Owned and Operated #88 - How To Run a Pool Service SMB with Tim Ryan: Part 2

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Tim Ryan is back to talk more about running a pool care service business. He shares useful tips for newbies, the tricky parts of taking care of pools, and why having a mentor is so important. If you liked the first episode with Tim, you won't want to miss this insightful part two!

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John Wilson: @WilsonCompanies on Twitter
Jack Carr: @TheHVACJack on Twitter

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John Wilson, CEO of Wilson Companies

Jack Carr, CEO of Rapid HVAC

Owned and Operated Episode #88 Transcript

Hey, this episode is sponsored by Service Scalers. So Service Scalers is actually a brand that I've used personally with our companies for a little bit over a year now. Uh, they've helped us manage our digital advertising. Frankly, they did a lot better than our last agency. Leads went through the roof and cost per click went way down.

Check out Service Scalers if you're a plumbing, HVAC, or electrical home service company. That's what they knock out of the park and they did a great job for me.

Welcome back to Owned and Operated. This is our second part of the conversation with Tim Ryan where we're breaking down the pool service business. Great in depth, Q& A basically on answering questions that we have on how to run a pool business.

Okay. I'm trying to think what we didn't cover. So we covered a little bit about customer acquisition we talked about hiring, we talked about retaining,

Jack Carr: For me, my big question that still stands is buy versus build. If you could go back or if you are forced once again to go into and acquire through acquisition, would you buy one of these small I guess I shouldn't say small, but one of these 80, 000, 100, 000 books.

Tim Ryan: Yeah. How money do I have?

Jack Carr: Say you're working.

Yeah, that's a good point. I mean, 60, 000 book. So 60, 000, they trade at what one X. So it's a 60, 000 a year revenue company.

Tim Ryan: Okay. And then how much money do I have?

Jack Carr: 60, 000.

Tim Ryan: That's it?

No, I wouldn't do that.

John Wilson: Half a million. what would you do with half a million?

Tim Ryan: would tell you go get a job at a moving company.

Jack Carr: Yeah. Right. The reason I asked that in that framing is because I think a lot of first time entrepreneurs see these businesses at these low price points and they get really excited because it's just as much money as they have, right?

They might just have that 60 or 40k

John Wilson: Yeah. That's like bread routes

Tim Ryan: No yeah, that's a mistake in my opinion.

That's enough money to like, start your own business and not be stressed out all the time. You know what I mean? That's not enough money to like, go buy a business. Because you're just not buying a business. I think when people do that stuff, they start to imagine like, they're like, Ooh, I could get these 60 pools.

And then I could, hire a guy to do that. And then I can go out and I could grow it. But like, what money are you going to grow with? What money are you going to hire a guy with? And it's Also like the learning curve, like it's not, you can't just jump into businesses and run them if you don't know what's going on in them, especially at that size.

Like If you're buying a 60 pool route, like that customer is going to ask you why his motor's not working. And if you don't know, they're going to not like you like that's cause you're not doing your job. You're supposed to know why my pool's green, and yeah, no way would I buy something at that size with all my money,

John Wilson: What's an attractive size?

Tim Ryan: An attractive size would probably be where there's at least like one or two layers in between you, but probably two layers in between you and the customer already. So that's not that big a deal.

John Wilson: So is that like a service manager and a call taker, or is that like a technician and a call taker.

Tim Ryan: At the point where you have an office manager running everything, because too many things are going on, then that's probably like an okay size to buy.

Because at that point, that's all processes and SOPs and like better software. , you know, at that size, you're no longer solving like field issues, you're solving like business issues. And if you're, wanting to be an ETA, like I think what most guys, when they want to buy a business, they're imagining wanting to solve business problems. They're not imagining cleaning

John Wilson: Yeah. We joke about this a lot.

'cause in Jack's first week he was like, fixing furnaces,

Yeah. I think that's the reality for business, not just pools of like, if you're buying it under 5 million in revenue. And you're not a subject matter expert?

Like, you'll have to become one.

Tim Ryan: You have a year and a lot of pain and like 90 hour weeks sometimes

You've done a 90 hour week. Yeah.

Jack Carr: Oh, Yeah. There was a time when I was running by like I said with without any text where I was waking up at 4 a. m getting paperwork done run all day and then go

Tim Ryan: Dude, I didn't see my daughter for 3 months.

1 year That's a little dramatic but that's what it felt like

Yeah. She was 2 at that time and I would leave the house at five before she woke up and I would get to the house at 9 after she went to bed. And there was like. Like a good stretch there where I'm like, I'm not getting in.

My wife was pissed about it. Yeah. She's not happy about this. This know

John Wilson: Yeah, I think, that continues to happen. I think I've talked about it here, but like, our business is a little bit larger, and like, I just had to do that for like four or five months. I woke up at five, worked till seven, took the kids to school, eight to five, played with the kids for two hours, and then seven to eleven, and then did it again for four months.

It was crazy.

Tim Ryan: Yeah. It's not fun.

John Wilson: Yeah. But, I think that's all to, like, what's the problem that you're solving. And I think at any point yeah, people want to be solving business problems. Or the other way to say it which I see a lot, maybe less now. But I used to see it a lot. And it's like, hey man, I'm a finance guy.

Like, I'm the finance guy.

Tim Ryan: Oh, yeah.

John Wilson: And I'm like, Oh cool dude. Sweet. He's like, yeah, I'm the finance guy. So I'm looking at this million dollar plumbing company. I'm like, a million dollar plumbing company doesn't need a finance guy. Like, what are you gonna do with your time?

It's almost disrespectful. It's like you're like, I'm so much smarter than that dude. And this is what I like that guy is probably smart enough to know that he should be doing better customer service, know, or he should be like doing his books a little better.

Or like he could probably do his marketing a little better or like install that new CRM. But that guy is working so much in his business.


Tim Ryan: That he just doesn't have time to do all the things he knows how to do. It's not that he's dumb, but these guys aren't dumb. Like he built a million dollar plumbing company from scratch.

Like that's not a dumb person. Like you're not going to come in with like this new profound knowledge and

John Wilson: Yeah.

He is a finance guy, Yeah.

Tim Ryan: But like, it's not, I do think it's like when you're in a corporate world and making a lot of money doing finance or something like quotation sophisticated that you do look at like a thing like pool cleaning company or plumbing company.

And you're like, you feel like you do have this, like, Call it like you think your college business degree is going to come into play. And it's just not like, it's like how you're tan and how much you can suffer is going to come into play.

John Wilson: Yeah. I think it's hard to understand until you're in it. Because I think it's hard to conceptualize the fact that you're going to be cleaning pools. I try to tell everybody that when they talk about plumbing. I'm like, yeah, I want to buy a plumbing company. I'm the finance guy. I'm like, at one, have you ever talked to a plumber?

Like, actual question, have you ever spoken with a plumber? And two, like, do you know how to drive a truck? Because you will have to. And three, what's a channel lock? haha,

Tim Ryan: Man? I'm telling you,

Jack Carr: What's a channel lock? I'm stealing that one.

Tim Ryan: It's a good question.

John Wilson: It's a good question. Yeah, it's a good one.

Jack Carr: I'm glad you phrased it that way though, where you didn't give us a number. You actually just gave us a kind of model cause we run into that a lot too , in HVAC and plumbing is people see the 1 million. Oh, once I get to this range, I'm ready. Like that's a viable business at this multiple and reality, right?

You can make, you can run hustle and run a hundred routes yourself and make you know, 80, 000 or like we talked about that step up mechanism, you could have an office manager in place and a service tech in place and you can still make that same 80, 000, but the net is going to be so much lower in the take home at the end of the day that realistically you should be buying a smaller net business than the bigger net business where you're just buying a job. So long winded, I appreciate that response because we run into that a lot. More th I'd like.

Tim Ryan: Yeah. I get deems from guys wanting to buy pool companies like every week. I anticipate that's going to increase.

John Wilson: Yeah I think so. It's interesting. It's route based.

Tim Ryan: it's easy to wrap your head around.

John Wilson: Yeah, because I think especially, you know, it's the cycle, right? Vets, HVAC, plumbing, roofings having a moment, pool cleaning seems to be about to have a moment. Which is sick. That's cool. But yeah, I would imagine it becomes like the hot chick at the bar.

Like 2024, pool companies, the hot chick, the bar.

Tim Ryan: I think, these sweaty businesses are the hot chick at the bar right now. Before I got on Twitter, I didn't think what I had done was cool.

John Wilson: Same.


Tim Ryan: I was like, I built a couple of pool companies. Like I, whatever.

Like, and then I got on Twitter and people were like, wow, you're an entrepreneur.

You built a pool company.

I'm like, yeah. And they're like, I'm thinking about buying a business. And then that was my first time. I was like why you're buying it? We'll just start a business. Like, why would you buy a business?

And then like,

John Wilson: Yeah. It is having, I wonder how long it'll last. It seems to be getting more mainstream, like more and more, or maybe that's just the content that I'm consuming, but it's almost like,

Tim Ryan: I think it's just Twitter or Cody Sanchez is a big one.

Jack Carr: Seen a pop up on TikTok and stuff too now.

John Wilson: I saw it. I've seen it on other mediums from. Like very young people like 1920, like starting their what do I see on power washing or

Tim Ryan: power washing

John Wilson: Christmas lights.

Tim Ryan: it made service. Yeah.

John Wilson: It seems like, it's like capturing steam

Tim Ryan: Well, what, what captured you John or Jack?

John Wilson: Yeah. Jack

Jack Carr: Oh, that's a good one. What captured me was, I mean, you've heard my backstory. I was telling you before this. I've always been entrepreneurial not necessarily in the sweaty trades, but what brought me into the sweaty trades, specifically HVAC plumbing and HVAC first was my belief in 2022 was that a recession was on the horizon.

And so I said, what company is going to be the most recession resistant? And that was HVAC.

John Wilson: rapid HVAC scene Nashville, Tennessee.

Jack Carr: There you go. And now we're doing plumbing. Same thing. I love plumbing. I wish, if I could go back, I'd go plumbing first and then HVAC.

Plumbing just like so smooth chug, chug, chug, chug, chug, chug, chug, chug, chug. Right? Pest control would be a great one. You know, my fear is if I'd end up getting back in the field, I'm not knocking doors. Oh my gosh. My anxiety goes through the roof just thinking about it. I'm not personable like that.

John Wilson: If you like what we talk about on our social media, on Twitter, on this podcast, then you should be signed up for our newsletter. Go to ownedandoperated. com where every Friday we break down our business, we break down insights, things we're learning, things we're working on, and it's good stuff. Check it out, ownedandoperated. com.

And then Yeah, I mean, mine was multi generation family, is how we ended up in it. But, I agree. I did not think what I was doing was cool. I had never heard of another individual that was buying plumbing in HVAC companies, except for myself, until I joined Twitter in 2020. I had never heard of that, and then like, I, you get exposed to Twitter and it's like the hot chick at the bar for two years, plumbing and HVAC. It was like, what the heck? This is, like, I've been living this life for a decade, you people are interested in this?

Tim Ryan: jealous of you, man.

John Wilson: I didn't inherit it, I bought it, but it definitely was a leg up.

It's easier than starting from scratch for sure.

Tim Ryan: I know Chris Hoffman's background. Did he inherit it? Did he buy business?

John Wilson: He bought it.

Tim Ryan: He bought it. Okay. Like, but also like to buy a business that's already working,

John Wilson: Totally. And Chris came in at a magical moment and I did. So Chris came in it's not talked about very often, but it seems like it's starting to happen in pools from what you're telling me. But like 2014 was as disruptive to plumbing and HVAC as like Uber to taxis. Or like the freaking internet being invented.

Like, it was wild, where if you were there, at that time, today you have a massive competitive advantage. Google reviews, what's your CRM, how fast did you get tech enabled or tech driven cause those are the companies that are at scale now. Like, it was very rare a decade ago to have a hundred truck business.

There was maybe ten in the country. Now, like, I'm one, and I'm not a very, like, I'm not amazing. So it's somewhat common now to have this at scale business. But Chris, he bought his business when they were already doing 10 million of revenue, so they were already at some level of scale at the most disruptive point in the trade since, like,

Tim Ryan: Where did he get the money to buy his parents business?

John Wilson: I didn't ask.

Maybe SBA maybe seller. I did mine a combination of cash in a seller note.

Jack Carr: Yeah. Not to mention that both of you are in this kind of area too of geographical boom, right? So the whole Midwest post 2008 saw an absolutely explosion. I know when we were doing resident or real estate about 2012, 13, they were building like crazy in this area and renting them out. So I mean, you had a big influx of people to to the Ohio region.

John Wilson: We're the opposite. Our population's shrinking, but Columbus is doing what you're describing.

Jack Carr: Yeah. I'm talking to Ohio in general.

John Wilson: Yeah. Ohio in general We actually, it was a 10, it was a real risk in our business and in 2020 we had to make strategic decisions. To get out of it because the population of the city that we used to be headquartered in had dropped by like 30 percent over the course of a decade.

Like it was wild. So like there was nobody there anymore. That was one of the reasons we went on an acquisition spree in 2021 is to de risk our customer pool. and it ended which is cool.

Yeah, I'm trying to think what else I want to know about pool service. How would you rate it?

what did we rate it? That's it was like a three or a four,

Jack Carr: I think it was a three and a five.

Tim Ryan: Whoa. What's the scale?

John Wilson: So it's one to 10, like difficulty to start.

And so usually the things that we care about is like money's a big one, right? Like do I have to spend a half a million dollars to start this or 20 grand?

Jack Carr: Like a septic company or something has a high asset value

John Wilson: Yeah, so that, that's obviously going to be more complicated, or how specialized is the skill set for hiring people, how hard are new clients to get, so that's usually the things that we

Tim Ryan: Right. Okay. And 10 is really hard.

John Wilson: 10 is ten's crazy hard. do it. Yeah, ten's crazy hard.

Jack Carr: Ten's like, an aerospace company where you

John Wilson: Yeah.

Jack Carr: really high level skill and

John Wilson: I think the highest we've done was like seven, and it was probably a very high CapEx business

Tim Ryan: I would probably say pull care is probably a one to start like, it's so easy.

John Wilson: Yeah.

Tim Ryan: It's not that it's easy, but it's forgiving, the equipment cost isn't that much. You can BS your way through it.

John Wilson: Yeah.

Tim Ryan: You're not going to like, I imagine this, like what happens if you mess up repairing like an AC, like if you're BS and your way through that, It's not good.

If I mess up cleaning a pool, the chlorines higher, maybe there's some algae and like, they go hire another guy. Cause like,

it's just like, I BS my way through it.

John Wilson: That was something that came up in a DM today. Somebody was like, Hey, I'm thinking about buying a plumbing company or buying a concrete company. And my response, like the concrete company did foundation pouring for new houses. And the response was, what's the cost of a callback?

Like, the cost of a callback on a foundation is probably 15, 000. The cost of a callback on me, like, doing a plumbing repair wrong is like a couple hundred bucks. Maybe a thousand if it really went bad.

Tim Ryan: Or unless they're doing houses, then it's

John Wilson: Yeah, that, yeah, that's bad. But yeah

Tim Ryan: it. It's easy.

John Wilson: Yeah.

Jack Carr: And what

Tim Ryan: I clean pools of a Prius.

Jack Carr: Did you really?

Tim Ryan: Yeah.

Jack Carr: That's awesome. Hey, talk about low cogs though. Good efficiency on gas

John Wilson: How do you recommend people, like, learning the technical side of pools if this is something they're interested in doing?

Like, where do they get that knowledge?

Tim Ryan: Well, are you imagining like a finance guy, like going out to start his own? Like, what do you, who you imagine this person is?

John Wilson: Some scrappy, 26

Jack Carr: year old.


John Wilson: human that's, like, ready to do something.

Jack Carr: He's working at a moving company. He's trying to figure

John Wilson: Yeah,

Jack Carr: to with his

John Wilson: life. A moving company.

Tim Ryan: all right, all right.

Half Mexican working at Panda

John Wilson: Yeah.

Tim Ryan: just get a job in the industry. Like you're not, if you're 23, you're probably not making that much money. Like you're probably, you can probably, transition. Yeah. I think working for a company is the best way to learn it. If If you're working for a company and you're just paying attention, like that's the best way to learn it.

John Wilson: How quick do you think you learn? Like, two

Tim Ryan: Uh, you, I, you could teach it. I could learn how to clean pool, teach somebody how to clean pools in two weeks. Like that part's easy. The part of, this is the tricky part is if we, for most of your new customers, they're not coming to you with a good pool. They're probably coming to you with the problem and uh, it's your job to solve the problem to earn the right to clean the pool. To learn that side of it, that might take six months, a year of you just doing it. But I mean, you could also just find a mentor, right? So like, I actually, there's a guy in San Antonio who he did this and, he actually worked for me a long time ago. And then like a year later decided to start his own, but he just calls me when he gets stuck.

He's like, dude, this pool's green. How much chemicals should I put in it? And I'll be like, do this, and this. And then magically it goes away and then he learned, he's paying attention. So like he just, you can, you could do that. You could just find a mentor.

John Wilson: Yeah. I'm imagining like YouTube classes. Is that a thing? It's probably something.

Tim Ryan: Yeah. But it's not, they're not that great

John Wilson: Okay. All right. So

Tim Ryan: you

John Wilson: enough to like really build off of.

Tim Ryan: Because every situation is so unique. You could de green a pool one way and go to the exact same pool the next year when it's green again, and the de green doesn't work for whatever reason. And you're like, why, like, why is this not working?

It's like this year, I mean, like the chemist, like think about all the things that can dissolve inside of water

John Wilson: Oh, yeah.

Tim Ryan: I actually, when I talked to customers, like we're more like doctors. So like, I'm going to give you, we're going to start at the most likely reason that this pool's green and not, and we're going to fix it. And if that doesn't work, we're going to do the next thing on the list. And if that doesn't work, we're going to do the next thing on the list.

And it's just like, you go down that list. And that list is, was just built over, doing it for such a long time.

John Wilson: Yeah. That makes sense. Man, this was awesome. I feel like this really flushed out Pool service to me. I want to start doing this with all the other business models we do.

Of like, us just totally bullshitting our way through what we think it is And then having somebody that actually knows what they're talking about come on and be like, Yeah, sort of.

Jack Carr: You know, in lieu of this episode what I've been chewing on, remember that one episode we did where we were, doing this model on like a catering company for private jets? And that's all I could think about was we need to get somebody on who does catering for private jets and that actually knows what the hell it is, because it's so niche

Tim Ryan: What a fun business to try

John Wilson: it was a really interesting business. Sometimes I think back to the gum blasters one of like that company, like steamed gum off sidewalks or something that was crazy

Jack Carr: it was like a niche pressure washing kind of

Tim Ryan: company

I saw the most niche business I've ever seen. Well, maybe that's not true but I saw one was it's emergency skunk services. So if your pet gets sprayed by a skunk, they'll drive out and they'll bathe it, de skunk it and give it back to you.

And they found it, their dog got sprayed by a skunk while we were at their house.

And they were like, what do we do? Like we can't bring it inside.

We can't like, and so they like Googled it and that guy came up and he's like, yeah, he was called the skunk master.

John Wilson: Oh my gosh. I have never thought about that being a professionalized service.

Jack Carr: There's so many great ones out there.

John Wilson: Oh my god. That's fun. Cool. Man, thanks for coming on today.

This was a lot of fun. Thanks for walking us through the pool business. Correcting us. But yeah, this was a good time, man. Appreciate you coming on today.

Tim Ryan: How many listeners you got?

John Wilson: Each episode gets a few thousand in the first week.

Jack Carr: Yeah,

Tim Ryan: Can I shout out my Twitter?

John Wilson: Yeah. Hell yeah. Yeah. If, yeah, yeah. Where can people find you if if they want to get to know more?

Tim Ryan: Yeah, I'm on Twitter. Kenzie's pool boy, K E N Z I E Kenzie's pool boy. And don't come to that, that handle to learn about pools, that handle. And I don't tweet about pools hardly ever.

So, uh, anything

John Wilson: but pools. Yeah.

Tim Ryan: No it's probably 50 percent pools, but.

Jack Carr: Now, software.

John Wilson: Software.

Tim Ryan: I make a lot of jokes. I was chugging a bottle of wine in a short amount of time for uh, dry January,

John Wilson: That sounds about right.

Thanks for coming on today. This was a bunch of fun. thanks for joining us.

Tim Ryan: Hey man. Thanks. Bye. 

John Wilson: Okay, that wrapped up our second part with Tim Ryan on the pool business. make sure you check out the original episode, I want to say it was about a month ago where we broke down what we thought the pool service business was like, and Tim came on and helped steer us straight. Thanks for tuning in.

Thanks for tuning in to Owned and Operated, the podcast for home service entrepreneurs. If you enjoyed today's episode, please hit the like button and subscribe to the podcast. If you have any questions or topics you'd like us to cover, feel free to reach out. You can find me on Twitter at at Wilson companies.

I'll see you next time.

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