The Void #6 ** Core Episode ** Systems and Processes (3 of 3)

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[Music]

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hey everybody and welcome to the void a

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show dedicated to filling the void

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between being an employee and becoming

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self-employed most people refer to

00:12

starting your own company as taking the

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leap as if they are blindly jumping off

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a cliff and into the unknown

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this show is here to help show you that

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it doesn’t have to be that way at all

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i’ll share with you the process i use

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for starting my own company and you too

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can soon be on your way to starting your

00:28

own service based company we’ll work

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through some common issues that are

00:32

preventing you from starting your own

00:33

company and filling your own true

00:35

potential

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as always if you like what you’re

00:38

hearing on the show

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please do us a favor and help share the

00:42

void with someone else who you might

00:44

think also wants to start their own

00:46

company we saw an opportunity to help

00:48

others understand that self-employment

00:50

is well within your reach and just as

00:52

our businesses have grown organically

00:54

and by word of mouth we want this show

00:56

to grow in the same way it takes two

00:59

things for that to happen we have to

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provide you with great information and

01:02

great content and you have to help share

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our valuable message

01:07

we know that many of you are out there

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on different social media groups for

01:10

your various trades or skills or crafts

01:12

and those groups are begging for this

01:14

kind of info virtually every day so if

01:16

you see somebody asking questions about

01:18

starting their own service based

01:20

business please do us a favor and drop a

01:22

link to the show in the comments on

01:24

those posts i’m your host mitch smedley

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and which with me as always is david

01:30

hilton mitch what’s going on man what’s

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going on doing pretty good i’m feeling

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great i’m good marcus i’m great mr

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producer marcus what’s going on this

01:37

morning bud how’s it going good man

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marcus is cold he’s going i am freezing

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in here he’s got yeah a hoodie

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a coat yeah a beanie our studio is

01:47

thinking about breaking out the gloves

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to be questionable at times it’s

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the temperature is not i didn’t put the

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heating and cooling in in this one i

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probably should have uh you know so but

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that’s okay

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full full disclosure here our studio is

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in a storage room above my garage it’s

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got its own heating and cooling system

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however right now it’s about 10 degrees

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outside so our garage is pretty cold

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yeah getting the getting the studio

02:10

temperature on the point can be a little

02:12

bit challenging i’m not showing them

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so i’m good

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we’re not answering it you’re not too

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cold

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in the last show we talked about

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quickbooks and banking and accounting

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and uh we also talked about behaving

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like the customer that you want for your

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business yeah before we dive into

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today’s show does anybody have any

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questions about last week’s

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no i’d like to go over you know just the

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regular adversities yeah where this is

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going to be the last episode of the

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third preparation adversity

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yeah so so we’ve got we’ve got three

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preparation steps that we’ve prepared

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for you and those were you know we’ve

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already been over them yeah one’s

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personal finance prep that’s episode one

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and two business finance prep episode

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three

02:54

system prep episode four five and six

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we’re on episode six right now yep okay

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and those are just the preparation

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adversities getting you ready to start

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the company yep okay after you start it

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you’re ready to go then it’s beginning

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adversities

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uh four

03:10

community involvement work step four

03:13

episode seven episode seven it it’s a

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little confusing that’s why we bring it

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up every time okay number five uh wake

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up do work repeat that’s step five

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episode eight yes and then six is

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evaluate performance make adjustments

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and improve that’ll be the final uh

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episode of the adversity group and

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that’ll be episode nine yep so the first

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nine episodes of this show are going to

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be titled core adversities and they’re

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going to be kind of lumped together and

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so if you’re if you’re just now tuning

03:44

into the show you’re going to want to go

03:45

back and listen to the first nine

03:46

episodes in order

03:48

um let’s say you’re tuning into this

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show way down the road you can listen to

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those first nine episodes and then kind

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of jump back in wherever you don’t

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necessarily have to go listen to every

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episode i mean we’d like you to yeah you

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totally could i mean

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we’re not making money off any of the

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episodes but right you know we have our

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egos are you know there’s some ego there

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it’d be nice if you’d go back and listen

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to those we’d appreciate it we we just

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knew early on that we needed to organize

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this in a fashion to where you don’t

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feel like you have to play catch up and

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listen to every episode out there but

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you do need to listen to those first

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nine for sure yep so um on today’s show

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we’re going to talk about llcs and

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s-corps and sole proprietorships we’re

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also going to talk about setting up some

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of the tracking mechanisms that you’re

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going to be using later some more of

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those systems prep yeah this is this is

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setting up so one system is how your

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business is going to operate from that’s

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your your filing status your llc or s

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corp or whatever

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another system that we’re working on

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today is setting up how you’re going to

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track your performance later so once you

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start your business you’re going to need

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to be tracking your performance but

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before we start the business we have to

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set up those tracking mechanisms today

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and we need to do that because

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hopefully when you take off you’re going

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to be so busy doing work and doing those

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things you don’t want to have to be

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trying to fumble around with setting up

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those systems yeah you know to help you

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so yeah

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you want to get those done first yeah

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and the last thing we’re going to talk

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about today is uh we’re going to talk

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about uh trashing your fellow

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tradespeople or your competition and

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we’re going to talk about some of the

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bad things that can come when you start

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trashing some of your competitions

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that’s being professional that’s uh

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being a good salesman it’s not just

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about

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don’t talk smack right right it’s more

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millionaire mindset type of stuff so uh

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starting off

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sole proprietorship

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llc

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or s corp what is going to be best for

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you well let’s say right now there are

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more than that

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that’s what we’re focusing on because

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we’re into the small business starting

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out and those are the ones that fit that

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criteria the best yeah you’re not going

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to you’re not going to make the switch

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from self-employed or from employee to

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self-employed and go right into c-corp

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that’s that’s more entrepreneurial type

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stuff that’s more big giant business

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venture

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venture capitalists where you’re seeking

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investors and all that that’s that’s a

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whole different ball game that’s not us

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from you working for somebody to working

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for yourself and you can get to that

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yeah oh yeah this is this can be a plot

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your your llc can be a platform for you

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to go anywhere yep absolutely um

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obviously

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the legal answer to everything that

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we’re going to talk about here is

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contact your tax professional

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we’re not known for being too official

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so we’re gonna blend

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that with some of our own life

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experiences of what worked best for us

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and you should always we’re gonna we’re

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gonna give you

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questions to ask your tax professional

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right what you know

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and we’re going to do the first initial

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breaking down

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of those things because a lot of people

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think when you when you go to someone

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and you say uh sole proprietor llc s

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corp they immediately have this fog

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we’re going to try to break that fog

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down a little ways yeah so that then you

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can go to your accountant and say

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okay

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i know that i could do this or this

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these are going to fit me the best yeah

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but what is the exact answer and which

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way do i need to go yeah my accountant

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has often told me that he wishes more of

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his clients had a better understanding

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of taxes like i do now i’m not a tax

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professional i know just enough about

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taxes to ask the right questions yes i

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let my tax guy do all of the the smart

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work and you just did pre-research yeah

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and we’re breaking down that

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pre-research yeah to get you there

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exactly we’re going to clear that fog a

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little bit so that you too can ask the

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right questions to your tax

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professionals so um

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first off let’s hit up sole

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proprietorships

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i am not familiar with any platform

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where a sole proprietorship would be a

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good option um that doesn’t mean they’re

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not out there uh obviously they’re out

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there because people do it but um the

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biggest downfall is there is no limited

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liability protection against you as a

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person yeah so so for these type of

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companies

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it does it

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99 of the time it doesn’t work

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uh

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for us yeah

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you’re

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um if if somebody with a sole

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proprietorship if somebody tries to sue

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your business they’re also suing you yes

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and that is not good right you don’t

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want to lose your house because somebody

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sued your business you know and

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and you might think oh well everyone all

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everyone ever says is llc llc llc well

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there’s a reason it works yeah okay and

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it works so again we’re not saying don’t

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do sole proprietor we’re just saying

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that for the types of businesses that

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we’ve had it was definitely not an

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option for us so

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now llc versus s-corp oh man

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the biggest so both of them offer you

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protections per like to separate your

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personal finances away from your

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business finances yes

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the biggest difference between an llc

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and an s corp is

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uh the amount of money

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the biggest difference that’s going to

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make you choose one or the other is the

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amount of money that you are making

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um and why is that uh well an s corp is

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a corporation and filing corporate taxes

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costs a lot more money than filing

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personal taxes an llc is a pass-through

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entity which means all of this money

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you’re making on the business passes

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through the business and onto your

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personal finances and so filing personal

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taxes is cheaper than filing corporate

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taxes and so what happens is as an llc

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um you’re you’re paying a cheaper tax

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filing amount your accountant’s charging

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you less

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well eventually you start making enough

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money where

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you could actually file as a corporation

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and save yourself some tax money but you

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got to make so much in order for that to

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even like teeter-totter and flip the

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scale yeah and an escort i mean

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the taxes pass through to you

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um but in a different way yeah so um

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as an llc

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anything that shows as net profit you’re

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paying taxes on that as personal income

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yes so even if you think in your mind’s

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eye

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i’m gonna save

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this money this is not going to be my

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money this is going to be the business’s

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money well if you’re an llc you’re

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paying taxes on that money yep now if

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you’re an s corp you’re only you can you

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are allowed uh different tax liabilities

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to say hey no i’m going to take that

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money and that’s going to be for future

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use over here on this or on this and

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your accountant’s going to say okay as

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an s-corp you can take that money and

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file it away over here and not

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pay um

10:47

i don’t want to say taxes but

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you’re not going to have to pay uh

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profit taxes on that money right

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so

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the biggest tipping point between llc

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and s corp is about 80 to 100 000

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of of net income

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so

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um if your business is netting and

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that’s a rule of thumb yeah it’s it’s a

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rule of thumb uh and and again your

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situation might be different however if

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your business is netting between 80 and

11:16

100 000 of profit or income

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net income

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then

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you’re pri you’re gonna hear your

11:24

accountant wanting to flip you over from

11:26

llc to escort and not every time but you

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know 80 of the time he might be saying

11:32

okay when when

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my clients come in and they’ve bumped to

11:36

this

11:37

number that’s kind of my personal

11:39

threshold for hey we need to start

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thinking about doing something else

11:43

yeah the so that 80 to 100 000 number is

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literally the break even number between

11:49

the amount of money you’re going to save

11:51

on your taxes by filing s corp versus

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llc and the additional money it costs to

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file those s corp taxes so

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um at 80 grand is kind of the tipping

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point at 100 grand it’s it’s cheaper for

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you to be an s corp than it is an llc

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yeah and those are questions that you’re

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going to want to ask your accountant and

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actually he’s going to ask you so if you

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go to an accountant and he says okay so

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how much money do you think you’re going

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to make the first year and you say 50

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000. he’s going to say we’re going to

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file an llc llc we’re going to move on

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now if you want to get to an s corp

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later what you know that’s what you’re

12:24

going to go to and yeah let’s talk about

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just escort for a second you know when

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people think what’s an s corp well s

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corp is a corporation and the s stands

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for subchapter and that’s a tax

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classification okay and now

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and you might say oh what’s a tax

12:39

classification i don’t know what you

12:40

know you know what is that ask your

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accountant okay

12:44

you know and he’s going to break it down

12:45

and say okay if if you guys are making

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this

12:48

and the reason we can’t go into it is

12:49

because we don’t know what your

12:50

overhead’s going to be so

12:53

your the amount of money that actually

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shows as profit is going to be different

12:57

no matter what type of business even if

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they’re if we were all five plumbers

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right you know all of those are going to

13:02

be different this guy’s got a building

13:04

this guy’s got 18 trucks this guy’s got

13:06

one truck this is a one-man shop he

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works out of his wife’s minivan

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right so they’re all going to be

13:10

different but

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so those are the questions that you’re

13:12

going to want to ask them i mean the s

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corp is a corporation

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okay and then it just has a different

13:19

designation which

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you know puts you into a different tax

13:23

liability yeah and again our our goal

13:26

here is not to tell you what to do our

13:28

goal is to arm you with the information

13:30

so you can be talking to your accountant

13:33

with confidence

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much like some of the other topics we’ve

13:38

talked about so far

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we were going to give you some options

13:41

and arm you with some information but

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then i’m also going to share with you

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experiences that i did or that i had

13:46

starting my own company

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so um i used an llc

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i was a little unsure of how much money

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we were going to be making i had i

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definitely had some goals in mind but it

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wasn’t guaranteed nothing is and so we

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started out as an llc

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we started our business halfway through

14:03

the year we opened our business on

14:04

august 1st and so i had prior

14:09

income

14:10

from working for somebody else up

14:12

through that year yeah so you’ve already

14:14

paid your taxes for those first six

14:16

months right or a portion of them

14:17

depending on how the rest of the year

14:19

worked out right right and so i spent

14:21

seven months working for somebody else

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and then i spent five months of that

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year six months five months of that year

14:26

working for myself um

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so

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an llc is a pass-through entity that

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files on your personal taxes and so at

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the end of that year the business our

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business did okay but then you take what

14:39

the business made in those five months

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come on combined with my salary that i

14:43

was making working for somebody else for

14:45

the first seven months of the year and

14:48

that immediately put us into a

14:50

classification where it was cheaper to

14:52

go s-corp and so in my own personal

14:54

experience

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we

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did what they call a late designation

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where it’s basically you write this

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letter to the state and you say hey look

15:03

we made more money than we thought we

15:04

were gonna and so

15:05

um

15:06

we’re gonna do a late designation and

15:08

request that we’re allowed to flip over

15:09

to an s corp status and this is all

15:11

advised by my accountant they almost

15:13

always let you do that yeah yeah yeah

15:14

okay and so my accountant said you need

15:17

to do this it’s going to save you money

15:18

on your taxes and i said okay you know

15:19

he’s the expert and so that’s what we

15:21

did

15:22

so don’t think you can make a wrong

15:23

decision if you think well i don’t think

15:25

i’m going to make more than 80 or 100

15:27

but then you end up doing it you can

15:28

always file a late designation later if

15:31

you would like yeah and if you think

15:32

that you’re going to be

15:34

your spouse works and you’re going to do

15:36

crafts from home but you’re going to

15:38

sell them online and you’re going to be

15:39

showing some

15:40

additional revenue just do an llc yeah

15:43

it’s easy you go right on legalzoom yeah

15:45

yeah we haven’t talked about any of that

15:47

but you can go on legalzoom or the

15:48

secretary of state website um

15:51

and file that get your tax id number

15:54

yep and you’re rolling right so you know

15:56

we’ve we’ve teased about it before like

15:57

we’re going to talk about how to set up

15:59

your llc and all that stuff yeah why

16:00

don’t you do that since i brought that

16:01

up out of order yeah that’s fine

16:04

it’s it’s easy like everyone makes it

16:06

out to be this giant hurdle and that’s

16:08

why i can’t start my businesses because

16:09

i don’t know how to set up an llc you

16:11

literally go to the google machine and

16:13

you type in how to set up an llc in

16:15

whatever state you live in yeah don’t

16:16

forget your state because they are

16:18

different right and you scroll down

16:19

through google and skip the first five

16:21

or seven you know things that are always

16:22

ads and you go back down to the actual

16:24

organic search results yeah and you’re

16:26

going to find the secretary of state

16:28

website for your state and you’re going

16:30

to click on that and it’s probably going

16:31

to bring you to the exact page you need

16:34

to file for your and they’re a lot

16:36

easier than they used to be yeah i mean

16:38

they realize oh you know what and listen

16:40

again the government’s out to make money

16:42

so the easier it is for them to get you

16:45

there and pay your fee yeah they’re

16:47

happier so now it’s almost like they’ve

16:49

streamlined it yeah and everyone can

16:51

just go on there and be like

16:53

they send you your tax id number yeah

16:55

the government wants you to be a

16:56

business because businesses pay more

16:58

taxes right so the government will use

17:00

any excuse they can to call you a

17:02

business yeah and so yeah they will i

17:04

mean i’m serious like um and and so

17:07

they’re going to make it pretty

17:08

streamlined but you can also do

17:10

legalzoom and just pay them and there’s

17:11

like a phone like

17:13

they’ll they’ll set up a phone call

17:15

there’s a phone call where they they

17:16

call you and it’s like 249 bucks and

17:18

done you’re like official and and don’t

17:20

get me wrong they have these other

17:22

add-on options too where you can like

17:24

protect your business in this way for

17:26

like 400 and you can do all this again

17:29

our advice is not to tell you what to do

17:31

our advice is to prepare you

17:33

to for what you’re about to see and and

17:35

to prepare you for the right questions

17:37

to ask yeah and now listen if you

17:40

if you were searching for an accountant

17:42

we talked about this in the last episode

17:44

and you’re calling around to accountants

17:45

if you called one

17:47

out of the blue and said hey i want to

17:49

start my own company i’m looking for an

17:51

accountant

17:52

what do i do about llc and sole

17:54

proprietorship or s corp yep he will

17:57

probably tell you that information over

17:58

the phone for free yeah look hey mike i

18:01

charge 350 bucks you can go and i’ll do

18:04

everything for you and we’ll get you set

18:06

up you can go to legalzoom if he’s a

18:08

reputable accountant that’s probably

18:11

what’s going to happen now not all of

18:12

them right i mean and say he says you

18:14

know why don’t you come in and we have a

18:16

consultation fee of fifty dollars we sit

18:18

down with you for an hour and get you

18:20

know

18:20

it 50 bucks is not a big deal okay

18:23

and i was just using that as an example

18:25

i mean guys aren’t they’re not always if

18:27

they’re reputable they’re not looking to

18:28

gouge you right they’re looking to be

18:31

a part of your team yep and get you

18:34

rolling on the right foot because guess

18:35

what just like the government when

18:38

when you’re making more money and having

18:40

a

18:40

having to have them uh

18:42

put more time in they’re making more

18:44

money also right right the more work

18:46

that they have to do for your fun for

18:48

doing taxes and everything on your

18:50

business the more money they’re making

18:51

so they want you to be successful

18:53

um

18:53

so for me personally i like the

18:55

versatility that came with an llc it

18:57

gave me the protections i needed but um

19:00

it also gave me the versatility to

19:02

perform the business like i wanted to

19:04

early on the biggest question a lot of

19:06

people have about

19:08

all of that stuff is like how do you pay

19:10

yourself so for me as an llc we talked

19:13

about that a little bit in the previous

19:15

episode we’re going to get a little more

19:16

depth right here yeah yeah so as an llc

19:19

llc’s owners especially before you have

19:22

like employees and legitimate payroll

19:24

going if you’re a one-man shop and

19:26

you’re an llc

19:28

you’re not on payroll no you’re writing

19:30

yourself a check you’re writing yourself

19:31

a check and so you’re gonna do what’s

19:33

called an owner’s draw yeah members draw

19:36

yep lots of words for it and so what

19:37

that means is literally the business is

19:39

writing a check to you personally and

19:41

that’s your paycheck yep okay now

19:44

be smart with it

19:46

don’t pay yourself too much yes you’re

19:48

depleting cash away from the business

19:49

that the business needs in order to

19:51

perform

19:52

also

19:53

that money is not taxed yet from going

19:56

from business to personal it will be the

19:59

second you write that check there’s no

20:01

hiding where that money goes right it

20:03

went into your personal account you

20:05

wrote david hilton on it you wrote mitch

20:07

smedley on it guess what they know right

20:09

now

20:10

that money is for you that’s your money

20:12

and now it’s a paycheck so

20:15

what i did

20:16

was

20:17

i would take an owner’s draw i’m just

20:19

going to use round numbers if i wanted

20:20

to pay myself a thousand dollars a week

20:24

what i would do is my owner’s draw would

20:26

be for 30 percent more than what i

20:28

wanted to pay myself

20:30

so i would do an owner’s draw of

20:33

hundred dollars each week from the

20:35

business to my personal finances the

20:37

business would literally write a check

20:39

yeah to mitch smedley personally yeah

20:42

and then i would take that thirteen

20:44

hundred dollars

20:45

and i would

20:47

put it in my bank account but then i

20:49

opened on a personal bank account i

20:51

opened up a second bank account that was

20:54

like you in you know today’s day and age

20:56

you can do all this digitally and i

20:58

nicknamed that bank account tax savings

21:00

account yeah so then i would take that

21:02

extra 30 that i paid myself that 300 and

21:05

i would immediately move it to my tax

21:07

savings account yeah

21:09

what that does is it allows me to see

21:12

income but it also sets money aside for

21:14

the taxes that i will have to pay

21:17

eventually yes and uh i did that for the

21:21

first five months of our business

21:23

and here comes you know january february

21:26

march april whatever’s tax tax time

21:28

lo and behold my tax savings account

21:31

that i had been saving that extra 30 on

21:33

every month was darn near to the penny

21:36

what it needed to be to pay my taxes and

21:38

30 and and for guys that are making

21:41

this is another rule of thumb if you’re

21:43

making a hundred grand a year okay

21:45

even if and if your wife’s working or

21:47

not working that 30 to 35 percent number

21:51

is almost always correct it’s it’s

21:52

fairly close and worst-case scenario

21:54

let’s say you’re saving 30 you come out

21:56

where you’re only paying 26 in taxes

21:58

that’s a bonus you got your year-end

22:00

bonus you got a little bit it’s no

22:01

different than when when you go do your

22:03

like when you’re working for somebody

22:04

else and you do your taxes and you get a

22:05

tax refund same thing that’s your same

22:07

refund right so and the way i did it

22:09

just as an example is just a tiny bit

22:11

different so i always i tried to base

22:13

everything off of 100

22:16

so i would and usually i wrote myself uh

22:19

either one or two checks a month so say

22:21

i was gonna write myself a two thousand

22:23

dollar check but it was the same thing i

22:25

would just okay i’m gonna write myself a

22:27

two thousand dollar check i’m gonna take

22:29

30 of that let’s say it was a thousand

22:31

just for easy math

22:33

i was gonna write myself a check for a

22:35

thousand dollars i’m gonna take 300 of

22:36

that and i’m gonna move it to this

22:38

savings account yeah and i just left it

22:40

in there i took 700 and put it in mine

22:42

and then that freed me up to know

22:45

in the back of my mind that 700 is mine

22:47

i don’t have to do anything with i could

22:49

give it to my wife and say here that’s

22:51

that’s my paycheck do with it what you

22:53

will yeah and then at the end of the

22:55

year when the piper came i had that

22:57

money and they said okay hey you owe us

22:59

6 500

23:01

oh look this checking account’s got 7

23:03

300 in it right i’m covered i’m ready i

23:06

write a check out of that account right

23:08

and whatever’s left i could leave it

23:09

there for the next year yep i could take

23:11

that out because now that’s my money

23:13

i’ve paid taxes on that money already

23:15

yeah down the road i went and you could

23:17

even because again you’re paying your

23:19

taxes kind of a few months after the end

23:21

the year’s over right so

23:23

um and that’s on yearly taxes we’re not

23:25

talking quarterly that’s on yearly we’re

23:26

going to go into quarterly we’ll go into

23:28

quarterly later however your first year

23:30

in business you will not be paying

23:32

quarterly taxes quarterly threshold yet

23:35

right quarterly taxes are derived in

23:37

your second year of business and they’re

23:38

gonna use

23:40

what you made in your first year and as

23:42

well as some other information to

23:43

develop estimated quarterly taxes so you

23:46

will not be doing quarterly taxes in

23:48

your first year that’s why you have to

23:49

do it this way

23:52

the

23:53

the other thing that we’re going to talk

23:54

about taxes

23:55

is

23:56

happily pay them and this seems

23:59

backwards and there’s a lot of people

24:01

that don’t like paying taxes and i get

24:03

it however

24:04

in order for you to be successful

24:07

you got to flip your mindset to a point

24:09

where you are happily paying taxes

24:13

again it doesn’t make it less painful

24:15

you’re not happily but you know that

24:17

you’re doing the right thing and doing

24:19

the right thing is the puts you on the

24:21

right path right

24:23

people that refuse to pay taxes or that

24:26

don’t happily pay them are usually the

24:28

ones that get in trouble they’re the

24:30

ones that are taking the owner’s draws

24:32

for all of the money that’s left in the

24:33

business bank account and they’re buying

24:35

the boats and they’re buying the trucks

24:36

and they’re buying the lake house and

24:38

then they’re saying woe is me later when

24:41

the tax man comes and

24:44

totally hoses them and they ask for

24:45

their money and they don’t have the

24:46

money to pay it so um yeah and then

24:49

they’re oh the government’s out to get

24:51

me right right you have to be good you

24:53

weren’t smart you didn’t have the

24:54

discipline you know what let me can i

24:56

bring up a point about

24:58

um that may make it easier for you to

25:00

pay your taxes so um and i’m not trying

25:03

to get political here but but trump was

25:05

on like

25:06

a week ago on a show and he said

25:08

we need to take credit everyone in this

25:11

country needs to take credit

25:13

for creating the coveted vaccine because

25:16

that was tax money

25:19

that was used to create those vaccines

25:22

and give those out for free it wasn’t

25:24

for free we all paid for it right okay

25:26

right right right what the tax dollars

25:28

yeah use that you know use that as to

25:31

soften the blow right now are they i

25:33

don’t want to get too political but are

25:34

they always using our money wisely no

25:36

right but they’re using it efficiently

25:38

no

25:39

but but wisely some yes yeah you know

25:42

and i’m happy to pay that and and look

25:45

more when it comes to taxes don’t get

25:46

those roads done don’t look federal as

25:49

much as looking local yeah um your taxes

25:52

go to schools and go to roads and go to

25:55

your local city that you live in and

25:56

everything else but yes they’re a part

25:58

of those state taxes go to that yeah so

26:00

you know look look a little more

26:02

tangible and a little bit more local

26:04

it’s easy to get lost in the fog of

26:06

taxes when you i mean

26:09

there’s there’s no shortage of problems

26:10

in this nation and and it’s a whole lot

26:12

easier to find problems than it is to

26:14

find success it is and that’s why i

26:16

bring that up you know sometimes you

26:17

need a little nugget yeah to to keep you

26:20

going and when if you’ve ever been to

26:22

another country for example and driven

26:24

down the roads and then you come home

26:26

and you’re like you know you oh

26:28

you can’t drive so many potholes and

26:30

you’re in another country and then you

26:31

come home and you’re like oh right

26:33

our highway system is amazing i’m gonna

26:36

go from new york to california

26:38

in two days yep you know it’s just

26:42

you know sometimes we’re spoiled yep

26:45

take those little nuggets and say hey

26:47

you know this is your taxes that’s my

26:49

sign

26:50

that i paid for right there right you

26:52

know i did the work i paid my part and i

26:54

did that and i’m not saying

26:57

i love tax paying taxes we should all

26:59

pay 90 taxes no no no but try to just

27:03

get a little bit of reprieve try to have

27:05

a little perspective

27:06

like we talk about right when you’re

27:08

paying those taxes yeah and if you’re

27:10

willing to lie on your taxes to get out

27:12

of paying them that means you’re willing

27:13

to lie to your customers and as we’ve

27:15

said before customers have an excellent

27:17

meter and so if you’re willing

27:18

to lie to your customers and willing to

27:20

lie on your taxes your customers going

27:21

to pick that up

27:22

so um

27:24

there’s great honor in knowing that you

27:26

are completely above board and honest

27:28

with your taxes we talked about that in

27:30

the last episode we are so above board

27:31

in my company that you know bring on an

27:34

audit right and yeah it’s good it’s a

27:35

pain in the ass and it’s a whole bunch

27:36

of work to work through an audit however

27:38

i ain’t scared because we’re doing

27:40

everything so above board it ain’t even

27:41

funny like they would probably laugh and

27:43

they’d be like you really deposited all

27:45

this cash yeah like

27:47

most people like try to skim a little

27:48

bit of it yeah you know so

27:50

um

27:51

once i’ve said this before i’ve never

27:53

taken cash and not paid taxes on it just

27:56

let the records say right right right

27:58

right no so just lots of record state

28:00

not that’s what happened scout but you

28:02

know not only is it is it uh dishonest

28:05

to lie about your taxes but you’re also

28:07

shooting yourself in the foot in the

28:08

future you know when businesses need to

28:10

borrow money to grow and expand if

28:12

you’re showing smaller profits because

28:14

you’re hiding some some income well

28:16

guess what banks are going to see that

28:18

it can hurt you later and they’re going

28:19

to say well you don’t have enough income

28:20

to get this loan well no i do it’s just

28:22

i didn’t report half of it yeah

28:25

like okay you’re a right

28:27

sorry so uh your financials are a direct

28:30

link to your future performance it’s

28:32

okay to show a lot of income and in your

28:35

banks you’re going to want to see that

28:36

in the future i just i just learned

28:38

firsthand so

28:40

about a week ago we completely upgraded

28:43

our entire fleet of vehicles in in our

28:45

fleet we have three plumbing vans um i

28:48

bought them all less than two years ago

28:50

and i had an opportunity to upgrade our

28:52

vehicles to get larger vehicles because

28:54

the vehicle crunch let’s be honest so it

28:57

works out so so i was able to trade in

28:59

all of our other vehicles i traded them

29:01

in for a lot more than i paid for them

29:02

but i also paid a premium on the new

29:04

ones and so i needed to

29:05

borrow the money i didn’t need to i

29:07

could have paid cash for it but i wanted

29:08

to see if i could borrow the money um

29:10

and so that way it kept my cash in

29:12

reserve and because of our awesome

29:14

financials that we put out with our with

29:16

our

29:17

you know honest and ethic performance uh

29:20

honest and ethical performance because

29:22

of those um a bank was willing to come

29:24

through we’ve been in business for 18

29:26

months yeah and a bank was willing to

29:28

say yeah we’ll loan you money on offer

29:30

now let’s say is that unheard of

29:32

um it’s it’s not unheard of it’s a

29:34

little rare but it’s a little rare now

29:36

they went now let’s be honest they went

29:38

through every monthly statement yeah

29:40

they sat down and they were like okay

29:41

what did you do this month where did

29:42

everything go what where did what do you

29:44

do this month where did everything go

29:46

and then they but

29:47

it’s really like that by doing that

29:50

yes

29:50

they can see your cash flow

29:53

okay by doing that and then they can say

29:55

okay well he spent that on this right

29:57

you know what he doesn’t need that now

29:59

right he’s bought these trucks so that

30:00

cash flow can come here and a s

30:03

and a good businessman that works at a

30:05

bank a loan officer you know if you will

30:08

there you know they can go through all

30:09

that bs as we like to call it and see

30:12

where the actual numbers are yeah yeah

30:14

so you know if i would have been under

30:16

reporting my revenue

30:18

and pocketing some of that money that

30:19

bank would have said you don’t have

30:20

enough revenue to do this and it would

30:22

have shot me in the foot yeah so because

30:24

i’m doing the right thing when it comes

30:25

to taxes it helped me out tremendously

30:27

yeah now let’s now he’s not saying

30:29

um

30:30

just report everything is profit every

30:32

time you owe it to yourself and your

30:34

business to take every deduction legal

30:37

deduction yes that you can to preserve

30:41

as much money as you can so that you can

30:43

spend it as you see fit yeah and on

30:45

trucks a lot of people like your raises

30:48

yeah advertising you know you you have

30:50

to focus that money and a good

30:52

accountant like we’ve said 50 000 times

30:54

is going to help you do that yeah you

30:56

want to work the best within the system

30:57

that’s given to you yeah we don’t pick

30:59

the system no but we have to but there

31:01

are rules and there is an outline and

31:03

you have to

31:05

navigate that maze of right

31:07

right to try to do the best that you can

31:09

with what you’ve earned right um i

31:11

recently heard a story uh of a guy who

31:14

was fudging his taxes for like six years

31:16

he’s been in business for six years and

31:17

he was fudging no names no names no

31:19

names

31:20

um it finally caught up with him

31:22

and

31:23

now he’s in with a good accountant that

31:26

does things above board and now his good

31:28

accountant says i got bad news for you

31:31

you’re in trouble bud you owe a hundred

31:32

and fifty thousand dollars in back taxes

31:35

and you don’t have a choice i’m not

31:37

laughing at him i mean i would just like

31:39

if an accountant said that to me i would

31:42

just laugh because i wouldn’t know what

31:43

else to do just be like oh right dude so

31:46

that’s not a story anybody wants to be

31:48

involved no of course not so you owe it

31:50

to yourself like i’m a nightmare nobody

31:52

ever wins against the irs nobody unless

31:55

you kill them all i’m kidding irs always

31:58

wins and so because of that

32:00

you’ve got to do the right thing when it

32:02

comes to taxes

32:04

um next is going to be getting audited

32:06

soon yeah dude i’m on the up and up

32:10

next thing to talk about my account is

32:11

awesome he keeps track of everything

32:13

that stuff goes in

32:14

and i mean they are well you want to

32:16

kill them so they are on it the irs

32:18

agents

32:19

some of them

32:21

next thing to talk about

32:22

key performance indicators

32:25

what do we mean by that mitch so the

32:27

nickname for this is kpi but these are

32:29

the things that are going to tell you

32:31

uh day to day week to week month to

32:34

month how your business is performing so

32:37

with and this is why they’re called key

32:39

performance indicators these are the

32:40

things that indicate to you whether

32:43

you’re performing um above goal below

32:46

goal or at goal or whatever you want and

32:48

these are movable you set them you also

32:50

set your own goals so

32:53

we’re going to talk about how to set up

32:55

some key performance indicators so that

32:57

you perform at the level that you want

33:00

to with your business now

33:03

one big overlying caption with key

33:05

performance indicators is they’re

33:07

dramatically different from business to

33:09

business to business if you’re doing a

33:11

hair salon your key performance

33:13

indicators are going to be greatly

33:14

different than if you’re a plumbing

33:15

company or if you’re a lawn mower or

33:17

whatever the case may be

33:19

so

33:21

we’re going to talk about some of the

33:22

general overlying conditions that you’re

33:24

going to want to monitor with these key

33:26

performance indicators and then i’m

33:27

going to give you some real life stuff

33:29

of what i monitor in my business this is

33:32

yet again another area where when we

33:34

open up the question and answer stuff

33:36

and everything else if you have

33:38

questions for what might be some key

33:40

performance indicators for yours you’ll

33:42

be able to send those in and we may be

33:43

able to help you out yeah and those when

33:45

you start sending those in

33:47

don’t think of this is a stupid question

33:49

because

33:50

there there may be 20 other people that

33:52

have the same question yeah because some

33:54

of these things that we’re talking about

33:55

are in generalities yeah yeah and you

33:57

really need sometimes people need help

33:59

breaking that stuff down and if your

34:01

question is what call this is this is my

34:04

situation what column do i put that in

34:07

in my excel spreadsheet we will tell you

34:09

if we answer that question we’re

34:11

probably going to go into some serious

34:13

depth about okay this is where you need

34:15

to be you know mitch is going to answer

34:17

some of those questions i might answer

34:18

some of those questions

34:20

we are going to give you

34:21

what you need so just

34:23

don’t be afraid to send the question in

34:26

i mean especially at the beginning we’re

34:28

probably going to be able to get to all

34:29

of them yeah you know so just

34:31

write it down if you’re listening to

34:32

this and you’re you have a serious

34:34

question write it down and send it to us

34:36

yeah

34:36

ultimately what gets measured

34:39

usually improves

34:41

and so the purpose of key performance

34:43

indicators is to measure things in your

34:45

business that have the biggest impact on

34:47

your business and have the biggest

34:48

chance to improve your business and it

34:50

makes a visual for you to see you can

34:52

see it yeah so

34:54

um in episode 8 we’re going to be

34:56

talking about um tracking and improving

35:00

and evaluating and everything else

35:02

ultimately that entire episode is built

35:05

off of the key performance indicators

35:07

that we’re going to teach you how to

35:08

track right now so we got to in order to

35:11

prepare properly

35:12

we have to put those key performance

35:14

indicators in place today

35:17

so that we can track all of that

35:20

properly in the future we don’t want to

35:22

be starting the business and then

35:24

figuring out how to track everything yes

35:26

right now you’re going to need numbers

35:28

like you just said you’re going to need

35:29

numbers to fill those sheets out yeah

35:31

but to have have the systems prep done

35:34

in order to do that that’s what we’re

35:36

working on so there’s there’s a couple

35:38

of key areas that you’re going to want

35:40

to track okay you’re going to want to

35:42

track the number of opportunities you

35:44

were given that day to make a sale

35:47

you’re also going to want to track the

35:49

number of sales you made that day

35:52

and then you’re going to want to track

35:54

the value of each sale so that you can

35:57

develop an average sale so what this

36:01

looks like average sale is in made the

36:03

sale and average sale as in i made at

36:06

this average amount of money on that

36:07

sale right so two different things there

36:10

so what this looks like is i had i’m

36:12

just gonna again use round numbers

36:14

i had ten opportunities to make a sale

36:16

today

36:18

i made a sale on eight of those ten so

36:21

that means my conversion rate is eighty

36:23

percent so that means that we converted

36:26

80 of our opportunities into a sale okay

36:30

and then of those opportunities

36:32

basically you take the total revenue for

36:34

the day

36:35

and then you divide it amongst those

36:37

eight sales that you made and and now

36:40

you have an average sale so let’s say we

36:43

made a hundred dollars on each

36:45

opportunity

36:47

so now our average sale is a hundred

36:48

dollars our total revenue is eight

36:50

hundred dollars yes okay so

36:52

you’re going to want to be building a

36:54

spreadsheet in excel or google sheets or

36:57

whatever to where you can develop

37:00

like mine is monthly and then in each

37:02

month i’ve got like a section for each

37:04

week of the month

37:06

and then in each week of the month i’ve

37:08

got a section for each day so each day i

37:11

can go in and track

37:13

okay i had this many opportunities today

37:15

i made this many sales today my sales

37:18

were 100

37:21

dollars and a 150.50. dollars or you

37:22

know whatever the case may be and then

37:24

this this again this is a cool thing

37:26

with excel is you can set it up to where

37:28

it’ll automatically tell you your total

37:30

revenue for the day and you can build

37:32

the formulas to where it will

37:33

automatically tell you your average sale

37:35

for the day

37:36

and then because i’ve got it grouped

37:37

into days and evolving into a week

37:41

as i plug it in for each day

37:43

it will my system will automatically

37:45

tell me okay for the week you’re

37:47

converting at 78

37:50

and your average sale is this amount of

37:52

money and your total revenue is this

37:54

amount of money

37:56

and then

37:57

as that again these sheets are built

37:58

monthly so again i built the sheet so

38:01

it’ll give me like individual week’s

38:03

performance but then at the bottom of

38:04

the sheet it’s also going to give me

38:05

like an ongoing performance for the

38:07

whole month

38:08

you know i may have had a good week and

38:09

a bad week and then at the bottom of the

38:11

sheet it’ll kind of blend it out for me

38:12

and say okay here’s where you are for

38:14

the month for the month you’re

38:15

converting at 80 percent and your

38:17

average sale is 200 a sale

38:20

and so your your gross revenue for the

38:22

month is x yeah and can i say something

38:25

just about that real quick so

38:27

to a lot of guys um like i started out

38:30

mitch and i both start out new

38:31

construction they’re listening to that

38:33

going oh are you freaking kidding me

38:35

yawn bore why why but if you sit down

38:38

and do that it gives you

38:41

uh just the upper hand of knowing

38:44

where that money’s going how am i

38:46

getting that money i shouldn’t say where

38:48

that money’s going but

38:49

where those cards are coming from where

38:51

yeah where is that money coming from how

38:53

can i improve on it and you know a whole

38:56

other point is you can cross-section

38:58

that work too like say you’re a

38:59

lawnmower

39:00

and you go back and look like say the

39:03

previous month is april oh man it rained

39:06

from blah blah blah to blah blah blah

39:08

and my sales calls went up x

39:11

right you know what i mean you could

39:13

always yeah because it’s raining and the

39:14

grass is growing so you’re mowing more

39:15

and this is and this is a business 101

39:18

hey everybody should know this common

39:20

sense stuff but

39:21

you know in other business that

39:23

cross-sectioning may be different you

39:24

could be like oh you know what maybe you

39:26

know for the last two years i’ve seen

39:28

that maybe i should put door hangers up

39:30

the three weeks before that right you

39:32

know what i mean and then and then

39:34

you’re building that platform even

39:36

further because two years later that’s

39:38

four years back hey our sales and our

39:41

calls went up

39:42

this much right by doing that and it

39:45

allows you to really if you want to step

39:47

back and look at the big picture yeah

39:49

you know

39:50

a lot of people say and paralysis by

39:52

analysis

39:54

but sometimes you need those numbers i

39:56

shouldn’t say sometimes you always need

39:58

those numbers to evaluate where you’re

40:01

going where you’ve been how do i get

40:04

there and i think that that is just you

40:06

know that’s another part of key

40:08

performance indicators that can take you

40:10

to

40:11

um you know the next level right you

40:13

know what are those metrics right right

40:15

you know where are you the uh

40:18

um

40:19

there we go

40:20

um

40:22

the other the other thing that i track

40:24

in mind

40:25

is the the biggest thing that i track in

40:27

mind is usually conversion um are you

40:30

talking sales conversion yeah sales

40:31

conversion so the number of

40:32

opportunities i have each day versus the

40:35

number of sales i make

40:37

can like conversion is the most

40:39

important number of all of those right

40:42

uh because

40:44

conversion means a happy customer i

40:47

can’t make a customer i can’t make a

40:49

customer that i didn’t sell anything to

40:50

happy so no they might actually be a

40:53

little disappointed hey i had this guy

40:55

out and i didn’t like his number or you

40:57

know and people are moody

40:59

you know you can’t get them all right

41:01

right so um for me in my business i want

41:05

to convert 80

41:07

of the calls that i go on each day i

41:09

want to convert 80 of those calls to a

41:11

sale

41:12

and um so

41:14

a lot of people say well why wouldn’t

41:15

you want to convert 100 to a sale well i

41:18

need that 80

41:21

in order to tell me that my price is

41:23

correct the price that i’m asking of my

41:25

customers is correct

41:27

if i’m converting 100 of the calls that

41:30

i go on into a sale it means that i’m

41:32

charging too little money for the sales

41:35

yeah okay now if you’re in a

41:38

and your profit margin is going to

41:39

indicate those things too

41:41

so if you’re in a

41:43

low profit margin business i i bring

41:46

this up all the time if you’re in a lawn

41:47

mowing company you need to sell more

41:49

than 80

41:50

of the calls that you go on okay you

41:52

know because you’re making less money

41:53

per call right you know you need more

41:56

volume

41:57

you need to seriously that number’s

41:58

gonna be higher for you right okay and

42:00

now if you’re if you’re in a business

42:02

that say you’re a crane operator and you

42:05

get a call

42:06

that may even though you’re making more

42:08

money that may also need to be

42:10

higher right because you’re go you’re

42:11

taking less of them yeah and those are

42:14

just examples of um how it’s going to be

42:17

different for your company right right

42:20

so

42:21

every everyone’s going to be a little

42:22

bit different and when we get to the q

42:24

and a side of things you may be able to

42:25

kind of call in and or you know email in

42:27

and ask yeah and you know what and

42:29

question when we get to a question and

42:31

answer

42:32

some of those might not be questions

42:33

they may be statements right hey my

42:35

business did you know this

42:38

we get this many calls and my number is

42:40

60

42:41

yeah we want to hear from you yeah yeah

42:43

yeah send that in send that information

42:45

in we’ll you know we don’t have anything

42:47

to give out yet but we might someday

42:49

right you know send that t-shirt or

42:51

something yeah you know send that in and

42:52

say hey

42:53

and and and give a paragraph you know

42:55

it’s just email it’s easy to type it up

42:57

and you don’t have to be a professional

42:59

just you know hey these were my numbers

43:01

this is how i got there right right and

43:03

if it’s interesting and we think that

43:05

it’ll help other people

43:07

we’ll read it and once you understand

43:09

like what is your target number like i

43:11

know my target number is eighty percent

43:12

yeah once i understand what my target

43:14

number is if i’m converting my calls at

43:17

over eighty percent it means my price is

43:19

too low but maybe too low what’s funny

43:22

is if i’m converting my calls at under

43:24

80 percent it does not mean my price is

43:27

too high

43:28

it means that i need to work on my

43:30

salesmanship skills and my presentation

43:33

could it could be either it could be

43:35

either but in your market in and you’ll

43:37

get a good feel for that if you’ve been

43:39

in business for a little bit any time

43:40

your conversion is too low it’s always a

43:42

salesmanship or a presentation problem

43:44

anytime your conversion is too high it

43:46

is typically a pricing problem your

43:48

price is too low so kind of keep that in

43:51

mind

43:52

good salesmanship can always inflate

43:54

conversion and if your conversion gets

43:56

too high well then you need to modify

43:58

your price yeah

43:59

um

44:01

once you’re familiar with these numbers

44:03

you’ll grow to rely on them and you’ll

44:05

use them every day

44:07

to help grow your business

44:09

so we’ve talked about that um for me

44:12

once i had all of these in place

44:15

then

44:16

and once the sh the sheet takes some

44:17

time to build right and it’s gonna it’s

44:19

gonna be specific to you it’s an ongoing

44:21

work yeah once that sheet’s built

44:24

then what’s going to happen is you’re

44:26

going to come home every night and

44:27

you’re going to plug your information

44:28

into that sheet and it’s only going to

44:29

take you a few minutes it takes me like

44:31

five minutes every night to plug all

44:33

that stuff in and that five minutes

44:35

gives me an instant update as to how

44:36

we’re doing today this week and this

44:38

month well and that’s because you did

44:39

the systems prep yeah you have that

44:41

system in place to work for you right

44:44

you’ve already done the work without a

44:46

system like this in place what ends up

44:48

happening is you are running hard every

44:50

day and you don’t know if it’s paying

44:53

off or not

44:54

and so it makes it very difficult if you

44:57

were to run a marathon but you didn’t

44:58

know how long the race was going to be

45:00

be real tough to play that’d be pretty

45:02

tough right you didn’t know when the

45:03

finish line was going to be you didn’t

45:04

know what success looked like in that

45:06

marathon

45:07

you didn’t know is this a sprint do i

45:08

need to be running harder right now or

45:10

can i ease up a little bit and conserve

45:11

energy for later

45:13

and so what those metrics do for me is

45:15

like if we’ve had an awesome month

45:18

it tells me that we’re pacing really

45:20

well so keep driving because this month

45:22

is is making out to be something awesome

45:24

right

45:25

if we’ve had a slower start to the month

45:27

it tells me that i need to make up for

45:29

lost time and kind of get back on track

45:31

yeah um evaluate what’s happened hey

45:33

right you know where do i need to go

45:35

what do we need to do right right so

45:37

those those numbers really help you

45:40

understand how well you’re doing and

45:41

without numbers and metrics to kind of

45:43

base all that off of you’re going to get

45:45

burned out and visualization so if you

45:47

have a program that has a bar graph so

45:49

say you don’t like looking at those

45:51

numbers hit the bar graph yeah yeah

45:53

click pie chart and it will show you you

45:55

know those things hey last month your

45:57

pie chart looked like this right this

46:00

week or this month it’s looking like

46:02

this and you immediately know

46:04

okay we were successful last month and i

46:06

it was like this right

46:08

what do i need to do to to get back to

46:10

that and your quickbooks will actually

46:12

do some of that for you it’ll tell you

46:13

you know how much revenue you’re making

46:15

this month compared to last month and

46:16

everything else your crms will also do

46:18

that for you too so

46:20

i like just using those basics

46:22

opportunities versus sold calls versus

46:25

average tickets those three give me

46:27

everything i need to know to run the

46:29

sales half of the business

46:31

so

46:32

um once you start thinking of your

46:34

business in those terms it’s getting

46:35

your business is getting ready to take

46:36

off uh because now you can start using

46:40

those terms to help you grow otherwise

46:42

so you can say like okay if i want to

46:43

have another truck well then i need

46:44

twice as many opportunities each day i

46:46

need i need the business to prove to me

46:48

we have the opportunities to run another

46:50

truck and that focuses your

46:51

concentration so if you know hey i need

46:54

this many more calls maybe advertising

46:56

is the way to go maybe you know maybe

46:58

say maybe i need to push the guys to

47:00

sell just a touch more right you know

47:02

maybe i need to raise or lower my price

47:05

just a little bit right you know it and

47:07

it helps focus you know your intent yeah

47:10

there’s one other sheet that you’re

47:12

going to want to build and this is

47:14

separate from the the tracking the the

47:16

key performance indicators it’s tracking

47:18

but it’s different it’s tracking but

47:19

it’s different this is a monthly sheet

47:22

where you can plug in each day’s

47:24

performance and we’re talking excel

47:25

sheets yeah okay excel sheets or google

47:28

sheets when you get it and we’ve talked

47:30

about this before when you start asking

47:32

those questions if you need us to break

47:33

down what columns those need to be in

47:35

and how we did it or you know how do you

47:38

how

47:39

do you think we should

47:40

tell you to do that right send those

47:43

questions in yeah so we’ll do it we’ll

47:45

break them down

47:46

what we’ve got in what what i do on my

47:48

monthly sheet and again this is separate

47:50

from my key performance indicator sheet

47:53

my monthly sheet allows me to plug in a

47:55

summary for each day

47:57

and so it’ll tell me this day i ran

47:59

three calls it’ll tell me this day my

48:00

revenue was this

48:02

and then at the bottom of that tracking

48:05

mechanism

48:06

i’ll be able to like put in each daily

48:09

revenue and it will automatically then

48:11

calculate my revenue to date for the

48:13

month

48:14

and then it knows

48:16

so so typically there’s anywhere between

48:18

like 20 and 23 business days in a month

48:21

yeah um

48:22

you know monday through friday is a

48:24

business day saturday and sundays are

48:25

kind of bonus

48:26

um

48:27

so i’ve got my sheet set up to tell me

48:30

okay there’s 21 business days this month

48:34

were 11 days into the month so we’re

48:37

about halfway through it’s going to tell

48:39

me that okay our revenue has been this

48:41

so far

48:42

and if we keep on this pace then our

48:44

projected revenue is going to be this

48:47

and then you can see hey last month

48:49

we’re falling short of last month right

48:51

hey we’re about we got to turn up the

48:52

dial yeah we’re above last month right

48:54

on target the reason this is important

48:57

is because there’s a lot of people that

48:59

start out in business and they assume i

49:01

have to run every call that comes into

49:03

my phone they assume that i have to work

49:06

every saturday and i have to work every

49:08

sunday and every night and every weekend

49:10

and every waking hour of the day

49:12

and that will kill you it will literally

49:16

kill you now there are outliers so

49:19

a heating cooling company

49:22

if you’re a one-man shop you may have to

49:24

work you’re

49:25

you may not have a set schedule you may

49:27

be working saturdays and sundays because

49:29

you’re on call and you’re on your own

49:31

now

49:32

if you want to grow that to get

49:33

employees so that you can break that

49:35

apart

49:36

yeah you know that that’s a separate

49:38

subject but you can literally work

49:40

yourself to death if you allow it to do

49:42

so yeah so here’s where this makes a

49:45

giant difference

49:46

with a good tracking sheet that’s going

49:48

to tell you like okay

49:50

we’re let’s let’s use round numbers

49:52

let’s say it’s a 20-day month

49:56

and we are at day 10

49:58

and we are at 20 000 in revenue so far

50:02

this month

50:04

you okay

50:05

i got something man winter just dry out

50:08

there man so day 10 we’re at 20 000 in

50:11

revenue your sheets going to tell you

50:13

that you’re automatically pacing for a

50:15

forty thousand dollar month

50:17

now based off of your goals and

50:19

everything forty thousand may be low it

50:21

may be high i don’t know let’s say forty

50:23

thousand dollars is high you’re way

50:24

above pace your goal is to make thirty

50:26

thousand dollars in the month and you’re

50:28

making 40. that doesn’t mean slack

50:29

either it does not mean slack however

50:33

it does mean that if you are tired and

50:35

you’ve worked a ton you could spend that

50:37

couple days off right and that phone

50:40

rings

50:40

it tells you that i don’t have to run

50:43

that call in order to be successful this

50:46

month we’re not saying

50:48

get rid of calls but maybe when you

50:50

answer it say i’m gonna need to come out

50:52

tomorrow right or the next day right it

50:55

is very easy to work yourself to death

50:58

when you are new in business especially

51:00

if you’re not tracking so tracking

51:03

allows you to say i’ve afford like i’ve

51:05

worked so hard i’ve afforded a saturday

51:08

off i’m going to go out with the family

51:10

on saturday yeah and and when those

51:12

calls come in you just let them know i

51:14

don’t have any availability today my

51:16

next availability is on monday

51:19

like for us we’re always closed on

51:20

sundays

51:21

so um we don’t work sundays at all no

51:24

matter what the nature of the the

51:26

business is somebody could call in with

51:27

a busted pipe and we’re gonna tell them

51:29

i’m sorry i don’t have any availability

51:31

today i can get out there it’s kind of

51:32

like me i don’t work sunday through

51:34

wednesday

51:35

so you know just david you know if you

51:37

call for sunday to wednesday i’m not

51:39

coming out to your house yeah that’s

51:40

just so um you know my tracking allows

51:43

me to do that right now if we’re behind

51:45

pace and i know that i got to take

51:47

everything that’s going to come in well

51:48

then guess what when that happens

51:51

um i’m going to go through and i’m going

51:54

to say okay we’re behind pace when that

51:55

call comes in on a saturday i don’t have

51:57

a choice i got a sorry family i got to

51:59

go

51:59

i got to go work right and let’s let’s

52:01

talk about that for a second you may

52:03

you may be behind because you haven’t

52:05

got as many calls so maybe you have got

52:07

some rest maybe you have spent a couple

52:09

of you know so

52:11

you know you

52:12

it helps you balance right your life

52:15

versus your work life yeah and there’s

52:17

there’s a couple of different avenues

52:18

you can look at that in like for

52:20

instance if we’ve had a really good

52:22

month let’s say i haven’t worked myself

52:23

to death but sales have just been really

52:25

well i use that as a motivator to keep

52:27

going right yeah because what you’re

52:29

going to understand perspective is yeah

52:32

what you’ll understand in business is

52:33

once your needs are met

52:35

once your costs are met for the month

52:37

every dollar you make after that is

52:39

profit

52:40

so

52:41

my tracking sheets kind of let me know

52:42

when those scales tip from meeting the

52:44

needs to the business to now we’re

52:46

profiting and boy i’ll turn it up and

52:48

i’ll work hard because now we’re into

52:50

pure profit yeah and so i’m just gonna

52:52

keep cranking it’s a natural motivator

52:54

right hey we are just you know what

52:56

we’re doing right now we’re making i

52:58

might be able to take the guys all on

52:59

vacation next year because right now we

53:01

are flat

53:03

we’re killing it right so again none of

53:05

that happens without proper tracking

53:07

um

53:08

there’s there’s been a lot of times

53:09

where i’ve spent time with my family

53:11

because i knew i could you know when i

53:13

started my business we took so when when

53:15

we started the business i took a week

53:16

vacation with our family from the time i

53:18

separated from my employer to the time

53:20

we opened our doors because i didn’t

53:22

know how much time i was going to have

53:23

with my family after that yeah so we

53:24

took a week off we went to colorado we

53:26

hung out for a while and then i came

53:28

back and like hit the ground running and

53:30

started working hard

53:32

within six months of us opening our

53:34

business we took four or five days off

53:36

and we went skiing i knew i could we

53:38

were performing really well we had done

53:40

really well months to month to month and

53:42

and i knew like i can actually take a

53:44

couple of days off and we can go

53:46

we can go you know to spend some time as

53:48

a family i haven’t spent as much time

53:50

with them as i’d like because i was

53:51

working on the business so let’s go put

53:52

in some quality time and that’s

53:55

let’s be clear that’s part of the

53:56

podcast too we’re not trying to tell you

53:59

or grow you into just a machine that

54:01

works no this is about this is about

54:04

family this is about people this is

54:06

about doing the best that you can

54:08

this is this isn’t just about business

54:11

right right this is about about helping

54:14

people be better people also yeah being

54:16

better

54:17

uh family men and women yep

54:20

and i i mean those are good points yeah

54:23

this podcast is to help you be more

54:24

successful in business so that you can

54:26

also be more successful in your personal

54:27

life yeah and and you know a good thing

54:29

i always kind of think about you know a

54:31

lot of people

54:33

um there are a lot of losers out there i

54:35

shouldn’t say a loser i don’t know but a

54:37

lot of people uh live to work right we

54:40

work to live so that you can live your

54:42

best life one we’re gonna we’re gonna

54:45

break here we’re gonna show you guys

54:46

something that that most people don’t

54:47

see we do these podcasts with almost

54:49

virtually no editing so if something

54:50

goofy is happening you’re going to kind

54:52

of hear it marcus if you’ll step outside

54:54

for a second and grab the remote that’s

54:57

on the nightstand

54:59

right outside what are we doing what’s

55:00

happening it’s getting a little warm in

55:02

here and

55:03

one of our cameras is trying to overheat

55:05

oh i don’t care i didn’t pay for that

55:07

camera yeah

55:10

marcus is gonna

55:11

reach through here and hand me a remote

55:14

and we’re gonna get this thing cooling

55:15

off here a little bit i wonder so the

55:18

camera’s heating up i never actually

55:20

noticed but i feel

55:22

i mean i feel like it’s pretty good in

55:24

here

55:24

does it feel cold in here to you

55:28

so here you go marcus now it’ll start

55:30

cooling off a little bit in here and

55:32

keep our cameras from getting damaged

55:33

from getting too hot so

55:35

yeah this is real live podcasting real

55:37

life stuff here we’re adapting as we

55:39

come so now you’re going to want to take

55:40

that remote and set it back on that

55:41

nightstand by the way

55:43

for that to work thank you marcus thank

55:44

you marcus

55:46

okay so um

55:49

um where were we at we were wrapping up

55:52

with how proper prep prepares you for

55:55

great family life as well so yeah

55:56

exactly um

55:58

when you have a deep understanding of

56:00

your financials it gives you the

56:01

opportunity to take some time off and

56:03

enjoy the whole reason why you’re doing

56:04

this right you’re not doing this because

56:06

you love business you’re doing this

56:07

because you love your family and you

56:09

want to create a mechanism that helps

56:10

you spend as much quality time with your

56:12

family as possible so

56:14

um the last thing we’re going to talk

56:16

about here is or family and friends if

56:19

you don’t have family but you like to do

56:21

other things you like to go base jumping

56:23

right you like to take the quads out and

56:25

go down to oklahoma right you know

56:28

that’s just as good right right and you

56:30

should be able to set yourself up in

56:31

order to spend as much time doing that

56:33

as you can yeah so

56:34

last thing we’re going to talk about is

56:36

to stop trashing your fellow tradesmen

56:39

there is a there’s a problem in any

56:42

trades or crafting industry

56:45

where

56:45

people are way too eager to trash and

56:48

bad mouth other people’s work

56:50

other people’s product other people’s

56:53

anything yeah that does not help you in

56:56

business one bit it will not help you in

56:59

the slightest so

57:01

do not ever bad-mouth your competition

57:04

in front of your customers and this is

57:06

about this isn’t just about that and

57:08

this may this topic may seem like it’s a

57:10

big leap but it’s also advertising that

57:13

is a form of advertising yes and

57:16

presenting yourself as a professional

57:18

right right if people want drama they’ll

57:20

go watch all the reality tv shows to

57:22

grab all the drama they want they don’t

57:24

want drama from the tradesmen that’s

57:25

coming into their home to work on their

57:27

home that they’ve worked hard to obtain

57:29

right they don’t want drama from the

57:30

person that’s cutting their hair or

57:31

mowing their lawn or anything like that

57:33

maybe hair cutters well there’s a lot of

57:35

clucking in there they’re going to clock

57:36

and they’re going to gossip a little bit

57:38

but they’re not trash in other salons no

57:40

no no right so

57:42

um

57:43

your customers pick up on this and it

57:45

draws unwanted attention from your

57:47

customers and it makes you look really

57:49

bad um and the reason why is your

57:52

customer is solution oriented they’re

57:54

coming to you because they have a

57:56

problem and if your bad mouth and your

57:58

competition or other people that might

58:00

be bidding on that job you’re not

58:01

putting them any closer to a solution

58:04

so

58:04

they’re they’re focused on a solution

58:06

and you should be too um

58:08

keep in mind like let’s say let’s say

58:11

you’re in the contracting industry

58:13

your customer might be getting three

58:15

bids to do a deck or to do some drywall

58:18

or to do some painting or whatever else

58:20

so your customers considering they’re

58:22

actually considering using

58:24

one of the companies that is coming

58:27

to work for them

58:28

yeah if you bad-mouth that company

58:32

you’re basically bad-mouthing your

58:33

customers opinion

58:34

because they’re considering using one of

58:36

those companies and if you tell them

58:38

that i wouldn’t use them they’re junk

58:40

they produce crappy product well they

58:42

may have been a great option in that

58:44

customer’s mind and so now you just told

58:46

your customer your opinion is drunk yeah

58:48

and let’s say let’s say they had three

58:49

bids right they may you may have

58:52

automatically removed them and yourself

58:54

and they’re going with that third option

58:55

right you may have just put

58:58

you know you may have put them off and

58:59

they’re like oh you know what right

59:01

screw both of them i’m going with this

59:02

other guy and i’m gonna tell you how i

59:04

do it um but i’m gonna i’m gonna like so

59:07

i have done it this way and it just so

59:09

hap there’s actually another guy out

59:10

there uh that has a really good way of

59:13

of describing this we’ll get to that in

59:14

a second but how i do it is i’ll usually

59:17

if i can get access to the other

59:18

companies that are bidding it i’m i’m

59:20

not doing it so that i can understand

59:22

who i’m bidding against i’ll ask do you

59:25

mind telling me what other companies

59:26

you’ve had out here looking at this work

59:28

and they’ll tell me the whole purpose i

59:30

want to know is so that i can praise

59:31

those companies

59:33

i don’t even i don’t even care if they

59:34

do bad work or not but in front of the

59:36

customer i want to tell the customer

59:38

that yeah those companies do pretty good

59:39

work and in our industry um

59:43

if if we don’t hear about a company that

59:44

usually means they do good work and i

59:46

don’t know a whole lot about them and so

59:47

that means they probably do good work if

59:48

they if if they did bad work i’d know it

59:50

yeah okay because it would be everywhere

59:52

i’m gonna tell that to the customer

59:54

because what i’m doing is i’m

59:55

reaffirming to the customer that their

59:57

opinion is of value and the companies

59:59

that they’re looking at are not bad

60:00

companies okay

60:02

what happens is the company the customer

60:05

really appreciates that

60:07

and now they really appreciate me for

60:09

not taking the bait to bad mouth another

60:11

company

60:12

and usually they end up going with us

60:15

for the work not always not always but

60:17

usually they do but that stan even even

60:19

though

60:20

you know it may not help you make a sale

60:23

right that’s stand-up professionalism

60:25

and that’s where you what you need to

60:26

strive to be yeah yeah um andy frasella

60:29

uh he has another podcast uh he’s

60:31

actually kind of had two one was the

60:33

mfceo project and then now he has

60:35

another one called real af

60:37

um i follow his podcast i’ve literally

60:40

watched every single episode of his

60:41

podcast he’s got some really good stuff

60:44

he has a great way of explaining it and

60:47

he uses like the the ford chevy option

60:49

so like let’s say you drive a ford

60:52

and you’re considering switching to a

60:54

chevy and you take your ford truck to

60:57

the chevy dealer

60:58

the wrong way for that chevy dealer to

61:00

approach you is for that salesman to

61:03

walk up to you and say oh man you’re

61:05

driving one of those junky you know ford

61:07

or chevy whatever whatever which way

61:09

this is going oh you’re driving one of

61:11

those junky fords we need to get you

61:12

into a chevy right away yeah well guess

61:14

what that salesman just turned that

61:16

customer off because keep in mind there

61:18

was a time where that guy loved that car

61:20

and you’re now telling him that what he

61:22

loves is junk you are a right so

61:25

the right way to handle that even if the

61:27

guy was to take it well yeah it’s still

61:29

it’s not helping you when you’re trying

61:31

to make sales

61:32

sometimes the littlest thing yeah

61:35

so it hurts you so the right way to say

61:36

that is oh yeah yeah we’ve got a lot of

61:38

people that are switching from boards to

61:39

chevys and ford makes good stuff you

61:40

know um you know chevy’s got some

61:42

different stuff so let’s let’s just

61:44

check it out right yeah you’re not bad

61:45

mouthing the guy let’s compare the two

61:47

and you tell me what you like right you

61:49

know i’ll tell you what what i think we

61:51

do better right right and we’ll sit down

61:54

and hash it out so you you can talk

61:55

about it without badmouthing them yes so

61:57

that’s the key you can bring up bad

62:00

things without bad-mouthing

62:02

a competitor yeah yeah and that’s the

62:04

key to winning that war with your

62:05

competition so

62:07

guys this wraps up a lot of our planning

62:10

steps and we have covered a ton

62:13

of info in this preparation step stuff

62:16

frankly i’m exhausted so just to give

62:19

you guys a realistic timeline

62:22

i did all of these preparation steps in

62:25

six months it took me six months to do

62:28

all of these what we’ve talked about in

62:29

the last six episodes in the last six

62:32

episodes it took me six months to work

62:35

through all of this now

62:37

i did it for the plumbing industry

62:39

and i did it in a way

62:42

that

62:43

allowed me to succeed i had 20 years of

62:46

experience before putting these steps

62:48

together i had 14 years of management

62:51

experience before putting all these

62:53

steps together so based off of that

62:55

experience i was able to do all of the

62:58

preparation steps the personal finance

63:00

prep the business finance prep and then

63:03

the systems prep i was able to do that

63:04

in six months

63:06

just using similar apples to apples

63:09

comparisons if you’ve been a plumber for

63:10

five years and you have never managed

63:14

people

63:15

it may take you longer to do these prep

63:17

steps and that is perfectly fine it may

63:19

take you shorter let’s be honest it

63:21

could take you shorter it could take you

63:22

you might be debt-free you well you may

63:24

so you say you had all that experience

63:26

but we’ve just lined out all the steps

63:29

in order right you started you didn’t

63:31

have it all lined out i had to create

63:32

those learning as you were going yeah it

63:34

means two months right right you know

63:37

what i’m getting at is time doesn’t

63:38

matter

63:39

so don’t get focused on how long it

63:41

might take don’t get frustrated just get

63:43

in there and get it right get it done

63:45

and then just stay end result focused

63:47

once the business is up and going you’re

63:48

going to be a much happier person

63:49

especially if you’ve done it and some

63:51

people are goal-oriented so maybe write

63:53

down those first three and say hey when

63:55

i got that done all right got it done

63:58

right get the next one just take them

63:59

one at a time right and if you’re not

64:01

writing your goals down get to doing it

64:03

write down get personal finances under

64:05

control give yourself a literal box to

64:08

check when that’s done so uh doing that

64:11

helps out dramatically because checking

64:13

that box

64:15

is so powerful yeah um

64:18

you’re soon gonna be in the mindset of

64:20

oh man i’m in a whole different caliber

64:23

that’s great millionaire mindset is that

64:24

millionaire mindset and and you’re going

64:26

to be smiling as you start crossing some

64:28

of this stuff off and if you’ve done

64:30

what we’ve suggested before about kind

64:31

of separating yourself from some of your

64:33

friends that are dragging you down and

64:34

you’re gravitating yourself towards some

64:36

of your more successful friends

64:38

that’s going to help too because you’re

64:39

going to watch those friends start

64:41

cheering you on yeah and if you thought

64:43

that millionaire mindset was you know

64:46

i can’t just click and turn that on but

64:49

how you can get there is like we just

64:51

talked about crossing off those steps

64:53

right so as long as you’re moving

64:55

forward and up

64:57

you’re getting there right just a little

64:59

at a time and you just got to keep

65:01

working at it yeah stay disciplined work

65:03

the processes that we’ve lined out for

65:05

you and you are getting ready to open up

65:08

a wonderful boatload of opportunities

65:11

guys remember as as we’re wrapping up

65:13

this show

65:14

remember that if you like what you’re

65:15

hearing on this show do us a favor and

65:17

help share the void with somebody who

65:18

might be wanting to start their own

65:20

company we saw the opportunity to help

65:22

uh so that’s why we put on this show

65:25

um we would love to watch this show take

65:28

off and and be a good indicator and help

65:30

people out and and yeah be a good

65:31

indicator

65:33

for us not like our ego boost right but

65:35

man if people start sending in hey thank

65:38

you for your help you know i’ve been in

65:40

business six months now right you know

65:42

right

65:43

it’s worth it it’s worth it right right

65:45

or people that have recently started

65:46

their business but maybe they didn’t do

65:48

all of this stuff and now they’re having

65:49

to do it in arrears they’re doing it

65:51

afterwards you can still do it and and

65:53

you’re going to watch the business turn

65:54

around they’re going to watch their

65:56

business go from somewhat stagnant to

65:57

start climbing and yeah and that’s great

65:59

timing steeper even if they were on an

66:01

upward trajectory right right so uh do

66:04

us a favor and help share the show with

66:06

anybody that might need it uh the

66:07

easiest way to do that is kind of on the

66:09

social media platforms that you’re

66:10

already on you know don’t go blast this

66:13

on your own social media because nobody

66:14

nobody follows that stuff um go as you

66:18

see people asking questions about how to

66:20

start their own company or how to

66:21

perform

66:22

improve the performance of their newly

66:23

started company drop a link to an

66:25

episode or drop a link to the show yeah

66:28

uh on there and help

66:30

help us out that way let them follow as

66:32

they as they want so

66:33

um we really appreciate you guys helping

66:36

us get this message in front of

66:37

everybody that needs it so until next

66:39

week guys really appreciate it thanks

66:41

for hanging out with us through all of

66:42

these prep steps it’s a lot of hard work

66:44

but you’ll find out soon that it’s going

66:46

to pay off so

66:47

we will see you next week love you guys

The Void #6 Core Episode Systems and Processes (3 of 3) – Jan 22, 2021

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The Void #6 ** Core Episode ** Systems and Processes (3 of 3) – Jan 22, 2021

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The Void #6 Core Episode Systems and Processes (3 of 3) – Jan 22, 2021