Miguel Loreto Has Grown His Oxnard, California-Based Business Almost 300% Last Year at a 25% Net Profit by Preaching to His Team the Importance of Serving One Customer to the Best of Their Ability.
by Bob Houchin
Only eight years ago, Miguel Loreto walked the streets of Southern California with a stack of flyers he created himself with a simple goal in mind. “For three days, I would pass out flyers. By that third day, I wanted to pass out a thousand. On the fourth day, I would wait to see if anything came in,” he recounted. “Oh my, that was not fun. One call a week. That’s what I was doing those days.”
“You know, that’s what I was taught: If you want to make a customer happy, you always have to provide full service. You treat that customer like they’re your only customer for the month. So, that’s what I did. Back then, that wasn’t far off from the reality.”
“My guys will tell you the same thing. We have a meeting, and I ask them, ‘How many calls do you need?’ They might say four. I’ll say, ‘No. You need one call. It’s all you need.’ I preach that to this day. You need one call—and you take care of that customer. If you do it right, you’ll have a customer for life.”
Miguel owns and operates a residential-service company, Ventura County Plumbing & Rooter, based in Oxnard, California. It generated nearly $840,000 in 2018, almost a 300-percent jump from 2017, and it’s on target to hit $1.5 million by the end of 2019. Most impressive is Ventura County Plumbing & Rooter finished last year with a 25-percent net profit.
The last 18 months have been a mixture of exhilarating and exhausting, but Miguel wouldn’t change much. His passion for service and penchant for hard work are finally bearing real, financial results. Miguel has traversed many a rocky road to reach this point.
Miguel Becomes a Marine
Serving people, working hard—both seem to be characteristics hard-wired into Miguel’s DNA. Maybe it comes with growing up in Escalon, a small dairy farming community in eastern California. More than likely, some of it can be credited to his long, distinguished career in the United States Marine Corps.
Eighteen-year-old Miguel in 1993 wasn’t quite sure what to do with his life, following a very short stint in college. His father refused to allow him to squander time. He took Miguel to a military recruitment office where he enlisted. The Marine’s tested him on a Wednesday, and Miguel was on a bus to San Diego for bootcamp by Friday.
“A complete life change,” Miguel said and then burst into laughter. “I grew up in a town of 3,000. San Diego was huge. I was like, what am I getting myself into? And then all these people are screaming at me. But 18 weeks after that I graduated third in my class.”
Miguel served 14 years active duty, traveled throughout the Pacific Rim, and served a tour in both Iraq and Afghanistan. By 2003, he transitioned into the reserves and began thinking about what he would do after he completed his service.
Miguel Finds Mentors
Two life-changing moments would occur for Miguel during this period. He would meet his wife of 10 years, Amanda. Miguel also stumbled upon a part-time job that would turn into a career that would eventually ignite an unbeknownst passion to be an entrepreneur.
The reserves provided Miguel with a great deal of free time. He was seeking work when he met a man, Dale Avery, who owned a little plumbing company. “He asked me if I was afraid of digging?” Miguel said and laughed once more. “I said to him, ‘No. I’ve been digging my own foxholes for a long time. I’m good to go. Trust me. He offered me the job making $10 an hour.”
Dale said something to Miguel that’s stuck with him to this day: “He said to me, I’m going to teach you how to be a plumber, but everything you’re going to learn is not for you to keep. It’s for you to give away one day,” Miguel shared. “I learned a lot from Dale for about a year.”
There are people you meet in life—that if you allow them—will take you under their wings and shape your future. Dale was one of those people for Miguel. But he would meet his most influential mentor in 2005 after getting laid off by Dale’s son who bought his father’s business.
Looking for a place to land, Miguel interviewed with Todd Liehr, the manager of a large plumbing franchise in the area. “He said to me, you’ve already been a go-fer for 12 months. You’re going to get a van and start running calls,” Miguel detailed. “Todd was the one who hammered it into my mind the value of providing full service on every call.”
For two years, Miguel worked for Todd, while also finishing up his remaining time in the reserves. He submerged himself in the trade, taking classes, and eventually earning his journeyman’s card. “The interesting part is when I decided to get my contractor’s license, Todd was the one who urged me to do it. He said, ‘We think you’re a good guy. You have the ability to grow, and we’ll sign it for you.’ That’s what got me going believing I could start my own business.”
The Recession Leads to Hard Times & Decisions
Miguel was making good money. He enjoyed working for Todd, and he liked the company. Deep down, Miguel felt, as the owner of his own company, he could make a difference in the trade. In his market, more than a few times, Miguel ran across other plumbers trying use high-pressure scare tactics to sell jobs. He wanted to build something that stood for integrity.
“In the Marines, we upheld our core values of making sure we took care of our people and the people around us. I felt like the same should be happening in the plumbing industry,” Miguel insisted. “That’s why I got started.”
Miguel focused exclusively on residential service, as he’d been trained. However, new construction lured him with its big dollars. Within two years, 2009, the economy crashed. Miguel was owed $1.5 million from general contractors—he didn’t see a dime. It was a turning point in his life. Miguel told Amanda he was shuttering the business and taking a job.
Miguel’s first call was to his friend and mentor, Todd. “He’s like, ‘Hey, it happens to the best of us. Don’t worry. You’re going to do great things. Work for me for a little bit, and then when it gets better, go back out on your own.’” Miguel said. “That was a rough time. I sold off everything. It was heartbreaking. But Todd gave me an opportunity.”
“We were on a job together, Todd and me, and he looked at me and said, ‘Listen, I know you’re coming off a rough patch, but why don’t you just focus on residential? Do what you do best! People love you!’ We had a long conversation and he really motivated me to give business another shot. He’s a great guy. I still talk to him once a week.”
When he shared the news with Amanda, she supported the decision whole-heartedly. “She really encouraged me. She said, ‘Hey, I got your back. I believe in you,’” Miguel continued. “That’s when I started printing out flyers and going door to door.” Ventura County Plumbing & Rooter had been resurrected.
Miguel Joins SGI & Almost Quits Right Away
From 2011 to 2017, Miguel scraped together a living while trying to grow the business. “It was me. I had a laborer, Salvador, who’s still with me. I got some occasional help from Adrian Martinez, who is now a full-time employee, but not back then,” Miguel said. “I was really doing everything—running calls, answering calls, marketing what I could. I wore as many hats as possible.”
One day, while at a parts store, Miguel saw a competitor who recently wrapped his van. Miguel wondered what that company was doing that he wasn’t. Miguel later discovered the business joined a best-practices group. “That moment motivated me to get on Google and search for successful plumbers,” he said. “I started reading about [Success Group International]. Honestly, I kept looking for negative feedback about SGI, and I couldn’t find one negative comment.”
Miguel noticed a Profit Day seminar being hosted nearby. He signed up and attended. Miguel couldn’t believe how many of his competitors were there—some of whom he thought were doing exceptionally well. By the end of the meeting, Miguel joined SGI. “I was burned out,” he said. “I thought this might give me the direction I needed.”
But Miguel did not go to Executive Perspective (EP) right away in Dallas. Instead, months passed. He got tied up with the struggles of business, and Miguel admitted he procrastinated. Out of the blue, he received a call from a local franchise plumbing company. It wasn’t Todd. This gentleman owned a host of shops throughout the area. He asked Miguel to manage one for a base salary of $120,000 a year.
“It was a ton of money,” Miguel said. “I called Ray [Last, SGI Vice President]. I told him I wasn’t going to go to Texas. I was taking this job.” Ray went on to tell Miguel a story with a simple morale: You can work hard making someone else rich, or you can work hard making yourself rich. Miguel didn’t take kindly to the lesson Ray attempted to impart, and he hung up on him.
“I got off the phone and I told Amanda, ‘You won’t believe what this guy said to me.’ She asked, ‘Why did that offend you?’ I didn’t know how to answer. I had been chasing this dream of building a business that would help my guys buy homes, have health insurance, have a great work environment, and be able to enjoy their personal lives. If I took this job, I think I knew I was giving it all up. I didn’t like what Ray had to say, but his story made me go to EP that September [of 2017].”
Miguel’s First Few Steps
“Extremely overwhelmed.” That’s how Miguel described his week in Dallas at EP. The information made sense, but he wasn’t sure how to implement it all. When Miguel returned home, he hid in his garage and formulated a plan. He committed to tackling one improvement at a time.
The first few steps involved making more money. Miguel immediately adopted the StraightForward Pricing® guide provided by SGI, even though the listed prices concerned him. “I needed to learn the presentation. I practiced in front of my wife and my kid. Then, I tried with customers.”
Thanks to Miguel’s prior service background, he knew to offer inspections on every call and provide options on every repair. “I didn’t have the money to print any of that, so I just used a legal pad. Heck, I didn’t have money for uniforms. I started off just wearing a white shirt and black jeans,” Miguel explained. “When I was able to consistently get customers to say yes to my presentation, my next step was implementing a $69 service fee.”
While in his garage, considering his first steps, Miguel took a few moments to contemplate what he was about to endeavor. “Before I did the pricing or the service fee—and I know this is going to sound weird—but I made a list of affirmations. You’re an amazing husband. You’re an amazing father. You’re an amazing businessman. I had a list. I recited it every morning before going on a call. It helped me get my start each day.”
Finding Leads & Tracking Customers
Now Miguel needed more customers, and he knew enough about marketing to know that what he was doing wasn’t working. “I was spending money stupidly on everything and anything,” he said. “I fired everybody and started cold-calling my customer database.”
First, Miguel called with a drain-cleaning offer. “I told people I could do it for $89 and my $69 service fee, which is what I wanted for that service anyway. Believe it or not, I started getting calls from that,” he said. “Then, I started calling people who I’d put a water heater in for two years ago. I’d ask them if they’ve had it maintained. No? Can I do that for you. People started saying yes to that.”
“Crystal [Name] is my office manager today. She’s incredible—very, very sharp. Among the many things she does for us is call our customers every day with offers,” he continued. “Those are your best customers—the people who’ve spent money with you in the past because they like you.”
Ventura County Plumbing & Rooter doesn’t rely strictly on cold-calling to generate leads today. It’s evolved greatly in a short time. Thanks to the recommendations from other members, he utilizes Possible Zone as an outside agency. It redesigned his website and helps him direct a comprehensive, digital-marketing strategy. “Today, I have the money to spend the 10 percent we need to grow,” Miguel said.
Once the phone rings, Miguel relies on ServiceTitan to track those leads and customers. “I didn’t have money for that initially. I was using a program called Breezeworks for $35 a month. Man, back then, I didn’t have the money to buy QuickBooks. I was using a ledger,” Miguel said and laughed. “A lot has happened.”
Improved Mindset
Those last four months of 2017, after attending EP and aggressively implementing some core changes, Miguel didn’t experience a windfall of success. Quite the opposite. “My average ticket was only $225 that whole time,” Miguel said while sounding exasperated. “For the first part of 2019, our average ticket has almost been $1,600 in comparison.”
“Every call I went on was a complete failure. And I’m not even kidding. People didn’t want me to be there. They didn’t want to hear about anything else—just make the repair and go. It was horrible,” Miguel said while chuckling. “I think the issue was I was trying to wrap my mind around how I was doing this.”
“Using this new presentation, I felt like I had to put on a show,” he continued. “Instead of worrying about what it all looked like, I got honest with people. I would say, ‘I’m not going to tell you that I know everything about what’s in this price book, but I’m going to tell you what’s wrong with your plumbing. And I’m going to show you what it will cost. That’s when my tickets jumped up to $750. That first quarter of 2018, I started killing it.”
“The price guide is a great tool. No doubt. But at the end of the day, it’s all about your attitude with the homeowner. That’s what sells a job. Not the guide.”
Training Builds Results & Culture
More leads and revenue gave Miguel confidence to begin hiring. He had to hire. He couldn’t keep up with his demand. Miguel finally could add Adrian full-time in March. He recruited Jose Franco in September. Both men have tremendous work ethics, and Miguel knew they understood the importance of service. Miguel found Fernando Hernandez through SGI Partner Hire Dimensions. He didn’t have a relationship with him.
Understanding the importance of training, Miguel onboarded Fernando properly. “He rode with me for three weeks, even though I really wanted to put him in a truck to start making money. But I wanted him to see and understand the model,” Miguel said.
Initially, Fernando would watch Miguel. Near the end of the onboarding, their roles reversed. Miguel quietly observed Fernando. “I knew he’d make mistake early on—but I did too when I first started with it. But by the fifth and sixth call, you could see him get comfortable, and his closing rate was great.”
Ongoing training happens every day at Ventura County Plumbing & Rooter. Miguel conducts a muster meeting every morning. It’s much more informal than it sounds. “We get together in this little area. Guys have coffee. I have a refrigerator in there. We hang out and talk about the previous day,” Miguel explained. “I want that time to build relationships with everyone. I want them to feel comfortable working here.”
Twice a week, Miguel conducts more formal training geared around enhancing everyone’s communications skills. He also fully utilizes Learning Alliance’s outside training. He’s sent people to Service Essentials and Plumber’s Advanced. Miguel himself is registered to attend Plumber’s Advanced soon.
“I don’t think you can ever stop training. You can never stop learning. You can always get better at what you do,” Miguel said. “I’ve trained my whole life, being in the military. In business, it makes you more money. And it affects your culture.”
Culture of Accountability
Miguel believes passionately in personal accountability. He talks to his team about it repeatedly. He tracks his technicians throughout the day using his software, monitoring their performances. If he sees someone only collect the $69 service fee, they get a phone call immediately.
“But every guy that sells something, I try to call them immediately and tell them great job,” Miguel explained. “I don’t care if it’s $3,000 or $300. I’m here to lift my guys up.”
In addition to the multitude of training meetings Ventura County Plumbing & Rooter has, Miguel carves out time once a month to go over the company’s numbers with everyone, too. He has a company goal of always generating $120,000 a month; however, he always pushes a goal of doing better than the prior month.
Miguel asks everyone to set personal goals, as well. They’re written on a big board in the office. “We sit around and ask ourselves how we can get better over the next 30 days. How can we improve? And how can we help one another reach our individual goals. Again, I want them thinking as team, supporting each other,” Miguel said.
“And everyone has written goals. Not just the techs. Crystal has goals,” he continued. “Even our laborer Salvador has goals. Accountability is part of our culture.”
Long-Term Goals
Miguel started Ventura County Plumbing & Rooter only 12 years ago. In some ways, he might say time has flown by. Should he pause and reflect on all he’s overcome in a little more than a decade, it’s staggering. The recession alone put thousands of contractors out of business. For Miguel, it’s another part of his long journey to building something special.
In some ways, Miguel has accomplished so much of what he hoped when starting in 2007. He’s paying his team well. He’s able to offer health benefits. And he finally built a business, rather than a just running calls trying to hustle together a living. Now, Miguel’s dream has grown. He’s set his sights for so much more, especially now that he’s learned so much in the last 18 months.
“I have long-term goals. I really would love to at least own 1 percent of my market here—be their plumber,” Miguel said. “In the meantime, I’m a lot more realistic. By 2020, I want to be out of the truck and managing the business exclusively. I’m looking now to find my replacement to make that happen. It will.”
Until Miguel finds his replacement, he’ll stay focused on making the most out of one call at a time. It’s gotten him this far, and it will get him that much farther. This is a success story still in the making.