Marketing Matters: 03 Bet On Yourself

by Emily Blackburn

In episode three of Marketing Matters, host Rich Harshaw interviews John Bartrom, founder and CEO of Jericho Home Improvements in Kansas City, a TOP 500 company.

Today’s podcast is an interview with John Bartrom. He’s the founder and CEO of Jericho home improvements in Kansas city. John has been a client of mine since 2015 and is a truly great marketer. He started his business in the worst possible time at the end of 2008 at the depths of the recession. And despite plenty of doubters, he quickly grew Jericho into the largest kitchen and bathroom link company in Kansas city. They’re gonna do somewhere in the neighborhood of about 15 million in revenue this year. He’s bold, he’s confident he’s successful. And I’m sure that his story and his ideas are gonna be both inspirational and instructional to you. I want you to stick around after the interview, I’m gonna play a few of Jericho’s radio commercial. So you can hear some examples of what the he’s talking about. Sound like in action. So let’s get to the interview.

Rich Harshaw

How you doing, John?

John Bartrom

Good Rich, thanks for having me on today. I’m excited to talk to you about the subjects.

RH

Yeah. You guys, are a TOP 500 company a few times over, if I’m not mistaken.

JB

Yeah. We’ve been, you know, all the way to, I think, 23rd. And then when you look at custom kitchen bathroom specifically, one of the two or three largest as far as custom bathroom, kitchen modeling in the country.

RH

Yeah. We’ll get into that a little bit later, but I know from working with you that it’s exceptionally difficult to scale a kitchen and bathroom remodeling company compared to, say, a window company or a gutter company or something like that. But let’s put the cart before the horse. Tell me about your company. What is exactly that you do? Let the audience know, you know, how long you’ve been in business, what kind of sales volume you do just to sort of set the stage of who you are?

JB

Yeah. I started the company in 2009, actually specifically in 2008 December. And we were fully operational and running in January of 2009. We have four divisions of our company. We have a bathroom remodeling division. We have a full kitchen remodeling division, where we go into a kitchen, basically gut the entire thing and then build a it back. We have a kitchen refinishing division where we can go in and refinish the cabinetry and, and put in granite countertops and really make the kitchen look amazing, make it look brand new for a fraction of the price of a full kitchen remodel. And then we have a granite countertop division. We have our own granite fabrication facility and we fabricate and install our own granite countertops.

JB

We’ve been in business, like I said, since 2009 and, you know, revenue this year, we’re expected to hit around 15 million. Last year we are around just under 13 million in total revenue. And you know, business has been really good. There’s a lot of challenges in this industry, I know, especially with our, like you said, with kitchen and bathroom modeling where there’s a lot of moving pieces and parts, and there’s been a lot of challenges over the years. But we’re a company that takes care of our employees and really a company that gives, and that’s I think the most important, you know, quality at Jericho is we give and, and we love to give.

RH

Yeah, we’re gonna talk about that in a little bit. Uh, the charity work that you do not only talking about it specifically and how that works and what you do, but also tying that into the marketing to a certain extent. Tell me about starting your company in the recession. I mean, December 2008, that was about rock bottom, wasn’t it?

JB

Yeah, it was. So I was, you know, right before Jericho, I was the national vice president for one of the biggest companies in the world and the biggest bathroom remodeling company in the United States. And that was Home Depot Bathroom Remodeling. And that was back when Home Depot actually owned that business. They had, we had, a thousand employees and, we were in eight large markets across the country. And the, you know, this housing market bubble hit in 2008 and it had, it had noticeable impact on our sales, I know at home Depot Bath. You know, a new CEO came into Home Depot, made the decision that they wanted to focus on the orange box and the stores and not have all these outside programs. And so they, they, they shut down our division.

JB

And so starting Jericho in the middle of this, you know, major recession, everyone around us said, you know, you guys crazy are for starting this company, but we knew we were gonna be successful because, we had a lot of motivation to be successful. And I think we had the the right recipe. And for us, it was a perfect time to get into this industry and be in this business because people stopped marketing, they stopped doing things that made them successful, and there was a chance to take a major market share. And that’s what we did. We came in, we took market share and we grew like crazy

RH

Now, but it with Home Depot, I don’t know how they marketed, but I’m just gonna make an assumption here, tell me if I’m wrong. You personally, in your role with Home Depot, didn’t really have to worry about marketing. You just had to worry about what you were in charge of. Sales, right?

JB

Correct. Yeah. Marketing, you know, the marketing was the store. They, we, had kiosks in every store. So an example, you know, Kansas City Market we’re at here had 17 Home Depots. And so we had kiosks and every one of them, we had someone manning that kiosks and setting appointments. So when someone walked by, they would say, “Hey, you know, you need a, a bathroom remodel?” And if so, they wrote the lead and it was a lead generation machine.

RH

But here’s where I’m going with this. That means that you personally didn’t have to have any particular marketing expertise, the business just kind of flowed in. So did you have any marketing experience prior to that? Because we’re gonna get into it in a minute when you started this thing. I mean, it took off and it went quick and it went fast and the marketing was amazing, but you didn’t have to do that before.

JB

Right. So with home Depot we did and I had no responsibility in that area other than the marketing we put together other for our, you know, materials for our sales reps in the house. When it came to getting leads, the stores took care of that. So my experience with marketing before, would be — so, Home Depot to start the Bathroom Division, they bought the company that I worked for. So I was a National VP for a company called Jubilee Home Solutions. We were in four markets: Kansas city, Minneapolis, Denver, and Dallas, and they acquired our company. So marketing-wise, before Home Depot, what we did was we were in the malls. So we were in Kansas City at that time had five pretty large malls in Kansas city.

JB

And we put a kiosk in those malls and we generated lead flow through foot traffic. We also did, you know, some print media, some mailers, and the home shows, and that generated fairly good lead flow. But, you know, the problem in 2009 was the De-Malling of America. So malls were going out of business. So Kansas city went from five, fairly large malls, had enormous foot traffic down to two from 2005 to 2009. And so that really wasn’t an option for us. So we really had to figure out, you know, how do we get , that was — to start the company, that was something that was on my mind is: how are we gonna generate lead flow to grow this business?

RH

Yeah. So before we move on from Home Depot, I know from working with you that we don’t do any of those kinds of partnerships and a lot of other companies around the country, even some of my clients, they partner with Costco or BJs or Home Depot to generate leads. What’s your feeling on that? I know what a lot of people feel about that. I’d be curious to know what you think about that.

JB

I think from my experience, what I’ve seen in other companies, I’ve seen that you’re more likely to put all your eggs at one basket going that route and really give Home Depot your company. And so I saw a company in Dallas that was in all the Home Depots in Dallas, and they killed it. I mean, they had so many leads and then they were generating an enormous amount of business, their business grew, and that’s all they needed to do because it generates so many leads. And one day Home Depot decided that they weren’t gonna be in the stores anymore. And they pulled ’em from the stores and having no backup plan, it basically destroyed that company. And so it can be risky when you rely on a source that your name isn’t [attached to], you know, as far as the customer’s concerned, that’s Home Depot. If we were to get in the stores, they’re not gonna advertise Jericho. And so the marketing we do advertises Jericho. So everyone in Kansas City knows who we are, and that takes a little bit of time to establish, but I would take our leads over any Home Depot lead, any other store lead, because of the knowledge that we’re able to create this image of Jericho and let our customers know exactly who we are. And it’s allowed us to become very successful at what we do.

RH

Yeah. Would you say that you could probably expect lower price points and margins on those types of leads?

JB

Yeah, definitely. I think, you know, typically a Home Depot, like in cap, or any big box store, it’s gonna be more along the lines of like an overlay or, like, a one or two day install. So it’s gonna be a lower price point, you know, the biggest thing I think you go up against is Home Depot, or these stores are gonna charge you an enormous amount of money for this lead. And so I’ve heard any, anywhere from, you know, on the low side, and this it’s been a while since I’ve heard this, but like 12 percent, more typically it’s like 18 percent, all the way up to 24 percent that you’re paying when you sell a job, you know, to these big box stores or any sort carrying in cap. So, you know, our marketing cost is substantially less than that. And we’re able to, at the same time, you know, be able to drive who we are to the consumer.

RH

Yeah. Well, and you know, again, from working with your company, I know quite a bit about you guys. I would say you’re definitely on the high, highest end of quality customer service. And I, I know your margins reflect that. Talk about your philosophy of pricing your services in that regard.

JB

Yeah. So when we started the business, we, you know, made the decision that we were going to make sure it, we took care of our top three core values, which encompassed them all are all about taking care of those that we serve. And that is our customers, you know, creating rating fans of our customers, taking care of our Jericho family, and then serving the orphan and abandoned child. And so in order to do that properly in order to really give our customers like the best install that they can, they can get anywhere you know, high quality install with the, the best products, you know, something that’s not gonna fall apart, but a true craftsman that that’s doing the job, right. I mean, those people get paid very when we take care of our people, better than any company that you’re gonna find in this industry.

JB

And, uh, and there’s, there’s, you know, I always say that, you know, there’s a difference between price and cost. You know, price is a, a one time thing and cost is a, a lifetime thing or lifetime of the product. And so there’s a lot of companies that can, you know, be priced less, substantially less than, than what we are. But as far as cost, I don’t think anybody beats us on cost because the project’s gonna last, uh, the bathroom remodel’s gonna gonna last. And the calls we get, having to go out and redo stuff the other companies have done we don’t have those issues with our customers.

RH

Yeah. I remember when we first met. This was 2015 when we finally got together kind of going on memory here. So I believe at that time you told me “We raised our prices by 15 percent…. five times in the last, 2, 3, 4 years.” I don’t know what the timeframe was, but I thought, wow, you start doing the math on raising your prices by 15 percent and then another 15 percent then another and another, and then five times. And, you know, that was 2015.

JB

Yeah. Right. We actually, you know, we looked the other day to see exactly where we’re at, you know, price point wise for 2015. And we’re more than double where we were, we’re more than a hundred percent where we were. We’re more than twice as much as what we charged in 2015.

RH

What’s your average sale now?

JB

Our average sale is around almost $40,000 and 2015, it was around $18,000.

RH

Now we’re gonna get into this in a minute. We’re gonna talk about the quality of the leads that come in and how to generate higher quality leads, but just as kind of a preview to that, I know that one of your major metrics that you track is RPL — revenue per lead.

JB

Right.

RH

Can you speak to that? I know your price points have gone up, what about your revenue per lead?

JB

Yeah. So revenue per lead is basically, you know, taking the amount of leads we run divided by the revenue that we generate and divide that by the amount of leads. So when we go out to a house, that is a lead. So if we go to the house and customers are not home, doesn’t happen very often, that counts as a lead. So that counts towards us. If we go out to the house and, you know, they want a roof and not a bathroom that, that counts towards us. So it is a pure net number. Um, I know sometimes numbers are tracked and you know, did not qualify because the customer wasn’t sure if they wanted to do the project or not, and that’s not counted. So every single lead is counted. Uh, so, so we know that there’s no excuses, it’s a net number and that’s how we track these.

JB

So RPL revenue per lead, to give you example: Home Depot Days. So, uh, our goal at Home Depot was a 1500 RPO. So for every 10 leads, we ran, we wanted to generate, you know, $15,000 in business. We started Jericho and our goal was 2000 RPL, and we fell just a little short of that the first year, the first two years around 1800. And then at the second year, we started peaking over that 2000 number. And then just things started just, you know, inching up, uh, throughout the years. And so, uh, last year, our RPL was $5,000. So for every single appointment, we, uh, we generate $5,000 in revenue. And so one thing we notice

RH

Interesting, cause that’s over triple where you were, but your price has only gone up a little over double. So you’re actually more efficient with the leads.

JB

Well, I, so, uh, you know, this, the 1500 RPL is back in Home Depot days. I would say our price has probably gone up maybe four times since 2007, 2008, but at the beginning we had 2000 RPL in 2015, when I gave you the example of that, we were more than, than double, uh, RPL in 2015, I believe was about about 3,200-3,500. And so, um, probably more closer to probably 3000 in 2015. The one thing we have noticed is when you raise prices aggressively, you know, some of the things we’ve had to do because of the cost of, you know, we’ve had to, uh, raise our master installer compensation, the guys that you, we have our own employees, uh, we have, uh, around a hundred employees and these guys are amazing at what they do.

JB

And our master installers back in 2012, 2013, these guys made about $45,000 a year. Today they make about, they make over a hundred thousand a year because it’s become a huge challenge getting these guys. And so we’ve had to, you know, we preach the things all the time and so you have to live it. And so we had to make a conscious decision to be super aggressive in what we pay. And, and, uh, so 2015, you know, we were able to RPL wise, like I said, about $3,000 compared to today around a little over $5,000, the thing we, you sacrificed a little bit when you aggressively raise prices is closing percentage. We have noticed the closing percentage ticked out a little bit. Our goal has been to maintain closing percentage, but let me give you an example. So last year in January, we were selling so much business, production couldn’t keep up and we can’t hire guys quick enough to keep up. And so I made a decision to have the most aggressive price increase, I mean, in company history. And we raised prices 25% in, uh, February of, uh, of last year. And then we raised it—

RH

2021.

JB

Yep. And then we raised another 18 percent in May, and then we raised it another 8 percent in November and then another 25 percent in February of this year. So—

RH

Now that, that 25 and that 8 percent, a lot of that has to do with just the whole economy insane right now. And material has all gone up and all that, right?

JB

Yeah. So the reason we did it were for two reasons. One is because everyone knows prices, cost materials has gone up, the labor shortage in our industry. I don’t think there’s another industry out there that’s suffering the labor shortage that we are, especially when it comes to skilled craftsmen to do kitchens or bathrooms. And so those were major reasons. The other reasons were we, we couldn’t keep up. And so, you know, I could have cut back on marketing, but decided that profitability would be like, let’s test a price point. Let’s see if the market can handle this kind of increase. And so we for, I think the first time, I’ve always said in the past, we’ve always tested the, the price point and have really seen what, what the market can take this time.

JB

We really did when, when I reached prices, you know, 25, 18, uh, eight and 25 that’s, um, 74 percent in a year’s time that did it. And, you know, whenever you raise prices, at least from my experience, the biggest challenge is overcoming the sales reps’ mindset because, you know, they get told no, you know, usually more than they get told yes. And then, you know, the reason, no matter where you’re pricing, like the lowest price point or the highest price point, the reason’s gonna be, it’s gonna be either be they can’t afford it, or it’s gonna be price. The price is too high. And you know, we teach our reps and our designers, how to overcome that. But that’s the reason. So when you get bombarded with that, then you, you know, you raise price is 25 percent and you’re already more expensive than a everybody in the market.

JB

You know, you gotta psychologically handle your sales team and your designers. And you know, sometimes we have to be a full-time counselors to our sales team, but it goes to the territory that they’re great at what they do, but it is a high risk-high reward. They work their butts off. And so it can be, it can be challenging when you have that kind of aggressive price increase. So, you know, managing that. And then also I think we have that, you know, what the market will take as far as price point. And, um, yeah, it’s been an interesting study and we’ve learned a lot from it.

RH

Let’s go back in time to when you started again, because here’s the general outline of your story that I’m aware of. I want you to fill in the details you guys started out in, like we’ve said a couple times 2009, and my understanding is you spent what other people would probably call stupidly high percentage of revenue on marketing for the first few years in, in an effort to really just get your brand established and buy some market share, speak to that.

JB

Yeah. So we put together a business plan and determined that we needed to sell. Uh, we needed to be priced well enough to be able to have at least 10 to 12 percent of our revenue be generated on marketing. Of course, when you start a company, there is no revenue. So you’re spending that money ahead of time. And so that can be— understanding what your goals are and how you’re gonna grow. And knowing that ahead of time, you know, you gotta figure that out. And so I remember for us, we sat down and said, “Hey, this is what we’re gonna do. We’re gonna grow and within four years we’re gonna be a 10 million company, in four years.” And one of the first things we did is we went to some, you know, local banks try to get third party financing for our customers.

JB

And we got laughed at. We’re in the middle of this housing crisis and people are saying, “There’s no way, there’s no way you’re gonna do a million your first year and 2 million your second year and 4 million your third year.” And we said, “Well, you’re right. That’s not the, that’s not the plan. The plan is, you know, to do a million and a half and then three and then six.” And we got kind of laughed out the door, but we, we knew we were gonna do it. So we made a decision to start spending as if we’re a 1.5 million company. We started spending money on marketing to ramp, to get to that first year projection. And the first year was— we had to figure out how we were gonna generate leads.

JB

So we, you know, honestly, uh, to tell you truth, I, I was not 100 percent sure. I knew that we wanted to obviously do things like home shows and we were in the home shows. And we, we kinda had, you know, put things together for the home shows. And we did some direct mail and we got in some of the home improvement mailers that go out to combine a whole bunch of services together. And it wasn’t until we’re about four months into 2009 where we decide to do radio. And we started doing radio and we started doing AM radio, and we met a guy to do that. So we met a guy that had a marketing business that focused on radio. And his philosophy was there’s radio that you pay attention to and there’s radio that’s kind of background noise.

JB

And if you’re gonna be advertising during the day when people are working, you wanna be on the stations people are listening to not just the background music. And so we went on AM stations and so a lot of talk radio. And we had a couple of the people locally that did their local programs that had a following, and we had them do the ads for us, and we had success with it. So we had success there. And then we started to build, so we were on one station and then shortly went to two and then to three, and then sometime around the beginning of 2010, it was time to expand outside of radio. And that’s when we started doing TV. And I think we started doing cable TV and had probably the cheapest looking commercials that we’ve ever had in company history at the very beginning.

JB

Even the ones that were kind of cheesy and weren’t super professional looking, they had an impact and they worked, but where we saw the biggest jump is when we went from cable to network TV, and we started focusing on news programs. We started with NBC here in Kansas City, the NBC affiliate, and started having a lot of success. And the TV marketing not only was effective, but it changed our entire business. So when the business, the first year in business, we were doing what I would consider like a midrange bathroom remodel as cost versus value talks about that midrange out to that was, that was kind of our customer. And when we started doing TV, we picked the image and we picked the background, the customers were interested in what we were putting out there. You know, we noticed immediately, um, the average sale start to jump, and we noticed immediately our customer started to change a little bit, and TV really provided the platform to be able to truly show and tell exactly who we were and what we do. And, uh, uh, helped us create that brand that we have now

RH

I showed up in 2015. So that’s, uh, let’s say six years into this story, roughly how long did it take you to get up to being on all the network stations cause you were, when I got there and I think you had been for some time.

JB

Yep. 2013 is when that started. So we were on probably, uh, you know, I think maybe two or three of them in 2000 in the beginning of 2012, maybe two and then three by the end of 12. But in 2013 is when we made that jump. And, uh, we’re all in all of ’em. So, uh, you know, first year revenue at 1.5 million, second year, we did three, I think 0.2 third year was, uh, like 6.1, uh, 6.2. And then that was 2011, 2012 was a year we had to pump the brakes a little bit and we had to focus on infrastructure. I mean, we were still running the business off Excel spreadsheets and, and we, we were, we grew so fast that, that, uh, we, you know, we had a lot of, a lot of infrastructure to, to fix. And so we spent the first six months, 2012, um, you know, building, you know, some CRM software and, and payroll software and some things to help us run the business, uh, cuz we could not grow anymore. Cause it was, it was, it was, it was a cluster, uh we’re we, uh, grew really fast. And then at the end of the last six months of 2012, we, uh, grew rates some large price increases. And uh, and then in 2000, the last quarter of 2012, going into 13, we became incredibly profitable and um, started making, you know, great, great money, uh, from that point forward.

RH

So when did you finally hit 10 million?

JB

We hit 10 million in let see we did around 9 million, 8.8, 9 million. And then so I think we officially went over 10, 2015 I know we were at about 12 million.

RH

So this issue, cause I, I think this is a fascinating part of your story. If you look back at the percentage of sales that you were spending on marketing, you know, I, I think most home improvement companies would ballpark a round number of 10%. It goes up to 12 or 13. In some cases, some companies are down in the six, seven, 8%, but 10% of pretty standard percentage. And my feeling is that in those early years, you guys were way the heck over 10%, maybe as much as 20 or even 30% in, in some of those early years.

JB

Yeah, no we, no, we weren’t, we weren’t that high. I know, we know we had to spend the money before, uh, before we made it, but we know we didn’t, uh, we didn’t wanna go in debt. We, we remain debt free throughout the, the, the we’ve never had to, to, to go into debt. And that’s one of the things that we’re really proud of, but we did have to spend, uh, more in those early years because we had to, you know, to be able to, to grow, we had to spend it before. And so we were spending around

RH

Where’d that money come, from out of your pocket?

JB

Right? Yeah. It came from out of the pocket, it came from the, the, the, you know, profits of the company. So at the very, very beginning, yeah, it came out of our pocket and uh, we were able to, you know, surprisingly, we were able to start the company with relatively a lot less money than what anyone could ever imagine, that it would take to start, uh, a company that would do 1.5 million its first year. And that just comes from, you know, having, you know, teaching the sales process and, and, and getting deposits from customer and then, you know, using that to fuel, to fuel growth. And, uh, we, that’s what we did. We dumped, you know, we dumped money back into the company to fuel that growth. And, um, it took until 2013 for us to start making, you know, substantial, substantial income because of that growth. But we were probably, you know, to answer your question probably 13 to, to, to set percent in marketing probably more the first year, year and a half. Uh, and then that was slowly started to taper down to where it is now. It’s like 12, 13%.

RH

I remember in 20, I think it was about 2012 or 2013. I, I read this article. It seems like a little bit of a tangential point, but I I’m gonna bring it back to you. I read this article about Amazon and it was talking about how their stock price was just getting hammered because every quarter they’d come out and they would never make any money and they would never make any money. And everybody’s getting really frustrated cuz by 20, you know, 12, 13 they’d been in business long enough, everybody knew ’em, but they couldn’t make any money. They never made any money. They never made any money. And I read this article kind of down, like in the third, fourth, his sixth paragraph or something, it said, yeah, the reason they’re not making any money is because every time they make money, they just jam it. Right. They get back into the business and they expand in other areas and they grow the areas that they have. And then sure enough, I don’t know when it was maybe 20, by the way, I did buy stock in Amazon when I read that article and that turned out really well for me because it finally, they were making so much money that they didn’t have to put it all back yet. Right. I feel like your company’s kinda that same way.

JB

Yeah. That’s exactly what happened. That’s exactly what happened in, in the end of 2012, beginning of 13 was, uh, it, after, you know, we made some internal, uh, infrastructure changes. We were ready to push back on the gas pedal and increase. And uh, we knew we had the secret recipe. We knew how to market. At this point we knew if we spend money on marketing, exactly what to expect. We knew what we’d sell when we got those leads, we knew what a, our, you know, installation costs were our material costs. And it was just a matter of making sure that we had the infrastructure and, you know, back then hiring master installers, it was easy. We put an ad in, in, uh, Craigslist for 25 bucks. We’d hire eight guys. You know, now we spend $30,000, uh, uh, to find, you know, one or two. And, um, uh, so it’s a different, it’s a different world now than it was just 10 years ago. But, uh, but the recipe

RH

Was there temptation in those early days to wanna take more of the money that you’re making and pull it in, you know, into your own pockets for your family.

JB

Um, not, you know, not we had a plan and, and we were sticking to that plan. You know, what came in, uh, excess to that. We increased our conversation of our employees. We changed, uh, and increased how we gave back. And, um, we offered better services to our customers. Now we could expand there. And then when there was excess from that, then that came into ownership pockets, but we always, uh, you know, we, we were last all always to get paid. And I think when you have that kind of philosophy, when you truly, you know, love and care about, uh, the people around you, that we, you know, we have a family and, uh, um, I’d much rather have a company like that than, uh, than one where you have, you know, constant turnover and, and issues. And, you know, we have our first show of, uh, of, of this user course. Um, uh, but we, uh, we have a great culture in our company and, um, you know, we love what we do, uh, that philosophy it’s, uh, it’s worked for us really well.

RH

Awesome. Let’s shift gears here a little bit when I got involved with your company in 2015, the idea in because you had a, you had an agency like a full blown regular advertising agency before that. And as I recall your comments to me when we first talked were, I just don’t feel like we’re telling our story well, enough. Talk about that.

JB

Like sometime around 2012, we, you know, we felt we outgrew the first, uh, the first agency we were with was just a, a one person, uh, agency. And this guy was, he was great. We loved him to death. He was like family to us. Uh, but we got, you know, to the point where he just wasn’t able to handle the, the things that we needed done, uh, for, for, for our growth. And so we had to make a change and we hired a, a true marketing agency. Um, and one that’s very prominent here in Kansas city and they really did a great job for us. They helped us, I think, uh, take that next step and helped us grow, you know, that next leap, but completely understanding our business, completely understanding our customer. I think there was a little bit of a, a wall there, and I always wanted someone that, that specialized in this, you know, when we do kitchens and bathrooms and we’re hiring, you know, a master installer, we’re not gonna hire a, uh, a guy that, uh, that does framing on a house.

JB

You know, we’re gonna hire an expert guy that specializes in, I always wanted to market a guy that, uh, that specializes in, in a home improvements that specializes in, in this industry, that service industry. And, uh, I started looking and, uh, that’s when we found you. And it really, I think really brought a complete next level to real, a lot of things, not just the messaging on TV, but also in, you know, things that we do internally, you know, before we see the customer and, and, uh, um, just different ways to handle, to do the home show. And I think the expertise you brought was exactly what I’ve always been looking for. And that’s someone that is an expert in marketing, but specifically an expert when it comes to the service industry, home improvement industry. And, uh, uh, from, I’ve been in this industry now for 22 years, 23 years, and, uh, uh, have a lot of us experience and, you know, your expertise is on that kinda level, uh, with what you know, with your trade.

JB

And, and so it’s been kinda a match made in heaven for us, and it’s allowed us to take that next step and, and lower our costs. That was the other thing too. The, with the marketing agency, our costs were, it was substantial, um, because we had, I mean, know full staff. And so, you know, when it came to creative and, you know, doing branding, you know, creating the commercials, it was expensive. And we were spending a lot of money on that, the production part of it. And, you know, we were able to, you know, with, with having you take, you know, complete ownership of it and work directly with me, you know, I think save a lot of money on that side of it. And that allowed us to put more into the spending on, uh, on TV and on radio and allowed us to generate more revenue and, and to grow.

RH

Yeah. I, I think we also were able to negotiate those contracts with the, the stations to, to get some additional bank for the buck.

JB

Yeah, absolutely.

RH

You know, one of the things that I was impressed with, it’s when we started working together, you know, one of the, the podcast listeners have heard me talk about the concept of identity, explaining to customers with power, precision and passion, who you are, how you’re different, why you’re better, what they can expect when they do business with you ahead of time, right? The style of advertising that you were running primarily, I don’t wanna say exclude, but primarily it was more, Hey, we’ve got a promotion. If you call us now, you know, we’ll give you free. Granted, we’ll give you 20% off or whatever the number was. You know, when we sat down and talked, I, I said, John, tell me about your company. And we started going through these elements of quality and exactly what that means and how you do it and how you’re different. And I was just blown away. You got this amazing company. And when you look at their TV ads, they’re professionally done and they look nice and they’re executed well, but the messaging did not match what you guys are really all about. I don’t think.

JB

Yeah, I think, you know, the other thing that, that really, I think you brought to the table was, was helping us really tell the consumer who, who we are and tell Kansas city who, who we are, and, you know, not just why we’re different, uh, as far as what, what we offer, but how we’re, how we’re different, um, internally, you know, how we’re different culturally, you know, what we do as far as, you know, uh, because there’s there’s. And one thing that we do, it’s not kitchens of bathrooms, but it it’s, it’s changing lives and it’s doing amazing things and it’s as much of a, a part of Jericho as anything else. And we’ve never really told that story. And, uh, and this allowed us, uh, a chance to kind of, you know, tell Kansas city to, you know, tell the audience, you know, who we truly are and, and, and what makes this different and how it’s gonna be different in your home and how our company is, you know, night and day above the competition in service and quality, but, but also in heart. And, uh, it’s been really fun telling some of these stories and, um, our customers, uh, you know, here all the time, you know, they love our company. They love what we do. They love our spots. And, um, um, that’s exciting hearing those things.

RH

Let’s talk about giving back part of this because I work with a lot of companies and I would say most of the ones that are financially successful, they participate in some, either community service or charitable type things. And, you know, that’s commendable, I find in your company that it’s more foundational. It’s not like, Hey, we we’ve made money. Let’s give back. It’s like, this is the whole reason we exist in the first place. It’s for this. Talk about that.

JB

Yeah. So when we started the company, you know, I, I knew in my heart, I knew that one of the things that I wanted us to be different on when I look at the other companies that I’ve spent time with and worked for is, is I wanted Jericho to be bigger than just kitchens and bathrooms. I wanted us to do something that would, you know, change the world have, have a true, true impact. And I mean, what we do in kitchens of bathrooms you could say is, is changing, mean people’s changing, you know, people’s lives. And, and, uh, they’re, I mean, they’re, they, you know, when it comes to kitchens of bathrooms, I mean, they just, they go nuts. You know, the, after the, after product is just so gorgeous and beautiful and such a night and day difference that it, it, uh, brings, you know, tears to people’s eyes, but I wanted it to be even more than that.

JB

So I wanted to, you know, be able to, to find an organization to partner with, to, to, to, to be able to give to that, that had a huge impact in this world. And so I began to do my research and I wanted to find an organization that, uh, um, that was, uh, incredibly efficient. I know there’s a lot of charities out there that do a lot of good, um, but they’re, uh, maybe 50% or 60% of what you give actually goes directly to the people or the situation at need. And the rest goes to cover a lot of overhead expenses, cause the might not be run a, you know, efficiently and ended up being introduced to someone in 2009. Uh, his name was Mike Fox and he was the founder of the global orphan project. Um, and, uh, incredibly successful business guy. This guy, uh, was very, very successful in the propane business and owned one of the largest propane companies in the country and sold the company.

JB

And, uh, got invited to go to the Philippines, uh, to see an orphanage and possibly participate in helping fund build it. And long story short, you know, he went on the trip and it, uh, it wrecked his heart and it changed his life. And he decided to kind make that his next, you know, mission life. This guy is a brilliant business guy. And so, you know, he started this organization and ran it like you would run a successful business and so incredibly efficient and even more so he covered the entire overhead cost. And then, you know, today, the there’s a group called the, of us called the founder circle that cover all the overhead costs. Uh, so everything anyone gives, um, goes directly to help, uh, or, or offend and abandoned children. Anyway, I said like, everyone else, you know, when Jericho becomes profitable, we’re gonna start giving, uh, part of our profits away.

JB

And that philosophy changed, uh, around 2011 of 2011. We, uh, started having conversations about what if we start giving before profitability? What if we make a decision to give, uh, almost on faith, almost like we did with, with, with marketing early on, uh, let’s give a percentage of revenue. And of course, you know, we weren’t profitable yet. We were growing the business and there was money coming in and we were using it to, to fuel growth, but there wasn’t a lot of money left over. At the end of the day, or weeks or month, it was a, a definitely a faith step, but I felt God wanted us to move in that direction. And so we made this decision. We said, this is what we’re gonna do. We’re going to, uh, start giving a percentage of our revenue. Um, we’re gonna make sure our employees get paid first because they did the work they deserve to be paid after that.

JB

We’re gonna pay this percentage of revenue to the global war project. And then after that, we’re gonna pay our bills. And I just felt in my heart that if we do those things in that order, then we’re never gonna have to be worried about paying vendors or anyone else. And so in 2012, the second, or the, I think the beginning of the third quarter of 2012, we started doing that. And, uh, crazy thing happened. We became profitable almost immediately after starting that process. And, uh, and so that’s what we’ve done ever since. And we’ve increased that percentage two additional times. And, uh, when we felt that, that we were, you know, called to do so, and, uh, the impact has been, has been substantial. We’ve, uh, had an impact on tens of thousands of children all over the world. And, uh, here in, even in, you know, in the United States and in Kansas city.

JB

And, uh, we do some really, really, really cool things, uh, with that organization. And then another organization called dare to share, which is a teenage outreach ministry. Yeah. I mean, Jericho is installing some awesome kitchens of bathrooms. We’re also helping a lot of kids around the world and, and, uh, our third core value is to serve the orphan and abandoned child. And, um, you know, it’s the, the, you know, the ones that get ignored, you know, the ones that often don’t get, you know, the attention or get helped. We have a calling to, you know, uh, to be there.

RH

What was it about orphans that touched your heart? Why not homelessness or poverty or what, whatever.

JB

So when I met, you know, I, I met, uh, I was introduced to Mike Fox, like I said earlier. I met him in first and we had a lunch together and, uh, really mutual friend introduced us. And, uh, this mutual friend kind of knew what I was looking for. And, uh, uh, at least in the general the general sense. And, uh, Mike is telling me the story about his, uh, organization that he has started and, and what they’re doing. And some stories. And, you know, this is a super successful business guy that anybody that owns a company would look up to and be like, wow, I want to be able to, to do this sort of the things that this guy has done, uh, business wise and, you know, just incredibly mature and wise, and he’s telling a story and he starts to weep right there at the table as we’re at this, uh, pretty nice, uh, restaurant and lunch, cuz that’s the passion he had in his heart to these kids when his passion for these children came through. Uh, I just knew that that’s it, that’s what I wanted. I wanted us to be a part of this, this ministry and part of this organization. And I just knew in my heart that this was, uh, this was where we were supposed to be. And that’s where it started.

RH

Tell me about some of the, the, I know you’ve taken some trips with the organization to some of the areas that are affected. Tell me about some of those experiences.

JB

Yeah. So, uh, we’ve been to Haiti five times and, uh, you know, primarily we have four orphanages in Haiti that Jericho helps fund and support. And you know, one of the challenging things that, that you run into, um, or the, the ministry, uh, with the global orphan project, one of the things that we ran into there as these, uh, kids start to age out, you know, almost in any country around the world at, at 18, you become an adult and you, you can’t have adults in an orphanage with, with kids. And so they age out and then they’re out of the orphanage and what happens after that. And so, you know, started preparing, um, education platforms of, uh, trade schools and finding areas where they can, you know, pick a trade and, um, helping them prepare to be, you know, successful as an adult, uh, has been a big focus and that then that’s, and the results have been, you know, amazing.

JB

And so one of the things that the global warfarin project started, uh, is a textile is, is, is clothing. And, you know, typically you go to Haiti, you go into a place that makes t-shirts, it’s gonna be a sweat shop. You know, it’s gonna be a place where there’s gonna be an incredibly low wage and those t-shirts are, are made like a commodity and shipped out. And the global orphan project wanted to find a way to partner with businesses United States that wanna purchase clothing, uh, like the shirt I’m wearing today, uh, either for their employees, uh, or for themselves personally. And when at mine, uh, basically pretty much almost the same rate or, or, or we’re talking about like 50 cents more to be able to have some work, not in a sweat shop, uh, but actually in a living wage. And, uh, and so that’s what they created in Haiti.

JB

And they had this amazing facility today where there’s, um, you know, hundreds of, uh, of patients that were all in the orphanage programs, uh, that are not adults that work in these, uh, like this is one example that work, uh, in this, uh, textile. And it is an amazing place. I I’ve been there several times. Uh, they’re paid about three times more than almost any place in Haiti doing the same kind of work. And they’re paying a, they’re paid a living wage so they can support a family. They can have a home. And, um, and so that’s, that’s one, another area is another big challenge was you have an orphanage, that’s the take care of kids that are getting an education in countries where there’s no government education, it’s all private usually and abandoned children. So mothers, you know, can’t provide for their children and would wanna give their children up because the orphanage can provide a better, uh, better environment and, you know, put the exception of abuse, the best place for Childs with their is with their family, with their parents.

JB

And so the global orphan project opened up their, their school and, uh, the, the, the orphanage so invited, you know, people in local villages that children and, uh, so they can get an education and, and, and get, get food. And, you know, that takes some money to be able to do those things. And so we’ve taken on, you know, uh, uh, the education kinda for everyone and, and, uh, uh, and you know, some other platforms. So, uh, Haiti, uh, we’re, I think 17 countries totally, or, uh, 17 countries and all, uh, been to, uh, Jordan and Lebanon with, uh, the global war project went there in 2019, the beginning of 19. And, uh, again, the same thing there, they’re, they’re helping, uh, a lot of, uh, Palestinian, uh, and other, uh, refugees they’re, they’re coming into Lebanon. And then Jordan that had absolutely nowhere to turn and, uh, and taking these kids in that are either abandoned or orphaned. And, uh, just, it’s amazing to see an organization that has so much heart and changes so many lives and just to be, you know, be able to be a part of that is, uh, has been an amazing journey.

RH

What do you, we see happening in the future it’s 20, 22 right now, fast forward, two years, five years, 10 years where where’s Jericho and John Bartram.

JB

Yeah. So I think, you know, when we talk about our, our, our three main core values pretty much encompasses the important elements of our company and, you know, raving fans. So taking care of our customers, creating raving fans, the area, I think that we’re are focusing on and where we’re gonna be is, uh, we’ve had some conversations with my leadership team on how do we take our customer service to the next level? I know we had one of our, someone from our leadership team visit a, a really nice hotel. I think it was Ritz Carlton and saw the exceptional service. And we just above and beyond, what can we do to make that customer have an experience? And it’s like, no other they’ll ever experience in this industry. And we’re flirting with some ideas. The goal is more personal contact for us. It, it starts to be able to increase our prices to where we can do those things.

JB

And, and also, uh, we’re talking about fueling the next level of growth. So actually almost intentional, uh, increasing revenue, but lowering the workload. And you do that through increasing the price in, you know, ultimately making less and doing, you know, during more revenue and, and, uh, having a little less business and be able to scale and grow on a national grow of the company nationally. And so that’s what we’re setting up to do. Uh, as far as taking care of our jerk employees were, were increasing pay in the company in a lot of areas. And, uh, we’re starting to, you know, about two years ago, we started doing, uh, things with our employees on a, a monthly or every other month basis. So, you know, bowling together, having picnics, um, you know, we do a Christmas party every year, but trying to get our employees involved in these activities.

JB

And even now planning a, a companywide trip where we can take all our employees on a, on a trip. And, uh, that’s something we’re hoping to be able to do in the next, uh, in the next year or two. And then when it comes to serving the orphan a abandoned child, you know, we’re gonna, you know, continue to be actively involved. And, uh, you know, some of the trips have, have stopped of some of the, you know, political climates in Haiti and other countries. So hopefully, you know, that’ll get to the point where we’re able to continue those trips. Cause I think it has a big impact when employees can actually see, you know, the work that they do, the impact that that has. So those are the areas that we’re, uh, gonna be focusing on and, uh, uh, we’re excited for, for our future.

RH

That’s awesome. Yeah. I think if people were paying attention to the numbers along the journey of our conversation today, they would see that your company has not taken a path that might be expected. In other words, you, you grew very rapidly in the first 3, 4, 5 years. And then in the last, what, eight or nine years, the top line revenues haven’t really grown, you know, at leaps and bounds, especially compared to some of the companies we’re seeing now with COVID and stuff. I mean, we’re seeing companies that we’re doing five that are suddenly doing 10 and 10 that are suddenly doing 20, but that’s not really been the Mo for Jericho. It seems like the, the Mo has been more let’s increase profitability so we can keep our people working at a reasonable workload and let’s focus on making money, not, you know, just necessarily top line sales.

JB

Yep. You know, I think, you know, for us trying to build a model that’s scalable, uh, at least on a national basis has been my goal. And course when you’re a business owner and, and you know, you, you have someone that a customer that says, Hey, I, you know, I wanna pay you, you know, $200,000 for a, a room edition. You start doing room editions, you start, you start adding some of these elements to your business. And what, you know, at least through my experience, I’ve learned that those areas absorb enormous amounts of energy and they, uh, they, they take all your time and they generate very little for, for the business and very little for the employees. And so we’ve gotten away from trying to do any kind of interior remodeling and focus specifically on what we’re really good at. And even in, like you said, even we’re actually doing less work than what we did in 2015 by, by a decent amount.

JB

And it’s, it’s intentional because we’ve realized that the biggest challenge that we are gonna be up against the next 10 years is finding great installers to do this work. And so, uh, because there’s just, they, they don’t exist. There’s a massive shortage cuz everyone that’s in their fifties and sixties, getting out of the main annual labor side of this business, there’s not someone in the, in their twenties replacing. And so it’s only gonna get worse. And so our idea was to focus on profitability, focus on our employees, focus on giving back, make a scalable model. And then when the time is right, put the foot back on the gas and, and uh, open up, uh, the next market and, and, uh, see if we can scale, you know, the goal is to scale to a hundred million in the next five years. And, uh, I think it’s, it’s, it’s possible. And, um, we’re, uh, we’re up to the challenge.

RH

Awesome. Well, Hey, thanks for spending some time today. It’s a great story. Great company. Appreciate you being a customer of mine for gosh, what seven years or something like that. And look forward to get helping you get to that hundred million.

JB

Loved it. Rich. Thanks for having me.

RH
Thanks for listening to the podcast today, as promised at the beginning of the episode, I want to play some of John’s radio commercials for you. So you can hear the principles in action. The first spot is called improving lives and it explains to the audience Jericho’s involvement with the global orphan project.

Improving Lives Commercial

When you use Jericho to remodel your kitchen or bathroom, you’re doing more than just improving your home. You’re also improving lives. It’s true. We donate a large part of our profits to charity, including the global orphan project based in Kansas city. Their website is gopro.org. Those funds pay for food schooling and other necess in Haitian orphanages. One of the most important things these sacred funds pay for is mamas. Mamas are women who live in the orphanages full time and nurture, feed and care for these kids. They’re not the kids’ mothers, but their love from the children is so great that they’ve earned the title of mama. Each mama is responsible for 10 orphans and Jericho is actively supporting 39 mamas in Haiti. That’s 390 orphans that now have a mama to love and care for them. I’m John Bartram and my company is Jericho home improvements, her kitchen and bathroom remodeling for should finishing, please visit Jericho home.com.

RH
The second spot is one that we put together a few years ago. It’s called how much does it weigh? And it’s a good example of describing with precision. One way that Jericho’s quality is superior to its competition. Take a listen.

How Much Does It Weigh Commercial

One of the most common questions we get about kitchen and bathroom remodeling a is how much does it cost? But the question you should be asking is how much does it weigh? How much does it weigh? Actually, you can tell a lot about the quality of a kitchen or bathroom by how much the faucet weighs at Jericho. We only use high quality mow and faucets. They weigh about 10 pounds. Each they’re solid metal. They look fantastic and they’ll last forever. Other remodel, their save money by using off brand plastic faucets. The only weigh about a pound and a half, 10 pounds versus a pound and a half. If you want a remodeling job that weighs right, call Jericho, find us online@jerichohome.com. And right now we’re offering a thousand dollars off. Any bathroom remodel or kitchen refinishing job, or $2,000 off any complete kitchen remodel.

RH
The last three, come from a series that we put together last year, that focus on Jericho’s core values of caring for people, customers, employees, and orphans. The three spots are called blind faith core values in making a difference. And they have been making a huge difference for Jericho in terms of sales. Thanks again for listening and enjoy these commercials.

This is John Bartrom owner of Jericho home improvements. People ask me all the time, why the name Jericho Jericho is a story of blind faith. The Israelites roamed the wilderness for 40 years before they crossed the Jordan river into Jericho and into promise. We started Jericho in 2008, right in the middle of the worst recession in 50 years. But we felt there was a higher purpose, more than just kitchens and baths. Jericho is about taking care of others, customers, employees, and more importantly, orphans and abandoned children. It’s about blind faith to fulfill a purpose, a mission, a calling. And that’s why we named our company Jericho, call us at (913) 596-0000. Or visit our website@jerichohome.com. This month we’re offering 10% off any complete project, but you must call 9 1 3 5 9 6 0 0 0 0 or visit Jericho home.com today.

At Jericho home improvements. We have three core values that guide and direct. Every decision we make, create raving fans of our customers take care of our Jericho family and take care of orphans and abandoned children. We take care of our customers by delivering high quality craftsmanship with no surprises. We take care of our Jericho family by providing a positive work environment with great compensation and benefits. But most importantly, we take care of orphans and abandoned children by partnering with the global orphan project and the care portal. This care provides food shelter, medical needs, clean water and education for tens of thousands of children in 12 countries, 27 states. And right here in Kansas city, do core values matter. You better believe it. Call us at (913) 596-0000. Or visit our website@jerichohome.com. This month we’re offering 10% off any complete project but you must call 9 1 3 5 9 6 0 0 0 0. Or visit Jericho home.com today.

We remodel of over 8,600 bathrooms over 4,100 kitchens and installed over 30,000 square feet of granite countertops. We currently employ over 85 people and serve over 700 customers a year. In short, we are the largest remodeling company in Kansas city. And with your support together, we’re providing caretakers known as mamas for over 1000 of banned children in Haiti, as well as providing food, clothing, clean water and education for over 10,000 children in 13 countries, 27 states, and right here in Kansas city on behalf of everyone here at Jericho, as well as the orphans serve through our partnership with the global orphan project and the care portal. I like to thank you for your support. And if you have a bathroom or kitchen remodeling project in mind, we be honored to give you a free design consultation and quote. This month we’re offering 10% off any complete project, but you must call 9 1 3 5 9 6 0 0 0 0. Or visit Jericho home.com today.

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