100. How He Makes $1.25M/Month Scooping Pet Waste?!

0:00Are you struggling to scale or start a business? In this episode, you'll be able to think about the million-dollar business idea that might be hiding right under your nose. Or, in EJ's case, under his nose. And offending his nose. The mission of that company is to conveniently add value and comfort to your property. The long-term vision of it is to be an all-encompassing home services brand that really innovates the client experience in home services at the macro. And as we were dominating the search engine optimization, we just kept going. And before we knew it, we had 12 markets. We tend to be middle of the road, our pricing.

0:34I don't like to be the cheapest. And when I'm the cheapest, I feel like I'm probably selling ourselves short. But at the same time, we want to be competitive. We don't want to necessarily be the most expensive just to be the most expensive either. I'm your host, Alex Freeman. And on today's episode, we're going to speak to E.J. McCoy, owner of Scoop Soldiers, a pet waste removal company that began when E.J. was mowing lawns. He took this nuisance of a problem he encountered while mowing and scaled it to a $25 million business. Let's get started. EJ, welcome to the show. Yeah, thank you. Thank you for having me, Alex.

1:05Appreciate it. So I guess to start us off, give us your background and what prompted you to start a pet waste removal business? Yeah, no, I started mowing lawns at a really young age, eight years old. And by the time I was 21 years old, I was, you know, pretty seriously mowing yards. I kept trying to get away from it and couldn't get out of it. And so naturally I got pet waste removal and the industry got my attention as I was growing my mowing business. It just seemed like something that was natural. It was an easy fit. It didn't require any kind of licensing, that sort of thing. And so yeah, after mowing yards for five, six years, I saw the opportunity for pet waste and I saw an open area.

1:42You know, I'm a big believer in the convenience economy. I thought pet waste was a really good fit to the convenience economy. Now, I know a lot of people start mowing lawns at a fairly young age, but eight seems very young and sounded like it went beyond mowing the neighbor's lawn for like 20 bucks. So what kind of gave you that entrepreneurial spirit at such a young age? You know, it did start with just the neighbor's yard. I had a neighbor who had rheumatoid arthritis, good friend of my mother's. And my mom was somebody who believed in the value of work. And so that's kind of answers that question as far as that entrepreneurial spirit.

2:13And she said, you know, EJ can do this. He's old enough to learn. And so it was definitely tough. I wasn't terribly mature early on. And I was only getting five or$10 when I was eight, nine years old. But that is how it started, a neighbor who had a need. And my parents definitely instilled in me the value of hard work. My dad was a fireman, and a lot of firemen have side gigs and are very entrepreneurial. My dad was entrepreneurial. And so he really did instill that ownership mentality in me from a young age. What were some of those early lessons that you learned in the lawn care business that kind of ultimately helped you as you launched Scoop Soldiers and your other ventures?

2:49Yeah. So as you can imagine, there's a lot of similarities. Lawn mowing was a little bit tougher in a number of areas. It required more equipment. It's a little bit tougher work. It's dirtier work, believe it or not. As unsanitary as scooping dog poop might sound, it's really a pretty clean job. I mean, your equipment isn't big, loud, heavy machinery. It's a dustpan and a rake. And so it was simple. It's about simple services. And our lessons learned in mowing definitely carried over. Answer the phone. Make sure you're answering the phone. Take care of your client, the very basic things that work in all business, take care of your client and make wise decisions, plan ahead.

3:24That taught me in lawn mowing, the weekly consistency of it, the fact that it has to be done every week. So they're expecting you there. That really played into our early success with pet waste removal because that's what they expect in the pet waste business is really a consistent service. And when you went into that pet waste removal business, what were some of those startup costs? Because obviously, yeah, there's equipment involved, but it's not lawnmowers and that kind of equipment. So what were those startup costs? To put it in a nutshell, we started our business with about 5 ,000 bucks. Ironically, that's about the same amount that I started my mowing business with.

3:55Granted, I already had the equipment when I started my mowing business, lawnmowers and such. But we started with$5 ,000. As far as what that goes to and what the costs are, you don't have any equipment. You need a truck. Some in the pet waste industry, we frown upon it, but some in the pet waste industry leave the waste at the client's property. And so they don't even, all they need is transportation. They can be driving around in a Toyota Prius. We recommend trucks so that you can haul the waste away. So you need a truck, you need a dustpan, and you need a rake, and you need trash bags. Now there's a little more to it than that.

4:23We've got a few other services, deodorizer and sanitizer services, but it is really a very simple service in the fact that you don't have to have a whole lot of startup costs. The rest of that startup cost goes into your marketing, and that's where you definitely have to have the know-how. That's where really there is a huge difference in your success versus your failure, is your consistency and your know-how when it comes to marketing. And I'm sure we'll get into that here shortly. Yeah, definitely. And I want to hear a little bit more about if cost isn't prohibitive, what's the biggest challenge of starting this kind of business?

4:52It's the grind, that early grind, the patience and the consistency that it takes to ramp up your business. It's not something that from day one or from day five, you're going to be cash flowing and it takes time. It's a snowball and more than any business I've ever seen or been a part of, it's very much so a snowball. It starts off real small, real slow, and it just gradually builds and builds and builds and builds. And while it's doing that, and while it's snowballing, of course, how well you're tweaking things, how fast you're learning, how much you're pivoting and shifting based on what you're learning, all of those things play in.

5:24But it is a very slow process, especially early on in this industry, as I've found. How do you push through that grind? Patience. Patience. And with that patience, you've got to have the resources. You know, the longer something takes it going, the more it tends to cost. And that cost is usually, you know, that's money, but it also is a cost in time and in labor. The longer it takes to get your first route, the harder you're going to have finding somebody who has just that perfect, you know, I need this many hours and you've got this many hours of work for them, if you know what I mean. Figuring that aspect out early on is definitely can be a grind, especially if you're doing this as a side hustle, which a lot of people tend to do.

5:59You're operating multiple brands in the home services niche beyond Scoop Soldiers. So can you talk about what those other brands are and how they complement Scoop Soldiers? Absolutely. You know, I mentioned earlier, I started mowing yards. I incorporated my first business when I was 21, which was basically me mowing yards, literally mow yards, trim shrubs, mow yards, trim shrubs. And that's what we started. That was back in 2006. Five years later is when we established Scoop Soldiers. What is today a second brand that I operate as the co-founder and CEO called Chorby? It's really the original business I started when I was 21 years old from mowing yards.

6:34It's still bread and butter to this day is still mowing yards, but it does everything from mow yards all the way to cleaning pools, to pest control, to plumbing. The mission of that company is to conveniently add value and comfort to your property. The long-term vision of it is to be an all-encompassing home services brand that really innovates the client experience in home services at the macro, you name it, we want to be a part of it. But really innovating the client experience through technology, that's a long-term play, that business. But that's actually really the business that got everything started.

7:05It became Chorby in 2019. Forgive my long-windedness on this answer. Another brand we've got is White Picket Team Management, which is really kind of our back office business. It's an ASO, an administrative support organization. And really that's your back office type support, your accounting, your legal, your HR. That's a company that we've got that really operates kind of as that parent company for our multiple brands. But it also, in time, will be a brand that helps other businesses in that back office support, specifically in home services. And so thirdly, we've got another mowing brand called Executive Lawn Care.

7:38And that business is much more simple than Chorvy. It just simply mows yards. It was a company we acquired back in 2014, and it's basically operated independently since then. What are the pros and cons of having those multiple brands as opposed to just staying focused in on the Scoop Soldiers niche? Yeah, so the definite pro is that it does give you some flexibility and diversity, both in income. So, you know, for example, Chorby's a long-term play. Chorby is not something that necessarily is a huge moneymaker today. We reinvest all of the profits back into it. Scoop Soldiers is something that's growing very fast, but at the same time, there's some profit in that business.

8:14And so it gives you that diversity and focus and the timeline of each business and the strategy of each business. The con is exactly what you said. It's the focus. The toughest business that we've got is the business that is offering the most services and is trying to do the most. That is the hardest business. Now, I think that business has validity. What we're trying to do there is really to disrupt home services and to really do something unique that's never been done before with the client experience. You know, it's not about how easy it is. It's about the client experience. But at the same time, it's really hard.

8:44And it's hard for that business because it is so broad and it's hard to stay focused. Whereas the other businesses we've got that we've done a good job of keeping very specific and very focused to just a handful of things. We are really good at those things and it allows us to grow and scale a lot faster. Can you give us a sense of kind of what the profit margins look like in the different home services that you work in? If somebody's thinking about starting a lawn care company or a waste removal company, what kind of margins should they be expecting or aiming for? So when you mention profit margins, I'm going to assume you're specifically talking about bottom line net profit.

9:18What can you walk away from in these sorts of businesses? It's your net profit, your bottom line profit. And in a nutshell, and this kind of transcends the various home service industries, is anything at, around, or north of 20 % net profit, you're doing pretty good. Now, there's a lot of variables to that, a lot of variables. Chorby, for instance, has not made a 20 % net profit in probably five to seven years because we just dump everything back into the business. It's not intended to have a big profit. But then you look at the simple service of pet waste removal. That's by far the most profitable service line that I've seen in home services of any of them.

9:51And it runs anywhere from 20 to 35 % net profit. We've got different franchisees across different geographic areas and demographics, but it tends to be the most consistently high profit. It's such a simple business. And that's the beauty in it. The key is, is the know-how and having that know-how. But yeah, 20 % give or take when you think about all home services and mobile pet oriented type businesses. But the farther north you can get of that, the prettier the business model tends to be. There are a lot of ways to start a business in the home service niche. check out the UpFlip free masterclass on how to start a cleaning business and make$10 ,000 in the first month.

10:25The link is in the show notes. EJ, I want to get into some of the marketing side of things here. And I guess the first question in that realm is how do you connect with customers as a new home service business? So I guess I'm going to ask you to go kind of back to the early days. How did you initially start connecting with those customers? Yeah. So we built our business starting off when I go back to 2006 and even earlier than that, totally different world. It was all door hangers, especially when it came to what I cut my teeth in lawn mowing. It was all door hangers. It was how many door hangers could I get out?

10:55I can remember having a full-time job, 40 hours a week, 7 a.m. to 3 p.m., but then going out and doing door hangers for a couple of hours until it'd get dark. Then I would replace the time I spent with those door hangers doing the work that those door hangers produced. That's how I started. In 2010, when we started doing pet waste removal, the bright idea about why we looked at that and saw that as an opportunity was like, hey, we can just put a pet waste removal business on the back of our door hanger for lawn mowing. Now we've got two businesses. What a beautiful thing. We quickly learned that for pet waste removal, door hangers didn't really work.

11:27They just dumped. I do still think there's value in door hangers today when it comes to lawn mowing and lawn and landscaping and other home services. You got to do them right. It's definitely more challenging than it used to be, but there's some value. In pet waste removal, I don't see much value in door hangers. So we early years in pet waste removal, we learned and figured out what search engine optimization was. We had never heard of it when we first started our pet waste business. And we learned through just really studying and obsessing over what is the competition doing? How do you get clients in this business?

11:57And we discovered search engine optimization. And for years, we dominated for both mowing and lawn care, as well as pet waste removal, we dominated organic search engine optimization. And of course, that's a moving target. And so as that began to get more competitive, we continued to focus on it, but we introduced other social media and some paid, some organic. In some ways, we've been ahead of the curve in how we've done that. In other ways, we've been a little bit behind the curve, especially when it comes to really building out organic social media, which is now and moving forward into the future, a huge focus.

12:29I want to hear a little bit more about your social media use. What tips would you offer to someone else in the home service business about how they should be utilizing social media to connect with customers and generate leads. Absolutely. I'll first admit that I'm still a student here more than a master. It's a moving target. It's something I have studied for years, but I have not really fully begun to execute on and do what I'm about to preach until here the last few months. And so I'd love to follow up with you in another year or two years and let you know how it's going. But the biggest thing I would say, and the strategy we're going off of is volume, like start, get in the habit and build volume.

13:03And of course that volume has to be quality. You can't just throw absolute crap out there and expect it to do much. You've got to have quality in mind, but that goes without saying, you've got to have quality in everything you do. You've got to get the volume. You've got to be consistent in what you do, whether it's once a day, five times a day, whether it's LinkedIn, whether it's meta, the various meta platforms, start somewhere and stay consistent at it. And based on my studying, being a student of this for the better part of a decade, granted, haven't properly executed until fairly recently, and we're still learning.

13:33But that's kind of my take on where we're at with media and what's needed for home service businesses. How do your marketing strategies differ between seeking commercial customers versus residential customers? Yeah. So we are 95 to 98 % residential in all of our business lines, depending on the business line, depends on whether or not we're 2 % commercial or 4 % commercial, but we are almost all residential. And I say that that's not something I'm necessarily proud of. It's just kind of the way it is. We do. We still do hundreds of thousands a year in commercial work. So I don't know a ton about it.

14:06It's an area that we want to focus on these next couple of years. I will say that the big difference is with commercial, in my experiences, is you've got to have somebody actively working the leads, actively out there trying to get bids and putting your brand out there. That's not been a focus of ours historically. We were always, whether it was door hangers, search engine optimization, or paid ads, we were always It's very much so focused on that residential client one at a time. And we've picked up some commercial work over the years and we've talked about and we've looked to build strategies to expand commercially.

14:36I think it's some serious low hanging fruit for us. It's just a matter of putting the resources, the manpower, the talent into it. I think it is a different game though. And that game does involve a lot more sales, direct sales, like relationship based, boots on the ground, you know, handshake, pat on the back type sales. With that in mind, with understanding that maybe the bigger sales department is a longer term game for you, what is the lead process right now when somebody comes in via whatever marketing portal? How do you then turn that lead into a customer? What's that journey? So we've got what we call our client care center at any of our companies.

15:13We basically call it the same thing. It's our client care center. And that client care center is basically ran by account managers. Not all one center, by the way. You've got Scoop Soldiers Client Care Center. You've got Shorby's Client Care Center, Executive Lawn Care's Client Care Center, and so on. So they're all independent of one another, but they run a lot of similar KPIs, a lot of similar training processes and whatnot. The executive team is managing all the client care centers, so to speak. But these client care centers, they're account managers. They're incentivized to close new sales.

15:44They're also incentivized through various metrics for retention, and they're assigned specific clients, specific geographic area, if that makes sense. And while they get assistance, obviously they have to take days off and they have to have time off. They get assistance in that area. They're really the core person responsible for those areas. And there's key KPIs that both help them and they get paid bonuses and commissions when they bring on new leads that have come through websites or truck wraps or in the case of some of our mowing services in rare cases these days, door hangers, as we were talking about.

16:14So a mixture of digital, but they come in as leads and our client care team converts them. And that same client care team is who's taking care of them throughout their client journey with us, which we hope to be, you know, years and years long. How do you make sure that your team is providing excellent customer service for those kind of renewals and that retention level? Yeah, so we're constantly measuring retention. We have retention churn rates that we measure on a month to month basis, 12 month recurring. We measure that. We've actually literally got what we call an ACAR metric. It's average.

16:44Hold on. Now I'm going to really test myself. Average client, annual recurring client, something like that. I just butchered that. But basically it measures everything you just talked about. And then some, it measures accounts receivable. It measures churn rate. It measures how much the client annual spend is. And it measures that month to month. And as it improves, our client account managers are bonus based on that improvement. That all feeds into the fact that you have a 4.8 star rating on Google across some 600 plus reviews, how do you not only make sure the client is happy, but then encourage them to go to Google and tell other people about how happy they are?

17:20We ask and like seriously, so we incentivize and make it a bigger deal for our team members. When a client is happy with something they provided, we do it very tactfully. It's not like high pressure or anything like that, but we ask for the review and we incentivize all of our team members to ask for that review. And they actually do get compensated if they're actually mentioned in a positive review because they impress a client so much that that client named them in a review and gave us a five-star review. They actually get incentivized for that. We celebrate named reviews. If they're named in a review, that's a big deal.

17:53And by making it a big deal, it scales up. Now, you also have a money-back guarantee on your services. So how often are people cashing in on that? And have you had any issues with people abusing that system? Because I know that's one thing that makes some business owners nervous about a money-back guarantee. I empathize with the business owner that's nervous with that. At the same time, I don't fully get it. It's never been an issue. It's less than 1%. And I say less than 1%. It's probably less than one-tenth of 1 % of somebody actually taking advantage of it. So if you think about it, the services that we have built our business on, they're all recurring services, whether they're weekly or whether they're a fertilization program that's every six weeks, they're an ongoing service.

18:32And so clients have habits and patterns. And so, yeah, if we are routinely having to comp service because one thing or another is wrong, obviously, we're going to have a conversation with that client and work with that client to determine, are we the best fit for them? We're not just going to keep doing it for free over and over again. But at the same time, in the day-to-day or in the one situation where we've done something wrong or a client's not happy, we comp the service, no questions asked. And what we have found is that the concerns of being taken advantage of as a business or the concern of anything like that is just so minuscule.

19:03Now, we've tested that, I will mention. We've tested that. We once ran for two years. We ran a program called, If You're Not Happy, You Don't Pay. And we actually practically advertised, If You're Not Happy, You Don't Pay. Well, that was a little bit extreme because we did literally build a culture of clients who every little thing they expected to not have to pay for their service. And that isn't that they were taking advantage of us. We were taking advantage of ourselves in so many ways by just overly driving that home. And so there's a balance. But just offering a 100 % guarantee, you're not going to get taken advantage of.

19:32I guarantee it. The other thing that especially first time business owners struggle with is setting prices, especially in a service based business. How do you go about setting your prices and what would you recommend somebody factor in as they start to set those prices for their own business? The number one thing I'll say is almost everybody in home services starting out, whether you're scooping poop or whether you're a plumber, and those are kind of, to me, two ends of the skilled trade spectrum. No matter who you are, you almost always undervalue yourself. Almost always. It's one of the big issues to me, the overall home services industry.

20:02Huge demand for the services across the board, huge demand, and yet people tend to undervalue their skill set, whatever it is. When it comes to pricing, every business has its own set of overhead. The bigger you are, the more overhead you tend to have, but you also hopefully are going to replace some of that overhead with economies to scale. The way we generally price is we want to figure out what is our cost of goods, which in home services businesses is your manpower, the cost to get the work done, as well as your materials, your products and your materials. So in pet waste removal, that's literally your trash bags and your dustpan and your rakes, and then your manpower, your labor to get the work done.

20:36In mowing, well, that's going to include a few other things. In fertilization weed control, it's going to include your chemicals, your products, along with your labor. And so we want to figure that out. We want to figure out where can we be competitive after those costs, but then what are our other overhead costs, including marketing? What additional value do we provide a client that so few of our competitors can provide? Answering the phone, handling problems, doing a 100 % guarantee, and really living up to that, factoring in and building that added value. We tend to be middle of the road, our pricing.

21:04I don't like to be the cheapest. When I'm the cheapest, I feel like I'm probably selling ourselves short. But at the same time, we want to be competitive. We don't want to necessarily be the most expensive just to be the most expensive either. So this is going to bring us to a section of the show that we call our Fan Blitz questions. These questions come from our YouTube community. Listeners, you can go to youtube.com slash upflip, join the community and post questions to future podcast guests. EJ, I've got four questions here we're going to do in about a minute. Are you ready? I am ready. Let's do it.