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In this episode of Owned and Operated, John explains the world of home service business growth with CEO Peter Lohmann, focusing on how branding can serve as a powerful lead-generation tool. John and Peter explore the journey of scaling a home service company, including the challenges, insights, and opportunities that come with driving marketing efforts and building operational efficiency.Key takeaways from this episode include the critical role that marketing and branding play in generating leads, the importance of optimizing call centers, and how to scale operations efficiently. John also emphasizes the value of finding the right people to solve specific problems in the business, which can unlock massive growth potential.
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Episode Hosts: 🎤
John Wilson: @WilsonCompanies on X
Jack Carr: @TheHVACJack on X
Special Thanks to Avoca AI Coaching and Training - Looking to train your call center and technicians back on their calls? Get better performance today with the power of Avoca AI, as your staff learns their pain points and improves end-to-end. We have a special promo code available if you schedule now: ‘OWNED’.
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Episode Guest:
Peter Lohmann: @pslohmann on X
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Peter’s RL property management: https://rlpmg.com
John Wilson, CEO of Wilson Companies
Owned and Operated Episode 146 Transcript
John Wilson: I just really get excited about these like 1 percent improvements.
Peter Lohmann: You and I are very aligned in a lot of sort of our philosophy around growing businesses.
John Wilson: It is just so easy to overcomplicate. Like scaling a business is removing constraints.
Peter Lohmann: Maturing as a leader, as a CEO, is recognizing those who, not how problems.
John Wilson: A few months ago, we got our call center on Avoca. And Avoca is a AI call center solution for business. for home service companies just like me and probably just like you. They have a couple different products, but the one that we like the most is their coach product which listens to every single phone call and runs it through a rubric to help our call takers improve.
John Wilson: And this is a really big deal because we take hundreds, sometimes thousands, of phone calls every single day and it's just too much for our trainers and managers and leads to keep up with and effectively train. So it lets us do ride alongs on almost every single call. Click on the link below to go to Avoca and make sure you use the promo code OWNED for a special discount.
Peter Lohmann: John, you own home services business, HVAC, plumbing, some other stuff, I believe. And here's what you said. So far this year, you've spent 1. 6 million on advertising. Oh, so that's the last 12 months, 22, 850 homes visited in the last 12 months, 6, 100 HVAC systems serviced, 3, 103 drains cleaned, and 190, 000 phone calls.
Peter Lohmann: Yeah. So that's the scale that Wilson is operating at. So just to paint a picture and if you wouldn't mind giving a few minute background, you don't have to run us through the whole story but just bring us up to speed. What are you up to today? And in summary, how did you get there?
John Wilson: Yeah it'll, I'll keep it brief, but in 2016 we bought my family's Plumbing and heating company, and it was eight people and a million dollars. I think even in that tweet we had a picture of the first we, the meeting that we went through those numbers. It's called the State of the Wilson.
John Wilson: So this was our ninth state of the Wilson.
Peter Lohmann: Yep.
John Wilson: And I think my wife, I think my wife came up with that name a decade ago. ?
Peter Lohmann: State of the Wilson.
John Wilson: State of the Wilson. Yep. So in that tweet, there was also a picture of the very first one, which there was like six people in the room. So that was the business then now obviously much larger scale.
John Wilson: So we'll land at the mid to high 20 millions this year, 135, 140 team members and a market leader, which, I could have never said even just two or three years ago. So a lot's changed over the past few years. And we're, we've really anchored ourselves around this hundred million by 2030 target.
John Wilson: And we're aiming at that pretty hard which has been like fun and exciting. That's, I, that wasn't even something I would have thought was possible. I had hoped for it. But now, in the past eight years, we've 25 times. So all I'm looking to do now is do a four times. So it's way easier.
John Wilson: That's how, that's at least how I think about it. So it is fun. Obviously we've gone through like a tremendous journey and I'm tired most days, but we still really feel like we're very early. In a lot of our journey, like there's, we're still actively figuring stuff out that we probably should have had figured out a while ago.
John Wilson: And I think that's, I think that's exciting when we solve these duh, problems and. We're solving them at the scale that we are and it's like that now those the impacts of those decisions is measured in millions.
Peter Lohmann: So you're obviously in plumbing and that was the origin story.
Peter Lohmann: Sounds like you're in HVAC, sounds like you're in drain cleaning, which maybe you think of that separately from plumbing. And then any other businesses are you doing any kind of sewer? I feel, I don't know. You've been in and out of a few things. I just want to get a picture of that.
John Wilson: Yeah. Yeah. Plumbing HVAC electrical and then plumbing consists of underground plumbing, which is drains and above ground plumbing, which is water heaters, faucets, toilets different skill sets, different sales processes, different leads different technicians.
John Wilson: And So we're in those, we consider those different trades, like they have different leadership and everything. And and then we also have water restoration. So we go, it's CERB pro. So water damage, we find that a lot as plumbers. It's a small part of the business, but it is one of our trades.
Peter Lohmann: And are you, do you do jobs big enough there where you're court, you're billing insurance companies?
John Wilson: Oh yeah. Yeah. That it's a very different business to our core business but it'll do about a million and a half this year, which is cool. It's almost entirely fed off of our like in house, our plumbers walk into a home and it's a, basically an added service.
John Wilson: Hey, you're here. We're here because you had water damage. Do you want. out and help you clean it up. We launched that back in 2020. It's been slow moving, but it's, getting some legs.
Peter Lohmann: So do you have to use that like special software that the insurance companies want you to use? Yeah,
John Wilson: Xactimate.
Peter Lohmann: Xactimate. That's what it is. Yep. And what is that about? Cause I remember we've dealt with this kind of tangentially just through the property management. I'm sure. Yeah. Yeah, I had a claim that I dealt with one time, and I just remember looking at the software and a couple things jumped out to me. One, it looked super complicated and hard to use.
Peter Lohmann: Super complicated, yep. And the other thing is that the pricing was super high,
John Wilson: like really high. Xactimate is basically the software for what insurance will pay. For whatever the damage on the home is. So that's basically the agreed upon price. It is very complicated. I have no idea how many SKUs are in there or line items of price.
John Wilson: I'm sure it's in the tens of thousands. It's ridiculous. So you have to hire exactimate consultants or you, if you. The, shops that are large enough which we're not, it's a six person team. They'll have an in house Xactimate consultant because the water mitt is there's a labor component because there's a, there's an incident, right?
John Wilson: So we just had really heavy flooding, maybe a month ago, two weeks ago. I have a foot of water in my basement. So water mitt is, I'm going to pump that water out. I'm going to remove the damaged contents, which is Furniture, boxes of storage, whatever. I'm going to remove the damaged property.
John Wilson: So that could be what's called a flood cut. They'll remove 18 inches of drywall. So mold doesn't grow up the walls and they'll remove carpet sometimes some wood, depending on how, what the state of the wood is. So there's a labor component and then there's also an equipment rental component, which it takes days to dry that out.
John Wilson: Concrete is really porous. So it's like a sponge. so you know you have a foot of water and that concrete is going to get really spongy. So you put in dehumidifiers and fans and air movers and all this stuff to basically dry the heck out of the basement. The way that business works is, There's a labor component.
John Wilson: So you get paid for that. And then you also essentially rent the equipment to the insurance company by the by the day.
Peter Lohmann: Yeah. We do this for our clients too, actually, when we have a minor water incident, we have blowers and dryers and dehumidifiers that we rent to our clients.
John Wilson: Yeah. That makes sense.
John Wilson: That's a good idea. But yeah. So then the way it's priced is exactament and The billing side is really interesting because it's just like a totally different game than like our core business where you'll send an invoice to whoever the insurance provider is and then they'll just like, and then negotiation begins.
John Wilson: So you really, you don't actually know what you're going to get paid. You don't even know the value of the job until two weeks after you finish it, a month after you finish it. You'll go in and you'll be like, I think this is a 10, 000 loss. And just based off how much of equipment and, the rough labor, but most of its equipment, like 80 percent is equipment rental.
John Wilson: So then you submit the invoice to insurance or through your cashier. Consultant for Xactimate, they haggle. So it's literally just negotiations. Oh, we don't like this line item, but you coded it this
Peter Lohmann: way that really should have been coded to this cheaper option. Yeah. It's like health insurance billing or something.
Peter Lohmann: It
John Wilson: really is. It's it's so weird. It's so weird to us. Like we're used to it now, but the first like year I was like, what do you mean they're, they just are going to pay half. What are you talking about? But yeah, so exactly. It's complicated, but yeah, that's the restoration business. It's a small business for us.
John Wilson: And it's basically just grown with the company.
Peter Lohmann: All right. And then do you have a septic too?
John Wilson: Yeah. So septic is a part of underground plumbing.
Peter Lohmann: Okay.
John Wilson: All
Peter Lohmann: Cool.
John Wilson: Yeah. So we'll pump septics replace them, replace drains, do pipelining. That's a fun new service addition that we just did.
Peter Lohmann: Okay.
Peter Lohmann: Awesome. And then do you have like a GM of each of these trade lines or like, how is it organized?
John Wilson: Yeah. Work structure is complicated. It's simpler now. So we used to, these used, we bought a bunch of these And then last year we combined them, which has been awesome. And so now it looks just like a, it looks like a normal pyramid org structure.
John Wilson: Now there are decisions that we're making right now, which have been really helpful. So when an organ, when an organization gets bigger and bigger, we're basically going through a reorg. And I think it's going to continue to happen. We've done a few of these over the years, but this most recent one is like, how do we reduce friction and increase focus to the tune of 135 people?
John Wilson: And like, how do we do that in verticals? So it looks, yeah, it's just a pyramid org structure now. And the way it used to work was each trade had an ops manager that would handle that trade. And then underneath that ops manager, they would have. So that would be a service manager, an install manager, a dispatcher, and each one was dedicated to that specific trade and those team members and those customers.
John Wilson: And some of the pain points that we experienced there were like friction. Hey, if I'm working with electric as a customer, if I'm working with electric and I have to bring in HVAC or if I have to bring in plumbing for that same project, a generator would be a good example where like electrics on it and plumbing has to do the gas.
John Wilson: It feels like I'm working with two different companies.
Peter Lohmann: Okay.
John Wilson: Because the way the structure was laid out. So we had that structure because we bought these businesses and they each came with sort of their own respective leaders. And then over the past couple of months, we've been unpacking that and separating them now into specialty.
John Wilson: Hey, if your service or sales, this is your vertical, you're going to report to this director. If you're install, you're going to report to this director. And then the frontline managers are still by trade.
Peter Lohmann: So the analogy in property management is, We call it like departmental where everything is very individualized versus a portfolio style where You'll have a property manager who's responsible for say 10 percent of your whole portfolio, but they do everything for those 10 for that 10%.
John Wilson: I think what we, so there was a couple of pain points and like organization design is a, it's a fascinating and like ever changing. Because you'll, you build out these teams or like role or, whatever. And so you build out this role or multiple roles inside a company. And then where it starts could be totally different from where it lands.
John Wilson: And for any number of reasons, like it could be to reduce friction, it could be to like maximize impact. We have a team called SDR. And they have, they're now moving and, this sounds chaotic, but they've been really great, but they're now moving to their third vertical that they're sliding over to because each and each one has been a tremendous impact because each time we move them to the next vertical whatever friction they had is, reduced or they're able to, dive deeper into some process or the results are bigger.
John Wilson: So it started off in marketing because it was tied to leads and then we tied it into call center and now we're sliding it over to our basically our external leads team.
Peter Lohmann: I've been spending a lot of time recently thinking about role design and the accountability chart. Concept from EOS and both how to optimize our existing structure and then also thinking about and planning for future growth and what are the new roles, what roles are combined, what roles are getting separated out and, It's challenging.
Peter Lohmann: And I know you've talked about not over indexing on process too soon. Because it's inevitably going to change as the company grows. I've always appreciated your perspective on that because it's like the yin to my yang because I'm like a super process and systems guy. You and I would cut
John Wilson: heads a lot.
Peter Lohmann: How are you thinking about that these days? Are there any parts of your business where you're like, okay, this is going to be the same or it's going to be copy paste as we scale. So let's get the process right. Or do you still just do the bare minimum process with the assumption that, Hey, this is going to change next year anyway.
Peter Lohmann: So let's not overdo it.
John Wilson: I would say it probably depends on team. I'm a. Maximizer. I like to, I just really get excited about these like 1 percent improvements. Continuing to make 1 percent improvements. And if you look at
Peter Lohmann: stuff too,
John Wilson: if you look at like the history of my career, like you can point.
John Wilson: Out decisions that was like, that was a 1 percent improvement. And sometimes it ends up being far more than 1%, but I like that stable step by step increase. So some teams you don't really want to mess with. And I don't think it depends on where you're at and like you're, in your growth story, but I tend to not want to go in and blow things up.
John Wilson: Unless the team is really needs to be blown up. Lot of our work over the past year or so for most of the teams has been driving process and consistency across them, depending on the team and the way we're thinking about it which I, in some ways is right. And in some ways is wrong. Once we get, let's say two or three of the same person, like that role really needs to be dialed in.
John Wilson: I personally find it challenging to drive a ton of process through one person, just because there's no, it's a single point of failure. So it's It will fail, like wherever there's a single point of failure, it will fail. But once that becomes a team, that's when process starts to become a lot more.
John Wilson: There are teams now that like accounting would be a great example. Accounting is five people and not a significant amount is going to change between accounting, mid 20 millions to accounting at. Forty something million. Yeah, more people, more transactions. And honestly, maybe
Peter Lohmann: more AR, but more of the same.
John Wilson: Yeah, pretty much. And even more people, like not that many more, right? Like we could probably do double the volume and add a person in accounting. So accounting is really going through a process. Year as we try to drive down what does this really look like? And how do we function every day to, to have, perfect payroll, perfect books.
John Wilson: So I think a lot of it's company growth, and I think it's also department growth, because if the department is going through, let's say a department is tripling in a year. And we, I tend to think about it by department and because I think that's easier. Because there's some part of your organization that is probably really stable, 90 percent of your organization is probably process driven.
John Wilson: Otherwise, you wouldn't have gotten anywhere meaningful. But maybe marketing just went from 1 to 3 people, let team just triple. And now you need a lot more structure around that team in order for them to do their job successfully. And that's our story with accounting right now to where, okay, we just grew it a bunch, took it from 2 or 3 people to 5.
John Wilson: What does that look like? What does proper execution look like? How do we scorecard it? How do we, have looms to the knees? Yeah. In notion. Yeah. And notion. See, we we're really excited because slack just dropped a, like a notion like feature. Oh, cause we've used notion for years, but what I've always, I'm, I don't know why I think just like simplicity is great.
John Wilson: And I think it's really hard. Every, every little thing you add adds a new layer of something.
Peter Lohmann: Couldn't agree more. Yep.
John Wilson: Yeah. And when you go to the easiest way to manifest for us is, How many apps are on my technician's iPads? Correct. That's it. How many apps? Because that's us telling our team members how complicated we want your life to be.
Peter Lohmann: Right.
John Wilson: And,
Peter Lohmann: Yeah, if there's ever an opportunity to reduce that number by one, even if you're giving up a little bit of functionality, that's usually the right decision in my experience. Yeah.
John Wilson: A hundred percent. Yeah. And I think we've always fought hard because it is just so easy to overcomplicate.
John Wilson: It is it's unfortunately the easiest thing in the world and everybody wants to do it. So you can't see how to fight it, but slack just came out with something that we're, that's going to allow us to drop notion. So we're really excited about that because it's basically we always wanted slack to just be like our intro web basically, where you could log in and there's the homepage and here's the newsletter and here's the like links to whatever.
John Wilson: And they finally dropped that feature. So we're excited. We're saying by notion.
Peter Lohmann: Yeah. I'll be curious to follow along with that. Yeah, I think it's
John Wilson: pages like Slack pages is, I think what it's called.
Peter Lohmann: We're Heavy Notion and Slack users here, so I'll follow that with interest. Now are you guys still running on EOS or have you outgrown that?
John Wilson: We're still running on E os. I think we're still running on EOS. I think EOS is a good. This comes up, I don't know why, but I'm going to, I'm going to I don't know why it comes up, but I'm in a few of these like CEO text groups in industry, not an industry. And EOS comes up like once every six months and yeah, I'm just like, I really don't, I really don't know why.
John Wilson: So like we've been on EOS since 2021 and my answer is always the same. Look, yeah, it it's a good thing. It helped us. EOS is a way that you communicate. It's a way that you roughly hold accountable and it's a way that you. Have meetings and share vision and those are really good things like they are.
John Wilson: But sometimes I think people are too like prophetic about it where They'll just ah, it solves all your problems. And I'm like, no, it literally doesn't like it teaches you how to talk to each other
Peter Lohmann: Yeah, it doesn't have anything to say about strategy. It has very little say to say about marketing.
Peter Lohmann: There's almost nothing about sales
John Wilson: Yeah, so all that to say I don't think you outgrow You learning how to talk to each other.
Peter Lohmann: I've heard some folks who are getting up to around your size or at least one CEO I'm familiar with and respect a lot. He moved from EOS to scaling up.
John Wilson: Yeah. That most people move around this size.
John Wilson: We haven't, it hasn't been a priority for us. I think
Peter Lohmann: don't fix it
John Wilson: basically. I do think like some of the friction that you have later on is Hey, if you're running like 18 L tens a week. You got a lot. There's a lot going on there. And is that juice worth the squeeze? Are you getting the real impact out of the commitment of wages and time and lost productivity from 18 L10s a week?
John Wilson: You'd never hear me say that about L10s, but like 18, I'm like, okay. We might have lost the plot here.
Peter Lohmann: All right. So I want to, I admire your operational chops and I love your approach to 1 percent improvements. You and I are very aligned in a lot of sort of our philosophy around growing businesses.
Peter Lohmann: I love to dive in for a minute to talk about the phones. Now the metric you gave 190, 000. thousand phone calls in the last 12 months. Yeah. And dude, that's
John Wilson: literally just phone calls,
Peter Lohmann: right? That's
John Wilson: not inbounds. That's not messages like it. We would clip half a million.
Peter Lohmann: Yeah. Insane. So
John Wilson: it's amazing. So we deal with what effect if that's probably tripled the trip, the 12 months before that.
Peter Lohmann: And. Phones are slowly dying, right? People are moving away from phone calls, but they're still a huge part of business. And as, as property managers, we have incoming calls from our residents. We have incoming calls from our property owners and we have incoming calls from our vendors. All of them need to be dealt with and handled quickly and appropriately.
Peter Lohmann: But I know that you guys have taken this way to the next level because phone, I'm guessing that a lot of your new business comes from phone calls. And it's the type of thing where if they call, it goes to voicemail or it rings for a minute or two, they hang up and they call the next guy in the phone books, so to speak.
Peter Lohmann: Yeah. And I remember being in awe of hearing you describe, like you, you went into this department and a picture, you're just like tearing into everything. And you're like, this, we got to get this down to seven seconds or less. Or I remember hearing you talk a little bit about this one time. I don't remember if it was like an in person conversation, but it's all,
John Wilson: So far this is all real.
John Wilson: Yeah. So what did
Peter Lohmann: you, when did this first get on your
John Wilson: radar and why? I'll start off with. We don't feel like we have this fully figured out, which to me is exciting because I've put an insane amount of work into it. And if I haven't fully figured, and I'm like, I'm relatively intelligent, I'm an average intelligence, maybe slightly above, right?
John Wilson: And we're big. So if we aren't fully dialed on this, then the people that we competed with are on like, they're not even on the ball field.
Peter Lohmann: Yep.
John Wilson: So we find that very exciting. It's like ringing the
Peter Lohmann: owner's cell phone still.
John Wilson: Yeah. Yeah. Yeah. Yeah. So we're, we think we're at like a step four out of 10.
John Wilson: We don't think we're best in class. We do think we are leagues ahead of where we were, but we still think that we have a long way to go, but yeah, tons of stuff through phone calls and obviously that it is complicated. It is. There's a lot, there's a lot to unpack there. The volume came from us getting better at marketing.
John Wilson: We, you invest all this money in marketing, 1. 6 million, in trailing 12 months marketing, and for whatever reason, our industry is still driven by phone calls. In some ways, I wish it was by text, that would be easier in some ways but the technology isn't even totally there yet because the industry is driven by phone calls.
John Wilson: Not me, the industry. Totally.
Peter Lohmann: And there's something about as if I put on my sort of customer hat for a minute, I'm at home, the kids, it's dinner time, right? Suddenly, water's pouring out from under my sink. Or suddenly, I notice the furnace hasn't run all day and I look at the thermostat and it's 60 degrees in the house and it's gonna be below zero tonight.
Peter Lohmann: I am reaching for my phone. And not to text. I'm reaching for my phone and I'm like, I need to call somebody. There's something very primal in that moment of emergency home service where you're like, I need to get on the phone.
John Wilson: Yeah. What people think it's a speed and you said, I think you said this.
John Wilson: I'm going to, I'm going to quote you. This is great. Just quoting each other all day. This was years ago. You know how impactful it was. Cause I really, this rolls around rent free in my head, but it's, if it's not important, not urgent, you send an email. If it's and it was like email text phone call
Peter Lohmann: It's actually our communication style that we recommend for our team.
Peter Lohmann: Yeah,
John Wilson: we had a couple major pain points earlier this year and those pain points were how do we contact our unsold estimates more frequently? How do we book our membership appointments faster? How do we stay in contact with customers and let them know that we have promotions and how do we run a special?
John Wilson: Speed to lead process for Angie's leads. When looking around for solutions, we saw a couple great softwares on the market, but our favorite one was Hatch. So when we started using Hatch, we had just switched over from another vendor and Hatch's user interface was so easy. It directly tied into Service Titan.
John Wilson: It automated the workflow of five or six employees a day. We're now in contact with hundreds of additional customers. We're selling AT& T.
John Wilson: I think about that all the time honestly, twice a week, and that was like three or four years ago but I think it's the same thing someone is they want to know. Like their home was just threatened. It was infiltrated by water. They don't have power there. They're feeling insecure because it's zero degrees tonight and I don't have heat.
John Wilson: Like they need to know that they're taken care of that, that I'm good to go. And a text is not very satisfying because there's a two to three minute wait. There's some back and forth bullshit. And 30 minutes later, you finally have an appointment booked like that works if you're like trying to estimate something, but if you have water coming through somewhere, like you want to know that your family's taken care of.
John Wilson: And a phone call, you'll, it'll be done in 60 seconds. Like you'll know, Oh, okay. They picked up. I'm good to go. So I think it's definitely a component of that. And I think it's also just how leads are driven. So the leads are driven via phone call because that's what Angie's list pushes. That's what Google pushes.
John Wilson: It's what they all push. So as much as I would wish it would change just because our, like our contact per CSR would be higher and our, but wish it would change, but it's still pretty driven by phone call.
Peter Lohmann: There's really something there. It's I'm picturing, there's a problem with the house.
Peter Lohmann: My wife tells me about it. And then five minutes later, she goes, Hey, did you what's going on with that? And I'm like I texted somebody. It's not the same as yeah, I called them. We got an appointment set. I
John Wilson: texted them. They didn't text me back yet. I thought you were handling this. Yeah, it's a good visual.
John Wilson: It's good. So yeah, we've been pushing texting for years and it works. We obviously, I don't even know thousands of texts a day with our customers. But our like our customer activation, the vast majority is still phone call, but what you can optimize just the hell out of that, which I think has been a lot of fun.
John Wilson: Hey, how do you like a project that we're working on right now, which I think is I think is interesting. Yeah. Is we interviewed a friend of mine and he runs this like an AI call center solution called Avoka. It's all about you have team members doing something, you want those team members to be doing the highest value thing, right?
John Wilson: Like from top to bottom of the org chart. It doesn't matter where you start. Yeah.
Peter Lohmann: Jon Matzner talks about pushing work down like the lowest.
John Wilson: Yeah.
Peter Lohmann: Yeah. But like even the highest and best use out of everybody.
John Wilson: Yeah. Even at the lowest are they being productive and how do we increase their productivity?
John Wilson: Because if I can increase their productivity, I can increase their output, which means like my investment goes further, or I can reduce like team size or, whatever it is, there's a project we're working on is a home service company. Let's say I get a thousand phone calls a day which is about the number.
John Wilson: So I get a thousand phone calls a day. And 50 percent of them are like not customer calling. So not a potential lead. You have two different booking rates in home service. You have what's called a raw booking rate and you have a booking rate. So the raw booking rate is what was the percentage of calls that I booked over my total volume of calls.
John Wilson: So that could be if I got a thousand phone calls and I booked a hundred, my raw booking rate is 10%. It's not meant to tell you much other than. 90 percent of your calls were bullshit. So like maybe figure that out. Then it's okay what's the bullshit, so you start unpacking that because what the net result of that is 90 percent of your phone pickups are CSRs wasting their time.
Peter Lohmann: Not revenue generating,
John Wilson: not revenue generating. And if we like unpack that, even another layer, like what's the downstream of that? That means that I have to have more CSRs and because I have to have more on bullshit calls, I can't pay them the maximum wage that I would like. So I'm capped for the total skill level that I can bring into my organization from this one problem of Oh, I'm BS phone calls.
John Wilson: So you start to unpack this 1 percent change of like, how do I impact that? Cause if I can reduce. Or steer these 90 percent phone calls away and I can maximize the time on phone for my CSRs, I can upskill my CSRs, I can hire better, we can pay better, and we can, like, all these amazing things. It's nirvana down there, Peter.
John Wilson: It's incredible. Yeah. So a project we've been working on is this right call cSR project. And we're trying to, we have 300 phone numbers and we've treed them out. So that way the calls that are the most likely to be leads skip over, like they go directly to CSR. So Hey, this phone call is a 90 percent chance of being a lead.
John Wilson: It's going to get sent to this team, which has a 95 percent booking rate on leads. So we're going to maximize their output and we're going to try to get them to 70 booked calls a day, whereas a home service company on average might book. 15 a day per CSR. So we want to four or five times that. And then the rest of the calls, like you filter them out to maybe Philippines or maybe like an AI agent handles it, or you can use a AI receptionist, which is what we ended up doing.
John Wilson: We're like the bulk of the phone calls by phone number. We know which one's going to give us the leads and which one won't. We're going to filter that out to an AI receptionist to then basically, to Throw that phone call wherever it has to go Hey, I'm calling in because I have a question on my bill.
John Wilson: Great. We're gonna send you over to accounting. Hey, I'm calling because I saw you had a job at great. You're firing off to H. R.
Peter Lohmann: Okay, I have a bunch of questions already.
John Wilson: Yeah, but it's we're still only like a few weeks into that. But that's an example of just like 1 percent change that will turn into millions of dollars.
John Wilson: of gained productivity, but also like our impact by CSR will be big and they personally will win like financially like they will make more money because we can now afford to pay them more money because we need less and we need better talent.
Peter Lohmann: Alex Ramos has been talking a lot about the importance of sending your best leads to your best people.
Peter Lohmann: Yeah. It results in the best economic output for everybody. Yep. And that is reminding me a little bit of that when you were talking So the AI receptionist, is this just what is this? I'm curious about that. So they call in and an AI answers with a human voice. They don't know it's an AI necessarily and routes them to the right place.
John Wilson: So I'm really passionate about a under 7 second pickup. It's 2 rings basically. I want to pick up in 2 rings. Because if it's faster than that it feels weird and if it's longer than that are they going to pick up? We have the AI for 60 percent of our phone numbers pick up at that 7 second.
John Wilson: And just Hey, thanks for calling Wilson. How can we help you today? I don't actually remember what that scripting is for most of the other ones. It's how can we make a smile if it's, Hey, I need to book a lead. Great. They fired over to the call center. Hey, I need questions on accounting. They fired over to accounting.
Peter Lohmann: What's the name of that AI receptionist? Do you remember?
John Wilson: So it's called Avoca. It's not meant to be used this way. So if you're calling like they'll do it. They helped us with it, but just tell Tyson that that you want what John did because it's we had him, I had him on the show. And the podcast, like two months ago or something.
John Wilson: And we're talking about okay what do the best call centers look like? Cause the call center is there's a lot to unpack there. And it only gets more complicated. Like we're like 30 some people inside that team, like it's complicated. And it's complicated, but the mission is simple.
John Wilson: We just have to book calls. So we're asking him like, what are the, what does best in class look like? And he started describing, oh the best in class, they're really focused on call right. CSR, which we're really passionate about, tech, right job. And we have been for a decade. That's the right lead, the right opportunity, all that stuff.
John Wilson: We've never thought about that. So that was a total unlock. I can't take credit for any part of that idea. I'm grateful to nice and share that. Because that then the next two months was like, holy smokes. Yes. How do we do it? How do we do it? Yeah, because the impact. will be measured in the millions.
John Wilson: This is going to work and it's going to be big. So how do we do that?
Peter Lohmann: I remember talking to you a couple of years ago about when you first started tearing into the call center. And back then this was long before AI was big on the scene. I remember you telling a story, something like you go in there and you realize that like 20 percent of the calls are being missed and half the calls are taking like more than a minute or some horrible metrics.
Peter Lohmann: And then you went in and you're like, Hey, what's. What's going on? Why? What's going on? And they were like, Oh, we don't have the budget to hire somebody. And you're like we're fixing that right now. Like I just, you tell the story about the kind of initial efforts and turnaround and, yeah. And did I get any of that right?
John Wilson: Yeah. A lot of it. And I would say that's a common story for when you acquire a business. So if you like scaling a business is removing constraints. Over and over and over. And that many of those constraints are self imposed for any number of reasons. Like it could be potentially budget.
John Wilson: Often it's the owner's comfort level is the constraint. Like I am not comfortable doing this next thing or like it's a big financial investment. The way that manifests early on in like sub 5 million usually is call center because it's a non. Revenue producing employees that, you don't want to hire more and, you'll hear these like complaints from people of I don't have enough leads.
John Wilson: That's always like the leading indicator for you probably do. And like rich Jordan has a funny story of, he bought this business in 2019 or 2020. And they had three people. And it doubled or I don't even know what in the first 12 months and like the biggest impact thing that he did was hire a second CSR like that was it because that was the self imposed constraint.
John Wilson: They were already getting the phone calls. They just didn't even know it. They weren't tracking it. Because the CSR can only take 80 phone calls a day. So if you're taking on more than 80 phone calls, then that's your constraint you're capped. Like maybe they can go superhuman answer a hundred, whatever.
John Wilson: But if you're getting 200 phone calls a day and there's one person on the phone, Like you have the leads to do more than double your volume. Like they're already there and now you have to remove that constraint. And then the next constraint is capacity. Like you have to hire techs, but yeah, no, we see that all the time because people don't want to bring on overhead, which like I, I get I'm not like immune to that, but if you bring on that overhead, then you're removing that constraint, you're increasing capacity and call center, which then you have to compete.
John Wilson: Increased capacity in your field labor.
Peter Lohmann: Yeah. And the analogy here is like leads per week for our BDM. So we call our salespeople or a business development manager. BDM is the lingo in our industry. So we get about, so RL Property Management gets about 40 leads a week right now, 40 valid leads.
Peter Lohmann: And I believe we're probably approaching, yeah, it's great. Yeah, that's really good. Marketing guy's been crushing it. Yeah. And I believe we're approaching the limits of one BDM. So we may need to hire a second one soon. I'm actually just realizing this as we're talking through it.
John Wilson: And then this is where we go back to 20 minutes ago, where like, when do you start really driving process through a team?
John Wilson: Process matters a lot with one person, matters much more when you have two or three, because now it's like, Hey, these the measurables have to be real. And we have to know, not only know the measurables, but we have to know the inputs that are going to get those measurables that we want. So how do we like codify that into what we do every day?
John Wilson: So that's when it starts to get complicated.
Peter Lohmann: So what you've been articulating over the past few minutes. This sort of theory of constraints as applied to a home services business and Yeah. Diving deep into a specific department, rooting around, figuring out what's holding them back, figuring out what mindsets are at play, and right sizing it and right mindsetting the folks in that department and the department head.
Peter Lohmann: And then I picture you zooming back out and then, you know Taking a broad view and then picking another department, zooming in on that for a while. And I remember you've told me before that this is something only an owner can do, that the skillset of having this broad, high context, high caliber view, like HD view of the business as a whole, and then thinking hard about the constraints.
Peter Lohmann: And then diving in and bringing ideas about like driving work down and all of these things is like a very owner. The owner has to own this function. And I think I mostly agree with that. I'm curious if you still have that thought process and is it still you who's doing that for Wilson? And is that going to be true at a hundred million?
John Wilson: I would take this back to role design. And in EOS a little bit, I'm going to throw a punch or two at EOS. I obviously what my days look like now are really different than even three or four years ago when we first met, I think our business was still in the 4 millions. And so what that looks like changes a lot.
John Wilson: I still roughly agree with that. And, but like my mindset, probably from when I first said that, I don't remember when I said that, but I thought that a lot at two or 3 million. And then I thought that you grew out of it for a certain amount of time. And it was only until the last year or two that I really re grabbed that.
John Wilson: And was, and like it clicked a little bit deeper and I think I'm going to blame EOS a tiny bit here or maybe my interpretation of EOS because I think the way, like the way they lay out roles, they talk, Brandon and I, Brandon's my president. And I'm, I sit in the CEO role and as you're growing a business, a lot of it is, what is the next step?
John Wilson: And what is the what should I be working on as the leader of this group? I'm here to tell you, most people don't know. I don't know. Like I've gotten better at figuring it out. But a lot of my job is like figuring out what's next what is that next change that we can drive? And hopefully the changes I drive are meaningful and worth the time investment that I'm putting in.
John Wilson: But when Bran and I were growing the business from like the three, 4 million range to what it is now, we were looking for what's the model, like, where should my time be focused? Where can I have the biggest impact? And EOS talks a lot about visionary and Integrator, which I think at its core is a flawed concept because like a visionary, like the word, and I've always been vocal that I hate the word visionary I hate it for a number of reasons.
John Wilson: One, I don't want to call myself that, and two, like it implies aloof. The business owners and operators that I know that run 100 million businesses are more tied into their business than I am today. I feel like I have to be deeper than I am today and not visionary aloof. So over the last, Brian and I are growing on this business and we're trying to discover, like, where do we fit?
John Wilson: What are the strengths that I can bring to bear? Which, the strengths you think you have at 3 million might end up being totally different than what your actual strengths are. And he and I really struggled until probably two years ago. To like, where do we fit inside the organization? We're really comfortable with it now, but that took a while.
John Wilson: Cause we kept trying to be like, all right, you're the operator and I'm this thing, or you're the integrator. I'm the visionary. And this book tells us we're supposed to do this. And instead of just Hey, who are we? And what can we bring to the table? So I think that when you're deciding on where you fit.
John Wilson: Inside the CEO seat or inside the president's seat. A lot of it's going to be personally dictated by one. What are you obsessed with? What are you going to watch whether or not it's inside your vertical? What are you always going to be looking at? Because you should probably head up that department if you're obsessed.
John Wilson: Because whoever you hire you're just going to be button heads all day. Like just have that in your vertical. Like I'm always going to look at money. That's it. I'm always, I always will accounting has to be in my vertical or I'm going to piss like 10 people off every day. So what are you obsessed with?
John Wilson: And then I ended up gaining a, not an amazing, but a strong competency for marketing and lead gen. Maybe hand it off one day. I used to think I was terrible at it. So now that reports to me and then after that, think the question was like, do you feel like, do you ever hand over that?
John Wilson: Like zoom in, fix a problem, zoom out, zoom back in. I don't think so. I think what ends up happening and we're still on this journey a little bit is how do you solve the problem and getting comfortable with this idea that, Hey, I'm our org chart is six or seven layers deep at this point. We have supervisors, we have field team members, we have multiple levels of management.
John Wilson: And I have to solve problems through other people. Because I am just capped, like I got nothing left to give. And that's been hard for me because I like, I am like drawn to solving the puzzle. I want to solve it. That's all of this is like a game and a puzzle of like, how can I get a little bit better every day?
John Wilson: So it's challenging to not be able to, Brandon says, drive a cruise ship like a jet ski. So I would say I still do it. With a bigger emphasis on who is going to fix the problem. And when I'm looking at problems now I'm not saying I'm perfect at this cause I'm not, but really trying to nail down, Hey, I'm automatically going to look at this issue and I'm going to figure out how to solve it.
John Wilson: Or at least in my brain, I start like nailing down those pieces. The call center illustration I gave earlier was a great example of Oh, okay, 90 percent of our calls are bullshit. Let's break, let's like zoom out, zoom in. However we want to talk about that. Let's get in there. Let's solve it. But that's a four month project and I have 135 other people that like rely on me to do other things every day.
John Wilson: So it's been a bigger emphasis on who's going to help me solve that problem and like, where do I find the perfect human being that already knows the answer. So we, an example from recent history, not the call center, is we have this problem in HVAC sales right now, where our gross margin isn't what it should be, that's, it's a multifaceted problem through like sales design, material ordering, vendor relationships, and install labor.
John Wilson: It's like kind of a big problem and like the difference between doing it well and doing it badly is a literal million dollars a year. So like big problem worth solving and I could never make headway on it. Like I just couldn't like big problem worth solving.
Peter Lohmann: I've got one of those.
John Wilson: Yeah. And I just can't.
John Wilson: Get anywhere because anytime and this isn't oh, John, you're too busy. It's no, I'm doing my actual freaking job. It's just the thing that I was ignoring was I should have hired the right who to solve that problem. That's just it. I should have gone out and recognize that. Hey, this is a big problem.
John Wilson: We're solving there, but therefore deserving of budget. Deserving of my attention and my attention instead of solving it needs to go towards hiring the person that knows the answer that can solve it in two weeks instead of solving it in two years, which is what we did. And he literally solved it in two weeks.
John Wilson: Like amazing, like very literally. So it's almost aggravating that it took me a year to get my head out of the ground. I feel that way
Peter Lohmann: about we hired a marketing guy. He started July 1st. He's killing it. Yeah. And he's knocked out projects that have been on my list for literally years.
Peter Lohmann: Yeah. Same thing. Yeah. That the who, not how. Great book. You get the idea just from the title, but it's worth a read if you haven't read it maturing as a leader as a CEO is recognizing those who not how problems where Oh, I can see the outline of a job description in the problem that I'm looking at right now and trying to figure out what's the job description, what are the outputs, aka metrics that, you know if I put it on an accountability chart, what are the two or three metrics tied to this role?
Peter Lohmann: Then how do I create the job description? How do I find that person hire them? That muscle is so Useful once you get good at it now, not everything is a who problem You've talked about parts of the business where you went in and did solve the problem
John Wilson: I think that's a part of I think that's a part of this is like sometimes you are the who Yeah.
John Wilson: Like you are or what I've been like really CEOs figuring out what they're supposed to do next is funny because I think like nobody really talks about it, but guys, we don't know. Like I don't know. Like I, I pick it sort of month by month or quarter by quarter but because there's like infrastructure now.
John Wilson: This problem is going to go away from me and the savings should be about a million dollars a year. It's ridiculous or another example of would be, we worked on a weekends, we launched weekends, we didn't have weekends until December and We just launched them.
John Wilson: So it's a new thing for us. And our output on weekends is 40 to 60, 000 a weekend. Now that was a, that's a multimillion dollar change to our organization with a relatively simple idea. Of hey, maybe we should, be there when emergencies happen. Like really big deal. Skeleton crew, we staffed it, we invested in it.
John Wilson: And that's an example of like when you're not working on some of these problems that you shouldn't be working on. Like you get to work on a problem like that. Which is a, that ended up being, no, I didn't execute that thing from start to finish, but I pushed and we got it off the ground and we hired and it was a big part of my focus.
John Wilson: And the difference is millions.
Peter Lohmann: And I think I've heard you talk about like only the owner or only the CEO has this sort of cultural power to push through some of these larger changes. Yeah. Bigger ideas. We call
John Wilson: it moving mountains. But yeah, I think like there are times where another way to say it is like somebody has to break something.
John Wilson: Yeah. And you don't I'm going to give somebody else credit for this quote. It was Mark from permanent equity, but he said managers don't grow businesses, they manage businesses. And I'm like, yeah, that, okay. That makes sense. Like the title alone tells them, cause they don't, because their job is not to break it.
John Wilson: Their job is to literally take what you built and be efficient and effective. But somebody has to move mountains. Somebody has to break something or somebody has to figure it out. So last year, a lot of my work was Around, how do we take something from ideation to team? Hey I want an inside sales team.
John Wilson: Great. Who can you hand that project to that will get it done in a way that matters and like somebody could get it done. Like you probably have somebody smart, but it'll just go faster if we do it. And then you hand it off to somebody who's better at managing it. The difference of the inside sales team is about 5 million of revenue.
John Wilson: This calendar year from creating that inside sales team last November. I don't take credit for that whole thing, but I moved, I broke a bunch of stuff in order to get it. Their budget has to come from absolutely nowhere in order to create these teams. I'm sure there's like at a hundred million, we'll be more strategic.
John Wilson: We'll be more organized about it. There'll be a committee or something like that. But like at the stage we are currently, somebody has to kick the door down and fuck around and find out. So I still believe that.
Peter Lohmann: Love it. Zooming all the way back up to the top of the episode. Your marketing spend is larger than the whole annual revenue for a lot of listeners.
Peter Lohmann: Almost including myself. That was
John Wilson: just the
Peter Lohmann: trailing 12 months calendar.
John Wilson: We won't clip too, but we'll be really close.
Peter Lohmann: Yeah. And I know you've, the classic saying with marketing is I know at least half my budget is wasted. I just don't know which half. Yeah. I'd love to shortcut some of the learnings here.
Peter Lohmann: What have you tried that didn't work? What's working, where's all that money going?
John Wilson: A couple of different ways to unpack this. I will, the way to start is the only thing that matters is leads. And if you can drive that into your, like into your bones, then marketing gets easier. What about brand value?
John Wilson: The purpose of brand is leads. I'm not like I'm not even exaggerating, like the benefit if we distill brand down to like its core concept as an investment, what we are expecting is sustainable, cheap leads. And that's it. We want people to search for us by name. Because we hit them at the top of the funnel.
John Wilson: So branding if marketing's this funnel and the top up by my hair is prospects, people who have never heard of us, never used us, but our potential customers, the next, my forehead is engaged prospects. They've heard of me. The next is active like old customers. They've used us five years ago, current customers, members down by my chin.
John Wilson: So if that's like the funnel of marketing, then. You want to hit each section of that funnel. So my members, I want to hit them with phone calls. I want to hit them with text messages. I want to hit them with whatever to remind them, Hey, you've got this annual tune up coming up. The next one's active customers.
John Wilson: Same thing. Maybe it's emails. Maybe it's postcards. These are direct. And it's actually ends up eating up like a very small portion of your budget because the lower down that funnel you go, the cheaper the leads are. Cause you're already engaged with
Peter Lohmann: them.
John Wilson: Like even the difference between a prospect, which is someone that you've has never heard of you, but could be a customer and an engaged prospect.
John Wilson: The cost of lead is probably two times, like very big difference because they already know who you are. You don't have to build trust in the organization. Like they know you exist. So if we distill branding down all that we're trying to do with branding, Is take the top two sections, people who have never heard of us, and never used us, and people who have heard of us, but never used us, and turn those into leads easily.
John Wilson: It's still just leads. It's just leads. Because that's all that matters. If you're thinking about a branding play, the goal needs to be leads driven and leads like I'm working on a sports sponsorship thing right now. I don't know if we'll actually do it, but I'm working on it. Two different ways you can do it.
John Wilson: You can put a sign in the outfield, which is branding, but what is the measurable impact? Probably not a lot, or you can go deeper, but it's just more complicated. So Hey, I want. To send emails to your ticket holders base and offer them promos for plumbing, or I want to set up a booth every other Saturday game and drive community awareness and direct leads in person.
John Wilson: Or I want to do scratch off tickets when they walk in with a coupon for Wilson, one free furnace. Like it's easy to cut a check for a park bench. To put sponsored by Wilson, but it's complicated to go to the next step, which is where the actual value is found. So when you're driving brand, the big message is like, nobody cares about your brand.
John Wilson: The only purpose of brand is to drive cheaper leads. It's so that someone searches for you by name. And skips the entire rest of the competitive awareness funnel and buys you for 2 instead of you bidding on that same lead higher up the funnel for 80. That's it. You want to spend, a lot less money on that lead.
John Wilson: That's all it is.
Peter Lohmann: And so when you're planning out your marketing and you're thinking through some of these different opportunities. How much of it are you relying on your intuition and how much is it like you're tracking the ROI, you're tracking the cost per lead by channel you're using prior marketing exercises to inform your future spend.
Peter Lohmann: Cause a lot of this, it's really hard to say because what they see your name and they just Google your name, they're not necessarily clicking or using the QR code or calling the special number. And
John Wilson: yeah, it's it's challenging. I think there's a few ways to measure. And the easiest is just like literally how many times is your name Googled and that's brand because all that we're trying to do with brand is people skip the discovery process where they could potentially be suited by other competitors.
John Wilson: You just want them to search for us because they trust us. They've heard of us. That would be how you measure like impact of your branded marketing. I'm getting searched for a thousand times a month on Google. So you can just look that up. There's that. And then everything else is tracked to the hilt.
John Wilson: There's a reason earlier I said we have hundreds of phone numbers. There's a reason we have hundreds of phone numbers.
Peter Lohmann: That's crazy.
John Wilson: It's tracked to the, it's tracked to the hilt. Now, granted, there's obviously like some mix. There's some some of it is fluid. There's a concept called last click.
John Wilson: So okay, they clicked on this page, which was a call button or a a lead form or whatever. And it was on this page on our website, but you really can't give credit to that page. Like maybe the page did some work, but they could have also heard about us from branding. So some of it, you have to make some assumptions.
John Wilson: But a lot of the direct lead activity, you can track. And if you can't, then like you should be working on like the software stack to get it trackable.
Peter Lohmann: What's the software you're using for, I'm curious about like your VoIP software, your call center. And is that the same thing that's creating and issuing all these different phone numbers?
John Wilson: So we put all the phone numbers through service Titan. They have that capability and then we can pull a bunch of reporting by phone number. And then we're using Aircall for our VoIP.
Peter Lohmann: Got it. And does that have an integration with ServiceTitan in some way or,
John Wilson: I, I don't even think it's an integration.
John Wilson: I honestly think it's just like a call forward.
Peter Lohmann: Yeah. We do something similar with RingCentral.
John Wilson: This is fun. I, it's not often that I get to get like super nitty gritty. Yeah. But yeah, I think it's a good time. Like it's a fun challenge running these things at scale. Yeah. So if you like that, check out owned and operated.com.
John Wilson: We're dropping stuff on the week.
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