Original subtitles

This is Philip. He gave up a highpaying

job in tech to start a garbage

collection business. Last year, he lost

$150,000. So, Philip has a wife and a

kid and another baby on the way. And if

he doesn't fix the business model fast,

he'll put that growing family at risk.

Hi, my name is Philip. I'm the owner of

Garvey Disposal Services. We do

residential trash, recycling, and yard

waste collection. Our revenue is

642,000. Our net profit is -151,000.

>> That's the wrong side.

>> It is on the wrong side.

>> All right. Our net margins are negative

23%. We've been in business for a little

under two years and we currently serve

2500 customers.

>> So what's the problem?

>> We need to become profitable.

>> We're not utilizing our assets enough.

Trash is a very capitalally intensive

business.

>> Totally.

>> One of our trucks is a half utilization.

Routes are not super efficient.

>> We've had lots of unexpected repairs. We

need more leads. Scale up our doortodoor

efforts. We need to scale up our meta

ads efforts profitably though.

>> Mhm. And we need more conversions on the

HOA side and we need to increase our

route efficiency. So, a lot of things we

need to do.

>> So many things. Why is solving this

important? What happens if you don't

solve this? I'm definitely in the thick

of my rocky cut scene right now where um

I left my highpaying job at Amazon as a

software engineer to start this cuz I

thought it was a great opportunity

>> and I have been working 16 hours a day,

7 days a week for the past 2 years with

really little to nothing actually

negative to show for it.

>> And I have a wife and a child at home

and my wife is actually due in the next

6 weeks which props to me. So, I need to

make sure that I'm able to provide for

her and my daughter and uh the new baby,

especially as you know, my wife won't be

able to work. So, it's really crucial

that we figure this thing out sooner

rather than later.

>> And I think we're really close because

>> by my estimations, we 3,000 customers is

going to be that critical mass point

where we're going to start to make some

money.

>> Mhm. So, here's my promise to you, which

I don't normally do. By the time you

leave, you'll feel absolutely clear on

what you need to do in order to be

profitable. All right. So, I'll I'll

stay as long as it takes to make sure

that you're good.

>> Okay.

>> All right. Okay. All right. So, who do

you help?

>> Yeah. So, we have two types of avatars.

50% are what we call scatter. The other

50% are HOAs. And there's two different

types of sales processes for these two

types of customers.

>> Yeah. What's the is there is there a

difference in in like home value or

income in the scatter versus HOAs? or

HOAs t do they tend to be nicer than the

other ones or

>> we've had some HOAs that are lower

income for sure

>> and then we have some scatter customers

that are much higher income that scatter

group is is thinking about switching to

be an HOA so

>> typically it does correlate with income

the HOAs are higher income

>> in general right I think there's going

to be a big strategic decision that

we're going to have to make that you're

probably not expecting and it's around

>> it's around who the avatar is. So we'll

talk more about that. The second thing

is going to be how you acquire them. So

how do you help them?

>> Okay, so we have two different types of

services for two different customers. So

our scatter customers have once weekly

trash, recycling, and yard waste

collection.

>> Most don't have an existing contract,

>> so we can just get them set up and start

service even next week, but typically

the beginning of the month is what we

do.

>> Then our HOAs have two service options

there. So they can either have once or

twice weekly trash collection. Most of

them opt for the twice weekly trash

collection.

>> Sure.

>> Yeah. 80%.

>> So they're on three or fiveyear

contracts usually and so we wait for the

end of those contracts for us to be able

to bid.

>> Do you reach out to find out when the

end of their contracts are and then you

just have put them in a calendar

basically

>> Excel spreadsheet.

>> Yeah. Okay.

>> Yep.

>> Yep. So once those are up for bid then

we start to uh then we just calculate

the price and everything and then we

often the low bid will win.

Unfortunately, that's kind of the name

of the game.

>> That's what I want to talk to you about.

Yeah.

>> So, we'll get Okay, let me ask one more

question about the the slide before,

which is who do you help? So, of homes

in your area, do you know what

percentage of them are scatter versus

kind of like contained within HOAs and

like kind of off the basically off the

board until they come up?

>> In my service area, the there's a very

large majority that are HOAs.

>> Okay.

>> Yeah,

>> that is Do you have any idea what

percentage? I don't know, but I can just

see it on a map.

>> Just if you guesstimate it for me, it's

fine.

>> Um

>> 70%.

>> 70. Okay. Okay. Are there a lot of other

competing trash services on the scatter

side?

>> There's one big one that's really

causing us to reduce a lot of our prices

right now.

>> Yeah, we're going to we're going to

we'll we'll deal with that. Okay. Got

it. Okay. Let's keep going. So, give me

the the money stuff. How do you make

money?

>> So, for our scatter customers, we charge

$29.67 a month, which is built quarterly

at $89. And as an intro offer, we offer

three months free. That's not all in one

go. That's just on the third uh excuse

me, second, third, and fourth invoice.

>> Yeah.

>> And for our HOA customers, it varies

pretty widely. It really depends on, you

know, the home type, whether it's a town

home or a single family home. Single

family home with a lot of families are

going to produce a lot more trash and

then we have to pay that at the

landfill. Um, and so it also varies

depending on the number of units as well

as the proximity to our current route.

Um, and they're actually all on a

monthly billing schedule,

>> but but the scatter ones are on a

monthly billing schedule, too, right?

>> No, they're built quarterly.

>> Oh, quarterly. Excuse me. Got it. Got

it. Got it. Okay. Yeah.

>> You price you price monthly. I got your

>> Yeah, exactly. Y

>> Okay, cool. Okay. So, how do you get

customers?

>> We have four different channels through

which we get customers. So, we have door

todoor and I currently go and do right

around 300 a week. I knock out 300 doors

and my close rate is right around 26%.

And we hired a

>> What's your door open rate?

>> Door open rate was I don't have that

ready,

>> which is rough.

>> I believe it was around

30%.

>> Is it really?

>> Yeah.

>> Dude, so you knock on 12 doors, you get

a sale.

>> Yeah.

>> So chill.

>> Yeah.

>> You can just like You're like, "Hey, I

got to get lunch." You're like, "Give me

two seconds." Just like knock on 12

doors and you buy lunch.

>> I'm not the best sales guy, but yeah. I

mean, I can even sell. So,

>> okay. Yeah. Okay. There's There's some

things that we're going to do in the

offer that think's going to help us out,

but Okay. So, doortodoor, $50 commission

per sale. That's what you're paying your

current sales guy?

>> Yes, exactly. And he recently started

with us 3 weeks ago.

>> Got it. And he's How many deals is he

doing a day?

>> So, he's been getting better and better,

but right now he averages right around

five.

>> Five a day. I mean, it's not a bad It's

not a bad gig. And he'll just keep

getting better, right?

>> Yes.

>> Like yesterday he got seven.

>> That's awesome. Yeah.

>> That's good. That's really good. That's

very exciting. Okay. Now you pay him 50

and he's collecting less than 50.

>> No, he'll he's a a contractor, so he

just gets all the 50.

>> No, no, as in for what? He like he's

collecting less than 50, but you pay him

50 for getting the sale.

>> He collects the 89 for the first

invoice.

>> Okay. For the first three quarter or for

the first three months.

>> Yep.

Okay. You said that it was you said it

was month 2 3 4 is where they're getting

their free month

>> the quarter 2 3 4.

>> So they get one month on quarter two,

quarter 3 and quarter four. Okay, got

it. Understood. Okay, that's fine. Okay,

so let's walk let's walk through the so

I understand the DDD. Do you have

percentage breakdowns on these between

which one's what in terms of how many

are coming from door to door? How many

are coming from paid ads? How many are

coming coming from outreach? How many

coming from referrals?

>> No, I don't have those numbers.

>> Rough estimate. Yeah. I mean, recently

I'd say 50% have been coming from door

to door because I've really been

pounding the pavement quite literally.

>> Yeah. Yeah. And then we leave cards

there and stuff and then people sign up.

>> Yeah. I did see your door hanger got

1.2%.

>> Yeah.

>> Super interesting.

>> Yeah.

>> Yeah. Okay. Let's Okay. Well, we we'll

keep going. Okay. So, paid ads, you're

spending 600 a month.

>> Yep. Yeah. We have meta ads. We run 600

a month. That gets us HOA and scatter

customers, but they're marketing. We're

we're targeting scatter customers and we

also do cold outreach. So cold email I

exhaust that list pretty quickly. And

then I also have started doing in the

past uh 6 months uh handwritten letters

to members.

>> Yep.

>> 100%.

>> And then we also have referrals for our

scatter customers and the for each

referral they get one free month of

service.

>> So I'll just say this right now. If you

have call it 500 HOAs which represent

70% of the market is not a cold email

play. So that's where it's the

handwritten card personal gift drive up.

It's like you have 365 days. It's like

go to two a day. You know what I mean?

And obviously you're going to have the

ones that are due, you know, with their

own whatever the renewal is. And so even

if they're on threeear cycles, 500

divided by three, so it's 15. you go to

one every other day where you decide to

do one day a week where you visit seven

and it's like you are 100% up to date if

you just did that. Yeah, I think there's

some there's there's opportunity there.

Okay. So, and then referrals.

>> Yeah, referrals for our scatter

customers when they refer their neighbor

successfully, they get one free month of

service. Okay.

>> We also fasttrack them after they get 10

referrals and we just give them a for a

year at that point.

>> Cool. Does that get a lot of people?

>> Not as many as I'd like. I I don't think

I've been good enough about nurturing

referrals, but

>> I have I have ideas. So, how many do you

help? What's your sales velocity per

month? Okay.

>> Yeah. So, we get total average leads is

217 per month. We close about 72 of

them.

>> That's good.

>> Which is a 33% close rate.

>> And is that when you see leads there, is

that from Meta primarily?

>> A lot of them are organic, so they'll

see our cans and then

>> Oh, [ __ ]

>> Yeah.

>> And do you have like QR codes and things

on the cans?

>> No, we don't.

>> Interesting.

>> That's interesting. Well,

>> yeah,

>> I'll write that down.

>> Yeah,

>> but yeah, they'll see our cans

throughout their neighborhood and be

like, "Everyone's switching to your

service, so I might as well switch,

too."

>> Yeah.

>> And they Yeah, that's They just call in.

>> And so our average month for HOAs is

usually two leads.

>> And you provide the bins?

>> We do. Yeah.

>> Do you have a specific color or do they

have to be a certain color?

>> Yeah, I think it helps with our

branding.

>> No, so they do have to be a certain

color.

>> So they can provide their own if they

want.

>> Most people just want our bins.

>> Okay. Okay. And so we provide we provide

a trash and recycling container.

>> All right. I have so many ideas. Average

per month you get two HOA leads. You

close half your HOA leads. That's great.

>> And those are somewhat inbound. Or is

that from the outbound efforts you're

doing?

>> Yeah, those we'll we'll start with the

outbound and then we often times they'll

reach a property manager. Yeah. Or

community manager rather. And then

they'll say, "Hey, not interested right

now." And then they'll reach out later.

>> Got it. Okay. Heard. So you've got a

thousand scatter, 13 HOAs, 2500 doors.

Okay, let me give me all the other

numbers unless you think there's

anything that's important here. HOA

customers more likely to convert in

spring and summer. Okay,

>> just that our churn is super low. Um,

but I think that that might change if we

increase prices. Um, because we haven't

been as aggressive for increasing

recently.

>> Yeah, I got you.

>> Yeah.

>> Okay. Yeah, cuz I do have I have a bunch

of questions on gross margin, lifetime

gross profit insurance.

>> Yep. Yeah. So, our our revenue is

642,000 as I mentioned earlier, 151,

gross margin 8%. Um, net margin -23.

>> So, how's your The gross margin seems

off.

>> Yeah.

>> So, how is that how is it 8%. Cuz it

can't c like if you're charging $29 a

month, it's not costing you $26 per

month for each incremental ad.

>> So, that was this past year. And this

past year was rough with repairs.

>> Yeah. The $100,000 repairs.

>> Yeah. Just for one truck. Like, that's

not even all the trucks. Like, it was

pretty excessive.

>> Brutal.

>> Yeah.

>> Okay.

>> Yeah. So, blended CAC of $67 with a

blended LTV of $1,300.

>> And is LTV like like lifetime revenue or

gross margin?

>> Gross margin.

>> Okay. Okay. That feels better. What's

annual retention

>> or monthly churn? Either way,

>> uh it's at point4%.

>> Nice.

>> Nice. Sick. That's really good. Okay.

So, and then you've got marketing at

$1,000 a month. Is that you that

includes doortodoor?

>> Yes. Marketing with door to door. That's

actually we since we just started that

guy that's going to be increasing

>> be way more obviously if he's closing

seven that's three you know that's 350

right there. Okay.

>> Exactly.

>> What else you got?

>> So our numbers by customer type. So

50/50 for our revenue. So 300,000 for

our HOAs. And then um we have a CAC of

$1,200 with an LTV of 23,000 and an LTV

CAC of 18 to1.

>> And our gross margins on this are 23%.

And we have a total of 13 of these

customers. And the reason the gross

margins are off there compared to what

was last year is because I'm going based

on, you know, backing out some of those

costs that we had

>> that are oneoff one-off costs. And then

for the scatter, we have 300,000 in

revenue and a CAC of $51 and LTV of

a,000. 21 to1 uh LTV to CAC and a gross

margin of 26 to 40%. And the reason I

did that range there is because right

now it's at 26. But once we get

efficiency, it's we're very easily going

to get to 40.

>> Yeah.

>> Yeah. You can also raise prices a couple

dollars. It's like, oh, look, we go 10%,

we add three bucks.

>> That's true. Yeah.

>> Yeah. Okay.

>> Yeah.

>> Let me see the ads. So, we have a total

ad spend of 7,500 with a cost per click

of $212

and total clicks of 3500 with total

sales of 153 and a CAC of 51 uh 63 with

an LTV of a,000 just like the other ones

and then LTV to CAC of 20 to1.

>> What stops you from just spending

70,000?

>> A lot of it is our our cost per lead

goes like crazy crazy high because it's

such a small area we're marketing

towards.

>> I'll tell you why, but okay. when I was

doing it. I could be doing it wrong. Um,

but it was just it was

>> you're doing a lot of stuff right.

>> I feel like I'm doing everything wrong.

>> No, you're good. You're good. We'll get

there. Okay. So, meds, I got this. These

numbers are good, though. I get You're

saying that it skyrockets after a

certain point. We'll deal with that. Do

you have any other metrics or creative

to show?

>> I have the cold outreach. It's kind of

skewed a little bit because it's so low

for our our cost per lead because it's

all public data. Um, but this is for

email as well as uh the direct mail.

>> You're just not valuing your time

because you're the one doing it.

>> Yeah. Yeah. That's right.

>> Okay. Yep.

>> So, yeah. I mean, $12,000 if you have

700 to one. Yeah. Let's do more than

that. Yeah. It only cost you $174 to

make, you know, $12,000.

>> Really?

>> And you got nine more HOAs in the

pipeline.

>> We do. Yeah. I'm a lot of them seem very

interested.

>> If you close half, what happens to the

business?

>> The business grows substantially. Yeah.

>> Okay. That sounds chill.

>> That sounds pretty good.

>> Okay. You know, so what's really

interesting about your business is that

we have two key decisions that we have

to make. Decision number one is what

avatar we're going to focus on. Decision

two is what channel we're going to focus

on to get them. I think the direction we

go in will depend on you, but you might

be surprised by which way we go.

>> Okay.

>> If you had to wave a magic wand, what

thing is giving you the most heartburn

right now?

>> Not being able to

>> obviously money.

>> Yeah.

>> But what's the what's the indicator

prior to that? Like is it like if people

paid you $200 upfront that would change

the economics of the business

dramatically? Like is it simply just not

getting leads? Like I'm like that's I

just want to understand that part.

>> Yeah. It's more about offsetting some of

the upfront costs.

>> This is what I want to solve for which

is I would like to have the most

scalable acquisition channel we can that

can get cuz also you you're like if you

spend $7,000 even in a local area,

you're not even getting close to

tapping. How big's the the market

overall? Like on a you know 10 20 mile

radius?

>> Yeah, it's pretty big. A few million

people.

>> Yeah. Right. I mean like you're not even

close. So like I would love to see spend

at like 7 $10,000 a month on the

Facebook side and then probably another

5 or 10,000 a month on PBC which will

have super high intent. I'll have

different metrics around it but we'll

get there. For

us to solve the problem for good. We

just need cash in the first 30 days to

be greater than your cost of goods sold

and CAC fully loaded,

>> right?

>> So, do you know what that number is?

Like what's

So, let's ignore CAC for a second. I

guess we have 50. We can use that as a

placeholder or 67. We want to be bullish

or bearish. So, $67 CAC. And then what's

it cost to kind of like onboard someone

and kind of like get them going?

>> I do that all myself. So I don't I mean

>> if you paid someone and you and the bin

was you had like fully fully bake it in

cuz we want to scale past you,

>> right? Yeah. So to deliver all the

containers for you know let's say like

200 customers it' be about $500 to pay

someone.

>> So that's two $2 like50

>> per customer.

>> Yep.

>> So that's not big. So when I'm say so

you get where I'm going with this where

it's like okay if it cost us $70 if we

made more than 70 on the first

transaction which you do

what's what's something like what's

stopping is just that like you can't get

more leads and then it just and then it

because you're at 20 to1.

>> Yeah.

>> Right. And you're at least more than one

to one on the front end. So like why

like why not is it just you just can't

as soon as you spend more just goes to

zero like

>> So yeah the issue is is that we have

fulfillment those months after that we

still have to cover. So like they pay

for the quarter in the first month and

then we have to pay for fulfillment in

months two and three.

>> Uhhuh.

>> Which is completely it costs roughly

like if we get them all

>> give me that number

>> that would be for the fully that's what

I'm saying cost of goods. So give me the

fully loaded before you get the next

payment.

>> Got it. Yes. Okay. So, um, for each

customer on the existing round, it's $14

>> or per pickup per month, right?

>> So, it's $14 and you're going to pick it

up three times.

>> We have three pickups per week. Yep.

>> Wait, hold on. It's 14. It's 14 hours

per month, right?

>> Yes.

>> Okay. 14 hours per month and they're

paying quarterly.

>> Yes.

>> So, it's times three, right? So, it's 42

bucks in costs for the first month of

delivery. When I say delivery, I mean

like fulfillment, right? And your CAC

is, we'll call it $70,

>> right?

>> So, if we get upfront cash over call it

120 bucks,

you could be good to go,

>> right?

>> Well, then let's solve for that.

>> Yeah.

>> Okay.

>> Pull it out of me.

>> No, you're good. I mean,

That's why we're here. Okay, cool. Let's

come over. Let's Let's break it up.

Let's figure it out. What order do I

want to do this in? I think we need

So, I think what we're going to do is I

think we're going to go avatar. I want

to get clear on this because I think

that's super important. Two is I

actually think we're going to go offer

next. We have to figure out like how

we're going to, you know, do it,

>> uh, you know, facilitate the

transaction. And then once we know that,

then we can do acquisition channel. And

then I think we can go ads

and then we're going to go sales

process.

We'll do some funnel funnelytics. I

think that's it. I think that's what we

need to do. Okay.

>> You're at that in that stage where like

I like having one avatar, one channel,

one product up to a million dollars or

more, right? And you're kind of you're

right there, right? And so you have two

avatars and like five channels

>> pretty much,

>> right? Yeah. And so you feel spread

thin. This is me just hearing you out.

And so what I want to solve for is we

have to make this decision between HOA

and scatter. So if you could just do

one, which one would you do?

>> I think HOA is a better opportunity.

>> Okay. I'll tell you I'll tell you why I

don't like either of them.

>> Okay.

and then I'll tell you why I like both.

Okay? All right.

>> So, the reason that I don't like HOA is

I never want to have a commoditized

service where I get into an auction

>> because then it's always just going to

be raced to the bottom. Now,

>> the reality is that that's not going to

change. And so, it's like what business

are you really in, right? And so, the

business that I think you're really in

is the efficiency business. So

fundamentally like if you if if 70% of

the market is owned by HOAs and they

continue to gobble more and more you

know more of these houses continue to

glob together then it's kind of an in uh

eventuality right that happens. So

figuring out the HOA offer I think makes

sense from a future proofing

perspective, but the strategy of the

business has to be geared towards

efficiency because it's the only way

you're going to beat the other players

because I agree. I think they're going

to commoditize you and I think they're

going to make it lowest lowest bid

fundamentally. The reason that I like

scatter in the short term is that you

can price more aggressively. You can

higher gross margins. You can outmarket,

you know, your competition. There's

still a decent amount of market share

that's there, but and acquiring them is

super easy. If you just knock on 12

doors and get a sale, it's like, all

right, well, how many doors do you need

to knock on?

>> That's true.

>> It's like very straightforward.

>> Because like taking it to the

hypothetical extreme, it's like, okay,

>> what stops me from running an ad,

getting 10 guys, getting them into a

room, taking a day to have them, you

know, to train to train them, and then

all of a sudden I've got 10 guys doing

five or five to seven sales a day, all

on contract with no risk.

>> That sounds relatively appealing. And

the nice thing with doortodoor is that

they already naturally have a route,

right, which you already know. And so it

it makes it even more efficient for the

business right on the back end. So

that's what I like about scatter, but I

do think that there's, you know, long

long term there's there's probably some

downside risk or sorry. Yeah, there's

some risk. The HOA I just feel like

you're going to continue to get

squeezed.

>> Yeah, that's the only So you're like,

okay, well then which one should I do?

You mind if I add something?

>> Yeah, go for it.

>> I think that the thing with scatter

that's even better, too. And the reason

I said HOA was not really because of

>> Oh, you're good.

>> Like the I like I like HOAs because I

think that the competitor that we have

right now that's really aggressive is

really going hard scatter and no HOAs.

So like it and then a competitor that

only does HOAs, we recently acquired so

people are unhappy with them. So then it

kind of opens it up for me. But the

thing I love about scatter is what you

said about pricing and then also the

fact that it's only once weekly

collection. So we increase throughput

for each truck.

>> Mhm.

>> So that's the thing I like about it. But

in terms of you know me being one I

guess I'm just thinking about it in a

limited sense where I'm I'm like I'm

only one guy. How many doors can I knock

on a day? You know

>> it's not going to be human.

>> Yeah. Exactly. Yeah. So we just I mean

let's think of it this way. You said

when you get to 3,000 doors is when

you're like super profitable, right?

like it becomes more profitable.

>> Yeah, we have.

>> And if we get to $5,000, then you're

like,

>> we're good.

>> You're Yeah, you're good.

>> Well, I mean, in my mind, I like to

think like if I had to take this to its

natural extreme, and I only had have one

thing be true, cuz I like I like to like

make a plan on like the fewest need to

believe is possible. Like every single

new assumption that we introduce like

dramatically decreases the likelihood

that it occurs. If I said, "All right,

do you think it's humanly possible to

get 10 people to work on commission to

knock these doors

and get to let's say conservatively five

a day right now? This guy's going to

keep getting better. He's three weeks

and he's already doing seven. Fine." But

like, let's just say they stick to five

a day.

>> Y

>> that's 50 sales a day. It's 1,500 a

month. You're looking at $20,000 by the

end of the year.

>> That's

>> right. And so to me it's like okay well

that overshoots our goal by like you

know 8x.

>> So

there's all these things that you're

doing but if it was like if only that

one thing were true then what are the

other need to believe that are

associated with that which is that you

can find the houses to do these door

knocking on.

>> Do you have the ability to do that?

>> Yeah.

>> Okay. So knowing where to go is not a

problem.

>> Yeah.

>> And so basically your ability to solve

two things. one is the cash to pay the

salespeople that they collect as much as

you owe them and that you can cover the

cost of the first, you know, the $42

that we went over earlier.

And so, like, if the only thing you did

was like you went home and you were

like, I'm going to go find 10 dudes and

they will be commission only and I will

just rejig the offer so that I can get

$42 plus what I have to pay them

upfront.

We don't have to talk about anything

else.

>> Yeah.

Let's do it.

I mean, like I can go through like I can

look at the ads and I can tell you what

I think like could be better. I can tell

you why the the which you know, we can

go through some of those things, but

fundamentally like I just want to be

like here's the ramrod. Like if only

this were true, then what stops me from

doing that? Not a ton, which is just the

offer and getting the sales guys on.

>> Yeah.

>> And then after that's done, it's like

that's it.

>> Yeah. And then we just and then we just

jam it and then you just don't let

yourself get distracted,

>> right?

>> I will give you my my blessing on if you

get an inbound HOA, you can close them.

>> But I still would be like this is our

growth strategy. I mean, like, yeah,

sure, except for money provided it

doesn't there's it's super operationally

efficient. It does take some of your

time. Fine. You're the owner. You can

close big deals. But by and large, I

think that's the play.

>> Okay. All right. Great. So, I think we

go scatter.

[Music]

Great. That was decision number one.

>> Yep.

>> Now, acquisition channel, you already

have 50% coming from door to door. So,

that gives us that one. Right. So, I'm

going to hit the sales process in a

second, but I think we need to go on

offer because this is kind of the big

the big unlock of this business. All

right. So,

we have to get You said you're going to

pay them 50, right?

>> Yes.

>> Okay. So, here's how I would restructure

this.

I would say we have to get $42 no matter

what. Period. Because that's what it

costs. That's hard cost, right? So, this

is base. Then got to get the sales guy

paid. So, I'm just going to put

commission here, which we can fill in in

a second. So, we kind of backfill that.

Okay. We have to get a commission and we

have to get the contract, right? So,

what I want to do is find something. So,

do you give them all a new bin or can

they get like a do they get like

somebody else's bin or like how does

that work?

>> We recycle the bin. So if someone like

the three people who canled then we'll

but for the most part they're new bands.

>> They're new bands. Yeah.

>> Okay.

>> And we'll finance them over 3 years.

Before I bought them with cash, but then

I'm like, "Okay, maybe we should

probably move on to more cash."

>> You wait, you used to pay for them in

cash. You finance them.

>> Now I'm financing. Yeah.

>> And do the customer is that $14 per

month including included?

>> Yes. Yes.

>> How much does it cost for a bit

>> for the set including freight? It's 116.

All right. So, it's 116.

Okay. Now, so this is Ben.

What else can you sell up front?

Bulk pickup maybe.

>> Um,

>> but the only How many What percentage

customers like opt for that?

>> That's also seasonal and that's

>> So, no, that's not the offer. Okay. What

else? So, I'll tell you I had this idea.

So, we talked about the QR code earlier.

Mhm.

>> So, what I was thinking about doing was

like you put the just the ugliest

massive QR code on there and you just

say, "Hey, if you want to not have this

big QR code on there, it's it's an extra

five bucks a month."

>> Or if you're cool with it and you're

still like cool with us advertising the

business, you allow us to leave it on.

>> Okay. And I think a lot of people don't

give a [ __ ]

>> Yeah.

>> Right. And so all we're going to do

though is just tack that on to your

existing pricing. So you're So if they

say, "I don't want the QR code," then

they're going to pay $5 more than your

existing price.

>> So they're we bake in a little price

increase there.

>> So we get $5 for the QR code.

So go buy stickers. They're like not

expensive.

>> And just put this massive QR code and

put your phone number and put your like

you've got this you've got this

billboard that's just sitting out there.

What color are the bins?

>> Gray.

>> Man, I totally want them to be neon

orange. I'm dead serious. I I would want

everyone to be like, "Jesus,

>> what is this company?" But they would

notice it, right? I mean, that's what

you're trying to You're trying to know.

>> Yeah.

>> You said, "Wait, didn't you say you

wanted the branding? You wanted to be on

brand with the gray."

>> Yeah. People, we're like clean and

stuff.

>> You think gray's clean?

>> It looks You should look at them. They

look pretty clean. We have people

calling in like, "I seen your clean."

>> They're so gray. It's like the perfect

gray. It's like a light gray. 50 shades.

Anyways, um Okay.

>> Okay. This is this is the this is how we

break this is how we solve the business,

right?

>> So like let's take the time on this. The

other stuff is really easy. I'll show

you some easy like I don't like I can

get into ads. I can get into the funnel.

>> Like if we just do this, we win.

>> Yeah.

>> Okay. So you don't charge them anything

for the bid, right? As far as they're

concerned,

>> we do have a separate process through

our website. So, we at the door we have

that offer that I mentioned, but then

when they go to our website, enter in

their address and everything and they're

qualified. They do get charged a $37

initiation fee and then they get charged

35 a month.

>> Mhm.

>> So, we have a little higher price point

if they don't take advantage of that,

but most people do the door to door.

>> And so, this 42 is labor, right?

>> Yes.

>> Labor plus truck breaking.

>> Yeah. And dump fees.

>> Okay. Yeah. Plus dump. Okay. Got it. I

think our key is actually how we

structure this the bin. So it cost you

116. Is there a way that we could be

like

because what I want to do is you see

where I'm going with this, right?

>> Yep.

>> Cuz like if we can get the first

transaction to be like 199, you're

covered, right? Because you've got like

So if we add this together, we've got

158. So 158 is the true like cost cost,

right, of of getting this person set up.

Then you have the commission which is

50. So 208 all in. If we got that,

you're like,

>> "Yeah, set."

>> Yep.

>> Right.

>> Something I've been playing around with

is maybe doing only doing the 3 months

free if they pay annually upfront.

>> Yeah, totally.

>> And then like downell to the 89 a

quarter with no months free.

>> Mhm. I like that.

>> Yep. I like that because even the rate

is really attractive. But the I mean the

only negative about that is sometimes

they're like, "Yeah, sure. Let's do it."

And then they opt out because their

current provider matched it, but then

the 3 months free usually is what puts

them over the edge because the current

provider will not offer the three months

free. But out of those that do that, I

would say it's only maybe one and eight

would really

>> Oh. Would um

>> would like after we like, "Okay, it's 89

a quarter." And they're like, "Yeah,

actually my current provider matched

it." So it's like one in eight people.

>> Most people are just like, "Here, just

take the business." Yeah.

>> Yes.

>> Yeah. So, if we get if we get the the

deal on seven out of eight, who cares,

>> right? Great point. Yeah.

>> So, if we go

what I'm trying to play with is so we've

got the what what levers do we have?

Right. So, levers we have this little QR

code like we're going to make your thing

look ugly. That's thing one. Thing two

is we have the bin. Thing two, we have

thing three is we have the commitment.

Right. Right.

>> These are this is like what we're these

are our puzzle pieces. Okay.

But I want to collect 200. That's what

I'm trying to do.

>> Mhm.

Okay.

So, a quarter is 89, right?

>> Yes.

>> Is there any reason? Do you think

anyone's going to bulk at 99? 89 to 99.

>> A lot of people are paying 105, so it

may not get them over the edge.

>> You mean it's not enough savings?

>> Yeah.

>> I hate being low low cost. Okay. But I

think that there's still some people who

would definitely convert cuz like

there's some people I talked to who are

being charged like 180 a quarter.

>> Yeah.

>> It just all varies, you know, depending

on if you if you call them to say, "Hey,

lower my rate."

>> So 80. So okay, so we got 9090 is 180,

right? In terms of cash, right? There's

going to be some setup fee, right? Which

we could say we have a 42 and we also

have set up fee, right? So it's another

little little thing.

>> We're just we're constructing an offer

right now. That's literally what we're

doing. Okay. Um cuz you could do 3

months free and it's 33 per month,

right?

>> You could still do three months free.

Yeah,

>> that works fine.

>> Oh, here we go. So, we can basically

have the QR code be our $5 extra a month

>> and you're at 29. So, that gets you to

35.

>> Okay.

>> Right. Or you can make it Yeah, that's

fine. So, that gets us to $35

per month, right? And so if we did time

six,

then that's going to be two

is that that's 30 + 180. So 210. All

right. So it's going to be 210 in cash.

And if you commit to six,

and you normally just eat this, right?

>> Yeah.

So, if you commit to six, we'll give you

our $116 bin

for free

and we'll wave

our

$49 setup.

>> So, can you talk a little bit more about

these these numbers right here?

>> Yeah. So, this Yeah. So, $35 a month is

the the price, right?

>> Yeah.

>> But what we're trying to do is get them

to prepay for six months.

>> Okay. So, that's the main offer is you

prepay for six and then that gets you a

free bid and we wave the setup fee.

Okay? If you don't prepay for six, you

can prepay for three and we'll give you

actually maybe we'll just do this. We'll

do this. We'll do 12 and we'll step down

to six and then we'll step down to

three, which is your current offer.

Okay? So, 12 months gets you cuz what

we're looking for here is blended

average cash per door. So if you have

some people who pay 420 and even if it's

like one out of whatever one out of five

pays 420 we're still effectively adding

80 bucks per door in cash collected.

>> Okay.

>> So even if the vast majority of people

if everybody took or if four out of five

took the your current offer and then one

out of five takes the 400 it's like

we're still adding 80 with the existing

whatever 89ers that that you're getting

right now. So now our actual blended

average is close to like 170 a door.

>> Okay.

>> Does that make sense?

>> Yeah. Yeah.

>> Okay. So I think we go times this. Now

if they're like I don't want the QR

code, then we're like fine. We'll drop

it to 30, right? If they don't want this

>> and times 12. So that's 360

and we get that up front which is going

to have lower return anyways. If they

say no, I don't want to do that, then we

say because with that you get free bin

and free wave or like free free setup,

right? If they say no, I'll just do six,

which would then get us the two whatever

the $200ish price point. We can get to

we can finalize the price is in a

second, but you get your $200ish price.

Um, and when you do that, we can't wave

the bin. We can wave the setup fee, but

we're going to add we're just we'll

finance this over the duration. So,

that's where you can get the difference

in terms of the like it's $35 a month if

you do 6 months, it's $30 a month if you

do 12 months.

>> Um, and if you're doing just

monthtomonth, if you sign up today, I'll

let you wave this fee, but you still got

to pay three.

>> Okay.

How does that feel?

>> Complicated.

>> Yeah. Well, no, no, it's complicated cuz

we had to go through everything. But let

me let me let's clean it up. Okay.

>> You got to be able to explain it to the

sales guys.

>> Yeah.

>> So, the offer at the door is going to be

12 months.

And what price are we going to charge at

12 months?

>> For 12 months being 30

>> up front.

>> Up front. So we're going to do 30. So

that's going to be $360.

>> Yep.

>> If they commit to 6 months,

that's going to be at 35.

>> Okay.

>> So that's 210.

And I would say we build by bill twice a

year.

>> Mhm. and then three months.

Do you do a

>> We just incorporated that actually.

Yeah.

>> Okay. Do you have a processing fee?

>> Yeah. So, we Stripe, so it's um

>> No, but like do you you don't charge a

processing fee?

>> No. But we like I've gotten a bunch of

people to switch over. I like offer them

a gift card, like a small gift card to

switch over to a but then we don't do a

>> Well, I'll tell you really a fancy one.

So, say that you charge the 3%. So, this

is all these are plus processing.

And then if they're like, "Oh, I don't

want to pay the processing fee." It's no

worries. If you want if you have a

second form of of payment, we'll wave

the processing fee. It's just because we

have the processing fee just cuz if the

card declines, we it just takes us work

to go redeem it and then you get your

service interrupted and you have trash

sitting around. So, it's honestly in

everyone's best favor. It's like

honestly, no one ends up paying it. They

just give us two forms.

>> Oh, thanks. the um so I did actually do

that and when I got the uh the prices

book that you gave at the workshop and

>> so I kind of messed it up. I did like

two things. I did like an annual fee and

then and then I also mentioned oh yeah

we're also doing a credit card fee which

is really I was just

>> too much too many things. Yeah.

>> Yeah. But I did that and just I was

looking into how to add the processing

fee and like you have to like go to

Mastercard and Visa and all that stuff

and is that true or like they're they

were saying like you have to legally go

to these companies.

>> Oh, I I I don't I think you can just

charge 50% more.

>> Oh, we can just do Okay. Okay.

>> And just say this is our fee.

>> Okay.

>> You can charge whatever fees you want.

>> Check with your legal counsel. Okay.

Great. Uh and then three right now we'll

keep it at um

we'll keep it at the 3month rate which

is going to be 35 right

>> which is 10

what is that 30 105

>> right

>> but we'll still wave the $49 fee

>> okay

>> this one wave is waves bin and fee

I think right that we

Yes.

>> So this gets the discount. So this gets

you the discount and the bin and the

fee.

So it's like what like how why is it? So

it's like the effective rate here is

a 30

35

and then here it's also 35

but

bin. How are we going to how are we

going to do the bin? How are we going to

work that in?

We're close. This is honestly the most

important thing of today. Like we nail

this. You go all in on door to door.

>> We can get there by the end of the year

and you're set. So I just want to like

make sure we nail this. What else do you

think is so with the bin? Are you saying

that they pay the full 116 up front?

>> I would love that.

>> Okay.

>> But like for this one, I guess because

this is not waved with this with this

offer.

>> Well, what if So, if you didn't have the

bin, right? What would their actual rate

be? So, what do you charge people who

don't who provide their own?

>> Yeah, the bin is like a few if you I

mean depreciating it over its use.

>> No, not the depreciation.

>> Okay. I mean like Well, what Okay, fine.

You you depreciate over what? Three

years. Is that what it is?

>> They have a 10-year warranty on them.

So,

>> so 10 years is we depreciate over.

>> So, you paid it's like a dollar a month

or something like that.

>> A few cents. Yeah.

>> Yeah.

>> Yeah.

>> How is it a few cents?

>> Yeah. Cuz over like

>> Well, 116 months.

>> So, am I doing that wrong?

>> Yeah. It be it'd be it'd be dollars.

Yeah. Maybe doing that wrong.

>> Well, 12 months time 10 is 120. It's

$116 bet. So, it's 90 whatever cents per

per month.

>> Okay. So, it's a dollar. It's a buck.

>> They don't know that you do that though.

No. So, that's the thing. So, like

that's like that's that's one-sided

information. Don't worry, we'll cut most

of this thinking time out to figure it

out. No, but I want to I I think the

magic is in this bit. I actually think

that that's I think that's where the

real leverages.

>> Okay.

>> It is something I've been wrestling with

cuz initially when we were doing it and

we didn't have the competitor, we were

like charging 99 for like and they were

like, "Okay, fine." But then some people

bulk at it and I'd be like, "Okay, fine.

We'll wave it." But most people would

pay for it. Um, but now that it's really

competitive, they're just like, I'm

gonna go to this other guy who's giving

me three months free, 89, and I just

have to pay for the quarter. So,

>> yeah.

>> So, it's become a little bit more

challenging in that sense. Doesn't mean

we can't do it.

>> Yeah.

>> But that had that has been something I'

I've done in the past.

>> Um, I think most people were I kind of

played with 99 and then I went down to

50 and most people were like they didn't

really care about 50 as much. But then

like when I did

>> cuz I like So I like I mean you're

currently charging nothing. Yeah.

>> So, if we said, "Okay, up front we have

a $49 bin fee, right?" Yeah.

>> You can buy the bin for 49 bucks. We

know that it doesn't matter, right?

We're just adding adding money. So,

might they'd be like, "It feels

reasonable, right? $49 bucks for the bin

and it's $49 initiation. I don't know.

I'm just coming up with this. Okay. It's

$49 initiation."

And then you have your first quarter,

which is, let's just use your old

pricing. Mhm.

>> 89. So that would get us to 190.

We still have commissions.

>> Yeah.

>> But this bin isn't a real cost cuz it's

going to cover towards $42 for the

quarter

>> that we're we're calling it the bin fee,

but it's really covering our labor

>> for the first quarter.

>> Right.

>> That's clever. Yeah.

>> And our initiation is actually our

commission.

>> Mhm. Mhm. I gotcha. Yeah.

And then our 89 is hopefully our margin.

This feels okay. Do you think you can

sell this?

>> I think I think people will be really

upset with the extra 49

>> the initiation.

>> Yeah. I think they understand the bin.

>> Well, why don't we do this?

>> Yeah.

Like we can either basically Would you

think they'd be more comfortable paying

99 bucks for the bin

>> and they own it?

>> Yeah.

>> It's your bin. You keep it forever.

>> Yeah.

>> Unless you cancel, of course, in which

case we take it back.

>> Yeah.

>> Yeah. I mean, I think that

>> I'm just like replaying anecdotal

experiences and

>> take your time.

>> I'm just worried people would be like,

>> "Yeah, it's that's a dealbreaker for me.

like I I won't pay that for for the bid

even if I own it. I just don't want to

have to provide it.

>> Yeah, but what percentage?

>> You're right. I think it' only be like

25% or something. I just always remember

the negative, right?

>> Of course. Yeah, I get it.

>> Yeah. The thing is is all the new sales

guys coming in aren't going to know

anything in terms of like what status

quo is. So, you're like, "Here's the

deal, guys.

>> Like, you're going to get paid 50 bucks

on each one of these."

>> Mhm.

>> And you got to you got to collect two

things. You got to sell them Ben. They

got to pay their first quarter.

>> Mhm. That seems pretty straightforward.

And we can wave the initiation fee.

>> Yeah. And and we still do the three

months free with this or no?

>> Yeah, I think you can still do the three

month the three months free.

>> Okay. I don't hate that.

>> And dude, just to clarify for myself. So

the bin it's actually theirs now. So

they're actually paying for it.

>> Well, it's 116, right?

>> Yeah.

>> Yeah. So why not? Now if they if they

cancel before their term,

>> you take the bin back,

>> right?

>> Which gives you another piece of

collateral.

>> Yeah. Okay.

>> So all and you lose 16 bucks on the bin.

Who cares? But like

>> Yeah. Exactly. So I think I think if you

go you sell them the bid you have this

um you have the first three months right

first

quarter

and we're we're in good shape with that

and this factors and then you have you

give them one free month the next each

of the next quarters.

>> Yeah. And then that means that you're

charging them what? 60 on Q2, Q3, Q4.

>> Exactly. 59 and some change.

>> Got it.

>> And so how do we handle situations where

they we're like, I'm not going to buy

your bed.

>> It's like you can provide your own.

>> Okay.

>> And so we just wouldn't accept them as a

customer.

>> Yeah. I mean, you can provide your own

if you want.

>> Yeah.

>> Okay.

You could, if you wanted to, say, "If

you're not willing to do that, we'll

finance it over three years, but we end

up charging you 150."

>> I like that. Yeah, I really like that.

>> Because then it gives you a three-year

term.

>> Yep.

>> Okay.

>> And then with the three-ear term, budget

in like, I don't know, add in like a I

don't know, 4% price increase each year.

>> Okay.

>> I think that's it.

>> Feels doable. Yeah.

>> I still want to get this anchor though

because we still want to cuz some houses

are like fine, just [ __ ] build me

once. I don't I don't think about this

again.

>> Exactly. Yeah.

>> Yeah. And so it's like start at 360.

It's like yes for the year. Okay. So

we're getting close. We're going to do

we're going to do a cleaner a cleaner

next version of this. All right. So all

right. I want to think through it real

quick. So this is the core offer, right?

We'll clean this up. But it's like 99

bucks for the bin, 89 for the first

quarter. You still get your three months

free.

>> Mhm.

>> Cool. That's fine. I still want to start

higher because even if we get 20% of

people to take, which we totally will.

I'm telling you, we're going to that

would be really big for the business

because if we can get this on the core

offer and then we can add 80 to the

average door.

>> Mhm.

>> Then that takes this uh So this is 190.

Add 80, we're at two We're 270,

>> right?

>> Average cash collected per sale.

>> Mhm.

>> You're good.

>> Yeah.

>> You're home free.

>> Mhm.

>> Sexy, right?

>> It's way better than right now.

>> Yeah. It's way better than right now. It

is way better than right now. That's

this that's that's facts. FA FA, you

know, it's fashionable printer. Okay.

Okay. Okay. So, here's here's where this

gets sexy. I got it.

>> Okay.

So,

all right. Okay. I think this is coming

together. This is coming together. If

someone If someone paid 360 up front,

would you give them the the bin for

free?

>> I think I do that. Yeah.

>> Okay. Boom. I think we're just going to

have two offers. Okay.

>> Keep it super simple. We're going to

have 12 months

and with 12 months they're going to be

at $30, right? And they're going to pay

$ 360 in total but free

$99 bid.

So they don't have they don't have to

pay that,

>> right?

>> Great. And then the core offer is going

to be three months

at 30,

but they have to pay for the $99 bin

and 3 months

upfront.

>> Mhm.

>> So all in they're looking at

180 190 whatever 189.

So now look at that AB offer. Yeah. So

would you rather pay 360 pay for the

year? I'll give you the bin. It's on me.

or 189, you just pay the first quarter,

but you just got to pay the bid, right?

>> Right.

>> Yeah. I like that.

>> Then we just got to hustle.

>> Yeah. The nice thing is that this keeps

it super simple. The billable is the

same. All we're debating is who gets the

free bin and who doesn't. You get the

free bin when you commit for the year.

Cuz listen, it costs me money to do

this, but if you commit for that period

of time, I'll throw it in. Right. Like

it actually costs us 116. So like I'll

be like we we actually lose a little bit

of money on these bins.

>> Okay. Yeah.

>> But if you commit to us, we'll commit to

you.

>> Yeah. Exactly.

And then our breakdown is let's say now

let's look at the math. So let's say 80%

take our

189

offer and then 20% take our 360 offer

equals

$72

and this equals surface says Michael

Jamie

>> Jamie the

>> well it's 19.2

2 is 270

is $27 off this which is

$162.

So we add this together

average per door

and we need a 208.

Yeah.

And then you're home free.

>> Doable.

>> Yeah. I just I've never thought about it

that way.

>> You still get three. You still get

three. Like the offers are banging.

>> Yeah.

>> It's like you get three. Like the offer

is great because you're giving three

months free either way. Yeah.

>> So I would that way I think you've got

this great feel, right?

>> You say, "Listen, we're going to give

you three months for free either, right?

Just because you're switching to us. So

we're happy to do that. But if you're

willing to commit to a whole year, give

you the BI,

>> right?

>> If you don't want that, no worries.

>> We'll get you set up. Yeah.

>> Yeah.

>> What are you going to do? What are you

going to do with all this money?

>> Yeah. I don't know.

>> All right. So, that's that's the that's

the play. That's the play. Okay. And for

for our folks at home, the reason that

that was so important is that we needed

to get above $28

because he had a $50 commission that he

has to pay.

And we knew we had $42 of labor

and we know that he had these bins that

he's been basically fronting the cost

for for customers. Now, to be clear, as

of right now, what was the other cost,

though? There was nothing else. There's

labor, there's commission, and there's

something else.

>> No, I think it was just the bins.

>> Oh, so I'm just being greedy. That

works. Okay. So, then we got Yeah. Yeah.

Well, I like to have I like to grow

businesses debt that free

>> if I can. Me, too.

>> Because I just think there's there's

always a way if you just think about it

hard enough. And so, the bench, which

right now he's been financing over 10

years for $116. But when we add all

these things together, we get to 208.

And so in a perfectly debt-free cash

flow positive way of growing the

business, we have to get on average over

$28 to to break even up front and have

really high really strong cash flow for

the business, which has been the biggest

constraint for you. So getting above

that is the objective. And so what we

did was we solve for it by having an

anchor on the top that we know 20% of

people are going to take and that

contributes an extra $72 a door where

the core offer is going to be 190 which

already solves this.

>> Mhm.

>> Cool. So that's for everyone back home.

Okay. Now let's go back to our our handy

dandy. Isn't this fun? It's a lot of

fun.

[Applause]

Okay. So, we have our our new offer, our

360 for 12 or 12 at at 360. And then we

have our 3189

money. And if you really get wild with

that and you're like, you know what, I

don't need all the extra cash flow, you

can pay the guys 100 bucks a day. 100

bucks a deal.

>> Mhm.

>> And they'll be willing to sell more. If

you're like, you know what, I don't need

all the C. Like, I'd rather just get

more aggressive on the spend. You can

get way better guys if the guys can make

I'll tell you the difference in salesman

that you can get at $500 a day, $15,000

a month, almost $200,000 a year, like a

different an order of magnitude better

saleserson.

>> And the thing is those guys might be

doing like and that order of magnitude

better salesperson might do 10 deals a

day.

>> Yeah.

>> Because the guys who really do door to

door, they run between doors.

>> Really? Okay.

>> 100%. Okay.

>> Because they know it's a numbers game.

Yeah.

>> They're like for every 12 doors I knock

on, I'm going to get a sale. So if I

run, I mean, that's why the UPS guys,

like the guys who who are who are

commissioned and are really understand

the game, they sprint back and forth.

>> Mhm.

>> Because you can cover four times the

doors just by walking fast. They cut

across the lawn. They don't go on the on

the sidewalk like they're moving.

>> Mhm.

>> Okay.

>> So, we're going scatter. We're going

door to door is our channel. We have our

offer, our 12, our AB offer, which is

great. The extra guys get the bin.

Awesome. And now we don't even have to

have a financing partner.

>> Yeah.

>> And if you want you can and just collect

the cash,

>> right? The the next thing is let's talk

about sales process

>> on how we're going to teach these guys.

>> Okay.

>> Okay. How do you teach your guys right

now? And what's the sales process?

>> Pretty relaxed. I mean, he's the first

guy I've done. So, I just I just take

them door to door, show them how I do

it,

>> and I generally tell them right next to

you.

>> Pardon me?

>> He's right next to you.

>> Yes. Exactly.

>> Okay.

>> Yeah. And then I'll do that for a few

times. Show them how it works. show him

how to get a few sales and then I watch

him do it and let him just kind of go at

it and then chime in if I need to and

then eventually just kind of like give

him critiques wherever I see.

>> How many doors can you knock a day?

>> I think I think easy like uh 150.

>> Okay.

>> If you're out there for 8 hours. Yeah.

>> Yeah. So 150 doors. If he's closing I

mean if he if he gets to what you're

doing one out of 12.

>> Yeah.

>> Right. Then he's closing more than 10

deals a day.

>> Mhm.

>> Which is chill even at 50. That's what I

hear on average like conservatively you

can get 10 but most guys get 15.

>> Yeah.

>> Yeah.

>> So the nice thing with your business is

that you're going to be in person with

them. And so you you there's basically

two primary ways that people learn. One

is modeling and the other is basically

doing it. So children learn through

modeling. They watch you do something

and then they learn it. Right?

Alternatively you take it up a notch

when you give feedback. And so doing

role plays like in very real time with

them is going to be the fastest way to

speed up the loop.

>> Okay.

>> So it's literally just like have the

door at your facility or whatever. Like

I mean you want to you really want to

get them in the like in the mechanics of

I say this as the door opens. It'll it

will teach them like don't just stand

next to them like close the door, open

the door, close the door, open the door,

close the door, open the door until they

just nail it every time cuz you know the

first 5 seconds of them opening the door

is like that's the only shot you really

have and they're making their

split-second decision. And so it's like

you have to drill the opener super hard

so they can just say it in their sleep

and they say it the right way every

time. But they should absolutely be

following a script. And for this type of

sale, this script should I mean how long

does it take you to do a sale for these?

>> 2 minutes.

>> Yeah. Right. So they're not super hard

sales. And so the sales script is going

to be like four questions. It's not a

lot. Yeah.

>> Right. And so it's just like

>> cool, here's our door, here's our knock,

here's our open, and then question one,

question two, close question overcomes.

Like that's it. And so I just drill.

Honestly, the drilling the three or four

questions is not going to be tough. Then

you're just going to do traditional

sales training where you're just going

to be like, I have to think about it.

I'm not sure. I have to check with my

spouse. Like, oh, I don't have the the

card that I want on me.

>> Yeah. And when you're when you're

collecting, do you have a lot of people?

Do you have any people who are like, "I

don't have the card that I want to use

on me."

>> So, we actually don't collect money at

the door.

>> Why? We have a contract that we signed.

>> Okay.

>> I heard that it was uh I don't know. I

just heard that it was you have to have

certain permits to collect money at the

door. So, then I don't have that permit

yet.

>> But they put a credit card number down,

right?

>> No.

>> What? And we're still get but people are

still

>> what% what percentage of people who sign

contracts don't end up giving you the

card.

>> Uh none of them really they

>> if we haven't I mean we haven't done the

volume we're talking about right now. So

I'm sure there would be a ton of people.

>> Okay.

>> So you then call them back later?

>> I send them an invoice and then if they

don't complete it I'll follow up and

>> and everyone pays.

>> Yeah.

>> What are we doing? like

we should be selling we should be

selling trash. What are we doing?

>> Well, they need it. Yeah. I mean,

>> yeah. Well, if it's not a constraint,

then I'm not going to mess with it. But

I do think you probably tighten the

sales process in terms of the training.

>> That's absurd. Uh what you just said. I

I don't know in terms of compliance for

that. So, check with an attorney. But

I'm I'm pretty sure you can just ask

someone to buy something.

>> Okay.

>> I'm like pretty like

>> feel pretty confident in saying that.

But but but

>> you know, it hasn't been an issue. And

so if you really do collect 100%, it's

certainly a less friction, a lower

friction sale,

>> but a contract without a payment clause

means nothing. So

>> yeah, the fact that you're getting it is

great. The fact that you're getting is

great. Okay, let's pull up the ads in

the funnel real quick. Okay, so

>> yeah, just go just go funnel. Sorry,

ads. Sorry.

Okay, so I think I think this is fine. I

read the copy. I think it it it checks

the boxes in terms of a normal offer. Uh

the video ad that I saw that was your

best performer was unsurprising to me

that it was the best performer.

>> Bottom link.

>> There you go. If you're a homeowner in

Centerville, Chantelli, Clifton, or

Fairfax, and you want to save hundreds

on your trash collection this year, this

is for you. My name is Philip and I'm

the owner of Garpy Disposal Services.

We're a local familyowned and operated

business in the Centerville area and

we're here to help take care of your

trash. So, if you're tired of things

like increasing bills every year, crazy

prices, unreliable pickups, then we

might be the ones for you to help give

you some more consistency, ease of mind,

and stress-free trash collection. If

that sounds good to you, click the link

down below so we can give you a quote

for trash collection in your area so you

can start saving money and stop worrying

about your trash collection.

>> It's so cringe.

>> No, it's your highest performing. Yeah,

the thing is it seemed authentic. That's

right. And it also hit the the core

pieces is like

>> this is for so and so. I do think you

introduce yourself first rather than

talking about them. But

>> okay,

>> like you can you can I would probably

make it offer driven first pain pain

pain of like hey what you said at the

end like hey if you're tired of XY andZ

blah blah blah I'm so and so okay

>> because it's like leading more with the

things that they're interested in. And

so basically I would just flip the

script on that and then I would record

10 different versions of that with you

in different shirts in different

backgrounds with the truck with a bin

behind you with a neighbor behind you.

Like I would just do as many variations

of that. If I was going to do paid ads,

but we're not going to do that because

we're doing doortodoor. So you just cut

it off completely.

>> I just don't think you need it. I think

all of your attention should go to I

need to get 10 guys that are commission

only that are going to sell this offer

>> and just only focus on that.

>> Yeah,

>> that's it. I mean like if we only have

one thing to be true in order for this

business to be profitable, then let's

just pick that and then just put all of

our effort on that one thing.

>> I mean fundamentally it's the idea of

leverage.

>> Yeah. is like find the one thing that

gives you the greatest output. It also

has no risk on cash flow for you

>> cuz they're commission only.

>> Yeah.

[Music]

>> The perfect solution doesn't ex

>> except when it does.

>> That was it. AV offer 12 month 3-month

20% take the 12 80% take the main. We're

cash flow positive on both. You don't

even need to go into debt for the the

bins.

>> You get 10 guys closing five deals a

day. It's 50 deals a day.

>> Yeah.

>> That's it.

>> Yeah.

>> And then

>> and it's way way easier to close in than

solar. You can probably get some of

those guys. They're just tired. It's

like, dude, you're like, it's it's such

a such a better life to to just know

you're going to close deals every day

rather than be like knocking doors for 5

days and closing one or two.

>> Yeah.

>> Like it's a much more, you know,

energizing way to live.

>> Yeah. No, for sure.

>> I think my next constraint would be then

getting the sales guys, right?

>> Let's talk about that.

>> Yeah. So right now, so I would say if

like you can handle more volume, right?

Do you don't have to really change

anything about your infrastructure to

handle the volume that you would be

getting from these sales guys?

>> I think after a certain point, we would

need to get another truck.

>> We'll deal with that. Yeah. Yeah. So to

get to your 3,000 whatever it was

number,

>> how much can you take if you were full

capacity? How many customers can you can

you handle?

>> I think we could do 3500.

>> Okay.

>> Yeah.

>> I mean like 3500 we had a,000 more

customers to sell.

>> Yeah. So you got to sell I mean in six

month let's call it five months. That's

200 customers at seven customers a day.

I mean you're if you get a second guy

you'll be doing that

>> right

>> in six months.

>> Could be me.

>> Yeah. Could be you.

>> Yeah.

>> All right. So yeah that's going to be an

issue because I mean do you have the

cash to go buy another truck?

>> I think I can figure out a way to get

one.

>> Okay.

>> Yeah. So the way to do it is I I think

that you could given the nature of this

job, I would be looking at running like

Indeed ads/craigslist.

>> Yeah,

>> that would just probably be the easiest

thing for you to do. And then you just

need to work these like it's a lead

funnel, right? And so like if you're not

getting people, so it'd be like like you

have to think about this like as a true

ad. So a lot of people try to like ward

people off. It's like dude, it's an ad.

It's the same thing. It's like you're

gonna run an ad, you have to have a

headline. It has to be appealing. The

cop the body copy has to be interesting

which is like hey you can work four

hours or eight hours a day. The guys who

work eight hours make this. The guys who

work four hours do this. Instead of the

other alternatives you have of like you

have to be able to ask four questions to

somebody at the door. Like break it down

to what they're going to have to do.

>> It's like if you can memorize four

questions then you could be able to make

a six-figure or multi6ig per year income

as long as you're willing to be in the

street. But then now do damaging

admission. It's like hey sometimes it's

going to be hot, sometimes it's going to

be cold. That's the trade. But if you're

somebody who's like just barely

graduated high school, we don't care

about your grades. We care about your

work ethic.

>> Yeah.

>> Like I think that would attract plenty

of people.

>> Yeah.

>> And so it's just add Indeed and those

ones already have kind of like applicant

funnels that are built into it. And so

basically if we're turning off all these

extra things that you're spending all

this like fragmented time on, this is

all you do.

>> Yeah.

>> You go get sales people.

>> Yeah.

>> And honestly all you need you need like

two guys just to get this going.

>> Yeah.

>> That's it. That makes a lot of sense.

>> PB offer two guys, four questions.

That's it. Let's go.

>> Yeah. I've been doing Indeed ads and but

I haven't been structuring it like that.

>> No.

>> Exactly.

>> It's been more just like the traditional

like corporate.

>> Yeah. But the thing is you have to think

about who's responding to this.

>> Yeah.

>> Write it to that to the salesman, right?

>> Cuz that's who you're trying to attract,

>> right?

>> Like what are all the things that you

either hate about your current job or

you hate about your current sales job?

Both those are the pains. What are the

what's the promise? you can make six

figures, you know, a year or more and

you can work four or eight hours a day.

I'll take you on either. So, some guys

will work, you know, 7 to noon or 7 to

11 and then they go to their other job

by noon and they work, you know, 12 to 8

cuz they're providing for family.

>> So, this is a great opportunity for you

>> and then work on that immediately. Yeah.

>> All right.

>> So, I'll give you the the truth about

this. So, for a job where someone's

coming in commission only, my bar is

relatively low because I'd rather give

more people the opportunity to take a

shot and like prove that they have work

ethic rather than they have the skill of

interviewing, which is a different

skill. I basically would just screen for

crazies.

>> No, I'm serious. I just screen for

crazies and because if you're going to

do this, you're probably going to get a

lot of applications. Definitely don't do

one-on-one interviews. You're going to

be doing group calls. So, bunch of

people on 2 minutes, tell me who you

are, 2 minutes, two, two minutes, 2

minutes, whatever. and then invite the

ones who seem normal to your, you know,

your warehouse or whatever. Meet them in

person, give job offers on the spot,

tell them when they can start,

>> okay?

>> I just don't think you have to over

complicate this. And so it's like, cool,

what we're going to do is we're going to

do shatter for a week

>> and then we're going to break you off in

twos and then that's it. Like you're

good to go. And the thing is here is

like if you wanted to like

>> this is this is me talking about how you

aggressively scale sales like you need

like two guys. So like get on a group

call, talk to a bunch of them, the guy

who seems cool and normal and

hardworking. Invite two or three of

those guys out because a bunch of them

aren't going to aren't going to last,

right? Because it is door to door and

there are there is some risk there. And

so like maybe it's hire five to get one.

Okay, just lower the bar. Like you're

not looking for somebody to cure cancer

here. You need someone to ask four

questions and be able to fill a four.

>> Yeah, definitely. Cuz I mean like I said

me, I'm not like the best salesman in

the world, but I can go up there and

sell.

>> Sure. But the thing is you seem

trustworthy.

>> You think so?

>> Yeah. Okay.

>> So,

>> and you're also the business owner, so

it's like I think that's a big

>> course. You have star power. So, but

with them though, I think what the the

one thing that I'm looking for is

hunger.

>> Yeah.

>> And so, I think that'll typically skew

to either young single guys who are just

like really hungry and like go-getters

or people who just are about to have

like a kid on the way like you are.

You're more hungry now than you probably

were.

>> Right. Cuz you're like cuz you have to

be.

>> Yes. It's like, you know why married

married men with kids make more money

than guys who are single without being

married and don't have kids?

>> Because they have to.

>> That's why they make more money.

>> I mean, yeah.

>> So, the they literally choose to make

more money because they have no other

choice.

>> Yeah. That's definitely how I feel.

>> Yeah. Right. And so, you're doing it.

So, basically like I just look for

someone's circumstances of like why do

they need this?

>> If someone's like hungry, then

>> I'm especially in a job like this, this

is so work ethic driven. They're not

going to run out of houses. Yeah, for

sure.

>> Right.

>> So, would you say I should just not do

any more door to door and just train the

guys?

>> Well, I think you I mean, you're going

to be doing door to door in the

training.

>> Okay. Yeah.

>> So, your sales isn't going to go down.

You're just going to have more people so

you can duplicate it,

>> right? Okay. Makes sense.

>> Two birds in stone.

>> Yep.

>> Basically, as far as I'm concerned, I

want you to keep doing doortodoor

>> because if you've got your guy and

you've got you, you got to start doing

10 10 deals a day. Just you two. You're

at 300 a month. You need in three months

you're at your thousand.

forget everything else. In three months,

you're thousand.

>> Yeah.

>> Right. But as far as you're concerned, I

don't think you should ever do something

alone.

>> Okay.

>> So, you have this skill set.

>> You should have somebody always watching

you so that you're basically you're

getting you're getting two birds one

stone, right? You're getting you're

double dipping on effort.

>> So, someone's always with you because

you're the lead salesperson

>> and they're learning until eventually

somebody else is the best salesperson.

You pass out. you you know you step back

Homer Simpson style into the bushes and

then they they slide up and then they

become lead trainer and if you want you

say hey I'll give you 60 bucks a sale

instead of 50 because it's a little hard

to have somebody else with you

>> right makes a lot of sense

>> easy yeah

>> cool

>> I feel like this is it so let's let's do

a quick recap here

>> let's do a quick recap and we'll

prioritize it but it's going to be an

easy list

>> simple not easy how about that

>> all right so make it blue for you

Michael All right I know Michael really

wanted the blue. He's like, "All right,

so the first thing we're going to do is

we made the decision to go scatter as

our avatar." All right, so that's

decision number one, which we just did

instantly, but there we go. Number two

is we switched our offer. So we have now

an AB offer

for offer for 3 months free.

And so offer A is going to be 189.

and then 60 per month after that.

And then offer B is 360

free

bin. That's our deal.

>> Yep. Three

Indads.

I'd also hit up your network. You only

need a couple, right? Indeed ads into

group

call.

Or you can just honestly invite them all

in person if you want, but sometimes

people are really crazy. So, the

two-minute, you know, call in person

and then tag along

and role playing until your eyes bleed.

And the nice thing is that basically uh

document demon duplicate is the process

that we use. And so, like the document

is like you have the script, they

memorize it. While you're walking

between doors, you're just like you're

you're role playing it back and forth.

What do you say? What do you say? What

do you say? Yeah.

>> Demonstrate. You do it in front of them.

Hey, watch me follow the script. Watch

me close deals. Now, duplicate, you

knock, I'll be here, I'll ride shotgun

and I'll watch you do it. So, you can

give immediate feedback.

>> Okay, that's it. And then in terms of

[Music]

I mean, [ __ ] what like what's the

what's the outcome of this? The outcome

of all of this is that your cash flow

positive

and babies

have

food.

Smiley face. Yeah.

>> Yeah. Feel better?

>> Does this feel clear?

>> It does. Yeah.

>> That's it. Yeah. Give me instructions

and I'll go.

>> That's it. That's all you have to do.

And the nice thing is one and two is

instant.

>> Yeah.

>> You literally just have to do this,

>> right?

>> Go hire five more sales guys.

>> I think this is the this is the play.

>> Yeah, I think so too.

>> Doesn't this feel like like the noise in

the world? Like quiet.

>> I think I was doing way too much.

>> Of course you were doing way too much.

>> I think I was like

>> you two different avatars and five

different acquisition processes.

>> Yeah.

when there's just one that if we just

did this well

>> Yeah.

>> we can solve the cash flow issue

>> and we can hit your hit your extra

thousand in the next like 90 days.

>> Yeah.

>> It's a quarter. It's nothing.

>> Mhm.

>> Feel good.

>> Thank you. Appreciate it. No, man. I

told you we we'd get through it.

>> Yeah. And so, Philip, I'm rooting for

you. If you enjoyed this and you want to

see a different business that went from

negative to positive in one

conversation, check out this

conversation with Alexar. He's a legal

person who does legal things for

musicians so that they can get contracts

and incorporated and whatever musicians

do to make