Show notes from episode 117 of the Sweaty Startup podcast.
After graduating from Penn State, Sam Evans made an unconventional choice for himself in forgoing a traditional post-graduation career to continue the junk removal service that he had launched two years.
While friends of his were taking corporate jobs throughout the east coast, Sam stuck to what he knew could be successful and is now pushing $180k in sales in 2019 with a 70% profit margin, and it looks like his bold decision has really paid off.
Early Growth
Every new business relies on that first humbling push towards generating leads and making sales. For Sam, this meant dropping flyers in local neighborhoods and guerilla marketing by posting on local Facebook groups, up to 40 a day so long as moderators didn’t block him from the group.
His first summer was rather slow, with relying only on his $1000 pickup truck and a pricing structure that undercut the competition. Since then, he’s raised prices to meet the competition, connected with local realtors for referrals, launched a website and purchased a dump truck with his decal on it.
Profit-First Accounting
Sam hasn’t taken any money out of his business yet, but utilizes an envelope system for accounting and allocates his income accordingly. He maintains multiple different checking accounts for his business, putting 1% towards a profit account, 3% towards owner’s compensation, 18% to taxes, and the remainder in operating expenses. This is similar to the envelope-based personal finance system popularized by Dave Ramsey.
Learning to Love Outsourcing
Sam tells us that his biggest learning has been that the tradeoff in outsourcing operations that lie outside of his wheelhouse, and says a 10% hit to margins to keep his accounting and CRM systems in place is a huge asset.
With all accounting, scheduling, and other processes either outsourced or automated, Sam estimates that he now has 10 hours a week that he can spend driving new business rather than stress over these tasks.
Highlights:
Growing more customers after the first slow summer [7:20]
Using the profit-first accounting system [11:05]
Don’t be afraid to outsource [17:55]
Also referenced:
How to start a junk removal company with Casey Walsh
Episode 44: Max Maher and the impact of guerrilla marketing