SPEAKER_03 0:23

It's great to see everybody's faces. Appreciate you guys joining today. Hi, Jonathan. We've got some people on their very first call, and then we've got some people that have been here a few times. So this is gonna be great. Well, um, I think everybody's here. Everybody should be in the lobby. Perfect. Well, welcome, welcome, welcome, Michael. Because Theo is here with us today, and um, he is going to be our fabulous host. So, Michael, let me let you introduce yourself first, and then we'll kick it off with um all of y'all's questions for the day.

SPEAKER_08 1:00

Cool, cool, well, hello, everybody. And this is actually a pretty big group. So um I'm gonna tell you a little bit about myself, what got me here. Uh, but it started about 11 years ago. I came from the financial services industry. So broker, floor trader, um, managed offices. Um at the end, though, I spent about a couple of years actually door knocking on small banks, and I would get them to actually start up either a broker dealer or I would connect them and then we would convert their clients into um financial service clients. And so they would do IRA rollovers or just general investing and whatnot. But that's what I did. And when I had this business um under myself, it was uh I got to a point where I needed to decide what I was gonna do. And the challenges I had was that I had three little kids and I would travel from Sunday night till Thursday, typically, anywhere from Arizona all the way up to Portland. And I wanted a business that I could actually run from my backyard in a sense, in my neighborhood. Um, it was kind of sad because I would literally get on a plane on Sunday and just kind of dread the time of uh being away from the family. And every time I would come back home, I'd be thinking to myself, gosh, if I could just do this from home, if I could do it in my neighborhood, um, I would love that. And that's when I started looking at businesses. Um, the one thing that I started looking at when I was looking at businesses is I've done sales, you know, pretty much all my life. And I that that doesn't really scare me. And I enjoy the sales side of it. But the one thing that I've learned over time is that sales is a rough gig to be able to sell, sell continuously. And with selling investments and whatnot, you get trails. And so trails was always something that I look forward to and being able to grow like a book of business on the investment side. And so when I started looking at businesses, I was looking at businesses in the sense of where is the revenue coming from? Is it recurring? Is it stable? Could I really build a budget off of what I'm selling for the future? Could I build off of that? And that's really what led me towards um citywide. I mean, I went, I looked at everything. I looked at you know, small markets, I looked at restaurants, I looked at um at one point I was um gonna just open up a broker dealer. Um, and of course, regulation and whatnot is a little bit of a challenge there, so that I stayed away from that. Uh, but when I came across citywide, it it really kind of rang the bell for me because I saw that reoccurring business. Everything that I sold, the idea was that I had to be servicing my clients, I had to be good to my clients, and they had to find a need within me. And so with a commercial building, it becomes fairly easy to find needs there. Um, and that's where really the understanding of citywide came. But I'll tell you that the real sale came was when I went to Discovery Day. I got to go to Kansas City and I got to meet the team. Um, and so you know, I had been about 16, 17 years in financial services, dealing with people on the West Coast and dealing with people on the East Coast in financial services, not the kindest people. And when I went to Kansas City, it was quite the opposite, which was just, you know, you go to Kansas City, everyone's smiling, everyone is telling you good morning, and you're thinking to yourself, what you know, why are you doing this? Why are you like this? And that's when I realized that, you know, hey, these are the people that I want to do business with. And that's truly what sold me right at the end was that I wanted to get in business with these types of folks. These are the type of people that want to be on your side. They want nothing more than for you to win at the end of the day. And that was really just a cherry on top, and that's what really sold me to be here. So I've been here now for 11 years. Um, we have a goal. Uh, when we first got started, we had a 10-year goal to hit 10 million. Uh, we hit that um just before year nine or so. Um, last year we finished uh above 13 million. Uh, we have about 20 employees. Um, everyone, for the exception of maybe two individuals or three individuals, everyone does sales here. Uh, you're either a salesperson or you're an account manager. And even if you're an account manager, you're still selling. Um, it's a sales organization. So if that's if that's in your your wheelhouse, and then you would uh you would do awesome. But if it's not, it's something that can be hired too. And so, you know, Jeff always talks about that, you know, hiring to whatever is your weakness. So if if that is your weakness or if operation is your weakness, and then you need to find the individual that's gonna help you get there. And by hiring is is a great starting point. So that is a little bit about me, and that's a little bit about where I am today. Um, we cover the inland empire, which is Southern California. So we have actually a pretty large territory in Inland Empire. Um, this year we actually bought another territory. Um, so I have a managing partner now, and Rory covers uh the Riverside Territory. So it goes from down from Riverside all the way down to Temecula uh just right above um San Diego. Uh both of our offices butt up to each other. Um so we have a pretty sizable area that we're covering these days now. And that territory will actually open up. We're looking at opening up um March 1st.

SPEAKER_03 7:39

Awesome. Thank you, Michael. I think this is really helpful for all of that background and goals and everything in between. I like what you said about everyone is a salesperson because I think that that's a really important key factor in this business. You know, whether you are an account manager, whether you are a salesperson, you're selling, and everything in between. So making sure that you're aligning with those kind of people and knowing how to hire and fire and inspire and lead and train those kind of individuals is all really important to your success of your business. So I know we have a lot of um brand new people on the call today. So the purpose of the call is for you guys to come prepared with questions. Feel free to either raise your hand, come off mute, jump right in, uh, want you guys to get the most out of this call. So take yourself off mute and just jump in with your questions.

SPEAKER_04 8:35

Hey Michael, uh, this is Jonathan. Nice to meet you. Hi there. Likewise. I'd I'd love to hear uh a little bit about how you go about sourcing these salespeople. Do you uh try and find people who you know have a lot of experience in sales, or do you like to hire somebody who might be a little bit more fresh and kind of train them on what to look for?

SPEAKER_08 8:57

Yeah, it's a great question. So so first of all, you know, the the sales hiring really we we kind of stick with the citywide model. So we use all of their assessments. Um, they've been doing this now for you know 20 plus years. They have lined up um a number of different assessments that is geared towards a the salesperson, b, the operations person. And so it's really about putting the individual into one of these buckets. Now, as far as you know, hiring for this individual, you know, I am typically looking for a true salesperson, someone that sells cars, to me, is not a salesperson. You need a salesperson that is literally going to go out, knock on doors, be able to talk to people, be able to follow up with emails, be able to correspond via telephone. Um, the reality is that there's no magic pill in attracting these clients. Um, this isn't we're we're not selling, for instance, financial services, right? With emails and you know, really cool videos and TikTok stuff and and social media. This is literally you trying to find the maintenance manager at the back of the building that runs this, you know, million, you know, 20, 30, 40, 50 million dollar organization, and you're trying to connect with this individual uh to see what it is that you can do there, whether it's janitorial, handyman services, landscaping, day porter services, um, you're that's the the client that you're trying to connect to. So you want an individual that is really fearless and can hop over the wall, knock on that door, and just present themselves.

SPEAKER_04 10:55

You said you have roughly 20 employees now. How many were hired as like kind of sales executives? And from your experience since you've been in the industry so long, do you notice that every, you know, four to five sales executives you hire, you're able to retain or a certain percentage are successful? Like how how difficult is it for you if you wanted to expand your team and find five more solid sales executives? Yeah, how many people would you have to go through before actually finding that?

SPEAKER_08 11:25

Yeah, that's that's a that's a great question. And there is a lot of turnover. Um, it's a tough job. I'm not gonna I'm not gonna lie to you. It's it's a tough job. It took me a couple of years to really uh and truly, for instance, I have two senior salespeople. Uh, on the sales side, I have uh four salespeople for Inland Empire, and then we just hired someone on the riverside side. Um, these four salespeople are then managed by a director of sales, and then he also has um someone that just simply sets appointments. Of these four uh people, two of them have been with me three plus years. The other two people are fairly new. Um you will find yourself in the beginning going through them, hopefully rather quickly. You you don't want to sit with someone that is not gonna sell. Um, our ramp up is six months, though. So we look at a salesperson um and we look at setting them up on a six-month ramp up. Month one is set appointments, month two is sell a thousand dollars, month three is two thousand dollars, so on till you get to five thousand dollars. And so it it it takes a little bit of time for you to make these connections, be able to propose, be able to follow up. Um, you know, the person you're talking to may love it, but they got to get an approval from somewhere else in the country, and they're waiting for approval, and you're continuously just hunting all along the way. But yeah, it's it's a challenge. It's a challenge in the beginning. I will tell you though, and this is um, and as a matter of fact, our new territory riverside, we'll start with two salespeople. I think that if you start with one salesperson, it's a challenge in the sense that if that person does not work out, which 50% of the time they just simply don't, um the replacement will now be another six months.

SPEAKER_04 13:47

Now, is there a a compensation or incentive package that works better for you in these territories? Or do you kind of um uh just do like a very basic, you know, base salary plus a commission?

SPEAKER_08 14:03

Yeah. So the the and that's that's a that's a good question too. Um, so we use something that's very basic. We use salary and commissions. Commissions are based off of a tier group, and then you have quarterly bonuses as well. Um, but other places, for instance, like the home office, they've implemented different types of plans where the compensation does drag out a couple of years and there's a little bit more of a drip on that compensation. But here's the reality um we're 20 people, ADB, ADP does our payroll. So for you to keep track of all of the different types of compensations in the in your office, can be cumbers can become cumbersome. Right. And so I've always kept it very simple. I don't want to mess with anyone's money. Um, so simplicity here has uh has worked.

SPEAKER_07 15:05

Thank you.

SPEAKER_12 15:09

Charles, do you want to go ahead and jump in?

SPEAKER_00 15:12

Yeah, thank you very much, uh Micah. Uh, thanks for sharing your experience on the progress you've made so far. Uh my first question I'd like to ask is uh related to CIS. Um, would you like to share some uh perspectives in terms of uh where you get the greatest mileage in terms of client acquisition? Is it through networking? Is it door-to-door knocking? What exactly do you do to acquire CIS that kind of generates the highest revenue for you in terms of client acquisition, also?

SPEAKER_08 15:44

Yeah, it's it's all of above. All of above. I mean, so our territory, as I was saying, is is a good sized territory for Inland Empire. And even Riverside, what we've done there, we break our territories up into zip codes. And so from those zip codes, we we lot out for the salesperson, we ask them to hunt out of that territory. At that point, what they do is they pretty much go to Google Maps, they look at it, they start sectoring out their Google Maps streets, and they're just going door to door. Um, we asked for 50 activities in a day. So 50 activities, in a sense, could be 10 door knocks, 10 phone calls to follow up on, 10 emails, 10 LinkedIn connections, and then you're following up with another 10 calls on follow-ups. So those are 50. And so what ends up happening during the week is that typically you'll go all the way around the your street in a sense. The following week you'll move over, and now you're kind of following up on whatever didn't work out from the week before, and you just continuously, continuously, continuously do this. And typically, of those 10 buildings, more than likely, you're gonna find three or four buildings that are real gems, and you know they contract out and they're great for your business, and they will always become part of your top 100 in a sense, and continuous follow-up, and then you'll have another six or seven that'll fall to the wayside, and perhaps you know that there's never going to be a chance ever, but you'll check in maybe six months later. And so all of this information has to be inputted into CRM. And so now you got a bit of a drip campaign that's happening there. But like what I said before, the type of folks that we're reaching out to, these are the folks that aren't necessarily um flipping through social media to find their next building maintenance person. These are individuals that are typically out in the back doing the work. A perfect example would be a dealership. A dealership, the person that's in charge of a dealership typically is a service director. A service director is typically right there as you enter service in the back office, and more than likely, he's not dealing necessarily. He's he's kind of in charge of the janitorial, but he doesn't want to be in charge of the janitorial. He he really has no clue that he has a leak in the maintenance men's room or a busted urinal or anything like that. And so you have to connect with these individuals and be likable and have them say, sure, yes, get me that quote.

SPEAKER_12 18:50

Thank you very much.

SPEAKER_00 18:51

My last question, sorry, before the next person comes on. My next question is you said uh uh you were able to make uh a 10 million uh dollars mark in your ninth year, right? Which was um a year ahead of uh your initial uh target that you set. So at what point did you break even? Which year in each of these uh in uh the time frame were able to break even.

SPEAKER_08 19:14

Break-even for us was uh right after uh two and a half years, somewhere it happened between two and a half to three years.

SPEAKER_07 19:27

Thank you. Yep. Your biggest cost in the beginning should be your salespeople.

SPEAKER_08 19:36

Okay, so that is that is really that is really the cost that's gonna light your fire to allow you to go a lot further. I think I could have gone there a lot quicker if I would have started with two salespeople, if I would have had more poles in the water, in a sense, to bring bring in the front door.

SPEAKER_03 20:01

Thanks, Michael. Bashar, I'll let you jump in and then Matthew, you can go right after.

SPEAKER_05 20:05

Thanks, Savannah. Hi, Michael. This is Bashar. Um, I wanted to ask you about uh the experience, uh, I guess difference uh today since you're building the second territory compared to where you started 11 years ago. So maybe what's uh stayed kind of similar and what's changing based on yeah, yeah, yeah.

SPEAKER_08 20:24

Uh you know, Bashar, it's almost like cheating, um, only because we have an existing office right now. Um we already have payroll, we have insurance, we have benefits, we have um uh we bought uh the building that we're currently in, we bought it uh three years ago. Um, it's a nice facility. I I we bring candidates in to interview. When I started 11 years ago, we had a thousand square feet. It literally had two offices, and then it had a third little conference room area. And by the time we left there, I had 11 people and their desks were all lined up along the wall. It wasn't the nicest place to bring candidates to hire. And sometimes I would simply say, Meet me at the Starbucks, let's let's have a coffee or let's have lunch instead. Um, so yeah, the second territory build out is is um extremely easy. Um, you know, obviously we know what we're looking for. Rory's been with me now for coming up on two years. So he's been doing his job and managing folks. So um he knows how to bid out buildings and um, you know, the personality testing, we understand them a heck of a lot better now than what we did back then. Which the, you know, those personality tests that um that we utilize from Citywide, I mean, they're pretty fantastic. I mean, it ain't gonna tell you everything, but it definitely gives you the leg up and Those are the kind of tools that you know you're buying into. So um it's advantageous to obviously use all of that.

SPEAKER_12 22:14

Matthew, did you want to go?

SPEAKER_11 22:17

Uh yeah, thanks so much for uh having the call, Michael. And I actually uh I used to live in Corona Del Mar, so I knew Newport. So I think I think I was actually in your territory for a little bit. Okay. Okay. Um you know, I I actually come from a financial sales background as well. Um I'm sort of sort of curious as to when you go pitch a client, uh, what is your value proposition to them? Um so you know, how does your pitch start off and how do you differentiate between you know the other companies doing uh something similar?

SPEAKER_08 22:50

Yeah. So the number one thing is that we're on the client's side. Okay, so at the end of the day, our biggest value to the client is that we're really on their side making these judgment calls on their facility. So that means that we're hiring their janitorial, we're hiring their handyman services, we're coming to them with recommendations. We will take care of everything from the roof to the curb. Um, you know, we're 24-7. Our facility solutions manager is a technically to them, is really an asset as the management when it comes to maintenance to their building. You know, consider us your concierge service to your building at the end of the day.

SPEAKER_11 23:45

Uh got it. Okay. So it's more of a consultant, uh, consultant relationship instead of uh a cleaner.

SPEAKER_08 23:55

And that's exactly the biggest difference. We are not your cleaners, you know. Um, if if I was your cleaner and if these were my employees and I'm your account manager, and you know, Matthew, you tell me that you currently have a company right now and they are cleaning. What happens when there's an issue? Well, I called, I call Nick and Nick comes down. Okay, are these Nick's employees? Yeah, they're Nick's employees. Okay, so what about if you're complaining about a particular employee that perhaps maybe uh you don't like the way that he's working? Can Nick yank him out? Well, Nick would probably have to in California, you'd probably have to write him up a handful of times, and then he's probably gonna give me an excuse about hey, he's a good guy, he you know, he has a family to take care of. Um, why don't we give him another shot? Um, I'm gonna be coming around to kind of oversee him a little bit more. If you're with Citywide, you tell me you don't like this particular cleaner, he's gone and he's out tonight.

SPEAKER_11 25:02

Got it. And um typically, how large are the contractors uh that you contract with?

SPEAKER_08 25:09

I I I suppose it depends on the job you're doing, but so in our world, you you you really have a mix from a small, small, small business. It may even be husband and wife, and those type of contractors are great for like your smaller accounts. Maybe you have a small account for 750 a month, and you know, the cleaners go in once a week to clean up a small office or something like that. That's great. And then we have contractors at uh they have 50 to 75 employees. Um, they do a lot more than just janitorial. Um, and those contractors are great for the larger facilities that we have that require 10 to 15 porters seven days a week in a logistic hub, etc. etc. But they would never take the $750 a month account. So uh our spectrum of contractors is you know all of them from zero to hero. Yeah.

SPEAKER_11 26:14

Got it. Uh and just your lead generation sources is it uh predominantly well, I assume I I think you said you do a whole host of different things, right? Right, right under the sun. Uh, but which one is more effective? So is it uh leads, uh, you know, using a company like I don't know, the cleaning in motion or you know, whatever it is, uh to to filter leads to you or knocking on doors, or you know, what what what's actually proved the most successful?

SPEAKER_08 26:43

Door knocking. Door knocking. Door knocking. Um, and I'll tell you why. Um, it it does take a little bit longer on the door knocking side. Um, but the attraction that happens with a door knock is so much stronger than someone sending us a lead from some um from some company or even like if you buy a lead, like for instance, we'll some we'll take a look at some websites and you can kind of start looking at leads and maybe you purchase it or whatnot. Uh, but the door knocking is really relationship building. And so you may door knock a place for 30 days, and the the person's telling you no, no, no. And finally you get that person to tell you, yes, you know, Matt, yeah, just go ahead and come in. Let's talk. Hey, what happened? You were telling me no for 30 days. Well, here's what happened. My cleaner never showed up last night. Um, come to find out he was arrested. Um, and it wasn't his first time. Oh, that's really too bad. Yeah, okay. Well, let's let's talk about you know your needs here. And so you start you start developing that relationship right out of the gate. And you probably know something already about that door knocker because you've stalked him on social media. You you've uh maybe already knocked on the doors beside them and probably know a little bit more about the company. And so that connection right there, if that salesperson can make that connection, can set that appointment. I believe it's sold on that first walk. Not literally, but it's sold between an understanding of yes, you know, the head nod of yes, yes, I like this, I like this, I like this a lot. Get me that pricing. How soon can you come back?

SPEAKER_11 28:38

Got it. And sorry, just what one last one and I'll uh um so is it better to go deep with one client versus uh spread it out? Um will will people come uh you know contract with you or hire you to do like a comprehensive full facility?

SPEAKER_08 29:01

So Brian, look so remember, in our world, what ends up happening is that we have salespeople. The job of the salesperson is simply dock, uh door knock, get the scope of work, get it signed off by the client. What they do with that document is they hand it over to operations, their facility solutions manager. That FSM is then responsible for the upsell of everything else. So that's where they come in and they say, Hey, how about that um that flickering light? How about that leaking faucet? How about that broken urinal? How about that landscaping out in front? And so the ops person will then take care of all of that while your salesperson is just looking for that recurring piece.

SPEAKER_11 29:49

And and you guys go in there, you know, periodically to say, hey, I noticed, I noticed this toilet seat's busted. Like, you know, we're operations, yep.

SPEAKER_08 29:58

Operations and schedules, their their meetings, uh, depending on how big the account is, if it's something medical, if it's a dealership, if it's a school, they're typically showing up once a week. Um, if it's a small office, maybe once a month. Um if it's if it's something in between, maybe it's every two weeks. And so they're popping in, they're checking in on the work, they're taking a look at anything else that can be improved, and they're reporting that back to their contact. That's what keeps us there.

SPEAKER_11 30:30

Great. Thank you so much. I appreciate it.

SPEAKER_03 30:32

Matthew, to expand on that a little bit too, I think that, you know, when we used to be a janitorial company 60 years ago, all we had was janitorial. And if they didn't need us, then the conversation was a little bit shorter, right? Or maybe it was a little bit more difficult to get through the front door. But being able to be that one point of contact and that management company of a model that we are today and have evolved into, it allows you to, you know, figure out, okay, well, if you're happy with your janitorial, how about that landscaping? And they might get to talking about, you know, the landscaper that's not showing up on time or the pest control that's not providing the quality of service that you want. And you might start with that one service, but just like Michael said, then your FSM, those facility solutions managers or what we call the what we call the account managers, they're the ones that are then going to get those additional services. So you're not going to usually come in and ever take on multiple services, like being that all inclusive, but you're going to come in maybe starting with one or two. And then hopefully by the end of the year, Michael, you could probably answer this better than me, but I would estimate that sometimes you're up to four services. Maybe if you're if that FSM is doing their job regularly and selling those additional services, then that's when that client builds on that relationship.

SPEAKER_11 31:50

Makes sense. Okay. Thank you.

SPEAKER_12 31:53

Of course. You're up next. All right.

SPEAKER_10 32:02

Um question. Um, you said you had, did you say you have like 20 employees? Yes. Okay. And then can you can you give I know you said like four of them are salespeople? Yep. Can you give like a breakdown of that? Sure.

SPEAKER_08 32:17

Yeah, absolutely. So um four are sales executives, um, um, one outbound caller setting appointments, and those those five people are managed by a sales director. Um, and then on the operation side, we have six account managers or FSM specifically solution managers, and then we have uh two night managers, and then we have a director of operations.

SPEAKER_10 32:49

Okay.

SPEAKER_08 32:50

We have a office manager, and she kind of controls everything. Um financials, billing, ARAP, all that good stuff, and then she has an assistant uh that helps out, and then we have um a CBS person, which is commercial building solutions, that person sells all that is transactional, so nothing that is reoccurring, although he has reoccurring clients. And what I mean by that is like, for instance, he deals with a lot of um apartment complexes. Um he was just telling me about a job this morning where he's going in and there's certain apartments that he's gonna go in and put in some ADA handles and all of these apartments, and so that's a one-time job. And last week it was a leak out by the pool area. Uh, the week before, there was another complex that needed uh fencing redone um by some dog park area or whatnot. So he gets called, he has a group of clients and he continuously looks for more clients, but his groups of clients are really clients that are just needing services, building maintenance services.

SPEAKER_10 34:12

Yeah. Okay. So your like clients, they're um obviously they're fine with knowing you're just subbing, kind of subbing everything out, controlling it.

SPEAKER_07 34:25

Correct. I'm sorry, can you what was that again?

SPEAKER_10 34:28

Oh, yeah, I just said so that your clients um are okay with uh they know that you're kind of just like subbing out all the jobs and kind of overseeing it all, and they're they like that.

SPEAKER_08 34:41

We sell that as a benefit, yeah. Okay, we sell it as a benefit, we sell it as there's if these were my employees and there's an issue, there's no way for me to truly, truly manage these individuals. Right. Yeah, and the reality, the reality is is that no one's gonna be able to uh to really spend the time to do it. I'm a perfect example of this. Uh, we bought this building three years ago, and um I gutted out uh a good portion of it. Um, there was this lady, um, Karen, who had I had met a year prior, and she has an elevator business, but she does a lot of design drawing and whatnot, and she designs her beach houses. And I called her up and I said, Karen, I go, I need you to come look at this building. So she came down, she goes, What am I doing here? I go, I need you to redo my building with all of your sketches and everything. Right. I go, I want this color, I want that. She goes, Mike, why are you why am I gonna do this for you if I'm probably gonna be using the same contractors you use? I said, I don't have the time to decide on the color black or the color white or what kind of finish I want here. I need you to just do that.

SPEAKER_07 36:01

Yep.

SPEAKER_03 36:02

And Scott, that kind of ties back into what Michael was saying earlier about our value proposition and representing the client, sitting on the same side of the table of the client. The benefit, like he's saying, of selling that as part of the service is the fact that if anything goes wrong and you're unhappy with something, we're gonna fix that problem for you as the one point of contact. So it's not something you as the building manager have to end up following up with.

SPEAKER_10 36:27

Yeah. Oh, it makes sense as you're as I'm listening and you're and um getting examples. So no, that's good. Um is it kind of does it is it like kind of the lead-in, is like cleaning typically, and then it and then it goes in okay.

SPEAKER_08 36:44

Well, okay, so for the sales executives, yeah. Um, it you know, the what they want to sell is the way they get paid is on janitorial landscaping and day porter services.

SPEAKER_12 36:56

Okay.

SPEAKER_08 36:56

So their their pitch is typically, you know, they want to know a little bit about do you contract out your cleaning services? And at the same time, in that conversation, they're talking about citywide and the 20 plus different services that we do.

SPEAKER_10 37:12

Yeah.

SPEAKER_08 37:13

So if the client comes back and says, hey, listen, we're a union house, we do everything in-house, you know, da-da-da-da. The only thing that we don't do here and that we do contract out for is our landscaping. Or maybe it's um we do have a project and we are looking for quotes. Uh, we ask our two questions, you know, what's going out to what's going out to bid and what contractors giving you the biggest issue. Okay. Um, we have a painting job that's going out to bid. Oh, okay, great. Um, well, my account manager, um, David, will be here and he'd love to give you a quote on that. And so that lead just gets pushed off to operations.

SPEAKER_10 37:53

Yeah, okay. Are any of the like cleaning, I assume, is like monthly or by or twice a week or whatever it is, but or any of the oh, go ahead.

SPEAKER_08 38:03

Yeah, it could be seven days, it could be twice a day. Yeah, yeah, there's a whole variation of that. Yeah, absolutely.

SPEAKER_10 38:10

Yep. And then Adria mentioned the other day that maybe landscaping could fall under that. I was trying to just determine which ones, which services can become kind of that more recurring rather than like a one-off job.

SPEAKER_08 38:24

Landscaping, landscaping definitely falls in there. So, landscaping typically we're doing it once a week, um, or every other week, just depending on budget. Uh, but yes, landscaping, that's why we allow our sales executives to sell it because that is another recurring piece um as part of the portfolio.

unknown 38:43

Okay.

SPEAKER_08 38:44

And so is day porter services. So we have companies that'll hire us, they have maybe three shifts uh at a manufacturing uh facility, and every shift the restrooms need to be clean. So we'll show up for a couple hours, we'll clean during that shift. We won't come back for another six hours and do it all over again. We'll do it three times a day.

SPEAKER_10 39:05

Okay. Are like the like the cleaning contracts, are those monthly, or are they get can you get longer than that?

SPEAKER_08 39:14

Um, typically our contracts do run on a monthly basis. Now, if the contract is really large and the issue becomes in cash flow, we will talk to a client and divide that up into maybe 15 days. But typically we're working on a on a monthly schedule.

SPEAKER_07 39:34

Okay.

SPEAKER_10 39:35

Okay. Um, I don't know if you can share on these calls, but um, like the you gave some of your your volume um numbers or revenue numbers. Can you share like what your what you net on that?

SPEAKER_08 39:52

Um yeah, yeah. I mean, we you know, my goal is every year is well, this is now, so this is our 11th year. And um, so if we I I would say the last four years or so, right or right after right during COVID or so, um, my goal has always been to bring home a million dollars. That's that's my standard goal that I'm looking for. Um and so that is typically what I want and what we've been able to achieve in the past uh four to five years, um, after everything else is paid for and whatnot. So you know, our return is definitely in the the double digits. Last year was probably our worst year, um, but we still grew by about a million and a half, but it was our worst year.

SPEAKER_10 40:52

Okay. That's helpful.

SPEAKER_02 40:56

Appreciate it.

SPEAKER_12 40:58

Charles, go ahead.

SPEAKER_00 41:02

All right, thank you, Savannah. Yeah, uh, thank you, Mike. Uh, a quick question uh in terms uh when it comes to vendor management or subcontractor management, right? Over the years, uh given that you have to work with subcontractors, how do you manage them to ensure consistent quality delivery? And uh, have you had cases where they did not deliver your satisfaction? How did you handle that?

SPEAKER_08 41:26

Uh yeah, we get that dissatisfaction. You know, that's what we're looking for, right? Our account managers are looking for that on a daily basis. Um, so first of all, dealing with contractors is is never easy, but that's why our clients hire us, right? That's exactly what our job is. If if if contractors were absolutely perfect, there would probably be no need for citywide. Um, but the reality is that most of these contractors um they do great work and they're able to do the job, but you know, invoicing, um, finaling a job, um, performance from their workers is always problematic and is always an issue. And that's where we come in. Um, our account managers are looking for the deficiencies, they're looking for the corrections. Our night managers are finaling buildings, they're following up on corrections, um, they're looking for that. If the contractor doesn't work out, and if it's an issue, they're getting yanked out of there. And all we're doing is replacing that contractor. And at that point, it's our job to make certain that that contractor is trained by our night manager or account manager to show them and explain what the scope of work is at that particular facility. But yeah, that's what keeps us in business.

SPEAKER_01 43:00

Michael, I think that um a question that comes up for me a lot when I'm talking with candidates is understanding that those tiers of contractors, right? Like not necessarily aligning with the mom and pops, but certainly also not aligning with the company that might have, you know, 50 of their own salespeople, 150 logoed trucks on the street. Can you kind of talk through how you identify a really good partner in that way?

SPEAKER_08 43:28

Yeah. And like what we were talking about before, typically, if it's a smaller account, if it's an office of maybe 4,000 square feet with two restrooms, um, for something like that, we're typically using a smaller contractor. Um, and typically as the accounts get larger, that's where you got to deal with someone that does have a bit more sophistication. Someone that does have a check in functionality or a clock in functionality. Of their workers. Someone that does have an account manager that is finaling the building, perhaps maybe on a nightly basis. We have some schools that are multi-buildings. And you know, walking into one of the buildings will simply turn you around. And so sometimes knowing how to divide a school up with perhaps maybe a couple of different contractors in each different building, and they're just dedicated to that building is a solution. Typically, you know, your account manager has to be well versed, obviously, in not only dealing with a client, but dealing with a contractor and explaining and setting them up on this sort of leadership of you know what needs to get done and at what time and uh at and what's going to be required. So there is, you know, much like you're you're selling on the front side with that client, you're coaching and leading as well with these contractors. And you'll start seeing the difference in presentation and language when you meet these individuals.

SPEAKER_07 45:20

Um it'll become very, very apparent.

SPEAKER_00 45:27

Thank you. So a follow-up question to that will be uh in the last 11 years that you've been in this, uh if there's anything that keeps you awake at night, what would that be if you had to speak point to any particular pain point?

SPEAKER_08 45:41

You know, I think uh you know, with now with with some management, we don't uh, you know, I'm not as concerned about it. Um the things that really kind of keep me awake are really um non-paying paying clients. That's that's always something of an issue. Um and sales. You know, without without new sales, um I know that we're going against each uh ourselves. And so if we aren't keeping up with our budget, um that's problematic to me.

SPEAKER_12 46:27

Thank you.

SPEAKER_03 46:30

Andrew, go ahead. Sure, you can follow up right after.

SPEAKER_09 46:33

All right. Hi Michael, first of all, thanks for taking the time to talk to us today. I appreciate it. I had to chuckle when you said dealing with banks is not always the easiest because that's what I do now too. So I can find your pay. Um I just had a couple questions. So as you were starting off in developing and in your putting your sales plan together, did you target a certain size organization, a certain industry, or you know, did you have a target, or was it just kind of any anyone on the street that would it was really anyone in the street, but I will tell you something that we did target was that Citywide has national accounts.

SPEAKER_08 47:14

So they have two types of different national accounts. They have top-down national accounts, which are automatically kind of delivered to you in your area, but they also have preferred clients. And some of these preferred clients, you're able to just walk up and say, hey, listen, we're part of your facility team. We're on your books and records as a representative. I'd love to give you a quote. And so that was a big leg up when we would go door knock these individuals. It was a heck of a lot easier walking into XYZ and saying, Hey, my name is Michael, and you know, we're a building maintenance company. And let me ask you a couple of questions when you can walk in and say, Hey, go ahead and check your maintenance logs and whatnot, and you'll find our name in there because we're a preferred vendor for you. Yeah. So that was definitely right out of the gate. And that's something you pay for, so you might as well utilize it.

unknown 48:11

Yeah.

SPEAKER_09 48:12

Okay. That's helpful. Um, and just a follow-up question that kind of scotted at. So you have 20 employees roughly right now. Does the citywide playbook kind of help you figure out, you know, what type of roles do you need at what time and what activities and things should they do to make you successful?

SPEAKER_08 48:32

Your first 10 million, it does. And I believe they're I believe they're working on the next um hundred million. Okay. Right, Adrian?

unknown 48:45

All right.

SPEAKER_01 48:46

Well, I will say to that to that, Andrew, I and I talk a little bit about this. Um, I've been a part of franchising um as a whole for more years than I'd like to admit. And and I think that Michael and um a lot of his peers in our top quartile are key examples to understand how we do help you because um as he's giving everybody here um generously his time, he's a net giver. He answers the phone when his buddies have questions, and he's a part of many different masterminds for some of the newer franchisees. And to be able to work with somebody like him and have him as part of your toolbox, I think is incredible. And and a lot of brands and opportunities don't align with that. And so to that point, yes, we're building out the performance that are going to get everybody to um that BHEG of 50 million um in one given market. But for now, in this exact moment, it has always been, you know, 10 million in 10 years, and um, and so many have superseded that that we're having to redraw it. And so that's a really great problem to have. But I think that that that is that human capital inside of our brand is what's really, really spectacular and what helps and has helped Michael and the others kind of follow along, um, the pioneers who have done that and and gotten to those really large revenue benchmarks. So that's just my two cents.

SPEAKER_08 50:17

Andrew, and it does become very apparent once when, like, for instance, in my like I built out our budget, and in our budget, we have certain markers that we hit. So once you have a certain amount, and this is the the other beauty behind reoccurring business, is that once you hit these markers on that recurring piece, for us, it's about 125 to 150. We need we know that that facilitates one account manager. Okay. And then I also know that um for CBS, if I have an individual that can go out and kind of slay um forty thousand dollars of CBS work, I know that that person is a break-even for me. So it you know, the the numbers kind of read through as as time goes on. So uh, yeah, the growth, you know, I'm I'm happy to have that issue on trying to figure that out. Yeah.

SPEAKER_05 51:20

Thank you. Uh Michael, I wanted to uh follow up on something uh you mentioned, which was uh last year was uh challenging year. Yeah. You still you still um was able to achieve growth. I guess you know the the last couple of weeks have been uh you know quite shaky in the markets. Maybe like it's good to get like a sense uh from you, like how how fast does that kind of get to the level of uh decision making on the kind of services that Citywide offers? And what do you see as uh if if you know if a recession was to happen, are you like planning for that? Are you hedging for that? Just would be interested to hear your thoughts.

SPEAKER_08 52:03

Uh, you know, it's too bad that this call is only an hour long because I could uh I could really go down a hole in in all of this, but I'll make it I'll make it kind of short and sweet. Um, you know, COVID was an unexpected time. Um, COVID was probably one of the best times for our business, but it wasn't just it wasn't like every office was able to succeed. Um there was only a certain number of offices that succeeded. And the reason and the rationale behind that was that people were able to adapt. The reality is that this business is a is a needs business, and it's it's never gonna go away. The only difference is that you will have, you know, if something like that were to happen, you would have to figure out how to now leverage market and sell perhaps in a different way. So it's it you're gonna be doing the same thing. The only thing is that the rationale of price and cost may change. Or maybe the product may change, depending on on uh what is happening. So that is never really the the um for me, it's about the selling piece of it and making certain that our sales folks are continuously making those connections and being able to sell some type of product there. And I it has never stopped us. Um, you know, obviously the selling in during COVID was very different, um, but it it it it never changed in a sense.

SPEAKER_05 53:49

Maybe, maybe the the customer becomes uh more price sensitive, so you'd have to kind of accept lower margins, basically, right?

SPEAKER_08 53:57

Perhaps, yeah. Um, last year, our challenges was definitely the tariffs. My territory, um, so I'm in Southern California, and um Inland Empire is the hub for logistics. So we have San Pedro, we have Long Beach, we have San Diego, we have tons of freeways, railways that all dump into our territory. So when the tariffs hit, um, it slowed things down. And so that was a factor. We also had some employee issues um pop up, and that was probably a larger factor um to what happened to us last year. But um, you know, you make your adjustments with our clients. Um, I know that we held off in Q4, uh, Q3, Q4, we held off a little tighter on increases. We do monthly increases to our clients, um, not monthly, every month on an increase, but as anniversary year comes up, we increase. Uh Q3, Q4, we're a little bit more cautious. Uh, the beginning of this year, we everyone got it. And for February, everyone got it. And for March, um everyone, I believe there might be a couple of accounts there that um took something a little less, but uh we're we're back on to our increases.

SPEAKER_04 55:23

Excellent.

SPEAKER_08 55:25

Thank you so much.

SPEAKER_03 55:26

All right, y'all. I want to make sure I'm respectful of everyone's time. So, Colin, I'm gonna have you bring us home. And Matthew, if we don't get to you, shoot me a message, let me know what your question was, and I'll make sure I talk to Michael about it.

SPEAKER_06 55:38

Yeah. Um, so uh Michael, thank you so much for sharing um all this detailed information. And I could tell that you sent your your you spent your career in sales. I mean, it shows. So well done. Um, so just a question for you. Just when you go back to the beginning of this journey for you, what were the two key moments that really kind of separated from you in being in survival mode to you going into scaling mode and really just propelling the business forward?

SPEAKER_08 56:03

Yeah. Well, I I'll give you one. And it was, I think it was uh, oh gosh, uh our uh third convention. Um and I was really down on myself. And you go to these conventions and you see all these people on stage getting awards, and you're just you it makes you feel like crap. And um I I remember um Jeff was about to go on stage and he was off to the side, and I said hello to him in a little bit of small talk, and he asked me, he goes, How are things going? I said, Well, it's just tough, Jeff. You know, it's tough. Um, and he told me, he goes, Mike, you gotta be thinking of this business like a team, right? Um, this is your race car, and you need to put someone in that driver's seat in order to be able to finish and win. And so at that point, I started realizing that he was right. I could be, I could sell to everyone, I could manage everyone, and it was fantastic. But if I wasn't able to lead and coach others to be able to do it, I was never gonna be able to grow. I was never gonna be able to grow. I guess the second part of that is that um don't try to improve what you bought. Just spend the time and do what it says. And I I failed in that probably in the first uh one to two years where I was thinking, oh, I could do this a little bit different. I could shave this off, I could perhaps maybe continue to trade over here instead of just simply getting into my lane.

SPEAKER_07 58:10

Thank you.

SPEAKER_03 58:11

And here you are, a decade plus later, being that coach. Driving that race car, driving like driving like you stole it. It's Adria's favorite line. Guys, this is a great, great hour of questions. I'm so thankful everyone came with questions today. And I feel like you guys hopefully got a lot out of it. Michael, so thankful for your time today and everything you've shared with us. If you guys have any other questions, please feel free to shoot Adria or myself a message, and um, we'll make sure we connect with Michael and make sure that your answers are heard and asked. So thank you so much. Thank you, Michael. All right, guys.

SPEAKER_12 58:52

Best of a lot, Michael. That's a plus. Thank you, Michael. Bye bye.