We’ve written before in CONTRACTOR about contractors who became rich in their minds before they became rich in their bank accounts — speaker and author Weldon Long, Kenny Chapman of Blue Collar Success Group, consultant Ed O’Connell, former owner of O’Connell Plumbing.
“Their mindset holds them back,” Mike Agugliaro says of the many contractors he’s spoken with and trained. “They only know what they know.”
Agugliaro was like many contractors — overworked, underpaid and ready to chuck it all. And then he had dual epiphanies. The things that he did and what he has accomplished since those two revelations a dozen years ago are why Mike Agugliaro, Gold Medal Service, East Brunswick, New Jersey, is our Contractor of the Year.
Agugliaro is an electrician by training. He entered East Brunswick Vocational in 1984, started working full time for an electrical contractor in 1988, got his license by the time he was 22 and opened his own shop with partner Rob Zadotti in 1994. Being good tradesmen and being good contractors were different things.
The focus for Gold Medal Services for 2017 is ‘sharpening the axe.’
“Our first 10 years in the business we worked a million hours,” Agugliaro says. “We had work, but we didn’t know what we were doing. It was seven days a week. It took a toll on us mentally, on our relationships and on everything else.”
In 2004, Agugliaro had his wake-up calls. His son was about to be born and he realized, “ … this will be crazy. I’m never home. I’m going to miss all of his games and all the little things he’ll do in life. Holy crap, something’s got to give or I’ll be an absentee dad.
And then Rob Zadotti walked into the shop and said, “I can’t take it no more. I’m done. I’m out of this.” Which made Agugliaro announce that he was quitting too. When Zadotti objected, they started talking. There had to be a better way and they intended to find out what it was.
So did they join a trade association or look for a franchise? Nope.
1-800-Got-Junk and Zappos
He looked at another company building a large service operation, 1-800-Got-Junk. He looked at Zappos. One of their suppliers believed in them so much that it paid for Agugliaro and Zadotti to spend a week at the Disney Institute. He learned from Dan S. Kennedy, author of 13 business books on sales, marketing and management, and from Joe Polish, the founder and president of Piranha Marketing Inc. and the creator of the Genius Network. They learned how other companies deliver world-class service. They learned how best-in-class companies handled operations, company culture, and marketing, and started applying the lessons one by one.
In 2004, they were billing less than $1 million. By 2006, they had turned the company around and started adding on services. Were their models other successful contractors? Nope. Agugliaro looked at Target and Wal-Mart.
“The idea was to be a one-stop shop that could serve you for anything you needed in your home,” Agugliaro says. “We started to see what other companies were doing like Target or Wal-Mart and we were seeing at least 10 years ago that convenience is the most important thing on the planet. Customers don’t have the time and can’t wait for multiple companies to come out to service them.”
‘The idea was to be a one-stop shop that could serve you for anything you needed in your home.’
Gold Medal Service today performs plumbing, heating and cooling, waterproofing, one-day bathroom solutions, indoor air quality, water filtration, standby generators and electrical service.
Gold Medal Service has a 15,000-sq.ft. building and it recently purchased another 10,000-sq.ft. building. It will run service out of one and the installation department out of the other. Unlike some franchise operations, Agugliaro believes the different lines of business should be run under the single brand name of Gold Medal Service. The operations occupy separate line items in his budget and have their own supervision, but they are not separate departments or divisions.
Agugliaro notes that the firm doesn’t need separate call centers, dispatching or trucks. They also employ what he calls “super techs” that can service multiple trades.
Multiple skills sets
“A lot of guys come in with one core skill set and our first task is to enhance that skill set to make them the best at what they know,” Agugliaro says. “And then, next we ask them what’s the service that intrigues them? It’s common for an air conditioning guy to want to learn electrical or for a heating and cooling service technician to want to do plumbing.”
Technicians do ride-alongs with other trades to get hands-on experience. Gold Medal Service conducts training in their facility in its warehouse, using both in-house trainers and factory reps. The firm previously had a dedicated training room, but the equipment inside became outdated so quickly that they scrapped it.
In 2016 Gold Medal Service grew from 150 employees to more than 190 employees, increasing its customer base from 100,000 to more than 125,000 customers. The firm increased its annual revenues to more than $28 million, compared with $24 million in 2015. Agugliaro was featured in August 2016 on CNBC’s Nightly Business Report discussing his story and the more than 90 national and international business leaders he has coached over the last four years to help grow their companies. He has spoken at various trade events, including Penton’s Comfortech Conference and Show. He has hosted multiple CEOWarrior events, including Fast Track and Warrior Circle events, and he hosts monthly CEOWarrior podcasts, which consistently get more than 2,000 downloads each.
Gold Medal Service has become self-sustaining in a way that allows Agugliaro to spend most of his time teaching other contractors. Most contractors were taught the business by some other guy who didn’t know anything about running a business, he says. They have no formal training in sales or marketing or management. They think that they aren’t successful because they’re too young. They think that they aren’t successful because they’re too old. They’re afraid. They’ve been punched in the face by a bad economy and bad hires.
Why am I here?
“We got to the point where the service company had run by itself for two or three years,” Agugliaro recounts. “My partner and I don’t even have an office in the building. So I began to ask myself ‘why am I here’ and it hit me that now I’m in a position to help people and change lives and to make that impact on business owners. It’s better to tell a hurtful truth than a comforting lie. You need to change, to grow, to think different. One of the things that will serve the people who read this is that there’s something they’re already great at, and the goal is for them to figure out what they are not great at and read a book or find a program and learn about whatever they’re bad at and improve themselves.”
The warrior part of CEOWarrior comes from martial arts, which Agugliaro has studied since he was 15. He’s 46 now.
‘Focus is understanding the outcome you want to attain and staying on your path with your plan without getting distracted.’
“Martial arts taught me focus, discipline, endurance, and training over and over again,” he says. “It formed me into a strong person. I learned that there’s always another level to strive for; there are higher levels of mastery. One worse [problem for contractors] than fear, the worst disease is lack of focus. If they have focus and discipline, they would achieve anything they want. The situation is worse than ever today. Everybody’s on his phone. The constant distractions are endless today. So you have to have discipline to stay focused. Focus is understanding the outcome you want to attain and staying on your path with your plan without getting distracted.”
Contractors need to learn marketing, sales and leadership, he says. There’s no business without marketing. There will be no money without a high-integrity sales process. There will be no wealth unless the contractor is an amazing leader.
“Work on becoming better you,” Agugliaro advises.
What Gold Medal Service is focusing on for 2017, says Agugliaro, is profitability. It’s “sharpening the axe” and taking its service to the next level of convenience to the customer to strengthen the brand. The team is working now to streamline and improve every single function, delivery of services, training and management.
Four core values
Gold Medal Service has four core values, he says. Number one is safety first for the contractor’s family and the customer’s. This is an industry in which we work on things that can kill you, like carbon monoxide and electricity. Core value number two is to deliver “Wow Service,” the highest level of customer service experience on the planet. Give the customer the quality of Nordstrom’s, but the emotional experience of Disney. Core value number three is integrity. And number four the company must be a great place to work — all for one and one for all.
Don’t ever give up, Agugliaro says, no matter where you are in your business, no matter how old you are. A lot of people at 60 think that they’ll live to be 85 and then be dead. But what if you live to be 100? Better start working now.