Latest / It's Time for Success: The Business Insights Podcast / Lissa Daub on Building a Sellable Business and Escaping the Owner’s Trap

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Lissa Daub on Building a Sellable Business and Escaping the Owner’s Trap · It's Time for Success: The Business Insights Podcast

• Sharon: [00:00:00] Hello everyone. My name is Sharon and I'm with the It's Time for Success Business Insights podcast. For most entrepreneurs, the reality looks like 80 hours a week, missed soccer games, and a business that can't survive a 20-hour vacation without the owner's cell phone ringing. Today's guest is here to change that narrative. Lissa Daub is the founder of Strong Impact Academy, a Certified Value Builder and a Business Freedom Strategic… I knew I was going to stumble on that word... Strategist. Lissa helps ambitious entrepreneurs transition from owning a job to building a sellable asset. Whether you're looking to sell your business in three years or 30, Lissa's mission is to help you build a company that works for you so you can stop putting out fires and start living the life you actually wanted when you started. Lissa, welcome to the show. Lissa: [00:00:49] Thank you so much for having me. Sharon: [00:00:50] This is exciting. We'll get into a little bit more. We've met before. You helped me before. So it's going to, we'll dig into that as we get going. But today just tell our audience a bit about yourself and why you do what you do. Lissa: [00:01:01] Yeah, for sure. So I grew up in family business. My parents had two businesses while I was growing up, and dinner conversations consisted of cash flow, employee issues, all of the fun challenges and celebrations that come from owning your own business. So I actually didn't realize that not everybody knew that, when it kind of becomes this learning as you're growing up. I always knew that I was going to do something in business, and I bought my first business when I was 22. That was an experience and a half. We'll probably talk about that later. And when my parents sold their businesses after 25, probably close to 30 years, they broke even. There was no money for retirement. They just, they looked at each other and said, well, at least we don't owe anybody anything. Sharon: [00:01:50] Right. Lissa: [00:01:50] And I don't think that's right. So that's why I do what I do. I want business owners to get that return on investment for those years of blood, sweat, and tears that they put into their business. And I fell into this Value Acceleration a couple of years ago. And it was like the missing piece from everything. So. Sharon: [00:02:09] Very cool. It's true. Like again, same thing. I think we talked about that before. I was 22 as well. Started a business, a restaurant business. And I remember selling it and I was just lucky to pay off my people I owed money to. So, and as a business owner and everybody listening, you know that you're the one that wakes up in the middle of the night because of stress. You're the one that fights to get the payroll out. They'll always get paid before you do. The stress is astronomical. You're going to put in those 80 hours a week and we're going to talk about that. And it is important to get going, but you shouldn't have to live like that. I've been doing this for 19 years. We shouldn't have to live like that all the way through, for sure. Lissa: [00:02:46] Absolutely. Sharon: [00:02:48] Okay. So let's talk a little bit about the owner’s trap, Lissa. You have to talk about the owner's trap. I've heard you say it. Can you elaborate a little bit more on this for me? Lissa: [00:02:57] Yeah. And, you know, the ownership is really, it's a slow one. It's like the boiling frog, right? Like you don't, you don't recognize it when you start. Sharon: [00:03:06] Mhm. Lissa: [00:03:07] It's really about being that hub in the middle of the wheel, where you're the business owner and every decision has to go through you. So if you took an afternoon off, then, you know, no sales are happening. Things start to dip. If, you know, never mind a whole vacation without having to… for it to be a working vacation. So it's really where the business is so dependent on you that you're just constantly putting out fire after fire after fire. Every employee is coming to you, every vendor, every customer, everybody's coming to you. So you basically built your own prison. Sharon: [00:03:39] Oh my goodness, you word it like that, built your own prison. It's so true. I always say build… you build your own job. Like that's, you know, you buy yourself a job. Like, it feels like a prison sometimes. Lissa: [00:03:52] Right? Sharon: [00:03:52] Oh my goodness. Okay, so many owners think that as long as they are profitable, let's talk about that a little bit. If they're profitable, they are building something valuable. And that's everybody's mindset. We all think that way. Why is it that a profitable business isn't always a sellable one? Let's elaborate on that a little bit for our listeners. Lissa: [00:04:10] Yeah. Well, probably about 80% of the value of a business is not going to show up on your financial statements. Right? And so we always look at profitability. Absolutely. We need to be building a profitable business. Now, a profitable business is not always sellable. A sellable business will always be profitable. And the reason is, is you could have a very profitable business, but if you're the one that's doing all the things, so you're in that owner’s trap, nobody wants to buy your job, right? When buyers come in, they're looking to buy a business, they're looking to buy that investment. So and that depends. That's intentional. Some people want to buy a job. They want to be their own boss and they just want a job. They don't necessarily want to build an empire. They want to have something where they can go to work every day, and that's fine as long as you're doing it intentionally. But if you're looking at selling at some point, you want to make sure that there's potential for a buyer to grow. There is… the business isn't so dependent on you that everything falls apart when you're gone. That 50% of your revenue is coming from your brother in law's business, right? Because what happens when the relationship for that is gone, right? So when we look at a sellable business, we're looking at a risk to the buyer. So we always want to de-risk it so that somebody comes in and they're like, oh, this is a good, solid business where I can step in and things will just keep running smoothly. Sharon: [00:05:40] Okay, so I have to tell you a story. True story. I didn't know if It's Time was a profitable business. I didn't know if I could even sell this business. I look at the bottom number because I don't know all the details. Granted, over the years, I've learned more about it and I... Of course, you're going to learn as you grow. And every year I learn something new. But we, as a business owner, especially those ones just starting up maybe a few years in, you always look at that bottom number and you're excited about that bottom number, or sometimes you're really sad about that bottom number. I remember going to an accountant years ago, and I was so excited because that bottom number showed a profit of $3,000. I'm like, start the car, you know? But was it taking home a regular paycheck? You know, there's a lot of stuff that goes on there, right? So when you start a business, let's talk about that. Say John Doe is going to go start a business. He's going to start his own mechanic shop. What should they think about right now when they're jumping into a business? Lissa: [00:06:30] You know the old saying, it's a Chinese proverb, like the best time to plant a tree was like 20 years ago. But the second best, the second best time is today. So it's the same. Yeah, the same as exit strategy, exit planning. It's like the best time to start is like the day after you start your business. Now, it's more of a mindset thing at that point because when you start a business, unless you're going in, unless he's going in and buying like an existing business that already has staff, if he's just starting it out and it's him, he's wearing all of the hats. And there's nothing wrong with that. That's how a lot of us start our business. Right? Where I still wear all the hats in my business. So. Right? So you're wearing all the hats as things grow, then you start to hire people on. Now you want to make sure you're hiring strategically and it's the next best hire is maybe it's a sales manager, maybe it's another mechanic, maybe it's whatever it is. But it's almost like thinking about starting with the end in mind. It's one of the Seven Habits of Highly Effective People. Begin with the end in mind. That's essentially what you want to do when you start a business is to be able to go, okay, if I want to start this business and I'm going to sell it in 20 years for $5 million. Well, you want to work towards that. What is what is going to do that? And it's that de-risking. I think part of the problem is we start these businesses, we wear all the hats, we hire people, we forget to take the hats off. We forget that, oh, we hired somebody. We can take that hat off and give it to that person once we trust them of course. Sharon: [00:08:04] Once we trust them. Yep. Lissa: [00:08:05] Yep. Yeah, yeah. Sharon: [00:08:08] Okay. Because sometimes like people start like, oh, I can make. Why am I paying so and so? Or if you get a wage and then why are they taking it all? I can start a job and I can make $300 a day. But that's a narrow mindset, I think is what I'm getting at. Just think about where you want to be in five years. In fact, my daughter come to me recently and she was thinking about starting a business and I'm not going to go into too much details about it, but that's my first question I asked her, where do you want to be in five years? Do you want to buy yourself a job? Or where do you see this? Do you… are you going to franchise it? Like, what do you want to do with this job? Right? So anyways, so it was kind of just be, have a mindset of where you want to go and what you want to do, I think, is what I've been picking up from all these podcasts, which I'm very grateful for. Lissa: [00:08:48] Yeah. It's interesting. I was at an event last week where business owners were talking about their failures. And it surprises me when I hear business owners talk about not understanding that the revenue was… that's not all for you, right? The government needs their share, right? Like there's, it's… that's not all for you. Like, just because you brought in $300 today, you probably need to send, you know, 70% of that somewhere else, between supplies and everything else, depending on the business, of course. Sharon: [00:09:23] Yeah. Lissa: [00:09:23] So yeah, I think that there's, it's easy to start a business. You don't need to know anything to go just register that business. So I think it's really important that people think about, know what you're getting into. Because sometimes, and I'm sure you've thought of it over the last 20 years, that sometimes it's a lot easier to work for somebody else where you can just go home and like, like not have the headaches, not wake up at 3:00 in the morning with the stress. Sharon: [00:11:39] Oh my goodness. Yeah. Anyways. Okay, key points to focus on to create a sellable business because we've done this over together. And there are some things that we talked about which were really eye-opening for me. So let's just go over some of those strategies, if you could, for our listeners. Lissa: [00:11:53] Yeah, for sure. I think the biggest thing is recurring revenue. So figure out how you can have a subscription model or a warranty type thing, something where people are just paying you on a regular basis for some kind of service that you're giving them. That is the biggest effect on the value of your business that I've seen as I'm doing this work. And I think because again, we're always looking at de-risking for the buyer. So if you have a subscription model, the buyer looks at it and goes, okay, we already have X amount of guaranteed revenue the first month that we take over this business, right? So it's a bit of a safety net for them. One of the other things I always find with, and I know for me too, right? Like you, you land that anchor client that is like, this is going to pay my revenue and all my bills and I'm good and now I can sleep at night because I'm not worried about where the next meal is coming from. Except that, again, that's very risky to a buyer because they don't know if it's based on a relationship, right? So again, it could be that your biggest client is your brother in law's company. Lissa: [00:13:09] And when you sell the business, then that contract goes away, or that biggest customer goes away potentially. So that's also a risk. So you want to diversify. You don't want any client to take up any more than about 14% of your annual revenue. Right? And that's a big one in service-based businesses, right? Like we talked about that with yours, and yours is very diversified. So you're good that way. But I've, I've worked with other companies where it's like 50, 60% because they have this big whale of a client. And that's a big risk. So you want to be careful with that. One of the other ones again, owner dependance. Huge, huge. You need to be able to, the business needs to be able to run without you. It doesn't mean you need to be an absent owner. It just means that the business can run without you. You don't, whether you're there or not, it runs smoothly. And customer satisfaction. Sharon: [00:14:03] Customer satisfaction as far as repeat business kind of scenario. So what's customer satisfaction based on? Lissa: [00:14:09] Customer satisfaction is basically the… what's your reputation in the market? So it could be Google reviews. We look at Net Promoter Score is like almost like a worldwide accepted, quantifiable type thing, right? So if you're sending out NPS scores, like on a scale of 1 to 10, you know, would you recommend this business to your family and friends? So if it's like eight and above, right? Then that's, you have promoters. So a higher score like that is helpful. And because it's basically just reputation in the market. So if a buyer comes in to buy your company, it already has a good reputation in the market. So unless it's this big, giant company that's swallowing you up as an acquisition, or if it's just somebody coming in and they're going to continue to run, It's Time Promotions, it already has that really good reputation in the market. Sharon: [00:15:04] Okay. And the reputation too, you know, again, it can't be based on you. It has to be your whole team operating with the same core values, the same, you know, outlook on life, how they represent themselves, even in the community. You know, it has to, it's, it's, it's a lot. It's not just people walking in the front door. Right? So. Lissa: [00:15:21] Yeah, exactly. And I think too, one of the things that I've, you know, I've coached some clients through as well is like, yeah, you have some amazing five-star Google reviews, but they all say like, let's say it's your company where it's like, okay, Sharon, you have 50 5-star Google reviews and 45 of them mentioned you specifically. That's a problem. That's an owner dependance problem. So now we want to, we want to collect more. Maybe we want to do an NPS survey to be able, so that it doesn't just have your name on it. Or collect those Google reviews that don't have just your name on it. If it's spread out over your team, that's amazing, right? Because that also shows customer service. But if it's just the owner, then that becomes a risk. Sharon: [00:16:07] So I understand Google reviews. That I know of, but what is an NPS survey? Lissa: [00:16:13] So you'll see it oftentimes when you log into things or you'll get these emails. So let's say your cell phone provider will send you an email and just say, we have a quick question for you. And it's basically the question is, on a scale of 1 to 10, how likely are you to recommend this business to your family and friends? Sharon: [00:16:34] Okay, so you would just create it yourself? Or is this actually like, a website that we use the NPS survey? Lissa: [00:16:41] No, you can create it yourself. Like if you do a Survey Monkey thing, you can do it yourself. It is a service that I can offer my clients for like a third-party one. But yeah, it's, it's just as simple as just doing it yourself through a Survey Monkey or a Microsoft form or whatever it is that you use. Sharon: [00:16:59] I remember, you told me to, that we should do that. And I always feel like we always get so many emails. And I was like, oh, I don't know, I don't want to bother my customers, but as long as you keep it short and simple, maybe it's, it's fine. Lissa: [00:17:10] Well, and sometimes it's that like one question or two questions, it's like on a scale of 1 to 10, why did you rate this the way that you did? Boom. Done, right? Literally don't take up much of their time. Sharon: [00:17:23] Okay. So that would help the resale value of your business. Okay, so let's go. Is there, is there more more points before I jump back and go back one, or no? Lissa: [00:17:33] I think maybe the only other one that I would talk about is how well differentiated is your business from competitors in your industry? Sharon: [00:17:41] Okay. Yo your unique selling. Lissa: [00:17:46] Yeah. So how… yeah, what makes you different? What makes you stand out? So if there were two promotional products companies side by side, and they were both for sale, why would people want to buy yours? What makes yours different? Or how can you charge more than the other one because you have a different service? Sharon: [00:18:07] Okay, okay, okay, so recurring revenue. Let's touch back on that. So I think my plumber is doing it well because I pay them every month and they just come back to check on things and I don't have to worry. So for me, that was a peace of mind. So I think for a recurring value, what can you offer somebody that takes off a load off of their plate, less stress, that kind of thing. For It’s Time Promotions over here. You told me to do this and I'm like really struggling. Like I don't have anything. The only thing I can think of, and you suggested it for me. So thank you for that. That's another value to your, you know, your services that you offer, is if we do vinyl vehicle decals, like a fleet in particular, I'm trying to wrap my brain around this. So I'm kind of hoping our listeners will say, yeah, I'd sign up for that or no, that's dumb. Like whatever, help me out on this. So like, so say if we do a fleet because we do a lot of oil companies or fleet decals. So if we offered a service, a monthly service to go back and check, you know, we'd have all document of all the unit numbers, check their decals. Sharon: [00:19:06] If they're peeling, lifting, replace them, whatever. So we just come back and keep going back and forth and doing that. Would that be worth a service? That's the only thing I can kind of think of that we can offer over here at It's Time Promotions. That's top of my mind right now. So I think if we do a monthly fee, go back and check all the unit numbers so they don't even have to say, Sharon, I need another unit number or need another decal. It's eight feet wide. Well, they don't even have to tell me that stuff. I'll just go and book it and have it done, right? That's the one thing I can think of. But other than that, so what are other cases that you've come across that are a little bit unique to some of the other companies that you've been working with? That's, you know, ideas. Get their brains thinking here. Lissa: [00:19:48] It's always because we always go and we think about those subscriptions and we think about those memberships. So it's always hard to think outside of the box a little bit on these. So for yours in particular, if you think about the owner of that company or the operations manager, fleet manager, whatever that is, instead of them having to go and check those decals all the time. And the next thing you know, they're driving down the road and it has a really shitty decal on it. Well, that's a direct reflection of the company, right? So I think that's a really great service that you can offer and add. And then again, right, takes things off their mind. Lots of times too, when you're looking at what are, what are the things that customers keep coming back to you for? And is there a way that you can make that a little bit more automatic? So we think about automatic customers. For Hvac companies, it's like a filter service, right? We're going to, we're going to send you, you know, filters every quarter or every six months we're going to send you filters. And, and like your right, like your plumbing company, like that monthly fee where they come and they check things, they do a check. So again, whatever you can do, depending on what the company is, is whatever you can do to be proactive. Lissa: [00:21:01] So proactive maintenance instead of like, I'm going to wait until things are broken and then call the plumber and now it's after-hours and now I'm paying like three times as much as I needed to. But I have this peace of mind. You said it right there. Peace of mind. What is it that you offer your clients that can give them peace of mind and you're taking a bit of a load off their plate while also creating this recurring revenue thing for you. Ideally, if you could create passive recurring revenue, I mean, that's the dream. But that's hard, right? You need to be, obviously you need to be offering them something. If you can warranty any of the work that you do. Again, depending on, depending on what it is. Yeah, for promotions it's, I really like the idea of a promotion company being that partner, being that marketing partner almost where it's like, I know I'm going to go do X number of trade shows this year. And then I forget in the trade shows coming up and it's like, oh dang, I forgot to order my table giveaway type things. Right? Yeah. So where, when people are coming to you for emergency orders, start to think about how you can be more proactive for your clients with that on a regular… Sharon: [00:22:18] On a prescription level. Yeah. Yeah. And it's all about customer service, that's all. That's all I want to do. Yes. I want to have a sellable business someday. Am I going to sell my business right now? Absolutely not. But it's something to work towards because I met you and now I know about this kind of stuff. But also it's meant to offer service because even here at It's Time, I'm trying to incorporate like world wide web. So we're offering like online stores for our customers so they can just go in, like shop like Amazon, right? You know, like that's kind of an idea because you're meant to offer service. Everybody's business, as business owners, they're very busy. Sometimes those tasks is like bookkeeping. What can I get rid of? So think of those things that you can take off their plates that you are qualified for to help them. That's kind of where I was going with that one. Lissa: [00:23:00] That's also so, human resources background just popped into my brain here. And of course, employee retention and all of that stuff. So one of the things when I was back in the day working in HR, we had a bit of a points program that we had for our staff. And so they gain points by living the company values or, you know, whatever it is, they did nice things for other people, then people could give them like points. It was like a peer recognition. Well, when they had enough of these points, they could cash them in. And typically what they cashed them in for was like company swag. Sharon: [00:23:35] Oh. Lissa: [00:23:36] Right. So you... Yeah. So you, with your websites for your clients, you think about that like, because if your employees are walking around wearing your company's swag, they're proud of where they work, right? And you've got really great stuff. And then that's just another, another thing that's very easy for your clients where they don't necessarily have to manage that all the time. Sharon: [00:24:00] Right? Yes. Very clever. I love that point system. I'm trying to think now how I incorporate it into my staff. I mean, my staff walks around with at It’s Time stuff all the time. And it's very important. Everybody should be having their swag because they feel like part of a team. They walk proud. It's just a good thing to do. It's just a very important. Okay, let's jump to the next one. Largest customer. No more than 14% is the magic number. And, of course, I got a check mark on that one. I was good in that one. But what are some situations or how they can deflect this or help somebody that say they're in this spot? What can they do to rectify that? Lissa: [00:24:36] Look for more clients. Diversify your client base, right? And look at the, look at the things that you're offering. And I mean, like if you have one big anchor client, go find two more. Go find two more big clients, right? Now you're again, you're reducing that risk. I don't suggest that you fire that client because they're taking up too much of your revenue. It's like, no, absolutely. I kind of need that money, right? Sharon: [00:25:01] You need to mimic that. You need to duplicate that basically. Yeah. Triple it. Okay. Lissa: [00:25:05] Yeah, yeah, I just fired my biggest client two weeks ago. But I also went in and I had like, I had a backup plan. I had, I already had things in place that was going to not quite replace that revenue, but almost, but amongst a few different clients. Right? So I diversified my client base that way. So I had already started on working on diversifying the client base. The biggest client, it was just because it was work that I didn't want to do anymore. It was no longer aligned with where I was taking my business. Right? So that's also the thing is like, work with the people you want to work with, find those clients that you want to work with. And then, and if you're not going to sell for 15, 20 years, don't worry about it. Keep it in the back of your mind to start. I mean, worry about it in the fact that what happens if you have a relationship with the person that you're dealing with at that company, what happens if they leave? Right? And worry about it if they go out of business, what is that going to do to your business? Sharon: [00:26:09] Mhm. Mhm. Lissa: [00:26:09] But don't worry about it as far as like, it's making my business unsellable. It's like, this is something I know I need to work on. So I'm going to be looking at my service offerings or different… Maybe there's different clients that are in that same industry that I know I can serve them really well, and maybe they're smaller. So there's just different ways to do that. As we grow our revenue, try and grow your revenue in a diversified client base. Sharon: [00:26:34] Gotcha. That actually happened. It's Time Promotions back in the day, we started up and back in the day, we had the oil company and it was Winterhawk, his name was and they sold. And it was like, Holy F. And in our world, a lot because it sold to a bigger, bigger company, not a locally-owned company. So a lot of those places, like they get all their stuff from corporate. So it's really hard in our world to get into corporate. Yeah. So it was like we lost that whole account. So it was like holy doodles. I mean, they have owner operators that still shop with us, which was great or still worked with us. But it was yeah, it took a big hit for sure. And it was like scary. So it could happen overnight. Lissa: [00:27:13] Absolutely, it can. Right? Absolutely, it can. And I think that's also the importance of I get the question all the time. It's like, why do I need a sellable business now? I'm not selling for like 20-some years, but it's like, but what if something like there's a, there's an example. What if there's a divorce? What if, what if you get hit by a bus? Yeah. Sharon: [00:27:33] My boss used to always say that to me, if I didn't make proper notes. What happens if you get hit by a bus? It's like, okay, whatever. Lissa: [00:27:39] I had, I have a, I have a friend who does similar work. She's a financial advisor, but she's like, what if the bus doesn't kill you? Right? So now you have like either death or disability. It's a little morbid, but it almost becomes like having that sellable business almost becomes like that insurance policy where if something happens, you know, there's, you have this value in this investment that, you know, if you had to sell at least it's not cents on the dollar. Sharon: [00:28:08] And it even goes, even though that is a morbid topic that we just talked about, but it also goes to our next point, which is owner dependent. Lissa: [00:28:13] Yeah. Sharon: [00:28:14] Right? So like you don't want a business where it'll literally, it can't operate without you. In fact, it even goes even further down for me. It's not only owner dependent, but because we have different departments. Our niche, which is your unique selling here for us, is we do almost everything in-house is our is our a little bit above here. So, for that one, it's not even owner dependent. But what happens if my silkscreener is sick? What happens if my silkscreener… I got to have a backup silkscreener. What happens if my embroidery lead is away or something happens, you know, gets hit by that bus and she's in the hospital. I need somebody else to run that embroidery machine. So like, we can't have any department relying on one person and that goes back down to the owner dependent. Lissa: [00:28:55] It goes to owner dependance and it also goes to, so in the value builder system I use, they have funny names for the value drivers, as I'm sure you remember. So Switzerland Structure was really about that client dependance, right? Like how you don't want any client more than 14%, but it also talks about how hard would it be to replace your number one employee? And what happens if they leave? Like if you have an employee that you've given the keys to the castle, it's like, great. The business isn't dependent on me. Nope. Now it's dependent on this employee, which again, they don't really have as much skin in the game. If they get offered a better job tomorrow, they might go, right? And your vendors, like, do you have like one vendor that you can get things from? Right? So, and for a lot of companies, the vendor’s almost the easiest one. But if you think of like bookkeepers or accounting firms that specifically are specialists in QuickBooks, well, what happens if QuickBooks blows up and they don't exist tomorrow? Now, what are you doing? Sharon: [00:30:03] Shhh. Don't say that. I use QuickBooks, I love QuickBooks. I get what you mean though. Lissa: [00:30:07] I think it's pretty safe, right? Yeah. But like that's yeah, that's that's one, you know, that's, yeah, that's one thing. So if you have, if you have very like specialized products, like if you were only going to buy your hoodies from like one vendor and that vendor goes out of business. And now it's like, oh, but we, that was the best price because we had this great relationship, right? So again, it's about that diversifying around that. And again too, yeah, owner dependance and then those key staff dependencies as well. Sharon: [00:30:41] Okay, Lissa, let's talk about the customer satisfaction part of that. So again, we talked a little bit about, how did I do on my rating? Do you remember? Customer satisfaction? I think I did good. Lissa: [00:30:52] Yeah, I think you did. Yeah. I think you did pretty good with that one. Sharon: [00:30:56] What do you consider customer satisfaction and how is that graded? Lissa: [00:30:59] So customer satisfaction, so one of the questions in the assessment is about how many people follow you on social media. Sharon: [00:31:07] So when you talk about LinkedIn, like all the platforms. Lissa: [00:31:10] Yeah, all the platforms, your email list, that kind of thing. Now that doesn't make sense for like every company, like not every company is active on social media and it doesn't, right, it doesn't affect their business. One of the other ones is percentage of customers that are satisfied with, with their work with you. And I don't make people prove it, but if it's like over 75%, which is, I think that's where I think that's where you were at was like over 75%. Sharon: [00:31:41] Oh yes it was. Yes, yes. And I don't know if that's just me wishing, dreaming. I think so though, because like, what I value at customer satisfaction is our repeat customers, I think, and our referrals, right? So if you can, I think, try to get a way of tracking that. How are these people coming to you? That might be a good way of tracking that. Lissa: [00:32:00] Yeah. Absolutely. Sharon: [00:32:02] Right? Lissa: [00:32:02] Because I think if yeah, if, if we, if we go into it, if you went to work with Colleen, who I know was, was on your show, because I think she actually introduced us as a business broker and you said, you know, my customer satisfaction score is this. And it's like, yeah, prove it. So you want to be able to have the data to back it up. And that's why we talk about the Google reviews and the NPS surveys, because it's quantifiable, where people are actually saying, yes, I'm satisfied. No, I'm not. Because how many people, like if you think of all of the customers you have, not everyone gives a Google review if they're not happy. They also don't necessarily put in a complaint, right? Some of them will, but not all of them will. They just won't come back. So I think you're on the right track with repeat business and referrals. So if there's a way that you can track that. And now I'm wondering, is there, is there some type of recurring revenue type thing that you could put in not really recurring revenue, but if you put in like a referral program to be able to track how many people are giving referrals. Sharon: [00:33:07] Yeah. Lissa: [00:33:07] Right? Sharon: [00:33:09] We have a, we designed our own software here, which I'm very, very proud of. So anybody that wants to, in our business wants a software. I'm going to sell it one day. I'm just not there yet. But anyways, it's genius and it's amazing. But anyways, one of our, so we get a new customer that comes in, whether it be phoning, whether it be through our website, whether it be front end door. How did you hear about it? It's mandatory. My staff is trained, they have to know that question. So is it a referral? Is it from the front signage? So this is how did you hear us, on the radio? Like how did you hear about us? And a lot of times it's just word of mouth, which again goes back to the reputation, right? Lissa: [00:33:42] Absolutely. Sharon: [00:33:43] It's not necessarily a referral because they just heard about us, right? It's literally that's reputation. So, I would strongly suggest if you have a business, try to find out a way that you can track that. I think that will help your value when you get to that point as well. Lissa: [00:34:00] Oh, absolutely. And the thing is, is if you know where your customers are coming from and you're spending marketing dollars, now you know where to spend your marketing dollars. Sharon: [00:34:10] Yeah. That's what we focus on is that kind of stuff for sure. It helps us. In fact, in our software too, we have, we, it calculates it all, but we can also do percentage of sales and all that kind of stuff. So anyways, it's really clever. Okay, Google review. Let's talk about Google reviews. And you know what? It's not second nature. And a lot of people, again, I think we're rednecks out here. It's not… like my husband would never give a Google review. Never. Mmm mmm. Keyboard Karens give Google reviews. Right? Like that's so unfortunate. So you’ve got to reach out and ask for people. Yeah. So anyways, let's talk about Google reviews a little bit and how else they can get up there. Lissa: [00:34:50] Will you give me a Google review? Because I'm really terrible at asking. Sharon: [00:34:55] See. It’s terrible. And I don't know if it's an age thing, but no, because my staff at the front is young and it's actually harder for them than me to ask for a Google review. Lissa: [00:35:02] Yeah. It's actually funny. So the last Google review I gave was somebody that I do, that I've done work with and she sent me an email yesterday. And at the bottom it says, would you give us a Google review? And I clicked on it and I gave her a review and I'm like, well, that was pretty easy, right? Yeah, I think that especially I'm, so I'm going through a rebrand with my business and talking with my graphic designer/marketing person. Yesterday we were talking, she was talking about how people buy based on reviews. So if you don't have enough testimonials or reviews, like that's how people are doing things. And if I think about the way I shop, I'm like, that looks really cool. What have the real people had to say about it? Like, I think we're, we're, we’re now so accustomed to reading people's reviews, to know whether we should or shouldn't buy this thing, whether you're on Amazon, whether it's a Google review, whatever it happens to be. So I do think it's super important to be asking for those. Now, again, it goes back to that, well, I don't want to bug my customers because they get enough emails. I don't want to keep sending them emails over and over again. So what are some ways that you can do that that might prompt that Google review? Maybe it's on an invoice, but it depends on the companies. If… unless you're working with the… not always does the invoice go to the person that you've dealt with, right? So what are some ways to do that? I think, you're in the promotional products business, right? You do printing, I'm assuming too. So right. Like even having every order have like a little postcard or something that has a QR code on it with, with the thing like, please give us a Google review. Sharon: [00:36:46] So you're thinking, put something in the box of whatever they're giving. Give something in there, whether it be a postcard, whether it be a whatever to go in there. Okay. That's brilliant. One thing, too. Lissa: [00:36:57] Keep it like as simple as possible. Sharon: [00:36:59] Simple. And a direct link. That's another thing, a direct link. Don't make them go searching for it. I tell my team that all the time. They'll say, oh, somebody praised something. I said, did you ask for a Google review? Send them the link. Right? So we actually created in our Gmail template because you can do Gmail templates so they can pull that in. Of course, you're going to reword it versus, you know, based on who you're talking to, but at least it gives it the direct link. It's simple. They can open up the template in Google and hit send and modify it and send. Another place you'll see if you go to like a massage place or a nail place, they have those really cool things on their desk where you just take a picture of it, QR code, and it goes straight to the Google review. So try to... We just recently started incorporating on our invoices too, and I don't know if it's actually a direct link or not. I should probably go confirm. I just added it in there actually, because we're very mindful of the Google reviews too. We're focused on that right now. So what other ways would be clever? Lissa: [00:37:51] I think whatever you can do to… Do you use social media at all? Sharon: [00:37:59] LinkedIn and Facebook. We do have Instagram, but I have a, I have a marketing team that stays a little bit on top of that for me because it's painful. Lissa: [00:38:08] It is painful. But I'm wondering if you started sharing some of like the Google reviews or the testimonials that you get in a post and then say, have you worked with us? Do you want to give us a review and then have the link there? I think however you can get that link in front of people and it always feels like we're bugging people. And I think it's probably how we were raised. Like, stop, don't look, don't look for compliments. Where it's like, okay, my business kind of depends on it. So I better start looking for compliments, right? Sharon: [00:38:38] And it's important. People that don't think it's important, it's important. I'm going to tell you a quick little story. So back in the day, I don't know how many years ago, but Google review wasn't as important as it is right now, or as just starting or whatever the case is. It wasn't second nature for me to go check those Google reviews back then. Anyways, I had to go to Calgary to a trade show or seminar or some darn thing. So I was so excited. So I booked a hotel. I thought, I'm going to go early the day before. Got my laptop, I'm going to work from there. I'm going to order food in. It's going to be great. I was so excited to have this hotel room by myself. Anyways, I got there and talk about slumlord. Like it was like the lock, it was like the crappiest place ever. The seat, the back of the chair. I couldn't even hardly sit in it or lean back because I would have fallen over. The internet was so terrible I couldn't even connect my laptop to it. I couldn't work. So I ended up going out for supper and then just sleeping really fast and then going to my thing. It was terrible. But if I would have looked at a Google review, I would have seen. Yes, I would have picked a different hotel. I was very disappointed in it. So just be mindful. I think everybody does it. Even if we don't know we're doing it, we're doing it. So be that person to get those Google reviews for your business, get those escalated, work on that, focus on that, however that might be because it will help your business in the long run, for sure. Lissa: [00:39:50] The other thing that's also super helpful when you get a Google review, respond to it. I think, yeah, I think that's super important. And I think people don't often remember that or don't think how they don't think it's that important, but it really is because then it starts to show who you are as a business owner too, right? So yeah, whether it's you or whether it's a team member, but always responding to them. I always liked the idea too, of like the postcard thing. I think that's brilliant for if you're sending out any type of physical good, where it's like, if you're not happy with your order, let us know. If you are happy with it, let the world know. Sharon: [00:40:31] Yeah, yeah, I like that. That's actually a lot. I should yeah, I should probably incorporate that into my business. That's very clever. Okay, so that's just weird that Google review is actually will enhance your cell ability for your business. That's kind of mind-blowing actually. Lissa: [00:40:45] Right? Because if you think about it, I mean, if you're going to go shop from a business, you're going to check the Google reviews, right? So think about if you're going to, if you're thinking about buying that business, one of the first things you're probably going to do is go and look at the Google reviews, like what's the reputation? Because if I have to fix somebody's reputation, then that's going to decrease the price for me, regardless of how great everything else is. Sharon: [00:41:07] We actually had a bad Google review. So we started out in Provost, Alberta and I bought here in Lloydminster in 2015, I think. So when we bought a current business, so we took it over and at that time we got a bad review and it was like just chaos, like it was hand-over and it was, it was. That's a whole different podcast. I can go into details about that. What not to do. Anyways, we got a bad Google review and that thing still haunts us. We will not get a five because we got that one Google review ten years ago. We're at 4.9. Like it's just so crazy, like that one. Anyways, it's very, very frustrating. Lissa: [00:41:43] Yeah. It's annoying. It's annoying. And I mean, like. And I think that's the thing that people don't realize too, when they're giving a Google review. If you're unhappy with something that a business is doing, go to the business first. Like let them, give them the opportunity to fix it. If they, if they don't, then you can look at doing, you know, like a low Google review. But yeah, it is really, it can be very detrimental to your ratings if it's just somebody that was having a bad day and their coffee was too hot. Sharon: [00:42:15] That's right. Yeah, 100%. And most businesses, if you're doing them, they're going to go to bat. I know we will go to bat and fix whatever. If there's a situation, we will definitely help them. Okay, next one is reputation. Let's talk about that a little bit. Kind of with the Google review. They kind of combined, don't they? Right? Yeah. Lissa: [00:42:30] Yeah, they kind of combine because it's like what is yeah. What is that reputation in the community? The other thing that is helpful too is, especially in smaller communities like you operate in smaller communities, you're not in like the city of Edmonton. And even if you were, I think, how involved are you in the community? Are you making donations to the community? Are you, you know, are you there? Are you supporting events that are happening in the community? You don't have to go broke doing this, but pick your things and show that you’re, you know, community supportive. That makes a difference. If it's another small town person coming in or they're looking to come in and buy this business and run it on their own. Not as important if you're looking for that strategic buyer, that bigger company that's going to come in and basically swallow you up and It's About Time Promotions is no longer a thing. But if it's somebody coming in and saying, I want to buy this business because I'm really, I want to help other businesses. I love this whole marketing aspect. I love promotional products. I mean, there's a million ways to make $1 million. And you chose to do promotional products. Somebody else out there is the same way. And maybe they're buying a business for their family to operate at. Whatever that looks like, part of the reputation is going to be really important to them because they don't want to have to fix your bad reputation, right? Yeah. They want to come in and continue. Yeah, yeah. Sharon: [00:43:58] ust how does that go? Integrity doing the right thing, even when nobody's watching, right? So be that person, be that person. And that's one thing too, I think as you get the reputation, people come to your door all the time and I'm going to tell you right now, you cannot, you cannot give to everybody as much. And I'm that person, I want to. I can't, I can't, I can't, I can't do it. I can't physically, financially do it. So pick those people who resonate with you, pick those companies that resonate you, that speak to you, that, you know what, maybe your group of people, like that kind of thing. Like you got to focus on that for sure. Lissa: [00:44:34] It's all about alignment, right? Like you want to have that business doing the work that aligns with you. Working with customers that align with you and giving to the things that align with you. Because there's this misconception from people out there that don't own businesses, that business owners are all very, very rich. They have a lot of money to give everybody. And it's like, no, no. I had more money to give to charity when I had a regular paycheck coming in. Right? So, yeah, and I think it's really important again, it's that discipline to like have your budget for what that is. Work with your team. It’s also a really great team building exercise to have the team decide like what, what do we want to focus on this year? What are the events that we want to sponsor? What are the, you know, charities that we want to donate to and let everybody have a say on that? Sharon: [00:47:25] Okay. So how does somebody didn't realize that this is important. One of our listeners did not realize this is important. How do they go about finding out if they have a sellable company? Do they reach out to you? What does that look like? What happens if they're in China and they want to do this? Like, let's talk about how they can get Ahold of you first and who do you work with? Is it just Alberta-based or is it Canada-wide? Like, how does that work in your industry? Lissa: [00:47:50] It's, um, so I mostly focus on Canadian businesses. That's not to say I have had clients in the states of North America. These, these drivers are really, it doesn't matter. It doesn't matter where you are in the world. These are some of the things that are going to drive the value of your business. And also like if there is somebody in China, there's probably advisors that do similar to what I do there that they could work with closely. And I'm happy to tap into my network and find somebody that they can work with. You can do just a sellability score. So basically it's just that one pager that you went through. I won't go through the questions with them like you and I, when we had our engagement, it was to go right through and get that full estimate of value and everything. And knowing what your business is worth today, what it could be worth if you improve your score. So there is a link on my website where you can just do the sellability score, and it just gives you the score in those eight drivers. Sharon: [00:48:50] So it gives you the score. It's the percentage. It doesn't actually tell you what it's worth. Lissa: [00:48:54] No. There’s no value. Sharon: [00:48:54] Okay. Because I remember getting that. It's like, well, that's disappointing. It's just a percentage. Like, I don't know what that means. Right? So because I wanted to know the value, I didn't even know if I had a sellable business. Okay. So they can still do that. They can find out if they're below 50 or over 50 or whatever the case is. And then if they feel that they need help or guidance or they're like, you know what? This is really interesting. I'd like to know how much this is worth, then they reach out to you. Lissa: [00:49:18] Absolutely. Yep. Yeah. And then we go through and if they and then we clarify all those questions. Like you and I went through that questionnaire together because there were certain things where it's like, oh, I didn't know that's what that meant. Right? So we go through, we go through the questions together. We clarify all those. We have a look at your last three years of financials. And then we get you that estimate of value. And then, it also shows this is what it's worth today. Improve your score, this is what it could be worth. And then you and I actually went through and said, here's the biggest bang for your buck. Here are the drivers you want to focus on when you're ready to focus on your business. Sharon: [00:49:53] Yes. And it was very helpful. Lissa: [00:49:55] Yeah. And I think the key thing is a sellable business is a healthy business, right? So, again, it doesn't matter if you don't want to sell today or next year or 10 or 15 years from now. It's almost like that health benchmark. And I always equate it to, right, every… we just came out of February. So everybody was like keen on like, let's get my RRSP money and to save some money on taxes. Well, every year or twice a year, you get your statement for your RRSPs. I know I look at it, I'm like, what's the number? I look at the number and I'm like, okay, good to know. That's the number. I'm not going to do anything with it. I'm going to file it away. But a business owner, their biggest investment is their business and they don't know what it's worth. So, you know, even if it's just to go okay, oh, it's less than I thought. I’ve got some work to do. Or it's more than I thought, I'm feeling better. Right? So I think it's really important for business owners to know this. And I… accountants will give you like a, like a benchmark, like a it's three and a half times this number. Well, maybe, maybe not. Right? It depends on your industry. So I think that's why you don't need a certified valuation that costs thousands and thousands of dollars. You just need an estimate of value. Would I give you don't take that to court, right? It's just it's an estimate. Sharon: [00:51:14] Right. But yeah, they talk about EBITDA. They talk about all these other strategic things, which you talked about as well, but it's broken down into language that I can understand. And also just for our listeners, Lissa did not break the bank. I'm not going to give you an amount that I paid just because it changes over the timeframe and all that kind of stuff, but it will not, you'll be surprised how affordable this is. And it could be just a peace of mind, as Lissa just mentioned. It could be something to work towards. So reach out. It's definitely worth the dollars that you are going to spend. Okay. So we're going to wrap it up because I think we've been chatting a long time because I can chat with you forever. So you did talk… one question that I… I like to throw some random questions out. What's your book of choice? If you, if you have any recommendations for our listeners right now to listen or to buy a book, what would it be? Lissa: [00:52:06] Buy Back Your Time. Sharon: [00:52:09] Mhm. Lissa: [00:52:09] Until I get my book finished, that's the one I'm going to recommend. Yeah. Sharon: [00:52:14] Buy Back Your Time. Lissa: [00:52:15] Yeah.Buy Back Your Time by Dan Martel because it really does go into that owner dependance thing, which is typically the biggest issue I see with business owners. And that comes from a lot of mindset where if I want it done right, I needed to, I need to do it myself. Right? Thanks, Dad. Sharon: [00:52:34] Mhm. Lissa: [00:52:35] So it really, it really breaks down that whole mindset issue. It's like figuring out, well, what's your hourly rate worth. If you're worth, if your hourly rate is $200 an hour, why are you doing $20 an hour work? Sharon: [00:52:49] Right? And it's really hard because I tend to lead by example. So I do not expect, in my mindset, and I don't know if it's a Gen X thing or what that is, but I cannot expect somebody else to do something that I'm not willing to do. It's so crazy. Lissa: [00:53:03] For sure. Again, just because you can doesn't mean you should. Sharon: [00:53:06] Right? So yeah, it's really hard. It's hard. Write that down. That book. Yes, I'm going to read that book. Lissa: [00:53:11] Yeah, it is a really good book. It really does open up that mindset as far as like the work that you should be doing. And again, leaning into that freedom part of it too. Sharon: [00:53:23] All right, so we're going to wrap up here. So I have a little script I'm going to read right now. So again, anybody out there if you need, are thinking about your business, is it profitable? Is it sellable? You know if it's profitable because we look at the bottom line, is it sellable? Is it something you want to work towards? Are you just comfortable having a business? Then that's so be it. But if you want to reach out to Lissa, please reach out to Lissa. It'll be on the show notes down below of how you can reach out to her. So I highly recommend it. If you're listening and you're tired of being the only person who can solve problems in your company, I highly recommend checking out Lissa's work. You can find her. Oh, I got it right there. You can find her at StrongImpactAcademy.com. There we go. StrongImpactAcademy.com where you can take her sellability assessment, which she just talked about is on her website. So you can see if you're, you know, what percent you're at and just see where exactly where you stand. And then after you take that, and if you want to reach out and go over some things with Lissa, she's more than willing to work with you. Sharon: [00:54:19] So thank you, Lissa, so much for joining us. I really appreciate it. And I really appreciate the relationship that we've built and these ideas that you've thrown at me to increase the value of my company here at It’s Time Promotion. So thank you for that. So everybody out there, thanks for listening to It's Time for Success: the Business Insights podcast. Please subscribe, reach out to our guest and share this episode with another entrepreneur who is ready to grow. If you hit a learning curve or have questions, please reach out. Lissa's an amazing human being. You will love to work with her. And if you have a topic that you would love to share with our listeners, email me at Sharon@itpromo.ca. We would love to have you on our podcast. Or if you have a topic that you would like me to touch on, please send us a request at the same email, which is Sharon@itpromo.ca. Remember, stay curious, stay adaptable, and surround yourself with people who lift you higher. Thanks everybody for joining us today.