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The Successful Contractor Podcast – NEW EPISODE

94% Increase in Sales at 52% Gross Margin: How Al Balonze Broke the Glass Ceiling Hovering Over his HVAC Business, Efficient Air! Today’s show features Al Balonze of Efficient Air in Riverdale, New Jersey. Efficient Air has had back-to-back record-breaking years, in terms of revenue.

As of a month ago, sales were up 94% from the previous year… at a 52% gross margin! That’s fantastic. As you will learn, Al came to SGI looking to break through a glass ceiling hovering over the company. He just couldn’t seem to grow it beyond just shy of $2M. That’s certainly not a struggle any further.

What is so remarkable about Al’s story is this: He joined SGI weeks before COVID hit the US and effectively shut down his business. New Jersey was one of the first epicenters. And no one knew what to do. Thanks to Al’s determination—as well as the determination of his people—they’ve all made critical changes to Efficient Air that are now leading to massive results. They’re truly a remarkable team.

You can catch the Video Podcast on YouTube or listen wherever you stream your podcasts!

The Successful Contractor Podcast – NEW EPISODE

Mike Bachman Plumbing Finds Success by Putting a Premium on Culture; It’s on Target to Double Its Sales in 2021 at a Strong Profit Margin.

Today’s show features an interview with Victor Bachman of Mike Bachman Plumbing in Ogden, Utah. Mike Bachman Plumbing is seeing a resurgence! Last year, the company did $1.5M, and currently it’s on pace to hit $3M very profitably. We explored what Vic, and his team, are doing to enjoy such great success. And we dug deep into the operational nuances of his company.

Vic is proof that you can a great culture and a successful business. We cover a ton of topics, but as you will see, especially at the end of the interview, the revenue and profit numbers aren’t the only things that drive Vic. Vic comes from a family of plumbers; he’s the 5th generation. Mike Bachman Plumbing is a family business. His three boys work with him. His sister owns the business with him. His best friend is also a business partner. And Vic wants his entire company to share in that family feel and share in his vision. He knows when people take ownership in their workplace, not only are they more productive, they’re happier! It’s no surprise so many of Mike Bachman Plumbing’s employees have been with the company 10 and 20 years.

The Successful Contractor Podcast is Powered by Success Group International (SGI). A show for residential contractors about residential contractors… We chronicle business journeys, share insights, and celebrate successes in this wonderful industry.

You can catch the Video Podcast on YouTube or listen wherever you stream your podcasts!

The Successful Contractor Podcast – NEW EPISODE

This episode features an interview with Wes Carver of Wes Carver Electric in the Philadelphia area. Wes is a great SGI member.
He’s been on the SGI Executive Advisory Board, and he’s always willing to help others. In this show, Wes talks about his story and his business. Namely, Wes shares how he did $2M in 2020 and how he’s on target to do $2.8M in 2021 currently, and both years came with great net profit margins!
Yes, Wes is running LEAN and MEAN. As you will see, Wes prices himself properly, trains his team to deliver exceptional value, closely monitors his KPIs, and sets goals and motivates his team to hit those goals. Plus, Wes talks about how he keeps himself accountable—that’s through his relationships with other SGI members, and in particular, his Pennsylvania/Maryland Profit Platoon.

You can watch the Video Podcast on YouTube or listen wherever you stream your podcasts!

Electric Company in Philadelphia

The Successful Contractor Podcast – NEW EPISODE

5 Qualities of Great Leaders – a Panel Discussion with Wendy Ellis of Capital Plumbing & Heating, Joe Zimmerman of Summers & Zims’, and SGI’s Michael Zeller

Today’s show features an interview with Wes Carver of Wes Carver Electric in the Philadelphia area. Wes is a great SGI member!

Today’s show is actually a new program we’re offering you, our members, called SGI Monthly Member Panels.  These are interactive, LIVE programs where an SGI coach and a I talk to your fellow SGI members about a particular topic. This is our second ever panel!  It features SGI Coach Michael Zeller, Wendy Ellis from Capital Plumbing & Heating Edmonton in Edmonton, Alberta, Joe Zimmerman from Summers & Zims’ in Atglen, Pennsylvania, and me.

This was an exceptional conversation—and an insightful one.  Wendy and Joe have been highly successful operators for a long time, and it’s due to the fact that their team absolutely loves them.  But that love has been earned.  And you will see how Wendy and Joe earned it.  I hope you enjoy this Monthly Member Panel and take away a nugget or two.

You can watch the Video Podcast on YouTube or listen wherever you stream your podcasts!

5 Qualities of Great Leaders

The Bentonville, Arkansas-Based Business Has Grown from $1.7 Million Four Years Ago to a Stunning, Projected $8.5 Million by the End of the Year; It’s Happened by Hiring the Right People, Training Them Well, and Empowering Them to Do Their Very Best.

This story is an approximate transcription of a “The Successful Contractor” podcast interview. You can listen to this interview HERE.  “The Successful Contractor” podcast, powered by Success Group International, is a show for residential contractors about residential contractors. It chronicles business journeys, shares insights, and celebrates successes in this wonderful industry of the trades and tradespeople. 

Roofers Success InternationalWill Brown, along with his father, Bill, and brother, Robert, are the Brown boys of Brown Boys Roofing in Bentonville, Arkansas. Over the last four years, the company has experienced tremendous growth, as it’s exploded from $1.7 million to a projected $8.5 million by the end of 2020—and that number would be higher if they could locate the materials to complete additional jobs.

Many things have contributed to Brown Boys Roofing’s transcendence: great people, strong operational systems, and improved marketing efforts to name a few. However, maybe the biggest reason for the surge has been an altered mindset by Will, who bought the business from his dad, Bill, and his mom roughly four years ago.

As you will read, Will came to the realization that Brown Boys Roofing could only become as large and as successful as he allowed it to become.  The business needed to grow beyond himself. That meant that Will had to empower his people to make decisions, even the hard ones.  And he needed to accept that sometimes his people would fail. Rather than see it as disappointment, those failures would become stepstools to growth and future success.  Will has never been more excited and proud of his family’s namesake and his people.

 

Give me the short version of how Brown Boys Roofing came to be.

We were originally from Dodge City, Kansas, and we ended up relocating to the northwest Arkansas/Missouri area. Dad [Bill] was a USDA inspector. One of his coworkers said that they needed to replace their roof, and we had replaced our roof at our house when we first moved there by reading the package. So, we worked for three straight weeks on a house that probably should’ve taken four days. From there, dad got sick of doing the USDA thing; so, he cashed out, got some money from his 401k out, and here we are. That was 22 years ago.

 

When and why did you join SGI?

We joined in June of 2010. We were losing money. We hadn’t been paid in six weeks. On top of that, we realized that we hadn’t been paying our payroll taxes for two years. The IRS came knocking. Thank you, Jesus, we were able to get that squared away within 45 days of them knocking on the door. But a lot of that had to do with StraightForward Pricing.

 

Good transition. You join SGI, attend Expo, and go home to work on your business. What two or three things did you change first?

One was our image. We had to start looking the part as opposed to looking like a roofer; we needed to look like businesspeople. The main thing was StraightForward Pricing and raising our prices. And getting some training.

 

How did that first call using StraightForward Pricing go?

[Dad] and I looked at each other like, “Well, we’re either going to do this or not.” Clearly, doing the same thing over and over was not producing results. Let’s not be insane anymore; let’s try something different. So, we go through the whole process with this customer, and I’m just circling stuff, and I’m adding it up in my head saying to myself, “Holy crap!” [Laughter] It was over $6,000.  A week and a half ago it probably would’ve been $1,500 to $2,000.

With my best face, I said, “This will be what it will be.” And the customer said, “Ooh, $6,000 is a little steep.” And I thought, “no chance.” [Laughter] Then I said to him, “What if we don’t do this level six?” So, we marked it off. It was still $5,000-something, and we started the next day. [Dad and I] were halfway down this guy’s long driveway, I looked at him and said, “What the hell just happened? [Laughter] I don’t know, but let’s do it again.”

The next morning, we got another call: “Are you the people who have the prices already set aside and not making it up on the spot?” Oh, yeah. Since yesterday. [Laughter] That customer told a friend.

 

When did you invest in training?

It was when we started making some money to dig out of our hole. It was probably in the fall of 2010 when we went to our first class. We’ve gone through all of the classes now. The learning curve was vertical.

 

What were some of the other big changes implemented in those early days?

The mantra of change your people or change your people was a big one. We had one salesman, and after we joined SGI, we said to him, “Hey, this is going to be awesome. We’re going to send you to training.”  He said, “I’m your best salesman, I don’t need training.” So, I said to him, “Well, I guess this is your two-week notice then.”

 

So, you believed early on in the system?

One hundred percent. Actually, it was my brother, Robert, who said, “We’re going to do this. I mean, it’s clearly worked. You saw what happened on this particular customer’s house.” So, he was really pushing it.

We were interviewing someone to answer the phones all the time instead of just the cell phone. And the first person who came in was a Walmart layoff and way over-qualified to work for us. After the interview—and I say interview lightly—we sat down and talked.  I said, “I don’t know, she’s way over-qualified.” And for the first time I saw my brother animated about the business. He said, “Isn’t that the point?!” [Laughter] That call taker ended up becoming our office manager.

 

You were big into commercial and construction back then, too, right?

Yes.  They were our lifeblood.  So, when we joined, we just decided [to eliminate] that part of the business. We were tired of being the bank. When cash flow starts increasing, woes tend to go away. The sleepless nights got a little less once we made that transition.

I think the biggest change we made was the realization that it’s okay to be profitable. It’s okay to price higher than others in the market. It’s okay. More people are driving the Mercedes, Lexus, BMWs than you realize. Once you start looking at what they’re buying versus thinking it’s all on price, it makes sense.

 

How about the financial side of the business? Did you learn your numbers early on?

Well, my wife and I were just talking to [SGI Accounting Coach] Patty [Myers] yesterday about stuff. I mean, if you think you have it figured out, you probably want to check your ego.

Back then, we had been basically losing money every year. Our line of credit was what our money was for years. I think it was 2012, a year and a half after implementing the RSI processes, when we were sitting down doing our 2011 taxes with the accountant. He says to us, “It looks like you’re going to end up paying around $20,000 in federal taxes.”  Dad about blew his lid.

I said to my dad, “You’re complaining about making money!” So, our new mantra became, “We get to pay taxes this year.” It’s tongue in cheek, but at the same time, what a blessing.

 

When did you finally get out of the field and stop selling?

It was October 1st two years ago. I haven’t been in the field other than the random thing because I had brought on two salespeople. So, we went from dad and I selling to two other people selling. And my focus became creating processes for selling as opposed to personally selling. It’s easier for dad and I, being the Brown Boys, to sell a roof than some random person with the last name Smith.

 

Why did you pull yourself out of the field?

I was running leads all day and sitting at my kitchen table doing what I needed as GM for hours at night. I have a wife and five kids. When they’re saying, “Well, he’s in the room, but he’s not here…” They missed time with dad. That was hard. So, it wasn’t hard for me to give up selling. Fast forward to today—not being needed.  That’s a bigger transition.

 

Talk about not being needed…

Our management team, they do an amazing job. When I’m at SGI’s Expo for a week, if I get a text, I’ll be shocked. They really try to protect my time away. Now, they may respond, because technically I’m working, but if I’m on vacation, they don’t bother me. They may fill me in later. It started from having that mindset of, “Look… I want you guys to make decisions. I set the parameters, you have so many dollars to make the customer happy. If you can’t do it within those parameters, upgrade it to the manager. If they can’t make the customer happy, then it will come to me. If I’m unavailable, get two or three managers together to make the decision, and we’ll deal with it later when I get back. By doing that, empowering people to lead, that has been very helpful.

I have found that people don’t want a boss.  They want a leader. Bosses tell you what to do. Leaders teach you how to do, and then let you do it. They let you learn and let you fail because that’s how you learn. You learn by failure. So, I’ve created a culture of allowing failure because when they fail, they learn.

 

Where did that “allowing failure” mindset and culture come from?

I was given the book, Extreme Ownership by Jocko Willink. Then, I watched a YouTube video of his called, “Good.” It’s only two minutes, and it messes with your head a bit. The point of the video is when bad things happen, say, “Good,” because now you have an opportunity to learn from it.

The first time I got to use that was with a house that was historical brick and we cut the counter flashing in a way they didn’t want it. You can’t find this 100-year-old brick anymore. And I got to go and say, “Good.” We had to do what needed to be done to make the customer happy, and ultimately the lady was really pleased. But it wasn’t without headache.

The second time it happened was with Rich, our now sales manager. We had a new sales process. He estimated a roof and forgot to add the tear-off on a big roof.  I asked him if he noticed anything [on his proposal]. Because we’ve taken this StraightForward Pricing approach, if we missed that, that $3,000 is on us. I just said, slowly and purposefully, “Good.”  He was shocked. He asked me, “What do we do?” I told him that he needed to find value for that money. I need word-of-mouth value, Facebook review value, Google review value.  We need to do whatever we can to get value out of that $3,000.  That was a defining moment for Rich. A lot of other companies and jobs would have taken that out of his pay.  We used it as a learning moment, and he loves working here because of it.  I tell all of our salespeople: “I expect you to screw up and cost me money. Because if you’re not, you’re not trying hard enough. I need you to feel comfortable enough to make your own decisions.”

 

How have you spread that “allowing failure” message among your management team?

We talk about it a lot.  We have a Wednesday staff meeting with everybody. I think we’re at 27 employees now, and we just talk about it fairly regularly. And even in individual meetings, I say, “I need you guys to make decisions. You’re never going to learn until you do.”

 

How do you handle employees that continually struggle or make constant mistakes?

We have a management meeting every Friday morning. We sit down, and we’ll say, “We have a problem with employee X. One, does he fit our values? One hundred percent. Two, is he worth investing in? If so, three, what’s the plan?” Then, we try and figure it out.

One of the chapters in the book Extreme Ownership explains that there are no bad teams, only bad leaders. So, our first approach is internal. Where have we failed to train and teach this person? Then, we move through the process. Now, you have to let people go from time to time. You’re going to have knuckleheads who only want to punch a clock.

But I don’t want yes men. I want people who push against me. I want people to say, “No, I don’t think that’s a good idea.” Especially next week when I come back from Expo, I want that. There’s a book that I recently read called, Rocket Fuel by Gino Wickman. It talks about the integrator and the visionary. I’m a visionary. The problem with visionaries is they have lots of ideas, but need somebody that will say, “No, we’re not doing that. Let’s focus on this right here first.” [Laughter] Because I will come up with random ideas, and my team will say, “Oh, that’s a great idea. Maybe one day. But let’s figure everything out first.”

 

Do you have company meetings, and if so, what are those agendas?

Yes, every Wednesday. The first thing we do is start with a prayer really quick. Not everyone has to participate, but it’s just who I am. Then, we start every meeting with testimonies of good things that happened. We say, “What are our good?” Not Jocko “good” [Laughter], but really good things that happened.

The testimonies take most of our time because it’s people on our team standing up and talking about this customer said this and that. I want everyone to hear those good things. If you only talk about the bad, everyone is going to think that we don’t do anything right. Once we get people sharing the good things, I bet we’ll get eight to 10 every Wednesday, whether it’s the sales team, field supervisor, or the team in the office. We have a lot of fun.  We also have culture days, which are interesting.

 

What are these culture days?

We do them in the spring before it gets really busy. We’ll have “guns and fun” day. We’ll barbecue.  We have a lot of veterans who work for us. One of them is an NRA Field Safety Officer. He’ll bring in guns, and everyone interested in shooting can. I provide the ammo and food. We pay everybody for that half a day, we change the voicemail, and we enjoy each other’s company.

Recently, we went to Topgolf as a team. In the past, we would go to the local AA baseball team, get a box suite, have barbecue, and bring in the families and stuff. I want to have fun outside of work because the more fun you have, the more fun work can be. We have better relationships. And then whenever you have conflict, you have that family environment where you can work through it. The best relationships are forged through conflict. So, I’m not afraid of conflict.

 

What do the rest of those Wednesday company meetings look like?

Every other week, we’ll have a safety portion, which my wife, who’s the office manager, has that squared away. Then, we’ll talk about whatever it may be, whether it’s communication or how to approach certain situations. And we review the sales before we get into the nitty-gritty. And we do a cash pull every time we hit our goal, and they’ve destroyed goals the last couple years. I’ll put a $100 bill, a couple of 50s, several 20s, fives, 10s, and a bunch of ones. And whenever we hit our monthly sales goal, everybody gets a pull [out of this bag]. Everybody whoops and hollers. It’s a good time. We do that every month. Then, every quarter, for every month we hit our goal, and assuming we hit our quarterly goal, you take a pull. So, you can get up to four pulls. And before we end every meeting, we will talk about scheduling, talk with each team, and we want everyone to know where each department is. That way, everyone is on the same page. That’s nice to be able to do that every week.

 

Do you do any additional training?

Yes, right after that meeting on Wednesday, the sales team stays, and they have their hour individual sales meeting. Check out Learning Alliance training by Success Group International.

 

You said earlier that you have 27 people now. How are you finding quality people?

Referrals mostly. We’ve done some recruiting on Indeed. We’ve found that is good for administrative people, and Craigslist still works for people working outside of the office. But our biggest issue has been getting people to show up for our group interviews.

 

Could you talk about your group interviews?

Yeah, we stole the idea from Hish [Rahman of Precision Roof Crafters].  I think he stole it from someone else. We start it with an orientation. I want them to know who we are to see if they even want to be with us. We do that upfront. Then, I make them watch the [Jocko] “Good” video. Then, the second interview is typically over the phone with an office manager. The next is face-to-face with three or four people who will interact with this person [in their prospective position]. If anybody says no to a person, it’s a no. We have a tight culture, and we want to maintain it. We’re very protective of our family. Not only that, but my wife and I homeschool our kids, so they have a room in the office.  So, they will literally be around my family. I’m very protective of that.

 

What do those four or five-on-one interviews look like?

We go through scripted questions, and everyone in the room asks something of the person to try to get a feel for him or her. And after every interview, I sit down and I debrief with everybody who’s in the room to see if we go to the next step.

The last interview is with my brother and me, the Brown Boys. We have them go through every job they ever had back to high school and college. We’ll ask five or six questions about each. You find a lot of interesting things about people when you allow them to talk. The big thing we see is people changing jobs every six to eight months. But we’ve realized that when we trust the process, we have a higher probability of success.

 

Is there a particular interview question or two you ask that always gets people to reveal who they really are?

Tell me about a time that you treated a customer poorly. Tell me about a time you told a customer off.  Or, what was the first thing you fixed? What was the first job you had, and how old were you? You want to see what kind of work ethic a person has.

 

What’s onboarding look like at Brown Boys?

For salespeople, they sit down and go through the sales system, and they ride along with the sales manager. Then, they get their iPad, and I teach them how to use the system, because we want multiple voices in their ear. I will show them how to draw a roof and how to estimate it in our software. Then, I have nine different houses with photos and what I want on it. I hand them the paper, the script, and ask them to draw the roof and estimate it. After they’re done, which can take a long time, they come back. I break out the red pen. [Laughter] And I check things off, and I write how much money they cost me. The last two guys we hired were buddies, and it became a competition to see who got less red.

That happens the first week mainly, going through the process. And we split it up. The first half of the day, they’ll start with the sales manager running a lead. Then, we’ll have them sit with the CSR for a half day, and the dispatcher for a half day. They will sit with everybody. We put them on a roof with a crew. They go through the whole gambit. The whole process takes about two weeks.

How quickly they pick up things impacts how quickly they run leads. And then, we have them start the first couple of weeks just on gutters. We will then throw a random roof replacement in here and there. And we spend a lot of time debriefing each individual one. You get a sense when someone is really ready.

 

How do you approach goals at Brown Boys?

For example, our sales team has individual goals. We start with what our overall revenue goal is going to be. And we have a feel as to who’s capable of what. And then we ask the question, “What do you want to do?” The sales guys will say, “Well, I think I can do this.” I’ll say, “Well, okay, I have you set for this much. If you do that much, that’s awesome because it’s more than I hoped for.” We really just try and set SMART goals.

 

You mentioned before the interview that your dad [Brown Boys’ founder, Bill Brown] had his best sales year this year?

Yeah, he did.  He’s actually having knee replacement surgery, so he’s pretty much done being on roofs now. But he hit $3 million before the end of the third quarter!  That’s residential only—no commercial. He was just killing it. Our sales manager honored him in our last meeting together. He hit a sales goal I could never hit. And he did it with three months to go in the year.

 

All this additional business means you’ve needed more leads. What have you been doing for marketing?

Our marketing predominantly is TV and radio. We use [SGI Partner] the Brand Guys. And the last couple of years, we’ve been heavy on radio. In 2020, we added TV. When we added TV, our leads didn’t change much, but the quality of the leads did. My goal was to have an average replacement ticket of around $10,500. We’re at $15,572. The only thing I can attribute it to is TV. People who are looking for “Chuck in a truck” aren’t going to call somebody advertising on TV. They know that someone on TV is probably charging a lot to be able to afford to be on TV.

 

You also get some exposure by being very active in your community. Could you share what you do?

Sure, [during Breast Cancer Awareness Month,] we turn our names into the Pink Boys. We graffitied over Brown with pink. It started because my grandma was a 34-year breast cancer survivor. We started by donating 5 percent of our sales.  At first, we didn’t set a limit. This will be our third year doing it. We ended up writing a $19,655 check to a local breast cancer charity. They use the money for things insurance doesn’t cover, and 100 percent of the funds go to people in need.

Everybody on our team was on board. They loved it. Since, we have a lot of veterans on our team, after coming into contact with Folds of Honor, we wanted to do something for them. So, we came up with Camo Boys [Laughter] in May because that’s Military Appreciation Month. We donated 5 percent of sales up to $20,000. This will be our second year doing this for Folds of Honor. The last time we did it, it went so well, we actually upped it to $30,000. So, we’ve donated $50,000 over the last two years for Folds of Honor and just under $60,000 the last three years to support people dealing with breast cancer.

 

Being able to help so many people through your charitable efforts, what’s that meant for your company and your people?

Everybody gets a kick out of it because we wear our traditional blue shirts, but we get to switch it up to camo and pink. So that’s fun. But the other side is just hearing people thank you for what you’re doing. “We love your company. We don’t need a roof, but if we do, we’re going to call you because I’m a veteran, my son’s in the military right now, or whatever.” And that’s not why we do it. We do it because we have a team with two guys who were in the Navy, one in the Air Force, and one Marine working with us. We want to honor them because they did something I didn’t have the [guts] to do in serving our country.

 

What does the future have in store for Brown Boys Roofing?

The joke right now is that I either suck at setting goals [Laughter] or our team is a bunch of overachievers. Last year, our goal was $3.6 million, and we did $5.8 million. This year, our goal was $6.5 million, and we’re on pace for $8.5. We’ve already sold $9 million, but we’re struggling to find the materials to finish those jobs. So, I clearly suck at setting goals.

Actually, I was just showing them what I thought our five-year goal would be, $15 million. One person asked, “Is that next year’s goal?” I was like, “My God, people!  It’s supposed to be a five-year goal!” So, I don’t know what the future will hold. But they’re pushing me.

I do know this: I don’t want the goals of the company to be revenue. Revenue happens naturally. I want goals to be that nobody drives a truck older than five years. I want goals of going on company trips. We went on a cruise last year, actually. So, we’re trying to come up with different venues and things we can all do together. The money will come because we pay attention to the numbers. We major on the major things and minor on the minor things.

 

It sounds like you’ve stressed having an enjoyable place for people to work. That’s your culture.

I like to look out for the best interest of the people who are around me, not my best interests. If you’re really leading people, you’re going to show them the best way for them, not necessarily for you. I want people to be proud to work here because we’ve helped them achieve so much for their families. You know the triple win philosophy with SGI… I believe in it. My team has to win first because if they win, the customers will win, and then the company will win. I want to focus on our people as much as I can.

 

If you aren’t a member of Success Group International, and this success story has peaked your interest, the first step is contacting us to learn more, or finding a Profit Day near you to attend!