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The Sharpest Tool™

COVID-19 | Consistency Is What Builds Multi-Million Dollar Businesses

Cheryl McRae
Josh Smith
Tommy Mello is the “home services expert,” owner of A1 Garage Door Services, author of “Home Service Millionaire,” and host of The Home Service Expert podcast. He shares why branding matters during the crisis, the system for consistent recruiting, and his secret to growing a multi-million dollar home services business.

Josh Smith (00:03):

Hello, everyone. Welcome back to the sharpest tool podcast, where we take the sting out of marketing until then we have a really special guest. Who's going to give you some practical advice on how to succeed right now during this crisis climate. And if Josh Smith and the VP of marketing for home services over here at scorpion, as well as the host for the sharper stool podcast. And joining me today is the one, the only Tommy Mello known in the trades is the, a home service expert. So Tommy, welcome to the program. Really appreciate you being on.

Tommy Mello (00:33):

Thanks, Josh. Excited to be here. This is going to be fun.

Josh Smith (00:36):

Yeah. Once you get people for those who don't know, rather than me introducing you, which I typically do for our guests, why don't you give our people a listening, some insight into your background and how you kind of came into the trailer?

Tommy Mello (00:47):

Yeah, so it's a long story of getting into the trades. I was in a landscaping company. First thing you learn how to do as a kid is cut lawns I'm to shovel snow. So that was the easiest. And then in my early twenties kind of stumbled upon the garage or business through a friend. And I ended up painting garage doors. I would paint about 10 in a weekend and I made a hundred bucks per door. So in my early twenties, I was knocking out over a grand a weekend and bartending and still going to school. And then I was like, man, this Chrysler business has got some good merit to it. So I started a small company with a partner and in 2010, I bought him out and we've been just having explosive growth. We're in, I think, 12 states soon to be another four states.

Tommy Mello (01:27):

So there'll be 16 hundreds of technicians. Well, over a hundred, I shouldn't say hundreds. We've got our own vehicle wrap shop. We've got a 35,000 square foot shop here in Phoenix. We recruit, we train here. We've got an LMS. We use a service. Titan is our CRM, which I'm absolutely in love with. And then I wrote the book came out about a year ago, home service millionaire, how I went from $50,000 in debt to $30 million plus company. And then I got the podcast, which is home service expert. And podcasting has taught me so many things. I've had about 130 guests and I've just learned a countless it's crazy, everything I've learned. So really excited to be here and doing this with you.

Josh Smith (02:10):

Yeah. I love that. I can totally empathize with that. And quite honestly, my favorite part about hosting your podcast is bringing on guests like yourself to gather every little bit of knowledge I can from you. So it's awesome. It definitely is worthwhile for business owners to listen to podcast, take some things away, take them back into the business and implement changes right away. So this is awesome. So obviously you're, you have a one on brand as a business and also an entrepreneur, as far as branding. Let's talk about branding for a little bit. What matters most right now during a crisis climate like the coronavirus pandemic. First one service business,

Tommy Mello (02:46):

As far as brand goes, I think a lot of people need to rebrand. They need to make sure there's a lot of unison. Your mailers, your website, your vehicles, the craziest thing I've seen. And I've got a small wrap company, do our own printing and then laminating and blotter. Really. You gotta wrap your vehicle. That's the cheapest investment. The best advertising. Your average ticket will go through the roof. Your referrals will go through the roof, wrap your vehicles, stay consistent with your message. Come up with a message and stay consistent with it. I look at this time, everybody's kind of asleep at the wheel right now. We're doubling down on marketing. Do not do not stop marketing right now. I will tell you this. And I haven't told a lot of people. This, I went from mailers to a lot more TV. My phones are ringing off the hook.

Tommy Mello (03:33):

I'm three days out right now. I reached a single technician is working late and weekends right now. And you got to find the message that works and continue to do it. I think another thing I would tell you is I'm a huge fan of Google, Google my business page, get something that drives reviews. We use a thing called BirdEye. It connects to our CRM, which is service Titan. And you know, I've got a thousand reviews on our main Google, my business page. I could keep going about just brand awareness. You need to come up with a USP, unique selling proposition of what are you good at? See, I sell oranges. People always sell apples to apples. I don't sell apples. I sell oranges that I have 80,000 cycles Springs or powder coater bread, the trademark max Lifesprings, a hundred thousand cycle rollers, the best in the industry. So you can't really compare yourself to our product because no one else has it.

Josh Smith (04:25):

So this vehicle wrap lamination machine that you have running right now. Tell me a bit more about that. What does that look like? Getting into that business from coming from garage doors?

Tommy Mello (04:36):

Well, I've had five rep companies since I've started and they were all using just crappy products, crappy printers. I didn't like the design. I've worked with a guy named Dan Ansanelli on the rap. He does a really nice design. And then it was a $40,000 printer, a $5,000 laminator. And now I'm using the best product. So we were buying about 20 vans a month and that's going to increase. So you should see my vans. I've got these PVC pipes. There's five of them on the top. There's this huge welded container that we build. I've got five welders at my scrap shop and we weld all of our own stuff. Then we get a powder coated and then we get these shelves installed and then there's carpet. There's an iPad machine. So we customize our own bands and I, my biggest client, you know, because of a one, but I'll tell you this, the best companies in the world, you look at a company like get all air conditioning, beautiful wrap it's 3m product. And it's just, it it's the difference of night and day. And he actually, me and Ken are good buddies. He called me up yesterday. He had his first million dollar day, which is amazing.

Josh Smith (05:41):

That's amazing. Yeah. You met, you mentioned two different things that just want to dive into this, uh, a little bit of a tangent, but I think it's really important for business owners to think with when it comes to this topic of branding, you mentioned two sides of the coin of the marketing coin, that kind of online digital component with Google, Google my business. And then you mentioned TV advertising, or what I would say is kind of this kind of offline component in your experience, going from $50,000 in debt to $30 million plus, uh, for your business, what balance did you have to strike as you grew from the digital compared to the offline or like more mass media channels?

Tommy Mello (06:20):

You know, I'm a big fan of direct response. So I say, do everything in your power, get on Groupon, get on living social, make sure your Google, my business pages awesome. Invest in link, building white hat, preferably and, uh, max out your digital footprint. And I think that that that's direct response. I love mailers. The biggest mistake I see with a wrap or a mailer is it's like, they've got the BBB, the Yelp, the Angie's list, everything they do. And I look at these trucks and they say, take a picture of your truck and black and white. And if the message doesn't stream what you do, then you need to rewrap your vehicles. And people are like, I just paid three grand or four grand. And I'm like, you gotta redo it because it's crap. You don't need to put everything you do on your rats. You just need to know the main thing that you do. And it needs to be clean and crisp. But yeah, I've invested a lot in just the website brings me just organically. I say we're up to about two and a half million between organic, a little bit of PPC, Google local services. And my Google, my business pages. Wow. That's how much revenue we do a month just off of the Google.

Josh Smith (07:26):

Yeah. Yeah. Now you talked a little bit about BirdEye online reputation management. How do you ensure that it's running well consistently? What's your

Tommy Mello (07:35):

So I have a full team of people that literally that's all we do. I get a notification to my cell phone and via email, anything less than a two star. Every time we miss a phone call, I get a text message. Every time we don't sell a job for more than $70, I get a text message of the technician of what job he's at with the customer's phone number. So I've created this checks and balance system. We're all called guy. Obviously, dude, what happened? I mean, we get alerts every time someone pushes the brake too hard on their vehicle, or if they turn too fast. So I'm a big fan of, I've always said, inspect what you expect. Yeah. I have a trainee here and he's like, what are all these checks? You're signing? Like these are all customer giving money back. One was $12.

Tommy Mello (08:13):

One was $22. One was $400. And he said, why do you give all this money back? I said, well, you gotta think we ran 67,000 jobs last year. If you take 1% of that, that's 670 that are unhappy because you're not going to make every single customer. Maybe we were late, maybe oil dripped on their driveway. You know which oil does it. We got brand new vehicles. So that was an old problem when I had an older fleet. But ultimately someone might've find it cheaper on Amazon. That's what I keep. Oh, I found it cheaper on Amazon. Well, we're not Amazon number one. And we got to install it a warranty. It I've always made this joke and I'm not going to do it, but people want it done fast. They want it done right with a good and they want it done for cheap pick two out of the three, because you're never going to get all three. So I just said it, I'm going to be the best quality and I'm going to be fast, but I'm not going to be the cheapest.

Josh Smith (09:04):

Yeah. Let's talk a little bit about recruiting because obviously your team is such a big part of building the brand, continuing to build the reputation and giving positive customer experiences. All the customers, 67,000 customers just with every single year. How do you go about recruiting technicians and bringing people into the fold?

Tommy Mello (09:24):

All right. I love this. This is a good question. So recruiting is not hiring right? Recruiting is so many people. They post an ad on credits when they need somebody. They hire because they're desperate. They say, I need to hire a technician. And a lot of times people only hire people with experience. I prefer no experience. So a good producer for me, we'll do a million and a half dollars. 1.5 million, a bad producer will do 300,000. So this is what I want people to think about. And I'm going to go into this a little bit, but that's $1.2 million difference. And a derivative of marketing should be a percentage of revenue. So if I got a million and a half dollars, 1.5 million, and I'm spending 10% on leads, that's $150,000 I could spend to get leads for that person. Versus the 30,000 I could spend with the 300,000 hundred producer.

Tommy Mello (10:15):

So I believe recruiting is going out there. We're all over Facebook, where we post on 20 different job boards on a daily basis, we're always looking and then I send them. So they got to go through an eligibility form. The next thing they got to do is go through a PR it's called predictive index. It's a personality profile. The next thing they have to do is a background drug test. Then I had them do a ride along. They got a pass for interviews, but when I get these people, typically four out of five of them will make it through training. We're sending one out of five home because they're not living up to the expectations. They've got to show up here on time. So there's all these things that we require, but I'll tell you what the fact is. We just had a training class, the guys that just went home, they are murdering it.

Tommy Mello (10:57):

And they're amazing people. So I say some people say, always be closing. I say, always be recruiting. I email my customers a recruiting video. Hey, we're always looking for great people. All my radio ads, every other one is where I was looking for. Great people apply here. I've got a website called [inaudible] dot com and always be recruiting the difference between a call center. Like right now, our booking rate is 84%. And that's a fact, that's not an assumption. A lot of people say I'm averaging over 80% booking rate. No, you're not. No, you're not. You're not because you're not tracking it. And a lot of people say, well, I'm not going to count that against them because that was just a part's call. Well, let's find out why people are calling you about parts. Is that a PPC campaign that needs to get turned off. So you need to count that. And then, and then all, well, that was out of my service area. Why in the heck are you getting calls out of your service area, countered against them so you could research it. I know it doesn't sound fair, but if you're not inspecting what you expect, then you're going to keep getting these out of servicers. What if you've got a money mailer or a ValPack zone that you're mailing to the area that, that you don't even service. So I get excited and get all into this stuff.

Josh Smith (12:04):

I love it. Well, you need more of that. That's a big challenge for a lot of them serve as professionals right now is the recruiting aspect and, uh, having a process in place. I think you outlined it awesome. It was beautiful style. You outlined a lot of people don't have a process for who they're bringing on boards of their team and they wonder why they can't retain techs. Speaking of that, retaining techs, are there certain things you put in place to not only obviously recruit texts, but to retain them and make sure they're, they're engaged and they're on board for the long run.

Tommy Mello (12:32):

So we have 27 manuals, all for different roles. My tech manuals, 59 pages. It goes from everything of, you know, you expect these people to come work for you. And then you get mad when they don't do exactly. You gotta teach them how to play the game. So you need standard operating procedures and policies. And I think manuals, they literally die on shelves. Our manual gets read every single week. We go through four pages of the manual and you got to teach them how to win the game. So we teach them how to win the game. We give them health insurance. We give them a vehicle. We give them an iPad. We give them, we've got pet insurance, but really incentivize them to make as much money as they want. You know, you're going to make six figures your second year working for me and then give them a ladder to succeed.

Tommy Mello (13:13):

So they start out as an apprentice. They can move up to a junior tech tech, senior tech field supervisor. And I learned a lot of this stuff from Lev. He was a consultant of mine for a while. He's really, really good. He taught me a lot. I'm not as patient as him. I'm more of a marketer and sales guy. So I'm macro. But luckily I have a lot of great people around me. We built an amazing team. So give them goals each week, find out what they care about. You don't find out. Why do you need to make a hundred thousand? Do you want to have your mother come visit? Do you want to take your kids pay for their college? Do you trying to get a new vehicle? You going on a big hunting trip, whatever that looks like and keep them motivated by setting goals, we have a morning mojo call every single morning where we go over all the numbers in every single market.

Tommy Mello (13:57):

And we set goals. We talk about the big wins from yesterday. We talk about conversion rate service to sales. We talk about how in the heck did you do this ticket? So I'll say Josh do me a favor, man. You murdered it yesterday. Why don't you spend five minutes and tell us what you did. What clicked in your head? What was the paradigm shift? And then these guys go and they listen to when they call each other all day and they just get pumped. It's like a family here. And I think, you know, a lot of business owners, they don't have the collaboration. They don't have the communication. They don't have the goal setting. They don't have the numbers, service, Titans, an amazing tool. And that's another thing is I think you've got to have an amazing CRM. We have 4,300 call tracking numbers, 4,300 call tracking numbers. And I know down to the T what's going on in this business. And I think that's important. A lot of business owners don't have the time or patience. So

Josh Smith (14:46):

Yeah, absolutely. Then what, what are some of the things that you teach your staff for dealing with customers in person, regardless of the crisis and anything else that's going on? What do they need to pay attention to?

Tommy Mello (14:58):

Number one, be a questions. Always ask questions. Josh is a beautiful home. How long have you lived here? Collecting data. Oh, tell me exactly what's going on with the door. Well, I know what's going on to see a broken spring, but I want you to tell me, let me ask you this. When was the last time you had this looked at? I spent 20 minutes with them before I even start to talk about the garage where I pet the dog. I'm talking about their 10 equipment that Harley Davidson. This is super cool and I get into it and then they become their friend. And if I'm doing a sell, I always say, is there a spot we could sit and talk about this. I don't want to be the only guy that sits at the kitchen table. And another thing I can tell you, I've got a whole sales manual.

Tommy Mello (15:36):

Start the job they call you out for a bottom rubber on your garage door. Don't go in there and do a 28 point inspection before you start the work. I always tell people and I do this every time I say, get them to decide to use you first. They called you out for a bottom rubber, do the bottom rubber. So many people blow the sale. So get to know the customers is really, really, really, really important. And then the second thing is follow up. You have to follow up. Most people fail completely and miserably that are listening to this call. I can tell you right now, tell me your followup process. What are you doing? Make sure you're following up. Those are some of the things

Josh Smith (16:12):

I remember talking with some of the regional directors of, uh, some of the franchises that we've worked with. And, uh, that was one of the biggest topics of discussion was the follow-up you listened to all the calls and the calls are great calls and they got people going out. They have appointments, but then their sales are down. And the first thing we flip to is a follow-up and he was just like, yeah, he's like, not a lot of our guys. Are they really struggled with followup? You wonder what's broken. So you have to, you have to follow up. You've got to stay engaged. Be top of mind.

Tommy Mello (16:41):

Yeah. Dopamine Tomo, top of mind awareness. And I'll tell you this with all the technology out there, Twilio, which is a type of messaging. We've got abilities to set campaigns with voicemail, blast, follow up email blast. And it's like, if you leverage technology right, then you get murder it. So I think leveraging, I mean, we skip trace certain customers. We find out the LLC name. We go to a construction monitor. We find out the LLC, find out the owner, skip, trace him and send him a piece of mail to his house. I mean, that's, what's available out there. But most companies, the problem is Josh is most guys are a technician. They decide their reason why, the reason they started a business because they didn't want to work for someone else. And I'm going to tell you this, I hope I'm not offending anybody right now, but I, I can't stand the people that get on Facebook on their forums.

Tommy Mello (17:28):

And they say, this company charges too much. I'm like this number one, who's the biggest company in your city, the biggest air condition company. Then my second question is who charges the most, same company, because they could afford to do billboards and advertising. And they've got nice wrap trucks and they pay their people. The right they've got great CRMs. I see people all the time. They say, well, service site is so expensive. I'm like, it's less than a fraction of 1% because of my revenue. If I could get 1% higher booking rate, I paid for this all day. So

Josh Smith (17:57):

Absolutely. So where are you taking the business? How are you getting it to the next level? What's the five-year plan look like?

Tommy Mello (18:04):

So a billion is what I want, but how do I get to a billion? It's pretty simple. Really is you got to figure out, write a billion down and then say, what's my average technician. 750,000 and then reverse engineer. How many guys do I need to get to a billion? And then I said, wait a minute. I'm going to have to have full time recruiters. So I've got two full-time recruiters, two full-time trainers. I've got a learning management system. We're always recruiting. We're always looking for great talent. So start with the end in mind. There's a book here. So I'll start with the end. If you figure out where you want to go, then just reverse engineer it and act like the company you want to be. If you're only a two man show, you got to act like you got to figure out how to get out of the field. First of all, you got to figure out how to pass the skills on a train. People and retention is a huge deal. Cause I know people that are good at hiring, but they're always losing people. And I think it's because a lot of people that are underpaid because you should see all the stuff we do to figure out the best way to pay our guys, to make the maximum amount and still be fair to the customer. You know, you don't want to rip off grandma. Like a lot of these companies do so

Josh Smith (19:14):

Awesome. Hey, this has been awesome, Tommy. I really appreciate all the insights. If you had any leave, one thing in the mind of everybody who's listening right now, what would that piece of advice be?

Tommy Mello (19:25):

And this is the best piece of advice I've ever got in my life is I found companies that I want to be like, and I flew out and I literally asked a million questions and I fly out all the time. I find these 150 $200 million companies. And I go ask the owner a million questions and tell them how much I appreciate them. Send them gifts through Amazon. And then I listened to books and I listened to podcasts and I'm always learning. And I, not the company you want to be like and ask them questions and trust me, successful. People will answer all the questions you have. Don't be afraid to fly out to Florida or fly out to Detroit or wherever you might want to go to find a big company and go there and live the life that they live for a few days. It'll change your whole mindset. Yeah. I just think that to me, I've got 850 books on my audible and I'm just looked at that. That's all I do is listen to audio books and go visit huge companies. So

Josh Smith (20:19):

There you go, Tommy, this has been awesome. I really appreciate all your time and taking the time out of your busy schedule to drop some awesome information nuggets here on the podcast. Where can people find out more about you find out more about your book?

Tommy Mello (20:30):

Yeah. So on audible, the home service millionaire, it's better on audible. You could order it on Amazon or go to home service, millionaire.com. I'd narrated it myself. The home service expert. We're about 15 to 20,000 downloads depending on the month of great stuff there. And then my email address, I'll just give my generic one. It's a one lead Lea D manager at Gmail, a one lead manager@gmail.com. And I'm an open book. If anybody needs help Scott questions, don't hesitate to reach out.

Josh Smith (20:59):

That's awesome. Appreciate it, Tommy. We'll have to have you back soon. All right. Thanks

Tommy Mello (21:03):

Josh. Appreciate you.

Josh Smith (21:04):

Thanks again for everybody listening. Definitely hit the like button wherever you might be listening at and definitely tap that subscribe button so you can continue to get more of this awesome content over the sharpest tool. Hope everybody's doing well, staying safe. And until next time we'll talk to you then next.

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