← Profits with Pajak
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Imagine two customers. One pays you $85 every visit and the other pays you $125. Well, which one makes you more money? Most people would automatically say that the $125 customer is going to make you more money. But what if I told you that the $85 customer quietly made you thousands of dollars more over the course of five years? Because today we're going to be talking about the customers that quietly destroy your profitability. And they aren't always the ones that are paying the least.
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Today's episode is brought to you by Yardbook, the All in one CRM for your lawn care business. And as an exclusive partner of this podcast, you can get started today and begin simplifying your business and maximizing your profits. Sign up now@yardbook.com the link is in the show notes Time now for Profits with Paycheck, an essential podcast for you in the green industry who are looking to unlock the full potential of your business. Hosted by John Pak, your certified financial coach, the show features in depth discussions with successful entrepreneurs, thought leaders and industry experts providing practical advice and proven strategies on financial planning, operations, marketing and sales. Profits with Paycheck has valuable insights and action steps that you can implement today for creating long term success. Now here's John Pajak.
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Welcome to Profits with Paycheck, the podcast where we dive into business strategies and financial insights for the green industry. And I want to just say thank you. Whether you're listening in your truck, your shop or on your mower, I want to thank you for spending part of your day with me. So let's get into it. One of the biggest lessons that I've learned after owning my lawn care business for all these years and after coaching business owners across the country is this. Revenue tells you very little. Profits tell you much more. But there's also another number that most people never calculate, and that's individual customer profitability. You know, we get excited when a new customer signs up. You know, it's another loan, it's another invoice, it's another payment. But we rarely stop and ask ourselves, what is this customer actually costing me? And let's pump the brakes. I'm not talking about the obvious things. It's not like, oh, how much is this going to cost me to fertilize their lawn? Or to service their lawn with labor? Or how much fuel are we going to consume? I'm talking about something that's much harder to measure. It's time, mental energy, interruptions and stress. Because those hidden costs don't appear on your P and L statement, but they are real. And some customers quietly cost you hundreds of dollars every year without you even realizing it. So let's start with the one that we've all met, and this client customer is the price shopper. And stereotypically, let's just say, you know, before they even ask about the service, you know, they ask one question. What's your best price? Or, you know, then they might, you might tell them, and then they say, oh, well, you know, company X said that they'll do it for this. Can you match that? Can you do any better? Well, here's what I've learned. If someone hires you because you're the cheapest, they're going to leave you because someone else becomes cheaper. You know, you've built the relationship on price. It's not built on trust or professionalism or. And a lot of times it's not based on the results. It's just straight up. Price and pricing is always a race to the bottom. And I used to think that every customer was worth chasing, but today I'm perfectly okay with letting someone else win that bid because I know what usually comes next. The next type of person that I want to talk about. These are the exception seekers, and these are the ones that want you to change things just for them. And they never ask for one exception. It's always one after another. You know, it might start out with, you know, can you, can you come a day early? Can you come after 5pm can you skip the backyard? Can you, you know, you just stop by real quick. I need to talk to you. I need to show you something. Can you not charge me today and then just charge me like the next cycle? You know, you get. There's like a bajillion other questions that they might ask you, right? Or looking for an exception, like, oh, just can you do this just for me for right now? You know, a lot of times individually, none of those requests seem unreasonable, but collectively, they destroy your systems. And the businesses that scale have systems. The businesses that struggle, they make exceptions. And every exception creates another decision. Every decision steals time. And eventually your schedule belongs to the customers instead of your business. Think about that one for a little bit. I know, you know, some people that are always asking you for some exceptions. Think about those people. I bet you can close your eyes. You don't even have to close your eyes. You could picture somebody's face right now. And you know who I'm talking about. And I'll tell you what, going back to that, your schedule belongs to the customers instead of your business. Nothing destroys production like one customer changing your schedule. Because you plan your routes very carefully. Your technicians know exactly where they're going. And then the phone rings. Oh, I forgot. We're having a graduation party. Oh, another service provider, another landscaper, or, you know, whatever it might be. You know, another. The H vac guy is coming. Oh, we're watering today. Can you come tomorrow? Well, you know, it sounds simple until you realize moving one lawn means moving another and another and another. And that one customer just disrupted an entire day's production. And they're not paying, you know, they're not paying for that. That disruption. You are. Back when I was getting my lawn care business off the ground, I was juggling routes, invoices and customer notes with paper and prayers. It was chaos. Until I found Yardbook. Yardbook gave me the structure. It helped me track chemicals, route efficiently, invoice faster, and most importantly, it helped me grow a profitable business. If you're tired of duct taping your systems Together, go to yardbook.com and sign up for free. And if you're ready to go premium, use promo code PAYJACK to get your first 30 days on me. Hey, guys, John Pajak here. If you're a lawn care operator, landscaper, hardscaper dealer, or anyone working in the green industry, I want to highly encourage you to take a serious look at Equip Expo this October in Louisville, Kentucky, because Equip Expo is the largest trade show and educational event in our industry. For three days, you're going to have the opportunity to see the latest equipment, test drive machines, attend educational sessions taught by industry leaders, and network with thousands of contractors from across the country. I've been attending for years, and every time I go, I come home with new ideas that make me money, save me time, or help me run a better business. So let's talk numbers. Registration is currently $30, but if you use promo code paycheck, you're going to save 50% and get your ticket for just $15. And if you wait any longer, prices are going to keep going up. So the question isn't whether Equip Expo is worth the money. The question is whether you can afford to miss the opportunities waiting for you there. So head over to Equipe Expo.com, use promo code PAYCHECK, and I'll see you in Louisville this October. Link is in the show notes. One of the big things I want you to understand, something that I've learned is that you don't build a great business by saying yes to Everyone. You build it by creating systems that allow you to serve the right people exceptionally well. So let's get on to the next person now there. I swear, every company, everybody that I've coached, everybody that I have experienced, like at events like Equip Expo and things like that, you know, eventually this person comes out, this type of customer comes out, and it's the professional complainer. No matter what happens, something is wrong, it's too much rain, not enough rain, too many weeds, the grass grew too fast. The grass didn't green up fast enough. You know, the technician parked wrong in the, in, in the street, or that, you know, the invoice, you know, they have problems with their invoice. Oh, it came too early, or you charge. You charged my car too early or, um. Oh, no, no. You know, I, I, I expected it to be done right after service, you know, and you start noticing something. They're not looking for solutions. They're looking for something to complain about. And those are very, those are two very different people. You know, you cannot satisfy someone whose favorite hobby is dissatisfaction. It is one thing if your customer has a valid concern or complaint, because generally those people, they just want to make sure that they're protecting their, their needs and the things that they're looking for. And if you drop the ball a little bit, I think it's perfectly okay for a customer to call you out on it. On the other hand, like I said, dealing with that, that's, See, that's. They're looking for a solution that's totally different from what I'm talking about with the, the people that love to complain. You know, there's, I could, oh, man, I could flash back in my mind, Even going back 25 years, I could still remember vividly one client in particular. It was not my client. It was. I was working for another company. And I just dreaded this place because that woman would stand out there. She was getting cut every other week. I know her name. I don't want to say her name out loud, but I remember everything. Her and her daughter would come out and stand there and watch us work, and every. We could do everything exactly we did the week, the service before. But even if we repeated that, she would still complain about something. And it was like I didn't realize until many years later that there was no satisfying her. And again, it wasn't my company. The only reason that she was tolerating it or whatever is because we allowed it. We. I couldn't say no. I couldn't say, I'm not serving you anymore, because I was in the middle of it. I had no choice. I had to serve her. And I'm sure that my boss at the time was not charging anywhere near what he should have been. And that's why she got a good cheap price and she got to dictate over two men what needed to be done, even if they were doing everything flawlessly. Her daughter was a sweetheart. She was an older woman, but at the same time, she was always like, I'm so sorry, I'm so sorry. But anyway, that type of person will drain you. They will bombard you with, make you feel like you're doing something wrong when you're not okay? So that's, you gotta again. 25 years later, I am, I could still remember this woman. I could still remember the situation I was in. That's a lifetime ago. But anyway, this next type of person, this hits close to home for me because I am personable and I want to satisfy people. I want to help them. You know, here's the scenario. You know, you answer the phone, they say, I just got a quick question. And then 45 minutes later, you've diagnosed the lawn disease, recommended fertilizer, You've explained how to irrigate it properly, you've talked about the insects, and you've discussed overseeding and answered any and all questions about crabgrass. And then they finish with, well, I'll think about it. You know, they just received a free consultation. Your expertise has value and don't be afraid to protect it. These type of people, whether they are potential people, potential clients, or they are existing clients, and they just talk to you about every single thing. And then they're like, well, yeah, yeah, yeah, yeah, let me think about that. I mean, I have all the information in front of me. I took 45 minutes of your day to talk about it too. I'm still not convinced. You know, whatever. It's. Sometimes when you do that, it gives them ammunition to go find other people. And I, I had one client that did this to me about three years ago where I was speaking with her about, you know, taking care of her lawn. And I, I sensed it. I could sense it on the phone. And I said, you know what? Before we start any program, we're going to do soil testing. Because she was giving me a line of how four other companies have treated her lawn and they can't figure out what is wrong with it. So I immediately said, well, we'll do some soil testing. I went and did the soil test. She paid for that soil test. She Paid for my time, for the consultation. And when I presented what I believed was the best program for her, even though I had the data in front of me, I had the soil test from the lab, she still was questioning me. And she was like, well. And I said, you know what, before we go any further, there's no way of truly being able to tell you what's going to happen unless we start this program. Because I was tired. I was like, I'm not going to allow her to waste more of my time, waste more of my resources. And again, not to be. It's not being rude. It's just we have to protect our time, too. Because the time that we spend on these people that may or may not, they probably won't spend money with us, could be time spent on our great customers that truly do value our time. And we don't want to rob anything from them because they're the good clients. They're the ones that are, okay, I believe in you, I trust in you. And they see the results and they're very happy. So anyway, sometimes you can really dodge the bullet by standing your ground and standing firm. This is why it's important to have a system like that in your business to where you just like, okay, this is the protocol we're going to follow. We're still going to be hospitable. We're still going to be polite, we're still going to be informative. But at the same time, we have boundaries, we have limits. And this is what we can offer you. If you cannot move forward with it, then, and I hope you're the best. There's one customer in particular. It's not like a name, but the personality type that drives me. It almost this. These people are almost the ones that infuriate me the most. And it's because these are the chargeback customers. And what I mean by that is that if you haven't had it done to you, you know, if you're. If you're dealing with credit cards and things like that, there's very few things that are more frustrating than a chargeback because you did the work, you documented it, you took pictures, you sent the invoice, you communicated. You get the. You actually had the payment in your bank account. And then one day you get a notification that, you know, this charge was not authorized. That's a, you know, it's kind of a sucker punch. You know, it's like you don't see it coming. And now you're gathering paperwork, you're getting all your evidence together. You're writing explanations to the processing company, and a lot of times you're waiting weeks for the answer because most of these cards, they will always side with the person that made the charge back. And then it's up to us, even though we did all the work to prove that we were in the right. And the crazy thing is, a lot of times this takes a long time. This might take weeks to get an answer. And sometimes it's not the right answer. Sometimes it's just a notification that, well, you're still looking into it. And a lot of times the money isn't even the worst part. It's that feeling. It really makes you question people. It steals your confidence. It really makes you wonder if the next customer is going to do the same thing. And I'll tell you that emotional cost is something that most people never talk about. But the funny thing is, your best customers rarely call. They trust you, they pay on time, they recommend neighbors, and they leave you five star reviews when you see them in public. They wave by you when you drive by, and they really appreciate your expertise. They don't need constant reassurance. And those customers just don't generate revenue. They generate peace. They allow your business to run, they allow your employees and your technicians to succeed, and they allow you to focus on growth instead of damage control. You know, when I first started my business, I believed every customer was a good customer. I thought success meant saying yes to everyone. You know, more customers, more income, more revenue, you know. But experience has taught me something very different. Some customers don't make your business stronger. They make it heavier. It's heavy with interruptions, it's heavy with complaints and stress and uncertainty. And then the businesses that become truly profitable aren't necessarily the ones with the most customers. They're the ones with the right customers. They're the customers that trust you. They respect your process, they value your expertise, and they allow you to do what you do best. So I have a small challenge for you this week. Instead of asking yourself, who pays me the most? Ask yourself, who costs me the most? Because those answers are often very different. When you start building your business around profitable relationships, instead of just chasing revenue, everything starts to change. And again, a lot of those things, they aren't measurable on a profit and loss statement. You have to make notes. You have to have a system within your client base so that you could record these things. Any complaints, any bad email, you know, any email transaction, text back and forth, maybe a phone call, make a summary of it very quickly and put it in their file. You're going to start. I'll tell you what, when you start seeing the problem people, the ones that match any of that, you're going to start seeing a pattern in their notes, and it's almost predictable that they're going to either leave you do a chargeback, just be a constant complainer, or any of the above that we discussed earlier. So I want to thank you for listening to this episode. You know, I hope that this has been helpful for you, and as always, God bless you. Keep pushing through and we'll catch you on the next one. Thank you once again for listening. If you've enjoyed the show, please leave a review and share it with fellow business owners. Your support means the world to me and helps keep the show going strong. I want to give a special shout out to our friends at Yardbook. Their continued support has been instrumental in bringing this podcast to you week after week. If you haven't checked them out yet, visit yardbook.com and see how they can give you the tools to streamline and make manage your lawn care business. Also, don't forget to explore the resources and upcoming events that I've collected just for you in the show Notes. These are curated to help you stay ahead in your business with the latest tips, tools and networking opportunities. Whether it's a new tool, an insightful article, or an event you don't want to miss, I've got you covered. Until next time, keep pushing through and God bless.