Harmony of Hustle
Jump into the World of Justin Shoemaker aka "The Waterboy" . From Business, to music, this is the inside look of the world of the hyper-driven and their Harmony of Hustle.
Harmony of Hustle
Episode #22: Resilient Business Strategies
Discover the highs and lows of running a small business in this milestone episode as we celebrate 19 months of operation. Ever wonder how to stay resilient amid unexpected setbacks? Learn from our personal sales experiences about the power of resilience and how to handle a dip in performance when faced with fierce competition and unexpected cancellations. Hear about our record-breaking leads from partnerships and effective advertising strategies, and what went wrong that derailed our momentum.
Navigating a saturated market is no easy feat, especially when competitors are chomping at the bit to undercut prices. We break down our strategies for standing out, from offering a diverse range of product options to unique services like next-day installations and maintenance packages. Gain insights on how to communicate product quality to price-sensitive customers and ensure their loyalty through enhanced customer satisfaction and transparent sales processes.
Transitioning from outsourcing to in-house operations can dramatically improve your control and accountability, and we’re sharing our journey on this front. Discover how we’re leveraging slow periods for strategic improvements, from enhancing SEO to building a robust referral system. Plus, get the inside scoop on our foray into federal contracting as a 100% disabled veteran-owned business, including valuable takeaways from the Vet24 conference in Orlando. We discuss breaking through business plateaus and achieving sustainable growth, inviting you to follow our journey and provide feedback along the way.
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Hey everybody, welcome to today's episode. It's been a little while since I've done an episode of this podcast, but super excited to kind of go over some of the things that have been going on this week, or actually the last couple of weeks. And I think if you are a small business, you can definitely relate to some of the struggles that we've had. But we also had some wins along the way, which is obviously super important. You don't wanna always be losing. It's good to have a couple wins to at least keep the energy alive. So we just hit our 19th month in business and this month was primed to be our biggest month. Today. This was after our first two weeks. We were projected to do about $100,000. And we were just killing it with leads that were coming in. A lot of those partnerships the Home Depot one in particular, and some of our Google ads that we started running were really doing very well, and so we started seeing a mass influx of leads come in, and my closers were actually doing really well this month and we're closing pretty much everything that was coming in, so we had a lot of momentum coming in. They were also generating their own leads, so we had a really good marriage, finally, of lead generation closes coming in and uh high sorry high closes coming in and then also self sets and referral business coming in. So we had like that perfect marriage where all the leads were coming together and we were getting a lot of deals that were coming in and so it was looking really, really, really healthy.
Speaker 1:For those that don't know, I mean I'm in home service, do water treatment, and the traditional trajectory for our business has been a couple sales in the first week, no sales mid-month, and then we get like five or six or seven sales at the end of the month and hit our targets. That's really been how it has been for the last five or six months and we've been trying to tweak things in the business to stop that, and it seemed like this month was finally going to be the month that we cracked that code and unfortunately it didn't happen. We had some really big ticket sales go in and they ended up canceling day of install, day before install. We also got undercut by a competitor on one of the deals by almost 50%, which was pretty brutal. So that actually set us back pretty significantly. And then as far as having a small sales team, which is what we have right now.
Speaker 1:It definitely killed the momentum for a lot of my guys, especially for a couple of them. Some of these sales were their biggest deals to date, right, so what turned into a springboard actually turned into a bit of a sandpit and kind of sucked the energy out of them. And you know, having to build that energy back up takes time and if you're a veteran in sales, you understand that this is part of the game and it always comes when it's always the most inconvenient. That is the unfortunate part about being a professional salesperson is you will have these really high highs. You also have these really low lows and then you'll also have what feels like a really high high that turns into a low, and that's unfortunate, but it's part of the game and how you can get through. That is what will set you apart from being a professional or being someone that can only do sales for a season. And I will tell you from personal experience those seasons are what have grown me into becoming an incredibly high performer.
Speaker 1:I know back when I used to sell solar, I had a week where I sold seven deals, big systems, and I was primed to make anywhere from 20 to 30 grand that week in commission sales, and literally one on the same day, every single one called me saying they had to cancel for one reason or the other and I think I saved one of those deals and the company was only able to save one of those deals. So talk about a gut punch, especially because those sales were in the new office that I was in charge of building and at the time it seemed like that was it. I mean, I had been working for five months and that had been our biggest week ever and for me it was much needed, commission, for how much work I was putting in. So at that point it felt like it was all this work for nothing. Fast forward, not even a month later, and completely crushed those numbers and I think I brought home my first $60,000 a week commission check. So, but I it taught me a tolerance for pain, and that's what these these things will do for you. It taught me a tolerance for pain and that's what these these things will do for you is teach you a tolerance of pain.
Speaker 1:And on a business level, this will be the first month in the 18 months we've been in business, uh, that we may end lower than we have any other month? Uh, every month. So far, we have grown month over month and this might be the first month that we actually have a bit of a setback, which sucks. There's no way to, there's no way to sugarcoat it. It freaking sucks, especially when I'm still spending the same amount of money on the marketing. And so the first thing I want to talk about is you know, what do you do when you have a month where it looks like you're probably not going to hit your targets, and how do you adjust and how do you stop that from happening again?
Speaker 1:And I did a deep dive into just our sales volume and it really was. I'm not I'm not gonna say lucky, but every month that we hit our target we were blessed with no cancellations. So this is the first month we've actually had to deal with cancels. We've had, I think, for home service, a historically low cancellation rate. Before this month our lifetime cancellation rate was less than 3%, so very, very low. So pretty much anything that we sold or get what we were putting in. And I would say this month we were doing more volume.
Speaker 1:And I think, inherently, what that discovered was probably a fault in either our pricing structure or our turnover structure. Now, until recently we weren't able to do next day installs, which, for the water treatment industry, is very important. You want to get these jobs in literally the next day if you can, so up until last week we haven't been able to do that, and what's ironic is some of these deals that canceled. We had them scheduled for not a next day install but the day after, so we were still getting these things in pretty quick. But I would say the biggest change that I have seen in our business is we have raised our prices. Our delivery has gotten much better. We have just created our own product line, which is, in my opinion, the best in the industry right now, and so we are charging more for those services.
Speaker 1:Now, unfortunately, what I have found is in one of the markets that we're in so we serve the entire state of Virginia and in one of the markets that we're in we do have a competitor who is now matching our warranties, which I believe they were probably given that information from someone that I know, or I mean we're in the same home. So, especially with a deal that we lost to them, they got to see everything that we offer them, thing that we offer them and I know historically that this mentor or not as mentor this competitor does not offer the same warranties that we do and I even I even confirmed that because I've dealt with some of their clients before in the reverse, where I was the company coming in behind them and they didn't offer the same warranties that I'm offering. So I ran into a weird situation where you know it really does pay to to be the last company in, sometimes because what they were able to do was literally hack my prices in half. Now, obviously, we're offering the same quality of product, but you know, to a homeowner and it's something that I had to learn the hard way is you really have to understand that these homeowners don't understand their product as much as you do. And if someone can come in and tell the customer that their thing will do everything that yours does for half the price, it may not have all the capacities, but it'll get the job done at half the price. If the customer is at all price sensitive or they're having some buyer's remorse off the price they've paid, well, they're going to go with the cheaper product and you're going to get commoditized, and that's a difficult thing and that's something that I think is something that we're trying to solve now moving forward, is how can we anchor in our clients minds that if they do buy our more expensive products, there is a reason why they're spending that? And one solution that we're rolling out and we can test this is just offering a wider array of our products at sale In water treatment.
Speaker 1:What tends to happen is we will create a pricing structure and a product structure based off the water test and what the client needs. So if they're on well water, they'll need a specially certain tank, a special, a special amount of certain tanks. If they're on city water, they will need a certain number of tanks. Right, city water tends to be pretty standard. Really, we have two tanks that we offer for that um, mid and high. Excuse me, but I think we are going to be offering um a low ticket item, uh, here in the near future.
Speaker 1:Uh, just that way, if you know, a customer is price sensitive and they really do just want something that isn't going to break their bank, that we have that available to them. I I know previously what we were doing. We were just offering what we knew to be the best solution for that to our clients at the best price. But I do think that pigeonholes us, especially if they decide to shop around. Because if we just offer them one solution but we have other solutions available, then if a client does come back to you after they've been offered a cheaper price and you say, well, hey, I do have this other thing that can still do this thing, but it's going to be cheaper and it won't have these capabilities, you kind of lose credibility at that point and it is going to kind of seem like you're just trying to sale them as a salesperson, whereas if you open up your entire product shop and say, hey, listen, I have a low ticket offer, I have my mid ticket and I have my high ticket shop and say, hey, listen, I have a low ticket offer, I have my mid ticket and I have my high ticket, if they decide to go with the mid or the high ticket thing and then let's say they do have a competitor come in and they try to say they have the exact same thing you offer at a lower price, you can dive into why that's probably not true. Or you can just say, listen, I do have something that can beat their price, but it does have lesser capacity. And what I've found in my industry in particular is what tends to happen is the system that they're offering for a lower price it doesn't have the same filter capacity or the same medias or the same ability to get rid of contamination as our higher ticket products. So that's very important and I'm sure in your business you have things that you know you could sell at a higher ticket.
Speaker 1:I would do that and and let's say you're in an industry that's a little bit more commoditized, where it's hard to do, like I know, roofing is a very specific industry where a lot of the roofers are using the same approved types of shingles, so it can be kind of hard to differentiate yourself. I would look at what you do in the business and try to find some sort of a service or something that you can do above and beyond that you could add additional charge for that would differentiate you from the competition. That could be routine checkups, cleaning, roofing inspections, free shingle repair up to X amount, whatever. You know the business better than I do on what you want to do for those margins. But that that's how I would start to look at it and that's things that we're going to start doing now in the industry, um, or in my, in my company. I don't want to go too much into that right now, just cause, uh, I don't want to give away the secret sauce until I know it works. But, uh, I am looking at adding in some methods into the business that will also allow customers to pay for things that are ancillary to our main product line. That will just make it seem a little bit more full turnkey service in the business, so that way they can buy a system from us, but then they could also do things that will allow us to take on some of the requirements that the customer would have to do, whether that's maintenance, salt replacement, things like that. So we got some of those things in place.
Speaker 1:Also, getting next day installs is going to be imperative to us, because a lot of times, if you can get these things in the next day, the clients, once they have your product, they're going to be super happy with it, which we know they will be. Anyone that's gotten our products has been incredibly happy about that. I've only gotten five star reviews. We did get one one one star review from a fake customer that was unhappy. It was a personal thing with one of the people that's on my team and unfortunately, they went and left our company a one star review because they were having a personal issue at their home. So this is the other thing about owning a business is you're going to deal with these types of things where it's completely unrelated to your business, but personal issues come into the the company and you have to deal with it. So, um, but as long as you can make sure that your product's good, your delivery is good, you'll, you'll be fine.
Speaker 1:Um, outside of that, uh, I am going to be systematizing and re-enhancing the sales process itself. Uh, I've been listening to a lot of my sales guys and what they've been coming back with, and I think there's going to be a simpler way to present the packages that we offer, and I think that will increase the close rates of my guys as well as increase referral rates and allow us to price match a little bit better in the market. I definitely think there is a disparity in how these systems are presented to clients, and I think it's just because of lack of education, and I think they need to clearly be able to see what differentiates us from the competition. So we're going to be rolling out some different sales packaging. That would help with that and I think that will help sales tremendously.
Speaker 1:Outside of that, I'm dealing with, I'm sure, something that a lot of small businesses deal with now, and that is inconsistent lead flow. I made a video on YouTube a little while back about my $150,000 HomeAdvisor framework and really that was the saving grace for our business. You know, homeadvisor really did feed us. I was able to take $7,000 through HomeAdvisor and turn that into $150,000 in sales, so really good return on investment. What's happening now?
Speaker 1:Unfortunately and I do think that maybe there is some socioeconomic factors playing a role in this but the lead flow into HomeAdvisor has been almost non-existent the last two and a half three months. We used to get, I would say, 50 to 60 leads in a month at a minimum, and there's some months we get higher. This month, I think we haven't even cracked 20. And that's unfortunate because we have a good amount of reviews on there now all five stars and we have a massive budget. So for those of you who don't know, homeadvisor works on a budgeting system where you set a budget and the idea is they try to fill that budget up with leads. So I have my budget set to $20,000. I have a massive service area so, especially for my state, I should be capturing a lot of those leads and I've been talking to their customer service and it's just been super slow, although I did see an article.
Speaker 1:Due to the inflation, due to the economy, home Depot and Lowe's in particular have seen a significant drop in home improvement projects and sales. So, with my industry being in home service, we also have to be understanding of the fact that the economy is going to be driving a lot of the home improvement decisions. So what that means is, while we're in this state of the economy, we may need to tailor back our pricing and go into some more low product offers, because that's just what people can afford right now, or that's what they perceive that they can afford. Um, I mean, even in my industry, financing can be a little tough. Uh, the banks have definitely gotten stricter and sometimes the financing rates just aren't as good as you would want for for some of these financing uh projects. And especially if home you know DIY wires or people that invest in home improvement projects, if they're being affected by the economy, whether that's lack of jobs or you know paying for things that's more expensive then they're going to be less likely to want to spend the investment with our higher ticket offers. And to put into context, I mean some of our highest ticket offers go from $12,000 to $15,000. So we offer some really, really premium products and it may be required for us at this point to scale back on the residential side and go focus more on $5,000 to $7,000 offers that we have and not try to push the premium products as much. And of course, I think that pendulum will swing back the other way. But you've got to be agile in the business and I think for right now, that is probably where we need to look at. As far as you know, how do we, how do we tackle the drop in in in home improvement projects? Because you know we have a partnership with Home Depot, so that directly affects our lead generation, one thing that we've been doing as well. We had a partnership. We were bringing all that stuff in-house. So I think lead generation will get better now, now that we'll have control of the call center process. We did just get a call center set up internally, which is amazing for us as a small business owner.
Speaker 1:A lot of times you're going to have to outsource what you do to other companies. If you know someone in the game, right, let's say you're in home improvement or roofing or solar or sales, whatever it is odds are you're going to have to outsource it to somebody else and that's totally fine. But the moment you can bring it in-house, it literally gives you the best outsized returns because, one, you control the product, the quality of the delivery of the product you deliver, the quality of the deliverability of the implementation of your sales process, right? So, for example, if you're using an outsourced call center, they may be working on their own projects or other companies projects, so their attention to that call center isn't going to be as direct and as focused as if it is your own call center that you're paying out your own pocket. It also allows you to train them to the standard that you want them to be trained to.
Speaker 1:If you're using an outsized call center or a different, another company's call center, you don't really have the ability to go in there and train them in the way that you want them to function. With this you do, you can also hold them more accountable because you'll see the real-time statistics on how they're performing. So that's huge, the economies of scale that can't be understated and that is the one thing that we finally got rolled out. So this next couple of months we should see an improved throughput on the Home Depot bottle drops that we actually send out from these stores, because right now, looking at the stats, I think we put out 3,000 bottle drops and I don't have the numbers on me but we had a 50% close rate. I think we got 30 qualified appointments in and we sold about 15 of those. So 50% close rate company-wide, which isn't bad, but the actual throughput of people that we sat compared to bottles that we put out there was less than 1%. So that, right, there is the first lever that we'll be looking at to improve, and I think that's what's beneficial about slow times in the business when you are struggling, is it does allow you to see the weaknesses in your business and if you can improve upon those when things get better again, you'll be better positioned to crush it even more.
Speaker 1:We have struggled in a lot of different things. I mean getting referrals has been a big one. We are still working on that cadence, but creating that referral cadence is going to be huge for us to make sure that we actually can follow up these people in a timely manner. We just brought on a virtual assistant who's going to be helping us with that aspect of it. We just got some new review cards made so we can try to get more reviews on our site. Obviously, reviews will drastically help our SEO. We've been running a lot of Google ads and SEO ads, which have been really helping us. But when it gets slow, you get to see where the vulnerabilities are in your business and that is actually a good thing because it allows you to attack those and make those drastic improvements. If you just say woe is me and you blame everything else around you, you never get to actually improve, which is probably the worst thing you can do With.
Speaker 1:That being said, we have also started looking at a different market segment. So, for those who don't know, I am a 100% disabled veteran out of the Navy. So we are a registered SDVSOB with the federal government, which means we as a company, if we were to bid on federal government contracts, there are certain set-asides that we can bid on that nobody else can bid on. So only companies with our designation that do what we do can bid on those things. So last week we flew out to Orlando and went to a Vet24 uh by the national uh I can't remember the, the name of the now, but it's the national um foundation for for for disabled uh and underprivileged, uh, business owners. So that's your. You know, women-owned businesses, minority-owned businesses, all those things, and vet 24 is it's a massive conference, um, and it's it's hosted veterans and they brought in the top federal government contractors and the top speakers, the top prime contractors, the people that write these contracts, people from the places we're trying to win contracts from, like Veterans Affairs, gsa, dla, big, big, big people, and some companies are doing $1 billion to $ 10 billion a year in contracts. Right, we got to meet and talk with these people and it was a massive networking event. Uh got to learn a lot about how to win these federal contracts and that is going to be our.
Speaker 1:A big push for us by the end of the year is to team up with some of these organizations as well as win our first couple of contracts, because the great thing about government contracting is it is recession proof and i'll's hard, don't get me wrong trying to win these contracts. It's a whole nother business, but I think once we start winning these contracts, it's also going to build a lot of legitimacy into our residential and commercial side. Because if that way when a customer comes with us, we can also show that we are trusted by the federal government to do the type of work that we're doing, and that will give us even more credence on why we charge what we charge. Because you know a lot of these residential companies. They just you know they'll sell cheap residential water treatment systems, right, and they'll make a small margin. They sell it at volume and the real reason why they're selling them like that is they want that recurring revenue. They want that yearly maintenance cost, every single year to come back and service your system. That's the model. I'm trying to disrupt that model a bit. I want to sell better systems at higher prices that last longer, that require less maintenance. That will eventually make you happier in the long run.
Speaker 1:So I think having you know a big component of that by being teamed up with a big business or being able to say that we've done a Veterans Affairs facility or we've worked on these big government contracts will will really help establish us as a professional in the space. It's going to take a lot of work. I'm gonna tell you, looking in the space, it's going to take a lot of work. I'm going to tell you, learning how to win these contracts. It's so much more than just bidding for it and showing your capability statements. You have to actually build a long-lasting relationship with the people writing these contracts so they know that if they do pay for you to do this, that you can actually deliver. Learning how to read the contracts is its own thing. Learning how to forecast some of these contracts is another thing. So there's so many little idiosyncrasies that go into this stuff. But I'm really excited to have that be another part of our business, because having that government work is something I've always wanted to be a part of and I think you know, being able to have the designation that I have gives us a very unique opportunity to tackle some of these contracts.
Speaker 1:So you know, moving forward into the, going into the end of May, going into the next month of June, we have a couple constraints that we need to fix on the residential side and then some implementations that we need to fix on the residential side and then some some implementations that we need to make on the commercial side. So for the residential side, we are doing a mass hire right now. We need to get more sales directors in, or should I say sales directors, but more sales generators in and someone that can manage them. So I'm looking for sales management and I'm looking for just sales bodies to fill these pipelines up. It's become very apparent that my sales team has basically reached their relative max. I mean, I got some great guys on here but they can only do so much and we need to just pump this pipeline full of leads and as well as more referral leads. So we need to get more bodies in so I can put them in these Home Depot stores, get them on the streets knocking doors.
Speaker 1:That's step number one. I need to get more bodies in, I need someone to manage those bodies and then I need someone to manage the closers. So that's kind of my focus in these next couple of months is just building Now that we have more process built in, is just filling up the actual employee pipeline and getting more bodies out there hustling and working. I'm going to need to get a new plumber's assistant here soon, as my primary plumber is going to be starting to get overworked because our workflow is getting up there and then finding ways to get some funding into the business so I can buy more equipment, which will give me cheaper equipment spending overall, which will then allow me to install faster. And then those economies of scale do mean I get to buy those same systems at a lower cost. So a lot of things to work on over the next few months.
Speaker 1:I, you know, I created a task list of the most important things that we can get done. One big improvement that I have found that, if you are a business owner, I would implore you to do is meet with your top producers, your top sales guys, and get them involved in the decision making process. Have them pitch you some ideas on what they think can make it better. Again, they're in the homes every day so they can give you some really good insights. The making a competitor comparison sheet actually came from one of my guys, charlie. So you know it's a great idea that we're going to be implementing to improve our sales processes. So you know it's a great idea that we're going to be implementing to improve our sales processes. So definitely do what you can to improve and identify those constraints.
Speaker 1:Like I said, for us right now it is personnel and after personnel it's going to be getting the products and the equipment. But, yeah, thanks for listening, guys. This has been, you know, more of a behind the scenes of what we're gonna be doing and I will update you guys as this thing grows. Like I said, I wanna use this as a platform to not only bring on people who are killing it, but also as a way to give you a little look behind what it's like to be in a startup and be along for the whole journey. I mean, we've come a long way.
Speaker 1:I remember, not even a couple of months ago, I would be a static doing 70, 80 K a month, consistently, um, and that's where we're at Um. But we have hit a plateau and now we got to get past that plateau and that means we got to grow and we got to grow correctly and, uh, we got to. You know, figure some things out and try to see where the thing can go. So thanks, guys for listening. I hope you found some value in this. Follow me on my socials, if you haven't already. I am documenting this on there as well. If there's things you'd like me to talk about, things you like that you don't like, definitely let me know so that way I can make this more valuable for you guys. All right guys. Thank you much for listening Peace.