 Hi, good afternoon everybody Tom Stewart here. I'm with Liz Trotter. Hey Liz Hey And we've got a really special guest who's got the inside track on some of the big changes It's taking place with PPP over the last week Matt Ricketts. Hey Matt. How are you? Hey good Tom? Thanks for having me Yeah, man. Thank you for for helping us You know I chatted with Matt some here over the last day or so and he spent a lot of time researching this met with his CPA and got a we're fairly intense Tutorial on you know what these changes mean and it sounds like there's a lot of a lot of Good news for us Yeah, do you want to share a little bit Matt about what you learn? Yeah, so my bank is Midwest Bank Center out of St. Louis and they hosted But they've been my banks been really great they've been hosting like a series of weekly events kind of keeping us appraised and I've made about four of them out of the last, you know, ten weeks So I you know, I haven't been able to make all of them But all of them been really informative and they've had good expertise so we we dived into the the PPP and A lot of the changes so one of the big changes obviously is you know that they they change it from an eight week to a 24-week window basically so the 24-week window basically pushes you right up to December 31st Versus the eight-week window, which was from the from the start of your money either way I believe that the 24-week window kind of ends at the end of the year like And your your 24-week window could be a little bit before that but they're not they're they're not taking any more Applications for PPP after June 30th. So if you have not applied yet you only have two and a half more weeks or so to get an application in so if you have not applied yet I Strongly suggest that you do so because Almost all the money is forgivable and we're gonna kind of go through a couple scenarios where that where that kind of where that kind of plays out, but This is a great opportunity to put yourself in a strong financial position moving forward and You know, that's that's a it's a no-brainer as far as the way that they restructured this goes so we all knew we had these eight weeks and we we got our money and Some of us we were doing, you know, probably paying bonuses or doing other things to kind of get the wheels back on and You know, some people are paying their grandma and their aunts and uncles to come work for them and all sorts of crazy stuff We all kind of got scooped up in this, you know, this moment of like, how do we spend all this money? Couple things that I was worried about all along was was that hey I was only paying my people 80% because I had for the first few weeks I had them on job share because I was trying to be logical with the money and trying to make it last So I knew I was gonna have a bunch of this money left over and I don't have a ton of overhead So I was gonna have to return the money and pay, you know, the 1% interest on Probably by the time I paid him back 120 days or so. So not a whole lot of money That I would have had that would have cost me to do that, but But now we all know that that's not the case So I have a little over three and a half weeks left of payroll even after my weeks is up because we were Kind of conservative not as conservative as our friend Joe Walsh. I'll give him a plug if he's listening Joe tried to talk us into doing some things his way and his way is looking pretty intelligent right now of just being, you know believing that there would be changes and some Some restructuring of this Joe Joe has like always cautioned Lowdown through this whole process If you guys know Joe Joe is a thinker and he he deliberates before he does things where I'm more of like, let's get this done Let's do this, you know, and Joe Wasn't just thinking it was gonna change. I mean he was actively trying participating making it change I mean it gave me some great Copy for you know sending out press releases to our local press I got you know a lot of press in our local newspaper as well And I think that whole snowball Joe was like a driving force of getting that out to a lot of business owners And you know, I took his I took his format and I was able to to generate To press interviews and he was I mean he was quoted in CNN Wall Street Journal I believe several local newspapers that I'm not that I don't know the names of He got the ear senator Collins office and she was one of the sponsors of the original bill and convinced You know her staff basically who managed the details of these things that they needed to make a change and you know I think that that I mean was was a real contributing factor to leading towards this change. So You weren't he worked hard. We we owe him. We all owe him a debt of Joe, I think Joe was pretty instrumental in this and like, you know, we'll all have our we'll all have our moments of You know what we're good at, but I think Joe really showed what he's really good at is this grassroots organization and leadership through this process so Anyway, so we you know people like Joe got this to change so we know that it went to eight weeks to 24 So here's the here's the deal you can still use the eight-week window and there there might be some reason to for some Businesses to do the eight-week window. Let's say you had you had higher rent costs and things like that or whatever it's the the the eight-week window might make sense if you spent almost all the money so far and You've you've done it a logical way You haven't had any employee reductions and it's kind of like the devil, you know, right like because the rules could change again So for some businessers if you have basically met all of the spend and done everything at this point Your eight-week window might be what you want to use Because it's either it's either or it's either an eight-week window or take the full 24 And we obviously know that we don't know anything anymore like the whole year could change again We can have down. I mean anything could change between now Criterion and spent your money within the eight-week window You could go ahead and do your application now. What were you asking this? And I just wanted to say that you're you're right Matt. We don't know anything because why come Unprecedented event Minutes or so Really how many times has that have things changed? So just having Having the mindset that okay, this is the way it is and it's not going to change just seems like something Joe wouldn't do I'm like, okay, Joe would have us think logically that things could change and make your best decision today But I thought you have a smaller subset of businesses that are able to to do the eight weeks and have spent all of the money down Because one thing that I think and I've mentioned this before is one thing you have to consider is as you've been spending money You have been accumulating Some unforgivable portion of that money through payroll taxes So your your FICA your federal payroll taxes are not for your little bit the employee portion that you know It's coming out of their check, you know, obviously they paid that out of their check But you know, it kind of came out of PPP money because it's from total payroll. So None of that is forgivable just just remember that so you've actually been creating a liability That you're gonna have to pay back on the PPP anyway But now we can avoid all of that if you really, you know Here's the scenario that I'd like you to think about is is let's say you use the full 24 weeks Which takes you about, you know, it takes you through whatever you've been doing so far Plus really almost all the way to the end of the year There's gonna be no clean breaks You're not gonna be able to break out of 941 and be like this is exactly what I spent But you'll pull out your reports from your from your payroll processor and you'll get you'll get the numbers and just imagine this Let's say you get back to 75% for the year and you've had a head count reduction of 25% Well, now you're not really worried about that that head count reduction I'm gonna use I'm gonna use the number $250,000 as your loan because it's just a nice round number and you're normally would spend You normally would spend, you know a million dollars a year in payroll So over this period you would probably normally expect to spend about 750,000. Well, even if you only got up to Like 600,000 in payroll for this whole period and you still had to take a 25% reduction You're still what is that? That's like 475,000 roughly that would be forgivable and you only had a 250,000 dollar loan Even if you only got up to 50% of your of your head count and all through this period You only spent 500,000 on payroll through the rest of the year Again, you you hit your 50% just in payroll However, now you didn't probably cover your your tax liability of that portion So, you know 50% probably doesn't quite hit the number you want But some number above that plus 20% gets you gets you pretty close It's pretty hard to miss the forgiveness, but I don't want to get too complex But just imagine what your payroll is per week multiplied out by 24 and let's say you're at You know, you're at 100% now But you plan on dropping back down a little bit because you didn't get fully staffed back up You know and you drop down to 80% you might still average 90% headcount for the year And you know all of that all of that is gonna still lend to the to the unless there's another shutdown or anything else that like drives You know a big change in the market in the next few weeks few few months We're gonna all be able to hit that forgiveness full forgiveness of all the money that was lent to us and Be able to probably get it squeeze out a few more payrolls covered through this loan And I think that's a I think that's a big advantage If I just as a question is there are there lots of people in here listening today that still have That still have some payrolls that they probably have left in their PPP funds Anybody I Don't know if they're responding here though. They probably will respond. I'm sure that there are quite a few people I know of quite a few people that are got their monies late, etc. Diane says yes She is a couple other questions here to Matt. I was wondering if now would be a good time for you to answer While we're waiting for for some feedback on your question. I see Russian Yeah, can we apply for more and no, that's it's a one-time deal Wouldn't it be great right like to get back into this bucket? This is an unprecedented event that the government just threw money into our into our businesses. I mean I've been in business for 12 years. I never have asked the banks for money except for car loans and things like that I'm just secured debt. I've never been given unsecured debt for a cleaning company before This is this is wild to to basically get 1% interest and and and honestly You know, we're gonna We're gonna we're gonna be running negative for this period Like if you look at if you know if I look at my profit and loss through this period We lost money, you know in general, but the the the general bank balance at the end of this is gonna be up Significantly and that gives us a nice war chest for when this is over in case there is anything else And it gives us an opportunity to reinvest in our businesses, which is what they want us to do and grow the economy So I'm looking at, you know, some reinvestments. I'm gonna wait Till I'm fairly confident that I don't need that money anymore But there are some investment opportunities We should all be thinking about like whether it's you know operations or you know other other opportunities To make our businesses run smoother. It doesn't an investment doesn't necessarily mean buying stocks, which I don't think is The way that I invest I generally invest in property or invest in you know making my business make more money I said have money in the stock market, but that's not what you can generally do with the money You've been lent. However, you could spend the money you've been lent and then as you're operating accounts grow back up You could invest those monies because they're they're different. They're different monies at that point But you should be thinking about you know ways to grow your business and come out on the other side of this with with more Capital and more resources than you had prior except we're all probably struggling for employees for a few more weeks So I guess just for the forgiveness part just to kind of recap that we've got a month if we need it we've got a much longer time to And spend the PP P monies on the things that it's supposed to be spent on in 24 weeks We should be able to spend it all on payroll. Yeah, it's either or so you either have to use the eight weeks You can't just use any eight week period It's the eight weeks from the you know the original rules or or you go from the 24 week rule So it's just one or the other if you don't do if you don't spend your money in the eight I'm saying like you want to take the 24 How does the the full employment part of this Figure into it though because there was I guess the June 30th day was Something that It's December 31st now is gonna be your is gonna be kind of your your look back window now So if you don't use that June 30th date then then your other window is gonna be So what happens at December 31st? What's the what's the expectation at that point? I mean, that's what they're gonna. I want full forgiveness. What do I have to have in place on December 31st? Well, I mean, you know, it's not even gonna be percentage base, but like if you First is way past the 24 week window for most of us. Yeah We're what what do we? 26 27 28 29 weeks away from December 31st right now Right cuz that's from the end of that's from July 1st basically is the 20 the 24 week runs from July 1st to the end of the Year basically so it's it's a start I mean it's not just a continuation of say I got my ppp money May 1st. It's not just It's basically it's basically a new window right after the June 30th window Everything I've done if I'm with the 24 weeks everything I've done now basically doesn't count You would count this all towards your number you you could You everything you've done till now counts towards your number and your 24 weeks does start from your from your loan period But the look back window is December 31st So so it's the look just like there was that that June 30th look back window that was probably after your eight weeks Depending on when you got your money the the look back window now is December 31st I have to go through the crazy calculation, right? But okay, so do it quarter by quarter Let's say you get up to 80% employment this quarter and you spent 80% payroll wages Let's say you did have a quarter where you drop down to 50% things get bad again And then you try and then you get back up, you know to 75% you still average 60% It would still be really hard over the course of 24 weeks even at 60% of payroll Not to hit not to hit 100% forgiveness so the real trick is not to fall below 50% employment That's really the that's really gonna be your danger point now is 50% employment 50% employment as part of the new the new law. No, it's just that's that's what it's gonna You know for most people that's Line kind of draws where where you're below what you've needed to spend versus your loan Because it's still tiered. It's still based on I guess I'm thinking about full-time equivalence that calculates full-time equivalence too it's kind of it's kind of both to me because Your full-time equivalence is still affects how much percentage that they're gonna give you forgiveness on so If you do like and it's tiered, so let's say you had 75% of your employees You're only gonna get 75% of your loan forgiven But let's say it's a million dollars that you spent on payroll now And you get 75% of that forgiven. Well, that's 750 thousand dollars forgivable on a 250 thousand dollar loan Not a bad not a bad deal, right? Like you it's all forgivable Even though you didn't really get that in a loan, so it really ratchets up What is the forgivable portion? So we're not having to really worry about rent payments and and utilities I got a clarity on utilities and things like that with the conversation of people are still trying to do the eight weeks There was it's funny is like they didn't list trash service They didn't list they didn't list a lot of a lot of stuff So like they had they had water, but they didn't have sewer with I guess the expectation is that a lot of places Your water and sewer bill are on the same bill, but that's not the way it is in st. Louis So there was some very specific things that there's still not guidance on on things that are for on that are Forgivable, but I'm telling you I think that the payroll portion alone would make it really hard if you use the 24 week window And you get above 50 60% employment for the entire for the entire period It would be really hard. I mean I break out a calculator and get it I mean we can run some examples, but I don't see that being you know too hard to do go ahead please Okay, so I have a couple of questions So does the December 30th date does that throw out the or is December 31st? Does that throw out the June 30th date or can you still use that day if you choose nope? June 30th is only if you're gonna use the eight week window And I suggest if anyone has a dollar left in their PPP accounts Still keep using that money and then also just remember You've probably you probably have spent 20% of money of the money that you've already gone through that's not forgivable Anyway, not even intentionally just because of the taxes and things like that So even if you let's say you had a hundred thousand dollar loan you paid payroll for these eight weeks There's probably 20,000 you were gonna be on the hook for I was certain I was gonna be on the hook for about 32,000 dollars As well as what I kind of figured out you know week by week on my on my taxes so far and And now I'm gonna be able to spend past that point. So That's gonna that's gonna be that's gonna be something to consider is the June 30th doesn't matter anymore It's just it's it's irrelevant at this point All right, so then what I'm hearing is nothing's going to be forgiven Technically until next year because they we're not gonna have the number from December 31st to be able to Decide whether or not it's forgiven how much etc. So We're gonna answer the forgiveness amount until 2021 that's the dangerous part So if you have spent all your money, that's why I started kind of you know Prefacing the beginning of the conversation was if you have spent all your money and you're comfortable just doing it now You could do your forgiveness now and be done with this But I suggest really looking carefully at that because that's only gonna be a small subset of people that that benefits the most Okay, I also have another question Kim Jones wants to know Did you hear Matt? Is it going to be taxed as income next year is our PPP money going to be taxes income It was never in taxes income Tom has a good good understanding of this Tom kind of described We've had some side conversations not income, but it's but you're gonna theoretically you're generating revenue without cost A good soul So you're going to be more profitable than what you would have been without the PPP funds And you're gonna have to pay taxes on the profit as you would under, you know any year any circumstance. Yeah There is something else It's not it's not income in the traditional sense, but there was an IRS ruling on that I'll go back to I'll try and do some reading and and come up with a note on that There is something unique to that Joe would Joe would probably know if Joe's listening put in the notes He's probably busy today What was the next question? There's a lot of questions Yeah, so so Paula is asking about the She's only used enough of her stuff for four weeks can choose it in ten instead of eight I think yes, absolutely, but then she came back that that she now has 24 weeks Yeah, but then her question Was Oh, no, this was another person. I'm sorry. So Diane is saying that hers was supposed to end this week But she has two more weeks. Yeah Is it she could pay to finish up? So you're saying if she goes past the eight weeks I have to use it in 24 weeks now, right? Yeah, so basically But you really have you really have more if you count the taxes you've paid until like that You really have more than two weeks because you should be reimbursing that that tax money back into it What I think sorry, I just shook my little computer stand here. What I suggest doing is this I I segregated my PPP money into a separate bank account That just basically to keep this keep track of us and I was going to just kill that account at the end of this Period and call it good. Well, now I'm just gonna have it be my payroll. I'm just gonna have it be my payroll account For the rest of the year so so all I'm gonna do is pay payroll and payroll related expenses out of that count and that's it and So what I'm gonna do is basically fund that every week for payroll out of my operations account I'll transfer money in through the rest of the year and Then you have a matching bank account For when you pull your reporting But but just keep running payroll through the rest of year all of that payroll is technically forgivable against the PPP not necessarily the money that you have The dollars you spend to keep the economy going for the rest of the year are technically forgivable even though you only have so much I wish that they would do the tax credits too, but I think this change in the PPP might stop that from happening Yeah, double double dipping kind of so what we did was We Paid out of our payroll account, but we also put money in so we put our PPP money in We spent our payroll and then we added money to cover our FICA, etc. So we actually The money that when that money is gone the money really is all of all of my money being gone That's a good practice so Kyle Walker and I kind of had a discussion and he's been doing that all along too I've just been staying on the reporting on top of it. I had planned to make a transfer in Now towards the end of this all I'm gonna do is basically when I run my payroll and get my get the amount of cash that I need I'll run that on me on Monday to get my cash requirements. I'll put that money from operations into my into my into my bank account for payroll and Just keep that rolling by the time you're done Expense if you will that would qualify as a PPP Expense is going to be much larger than the PPP FNG guy. So I Mean, so especially if you take the 24 weeks the bank might come back and say well G I don't know if we can give you credit for that. We'll find throw it out. I'm still You know All those tic-tac-tis things that we were looking for to like make sure that those expenses were covered Unless you're gonna use the eight-week window I wouldn't even worry about it the other thing that they did do which doesn't really apply to our kinds of businesses as much as Is they dropped the amount of non payroll expenses down from 75 percent to 60 percent? But that's a hard number if you go if you go below 60 percent None of your loan is forgivable zero like that's a that's a hard. That's a hard floor So there's no adjustment big different. Yeah Yeah, oh so for restaurants and things like that You know where they might have some more higher fixed costs, you know things like that that that's that's fine But they can only count 60 percent of it towards that and if they burnt up all their money on fixed costs Because and they didn't bring people back. They're gonna be in trouble on this deal. So just remember that Yeah You know Idol too. Oh, sorry. Go ahead Tom Back to the 60 percent. This was a letter that the Treasury secretary Venetian sent out in concert with the SBA Administrator I think this came out yesterday and they address the 60% thing and they wanted it a little funny Let's take a look at that just for a minute because it's important lower the requirements They lower the requirements that say five percent of the borrowers loans proceeds must be used for payroll And that 75% of the loan forgiveness must have been spent on payroll costs during the 24 week Forgiveness period 60% for each of these requirements So I think from 75 to 60 if a borrower uses less than 60% of the loan amount for During the forgiveness period Then the borrower will continue to be eligible for loan forgiveness subject to at least 60% of the loan forgiveness amount that has been used for payroll costs, so even if you only spent 50% PPP money on payroll You can still Get some money forgiven. Basically, they'll you know, they won't forgive all of it, but Well, the now the non payroll stuff won't be forgiven though. That's the problem So if you did spend a bunch of money above that 60 percent, that's where I guess where I'm not clear on is And I don't think that really applies to our kinds of businesses if you if you have that high of fixed costs in our Business, you probably have Yeah, you should you especially Because you should be able to spend all this money on payroll. Yeah, I would think it would be very I mean I run really lean and I know that you know I know that my operating costs as far as a function of like, you know, my fixed costs compared to you know compared to my variable costs are Maybe five percent. I mean I would I would struggle to find that I mean our rent is you know 1500 on on a business that does, you know $180,000 a month, you know pre-covid. I mean that what is that? That's like not even 1% just towards rent and I know that And I and I know that you know, we don't have anything glamorous, you know to show for that is just you know It's a you know small office and we we run kind of remote We've got a lot of overhead in our business and we couldn't come close to spending 25% of it on overhead Yeah, you have a different you have a different model where you have, you know Several different businesses running out of one roof too, and there's just no there's just no way to do that I mean you've got four businesses at least running out of one roof and It's still not even it's probably still not even possible even sharing that or delegating all that expense to one business It's probably impossible Here's just a quick You know continuation of the question about paying taxes on the PPP money What it comes down to is you're going to pay taxes on your profit and because in this example You had a $200 dollar PPP long and the presumption is that was forgiven then You know, you say you had a marginal tax rate of 30% then you're paying an extra $60,000 in taxes. You're not really paying taxes on the PPP loan But if these two hundred thousand dollars went to cover payroll that normally would be an expense then you made $200,000 more this year than what you would have otherwise So you're gonna have to pay money on the tax you made and if you use these PPP funds correctly Then you're gonna be paying you're gonna make more money hence you're gonna be paying more taxes So it's kind of the good news bad news thing about making more money. You pay more taxes Yeah, it is it is definitely gonna be there's definitely gonna be some consequences to that at the end at the end of this but You know, that's why it's good to hold on to as much cash as you can through this And most of us are gonna be in a better cash position at the end of this So that's sort of a good thing, but Susan had a question on the idle. What were you gonna ask Liz without what we were? Yeah, she says well, what can the idle loan portion be used for or not used for? Do you know how the SBA is going to track it? So we have some info on that Civic question is I'm wondering if it can be used to rent an office space if I haven't had an office before I have rooms in my home allocated for my business But my home is currently condemned and I'm living elsewhere until my house is rebuilt So I'm thinking it would be a good time to finally get an office space I'm certain you could go to the SBA site and find the rules for what you can use for that sounds like a completely Legitimate business expense to me the you know, the the idle funds were pretty flexible There were things that you couldn't go spend it you spend it on you weren't really supposed to spend it on paying down pre-existing debt Tom does that does that sound right to you? But you can definitely use it too, you know the PPP loan was basically to cover payroll cover Your your your cost to good soul so forth and the idle was to cover operating expenses But if you want to but you got a lot more options with I would say that would be reasonable and I'm not I'm not gonna be able to make a definitive without having read I haven't read through the idle in a while But from the last I remember it's pretty flexible I mean you can't go out and use the money to go You know gamble and put it in you know the casinos and certainly at the stock market anything like that But again, you know Tom uses the word money is fungible I like this term because what it means is is if you have been making money And then you're technically what you could be doing is spending down the proceeds of your loan and your but your bank balance is Going back up right sort of like what we're seeing with the PPP. Well now that money is unrestricted You used you used your idle loans to pay for your Business expenses like payroll and other and other functions. You could make the argument at that point that All that other money whatever you have left is unrestricted. So Talk to your accountant about that make sure that that is a good You know ruling on on on that, but I think that's probably True and a good strategy again, I would be I would be cautious with Doing anything too much that's outside of the the guidance or really anything. It's outside the ends But obviously right there rent or mortgage payments is listed. Yeah Yeah, they're fairly Matt you are Go ahead Tom. Oh, there's fairly generous on the idle. It's just about any anything that you are normally paying for prior to getting the loan you can use to continue to pay for those and Even if it was something that you weren't paying for like office space or something like that What's technically you were if you were running out of your home, that was an expense You basically just moved offices, but it's still right. You should you should be solid on that I see no I see no Yeah, I see no issue with that, but Yeah, it seems like an obvious one there, but you know, we're just interpreting same as everybody else So but it looks like a goal So Leslie wants to know and you were talking about utilities Matt some were listed some were not how about phone bills Yeah There was some debate on that over the over the call Because I had a pee pee pee Yeah, there was a little bit of debate on the call between a couple of the accounts for some reason I don't one of the guys said yes one of the guys said he's not sure so I'm gonna go with yes but there what there was actually between a couple of the experts there was some debate on on I Thought telecommunications was listed pretty clearly under the utilities But for some reason there was a little bit of debate on the call yesterday that I was on I would I would argue that yes, you're fine on that the stuff the stuff that was weird was like Okay, so they have transportation costs listed as a utility and what does that mean? So it certainly doesn't mean you can go out and buy a car, right? because it all has to be stuff that existed before the PPP funds right so There was some debate on whether if you had a fuel service management contract in place before PPP well That's a utility for for You know for And he's Tom's find it. So phone is listed there. Yep. Yeah gas water electricity Yeah, and similar to previous Expenses that these service contract agreements were predated February 15th 2020 so exactly so they This is this is a CPA firm isn't coming from the you know, see SBA so This isn't it. This isn't a guarantee that it's right, but We're not gonna even need to put any of that stuff on our doesn't matter does it especially if you use them 24 weeks I feel like if we get up, I mean, okay, who here could use 20% more staff today and probably fill it with business I could I mean, you know you probably take on 10 more staff members, which would be a 25% increase for me and Fill my business. I could be back up to a hundred percent. We are turning down Deep clean after deep clean, which is new recurring customers that we're just not able to get What we're doing is is we're not offering them deep cleans We're saying we'll just jump right into a current service with you and we're putting them two weeks out And just crossing our fingers that all things work out with you know some people coming back off of You know childcare leave and things like that But we're not even selling deep cleans right now to anyone like we just can't put a job that would take two or three times The amount of the amount of you know labor and time what we're telling them is just We're gonna catch you up over time We just cannot offer you a full deep clean and we're just setting the expectations very well as to what they're getting And just really following that up with like clear expectation setting is that this is gonna take weeks to get you Caught back up several visits To do that. So we're doing that to try and avoid losing too many opportunities for new customers So I do have to say though Matt I have been really Pleasantly surprised by how many of our clients Understand that it's going to cost more. It's going to take more time. There is more expenses and that they're It's It's like they know it's coming and they're so supportive right now I mean, I know that they were really supportive when it was closing down People are we're still having people saying, you know, I'm not ready yet Donate my clean and they've donated three four cleanings at this point. So I'm kind of surprised at how If you watching your survey data like what is your so I'll give you mine But I mean, you know, we're we're normally at about 92 and a half 93 percent Customer satisfaction our survey, which would be if you're using quality driven another great product would be probably like a 4.65 or a 4.7 would be our normal score We're shooting up about like 97 percent on our surveys right now From our customers and I know we're not much better And I know our staff are hot and they're probably not doing as great a job Although I just had someone clean our house today and they did it. They did a bang-up job I mean, so I'm gonna have to give her a you know, you know a High survey, you know, so we use a five point scale But it it you know rates them in percentages to give you a little bit more granular granular detail As to what's going on. But yeah, I'm finding the customers to be pretty understanding You've had a couple of but heads, but not too many like, you know, most people have been pretty tolerable and nice and Most people That your technical term those VHS, yeah We had somebody on a $400 deep clean about some really petty petty stuff and she's like I'll pay you $100 and I told her I wouldn't even take her money So you can tell her I you can tell I'm not the customer service guru, but I felt so insulted by her hundred dollar offer I was like I'd rather not even I'd rather not even take your money. So I've had one Unpleasant thing and I decided I'm not talking to any customers until this is all over because I don't want any of that like You know so because I wasn't I was not really happy with this lady at that point So, you know, I don't need to do that stuff. That's not my that's not what I'm good at The customers of the fog No She wanted to have an owner basically about how bad we did I looked at the pictures and I was like I don't agree that you know, I just I don't argue with you. I don't agree. We did a great job I think there could have been some room for improvement, but that's not how that I told her I was like that's not how services work. I mean we you're arguing the price after after you ate the meal I mean we we agreed and we had two people in your house for you know for a whole day just about you know So it's it's you know, it's just you know, I was trying to be nice, but I was like But I think we need to come to a conclusion where you know I tried to stay calm, but she just wanted to stab us and talk you know talk trash I was like, I'll just not take your money. I'm gonna just send you I'll just we send them a contract to basically say that they can't you know I'm sorry Matt, but you have to come back through foundations again, I'm sorry We need to run you back through there and you need to learn how to handle that or stay off the phone that I Don't deal that deal with that stuff and I don't want to so that's There would have been you could have solved this for this lady I Would I would be surprised but I'll you know I'll give you her number and you can call her and see if you can settle it That's awesome. I might be able to get that hundred bucks out of her. I could use an extra We need to move along Any other questions here with No, I don't see anymore. I'm here. Otherwise, I wouldn't be How are you charging for the mat? I think she was talking about the new clients We're just putting them on recurring pricing and then just using made central to Then I was right some people are like that you're right about that Question about supplies and equipment and I think that we were talking about the eye at the time. Okay. Yeah, I don't Cover It would cover definitely cover the support. I think depends, you know, if it was You can argue a car is equipment and I think it has to be something that would be I'd be more comfortable doing with something that you could expense Maybe a vacuum cleaner even I've been talking to my accountant about that though at some point if you're buying expensive equipment that Might not be considered idle money. I don't know Purchase outright might not make as much sense, but at least might make make more sense where it's like a direct expense versus, you know Definitely because that's basically any ongoing expense that you had you can pay that with the idol if you went out and Leased yourself New Tesla or something that might be a problem. I don't know Yeah Leslie is saying that her understanding is that the idol covers anything on your schedule seat. I Don't know enough about I don't know enough about it to say Yeah, I think there's a list of on the SBA they kind of give some pretty good guidance on it It's pretty open to what you can use it for but my understanding is you really shouldn't use it to take on new debt You really shouldn't use it to to pay down. Oh, I'm sorry take on new debt I think that was part of it. They don't want you to use it as like down payment money on more on more debt And then they don't want you to use it to pay down existing debt except to service that debt But not necessarily to like you you owed a bunch of money on something else You know to to consolidate although, you know, that made the guidance on that's gonna all change I don't know. Maybe you can use it to consolidate that if it would make your business more efficient or you know If you're paying 20% on a credit card, you ran up right before this It might it might make sense to pay that down because that was all just supplies and equipment, you know, so there's That's a short-term debt versus a long-term liability. There's a lot to it You probably need to talk to your account to get all that clear. I think that Megan was suggesting that Rather than using that money directly pay down debt even if it's a Benefit to your company like with credit card debt etc that you would use the additional money is that you're bringing in that are not idle to pay it down and then Yeah, I don't money for money take like the PPP pay all your payroll and then for revenue 50 cents out of every dollar that you typically get revenue was going to payroll You can take that 50 cents and use it to pay debts that whole money's fungible thing So you can pay whatever you want to pay with the money that you're making and work Payroll and we're right about there so on so on direct on direct payroll You know just to my employees. We're back to doing about 32 to 33,000 a week So not quite, you know, so we're getting back up to where we were and our payroll, you know, not including managers Is like 14 5 somewhere around there so you put in the managers and I think we're like 16 5 somewhere somewhere in there So yeah, I think I mean if you don't have a pretty good spread We have a pretty good spread and we're not again a lot of that money is not being paid by us so just remember like you Should have a good amount of of operating funds to pay your normal stuff back And if you're if your operating account isn't growing at this point, then you probably have some other leaks You really need to fix at this point. There's probably some other leaks that you Are in trouble with if your operating account is not growing You're covering your payroll every week with the PPP funds. Yeah If you're generating revenue, I don't know if people are still shut down I feel like 99% of the country is back open if there are places that are not and I'm speaking out of turn If you're in a place like New York City or some place like that that is not reopened a residential cleaning I know we have friends that were in Philadelphia even a couple weeks ago Things were just opening up and we've been open for a couple weeks before that So I know it's all relative to where you are So that could be where you are in that situation where you are spending money faster or a little bit Faster than the rest of us, but at some point that should stabilize and you should be Getting back on top of that fingers crossed for those people too, right? Yeah, absolutely So Audrey Johnson and say, you know buy America as much as possible and that that is actually in some of the the language from From the SBA on on using the the ideal funds or idol funds is to is to make sure your purchases are if possible from American firms, so That's you know, that's not always easy to do because there's so many steps that a product went through But maybe not going on to like, you know, China's eBay or whatever and purchasing directly from China But using it, you know an American distributor at least if you have to have a Chinese made product or overseas products for sure Well, that's interesting. Is there any additional forgiveness or incentive benefit? It's just in the language. It's just in the language. There's nothing there's nothing concrete to it That's gonna put you if you have to do I Know it's something a good thing to do. I mean I'm in support of it. I'm just Wondering if it doesn't happen So, you know the average dollar spent in your community the more local you can spend your money, you know The more that it can circulate in your own community and same thing with you know buying American You know that that money circulates in our economy multiple times before it, you know, finally stopped circulating and ends up in an investment account somewhere Typically my local bank basically said that every dollar Spent in in a local bank in St. Louis tends to get research Seven times in the St. Louis economy. You know, I don't know about the I don't have any idea about how often time how many times a dollar turns over in the American economy, but Money that stays in local banks again from what their research says so if you use a local bank Six to seven times that money turns over in your local community. So if you want to get really local You know buy from local mom and pop businesses as much as you can is if you have a distributor that's a little smaller Maybe they're 5% more but you know that money helps grow your local economy a little bit more than buying from, you know, some giants So if we're buying our supplies off of Amazon for instance or some you know outlet like that then We're hurting our local economy and they're radically hurting our own business I feel like if you need something fast Amazon has its place But if there's if you can source things locally and have those relationships I will tell you that it makes a difference to have a point of contact and almost all of your and almost all of your relationships I mean, I think you know you you work as a distributor and you have relationships with these companies when you can get someone on the phone You have a question that you have and you need an answer to I Feel like you know my my local Janssen distributor, I'll give them a plug We have that we have a couple but that one of the smaller ones is new systems out of st. Louis and they're there We have Ferguson facilities. We have you know industrial So we have a couple other like big national ones that we buy some stuff that we can't source You know through them. We have you know microfibers we purchase elsewhere But our local Janssen was able to get us the victory sprayers that everybody wants to have and You know, we have a good relationship with them on being able to get you know chemicals when no one else was able to get chemicals and You know just being able to put a face to a name go into their local trade shows and you know a lot of a lot of business happens face-to-face that's why we all go to these conventions and meet people and and you know, I Think that there's something to be said if you can have some local relationships if they're selling the same product And it's within the same price point, you know, I like doing business with people that I can put a face to I think we really all saw the value of local relationships when it was time to be getting our idol and our PPP right People that had some local relationships with their bankers were in a lot better position. Yeah, and the people that were kind of I Texted my banker today about something, you know, we have mobile deposit now. So I can You know, I instead of going to the bank I mean everyone's probably doing that for years But we've always been just making you know bank bag deposits still and you know dropping them in the overnight Well, we switched to this mobile deposit and we get a couple of pretty big checks from some of our commercial accounts well, I found out yesterday that our mobile deposit wasn't set up to take a check that big and So I texted him this morning and he fixed it and by noon I was able to deposit that check if I had to call Bank of America and try and figure that out How long would that take right? But I literally just texted Luke today and I said, you know, Luke I need this turned it around by noon I think I texted him it like like nine before I went to I did a commercial walkthrough this morning And I swear I think it was it was he got back to me that it was done by the time I was done It might have been 10 a.m. I walked in at 9 Done by 10. I think it was all I think it was all done in an hour. So that's that's you know Just an example, but you know, I well were there other big changes to the PPP that we might want to be Aware of Matt anything else that we should be thinking about or more those were the ones that kind of stuck out It's kind of the big it's one of the big, you know things to really think about was, you know, the eight week versus the 24 week You know that the cutoff is either now when your loans up or the full year Or you know the December 31st look back So like the safe harbors are are kind of you know done away with that June 30th look back and all that So we're we're gonna, you know, you're gonna have to use the whole year and there's there's risk in that if you You know if you think that, you know more shoes are gonna fall this year, right? Go ahead Remember that one of the things that we had seen a little bit about was this idea that Businesses doing less than a million dollars a year would not be on the audit List not not automatically audited, but you can still be audited no matter how How small your loan is and and just for reference the average loan For the first PPP was $200,000 and for the second round of PPP was $50,000 So, you know, I don't know what the average in total is going to be But most the loans are going to be smaller than the million dollar threshold most loans Will be small but all loans over a million dollars are automatically going to be audited and we are all Subject to audit so it's just very unlikely if you have a 50,000 100,000 even a quarter of a million dollars It seems like a lot of money to us But you know, there's just so many at that level at that $200,000 level or whatever There's just so many at that level that they're not going to be able to to have that much oversight on unless Unless you're just doing something Outrageous and there have been some people caught doing some pretty outrageous stuff with this money already There are people that have created all their business documents faked it got the loans And we're like buying ferrari's and things like that. I mean There have been a couple of instances if you like if you Google PPP fraud You can find a couple of stories of some people One of them one of them I read about it this week and again It was just it's so blatant and I don't know if getting him caught but you got to think about it, right? Like I mean They're not trying to make this so that they're it's a gotcha. There were a lot of You know the beginning of this there are a lot of things that we were trying to figure out and how to how to deal with this But it's unlikely so the the short answer to what you're saying is it's unlikely if you're under a million dollars That you're gonna be subject to an audit But we all we all are subject to to that Yeah, here are a couple of other bullet points and going back to this is the statement from Steve Mnuchin I'll post this Here the safe harbor you mentioned there's a couple of those one is if you couldn't You know fully get back to business because of complying with Requirements or guidance issued by the secretary of health human services director of CDC OSHA so and so forth. So you can hit your numbers because you were complying with what the government was telling you to comply Safe Harbor means you kind of get a get a pass on that, right? Yeah So what what does that mean exactly though? Yeah, you get forgiven You didn't hit your number, but they're gonna forgive it because you've got you know, you couldn't do it because CDC told you told you you couldn't work is that gonna be gonna be really subject to some businesses like entertainment You know, like if you're you know, like there's I don't think we're gonna be We're gonna we're not gonna have any real businesses. They're not gonna be up and running by December 31st as one of these numbers, right? Check this one out though Forgiveness based on reduction of FT each provide protection to borrowers that we're both unable to hire individuals who were employees at the borrower on February 15th and unable to hot and unable to hire similarly qualified employees for unfilled positions by December 31st, so It's almost I mean, you know, if you read that literally it's like a tribe here here by indeed ads and I just couldn't hire people Yeah That's gonna be open interpretation, but let's like as an example like let's say you own a music venue like we have Let's even say them bigger like a stadium for for like Los Angeles Lakers. Yeah, the Los Angeles Lakers You know, typically there's probably a thousand people Working at a game and they probably have several thousand people that work behind the scenes like, you know, like, you know that That maybe your contractors or things like that But well, let's say there's a thousand people to make a game happen for the 20,000 fans that come to a basketball game Well, they're certainly not gonna rehire them and they're and if they did take that money They wouldn't have to make a you know They would they would just make a certification that they were unable to meet those standards And they basically got to blow that money with you know without consequences What I'm what I'm understanding one other thing to keep in mind I think one one thing if you haven't taken out the loan yet Is that it's a five-year loan now for anyone that takes out a loan now versus a two-year loan? That's another thing that we didn't really talk about Um Yeah, so Forgiven but we're working on the assumption it's going to be forgiven now which makes that move But if you did have some you had to pay back you've got a lot longer to do Yeah, and I don't think anyone should should come across that and then The deferral period is now is now extended for the rest of the year from what I understand So extended deferral for borrow payments principal and interest Basically if I want to it's basically for the entire covered period So till the end of the year there's no payments to make on any of the money So you know you're you're gonna sit down at the beginning of the year and probably get all your tax stuff to done quicker than you've ever done before So you don't have to make that first PP payment. So I'm usually somebody that's filing an extension I guarantee you I'm gonna have my taxes ready to go December 31st and you know Be on top of this that reminds me Personal income tax is that do July 15th? No, is that still my 15th? Business and personal I believe I didn't think I don't think that And you can file an extension until I think till the end of the year You don't have any penalties or interest to July 15th, which is pretty awesome. Yeah. Yeah, I'm still figuring out I still haven't done mine. I'm actually still figuring out some tax credit stuff from last year. So that's that's still on the back burner Hmm Well, let's let's figure out we're getting late 259 here. Let's run through this real quick Hey, Matt, I really like that. We bring you on as a guest and then you thank us for bringing you You're such a huge benefit I Give you guys a chance not to talk the whole time because I talk so much so it works out Well for you guys to get a break for your voice and she guys do these all week Well, I gotta say you are excellent. Like if I raise my hand you are on it I kind of appreciate that. It's like a presidential debate. You raise your hand when you have something to say Okay, well, yeah Martha Woodward is going to be joining us tomorrow Culture building during the reopening so I mean, I guess How do you read that Liz? I guess there's a lot of opportunities here during this unprecedented event when you're reopening to You know build upon the things that you want to build upon and correct things Maybe that weren't going in the directions you wanted them to go Yeah, everything is new. It's kind of like a like a Do-over for so many things and I'm pretty sure that Martha's going to be talking to us about You know how to be building your culture and how this is a prime opportunity for you If you were having any kind of culture issues before how now great opportunity for you and I will say Martha has really honed this over the last couple years. Like I've you know sat in on what she's teaching a little bit I'm I'm really excited about what she's doing and the things she's teaching. It's I mean, it's It's it's fundamental stuff, but it's just executed well So Tomorrow o'clock Eastern You don't want to miss that Martha's gonna do do a very good opportunity to hear what we need to know about Building culture and taking this as an opportunity to do a reboot if we want to I mean We've paid we've paid a lot of blood sweat and tears to get to this point to have this opportunity let's not let's not miss it Paul Weaver, he's a friend of Liz's out In Washington doing financial planning for employees, which is really kind of important to I mean Hiring is getting getting to be tough at least, you know, we're finding that to be true in some of our branches and The more value you can create for your your employees I think we're gonna be hearing more and more about this in terms of his employers We've got we got a bigger obligation to our workforce and we got to be helping our employees You know have a better life and build wealth and and that's important That's that's gonna be something we're gonna be learning Thursday and Friday is going to be on the spot and That is a activity that we do in foundations where it's a rapid-fire Q&A session where somebody has a question and Liz is myself and our special guest who you'll find out who it is on Friday I'll get one minute of peace to answer that question So there's a clock that's ticking and once the 60 seconds is up Bam, we're done it goes to the next person. So we can cover a lot of material work quick with that And that's gonna be fun Um, yeah, that that will be fun. I always love on the spot Leslie wants to know about Sean getting the information out Tom. Did he work get to you yet? He didn't and I have not had a chance to follow up with him yet But I will thank you Leslie. Thank you for for reminding me. We will we will get that Okay, well Great stuff today Matt. Thanks so much for keeping us updated super super helpful. I know Diane's saying the same thing Thanks Matt. She loved this Feels good having somebody that's like in the know and can answer those very little specific questions I'm worried. Yeah, just a biggie you guys for being here You're you're you're probably you're probably way more ahead of than most people you guys really should You know, you really should give yourself credit that you know a lot more than a lot of other business owners I talked to a lot of people. They're not here doing things like this and asking questions So, you know, give yourself a pound in the back for showing up every day There's a lot to learn and just being doing stuff like this helps Lot of people on this call that are here on the regular basis too. So yeah, good point now So mark your calendar be here tomorrow 5 o'clock Eastern for for Martha. It's gonna rock Matt Thank you for your help. This was useful information stuff that we all need to know and Be safe and we'll see you tomorrow at 5 Bye