“Copy & Paste” Results

Hey there,

It is Matthew Larsen, back with my daily newsletter.

We are going to solve one of what I would call the “hidden” problems in business. This is what I would consider to be a problem that you have likely been unable to identify up to this point. This is one of those situations where you intuitively know there is a fundamental problem. It likely shows up in multiple areas of your business. You just cannot quite put your finger on it.

I have not really heard of anyone else talking about this and this may explain a lot.

The simple truth is that unless you are able to essentially “copy and paste” your results between clients (and whenever you get a new client), it will become harder to scale. We will talk about this in depth here, but to understand why, we need to go over some theory first.

The Three Parts Of A Business

There are always three parts of a service business:

Of these three, one will always be the “worst” or what a lot of people will call the main constraint. This comes from something called The Theory of Constraints. This theory states that a system is only as strong as its most limiting part. Speeding up non-bottleneck areas does not increase total output.

So essentially what it is saying is that if your marketing is a 10/10, and your sales is a 10/10, if your fulfillment is a 2/10, your entire business will be a 2/10. This is a very big and very real problem with growing your business.

For most businesses in general, the constraint is always marketing. They can (obviously) do their service, and if you actually get them on the phone (sales call) with someone, they can do okay. They just cannot book calls consistently, or scale the volume of calls on demand.

Eventually The Constraint Switches From Marketing To Fulfillment

Believe it or not, the primary reason to choose an industry (or a niche) is not due to marketing and client acquisition. It is for fulfillment reasons. 

It does make it easier to get clients, as you become "known" in your industry for that, and all of your messaging, marketing and assets are all pointed towards that one thing, but you choose an industry primarily so you can scale your fulfillment.

Once you get past the beginner stages, getting clients is no longer the main constraint. It is fulfilling for them while maintaining quality, and this only gets more complicated as you scale. 

But, there comes a time for every business that sticks with it that eventually, their marketing starts to work. They really get it. Whether they do paid ads, content, outreach or partnerships, or a combination of all of them, booking calls eventually becomes as effortless as tying their shoes in the morning.

This is often hard to believe for people who have not gotten to this stage, and admittedly, most never experience this, but it is true.

It is not that hard to conceptualize in my opinion. Eventually, you will have tweaked your offer enough, found some ads that get the right people to click, and gone through enough iterations of your landing page and VSL. I think it is easy enough to visualize, but still hard to “accept” until it has happened to you. It is a rite of passage and a mindfuck when it happens to you.

So, eventually, fulfillment turns into the next biggest constraint, or more specifically, maintaining quality of work and results as your team size increases and you are either one or multiple “layers” away from actually doing the work.

I will say that sometimes the biggest constraint could be sales, but this is not usually the case. It can be the constraint, but on average, it is nowhere near as difficult to hire 1-2 closers and train them up (even through sheer dumb luck) as it is to maintain quality when you go from something like 10 clients at a time to 100 or 1,000.

So, How Do You Maintain Quality?

I am going to present you with the solution here. You should keep in mind that this solution will not perfectly “fit” for a large percentage of total businesses.

Many would (and will, trust me) have to redesign their service to make it fit into this framework. Some, which we will talk about, will have little or no opportunity to do this. 

What should they do about this? There are no easy answers. If you already have a business with no possibility of fitting yourself into this framework, I would NOT burn your business down or get discouraged or anything of this nature. I would simply recognize that scaling fulfillment will just simply be harder for you. That does not mean it is impossible in any way.

Regardless if it fits perfectly for you, you should take the lessons behind it and apply them. That will be a great start for you.

In any case, the way we scale fulfillment is by being able to “copy and paste” results.

Now, what the hell does that even mean? Copy and pasting results?

It simply means that we need to choose an industry where the work for every client is standardized, and in a very real way, whenever we get a new client, we can just clone all of our assets, change the name, logo and website, hit publish and have a HIGH degree of certainty that we will get the same results.

I don’t think it is particularly difficult to understand how this would help us scale fulfillment. I think most people could easily conceptualize this, but I would imagine the skepticism lies in identifying under what conditions that this would be possible.

Industries vs. Non-Industries

To decide your path forward here, you first must identify whether you are in what I call a “real industry” or if you are in what I call a “non-industry.”

Let’s talk about non-industries first.

Quite simply, there are a lot of things that look like an industry on the outside, but they are actually not. This is true because every client in this industry will have almost NOTHING in common with each other in terms of the actual fulfillment you do. This is what makes it tough to scale.

Some examples of non-industries are:

There are many more.

Let’s take a look at Ecommerce in particular. Not because I want to pick on Ecommerce in general. I’ve grown and sold three Ecommerce agencies in my life. I know the industry well. It being a “non-industry” is the reason that I am no longer in Ecommerce.

Let’s pretend for the sake of argument that we have a Facebook Ad Agency that serves Ecommerce Brands. We do media buying, creative, all that good stuff. Nothing fancy or out of the ordinary. 

What is the problem here?

Can you guess?

Let’s develop the scenario a bit further.

Let’s say that our agency has 10 clients:

These are all clients that everyone would consider to be in the Ecommerce “industry” are they not? Of course. 

So, again, I ask you. What is the problem?

The problem here is that NONE of these brands have ANYTHING in common with each other, other than the fact they are on Shopify and are selling products to consumers.

Other than that, NOTHING.

That is incredibly significant, and it is something that MUST be understood.

How this plays out when you are serving a non-industry like this is that you find a winning ad or landing page for your collagen brand client. They are so happy. You cut the CPA in half! YAY!

The problem is that we cannot simply take this ad, and “recreate” it for our boat cover client, or our home good client, or our apparel client. It just does not work that way. The most fucked up part is that we likely cannot even recreate it for a different collagen brand client of ours because everybody has different packaging, brand guidelines, ICPs and so on.

In other words, we absolutely CANNOT copy and paste our results from client to client. 

This fact negatively impacts our business in several ways:

I could list 10-15 more things that are slightly different versions or problems of the ones above, but those are the big things.

It is not just Ecommerce and it is not just Facebook Ads. It will be every service you could possibly provide for every non-industry that suffers from this fact.

The problem lies in the fact that we just cannot copy and paste results. 

Ecommerce vs. Roofing

Now, let’s take a look at the other side of the equation. Let’s say we do Facebook ads for roofers. I don’t want you to mistake home services and roofing as the same thing.

I would consider “home services” to be a non-industry in almost every case (maybe something like SEO is an exception) because it is too broad. You cannot usually copy and paste results between clients. 

However, with something more specific such as roofers, you most certainly can.

So let’s say that we do a very standard, very typical lead generation service for roofers using Facebook Ads as the primary traffic source.

We may do something like:

Let’s choose this service because it is very similar to the Ecommerce Facebook Ad service so we are comparing apples to apples as best we can anyways.

Why does this work with roofers and not Ecommerce brands?

Because you can copy and paste results.

If I find let’s say 10 winning ads, a winning landing page, and a winning workflow to book calls onto my roofing client’s calendar (let’s say he is in Los Angeles), then I very much can simply clone this entire setup in San Diego, San Francisco, Las Vegas, NYC, Tampa, Miami, Detroit, Cleveland, etc. change the name, logo and domain, and expect the same results.

That is because it is standardized, and it is standardized because it is a “real industry.”

Go back to Ecommerce. If I find this winning collagen ad, I cannot literally just run that exact same collagen ad for a beef jerky brand. It is not selling beef jerky. That would make no sense to do, and if I tried to do that, I would be instantly fired, obviously.

But, even so, I cannot take the same angle or messaging or format or script and even rewrite it for beef jerky, as it is not nearly guaranteed to work.

However, it is basically guaranteed to work for the roofers, and that is because every service is identical to each other. That is the whole point and the overall lesson of what we are talking about here.

So, that still remains the magic question:

“Can I simply clone all my shit, put the new clients’ name on it, and expect it to work over 90% of the time?”

If yes, industry.

If not, non-industry.

This is why things such as SaaS, info products can be desirable to sell for a lot of people and why they seem to be able to scale so quickly. Assuming the SaaS and info products are good (not always a good assumption), then once they crack marketing (and a bit of sales), there is almost no limit to how much they can scale, very quickly too.

It is also why some of the BIGGEST industries are things like insurance, internet, phone, logistics, fast food franchises, oil, etc. 

Even though these are not B2B services in the way we are talking about, a lot of the time, once the original process or action is completed, they benefit from their own version of “copy and paste” results.

Below will be an illustrative example of what can happen when you provide the same service for the same price in a real industry vs a non-industry. It may seem shocking, but it is true, and the results can be pretty ridiculous when they compound positively or negatively on themselves.

Faster, Better, Cheaper

The reason why being in a real industry is better is when we are able to copy and paste results, everything in our business becomes faster to fulfill, cheaper to fulfill, and in most cases, provides a BETTER result.

That last part is what makes non-industry people cry.

When everything is “copy and pastable,” you can fulfill the service extremely quickly, with lower skilled and lower paid labor, and because you get better results, you can charge more too. 

Layer this on top of the fact that you will get a good reputation, plenty of referrals and will have so much more margin to optimize and then scale your acquisition, and you quickly see why some businesses scale so much harder than others.

Offer Standardization

The most important part of this (assuming you are in a real industry) is offer standardization, especially your frontend offer that you sell in your paid ads. If you have an upsell or recurring service, it is ideal if it is copy and pastable as well but you will have a little bit of wiggle room as the client already got the first result from you, you have no further acquisition cost, and they know, like and trust you already.

Why is offer standardization so important for your frontend offer especially?

There are many reasons:

The first is that all of your tech, AI, processes, SOPs, workflows, assets, templates, hiring and training is focused on, built around and optimized for a single standardized offer. This leads to heavy compounding learnings and improvements that again, make it faster, better and cheaper the more you do it.

You do not get this effect in the non-industries, as every new client is essentially starting over from scratch. 

Because everything is built around your standardized offer, your fulfillment costs will usually go down over time as it becomes more and more optimized, and your churn usually goes down over time (which makes your LTV go up).

This really, really does a good job to make sure fulfillment doesn’t become the constraint, which is what this entire business is really about.

BUT! It also does another thing too.

It also helps remove sales as the constraint because now, all of your sales hiring and training is also around this one offer, and you sell this offer so much that you essentially have optimized the process so much, that all of your hiring, training and the process itself is around selling this offer too.

You can get away with a lot “lower quality” reps when this is the case, or if you hire good ones, they will sell so much and earn such high commissions and brag to all of their other sales rep friends that you will now have an inbound stream or sales reps begging to work for you.

On top of this, the sales reps are usually much more effective and close at a much higher percentage or revenue per call because like you, THEY KNOW that the service is going to work. 

No matter how much of a piece of shit you are, it is very difficult to sell something that you know doesn’t work or has no value. This describes a ton of things in life. That will not be the case here. It will be the opposite.

The sales reps will go harder than ever before because they are selling something they feel good about. 

When you stack this on top of them recruiting their other high-performing sales rep friends or just the fact that your process is so optimized you can basically throw anyone in there and they will close, sales will almost never be the constraint ever again.

This is not the case in other non-industries because they have to learn so much nuance because every single client is unique, and they won’t have as much conviction as the results are inconsistent.

Positive Flywheel In Marketing, Sales And Fulfillment

When you get this all dialed in, everything will add up to a positive, self-improving flywheel.

Let’s talk about the factors that impact each:

Marketing:

Sales:

Fulfillment:

It is a really incredible flywheel that spirals (positively) out of control. When someone chad scales and you don’t understand what is going on, it is some version of this that they have created in their business.

The Final Constraint

Eventually, it will be so easy to book calls, you will be fulfilling your clients with high margin, low churn, and you will have an unlimited supply of sales reps begging to work with you.

In a real sense, there is one final constraint to overcome, and if you have gotten to this stage, you will probably have already overcame it (even if you didn’t know it was there), but this is:

2x+ Cash Collected / (Acquisition + Fulfillment Costs)

This is what we need to achieve if we want to Chad Scale. 

This basically means on your front end offer, you collect at least 2x more cash than your acquisition and fulfillment costs combined.

So, if you collected $5,000 (after fees) and your acquisition cost was $2,000 and your fulfillment costs were $500, then you would satisfy this. Most people never get anywhere near this, and it is almost impossible to do so at scale if you are in a non-industry. 

The reason for that is your fulfillment costs will spiral out of control as you are going to rely on highly-skilled, very expensive labor. Your acquisition costs will rarely, if ever “go down” and even if they stay the same, fulfillment costs will go up, usually faster than how much you are able to increase your price to compensate.

2x+ is so key because there is a big difference between being profitable and being cash flow positive. 

When you are getting 2x+, you instantly have the money to fulfill the customer and cover the acquisition cost, but you also have money to go acquire the next customer and fulfill them as well. Once you collect the cash from them, you have the money to go get the NEXT one and so on.

In this scenario, cash flow is no longer the constraint.

Once you have achieved this, you are basically constraint-free in theory. Reality will be different of course, but there will be almost no limit to how hard you can scale.

And it is all thanks to offer standardization and copy and paste fulfillment.

Hope this email was worth your time,

Matthew Larsen

PS. Work with me in my Skool group at https://skool.com/leadgenerationacademy