EntreLeadership - Why No Business Is Better Than Bad Business

Episode Date: July 21, 2025

Today, we’ll hear about: Dave Ramsey’s take on why no business is better than bad business A business owner looking for ways to attract quality talent Why you don’t need a business degree to be successful A young man wanting to know how to approach his grandfather about his business ideas 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 📖 Order Dave’s new book, Build a Business You Love: https://ter.li/b4kru2   Connect With Our 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! 📈 Grab ⁠Sales Gravy's⁠ free resource to help you hire and lead better. 📝 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   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 in the trenches right alongside you. I actually make payroll, so I know what it's like. If you have a question and you want to ask on the show, well, just fill out the form at Entreeleadership.com slash ask or call and leave us a voice. voicemail, we'll get you on as a caller. The number's 844-944-1070. That's 844-944-1070. Daniel is in Phoenix. Hi, Daniel. How are you? Excellent. Thank you. I appreciate the call. Sure. What's up? Hey, I'm a landscape contractor with approximately 14 million in revenue, 85 employees, and work has been steady, but each contractor we do business with, asked us to sign a contract that's incredibly biased in their favor. And when I review these contracts,

I go through and redline a lot of things that I don't want to agree to. But lately, our clients are objecting fiercely to these red lines, and we have lost some business as a result. They'd much rather go deal with a subcontractor who will sign their contract without any red lines. What are your redline? There are dozens. What are you taken out? So there's things like pay when get paid language, basically, which is we get paid when and if the owner gets paid by, or when and if the owner pays the contractor. There's also liability. We can't hold the contractor liable for destroying our equipment or injuring personnel, even if they're 100% at fault. There's frequently language in there that prevents that.

That's assigne. I wouldn't sign either one of those things. I agree with you. Yeah, it's crazy. But, hey, listen, bad business is, no business is better than bad business. Yeah. So, good riddance. Yeah.

Because what's going to happen is, you know, here's what's going to happen. The contractor's going to screw up and they're going to put your competitor out of business. Mm-hmm. Not you, because you didn't go over there. Yeah. And that's just your reality. I mean, you have to choose some of these things and some of the risk is not worth the business. I mean, there's two types of clients you walk away from situations like this and then the other one where the client's crazy.

Yeah. They burn too many calories for the dollars they create. No thank you. Yeah. So just walk away from anybody that won't negotiate. Well, anybody that won't negotiate a reasonable situation. But I get, you know, I'm not going to pay you unless I get paid. Oh, crap.

You hired me. Yeah. And, you know, you're not liable for your misbehavior, which, by the way, it doesn't work because you can't contract away liability. Liability is statutory, you know, meaning that it's the law. They're liable whether their contract says they are or not. If they tear up something, I mean, but either way, that's just, you know, you'd ask your attorney about that. I'm not a lawyer, but believe me, that's what he's going to tell you or she's going to tell you. So anyway, that, but that neither here nor there.

The point is, is you've got some people. people that are, they're, you know, kind of bullying their subs. Yes, and it's very common in the industry. It always has been. Any other sub will sign these contracts. Not any, but here's the one thing. I promise you that the things you and I are worried about are going to bite your competitor in the butt. It just takes a little time.

In the meantime, it just feels like lost business, but it's not lost business. What you did was you managed risk. and you've got to do that. I'll give an example in our world. We had a major national retailer that if I named them, everyone would know their name that wanted us to provide, that we were really excited to do a deal with

until we got the terms. And they wanted us to put a, you know, a Ramsey book package together to put on their shelves labeled with their brand on the label. And, you know, brought to you by such and such, okay? And so we would have to go through and print all of this specific to them,

meaning it has no value except on their shelves. You follow on me? It was a $10 million deal, and we were really excited about it because the distribution and the branding and to be associated with the name that big, and all that was a big deal for Ramsey back in the day. And then they came in and said,

but if the stuff doesn't sell, we can return it all to you for a full refund, which means I got $10 million worth of crap in my warehouse. that I have to throw away. Well, I'm not going to bite a bullet because they're $8 an hour stock clerk won't put the stuff on the shelf right. That's their problem.

So, no, I can't do full returns on $10 million. It wouldn't put me out of business, but it'd make me wish I was out of business. You know what I'm saying? Right, right. And so we had to walk away from that deal because we could not negotiate past the full returns risk. They demanded, and they said, the same thing you said. They said, well, all the other vendors we deal with except these terms. And I said, well, see, now you can't say that anymore. Yeah. You can say all but Ramsey,

but, you know, Ramsey's the one unicorn that walked away from such and such that everyone was dying to do business with. And I'm not dying. I don't want to die. It's okay. Thank you. I'm not dying to do business with it. So we had to walk away from that. And our team, you know, we're all looking at each other like, are we crazy? Are we stupid? Or we, well, maybe we should do this. And we're like, no. If those things come rolling back in here on an 18 wheeler, we're screwed, man. We can't do it. And the same thing with you. If they decide they're, you know, the, the owner doesn't pay for you or for a completed job doesn't pay the contractor, so the contractor doesn't have to pay you. And that happens all the time, Daniel. No, thank you. I know. You're liable, dude. You hired me.

That's how this works. And so, you know, you've got to decide what risk you want to take. And it is, there is a pain associated with walking away from bad business, but the pain of doing the bad business is greater than having walked away from it. And it takes a few years for you to look back on that and go, we were really wise. It was really smart. That's how we're still alive because we didn't sign stupid stuff. And the stuff you're describing, I agree with you. This is the Entree podcast. You're the CEO, not the chief marketing officer. Your job is to cast. a vision, lead your team, and drive growth. But when your marketing is inconsistent or last

minute, your customers feel it and it can hurt your brand. Plus, if you're staying up late, writing social posts or planning out your own email campaigns, your business isn't growing. It's grinding. That's why, if you're not ready for a full-time hire, you should contact belay about a marketing assistant. Belay fractional assistants are based in the U.S. and are matched based on your personality, tasks, company culture, and systems. Marketing assistance from Belay are more than support staff, their strategic partners, someone who can write, design, schedule, analyze, and optimize your marketing across multiple channels.

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the ultimate guide to working with a marketing assistant. That's E-N-T-R-E to 55-1-2-3. In a typical small business, you spend more money on payroll than any other expense. It is your largest investment, which means you need to get an ROI on. your investment, a return on investment. And that's where Entree Leadership Elite can help. Elite is the online platform that aligns your team so that you can scale your business. You're going to get

these tools that will help you integrate your whole team and get everybody on the same page. Our proven trainings will help you become the kind of leader people want to follow. Plus, elites community of business owners will have your back even when things get tough. My leaders use Elite every week to unify our 1100 team members here at Rams. solutions. And now you can use Elite to align your team too. To grow your business with Elite, go to Entreeleadership.com slash Elite or just click the link in the description if you're listening on YouTube or on the podcast. Tyler is in New Hampshire. Hey, Tyler, how are you? I'm doing fantastic. Dave, thanks for taking my call. Sure, man. What's up?

So I'm a small electrical contractor. Um, 20203, we did 160 in revenue. Uh, 2024. I did $1.1.1 million. with four guys, but I had to fire two of them. So I guess my question is, how do I find qualified electricians that are licensed that don't drink on the job or do drugs or any other nefarious activities? Yeah. Well, as you're discovering, hiring qualified people with high character is hard because there's not as many of those as there is dupuses. Yeah, quite a bit.

Yeah. There's a high percentage of duphuses in the population and a small percentage of winners. And so what you and I are always looking for is we're looking for the winners. We're looking for the thoroughbreds, not the donkeys. You can't win the Kentucky Derby with a donkey, and you were right to fire these guys. And you could find electricians that are licensed. The issue is they don't fit my culture. Like I work until the job is done.

The customer satisfaction is my number one priority. But getting people that have that same vision. They exist. They're just more rare. than the other kind. And they do exist in every field, including electricians. We work with electricians all over America on trade leadership, and they are able to put together a quality culture with quality people.

But Tyler, what you're experiencing is a standard frustration. It is very hard. You are looking for the top, you know, 10 to 20 percent of human beings walking around out there with an electrician's license. And they're harder to find than the donkeys. There's more donkeys than thoroughbreds, man. That's why we watch the Kentucky Derby. Yeah, so would you maybe slow down the growth?

Because the goal for this year was about $2.6 million, but I can't do that with just me and a guy, obviously. So we're going to obviously cut back a little bit until we take the time to find those good guys. If you have to, if you have to. I would grow slower rather than grow fast and have to do it over and over again. Because as you have discovered, doing it over and over again is kind of a frustrating experience. and so but but i i i want you to change your language you've kind of got this impossibility thing out there like these are unicorns like they don't really exist they do exist there is just fewer of them

and they are harder to find here's the great news once you've established and you've got you know four or five or six thoroughbreds on your team that are high character people that care deeply about the outcome and they know how to wire a fuse box without blowing something up and they have their license, you know, once you've got a few of these, they will let the other ones know because they know who the other ones are. Thoroughbreds run around with thoroughbreds, donkeys run around with donkeys. That's who, in their personal lives. And when they're on a job, they can look over at the competitor. They know who's over there. And you'll attract them just because you'll become known as the place to go work where you don't have to put up with,

you know, drug use. And you don't have to put up. with misbehavior on the job and lack of character in the human beings. And you'll become known as the guy that that's where they want to work. Let me give you an example of that. You ever been to a Chick-fil-A? Yes. You know what kind of teenagers are at Chick-fil-A? Not sure.

Thoroughbreds. The best thoroughbreds on the planet. You know why they all want to go work at Chick-fil-A? Because Chick-fil-A is a reputation of having thoroughbred teenagers in there. And so moms and dads can let their teenagers go work there and learn something about hard work and learn something about customer service without fear that the senior managers doing cocaine in the back. Right? Yeah.

And so it's become a cultural, it's become very attractive, but it's almost as if it's a part of their brand now. Yeah. It's a great culture they have going. But would you only compete up price being such a small company? I can't offer, you know, health benefits. We offer 401K with no match, but... What you can offer is treating people right, and everybody else pisses on them.

Makes sense. And I have never overpaid intentionally to hire someone in just my own price. And a few times that I got close to doing that, it didn't work out because they were here for their own reasons. You want people to join this team because they want to be treated like family,

they want to be treated with dignity, They want to be working for a guy who has a backbone, who gets his work done and has a love for the people that work there. He takes care of them, takes care of their family. Something happens. Somebody needs something. You reach over and take care of. Family businesses are the best thing to work for on the planet instead of corporate America because corporate America pisses on people. And so it's the best place to work.

And so for years, we've used that as our hiring brand differentiator that we've used. you know, this is a great place to work. It's a culture where people behave. It's a culture where we care deeply about the outcome. And if you want to misbehave and you want to do all these other, you know, horrible behavior things that people do in the workplace normally, you're not going to fit in around here because we're going to hit the eject button on your butt. And so you're not going to be here.

We don't do that. You don't get to be a we if you're doing that. And so we've developed this reputation as being an excellent place to work. And we pay good wages. We pay market rate wages. But if somebody comes along and starts jacking wages up next door, then people want to go over there for that. Then they need to go over there.

Because I'm not jacking wages up to keep people or to attract people above market. We pay a fair wage for a fair day's work, and we have one of the best places to work in America. And we're very proud of that. And you can develop that exact kind of thing in the world of construction in the world of an electrician, but it is harder because you're looking for the top 10, maybe 20% of human beings walking around that have an electrician's license. The other 70 or 80% aren't worth screwing with. They're problems. And you've already experienced that. So it has,

at times over the 30 years, been very frustrating for us here at Ramsey. And I will tell you, coaching 10,000 plus businesses across America, it's probably the number one pain point that people have is how to get the donkeys out of the building, how to get the thoroughbreds in the building. And it's a constant, a constant pain point for those of us that run businesses and actually care about our team and actually care about our brand

and actually care about our culture. It is harder to do this, but in the long run, it's easier because you get to come to work with people that you actually freaking like instead of going, man, I have to take a shower every time. come and have a meeting with that guy.

It's gross, you know, and people feel that way. They feel slimed because they're slime in the room. You just have to, you know, you have to deal with this. It's just so hard, Tyler, I know. And it is frustrating. I'm just, but you can do this. And you need to do it the right way because you're going to have a better life if you do it the right way. That's the direction I would go.

It's the direction I have gone. It's the direction we've taught for 25 years for small businesses to do. Hey, most of you didn't start out in sales. So when it comes to hiring and training a great sales team, well, maybe that's not your rodeo. That's why you need sales gravy. Sales gravy gives small businesses the same premium training that Fortune 500 companies get without the Fortune 500 price. Sales gravy was founded in 2006 by 16-time best-selling author and thought leader, Jeb Blunt.

And now they're a globally recognized leader in sales training solutions. Their team training hub has over 1,500 hours of live and on-demand content for every customer-facing role, from sales to account management to customer success. Plus, you get an easy-to-understand dashboard to track progress so you know what's working and who's winning. And if you've ever struggled to create commission plans that motivate your people without blowing up your budget, sales gravy has your back there too. They just released a free resource that shows you how to build comp plans, to motivate the right behavior without overpaying,

and how to reward things that actually matter, like retention, profitability, and teamwork. Download the free guide today at salesgravey.com slash entree. It's called the Small Business Owners Guide to Sales Incentives and Compensation. And it's free at salesgravey.com slash entree. Question of the day from Bill in Nevada. My wife and I own a martial arts studio, and while we've maintained steady revenue over the past few years,

I know there's room for growth. Neither of us went to college or come from business backgrounds, so I've been managing our business finances like personal ones. And I realize that's holding us back. What do you recommend for someone like me to build a solid understanding of the business side? I've been thinking about going back to school for a business degree, but would appreciate your guidance.

You don't need a business degree. and you know you may want to take an accounting class at the local community college that wouldn't hurt anything to begin to understand accounting especially if they have one designed a course designed for entrepreneurs for small business people the second thing you can do is you need to hire a i don't know who's keeping your books now but you probably need to hire an outside contracted bookkeeper. And part of their job is not just to keep your books. Part of their job is to teach you.

And if they're a little more expensive than someone else who just keeps the books, that's fine. But part of their job is to help you build out a good, solid accounting system. And that may even be a CPA. And you can go to Ramsey Solutions.com, and you can find those kinds of folks in our ELPs, our tax-endorsed local providers. They're people that do taxes locally, but a lot of them also do books and do books for small businesses.

So ask one of them, could we hire you to do our books and teach us how to build out an accounting system? And you can find someone to do that, and that's probably the best route to get that basic system in place to do that and to manage that. And if it's a CPA that's got some long-term business experience, they probably, can give you some really good just general financial advice, especially if they come off the Ramsey website, because they're going to be anti-debt, pro-cash flow, you know, pro-retained earnings, which is the phrase we use for the emergency fund for the small business or the line of credit for the small business is self-funded, whatever we want to call this. And so, now that's the route to go. But if you want to take a class on it, I'd do that.

No, you don't need a business degree. That's not necessary. Very few small business owners have a business degree. Very few. Most of them are, they start out being the technician, the heat and air guy that knows how to fix a heat and air, the martial arts guy who knows how to do karate. They, you know, they start out being the tech, you know,

the chef that knows how to cook. And then they end up, oh, wait a minute, I'm now in a business. And I was talking to a friend of mine that's a, in our world, in the podcast world, and the other day, and he's like, I thought I was just doing a podcast. Turns out I'm in business. Can you help me with that? And I went, yeah, now that you got big, I mean, you get a little scale to it.

All of a sudden, it's a big deal. It's no longer in your living room, dude. And so, yeah, that's exactly what you're going to do. So it's an accidental business owner, accidental entrepreneur, when you're just doing your thing and it takes off. And that's kind of what you guys are doing. That's the normal track. It's not go to a business school and get a degree.

And then you're going to go out and start reading books. And here's the trick. John Maxwell says that one of the 21 irrefutable laws of leadership is the law of the lid. The problem with my business is the guy in my mirror. The solution to my business is the guy in my mirror, which means you have to engage in a continuous stream of personal growth, which means you're very wise for, asking this question and asking it the way you asked it. How can I grow because I'm the problem at my

business? That was your question, and it's a great question. It means you're very self-aware. It means you got your hands on what's going on. And so, you know, what you need to do is just, you know, you never need to stop reading. I've got two books on my desk right now that are business books that I'm reading and leadership books. And one's a biography, and one of them is, just an incredible book on entrepreneurship. So anyway, yeah, all way, and I'm 30 years into this, dude. So, you know, if I can do it, you can do it. So jump in there, start reading, reading, reading, learning, learning, learning. And if you want to go take a class, go take a class. But I would not spend the money or the time on the degree. That would not be my suggestion. Does leading your team

feel like hurting cats, even if your business is winning financially, a misaligned team, will create new fires for you to put out every single week. But with Entre Leadership Elite, you'll align your team and hold them accountable so you can stop hurting cats and start scaling your business. To join Elite, go to Entreeleadership.com slash Elite or just click the link in the description if you're listening on YouTube or on podcast. Thanks for hanging out with us, America. We're glad you're here.

If you want to be on the show, you can call us and leave us a note at 8449. 14-4-1070. And we'll get back with you and the team. We'll get you set up to be one of the callers here and we'll try to help you move your business along. We love small business people here. You are the backbone. We are the backbone of the American economy.

We are proof that the free enterprise system still works. And we hire more people and create more of the gross domestic product than all of corporate America put together. And corporate America struts around acting like it's doing. something and you and me are the freaking economy boys and girls so we're glad you're here you deserve to win and we want to help you 844-9-4-1070 if you want to help us out with the show we would appreciate it you can consider following click the old follow button the subscribe button leave one of those nice five-star reviews mama said if you ain't got nothing nice to say don't say nothing at all

and so don't do that and hey share it tell people about it share it with a friend. Tell people you're listening to this show. And we'll try to help you out. It's what we do. Scott's here in Cincinnati. Hey, Scott, how are you? Hey, Dave, I'm good. How are you? Better than I deserve. How can I help? Yeah, so I'm the senior technician of my family's residential HVAC company. We have about six employees, and last year we did $1.2 million in top line revenue. My question is, how can I best honor my family while respectfully suggesting change? How old are you? I'm 27.

How long have you worked there? I'm in my 10th year. Okay. How long ago did your dad and mom start this? So my grandpa was, he's the current owner. He was the first technician ever hired by the original owner. So the company started in 1980. He bought the business in 2005, so he's owned it for 20 years.

And my mom has worked with him for the last. Okay, so your dad's not there? No. Okay. All right. And, okay, all right. Well, I think the first thing you have to do, and I think you're probably doing this,

but I'm going to outline it for all the people listening anyway that are asking the same question you're asking. The first thing you have to do is you have to be like the best senior technician on the freaking planet. You've got to be so good at your job and so good at leading the people, in other words, doing the job that is your job, that it earns you the right to speak up. If you're at 90%, you've got no right to speak up.

You've got to be at 120%. Okay? Because you're overcoming the fact that your grandfather remembers the time you were walking around and pooped in your diaper. Right. He still looks at you and sees that. He can't keep it because that's human nature, right? You follow me?

Yeah. And so, you know, you are a very accomplished 27-year-old young man, but it is very hard for your grandpa to see you that way, because that's just human nature. And the way you can overcome that, and for him to start to see you in another light, is you perform at such a high level that his pride in your work is about to bust his buttons.

His chest is sticking out. That's first. Lay that foundation. to think you're already there or close, but I'd be real careful about that, okay? Sure. Because sometimes Gen 2, or in your case, Gen 3, is walking around, you know, running at a pretty good pace, and they got a bunch of ideas, and they've really not earned the right by being excellent to speak up.

So that's step one. Step 2 is begin all conversations, and you did this already, Scott, so you're ahead of the game, begin all conversations with honor. Honoring your mom, the 20 years there, honoring your grandfather being the first technician there, building this out. I mean, what we're saying here mathematically is he was a HVAC technician

before you were gleaming in your daddy's eye. Right. You see what I'm saying? So, you know, he just, you were there first. I mean, he was there first. So he's the goat. He's the original. And you've got to honor that.

You got to honor that and honor that. And Grandpa, I just, I respect what you've done, what you've pulled off here. Staying in business for 45 years is an anomaly. This guy's a stud. Your grandpa is incredible. And you need to talk about him to him and about him. that way all the time. The number of companies that have gone out of business since 1980 in heat and air is a bunch,

like most of them. Yeah. You know? Very few companies are as old as you all are in that space. So honor, honor, honor, honor. This guy's the goat. So be careful before you come up to Peyton Manning or Tom Brady and tell them how to throw a football. Right, right.

That's what we're doing here. Okay. So, and if you approach it from those two positions, and then you say, I want your help telling me, this is what I think I'm seeing, what am I missing? Okay. And I think if we did this, it might work, but I'm afraid that I'm the 27-year-old and you're the goat, and I don't know what's going on. Grandpa, tell me what, is this a good idea?

If it's not, teach me what's wrong with it so that I can be you someday. and nobody hates that conversation. Right. Because it's laced in honor and it's a question rather than you running around going, I'm so much smarter than everyone because I know how to use the internet. Right. You know, that's just bull crap. All right.

And so nobody wants that. So it's the opposite of arrogance. There's a humility to it, but it's not a, we're not being manipulative. You're just being truthful. The truth is your grandpa's a stud. and it'd be smart to ask him some questions about business. He probably teaches some stuff. And a good way to do that's going,

I think I'm seeing this, and you've missed, you've avoided a bunch of bad decisions, Grandpa, and you've made some really good ones because you've innovated and changed as you've gone along here for 45 years. So what I'm seeing this, it feels like we could do this. What am I missing? What is there, should we try that?

And if not, teach me why. Yeah. And, you know, he may look at you and go, you know, that's a deadgum good idea. Let's try it. Yeah. You may be on to something, or he may, but that enables him to hear it. Because if you come in with just a tinge of, I've got all my crap together and you just don't know what's going on, he's going to look at you and go, man, I got socks older than you. Yeah, yeah. And the whole thing's going to shut down.

And rightly so. And so that's, we have watched a lot of family businesses navigate a lot of stuff, and especially the Generation 1, if Gen 2 and Gen 3 will approach conversations and approach change and approach questions with great honor by paying honor, it just goes a long way. It goes a long way. Very few people hate being honored if it's not, As long as it's not manipulative.

I mean, and you legitimately respect your grandpa, I'm sure. Yeah. I mean, because it sounds like he's worthy of respect and honor to me. Yeah. A guy that runs some 45 years I'm impressed with. Yeah. Crap, I've only been doing this 34 years. So, yeah.

You know, that's a different thing. So it's, you know, wow, pretty cool. But I'm sure you do have something to add to the equation. You just ask me how to add it, and that's what I'm. I was teaching. I wasn't, I wasn't questioning the validity of your ideas. You heard that, right? Yes, yes, I did. Yeah, and I appreciate what you had to say. Yeah, very cool. Great question, sir. I love that question. It's very, very well done. Good stuff. Hey, folks, wow, that's some good callers today. Remember, better away warrior than a quivering credit. This world needs more high-quality leaders,

so take courage and lead. I'm Dave Ramsey, your host. Thanks for listening to the Ontario Leadership Podcast.