive side
23:24
of that as well which is every single
23:27
one of these that you attack
23:29
and you find a way to to get some of the
23:31
inefficiency out
23:33
is uh like instead of just thinking of
23:36
it as
23:36
eroding your bottom line when these
23:39
things go wrong
23:40
every one of these that you fix is more
23:42
money in your pocket
23:44
uh like these are just things that are
23:46
bogging down
23:47
your margin and so any of them that you
23:50
can
23:51
iron out is money right into your pocket
23:54
yeah i couldn’t agree with you more so
23:55
once we once we figured out the the time
23:57
based system we went to this production
23:59
rate based estimating system which i’m
24:00
going to show you in a few minutes here
24:02
when we dialed it in we were at we’re
24:04
adding an extra 1300 to 1200
24:07
so 12 to 1300 a week in extra sales
24:10
without changing piece of equipment or
24:12
guy or girl on the team that was
24:13
bottom line profit but once we dialed
24:15
this in and created accountability
24:17
uh we were able to accelerate the amount
24:19
of sales on each crew
24:20
each week and literally it went to the
24:22
bottom line profit so i’m glad you
24:24
brought that up cody
24:26
so now that we’ve got this time based
24:28
system or guesstimating i like to call
24:30
it um
24:32
a lot of times especially in the spring
24:34
if you got a sales goal in the back your
24:35
head or hopefully up on a dry erase
24:36
board or somewhere
24:37
uh in your office i would potentially go
24:41
up to a house and say okay
24:42
um well it’s one hour times by 50 bucks
24:45
an hour it’s a 50
24:46
job but and if i give i took two three
24:48
dollars off that
24:49
50 job and made it 47 i bet you i could
24:52
definitely get that job
24:53
so what happened is it was some emotion
24:55
that started to work its way in there
24:56
especially during the sale season so
24:58
i said how can i take the experience in
25:01
my head
25:02
or somebody in the field’s head that’s
25:03
doing these estimates for me
25:05
and create a non-emotional way to create
25:06
this price so
25:08
what we did is once again we based it on
25:09
minutes hours or days for one person
25:12
and we consider the drive time debris
25:16
disposal material pickup
25:18
and material job pickup if we were going
25:20
to the nursery to pick some things up
25:21
but what we did is we created a
25:22
standardized form and this
25:24
revolutionized the business we put it on
25:26
our mobile app
25:27
on service autopilot and what the
25:29
estimator would do we’ve kind of dubbed
25:30
this the on-site estimate form it’s kind
25:32
of something particular that we just do
25:34
at my old company and now simple growth
25:36
this is what we we recommend because
25:37
it’s a non-emotional approach
25:39
but we’re going to use this in a lawn
25:41
care example we’ve got the number of man
25:43
minutes to mow the lawn so that’s mo
25:44
blown edge
25:45
and we’ve broken our drive time into
25:47
three different zones so we put the
25:48
minutes or hours in there
25:50
and we select the zone and then when we
25:52
pull up the estimate
25:53
in service autopilot it calculates the
25:55
price on site
25:56
and the drive time and it’s going to
25:58
give us a budgeted time for both and a
26:00
cost before profit all the consumers
26:01
going to see in the bottom line is lawn
26:03
mowing
26:03
but now we’ve taken the emotion out so
26:05
we’re putting in the raw data as we walk
26:07
around the property on our mobile phone
26:09
and when we pull up that estimate
26:10
that is the price and the ground rule
26:13
with people that come in to do a two day
26:14
deep dive with simple growth as a
26:16
certified advisor
26:17
or any of our consulting clients is that
26:19
price can never go down
26:20
it can go up so if you’re ever going to
26:22
let someone in your business
26:24
manipulate that price it’s going to go
26:25
up it never should go down so there may
26:28
be
26:28
a smaller gate or something that matrix
26:30
didn’t account for so you can go up
26:32
but you really don’t want to go down and
26:33
that’s how we’re going to preserve
26:35
and protect those bottom line margins to
26:37
hopefully 10
26:38
and above not the industry average so
26:40
the next thing is
26:42
great example shrub pruning so we’ve got
26:44
the number of man minutes
26:46
so how many minutes will it take to
26:47
prune those shrubs and clean it up
26:50
and get the debris on the truck and then
26:52
how many shrub pruning debris disposal
26:54
trips is it so maybe it’s a commercial
26:56
hoa job and you’re gonna be there a
26:58
whole week or two you got thousands of
26:59
bushes so
27:00
how many trips to the dump are you going
27:02
to actually get rid of this degree
27:03
or is it one but we’re covering that
27:05
time and the cost to dispose of it if
27:07
you’re paying to get rid of it
27:08
and we’ve got our drive time zones down
27:10
here so these are the things
27:12
that we can even go into that
27:14
guesstimating or time based system
27:16
and standardize and start to create
27:18
predictable non-emotional estimating
27:20
i don’t want to leave my home cleaning
27:21
friends out of this so we’ve got
27:23
same thing here in cleaning um if you’re
27:26
on
27:27
site you’re walking around the home
27:28
you’d have that mobile app or
27:30
if you’re going in and taking some
27:31
intake over the phone and there’s
27:32
certain questions you can ask based on
27:34
the zillow information and
27:36
getting the number of people pats and
27:37
living areas what you’re doing is really
27:39
you’re plugging in
27:40
for a top to bottom deluxe here the
27:42
number of hours you think it’s going to
27:43
take for one
27:44
cleaner the weekly hours the bi-weekly
27:47
the monthly and then the general clean
27:48
and the cool kind of thing here is
27:50
whether it’s lawn care home cleaning you
27:51
may have different hourly rates
27:54
for a weekly bi-weekly monthly if it’s a
27:56
general cleaning that general cleaning
27:57
price may be an extra five dollars per
27:59
cleaner higher
28:00
but now we’ve created a process you plug
28:02
the data in
28:03
we select the estimate template it loads
28:05
and the services are all there with the
28:07
price
28:08
budgeted time and net profit so now
28:09
we’ve taken that emotion
28:11
out of your guesstimating system and
28:14
hopefully we’re tracking the square
28:15
footage or the linear feet of the units
28:17
to going to be able to run those reports
28:19
so any questions on a high level cody
28:21
before we actually get into production
28:22
rate based estimating now that we’ve got
28:24
this data actually to
28:25
create a process on our own numbers on
28:28
on the emotions front my my only thought
28:31
is that
28:32
anything like a dollar here and there
28:34
doesn’t seem
28:35
like a big deal until you’re trying to
28:38
scale
28:39
this business and all of those uh
28:42
emotional dollars where you cut your bid
28:44
back a little bit
28:45
uh in an attempt to win some more
28:47
business all of that is going to come
28:48
back to haunt you the bigger your
28:50
business gets
28:52
yeah and i’m just pulling my phone here
28:53
just give you a rough number it’s very
28:54
interesting so
28:56
would you say if you owned a service
28:57
business that you could eliminate
28:59
six hours of waste i mean six minutes of
29:01
waste per hour
29:03
in your business over over a 10-hour day
29:06
yeah definitely so if you had a two-man
29:09
crew
29:10
times 10 hours
29:14
times four days a week so you’re working
29:16
four tens it’s eight hours of waste a
29:19
week that you’d be saving
29:21
and let’s just say your cost to operate
29:23
on average is about 36 bucks an hour
29:26
so it’s 288 expense you’re saving every
29:30
month
29:30
or every week i’m sorry let’s say you
29:32
got a 45 week season
29:34
it’s 12 960 of bottom line profit
29:38
for eliminating six minutes of waste now
29:40
multiply that by five or six crews
29:43
that and that’s just one little piece of
29:45
this so we want to start to take that
29:46
emotion out
29:47
and really streamline these estimates
29:49
because if you start pulling a couple of
29:50
those minutes out
29:52
shaving that price emotionally that can
29:54
have the same negative effect
29:55
but we start saving that time we can
29:57
really do that as well
29:59
so production rate based estimating is
30:01
really where we want to be um
30:03
and basically you are going to base it
30:06
on a production rate of pieces of
30:09
equipment and time to do this so we
30:11
first we want to go out and say okay
30:13
based on our time i can mow blow an edge
30:17
a thousand square feet in x amount of
30:20
time
30:20
and then we’d multiply that time times
30:22
our cost to operate our breakeven it
30:24
would give us our cost
30:25
we’d also have the budgeted time in
30:27
addition once you figure out these
30:29
production rates for each type of
30:30
service you have
30:31
we need to once again determine a dollar
30:33
per man hour charge
30:35
so is it 45 50 55 per hour per person
30:38
now the other thing too is if you’re
30:40
still in the field as the business owner
30:42
this is another big mistake in
30:43
in the early years i didn’t really
30:44
conceptualize this well i own the
30:46
business i don’t have to charge for
30:47
myself
30:48
you absolutely do um so as you’re
30:51
starting to look at this stuff make sure
30:52
you’re including
30:54
if you’re on the site even managing or
30:56
helping the guys and girls on the team
30:57
out for a half a day or a quarter day
30:59
and managing that
31:00
uh if you’re actually physically doing
31:01
the labor you need to be billing out for
31:03
that in an
31:04
hourly charge and once we created this
31:07
production rate based estimating system
31:08
on hopefully your numbers now after
31:10
we’ve gone through the time based
31:11
guestimating system
31:12
uh things we need to track are linear
31:14
feet square footage sizes small medium
31:17
and large
31:17
and number of items people pets living
31:19
areas whatever that is
31:20
in your specific industry
31:24
so once again i really like this on-site
31:27
estimate form idea but now we’re not
31:28
tracking minutes
31:29
hours and days we’re actually tracking a
31:32
variable and what that variable is going
31:34
to be
31:34
is long square footage in lawn care
31:37
length of
31:38
landscape bed the linear foot so before
31:41
edging the beds whether it’s a
31:42
production rate for shoveling
31:43
or a mechanical edge landscape bed
31:47
square footage right here so i’ve got
31:48
mulch at one two and three inches so
31:50
what we’ve done behind the scenes in
31:51
service autopilot says
31:52
well based on the bid or the estimate
31:55
what’s the depth
31:56
and i just plug in the square footage of
31:58
the bed
31:59
on the particular depth i want and
32:01
automatically does the calculation
32:03
um mulch bed square footage for weeding
32:06
so we got a production rate for reading
32:07
a bed that’s already been maintained
32:09
and then we have one that hasn’t been
32:10
maintained and then we’ve got how many
32:13
drive trips to the nursery or your shop
32:15
to load up the truck
32:16
based on that job so we’re including
32:18
that mobilization
32:20
so as we’re looking at this we want to
32:22
be able to standardize and delegate
32:24
as much as possible over the phone
32:26
through a product like smart maps or
32:27
maps pro depending on
32:29
version two or version three of service
32:30
autopilot we can go in and measure that
32:33
but sometimes you have to go out in the
32:34
field to do these things so you have
32:35
that mobile form and you’re walking
32:36
around you’re not scribbling on a piece
32:38
of paper and
32:38
hopefully it’s not raining and the inks
32:40
running off the side of the paper by the
32:41
time you get back to the office
32:42
you have no idea what you did but these
32:45
are some of the variables and then we’ve
32:46
got
32:46
the example for shrub trimming again
32:48
here and the shrub trimming example
32:51
goes in and literally has you count the
32:52
number of large medium small
32:54
shrubs so small shrubs are going to be
32:56
up to three feet medium they’re gonna be
32:58
between three to below six feet
33:00
and then a large is in between six and
33:01
ten feet and then in the bottom there
33:03
if you can see it is we said the number
33:05
of uh
33:06
hedgerows with a ladder and then without
33:09
a ladder and they’re based on 10 linear
33:11
feet so you can actually measure those
33:13
over the smart map or if you got one of
33:14
the handy wheels and you’re on site you
33:15
wheel it out
33:17
but the gentleman that ran my business
33:19
never cut a
33:20
lawn in his life never mo never mowed
33:22
never mulched a bed he was a commercial
33:24
fertilizing
33:25
uh technician uh really good at this
33:28
crap there but i said how do i take a
33:30
guy
33:30
that has never done any of these things
33:32
and have him accurately estimate
33:34
a job that i had 25 years experience in
33:37
with no emotion so we had to find
33:39
variables or custom fields that’s what
33:41
we put them into
33:42
to track this and this is how we did it
33:44
believe it or not uh this gentleman
33:45
literally was within a dollar or two of
33:47
my estimating
33:48
uh with 25 years experience after a week
33:50
or two of using this system
33:52
so that’s how we went from 100 hours a
33:54
week to three to five to
33:56
an absentee owner because this at least
33:58
in my opinion in my business was
34:00
this was the scariest part to give away
34:01
because either the person’s going to be
34:03
way too high we’re not going to get any
34:04
work they’re going to be way too low we
34:06
have so much work we don’t know what to
34:07
do with and we’re losing money
34:09
um how do we get them right in the
34:11
middle so we’re getting the jobs we’re
34:13
most profitable and we’ve got
34:15
accountability uh
34:16
this was the process that we used in my
34:18
business and
34:19
a lot of other businesses are using it’s
34:21
very very helpful to take the emotion
34:23
out
34:23
um and get accurate delegatable
34:25
estimates in the cleaning industry
34:27
the way you’re gonna be looking at this
34:28
here potentially is you’ve got your home
34:29
square footage that’s the cleaning area
34:32
you’ve got the number of bass number of
34:33
bedrooms number of stories of the home
34:36
number of living areas what kind of
34:38
flooring is it is it wood tile
34:40
carpet that’s going to pull into a
34:41
production rate because if it’s all
34:42
hardwood floors and using a product like
34:44
bona
34:45
you’re going to probably get through
34:46
that a little bit quicker than if you
34:47
actually have to go out and vacuum all
34:49
those floors is it low pi is it high
34:51
pile
34:51
what is like what does that look like
34:53
because you’re going to have a different
34:54
production rate based on the different
34:56
flooring
34:57
number of pets and people what is that
34:58
dirt factor debbie sardone calls it the
35:01
dirt code
35:02
um more people more pets the more filth
35:05
is gonna be in that house the longer
35:06
it’s gonna be taking
35:07
um so these are the things that we in my
35:09
opinion should be looking at
35:11
to create the foundational parts of
35:14
the second part of this talk how do we
35:15
take that data and actually track it
35:18
bring accountability with quality and
35:19
then raise our prices based on it
35:23
so as we go into here the main thing is
35:26
building out your services
35:28
and having a trackable way of doing it i
35:30
like to call this the blueprint it’s a
35:31
simple growth blueprint
35:32
and cody i know we’ve talked about this
35:34
before but you don’t build a house
35:35
without a blueprint you don’t put doors
35:36
and windows
35:37
in random places and expect the house to
35:39
work well you really
35:41
don’t want to create a pricing matrix
35:43
the
35:44
the thing that’s going to calculate your
35:46
prices without a blueprint
35:48
and this is why we take it outside of
35:49
the software before we put it in the
35:51
software
35:52
and what you’ll see here is in the lawn
35:53
mowing and i’m also going to show a
35:55
cleaning example is
35:56
what we ask for is what is your base
35:58
price the lowest price that you would be
36:00
willing to show up so it’s 45 bucks for
36:01
lawn mowing
36:02
that will cover in this this fictitious
36:04
example it’ll cover 50
36:06
or 5 000 square feet to mow blow an edge
36:09
next question is how long is that going
36:10
to take one person and that’s the key
36:12
once again
36:13
we don’t care if you have a two-person
36:14
three-person crew we base it on one
36:16
person and then we’ll figure it out on
36:18
how many people show up that day
36:20
but we’ve got point three three we got
36:21
20 minutes to mow blow an edge
36:23
so what we’re going to do is take your
36:25
numbers so if you’re using an industry
36:27
professional such as jason cupp
36:29
a gentleman like that is going to be
36:30
able to go and build a budget for you
36:32
and say this is what you need to charge
36:33
per hour
36:34
and this is what it’s costing per hour
36:36
before you make a net
36:37
profit and those are the non-emotional
36:39
numbers we need to plug into this sheet
36:41
and now some areas an essay that i’ll
36:43
i’ll hit on in the next screen to show
36:44
you how we actually plug this in
36:46
but the idea is the sheet is checking
36:48
your profit and profit percentage
36:50
and then we’re saying if it’s more than
36:52
5 000 every thousand square feet
36:54
over our base price is an additional two
36:57
dollars and seventy five cents
36:59
point oh five hours and a cost of a
37:01
dollar eighty before
37:02
profit so now we’ve taken what it should
37:05
look like we’ve tested the math
37:07
and now on the next screen i’m going to
37:09
show you how we take
37:10
the top five lines here and they line up
37:12
perfectly to the matrix and sa
37:14
and the bottom five points line up
37:15
identically so this is your blueprint
37:17
to replicate it inside service autopilot
37:19
and then let’s just say going into next
37:21
year cody
37:22
your price has changed and you maybe go
37:24
to jason cupps financial roundtable and
37:26
jason says you know what cody
37:27
you can’t charge 55 anymore you got to
37:30
charge 60
37:31
and it’s costing you 38 an hour now to
37:33
operate before profit
37:35
so when you update those cells obviously
37:37
this is a static slide
37:38
everything updates in this blueprint and
37:40
then you just have yourself an admin go
37:42
in
37:42
and simply copy those five lines write
37:44
an essay so now you have a blueprint
37:46
and then you have a record of what you
37:48
did 12 months before so now you got
37:51
you know because 12 months goes on you
37:53
don’t remember what you did
37:54
so now we’ve got a blueprint so
37:56
hopefully that makes sense and then the
37:58
cleaning as well
37:59
very similar uh we’re going to go and
38:01
say what’s your base price for a say
38:02
weekly cleaning well i’m not going to
38:04
stop for less than 145 bucks
38:07
and that’s going to cover up to 1200
38:10
square feet
38:11
we’re going to give it 2.9 hours and if
38:14
this cell was filled in here we tell you
38:16
how much it cost per hour break even
38:17
based
38:18
on that expense of 35. then we’re saying
38:20
every 500 over the base price of 1200
38:23
is gonna be an additional 48.97 hours
38:26
in a cost of 33.83 so
38:30
that is the cost before profit and we
38:33
extract this number from this number and
38:34
that’s what that
38:35
net profit would be so those are the
38:38
things we want to look at but once you
38:40
got this blueprint
38:41
now it demystifies going into a product
38:44
like service autopilot
38:45
it simplifies it so you’re going to go
38:47
in and you’re going to create your
38:48
calculation
38:49
and 99.9 of the time it’s always going
38:52
to be your option of quantity rate times
38:53
visits
38:54
and we’re going to base it on a custom
38:56
field so those are your job variables so
38:57
now we’ve
38:58
evolved from our time based or
39:00
guesstimating system
39:02
and we’re basing it on turf square
39:04
footage
39:05
now if you’re in the guesstimating phase
39:08
your custom field could be
39:09
number of man minutes to mow number of
39:11
man hours to clean
39:13
number of days of hardscaping so that
39:15
also works
39:16
most people don’t realize you can base
39:18
that custom field here
39:20
on a time variable as well and then when
39:21
you have the data
39:23
we’re going to evolve into something
39:25
like square footage of lawn or home
39:27
but right here you can kind of see it is
39:29
a screenshot from the previous screen
39:32
those five cells right there are
39:35
automatically lining up right now and
39:37
you just plug them in
39:39
so there’s no guesswork we’re
39:40
demystifying service autopilot and
39:42
making it a plug and play system
39:44
and now every thousand square feet over
39:46
the 5 000 if you click back to that
39:48
screen believe it or not it’s these five
39:50
cells
39:51
very very simple it looks confusing if
39:54
you got in here and you didn’t know what
39:55
it was but if you can blueprint it
39:56
and then implement it those are the keys
39:59
to success and these are the
40:00
foundational parts cody
40:02
that led to financial success in my
40:04
business and hundreds of businesses
40:05
we’ve worked with as a certified advisor
40:07
we want to simplify it we want to check
40:10
the numbers and have that blueprint that
40:12
we can update every year
40:13
and raise our prices accordingly now
40:17
now that you’ve got all this cody the
40:18
next thing is we got to go out and get
40:20
the work done
40:22
so as we’re going to get the work done
40:24
how do we track our daily wins and
40:26
losses
40:26
and how do we actually go out and get
40:30
our team to see what’s going on so
40:35
this is how we did it and this was the
40:36
manual version and at the end i’ve got a
40:38
really really cool thing to show you
40:40
we’ve cracked the code on automating
40:43
this whole entire report and another one
40:45
i’m going to show you in the service
40:46
autopilot report center
40:47
with no emotion um so this is this is
40:50
really cool i’m going to get excited
40:52
here probably but the idea here is that
40:55
off your closeout day screen uh you
40:58
should have a budgeted time so if you
40:59
set a budget of time for every job you’d
41:01
enter
41:01
into the sheet here and we’d put a start
41:04
and stop time
41:05
and we’d have total hours lunch and how
41:06
many people are on the crew and it’s
41:08
going to give you a percent of budgeted
41:10
time so being
41:11
live here i’m going to probably risk
41:13
this and see what happens i’m going to
41:14
click on this link here to see if i can
41:15
pull up the large view of this and
41:16
all right we’re good so if i disappear
41:18
from the show cody uh
41:20
as we have the last few weeks or our
41:21
other guests uh old site i’ll be back
41:24
but what we’re looking at here is and
41:27
let me see if i can bump this up a
41:28
little bit so folks can see this
41:30
oh you’ve got something interesting
41:33
going on here so you’d plug this in
41:34
from 7 to 5 p.m they worked a 10 hour
41:37
day
41:38
and a half hour for lunch you
41:39
potentially have the crew members names
41:41
in here
41:41
and how many guys are girls around the
41:42
crew too so what this is saying is
41:45
this is your from clock into clock out
41:47
from the shop
41:49
now i’ve got my budgeted time this is
41:50
coming out of your closeout day screen
41:52
in service autopilot
41:53
so those are all your budgeted time so
41:55
this crew has been given 18 hours to get
41:57
the job done
42:00
if you took 18 and divided by two that’s
42:02
how many total hours you got nine hours
42:03
for the day
42:05
um so we’ve got gross hours of 20 we
42:07
have an hour of lunch for two folks
42:09
and we’ve worked 19 hours so you’re
42:12
that’s your payroll hours you’re going
42:13
to pay them 19 hours of payroll
42:16
problem cody here is we’ve only given
42:17
them 18. so we’re one hour over budget
42:22
now how do we translate this to our team
42:24
well
42:26
it’s actually it’s a pretty simple
42:27
process so
42:30
if you can see this here this 94
42:33
that’s the number and on the next slide
42:35
i’ll show you how we did it but we’re
42:36
going to actually
42:37
post this in our shop on the dry erase
42:39
board or the tv or whatever that is
42:42
um but when we first did it we would put
42:44
uh
42:45
the budget the actual physical hours for
42:47
the crew and it created animosity
42:49
because some crews inevitably would get
42:50
more hours and some would get less
42:52
depending on how hot or cold it was or
42:53
where we’re at the season you couldn’t
42:55
win
42:55
like oh you gave us too many hours they
42:57
only had to work 40 hours we had to work
42:58
50 hours day in the holiday week
43:00
whatever it is you don’t want to put the
43:02
hour so what i’m recommending is we make
43:04
it a percentage here
43:05
apple’s apples so if it’s one hour or
43:07
100 hours it’s it’s
43:08
it’s a percentage it’s non-emotional so
43:11
as we built the math behind this coding
43:14
i said how can we simplify this for our
43:16
team to understand
43:18
and just literally make it drop dead i
43:20
don’t want to see stupid
43:21
but easy to understand and what we did
43:23
is
43:25
if you were over budget so that’s not
43:27
good like you took an hour longer than
43:29
it should have
43:30
you didn’t do your job so you only gave
43:32
94
43:34
and there’s a quality constraint a plus
43:36
and minuses behind this i’ll show you
43:38
what that looks like on the next screen
43:39
because we can’t only do production but
43:41
we need to have quality with it as well
43:43
but let’s say we we changed this up and
43:45
it was actually 19
43:47
um hours 19. so when the sheet updates
43:50
here
43:51
it’s gonna actually come out to a
43:52
hundred percent so cody i can say hey
43:54
you did your job today you
43:55
hit your time dead nuts you gave a
43:57
hundred percent
43:59
perfect and we got a quality constraint
44:01
you gave 100 what if i said you know
44:02
what cody i’m going to give you 20 hours
44:04
and you did it in 19 so you’re one hour
44:05
under budget well you gave 105
44:08
today you kicked butt and you had a
44:10
quality constraint so now you can see
44:12
um not that our employees aren’t smart
44:15
they definitely are
44:15
but these aren’t things they’re probably
44:17
used to looking at so if we can break it
44:18
down of giving 100
44:20
with a quality constraint it’s going to
44:21
be significantly easier for them to
44:23
understand that
44:26
so as we go in then
44:33
this is a sheet that we used or a
44:34
replication of the sheet that we used on
44:36
the dry erase board of callaghans
44:37
but as you can see we’ve got all of our
44:39
crews listed here fictitiously
44:41
and we’ve got a percentage budget so
44:43
that’s that
44:44
percentage that we had we have a quality
44:46
score what we did is we had the manager
44:48
go out to a sampling
44:49
internally of every every day of each
44:52
crew and they would give a
44:54
plus or minus one and if there was like
44:55
damage like a window busted or something
44:57
purposely
44:58
that may have a larger negative value
44:59
but the idea is a complement
45:02
is a one negative is you know under
45:05
under under quality so we had internal
45:07
qc and then we had external qc
45:09
so basically that was our clients
45:11
writing in and giving compliments or
45:13
complaints via the phone so we had
45:15
internal qc and external qc for clients
45:17
and what we did just here on crew one
45:19
is we had a percentage for the week so
45:21
their overall budget percentage was 93
45:24
so they’re about
45:25
seven percent over budget and we had a
45:27
quality score of six
45:29
so we would track each day and then the
45:31
following monday
45:32
we’d have a little huddle and we’d go
45:34
through each crew and then the winner
45:36
based on percent of budget quality a
45:38
combination of both
45:40
would get a gift card to say the movies
45:42
or going out to dinner whatever that was
45:44
we tried to stick away from these gift
45:46
cards being to go out for like a gas
45:48
card or groceries because we actually
45:49
wanted to spend the time with the
45:50
friends or family
45:51
uh enjoying that for that recognition
45:54
and then we’d have our crew
45:55
averages right here as well so we know
45:57
as a company as a whole did we win or
45:59
lose
46:00
this day so that’s what’s going in there
46:02
now the final part of this
46:04
as we bring it across the finish line
46:05
because we’re getting to the top of the
46:06
hour here
46:07
is raising prices so
46:10
what our kpi sheet here did is it
46:13
tracked the daily wins and losses so if
46:14
you want to cross a sheet it would have
46:16
all the crews so we could see each day
46:19
and then each week did we win or lose
46:23
but now we gotta figure out we gotta
46:25
we’re gonna raise the prices so how are
46:27
you gonna do it cody are you gonna raise
46:28
it by a percentage or a dollar amount
46:29
across the board
46:31
probably charge everybody five dollars
46:33
more
46:34
probably not the way we want to do it
46:36
yeah
46:38
so what we did here is on the second
46:41
page of that
46:42
sheet we had
46:46
a job costing report and what happens
46:49
here is we pulled this extracted this
46:50
right out of service autopilots um
46:53
pre-built canned reports it looks like a
46:55
little toaster oven in the report center
46:56
on the left-hand side but you pull this
46:58
job cost report on
46:59
so this is just a data sampling of two
47:01
lawn mowing but you would have
47:02
in july 15 you’d probably have 15 16
47:05
cuts depending on the part of the season
47:07
and then
47:07
november december you’d have 30 to maybe
47:09
35 cuts so you got a statistical mean
47:11
but what
47:12
it is we’re charging 54 bucks and 28
47:14
cents a cut
47:15
our average revenue per man hour here is
47:18
54 28
47:19
60 31 so this is actually from the
47:22
mobile phone right here cody clocking in
47:24
and out in sa
47:25
what it’s forcing the office to do
47:27
though when they fill
47:28
those daily things out is they have to
47:31
have good data in there to be able to
47:32
report that out so we’re
47:33
checking our stats and data each and
47:35
every day but on average right now we’re
47:37
averaging 57
47:39
and 30 cents per man hour on site
47:43
now obviously this was pulled out of a
47:44
test account but if we had the
47:46
information
47:47
under payroll job costing on the
47:49
employees loaded in here we’d have a
47:50
labor costing
47:52
and if they use the mobile once again
47:53
highly recommend using it
47:55
clocking in and out of the drive time
47:56
we’d have a drive time cost effect as
47:58
well
47:59
so all the date is here now and then the
48:01
final part that i want to show you here
48:03
is cody’s
48:04
if we were making 57.30
48:07
and our goal right here was 50 we’re
48:09
five dollars and 30 cents
48:11
higher than what our goal is so what the
48:12
sheet saying is you know what mike
48:14
you charge 54.28 your numo price is
48:16
54.28
48:18
you don’t have to raise the price we’re
48:20
making four dollars more than we needed
48:22
but let’s say we went in and our goal
48:24
was 60.
48:26
the sheet now not emotionally says we
48:28
need to charge 2.56
48:30
more per visit on average
48:34
to hit that goal of 60 dollars so if
48:36
your goal is 60 bucks an hour and i’ve
48:38
got one in
48:38
here and i’m making 100 an hour cody i
48:41
don’t want to touch that one
48:42
that is that’s gold but in essence when
48:45
you raise that percentage or across the
48:47
board you’re taking those massive
48:48
profitable clients
48:49
and you’re forcing them to shop you so
48:52
this is the way to go and what we did at
48:53
callahan’s is literally i would go in
48:55
cody
48:56
believe it or not this old mrs smith
48:58
i’ve been cutting since high school i
48:59
don’t want to raise her price i feel bad
49:02
i’d highlight it in black and that would
49:05
drag the formula down and send it to my
49:07
admin and then she’d raise the prices
49:08
when they were out the door then i’d
49:09
have to see
49:10
whose prices went up but that’s that’s
49:11
the non-emotional part
49:13
um so as we close this up this is
49:16
pretty much the um the groundbreaking
49:19
part i like to call it
49:20
version two of kpi and accountability
49:24
automated daily and weekly reports and
49:26
service autopilots report center
49:28
so this is the version of the daily
49:31
verse
49:32
actual thing so remember we said you
49:34
were 125
49:36
or you’re 100 or maybe 85 this crew beat
49:39
their budgeted time they’re all
49:41
125 percent when i put a sum total on it
49:44
these two here would equal 100
49:45
they hit their budget time they’re below
49:47
and over budget would be below again
49:49
but we built this out inside service
49:50
autopilot’s report center
49:52
but that wasn’t enough because the
49:53
biggest thing
49:55
is we knew we could do this beforehand
49:57
but the problem was
49:59
when people get automated reports they
50:01
don’t check the data
50:03
and scott howard had trained over an sa
50:05
with joe conversations we’ve had is
50:08
these reports are powerful but these
50:09
reports are only as good as the data you
50:11
put in them
50:12
so i thought if we were going to build
50:14
this for people in the assay ecosystem
50:16
and utilize it
50:17
it had to make sure there was good data
50:19
so what we’ve done and it took a while
50:21
to figure it out
50:22
we have data checking so we check your
50:25
clock time in and out so if the crew did
50:27
the job and clocked in and out under a
50:29
minute
50:30
you’d have a red button here check your
50:31
data check the billable hours so if
50:34
you’re billing by the hour it’s an
50:35
hourly job
50:36
check the data budgeted hours you don’t
50:38
have budgeted hours
50:40
check the data job amount i can’t tell
50:42
you how many accounts i’ve gone into as
50:43
a certified advisor
50:44
that people have been mowing a lawn for
50:46
free for three four weeks
50:48
there’s no price on there so these cells
50:51
here the way we built it turn red
50:53
if you do not have good data at face
50:56
level
50:57
so now outside of the normal parameters
50:59
yup and now
51:00
we’ve got good data to go run our
51:02
production reports in three to six
51:03
months to go from your guesstimating
51:05
system
51:05
to your production rate based estimating
51:07
system these are the numbers that you
51:08
can use
51:09
uh in your business to to show public
51:11
accountability
51:12
and the final thing i got to show you is
51:14
this is what was really interesting cody
51:17
automated job costs and reports just
51:18
let’s say you’ve got several thousand
51:20
clients who wants to go
51:23
through this this a sheet like this and
51:25
physically
51:26
you know look at this and then drag this
51:30
cell down and run this formula
51:32
and make sure if there was if it was bad
51:34
date he had to go back and fix it
51:36
um and hopefully you caught it all what
51:38
this sheet does as you can see
51:39
check your actual hours check your
51:41
revenue
51:43
and the example up here you probably
51:44
can’t see it on screen on this
51:46
fictitious data set we need to raise our
51:48
price
51:49
five dollars and four cents on average a
51:51
cut to hit our hourly goal of 55 bucks
51:54
and if our average goal of 55 bucks here
51:57
we’re making we don’t have to raise it
52:00
at all
52:01
um i had some fun we had to raise it by
52:02
1200 but that would be an interesting
52:04
report right there cody
52:05
if you’re doing a design build and it’s
52:07
a one-time job
52:08
so what should have i charged now that i
52:11
know i’ve like
52:12
gotten destroyed on this job um but this
52:14
other one for 1290. that wasn’t really
52:17
unusual in our business callahan when we
52:19
first ran this report the first year or
52:20
so
52:21
until we figured it out we had people
52:22
were raising their prices 12 to 15 bucks
52:24
a cut
52:25
believe it or not most of them didn’t
52:27
leave because they knew they were
52:28
getting a smoking deal
52:29
yeah imagine if i had raised it 12 bucks
52:31
across the board and my hundred dollar
52:32
an hour counts
52:33
i would have left yeah so
52:37
this is the key to success in my in my
52:38
business and a lot of people using
52:40
service autopilot
52:41
uh if you want to learn more about pro
52:43
plus reporting on service autopilot
52:46
feel free to reach out to me as a
52:47
service certified advisor there’s
52:48
several other certified advisors
52:50
or give service autopilot a call but the
52:52
thing that you really want to look at is
52:53
if
52:54
you haven’t evolved into the reporting
52:56
the pro plus has that reporting
52:58
and the key thing is you can automate
53:00
those reports on a daily and weekly
53:02
basis
53:02
and you can automate those reports to go
53:04
to you whoever needs to be there
53:06
twice a year three times a year whatever
53:07
that is to raise your prices so it’s not
53:09
only enough to have it
53:11
but the automations on pro plus allows
53:14
you
53:14
to be empowered and make sure what
53:16
should happen happens when it should
53:17
happen
53:17
without having to remember because let’s
53:19
face it in the middle of july it’s crazy
53:20
we’re not thinking about going an audit
53:22
in our prices and possibly raising our
53:24
prices at the best time of the year
53:25
because
53:26
most service businesses aren’t returning
53:27
phone calls or doing estimates they’re
53:28
too busy
53:29
so why not raise your prices on just the
53:31
losers just like jack welch raised the
53:33
prices on
53:34
the bottom 10 percent we can
53:36
systematically go and elevate ourselves
53:37
from that five or 19 percent of cleaning
53:40
up to double digit profit margins and be
53:42
the leader in our industry so
53:44
cody that’s all i got i know we went a
53:45
little over time but i thought it was
53:46
important to
53:47
uh kind of just lift the hood of what
53:49
you can do in your business
53:50
foundationally from
53:51
guesstimating to production rate
53:52
estimating how to report get buying
53:55
quality and then let the power of
53:57
service autopilot automate it
53:58
and make those non-emotional changes for
54:00
you that’s awesome
54:03
awesome all right well i know we’re at
54:05
the top of the hour so until next week
54:07
essay weekly talk show
54:09
uh with hopefully special guest martha
54:11
woodward
54:12
coming out um and we will see you again
54:15
next week cody appreciate it coming out
54:17
1 p.m eastern 12 p.m central essay
54:20
weekly talk show episode
54:21
54 check it out on all your podcast
54:24
outlets as well
54:24
i should be up live probably by the end
54:26
of the day awesome
54:32
if you like this show you might want to
54:34
check out our resources at www.start
54:39
while you’re there enter to win an
54:41
estimator chat bot
54:43
mike callahan is available for private
54:45
coaching