Full transcript9 chapters · 13,484 words
00:00Fourth-generation oil tank kid with seven children
Teddy Slack Jr: My grandfather installed the oil tanks. I built the companies that pulled them out. Four generations of lessons taught me how to turn chaos into profit.
Narrator: Welcome to Profit and Grit with Tyler, where blue collar owners and insiders spill the real story behind their hustle, building businesses that thrive through sweat and smarts. We’ll dig into their journeys from scaling chaos to growing the bottom line with lessons and grit that pay off big.
Narrator: Here’s your host, the Blue Collar CFO, Tyler Martin.
Tyler Martin: Hey, welcome back to another episode of Profit and Grit. This is Tyler. Today we’ve got someone who’s lived the full cycle of blue-collar business. Failure, rebuild, and the big exit. Teddy Slack Jr. is a fourth-generation entrepreneur who has started five service businesses, each scaling into seven figures within the first year.
Tyler Martin: He built simple tank services into a$4 million business with profit margins north of 40%. Pretty good numbers. He sold it for a 5x multiple, and he now runs Modern Contractor, where he helps other trades owners build lean transferable companies. Teddy also sits behind bizscore.ai.
Tyler Martin: This is a financial health tool for service businesses. And he’s writing his book, Profit Driven Growth. So this conversation is about hitting rock bottom, clawing your way back, and building systems to set you free. Let’s get into it and talk to Teddy now.
Tyler Martin: Hey Teddy, welcome to the Prophet and Grit Show. How are you doing? I’m good, Tyler. How are you doing? Good, good, man. I’m I’m so happy to have you here. I want to learn about you as uh we’re introducing you to the audience.
Tyler Martin: What do you do professionally?
Teddy Slack Jr: So currently I’m doing some coaching right now, some consulting in the home service business. So, you know, dealing with different uh companies such as roofing, I’m doing plumbers, I have some, you know, other environmental companies I consult with, you know, basically anything in home service businesses.
Tyler Martin: Yeah, and you’re like the blue-collar man to me. Like when we say blue collar, like, you know, some of your businesses, I believe you’ve had five businesses, five service businesses. I’m like pretty hardcore oil type industries of some hardcore blue collar. Is that a fair statement?
Teddy Slack Jr: It is. I mean, yeah, I come from that, you know, third generation. I grew up in it, you know, operating heavy equipment as a young boy, you know, dealing with dirt and and oil and you know, hazardous materials. I just grew up around that.
Teddy Slack Jr: So that’s what I know.
Tyler Martin: That’s very cool. What about something on a personal note? Anything you can share about yourself?
Teddy Slack Jr: Yeah. So I have seven children, which shocks people. Yes. Uh and we have a four-month-old, and our oldest is uh 15. So it’s a it’s a wide range, but we could we come from a blended family and there’s seven of uh seven kids.
Tyler Martin: So that’s a lot of kids. So my partner many years ago, the business we were in, he was raising five kids, and I would hear all the stories of you know, ones in baseball, ones in dance, ones in I can only imagine seven.
Tyler Martin: That’s a whole nother level.
Teddy Slack Jr: I I have a 12-passenger sprinter van. I call it the bus, and that’s how I get them around.
Tyler Martin: Wow. That must be uh a lot of when you got a handful of kids in there, I imagine that’s a pretty interesting ride. Yes, it is. Yeah, that’s funny. Okay, hey, I want to start out with what I call your rock bottom moment.
Tyler Martin: And I I’m going back to 2018, and you made one decision that you know some might say a bad decision.
03:32Scaling five companies by 28 and letting it go to his head
Tyler Martin: Can you talk about that and how that played out?
Teddy Slack Jr: Yeah, absolutely. So going up to this point, I mean, I grew up, like I said, third generation. I grew up in a family business. I started a residential division with my father in the he was in environmental business for years, for 35 years, but he was doing commercial environmental work, not really much residential.
Teddy Slack Jr: So out of college, he’s like, Hey, do you want to start a residential division? So I said, sure. I got that up and going. That scaled pretty quickly. I had no experience of scaling companies at that point. I mean, I built the website, the logo just from scratch, and that scaled to seven figures within the first 12 months.
Teddy Slack Jr: And I ran that for five years. And unfortunately, it’s very difficult working for family, as a lot of people listening might know. Uh, and uh, so we decided to part our ways back in 2009. I went off on my own. The same thing, start the same exact type of business, scale that to seven figures very quickly.
Teddy Slack Jr: And unfortunately, if you scale any business uh from scratch and you’re you know successful at it right away, as a young man, I was 28 years old, it got to my head, right? So I was like, I could do this with anything, you know, like in your sleep.
Teddy Slack Jr: Exactly. I can do this in my sleep. Business is so simple. What it’s really not. I mean, you know, so once I start going all these different directions, I started a hazmat spill response company, which did well. It did millions of dollars of revenue, you know, year one.
Teddy Slack Jr: And uh, you know, then I went into a door knocking business in the Bronx with a friend of mine from college. Then I went into real estate. I flipped 24 houses in 24 months. I mean, scaled like quick stuff. So, and and I’m doing all this stuff simultaneously.
Teddy Slack Jr: And then uh I had an issue with the the hazmat spill response company that I was running for about five years around 2018, and uh I had to shut it down. So that division was generating about three million in revenue, and I start to panic because I’m like, I’m losing all that revenue, even though the business wasn’t profitable at this time, it’s still money coming in, it’s still cash flow, right?
Teddy Slack Jr: So still paying bills. So once I shut it down, I panicked. And my CFO at the time, who was in-house and he was like, Listen, I have a connection with these guys out in Ohio, they are working around the fracking industry, they have contracts with public key traded companies doing fracking.
Teddy Slack Jr: They want you to buy the trucks and just they have all the guys to drive the trucks. All you gotta do is rent a facility, get the equipment, and we have the contracts in place. So at this point, I’ve scaled so many companies bootstrapped with no personal guarantee, no loans or anything.
Teddy Slack Jr: But this in particular needed a million dollars in equipment. And I didn’t have a million dollars in cash. So I was like, Well, uh, let me see what I can do. And I went out and I got approved off the balance sheet of my main company.
Teddy Slack Jr: They’re like, Yeah, you got a good company here. I’ll give you the loan. So I did that. I got a personal guarantee on a million dollars equipment. We got into the uh business right away, making money. I mean, 300 grand in revenue month.
Teddy Slack Jr: Number one, we were doing 300 grand revenue. But the problem was it’s 24-7. So the bills are coming in fast, faster than I could ever imagine. And uh, I didn’t have cash, enough cash behind me to keep the feeding the beast, right? So uh I tried to go get loans, and as you know, brand new business, they’re like, Yeah, you’re not we’re not, you know, we’re not gonna loan you any money.
Teddy Slack Jr: So I turned to factoring, which you probably know it’s not a good idea. Yeah, this bad idea. So I I turned to them, and what I didn’t understand about factoring at the time, and now I know obviously, is they don’t look at your credit, right?
Teddy Slack Jr: They look at your customers’ credit because they’re basically giving you money on the invoices. So, and I’m figuring, well, they’re publicly traded companies, they must be have great credit. Well, long story short, they didn’t have great credit, and I needed about 150 grand just to pay the bills every month, and they would only approve me for 50,000 a month.
Teddy Slack Jr: And I just couldn’t come up with 100 grand a month to keep it keep feeding the beast. And now looking back at it, I you know, because I’ve gone through it, I’ve there’s other options I could entertain at the time, and I just didn’t have it.
Teddy Slack Jr: I didn’t know. At that time, I wasn’t reading books, I didn’t educate myself about business, I didn’t have a network of people that I have now. So I wind up just shutting it down and they had come for everything. I mean, personal guarantee, they don’t mess around, you know?
Tyler Martin: Wow. So so hold on, because there’s so much to unpackage here.
07:07Why factoring against publicly traded customers still sank him
Tyler Martin: Okay, first on factoring. Yeah, let’s talk about that a little bit because nowadays they don’t always call it factoring. They kind of have different terms for it. And I even forget the term. So you got to kind of keep your guard guard up if anybody is listening out there.
Tyler Martin: Basically, you give an invoice, and we’ll call it a bank, but a lot of times it’s like some private company. You give them the invoice, you the invoice hasn’t been paid yet. Yep, and then the that institution will give you a percentage of the money, the business.
Tyler Martin: It might be 70%, it might be 80%, it just depends. The minute you get paid, that that payment goes to them. Or in the olden days, which is probably even your before your time, Teddy, what would happen is the the customer would send you the check, the business, and it was your job to remit it back to the institution.
Tyler Martin: Well, what would happen many years ago is sometimes you’re cash starved, and that check would get deposited into the business. And now you’re double in the whole you owe for the invoice and you got paid by the customer and you’re out of cash.
Tyler Martin: I will tell you this, Teddy. I have seen one scenario in my entire career where it worked. Yeah, and it was actually the one business that I went into, and it wasn’t when I was at the business, it was before it. They used it in the first year, it was a staffing firm and they had giant invoices that were on net 60, and they were paying labor, the consultants, to bill the client, but they and then they were paying the payroll, but they weren’t getting the billings until later.
Tyler Martin: And that allowed them to bridge the gap to growth where they had enough profit. But the margin of error is small because if something goes wrong, you’re dead, right? So, so my question was what was the, and sorry for getting off on that tangent, but it’s passionate to me.
Tyler Martin: No, it’s okay. What were your like your big learning lessons from that failure? Like what if you had to do a do-over, what would you have not have done and what would you do differently?
Teddy Slack Jr: So for me, I mean, uh, you know, not knowing where to turn, right? So I could have brought in equity partners. I had the contracts. I mean, I had amazing contracts with these publicly traded companies. I had the equipment, I had the manpower, I had the facility I rented for the year.
Teddy Slack Jr: I mean, I had everything aligned. If I would have had a network of people that I could have turned to, I probably could have brought an equity partner and say, hey, I’ll give you 50%. Just be the cash partner in this deal. I just need 150 grand a month and to keep the beast going, I had the money coming in.
Teddy Slack Jr: So there’s things I could have done. But at that point in my career in business, I did everything through hustle and grit, you know, and uh I did, you know, with the show Profit and Grit, it was hustle and grit at the time.
Teddy Slack Jr: I didn’t know anything about business except for just what I was taught, you know, from my father who was super old school. And he did it, he started out with zero two and grew with the business he grew. And, you know, when I start when I crashed and burned, everything crashed and burned, I start reading, right?
Teddy Slack Jr: And that’s where I started learning a lot of things. And that’s where I start thinking, like, damn, I could have done this different, I could do that different. You know, so educating yourself about business and it doesn’t take much, you know, listening to podcasts like this, you know, reading books about different, you know, avenues of business, whether that’s marketing, operations, sales, and you could learn so much because they just don’t teach in college.
Teddy Slack Jr: I went to college and I didn’t learn anything about how to run a business in college. I just didn’t.
Tyler Martin: Yeah. Yeah. Teddy, one thing though, you know, I do agree with you. Like you did great. You had multiple businesses. Now you’re in a great situation with this next business. Was it all just about not having the experience? Or do you think part of it was ego too?
Tyler Martin: Because it sounds like things came to you pretty quickly. You’re obviously really good at what you do. So, do you think ego played into that?
Teddy Slack Jr: 100%. Like I said before, I mean, at 28 years old, you know, I generated a million three in revenue within like 12 months, like from scratch. That can get to your head, you know, and you can, and especially when you’ve never done it before, it’s like, holy shit.
Teddy Slack Jr: And then you do it again a second time. So it really got to my head. So absolutely ego and you sometimes you just need to get ego checked in life. I mean, and it it really what it did to for me after 2018 is when I went back to my main business, the residential tank services, and we revamped and restarted simple tank services.
Teddy Slack Jr: I mean, we had no debt. I had took no loans. We and we very slowly and methodically grew that business to the point where we looked and dialed in every single number. I mean, I owed nobody any money. The vendors were paid ahead of time to save percentages off.
Teddy Slack Jr: I mean, we did everything, I believe, the right way. And it was a whole different type of way of running business. Where before that time, I would take a loan for anything. If you would give me a loan and I could grow, I’ll give you the loan.
11:11Losing his mother and four years of silence with his father
Teddy Slack Jr: Let’s go, let’s go. It was just grow, grow, grow. And you, you know, as you know, you could get yourself in trouble, you know?
Tyler Martin: Yeah, for sure. Okay. And then one other thing before I wrap up this segment, I want to go back to a comment that you made. You had a business with your family and it didn’t work. I think there’s a learning lesson in there because a lot of home service businesses are family.
Tyler Martin: Yeah. You know, you have a son, you’ll have mother doing the off basket office work or whatever. There’s a lot of family. What was your takeaway from that falling out in your family event? Did that spill into your personal relationships with your family?
Tyler Martin: Talk us through that a little bit.
Teddy Slack Jr: Yeah, sure. So when I started that division inside of my father’s business, at that time, my mother was involved in the business as well. She did all the bookkeeping. She had done that for my father’s whole life. So my mother helped me, you know, with the bookkeeping aspect of it.
Teddy Slack Jr: And we just uh what I did is I started very slowly, same thing. Like I didn’t have guys or anything like that. But my father would let me use his guys, and I went out and I did the marketing and I got the phone to ring.
Teddy Slack Jr: And very slowly we grew that and uh we put we stashed some profit away and we start investing into equipment. So we did it very methodically, and that’s how I learned how to kind of bootstrap essentially. It was my first kind of foray into bootstrapping a business.
Teddy Slack Jr: And um, unfortunately, my mother passed away in 2008 of cancer, and uh yeah, it was it was a tough time for the family, and uh, she was a big part of the family business that you know, and you know, things kind of just start to go sideways.
Teddy Slack Jr: My father wind up leaving the business, he had to deal with hate without he had to deal with uh, you know, with the passing and everything like that. And uh then he came back after being gone for a year, and then me and him just went at it because it was like, Hey, I’ve been here for a year, you left, and I got this thing run, it’s humming right now.
Teddy Slack Jr: And then he, you know, it was just like two masculine, you know, you were just two type out per a personalities like going at it, like, you know, and he’s very old school, and I’m more new school, where again at the time I’m like leverage everything, let’s grow, grow, grow.
Teddy Slack Jr: Uh top line revenue. That’s all I cared about. My father’s like, slow down, you know what I mean? Like, you know, so I probably should have listened to my father at the time, right? I mean, absolutely, that was a lesson that I took.
Teddy Slack Jr: I should have to listen to him a little bit more on that front. And uh, yeah, it’s just really difficult uh working for family because then yeah, it does spill into personal. Unfortunately, him and I didn’t speak for almost four years after that breakup there.
Teddy Slack Jr: But now we’re best friends, we are closer than we ever were, you know, and we talk almost every morning. So we have a great relationship.
Tyler Martin: Yeah. One thing I want to share with you because I can relate to you. So I lost my dad last year. Oh, so are you there? When I lost him, it kind of changed the family dynamics a little bit. And then literally two weeks ago, I lost my mother.
Tyler Martin: She was 88, she was older. But it’s funny how you know, you have family members, and in your case, maybe your mom, they’re kind of the fabric of keep keeping the family together, the siblings and everyone. And it’s I’m going through that phase right now where the over the last couple of years things have really dramatically changed in terms of, you know, you just always go to moms, for example, for Christmas, and that doesn’t happen anymore.
Tyler Martin: And it’s just keeping that all together. So sorry to hear about your loss. I’m kind of in the same situation. Sorry to hear that too, man. Anyway, it’s never good. It never is. It’s hard, but it just, you know, it gets to be time in life.
Tyler Martin: Sometimes, unfortunately, things like this happen. Yep. Okay. So I want to go over now to the turning point. So we we talked about the rock bottom. Yep. And I’m talking mostly about launching simple tank services.
14:13The $600 soil investigation that let him quote a fixed price
Tyler Martin: You went into like a fixed pricing model, and that industry is generally known as being a shading industry. So talk to me about how did that become a differentiator? What moves were you making where you were like, man, this is a turning point that’s really taking off?
Teddy Slack Jr: Yeah. So uh for that business specifically, I wind up partnering with somebody who was in the industry. He had been in the industry for almost 35 years. But again, old school mentality, you know, he never really grew beyond like, you know, I think four or five hundred thousand top line revenue at the time.
Teddy Slack Jr: And my previous business, which was the same exact business, um, qualified tank services. I mean, we we topped out at like two and a half, three million. So I was used to getting, you know, decent amount of revenue in that industry, anyways. Again, it’s a very, it’s very intricate business.
Teddy Slack Jr: So in that business, uh, unfortunately, like you said, there’s a lot of shady characters. You know, the way that they do the pricing forever since I got, I mean, I’ve been in it since 2000. My father was in it for years before that, but more mainly commercial.
Teddy Slack Jr: But the way it works is this. So you’re dealing with underground oil tanks, everything’s underground. So there’s a lot of unknowns. We don’t know how big your tank is. We don’t know, and there’s no records on town of these tanks were put in in the 30s, 40s, and 50s.
Teddy Slack Jr: The townships don’t have records. So there’s a lot of unknown stuff that you’re dealing with. And then once you open it up and you remove the tanks, a lot of times there are environmental impacts into the ground. And again, we don’t know how far the contamination traveled.
Teddy Slack Jr: That’s like the whole story they tell, which is true. It is the God’s honest truth. You don’t know how far the contamination has traveled. But most of the contractors would lean on that and they would tell a customer, Hey, yeah, I’ll do this for you know, eight grand, starts at eight grand.
Teddy Slack Jr: I don’t know what it’s gonna be at the end of the job, but it’s gonna start at eight. So now you got a homeowner who’s signing off on a blank check, essentially, like, hmm, let me give this guy eight grand, just trust that it maybe it’s gonna fall around 10, 12 grand.
Teddy Slack Jr: But sometimes they’d come back at 40, 50, 80, 100 plus thousand dollars to do a cleanup. So you start at eight and it can go into six figures within three days. I mean, I’m talking three days, I could give you a bill for 100 grand.
Teddy Slack Jr: I mean, it’s crazy how it would work. So customers didn’t like that, obviously. Who would the hex would who would like that, right? And I knew what my customers’ pain points were, and they would always tell me, Can’t you just give me a price?
Teddy Slack Jr: Can’t you give me this price? So, in the in the commercial environmental industry, they have what’s called the geoprobe and they go out there and they do what’s called a soil investigation and it’s called a delineation, and they would charge upwards of 4,500 bucks to investigate a property.
Teddy Slack Jr: So, hypothetically, if you’re gonna buy a commercial property in New Jersey, anyways, you have to do this investigative work, and it’s about$4,500. Well, no homeowner is gonna spend$4,500 on doing this work ahead of time. But what I did is I went out and bought the equipment and I invested in the equipment, and then I trained my guys and I basically cut all the services that are required to do that, except for the actual investigative work.
Teddy Slack Jr: So I didn’t include any sampling, I didn’t include any reporting, like all the stuff that added up to 4,500. And I said, I’ll do this for 600 bucks. I just came down to like what my true cost was. I’m like, it’s basically a cost driver for me, just cover my cost, but now I could give you a fixed price.
Teddy Slack Jr: So now for me, it was like, hey, I could go in there and I could drill around and I could tell the customer, hey, this is gonna be 17,500 bucks, and that’s it, no matter what. If my investigation is wrong, you’re still gonna pay 17.5.
Teddy Slack Jr: If it’s right, and maybe I have a little bit of a uh, you know, uh insurance factor in there where it’s a little bit padded, then I do well, right? And sometimes I did really well and sometimes I didn’t. But uh overall, when you ran the numbers, it worked out, so it was amazing.
Teddy Slack Jr: Nobody else in the industry was offering it, so the customers couldn’t price shot me. They would come and be like, Well, I’m gonna go price this around. Like, no one else is offering this, so good luck. You know, if you want a fixed price, and I would give them the option.
Teddy Slack Jr: If you don’t want a fixed price, we could go open-ended too, but then you take all the risk and liability where I’m taking all the risk and liability on this fixed price item. And uh the customers loved it, they absolutely loved it, and it was very profitable for me.
Tyler Martin: How much were you qualifying? Because to me, it’s like 600 bucks for a lead. You’re you know, that’s your cost of acquisition. How much were you qualifying them, or what were you doing? Was it anybody that expressed interest you’d go and do that, or did you kind of was there certain criteria that you had before you’d invest 600 bucks, basically?
Teddy Slack Jr: Yeah, so they’d have to sign the contract and uh for the 600 investigation, we go out there and I’d have to bring that equipment out there, we would drill down and do the investigation, and then I’d give them the price. And sometimes they didn’t sign on, but at least the 600 covered my cost to do that investigation.
Teddy Slack Jr: Yeah, so you were break-even guy. Yeah, exactly. Yep. But the the other thing, so that was for the remediation aspect of the business. The other thing that I changed was the the tank removals was what increased my closing cost, my closing percentage. So, for example, again, it was open-ended.
Teddy Slack Jr: So they call, I have a 550-gallon tank. Okay, where is it? It’s in my front lawn. Again, it’s like, all right, well, it starts at 1200, and then these line items that go up depending on permits, disposal costs, uh, access issues, blah, blah, blah, blah.
18:38Flat rate 1,400 for tank pulls took closing from 45% to 75%
Teddy Slack Jr: And then before you know it, it’s$2,500 to pull your tank. So I went out there and I looked. What I did is I ran all the numbers. You’ll like this CFO guy, right? I ran all the numbers and I literally put them in an Excel sheet.
Teddy Slack Jr: I’m like, all right, so over the last 120 days, I looked at how many additional line items we charge for, and I came up with an average price. I said, on average, we’re charging customers about 200. So let’s just throw it in there.
Teddy Slack Jr: So I’m gonna make flat rate 1400 bucks, and boom, my closing percentage went from like 45% to 75% because the customers were like, same thing. They couldn’t price shot me. They’re like, nobody else is offering flat rate. I’m like, exactly. Hire, you know, hire us.
Teddy Slack Jr: It’s one price. I’ll include the permits, I include everything. I mean, it blew my competitor’s minds. They’re like, you’re gonna lose your shirt. You can’t do this. I’m like, lose my shirt. My closing percentage went up 30%. I’m like, do the math on the average ticket.
Teddy Slack Jr: I’m like, the amount of revenue I’m driving in this place right now, it just was insane what I did, right? So and my competitors hate it now. They all have something similar, you know, that they’re doing, you know.
Tyler Martin: So, what’s the learning lesson here? Because my takeaway is you were okay. And this is hard sometimes. I think I see this in my own practice with owners, is to accept that some deals aren’t always going to go your way. But if you can look at the all of the deals and aggregate, you’re gonna be fine.
Tyler Martin: But I think a lot of times they just the one deal eats them up of the loss more than the 20 that are positive. How did you deal with that? Or is that just what you’re in your DNA?
Teddy Slack Jr: Well, so it’s funny because I told you my partner was old school, right? So he was an older guy, gentlemen, he’s been in the business for 35 years. When I tell you he fought me tooth and nail every way with every contract, like oh, we could have got an extra$200 for that.
Teddy Slack Jr: It’s under concrete. I’m like, an extra$200. I brought in$35,000 in revenue last month. You know how much extra$200 we’d have to charge to get to that$35 grand. But after I showed him the numbers, I mean, he was an accountant too by trade, so before he got into the environmental business.
Teddy Slack Jr: And I broke, I mean, it took me months, but then I showed him, like, I’m like, we literally went at the time, I think we were at like$2 million in revenue, and almost overnight we were at$4 million, like within 12 months. We doubled the revenue.
Teddy Slack Jr: So he saw it and he’s like, all right, he stopped complaining, but yeah, he gave me a hard time. He did not want to do it because he had that problem. Like you said, he he’s like, I can’t comprehend it. And I learned this from reading.
Teddy Slack Jr: I don’t know what book I read, but somebody’s like, you know, flat rate pricing, you know, you know, you learn about this, your closing percentage, your customer acquisition costs, you start learning about all these things. You’re like, holy shit, now you can start tweaking your business like this.
Teddy Slack Jr: And it’s like you start thinking, like, well, how can I improve these numbers? And that’s what I did. I start really dialing in on the profit because the profit is what drives the value of the business. And ultimately, that’s what we were doing.
Teddy Slack Jr: We were growing the business to sell it. So I wanted to really just hammer down on the profitability of the business, you know.
Tyler Martin: So so my number one lesson here would be because you said it so well, is if someone’s having trouble fee getting comfortable about a flat fee pricing, I’d say the number one thing, and you said it, is look at the data. Have someone create data for you and show you the different scenarios, and the numbers don’t lie.
Teddy Slack Jr: Yes, 100%. It’s all data driven. And all the decisions I made were all data driven. I literally would not make a decision unless I had some kind of data to back it up. And then I needed to prove to my partner at the time, like, listen, look at this, look at these numbers.
Teddy Slack Jr: And then he would say, All right. But yet, if you’re just throwing stuff at the wall and you don’t have the data to back it up, it becomes hard to make those decisions because you know, you will lose money on this job, maybe.
Teddy Slack Jr: But again, overall, you look at it at the end, you’re like, oh, all right, my pro I mean, my seller’s discretionary earnings or EBITDA, however you want to call it, was 43% of revenue. I mean, that’s unheard of in home services. Yeah. I mean, and I wasn’t involved in the day-to-day.
Teddy Slack Jr: Like I was literally out of the day. I mean, it was crazy what I was able to accomplish in like a 36-month period, you know?
Tyler Martin: Because you answered one of my questions. I can tell you’re very revenue driven. I think that probably feeds you a little bit. Like that excites you. The problem is, you know, we all know that saying, you know, top line is vanity, revenue is sanity.
Tyler Martin: Or I mean, sorry, top line is sanity, bottom line is uh sanity. I’m saying that, I’m totally botching that, but you know what I mean. So we tend to not look at the bottom line, but you just said 43%, which is insane uh bottom line.
Tyler Martin: When you first started that flat fee pricing, did you have some loss?
22:28Give it 90 days before you judge a pricing change
Tyler Martin: Like, what if like the first one was a loss? Would you maybe have been like, hey, I’m not sure if this works, or did you have some bad data when it first started out and you just stuck with it? Or how did that play out initially?
Teddy Slack Jr: Yeah. So uh I actually wrote a book. It’s coming out in September, hopefully on Amazon. It’s called Profit Driven Growth. And it’s literally just about, you know, profit. And that’s the main thing you should be focusing on. Because yes, I was that guy that chased revenue top line, top line, top line.
Teddy Slack Jr: But I have clients right now. I have a guy that’s doing almost 60 million in top line revenue, and he can’t take a paycheck out of his business. So I don’t care about top line, I care about profit, and I really want to dial in on the profits.
Teddy Slack Jr: But yes, uh uh, what I did for me is I said, I need a 90-day plan. I want to see this over a 90-day period, and then I’m gonna look back at the data. So I’m not gonna look at one-off jobs, right? So, and and that’s what my my partner was doing.
Teddy Slack Jr: He’d go and be like, Well, we could have got 300 bucks for the permit. The town charge us$300. So we actually did this job for like 900 bucks. I’m like, okay, that’s fine. Let’s let’s look at it in 90 days. And then we did. And because my closing percentage went up, so in the in the tank business, yes, you’re in the oil tank business, right?
Teddy Slack Jr: So we had to remove oil tanks, but that’s not what we were there to do. Our real business was environmental cleanups. That’s where the jobs were, that’s where the profit is. So the tank removals were like loss leaders, right? You’re doing them just so you could find more tanks that are leaking, so you could have those cleanups, right?
Teddy Slack Jr: And I hate to say it because you don’t want anybody’s tank to leak. It’s a homeowner, you don’t want them to have to pay for that, but that’s where the money is in the business. The money is not in pulling oil tanks, the money is in the cleanups.
Teddy Slack Jr: So you want to, in order to find those cleanups, you have to pull more tanks. Well, how do you pull more tanks? You increase your closing cost, your closing percentage. And that’s what I did. So we went from 45% to 75%. So if I was sending out a hundred proposals a month at an average ticket of$3,000, I mean, you do start doing the math on that.
Teddy Slack Jr: I mean, it quickly your revenue goes through the roof, you know?
Tyler Martin: Yeah, but that’s gold. I don’t want to gloss over that. You because we we’re all guilty of this. We tend to look at result by result when we first start something, the first few, and we make decisions based off that. You had the presence of mind to go, no, I’m gonna look at a fair population of time, 90 days in this case, and then I’m gonna evaluate and either pivot, change, tweak, whatever it takes, but I’m gonna make my decision off a good amount of data.
Teddy Slack Jr: Yes, 100%. You have to. And then I do that even now and today. I mean, any kind of decision I make inside of a business, I always say, we let’s run it for 90 days or 30 days, depending on what it is. Yeah, whether that’s uh proposals.
Teddy Slack Jr: I mean, I tweak the proposals, I mean, down to the wording of the proposals, and then I’d run A B tests on the proposals, and I’d say, all right, well, let’s run these for 30 days, let’s see what has a better closing percentage.
Teddy Slack Jr: Because I get obsessed with all these little numbers, you know, and I’m like, proposal A closed at 75. This one closed at 65. Well, let’s scrap that one. We’re only going with proposal A. So yeah, you could I do that with every decision I make now in business.
Teddy Slack Jr: And I never did that before.
Tyler Martin: But we’re so emotional that, you know, myself included, and people, I’m sure a lot of people out in the audience, because I interact with a lot of business owners like this, we’re very emotional. We’re very uh just like the guy, the the your partner that you had.
Tyler Martin: We look at one by one and we forget that we need to evaluate, or we don’t know maybe even that we have to look at a population of data before we really make a decision. So I I love that. That’s gold. Yep, yeah.
Tyler Martin: Good stuff.
Teddy Slack Jr: It’s it’s helped me a lot in business is the to go and really dial in on the data. Yeah, without it, you can’t. I mean, I I did it for years, so I know what it’s like doing without it. And now that I’m obsessed with it, it makes a massive difference.
Tyler Martin: You’re like a covert finance person, I think. I think you’re like, I think you’re a finance person in hiding.
Teddy Slack Jr: Yes, I get that a lot, man. I I became obsessed with the numbers. When I started reading about building businesses for value purposes, I really came obsessed with how do I increase the profits and playing these little like I call them like games.
Teddy Slack Jr: It’s like a little game to me. It’s like, all right, if I tweet this proposal, if I do a price here and I change this pricing, I mean, I came up with all kinds of stuff. Like uh, we gave out a guaranteed uh soil test, which no one in the industry was doing.
Teddy Slack Jr: There was no expense associated with it, unless I got uh like so we would we go out and soil test your tank, and I would say, hey, for$1,400 additional, I’ll guarantee that if you pull it with my company. So now I got the removal guaranteed, which is another$1,400.
Teddy Slack Jr: I’m like, if you pull with us and there’s a leak, I’ll clean it up for free. Nobody was like, What? They’re like, we can’t do that. But again, I would pull 20 of them and maybe one of them would be a minor leak.
Teddy Slack Jr: And I so I again run the numbers, okay? So I sold 20 of them at 1400 a pop. The minor leak cost me three grand at my cost, you know. So it was worth it, you know, it made it made sense. So I start playing all those games.
Tyler Martin: You strew seem to me you’re pretty creative too. So you could not only do you have a finance background, it’s pretty unfinance ability, it’s pretty unusual for you your creativity in terms of how you price things. Have you had some ideas that haven’t panned out where you would have said you start to do it and you’re like, uh, I can tell this is going way in the wrong direction?
Teddy Slack Jr: Yeah, 100%. I mean, always you can’t, you’re not gonna be you’re not gonna have a hundred percent win win rate, right? So we we try to launch a in real insurance product where we would charge monthly, because again, learning about value, I’m like, oh, recurring revenue.
Teddy Slack Jr: I need to put recurring revenue in my business, you know? So I’m like, let’s do a thing where we charge the customers like 59 bucks a month, but it would shore their tank. So if they had an active oil tank and they didn’t want to sell it and they were still putting oil in it, which some houses are, right?
Teddy Slack Jr: Because they don’t have access to gas. Uh, so they’re still using the tank. So I would go out there and I would try to pitch them on it. And we sold a couple of them, but it just I could never get it to scale, really, because in order to really grow that, you had to partner with the oil providers and those guys, because there are competitors that do that, but you needed a lot of money to get it off the ground because you had to get in bed with a real insurance company and I couldn’t do it in-house.
Teddy Slack Jr: So that just kind of whizzled off, you know. We didn’t we didn’t really push it, you know.
Tyler Martin: Yeah, I love though that you you your creativity. I mean, it sounds like you really immersed yourself in the business, the numbers of the business, and thought of all these crazy ways. And I don’t want to say crazy ways, I shouldn’t say that.
Tyler Martin: Pain points, creative, yeah. It’s yeah, that you could evolve the business.
Teddy Slack Jr: Well, that’s exactly it. I mean, and that’s what I tell us a lot of my clients like, let’s think outside the box, like, think about the pain points of your customers, right? What what kind of pain points are they going through? How can you solve those pain points?
Teddy Slack Jr: And now you can charge for that. And you know, it’s not taking advantage because you are solving a problem that they have, and no one else is, especially if no one in the industry is offering it, it’s like mind-blowing what happens because it’s so easy to sign them on because they’re like, Oh, no one else is offering this.
Tyler Martin: Yeah. And what kind of breaks my heart a little bit, occasionally I’ll have someone come to me that let’s say they’re running a flooring business or whatever, and they’ll come to me and we’ll talk about what’s your strategy in terms of your marketing, how are you doing things, how are you presenting your services.
Tyler Martin: And I’ve had people say to me, Well, I just do flooring, dude. It’s it’s all the same. Like everybody does the same thing. Like it’s just, it’s just flooring. And I’m like, wait. And then they get in this whole discussion where no, there’s differentiators here.
Tyler Martin: And but people don’t always just intuitively see it. I think because we get so close to things of course of having doing the same thing. We just we have optics that just don’t see the big picture.
Teddy Slack Jr: Yes, 100%. That can happen for sure. Do you see that uh sometimes with business owners? Oh, yeah, all the time, all the time. And even trying to pull it out of them is something I feel like I have to pull it out of them.
Teddy Slack Jr: Like, no, come on, let’s think together here. Let’s really think about it. And you know, yeah, it’s uh it could be difficult. You get especially the guys that have been around for a long time, those are the ones that are hardest because you know, and I don’t blame them, right?
Teddy Slack Jr: They’ve been business for 30 years, they’re doing it one way and they’ve been successful. So trying to get them to change, uh, you know, I have a client right now that they want to sell, and I’m preparing them. I’m like, listen, this is what we need to do if you want to grow the value, and they’re just like having a hard time with it all.
Teddy Slack Jr: So, you know, it’s uh it can be difficult sometimes.
Tyler Martin: Yeah, it’s interesting. Hey, I want to switch gears here into the next segment. So I’ll give this uh up to your choice, but what’s either the best or the worst advice that you’ve seen in this industry, whether you’ve gotten it personally or you just see it?
Tyler Martin: And when you say this industry, do you mean oh sorry, home services, blue collar?
Teddy Slack Jr: Yeah. Well, the best advice By far, and I I tell this to all my clients, and this is one of the things that I didn’t do initially.
30:04Killing the $250 tank search to focus on three services
Teddy Slack Jr: And then once I did it, I it became very successful very quickly. It’s focus. It’s one word, it’s focused. I mean, and when I say focus, I mean I’m talking like hyper focus. Like you know, there’s so many companies I talk to now, contractors, that are like, well, I offer this service and I do this too, and this too, and this too.
Teddy Slack Jr: I’m like, whoa, I’m like, you can’t be good at all that stuff. Like, there’s just not possible. And if you when you really understand uh processes and you know systems and processes and you start breaking down, it’s it’s different and it’s unique for every service that you’re providing.
Teddy Slack Jr: So now you have multiple different, it’s it just complicates things. And when you hyper focus on one thing like I did with Simple Tank and I didn’t do anything else, I mean, I literally was just, I mean, I turned everything else off. It was just that business is when I was really able to scale it properly and build the value so quickly.
Tyler Martin: So, how do you do that? I mean, just from a practical standpoint, I it worked for you, but the shiny odd object syndrome is is is more than ever because of AI and so hard. You know, should I have AI attendance? Should I have this AI? Should I have that? How do you do it? Like, what what would be your advice?
Teddy Slack Jr: So, I mean, again, it for me, it’s like um when you start breaking it down by systems and when you’re you’re used to putting systems in place, which again, I never did that after first 15 years. But then when I start educating myself, I’m like, oh, this is how you do it.
Teddy Slack Jr: Okay. But when you start working on systems and you realize how complicated it is to like put systems together that are repeatable, that you can hand off to someone else, you’re not gonna want to have you know all these different you know, you’re gonna start looking at things like, okay, well, this is really like let’s focus on these systems.
Teddy Slack Jr: Let’s so we can hand them off to somebody. And then, you know, it’s just uh to be good at one thing, most companies are not doing that. So you’re gonna stand out, right? So, like I hyper focused, I actually got rid of a service.
Teddy Slack Jr: So we offered for the longest time, we did what’s called tank searches, right? So uh companies or realtors and buyers would call us and say, Hey, we’re not sure. I’m buying this house or I’m not sure it has an oil tank, and you come out and do a sweep.
Teddy Slack Jr: And we would charge 250 bucks for that service. So now we’re dealing with the buyer, the realtor, the buyer’s realtor, the seller’s realtor, sometimes the attorneys, sometimes the buyer, the seller at the other. I mean, we were dealing with six or seven people that were calling in our office constantly, where are you?
Teddy Slack Jr: When’s my report coming? Blah blah for 250 bucks. So when I started Simple Tank, we launched that. I was like, we’re getting rid of that service. And my partner’s like, we can’t get rid of that. I’ve been doing this for 35 years. We bring in 200 grand in revenue off of that.
Teddy Slack Jr: I was like, Yeah, and we get nothing all, we don’t get work out of it because we’re dealing with the buyer. And once we find an oil tank, the seller’s like, I’m gonna hire my own guy, I’m not hiring your guy, you know how that goes.
Teddy Slack Jr: So we would not get the big work. So I’m like, for 250 bucks, I’m like, if we hyper focus on tank removals and soil remediations and incorporate soil testing, which will find us more leakers, that’s where and that’s what we did. We hyper focus our marketing, all our efforts went into that, and we became the experts at tank removals, soil test, and soil remediations, three services, and we scaled it.
Teddy Slack Jr: Like I said, we were at a million six in profit in the first like I think uh 18 months.
Tyler Martin: Wow. So I was about to say it probably took you a certain amount of time to be able to target what you want to focus on and what you don’t want to focus on. But 18 months is not a lot of time for that level of growth.
Teddy Slack Jr: But you have to remember, I was in the industry for since 2005 full time. Okay, so I was in it at that point. So it wasn’t like it was a brand new industry for me. So I kind of already knew where to hyper focus on.
Teddy Slack Jr: And again, reading all the books, I’m like, all right, I got to really dial it and finding that service that’s the most profit. Some people think like this like, what is out of let’s say you’re you’re offering six services, which one is the most profit?
Teddy Slack Jr: Which one has the highest profit margin? Well, why don’t we concentrate on finding more of those, right? And let’s get rid of the low profit margin services so you have more time to deal with the higher profit margin jobs because that’s gonna open you up for giving better customer service.
Teddy Slack Jr: And if you’re giving better customer service, you’re gonna get more reviews. If you get more reviews, you get more customers. And it’s just a flywheel, right? And that’s what I did. And it and it worked really well.
Tyler Martin: Good stuff. How about before we wrap up this segment? Anything come to mind that kind of falls in the bad advice or the worst advice category for once again, like home service businesses or just blue-collar trades in general?
Teddy Slack Jr: Yeah, absolutely. Uh, it’s definitely revenue. Okay. Everybody’s everybody taught all they talk about. Oh, I did 10 million, I did 20 million. Like I said, I have a client right now who’s doing 60 million, he can’t take a paycheck. So revenue is not the target.
Teddy Slack Jr: Okay. Yeah, I mean, it’s it’s scary. I mean, I have a lot of clients that are even 8 million, 10 million, and they’re not even bringing home a half of the revenue or the profits that I was bringing home. And I was only at 4 million top line.
Teddy Slack Jr: So profit is where you need to concentrate on, again, concentrating on profit, uh, the profit drivers, what what services are the highest profit margins and really dialing that in? It doesn’t matter how much revenue you bring in. I know it sounds great, it sounds sexy.
Teddy Slack Jr: Yeah, I brought in 30 million, but you know, if you’re not making any money, what’s the point? We’re all this is when this is not charity, we’re not running charities here. We’re here, just the for-profit businesses. Why are we not talking about profit?
Teddy Slack Jr: And that’s what I think every company should be talking about.
Tyler Martin: What would you say when someone comes to you? Because I see something very similar to what you’re saying. Someone comes to you, you know,$8 million a year business and owners taking a nominal salary. I true story. Had someone come to me about two months ago, two guys, partners doing six million, you know what their W-2 was, and they’re taking no distributions?
Tyler Martin: $85k a year.
Teddy Slack Jr: Oh my God. That’s what I’m talking about. This is what I mean. It’s like, dude, like, I why would I even do that? Like, I mean, you know, go get a job at that point.
Tyler Martin: Exactly. And you, you know, even if you are only working 20 hours a week, maybe you’re tanking a little bit. It’s still not worth even the headache, in my opinion. So, what’s the first thing you look at when you hear a scenario like that?
Tyler Martin: All right, is it all about raising pricing? Is it about cutting expenses? Where does it fall in for you?
Teddy Slack Jr: So, a lot of times it’s pricing. That’s what I see with a lot of my clients. It’s they’re just not pricing right. Like they’re they’re they don’t understand gross profit, they don’t understand what their overhead is and what their target should be. So, yeah, they’re they they think they need to be competitive.
Teddy Slack Jr: So they’re dropping the prices to get the jobs. But I’m like, okay, yeah, you’re keeping your guys busy, but you’re not making any money. I mean, I just sat with a client. I’m like, yeah, you did, like you said, around six million. I’m like, you did all this money, but you’re less than like 5% in profit when you really look at everything.
Teddy Slack Jr: What are you doing? I wouldn’t even get a bet for this money. And yeah, so it’s pricing is a lot, but it’s not just, hey, raise your prices. It’s not always that. A lot of times it’s your processes, right? And streamlining certain things.
Teddy Slack Jr: I had a client, same, same size uh revenue, and they had a full-time bookkeeper in there, and they were paying them a lot of money. It was like 75,000. And they were like, Well, my booker’s been with me for 15 years. What do I do? I’m like, okay, well, let me sit with the bookkeeper and let me see what they’re doing every day.
Teddy Slack Jr: I want to know exactly. I mean, literally, I’ll break down by 15-minute increments what you’re doing, and then I’ll see if this she’s worth the money. And it wasn’t. I mean, what she was doing, I’m like, okay, we could outsource this, we could do this, we could have this person do this part of it.
Teddy Slack Jr: And now we just, and I hate to say it’s like, you know, people say, Oh, you’re firing people. You but listen, at the end of the day, this is business, right? Right. We’re in business to make money. If if the business goes down, everybody loses their job.
Teddy Slack Jr: Everybody’s out. Yeah. You know what I mean? So you can’t just look at it like, oh, you just want to fire everybody. No, it’s not about that. It’s about streamlining the processes, making the business profitable so everybody can continue to have a job, or the majority of the people can continue to have a job, you know?
Tyler Martin: Right. One thing I hear commonly, I’d love to know your opinion on this. So someone will come to me, and part of the reason their profits are so poor is they’re working with a type of business segment segment. So let’s say property managers and HVAC or a commercial business.
Tyler Martin: And it’s generally known to be low margin type business. And really, the the solution probably is to be more in a higher return business like residential. How would you deal with like what are your thoughts around changing business mix and how do you handle that type of conversation?
Teddy Slack Jr: Well, I have a client right now that’s literally going through this and we reworked, they do public bid work, right? So, as you know, public bid work, you gotta be real tight on your bids because otherwise you won’t win the work, right? So, and he was getting a lot of work, but he wasn’t profitable.
Teddy Slack Jr: And I said, listen, at the end of the day, and they have four divisions inside their company. And I said, Okay, at the end of the day, here’s here’s the target you have to shoot for. If you can’t win bids at this money, like at this profit target, like you have to decide because you have three other very profitable divisions, and you’re taking money out of the three profitable divisions to feed this division that’s losing money, it doesn’t make any sense.
Teddy Slack Jr: So here’s the new target, and that’s what they did. They start putting out the bids, and you know, they lost the first one, but then they got the second, the third one, and now they’re starting to come back and it’s starting to do really well.
Teddy Slack Jr: But it’s crazy because the guy that I sat with, he was the estimator for this business. And now you would think he’s the estimator, right? He’s working with numbers all day long. I asked him to show me what the profits were. He came and he showed me the gross profits.
Teddy Slack Jr: I’m like, it didn’t have uh overhead. I’m like, do you know this is gross profit, right? Do you know the difference between gross profit and profit and net profit? He was like, Well, I just thought that’s what the company keeps. I’m like, yeah, it keeps that, but then it’s got to pay all the bills.
Teddy Slack Jr: I’m like, so that’s not what’s left over, you know what I mean? So so I deal with that all the time. And yeah, sometimes it makes sense to just cut it, cut it loose if you have to and go in the direction where the where the highest profit margins are, you know?
Tyler Martin: Yeah, that’s good feedback. That’s great. Okay, as usual, I’m not doing a great job of managing time, and I’ve got uh my favorite topic I want to be sure to cover. Let’s talk a little bit about like your blueprint, is what I call it.
Tyler Martin: In terms of we’ve talked a little bit about numbers, but in terms of KPIs, dashboards, things that would keep the team and the company aligned. What are you looking at? And what do you feel are the most critical things that, and I realize this might vary between companies and industries, but generally speaking?
Teddy Slack Jr: Yeah, generally speaking, I mean, in my last business, um, the main things that we looked at is we looked at, you know, how many estimates were we giving, you know, how many phone calls? We start with that. So, how many phone calls are coming in, how many leads were coming in?
Teddy Slack Jr: Out of those leads, how many were turning into proposals? Out of those proposals, how many were closing? So, our closing percentage. The closing percentage is very important because you want to tweak that. If it’s not a good closing percentage, you want to work on your sales process to increase that.
Teddy Slack Jr: Uh, so closing percentage is huge, your customer acquisition cost is really big. You want to know what it costs to acquire a customer because if you know your customer acquisition cost, now you can figure out ways where you could acquire customers for maybe cheaper, you know, through maybe referral partners.
Teddy Slack Jr: There’s a lot of different ways you could uh, you know, acquire a customer. So yeah, I mean the profit margins, obviously, you’re looking at profit margins, but you know, as far as uh like marketing goes, it’s it’s those things essentially leads and closing percentage and customer acquisition costs.
40:003% marketing spend and the new roofing business
Tyler Martin: Do you have a dollar amount of uh, or not dollar amount, I’m sorry, a percentage of your marketing budget as a percentage of revenue that generally people should, businesses should be in?
Teddy Slack Jr: Yeah. So and this varies. Now, the way I did my marketing, so marketing is one of the things I really love. So I I am I call myself like a general contractor of marketing because I can go and and find the, I call them the killers that they’re like, you know, specialists in what they do.
Teddy Slack Jr: Like I had one guy for on-page SEO, one guy for off-page SEO, one guy for my backlinks, and I hired all these freelancers essentially. I mean, I had probably 20 guys working in my marketing department, but they’re all outsourced, you know, and I manage those teams.
Teddy Slack Jr: So what my marketing spend, when we were growing from year over year, 100%, I was at 3% of revenue, which is very unheard of. But again, this goes back to the 43%, you know, even uh, I was able to keep that profit margin really high.
Teddy Slack Jr: Typically, though, most companies that are hiring are outsourcing to companies that are doing their marketing and doing their SEO and stuff like that, anywhere between five to 10%, depending on how much they want to grow, is is usually a good number that I like to see.
Tyler Martin: Okay, good. Okay, yeah, that’s that’s pretty common. Three percent, considering your bottom line is pretty amazing. That’s crazy, man. You you’re doing a heck of a job closing, and your cost acquisition must have been like nothing practically.
Teddy Slack Jr: Yes, it was very low. I mean, our cost of acquisition was very low. I mean, our average ticket was 3,000. I think our cost of acquisition was about 50 bucks. And you know, but I did a lot of things that were outside of the norm.
Teddy Slack Jr: I mean, I had a podcast in the oil tank industry, which who the hell hasn’t a podcast in the oil tank industry, right? So I had that. I had a YouTube channel that I scaled that that drove, I mean, the customers were like, I learned so much from your YouTube channel that I just I don’t care.
Teddy Slack Jr: I want to hire the guy with the beard, they would tell me. You know, it was me at the time. And I’m like, all right, yeah, let’s go. And my closing percentage went through the roof. So a lot of things like that, which helped, you know.
Tyler Martin: Which, oh, by the way, there’s your branding of the guy with the beard. Uh, whether that was organically happening or not, that’s cool that people recognize you that way. That’s awesome. Hey, okay. I think we’ve talked good about, I think we’ve covered a fair ground on the numbers.
Tyler Martin: I want to go into the last thing, and that’s just kind of like the next summit, I call it. Like, where are you going? What are your next steps? What’s big for you and happening on the horizon?
Teddy Slack Jr: Yeah. So uh I’ve been doing some coaching and consulting, like I said, uh since I sold my business. And uh I like it. I mean, I do. I really do like it. I like helping other people. Um, but my passion is uh what I’ve really found in the last couple of months here is I really get like excited to grow something from nothing, right?
Teddy Slack Jr: So taking something from zero and seeing it like a baby just grow. And uh so I’m actually entertaining. Well, I I really did pull the trigger this week, actually, just this week, where I am starting a residential roofing business in New Jersey. So I see a major opportunity in the roofing space.
Teddy Slack Jr: I’m really interested in this space because of the way that it operates. I have a lot to learn, obviously, because I don’t come from that industry, but I’ve done some consulting in the space uh and now I’m starting to learn. And I’m bringing on coaches, I’m bringing on people that are going to help me through that, the industry knowledge aspect of it.
Teddy Slack Jr: But as far as the business aspect, the marketing, the operation, the sales, I feel like I bring a lot to the table in the space. And uh yeah, I’m looking to partner with companies. That’s what I did my last business too. I did a mini roll-up in the tank business.
Teddy Slack Jr: So I’ll be looking to do that as well and with some of the small guys in the roofing space to kind of just take it and grow and see where it goes.
Tyler Martin: So you envision kind of acquiring some small roof or so to speak. Would that be to acquire talent that way? Or would it be what would be the reasoning behind it?
Teddy Slack Jr: Exactly. Yep, it’s acquiring talent, uh, it’s acquiring, you know, uh phone numbers that, you know, people like I a lot of times I just sat with a guy, he’s doing five and a half million top line. He does zero marketing, zero. He just hasn’t, he’s been doing it forever and it’s all referral-based.
Teddy Slack Jr: So for a guy like me, where I’m coming in, I’m doing all PPC, LSA and Google Business Page, you know, optimization, I’m doing all that stuff, right? YouTube, I bring a guy like that on my team. Now it’s like fireworks because I got the referral work coming in, plus I got the digital marketing aspect working together.
Teddy Slack Jr: And it’s like, boom, we go to the next level really fast, you know.
Tyler Martin: When you look at projections or some type of forecasting, what do you anticipate in terms of like your first year? Do you already have like you do you think you’ll be a seven-figure company in your first year? Or how do you how do you model that out in terms of expectation?
Teddy Slack Jr: I mean, the way it’s back of the napkin math for me, essentially, uh, you know, average ticket in the roofing business in New Jersey is about 20,000. So, you know, even at with one crew, with one project manager, I could probably do anywhere between 3.6 to 4 million in the first year is kind of what I’m projecting.
Teddy Slack Jr: Yeah.
Tyler Martin: That’s crazy. And you’re you’re obviously coming from a standpoint now where you’ve had several successful businesses. I imagine you probably have a little bit of capital. So you can invest. I would think you’re able to shorten the curve a little bit here, even be just because you are in a stronger position than maybe other times that you’ve started businesses.
Teddy Slack Jr: Yeah, exactly. Every time I’ve started a business before, I mean, in the first business I started after I was my family business, I started, I had$8,000 in my pocket. I mean, that’s how it had to my name because I was 20 years old.
Teddy Slack Jr: I wasn’t making a lot of money at the time, but I was, you know, young kids. I spent it on everything cars, houses, women, everything, you know, 20 years old and you’re making decent money. That’s what you tend to do. But now, yeah, I’m in a different financial position, but I am gonna still take that same mindset of bootstrapping because uh, you know, I’m not just gonna dump a couple hundred grand into an account and say, yeah, let’s run with this.
Teddy Slack Jr: So I’m gonna start slow. I’m actually gonna record a lot of it on my YouTube channel, documenting the process of uh, you know, doing this bootstrapping in in the residential roofing business. So it should be fun. It’s gonna, I’m gonna have a videographer full time from day one.
Teddy Slack Jr: That’s one of the things I’m bringing on board. But yeah, I’m gonna do I’m doing professional branding right off the rip. Um, you know, I’m gonna spend some money there. And uh yeah, I’m gonna do it right, you know, right out the gate this time, you know.
Tyler Martin: Yeah, you’re investing. Yeah, that’s cool. Is this documentary? Would you envision that’ll be part of Teddy Slack YouTube or is that a new channel?
Teddy Slack Jr: Okay, yeah, it’ll be under my personal account. And then, you know, I’ll start a separate account for the actual roofing business where I’ll do more like educational content for the for the homeowners to drive lead generation, hopefully.
Tyler Martin: Yeah, okay, got it. Awesome. What about biz score.ai? Is that got a life or where does that sit in your product line?
Teddy Slack Jr: Yeah, so it’s a tool that I created that was it helps with my current clients. So if I have a client, I sit with them, I go through their PL, I go through their balance sheet. And essentially what it does is it just analyzes their business from uh, you know, financial standpoint, but also on uh how involved they are in the day-to-day and it gives them a grade, right?
Teddy Slack Jr: That’s how it works. So it’ll give them a grade from zero to 10, it’ll tell them where they’re at, and it’ll make some uh recommendations on how to improve. And then we have a starting point to say, okay, well, if you want to be out of the day-to-day and you want to improve the value of your business and we want to increase the profit margins and stuff, let’s start working on these things.
Teddy Slack Jr: And it kind of gives us a starting point. And that’s how I’ve helped some of my clients with uh coaching them through uh, you know, growing their companies and stuff.
Tyler Martin: So very cool that you made a tool like that. I like that it kind of takes complex things and it sounds like it synthesizes it into an easier to understand way. Yes, yep. Yeah, very cool. Okay. Hey, man. So uh just as we wrap up here, a few things I want to summarize on.
Tyler Martin: So I would say one of my big takeaways, I would say easy one is know your numbers. I think you’ve been really good about knowing your numbers, being aggressive in terms of uh not being afraid to change the industry you’re in and test things and look at an adequate amount of data before you make changes.
Tyler Martin: So I’d say that’s one big takeaway for me. Another big takeaway, although we didn’t get too deep into it, was make making sure that you systemize your business. Yes. I think that’s one thing that tends to get glossed over a lot. Would you say anything else come to mind to you for as far as a takeaway that the audience might be able to take and apply to their own businesses?
Teddy Slack Jr: Yes. I mean, systematizing, I mean, we just hit on that because you brought it up. I mean, uh, that’s already something I’m doing for the roofing business. I didn’t even start the business yet, but I already started putting together systems. Like I have uh I have an executive assistant that helps me with some of the stuff that I do.
Teddy Slack Jr: And I’m constantly putting systems in place so I could hand things off, right? So you got to start doing that at any stage of the game you’re at, but I believe that’s something you got to start working on right away. And it’s not hard to do, you know.
Teddy Slack Jr: You just evaluate your time and you start handing off the things that you hate doing the most, you know, and uh it changes it changed my life when I learned about that and uh, you know, made running a business a lot more enjoyable.
Tyler Martin: Yeah. And then I think number three I might end on, although this was a very small part of the show, is family businesses are tough. And I’d say understand that they’re tough. Just like business, there’s ups and downs. And I think the best job you can do to try to keep relationships aligned in a family business.
Tyler Martin: I think I see those relationships last longer. I think when there’s a lack of clear leadership or what the hierarchy is, I feel like a lot of times is where you see just it’s chaos. Yes. Anything else you would add to that?
Teddy Slack Jr: Yeah, no, a hundred percent. I mean, that was the issue. There was um, you know, it was my father’s business and I was working for him and and I started the division. So that’s kind of where it became an issue because it wasn’t like I was I was an employee, but like it wasn’t like I just went there and he gave me a job.
Teddy Slack Jr: It wasn’t like, oh, go do sales for my business. He’s like, here’s a yellow pad and a desk and a pen and a phone. What see what you could do with it. That’s literally what he told me. And I started, you know, this division that morphed into this big business or decent sized business.
Teddy Slack Jr: And uh I I think that’s what made it tough because it felt like my business, but it wasn’t. It was still my father’s business in the day. And you know, it was a young kid, so it it was hard. It was definitely hard.
Tyler Martin: Yeah, good stuff. Okay, Teddy. So these are your websites. You’ve got a LinkedIn profile at Teddy Slack. That’s where you do, I believe, a lot of interaction there. People can reach out to you. You’ve got Instagram is is now teddy underscore slack. And then, of course, you have bizscore.ai, b-i-z score.ai.
Tyler Martin: Anything I left out or anything else you want to talk about?
Teddy Slack Jr: No, just the YouTube channel, which uh that’s at Teddy Slack as well. There’s some some content out there. And like I said, I’ll be hopefully putting together a documentary on on bootstrapping this roofing business and putting out some good content on there.
Tyler Martin: Yeah, I’m excited to hear that. In fact, on the note of your YouTube, that’s how I actually initially learned about you and we connected. Uh, your YouTube videos are awesome, dude. I mean, you thank you. You’re a great presenter, very thorough. You talk about numbers.
Tyler Martin: One other thing as I wrap up here, are there any books for you that stand out? Because you mentioned reading a lot of books, any that maybe the audience would enjoy checking out and being sure they should be on their reading list.
Teddy Slack Jr: Yeah, I mean, so it depends on you know what what topics you want to cover. I mean, for numbers, uh Simple Numbers by Greg Crabtree. Yeah, I I like that book. It simplified a lot of uh things for me, understanding of uh your numbers and your business.
Teddy Slack Jr: And uh Built to Sell by John Warlow is a very good business as well. Uh very good book, excuse me, on uh growing your business for value purposes and how to prepare for a sale. So it’s a great, great book.
Tyler Martin: Yeah, those are two great, great books. In fact, John has his own podcast. Yes. I’m surprised you haven’t. If you haven’t been on that, I’d be surprised because you you have a great story.
Teddy Slack Jr: Yeah, I appreciate it. I appreciate it. It was nice being on here, Tyler. I appreciate you having me on for sure.
Tyler Martin: Yeah, you’re amazing, Teddy. Thanks a lot. I appreciate it too. Take care. All right, take it easy. So there’s a lot to love about this episode. And what what I think I liked probably the most is Teddy’s story, and that it proves systems aren’t optional.
Tyler Martin: They’re really survival. And when you’re in the trades, chaos will eat profits faster than you can believe if you don’t have those guardrails in place. And I also really liked his fixed pricing. He was willing to take a risk, he had a strategy, he gave it time to grow.
Tyler Martin: And that bold move, which was grounded in discipline, transformed his whole business. So, look, hey, if you’re a business owner, and I imagine you are if you’re listening to the show and you’re wrestling with your numbers, I’d love to be there to help you.
Tyler Martin: I’d love to be part of your journey and get some real understanding and awareness to your numbers. Go ahead and visit CFOMadeEasy.com or CFO intro call. You can book a no pressure intro meeting. It’s just a chance for us to chat, see if possibly I can help you.
Tyler Martin: And last but not least, if you wouldn’t mind uh subscribing to Profit and Gret, you always get a notice in whatever platform you happen to listen to episode and get a notice that there’s a new episode out. Thank you as always for listening.
Tyler Martin: Thank you for being here and have a great rest of the week.
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Tyler Martin works with owners on the numbers behind these stories: business coaching for home-service owners.
