Matt Jones [00:00:00]:

The transition from being a tradie, a contractor, a technician, or whatever it is you call yourself, to becoming a business owner is a very defining and in sparing moment for anyone. In this episode, we're gonna discuss what that transition looks like in the space of the strategy, the structure, and of course, the practical application. Enjoy the show.

Matt Jones [00:00:26]:

Rob Crop. Welcome back to The Site Shed Podcast. Thanks, mate. Thanks for having me. Good to be here. -- call this the she call this the Rob Kropp podcast lately.

Rob Kropp [00:00:35]:

Oh, yeah. It's so good to be back.

Matt Jones [00:00:39]:

For you guys that are tuning in for the first time, Rob is no stranger to his show. He's been on the a number of times. And, actually, recently, we just completed a series with him, but we've come back today here because we wanted to talk about something a little bit more specific in the space of how you can grow your the profits within your business, free up a bit of time, back with your family, so on and so forth. And it comes in the way that you essentially structure your business. And so what we're gonna be talking about in in the next couple of episodes is essentially how you can apply a bit of logic, a bit of smarts to the existing structure within your business. And more to the point, look at where your business can potentially should potentially be where you want it to potentially be, a designer structure within your organization

Rob Kropp [00:01:24]:

that's got got you something strive towards and you've got some stepping stones in order to get there. So probably you're welcome back. Yeah. Thanks. Kindly wait for today, bazook. I believe this is a this underpins all sustainable growth in a business. So, yeah, I'm looking forward to talking through it. I honestly so

Matt Jones [00:01:41]:

many years ago, the great Mister Al Levy was was on the show, and he was talking to me about organizational structure, and I'll put some links to all those episodes in the show notes if you guys wanna go check that out. But that really formed the pinnacle and attorney point, I think, for me understanding the from a strategic perspective within a business, how important to have an understanding of what your organizational chart needs to look like in order to get the result. And from then on, it's all you know, everything is really falling into suit for us because we understand where we need to go and which means we understand what team we're gonna need in order to get us there at what point in time. And it it was it's quite a simple, I suppose, methodology perhaps in practice, it's a little bit complex if you're not familiar with it, which is, I guess, what we're trying to address here in this in the next couple of episodes.

Rob Kropp [00:02:35]:

Yeah. I'd agree with that. And I think it's think with 2 backgrounds, one of my backgrounds in is in HR, and one of my backgrounds in in the is it numbers, and the financial aspect of my background is numbers is the language of business, but people are the heart of the business. And I think when you get the structure of your business right, that's what unlocks all the growth. Because I think one of the biggest challenges for a lot of business guys is that they hit a point in business, and they just get stuck. Like, they just it just becomes this elusive barrier. And what I find it is for most trades businesses, it's around that Around that $1,000,000 mark, they always get stuck, and there's a number of reasons of why they get stuck. But, fundamentally, if we boil it down, it's because they've they've grown to a point where their structure doesn't isn't conducive to growth, And that's why they can't grow no matter what opportunities are there in the marketplace, what opportunities present them no matter how busy they are, they literally just can't get ahead because because their structure doesn't isn't involved enough to be able to keep unlocking. And so, yeah, I can't wait to be able to talk through and pull it all the pieces to be able to help all the listeners pick it all apart. Yeah. I mean, I think we're defining

Matt Jones [00:03:54]:

moment for a lot of your listeners and viewers out there. And if you haven't come across this realization yet, trust me, you're going to. it's the whole conversation around well, if you if you need to get to this next stage in business, you're gonna have to, at some point, hand things off to other people. And so, you know, that might sound like common sense, but, you know, that whole reality of having a structure around the way that you design your roles, your responsibilities, the positions within your organization, your organizational chart, your, you know, the way all that sort of stuff, it becomes extremely relevant.

Rob Kropp [00:04:32]:

And I think, well, as I say, common sense always isn't isn't always common practice. And I think it's when I think about it when when we distill it down, there's it it's because a a lot of guys get caught in this mindset that The longer and harder I work, the more money I'll make, no one's as good as me, and it saves me time and energy and money if I do it myself. And so what what ultimately ends up happening is they get out of the ground. They might put their first or second trades when on, maybe an apprentice. So they've got 2 or 3 guys or girls working for them, and they can start to start to build a little bit of a team around them, but but they get to that point where they they know they need to delegate, they know they need to relinquish control, but mentally, they're not ready to or they don't know how to. They and that requires them to shift away from an identity point of view, but also shift away mentally, skill set wise, experience wise. It's no longer about being a great tradesman, it's now starting to be a great businessman. And that requires a huge shift for a lot of business owners, because a lot of people got into business because they're very good at their trade, but -- Yeah. -- being good at your trade does not make you a good businessman because they're completely different skill sets. And at some point in time, you have to make that decision where I'm gonna now start running a business, which requires me to hire team because team is the only way that they can absolutely move forward.

Matt Jones [00:06:00]:

I mean, this in truth, Bobby, is the reason that I started the SciShow podcast back in 2016. It's to bridge the gap between what we know as trade is, obviously, I used to be a plumber myself. So, you know, I was trained in how to, you know, lay drains and that kind of stuff. But the that way I mean, going through the apprenticeship in, you know, in the Australian system anyway, essentially, you you go through you do your course and what you've you finished your your licensing costs. It's like, right. Off you go run a business, but no one teaches you about any of that stuff. And so you're right. Like, at some point, bears has to be and and and in truth, once this I think once the penny drops for this like, this moment within an individual in their business, it's an ever evolving state of taking one hat off and putting the next one on. And I think that's just the dynamic of being a business owner. You would never and it and it's also it and it's the advantage and the disadvantage, I think, as well. You know? Like, you you never you're never stuck in any one area. You're always evolving in different things. Like, last year, we spent I spent 12 months building out a HR HRs, you know, recruitment funnel for our business and that kind of stuff. That's great now. But now I'm not in there anymore. Now we're marketing, and we're So you're always doing a different thing. Right? Which is cool because I think and maybe we'll touch on it today, but, you know, the the ability to be able to focus on something, build it out, systemize it, document it, hand it off to somebody else, and then move on to the next thing. I think that's the game. That's really That's the ultimate way to be removing yourself from areas of your business, which can facilitate growth and scale.

Rob Kropp [00:07:34]:

Yeah. Correct. And I think I think we have to fundamentally accept that if if if someone wants to grow a trades business, and it doesn't matter if you're in the maintenance space, the service space, the the project space, You have to hire team. You cannot get around that. Now I know that as well in our client base, we've got someone who sells product in the construction space. they're doing they got a $10,000,000 run rate, and we can count the number of team members on their hands of how many they have. But that's They can do that when we first met this guy. He was doing a $1,000,000 a year. Now he's doing $10,000,000 a year, but he's business from a structures point of view isn't a complex structure because it's all about product in, product out, and it's a very systemized business visits about volume of orders, and so you can do that with a small team. But we got a guy, and we're only on a mastermind call morning with their clients, and he's doing $10,000,000 a year, but he's got a team of 50. And that's because he's got estimators project managers, admin, finance controller -- Sure. -- about forty forty odd people on the ground. And so When when you're running a business that in the trades and construction space, the size of your business is more often not a reflection of the size of your team because when we boil it down, yes, there's materials and jobs, but you sell labor. And so if you wanna build a decent sized business, you have to build team, and there's no way around it. And so -- Sure. -- I think a lot of guys in the trade space get stuck because They're pretty good at hiring their own. They're very good at hiring tradesman, leading hands, apprentices and that kind of stuff. But then when it gets to relinquish relinquishing control and hiring people that, like admin and bookkeepers and PMs and estimators, that's where the hard part comes, and that's why so many business owners don't get over that one ish $1,000,000 mark because anything beyond that is is all about building out operational structure, not just team structure on the ground, and that's why they get stuck so much.

Matt Jones [00:09:39]:

Sure. So, I mean, in this first episode, and we're sort of well into it. But the you know, we're we're really focusing here on, you know, what that transition from a technician or a charity or a contractor or, you know, whatever you can call yourself. is like into a business owner. And I'd say the defining differences there are, you know, that like, as we kinda touched on, know, when you're taking that hat off for the guy that's, you know, climbing ladders and swinging hammers to the guy that's okay. Well, now I'm a little bit more numbers focused and more strategic about what we do about how we the direction we wanna grow or or shrink, I I should I should add. It's not always about growth. You know? I think some people get so caught up in this whole you know, these cliche clickbait things that you see all over Facebook. It's like, grow your trade business or get off the tools. You know? I think, you know, ideally, hope hopefully, in this it'll next couple of conversations. We can we can touch on some of the realities behind, you know, where your strength within your business lies and how you can go about removing all the other stuff that you're not trained in and then you don't consider you're good at. because it's not always about getting off the tools. In fact, most of a lot of our clients, especially some of the builders out there, they want their time to be focused on the job. They wanna be on their managing They wanna be doing that. They don't wanna be worrying about, you know, the invoicing and the payroll and the ordering and all that kind of stuff. So I think, you know, don't don't always get sucked into this whole mentality where you, you know, you get this whole kit off the tools or, you know, whatever it might be. Grow your business, like, I think there's the the strategic conversation behind this really needs to drive, you know, what we're talking about here in the space of what it's gonna take you to

Rob Kropp [00:11:17]:

you know, transition from being a technician into being a business owner. And I'll talk that in through in our next episode when I actually draw out the structure, and I'll talk around the 3 different components and how to navigate that growth. But there's definite sweet spots in terms of what a business owner looks like, and I'll talk in terms of rough turnover brackets and what that structure looks like because there's sweet spots and there's ugly zones. And I'll talk through them because then it'll give the listeners a bit of an idea of where they should be aiming and what steps they can take next to get there because you're right. Some people you build a business that works for you, not the other way around, and you've gotta be able to the choice, what do I want my structure to look like, which is gonna give me the lifestyle that I choose. And so you've gotta design your structure to reflect what you wanna be able to achieve in your business. And some people, whilst they might be good at business, some people just have to be honest with themselves that they just don't want a big business. And so it's about understanding having that self awareness around them to be able to go, well, what are my capabilities? What are my sweet spots? And and and how big a business do I really want, and that's the real good questions.

Matt Jones [00:12:22]:

And you and you know what? I've been in this situation, actually. So when I was probably going through. I I would've been maybe a 3rd year or 4th year apprentice or whatever. And I worked for a I was working for a plumbing company in Sydney, and they had a 100 we had a 100 guys on the books at that at that point in time. So it was pretty big. It was, like, commercial construction sort of business. Great company work for, good culture, good fun. Well, lots of young guys. You know? But we're talking about business owner, and he's and he and I'll never forget it. He said, He goes, Jonesy, I made more money when I was running me and 6 other guys that I do now when we run a 100. And I go and he goes without a fraction of the stress and the headaches. You know, it may cost him his marriage. It cost him it may cost him a lot of things as you can imagine. But, you know, the the point is sometimes the big view is polarizing. You know? And we don't really understand the complexities of it. a lot of people say, oh, we wanna grow the business. We wanna have, you know, 50 trucks on the road. I'm like, go in baby steps because you might find when you're halfway there that that is not the case.

Rob Kropp [00:13:29]:

And I think you're absolutely right, and I thought so I think it's about building the structure that works for them. But I think the the big principle that a lot of guys miss is that the reason why they get stuck and trapped and and, like, caught in their business working big long hours is because they're literally wearing all the hats. Sure. It's the biggest problem, and it comes from that mindset where Like I said before, it's the longer and harder I work, the more money I make. They also think that it saves them time and energy money before they do it themselves. And that's why they have all those hats on. And I know that you gotta think you've got the admin hat on, you got the bookkeeping hat, you got the project management hat, you're The supervisor's hat, the estimator's hat, the owner's hat, you're wearing all these hats. And but the reality is you you you're trying to be all things to all people, and you're sucking at all of them. And so whilst business owners think that they're saving money, what it's actually doing is costing them an opportunity. Absolutely. And in economics, it's called opportunity cost. And so when I'm talking to clients, one of the one of the best things that I get them to do is unpack their week to be able to get them to see where all their time is going, and what that does is help them realize that they're spending their time on what we call as LVTs or low value tasks. And they're running to the suppliers picking up stuff, taking it site. They're coding transactions in their accounting package. They're doing the admin function because They do it because they wanna keep everything else moving along because they treat their time their own time as free, and they spend 10, 20, 30 hours of their week doing all these low value tasks. But when they look at it, they're doing 20 or $30 an hour task, which they could pay someone to do that, at the expense of winning that next strata manager, winning that next job for the builder, winning a big contract. It's worth 20

Matt Jones [00:15:42]:

$200,000,

Rob Kropp [00:15:43]:

half a $1,000,000. So they're spending time to save money, but it's at the cost of their family life, and it's at the cost of the growth of their business. So I think when someone gets their head around that, that they they're thinking small when they think they're saving money because I would rather them flip that conversation on its head thinking, instead of thinking, what can I do to save that? It's gotta be what's that actually costing me? And when they can get their head around that, that's what unlocks their mind to be able to make really good changes from a structures point of view.

Matt Jones [00:16:15]:

it kinda ties into, I guess, like, you know, that whole conversation around knowing what your, like, effective hourly rate is you know, like, working that out because that kind of drives the decision. Right? And, you know, and and then, of course, knowing your labor efficiency rates and that kind of stuff, you know, straight from a old Greg crag trees, you know, bible over here, you know, understanding those numbers really can help you get clarity around, okay, well, you know, why why am I spending my time in the or or maybe not even you to the, you know, more to the point. You know? Like, one of my developers at the moment is hemorrhaging because he's so busy, and it's because he won't create any processes to offload the task that the 2 staff he has. You know? And it's like, you this is just because you haven't done the work to get rid of it. You know? And, like

Rob Kropp [00:17:01]:

so it's not always about you. It's sometimes it's about understanding, okay, well, if I wanna promote this person into this position, then I've gotta get rid of these tasks, things off their plate so they can do that. You know? Like And I think one of the biggest challenges is and I always And I always push this point with clients when I first meet them is that a lot of guys coming to me going, Rob, I need this system, and I need that process, and I need to systemize this, and I need to systemize that. And, fundamentally, systems are important, but systems are in important at a certain size in business. Sure. You can do little systems along the way, but the most important thing I believe is structure. Because when you get your structure right, you buy back time. And then when that time, that's when you got the time to be able to work on systems and processes and efficiencies and optimization. But if you don't have the time, then trying to systemize along the way as a waste of time. And if you don't have team around you, then what's the point in creating system people to follow if you got no one else to follow them. Absolutely. Yeah. I think workflows and checklists and admin optimization, bibles, and all those types of things. Are they important? Absolutely. But they come further down the line. So if any business owners doing half a $1,000,000 a year, a $1,000,000 a year, $1,520,000 a year, sure, get some systems and processes in place But when you're in that phase of business at that size, the most important thing is you can do is optimize your structure, which unlocks the opportunity for you as the business owner to get time back. When you get time back, then you've got the ability to work on your business. and make the changes improve the systems and processes in your business. But don't try and worry about systems and processes up front because, a, you don't have the time. and, b, more often than not, the business owner is the worst person to develop systems anyway. So why not hot? Get the right roles, the right people, and then get them leverage off them to be able to systemize your business for you. The reality is too for,

Matt Jones [00:19:01]:

you know and and to sort of give credit to that comment, like, there's very little point in you as the director of a business. Right? For example, to go and create the the systems or the standard operating procedures for the accounts receivable department. Like, you don't know shit about that. And whatever you were doing previously, you're probably screwing it up, which is why you've gotta hide someone. So you're better off getting people onboarded, finding out where the bottlenecks are, and then creating a process on how to do it. We're going and this is an ongoing evolution with in business. You know? It's very much a case of throwing mud at the wall, see what sticks, and then dial it in with with systems. You know? Correct? So And I think what a a great example of that is, and I was I I met with a a a new client just yesterday,

Rob Kropp [00:19:48]:

on one of our strategy calls, and we're mapping your structure. And these become the basis of how we grow our clients business. The structure conversation is underpins all the growth and and I'll show you on our next episode when I draw out the structure. But what I always get clients to do is go right. Think about your week and show me a paragraph of what that looks like. And this guy's doing just about 100 grand a month. So he's doing about 1.2 a year. And he goes, well, I'm just getting bogged down. I'm just doing all this admin stuff. I'm like, great. Let's go get an admin person. Oh, but what am I gonna get them to do? I'm like, mate, don't worry about fixing their role because that's like getting cleaner before the clean that's like cleaning before the cleaner comes. And I said, let's go to market and let's clarify the role. Let's hire the right person. But let's just not get any admin person. Let's hire someone who's worked. This guy was a sparking. Like, let's hire someone who's worked at a supplier shop or a landscaping business, a construction company. They know what job management systems are like. Let's get a part timer for 20 hours a week who's had experience and pay for that experience, let's get them to come into your business. There goes 20 hours off your plate. You can then go and focus on running your sites better and and and estimating your pricing more work. And then that person can systemize the shit out of their role along the way, and happy days. It's a win win scenario, and so that's why I always say that it's positioned first 1st and second, process third, and you've gotta do it in that order rather than trying to worry about processes first, all the worst mistake is hiring someone and then building a role around that person. Oh, yeah. You've gotta make sure it's always When it comes to structures, you gotta be really, really clear on what's that position that I'm hiring for and really get clear on the roles and responsibilities. then how do I fit a square peg in that square hole and make sure that that person is the right fit for them, then when you get them in, You release the time, and then bang. That's when you worry about growth and optimization within that structure of that person.

Matt Jones [00:21:47]:

So do you, Rob, typically advise I mean, and and if we're jumping into the next episode here, let me know. But Do you sort of start with the org chart?

Rob Kropp [00:21:58]:

I do. Yeah. Absolutely. Always start with the org chart org chart, and The old chart. The old chart. Old chart. And and I always start there. That's always my reference point of how we grow our business.

Matt Jones [00:22:12]:

So if you guys out there that I'm familiar with that, we'll probably give an example of one the next episode. But, essentially, it's a a map which indicates you know, what the positions are within the the business, which people are representing those positions, or which people are currently filling those positions. And and and maybe we'll get into what that looks like down the track as well. So when you've got your existing one, which is your current all shot, and then in order to facilitate and strategize the growth of your organization. Typically, you would have what we call a forecast at Orchard. I'm not quite sure what you call it, but it's basically what the business needs to look like in 12 months if we're gonna get to this target.

Rob Kropp [00:22:50]:

Correct. And I think I think the principle when it comes to current state versus future state org charts is we gotta remember that the org chart doesn't necessarily change from a structures point of view. It's just that as the owner, as the business grows, You take off one hat like you said before and put it on someone else's head. And I think the principle there is is that you when you're growing a business, you don't scale your time. You scale your team. So it's scale team not time. And that that principle is really important to remember because I know within within my business as a coaching company, I've been over 12 years ago and many, many years ago when I was a one man band, I was I had, say, 15 odd 15 on clients, 10 to 15 on clients, and that's a pretty heavy load for a for a for a one on one coach. Now we've got a 120 clients in our coaching organization, and that doesn't mean I work ten times harder. It just means that I've gone from a team of 1 to it was ten of us in the team now. And so in order for this coaching business to unlock our growth and be able to touched the lives of more people within their organization, it doesn't require me to work longer and harder. It required me to build out team and delegate the responsibilities out to my team. And so for the listeners, Growing a business isn't about you scaling time, it's about scaling team, and it gets to a point in business where it's no longer Growing a business isn't about working longer and harder. The success of the business is determined not by how hard you work, but how well you'd lead a group of people around you. And that leadership is all of the structure that you build. And and when a a trades business owner gets that mindset and they go, oh, I can I can run a $1,000,000 business working 80 hours a week or I can run a $3,000,000 or $5,000,000 business and run and work 40 hours a week, then why wouldn't I? And so it all comes it's not about scaling the time you work in business. Your growth isn't a reflection of your time. Your growth is a reflection of how well you build out your team and lead that team to derive the outcome that the business wants to achieve.

Matt Jones [00:25:07]:

So why don't we talk about some of those, like, from a strategic point some of those things that you do need to equip the team within order. Unless we're treading on the next episode, but, like, you know, things that you need to basically equip your team with if you're going to enable them or give them, I should a better the choice of better words, give them the best opportunity to succeed within that position. because I know, you know, recently, we've we've we've got we've gone through this evolution within our own business where and it's not that it's new, but it's just that it need a bit of a refresh and we needed to, you know and we need to dial things in a little bit better in relation to well, okay. let's take the focus off the off the individual and have everyone on the team needs to understand they're part of it of a machine that's moving towards a bigger goal. And, like, one person succeeding in a position over here, what does success look like, first of all? So, you know, what are the deliverables for that job? What's the KPI? Like, what it do they know if they're on track, and how do they know if they're succeeding? because we've all been in that situation before where you go and hire someone and you just that you you want want the golden you know, you want the unicorn. It's like just come and fix all the problems, but they don't really understand what they're supposed to be doing, and they don't really understand, you know, what what what it looks like to be for a win. You know? So that's where you hear things like KPIs and stuff like that coming into play. KPIs don't need to be complex either. It could it could just be a, like, it's your sales team, it could be bringing 2 new 3 new qualified leads a week or something simple. You know? It's just something that you can measure definitively for each person within your depart in in your business. So they know, have you done this, or haven't you done it? Okay. You haven't done it. How do we get you to this point? Is it a training issue? Is it a process issue? is it a personality issue? Are you lazy? Like, you know, like, it just gives you the ability to sort of keep them on track. The other thing is, you know, if we found that and this is probably more relevant to businesses as they grow, you know, like, okay. Well, individuals, okay, you might be performing well, but your department's failing. So if you look at your department KPIs, they're down. Like, yours are up, which is great, which means your team's letting you down. So you need to have that conversation with the team and figure out what's going on there with the rest of them. You know? Then the departments need to understand the picture that plays within the organization, and it gets a little bit complex But the purpose of this is just clarity. Like, you just want the team to know if they if they're heading in the right direction. You know? Yeah. I think from a there's a couple of elements to that.

Rob Kropp [00:27:32]:

Like, one of them from a there's some strategy things, and then there's some soft soft skills that the leader the owner needs to develop. Mhmm. because you're gonna remember, a lot of these a lot of trades and construction business owners, they're very good at their trader. They've they've never learned management skills. They've never learned how to be a great manager or a great leader, and so you gotta develop that. And as you grow a business, I've gotta a lot of trades guys and girls, they spend all this time going through their apprenticeship, getting qualified, building their experience, and then they get into business. And you gotta remember that moment you step into business, you got your training wheels back on again, and you've gotta go on a journey to develop those skills. And so when you're growing a business, you have to accept that that's gonna require you to build out a team, and therefore, you're dealing with humans and people and all the complexities that come with people. And that scares a lot of people, not be and you talk to a lot of old trades guys going, oh, you know, it's just easier when it was just me and apprentice tried to grow, and I shrank it back because it was easier back then. But a lot of those guys have that mentality because they never structured their business right to begin with. and they never developed the leadership and made management capability to manage a good team. And so I think Some of the soft skills that a lot of business owners can learn and develop. Number 1 is delegation, like, just good fundamentals of how to how to delegate good accountability skills like how to actually hold people accountable, how to run effective meetings, not just toolbox talks, the guys on the ground. But when you start building out your operational structure, how do we how do we delegate, hold them accountable, and then have meetings to close the feedback loop? So -- Correct. It's things like it's things like that. It's the ability to how to how to lead and empower your team so you can get the most amount of performance out of something because as you grow out a team, it's you become 1 removed, and it it's about getting the most out of that person for the job that you use to do. So now you gotta lead that person and navigate through them. So it's about performance management. It's about empowering your team. It's holding them accountable. It's all these soft skills that so many Trade's business owners are never learned, but you have to go down that journey to develop those skills because if you don't develop them, your business will never grow past that skill set that you've currently got. And I think that's really important to remember is that your business will never outgrow you. So if you don't continue to develop and grow that leadership capability and management capability, then your business will naturally plateau because you become your greatest limitation for the business's success.

Matt Jones [00:30:23]:

And and and as important as that is, it's also important that you start developing leaders is something that I've noticed, you know, and and kind of done okay at, but you know, there's you know, be understanding or if I need somebody over here to run this part of the business, they need to also have leadership qualities that, you know, team members can follow. So it's it's not the I suppose the principles are the same, but, you know, again, as a business owner, you kinda got take the blinkers off and zoom out a little bit to look at the bigger picture, which is very hard to do sometimes. This is why, you know, having allocated strategy time in your calendar is important. because it gives you the, you know, the ability to zoom out a little bit and to take a bit more to to focus on these things that are important and often get neglected.

Rob Kropp [00:31:10]:

you know, you you how many times do you hear a trades? Trades owner say, oh, my best apprentice has turned into my best tradesman, and And I've still got my first apprentice, and he's been with me this whole time. And that's because, yeah, because you spent time developing that apprentice. And so -- Yeah. So same thing all the way through the organization. You wanna be able to get to the point where you're you're always developing your you people within, and that's why I love about growing a business is that it gives people career paths and you develop your apprenticesces to be good tradesmen good tradesmen to become good leading hands, leading hands to be future estimators or project managers. So you're developing your team from within, and that's generally the best way to keep growing a business because you've got you you can build it from the inside out. and the culture becomes really strong rather than always bringing outside resources in.

Matt Jones [00:32:05]:

So where are we where are we let's let's maybe take a step back here and let's say, you know, there's a listeners of yours out there that are, you know, 1, 2, 3, four guys, and they maybe wanted to get to 10 or whatever. Like, why don't we start from start from the the base layer here as to where to start and how to sorta get that movie for them? Do you want me to transition into drawing out the structure? Are we gonna do this in the next episode? because if so, we can we can wrap this one up and we can come back we'll come back in that next episode, and address that. Let's wrap it up, and we'll do it up in in in the next episode. Yeah. Okay. Been of a cliffhanger there for you guys. But, essentially, I I think from from my perspective, like, what you guys there's a lot of information about this stuff out there is available. And and in truth, You need to be in a position, and this is the god honest truth. You've this you've gotta get yourself into a mindset where you want to learn these things. Because if your mindset's not right and you're not wanting to actually educate yourself in this you could listen to every podcast and read every book on the planet, and you won't absorb any of it. And so it really does take, like, a penny drop moment for you to actually make that transition within your own head. And once you've done that, once you've lowered that barriers of resistance and you're willing to sort of take on council, You'd be amazed at the sort of insight you can get through, you know, coaches and books and podcasts and all these kind of stuff. I mean, there's just a plethora of them which I could throw at you, which I'm not gonna But the point is you gotta be willing, and you gotta want to actually and and and be accepting of the fact that what you currently know within your business is not gonna get you to where you want to be based on the fact that you just haven't you just don't have those skills and you that's not a negative that's not an attack on you. Like, you just never learn them. You can learn them, and you will learn them if you want to. But you just it's just not part of our system when we're growing up in the trades. So don't be afraid of it like embrace it, and and you'll be amazed at the results.

Rob Kropp [00:33:59]:

And I think saying taking that another step further is and until the reality is, is that general stats that have ah, and these stats might be a little bit older, and they were pre COVID and everything. But stats are that only 6% of businesses in Australia turnover more than $2,000,000, and that's across the board. Stats pre COVID as well were what almost about almost 1 in 2, so it was about a sixty-forty split of almost 1 in 2 businesses are profitable and the other half are breaking even or worse yet going backwards. That was pre COVID days. They're pretty alarming stats that you gotta be only 6% of businesses turnover more than $2,000,000.

Matt Jones [00:34:51]:

Yeah. But then you've also got take into consideration like, this is the whole conversation around turnover versus what's leftover. You know? Like and I and I often encourage guys not to get too caught up with know, turnover. That's why we put so much emphasis in our business on net profit ratios and percentages, you know, not just dollar value, but the percentage because like, you could be turning a $2,000,000. I mean, I mean, you look at some of these multi huge corporations that are turning 1,000,000,000 or 1,000,000,000 of dollars, and they've, you know, they've got a, you know,

Matt Jones [00:35:20]:

0.10

Matt Jones [00:35:21]:

percent, you know, profit or something. Like, you're gonna have a it's this exactly gives credit to what I was saying before about the company, the plumbing company where there were, you know, a 100 staff, and they were making less money with a 100 staff, and they were when they were when it was 6 stuff.

Rob Kropp [00:35:37]:

Like, I think you stopped -- You are right, but it we gotta remember, for the most trades businesses, they they they make 10 to 15% net. And so unless you get to a certain size, it's actually not worth it being running your own business. I'm a big believer of that. Most people who run 2 smaller businesses would be way better off going and becoming supervisor earning the 120 to a $150 a year, having holidays and not carrying all the stress and pressure and risk that they're carrying when you run a micro business in the trade space. And so it's a big part that you gotta remember running a business is a is a is a big big risk. It's a big obligation, and a big responsibility, because you gotta be able to look after your family, and in my opinion -- -- change families. Sorry? And your team members' families. What's the point in carrying all that risk if you're not gonna be remuterated and rewarded for it? And so I think We'll talk about it in the next in the next episode around the structure, but I I believe some most trades business have to get to a certain point to make it worthwhile for them. Otherwise, they just never get out of the day to day grind because they're just so sucked into that grind because of their lack of structure.

Matt Jones [00:36:51]:

Mhmm. Cool. Alright. We're gonna come back, guys, and we're gonna talk in the next episode about a bit more practically what this might look like. you know, and and visually as well, Rob's gonna share some drawing and things like that on on what this might look like. So if you guys are tuning into this episode via audio, that's cool. The next episode, you may wanna head across site show's YouTube channel, and you might wanna watch the next one or head across to the site show dot com, the video will be embedded on that. So if you wanna follow along and actually see what we're gonna be talking about there, might make a little bit more sense, but we will do our best to try and make it as audio friendly as possible. Anyway, thanks again, Rob, for joining us. Rob's from Pravagroup, pravargroup.com, and he's been on the show many times. I just head across to thescishow.com and search Rob crop, and you'll it's with two p's, and always podcast will pop up there. Alright, Bobby. I'll track this up. We'll come back in the next one. Thanks, mate. See you there. Ciao. Thanks for tuning in guys. Please hit that subscribe button, get your notifications

Matt Jones [00:37:54]:

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