Hey there all! Kenny Chapman here again, and I wanted to share some information I hear about all the time from my clients who I coach on leadership and growth in the home service industry. 

This has been a game-changer for me, too, as a former leader in this space, and I’ve loved sharing this in my coaching sessions with hundreds and thousands of clients.

Today, I want to talk about scaling your home service business without management and why it’s so dangerous. 

You better be careful, my friend, and this is near and dear to me. 

And it’s very raw because I’m seeing a lot of this challenge in the home service space right now. I want to just kind of rattle your cage a little bit to raise some awareness, some reality, and some mindfulness, if you will, of kind of what’s taking place.

I want to highlight the shifts and focus and trades and trends and different things that we’re seeing all over the U.S., Canada, and Australia. 

Let’s dive in and make sure we know what we’re talking about on this topic. 

scaling your service business

The State Of Home Service Professionals

It’s literally like the wild west, right? 

I don’t know if I can say literally, and at the same time, I can say it’s literally the wild west. 

But I know that’s not actually true. 

I kind of live in the wild west, but nonetheless, we are seeing just unprecedented levels of scale and growth in the home service space. 

We’re seeing companies that are growing multi-millions a year. 

We’re seeing multimillion-dollar acquisitions. 

It’s almost like a bidding war in the real estate market. 

That’s been taking place in 2021. 

Back in April home sales, there was something like 82 or 83% of homes that went on the market.

That’s just fascinating to me when only a short 13 years ago we started one of the most challenging recessions in the world, and here we are just slinging it around like it’s like going out of style again when it comes to capital and assets and all kinds of different things. 

That’s great. 

I’m an abundance guy. 

I love growth. 

It’s one of the coolest and most exciting times in the history of us in home service that have been doing it for quite some time. 

Now let’s be mindful though of what this means. 

Everything has effects.

Effects And Side Effects

In a past article, I talked about effects and side effects and becoming an intentional leader (click the link to check out the original post). 

I was talking about pharmaceuticals and how they sell drugs, and there’s going to be effects, and there’s going to be side effects. 

They’re only called side effects if it’s not what they were selling you. 

The same is true with business growth and with the scaling that we’re seeing. 

I’ve recently talked to some contractors about what the industry would consider kind of exponential growth recently.

Now they’re going through some pain and some struggle because the business is growing faster than their management capability can handle. 

Let that land for a minute. 

I want you to think about that for a minute. 

Is your business growing faster than management capability? 

If the answer is yes, that’s OK. 

I want to raise awareness and help you through this awesome problem to have a bit today, and you help you know where to focus your energy. 

After all, focus is important in success as a leader (wouldn’t you know it? There’s an article on this topic too!). 

If you’re thinking this: 

Oh man, this company’s outscaling my management team. I’ve got to focus on growing managers! 

Hold on and read this first!

There’s a supply and demand aspect that we’re experiencing right now where demand is way higher than supply. 

And we’ve got supply chain challenges. 

We’ve got all kinds of health challenges. 

There’s just more demand than there is supply in a lot of capacities in the world at this moment, but especially in our rapidly scaling and growing home service industry. 

Take A Breath

That being said, it doesn’t always last. It will catch up. 

Supply will catch up with demand. The market will settle down if you will. 

Sometimes companies “right-size” themselves because they’re not capable of either maintaining at the level that they scaled to or go back to a level before of where their actual leadership ability is. 

What we’re seeing with roll-up acquisitions is there’s sometimes—I won’t say it’s all the time—when there are acquisitions made, and there are disconnects created amongst teams. 

Teams are simply groups of people that are led by somebody that creates influence. 

When we take disjointed teams and disjointed leaders and pour them all into the same pot, we’re going to have disjointed soup. 

It’s kind of Leadership 101 or Business 101, here. 

But when the market is screaming as loud as it is, and when clients are screaming as loud as they are, and when it’s never been as easy to operate and sell as it is right now, then you just want to say yes, right?

You know, we train our team with the phrase: 

Just book the call, just book the call. 

Now we’re just booking the call. 

Now we’re in the field going: just sell the call, just sell the call. 

And then we’re going: just install it, just install it

All of a sudden, we’ve had this massive ability to grow. 

Some companies have scaled very quickly. 

Scaling Your Service Business: Scale Your Leadership Efforts

I’ve said this to clients of Blue Collar, but I also want to just say it to all of you out there regardless of where you get your coaching and training.

In the last 18 months, leadership capability has not doubled. 

Everybody has not become their record-month capable leader. 

I don’t mean that negatively, and I’m not trying to kick in the gut or to take away your incredible success that you’re having right now. 

Wall Street’s finally given us a shake. 

They’re finally paying attention. 

Guess what? They’ll go away when it’s not sexy anymore. 

Be mindful about why there’s so much money in the trades, and it’s because there’s no money in tech right now. 

There’s too much instability in other industries. Our industry makes sense now. 

So they’ll come here and get their “little return” that they can get right now. 

And then be mindful. It may go away.

Now, I’m not mad at them. I’m not mad at the system. 

My friends, I’m not mad at the situation. 

I’m just a realist. 

And I pay attention to what takes place. 

One of the things I talk about is that “history doesn’t repeat itself, human behavior repeats itself.”

Any of us that have been around since the early 90s have seen multiple roll-ups, multiple acquisition times, and this happens to be another one. 

It doesn’t mean that people aren’t doing it better than they’ve ever done it. 

Some people are doing it as bad as it’s ever been done. 

I don’t care if you’re selling. I don’t care if you’re buying. 

It doesn’t really matter what you’re doing on the service side. 

What I care about is that you’re mindful of how you’re going about what you’re doing. 

Remember, at the end of the day, it’s always “who before how, but after why.”

Just Because Something’s Easy Doesn’t Make It Right

It’s easy right now in how we answer the phone. 

We go out; we create options. 

And we offer some prices and client pricing and clients are saying yes. 

The “how” is being executed very effectively. 

The software’s come in and streamlined the flow of information and the ability to track and have information on our technicians and sales and clients and systems, and everything has gotten easier. 

I’m not saying: Oh, it was hard back when I had to go through the snow both ways. 

That’s not what I’m talking about. 

The reality of things is amazing right now. Let’s capitalize, sure. 

But at the end of the day, the company is a reflection of the leadership team. 

The company is a reflection of the training, a reflection of the coaching, and a reflection of the communication.

I want you to be super mindful and super clear that as your management grows, so the company goes right.

We always talk about focus. 

Right now, there’s an obviously massive opportunity. 

There’s a huge, incredible time right now, but if you’re not growing your management, it’s not going to be sustainable for you. 

We will see companies that are growing very, very quickly and then “right-size” themselves back down. 

They will slow down their growth. 

They will scale back their growth. 

My friends, they will shrink in revenue because management doesn’t have the capability. 

I’m not saying they’re bad. 

I’m saying that either they haven’t been trained, they have too much being put on their plate, or they don’t have the time capacity to grow. 

They don’t have the time capability to coach and train and influence, and stay in contact and connection with their frontline team.

All Business Is A People Business From The Top Down

As we continue to learn and grow and understand what’s going on, realize that at the end of the day, no matter how much technology we have, human behaviors drive the change in the results in this space. 

Now, we get to have an awesome opportunity. 

I love the scale that you’re experiencing. 

I love nothing more than seeing all of the record months that people are having and all of the money that’s being printed in the home service space. 

Hey, it’s about time! 

We’ve been putting in this time kicking and scratching for 2%, 3%, 10% net. 

Now we’re flowing money like crazy. 

We’ve got phenomenal gross margins, and all these incredible things are happening. 

And I just want you to be mindful that we’re seeing companies hit the wall if you will because they’re not growing management at the rates that the market is scaling.

Don’t get me wrong. I’m not saying: 

Hey, stop the presses and stop going out and executing! 

I love the scale. Stay on top of it. 

Which Is More Important?

Keep on doing what you’re doing, but be mindful that it’s kind of like the chicken or the egg situation. 

Are you happy because your business is being run well, your team is working together, and everyone is executing at their highest level and aligned with their primary purpose and strength? 

Or are you just happy because you’re making money?

Money is freedom, and money moves the world, yes, but it doesn’t buy happiness, and it doesn’t equate to success. 

Yes, money will often indicate success, but real success comes from all those other things we talk about on this blog and in my podcast all the time. 

It’s about change and growth and handling that by putting our focus on what’s important, and if you just sit there and enjoy the gravy train, it’ll never last. 

When the gravy runs out, you’ll be left starving, and you’ll have failed to take advantage of the opportunity to make real, lasting growth for you and your team and your business. 

Harsh, right? 

I’m a positive person, and I’m dying for you to take advantage of this scaling opportunity by keeping the important things in mind: 

Who before how, but after why. 

Start with your team’s purpose, then make sure you get the right people and get them trained. Then focus on the “how” you make money. 

Believe me, I’ve seen it thousands of times when the market was good for us, just like now. 

Get your purpose and people aligned first, and the rest falls into place for good. 

Now go and train your people, get the right people, and make it a better-than-fantastic day! 

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