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Planning in Business · Business Roundtable

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Well, hi everybody, welcome back. This is a David Carr of Stewart
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Your Business with some great gentlemen with me. Tonight. We're going to be
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covering a topic that is near and dear to my heart. In all business
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owners at some point is planning and preparing for their day, for their week,
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for the month, for their year. So again, David Carr here
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is Stewart your Business. My focus is overall organization, health and helping business
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owners and their teams come together to accomplish great things. I will throw it
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over to Doc c here tonight to introduce himself. Go ahead, Doxy,
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Hi, Curtis Cochran here, and we are in mergers and acquisitions. We
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developed our for Math philosophy system which is really entering, evaluating, enhancing the
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next business ownership, which is four cycles of business ownership, and you the
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listeners, might be in one of those. But today we're going to have
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a great talk on what you should do, probably to start the new year
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off. Absolutely, we lost Bill. He's had to have a little bit
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of a connection problems, but we'll get Bill back here. Bill's not new
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to the podcast. He's actually been on pretty regularly with us the last few
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weeks we didn't have you Doc seedback. We're glad to have you back.
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With a holidays. Everyone's schedule is a little different, but it's fun.
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We get there are different voices here on the podcast from week to week.
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Uh, and so that's always fun to have that dynamic. And so thanks
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for thanks for being back. Absolutely. Yeah, you have a lot of
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experience in this area, Curtis. With business owners, those that are looking
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to sell their business, looking to buy a business, it's it's really incumbent
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upon them that they do their planning, do their research, prepare. Maybe
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why don't we talk about what happens when you don't do that? Yeah,
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you know, you think about this. This is something I talk about often,
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and you know, let's say that and I you know, I'll use
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a sports analogy. I mean, each and every week, you know,
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the NFL football coaches they are looking at film and spending hours and hours and
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hours and hours and hours just on developing a game plan for the next week.
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And then they implement this new playbook that they do this every week.
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It's not every year, they do it every week. And if they don't
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do that, they get their rear ends kicked. And what's really interesting to
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me is and I speak really to those business owners that are around the half
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a million and maybe two million in revenue, because those businesses are the ones
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that need an evaluation, a game plan starting January first. And you know
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it costs money, yes, but by golly, you want to have an
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idea of what you want to do with your business. So I always encourage
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business owners December thirty first, you know, get your P and L together,
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which of course you're getting ready for taxes. Well, it depends upon
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where you're at during that year, but you do an evaluation and that way
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you have a game plan as to how you want to grow your business instead
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of wishful thinking, because that's exactly what they do. And I understand it.
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You know, a small business owner, they wear ten to fifteen hats
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a day, but you know, break off and give it to somebody that
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actually can that does this for a living and can help you actually grow your
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business to make it profitable, sellable, but more importantly enjoyable. Really.
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But yeah, it's part of the E two evaluation stage that we bring our
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business clients in for sure. Yeah, that's so important, Curtis. We
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did do do that analysis of kind of where you're at, the facts of
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your life, where you're at now, Like you said, look at the
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P and L. So number one, you have to have a foundation of
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what the what the actual truth is, what the actual numbers are to then
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plan something for the future. If you don't even understand that, right,
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it's kind of building on a uh you know sand if you will, as
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opposed to you have to know the facts of where you're at so that you
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can actually then project forward where you want to go. Welcome Bill, We're
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glad you're back. I know you've been a little Internet connection, but we
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want to let you know, let you introduce yourself real quickly. Are you
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froze? Hopefully you're there, poor Bill, he's been having connections. Yeah,
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he's froze. Yeah, he's froze right there. We'll bring we'll bring
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him back once he's back on connection. There. You know, it's interesting
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what you said there is extremely important. I can't even emphasize this enough.
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And that is when you're talking about facts, because that's really what you have
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to zero in on is the facts? What what are what are the facts?
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What? What is it that we did really poorly last year? And
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what can we do to eliminate that or at least stop the bleeding, so
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to speak. Because every and going back to the analogy of the football is
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every team has their strengths and weaknesses and by the way, their opponent knows
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them. If they don't know them, then they're just as bad off as
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the other team. But a business, you should know your strengths and weaknesses.
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You should know them and more importantly, admit that we have this weakness
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and we try to, like like in football, they try to hide it,
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but it's going to be that red herrying out there and it's going to
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jump out and bite you. You know. So valuation every year, yeah,
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go ahead, yeah yeah, well, well, you know, among
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those things will back it up another step. I think you brought up this
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idea of strengths and weaknesses opportunities throughout the typical what we call swat analysis,
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and I think oftentimes I've already done that with some clients this year as we
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go into the end of the year, as you look at those things,
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absolutely knowing your strengths and knowing your weakness is oftentimes I find weaknesses can be
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opportunities that you can leverage. They you know you have a weakness column,
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but then you're like, oh, I can actually make that an opportunity going
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into the next year. But again not knowing that and and what I found,
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Curtison, let me know what you thought of this is oftentimes business owners
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they actually might they do a good job, they've at least done their weaknesses,
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and then they look at opportunities and there's a lot, especially that size
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of business, there's a if you're doing something right, there's actually a lot
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of opportunities. The challenge is picking the right ones and investing accordingly, because
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you can't do all things. Unfortunately, just is not feasible. So what
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would you say to the business owner like you said in this and it is
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okay, they've identified their their weaknesses and now they've identified opportunities. What would
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you give them guidance as to then how to how to sift through that makes
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sense of all those things, because again there's only so much time, so
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much money that you can invest. Well, there's what small business owners need
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to understand is and I'm sure they do. There's a book out there called
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No Man's Land. I can't remember the author. It just popped into my
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head. I can actually find it and give it to you guys, maybe
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the next week, if not today. But this is an interesting book because
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what you can only you could only take your business to your own level.
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That's it. And the only way that you can actually grow it further is
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that you need to hire people that kind of your weaknesses, that supports your
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weakness. But then you say a culture. And one of the things that
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I noticed all the time is businesses, small businesses are afraid to grow,
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and so that is there. It's either you're growing or you're doing And that's
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exactly that's a no man's land I was telling you about, because what happens
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is if you do not grow, you reached your peak. It's called an
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inflection point in mathematics, and you've reached it. And it's at this point
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of inflection you either will continue to skyrocket or you're going to turn and it's
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just going to go down. And you know how that is because gravity is
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is a great force that will bring you down rapidly. It's tough growing in
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itself, but that right there is the key is that you're going to have
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to spend money and you're going to have to take maybe a three to five
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year period to see this thing grow and you're going to you're just gonna be
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amazed as to what happens when when we get the right people in there.
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Yeah, I mean so many You talked about so many different things in there,
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Curtis. I'm gonna bring us. Unfortunately we lost Bill. He's not
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gonna be able to join us. Someone to just zoom us in a little
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bit. There we go. You can get us in full frame. But
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yeah, looking at that business cycle, you're either you're either building up or
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you're you're you're decreasing. And I think if you're not playing and looking at
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those obstacles and those challenges, and there's you know, there's so many there's
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so many examples here, Curtis, of businesses that didn't really look at the
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change changing landscape. Now, there was definitely weaknesses, there's definitely threats.
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You know, we look at big companies you know that they're no longer here,
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like Coda. You know, Kodak was psnoymous synonymous with cameras and photography,
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and they couldn't pivot. They didn't look at the challenges that were coming
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before them, or they just kind of like you said, even they had
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all the success decades of excess and they were actually the leader and at one
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point in the digital video video digital uh photography market, but they didn't think
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it was going to be really something to come like it was or even you
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know, you look at other business models that have changed because of online shopping,
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for example. I mean this year, I looked, you know,
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I grew up through the Black Friday sales and the craziness of what people used
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to do, and you go and you look at go to a mall today
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and it's it's pretty sad. Would look at all of that, right,
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Yeah, it really is, and I don't even want uh and I know
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you mentioned yeah it's kind of sad. But at the same time, back
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in the early nineteen hundreds, you know, the horse and buggy. Nobody
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thought that the horse and buggy would actually disappear until this crazy guy Ford brought
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this this engine along, and it's just bye by horse and money. That's
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just the way business is. It's one of those things that you have to
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I talk about point of inflection earlier to understand your inflection points because and you
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have to have proper analysis to actually see this coming because eventually, when you
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start on that downward path of you know your revenue and employees. Employees know
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what's going on, your customers know what's going on, and they know that
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your only surviving on a thread. And I see this happen time and then
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they call me up on the phone and they say, well, can you
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sell my business? Know, because it's not worth what you think it is
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or it's not worth selling. And so what I tell people all the time
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that if you're in today, have an exit plan today, and you better
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look to exit within a five year period. And if you look at all
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the data, if you look at all the data, and Stacey, she's
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not on this line, but she mentioned it I think a couple of podcasts
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before. But you know all the data that's out there, how many times
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you know the business will succeed or fit so many years or whatever IRS has.
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You know certain data points too, But ultimately that if you start a
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business today, it's going to take you three years to even make a profit.
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But and that's just a rule of thumb. I don't really like to
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say that anyway myself, but point the point I'm trying to make is that
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you better be ready to sell it within five years, and you better have
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an exit plan today right when you right when you start your business, and
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even if you have an existing business, you'd better have an exit plan.
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You better have an evaluation done every year. I can't emphasize this enough because
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I see and I have seen these businesses just go belly up because they haven't.
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They don't do what they're supposed to do. So you know, start
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in January first, right around the corner. You should be thinking about what
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your company needs to focus in on for twenty twenty four for sure, right
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well, again being grounded in reality, so then you can make moves or
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pivots. Right If not that you're going to sell it necessarily five years,
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but it could be could it be sold? Right? Would anyone actually even
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want to buy it in five years? You get hold onto it if it's
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a good investment, obviously you want to hold onto it. But but you
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know, could you sell it? I don't think that's the question you're talking
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about, Curtis, is are you looking at the things that need to be
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done in order to make it attractive desirable? Why would somebody want to come
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and buy it? It's much like you think about I mean, you could
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think about it. Like people when they want to sell their house, right,
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they have somebody come through and walk through their house and they'll evaluate it
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just like you're saying. See. But then if they would have done the
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maintenance house and prepared it, they could you know, and they were did
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those things, it would make the house more valuable and easier to sell.
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But what happens is what I normally see is people get an evaluation like what
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can I do quickly to try and patch up the wall, you know,
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make the make the toilet work again, you know, do these little things
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because they want to make it sellable, but it's not very profitable. You
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might sell it, you might actually get to sell it, but is it
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that profit the bull Probably not if you would have done the planning and the
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little steps you know, over time. And that's what we're trying to get
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out. I think in this in this discussion that we're having today is business
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owners to stop and pause. And this is where I think the danger is.
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There's so much in the doing and uh, you know, we've talked
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about this in the past. The book e Myth, which is a great
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book for any business owner. Right the understanding being the you know, being
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the managing the work, you know, doing the work or being the entrepreneur,
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and you're doing all of those things. And so what we're trying to
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get to you to think of as a business and this is for us too.
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All any business owner needs to be able to put and segment time into,
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you know, not being in the business itself, but really it's working
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on the overall business and the plan there. And this is like you said,
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Curtis, in the sports analogy, they're doing it weekly, but then
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they're looking at there's bigger there. They look at you know, trades,
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they look at how they're going to be positioning themselves throughout the season, all
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the hiring that they need to be and so it's it's it's and it's one
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that candidly, in my experience, it's not one that you want to do
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in a silo alone, because you're an echo chamber. And I think this
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is and this is what I've seen in my past, Curtis, Uh,
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where I've worked for companies that multiple owners, but they all kind of echoed
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each other and they didn't have that, like you said, evaluation, so
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they all kind of kept telling each other, well, we think it's worth
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this and that and the other thing in their mind, but they had no
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external review of it, just very looking at the facts. There's no I
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think this is where this is where you have for larger companies to actually have
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boards outside of the company because you have people you know that are not they
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can look into the company, you know, kind of objectively and give you
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feedback as to Okay, that's working or isn't working. But again, you
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know, share your insights there. It is where you have especially when you
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have it's not just one, but you have multiple business owners that they are
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not yeah you know, they're not looking outside or getting that help, you
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know, yeah, you know. And see what happens is that you want
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to know why a business goes from a half a million to a billion,
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and and what what happens is exactly what we're talking about. See, the
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more the more energy, the more people that you bring to your company through
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salaries, commissions, you know, whatever it might be. And and we're
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talking about obviously key key employees, key management. The more that you actually
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do that, the more valuable your your business becomes. Right And it's it's
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really it's really simple. What happens is that the business owners afraid. Here's
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what they're afraid. They have an ego problem. And the ego problem is
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that they're afraid that someone is going to know more than they do about their
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business. And by the way, there's the secret. You want somebody to
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know more than you to grow the business. And I say this all the
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time when I talk to these business owners. Look, I can help you
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do this. You're going to pay me well to do this, but you
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will benefit down the road, not me. You would when we do this.
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And I'm sure you say the same thing to your clients is if they
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only knew that, let go of your ego and let these people run your
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business. Because it's what you said. You know, you work on your
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business, it's not in it, because when you work in it that that's
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where you have too many hats and you're control freak. You don't want to
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do the hub and spoke. I call it the hub and spoke all the
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time because nobody wants to buy a hub and spoke. They don't. They
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don't want to buy you. You're trying to sell the business. And that's
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you know, going back to the sports analogy. You know, each each
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football team, the NFL team or college team wherever, they already have a
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system. The coaches have a system in place, and then they vary from
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that system, but they have a system based on talent that they've recruited or
20:47
they drafted or whatever. Uh. And you could do the same thing in
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business all the time. You just have to let go and leto. That's
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what coaches. A good coach will let their team and their players flourish.
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They will not hold them back. Right, That's exactly what an owner's got
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to do. The same thing. Well, here here's a question or just
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an observation I'll say, and I'll want your input. So here's something I
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just did recently with a business owner, which I thought was really helpful because
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we're going into twenty twenty four and like you said, a game plan is
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at a high level. You don't have to go super detail, but categorize
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your time in like just even if you just do kind of main buckets.
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If I'm doing technical work, literally, if I'm doing technical work in the
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business, possibly am I managing part of the business or am I being the
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entrepreneur side of the business. Let's just use three simple buckets. Okay,
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there, we could break this down for sure, but even if you just
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did those three buckets and you just did your count, just figure out your
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time per week, per month, and just do some raw numbers, right,
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you would have an idea like how much time I have left the reality
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of this. I went with this one business owner and we looked on a
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typical forty hour week, you know, two thousand and eighty hours in the
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year. We looked at vacation, and we broke down some things and we
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said, okay, if we did all these things, how much kind of
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free time or time would you have outside to do some other elements. And
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we broke it down a little bit more in detail. But what happened is
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when we broke down these kind of categories, she saw, well, I
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really have about five or six hours of like quote unquote unallocated time every week.
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And so it was a reality of like, well, then how am
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I going to actually do some of these things? And so we started to
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go down and exercise of looking at those and kind of refining them. But
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I think you have to have a reality check because what happens is I love
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the in the in the book Seven Habits of Highly Effective People, and I'm
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since where we've talked about this before. Right, the things that are important
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get lost or the urgent and urgent and important things that come in your life,
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which inevitably do come. But if you know what's really important and you
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block your time and you plan for it, you can actually achieve those things.
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But reality is, if you don't like you're saying, or you just
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want to show up and have wishful thinking and hoping that it's just going to
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come somehow magically together, it doesn't just doesn't work that way. You have
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to We've talked about this too. It's the second half in the book.
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You have to begin with the end in mind. What is it that you
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actually want to achieve and for your for you here's it's it's not even just
23:33
the year, it's like five years out. What does that look like for
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you? Where do you want to be? Yeah? Absolutely? And I
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like what you're what you're saying there, because that's why I always say that
23:47
every every every CEO or owner, whatever they need, they need a business
23:53
coach. Uh. You know, we even have the at our firm.
23:57
We obviously have not only the consulting part, but the coaching part. And
24:03
that's two different animals. Consulting and coaching is totally totally different. But because
24:10
you you know, a lot of times an owner spending so much time on
24:18
part of the business that's not even making any money. And and and I
24:25
always ask why why you know? I'll tell you a quick little story.
24:32
I had an evaluation of the manufactured bullets, you know, for guns and
24:37
so forth, and it was out of Nevada, and anyway, to make
24:42
a long story short, he spent one point five million on a automated machine
24:48
that would actually one one man, one individual could actually run it. And
24:56
then he brought me in. He wanted to actually sell his business this and
25:00
evaluate it. And so I did, and I looked at it, and
25:06
I said that this machine is only producing five percent of its revenue. And
25:15
so I asked him why and he said, well, I have thirty five
25:19
employees, and I didn't want to get rid of the employees, so I
25:25
have one man doing this machine, but we're still cranking out the dollars.
25:30
And I said, well, that's ridiculous. Why are you doing it?
25:33
Either a you get rid of the employees and use the machine, or get
25:38
rid of the machine and use the employees. And I said, and he
25:44
goes, well, I'm not going to get rid of the employees. I
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said, well, then here's what you do is you sell a machine,
25:48
get rid of it, and then take some of that money and give your
25:53
employees some bonuses and performance plans and so forth. We went from a two
26:00
point five million dollar company in three years it sold for seven and a half.
26:04
Wow. So the point that I was trying to make is that he
26:08
was all excited. The owner was excited about this machine, but it wasn't
26:14
doing anything for And by the way, that's just one little story that happens
26:21
daily in businesses all the time, right, Yeah. I mean, if
26:26
you're not planning, you know, flip flipping it. I'm well related to
26:29
that actually, just on the people side, because you're talking on a machine,
26:30
but you're talking about the people too, you know. I'm working with
26:34
another business owner right now, for example, and helping her identify key hires
26:41
that are needed in the coming year, right based on projections and workload.
26:45
And it's challenging and especially in today's market, to find good quality talent,
26:51
messaging, preparing, planning, making sure that's communicated well they would come in
26:55
and be successful. So there's planning and This is where you said, like
26:59
a good business code comes in because I'm asking questions and getting clear about what
27:02
does she need, what's her desire, what does that look like? And
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so we're working and planning and preparing, and you know, I've been working
27:11
with this this individual for over a year and now they're finally in this place
27:14
where you know, in the company's life cycle, like you said, uh,
27:18
is that to be able to hire a higher uh, you know,
27:21
more senior level person as this company is growing, And it makes sense now.
27:25
It wouldn't have missed it makes sense a year ago. But that's because
27:29
we're going we're having a dialogue. We're understanding where you're at and where do
27:33
you actually want to go, Where do you want to grow? Because you
27:36
know it's really important, especially in a small business. You know every hire
27:41
is important, but when you're in a small business, you know you're one
27:47
one higher could make or break you. Potentially as you get bigger, that
27:49
it's it's a little bit more cushioned. But when you're when you're smaller,
27:56
you know the one run client could you know, make a one one that
28:00
employee could really turn off a client that could be a key client for example,
28:04
so it's really important that you hire I would say slow to hire,
28:08
quick, quick to fire, you know, uh, and and looking at
28:14
that. But again, if you don't have projections and an understanding of where
28:17
you're at, you know, looking at your budget, like where you're like
28:21
you said, where you're at, Curtis, where your revenue is coming in,
28:23
and then what do you need to do? Because here's I think I
28:26
would love to get your thought on this too, Curtis, because sometimes what
28:27
happens is people's revenue goes up, but the profitability goes down. They actually
28:33
have more sales and volume, and they're like business is working harder, doing
28:38
more or actually earning less. Can you talk about that as far as again
28:44
failing to plan and looking at that kind of grow, yeah, you know,
28:48
And that's where see, that's where an evaluation works really well, because
28:55
just because your revenue increases doesn't mean that your profitability is going to increase.
29:03
And the reason is because your dollar, that your dollars being spent to create
29:07
this revenue, that each piece of that dollar is going more to revenue that
29:15
is not producing the margins. So you actually have to find out what product,
29:22
what service is producing the highest margin, and that's how you're going to
29:27
have to market that. And see, just because your revenue is going up
29:33
doesn't mean that you're profitable at all. And and that's why you have to
29:40
you have to know exactly your customer base. You have to know exactly your
29:45
product, your service, and of course if you do have a product,
29:49
you have to negotiate on the front end, which is your suppliers to actually
29:55
increase those margins. And and you know you do that as well. I
30:00
mean, there's just so many different ways that you can actually structure deals with
30:06
suppliers to increase those margins, to increase your revenue. But by golly,
30:11
you better have the customer that's actually going to buy those products at the price
30:17
that you really want. Yeah, yeah, there is different strategies. I
30:22
was just talking to a client about that too, again, planning for that.
30:26
So if you're let's just say you're expanding either your services or going into
30:30
a new market sector, we're going into twenty twenty four too, so you
30:33
need to look at In my opinion, I work with a lot of environmental
30:37
consulting firms as an engineering construction it's often a good time of year to look
30:41
at where you're at in the market and plan your what I call your commercial
30:45
rates, your your your base rates that you are going into the next year.
30:52
Again planning and preparing because you want to make sure your clients don't get
30:56
sticker shock, that you understand, like your tell them, Hey, here's
31:00
how we're planning this, how we're expanding this, how we're going to provide
31:02
additional services. You need to be able to communicate your message clearly to this
31:06
literally them that they know. I don't know about you, but I've gotten
31:08
some things in the mail or like hey, you know your insurance rates are
31:12
going up twenty percent or whatever. You know, other things are like whoa,
31:15
you know, how am I going to prepare for this? So they're
31:18
looking and they're projecting. These other companies are projecting because they know, hey,
31:22
there's going to be increased costs, there's going to be more challenges and
31:25
maybe more claims on the insurance world. What are you facing that's going to
31:29
affect your bottom line? Like you said, oftentimes most of the time it's
31:33
labor, like you said, actually it's it's that's your biggest, one of
31:37
your biggest costs labor and in any kind of physical environment, that you're maintaining,
31:42
and so again, are you looking at those things? One thing that
31:48
I haven't had that happen to me, but I've read and understood this,
31:52
and I think this is maybe Curtis, you could talk about this. If
31:55
you're leasing, you know, property for your business right and you have something,
32:00
if that changes ownership or any assessment, they have the right to potentially
32:06
change that on you, you know, uh, substantially at times, you
32:08
know, and if you're not prepared for that, that's yeah. And and
32:15
well if you if you're dealing with lease, that's that's a toughye. Because
32:21
if you're a business owner you're actually leasing, I would strongly start looking for
32:28
a commercial property that you could actually buy. And and by the way,
32:31
they're they're they're they're out there, they're out there there, and I would
32:37
advise you to actually do that. But you said it right right here.
32:43
I mean, there's just there's no security at all, you know, no
32:50
matter how well you negotiate your lease. Guess what in in year five and
32:58
because you're negotiating a five year with a your option year five, they decide,
33:02
well, you know what, we're gonna We're gonna put somebody else in
33:07
there and bye by you, and and then it happens all the time.
33:12
You see that all the time. So yeah, when it comes to a
33:15
lease, I mean, if you are a business owner and you listen to
33:19
this, of course the best thing to do is to buy the real estate
33:23
some shape or form for sure. Yeah. Again, this goes into the
33:27
whole planning and repairing. So if you know, you, like you said,
33:30
a five year a lease and you're in, you know, you're four,
33:34
you're three even, I mean you're looking at ahead. You've got to
33:36
plan ahead for what is to come. Yeah, and be ready and don't
33:43
just you know, think about this. Here's another thing that's come up.
33:45
I found in planning and repairing for contingencies that work with business business owners.
33:51
DOXY again is looking and they're thinking the best on unfortunately some of their clients
33:57
and getting paid. But these clients have had issues or getting paid, and
34:02
so now what do you do as a business You're like, oh, I
34:06
thought I would get paid within you know, thirty sixty ninety days. Here
34:09
I literally a client get paid. It was like over a year later that
34:14
they had paid, you know, on a normal cycle, and they still
34:15
haven't got paid. So what are you going to do? How are you
34:19
going to plan or prepare? What's your what's your strategies there for when the
34:22
cash flow starts to dwindle? What's what's your plan? You know, you
34:29
know, let me let me ask you that question, because that's uh,
34:34
I get that a lot too. Is you're a business owner. So maybe
34:38
your thirty days and it becomes sixty days, and now it's ninety days.
34:43
At what point do you do You contact your customer and you actually tell them,
34:51
all right, I'll give you know, I'm going to cut you some
34:54
slack if you can give me seventy cents on the dollar, we'll call it
34:59
a that, you know, or fifty cents on the dollar, thirty cents,
35:02
you know, whatever that might be right, because ultimately, you know,
35:07
when it gets to a period of you know, one, twenty or
35:10
even further, the chances are you're probably not going to get paid, right.
35:19
And you know, I've always I've always worked, and I try to
35:25
work with my clients to go with a thirty day window and anything past thirty
35:31
days then you start your negotiations. And they asked me, you know,
35:36
why would I why would I do that? Well? I said, because
35:38
you you know, when you go to sixty ninety, your the value of
35:44
the dollar just is descending happen, and then you're actually going to negotiate it
35:50
even further. So what you want to do is you try to get those
35:53
dollars thirty days and if you can actually you know, let's say ten percent
36:01
of your customers or past thirty days, that's that's pretty good. Yeah.
36:08
Well, again that goes to looking at your numbers, like you said,
36:10
Curtis, and how do you how do you what's your do you even have
36:14
a target on? You know, here's as a business, if you've been
36:17
in business for a time, you should be looking at what I call your
36:22
accounts receivable as part of your your your journey and looking how do you diversify
36:27
and minimize risk. Again, here's an here's an analysis that I've done in
36:31
the past two Curtis kind of related to that as I worked with a company
36:36
where we had one client that was a majority of the income coming to that
36:42
that and that's not a good place to be. You have had a diversification
36:45
if you're not evaluating that and looking at that and then saying okay, there
36:51
may be a reality and we don't want to be there, then what does
36:52
that what is it? What do you want to be? What is that
36:54
desire? They don't they don't know. I don't know what the desire is.
36:58
Well, we've got to come up with something, because otherwise you're you're
37:00
just setting yourself up, you know, for failure. Here, even the
37:06
best clients have will have challenges or problems, and so if you're not diversified
37:10
and looking at that, I look at kind of either expanding in the market
37:15
you're already in, or adding services and trying to target some additional folks so
37:20
that you're, like you said, offsetting, and especially for the things that
37:22
are more profitable. Oftentimes too, This is a danger though, I think
37:27
Curtis is some businesses will go because well, this client is super pop.
37:30
You know, it's like going into the stock market going all in stocks and
37:34
you're not diversifying. You know, it's all great, you know, it's
37:37
great, but when that goes away, you're if that that's where all your
37:42
business hinges. If that goes away, you'll be closed, you know,
37:46
in thirty days, ninety days. Yeah, And you know I was,
37:52
I was even watching stock this morning. They were talking about some of the
37:57
businesses that have gone bankrupt. And as you mentioned earlier, and you want
38:05
to know, you're kind of asking yourself as a business owner, why I
38:08
don't want to be one of those companies to go bankrupt. Well, that's
38:14
the important to stay on top of all of your uh, your ratios,
38:20
your analytics, all of those things, especially cash where where where's the cash
38:25
going? And and and if you have any debt you know, yeah,
38:31
you know a lot of people they have their own opinions about debt. And
38:36
personally, you know, I'm kind of like an Apple guy where you know,
38:38
you have as much cash as you can, don't don't have a lot
38:44
of debt, unless of course it's mortgage on the real estate or whatever.
38:47
But ultimately, what what you really want to do is you you find a
38:54
way to speed up your cycles. You know, your products out, your
39:00
services out, your cash comes in. And like I said, that thirty
39:07
day window is huge because each time you go past that thirty day window,
39:12
as I said earlier, is you know, you're the value of your dollars
39:15
just dropping as well, you know, and so the business owners, if
39:21
you are listening to this, that the number one thing that probably David and
39:27
I are talking about is is to actually have a game plan and have a
39:31
game plan January first, this is what we want to do for the first
39:35
quarter, second quarter, third quarter, and so forth. And you do
39:38
that every single year, and you top it off with an evaluation because you
39:45
want to find out is my company growing or is it done? By the
39:51
way, that's exactly what's going to happen. You're going to Every business has
39:57
an exit strategy. Don't like it, some do like it, and that's
40:02
that's the reality. Well, if you don't plan, yeah you're not you're
40:08
not going to like your exit well. And and from one from you know,
40:14
from one experience to that point too, Curtis, I think if depending
40:17
on your business model, what you want to do. I worked for the
40:20
company in which we were able, we had the ability at least to buy
40:23
into the company. But we want to know if if that's one of your
40:27
plan, right, if you want to expand business ownership to to the employees
40:30
are key folks. They they too need to know is this business growing or
40:36
what am I am I buying into? Because if you're not clear on that,
40:39
then you know it's it's It affects the ability to to you know,
40:45
retainy people potentially. So that's one point. Yeah, you're you're right,
40:53
but a lot of people don't like to hear this. But it's the real
41:00
how the asist. It's it's about the money. It's always about the money,
41:06
you know. And I mean we can all we can go to our
41:08
our job location and we walk in and everybody says high and you know,
41:15
smile and all that and the culture and that we've talked about before. But
41:22
if you're not making money, if you're not winning mm hmm, see you
41:30
later, it's just there's there's no other there's no other way to describe this
41:38
is if you're not winning, guess what. The head coach, he's fired.
41:43
You know, the players are still going to be there, but the
41:45
head coaches are fired. Coaches are fired, management's fired. People get fired
41:51
if you're not winning. The stakes are high, even at a half a
41:57
million revenue. And I'll tell you this, it is more difficult for a
42:02
company to go from a half million to two million to five million than five
42:07
million to fifty million. Yeah, it is extremely difficult. And because you
42:14
got to let go of some of the things that we're actually talking about on
42:16
this call yep, I've been I've been there, and I can I can
42:21
attest to that actually because there's so many evolutions and changes from a bit in
42:23
a business to go from those those marks. I went with a business to
42:30
million to just over seven million four years and the evolutions that you're going through
42:37
are just tremendous because it's just the nature of the growth curve there. And
42:42
like you said, if you're not creating the framework, and this is what
42:45
I like what you said, you know this winning or I'll say another word,
42:50
bringing value, because that's what I love about capitalism is just an exchange
42:53
of value. If you're not bringing value, and I'll even say victory to
42:58
your clients, to your customer, so they're feeling they're actually winning because they'll
43:02
gladly, honestly pay you if you truly are in their corner and bringing them
43:07
that transformation whatever that they're looking for. That they're feeling that they're winning,
43:12
that they're getting the better end of the deal in their mind. Ultimately,
43:15
that's what you need to be doing as a business owner, is creating that
43:22
in space. And that's what Curtis and I and others on that have been
43:24
on us call are all about. And that's where I would say, when
43:30
you're looking for somebody that's a coach or consultant, is number one, look
43:36
at their track record? Do they bring value to you? Do they actually
43:39
help you win? And talk with others that they've worked with and see how
43:44
their their track record, because unfortunately there's a lot of people that can get
43:49
in there and call themselves a coach or consultant. And reasons I actually was
43:52
slow to even jump into this myself was through your physiness. I wanted to
43:55
know without a shoutow of a doubt that I could bring value to clients and
44:01
help them win. Like you're saying, hurt us, that is really really
44:06
huge because if you have that sense of it and you know that about yourself
44:08
and you communicate, and then you can bring in those dollars because you you
44:14
have a tracker of a record, you know, and you're not how to
44:16
articulate that. But if you don't, if you're not clear on that,
44:21
then you're gonna have a lot, You're gonna have a challenge for sure.
44:25
That's exactly correct. And you know I get asked this question all the time,
44:30
is well how do we win? Well, no, I mean that's
44:35
a that's what they said, Well, how do we win? It's not
44:38
like a football game where you know, you score more points than I do
44:44
you win. But see that's when you said, you know, you've got
44:50
to get more in value. Then you take in dollars. There's your win,
44:55
and that's how do you win. Now, the thing is is that
45:00
those dollars that you take in, you have to make sure that you know
45:05
every cent and where it goes, period, and you have to actually find
45:10
a way to duplicate it over and over and over again. And you know
45:17
how difficult it is. I mean it is. It is difficult. But
45:22
when something when people business owners ask me, how do we win, it's
45:27
the easiest question to answer because if you do, in fact, you get
45:30
more value than you take in dollars, that's the win. And and by
45:37
the way, you continue to do that over and oh, you duplicate that,
45:40
You duplicate that, and once you do that, you develop the system.
45:45
You've developed a winning culture and people understand that what you're going to be
45:52
doing for the customer, for the suppliers, for all your employees and every
46:00
thing that you know that when you walk into David's office, that you know
46:05
that he's going to give you more than what you've bargained for, and that's
46:09
what it's all about. I love that. I think this might be a
46:13
good place to pause us tonight until we come again, because I really think
46:16
I want you guys to think about that as you're listening or wrapping this up,
46:20
is as you're planning and preparing for your for your year, is really
46:23
how do you bring that value? I really like that, Curtis, I
46:27
mean the way you shared that, because that's really about how you win,
46:30
and we want to plan and prepare to win absolutely right, you know,
46:37
and get and I would just throw this in there is get out of the
46:42
mindset of being so darn competitive, you know. And I get it.
46:46
I mean I understand it. You know that you're trying to keep your doors
46:50
open. I get that. But let me tell you. If you get
46:52
more in value, as you said before, I'll tell you what, You're
46:59
just going to see. Your whole culture, your whole systems are going to
47:04
be changing if you do that. And it's kind of kind of put aside
47:07
the competitiveness because uh, com audition can really really ruin things. But just
47:15
think in terms of that value piece that you mentioned before what we've just been
47:19
talking about, and I think this is a good place to stop as well.
47:22
Yeah, yeah, it's it's there's the competition, but it's kind of
47:25
like if you're looking at the competition. To me, I use the analogy
47:29
last last podcast episode, it's like looking at a pothole, you're kind of
47:32
kind of crash into that that that's there. We've got to acknowledge it.
47:36
But we want to know where do you actually want to go, Who do
47:38
you want to become, Who do you want to serve? What is your
47:43
unique value? Competition and and and and who who really needs to hear from
47:47
you? And and have you your support and bringing that value? And i'd
47:52
say, you know, victory in the marketplace. Be really really clear on
47:57
that. Be clear, and we've talked about this in the past. Your
48:00
mission, your values, your your vision. What is this that you want
48:04
to come into because those are your or over arching you know pillars if you
48:07
will, that we're going to build under all of these details for your plan.
48:13
Understand truly who that is, who you are, who your company is.
48:16
It's not you as an individual, it's this organization that is, you
48:21
know, beyond just you. Like you said, Curtis, is that you've
48:24
got to get out of the way as an entrepreneur. It's more than you.
48:29
Absolutely, it's a great conversation and I thank you so much Curtis for
48:35
sharing this time with me. We'll be back. We'll have probably some of
48:39
our regular contributors back, Stacey and Charlie and Bill uh And if if you're
48:45
so inclined and you have an idea for the podcast, we would love to
48:51
hear it. We welcome that, we'd love you to share it. It's
48:54
always great to get comments and feedback on what you took away, so please
49:00
do comment and share. We appreciate that, and until next time, we
49:04
wish you all the best. In twenty twenty four, come back and get
49:07
ready for a lot more to come. We're so thankful for you the Business
49:12
Roundtable podcast David Carr and Curtis Cochrane wrapping that tonight. Thank you so much.