E-234 Pool Nation Podcast - Phase Two: The Balancing Act – Scaling Your Pool Business

Picture this: your pool service business has been cruising along smoothly with around 40 accounts. You've built strong customer relationships, established efficient processes, and everything feels manageable. Then suddenly, you're at 80-90 pools, drowning in work, and questioning every decision you've made. Welcome to Phase Two of pool business growth - what industry experts call 'The Balancing Act.'

This critical phase can make or break your business. It's where successful pool entrepreneurs separate themselves from those who burn out and close their doors. Understanding how to navigate this transition isn't just helpful - it's essential for long-term success in the pool industry.

The Four Phases of Pool Business Growth

Before diving into Phase Two, it's crucial to understand the complete growth framework. Pool businesses typically evolve through four distinct phases:

• Phase One - Foundational Stage: Around 40 pools, focusing on quality service and building relationships
• Phase Two - The Balancing Act: 80-90 pools, managing overwhelming growth and considering first hires
• Phase Three - Leadership and Scaling: 130+ pools, developing leadership skills and building teams
• Phase Four - Empire Stage: 200+ pools, operating a fully scaled business

As Edgar DeJesus notes in the podcast:

I've started to get a lot of feedback from pool pros about these four phases. And it's really interesting because I get a lot of conversations, Zach, from the people that are already on the empire stage or they're on the scaling stage. And they're like, man, if we would have done this and this differently in the first two phases, oh, my God, how much better we would have been.

— Edgar DeJesus, Pool Nation Podcast

This feedback highlights why understanding Phase Two is so critical - the decisions you make here will impact every future phase of your business.

Why Phase Two is Called 'The Balancing Act'

The transition from 40 to 90 pools doesn't happen gradually - it often feels like it happens overnight. One day you're comfortably managing your routes, and the next you're overwhelmed, working longer hours, and struggling to maintain the quality service that got you to this point.

This phase is called 'The Balancing Act' because you're juggling multiple competing priorities:

• Maintaining service quality while handling increased volume
• Managing cash flow as expenses grow faster than revenue
• Deciding when and who to hire for your first employee
• Balancing growth opportunities with operational capacity
• Preserving work-life balance as demands intensify

The challenge is that the skills and strategies that made you successful in Phase One may not be sufficient for Phase Two. You need new systems, processes, and often help from others to manage this increased complexity.

The Financial Knowledge Crisis

One of the most critical aspects of Phase Two success is understanding your financials. According to the podcast hosts, this is where many pool businesses fail:

What's the number one reason small businesses go out of business, right? And it's small businesses. I'm not talking big corporations, but the number one reason... it's financial knowledge. But within that financial knowledge, what is the biggest factor?... most small businesses don't know the cost of their service or their product, right? And then that leads to bad pricing. You're not pricing your products properly. And then two, it also leads to very slim profit margins.

— Edgar DeJesus, Pool Nation Podcast

In Phase Two, this financial knowledge becomes even more critical because:

• Operating costs increase: Vehicle expenses, equipment wear, chemical costs, and insurance all scale with your growth
• Labor considerations emerge: You need to factor in potential employee costs, worker's compensation, and training expenses
• Cash flow becomes complex: With more accounts, you have more receivables to manage and potentially longer collection cycles
• Investment decisions multiply: Every efficiency improvement or equipment purchase has a bigger impact on your bottom line

Understanding your true cost of service allows you to price appropriately and maintain healthy profit margins as you scale.

The First Hire Decision: When and Who

Phase Two is typically when pool business owners face their first major hiring decision. This choice can be both exciting and terrifying, as it represents a fundamental shift from being a solo operator to becoming an employer.

Key considerations for your first hire include:

Timing Indicators

• You're consistently working 60+ hours per week
• Service quality is declining due to time constraints
• You're turning down new customers due to capacity limits
• Administrative tasks are consuming too much of your day
• You have sufficient cash flow to support an employee for 3-6 months

Position Options

• Field Technician: Helps with actual pool service, allowing you to handle more accounts
• Administrative Assistant: Manages scheduling, billing, and customer communications
• Part-time Helper: Assists with your existing routes to increase efficiency

The key is ensuring that your first hire directly addresses your biggest bottleneck while fitting within your financial capacity.

Systems and Processes for Scaling

In Phase One, you could operate effectively using memory, simple scheduling apps, and basic record-keeping. Phase Two demands more sophisticated systems to handle the increased complexity.

Essential Systems for Phase Two

• Customer Management: CRM systems that track service history, customer preferences, and communication logs
• Route Optimization: Software that maximizes efficiency and reduces drive time
• Financial Management: Accounting systems that provide real-time insights into profitability
• Inventory Control: Tracking chemical usage and equipment needs across all accounts
• Quality Assurance: Standardized checklists and procedures to maintain service consistency

Investing in these systems during Phase Two sets the foundation for successful scaling in later phases. The podcast emphasizes that these operational efficiencies are crucial for protecting your business and family's future.

Customer-Centric Growth Strategies

While managing operational challenges, it's crucial not to lose sight of what drives sustainable growth - your customers. The podcast hosts emphasize the importance of customer-centric approaches:

We're going to go into a lot of the details of interviewing the customer. How do you make sure that you're not just chasing revenue to chase revenue and then all of a sudden have it backfire on you? Right. So what are the things that you need to do as a business owner to set yourself up and your employees for success in order to be able to achieve that customer centric?

— Edgar DeJesus, Pool Nation Podcast

In Phase Two, customer-centricity becomes more complex because you're serving more customers while having less direct interaction with each one. Strategies include:

• Systematic customer feedback collection to identify service issues early
• Personalized service notes so any technician can provide tailored service
• Proactive communication about service schedules, chemical needs, and maintenance recommendations
• Quality control measures to ensure consistent service across all accounts

The statistics show that loyal customers spend significantly more with companies that prioritize customer-centric approaches, making this investment in systems and processes financially worthwhile.

Preparing for Phase Three

Successfully navigating Phase Two sets the stage for Phase Three - the Leadership and Scaling phase. The decisions you make now about systems, hiring, and financial management will determine how smoothly you can transition to managing a larger team and operation.

Key preparation activities include:

• Documenting all processes and procedures
• Building financial reserves for future hiring
• Developing leadership and management skills
• Creating scalable systems that can handle 130+ accounts
• Establishing company culture and values

Every class will build on top of each other... when we talk about the ensuring financial security, protecting your future, your family, and your business, there's a couple of different things that we talk about. We talk about the financial side of it, right? So how do you protect yourself from the finance side? What are some of the common pitfalls? How do you set yourself up financially?

— Edgar DeJesus, Pool Nation Podcast

Conclusion: Mastering the Balancing Act

Phase Two of pool business growth - The Balancing Act - is arguably the most challenging phase for pool service entrepreneurs. It's where the rubber meets the road, and where many businesses either breakthrough to the next level or struggle and potentially fail.

The key to success lies in recognizing that this phase requires different skills and strategies than Phase One. You must invest in systems, understand your financials, make smart hiring decisions, and maintain customer focus while managing increased complexity.

Remember that feeling overwhelmed is normal during this phase. The successful pool business owners are those who acknowledge the challenge, seek help when needed, and make strategic investments in their business infrastructure. By mastering The Balancing Act, you set yourself up not just to survive Phase Two, but to thrive as you move toward the Leadership and Scaling phase and ultimately build your pool service empire.

The journey from 40 to 90 pools is more than just adding accounts - it's about evolving from a technician who owns a job to a business owner who has built a valuable, scalable enterprise. Master this phase, and you'll be well on your way to joining the ranks of successful pool industry entrepreneurs.

Episode Chapters

• 00:00 Introduction and Western Pool Show Prep
• 08:15 Four Phases Overview and Phase One Recap
• 15:30 Phase Two: The Balancing Act Deep Dive
• 22:45 Financial Knowledge and Cost of Service
• 28:20 First Hire Decisions and Scaling Challenges
• 35:10 Customer-Centric Growth Strategies