How Sera Is Disrupting The CRM Market For HVAC, Plumbing & Electrical Contractors

How Sera Is Disrupting The CRM Market For HVAC, Plumbing & Electrical Contractors

Announcer: Are you looking for valuable business advice to reach that seven-figure revenue mark? Do you want actionable tips to properly navigate every business challenge you encounter along the way? Let Tersh Blissett and Josh Crouch be your guide in getting you to the top here at Service Business Mastery Podcast. Tune in as they sit down with world-renowned authors and business leadership and personal growth who share valuable insights about management, marketing, pricing, human resources, and so much more. Let their nuggets of wisdom goals guide you in owning a thriving, profitable, and ever-growing business. Here are your hosts, Tersh and Josh.

Tersh Blissett: Hello, everyone out there in the podcast world. Happy having a wonderful day. You’re listening to or watching Service Business Mastery Podcast. We’re live here at the service hero. No. Serve it. Yes, I did [00:01:00] get that right service hero 10x events in Vegas, and I have the awesome team here from Sera. If you’re not familiar with Sera, you’re probably living under a rock if you’re in any of the Facebook groups. You have heard they’re disrupting all of the technology as far as CRM goes, and I’m super excited to have these guys on the show and have a conversation about what’s in the future and what’s to come. And yeah, I mean, with that being said, let me welcome these guys to the show. What’s up, guys, what’s up?

Billy Stevens: Hey, what’s happening?

Tersh Blissett: Good to see you, man. How are you all today? Are you good? Yeah, day to day two of this event?

Billy Stevens: Absolutely. Yeah.

Tersh Blissett: Second day. Yeah.

Chris Folmar: It’s nice that you’re tired. It’s been nonstop. It’s just been crazy. So many people are coming up, and they see the Sera shooting like, Oh, it’s Billy. No, it’s not. I’m not sorry. I’m not Billy. So, yeah, people are excited about knowing what it’s about.

Tersh Blissett: So [00:02:00] tell us what? What is Sera for those who do not know what it is?

Chris Folmar: So Sera is a new system designed to help run your kind of your fleet, field service management and it but a little bit different than other systems, which Sera is designed to actually work in the business. So your team can work on the business. So it’s got several patents pending that are on the way. We use automated intelligent design inside the processes to reduce redundancies to cut down on time cut down on touchpoints. Just so like, say, all of your team can be focused solely on the most important thing, which is how do you drive revenue or profitability? So Sarah handles a lot of the redundant back-end processes, so humans don’t have to touch it.

Tersh Blissett: So I hear a lot in the group, a lot of people are talking about A.I. despatching. That’s what I hear a lot like. You don’t have to worry about this stuff. It just figures it out for you. How does that work? Like how, how [00:03:00] like and do we have to have 50 or 60 technicians for this to work? Or can we can it work with a smaller team?

Billy Stevens: Oh, it can absolutely work for a smaller team all the way up to, you know, 100 or more trucks? Yeah. What it does is the inputs that we use and that we show you that you need to put in to determine the difference between good calls that are valuable that can return a higher margin for you versus calls that maybe you’re doing those instead of the better calls. Sera can figure out that, Hey, I’ve got a 15 year old air conditioner here. Your dispatchers already said we can’t take any more calls, but if she recognizes the fact that there’s a four or five tune-ups on there for a six or seven year old system, and so we’re going to punt one of those tune-ups and we’re going to go do that 15 year old system. One of the things people don’t like to do is make that call, you know, Oh, yeah, sorry, I got to reschedule

Tersh Blissett: Or whatever the empathy you just missed your CSRs [00:04:00] or dispatchers, they they they want to be empathetic. We teach them constantly, show empathy, show that you care about them, and then we’ve scheduled it. We’ve we finally nailed it down. That’s a that’s a challenge in itself of getting someone scheduled for their maintenance like, look how you paid for this thing six months ago or a year ago. Let’s get it scheduled and then you get them on the schedule and then we’re like, Oh crap, we’re going to we’re going to boot you off. And then so yeah, I could totally see that on the the the the CSR side of things. Now they are having to do the CSR, having to call the the homeowner, I’m guessing as

Billy Stevens: Well we can notify the customer if there’s a delay or whatever. But you know, that’s when we need to make the phone call, in my opinion. Yeah, we don’t take away all the work. Ok, we we leave. We don’t do that, right? No, I’m talking about. We just take away the time wasting redundant stuff and we just do some thought logic, you know, about how these businesses run every day. And we built that in [00:05:00] there and we we’ve been seeing a lot of results now. One thing about it, it’s a one dimensional question that everybody’s talking about. Yeah, is the dispatcher, but it doesn’t work unless the the tech app works along with it.

Tersh Blissett: Ok, so explain what you mean there.

Billy Stevens: So we have three three phases of our software. We have the admin tech app and then we have the the marketing and all that stuff. Okay. And so what we do is to make this technology work. We need to know what the tech’s doing at all time, and we have to get the text to run in a certain way through the tech app and everybody be consistent. One of the things that wait

Tersh Blissett: A minute, wait a minute. So the techs are going to do what they’re supposed to do like,

Billy Stevens: Absolutely, they’re going to do what they’re supposed to

Tersh Blissett: Do. I mean, we’ve all had the little challenge here and there of like not getting forms completed and you take pictures of the data plates and right.

Billy Stevens: So think about [00:06:00] it like this. Do you really need a form if you if you run through a call the right way and get the information as, yeah,

Tersh Blissett: As long as as long? So here’s the challenge that I faced. And so I created some forms and I’m really proud of my forms. But I’m also a nerd when it comes to excel. So like, put that out there to start with. But like, I was having questions from homeowners about the call and the the invoice or the the the ticket that gets emailed to them. It was very generic, so it was very much like a arrived on site. Found back, Pastor James Capacitor, goodbye. That’s how it like the invoice was worded and everything else. So I’m like, I don’t know what your pressure is. I ain’t got a clue what your pressure is like. I can’t, I can’t. No deductive reasoning at all on my end. So it’s very much like crap. I don’t know it, so I have to call the guy. And hopefully he remembers. So then I created a form of the processes [00:07:00] like order of operation and to start filling this form out. And if somebody calls me, then I can hopefully find right.

Everett Lippel: So, so so you get your check up checkup form, right? You’ve got all your check points, right? So I love that data. Put it together, right? So so what’s nice about the process that Billy is talking about? What really turned me on and I thought it was just so cool is that the flow through on the tech app brings you straight through. There’s nothing preventing you from doing that and then just snapping the picture of that form. In fact, if I was running a business, I would do it exactly that way. I would actually say, and I know that I know Billy likes less touches, less intervention, like super simplified. I’m saying if you need that information to run your business, there’s nothing preventing you from taking that picture and having it on every single call and having that as a part of your process on every call, which again, I would definitely

Tersh Blissett: Recommend I do. I do love the less is more mentality because whenever we’re onboarding new people, it’s a lot easier to onboard someone. Whenever there’s a simplification [00:08:00] of processes for us, it’s a it’s a challenge. The ride along is very specific because it’s like, Hey, look, we’re not a normal air conditioning company. We’re not this isn’t how normal plumbing companies kind of go through here with an iPad or your phone and you’re like, We expect you to take photos of all of this stuff, and I get that. I understand that. So if I could find a happy medium, I would. I’d be. I’d love that one hundred percent. I just want I need data so that if I’m ever asked, I don’t look like a fool or sound like a fool on the phone, you know? Does that make sense?

Chris Folmar: Let me ask you this How do you how do you enforce consistency?

Tersh Blissett: Debrief forms? So our another form, our debrief form that the technicians fill out, they complete it at the end of every service call. So it’s two thirds of it the technician completes and integrity first is one of our core values. And so it’s one of those things where they have to sign it, saying at the bottom of it, stating that everything that they [00:09:00] put, all the data they inputted was accurate and to the best of their abilities and then at the bottom of the form. So basically, this is our process. They complete their portion of the debrief form, which says, Did you get the model and serial numbers? Did you add all of it to the program? Did you take photos and add them to the marketing channel of teams? Because that’s what we use for internal communication. And then do we need? What’s the what’s the future like? These are our future. What do we need to do in the with the client? Do any ordering parts? Do we use truck stock? I mean, it goes through like pretty redundant. And then the dispatcher at the end of it says, basically how many hours we’re built for the job? How much time was on the job? Did they give a discount? Was it approved by Tersh? And then did they fill out all their shit, right? Basically, you know what I mean? And so they fill out other stuff, and then she sees it real quick and then, you know, it helps speed up that part of the process. [00:10:00] But that’s the way that we create consistency there because they know that they’re going to be asked that question. And if it’s not, it comes straight to me.

Everett Lippel: You know, I was going to I mentioned to say this. So he was talking about the process in which you go through to, you know, your checkpoints, your your your process of the call. So is sort of design that you have to go through those steps. It will not allow you to get to the next call. You cannot end the call, right? So and in the end, when you’re in your appointment, which really kind of cool, it comes up with what you’re talking about. It’s a checkbox of, Hey, did you do this? Did you do this? What did you do? But it’s not, you know like you’re saying, it’s a whole long-form, right? Right, right. So but what I’m saying is, is they have to follow the process in order to get to their next call. Mm-hmm. It’s pretty. It’s pretty neat. That is really cool. Did I say that right, Billy? Do you like that or do you want to set it?

Tersh Blissett: Said it very well.

Billy Stevens: Ok, OK. This guy’s been all over the software for ever since he saw it about a month ago. You may know more about it than me by now.

Everett Lippel: Most definitely do not.

Tersh Blissett: So [00:11:00] let me ask you this what is in the pipeline like? What, what’s coming in the future? Because I know some really cool stuff is coming, and it was really cool because Chris and I, we just happened to I mean, I bumped into Billy last night at the black tie event, and I was he introduced me to Chris and I was like, Oh, this is cool. Like then we started nerding out on some stuff and and I want to know, like, what’s the future of Sarah? How fast are we thinking this is this is going to move along here?

Billy Stevens: One of the things that was said yesterday is we’re thirty one percent productive in the workforce

Tersh Blissett: And in general. You know, in our

Billy Stevens: Industry, yeah, I think Matt, Judge, and Judge said that yesterday. Thirty-one percent efficiency, 20 percent. And then what our thought process is and what we’ve been using at Billy Go, our beta company, and the companies that are already on this on Sarah is what if you could charge for every minute of everyone’s time, every day, all year long?

Tersh Blissett: Well, that’s a perfect world. Yeah, right?

Billy Stevens: Yeah. Well, that’s what’s [00:12:00] coming. Ok, we want to be able to charge for every minute and know that we’re charging for every minute or be a hundred percent efficient. Are we 80 percent efficient? And if we are 80 percent efficient, how do we become 100 percent efficient with the information we’re given?

Tersh Blissett: So it sounds like there’s a an a percentage of almost coaching built into this as well.

Billy Stevens: There’s a lot of coaching into it. It’s a straight path. It’s not a zigzag. You know, what will this work? Will that work? I’ve already done all that. I’ve made all the mistakes for everybody. Ok, but that’s

Tersh Blissett: So much fun. Though, Like, yeah, I hate pulling. I mean, I love pulling my hair out. That’s why I’m bald. So good cover there. Yeah, it’s one of those things where it’s like, there’s a lot of uncertainty surrounding our my numbers accurate is are we being productive? The guys are busy, the guys and gals are busy all day long, so we must be making money. But then my checking account, it’s kind of hurting, you know? So [00:13:00] a lot of people are great technicians, but they’re not great accountants, and so they don’t know how to read pals, or maybe they’re not the best at it, so they don’t know what they’re gross. I mean, they’re going off of what their accountant says the 10th or hopefully the 15th of the next month before they’re like, Oh yeah, last month you didn’t. You sucked.

Billy Stevens: You know, one of the requirements that we asked for if you go on, Sarah, is that we look at your financials and we walk you through them with your CPA and we rearrange items where they should be. For instance, credit card fee stuff like that shouldn’t be an overhead item. Those are those are cost items. You never received that money. But yet, but yet you’re building your cost on the fact that you did

Tersh Blissett: Right in discounts and though,

Billy Stevens: And discounts. And one of the things when I first met Victor, you know, he goes, Well, look at my financials. I’ve got this great big business and I’m really I’m really struggling. I’m making the money that I want to make. Mm hmm. And in about three minutes, I found about $2 million.

Tersh Blissett: Yikes, [00:14:00] right? And that’s good, too, right?

Billy Stevens: And and the thing is that I can go and look at anybody’s financials because I know what I’m looking for and we and I can dissect it in about two or three minutes and say, Look, this is what you need to focus on and let’s focus on this and then we’ll go to the next thing. And I want you to do this every month. I want you to understand that you’re no longer the daily KPIs that we are always seeing. Those don’t tell you a story, they’re just a snapshot. That’s a picture. That’s all it is. And your financials tell you how you and your business are and you’re a reflection of your business. So are you being successful or not? True? And that’s what we do is we help you get your financials in order. We built Sarah in a way that everything that we do, how we price the task, how we do all that stuff goes right to the P&L with the purpose. So if you want to have a sixty sixty five percent gross margin and you want to have 100 percent efficiency, what are you going to get? You’re going to get your sixty sixty five, right? Yeah. And I tell everybody that, you know, I was able [00:15:00] to do twenty four point four percent even, but

Tersh Blissett: I seen that, yeah,

Billy Stevens: You know, back in the day. And so everyone’s financials has that EBITDA in them already. It’s already there. You just got to pull it out, right? And that’s what we do.

Tersh Blissett: So are you going to is this going to integrate with Kubo or are you going to have an accounting program in

Billy Stevens: At some point, we’ll we’ll have something to integrate with, you know, a larger, better QuickBooks? Right? Well, we have no, no, no, no. We’ve got QuickBooks. Yeah, we can do online. We can do all. Oh, OK,

Chris Folmar: Yeah, you got desktop online with

Billy Stevens: Apologize.

Tersh Blissett: Ok, yeah. So you’re going to you’re you’re going to do an in-house or like an IM program type accounting.

Billy Stevens: No, no, no. We’re never going to be accounting process. No, we have no reason.

Tersh Blissett: That seems like a big that’s quick. That’s QuickBooks, right? Yeah, right. They do a good job and it’s like fifty bucks a month or a hundred bucks, whatever, because it’s too cheap.

Chris Folmar: No, I think I think the better way to say that is that, you know, QuickBooks Desktop, QuickBooks Online, we have right now and others will be coming soon. I Gotcha.

Tersh Blissett: Yeah, absolutely. Like Peach Tree or whatever peach tree zero. [00:16:00]

Chris Folmar: You know, there’s a lot of those that we’re looking at and finding some good ways to have some lightweight integration. I love

Tersh Blissett: Cloud stuff. I know I know QuickBooks Online has its limitations, and going from enterprise to QuickBooks Online, it’s a challenge. But I absolutely love the fact that I can literally pull up my entire business right here and I can I can see it all there. And so running remotely, I have to run on QuickBooks Online,

Billy Stevens: And it’s very important that you have the right information going in there and not having to change everything as before

Tersh Blissett: You put it in garbage in garbage out,

Billy Stevens: Right? And so, you know, we worked really hard on making sure that. Dashboard is accurate and it’s live, and so there’s no delay if you close a thousand dollar job, you know it immediately updates.

Chris Folmar: So that’s the thing you say. It’s live. A lot of people will talk about real time data, but they mean real time, like after the badge.

Tersh Blissett: Yeah, right? So is it a two way batch or is it a single batch or is there like constant communication?

Chris Folmar: It’s like this. So this constant also this everything that we’re doing, we have the the product [00:17:00] philosophy of it’s got to be timely, relevant and actionable.

Tersh Blissett: Wait a minute. So like at the end of the two week payroll period, when we decide to finally batch it, that’s whenever is accurate, data is there. That’s not going to be the case there.

Billy Stevens: No, that’s not the case.

Chris Folmar: Look, some people can take that approach and maybe they’ll find success with it. But but Billy’s been really clear for us that people need actionable data that they can look at that it changes within the minute. That’s fine. You know, everything that I was talking about earlier about being being able to track to the minute how people are working in order to get to that actionable data, you have to have that. So everything that we’re doing right now from the product development is and how we track the what each resource on the job is doing. And then you can compare that to what’s the what’s the target time as your as your main unit?

Tersh Blissett: Okay. Yeah. And we talked about this a little bit last night. You and I did the the national average, which most price books are built off of some sort of national average. And you have to go in and deal with it. You’re going to have a price book internal correct. So we [00:18:00]

Chris Folmar: Are we already have

Tersh Blissett: To have a price book. Oh, OK. And how difficult in in how exhaustive is the process of setting up the price book?

Billy Stevens: Well, we’ve introduced a product just this past week on Wednesday, I believe. And drumroll, if you yeah. And so one of the things we introduced this week was you can change parts out. If you change vendors, all you need is the SKU number and the price to change it, and you can download it into our price book. It’s about a 90 second process once you do that and now there’s a way to if you have a half inch, 90 elbow or something like that right in 70 different tasks, you don’t have to go to each task and put it in there. Sarah will put it in those 70 tasks with just a push of a button. Oh, OK, that’s cool. Yeah.

Tersh Blissett: And how about the actual images? Do they show up anywhere? Like, do you have an image of a product that would show up on an estimate or anything like that? [00:19:00]

Billy Stevens: Is that

Tersh Blissett: Something we’re going to have to do or anything

Billy Stevens: Like that? No. We have a philosophy that if we’re going to sell something to someone, let’s show them the really bad one.

Tersh Blissett: Oh, yeah, yeah, right?

Billy Stevens: Would we show them the new one

Tersh Blissett: Shiny new

Billy Stevens: Stuff? Why don’t we want to show them that? Who cares about an air conditioner and what it looks like, right?

Tersh Blissett: When it’s not to mention it’s going to change? Or if whenever I here’s the thing that the challenge that I have and it doesn’t happen a lot, but whenever I show a next V20 system and it’s got the shiny the top on it, the leaf guard, and then all of a sudden they get an 18 and they’re like, Well, where’s my top hat? Like, the picture had a top on it. I’m like, Damn. Like you just it was a stock image that somebody was just standing next to. And so it’s like that becomes a challenge, for sure.

Everett Lippel: I’m not really sure how impactful it is. So I, you know, I spent 10 years in houses highly successful. I worked for $70 million HVAC company, right? And you know, over the course of I could tell you right now, I mean, show and tell is cool. Real pictures and on [00:20:00] real jobs can be impactful. The wrong way to do it can be impactful. But the simplicity of Sarah in the way that it works is it doesn’t need the shiny bells and whistles for it to be highly, highly effective. And there’s something really, I think, sort of just just effective about being simple about your approach in something, right?

Tersh Blissett: Yeah, I mean, it’s just like you said earlier, it’s a simple simplicity approach. It’s obviously the way as you’re taking this.

Billy Stevens: Yeah, so what I’ve visited with hundreds of companies back when we were buying companies back in the early days and, you know, shopping around.

Tersh Blissett: So for anybody that’s listening, they may not know that you actually been in the industry and done this a time or two.

Billy Stevens: Oh, absolutely. I started in ninety six in the industry, didn’t really know anything about it. Think at the end of the day that was the best thing because I had to create my own way. And by doing that, I come up with a lot of ideas on how I wanted to run a business. Mm hmm. And so, yeah, I’ve been around the block quite a while. [00:21:00]

Tersh Blissett: So, yeah,

Billy Stevens: Yeah, not the young guy anymore, that’s for sure.

Tersh Blissett: That’s Cool Deal Cool Deal. So it sounds like they’re wrapping up the thing. So it’s going to get real out in here. So with that being said, closing comments, what’s the what’s the next thing we should be looking for to be released?

Billy Stevens: The next thing we’re going to release is a big whole batch of reports that are easy to read and easy to see. And right there, you don’t need to build spreadsheets. All the numbers are accurate. We understand the difference between a job that you’re going to make money on and a warranty.

Tersh Blissett: And so with the with the gross profit. Knowing your gross profit numbers and communicating real time with QuickBooks and everything. How how I guess my question is like, how do we have the checks and balances that we’re actually getting accurate data in, like because we know that you can have inaccurate invoices and POS [00:22:00] systems and not putting POS in properly. And so then you know what I’m saying, right?

Billy Stevens: That’s more of an accounting question, maybe, yeah.

Chris Folmar: Well, like any system, I mean, depending on if you’ve got good accounting practices, if you’ve got good discipline for that, it’s like any computer of garbage in garbage out. Sure. But in terms of the reports that are coming out, you know, one of the things that we’re held to a high standard of by that guy is that it’s got to be kind of within this tight circle of It’s must have in the world of product development, right? So we have this is must haves. This is nice to have. This is really cool as heck. Yeah. You know, stuff, we’re not allowed to go to

Tersh Blissett: That last one.

Chris Folmar: No, we have to live in the world of must haves. Ok. The nice tabs are stuff that we talk about and that can plan for. But if it’s not like laser focused, you know, Billy is always saying focused features. That’s it. Focus on simple

Tersh Blissett: Simplicity is what it

Chris Folmar: Is. We are always we are trying to figure. It’s like, how do we reduce It’s? How do we [00:23:00] cut down the number of steps? That’s why our onboarding is fast. That’s why the ramp up time to become knowledgeable and comfortable using this thing is days, not weeks or months or months or longer. So it really is. And so and that’s and that’s what’s kind of cool about the team is that our culture is that we’re constantly all reinforcing ourselves about that. How do we how do we simplify it? How do we discard the unnecessary and just get it down to the point that this is useful? This is useful now.

Tersh Blissett: Yeah, yeah.

Everett Lippel: Billy pointed out earlier and he said something he was like talking about this box, right? Like keeping keeping Ray. So the focus, whatever he talks about the software, it’s not so much about the bells and whistles. It’s usually about. Like, How do we help these companies become more profitable? Hmm. And that’s what we want.

Tersh Blissett: I mean, we didn’t do this. We didn’t get into the business to give away money. Well, most of us didn’t. I mean, it’s not a philosophical adventure. We were here to make money, you know, so some charity work, the last I was, the last I heard, we’re not supposed to be doing it that way anyway. So [00:24:00] I mean, there are lots of us that that might get some negative net profits at the end of the year. But no, I’m just kidding. But our whole target here is to get some money and make money. I mean, we are risk, we’re taking massive risk and so we should be rewarded for it. Sure.

Billy Stevens: That’s right. And the philosophy now is if I need more money, I just keep raising my prices. And then your sales go. Then your close rate goes down, right? And if you have all your numbers right internally in the middle of the business, you know on that P&L, you don’t have to be the highest guy in town to make that margin that you want because you cleaned up the mess in your business.

Tersh Blissett: Good way to think about right?

Billy Stevens: And so Billy Go goes to market against everyone in town, and we’re consistently two to three thousand dollars cheaper on a new system, but we make a twenty six point one EBIT off of our everything that we do. Mm hmm. And and the reason why is because we have very low costs. We understand, you know, what it takes to go to market. We have our customers pay for all of our marketing. We don’t. We don’t pay for marketing.

Tersh Blissett: Yeah, we really didn’t even touch on marketing, [00:25:00] but that’s a whole a whole other leg of the program, too, right? I mean,

Billy Stevens: Memberships. Well, no matter what you’ve heard about memberships, they’re not a profit center. There are big business building product.

Tersh Blissett: Ok. Right? What do you mean? What do you mean by that?

Billy Stevens: What I mean by that is is back in 2003 had just come out of 911. We just come out of 911 and we had a big uptick in business because everybody was staying home. Sound kind of film.

Tersh Blissett: Right? Yeah.

Billy Stevens: And of course, it didn’t last as long as this one. And then it lasted about a year. And as soon as everybody got comfortable and we started going back to normal, life business dropped about 50 percent because because everybody selling fixed every, you know, they fixed what they wanted to fix their home, right? And if we didn’t make money, then we were in trouble and a lot of businesses lost that they lost business. And businesses in that 2003 2004. And then right behind that, we had the house crash, right?

Tersh Blissett: Yeah. 08 seven.

Billy Stevens: And during that entire time, we were growing by double digits.

Tersh Blissett: The whole [00:26:00] time,

Billy Stevens: The whole time never slowed down. You know, we did take a pretty big dip, you know, right afterward. And then that’s when I created membership’s. And that’s how that’s how I saved the company, really. I literally saved the company because, you know, every company goes through that day where you’re like, Oh my gosh, are we going to make this or not, right? And you know, I just thought, What? What do I need to do? I need some loyalty here. We didn’t have Google, we didn’t have any of that stuff, you know, and I need to create some loyalty. And I went to my team and I said, We’re going to do a $99 membership. It’s not going to be a contract. It’s not going to be a service agreement. It’s a membership. Mm-hmm. And in that membership, they’re going to get 15 percent off of the price. However, that 15 percent off price is the margin we need to make. So we present it in a nonmember and a member price, and the member price is the price that we need to make it right. And so we started giving these ninety nine dollars memberships away and all paying paying for those, and we sold six thousand [00:27:00] of those things in the first year and save the business.

Tersh Blissett: Wow, that’s crazy. Now did you already have 6000 clients? I mean, yeah,

Billy Stevens: We had a fairly sized business, but when we started offering these memberships, they go to my mom and dad, get one of these.

Tersh Blissett: Oh, that’s cool. So it was beginning. I entered the industry in 05 and we were rocking and rolling with memberships at that time ish. We were definitely pushing it hard at that time, but it sounds like you were pretty on the forefront of memberships.

Billy Stevens: And we were we wanted to gather memberships because members had air conditioners and we needed to see those air conditioners. And fortunately, in Dallas, Texas, there’s about two point to two point five air conditioners in every home. So we had 6000 memberships. That’s good. In the

Tersh Blissett: First ninety-nine dollars was no matter how many AC

Billy Stevens: Units, no matter how many AC units did not matter the same way because it got us in the door twice a year. All tune up in the spring up.

Tersh Blissett: And if you do a tune up properly, you know you’re going to find stuff around with it.

Billy Stevens: The other thing it created a 12 month [00:28:00] a year business. I didn’t have to earn all my money and then spend it in the off-season.

Tersh Blissett: Yeah, good point.

Billy Stevens: Yeah, yeah. And so because we had so much work to do every winter, we could hire the best guys that everybody was busy. Yeah, they couldn’t keep them busy. So we kept growing because we hired when no one else was hiring.

Tersh Blissett: Ok, so let me ask you this about memberships, and this is completely off topic from Sarah and everything else, but monthly membership fees or yearly.

Everett Lippel: We disagree on this, by

Tersh Blissett: The way, we definitely disagree on this. I want to tell you, you want to make your argument for

Billy Stevens: I to make money. I’m going to make my argument first. So once a year and I’ll tell you why. Because you give a customer 12 times the opportunity to

Tersh Blissett: Cancel or lose or change credit cards or fraud,

Billy Stevens: Whatever it is, it’s once a year and you do it on the point of sale. And every time you go to that customer, you show them the member’s savings. You’ve already got them right and you continue to show them those member saving savings.

Tersh Blissett: So what about the challenge [00:29:00] of stay in line right now versus like you’re having that nine dollars or one point ninety nine or twelve dollars or fifteen dollars?

Everett Lippel: So I’m with you on this. So and this is something that came from, you know, in the world of the SDGs and the next hour is the world right, which is, you know, we’re so preprogramed with Netflix and you know, these different members now nowadays with these membership programs that were just, you’re OK. So the average is not going to be ninety nine dollars, most people are going to charge one hundred and eighty nine hundred and fifty nine dollars a year for a membership, right? A lot of times they’re going to charge extra for the extra system in the house. So now it might be, you know, you know, you’ve run calls where you have three four systems in the house and now it’s like, Oh, well, it’s a four or five hundred dollar nut. When you come out there, it’s a lot easier to be like, sir, it’s nine ninety nine a month or it’s 12 nine nine a month, and there’s so less likely to cancel. And what you do and this was a trick. We sort of not a trick, but so credit cards change, right? But try to get it on right on a checking account as opposed to getting it on the credit card so that it’s [00:30:00] less likely. And then they really have to call or you really have to call into the cancel or whatever it is. You know, I’m not saying I’m saying it’s a good business practice. I think it also. Saves on the fees. Yeah, so we you saw a big uptick in some companies, one company that I was with you saw a big uptick in just the retention rate of people because when you went in there and you tried to get them on that annual and it was two hundred bucks, they’d be like, No, I’m not right now, I’m not going to do it this year. And that was the only that’s the only trade off. There’s no wrong answer for it. It’s just a philosophy difference.

Billy Stevens: So if you’re trying to build a business, you need to own your backyard. Sure, the best way to own your backyard is membership, right? Yeah, yeah. And if you have six thousand memberships paying you ninety nine dollars a year, that’s not 60 grand. That’s 600 grand.

Tersh Blissett: Mm hmm.

Billy Stevens: Right, right. That’s six hundred thousand dollars at a two-point.

Tersh Blissett: And that’s that’s that is before you’ve gone out there and done any any

Billy Stevens: Maintenance that is correct. And you know, we were suffering with about $3 million business. And all of a sudden we created $600000 worth of revenue and it did nothing for it. And we took that. We took that money. And we, if you [00:31:00] do the 12-year rule, right? So let’s just say there are twelve thousand air conditioners in this case. In that first year, eight percent It’s to every 12 years. And so that’s nine hundred and sixty air conditioners that are going to fail.

Tersh Blissett: But so here’s a challenge. Ok, what happens if your business like your technicians? And now I’m going to tell you, I’m going to say this, this is not because this is how our business is, but I know that there’s people out there. They go there and is zero dollar tickets every single time. All the time, it’s like you’re going there. You don’t flip leads. You don’t find a capacitor bad like you don’t. The drain, like you don’t need a secondary float switch. Like there’s nothing

Everett Lippel: They’re not having. They’re not having the conversation.

Tersh Blissett: Yeah, no conversation. They’re getting in the attic and they’re banging. They’re sitting on the air handler and banging on it and then getting out, you know? So what? I guess my biggest thing is is like you because you’re doing ninety-nine dollars and [00:32:00] we know it would cost more ninety-nine dollars for the technician to roll up in there with overheads and everything, you have to make sure you’re managing it all the way, the entire process. You can’t just get your six hundred K and then say, All right, we’re about to get rich here. Like, you have to make sure you’re managing every single service call. And oh,

Billy Stevens: Absolutely. Yeah, you just can’t show, not show up at all. Yeah, even even though you showed up.

Tersh Blissett: Right, exactly. And that’s basically what you did. And and there’s a lot of technicians who have the mindset of, well, they just paid this money. They they’re not going to want to pay more money. Well, I’ll tell you from my personal experience I have, I have a Dodge RAM Cummins diesel and it’s got this lift kit and deleted everything else. I mean, it’s got all kind of stuff done to it. Power steering pump on it has been whining for six months now. If you take it to get the oil changed in it monthly every other month because of how much we were driving. Not one time did they ever say anything about the power steering pump and I don’t think about it. [00:33:00] Julie’s actually who takes it for me, and then I get back and I crank up the truck and I go to drive out the driveway and I’m like, Go like, why did they not? I don’t care if it was a thousand dollars. Just get the thing fixed, like because I don’t want it to fail when I’m three states away driving for a conference like this. So a lot of a lot of technicians need to understand that because they have a fix it mentality that they can’t. They can fix it. But the customer doesn’t want it.

Everett Lippel: You’re there to tell that takes continuous training. I mean, it is a constant you’re constantly having to drill in. It’s funny we got Blake over here. It’s taking pictures. He was one of the service technicians at a company that I work for and we had. This was a continuous thing where it’s like you have to almost you have to just change the mindset of the of the technician, you know, the technician mentality like guys, it is not wrong to make suggestions in the house and communicate things. Ok, so you know, at the end of the day, you’re serving. Yeah. And if you’re you’re serving, you’re serving that customer, you’re serving them, you know, the ability to understand what’s new [00:34:00] and inventive and maybe some preventative things they can do in the industry and to their house and for their comfort, right? And you would never do anything that you wouldn’t do in your mom’s home or your grandma’s home. But but that mentality has to change, and I think that guys like you, you’re you’re probably constantly drilling that and enjoying it. It takes it’s that habitual discipline to understand and break the mindset. Once the mindset changes, then you can move on and say, Hey, OK, it clicks and you see a tech. And he’s like, I made the suggestion, I made the recommendation and they went for it, and they’re so

Tersh Blissett: Happy and I got a five star review. Understand this? Yeah, right? Yeah, I agree a hundred percent there.

Chris Folmar: And then isn’t it great, though, when you have technology now that can help them through that process? Because when they go out for that maintenance call, guess what? All the things Billy’s talked about managing the membership program we’ve baked into the product. Mm-hmm. All those things about being able to like, ask the right questions at the right time we’ve baked into that tech app. So why text love the app that we’ve got out there? Because it makes their job easier. Their close rates are higher. They follow the prompts, they follow the prompts [00:35:00] and then they see the success. They can do it in their own style, but they follow the prompts. They see the success because the prompts give you consistency. Yeah, consistency gives you results that you can replicate.

Tersh Blissett: How about this? Does it work for light commercial? Also, because there are certain things, even in my forms where it’s like presenting six options on a commercial job just doesn’t make sense all the time, and so can we can work in commercial also.

Billy Stevens: We don’t even mess with commercial. I mean, but I would suggest that you go with a service agreement when you’re doing commercial. Yeah, absolutely. This is a different animal, right? A whole different, totally different animal. We’ll do like commercial for a customer that we have, you know, that’s what we focus on the residential 100 percent and I highly recommend we all do because we start messing around with like commercial or we’re messing around with air. Yes, that’s right exactly where I was going. And you know, I practice what I preach to all these guys. You know, we can’t have a dollar. They are not even a dollar. Yes, this is not going to happen. And, you know, even [00:36:00] if commercial account. wants to do business with us, somebody is going to give us a credit card.

Tersh Blissett: Yeah, absolutely.

Billy Stevens: And we’re going to keep it on file. I mean, you know, legally, the banks keep it on file. We’ll keep the last four digits. But. And so that’s the thing is, how do we get out of air? You know, when I first got into this business, I paid for a new construction company. It didn’t do service. I bought a new construction company.

Tersh Blissett: Yeah, that’s tough there, right?

Billy Stevens: And that’s what I bought. And it wasn’t a service company. It was one service van and it was an English fella that was

Tersh Blissett: There advantage to doing that because you had a large client base. And then also you can serve them or

Billy Stevens: I just wanted to buy it. I didn’t know due diligence.

Tersh Blissett: I didn’t pay back. Sometimes you just got some cash burning in a hole in your pocket. Oh, hang on. I had zero cash. Oh, well, that’s okay. Zero cash.

Billy Stevens: But I hated working for the man and I had to get this. My wife made me get a real job, right?

Tersh Blissett: Yeah, I was doing

Billy Stevens: Good back in their 90s, where I was making about 40. She was making about 40, you know, and we were living the dream. And this company [00:37:00] just kind of fell into my lap and I went to her father and I said, Could you borrow me $10000 so I could get this deal? And he goes, Sure, you know, I’ll do it. And I found out later that he gave all of his daughters 10 grand.

Tersh Blissett: Oh, he didn’t really do me a favor.

Billy Stevens: Yeah, he didn’t mention that until later.

Tersh Blissett: Yeah, and he goes, But he goes, You’re the

Billy Stevens: Only one that’s ever paid me back.

Tersh Blissett: So that’s good. Yeah, that’s that’s funny. That’s hilarious.

Billy Stevens: So we didn’t even know. We didn’t even know what due diligence was. It was. It was a one point two million dollar new construction company, and they’ll only pass away and the wife was just having a hard time. Mm hmm. And, you know, she wanted $800000 for it. The first time I talked to her and I said, Well, I don’t even I don’t even know how to how many zeros that is.

Tersh Blissett: Yeah, yeah.

Billy Stevens: And about two weeks later, she calls me back. She goes, What could you afford to pay? And I said, Two hundred thousand. Yeah, right? And we ended up buying it for two, twenty five. And I go to the bank and I got the $10000 in the new [00:38:00] account. I think we had about a thousand dollars in our checking account. And I go, I go to the bank and I sit in the office there with the banker and he goes, Where’s your father in law?

Tersh Blissett: You know cosign it. Yeah, my he at work

Billy Stevens: And

Tersh Blissett: I got another question for you there, pop. Yeah.

Billy Stevens: So I had to go out to the truck and

Tersh Blissett: Make a phone call. Yeah.

Billy Stevens: And it was a scary phone call, and I said, Can I come to your office? I didn’t do it over the phone.

Tersh Blissett: Oh, wow. Yeah, that’s cool.

Billy Stevens: And I went to his office and explained it to him and he said, All right, I’ll do it. And he did it, and we paid him his $10000 back in three weeks with five hundred dollars interest. Oh wow. And we bought his meal for the first time at a real fancy restaurant. It just opened up in grapevines, called out Outback Steakhouse.

Tersh Blissett: Oh yeah, that’s fancy. Now it was back then. Yeah, heck yeah.

Billy Stevens: And anyway, long story short, you know, we, you know, we paid off that loan in one year and we

Tersh Blissett: Did that with new construction.

Billy Stevens: Well, [00:39:00] I was I was at home. I was working for a homebuilder and I knew that the the surge of home building was coming because we started selling houses. So I just started raising the prices because they couldn’t find plumbers, because I found a company, I couldn’t find a plumber to do our work. That’s how that’s how it all happened. So I already knew and my wife, you know, the one thing you know, I asked my wife, You know, I want to buy this company and I really want to do it. I’m going to quit my job. And you know, she was very supportive and she goes, Yeah, I don’t mind if you do that and I go, But there’s a catch. And she goes, What? You got to quit your job, too?

Tersh Blissett: Oh, so she could help you? Yeah.

Billy Stevens: Yeah, help me. She’s smarter than I was. She needed her.

Tersh Blissett: That’s hilarious.

Billy Stevens: And so we we quit both for our jobs and walk.

Tersh Blissett: That’s not scary at all. No, that’s not scary at all.

Billy Stevens: I don’t know what made it even worse as we walk in there and we start talking about, you know, how we’re going to, you know, become a really good plumbing company and do all this stuff. And as I’m saying this, about half the company walked out.

Tersh Blissett: Yeah. Oh no. Yeah, no kidding.

Billy Stevens: Oh my God, that ran [00:40:00] the commercial division called all this. You know, all of his trade or the guys

Tersh Blissett: That he took. All the clients took all the clients.

Billy Stevens: Oh man. And you know what? I never batted an eye. I said, OK, well, that’s less for me to deal with.

Tersh Blissett: Yeah, that’s one way to look at it.

Billy Stevens: That’s just basically what went through my mind. Ok.

Tersh Blissett: That’s not the first thought came to my mind. I was thinking shotguns and stuff. But yeah,

Billy Stevens: Well, and then we got even more bad news. Every single person there had had a rap sheet.

Tersh Blissett: Oh, wow. The people that laugh. So going in their houses and stuff. Well, let’s look at that new construction.

Billy Stevens: So it was like, yeah, it was pretty rough, and I figured that out the first day.

Tersh Blissett: You can’t change to a service company. Right?

Billy Stevens: We weren’t even thinking service company. We didn’t know yet. You know, we we just didn’t know. And what made me think of it is we had this one guy in one truck and he would run service calls and he brought money back every day.

Tersh Blissett: This guy is making us money, so let’s let’s

Billy Stevens: Do what he’s doing, and I had to hire someone to get my money from the builders.

Tersh Blissett: So [00:41:00] right, let me let me dove into this a little bit because I have a really good friend of mine, John, and we had this conversation constantly about service departments making money for the company versus install departments. So we are very service driven, but we have a challenge with flipping leads and getting the system. Sold. But our service department covers the overhead of the entire company with no problem at all. And then his company is the exact opposite there. Their service department, it’s going to cost them a million dollars or something and or $100000, whatever. But they’re flipping leads and they’re making gangbusters on the system replacements. Which which way is better for you. Like, do you do you cover the overhead with the service partner because you got a quick cash there? But then at the same time, you have system replacements, which I’m going to ask this earlier. We’re running really, really late, but it’s so interesting information. Financing is their financing built [00:42:00] into or integration or some sort of in there?

Billy Stevens: Yeah. So we just got a deal that we’re working on and we’re going to finalize it here next week that that’ll integrate with our system. Okay.

Tersh Blissett: Yeah. So we got financing there. So you don’t get the answer.

Billy Stevens: May not be here today.

Tersh Blissett: Ok. Ok. All right. Cool. I might have him on the show a little bit, but so we we get the cash quick from a system replacement. So obviously you’re or is your margins going to be the same across the board because you’ve inputted it or

Billy Stevens: Ok now the margins are higher on the repair

Tersh Blissett: On the repair is going to be higher. Yes, that’s exactly how ours is is set up in our business. Oh, absolutely. But but theoretically, I feel like there’s a challenge there with not replacing systems. Well. I don’t know. I mean, you see a big ticket item, so here’s what I see like, so I have a margin

Billy Stevens: On a repair. Think about it like this. If I have a higher margin on a repair, [00:43:00] I’m not that far from a new system, right?

Tersh Blissett: If I add. Well, that makes sense.

Billy Stevens: Yeah, yeah, right. If I put add ons in there, I can get the price of a repair to a point where it only makes sense to buy a new system. Yeah. Right. And that’s how you do it. You get the higher margin on the end. If you just get the repair, the margin, the margins, the margins there. Yeah, it’s a win win. But the thing is, is one of the things when I got into the AC business, I couldn’t believe how many people changed down to compressors.

Tersh Blissett: Oh yeah, right? Three thousand compressor

Billy Stevens: Change, either. I didn’t whatever. I didn’t understand, you know, all that work that went into that because I knew nothing about air conditioning at that time when we put it together. So I had a meeting with my folks. I said, We’re not going to change another compressor if you’re going to sell a condenser because we’re going to raise the price of the compressor to the point where it only makes sense to buy a condenser.

Tersh Blissett: Well, I did that with R twenty two and it kind of backfired on me like It’s me a thousand dollars a pound for that crazy.

Billy Stevens: But yeah, I mean, we went through a couple of those things. I remember when we the Obama [00:44:00] was elected president and he raised the minimum standard. I think it was to twelve seer. Mm hmm. And we had a bunch of 10s here, stuff out there and everybody was like, mad, it’s going to cost more. We’re not going to be able to sell them and making all those, and I just look at it in a different way. I just went and bought three 18 wheelers at 10 Sears before they stopped making them.

Tersh Blissett: Well, that’s one way to do it right.

Billy Stevens: And then I bought the freon. I bought pallets and pallets of it right because I had the money to do it because I knew my margins already and I started

Tersh Blissett: Going back to the

Billy Stevens: Numbers, right? And so we rented a warehouse just to fill up all of these condensers and all this freon that we had saved, you know, in Boston. Cool. Yeah, and and then all of a sudden we were. So we were super competitive, right? Yeah. And we started getting calls for from apartments about two years after the

Tersh Blissett: Bombing or twenty two.

Billy Stevens: Yeah, right. They had to buy it from us. So that’s why we we ended up kind of being the supplier in a way, probably 40 percent of it. We sold to someone else and then the rest of it we installed because you could still install, you just manufacture it anymore.

Tersh Blissett: How much [00:45:00] of it walked away and shrinkage?

Billy Stevens: Oh, on the 10 stuff,

Tersh Blissett: Just your stockpile of stuff in the warehouse.

Billy Stevens: None. My brother lived in that world.

Tersh Blissett: Ok, yeah, I’m not kidding. That’s the challenge. I’ve seen that personally where you’re like, All right, we’re going to buy a pallet of four, 10 a whenever it was shooting up through the roof. And then all of a sudden it’s like, man, we didn’t use a powder refrigerant last year, the whole year. And now, like the pallets gone like it was like, Hmm, I wonder where all that stuff went. You know it’s up. But yeah, yeah. Anyways, we could man, we could talk for hours here. And honestly, I thank you so much, all of you. You know, Chris, Everton and Billy, thanks for having me. Yeah, absolutely. Thanks, man. Yeah. And if there’s anybody has any questions at any you know about, Oh, actually, you know what, Josh Crouch? Hey, Josh, he’s here. What’s up, Josh? And he did ask this a long time ago, and I meant to ask, but I  got distracted. And but It’s, can [00:46:00] you customize the inputs if your market has systems that run their lifespans quicker or your business model wants to send sales text to a ten-year-old system or twenty-year-old systems if that’s normal in your market? Or is it one size fits all?

Billy Stevens: No, you can customize it to send anybody you want to call.

Tersh Blissett: Ok, yeah. Ok, cool. So, Josh, that was a really long question, and the answer is no, you’re good. You can customize

Billy Stevens: It. You can customize it however you want.

Tersh Blissett: Cool. Thanks. Now, if anybody wants to learn more, I have a coronae across the bottom of the screen, but it’s Sarah Dot tech and it’s a dot. Tech is where we go, right?

Chris Folmar: That’s right. But let’s do this here, Billy, since you’re listening, here we do this podcast here at the show. Let’s drop our show special QR code in the comments. Ok, and they scan that, then take come to a page [00:47:00] that’s just for the attendees here, where Billy’s about to make the probably the best offer we’re ever going to have.

Tersh Blissett: Oh, that’s what’s up. That’s what’s I

Chris Folmar: Say. And they want to learn a little bit more about it. So we’ve got some coming up upcoming webinars on the 12th and the 19th of November, that one QR code they can see that they can sign up if they’re ready to go, they could sign up for one of those webinars because right now I can tell you, Billy Billy never mean their calendars are getting full. Yeah, I mean, it’s something. So if I can get people who want to come to that, they’ll learn everything they want to know about it there. And then again, they also have an option since they’re coming to us from you here at Service Emperor Academy, coming from you, they’ll they’ll have a chance to to get on the deal.

Tersh Blissett: I appreciate that, man.

Chris Folmar: Yeah. So I’ll drop that code to you. You can put that in the comments. They can follow on that.

Everett Lippel: And I was going to say, if anybody wants like special attention, has questions you know, wants to get walked through, wants a demo. They can hit me up on wherever Facebook I email, phone, tech, smoke signal however they want.

Tersh Blissett: I Cool Deal Cool Deal. Man, you got something else to add.

Billy Stevens: No, [00:48:00] I think we’re good. We could go on and on, so we better stop here.

Tersh Blissett: Yeah, I appreciate everybody that’s listening to or watching this episode of the Service Business Mastery Podcast It’s It’s. I am naturally inquisitive. You can tell by just the questions I ask. But this product is it’s definitely a disruption in the industry. And I think that while I know that you better get on it right now because this offer that they’re getting ready to give out and present, it’s not going to be sticking around. But with that being said, do you have any questions at all? Don’t hesitate to reach out to any of us here, and I will put all of our information in the show notes. But thank you again for watching this episode of the Service Business Mastery Podcast Its podcast focused on serving business owners, managers, and technicians who are considering becoming business owners themselves. Our target here is to help answer some unasked questions, and I hope that that’s what we did in today’s show. But until we talk again, next time, I have a wonderful and safe day. See you!

Announcer: Thank you for listening to this episode of the Service Business Mastery Podcast. [00:49:00] Now that you are equipped with essential business advice from this impactful conversation, you are one step closer to becoming the successful owner of your dreams. If this episode has been helpful to your business journey, don’t forget to subscribe to the show, leave a rating and share it with other owners as well. Visit Service Business Mastery Podcast to learn more.