If Your Business Feels Messy, Here’s What’s Missing! (Ep 282)

If your jobsites were as organized as your business, would everything be in order—or would there be chaos? 🔥🤔

Today, Max talks about keeping your construction company organized—off the jobsite. 🗂️📋

Money loves speed, and if your administrative side lacks order and control, money will go down the drain. ⬇️💰

https://www.youtube.com/playlist?list=PL76rc3DrCOMb7VM9icAOQmLodNCSZTfKf

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📧 Email: paris@jobtread.com
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Transcript

SPEAKER_00 0:00

You know that you've got to be in control of your construction project on site and yet you put up with a business that's disorganized that has no order. On today's episode, I'm going to talk to you about how I'm going to help you change that. Enjoy. How old are you going to be before you start to experience life like you want it? I want to tell you right now, whether you like it or not, there is a better way to do business. Hi everyone, welcome to the Business for Builders podcast. We are back. My name is Max. I'm your host. It's great to be hanging with you. Look, just a quick shout out to those that have been with me for the long term. I appreciate you coming back. And if you're brand new, hopefully you get something out of this will help you build a kick-ass business, something that's highly profitable, that's high performance, that gives you better lifestyle. And it's gonna be uh this is gonna be another good one. So pretty fired up about uh what I'm gonna share with you today. As you can see on the board, we're gonna talk chat about order. I like having things in their place. And uh just before we get started, like and subscribe, all that kind of good stuff, and uh get across to Business for Builders VIP. Answer the three questions if you uh answer those or let you in, or feel free to just follow us, Business for Builders on Facebook, uh Facebook. That's an open group as well. And of course, we're on Instagram and TikTok as well if you're into TikTok. Okay, uh, I think that's about the long and the short. If you want to talk to me about uh business coaching, max at elebusinessadvisory.com, or you can shoot across to the elite businessadvisory.com website, hit the yellow button, book 30 minutes, chat with me, free of charge, no strings attached. Let's see if we can't help you make your business better. All right, today. So working my own general contracting company or my own building company, and also coaching builders uh all over the place. Uh, you know, what I find a lot, both in my own business, one of my challenges is to create order. And I find that uh what that will do is if you are to be very ordered in your approach to running a building company, uh, what you'll find is you'll be able to expedite the process. Now, money loves speed, right? So the sooner you can get a lead, the quicker you can move a lead to a contract, and the quicker you can move through that building contract to completion, the more money that you make. Uh, that would be top shelf understanding. However, if your overheads are too high, that's gonna compromise your ability to be profitable. If your delivery system is ordinary, that's gonna compromise your ability to be profitable as well. So, what we're gonna talk about is I think what we're what I'm trying to get at today is probably a fundamental. Like you've got to get it into your brain um that if you if you and your business, now I think to be orderly in your business, it starts with being orderly in your mind. So if if your mental space is a little bit cluttered or is perhaps a little bit disorganized in its approach, then what you're gonna find is that this is why I say the speed of the leader determines the speed of the pack. So if you're disorganized in your ability to lead yourself, how do you think you're going to be able to lead your building company? It's not gonna happen. So I'm about to bring on a brand new office manager, and uh which is normal, pretty normal for a building company, I think. And uh what's what presents some challenge here is that we're gonna run remotely. So it's a bit of a hybrid type maneuver. So what the challenge is for me is to maintain order and yet have the ability to have someone working remotely that is organized and efficient and that's productive and that is very complementary to what we do as a building company. And so, you know, I think more than ever the biggest challenge, I mean, it certainly keeps it has the ability to keep your overhead down. If you can run out of your home office and then use someone remotely, like I'm thinking of doing, um, that certainly has the ability, but then the control mechanism's not there. So if you're not orderly in your approach, I the whole remote thing is just not gonna work for you, okay? So you've got to be able to control the narrative, not to be a control freak. You want to be able to control more and do less. That's where we get lifestyle, okay? If you're busy working a thousand hours a week, um, you're gonna find you can have some challenges, right? So behind me, I've got a good old acronym for order, and I think it's fairly it's fairly relative to you and your building company. So the first thing that you've got to understand is what is my objective, okay, and that's gonna come from a few things. You know, Gary Vaynichuk talks about clouds and dirt, and what he what's he what he's referring to is you've got to have a bit of a dream. I get that, which is which is really a good understanding of boy, if I could just click my heels and wiggle my nose, that's the kind of business I'd have. That's the kind of lifetime, lifestyle I'd like to have. But then when we talk about vision, that's more of getting down in the trenches and getting after it. There's got to be more clarity of not just where we want to take the business, but how we're gonna get there. What is that going to look like? How do we reverse engineer that to figure out what I'm supposed to be doing today? What am I supposed to be changing today? What am I supposed to be improving? What work do I need to do on myself? All those kinds of things. We talk about leadership, we talk about personal, private, corporate leadership. That's what I've got a responsibility to develop and grow into. Okay. Clear targets remove confusion. So what we're trying to do is get clarity. Okay, so if you haven't got a clear vision as to the pathway, John Maxwell talks a lot about if you're going to bring on team like I'm about to, like we already have, there's got to be a process of the fact that you are you're you're knowing the way and you are doing it. So you're knowing, you're doing, and then you're showing. And that's the big part about that empowerment. Transferring the power from me to you. That's what we do. Okay, so clear targets remove confusion and also wasted effort. Okay. Objectives guide decisions across sales, operations, and finance. So if you know what your target is, the decision that you have to make today is either going to uh enhance your ability to reach that goal or objective, or it's going to detract or take away from that. Without defined goals, chaos becomes the default. Now you know how I feel when I talk about chaos. Chaos is a byproduct of disorder. So what we're talking about today is polar opposite to disorder, which is order. If you have order within your business, what you'll find is that you will gain control. We want to control more, do less. How do we do that? Well, there's a whole bunch of stuff we've got to do. Okay, second one, and this is important. The roles. Who does who does what? Now, from personal uh experience, you know, when when my business partner um and I, we we started to talk about what we wanted to do, and we talked about past experiences, and there was a real discussion around if we did join forces, what would what would make it work? And you know, I think being an Aussie, having been in Canada now for 10 years, more, 11 years, and uh knowing how to build a house, of course, but having someone in your corner like Jed, who's been doing it in this area for over 15 years, um, but been in the industry for 25, all of a sudden I looked at him and I thought, there's not much that he doesn't know. And I think I can be his wingman and compliment him in the far in as far as doing sales where I know enough about construction to be dangerous. Okay. Then the flip side was that he really, you know, his forte was on site, construction management, not so much business management. And that's where I came in. So it was very, we immediately figured out what our strengths were at top level, what our likes and dislikes were. Now, I mean, I'm not that old, but I'm sort of getting on. So putting a bag on every day is not something that I think I'd want to do, um, certainly not for the next 10 years. So I was at a moment in time where I thought, well, I'm gonna work this hard because this is actually the best thing for me. And I've got a head for the numbers in the business, obviously. So there's automatically a very good description around roles now, responsibilities on a daily basis. There's some things that are very distinctly different that I do, that Jed has nothing to do with, and there's things that Jed takes care of that I don't need to get my nose into. However, in some cases, there is an overlap, it's inevitable. Okay, when I'm working not just sales, but I'm working in procurement, project management, and scheduling, there's a lot of chit chat that we've got to, you know, have to make sure that the project keeps moving forward. When I'm doing sales, not a lot of overlap, not a lot of discussion. I might pick his brains about the scope of work and how long do you think it'll take, maybe. Um, but other than that, I take it from first phone call all the way through to contract, probably 95% is all me. Okay, but then when we get into construction, you know, I don't feel obligated that I've got to drive out there every Monday to make sure everything's under control. Because I've just had three, four conversations with Jed last week, if not more, and he knows, he tells me what's going on, and I'm like, mate, I'm confident you got this, you know. And it's funny because I'll ask him for advice about a situation that I'm facing. He will then say to me, mate, whatever you feel is right for the company, I'll trust you. And then there's stuff on the other side of it when Jed rings me and he's got a query about what's going on on the job site, and I'm saying, mate, what you're saying makes sense, but I'm gonna leave that call 100% to you. Whatever you do, I'll back you. And so there's some intangibles as well as tangibles. It's like, right, I handle sales, Jed handles construction. Um, but then there are some challenges that we have with personalities, whether it's trades or whether it's suppliers or whether it's clients, and there's some things there which we talk about, and essentially what we've got is Jed's the good cop and I'm the bad cop. Okay, so you know, there's things that we do come together with and we do discuss about what's the best way to move forward, and we always talk about three moves ahead. It's like what's the ripple effect going to be if we make this, you know, abrupt decision. Um, and we think about the fallout and the challenges. So there's that's the other upside, you know. So part of that uh chemistry is that there is good chemistry, um, but there is a lot of trust as well, okay? And so that really comes back into roles, who does what? So you've got to be thinking about okay, what is my objective? What are we trying to do in business in life? And then what we've got to start thinking about well, am I going to get a business partner like Max, or am I going to be a gangster recruiter and be able to recruit good humans, have the systems ready to go, so we're not setting these folks up for failure, and then use those systems to uh bring accountability into the process to make sure that you, as the business owner, are having the job done the way that you want it. Everyone must know their lane and their responsibility. I just gave you examples of that. Strong roles create accountability and speed. And so because I'm not getting in Jed's way on the job site, um, he's able to just pin his ears back and just go after it doing what he knows. He rings me and says, I need to buy a thousand dollars worth of tools or a thousand dollar tool. I said, mate, if you think you need it, get it. Here's a PO. And uh, so those sorts of things are well defined, and and I know that if he says he needs it, he needs it. So um there's there's very much two-way accountability. We're very accountable because there's safety and there's peace and harmony when there's accountability, okay? Um, right, number three here is data. Know your numbers. We're just chatting with another business owner, not in the construction business. Um, and uh, you know, just chatting with him about his business, and of course, a lot of that was around where he was dissatisfied with a nice, even, predictable income. It was very, oh, hills and valleys and not sure what happenings was this month. And, you know, the as I'm sitting there and my data head is going and my numbers head is going, after he finished talking about the unpredictable nature of his cash flow and his revenue and everything like that, and I said, tell me what you've spent on marketing in the last 12 months. And he immediately did this. And you know what he said to me? He said, I've got good word of mouth. And so if you've been in this room with me long enough, you will know that word of mouth is a cherry on top, but you've got to be investing one to three percent of your forecast revenue on marketing today, month in, month out. So if you're looking into my books, you'll know that on December 1 I flicked on Google Ads. Today is March the 17th, and I have been spending on average between$35 and$50,$30 and$50 a day on Google, do the math, and that has been on since December one. So there's good consistent marketing advertising over the weekend. We get 300 grands worth of inquiry. Okay. So what I get is there's a lot of word of mouth, and we've got a lot of build-up, a lot of return clientele. I don't really follow the lifetime value of clients because it's not as you know common. You build one house for a customer and you maybe you don't see them for 10 years. Okay. So, you know, we we tend to follow the metrics that are relative to us. But with this guy, and you might be the same, it's like sometimes it's but basically what I hear is a spoom or bust. What I want to do is keep it a boom, bite off more than I can chew, and then just chew like a bastard. That's what we want to do. Because all the time we're gonna be bringing in, if we've got systems, we're gonna be bringing in new humans. So we always want to keep that bow wave, top of funnel, being able to select. The last thing you want to do is go, I hate that friggin' inquiry, don't like that job, but I have to give them a quote. And if they say yes, I have to work for them. Why? Because I've got nothing else. That's what creates hills and valleys, okay? So I give that example that you need to know your numbers. You need to start with a revenue total. What am I shooting at? Okay, and then the next piece of data is going to be, well, Max, I want to do a million dollars worth of um revenue of sales, let's say, a million dollars worth of sales, and I'm saying to you, are you ready to invest$30,000 in marketing and advertising marketing and advertising? And a lot of guys will go, no, not really. Well, or I haven't got it. And see, that's always a chicken and the egg as well. You know, it's it's hard to get the marketing money when you don't have the revenue, but you don't get the revenue unless you spend the marketing money. It's not easy. If it was easy, every builder that you and I both know would be multi-millionaires, and that's not the truth, it's not the case. So you've got to know your numbers. Um, so we move from the revenue number, then you say I want to do million, then I've got to know the number I've got to spend on marketing. Then what you need to know is well, I need what's my conversion rate? So the data around if I get a million dollars worth of inquiry out of that, how many, how much of that do I convert to sales? And if you uh, you know, typically it's probably 20%. So for every five leads, four are just going to be wood ducks, tire price checkers, tire kickers, time wasters, or they're going to be people that'll come back in 12 months and then maybe consider doing the job with you. So, but ultimately it's like I've got to keep that top, that bow wave of leads coming in, because if it stops in 90 days I run out of money because I've got no work. Okay, so you've got to know the data. That's why knowing what the revenue is, and then looking at the other number, which is potentially what's my break-even point, and I need to know what my margin percentage is, and I need to know what my running expenses, my indirect cost, so not my cost of goods sold, but my indirect cost, I've got to know my profit margin, and I've got to know what my cost to run the business per month is, so I can calculate what my break-even point is. And then I've got to know what's an acceptable net profit that I need to make at the back end of the year to justify all the effort that I do. If I'm only making 3%, you're pretty much just working a day job. That's all you're doing. If you're making over 10%, now you're starting to build a real business. Okay, know your numbers. So we're talking about metrics, which is hard for a lot of builders to get their head around because they're like, mate, I just want to go and knock walls up. That's what Jed does. Now, the good thing about that is I don't get in his face about knowing the numbers. That's my job. He doesn't get in my face about straightening walls and making sure that trusses go up the way they're supposed to. That's his. When the inspector goes out and there's a problem, nothing to do with me. He knows to fix it. Okay, so data replaces guessing with informed decision making. A little while ago I did a podcast and I made the comment, uh might have put it on the board, that the math will show the path. It's very North American accent there. But you know, when you know your numbers, it will direct your decision-making process. Key metrics reveal problems before they become emergencies. And so when I've when we when we when I've got clients, and even when I do this in my own business, where we start mapping out all of those metrics or those activity key metrics, so they're like KPIs, what it does is at the end of the month, I look at it and go, where is the business behaving badly or negatively? Right? Because in some cases you've got good lead gen, you've got good conversion rate, but we we're the profit, we're not hitting our break-even point. That tells me that the fixed expenses in the business are too high. Okay, you might have lean fixed expenses, you might have good numbers as far as inquiry, but the conversion rates down tells me we've got a sales issue. See, and so this is where you, if you want to be the building company and the builder that everyone kind of admires or looks up to or has some level of respect to because of the little empire that you've built, then for you to go and just dwell aimlessly and kind of go, I'm just gonna go out and try and sell another job, it you really are just going to burn year after year and after year after year, and I guarantee you there's hundreds of guys that have just put one foot in front of the other hoping it was gonna get better. At the end of a 25-30-year career, really nothing got any better. And so when you've got the opportunity to listen to this kind of content, you've got the opportunity to invest in getting the knowledge because the knowledge is powerful, it's full of power that will enable you to execute at a higher level, more strategically, more specifically. Um, that is what is going to enhance your ability to create a highly profitable, high performance building company, which is hopefully going to give the ability to control more, do less, have a better lifestyle. Got it. What gets measured gets managed and improved. Okay, and that's why, even for me this morning, I had to put in leads that had come come in. What's the scope of work? What is the forecast build value? That those data points, see when I'm just adding data points in, and then the spreadsheet is built to a point where it will extrapolate the data that I enter, and this is why you've got to have hygienic data going in. If you've not got accurate and hygienic data, then shit in, shit out, it's not going to be reliable. So I am very, you know, you know, very married to the fact that I want to know what my business is doing in real time, not at the end of the financial year when my account says, well, this is your tax bill, or you know, you're not making any money or whatever. And it's caught me by surprise. I don't want that, okay. Uh, I want to make sure that everything that I'm doing, I'm understanding the dynamics of the business so that I can manage it, so that I can improve it. Right. Ideas are shit, execution is the game. So we're talking about action and delivery. Now, I think for most builders, most carpenters, most tradies, we're all about activity. It's like you know that you go to work, you gotta get cracking, right? We need to carry that same work ethic across into the business side of our business, right? And so, you know, planning means nothing without consistent execution. So if you're going to add metrics into a spreadsheet that's going to help you understand the dynamics of your business, if you only do it once every couple of months, it's not gonna be worth anything. So it's you know, you drop the ball in execution. Now I know having coached building companies all over the world, that they they it's it's they struggle to either find the time or find the people, and all of that challenge is in. Is really based in the fact that they don't have systems. They just don't know what their business requires of them in the way of systems and humans. And so based on that blind spot, it's not even about execution. They just don't know what they don't know. Daily discipline drives progress and builds momentum. Okay. Anything that's been done of any that's that's that's really, you know, of any stature, that's of any size, that that gets recognition in the world, has been done over a period of years. I heard someone say, um, was it the McDonald's brand? It was this overnight success. Yeah, it was. It was the McDonald's brothers before Ray Croc got involved. It was, they said, yeah, it was an overnight success, it was 10 years in the making. So there's this time where you work out in the gym, if you're a cage fighter or whatever you do, it's you know, you play rock and roll like I do. The the ratio of hours that we spend in rehearsal and practicing, it's really the the the when you go out and perform, that's a reflection of how much rehearsal, how much practice, how much refining of your skill that you did. So the more of the education side of what it is that you are invested in as far as construction, let's call it, the more time you spend over here, it's going to be it's gonna far outweigh the result, but you won't get the result that you desire unless you do the work. Okay, so you've got to execute at a high level, make sure that you uh are disciplined daily and what you do in the business. See, if you want people in your business to be disciplined and do well and execute well, guess what you've got to do, Hotshot? Lead by example. Okay, speed and follow-through separate average from elite. Speed and follow through is what separates average from elite. And if you ask most people, do you want to be average or do you want to be elite? Everyone's gonna be like, Well, of course I want to be elite, I want to be a gangster. Okay, what you have to do is be very expeditious in your execution, and you've got to be very consistent. Right, last one here, let's wrap it up. Review. Now, really, this comes down to accountability, but review because you're gonna get feedback and improvement. Regular review turns experience into learning. So we have experiences, and then what that does is through experience we gain wisdom. You don't just wake up and go, I'm so wise. The wise ones are probably cocked it up the most, right? So it's through negative experiences mostly, but some positive, out of that comes wisdom because you have the ability to turn and briefly look at what happened, do an assessment, do a review, figure out what you did well, figure out what you didn't do so well, make the necessary adjustments. It identifies what's working, what's not, and what to adjust. Continuous improvement creates long-term control and growth. Okay, now the flip side of this, here's something else to think about, just as we talk about internal reviews and what it is that we're doing. We need to look at our performance, where are the gaps? What do we do well, what don't we do well, what do we need to adjust? You know, I think that I find it easy to get Google reviews. We got another one yesterday, okay? Um, and not just a five-star, but a five-star in a comment. You can go and have a look at that. Okay, those kind of like retail reviews, not just me reviewing the performance and giving my objective opinion of how the performance of the business is doing, but when we've got clients out there where in the last two months we've probably got two or three five-star Google reviews, that also reinforces in my mind that okay, at least with the delivery of our product and service as a construction operator and as a builder, clients are enjoying the process, okay. Um, if you're not able to get them, of course, if you're getting negative reviews, it's pretty obvious you're doing something wrong. But in the event that you're requesting reviews and people are hesitant or they just don't respond and they ghost you, that would that's gotta be, there's gotta be something there for you that says, maybe there's something up, maybe there's something that I'm doing. So what you're doing is you're reviewing your lack of reviews from clients. Why are they not helping your now? It could be the way you're asking. I often ask people like this: I say, would you consider sharing your experience with other homeowners who are considering working with Smith Sons to help put their mind at ease that making the decision to utilize Smith Sons Coldstream as their general contractor is a good decision? So what I'm saying is I'm not saying, hey, you need to fluff my ego or fluff my nest or whatever. It helps me with the business, absolutely. But what I'm doing is I'm asking them to help somebody else. And I think in this world, it's why I do this podcast. How much are you paying for this podcast? Nada. I enjoy doing it. I want to leave an impression, leave a mark. I don't want to leave disdain. I don't want to do that, you know. And so I want to help people, not just make money. Any of my clients will tell you that. I go over and above. Okay, and so if you're not getting the clients to help you in that regard, and maybe it's just the way you ask, maybe that little bit of insight's gonna help you. It's an aha moment where you go, I've been asking wrong all these years. No wonder I haven't got any reviews. Because I've been asking them, going, can you tell the world how good I am? Please, you know. So to wrap up, okay, so do that. That's pretty clear, right? Objectives, roles, data, execution, review. Screenshot that. Okay, that's gonna give you some clarity about when Max talks about order. What is he waffling on about? That's what I'm talking about. Okay, so order isn't luck. Like you don't just wake up and go, oh, my business is in order. No different than you wake up in your trailer, which is a shit show, or your truck is a shit show, all of a sudden in the morning, it is everything's in its place. Like you've got to go and put your hands on all the stuff that's out of order and make the correction. Okay, I want you to do that. Okay, so what we want is uh it's built through clarity, so we've got to make sure that we have a clear objective through structure, so systems and people and accountability all coming together, and then consistent action. We've got to be executing on a daily basis. Okay, that's called building a business by design instead of just operating a business that's kind of created by default. Okay, that's a bit of a loser's way to put it together. So uh if you've enjoyed that, maybe leave us a review. If you're feeling like uh you're feeling generous, perhaps, whether you're having a listen or you're watching this on the tube. Um, I appreciate people that are you know actively involved in that regard. And uh look, if you've got something you know you want to run by me, shoot it on an email, max at elitebusinessadvisory.com. Um, other than that, hit the website, spend 30 minutes with me, and I'll uh help you out as much as I can in that time and try to bring some clarity at least uh to you and your business and what you think you're gonna be putting together in the next months and years. Go build a kick ass business, see you in the next episode. Cheers.