You can get away on small jobs, not having the best processes and procedures on bigger scale jobs. You have to define them. You have to really get into the weeds. We say you don't need trust if you have a process, so then you can trust the process. Welcome to Masters of Home Service, a podcast by Jobber. Each week we talk to successful home service entrepreneurs and experts in their field to learn how they built their company so we can make your business more profitable and more efficient.
We are in Las Vegas at Blue Wire Studios and today we're talking about how to win large profitable contracts. With me today is Dan Guest owner of Guest Plumbing, plumbing and hvac. Is that right? And HVAC now? Yep. Okay, and Judith Rag, the owner of, sorry, clean Club Calgary. Welcome to the show both of you guys. Thanks for having us on. Alright, so what is a big contract? Is it a recurring job over the course of several months? A years? Is it one big,
huge HVAC system? What exactly is a large contract? For us, it depends on the size of the scale of the job, but I think a large contract can be one. It can be a big dollar value contract or it could be a big client for a long period of time. And I think the difference between both of those is very important. Sometimes for our industry specifically, we do some big scale projects where you're doing say a six story building,
a big scale project for that. You want to look at, do we have the capacity to grow into a project like this, and once we're complete it, can we do it again? So building that for us, we like building maybe a smaller scale job but for a long-term relationship, so that way those marketing dollars go a lot longer. I totally agree. It's the same for us. It can be anybody that you're networking with and then you can find some people that give you small jobs.
My motto is kind of small jobs sometimes lead to big ones, right? Definitely finding those type of contracts that you can staff you're confident with and sometimes it's even outside your confidence zone because that's what's going to make you grow. Growth is always outside of your comfort zone. Our. Large contracts always profitable. For me. Yes, because trying to find that relationship that
works. Usually you get a customer, you work with them again, and if they're not your customer, you just kind of let them go. So if they're not profitable, then you just let them go. You have to have the confidence to do that when you're working in the big game. For us, it's a totally different answer. The big numbers get exciting and a lot of people, they get overzealous and people have swings, especially when you're negotiating a contract.
Say you're doing something for over a hundred thousand dollars and someone asks you, well, can you knock five points off? That's a couple thousand dollars. That's a lot. So what we talk about is how well is the job managed is usually how well the job is at profit time, but also you can estimate improperly, and so if you don't have a system for estimating,
it took us years to create that system. A lot of that is trial and error, but also trial by fire, which is you get on a job, it's over a hundred thousand dollars, there's sometimes multiple a hundred thousand dollars and you can't track it.
That's why job are so great, be able to time track and material track with POS and certain things like that to make sure that as you're going along the job, you're not waiting until the end to find out that you've lost kind of make it up as you go because you're on site for a lot longer. Yeah, I do think there's shiny object syndrome with big contracts.
A lot of our listeners are residential and they're on the smaller high volume or something like that, mowing or something like that, but a big contract comes up, it's like, oh my gosh, of course I'll make money. And they don't realize that actually you may not make any money if you do this wrong. There's higher stakes with big contracts. I'm curious for you guys, did you start out small or day one you were going after the big contracts? How was your company set up for that?
We started out small and we were actually kind of referred into a bigger contract when we were referred into it. I took the approach, it's like, can we do this? Do I have the manpower? It was from residential to commercial, so residential and commercial cleaning is very, very different. So I actually had to educate myself, but I just kind of went along with it and then now we have quite a few bigger contracts. It seems like the marketing's different, right?
I mean how is your marketing different when you're trying to land a large contract versus you're run in the mill, the contracts you get basically every day? How is it different? We call it the white van syndrome. So our vans are big, white, big blue leaf all over them, very well branded. We always say once you see us once you're going to see us every day, which is awesome. But on the big contracts, you go to those big sites, a lot of people are driving themselves in their own cars.
Branding's not as important, so it's a big transition as well. Sometimes there's subcontract labor on site, so in Canada we call it bid spec work. So there's bids that go out for tender, lowest bid gets the job to the lowest bid that on the contractors they don't care how well your marketing or branding works into play. Where as a residential company showing up in the right attire with a nice clean van goes a long way, right?
Really showcases how your work's going to be prior to starting the job. So they don't care about the brand as much, what do they care about? What does really matter to a decision maker in that space? I. Think at scale people want the job done correctly. Again, building those relationships and we go back to building relationships, but it's so much more than just a relationship.
We're talking about how just because you know them or you've gotten to know them, what's the mindset of their business trajectory? Are they looking to grow, expand, say you get into a commercial project or even a custom residential project, are they going to buy the house to sell it? Are they going to move into it? Is it the forever home? What are they going to do with the home?
And that's how we find we can build those relationships because you're asking some deeper questions instead of, I know you need a plumber, an HVAC technician, we know you're building a house. How do we connect so that I can get this job so I can just put a price together and so can everybody else. That's not really a relationship, that's just me trying to get work.
A lot of my business friendships have become friendships and we always say, so if I took business out of it, would we still be friends? And that's always, that's a good test. It's an interesting question to say, have I built a relationship with this person or have I really just gotten a job? And I think for a lot of small business owners, it's so much easier to work with people that you enjoy and that you like to spend time with and that like to problem solve together.
So if you're constantly having to go out and find new clients instead of nurturing the ones that you have, which is building the relationships by finding out the needs of that client specifically, that's really a game changer for us. I think that really changes your strategy when you're going into meeting someone. Yeah, I absolutely agree. Relationships is everything when it comes to commercial work.
And the way how we do that is it's almost like, you know how you're dating somebody and then you guys go out and then you got the person, but then you get married and then you think you have to do nothing anymore because hey, we're married. Right? That's not the case. You actually always have to court your hire bigger customers.
What we do is we are on site once a month. We check the work, we communicate with the client what we checked, we asked them if there's anything more they want, anything less they want, is everything jiving? I think it's so important to keep those lines of communication open, just making sure that the contract is going well. Yeah, I think a lot of our listeners would like to do some bigger jobs and get their
feet wet with that. I also, I just think in a lot of industries it's a totally different business model because on one hand if you're doing mow and blow landscaping, it's a lot of high volume, it's very transactional. The relationship matters some, but it's more you're really counting on your reputation as a company and that stands when it's more transactional.
But the bigger you get in terms of the size of contracts you're getting, it goes from transactional to relational and then you have to feed those relationships over time or else you'll lose them to somebody else who's being relational too. So would you say that larger contracts in general is more competitive or less competitive? Absolutely. That's a hard question. Yeah, I love what you said there. There's profit in all these areas and they are different business models.
In our industry, they call 'em the trunk slammers, but they're in there, they've spent a high marketing dollar to get that call. They've got a sales person right at your door, I would say more aggressively attacking you to sign now. Sign now. And if the experience isn't great, they don't care. They've got furnace or that a CN or the heat pump and they're not worried about it later or they've been purchased by a private equity firm and they don't matter.
Whereas the competition in building that relationship for the long period of time makes a lot more sense. So there's money wherever the business is set up for. Again, those commercial companies that are set up, usually they don't brand as much. Why? Because there's no ROI For them, they've got to be lowest bid, which means they got to keep their prices down. So to get those jobs, they actually can't spend too much money on branding and vehicles and stuff like
that. So I think there's money wherever you focus, we get it all the time. You should get into residential, you should get into commercial. It's like just focus on something and make it better and do great work. Focus is must. Yeah, you need to know what you want to do. And learning to say no, that's critical, especially for any smaller company. The first no feels like you've made a huge mistake. I remember mine, but it's always the best decision.
And then you can feed off of that and you can read the situation and see if you want to get into that because it is a big undertaking. And building on relationships is communication. On these bigger jobs, there can be so many touch points or you can really lose that communication. We find ensuring that, especially if you're growing to a size where you start having managers, well, the owner made the relationship, now the manager's got to manage it.
If that's not working out well, you're going to cross paths, which is never good. So having that proper handoff on those bigger jobs, I'm sure it goes a long way. What are some other complexities in setting up the contract and then keeping it going and keeping it good and strong? What are some other things that our listeners should know about?
Well, when you do bigger contract, you should definitely have a lawyer because I don't know if you guys review some of these contracts, but you don't want to be taken to the cleaners literally. And then also I think a lot of people don't realize when they get into the big game, they have to have their financing in place.
They have to have a good relationship with their banker, they have to have line of credits and whatnot because residential versus commercial, commercial is not going to pay sometimes 30, 60 or even 90 days. So you need to make sure that you can pay your team. So these are some of my things that have to be in place for sure. You hit it on the head there. Yeah.
Yeah. I mean you get used to as residential, you get used to just the weekly pay of your customers and then it's like it's commercial time. And then if you don't have that steady income on the residential side, then there isn't a bridge long enough to get you from the residential income to these big wait times for the contract to come through. So that's a good point. Let's take a minute to talk about jobber and all the reasons that we like it so much. That's why we're here.
Someone is out there listening who doesn't think they can afford jobber. Oh, I'm too small for jobber, I can't afford it. What would you say to them? We. Always say don't wait until you get too big. It's so hard to implement after the fact. If you can do it before, a lot of friends in the industry, again, these associations, you got to 'em in early. You're one person, you're two people. It's great. You can be user friendly and then you as the owner can train the rest of the
team. It's the best. We're so happy we were early adopters. Yeah, I've been using jobber since 2015. The thing that I say to those people, actually, if you want to do it the hard way, do it the hard way, that's fine by me. But also I started out residential, so I have both residential and commercial side of it. So what I always say to them, it's like, okay, so you charge 120 bucks for one clean, it's just maybe going to be one clean out of the month,
how many cleans you have. So that's how we get around the pricing. And I'm a huge believer in systems. I actually go and train other people who have signed up with jobber, just kind of show them how I run it. I am not shy about it at all. Jobber for us is fantastic. So I always tell them, if you want to grow the growth mindset, this is for you. Yeah, jobber is a time saving platform. So if our listeners want to save their time and not just waste all their time,
they need jobber big time. Absolutely. If you want to give jobber a try, then go to jobber.com/podcast deal, get an exclusive discount and save time. Build your business from day one the right way. Going back to relationships, we talked about how it goes some kind of transactional relationship. What are some tips for our listeners to start building those relationships with commercial contacts and whatnot? Find out about what their interests are. You go back to dating.
I always start with who their kids are, what their kids' names are. Remember them, find out what their interests are outside of it, and then if you can get into adding value and by adding value as to understand where they lack value, we've been very fortunate to use jobber and share that with others and have them be able to ask us questions on how our business enhanced.
Because as much as it's job to job, it's business owner to business owner or manager to business owner, whoever you're kind of going after, I find that if you can make that relationship grow by relating, I always say, this is me relating, but okay, we're having the same business struggles. Who's your accountant? Have you got a new lawyer? What are you guys doing for marketing? We get it all the time because we were an early adopter to being an online presence with Instagram and stuff like that
six, seven years ago. At first we got made fun of. That was challenging. And then when you roll it through now people are like, wow, this company's doing great. How do we do more like that? But they might be embarrassed to ask. So opening that conversation, I find instead of talking about what their business is but how their business operates, I find it's a great entry into kind of a deep dive, but also understanding where their pain points are because they usually become yours.
I've had some great success gravitating people into our city organizations. So we have a builders association, we have chambers of commerce in Canada, and creating a community within that and having everybody grab the benefits has been awesome. That's a big one that I don't think people want to talk about. They're scared to ask how their business is doing, but I find if you lead with you could say openness or vulnerability, just be like, Hey, you know what? I'm struggling this month.
I'm looking for a new accountant. Who do you use? Might not actually be the case. Those are great questions. I like those. Yeah, it's really like it's eyeopening and when you can get into, again, it's like get past the surface. I always say lead with vulnerability and then you get vulnerability back and then that's what you kind of strengths for relationship.
Does the owner have to do this part or do you use salespeople who's going in there and really closing the deal, building relationships and then actually making the deal happen? Is that just the owner's job or can other people do it? Right now? I do it eventually. If we were to grow, then I would give it out to somebody else. But also something that I learned really early on when I started my business is people buy you. They don't buy your business, they buy you.
So just how you, we talked about trucks that they're not really important on the site. A little bit disagree with that because I think how you show up professionally is super important, even if you're on a big job. As you scale. We're 40 staff now, so I used to know every contract, I used to know every job, every job site, every address, because I'd been there, I'd met the person or the homeowner, the contractor, and you kind of go from that. As we've scaled, we have two locations now,
two different cities. Empowering your team is the most, it's such a rewarding thing to do. As you do that though, you have to instill what your core values are to them. So having a focus core values is really important, but also having everybody aligned with them. So whether you can communicate those or if that means someone's got to shadow you for a long time. We have a couple. We do it by mantras.
So when you're on the phone with somebody or giving somebody calls, it is now a good time to talk. So we have a couple of those that I've covered. Love that one. So there's a couple of those that we instill in our team and it kind of flows down, but also sometimes you think you're the only one that can do it until you watch somebody else do it better.
And so letting your team be their own individual is really critical and letting them spread their wings, bring their relationships into our business. Incredible. We have six sales teams now, which they manage their own crews and their own people, and they're bringing in jobs. I don't know where the guys are. What I'm worried and busy doing is building the business and creating those opportunities for the next team. So I think at first a hundred percent you're the person on the ground.
Everybody wants to see you. I find it's very interesting when someone's choosing a name. I usually don't recommend first name, last name company. It's not Dan Guest Plumbing. And I wouldn't use my mom's maiden name, which is Eisenberg Plumbing, but guests ended up working out pretty good. But yeah, having the team kind of, we say bleed blue, so having everybody on the same page. Would you guys recommend someone who's starting a business right off the rip?
Should they always follow the progression of residential, commercial and then bigger contracts or can you start a company right off the rip for just big contracts? What do you guys think? I think we talked about focus and that's where this comes in. So you really have to hone in that what you want to do and do your research. Residential versus commercial is super different. Less hassle seems to be in commercial.
Sometimes it's easier to hire people for commercial, but there is a really big market in residential too, so you just have to figure out for yourself. And there's a lot of things like marketing not as hard in commercial because you literally, as we talked about before, have to have maybe one big contract that gives you work constantly or a lot of maybe five or six bigger
contracts. So yeah, finding out what you want to do and being really, really strict about it, focused about it. What's going to take you the long way? I think. People ask me all the time because I have a lawn care business in my gutter business too, but with lawn care especially, I think there's this, what is it?
People assume that I'm still in the minor leagues with my residential lawn care business and that eventually when I get big enough and smart enough and strong enough, I'll go full commercial and then I'll be a real business. And I think that's ridiculous. Obviously. I think we all agree that's ridiculous. Absolutely. But people who are on the outside don't know that.
And I'm probably projecting a little bit on them because the barrier of entry with residential is lower, and so more people are in it generally speaking. And then there's idea that you'll graduate to commercial work eventually. What do you guys think about that? I think it's again, learning to say no, we are getting it all the time. We just moved into a massive market where there's tons of opportunity to grow and get big quick and understanding what your focus is.
We focus in residential, small, commercial, custom homes, installing service. That is a core value. That's our mantra. That's what we do. If it's outside of that. Then it's a. Couple opportunities where I have a great relationship with somebody and they want me to do something outside of that. I can say yes to those opportunities. We're doing a six story building at the moment that's outside our wheelhouse, but it's a client that I know we're able to do it.
We did all the proper measures. So you're not just saying yes drastically. It's calculated. I mean, you also, you want to stretch and grow as well. Of course. So there are opportunities like that to seize that allow you to grow in a controlled environment. We always say, what if you spent that extra shiny object energy on the dull boring stuff? How much better would you get?
How much further ahead would you get if you were able to spend, yeah, that new business idea sounds great, or that new division sounds awesome. What if we just focus that energy on that old division and it's like, oh yeah, that sounds right. But it's like, yeah, put in a couple extra hours, go in on Saturday, do some paperwork on Sunday. Just do it for what you're currently doing. And it's magical what comes up.
And if I can maybe add to that, that if you decide to get into any type of business and you do a business plan and you stick to it, I think that's your guiding light as to what you want to do. Do you want to do this? Do you want to do that? I mean, we go clean houses. We don't shovel snow. It's a given.
I made a mistake early on in the first five years, my business where I started off residential, and then I would get the calls from the local restaurant or whatever, the hotel and I'd be like, oh yeah, this is it. This is my chance to shine. And what I did was I stood over a line. I had one foot in residential and one foot in commercial, which means I didn't have a foot in either one. And my crews were spread too thin. They didn't know what we were doing.
They were confused on what our purpose and our goal was. There's just too much confusion. And what I made the mistake of thinking was, oh, it's all grass. You just cut it. It's not all grass. It's not all the same in any industry. It's very different. And so I think because I have a buddy who started off in commercial landscaping,
that's all he does from day one. And that's what he knew. And I think, and I've gotten back to where I'm focused now, but for a while I was trying to do both, and I actually think that's the worst case scenario until you're developed into a very, very stable, big enough company to do both. But in those early years, sub 1 million, I think you should do one or the other. It's. Always very much enticing when somebody big contacts you, right? Isn't it?
It's exciting. Yeah. It's exciting. Yeah, it's exciting. And then you want to go with the flow and everything. You just always have to bring it back to your core values as you had mentioned, and you just have to bring it back. Is this something that's in my business plan? Is this something that I want to do? Right? Yeah. I think too, I would've painted your fence if you called me in my first couple years,
it wouldn't have mattered. I find for anyone listening out there, if you can get past having to go through the pain, just listen. But saying no is critical. But you couldn't have told me. No. You couldn't have told me no. When we started our business and I was really getting after it, I would take on a big job, small job. What if the next job doesn't come? The fear that was going through my mind all the time, it would go and my managers are going to laugh and they hear this,
but they're going to go so scared. What are we going to do? We have too much work. Oh my God, we don't have enough work. What are we going to do? Oh my God, we don't have do any work. And it's that vicious cycle that just never stops, right? And being able to kind of just like, whoa, listen, it's always worked out. And we walked into a job site the other day. We were fixing an issue with the design of the build. I went up there,
gotb in there with a smile. Not that I didn't have a sense of urgency, but I said, there's no problem I haven't fixed yet. Sometimes it costs money, but there's always a solution. So if you can go in with that mindset, I think you can make work a lot more fun. Oh yeah, I totally agree with you. And we have the same thing all the time. Exactly. Too many employees, not too much work, blah, blah, blah. Doing the very best that you can with what you have, but keeping your focus.
Yeah. I want to close up and wrap it up. I have one more topic I want you guys to talk on as you guys close out. No, that is this I is the operational differences. Are there anything that our listeners should know about in terms of operations that are very different between one or the other, between residential and large contracts as we close out? You guys have any final thoughts on that in terms of the differences between getting the job done, planning operations, any difference there?
I would say processes and procedures. You can get away on small jobs, not having the best processes and procedures on bigger scale jobs. You have to define them. You have to really get into the weeds. We say you don't need trust if you have a process. So then you can trust the process. And that's really what changes with us. How do you sign in, sign out material, ordering and handling is massive. Jobs can be won and lost based on overuse or misuse of materials,
especially in our trade. It's a big swing. For us. Some of the differences are sometimes what type of people you need to hire because commercial and residential is going to be different. We talked about before what sort of financing you have, and you just really have to hone in on some of those. Yeah, that's a good point about people. And some people like to go to one job site all day and camp out there. Other guys like to go to 10, 15 different places a day, more high energy.
It just kind of depends. Well guys, any final thoughts today? Learn to say no. Learn to say. No. Learn to say no and stick to your plan. And if you don't have a plan, learn to create one. It takes some time. Sometimes at the early stages of your business, you feel overwhelmed. You don't have time to plan or you don't have time to have those meetings or go
and do your branding. One of my mentors told me, slow down to speed up and is one of the best piece of advice I've ever gotten because I'm pretty like, go, go, go. And it's always better to be calculated. You don't have to be too calculated, but just a little bit of time at the early stages of your business goes a really long way. You had mentioned the chamber. I love the BB, B Chamber, all this kind of stuff. Network, if you want to go out and get some contracts.
And then also along the lines of saying no is just breathe, think it through. And sometimes we want to answer right away. It's okay to give them an answer the next day as well, just to see what your comfort level is and how you can staff that. How do you have the money and things like that. Sleep on it. That's a good tip. Thanks guys. Thank you. Thank. You. Great conversation. I'm going to boil this down to three actionable steps.
Number one, learn to say no. Focus on what matters, and stay in your lane and don't drift into other lanes. Just kind of randomly stay in your lane and learn to say no, no is a complete sentence. Number two is nurture relationships. The higher volume you go, the more transactional it is. Not completely but more transactional. But when you're doing bigger contracts, relationships matter. It's more relational. And then number three is processes and procedures matter.
You can get away on a smaller scale, have kind of sloppy procedures, but when you're in those big high dollar jobs, you have to have your procedures and your SOPs figured out so you can actually get the job done profitably. Any thoughts on those? Sound good to you guys? You hit the nail on the head there. Cool. Thanks for being here. How do people find out more about you guys? You. Find us online at Guest Plumbing, on Instagram, YouTube, all the good stuff.
Check us out, follow us. We'll follow you back. It's the same as Dan just Clean Club Calgary. You guys were really making a difference in the marketplace. Your employees matter, clients matter, and you're blessing them by the work that you guys provide. And your teams appreciate it. The marketplace appreciates it. So keep it up. And thank you for listening. I hope that you heard something that will make your business more profitable and more efficient. I'm your host, Adam Sylvester.
You can find me@adamsylvester.com. Your clients and your team deserve your very best, so go give it to 'em. We'll see you next week.