We recently sat down with Lee Godbold, CEO and founder of Junk Removal Authority, Youtuber, and thought leader, who has shared the steps you must take to earn a junk removal business salary of at least $1 million a year. Junk hauling means big cash, and here’s your chance to learn from one of the best…Here are Lee’s tips and tricks to succeed in the world of junk removal and get to that first million dollars.
Before getting started: You need the right mindset
Starting a junk removal business isn’t all fun and games… It can be downright difficult, especially when you’re trying to get off the ground, become profitable, and create a junk removal business salary of $1 million a year. What this means is you’ll need to treat your business like an investment and not like a job with a steady paycheck. You’ll also need to reinvest back into your business until you hit the $1 million a year mark and live as cheaply as possible (unless you have significant savings or outside income.)
The beauty of junk removal is that it really is one of the cheap businesses to start and can be started with only a few thousand dollars. So, most of these tips can be implemented for free or for very little money.
Keep reading to learn how to make your first million from the junk removal business.
Step 1: You gotta look the part
Lee’s first rule is that you must look the part if you want to hit the $1 million a year sales mark. To create a successful junk removal business, you will need:
1. A clean, professional website that’s built to convert
When you build your website, make sure it’s clean, with a phone number that’s located “upper right, bold and bright,” and includes online booking services so prospective customers can schedule your services directly from your website.
2. Proper Phone Etiquette
This means having a quick response time, always answering the call, and creating a professional-sounding script that guides prospective customers toward booking a free estimate or an appointment.
3. Clean, well-maintained Trucks
This is crucial.
This is one of the only visuals that customers have that affects customer perception of your company.
Trucks should be clean and well-maintained, with your company name, website, and phone visible on your truck.
4. Uniformed employees
Your technicians should wear clean company uniforms to give your customers a positive and professional view of your company.
5. Education and industry knowledge
Yes, junk hauling means big cash, but remember, this is a long-term game, and success isn’t built overnight. It means a constant investment in your education and industry knowledge.
This can mean working with Junk Removal Authority, watching their free Youtube channel for business insights, or scouring the internet for junk removal business advice in order to grow your business.
Step 2: Advertise your junk removal business
If you’re serious about getting a junk removal business salary of at least $1 million a year, you’ll need to use more or all of these platforms to promote your junk removal business:
1. Build a website for conversions, with great SEO
Although junk removal really is one of the cheap businesses to start, SEO for a great website does cost a little more upfront. However, it’s really the only way to get a powerful web presence that’s set up with SEO optimization in mind.
Your site should look professional, have your number stand out prominently, and list the services you provide and your areas of coverage. When you’re up and running, you can use your site when you run Google ads, which will lead back to your website, which will let people convert.
A site on Google for a period of time will rank decently well, after which, you can start to do more Google advertisements which will lead back to your site.
2. Google Ads
This is where you should spend the majority of your budget after your initial site-building and SEO project.
Your Google ads should lead back to your website. If your site is built for conversions, it will prompt potential customers to call your business or even fill out an online booking form to request a service.
With Yelp, it really depends on the state you’re located in. In California, Yelp is widely used, while in North Carolina, not so much.
While you don’t have to pay for Yelp to start landing jobs, generally, you’ll place better in their rankings when you pay to play.
4. Home Advisor
Home Advisor is a site that’s great for getting more leads and one that Lee recommends getting started with from the get-go.
If you’re able to jump on calls ASAP and know how to speak to prospects on a call, you’ll be able to book jobs right then and there.
Junk removal businesses (as well as other cheap businesses to start) usually start by listing their services on Craigslist. This is free for you to list your service but attracts customers who are price-sensitive, so bear that in mind when speaking to any prospects from Craigslist.
6. Facebook (organic and paid)
If you’re showing 100% of the time on Google Ads, then you can definitely spend more money on Facebook paid ads and other forms of advertising.
7. Yard Signs and Graphics on trucks
Graphics on your truck can bring in thousands of dollars in revenue to your junk removal business. Make sure your business name, website, and phone number and large and clearly visible. It doesn’t need to be fancy or cost a ton of money on vehicle wraps, a regular vinyl graphic will do just fine.
Step 3: Get online reviews
20 years ago, real-world reputation was what mattered. Now what matters most is your reputation on Google, Facebook, Yelp, and prominent review sites.
Send reviews to people who you *want* to review your company, and don’t send them to those who you want to review. You must have great service before you try to elicit reviews – so don’t ask for reviews unless you’re sure you’re doing a great job.
You can also use Workiz junk removal service software to send reviews to the customers you want to get referrals from, with a special message and a link to your Yelp page listing, website, Facebook page, and more. You can even ask customers to review you while you’re on the job and send them a review request while you’re standing in front of them, which increases your review rate up to 80%.
Step 4: You need to raise your price for junk removal
The problem with the strategy of being the cheapest in your market is the fact that you don’t have the money to advertise and spread the word about your fantastic company. You have to be known for people to hire you. Most people struggle with setting their prices for junk removal and related services.
You can go cheap, but then you will not have money to invest back in your business and in the company. When Lee first started out, he was mostly picking up jobs through Craigslist and wasn’t able to place Google Ads, advertise on Home Advisor, or Facebook. When you’re looking for cheap businesses to start, like Junk Removal, you can fall into the trap of advertising on free sites with price-sensitive customers and operating with razor-thin profit margins.
However, if you’re on a razor-thin profit margin, you’re NEVER going to be able to grow your business. This is because the more you charge, the more money you have to put back into advertising, trucks, and people who are required to scale to a junk removal business salary of $1 million a year.
The lifeblood of your business is really in its advertising. So, when you charge more and raise your price for junk removal, you’re gaining extra funds to be able to put into your business, and re-invest in yourself and your business’ livelihood.
Take for example, 1-800-Got-Junk. Their average price per job is over $400 a job, Junk Doctors is $350 and an average independent hauler is $280. That’s a difference of $70 between an average hauler and Junk Doctors, vs. $120 between an average hauler and 1-800-Got-Junk. This is simply pure profit that can be reinvested into the business.
A common pitfall that junk removal businesses often face when they start out is poor budgeting. They start out by doing work on the cheap, they don’t want to take advantage of other people and cut them a break.
However, something you must realize in Junk Removal is that this is a service of convenience. What this means is that this is a service that 95% of people can do by themselves, but they don’t want to do it. People are hiring you because they’d rather be playing golf on a Saturday or going to their kids’ baseball game. So stop being afraid to raise your prices. While it’s true that Craigslist and Facebook Marketplace clients are price shoppers, you will need new clients that are not as price sensitive. Junk hauling means big cash, and a big part of this is knowing how to price jobs. Your average job price is one of your most important numbers in junk removal, so bear this in mind.
Step 5: Now systemize and scale with sound documentation and training
In order to scale to a junk removal business salary of at least $1 million, you will need a business system and checklists in place to ensure consistency amongst all your people.
- Document every task that you and your business do.
- Create checklists for beginning and end-of-day operations as well as for each job.
This is something that for sure takes time and effort to put into practice. However, you must be able to learn how to run your business, scale this and teach it to your employees via a documented operation manual.
You want to be able to have a training program where employees are an extension of yourself and can do just as good of a job as you. You can either spend months going about it and doing this yourself or contact Junk Removal Authority for their Operations Manual, which can be rebranded for your company for $1497 as convenience of service.
Step 6: Add trucks as needed
Sometimes junk removal business owners get confused about what comes first: trucks or advertising. The answer is simple. You must have demand in order to pay for the next truck, which will only come from advertising.
So, advertising comes first, and your advertising will pay for the next truck. One (reliable) dump truck can bring in about $300,000 a year or a bit more in higher-priced areas.
- Plan on adding a new truck every new round of $18-$20K in revenue.
- Get a reliable vehicle and don’t worry about making payments on the right vehicle.
- You cannot afford to go through long repair downtime.
How much can one dump truck or trailer make you?
If your pricing is where it needs to be (an average of at least $300-350 per job,) it can bring in $300,000 if it’s reliable and not down all the time (of course, regional rates will vary. San Francisco and New York City might cost $800 or $900 for a full load and so an average job might need to be based at $550.)
You will need to buy a truck for every $18-20k in revenue, for the first 3 to 4 trucks, then after every $30k, which will allow you to scale at an optimum level with fewer headaches. Most of your headaches will come from people and trucks, and this is a good way to avoid this.
Step 7: Add the right people to your junk removal business
Yes, junk hauling means big cash but it’s impossible to reach the $1 million a year mark if you’re performing all of the junk removal jobs yourself. You must be able to hire qualified people who can quote jobs and load the junk for you. Try to get everyone in your organization to where they can become team leaders.
It’s critical that you employ systems, realize you can’t do it all alone, understand that mistakes will happen, and deal with them when they occur. Focus on fixing them and making the customer happy, determine what the team member did wrong and take the appropriate steps to immediately correct it.
Don’t micromanage because you’re worried that people will mess up – this will hold back your progress, and mistakes do happen. You’ll just have to handle them as they occur.
What can you do to recruit the right people for your business?
The problem is that right now, it’s an employees’ job market – unemployment is at an all-time low, and most people who want jobs have them. As soon as a resume comes in, call the applicant and go over their resume on the phone. Tell the applicant that the phone call is the initial interview.
So, if the phone call checks out, they have the right availability (hours of availability) if they sound decent, have a reliable form of transportation, and say that they can pass a drug and background check, invite them to the office with the general manager.
If everything checks out, give them a tentative job offer on the spot. Then, if their references and everything else checks out, give them the job.
Bad employees don’t usually show up for the in-person interview, or they tend to quit within a few days. This is the best way to get the best employees in the door, according to Lee and Junk Removal Authority. Because if you’re not the quickest, someone else will nab them.
Step 8: You must know these 2 numbers when starting a junk removal business
When operating or starting a junk removal business, there are two main numbers you need to keep in mind: your average job cost and customer acquisition costs.
1. Average Job Cost:
As stated previously, the average price per job for non-franchise haulers is $280 – or less while franchises usually come in with an average price of $350 or more. If you can raise your average job price for junk removal by $70, that’s an additional $70 of profit for every job which can be reinvested back into your business, advertising, and acquiring more new business.
You also need to ensure that your average job price for junk removal is high enough to ensure you’re making money on each job. The only way to scale to a million dollars a year is to research this number and make as much profit as possible.
2. Customer Acquisition Cost:
a. How to calculate your Allowable Customer Acquisition Cost:
Add up all of the expenses you incur for your average price for a junk removal job. This includes direct costs such as disposable fees, labor, gas, your percentages for insurance (usually 3-5% of your income,) vehicle payments (3-4% of your income) wear and tear, payroll taxes, etc.
Do not include advertising in this. Take your average job and subtract out your costs and the number left is your allowable acquisition cost.
b. How to calculate your Customer Acquisition Cost:
This is found by dividing your advertising spend by the number of jobs: $1,000/100 Jobs=$10 per Job. This is how much you can spend to get a customer and break even. This number needs to be at least 0 at a minimum but ideally at least $50-$60 in profit.
Workiz junk removal scheduling is an excellent tool for making these calculations. As you grow, you will want to track the average job per tech, service, location, etc. Workiz reporting will allow you to see if a team member is lagging behind or where you’re falling short. If you’re missing out on $10 on 100 jobs, that’s $1000 of difference off of the bottom line.
Workiz allows this and has other great reporting abilities, so you can focus on getting up your average price per job and become more profitable.
Step 9: Build business relationships
The quicker you can get off the truck and become active in the community when starting a junk removal business, the better. You should be active in these types of groups:
1. Apartment Management Groups
This is a great way to grow your business. Just landing one apartment complex can amount to $2,500 a month or $30,000 a year. If you grow your referrals, you can scale to as many as even 8-10 apartment complexes.
2. Providing lunch for real estate offices during training
Sponsoring a lunch is a great way to schmooze and promote your business. If you sponsor a lunch, most real estate offices will let you pass out a leaflet and promote your business.
3. Join the local, national association of professional organizers’ chapter (NAPO)
This is a great database where you can look up and contact organizers in your area and pick up some extra work.
4. Local Chamber of Commerce
5. Local Rotary Club
Both the Local Chamber of Commerce and Local Rotary Clubs are a great way to meet people and pick up more work.
6. Create the dream 100
Get your business to where it doesn’t need to rely on you for every moment of the day. If you can come up with 100 businesses that can put out the word about your business – of course, it does take some time and legwork, and if you can work on these business relationships, you can really make a killing.
Step 10: Don’t get discouraged or impatient
The steps we have covered here are the concrete steps that Junk Removal Authority took to build a million-dollar-a-year business. Something you need to note is that there will be busy and slow times in this business.
Yes, it’s true: junk hauling means big cash. But, you must consistently work the formula provided for 2-4 years to hit that $1 million sales mark when operating or starting a junk removal business.
You must work through the slow times and stick with it. If you do and are in a good enough market, you have an excellent shot at hitting your mark. Remember, this is a marathon, not a race, and this has to be done over a period of time.
Most people invest everything they have for a month or two and think they should be earning 25k, 100k, etc. This is not a formula for instant success. It’s going to take time.
If you get impatient and give up, you’ll never make it. It’s just that simple. This is a long-term game. This will take about an hour a day to implement what you’re learning and a few years to see the fruits of your labor.
Step 11: Winning with Workiz Junk Removal Scheduling Software
Starting a junk removal business? Workiz is the perfect way to set your junk removal business up for success.
As you start to grow your junk removal business, you’ll need to find ways to save time, automate the manual tasks and keep your work organized and documented so nothing slips through the cracks.
This is where Workiz junk removal scheduling software comes in.
In order to be a professional, profitable junk removal business that can scale to $1 million a year (like Junk Removal Authority,) you need a business tool that includes:
- Scheduling for your team
- Team tracking and communication in the field
- Invoicing and Payment processing in the field
- Customer database
- Call recordings
- Ad spend/ROI tracking
- Online booking
Workiz Junk removal scheduling software can help you free up your time so you can focus on what really matters – building your junk removal business to a $1 million a year venture.