Pipeline to Profitability Podcast
Education
" Because we have these big ticket calls, we get really good plumbers that want to come and work for us and so we never we have a waiting list of plumbers like if we could get trucks. I could get more plumbers because I have a waiting list probably about 1520 plumbers deep."
- Billy Stevens
Check out this episode of The Pipeline To Profitability Podcast! Allan's guest is Billy Stevens from Berkey's and now with BillyGo.
Billy Stevens, Founder & Former CEO, Berkley’s Plumbing, Heating and Air Conditioning; Founder & CEO BillyGO
Contact Allan Ferguson at Service Success Academy.
Hey it’s Allan Ferguson and I want to welcome you to this podcast pipeline to profitability and proudly sponsored by service success Academy today I have a really special guest and I consider Billy Stevens one of the greatest guys in the industry I all want all also want to say that in my view Billy is without a doubt the smartest guy in the industry he might he might agree he might not it doesn't really matter and so a little bit but I know about Billy and I'm not big on long intros but Billy for a couple of years now I I stalked him on the social world and reached out to him and this man was kind enough to accept a call with me from down under we got to know each other we're both very passionate about the industry and yeah so a little bit about Billy is been in the industry probably same time as me he was the proud founder or had a very successful company called Berkey’s which was taken over by the wrench group Billy had a semi-retirement from what I've been told and I love the story that Billy decided to get back into the industry with his company Billy go which you might like to explain that story as well as what I believe to be the greatest revolution in software for the industry being Sierra and over to you Billy welcome to this podcast thanks for having me Alan I've been looking forward to this one it's always a good time to spend time with you talking and we spend a lot of time chitchatting all the time about all the different things in our industry and you know I can say for a fact that island just a lover of what we what this industry is all about he's always trying to give back he's got a lot of a lot of awesome ideas and I enjoy my conversation with Alan and all the time so again thank you for allowing me to come on to this show to talk a little bit about what we do and who I am and so yeah so I got into this industry my dad was appointed by the way and he you know back in the 70s 80s it was you know it wasn't what it is today it was hard if the economy got bad you had really bad times and if it got good you got busy again and you know I learned from that I never wanted to live that kind of up and down lifestyle and so I came up with a you know a few things that to make my business run year round and avoid all the dips and not worry about the economy ever even back in the you know the 90s when I got started and course now with today's technology I mean if you run your business right you should never be affected by what's going on out there in fact Berkey’s prior to starting the PE firm and doing that you know we grew the most during the O7O8 nine real estate collapse and we absolutely grew more than we ever did in any other three-year. And so if you if you set your business up correctly while times are good you do way better when times are bad and that's just quick advice for me before I get into anything today I don't even think that's in the subject matter but I just I wanted to talk about that so because I know that we've got some issues coming I am hearing a lot from a lot of contractors about it's kind of slowing down not so much in Texas we don't see it as much Texas is pretty much immune from all this stuff that goes on in the rest of the country but um I do hear from contractors every day about how things have really slowed down for them and so that's why I wanted to come on here and talk about our memberships because memberships are the best way to get rid of the pitfalls of slow times and memberships keep your customers coming back for more um you know I started Billy go four years ago and the whole idea behind Billy go was to you know be a beta tester for my software Sarah and Billy go was just going to you know we're just going to grow a little business and then learn how to you know build software around that business and then share it with everyone well Billy go just took off because of the things that we wanted to put in the software just made the company take off and our plumbing side of the business is just astronomical we sell hundreds and hundreds of water heaters every day we sell hundreds if not thousands of sewer line drains replacements every for each week of the year I mean we just constantly stay booked on these things you know we do the occasional faucet repair but you know we like we like water heaters and drain calls and we like making those calls and doing the best that we can with them and our software Sarah really helps those calls find us if you will um it's designed to take to get the customer to pick you instead of everyone else when they're out there searching for a plumber and that's one of the biggest things that has happened and then not only that because we have these big ticket calls we get really good plumbers that want to come and work for us and so we never we have a waiting list of plumbers like if we could get trucks I could get more plumbers because I have a waiting list probably about 1520 plumbers deep wanting to come work for our company because they know what kind of company we run and how they can make a really good living all the time and we and we only hire for no drama so there's a lot of lot of drama free stuff going on in our company but that's what I want to talk to you guys about you know is how do you know over the course of these podcasts with Alan over the next you know months or whatever years we're going to hit on some you know specific areas of businesses that I like to talk about so you know again memberships are where we need to be thinking memberships create revenue for us and the bad times they create repeat visits from the same customers over and over and over again and once a customer trusts you they will buy more from you and you will have lot less money going out the door trying to find more and more customers as you fill up the memberships also are a form of Mr. RRARR which is Mr. is monthly recurring revenue and AR is annual recurring revenue and these are things that are measured on how healthy a business is when you have this type of income other than just a service call and the amount of attention that you can spend on these members when it comes to selling other things is just enormous the average membership customer on Billy go spends $2100 with us per year where the average nonmember spends around 8 $100 a year yeah so it's almost three times the amount of money and they're also paying us to be members of our of our business and this membership is really no different than a gym membership you know we charge $99 a year for it or you can charge 999 a month $9.99 a month and you get slightly more money monthly but you get all the money at one time if you do it annually so what I like doing is is putting on there that we can come in and do a courtesy inspection and this courtesy inspection we can find out a lot about their home just by going to their kitchen sink and we go to the kitchen sink on every call and the reason we do this is because the aerator when you remove the aerator it tells you a lot about the condition of the home we already know there's slow drains in the bathrooms they have you know the lady of the house or they have kids in the house they're drains are going to be straining and slow because of all that hair that are in the shower and drain and in the laboratory drain and so we already know we have something to talk about in those areas because we're going to find all this debris and those pea traps are if you pull it all out from the tub spout or uh the drain in the tub and so we like to go right in front of that kitchen sink can pull that aerator cause that aerator is telling us a couple of things that we can explain to the customer and we don't go there by ourselves we take the customer with us and we walk over and we pull that aerator off and you're going to either see minerals or are you going to see plastic are you going to see both and there's your storyline right there person that's whenever a customer calls you for a leaky faucet or you're out doing inspections you start at that aerator and that plastic or those minerals will lead you to where the water heater the plastics the dip tube right the minerals are in the bottom of the water here and so this leads you to the water heater and now you're getting lay your eyes on the water heater and you get to see how old this thing is and what kind of conditions it is in make sure it's put together with Ed code you know passes code it gives you opportunity to now take a simple faucet repair or just an inspection and turn it into a water heater coil and this is how we do it we always involve the customer I'm going to make sure we ask we're one of the bathrooms are so that we can show them all the stuff in that laboratory P trap or we can do it right there at the kitchen sink as well but there's really no hair in the kitchen sink where you want that hair and that's in that's in the bathroom and once we shell on this stuff then we got it then we're pulling out a camera we're taking a look and where we live the ground moves all the time and I'm sure it's like that in most parts of the country and this is just a simple way to give your customer an idea of what's going on with their plumbing system and for you to have a look at everything and document what you're seeing and maybe there's a sale there maybe there's something you can do to help and that's really what we do that's what memberships help you do they allow you to get in the house they allow you to do this little brief inspection and then find this work and at least quote it and now that you quoted it with our software you can constantly talk to them about it even if they tell you no that day our software will allow you to uh send them reminders about it and make sure everything's going fine just checking in on them whatever it is you want it to say on those emails and we'll help you with those two as well so can I just jump in for a second sure that was basically um exactly what one of the things that myself and Joe Cunningham trained with the perfect service call but the way you did it it just it makes it sound so freaking easy but a couple of things I just want to go back to what you said water heaters and drains I mean if there was ever an area of focus for me based on love water heaters I used to love drains because if priced correctly and you know we're going to depending on time we're going to touch on your margin pricing which is built into your software but drains water heaters and look let let's also look at it this way every home that we get in that we get in front of has a drain they have a water heater and you know I train some of the training I've been doing in the last few weeks and I and I've put together a fairly large library of online training is on memberships and the reason memberships are so powerful and I was blessed to have been introduced to memberships when I joined service roundtable back around 2006 and the very first thing I did was build a really powerful membership plan for my companies and one of the things that we have done which I'm sure you including your membership Billy is we make sure that every membership has a drain inspection because that's really what we want we want the camera down the drain and but yeah love what you've shared so far and hoping today that we have a little bit of time to explore some of the other great things that Sarah does like I've heard some requests from some of the service nation members about your incentive plan which you I sat down with you and Tom peregrino at your office there was a month or two back and you explained the simplicity of your hey plan which was which blew my mind how easy it was and the other thing is how margin pricing works with everything you're about so sorry to jump in there but I had to I had to grab the moment and back to you my friend sure so let's talk about margin pricing and then we'll get into the pay plan so on margins margin pricing so we all I would hope that everyone watching this podcast is using flat rate pricing um it's time if you're not I can just say that you really need to be doing your pricing like this and then the but the problem with just flat rate pricing is we don't get any vision into what the money's going for we come up with a a large number let's say 400 an hour or 500 an hour whatever it is you all come up with 300 an hour or whatever well that's all fine and dandy but you don't really know where this money is allotted and therefore you don't know how much of it is your labor cost you don't know how much of it is is your material cost you don't know how much of it is your overhead cost and all these different things and what margin pricing does it's still a flat rate concept you just get one price to the customer but it's a way to price your stuff and your business that will actually reflect how you want your financial statements to read now if you're not doing financial statements I mean you need to learn obviously we need you need to you know get your taxes done right you just have to and most CPA's are very helpful when it comes to just explaining to you know what cogs are cost of goods sold all these things and so that's what margin pricing does it just breaks it down in a way that you can see specifically where the money is going and where you need to make adjustments so that you can become more profitable and it doesn't always require raising prices it just requires knowing where the money's going so that you can keep more of the money so if you've got a business that's over $1,000,000 you're already generating enough money for you to make 20 to 25% of that there's no reason why you shouldn't have 200 to $250,000 paid to you the owner after you pay everything else on $1,000,000 business the reason why it's not there right now is because you don't really know where your pricing is and where your cost are and once you identify these then you can start zeroing in on those and that's where Sarah really helps you our software really helps you dial in on the numbers so that you can now price your product properly and see how efficient you are the majority of your prices are probably just fine they're probably maybe too high but where you're losing it all is your inefficiency and that's what Sarah does it keeps you efficient it lets you know that when you send tech or Joe Bob the plumber out there to a job that he's got he's spending his time running around looking for parts or maybe he's just a lot slower than the other guys Sarah well identify that for you so that you can look and see that this guy is not making you as much money as maybe another guy so now I need to train this guy and help him get better at what he's doing and get rid of all this running around looking for parts because we can help you with that as well and just streamline your business you know there's a lot of software out there that plumbers are using that just do the basic stuff that are very popular there's several out there I'm not going to name any names but those software that software that you're using now those beginner software is what we call them you know they help you do so much but they don't give you that snapshot of the information that you need so that you can improve your business and all the money that 20 that 25% that should be in your profit and bottom line of your financials it's already in your business you're just losing it through all the inefficiencies that you can't measure with this beginner software it's out there they started jumping again really yes something you shared with me I'd love you to share with our listeners is and this is where we realized that and I've been saying this for years that improve efficiencies by 1% in your business makes a massive difference to that bottom market 2 percent 3% but we discussed the um industry average as far as billable efficiencies is let's call it 40% might be a little bit under for some might little might be a little bit over for others never heard over 40 no you're right and we always our goal was always 50% but it's is it a fact that at Billy go and the companies that you work with Sierra you're above 70% efficiencies yes Sir we're consistently in the high 80% on every single call and that really that even includes the calls where we get no money we even we even cost you know those go against the inefficiencies right and so if a tech goes out for no money that is applied to the overall factor and we're still 8788% month over month when you do I don't know one calls basically the calls that you went out and you sold them and you just compare those we're consistently about 106% efficient so we've got our we got our time and all of our measurements down to the penny now we just need to figure out how to get our efficiency into the 90% range and we have a lot of technicians that have reached this goal individually where they're 90% and I'm talking about not just Billy go but all throughout Sarah and we have this really cool thing that we do with all of them that get into 90% efficiency range and it's become something that text never aware of before and in my opinion it's more important than revenue because if you can become that efficient the revenue will come with it because the efficiency is good and then the profits come right behind it I mean it just changes everything and this can be done guys in little you can change all this in a week from where you are today in a week once you're on Sarah a week running on Sarah and you start seeing the seeing it come clear to you immediately 30 days after running on Sarah you're a master at this and you're working on it and you're getting it done that's the thing that's really cool about it it's don't it's not a complicated software but it does so many things that No other software in this industry can do and it's all automated that's the beautiful part of it we don't require a lot from you we just need to help you on board see what your business is all about get that stuff entered in there and then off you go and this is what we do submit that impressed me Billy sorry to keep good trucking with man but you you're thrown so much gold Nuggets at that everyone something that in in really got my attention and that's why I've got to I've gotta get to know this software that's why I've asked for to go through your sewer Academy which is mind blowing the number of touch points on a call now I think I'm probably won't quote this right but you're correct me I'm sure the average call has 26 to 28 touch points your software got it down to am I right with saying 43 wow that yes Sir we've automated about 20 of those out of the day-to-day walk of life in our industry right um So what we've been able to do is you know cut down on the interactions between you know plumber out in the field or the office the customer we get that we built Sarah to where everybody's on the same page and we simplify all the interactions and automate as much as possible so that everybody can do their job more efficiently and bring more money in for the company because the company needs to make money so that it can survive and it needs to be able to provide with better you know better insurance better lifestyle better everything right and that is what it's all about is how do we simplify these complicated businesses that we run every day and by doing that we create a lot of profit within these businesses and we do it fast it doesn't take years it doesn't it takes weeks in your in your business is transformed into this money making machine impressive now I know we've talked about this and I know the short term plan is not to get the software down under but when it when it does I want to be all over it so something I'll probably talk to you at another time but I would love to be able to I mean I'm a coach in the industry my expertise is helping companies get extreme profit from drains and transference technologies which is something that I II did make a promise to you I want to find an area within Billy gobot I can help you to improve profits it'll be one of my biggest challenges but I'm a very determined individual but so and I want to leave a couple of minutes to discuss your in your incentive plan which I know you've simplified but if there was a contract I'm working with a few contractors in Australia and if there was anything that we know they know that the software your Sierra software is not going down under just yet but what should they do if they want to improve the profitability of their business with some of the software products in Australia are not that good I think there is a there is a an American product which is starting up down under but won't discuss them but yeah so what's something that our Australian friends can do right now to improve the efficiencies to become more profitable without having this amazing product syrup well I agree that I I think the very first thing you should do to become more profitable is you know you need to get a membership program under control you know and get that out there and get that movement and then I think the biggest money exchanger is this pay plan I've I've got a very simple pay plan that technicians understand they get raises all week long they make more money than they've ever made before and the company makes money as well and it's very easy to operate it takes no time at all for them to understand it they can see it whether they have Sarah or not doesn't matter I can I can share that with the you guys down under the digital spreadsheet and then well however you use your currency I don't know what the Australian currency is but it'll work the same you'll never lose another plumber because someone else is offering more money I can tell you that that'll never happen again and then you'll start getting cause more plumbers because of the way that we pay and it doesn't break the bank it doesn't break the bank for the company it doesn't and really helps the technicians as well um maybe on a another show I know your shows are about 30 minutes maybe another show we can dedicate just to this subject alone just the pay system alone I'd love to Billy if you can make that work because that is an area that a lot of contractors really besides being more efficient more profitable but that is an area that a lot of there's a lot of interest especially within service nations so yeah that I would be excited to be able to do that again but you're a busy man we just got to find a time that we can make this work you know so yeah look we're probably getting towards the end of the podcast now I do this to all my guests and I want to thank you again Billy I'm forever grateful for not just the value that you add to me and you've impressed me so much that I'm remodeling my training to be very in tune with the way that Surah works because I know there's gonna be your business is growing rapidly and you've got some big players coming on board which is really exciting for you but this is where I like to conclude every podcast I do and I know that you're an avid reader so is there any particular book right now that you're reading that you would like to record into our to our audience believe it or not I'm reading with my employees rich dad poor dad right I've read it a couple of times already years and years ago but I have bought every single one of our plumbers a rich dad poor dad book and we review that book every two weeks a lot of them don't like reading but the way we engage them in this book I highly recommend that you pick it up and then you give it to your employees it's all about in increase in our improving your culture in your business right and we need to reinvest back into our employees and that's what we do here at villago we really are in tune with our employees we make help them understand money as well and if they understand money then when you're trying to understand teach them about the business and why it's not making money or why we need to make money then they'll understand it better and they'll jump on board with you better and the culture improves and so we simplify the way you pay them we improve the culture that way we talk to them about their own personal finances and help them improve which in again is investing right back in them and should even help you because if you're teaching someone something and you're gonna do it as well and you're gonna get better at it as well and so the answer your questions a long winded answer for a for what book am I reading but we currently as a company or reading rich dad poor dad right now that's fantastic Billy I really love that that's something you know I used to provide regular training with all my team on personal finance investing in real estate anything to help them to get ahead and you know at one point I had several staff working within my company that had multiple properties that they were renting out and anyone that knows the Australian real estate market it's really expensive like you can't buy anything under $1,000,000 now and you know one of my staff you have like 9 properties I'm going Oh my God and he's working for a wage well paid and you know we're I believe in paying our guys well and that's a fantastic recommendation Billy and but again I want to thank you for all you do for the industry there's been a fantastic podcast one that I'm gonna go and listen to because every time I talk to you I learned so much and I'm sure everyone that's tuned in today will as well so thank you again Billy and I really do appreciate everything you do and so this is This Is Us myself the legend Billy Stevens and that displayed a fantastic podcast thanks again for joining me Billy and I'll catch you I'll catch everyone on the next podcast.
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