The primary focus of our discussion centers on the imperative strategies for enhancing one's business during economically challenging periods. We underscore the notion that a downturn can serve as an opportune moment for growth and expansion, provided one remains proactive and committed to marketing efforts rather than retreating into complacency. As we delve into the intricacies of maintaining a robust business presence amidst adversity, we highlight the potential pitfalls associated with diminishing marketing initiatives, which can inadvertently constrain future opportunities. Furthermore, we explore the vital importance of leveraging technology and innovative approaches, such as artificial intelligence, to streamline operations and maximize lead generation. Despite some audio challenges encountered during this episode, we assure our listeners that we are diligently working to refine our technical setup for future discussions.

Eric G and John Dudley engage in a profound discussion about the imperative for businesses, particularly in the construction and design sectors, to adapt and thrive during economic downturns. They assert that such periods should not be seen merely as challenges, but rather as unique opportunities for growth and development. The conversation emphasizes the critical importance of sustaining marketing initiatives even when the prevailing economic climate is less than favorable. Eric articulates a key principle: while many companies instinctively reduce their marketing expenditures in tough times, this practice often undermines their potential for future success. By remaining visible and engaged with clients, businesses can capitalize on the opportunities that arise when competitors scale back.

In addition to marketing strategies, the episode highlights the essential role of financial management and job costing. Eric recounts a cautionary tale of a contractor who, despite initial success, faced severe financial difficulties due to a lack of attention to financial oversight. This narrative serves as a stark reminder of the potential pitfalls that can arise from complacency during prosperous times. The duo stresses that maintaining rigorous financial practices is indispensable for long-term sustainability. Furthermore, they explore the integration of technology, particularly artificial intelligence, as a means to enhance operational efficiency and lead generation, thus allowing businesses to maintain a competitive edge.

Through their insightful dialogue, Eric and John provide actionable strategies for industry professionals to navigate the complexities of the current economic landscape. They encourage listeners to adopt a mindset that views challenges as opportunities for innovation and growth. The episode serves as a valuable resource, offering guidance on how to leverage marketing, technology, and sound financial practices to not only survive but thrive in turbulent times.

Takeaways:

• In times of economic downturn, businesses must retain and even enhance their marketing strategies to attract clients.
• By remaining proactive during economic hardships, businesses can position themselves as leaders and gain a competitive edge over less active competitors.
• The current economic climate necessitates a meticulous examination of project costs and financial health to avert substantial losses.
• Adopting innovative technologies, such as AI, can significantly enhance lead generation and client engagement for construction professionals.
• A crucial error made by many businesses is to reduce marketing budgets during slow periods, which ultimately undermines their growth potential.
• Expanding business operations and maintaining visibility during challenging times can yield significant long-term benefits and customer loyalty.

Companies mentioned in this episode:

• Dave Ramsey
• Ruby Receptionist

Foreign.

The House Pro Insider.

This is the podcast for trades pros, carpenters, contractors, interior designers and innovators building homes, renovating spaces or creating the next big thing.

Let's dive in with your host, Eric.

G. Welcome to the around the House Pro Insider.

If you are a contractor, remodeler, designer or inventor of the coolest newest product out there, this show is for you.

I'm Eric G. And we got sitting here in the co pilot seat, Johnny Dudley.

Good to see you, brother.

Good to be here, brother.

Always a fun time, always a good time.

Talking about our passion of helping people out and making sure that they're doing the right stuff to get the most out of their business or business plan.

And man, this reminds me right now and I just made it through a huge storm of getting through the divorce and I signed the papers on the house.

So that closes next week.

So I'm feeling refreshed having that load off my back.

But the thing is we're in a rough economy up here in the states right now is and some areas construction just isn't happening and in others it's doing okay, but it's circling the drain as well with the economy.

And so I really wanted to talk today about what you should do in these down economy times to make sure that you're getting the most out of your dollars and you're keeping the crews busy or that you're expanding your brand because it's so important.

Right now my biggest times of growth with businesses are during these times.

Yeah, no, it's true.

If you stay the busy guy while everybody else is treading water, it always pans out for you.

Same, same.

Everybody says everything shuts down in December.

And that's when I go out and get a ton of business, ton of work.

Right.

Yeah.

Because nobody's answering emails, nobody's got things going.

And I think the biggest mistake that companies make right now is that they're cruising along and they're like things are slowing down.

What's the easiest pain point to pull away?

And they pull away of marketing and advertising.

Yeah.

And it's dude, that is the funnel coming into your business.

My theory is you that's the time to expand it and make sure that you are making your process is clean, is easy, as transparent and efficient as you can, not the other way around.

Yeah.

And here's the reality of it.

Not to sound, I don't know, brutal, for lack of a better word.

These lean times weed out a lot of the lower tiered players and it's your time to come in and really show that you're the expert and you're the leader in the field and you're sticking and you're staying even during the bad times.

Right.

Because who wants a contractor that might go away in a couple years and never going to come back and fix anything they did so, let alone in.

The middle of the project.

Right?

Yeah.

Better to.

To step up and put more out in these times because it speaks louder than when everybody's doing good, everybody's got the marketing money, and everybody's got the time to do it.

And yeah, these lean times, it really pays off.

And you know something?

These are the times that those contractors out there that are right in the fence of maybe they've been misquoting projects for the last two years and didn't realize it.

And all of a sudden that's coming down where they're like, oh, I'll make 15%, no problem.

And all of a sudden they're like, they've slowed down enough that the cash flow is not writing the business out like it used to.

And it buried those problems because you had enough money coming in and enough money going out.

You had no idea that you were running at a fifty, a hundred, two hundred thousand dollars deficit because nobody took time to job cost things or anything else.

And these are the times I saw this last week here, this last week, I was shocked.

I got sucked into Dave Ramsey on one of his videos.

It was a video of his.

Of his podcast radio show.

And I get sucked in on those sometimes.

And it was about contracting.

This contractor called in.

Good at calling you out.

Oh, and I love it.

I love it.

And the guy's just.

And I could see Dave Ramsey, like, getting acid reflux over this call.

Just like, oh, no.

Oh, no.

Guy called up and said, hey, I'm a contractor.

I'm in trouble.

I didn't realize that we'd been.

And just like I said, he had not realized that his deposits were pushing his business along until things got tight.

Then he went, wait, what?

We're 200,000 in the hole.

How are we going to get this $200,000 remodel done?

$40,000Amex bill this month.

Oh, oh.

And it happens to you a lot, especially when you're busy, especially when times are good because you are just cash flowing and it's rolling over and rolling over.

And sometimes you can see it if you're honest with yourself.

You're like, I'm robbing Peter to pay Paul this month.

You always comes down, man.

And I think oh.

And it comes down so hard.

We've all done it.

We've all done it at some point and.

Yeah, yeah, yeah.

And the stress that it puts on.

Your life, I'm excited for.

We've mentioned the consulting thing a couple of times and you and I both having been through this several courses, I've hit.

Yeah.

I'm excited to be able to put that out there and start helping some of these folks that don't realize that's even happening.

They're excited, they got a lot of business, they're doing great projects, they're getting tons of referrals.

And as a contractor, the last thing I want to think about is my books.

It's the worst part.

And so many people don't have the money to pay the pro to do it.

And that's something that I did with my last big company that I had is I had a full time bookkeeper in the building.

Yeah.

And I had enough designers that that made sense.

And even for that.

And part of this was because it was the state of Washington, he was overwhelmed because of the regulations and the taxes and how he had to watch it.

And, and you know that being in a contractor in Tacoma with each zip code having its own tax rate and having to track all that stuff and that nightmare.

But it.

And I also knew earlier than I ever had that we were getting in trouble because we were, we were job costing every job before we paid the commissions to the designers out.

So we knew what the numbers were and if we were in the, if we were under 20%, I was like, we got a problem.

We're not covering our nut on that.

So it was one of those things that we could see things coming and between job costing and understanding what business is costing you.

And like I said, my biggest growth period brother was just out there.

Now is the time to be advertising.

Now is the time to be promoting.

Now is the time to be fixing that website and the contact page to make sure that when you get, get a hold of.

And some of the things I did were so stupid.

Easy with technology these days.

Just going to say there's so many simple things you can do now with AI outreach and getting more leads coming in and not missing those leads with AI assistant agents that, you know, pick up the call, you get notified within five minutes and you're on the phone with a possible lead.

Now those are leads in the past that would come in on a contact form.

You might look at them within the next week and then you give them a call.

They've Already forgotten who you are.

They've already called five other guys, so a lot.

Someone's called them back already.

Yeah.

A lot of these systems, especially AI generated, can create so much efficiency with catching leads right away.

And really 10x things, man, it's amazing.

The capabilities right now.

And you.

It's hard.

I get it.

I was a contractor.

You could have told me all about that and I wouldn't.

I wouldn't have wanted to pay attention.

Yeah.

But there's two things you need that marketing person that you can lean on and trust and go, man, if you think I'm going to put in a dollar and get two back, let's give it a shot.

And then you need some kind of financial controller that says, no, you're not buying a new truck this month.

Exactly.

Because this is what the last three jobs look like and here's what's coming up and it's not going to come out good.

Yeah.

And that's where the brilliance is.

And you're right.

Back then, and this was 12, 15 years ago, I hired a company to answer my phones for me.

Because if we only had one person answering phones, sometimes an ad would run and we'd have seven or eight people calling.

And so I had it where.

If that rang four times in the office.

The American Receptionist Company.

I forget what they were called.

There's Ruby Receptionist.

Now there's other companies out there and if they see that it's gotten to four calls, boom, four rings, they're on it.

And there's.

Hey, he's in a meeting right now.

If they call up asking for Josh, let's say we'll make the name up.

Josh is in the meeting.

I can put this right in the first of his call you right back.

And someone feels like they've been heard, they've talked to a human being, didn't go to voicemail, and someone's going to call me right back in.

Just that alone closed so many jobs that we would have lost because we just didn't know if.

And then I got a report on my desk every day at the end of the day, what phone calls, what messages?

And I knew if we.

Because I had a tracking system.

Did everyone get touched?

Yep.

And we knew it was taken care of.

And now all that stuff is automated.

Oh, it's AI.

You don't need anybody to do all those different jobs now.

Call comes in, AI answers questions, gathers information, throws it into your CRM.

Automatic notifications go out to everybody that's necessary.

It's.

It runs itself.

Yeah.

It's.

Yeah, it's crazy.

It's so simple.

It's so simple if you know how to do it right.

Yeah.

And it was so funny.

And I think I told you about this, Johnny.

The other night Elise and I were sitting here, we were just finished up dinner and she goes, okay.

And she's not a technology person.

She still calls in and calls in and makes her payments over the phone.

That's how she does things.

And that's does it on a laptop.

She does.

It's probably hasn't been open for two years.

One of those kind of things.

That's just how she operates.

Totally cool with that.

She goes, okay, please explain to me what AI is.

And so I grabbed my phone, I had the GROK app on it, and I just used the text and I had a 20 minute conversation trying to track down my dad's work history with the U.S. government, Department of Energy, CIA.

And we went down a rabbit hole.

And that's what happened.

It was a rabbit hole.

And she's.

And I was having this conversation back and forth with the AI.

No, that's not right.

But it's.

But he actually worked here at this location.

And we put together an entire job timeline of where my dad worked using public.

And a lot of it's classified, so we didn't know all of it.

But all the stuff that was out there, I tracked it down and we're like, oh my gosh.

Wow.

Oh, wow.

And she was just blown away that I had this conversation.

And it would have taken me a month of doing online research in trying to put things together.

It was dumb.

Can lose a lot of hours in conversations and.

Or arguments with AI for sure.

I've gone down save the world.

The save the world rabbit hole with AI.

Oh yeah.

Hours.

Absolutely ridiculous idea.

That'll never work.

And here's why.

Based on history, like, I love it.

I just love a good argument.

You know me.

Absolutely.

You and I are both the same way.

And it's awesome.

That's the thing, really getting out there, using technology to help you.

And it's so affordable.

It's so reliable.

Yeah, that's the thing too.

I'm out there.

I was spending back then $10,000 a month in radio advertising.

Yeah.

And I was aggressive and it worked.

I had a company that was a large Kitchen of bath design firm selling cabinets.

And one company came out and said, okay, we gotta get aggressive.

And they were giving away a free Traeger grill with a kitchen purchase.

What did I do?

I came out with an ad that same day.

Like, four hours later, I heard it, and I'm like, oh, I'm going after it.

And so this was my battle.

I started out and said, hey, and I put my company name out there.

Our prices are so good.

We don't have to give you something else to make you feel good about your purchase.

Our prices are good every day, and we don't have to give you something to try to make up for it because we feel bad.

Yeah, I know.

And you know something?

That ad went down.

Yeah, Ad went down.

They took that down.

The next day it was gone.

And I was like, oh, funny.

I mean, you gotta figure, right?

The cost to value ratio in trades in general, right?

Yeah, just in the trades in construction, as a contractor, whatever you're doing, whether it's kitchens, Whether it's H Vac, whether it's okay, you're spending 10k on advertising for the month, but one job covers that.

Yeah, maybe two.

Whatever.

Spend 3,000amonth and get one job, like.

And all of a sudden, since they heard you on the radio, they saw you on a video, they did something, you're the instant expert.

And generally speaking, those jobs you get a higher margin on because they're contacting you, because they go, oh, I want these guys to do it.

Yep.

Yeah.

No, you become an expert in the space and people trust you, and you look like you're not going away.

That's a big deal.

Especially with contractors.

Just getting callbacks from contractors is difficult, let alone to show up.

And they would even give you a bid.

Yeah.

And I never could believe that.

But it's different than they'll complain about not having work.

But yeah, again, the cost basis per lead is outrageous in an industry like that.

So I think they can't afford.

I can't spend $2,000 a month on advertising.

But yes, you can.

If it wins you a $10,000 bathroom remodel, you can't not spend that money on advertising.

That's why every legitimate, successful business has X aside for a marketing budget.

That's how business works.

It's 101, man.

It's like paying the power bill.

It's got to be on.

It's got to be on so well.

Brother, we got to keep this short today because I try to keep it short for everybody just to get these Nuggets.

I want to talk.

Coming up on another episode, which I think would be a lot of fun, would be talking about people giving away free, detailed estimates and why I think that's a mistake.

Maybe we'll talk about that next time.

Because I see contractors out there spending an eight or ten hours breaking a remodel down for free, and I'm like, no, no, don't give them the budget.

If they want to go to it to go to contract, do it.

And we'll talk more about that because I think there's a lot of people wasting a ton of money out there.

They should be at least compensated for the time they've spent.

And I've got some secrets on how to do that.

So we'll talk about that maybe in our next episode.

But, Johnny, great talking to you today, brother.

I know you had some big projects to dive into.

I gotta go get the moving stuff packed up and ready to go because I gotta get out of a house in a week.

So you know where I'm gonna be today.

So much fun.

And I got a buddy coming over to help.

I've got Colison coming over today, so he's gonna be coming over to help, so.

Nice.

Give him a kick in the shin for me.

I will.

I will.

Probably punches back hard, so I got to be careful.

So he's a thick kid.

Yeah, I wouldn't want to mess with him.

That's why I'm making you kick him, not me.

Exactly.

All right, everybody, we'll see you next week.

Thanks for tuning in to the around the house pro insider.

Thanks for tuning in to the around the house pro Insider.

We are happy to be back.

Make sure you subscribe so you know to catch the next episode.

We will see you next time.

Man, I need to focus now.

What is that?