 Good afternoon, everybody. Tom Stewart here. I'm with Riz Trotter. This is smart business moves. Hey, y'all. It's Thursday Last day of the week for us for smart business moves week. That's right Four-day work week. Yep. Yep You wish That's funny Take the next three days off. Yeah, that that's the plan Tom It's amusing. I'm using you're never gonna do that. I don't know who you're kidding. What are you talking about? There are people I mean, you know, you know, I know you know people that can tell you to the day how many days they have until they're gonna retire That is true Do they do that in this industry too? I guess they do. Yeah Yeah, maybe Or at least I know a lot of people that you know aspire to get your business at the point where they can sell it and Not have to do anything I remember when Alice and Palmer retired. So, yeah You know, they they do that in this industry Uh, I'm trying to think of somebody. There's another guy too. What's his name Steve? Uh, up in canada. Is his name Steve? I remember when he did. Hey guys. Hey, denny linda heather How the hell about the kpi's and profit? Heck yeah Heather that's what we've been talking about for over a month today is I think today is the last day of reducing For double profit for the rest of the year misting Hey, Andrew Yeah to go we'll be pregnant all year long. Yeah, we'll be copy profit for a while. Yeah, absolutely Uh, what hey, sarah. Oh everybody's got their faces on today too Yeah, everybody's here early Hey, anything else going on? I heard um, somebody was talking in one of groups today tom about Um being told to return her or pay off her idol if she paid by today She's anybody know heather sarah. I think you guys know what i'm talking about That if she paid it off today, she wouldn't have to pay Hey Something something something and so she was talking about paying it up paying it off today returning it So reduce whatever Charges or interest fees or whatever she paid her something something good that was going to happen for her today I can't remember what it is. I kind of wish I hadn't brought it up. I'm like, all right What is it like a three and a half percent interest rate for 30 years? Yeah Yeah There's a day coming and I mean we didn't think it's been coming for a while, but I guarantee you It's going to be you know, but between now and the next 30 years three and a half percent interest is gonna look Like all attractive It's gonna look like gold. It's gonna look like somebody's raining money down on us. Yeah, um, but I did hear that Just because you return the money doesn't mean it's not available to you anymore So really that it will still be available to you I'm not sure that that interest rate is going to be available to you, but the funds will are still available to you So I don't know how for some period of time. I guess right. I don't know how long this is gonna last Ran, I'm not gonna last 30 years at three and a half. It's kind of like a credit line and you don't pull it but you know Banks will give you credit lines, but they don't like if you don't use the credit line because they don't make any money So if you don't use it then typically they Tend to not want to keep giving it to you How does that hurt them if they're if you're not using it though? It doesn't hurt them But it doesn't help on they rather give that credit line to somebody who's actually going to borrow the money So I think it makes them interest. Yeah. Oh, okay. I get that. Yeah. Yeah. Hey, Pam. You're gonna be younger than me, Pam I know I was like, I can't believe they're giving me this money Do they not look at how old people are? Yeah, awesome, right? All right, I I just hope that doesn't mean that there's gonna be this Well, I guess I don't care if there is gonna be some big Debt that people are gonna have to pay off when I die. I don't care. That's their problem not mine I'll be gone Well, do we want to do want to get get the show started here? Yeah, let's do it. Oh, yeah Oh, I know that has been just chomping at the bit to return that money. It's been driving her crazy having it Oh, it's just I'm already on it Hmm Our platform here made a change Oh, I figured it out, but I clicked on the button. It did something different than what it's been doing every day Since last march, but that's okay. I can adapt. Good job. Tom. Good job. It's like I did it Times I was like, what's that? All right. We're all good bounce We're all good. It doesn't let me show a video if I want to I gotta play with that don't have a video today though um Okay, red numbers green numbers and it's all about making profit I'm going to go back here and just just revisit this for a second You for every dollar that comes in part of it goes to cover variable cost your cost of goods sold and the other part of it Is what they call gross profit and the gross profit Well next go to cover your operating expenses which are typically fixed and once those are paid Then everything that's left over is profit. This is kind of what it looks like on your p&l So the whole idea behind this is is try to get this cost of goods sold down As a percent to revenue as low as you can Which means more money's flowing down to cover your operating expenses and eventually trickling down to net profit We all got that, right? Yep So he has this at this point anybody not have that anybody want to go over that again? I think we're good though Tom if somebody says something we can we've got our Green numbers and our red numbers if you want to improve profit you make your green numbers go up and your red numbers go down and That's kind of you know common sense so we could get more revenue for every home we cleaned. We're going to be More profitable with We're able to quote more jobs and if we're able to close more of those jobs that we quote and so forth They're all these green numbers the bigger the better All these red numbers the lower the better and for the last few weeks We've been talking about just one number out of all of these which is the loaded direct payroll to revenue Because it's really important because that's Really this number here does cost a good sold for all practical purposes It's that number that loaded direct payroll to revenue is this percentage here So you want that number to be as low as you can get it and still provide the quality and You know meet the scope of work and do the things that you promise your customers You're going to be doing and you promise your your your your cleaning professionals your employees what you're going to do too, so I mean as At some point you get so low that you start breaking commitments and expectations that you're setting with your other stakeholders And you don't want to do that but We've been showing you a bunch of tools here over the last few weeks on how to meet all those Expectations is still lower that number and we are all the way over here on efficiency Just real quick Tom Because over half the people on today or at least that are showing for me are in the MMA groups They just wanted to let you guys know this ldpr. This is the same thing as ppr that that we reference all the time All right. Oh, hey Bridget Good much cat Listen to her scream at me It's okay. Molly Did Molly hear her her her like collared jingling. She looked out. What the heck was that? Hmm. I see that cat All right talking efficiency today. Yay We're kind of wrapping it up. We're almost out of the Loaded direct payroll part of that ratio and we're going to start getting into how to make the revenue number go up here Uh before the day's out. That's our that's our goal. Um So we talked yesterday about what what efficiency is and how it was Come on How it was the actual time that you're in jobs divided by The total time that people are on the clock, which is the job time But it also includes, you know drive time meeting time things like that as well You know come I have to tell you the most interesting thing about The presentation yesterday was that there are three different types of efficiency So I found that really interesting because I hadn't thought of that before I'm like, oh, I love that Yeah, I love this I'm not sure that a lot of people have thought I'm sure that everybody has experienced them all and and dealt with all of them But I'm not sure that or maybe they have maybe I'm the only one that was like, oh my gosh Yeah, there's three types of efficiency that we really need to be measuring and paying attention to and thinking of them all together kind of at the same time along with productivity is a much more effective way of Making more money We are This is this has made central stuff. I guess we we currently have been doing this company efficiency for a long time The team efficiency and the schedule efficiency. We're we're building that out. So that's not even platform today But but all three of those are important for different reasons Company efficiency is the actual job hour divided by the actual clock hour and You know, you need that to like dial in your pay plans um Did we we I think we shared these calculators Yep, day before yesterday for instance um If you want to pay job ticket hour in job ticket hours the same thing is paying a Larger hourly rate for the allowed hours in a job What you need to do is know what is your target? Hourly rate for the time that your technicians are on the clock so that is Getting back to To this over here. That's the entire day not just the time that they're on jobs, but you know also their their drive time What is it that you want them to be making per hour? And if you know what you're Can can you go back to where you show? How much you have to be charging to determine what your target hourly rate is Are you going to do that next because somebody just asked about that again today? How much you have to be Charging are you talking about if you're doing commission? Yeah, so if you want to Pay 15 dollars an hour. What do you need to be charging the the customer? Right? If you want to back into that and I guess It would be if you're paying commission it would be these three numbers here that that that you need to Decide up the line, you know if you're Um Want to be paying $15 an hour for instance? Yes, and if your average bill rate is $50 per labor hour If your efficiency is 75 percent then your Commission rate would be 40 percent If you're like a solo or if you got two people on the average it would be You know 20 per cent per technician, but there's still an aggregate for the team. It would be 40 percent So let me tell you what the question was to me today And you can help me figure out how I could have answered this better. Maybe He charges $43 per hour And he wants to pay $15 For his target hourly pay Like he wanted to know Is that right? Can I do that? Is that the right amount? Is he paying commission? Yeah Okay, and he pays he pays 40 percent and um He earns 43 so he's like And I want to pay 15. So what do I need to what do I need to charge? If he wants if he's paying 40 and he wants him to make $15 an hour With an average bill rate of $43 per labor hour. He needs to get his efficiency up Um Let me let me do this So you almost 90 percent That's not really very sustainable It depends on his model If you have a solo model where people show up at the first house and no No teams at you It's gonna be hard to do with with with the two person team. Yeah So he So there is no real way I thought we had I could have sworn we had a formula that we did day before yesterday where you could Punch in how much your revenue is per hour and Oh, no, how much your target hourly pay rate is and your average efficiency factor And it would tell you what you need to charge for job No, we didn't have something like that Maybe I mean we had the other we had the other sandbox spray sheet We could take that out and look at it But if he's paying if he wants if he wants to to to have a This is just gross payroll by the way not loaded payroll A gross payroll of 40 percent to revenue And if his average bill rates 43 percent, he needs to get an efficiency factor of 88 Which probably isn't practical Maybe he could get it to say 80 In which case he's got to get this bill rate up to you know something closer to 47 dollars an hour, let's say at 47 75. Oh, yeah 47 there we go So the answer the answer to the question is he has to charge more He either has to charge more he has to get his efficiency upper has to pay less To be able to meet that 40 percent and make everything. Okay. This is good. I will give him this little thing to play with Actually, no, I won't I'm gonna are we weren't you gonna post it? Did you post it somewhere? It's done with this because we're gonna be making changes and I didn't want to post it every day Okay, I remember now I get exhausted posting stuff every day. It's just just too just too much much I'm sorry to make you work so hard Tom It is um, I'm looking for the other spreadsheet. Where did it go? Here we go um This was the other one that we were working from. Is this what you were referring to? I don't think so, but yeah, this didn't really have I wanted to do but We were gonna post this too when we're all done But I want to go over to everything again Because it's just gonna take up time and I do want to make sure we get through what we want to get through today But you know, it sounds like it's an interesting question. You're asking Maybe we can talk a little bit more and we'll see what we can build to be more of a direct calculator for that rather than Having to do what they call Uh, what if analysis or sensitivity analysis just plugging in different numbers to get I don't think you'll mind the what if analysis so You know, he's in made central. He'll like this But the point but the point is that the higher your efficiency factor They All things else being equal the lower your Commission rate can be and still pay a competitive wage if you're doing commission Or on job ticket hour. It's really even easier. All you do is just Uh divide whatever your target is by your efficiency factor and it gives you The hourly rate that you charge For against the uh allowed time So if you had a efficiency factor or say now for we If you go to the cleaning business today, tom, you can just search for this performance pay rate calculator. Can't you This is a In cleaning business today. I built this for amar for his maid service success summit Gotcha, and we never I haven't got a kpi video in like forever I was like a young guy when we were doing those, you know, that was a different different Different tom right there different different deal But we can do one with this. Actually, I guess I did for amar, but it's kind of long. It's like 40 minutes Yeah Yeah You were gonna put it into our facebook group, weren't you? We're just going to put this on I was going to upload this in um I know you're getting this in our resources. Yeah Yeah, I can put it wherever we want I mean I do it a lot Okay, I check this out If the bad efficiency factor of like 70 percent I have to pay 21 dollars and 43 cents an hour to to get an equivalent, you know Pay per clock hour of 15 bucks if I can get this up to eight I can drop that down to like 1875. I mean that's material. Um much much different. Yeah. Hey leslie Hey leslie. How are you day? She had a birthday uh last week. You missed it les I hit her up on facebook. You might remember the one that told you you did you are It's I was supposed to scrown jump over those little pointy birthday hats I was like tom, you got a hat put on a birthday hat for leslie. It's her birthday And I'm I'm an idiot. I go what type of hat do I made? I had to I had to get a google picture and and send it over to him Uh 60 see it was the big six. Oh tom. That's why we needed a hat Congratulations leslie Yeah, that was when you were here with matt on thursday Who's name rhymes with crickets? Yes I gotta tell you I got a uh a vox from him today They actually figured out how many employee retention tax credits he was going to be getting and it was an insane amount Oh, wow really? We'll have to get him back on here sometime so he can can talk about that That's awesome Since he's paying 10% They're giving me a little bit it comes out every time he talks about it to he's like a mince over that. Yeah You still get 90% though 90% is still good. All right. So where are we what are we talking about now? Let's talk about scheduling production planning. Okay, how can that affect efficiency? I mean, we all do our scheduling, right? uh, whether you do it with uh You know a desk calendar or some, you know production management software. There's a ton of them out there You're all doing your scheduling. So if efficiency is Taking the entire bar the blue are taking all these yellow bars and dividing them by the yellow and blue bars together If you want to increase your efficiency, basically you want to make the blue part be as small as you can right from a scheduling standpoint Yep So you want to be thinking about? Drive time and and how do you reduce drive time from a scheduling standpoint? It's not all drive time. We talked about a lot of different things yesterday from Making sure your cars are maintained. So you aren't getting flat tires and truly there was a time when We wouldn't like Change the tire as soon as maybe we should don't even get a few more miles out of it but we figured out that you know Tires that have some miles on them tend to go flat more quickly And it's like, you know what? Let's just go ahead and keep you know tires with plenty of tread on them because that's one thing that we don't have to worry about Is that a flat tire and having to roll jobs because it can't get people to a job because their car's on the side of the road Waiting for somebody to come change a tire for them You know, I have time until I met you that was a completely new concept for me I never thought to change a tire Before it went flat or I took it in somewhere and they said oh, what's up with these tires? I was like, oh, is it time to change them? All right, let's change them I didn't know that people changed their tires before there was a problem. Just had never occurred to me And it's not it's not a guarantee. I mean so right over now something like that, but Truly, you know, if you change your your your your tires before they get down to the To the point where it's prescribed to change you Going through I mean that would happen from time to time and part of it is we just want paying attention to it as well as we should But you know, you want to know what the what the estimated drive time is between jobs Um Zoning is Is a kind of a common technique where you might take Zip codes that are all like Contiguous are on the same place and put them in different zones and do your scheduling in a way where you aren't Having teams go between zones during a day Oh Such a grown-up tom every day every day I think he's been grown up since he hit what maybe four three Oh god No, there's something happened along the way. I was kind of the I was kind of the anti tom for for for for a long time Some stories I think about it Oh, yeah, okay the story the stories I could tell you Yes, literally I can remember anyway But well, there's no other stories need to be told. Why you get to anyway um I Leslie says she has a google map with pins on it for each client. This helps us figure out where a client will go Probably and When you're you know, your sales process fits into this as well You know, you want to have a sales process where you're being presumptive and you're guiding Your your your your your new jobs to where you want them on the schedule to make you most efficient Rather than asking them, when do you want to be cleansed? You want to be Suggesting I've got an opening next Tuesday afternoon. That would work really well for you Can I go ahead and and book you there with the idea that we're cleaning your neighbor's house that day? um Even going as far if somebody wants a particular day and it doesn't fit your schedule because there's a lot of drive time offering them a few bucks off if they take another day in another time that Allows you to put that job with something that's already scheduled because you know Giving them five bucks is going to save you You know, uh, you know, if you got somebody it's going to have to look out of a windshield for a half hour And you've got two people in that car. You've lost at least a labor hour if you're paying You know fully loaded 20 bucks an hour giving them five bucks off the job's going to get you like 15 bucks to the good, right? Yep, absolutely absolutely Yeah, I I have a map to Leslie or I used to have a map too and it um, Yeah, it it's it's a a pain to maintain but definitely helpful, right knowing I do love that about made central the calendar that shows every single customer And every single day who's on monday who's on tuesday wednesday thursday where they're all at So that you can see them all on one map and you can move them around I know this isn't a made central call, but when when you guys built that Tom That was like one of my very favorite things ever. Oh, I love that so much. I mean Let's be real, you know, we try really hard I you know, I try really hard not to make this a pitch fest for anything And there's other softwares that that that that do these things as well But you really want to look for technology to help you with As much of this as you can because part of it is you know, this is 2021 for God's sake, right? you know, so if we're still doing this on paper and pencil and desk calendars and I know few of us are but um You just you you you can really just Change your life if if you you raise technology to help you with some of this and you get better outcomes You're going to be you're going to be uh more efficient. You're going to be more productive. You're going to have a lower cost And really there is a cool functionality in maps So even if you even if your scheduling program doesn't help you with this piece There is a very cool functionality in maps where you can Put all of your jobs in And or at least get like your first job in your second your last job in And once you put your other jobs in it'll help you figure out how long it's going to take and it'll tell you You got to move them around yourself and figure that part out But it'll tell it'll give you the information because uh a lot of times What looks like the best the best route is not the best route It it might seem like it is but for efficiency's sake, it's really not Oh my gosh, right leslie. Are you talking about my map? It's so amazing Okay, don't want to recurring revenue is You know an important part to our business for for a lot of reasons but You want to be scheduling your your recurring jobs in a way, especially your recurring jobs in a way that that that are efficient Um, there's some tools. There's a thing that we we use called a master schedule And again, that's a that's a made central thing as well I'm kind of torn. I could actually pull up a demo made central and sow some of this or is that maybe for another day Um, actually that might actually be helpful for schedule and production planning And that's not just a made central thing Almost everybody I know uses some version of that tom. So I think that would be helpful I mean made central just shows it in the scheduling program, but Almost everybody does some some version I think there's a lot more there are a lot more tools And made central that are better than that one But I know that that's the one that almost everybody does uses so which apps did you say? made central Yeah, it's not an app It is a scheduling program Amelia, but yeah, it's called made central This is all test data. So I'm assuming this is uh Set up correctly Just ignore everything you guys because everything looks so overwhelming if you're not familiar with the new software program He's going to get us to the right thing here. Oh, you're going to show the map Oh Yeah, that's what I was saying travis google my maps is good. It really can help you figure out exactly how long it takes between So travis, what are you doing on here? What are you doing on this thing? You have free time, dude I know you got better things to be doing right now So one of the things that you would want to do is just to go ahead and create zones where You know each one of these color each color represents a different zone So you just got you know schedule based on colors and You know we've been doing this since the mid 90s And when we first started doing this we did this with magnet boards and the little one by two inch magnets and Each zone had a different color paper and that was how we kind of matched them up Actually, that's not completely true We had weeklies with one color we had every other week a different color and monthly is a different color And they were like little pressure sensitive stickers that had different colors that we would put on them to to get the zones, right? And then we had the allowed time written on them It was it was a very intricate thing I know i've seen the boards. I have I have um this is an example of how push pins can help and Each team this has their you know The their drive times and if you keep the push pins together by team like these green pins here are all This team and these orange pins are all down here on this team And just using some graphical representation where if you've got green pins all over the place You like so we can see they're too close together right now too bunchy Oh Thanks Just pick one. I don't care. Yeah Here's a here's a game here. And if uh You had the green pins all over the place next to other colored pins. You'd start moving the jobs around so Uh between you know changing jobs between teams to get all the colors together and that's going to be reducing your drive time If you want to use google maps you can use that into some softwares That will do that where it'll actually calculate the distance and they uh the drive time between jobs and leave it and give you Alternate ways of arranging the jobs between teams to get a get a turn even alternate. Tom. It gives you the best Right. Oh the the yellow. I love I used to love this too. You use it every day Um, I would set up the teams the way I thought they should be set up and then check them And the yellow tells you the the most efficient way and I really love too That you see up there at the top where it says efficiency. It actually shows you the efficiency for for this I love that But these are just some of the tools that are that that are out there and Just just to be aware that you're saying, well gee, how do I keep up with all of that? Well There are there are tools that that that certainly help um This is really something that that we call this a master schedule and You know, I understand that um Yeah, Kathy gauge kind of figured this out with a spreadsheet a long time ago And this is one of the more more brilliant things that I've seen for each um team we're able to Show all four weeks across here, and I'm if we can see that or not Like this is team number one And this is on a monday This is week one and three is together and week two and four is together and the reason that is Is if i'm an every other week customer I'm either gonna as a default be I cleaned on weeks one and three or weeks two and four So it makes it really easy by putting weeks one and three and two to four together in this view to see Where are the halls that I can put like an every other week customer or an every four week customer And scheduling at every every four week customer is a little bit easier because all you're looking for is a hall But finding a cool place to put that every other week customer that every week customer Where you're going to have the same team on the same day at the same time For them it's kind of tough and this really makes you makes it easier to do that And you're looking for a color that matches the color Associated with the home that you're you're looking to schedule because that needs to end the same zone Like this is monday. This is tuesday. This is wednesday And there are actually our quoting tools. There's tools in this software that You can plug in an address and it'll show you actually this map over here We'll do that Don't have the ability to plug in an address here somewhere And that'll show you where it's at Yeah, and which house is its closest closest to in relationship to to the other Ones that are scheduled. Yeah anyhow um These are these are some of the tools that are out there that will help with the whole efficiency thing Nobody makes money looking out of a windshield folks, you know, it'd probably be helpful tom if you could show like um Pull up make central again and show how if what a difference it can make to put the homes in the right order because That that is just really important These are already kind of kind of staged up that way because this is kind of Changing around Yeah Uh, we don't have time to do that Okay We got we got some other things to cover and we saw the time when we wanted to we could do a deep dive on some of this But I mean we get the point right Guys if you get your house is in the right order and the efficiency is good You're just making a 10 more money And it's easy to see how even just putting one house in the wrong place can make A huge difference to your bottom line. So you really got to make sure that they're on the right day But also in the right time slot Which is tricky if you guys are like me and you have those customers that are like, don't come before nine o'clock You have to be out by two o'clock Don't come between one and three because my baby takes out right all of those things But it is important to to to do it. Anyway, I have somebody that's doing your scheduling that is That enjoys that part of the job if your scheduling person doesn't enjoy the job They're not going to do a good job because they won't they'll just be frustrated by it They'll be frustrated by how it can't work and how all the customers are so demanding and You know blah blah blah blah and I guess we'll been there But the right kind of person loves that they see it as a puzzle and they think it's fun It's like a game trying to figure it out how to make the best efficiency number and all that good stuff What you're building here for us, huh? Let's pretend Uh, I don't have time to build this out either. I'm just going to show You know like having On this example over here. We had you know Drive time Yeah, anybody that's gone down that that drive time efficiency Um route leslie Can attest to how much difference it makes in in your profit? It's huge Uh, I know, uh, I think it's chris will it that does this exercise um, maybe twice a year he just goes through and he um He just uh, what what does he call it? Care remember I'll remember in a minute though He just goes in and he fixes He optimizes he optimizes the the Entire all of his jobs. He optimizes the calendar basically And always pulls a ton of money out of it He does that with my attention Um Yeah, but I mean I used to do it when I didn't have main central. It's a lot bigger job, of course, but it It's something that needs to be done You need to be optimizing your schedule because it does make a huge difference Which again remember we're we're that's what we're talking about here is how to reduce that That direct flavor to um our revenue, right? All right, why you're you know efficiency is 75 percent if you're cleaning for six hours and Two more hours of non-productive clock time but if something happens and say Maybe maybe you wind up Like with some type of job that that you're having to go way out of your way And this number Changes to nine because you're having to drive like an extra hour and your whole Efficiency goes all the way down to like 67 percent and One way or another You're paying for that drive time. You're either paying for that drive time and in hard cash or you're paying for it out of What your cleaning technicians are getting a A definition and pay in terms of their revenue per hour And if that happens on a regular basis, nobody's gonna want to work for you But the people that are going to be working for you aren't going to be The people that you would most prefer working for you, right? um So that's really hard and that gets back into the whole thing of Employee retention and if you're going to have turnover How many people are you going to be training? So the real cost the real cost of this is so much broader than This little scenario and saying, okay. Well, fine. I'm having to pay Um, you know for an extra hour, but it's for an extra hour between two people So it's really two labor hours and if you're doing $15 an hour fully loaded, you're probably pushing 20 So that hard cost might be 40 bucks But you know People are getting home late not able to get their kids, you know have a daycare all of that I mean all of that kind of kind of adds up to Is there anything more that we want to say about efficiency? um, I Don't think there is anybody else have anything that they They don't understand about efficiency or how to Anything about efficiency that you would like to talk more about Drop us a comment Otherwise, I I think we can probably move on from that Tom because You know the other things that we have left here like performance pay expectations of accountability and that's kind of a A rehash of the same things that we had under productivity. It's kind of the same deal um You know a set of a set of pay plan be it um any one of You took off split hourly Tom what we're gonna do with that I'm gonna I'm gonna add that back actually I'm gonna take and say just one thing about that. Okay um split hourly is a pay plan that actually does help with efficiency And what that is is say, maybe you pay $15 per hour when the teams actually on a job cleaning a house and You know actually uh checked into a job and When they're between jobs, maybe you pay I don't know $9 an hour so That creates an incentive to you know not spend a lot of time between jobs, right? so that uh that that split hourly is a way of Making that happen Also to get people that want to drive because people don't want to be Not driving Because they're making less money. Right. So it's also encouraging people for that In commission and job ticket hour all of that, you know even bonus all of that will not only Create an incentive for people to be more productive Getting their their cleaning times up relative to the allowed time But it also creates an incentive to use your time wisely between jobs the efficiency see And You have to set the expectation in terms of You know not only you know, this is what we're looking for from a productivity standpoint But this is what we're looking for from a team efficiency standpoint. This is you know According to google you've got about you know an hour and 20 minutes of drive time today so You should like be able to clean all these homes weekly uh scope of work Meet our quality standards and be back here at the office by You know 415 So you're setting the expectations so they know if they aren't doing that then Probably some type right and there's probably going to be some accountability Ideally ideally that would be the that would be the plan. Yeah Nobody's want to hear anything more about Efficiency, so I think we're good so I'm gonna rewind back to this because we're still talking about loaded direct Payroll to revenue But if we want to get that down we can do that by one of two ways we can make The number on the top of this equation go down loaded direct payroll and that's what we've been talking about here over the last Couple of weeks I guess It's all But let's talk about the other thing that we can do we can make the revenue go up If we make the revenue go up without affecting the loaded direct payroll We're making the loaded direct payroll to revenue go down. Does that does that make sense? Yeah, absolutely. I also just want to point out that if you are just a reminder And we have some new people on here, too That the reason why we're talking about this portion Is because this is where you can make the biggest impact on profit. Remember we're talking about profit So the the biggest impact and the fastest impact typically is to attack this number the ldpr Right this this this piece so First thing to focus on is lowering That loaded direct payroll and we gave you a lot of bullet points around that A ton of different things that you can do to reduce that and now they Got enough nice little green number that we're gonna focus on and now we're gonna give you some things You can do to get this number up Yeah, all right cool because the truth be known and you know We've all fallen into this this hall where we're looking at the schedule and you know It's that constant balance of i've got I've got jobs. I don't have people clean them or I've got I've got cleaning professionals and I don't have enough jobs And you always have too much of something and not enough of something else You kind of get caught in that trap where You know, how many how many technicians do I have how many homes do I have and you know, it's the schedule right today You know, who's not coming to work today. Who's not and and our focus is just on cleaning homes And I mean this that's rational right we got clean homes but We don't spend a lot of time Worrying about well, what is our cost associated with cleaning those homes or how much revenue are we generating? When we clean those homes, that's almost the daft we thought right? Yep. It's a thought at all That's not the crap that we lose sleep about right? Yeah, you know, it's like What if you look at about You dread going to work you you dread like when the phone rings you dread You know, it's like god, you know, it's gonna be it's gonna be a mess. I just know it is And I don't I don't even know how i'm gonna make it through the day You ever have one of those days less I can remember that. Yeah, absolutely. Are you kidding me? Yes um and it wasn't because of My direct payroll is going to be too high, right? No No That's why we're talking about this because if we can get this right We're more profitable We can afford to fix the problem If we were profitable, we at least have The raw material we need to start fixing those problems where It's not, you know, when the alarm goes off. It's not a dreaded thing Let's talk about rate increases um I think that we would all agree that it would be a pretty good practice to do like Regular rate increases for our regular recurring clients Yep Nobody would argue that point anybody wants to anybody doesn't agree with that go ahead and chime in with the with with with the chat As well as taking a look at what are Hold on. I gotta speak for the masses over here, tom so I Well, I don't think that anybody would argue the logic Of raising prices on a regular basis. I think that some people would say yeah, but And then they would have a lot of answers to that Like yeah, but not everybody's going to pay and I need my customers I can't afford to have anybody drop. So I'd rather Not do price increases because they can't afford to lose customers. That's one I think people would say yeah, but during COVID You know people are are not going to pay us more. They're already strapped. They're already like tight tight on money I think they would say yeah, but I'm already like the highest paid Company in the area. I can't raise my prices. So I think that while nobody would say they Would argue the point that We should raise our prices on a regular basis I think there are a lot of objections to that and I think there are a lot of arguments against it Okay, I would Nobody wants to lose a customer. I mean at the end of the day What are the reasons what are the reasons that we wouldn't raise our rates? One of it is I'm afraid I'm gonna lose customers, right? I think that's probably the first one I would say that's the second one. I would say the first one is It's a lot of work and I'm busy dealing with a lot of firefighting and I'll get to it tomorrow and tomorrow never comes I argue with that Okay, guys. We need a vote here. Yeah, I would like to hear that A lot of people don't do it because they hate doing it Okay, you think that tom is right that more people don't do price increases because they hate doing it That's number one I mean, that's tom say tom and if you think i'm right that people don't do it because they think They can't afford to do it. People are gonna drop. They're gonna lose customers Then type liz in the comment box All right, and then while you guys are doing that. I'm counting on you guys Leslie travis amelia Denet remember who else was up there? Bridget. I know is up there somewhere Thanks And because every time tom and I do one of these I win every time Give me like the uh Yes, I'm always right. Yeah, that's right. Okay. Let's see. What does robin say while they're voting over here What are you talking about? You know using minimum wage as A way of rationalizing with your clients why it's necessary Tom, I just want you to look over here. Yeah, I see I say one more one more. Yeah I don't listen why people don't know what he's talking about Because I mean it is it is Hard to do you're right about that tom, but really the part of what makes it so hard is You know, it's scary too on top of everything else and you might lose out on the You might lose customers and then you're going to do all that work and you're going to lose customers and Yeah I'm I'm sorry, tom That's okay I'm good I'll I'll I'll get over it. Yeah, it's all right We both know I I love to throw them out there y'all because Tom is just he's unique individual And he thinks other people are going to be like him and they're just not Okay So let's say I I love that we're going to talk about the high minimum wage. This is such a big thing right now Just if we can throw in there to tom about the new Um, I don't know if we can do it today. We probably don't have time But I would like to talk about how a lot of the areas Are just now getting the mandatory sick sick pay I know a lot of parts of the country have had it for a few years But some parts are just getting it and it's really stressful When we are full I raise prices with confidence when we have holes in the schedule. I tend to put it up It's just scary. You nobody wants to lose revenue. I know But the only time that changes is when your company is large enough that You know, if you lose some clients, it's not It's not as big of a deal and or and or You're not directly involved in that part of the business If you're not directly in it makes it a lot easier to just have other people do it All right, what we got going on here tom. I'm I'm intrigued Okay, so pretend your average bill rate per job is 150 dollars and This is for like recurring clients and your average recurring client gets cleaned two times per month And you've got a hundred recurring clients That's 30 000 dollars a month. Okay. Does that seem right? That seems about right Teacher that ended dollars for me. Tom. I have a hard time seeing all those zeros. It's so little Oh, thank you And this would be a dollar here Let me see if I can make this bigger Thank you So say if I want to do a rate increase And Do we probably good thing here to talk about the difference between a rate increase and a rate adjustment We're talking rate increases. Liz explain to what the difference is All right, if I do that right now, then we're probably not going to talk about anything else Okay, so maybe I talk about that tomorrow short. Well monday short story rate increases what you do on a For for for most of it's an annual base. This is kind of a cost to living thing So you might be talking three percent five percent something like that. Nothing crazy If you screw up a quote and you have to double somebody's, you know rate, that's uh, not a rate increase That's a rate adjustment. That's a whole nother discussion But get new flooring that kind of stuff What do you want to do across the board increase of five percent? So if you did that your new monthly uh revenue Would be This number here times One plus this What do I do? I'm losing my mind Okay, I give us that's a bummer man But I'm gonna do a rating increase because you'll have no revenue Okay. Oh, there we go but let's uh pretend that You're going to have some amount of attrition if you No, maybe maybe you lose Five percent of your customers, right? Do you think you lose five percent of your customers or you raise them all across the board? I don't know. Let's look at it another way the delta of the increase is this number minus this number And if I take this by the Number you can lose to break even That would be this number divided by your old bill rate of this That would be 10 So all things being equal Would you rather claim a hundred All or you know It's 10 Yeah All things being equal would you rather have a hundred clients And get 30 000 dollars or 90 clients and get 30 000 dollars So i'm going to say that most people know that logically it makes more sense to have 90 clients and make that amount of money But then there's always this other argument. You know, I'd really rather have more clients because You know, I want to be able to keep my people busy I think that a lot of times what happens with entrepreneurs is they there's always this This thing going back and forth. So No, but I need to be able to keep my people busy. I can't afford to lose 10 clients Yeah, 90 is the logical answer, right? We all know it's less expense we're gonna Remind There's a hidden cost associated with with with a client That's more stuff that you can break. That's more Stuff that something can happen that somebody's going to sue somebody. That's more potential for Just all the bad things that can happen and they don't happen a lot But when they happen it just really sucks The the same amount of revenue with the fewer number of clients It's just fewer invoices less scheduling headaches Less overhead in the office. I could go on and on and on and on You're gonna be more profitable Making $30,000 a month or generating revenue of $30,000 a month with 90 clients Then what you would be with a hundred clients. You're going to be more profitable with the 90 right Yep, Amelia, you're right. You can replace the 10 with your new higher rate Right. So now you're making even more money. Now. You're not really making just 30 grand now. You're making more So so so it's pointed this is and then we're going to have to go Um Is you're not going to lose 10 customers out 100 you won't you're going to lose a couple And there's a lot of techniques that go into the whole discussion We're going to pick that up on monday and we're going to show you graphs in terms of How basically you're going to go broke over time if you don't do this and how much money you could make We got to go but we're going to show you how not to lose any So few that you can't even believe it. It's free money basically and you're going to want to do this You're going to be excited about doing it. You're not going to drive it. You're going to be excited about it And you know that you might lose a couple and you're still going to be more profitable Have an awesome weekend. We will see you monday. Bye. Bye