EntreLeadership - I Want to Fire Her, but Then My Business Would Be Screwed

Episode Date: February 24, 2025

Today we’ll hear about:  A business owner whose employee has sole access to the company’s accounts  A man who left his business behind for his new wife in another state  Dave Ramsey��s take on profit in a business  A young business owner considering leaving his full-time job for a profitable side hustle Next Steps  📞 Have a question for the show? Call 844-944-1070 or send us a message: https://ter.li/ask-us.  📚 Learn about the EntreLeadership System: https://ter.li/system-p.  💻 Get EntreLeadership Elite for your business: https://ter.li/elite-p.  ✉️ Sign up to receive tactical tools, advice and resources in your inbox every week: https://ter.li/enl.  🏢 Attend EntreLeadership Summit: https://ter.li/summit.  🎤 Attend EntreLeadership Master Series: https://ter.li/masterseries.  📖 Preorder Dave’s new book, Build A Business You Love: https://ter.li/4zfr52   Offers From Today's Sponsors  💼 Go to Belay Solutions or text ENTRE to 55123 for their free resource!  💻 Visit NetSuite today to learn more.  🧾 Visit Payority for a free consultation!  📝 Use code ENTRE15 to get 15% off your first year of Trainual.    Listen to More From Ramsey Network  🪑 Front Row Seat with Ken Coleman  🎙️ The Ramsey Show   💸 The Ramsey Show Highlights  🧠 The Dr. John Delony Show  🍸 Smart Money Happy Hour  💡 The Rachel Cruze Show  💰 George Kamel    Learn More About Your Ad Choices   Ramsey Solutions Privacy Policy  Learn more about your ad choices. Visit megaphone.fm/adchoices

From the headquarters of Ramsey Solutions, this is the Entree Leadership Podcast, where I take calls from leaders like you about what it takes to win at any stage of business and leadership. I'm Dave Ramsey, your host with over 30 years of experience leading right in the trenches and ditches right alongside you. If you want someone who has theories, you're in the wrong place. I'm an actual pragmatist. I do this stuff every day. I'm the CEO of Ramsey Solutions today. If you want to submit a question, go to the website at Entree. Leadership.com slash ask or leave a voicemail at 844-944-1070. That's 844-9-4-1070. Thanks for joining us,

America. We're so glad you're here. Emery is in Tampa, Florida. Hi, Emery. How are you? Good, Dave. How are you? Better than I deserve. What's up? I'm in the home services industry. I'm the CFO. We have 200 people in 50 million, $50 million in revenue. My question is, how can we transition our controller out of her role, given her 20 years of managing all the cash and her deep process-level knowledge of the business? I joined a year ago, and our Spector tenure, I've communicated that to her. However, over that year, she's been unwilling or unable to transition from the cash accounting to accrual accounting.

and we've been forced to build our business processes around her. Recently, in the past three months, we've started to raise the bar of what we're needing out of this role. She's become bitter and tensions are pretty high right now. She does retain control of the bank accounts, the account logins, the business processes, and she's been reluctant to share that information. In the future, we plan to design the role to reduce relying on just one person,

but we need a smooth transition to avoid a major business disruption. Okay. Well, I think you and I can both agree that this was set up poorly, that you should never have a single person that has exclusive access. I mean, God, if she got hit in a car wreck, y'all be screwed. I think so. I know so. You said passwords, signatures on the accounts, account access, right?

we've moved over a couple of those pieces. But I mean, if she has, if you said she's the sole holder of some of them, right? Of one of the bank accounts, yes, some we've moved away. And she can no longer sold the signer. She's not sider anymore, thankfully. But still too much sits in her sole control. What? One bank account?

The primary bank account, access to it, definitely the process level knowledge of these vendors send us this cash. we apply to these accounts. With the exception of the CEO's been with the company for a long period of time, she's the only one who really knows and runs that process. Okay. We can figure those processes out if she walked out the door tomorrow or got hit by a car. We cannot deal with the bank account access being a solo person in a $50 million company

for even 24 hours. That is just not okay. Yes, sir. It has nothing to do with the fact she's not working out. if she was the dream team member, no one needs to have soul access. Because it's too much risk for you guys. Again, the proverbial milk truck catches her.

You're screwed. So it's just, you've set this up from a financial standpoint, and you'll understand this, and you already do. That's why you're calling. But there's no diversification here, so there's no safety. You need some redundancy in these systems. And that's just good, that's just good systems and processes that you guys have got to install.

So the fact that she's being a butt or being hard to work with has just highlighted what was already horrible. Okay? Correct. So if I'm you, I'm going to get the CEO and I'm going to sit down with her tomorrow and say for the next hour we're going to sit down here and we're going to make a transition to where, in addition to you having the password and the access to this account,

the CEO and the CFO also have the password and the access to this account. We're not leaving this room until that happens. Okay. It's too much risk. It's crazy. Absolutely. And there's six vendors that I'm concerned about, and I need to know what those processes are, and I need to know what that is before you leave this room.

And it's not because I'm mad at you. It's because we've realized that it's too scary for one single person to be the only person that has this information. If something happened to you, it would shut down our business and that's not okay. And then we can, as a sidebar, we can deal with her attitude and whether or not she gets to stay.

But those are separate issues. I'm not getting rid of her because of that. You guys caused that. You know, I'm not going to get rid of her because she has sole access. But I would get rid of her for being a butt. You know, I would get rid of her for not transitioning and not being willing to move to accrual from cash.

That's what we in the downsets of a company we're doing. If you want to be a we, that's what you've got to do. You can't, you don't, you don't run your own country here. You're not the president. You know, you're the controller. So we made a decision we're moving to accrual. I hope you like it. If you don't, then you probably need to go somewhere where they do cash.

That's a different discussion. And we made a decision we don't work with people who are bitter and angry. And so you need to leave that at the door because we don't do that here. So if you can't do those two things, then you can't stay. But that's a separate issue. Those are her fault. The fact that she, She is the sole controller of all of this, and the Queen B is because somebody gave her those keys.

And that was dumb. That's on us for setting up that process incorrectly way back at the beginning 20 years ago. Exactly. You weren't there, but the CEO or the owner or whatever. And it just turned into a monster, and this is how bureaucrats are made. Right? Yes. Yep.

And so, hey, man, I think you already were owned to something and you're doing that. But what I would do from an emotional standpoint is I want to separate the mistakes that the original leadership team made from the mistakes that she's making. Would you call those out in the same conversation or would you get the one big rock taken care of? No. The first thing is to say, you know, I would bring her in the morning tomorrow with the CEO and you in the room. And I am literally not moving the room. We're going to get the bank on the phone and we're going to start sending emails back and forth with the bank. And we're going to do DocuSign and we're putting some other signatures.

and developing some other passwords for the stinking account right now. And the way I would handle that conversation is I would say, okay, you have been fabulous for 20 years up to this point, but as we have looked at this, we have made a huge mistake by having one single person in charge of something because if something were to happen to you, we'd be messed up. And I'm so sorry we made that mistake, and it's going to cause us some discomfort here for the next couple of hours

because we're going to rectify that mistake before lunch. And clarifying it's not, this is not on you. You did not do this. Yeah, I would apologize. I'd say, I'm sorry for this awkwardness. It's not your fault. You didn't cause it. She didn't steal this and capture it and keep anybody from it and hold it secret.

She probably protected it like any good bureaucrat would. But then once I get all that stuff moved, now you're not held hostage to firing her. Yes. That's absolutely how I've been feeling. Yep. Yeah. And you can't be blackmailed. your own mind. She hasn't done that, but in your own mind, you're like, God, if I get rid of her,

I'm screwed. So you don't write up on a holiday, do both things if you got a holiday or a vacation in front of you. Let's take care of our problem first. Then it allows us to be a little bit more gentle and grace-filled and give it a couple of weeks to start dealing with the attitude and the cash basis and the bitterness and all that kind of stuff. And, you know, and what I would do is try to explain to her why accrual is a superior system in the way our business operates and the size our business is. By the way, at $50 million, the IRS requires it. You don't have a choice. Right. It's the only way you can, you have to do accrual accounting. If you want to run a cash flow, cash basis hybrid accounting system you can, but you have to do your taxes based on accrual.

To me, it's been amazing that you're obviously a very successful business. The father and son have built it up. It's incredible that they got this far on the cash basis. It's a much-needed transition. Oh, I personally love cash basis because we're not ever confused about where the money is. But accrual has its advantages and is a more sophisticated methodology. You have to get your head around how it works as a primitive entrepreneur like those guys and me in order to get that. I resisted it, too. But we have been on accrual for 20 years, and so I have worked. learn to read it better, but also it has huge advantages on inventory issues and other things. So all of that to say, I would explain to her why we're doing it. A, the IRS requires accrual

accounting. B, here's how it works to our benefit to have these reports done this way, and accrual spits those reports out that way on our KPIs and on our other things. So this is why we're moving to accrual. It's not to punish somebody. And so I'm going to help you learn it. If you want to learn it. You've been here 20 years. I want to honor that. If you don't want to learn it and you want to leave, well, let's talk about a severance plan. You've earned it. You're a wonderful person. I'm not mad at you. But we're doing accrual. We're no longer doing cash bases. And we're also going to be happy about it. So, but I would separate the two, and then I would separate the two conversations by at least two weeks. But 24 hours from today, by lunch.

I will have passwords and multiple accesses to bank accounts and multiple people understanding vendor allocations and what bucket that money goes in and how we put it in the chart of accounts and whatever it is that she has the singular set of knowledge on. And never again build a system that has a singular set of knowledge. Never. If there's only one person knows how to turn on the lights and they leave, it's going to be dark. It's a problem. So, yeah, that's just, oh, man.

And you feel, you feel like you're held hostage. It's good, really good question, Emery. Thank you for calling in and participating with us. We appreciate it. This is the Entree Leadership Podcast. Well, my friend John Maxwell said, Leadership Ability is the lid that determines a person's level of effectiveness. In other words, if you want to increase your impact as a leader and scale your business,

you have to grow. You have to grow your ability. your intellect, your emotional capacity in order to lead your team to a new place that none of you have ever been to before, which is why you should join us at Entree Leadership Summit this spring. John Maxwell is one of our headline speakers, and he along with myself and 10 other leadership experts like the one and only Jim Collins, like Jefferson Fisher, like a bunch of others. It's going to be John Deloney will be there with me. You're going to be refueled and refreshed with new vision.

you're going to be equipped with some new strategies. I sit in the audience and take notes at this conference because this is the conference I would go to even if I didn't own it. So mark your calendar for May 18 through 21. Get your tickets to join me, John Maxwell, and almost 3,000 business leaders like you at Summit in Denver. Go to Entreeleadership.com slash summit to reserve your seats.

Or if you're listening on YouTube or podcast, just click the link in the... show notes. Daniel is with us and Daniel's in Houston, Texas. Hi, Daniel, how are you? Hey, Dave, I'm doing great. How are you? Better than I deserve. What's up? So I am a residential division leader for an electrical contractor in Houston, Texas, and our revenue is about $1.6 million, and we have eight employees for my division. I'm unsure of the total numbers for the whole company. There's also a commercial service and a commercial new construction and a medical arm of the electrical contracting company. And I also own a residential and commercial

electrical contracting business in Tennessee that is about 700,000 in revenue and about, and we have five employees, including myself. That's a separate company. You work for one company. Completely You own the other one? Yes, sir. Sounds like you moved to Houston to take a job and had a business and left it behind. That's what it sounds like. I met my wife online, and she's a great job as a patrolman engineer in Houston for a big oil company. And she had no interest in moving to Tennessee.

and so I moved to Texas and thought I could run my business in Tennessee. I plan on running my business in Tennessee and getting it to the point where it doesn't need me as much, but that is proving a lot harder than I originally thought it was going to be. And so I found a great company in Houston that could support me while I try to reinvest all the kind of profit from my Tennessee business back into the business. since I'm not there, and it's not as efficient as it used to be, by taking this job in Houston. But now, of course, this job in Houston is taken away from the time that I can dedicate to my Tennessee business. So I'm in between a rock and a hard place, trying to figure out, do I give up my wife's great salary as a petroleum engineer for an oil company and my salary and opportunity potential here and go back to move us to Tennessee and focus on my, business that, you know, got me, got me off the ground and made my first money? Or do I continue

limping it like I have been and get better systems in place and kind of run it from afar while I take this opportunity in Houston and run with it? That's where I'm really stuck and looking for some advice from somebody a lot more experienced than me. When I'm looking at that kind of a thing, one way to... that helps me with my decision-making paradigm is to reverse engineer it. And so let's do that. Let's pretend that you lived in Houston, Texas, and had the job that you have, and you're married to this beautiful woman who makes a lot of money as a petroleum engineer.

And you did not own an electrical contracting firm in Tennessee. Under what circumstances would you go open one in Tennessee? None? None. So sell it. I don't know how to really sell something that doesn't really, I mean, it's, it's been running without me for the past. Does it make a profit? Yes.

Sell it to a competitor. Okay. How many trucks have you got? Two. All right. So you've trucks and tools. Two in a service vehicle. You have trucks and tools, service contracts, and some profit associated with those

someone would like to absorb that. Unfortunately, I don't have any contracts. Okay, so you do residential service or brand new installs? No brand new installs. We do residential service, remodels, service calls, and we put a lot of leads out there, and we're trying to get more in a commercial service, but currently commercial service is only about 5% of our company. Yeah.

I mean, I live in that market, and you and I know that there's 75 other companies doing what you do. Yeah. So if I were in your shoes, I'd sell it. And just focus on, because I want to be an entrepreneur, but I can't be an entrepreneur and really dedicate my all to my Tennessee business. You can't be an entrepreneur in Tennessee because you're married to a woman that lives in Houston. Yeah, and we just had our first, our newborn. That was a big reason I had to hurry up to my butt here.

Daniel, Daniel, you're in Houston. So whatever you do, you're going to do it in Houston. Yeah. For now. I mean, someday y'all may move, but right now, for the next five years, you're in Houston. Yeah. You're not in Tennessee. And so if I woke up in your shoes, I think you're going to have this tremendous,

I mean, you don't have to get a lot of money, but whatever money you get from this, just put it in the bank and, you know, think about, start doing some side hustles that are not in competition with your existing employer. and or you all build up a big pile of cash and you quit that employer and start your own gig in Houston or load the truck or load the trucks and the tools up and bring them to Houston and quit now

and start now in Houston. That's what I considered. But I would not continue to run something in Tennessee that is a part of your past. It's like you're trying to go swimming with an anchor tide around your ankle. Yeah, yeah. It's no fun.

No, no, it's not. And it doesn't, and it's not working well. You're not good at it. It's a very difficult, because nobody would be. It's not that you're inept. You're fine. But I think you're a new dad, new husband, and you got a good job. And if you just sat in that for 18 or 24 months, it wouldn't be the end of the world.

That's what I would think about. So good question, man. Good question. And congratulations. It sounds like you're doing a good analysis on this. But if I woke up in your shoes, I'd be done with that within three months. I'd find me a competitor that give me something for the trucks and for the accounts and the lead generation and the relationships I've got, let them pay me something for all that.

If they won't pay me enough, I'll load up the trucks and bring them to Houston and start thinking about opening something down there. But you don't need to be running something in Tennessee when you live in Texas because it's left over from your former life. Sometimes, folks, that's how they end up with a rental property too out there for the rest of you're listening. You know, I have a rental house in Cincinnati. And I live in Des Moines. Why?

Oh, I used to live there, and I couldn't sell it. So you became a landlord by default, not by strategy. And that's the same exact thing here. So sunk cost analysis is, if you hadn't done it, would you do it now? And if the answer is no, then undo it. Get rid of it. Sell the stupid rental house in Cincinnati. In this case, sell the electrical service contract in Tennessee.

So cool, very cool stuff. This is the entree. Leadership Podcast. In the Andrely leadership system, there are five stages of business. You start with treadmill operator, where too much of the business relies on you. You are stuck on the treadmill. And then once you learn some delegations, some time management, you do some hiring and some budgeting, you move from there to Pathfinder.

And that's where you start laying out clear direction, mission statements, core values, role clarity. And from there, you move to Trailblazer, which is where you start putting the leadership layers in place to carry your business to scale. And then you move from there to peak performer. And that's, of course, where your business gets to be comfortable and you're making a lot of money and your challenges there is to break it before it's broken. That makes a lot of sense. And then, of course, you move to the final stage, which is the legacy builder. And that's developing a succession plan and figuring out what endgame is for the person who was owning it and running it all along, that kind of a thing. As you're going through those five stages of business,

several times you're going to go around the wheel of the six drivers of business. The first driver is the personal driver. You're the problem, you're also the solution. So like we said earlier about John Maxwell, you're the lid on your business. As you're you're, grow, your business can grow until you grow as a person. You're not going to grow your business. Your purpose is the business has to be bigger than simply money. What's the purpose of this business? What's the nobility that we bring to the community? People, which is building a unified team, getting the right people on the bus, right people on the right seats on the bus, you know, constantly dealing with the issues that people represent that are positive and negative.

so a lot of energy goes into the people driver. The plan driver, which is having an intentional plan, some strategic thought, a desired future. We teach you how to do all of that. And then once you've got your plan, you develop the product, and you deliver excellence in the product. And then, of course, we hit profit. That's number six.

profit is so paradoxical in the small business owner's mind. Almost everyone who starts a small business starts it, of course, with profit in mind. I want to make some money. In some cases, I say, I want to make a lot of money, and neither one's wrong. And then you develop all of these things, your personal skills, your purpose, your people, put the right people in place, the right plan in place, develop a product that the customer wants, and go out, there in the rough and tumble world that is called business, this is hard. It's scratch and claw and fight.

And then you finally start making some money. And then you start making some good money. And you start being what people call successful. And the paradox is that our culture teaches us to go win, to go be successful. But if you're becoming wealthy, you must have done something wrong. Well, let me assure you you did not do something wrong. I don't care what some communist professor who's never made payroll says. You didn't do anything wrong. Making a profit is not evil. Making a profit is not wrong.

As a matter of fact, making a profit is an indication that you have served your customer well. People do not give companies money that screw them over and over and over again. Now, they may once or twice, but they don't send their friends, and they don't tell everybody positive things on social media. I just had the best meal at this restaurant. I just got my car fixed by an amazing guy who didn't cheat me. The heating and air guy came to my house. He was here 15 minutes and fixed something that I've been fretting about for two days.

And now we're warm again because he did his job. Thank you. You serve someone. You get money. That's how it works in America. That's how the free enterprise system works. and if you serve more people, you get more money. So I had this left-wing nut job reporter doing a hit piece on us,

and I was sitting with her in her little New York coffee shop trying to be nice, which was a mistake, I should have just ghosted her and let her do whatever she was going to do because she's going to do it anyway because she's a freaking lefty. So, but she's one of these socialists, right? and she's like, well, you know, you're taking advantage of poor people. I'm like, hell you say, I'm not taking advantage of poor people. I'm helping poor people.

You think it's wrong to make a profit if someone is served? And she said, yeah, that's bad. And I went, what's your favorite restaurant in New York? And she told me. And I said, so do you want them to go out of business? No. I said, well, you go in there and eat their food and give them money, and you give them more money than the freaking food costs, and that's called a profit.

This is how capitalism works. They apparently didn't teach you this in your journalism class. And she's like, oh, I understand they need to make a profit, and I don't have a problem with them making a profit. And I said, okay, why? Because I got good food, and I willingly paid that price for that good food. And I said, see? So what if that guy opened another restaurant just like that one, another city. Now he's making twice as much money. Oh, oh wait, he opens 10 of them in 10 different

cities. And now there's 10 times as many people that are happy like you. And 10 times as much profit to him. At what point did he become evil? See, this is the problem with socialism. You eventually run out of other people's money. Margaret Thatcher said that. You can't do this. So I refuse to be shamed for my success, and I refuse to let you be shamed for your success because you're serving someone. My wife, Sharon, and I went to a fine dining experience not long ago. It was rather expensive.

That's one of my favorite sports, fine dining and good wine, right? And we go in, we sit down, this guy comes to the table, white tablecloth, and he's unbelievably helpful. He's pleasant. He's not pushy. He wasn't in our face bothering us. but the water glass never got half empty, nor did the wine glass. The food was not crammed down our face to get a table turn.

It was a luxurious, calm experience, but we also were not lacking in anything to eat. They kept bringing us stuff just as we were finishing the other course. Isn't that interesting? Like a fine dining experience should be. Food was high quality. It was presented on the plate well. The recommendations, I asked him about something. He said, oh, no, don't do that one, do this one.

Instead, I took his advice, it was a good recommendation. It was a fabulous night. You know what he got? A big, juicy tip. Why? Because he served us. That's what you do when you run a business. You fix someone's car because you run a car repair place.

You are serving, just like that world-class waiter in that world. class restaurant. When you fix someone's heating and air, you are serving. When I write a book on how to get out of debt and you get out of debt and you bill wealth and you paid me a whole $20? Ooh, you got served. We took care of you. When you listen to this show for free, I think you got a bargain. Even if it's bad, you came out. So, I mean, seriously, serve. As long as you're serving, as long as people find themselves in a better condition as having come across you than they did before they came across you, you deserve your profit. And that means you have designed your product in such a way that your product or service serves. So if I, if I sell an item in the

Ramsey store that is not bringing people more joy than its cost, then guess what? It doesn't sell. and we end up pulling it and getting a different product that does bring joy, that does help, that does serve. And so that's where profit comes from. Daniel Rabbi Lappin, who wrote the book, Thou Shall Prosper, says that when you do a good job in business, your customer gives you certificates of appreciation with president's faces on them. You have not done something wrong when you serve.

Ken Blanchard said, profit is the applause your customer gives you. You ever been in a stadium with a really good football team that's on fire and they score a touchdown? The entire place stands up and applauds that 18-year-old who just ran a ball across a line. You were entertained and you gave applause. And you paid $200 for the seats. Hello, this is how this works, boys and girls. So when you serve someone, they give you applause. When you serve a lot of people, the stadium full of people is giving you applause.

And now you become what we call wealthy, what we call successful, and you earned it. One of the sayings, one of our core values on the walls here at Ramsey is if you help enough people, you don't have to worry about money. people will beat down your doors to hand you money if you are loving them well, if you're taking care of them, if their life is better because they came in contact with you. That's how you design a profitable product. That's how you design a profitable business. You don't sit around and go, how can I extract money from someone's bone marrow? You say, how can I make their life better? How can I be the waiter at the fine dining restaurant where my level of excellence makes

you, you know, makes you proud to give me a huge tip. I just want to throw money at you because you've done so much wonderful things for me. Isn't that interesting? Also shows up even in something like a non-profit. Like, I know churches who their budget is completely awash with money. They have money coming in. The generosity of the people that go to that church is unbelievable. You know, what else I find at the exact same church?

That those people who are unbelievably generous have had their life changed and transformed by the power of Jesus Christ at that church. That church is bringing life change to them. And the natural result is gratitude. The natural result is generosity to that church. That church has no budget problems because it has a habit of regularly transforming people's lives

with the power of Christ. Oh, there you go. That's how this works. Same thing's true in your heating and air or your car repair business or your chiropractor business or your dental or veterinarian or whatever it is you're doing out there, whether it's a good or a service. If I can sell you a book called The Total Money Makeover, and I've sold 12 million of them, and I can sell you that book for $30, and it teaches you how to get out of debt and become a millionaire, and then you do it and you become a millionaire, I think $30. was called a bargain.

And it works, and a lot of people did it. So guess what? That's why I sold 12 million of them. It was word of mouth. People said, go get the book. It changed people's lives. I didn't steal money from poor people. I helped poor people not be poor anymore,

and they told everyone about it, and they gladly bought the book. Oh, you know what else they do? They buy 10 of them and give them away. There are a lot of people in America that buy cases of total money makeover and keep them in their study. And every time they run into a young couple getting started, they hand them one. Every time they run into a friend that's got a problem with money, they hand them one.

They didn't do that because I took advantage of them. They did that because I helped them transform their lives. Now, I'll go ahead and tell you that the royalty on a total money makeover book is somewhere around $3.45. cents. It's what I get paid by the publisher. Times 10 million. It means I made $34 million. Ripping poor people off. No, that's not how it works, boys and girls. See, the natural flow is that we helped a lot of people and we don't have to worry about money. If you help enough people, you don't have to worry about money. You get out of debt, you do your budgeting, do your accounting, you're wise on what you pay for a product,

price it with a margin, a profit margin, you manage that stuff, you watch what's going on, you look at your costs, and you make sure that you're charging enough to stay open so you can continue to feed that poor socialist who needs a meal, who still doesn't understand that the restaurant that she loves is not doing harm because she went to the wrong stinking college instead of the college of the real world out here with the rest of us live. So that's how this works.

And so I want to encourage you. If you're making a lot of money, that tells me you're helping a lot of people. Very few people make a lot of money screwing people. Very few. Because word gets out. You screw somebody, you mess up their car, you overcharge them working on their car.

They're going to tell everybody not to go to your place. And pretty soon, word's going to be out. on you and there's going to be a stink on your brand. And that's the kind of stuff you're facing. And you should. I hope you go out of business. If your food is cold at the restaurant and it's slow and your service is horrible and I get food poisoning every third time I go there, I hope you go out of business.

I hope you fail for your lack of service. That's what the wonderful free enterprise system does. It puts crooks and incompetence out of business regularly. And so this is where profit comes from, boys and girls. It comes from nobility. It comes from being kind and compassionate. It comes from loving your customers so much that you take, make sure their life is better because they met you and they will give you a profit. That is the natural byproduct.

But if you go looking just for profit, you're not going to find it. Go looking for an opportunity to add value, looking for an opportunity to serve, an opportunity to cause people's lives to be better. And then profit will find you. That's where profit comes from. That's how this whole entree leadership thing works. This is the Entree Leadership Podcast. Thanks for joining us on the Entree Leadership podcast. If you would like to help us out, we would appreciate the help. You can do that by following the show, subscribing to the show. Leave a nice five-star review. If you don't like what you're hearing, don't listen anymore. But don't say nasty stuff. stuff on the internet. It makes you look dumb. Leave a nice five-star review. And share the show.

Take a cut of the clip here and send it out, cut the link out and send it to somebody, or some of the platforms have a share button. Use it. We appreciate the help. If you guys don't spread the word, the word is not going to get spread, and you've been spreading it because our numbers are way up. Thank you very much. Isaac's in Sacramento, California. Hi, Isaac. How are you? Good, Dave. Thanks for taking my call. Sure. What's up? So I have a question. I own a small residential construction company in the Sacramento area. Last year was our first year in business. It was more of a side hustle. We did about 70,000 in gross sales with about 10,000 in gross profit. This year we're going to do about 300,000 in gross sales with 70,000 in gross profit. And next year, we have a little over $3 million in signed contracts with a projected $350,000 in gross profit. How the crap did you grow from 300K to 3 million in one year?

Clients, clients, I mean, honestly, just bigger jobs. Word got out that you weren't ripping people off, huh? Word got out that we're reliable. Yeah, you do what you said on the time frame that you said, and you can't beat them off with a stick. Right. Good for you. It's piling up.

The question I have is this is my side job. I work a full-time salary position. remotely for a, I'm a project manager for a company. You made 70 on 300. Are you going to make 700 on 3 million? No, so that's kind of where I'm playing with the numbers. We're going to make about 350 on the 3 million. What do you make at your day job?

Make 110, roughly. Sounds like a waste of time. There's a few factors that are kind of playing in that's having me a little scared. So number one, we have a newborn baby, their first baby. So just the security is kind of scaring me a little bit. Number two, we lose our health insurance. And number three, my wife doesn't work. She's a full-time mom and student that we're cash flowing her education.

So just kind of scared to make the leap and really the question. 150 divided into 350 is two and a half years. In next year, you're going to make what you would make in two and a half years. at your other job. You can buy health insurance with that. Right. Easy. You can feed a little baby with that.

Easy. The only risk is if the next year you make 70. Right. Oh, wait a minute. You made two and a half years. So the next year, if you make 70, it's now going to take you three and a half years to get back to even. You're going to get so far ahead next.

year that if you like took two years off, you'd still be ahead. Does that make sense? Yeah, yeah, it does. Why do you not believe that, okay, if in 2025 you make $3 million net, or gross, and you net $350, so you run about a 10, 11% margin? Why do you not believe that the following year in 2026 you will do at least that well? Well, the contracts I have for the job starting this year, this next year for the $3 million, I've been working with these clients for a year in the planning stages.

Are you not working with clients now to fill up back when those are done? Exactly. We don't have anything for 2026. And that's what it takes about a year. You'll get something in the pipeline, man. Where'd you get these customers? Referrals from architects. I only market to architects and designers.

Then you need to be working architects and go, where's my referrals for 20, Okay. You can't just work on the projects and not keep the pipeline full. Part of your job as a business owner is fill the back of the pipeline as you finish these other projects, you've got new ones to replace them. It's not just executing the project. It's keeping the pipeline full. That's the marketing. Okay.

Yeah. I think the whole thing is growing so fast. It's scary and you don't feel like it's sustainable. You don't have confidence in yourself to sustain it. And that's part of it. the other thing is, like I said, it's mostly been a side hustle to pay off our debt. If you make 350K, it's officially not a side hustle. It doesn't matter where it came from.

But all that matters is whether you believe in the future. And I list the guy I'm talking to, I don't know how you could screw this up. Unless you just don't keep the pipeline full. But if you'll go fill up the pipeline, I think you'll have at least $3 million the next year, don't you? Hopefully. Yeah. Not hopefully. I think you can do it.

You've proven you can do it. Unless these contracts were just a fluke, and it was a one-time thing, and there's never, people like that don't exist anymore. You got the only ones and you're done. That's just not true, right? Right. There's other people just like them in 2026 that need your help. Maybe it's $4 million.

Right. So health insurance is bull crap. Go buy some health insurance. You're making $250,000 more. Of course you can afford health insurance for a quarter million dollars. And little babies can eat on a quarter million dollars more better than they can eat on a quarter million dollars less. So new baby doesn't cause it.

You're making more money. If you're making less money, those would be valid concerns. If you said, I'm making $150, and when I go full-time, I'm only going to make $100. Okay, now we can talk about I got a baby and health insurance, and that makes me nervous. But you can't talk about that when you're making two and a half times more, right? Right. No, you're right.

You're a stud, man. Act like it. Oh, thank you. You got this. You can do it. You can do it, man. Go into the game and knock something over. You can do this.

You are better than you feel like you are. And you know how I know that? $3 million worth of people bet on Isaac. I don't even know you, but I know people don't give Dufus's $3 million. not much anyway. And so, you know, you're obviously doing a lot right. There's a lot to be proud of here. A lot.

Can you do some things better? Yeah, I'm glad you're listening to this podcast. I'm glad you're engaged in Entree leadership. We'll help you do better. But, man, you're a stud. You got this. You're killing it. I'm so proud of you.

Well done, sir. Quit your stinking job and go to work and be a business guy, man. You're that guy. Get her done. man you are you are on fire so proud of you remember better a wary warrior than a quivering critic this world needs more high-quality leaders so take courage and lead i'm dave ramsay your host thanks for listening to the entree leadership podcast