Josh Bucio
Appearances
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Paid advertising should be your number one generator for business. Where most business owners get it wrong is they pump the brakes on this once they get too much business. 50 grand a month, does that scare you?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
So question for you. I mean. I love the goal of 30 million or whatnot. Like why so many cities? I mean, at that many cities, it's only 3 million per location.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
So 22 net. So for those that are listening and just understanding the difference, so net is obviously what you take home at the end of the day, considering ad backs, some of it's going into the inventory or whatnot. Gross margins, what's your guess is gross margins right now?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
It's probably an 85-15 split. 85% residential, yet you're not doing any marketing. Correct.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Cool. Well, let's jump over to the screen share. I'm going to share a couple things just based on what you've shared with me so far just to better understand. So back behind you. I got it. set up. So like right now you guys, so tomorrow we're actually going to be doing a little bit of a workshop, right? So you guys are in town.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Uh, we're going to be covering a marketing workshop in which we dive in. And so you guys, you guys are hanging out a lot in quadrant three and four of marketing. So quadrant, uh, quadrant four is referrals. So there's essentially four different types of marketing, right? So you got organic, which is quadrant one. You got paid, which is quadrant two. Quadrant three is affiliate.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Quadrant four is referral. So you guys are... basically all your business is affiliate and referrals. Is that correct? Right, right. And so, I mean, affiliates are fantastic relationships. Now, depending on what industry you're in, those can sometimes be more expensive than, you know, because you have to give like some big discount to a builder or whatever it may be, right?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
And they don't want to do the project for your typical high-end stuff. How much of your stuff is for builders right now?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Right. So a lot of your affiliates, you said, are just design companies. What else? Pool builders, new home builders. Yeah, I think that's the primary buckets. Nice, nice.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
So when I think about your strategy of getting to $30 million, I think what you're saying is correct that the first $3 million is pretty easy to get to with your current strategy from a marketing standpoint, right? Because you have this established bucket of affiliates that you know that you can go and to get the low-hanging fruit up to $3 million per location is probably...
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Okay. Yeah. So what I am seeing, I just want to just check you real quick. It looks like I'm seeing a gross margin of about 40%.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
fairly easy now the the cool thing is is like you have all these other avenues to be able to go and market that you're that you're missing out on especially if 85 of your business is to end users which is b2c right directly to the consumer you said 85 right yeah right and so like there is a a huge opportunity you're right now you're in you said what austin and where and san antonio
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Austin and San Antonio, just those two cities. Correct. Right. Okay. And those are, you know, what, an hour away from each other? Yeah. Hour and a half. An hour and a half. Yeah. Okay. Got it. So Austin and San Antonio, what's the population of Austin?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Chat GBT that for us, Dale. Let's see what we've got. So population of Austin Metro and population of San Antonio Metropolitan. Be interesting to know. So... You know, when I, so when I hear 1.2 million and, you know, the target is only 3 million per location, I think like, man, there's a lot more opportunity, especially if you can figure out how to market and sell to these people.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
And, you know, the downside, I know you talked about downside of like having 10 locations is like training and different things like that. But I'll tell you even more is like just straight up overhead costs, right? When you're talking about locations, you have to have manpower at every single location just for it to exist.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
And overhead, the downside of overhead is you pay for it regardless of whether or not you make sales. Right, right. And so every single location adds drastic amounts to your break even, right? Yeah.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Gross margin. Sweet, sweet. And so you guys have built this business. I know just kind of bootstrap this thing from the ground up, right? Yeah.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Yeah. I mean, we're not on here to say, hey, gotcha, but like to understand. No, right. Well, why is the market tap? Yeah. So, I mean, two and a half million people, right? Like what you guys are currently doing is essentially a dollar a person right now. And so the question is, is how do you get that up to, you know, three or four bucks a person across Metro?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
across the board and, and really just understanding like what it takes to get there. Right. Um, but yeah, like, uh, so you said you're at 270,000 on your, on your, on your break fixed. Yep. Okay.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Yeah, that's such a good point. Yeah. And the reality is, is like, even though a lot of your customers are one and done, right, with the average customer moving every seven years and that and most move within their same metropolitan, right, like that amount of recurring revenue is actual, you know, a real thing for sure.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
You know, and the thing I've learned in entrepreneurship is like a lot of times we make decisions based on ego. I don't know if you guys ever find yourself in that camp. Maybe.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
So let me just tell you like some of the mistakes that I made early on in entrepreneurship was like I did things to impress other people. You know, like locations. That sounds cool, right? Like more locations. Like a lot of times when we're very egocentric, we'll do things based on more locations than more money. right? Because it sounds bigger, it looks cooler, right?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Like, oh man, here I am, interstate, you know, I'm flying to my location up in wherever, you know, it is. And so a lot of times that type of mentality really taints our decision making. Instead of making decisions that are best for the business, we make decisions that are best for our ego. You guys ever find yourself doing that?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Do you know what the compounded annual growth rate is going to take to get to 30 million?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
have you have you calculated that yeah chat gpt on that one well and and what i what i mean by that is like so you guys have grown 25 year over year right and so just last year just last it's been 75 since inception okay all right so it's 75 since inception and then it was 25 this next year you do you have do you know what it's going to take for five years to grow to 30 million No. Forty percent.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
So I think it's I think it's less a little bit less than 40 percent. But like Daryl's calculating here real quick. But the the important thing to understand is like just picking a number out of a hat is like. you don't want to, right?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Like one of the things that we teach in creating like a vision and direction for the business is not only have a big number, but have a roadmap of exactly how to get there. You probably heard me talk a lot about this. Yeah, that was good. And so like with that, you have to have details like, okay, what does the annual growth rate have to look like?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Okay, so it's like a 38% growth. Right now, you've experienced a 25%. So what changes do you have to make in your business to be able to scale at 38%, which is close to double what you guys did this year? Right.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
But so there's, there's a few things that you have to make sure that scale one is like your pay structure. how you actually pay and then your management and what it's going to take to manage that kind of growth, right? Because to Daryl's point, growth requires more management, right?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Like just because you can do 3 million in one location, when you have 10 locations doing 3 million, that's going to require a whole lot more management than, you know, Right.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Yeah. The low hanging fruit is like only, you know, so valuable. Right.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
And so, I mean, that brings up another topic. It's like what you are and what you aren't, right? And maybe this is what you are, right? These big projects or whatnot. But if it's not the thing that you specialize in, like what do you specialize in? And so, because... I mean, money is made when you create a specialty and you are the go-to location business for that particular solution, right?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Where when customers think of your company, right? So when they think of Urban Oasis, what is Urban Oasis, right? It can't be like Jack of all trades, everything in...
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
And as long as you feel like that is simplified enough, then, then go for it. But, you know, as Josh, me and you talked about before, like, you know, you can make money doing anything, right? Like literally the biggest challenge that we have, I mean, for those that are watching and listening to this as entrepreneurs is saying no, right? Like if we, because we,
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
can see value creation in anything, right? Like I look at this desk and I'm like, well, if I actually owned the countertop company and I, oh, and I could hire a few guys to be able to create the actual woodwork of it. And I could own the painting company as well that comes in and does the work. Oh, and this is, you know, I mean, again, there's opportunity in everything.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
There's opportunity in creating cell phones. There's opportunity in selling water. There's opportunity in, in being sound producers, whatever. And so just really understanding exactly what makes Urban Oasis different than everybody else and not just a one-stop shop.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
I mean, I'll give you, Daryl kind of hinted at this a little bit earlier, but I mean, one of our, there's a guy in our community where, you know, they did a hundred million last year and net EBITDA, They were like 1.2% and cash was like 0.6% or something. So like 600 grand on $100 million. But if I were to ask you, would you love to have a $100 million revenue business?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
And, and, you know, it's, it's interesting. Like if you run a highly profitable business, like if you can figure out how to net out margins of 30% on 10 million bucks, right. That's a whole lot less work than running a hundred million dollar business that, you know, with a fraction, a fifth of the profitability is,
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
And so going back, I think just from like a practical standpoint, just you guys have an incredible opportunity to dive into organic and paid marketing within your markets. And like when we're talking about going deep, like that is the place. Most people do not compete in the paid space anymore. or compete well, right? Most people hire out their marketing, right? They bring in an external agency.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
They don't understand their strategy. So they hire somebody to say, hey, take this off my plate. I'm going to pay you X amount of dollars to be able to get this done. They don't really know exactly how they're going to be able to bring in new clients. And so then that agency, which probably doesn't know a whole lot about their business or industry or whatnot, they attempt it.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
They get a little bit of return, but since there's not good tracking, you know, the business is like, well, I don't even know if I'm making money off of this, right? That's literally most people's paid strategy. And so what I would encourage you guys to do, and obviously you're here for tomorrow, right?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
We're going to be diving into this specific, these specific topics, like how do I hit all four quadrants, right? The organic, the paid, the affiliate, the referrals, right?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
And so, because paid is typically where you can get the majority of your market penetration, where you really get direct traffic tied in, whether that's pay-per-click through Google and inquiry-based type stuff, or that's Facebook or YouTube or TikTok or whatever else. Like you guys have a really cool way to go and get paid because first of all,
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
What you guys do is the stuff that goes viral on organic and paid platforms, right? Like befores and afters. We love those. It went viral on TikTok a while back. Yeah, so you did a little bit of organic. The problem with when you go viral on like an organic type thing is it doesn't hit any of your target audience.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Right now, now all of a sudden you got somebody in Africa that's sweet before and after. And they're like, oh, man, cool stuff. Can you do, you know, a $200 job for me in South Africa? I don't think so. Yeah. Yeah. And so like, although organic's good, paid is different, right? Because you can target your audience. You can be able to get the exact ideal client profile. We call them ICP, right?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
And so when I'm looking at your guys' business, like 85% residential, no paid, you're doing zero paid advertising right now.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
So you're spending less than $1,000 a month. Yeah. Right. And so where a business of your size should be spending anywhere from like 5% to 10% of your total revenue on paid advertising, right? That's a lot. Yeah. That's a lot. So, I mean, you can do the math of 6 million, right? Like at 10% or let's call it 5%, you're spending anywhere from 300K all the way up to 600K, which is how much a month?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
25 to 50 grand a month, right? So you guys are, you know, 2% of where you should be, right? Of like your total spend. And so like you have an incredible opportunity. And the reason I bring this up is because right now you're formulating strategy of like...
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
three states, 10 cities, 30 million without ever really exploring the number one thing that should be driving your business, which is paid advertising. Right. And so, but first of all, congratulations. The fact that you guys have been able to do it through affiliate and referrals, I think a lot of companies suck at that.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Right. Which it should, right? Like paid advertising should be your number one generator for business, right? Because where most business owners get it wrong is they pump the brakes on this once they get too much business, right?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Instead of growing the operations or doing the things to be able to fulfill on that, they pump it, they get scared, they see the numbers, they're like, oh, that's too high, right? Like 50 grand a month, does that scare you?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Yeah, and if you're not used to doing it, it should be scary, right? But once you understand the science of it, they're like, okay, if marketing is 10% of my revenue and I'm doing, so what I'm looking at here on your financials, I see actually only 1%. You're spending 50K on, It says advertising and promotion. So what does that incorporate right now?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
That might be like yard signs and flags at our shop and stuff like that. Right. Which is part of marketing, but it's more branding related rather than direct marketing is what we call it. But like, you know, when... So you're spending about 50K a year where it should be, you know, 600,000.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
But the cool thing is, is like when you dial in this budget and really come at it from a scientific approach, you'll start understanding that for every $1 I spend, it's going to equal $10 in revenue, right? And so if I go and I spend another $500,000, that means I'm going to get another 5 million, right? And so obviously any business owner in their right mind, they want that. Right, right.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
So what's the percentage usually from paid marketing? Yeah, that's a great question. So your marketing should be... And I would say, and sales. So marketing and sales should be a total of about 20% in these type of businesses.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
And so usually about half of that is attributed to marketing and half of that's attributed to sales, which I know you guys don't have like a huge sales team or anything built out either.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Because those two things, those drivers, marketing and having a high-performing sales team, all of a sudden, you can flip this thing on its head, right? Because you can be generating sales in a variety of different marketing methods. You could be doing organic door-to-door sales.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
sales where people are going out and looking for quotes right by going door to door you can do paid advertising you come in you close it across the across the kitchen table or you do virtual i know we've talked a little bit about like virtual sales and those type of things and getting like real high ticket closers in in the room because right now your your sales department consists of who
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Yeah, me, Josh, and we've got two other sales reps.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
You're part lane that lead. Yeah, that's a good. And the, the, the other thing to consider here when we're talking about 10 cities is guess who doesn't scale? Me and Carter. That's right. That's right. And so, you know, although it's been easy up until this point to get $3 million in sales per location, you've had Carter and you in basically every single location. You guys don't scale, right?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Like your team can scale if you have good systems for recruiting and training and everything else. But The reality is, is you're not going to get the same type of production as you will from an owner that's sitting right underneath their nose. And so like, these are all things that you have to consider, especially when you're talking about like multiple locations.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
But man, huge opportunity from a marketing and sales standpoint. But also this also goes back to like, I mean, all this is tied together from like creating like a five year plan and and the way that you have your your offer dialed in. Right. Because if there is not enough margin to be able to spend 20 percent on sales and marketing. You know, you don't you don't have a scalable business. Right.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
And so then it goes back to, OK, what am I charging on the top line basis? Because like right now, from a percentage standpoint, you guys are charging 100 percent. You have 58 percent cogs. Right. Right. which means you have 42% gross margin, okay?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
If I have 42% gross margin and I go and I allocate 20% to sales and marketing, and then on top of that, I see you guys have like 10 to 15% in everything else, right? What does that leave us with? That only gives us 7% net margin at the end of the Right. And, you know, which... For a traditional construction business, that's very accurate, like 7%.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
The reason why you guys have been able to maintain a higher percentage is because one, Carter's doing all the sales, right? And you're not paying a big sales team and everything else. And so it's like, okay, how do we restructure this that allows us to still hit those targets of 20%? And so what do I need to do to my top line numbers to be able to be priced in. Right. Yeah.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Yeah, so you're referring to more like utilization, right? Like utilizing your fixed assets or your fixed labor, which is like you got this management in place or whatnot.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
So the first couple of jobs, are you guys doing this on your own?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
And that's a key thing for anybody to understand that's watching this or listening to this is just how valuable an additional dollar is to the business owner versus the customer, right? Like using this example, coming back over here to the whiteboard, where if it was $100 and you're taking home 7% at the end of the day, if you go and you charge the customer 100%,
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
101, you've increased their price by 1%, right? And your 1% goes directly to the bottom line, which has increased your net profit by 12%, right? So I mean, it's just such a drastic difference.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
And this goes to one of the core strategies and principles that we always teach that you don't have a true competitor. A lot of times when we go and we look at the marketplace, we try pricing according to the competition out there. We make poor decisions for our business versus actually doing what's best for our business, backing it up with competition.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
the actual financial strategy and saying, okay, this is the structure that works and this is what we're going to charge because we know that the market, one, will absorb this, they'll accept this, and two, this is the numbers that we need to be able to make our business work.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Based on, based on what you hear us saying, just kind of this discussion, like what, what do you think, like what are some mental changes or even some things you're like, ah, I need to, I need to implement that.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
That's a good testimonial. We appreciate it. So, I have go deeper, basically deeper per location than implement a paid marketing strategy. Right. And so, I think, you know, those three things, you know, just... addressing those could, could, uh, you know, drastically impact the business and the direction that you're going to be going. And so, um, appreciate, first of all, thanks.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Thanks for your time, but thank you for the testimonial, uh, wrapping it up with, uh, the, the end of this episode. Can you share with guys like what you've been able, how being a part of a next level pros and part of our elite group and how that, how that's impacted your life? Yeah. Yeah.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Tell us a little bit more about that. What are some things that you learned from our community that you've impacted on your culture?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
I love it. I love it. That was awesome to see. Well, appreciate you guys jumping on the show. You guys have been incredible being here. And for the listeners and those that are watching on YouTube, make sure that you like, comment, subscribe. If you have any questions, we are more than happy to dive into them. Just leaving on the comments in the comment section.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
And as always, for those that are looking at getting more from the Next Level community, community. Go on over to go next level pros.com. You can test out being a part of our weekly calls for only 47 bucks. Once again, go next level pros.com until next time.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
That's awesome. Yeah, it's awesome. Year one, what did you guys close the books at? How much revenue?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Everybody, welcome to another episode of Next Level Pros. Today, we have Carter and Josh. They flew in here from Austin. Super excited to be diving in and talking about their business. They're building a pretty sweet business down in Texas. Urban Oasis is the name. It's a landscaping business, correct? Correct. Yes, sir. Yes, sir.
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
But at what point did you decide to go all in on it, give up school, give up those type of things?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Yeah, yeah, for sure. So at what point did you say, hey, we need more help, we need guys that actually know what they're doing, or did you learn most of this just through trial and error, or what was your biggest mentors in building this thing?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Very cool. Very cool. So fast forward to, uh, December of 2024 right now. Right. So you guys are pacing going to be doing about six, two, six, 3 million, uh, this year, which is awesome. Fantastic. Nice work on, on building that out. What are, what are the biggest, uh, struggles that you guys are dealing with? How, how big is your team now?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
Nice. So that's the amount of employees. What are the biggest things that are holding you up now?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
I mean, there's a lot of different ways you can make money in that business, right? And so like really defining who you are, what you say yes to and what you say no to. So what are some things that you guys are currently saying no to that allow you to really focus on who Urban Oasis is?
Next Level Pros
#133: Increasing 30% year over year with no marketing? Will it still work?
team so it kind of compiles into you know everything we expand then everybody needs to expand per crew because we manage everything on a crew basis so what would you say the the five-year vision is for urban oasis like who who is urban oasis what do they do what how big are they like what