David Hammond, the owner of Hammond Services, talks to Jack about the tough lessons he learned when he walked away from a winning business formula.
David Hammond, the owner of Hammond Services, talks to Jack about the tough lessons he learned when he walked away from a winning business formula.
Okay,
Speaker 2:Jack[inaudible], welcome to another episode. Leadership Lounge Lounge.
Speaker 1:I'm in Saint Paul, Minnesota. Today's beautiful day, early in the morning and sitting across from me is David Hammon. How are you doing David? I'm doing fine. Jack. Good to be here with you. Beautiful Day out there. Yeah, great view from up here. Thank you. It is view. It is beautiful. And I feel very grateful to have this office. I can tell you that. So, and I love doing this, right? And thank you for agreeing to do this. I, I saw your name on a marketing planning workshop roster and I can remember talking to you and your wife Lisa, right? Yes. Yep. When you guys came in for a leadership mastery about your story, and I thought this might be interesting for you to share that. Right? Okay. So, okay, so I had to be here. Let's give everybody just an idea snapshot of Your Business Right now just so people kind of know where you are and kind of rough size, that kind of thing. So tell us about Hammond services. All right. Him and services were located on the south side of Atlanta and we are in Griffin, Georgia, um, about 10 miles south of Atlanta Motor speedway. Uh, it's, I like how it's positioned on the south side. Uh, we don't go above 20. If you're familiar with Atlanta, we don't go above the center of Atlanta. We stay on the south side or um, do it purposely. Um, cause it's a good market for us and we don't run into, uh, a lot of the guys on the north side, the bigger contractors in Atlanta tend to focus on the north side. South side seems to be a good niche for us. We do heating and air, plumbing, electrical. We currently have about 85 to 90 employees. Um, our mix of work is HVHC plumbing and electrical and plumbing and electrical are about the same size. I mean plumbing in HPAC are about the same size. Electrical is probably about 10% of our business. Okay. And then is, it's all service replacement? It's not, it's, no, uh, historically for, we've been in business since 79. My Dad started it in 79 after he retired from the air force. Um, I came on board in 92. Um, but we have been HVHC plumbing most all of those years and we brought on electrical about 20 years ago. Okay. Um, as far as a size, we're currently on the existing market service business add on replacement market. We're about to 10 million a year company. Okay. And then we do about three and a half million in new construction commercial. Okay. All right. Well there's, and that's new for us. Yes. New Fans. The story there. Okay. So, um, just, just as a, uh, and I'll set the, the tone here. All right. So were in a leadership
Speaker 3:mastery class, you and your wife Lisa? Yes, she was this winter, I think it was just last winter. Yeah. And, uh, I was one of the instructors and I've met you, you joined recently, like in the last year. And just, just as a point of context, do you remember years ago, right when our name was contractors? 2000. Right. Then you drifted away from the organization and in you rejoined, um, last August or September, is that right? That's correct. Yeah. So anyway, I say all that because you were in one of our entre leadership classes, leadership mastery, and I was instructing that class part of that class. And one of the, the, the pieces of content that I get to teach is the first of our eight laws at double digit profitability. And one of the, the first of the eight laws is what we call work the model and the model service replacement. And uh, I started talking about what defines the model and what doesn't define the model. And almost like spontaneously Lisa erupted with it almost like a Hallelujah. Like where are were you? Where were you two years ago? I can't remember. I can't remember the context but, but she got really animated and it was a respectful, kind of a joyous statement, but you could tell there was, it came from a lot of challenges. Is that fair? That's fair statement, yeah. Okay. So you guys had drifted your, you were a service replacement contractor and then all of a sudden you got into to a, some commercial construction. Is that right? Yes, we did. All right. So let's do this. Let's go back to why a relatively successful company would decide to do that after 30, 40 years of existence. Right. Or however long it was. More than that. Yeah. Tell us about that.
Speaker 1:I think, uh, we became more and more successful and our exist in market and I felt like that to a certain degree, uh, we had, I wouldn't say plateaued, but we, our growth had slowed and our cashflow was very good. Profitability was very good. Um, and of course being the entrepreneur that I have deep down inside of me, which as a kid, even as a little kid, I was selling Christmas cards when I was to, to neighbors and cutting grass and all kinds of stuff. I've always been an entrepreneur and I think that is to my own demise at times because it, it, it can be because I, I saw some opportunities in our market for a lot of new construction, commercial work going on and a lot of it was hotels, um, like best western, uh, Hampton eons, things like that. In our market. There's a lot of that going on and there's a huge need for subs. There's a shortage of, and so, um, I thought, well, you know, obviously there's contractors, that's all they do and they are somehow making it successful. Although I have never even done new construction residential, but I felt like, well, this is a bigger game. You got to get bonds. You got, yeah, it's things like that. So I figured that a lot of the low hanging fruit as far as some of the contractors that would, it wouldn't pass the cut being able to get into it. And so it'd be kind of a higher level of competition thought we thought it would be. And I found out, uh, you know, you, of course you learn things after you go through experiences. And of course, what do you do with that information after you go through it? But, um, it's not, it's a, it's a, it's a totally different world out there and new construction commercial. Well, let's, let's talk about this. So I wanna cause there's more to this story I think. So you had obviously an entrepreneur, we get a little bit bored with that, doing the same old thing and kind of had an itch. Is that what it is? I don't know if I was bored because I've always, I love what I do, but I think I, I I like a challenge. And so, um, maybe that was it. I don't know. I don't, I really don't know. I'm looking back on it and I saw where I did a few things before I pulled the trigger on this. I went and I invested in a cured in place, pipe, a trailer, uh, that we bought the whole set up. And we do cured in place pipe where you don't have to dig up the sewer lines, but that's, but that's replacement work. Yes. Replacement works. Uh, and I bought a big, uh, jetter, uh, real hot powered jet or pull behind trailer, you know, those things run about$70,000. Um, I was, I was investing in things that would add to our existing market services that we can offer. Um, those are good investments. Those are good invest part of service replacement, right? Yes. And I met a guy, uh, that, uh, I, I knew his wife real well, but he worked as a business development, uh, person for our it company that we used. And He, I had invited him to play in a couple of golf tournaments, uh, where we, you know, we sponsored these golf tournaments and these teams and stuff. So we're constantly out there, uh, promoting the business and playing and having sponsoring holes and playing on these, uh, teams. Yeah. And we talked and he was big on federal contract work and uh, new construction, commercial work. He had a lot of contacts and a lot of general contractors and that's all he's ever done in that world. Started a romantic romancing you a little bit, did he? Yeah, he was kind of not, I didn't really realize what he was doing, but we, over a period of two years, I finally had him come in and we talked and we sat down and he said he could work with the equivalent of one day a week and then there would be a commission on anything that he brought in as far as work and very small commission. But you know, for large contracts that adds up. So, uh, I went ahead and gave that a try and just tested the waters with it and he was really good at what he did as far as bringing in the work and bringing in the opportunities and it was up to us now to bid to work, you know, figure up the cost estimates and everything and then perform the work. So he was bringing you these opportunities yes. For these hotels as an example. Right. And he'd say, Hey, these guys are accepting subcontractor quotes on this and he had this, this is a good opportunity. Right. That's what he did. Yeah. The first one that we got was one right in Griffin. And, uh, you know, it was very attractive to me because it was, um, you know, literally three miles away from the shop. And I figured, well that's a great one to start out with. But I told him, I said, hey, this one here, he said, why didn't you guys bid that? And I said, well, you know, we weren't doing it that time. And I said, they've already taken bids. I said, it's too late. He said, you know, he's got enough experience to know. He said, it's never too late. So he went in and approached the general contractor and the housing authority. There's, this was one of those housing authority, federal funded projects. And he went in and said, we'd like to negotiate with you. You know, even after the bids have all been given, they hadn't awarded it yet. So since they hadn't awarded it yet, he had enough knowledge of that world to say, we can agree, we can still possibly get in there and negotiate dish because we're a local contractor. And the ones that they have gotten the lowest bid on is end even in a different state. He said, so we got, we got an opportunity here and he was right. And then we ended up getting in there and negotiating and getting that project, which I was real pleased with. This contractor was a, a pretty good contractor to work with. I happen to know the contractor, they're out of Birmingham and one of my best friends from high school, uh, actually worked for them as an architect. So I called him up and I talked to him and I said, what do you think about this, this company that you work for? They've got this project in Griffin. He said, man, we're, that's all we do is we do multifamily housing and a lot of dormitories for colleges and stuff like that. So, um, I felt good about that general contractor because I had somebody inside that that knew them well. So we went with the first one that we took and took it on. They would go, okay, that one went okay. Um, that one did a, we got into a high rise, uh, about a couple of months later in Atlanta was the mandarin hotel in Atlanta. And, um, low about the first 20 or 30 floors. It's a hotel. But after that it's condominiums up above it. And a lot of wealthy people buy like a whole floor. Think one of the singers, pink lives up there. Matt Ryan has two floors. The quarterback for the Atlanta Falcons. Okay. So we got involved in that and um, we, we landed a plumbing job to the north of[inaudible] and it was north La$28. We go, there we go. We're violating. Yeah, that's all right. Bars, winter. So of our geographic areas. Um, so we took that on and my God, that was a money loser. Uh, we bid it as if we were going to be, you know, relatively efficient doing the job, but we did not understand how many delays we were gonna have the security just to get up, up to the floor. You had to work on, what were you doing in air conditioning plumbing in there. You were doing air conditioning and plumbing. Okay. On that. And we were finishing out several floors and the architectural standards that, that then the engineering standards that they were pushing were so stringent. Um, there was one time where a whole week went by where pink, I don't even know who pink is, but sh some artists, music artists. Um, they said we couldn't hammer, we couldn't drill, we couldn't make any noise that paint needed to get her sleep and, but yet the general contractor was still requiring that we be there and keep, keep on schedule. Would you do with a velvet hammer or what would you we weren't able to do hardly any work. Yeah. And our guys, um, one day on hold on one project, our guys didn't follow protocol and of course it's because this is not the world we lived in. And so he had to make one solder joint on a copper fitting. He lit his torch, made it that quick and it set off a whole fire alarm in the whole, uh, high rise. And so the whole hotel had to evacuate. We got, I had to go down and meet with, uh, the, the owners of the mandarin and the general contractor. And they were talking about serious financial fines and things like that with us just for that one incident. And of course there's a protocol. You're supposed to go through a Firewatch procedure and notify them you're going to have a fire. So if an alarm did go off, they would know where it was and that no, this wasn't something you're going to evacuate the hotel over. Um, that's just one small little example of the kind of trouble you can get in real quick if this isn't the world you live in. And, um, yeah, just, it's always, so, yeah, it's always just as business development guy, um, who estimated this work. I mean, cause he didn't do it and you never did it. So I mean, so now you're putting it on the, on the line. How, tell us about that. What I got is I've got some guys that got, you know, some of the guys that I have been with me a long time. Yeah. And they're, they're department heads for the different, um, disciplines. So I got up, I got a plumbing department head, I've got a vac installation department head and I've got a very experienced electrician that up, has managed huge projects before. And so, uh, they all, you know, had the working knowledge but never the estimating knowledge and show. Basically, I, I'm an engineer by degree and um, I've done, I'm a civil engineer by degree petroleum engineer by trade. And then I came into the business. Um, to me estimating is, should be fairly simple to me and uh, but, and I, I, I checked their work, but then again, you know, unless you go back to square one and go through everything and look at the plans with them and go through it, there's a lot of stuff that can get missed. And also in the contract languages, these contracts are long and wordy and there's lots of provisions in there that can get you in a lot of trouble real quick. And I'm just, I didn't have lawyers reviewing the contracts or anything like that. A big with these contracts. They were, um, probably the average size with about 700,000 per trade contracts. This is two jobs I've seen so far. You've got the one job that went pretty well, there was three miles away, then you went and went in the inner city of Atlanta, Mandarin. And that was, that was your second job. Yep. So they need to probably say that that wasn't so bad. I'm just going to quit it. No, I thought, I felt that was a fluke and I said, well, so we did a, um, a job for the, uh, department of natural resources, the state parks in, in Georgia. There was one called hard labor creek and they were renovating 10 cabins. And so we did electrical on those total rewires on them. And my electrical, uh, supervisor at the time bid it as if it was residential, new construction. And it was definitely, he didn't look at the plans very close. He just, he remembered his years of doing it and how fast he could do a house and all that. Sheet rock was up, all that stuff. Yeah. He, uh, this was one where when we'd got through job costing and it was over, we overran that by like twice what we estimated it was terrible. So then you had your third job and you quit it then? No, no. Okay. No, we still wouldn't. You've got this sales pipeline and that is a very[inaudible] decision's development guys bringing all this stuff doing in the sales pipeline in the whole time. We're, we even got a big plotter printing out plans. I got hired a person to just print plans and be an assistant for the commercial division as far as a project manager or assistant, um, plant printing out the, uh, the specs and fighting for you did was this, they all, not the losing money part, but the binus stuff and building it out and cause you know, you're, uh, you're very fit man, but you're not spring chicken, right. You're more mature, you're more mature. Right. You know, it sounds like a 35 year old guy, not a 50 plus year old guy. Yeah, that's, that's part of it that I've had to realize is that, uh, this would have been something and if I was 35 or something, I probably, um, could have wrote it out a little longer, but it's Kinda like, uh, you know, here I am, I'm 60 years old. So how many, this was just a couple of years ago, right? Yeah. So I'm 58 when I started doing this. And, um, you know, it's kind of like a risky, like investing in risky stocks. You don't want to do that when you're 60, uh, putting, I need the money in a couple of years. Right? Yes. So, uh, so the, the realization is now that, um, we're, you know, winding down out of this is not a simple task either. And these aren't one day jobs or, no, we're still, we still have three projects that are ongoing, but all three hit their peak, uh, in mid May. Okay. That's our busiest season. The whole reason this was attractive to me was that it could diversify our, our workload. So, you know, similar installers in the wintertime over on this work. Is that what you're thinking? Yeah, I've started that work, did it, it didn't work. They ended up, we ended up finding places for them to go and then we weren't really managing them. Um, so, and he did a efficiency was just terrible on these jobs. Um, we, we lost money on just about every job we did and we made some on, on a couple. Uh, but when you make some, you're making what, 20% margin if you're lucky. Um, if the you execute them well, you're going to make 20, 25%. That's gross margin. Gross margin, Julia. Yeah, yeah, yeah. So it's, it's really, uh, when I sat in on that leadership mastery course and those basic claws that you, that you started regarding rattling down one day jobs, one day job, get in, get out, get Pale Ar. Yeah. Uh, I'd said, you know what boyish, I assure we have always stuck with that for 38 years of, of business. We stuck with it. We didn't even do residential, new construction. And here I am, like going out into something that, uh, totally contradicted everything that I knew to that point, to that point and how to be successful. So, and I remember being in a mixed group years ago with a guy in economics group. It was an ACO, Mexico. And, uh, he was, uh, in south Georgia and that's all he did was new construction commercial. And, uh, but that's all the, that's all he knew and that's all he did. But when we were in that mixed group, I remember, and this was probably eight, 10 years ago, and I remember him sitting down and he goes, he looked at me and he said, boy, he said, I wish I had your business. He said, I wish I could get out of this. He goes, I've got so much money tied up in retainage and, uh, all this stuff. And he said, I would just love to have a business where I guys got in. I got in, got out real quick, got my money and go on to the next one. And he would very envious of what I had. And, um, you know, but to a degree I was envious of what he had. Why is that? Cause it's big. Yeah. Cause it's big and it's kind of exciting and um, but it's not worth it. Yeah. If you know the model that next door has is a model that will work and it's consistent and uh, if you just work the model, it's gonna work. Yeah. And I got away from the model so you know, but so what are you doing now? We're going to be one and down. Uh, the three jobs that we've got. Um, we're gonna, we'll be finishing up, finishing them up. We're finishing the roughs on all three simultaneously. Um, one project is both electrical and plumbing in McDonald's, which is real close to where we are. And then one is h vac in Warner Robbins, which is about an hour south of us. Um, but those are all gonna finish about the same time. And so we're not, when we don't have, we haven't printed a set of plans, uh, with that plotter that I talked about. We haven't sprinted a set of plans and[inaudible] in the lake. Cause what you should do that. So you know, take that back to your truck, don't the lake. Yeah. So now we've got a few that, um, we have not yet been awarded and whether we'll take those contracts or not, we probably won't. There's a couple right in Griffin with that same contractor that I talked about, they've got, uh, so you've asked bids on the streets still. We did come from in their apartments that are being gutted and it's, uh, it's just HVHC change outs is all it is. So I'm still a little tempted to try that because that's just change outs. But then again, there's a part of me that says, nope, I need to cut clean and get on out of this and just do the residential exist in market, like commercial resistant market, uh, add on replacement and service. And that part of your business right now is about$10 million. Yeah. Yeah. It's doable. It's just this curious why would you, why would you continue to do it? This is these, I'm just fascinated, right? Cause you, you know, your wife, you know, was very animated and she's a wonderful woman. Right. And you guys seem to be a good, good team together cause she comes up here with you, she's very engaged in our training. She's with you this week. Here she is, you know, Wonderful Lady, you know, just seems to be really enjoying the business. Right. And uh, your partnership. Um, why would you, why would you even do the next job? Cause every, because, let me ask, let me ask, say this, that every construction job that goes south always starts as a great job. I know, right? Cause I've experienced this in my prior life is that we, you know, we took some, usually it comes from an employee says this is a can't miss one David. You know, I got to tell I've done jobs and then we can put, this is gonna be nothing but money and you get involved in, you know, oh my gosh, I had no idea. You know, something happens, there's a, there's a, uh, job complication that that adds 50% of the job and you'll lose people. And now it just seems like it always goes bad anyway. Every terrible job starts out to be a great job, know. Right. You never walk into a thing, this going to be bad. So, but that being said, why would you do it?
Speaker 4:Okay.
Speaker 1:Probably won't. Yeah. Um, so, and that's not, that's not a definite that, that's not a definite no, but, um,
Speaker 4:okay.
Speaker 1:I think I was learned in, um, and early on where I had some special deals, worked out with my suppliers. Okay. And
Speaker 4:[inaudible]
Speaker 1:you know, we were getting personally some, uh, bonus checks okay. For different volumes of purchases.[inaudible] and, uh, the, uh, HVHC equipment manufacturer, uh, worked with us directly and that purchasing power and all that was adding up. They, we, we had our vendors to where we were, um, they were all accepting our American Express and we were getting, we were racking up, you know, half a million points a month, uh, and things like that. And me and Lisa Love to travel. So there were things like that that were going on that were blurring my vision as far as the bigger picture. And, uh, okay. So I was, uh, there was some motivation there that I thought I was being smart and I thought that, hey, this is going to be great. You know, uh, all we've got to do is make a 20, 25% margin. At least we'll cover our overhead and we're going to get these checks on the back end. Got It. And, um, but boy, it hurt us way more than what we were being benefited on the back end. Yeah. So, uh, I got sucked in a little bit there.
Speaker 3:So, so is that still a temptation to do it again? Is that what I'm hearing? That,
Speaker 1:that uh, there are several deals out there on the table that, um, I will probably fall short of and we'll miss those targets if I pull out guy. But then again, uh, you know, sometimes you gotta look at it and weigh it out and does it make financial sense or not? And it doesn't make financial sense really. Yeah. So, yeah. God, I don't know how many members out there have gone down. Yeah.
Speaker 3:Rode her a lot over the years. Okay. Fewer, yeah. In Luke. Can I speak though for a minute?[inaudible] I'm gonna throw you some shade here. Um, you know, you're in Atlanta and uh, you're a profile name and I, and I know there's a sorta just sub. So people are knocking on your door. I know they are. And you see this work going on around you, right? And sometimes it's hard to say no, isn't it? Yes. You know, and, and you look at it and you know, people are begging you to bid the work. You know, you're not chasing them so much. Maybe Your Business Development Guy, you know, but so I, I, I know the temptation and you've got people internally that you trust and they'll probably work good people or aren't good people and they were encouraging you to, right? So you've got all these, these forces that come to bear and then you go back to your entrepreneurial thing and uh, whether it's boredom or whether it's just the excitement of the chase or starting something new and feeling, you know, you've done something. There's a, there's a, a routine to our business and it's a good routine cause it creates money. It creates cash every day. But let me tell you that the temptation that I felt as the CEO next door is enough, unless I'm endeavoring to do new and dramatic things, I'm not doing my job. And sometimes you can feel like maybe that's what I'm supposed to do. Maybe I'm supposed to do some different kinds of work. Maybe that's, you know, I'm supposed to take next door in a different direction or a new, you know, a daring being a daring leader, you know. Um, and all of these temptations come to bear. I can see that with those, that cocktail of entrepreneur feeling like you're maybe not doing your job if you're not pushing the envelope, trusted employees telling you could do it. People begging you to take it. Yeah. Right. Yeah. And
Speaker 1:you know, I read a lot of books and um, listened to a lot of different podcasts and things like that and I follow a couple of people. And, uh, Tony Robbins is one that I like a lot. And, um, I can remember being in the midst of all this and it not looking good in us, and I would just so determined to make it work and be successful at it. Cause I felt like if there's, there's gotta be some people out there that are successful[inaudible] and there's gotta be a formula for this. So, you know, I'm still, you know, competitive by nature and everything. So I'm, I'm thinking about this saying that, uh, Tony Robbins has said, if you want to take the island, you've got to burn the boats. And, um, so it's an old Norwegian saying, by the way, is it? Yeah, go ahead. And you're committed and, um, and you're not, you're not going to accept you're gonna, you're gonna, you're gonna win this battle no matter what, and you're going to commit it and you're gonna just burn your boats and you're going to just move on and go, and there's no turning back. Um, so I was in a phase where that was my mentality and I, okay. And I was just so almost if you, if you, if you pulled the plug, you'd be at loser or you'd be, Eh, uh, well, you know, I'm not, I'm not too too proud to, you know, learn from my mistakes either. So. Yeah. And I'll, I'll, I'll, I'll, I'll pull back and, uh, you know, adjust. Yeah. And, uh, but it's still, it's even when I made the decision to go into this, I don't think Lisa was, uh, too keen on it.
Speaker 3:She, yeah. She, she wasn't, are we doing this, you know, because it would be, by the way, our best year we ever had was the year that we started.
Speaker 1:You went into this. And, um, so, um, you know, we were definitely getting where we needed to be and we could have continued down that road and, uh, we would be in much better shape right now. Um, last year was a financial disaster for us and it's, it can all be attributed to commercial. Okay. So we're gonna, we're gonna need to, uh, you know, definitely change course and get back to the nextdoor formula that works. Yeah. So
Speaker 3:that's an interesting, I love that because you know, you can, as a leader, you know that, that, that they didn't algae, it's an old viking analogy, which is, you know what they did, the vikings would attack a, a new country. They would land on the shore and the first thing that captain and do is burn the boat and see if there's no retreat. We've gotta, we gotta, we gotta conquer right now. Right? So that's the whole thing. So there's, that's, that's a good story. Of course, the good book says pride Goeth before the fall too. So I don't know who you want to listen to right there, Tony robins or that. But uh, so part of that is that, that, that what made you successful in your business is determination, know, you know, perseverance,
Speaker 1:pride, you know, all these things that that created a wonderful, wonderful business. Um, but those are also be the things that if you're not in the right market, doing the right things, can I think if we stick to the stick to the model, um, and you know, put the pedal to the metal, but stick to the model and be just as determined, uh, with that and not deviate. Yeah. And, and get out into some of those areas that can really hurt you. And, um, you know, we, when it's all said and done, we just had our[inaudible], our financials. Um, and we have, we, we do reviewed financials every year. We do. Yeah. And, um, so after it was all said and done, those were just finished before I left here. And I looked at him and, uh, you know, we're looking at about last year, about$600,000 loss. Yeah. So that's just, uh, you know, for a company that historically we never had a year that we lost. Yeah. Uh,
Speaker 3:well fortunately you had a lot of good years so that you can, you know, just learn from this. You know, cause there's a lot of companies that's, that's the, the last year of business. Yeah. And that's not you guys, cause I know you're strong and you know how to make money and yeah,
Speaker 1:you, I'm sure you got a Lotta, you know, reserves for that kind of thing, but still it's tough. Yeah. And we're, we're finishing up the projects that we've got going. So, um, we've been through the worst already, so we're winding them up. We know where we're at financially on them. Um, we're not going to lose money on them. Go ahead. We're at least going to break even on them. Okay. But we're going to lick our wounds and get out of this and uh, you know, he'd gotten better because of it. Yeah.
Speaker 3:So looking back, so let's summarize some advice that you can,
Speaker 1:we provide people listening here. If you'd go back, uh, and I would love this question. Go back to that 58 year Dave and Hammond and say, all right, these, these things are coming here. What would you tell them? I would say no, I'm going to, I would, I would, I would sit down and say, look, you've got a few minutes. I want to tell you my story. And, um, and I would say, look, this is an area that unless you really, uh, are prepared for a, uh, potential, uh, losses, big losses, uh, you, you don't need to be getting into this and you got an exist, you gotta if you look at the next star plan and look at that, why wouldn't you follow that? Yeah. That, that formula has a lot less risk associated with it and a lot more upside. Yeah. So
Speaker 3:you're in Atlanta. Yeah. Which is, you know, sometimes a contractor might feel constrained by geography and you know, we can debate whether that's right or wrong, but you're not in a 30,000 person market. You know, Atlanta is what, 6 million people. Yup. Whatever it is. And you could theoretically, once you've saturated below eye 20, it would be maybe easier to go north. I[inaudible] with the model versus, you know what I'm saying? It would be, yeah. Yeah. So you've got a great opportunities when I'm saying, right. Yeah. You know, and I know you know how to do it. And, and uh, you run a great business. Congratulations on what you've built there since 19 years with your father and use since 1992 just developed a great service replacement business. Yeah. We're very blessed. Um, my dad started it and that to me, that's the hardest part of just getting a business started and getting it off the ground. Uh, he retired from the air force and, uh, and did a really good job. Him and my mom, they put a lot of blood, sweat and tears into that and got it going. And, um, so, uh, it's, it's been quite a journey. Yeah. And, um, so you know, you, you go through your experiences and you learn from them and as long as you learn from them and, and make corrections and, uh, become wiser because of it, you know, you'll, you'll come out out. Right. Well, what I, here's what I see. I see you and Lisa, uh, up here to, to at our marketing planning workshop that's learn how to market your service replacement business better. So you're making that investment. You're going to grow that side of the business. You've learned from this. You, you know, you've got a great business, uh, and you know what, you're not bitter from the experience, you know. No, I don't. You got a great attitude about it and I find my 600 grand. I, I wouldn't have your attitude, man. I have your money. A bit of pride. Uh, you know, it's Kinda Ding my, my pride a little bit. That's okay. But I, I'll, I'll dust myself off and, uh, I, I'm generally a very positive person can tell. Um, and I roll with the punches. Um, it's not what happens to you, but it's how you handle what happens to you and, uh, what you do with it. And, uh, if you get, you just get wiser as you, as you gained that, those experiences and, um, they're not all going to go good. But if you can learn from and get wiser and move on, that's the, that's the key. Well, you know what, that's a great thing cause I, you know, it's, it's great to learn from experiences when I love about this podcast and what I love about Nexstar is that, that we accelerate wisdom that hopefully there's some 30 year old, 25 year old guys out there and women out there that are listening to this that are gonna say, well, okay, maybe I don't need to touch the same hot burner, David Dead. You know, I'm feeling that those same temptations, I'm feeling that same pressure. I've got people begging me to do something different. I've got my people tell me it's potential to do it. And I've got a maybe a personal desire to maybe a little board, whatever that is, whatever that that motivation is. And, and, uh, you know, if people can stick to what they're, they know works and just expand that rather than trying a completely different business with a completely different business model, a completely different flywheel, if you will, and to stay there and build that, you know,
Speaker 1:returns compound. And now, uh, here we are and in the next what too much. I will be winding down this side of the business and I'll have a surplus of very talented employees. Oh. Which in this day in time, that's unheard of. So what I need to, I, what I need to do over the next couple of months is figure out how I can capitalize on, on that asset because I've got a very good group of top notch talent and they can do residential just as well as they can do commercial. These guys can do both. Yeah. And so I'm gonna just have, if I do downsize, which I probably will have to do, um, but there's a side of the business that I'm very interested in learning more about it. Next story as the sewer sales side of it. Um, we're very well positioned for that and to take that and run with it very quickly. And so I'm going to be working. As soon as I get back, I'm going to be reaching out to some different nextdoor members that have been successful at this. And I'm willing to find out how to make that work so I can at least
Speaker 3:put some of that excess workforce that I have and, and put it into sewer sales. Well that sounds like a good place to put your energy to me. Right? And it's, it's, and it's within the model, but it's a new endeavor, which I know excite an entrepreneur like you. Right. And keep your, keep your passion going into this business and well done. Well done. And thank you for sharing all this. Well thank you Jack[inaudible] appreciate it. Oh, you gotta get in class here pretty quick, but I'm, I'm so thankful that you got up early. You came on in here and shared your story and uh, I think we can learn a lot from this. So thank you. Well, thank you jack. All right, thank you all for listening. This very interesting story here from David Hammons and Lisa Hammons and their journey through this industry. And now we'll hope you gained a lot from it and I sure enjoyed it. So thank you for listening and we'll catch you next time.