The Home Service Expert Podcast - How the Right Operational Procedures Can Make Employees Embrace Accountability

Episode Date: July 12, 2019

Greg Crabtree is the CEO of Crabtree, Rowe & Berger. He served as a board member of Quickparts and a global board member of Entrepreneurs Organization (EO). Alongside working with the EO, he is also involved in community service, and has had experience as a council member for the Boys and Girls Club of America In this episode, we talked about Financial Management, Entrepreneurship, Business Accounting...

And you can talk about fuzzy things like culture and better hiring. And yes, all those things matter. But really, at the end of the day, I've really got to have a complete process that really connects what we do and an accountability structure that people actually are drawn to not run away from. And the vast majority of people run away from accountability. This is the Home Service Expert podcast with Tommy Mello. Let's talk about bringing in some more money for your home service business. Welcome to the Home Service Expert, where each week, Tommy chats with world-class entrepreneurs and experts in various fields, like marketing, sales, hiring, and leadership, to find out

what's really behind their success in business. Now, your host, the home service millionaire, Tommy Mello. Welcome back to the Home Service Expert. My name is Tommy Mello, and today I have Greg Crabtree. He's in financial management, entrepreneurship, and business accounting. He's the CEO of Crabtree, Rowe, and Berger. Been doing that since 1986. He's a board member of QuickParts and a global board member of Entrepreneurs Organization, which is EO. Very familiar with that.

And he's involved in community service. He's been a council member for the Boys and Girls Club of America national area. And Greg, I'm really happy to have you on today. It sounds like you've been doing this longer than me, especially in the consulting space. Yeah, it took me a while to kind of get the focus and decide how we could deliver this, but certainly it's been an interesting path to get there. A couple of things on the background there. You mentioned being a board member of QuickParts. That company actually had a successful exit in 2010. So that was kind of interesting that I was not only a consultant to that business,

but helped them through their, from formation to the exit. So a great, great story in their remark. And then global board member of the organization. I was on the global board from 06 to 09, still an active member. And the most recent thing I do for them is I chair executive ed program at Horton Business School that we call EO at Horton, connecting operations and finance. Nice. That's awesome. Yeah, that's great. We don't necessarily have a lot of people that go public, but one of the companies that I work pretty close with is Direct Energy, who owns Benjamin Franklin, who's a punctual plumber. They own One Hour Air, and then they own Mr. Sparking. It's a franchise. It's super successful. And the guys that actually formed that were really amazing. But it's the largest home service company in super successful. And the guys that actually formed that were really amazing. But it's the largest home service company in the world.

And it's owned by a European electric company. Yeah. And actually, one of our clients is a Mr. Sparky franchise. And so we've worked with them and applied our principles to help them understand how to maximize profitability, how to scale, how to grow their team. And so it's a very, very powerful franchise. Yeah, I'm looking forward to sharing these things. So you've been doing this a long time and you learned that it's not necessarily all about accounting because sometimes for a guy like me and most business owners, well, guy like me and most business owners, well, I won't say most business owners, a lot of us don't actually love it. I've got an MBA and I had to take a lot of accounting and finance, but it wasn't my passion to go over balance statements

and cash flow statements and income statements. But tell me a little bit about how you got started in this stuff. You told me you learned those three steps earlier? Yeah. I mean, really, for me, it was really kind of probably the turning point in my career. And it started actually, essentially, you mentioned QuickParts. So the guy who founded QuickParts, Ron Hollis, he founded that company in Huntsville, Alabama, moved his business corporate office to Atlanta for a little better acquisition of talent at the time. And about a year into it, Ron calls me up and says, hey, I run across this group called the Entrepreneurs Organization, and you ought to come check it out. And so I go to Atlanta, go to one meeting, sign up on the spot. Essentially, Entrepreneurs Organization is a peer-to-peer business network. But what's

interesting is there's no solicitation allowed. Matter of fact, when you meet with your forum, which is a subset of your chapter, there's nine other people in my forum I meet with every month for four hours. I'm precluded by forum rules for doing business with them. And so I took the advantage of that and used that group to be my focus group. Because they were the perfect profile of who I wanted as a client. And essentially, they gave the accounting profession a zero on the net promoter score because none of them would actually recommend their current accountant. It's not that they hated them.

They just didn't really feel like they were a necessary evil. They just didn't do what they needed. What really fleshed out of that became the core of what we do today is, you know, they said, first and foremost, we don't want the April 15th tax day surprise. And for many of your listeners, it's actually worse than that. It's an October 15th tax day surprise that they get told. And so we believe in ongoing tax management of telling you quarter to quarter, hey, of the profit that you made, here's how much tax you're going to owe eventually. Let's set that aside and don't use the IRS's money. They're not a good lender.

Secondly, they said, well, what else? And they said, well, we don't like being billed by the hour. And so, matter of fact, I don't actually like paying anybody by the hour for services either. And so, essentially, it had us develop a fixed price mindset. So everything we do in the firm now is fixed price except for outsourced bookkeeping because I can't control the scope of that. I'm essentially renting you a skill set per hour. But everything else in the firm is fixed price. And so what we learned in that concept that we teach to all of our clients who potentially bill hourly is, if you bill by the hour, there's only two possibilities. You gave away my expertise or I charged for my ignorance.

That's the only possibility. And so, hey, you really need to think about value. And especially in the home services industry, you've got to look at that from a standpoint. What is the value that the customer is willing to pay for this level of service? And then I've got a hard target then to make my costs fit into that value. And so it really forces you to think clearly about the cost-benefit relationship of that. And then the last piece, though, was the damning indictment of the accounting profession in my mind. They said, oh, by the way, you see hundreds of businesses, most intimate details, you got to have some idea of what works and what doesn't.

And they were absolutely right. Here as a profession, we're seeing the most intimate details of our clients' data on a frequent basis. And yet we're thinking we're doing financial statements and tax returns when I have the most sensitive data that a Federal Reserve economist would kill for. I mean, because those guys are flying blind. I mean, I believe that we live in a very private company-dominant GDP economy now, that the private companies are more dominant than the public. And the government economists have no insight into that data. I mean, they won't get tax returns for 2018 until at least somewhere around September or October. And they haven't even begun to study them.

I've been studying 2018 economic data every month since January of 2018. And so, and because of our practice, we're kind of a unique practice in that 85% of what we do is not in the city that we base out of in Huntsville, Alabama. So 85% of our clients are spread all over the US, Canada, some international. And so our consultants, we get a pulse of the economy across a broad range of industries every month when we're talking to clients. And I will tell

you, this is still a very vibrant economy and there's been a lot of profit made by businesses. And I will tell you that 90% of what the business media says is not correct based on the data that we see. I mean, I got enough to do. I mean, I don't want to take up the platform of broadcasting,

but it's one of the common things we have to help our clients understand that don't listen to the media about what's going on in the economy, because that's not really truthful. Yeah, it seems like they're just going after old flushed out, it's not flushed out data. So it's taking some time to get through. Well, it's old thinking. I mean, you know, 10 years ago, public companies probably still were at least 50% of the GDP source, but I think it's probably closer to 30% or less now. There's not been any significant companies go public in the last eight or ten years just because of the heaviness of regulations and Sarbanes-Oxley and all those kind of things. There's an extremely vibrant private equity market, especially, I mean, you look at, you know,

home services, there's a lot of private equity money chasing, you know, large franchisees in the home services industry, because the term I have for home services, I call them the necessaries. I mean, you know, this is the stuff that's always going to be there. AI isn't going to replace the come mow your grass for a long, long time. I got news for you. I mean, they might think that they can put a robot out there to mow your grass, but it still takes humans right now. And, you know, the same thing for electrical work and same thing for HVAC and same thing for pest control and same thing for alarm services and you name it. I mean, so it really is one of those fascinating things

that if you were going to start a business today, some type of home services is probably the easiest place to launch into because it's always needed and there's always a bad competitor that's doing a poor job doing it. Yeah, I agree. I will say though, over the next five to ten years it's not a computer going to take

over but the computer just like what it did to the taxi service is going to tell you i've got a broken garage door spring and it's going to make it up instead of these platforms like facebook amazon google and they're all very close right now amazon home services just came back out this last year and they're going to know this last year. And they're going to know exactly the customer satisfaction rate. They're going to know how long you take to do the job and who's the closest one because time is the biggest resource right now. It's becoming a commodity. So as far as giving a customer exceptional service and charging for it, that is, I don't want to say it's going away, but it will start to fade here over

the next 10 years. And I think over the next three specifically. So I will tell you, I take a different viewpoint than that. And the reason being is kind of being on the ground with somebody saying, so one, Amazon says a lot of great things. I'm not so convinced that they know what they're talking about. There's going to be eventually a backlash against Amazon, largely because of how they work. We actually work with a lot of Amazon resellers and people that don't exclusively sell through Amazon. We've actually had several of them stop

selling through Amazon because they were actually losing money through that channel. Yes, 5%. Yeah. They still spend there, yeah. Yeah, so we've actually seen a movement of people move away. We've actually got a client we just recently worked with that they only sold their Amazon. And even they've indicated that Amazon has started to soften

some of their kind of predatory practices of pricing and domination of the market. And so to a certain degree, what really is happening is this understanding of sloppy business used to think that they made a margin off of the things that they sold and some off of the services. And what you've seen in the economy is a segregation of, there's a minimal margin on the thing that ultimately gets sold through the various channels of distribution through that process. And the opportunity is to correctly value the service that's being delivered. Now, if you want to be successful in that, you've got to have your messaging correct, you've got to have your people buttoned up, and they've got to be able to deliver it. So like our Mr. Sparky franchise, one of the things that they've done exceptionally well is started to create self-training and develop their own field techs. And to be quite honest, I mean, one of the things that they've been able to do is put people through a regimented training process that ultimately makes those guys better than 50% of the workforce the moment they hit the field. And that's a powerful concept. Because here's

the thing. We live in a labor-starved economy. We're not going to see anything change anytime soon for that. So if you're not developing your own talent, if you're not defining the brand standards that you want to live to, hold people accountable to those brand standards, and make sure they can deliver them when you're at 100% volume, you're not going to be the winner. But if you can deliver those three things, you will win. I don't care who else is out there because Amazon can't do that. Amazon's horrible at physical direct service and never will be good at it because you got to be reasonably close to the people that you're managing to deliver that type of service level that the vast majority of the economy really

expects and demands. And I agree with that. I just think, you know, you would think that Uber wouldn't be so successful for the fact that the technology, you know, Uber and... So let me ask you this. Let me just push back. Is Uber successful? Well, the fact is their valuation of a tech company of, last time I mean, they just push back. Is Uber successful? Well, the fact is their valuation of a tech company of, last time I checked, they were around $40 billion. But the fact is that... They've never made a profit. Well, yeah, but either is Amazon, apparently.

You know, all these, not Amazon. Amazon has made a profit. They did $5 billion, but they didn't invest. They don't pay taxes. But most of these tech companies they're in such fast growth mode their valuation is far more it's not in their best interest to make a profit because they're going to have an exit strategy well where is uber going to exit so google loans google loans you know they get consumed by these bigger tax advantage, right? Here's the thing, though. Physics applies

to us all. And there's a physics to finance. And so one of the things, I'm working on my next book right now. And in my original book, I hypothesized that businesses need to be 10% was the new break even, 15% was great profitability. But that only applied to about 70% of the business models out there, that there was always some that had to be a different number. And so, as I continue to research the data, I really found the 100% correct connection between how do you set your profit target, and essentially, it's based on your turn on invested capital. And so based on the capital input that a business requires tells you how much profit you've got to run out of that business. Because if it fails to return on investment, it will eventually implode. And I don't care if you're Uber or anybody else. I mean, Amazon had to eventually start making a profit. So did Facebook. I mean, when you look at it. Yeah, but look at how they chose to make a profit and how that may turn back against them.

And so Amazon is feeling this revolt from their resellers because the resellers actually can't survive based on the fees that Amazon retail is charging. And so now granted, Amazon has this backstop called AWS that their web servers, that they actually make an obscene amount of profit on. And so, to a certain degree, I mean, these are the laws of the big. And so, none of us listening to this call is going to create the next Amazon more than likely. I mean, if they do, then hats off to them. But those are Amazons and the

Googles and the Apples and the Macrosauce or once-in-a-generation kind of companies. The vast majority of us live in the real world, and we have to live with these things. But there's a basic level of physics that applies to all of those businesses. There's a certain amount of capital input that you need to have to make whatever business you choose. You have to have a minimum 50% return to make that viable. So we talk about EBITDA all the time. And we talk about, you're not in business, you know, the biggest misconception that a lot of times the guests on the podcast hear me say is, a lot of times you'll meet a landscaper or a gutter guy, and they'll say, yeah,

my business made $150,000 last year. And I go, okay, what did you make? I go, I told you 150,000. And I said, no, no, no. That's what I got to pay you to do your job and run the business. So if you sell the business, I'm paying 80 to a hundred grand to get your replacement. So your business actually made 50. And what I'm curious to know from you, and I know it varies, and it depends if you're B2B or B2C, because B2B is, in my opinion, it's not the place to be when I got to go for a builder that wants to pay me in 188 days. And if the plumber messes up, I don't get paid for the garage door. But that's just, it's survival of the cheapest when you're working with builders. But in your opinion, based on the average home

service business, do you think that 15 to 20% is realistic on a profit margin? Yes. But here's the way I would tell you to specifically know it. So it goes back to, as I said, so think of it like this. One of the things that we've not done a good job of in business is teach the understanding of capital formation. So everybody starts one of these businesses. You typically start, you take $2 bills and start rubbing together to get a third and a fourth. And really, it's like you said, the typical business starts with maybe a little bit of life savings to get going. And you start doing the work and you're making less than a market wage,

you got sweat equity, you got a little bit of cash. And then as soon as you start making a profit, you leave that profit in there to start rolling out and getting faster and faster. But here's really the scientific way of looking at it. Essentially, there's four types of capital that every startup and every existing business has to deal with. The first one is I call trade capital. So that's essentially accounts receivable plus inventory minus accounts payable, vendor support, and minus deferred revenue. And so this was the big ahas because trade capital is slightly different than what you learned in accounting class about working capital. Trade capital is a subset of working capital, and all I've done is extract the cash component out of it and extract the line of credit component. Because it's really that trade capital signature that tells you whether or not you can scale a business rapidly. And what we're finding is,

especially in a home services environment, if I get paid upon service delivery, I am lowering the capital requirement then of what cash I got to put in and fund the business. If I get support from my vendors, that gives me 30 to 60-day terms for supplies or inventory or whatever I carry, then that also helps as well. And then the best of all services are the ones that I have deferred revenue where I get the bill in advance. And so essentially, if I sell a maintenance agreement,

say to an HVAC customer that they pay me at January of every year, and one, I got two things. I hope that it doesn't break. And two, I get paid before I go out. And so those are ways that you can create... John Mullins wrote a great book called The Customer-Funded Business. And so essentially, it's the ability of companies to break the traditional curves of carrying receivables or getting the customer to pay them in advance when the market allows for

that. If the market doesn't allow for that, then I just got to make a higher level of profit to justify it. So that trade capital is the first piece. Second piece is infrastructure capital, which is essentially the amount of money net of debt that I have in equipment or buildings. So in most home services, generally, you would look at a truck as a common economic unit and electrical, HVAC, those kind of things. And so I got to buy a truck and outfit it. But the bank allows me to finance a portion of that. So it's really just my down payment. It's my capital requirement there. And the note payment itself, from a functional accounting standpoint, is just an operating expense in reality. By the time the accountants finish with grossing it up for fixed assets and fractionalizing the note payment between principal and interest and you take depreciation, the net of all of those entries is exactly the same as just expensing the note payment.

And you take that over usually five years? It's a slightly different accounting period. Yeah, yeah. Well, generally what you don't, you just don't want to finance it beyond the true useful life of the asset. So if I'm going to wear that truck out every two years, I only want a two-year note.

If I can run the truck five years, then I'm okay with a five-year note. But the key is you got to match the financing to the true useful life of the underlying asset. So I've talked about trade capital. I've talked about infrastructure capital. The third piece is what I call buffer capital, or in my book, I called it core capital target. So that's your two months of operating expenses in cash with zero drawn on the line of credit. Now, when you first launch your business, that's the one that you're going to be underfunded on most of the time. But the idea is you still got to leave your money and leave your profits in the business until you get to that number, I believe.

So that's the three primary capital components. And then the fourth one is I call it the magic pixie dust of business growth. And we call that launch capital. So launch capital is, in the beginning of a business, it's the operating losses that I have to fund until I break even. So that's pretty easy for people to understand. In an ongoing business, it's discretionary choice spins that I can choose to do, but nobody's forcing me to do it. So typically, spending money on marketing campaigns to advance the business, not just maintain what we currently have, or to add a key employee

before they're fully usable in the business process, and I'm growing into that person. And so those are things that we monitor. We isolate that from the ongoing part of the business. And what we want to do is make those bets appropriately that that catalytic span to grow. I need a 50% return on that and increase in net profit within 12 to 24 months or else it wasn't a good bet. In this next book, I'll be able to really lay out this process of how you fundamentally grow. Now, I can't make the bet for you. That's your job. That's what you got to make the bet on. But I can certainly teach you how to keep score. And the idea is just don't make too many bad bets before you make a bet that works.

But just don't keep making the same bad bet because somebody told you, well, you got to spend money on marketing. Well, yeah, spend money on marketing that works. Don't spend money on marketing that doesn't work. And it's a test and recovery process. You know, one of the things that I talk to a lot is the KPIs and understanding which ones matter. And certain businesses have 50,000 KPIs. Right. The biggest thing for me is the fundamentals.

It's what's my booking rate? You know, first of all, how much does it cost to generate a phone call that's an actual opportunity? Out of those phone calls, what's my booking rate? How many times do I show up to the house and close the deal? And then what's my average ticket for service versus new install? Now those are very simple, but if you take those across the board and start comparing your CSRs, your dispatchers, and I would say, I'm not going to leave Tom Brady on the bench during Super Bowl, which means, are you utilizing your top employees? And what's really cool about it, and this is actually a recent story, Greg, had an apprentice start out, worked about five months in the field.

And he said, Tommy, he called me, he goes, I really, I'm ready. And I asked him a bunch of questions and I quizzed him on technical, operational, and sales. And he passed with flying colors. But the coolest thing about him was he sold financing on four out of the first seven jobs. And people might say, well, you pay a percentage for financing. When I finance somebody, I pay anywhere from 2% to 7% of the company. But the deal is is it's a 40% higher ticket. And people don't know, like it's, I do 12 months, same as cash. And instead of saying, Greg, there's this really nice door I'm going to sell you. It's a steel back door with polyurethane in the middle. It comes with two decorative hardware kits, a brand new three quarter horse opener, and it's $3,200.

I say it's $267 a month. Same as cash after 12 months has paid off, and it's an investment you'll have for your life. This is a lifetime warranty, high cycle parts. It's the last time you're ever going to need to replace it as long as you don't hit it. Right. And it makes a lot of sense. And it's what I would do if it was my grandma, my mom, my aunt, my uncle, that's what I would put them in. Well, it essentially demonstrates the simple philosophy I tell my clients all the time. Never make it hard for somebody to give you money.

So take a credit card. Do offer 12-month savings cash financing, and yeah, I'll take a cut out of the margin. And what people always say is, well, but I'm giving up margin. It says, well, but that's a sale that you wouldn't have gotten. And two, I would just look at it this way. I would just price it as if I would make my profit margin target as if everybody took the worst case scenario on financing costs. And then every time somebody doesn't do that, or they pay cash or they pay up front in that, I'm just that much

ahead. But that's a common principle that we see that people really struggle with. Oh, I don't want to take credit card. Well, you just shrunk the available customer pool dramatically of people you can do business with. And if you don't offer 12 months for big ticket items like that, if you don't offer that type of financing process, you just shrunk the available pool of people. One of the things we learned from working in the dentist industry is if you don't have accessibility to a financing plan for either cosmetic, root canal, or crowns, you're going to fail in two ways. One, your practice is not going to be profitable. And then two, you're actually not going to provide access to the public who can

afford to pay for that item and really need to pay for it for their dental health, but they just don't have the means to stroke the check right then. You're not selling them something that they don't need or can't appreciate or don't value. Now, it's different if you're doing that and selling a marginally valued product. That's different, but that's not who we're talking about here. So yeah, I mean, all of those things really matter. But I will tell you this, what I've come to the belief is, is the number one unequivocal way that we set profit targets for a business is based on your return on invested capital. Now, that's a little more higher finance concept that fortunately is,

hopefully, I'll get the next book out by the end of this year. I'm about a fourth of the way writing done now, and hopefully, I'll have the draft by early summer and then go through editing and all that. But I think this really nails it because we've applied this principle to every business we work with, regardless of industry. And in North America, there's not a business that we've had that have failed the 50% return minimum standard. And most of them average 75% to 100% return. So, Tommy, here's the question I want to ask you. You've started a business, you've gotten going, and you're making a little bit of profit, you're making your salary, making your full market wage.

If I told you that if you left those profits in the business and used it to grow your business, it'd be the equivalent of having 100% CD. So if you had $100,000, would you be interested in 100% interest on that for one year? Absolutely. Leave the money and let it work for you, right? That's right. And then the point is, so you invest, and a year from now, I come back and say, Tommy, here's your principal back of $100,000, here's your $100,000 in interest. Oh, by the way, the IRS can view that interest as taxable income, so they want to take their – they and the state take about 40% to 50%, depending on what state you're in. And so let's say you got $140,000 now. I mean, you got $160,000 after tax. Would you like to do it again? And the answer unequivocally should be yes. And so the idea is you keep reinvesting the profits back into the business because the message that I want to get out to your audience today is if you're running a profitable business that is meeting these standards,

you've got a 75% to 100% CD in your hands, and you need to not starve that business from the cash that it needs to be healthy and strong. Now, there's going to be a point that putting another dollar towards it doesn't gain you anything. And so there's a point that the market says, I've got enough. And so if you're, say, a Mr. Sparky franchise, maybe you've really saturated all of the marketplace that you're serving. Or if you're a one-hour heating and air company, you've saturated all the market, the next percentage of share just isn't worth the cost to go get. Sometimes the bank comes back to you and says, hey, Tommy,

I know you've been reinvesting and we got you up to about a million dollars of 100% CDs. Glad to let you keep those. The next 100,000 you put in, it's going to be at 3%. Yeah, it's diminishing returns at that point. There's going to be a point that it hits the wall. And so once you get to that full capitalization point, this is kind of the magic number that our study has shown, is once you get fully capitalized and you've kind of achieved your market position, you're able to then turn that business into what we call a harvest to premium sale business. And the reason why we say it that way is because one, you're in an industry that there is a lot of private equity money chasing right now. So that's something your listeners need to

understand. Secondly, a business that really is messy and hard to deal with, we call that a run to harvest business. I can probably be profitable, but nobody's going to pay me a premium for it. So get your salary, make as much money as you can, but probably you need to be diversifying those profits into something else because throwing more money back into it probably is not going to grow it

once it gets to its mature stage. In a business that like you're talking about, we call it a run-to- to premium sale, is that I'm mature and so I can now take the profits out of the business and run what we call the 40-30-30 play. So 40% is held back for taxes, 30% is retained in the business for growth, and 30% is distributed. So that means that I can distribute up to 30% a year of profitability, and still the business can continue to grow at probably a 10% to 15% rate easily from that 30% retention. But you've got to get the full capitalization first. And where most businesses fail is they never are patient enough to get the full capitalization

before they try to run the 40-30-30 play. Now, what happens is in most of your businesses, if you really run a home services business correctly, I actually don't need any cash to grow. I just need good execution because I'm not carrying receivables. I'm getting paid upon service. And so I might even get some payment in advance. And so I have an infinite ability to scale without burning cash. I just make more money. And really only a launch capital spend of where maybe I launch a new truck and I got to get that guy spun up and out servicing, or I seed a new territory and I got to go spend some money to launch that. I mean, that might be the only cash you might burn, but eventually and I got to go spend some money to launch that.

I mean, that might be the only cash you might burn, but eventually it's got to get up to its standard run rate. And so essentially, you've got really this business that you can harvest. But when we say harvest to premium, that means that the numbers we're seeing is I haven't had a client sell for less than 10 times EBITDA in the last two to three years. So 10 times in the home service space at what revenue though? Anything 5 million and above. I mean, that's a big numbers. That's... Well, but there's people that do that in those numbers that we have as clients. So, I mean, it's doable. And even to a certain degree. Now, there's some that even, I mean, if you have a really solid territory, I mean, you know, you might could even get that in the two to three million range. You might be closer to seven, but realistically, so one of the things

that's in the next book is I do this replacement return calculation. And so the idea is, you know, we've tried to give our clients a clear mathematical formula to understand, when do I sell and when do I keep? And it's a real simple process. Essentially, you just look at whatever you get offered to sell. You take the net after-tax proceeds of what I'm going to get after tax and say, well, based on the profit that I normally generate, not my salary, just the profit, relative to that net after-tax proceeds,

if that replacement return that I after-tax proceeds, if that replacement return that I had to take those proceeds and invest them in, if that replacement return is 15% or lower, I probably have a really good deal and I'll look at selling. If the replacement return is above 15%, you tell me where you're going to go put that money to work and make greater than 15% a year. That's where I got to get those guys to come back to the table and say, not worth it for me to sell. You got any more money. And really, as it's empowered our clients to say no, guess what? The demand to buy businesses right now is at an all-time high. And they have moved significantly further down the value chain of how big the businesses are trying to buy. I mean, I've never seen it like this in my lifetime, and I've been practicing a long time.

And I don't think it's going to change anytime soon because there's just a lot of cash out there that purchase money. Somebody can go purchase a business and they're willing to live with a 10% to 15% return on their investment as they buy it, and then they think they can double it or triple it in their hands instead of in your hands. And that's why somebody – so if somebody pays a 10 times EBITDA, they're inherently buying a business at a 10% return on invested capital if it continues to run the same way that they bought it. And so to them, it's not a horrible number, but it's not a great number.

But if they double it, the capital input to double it is a fraction of what they paid for it. And so now they're up to 20% return. And then if they double it again, they're up to 40% return. So that's the reason why private equity is cobbling together these service areas of businesses that, I mean, I think you got to look at, there's certain businesses, if you have a lot of low-end labor that's difficult to manage, those businesses aren't getting premiums. Because money, this is a phrase that I'm using a lot, money chase is easy. Entrepreneurs overcome hard. And so money is going to look at the structure of a business

to say, if you haven't figured out a way to make this easy, then we're not interested in investing in or buying you. And so that's really kind of the key that your listeners could really benefit from

is the more that you have solid, repeatable processes and consistency and ability to hire, train, and deploy labor, those are critical things to get premium valuations. Even if you don't get a premium valuation, you still run an incredible business and harvest the profits and build significant wealth just from that. Yeah, it's incredible. I mean, yeah, and I agree. Manuals, org chart, depth chart, having a CRM, that's the foundation. Having the same truck in every one area. So if I switch trucks with a technician, it's the same exact

truck. Right now, we just got our vendor to take over our entire inventory for 12 states. They're going to start doing everything. So it's, those are things. And then, you know, like I said before is I got rid of home Depot and people are like, man, people fight for home Depot.

Well, it's the bottom feeders fighting for the home Depot because not profitable. I mean, it could be if you're like a three man show, but go back to the opportunity cost. Right, exactly. Well, I mean, we had a landscaping client in the Midwest that they were working with in sprinkler systems. And their hope was that after the development was finished, that they would get the ongoing service for those customers.

You know what the problem is, is when somebody moves into a house, one of the things that they don't feel like they need to spend money on is a maintenance agreement for the irrigation system because it's a brand new system. And they don't have a whole lot of cash anyway, so they're trying to get by. And so they didn't get the penetration that they were asking for. The builder was a pain to work with. And basically, they were getting half the margin on those contracts that they would have gotten from their standard service. And they had their best people working on it. And I said, listen, guys, it's time to cut them off.

I don't care if they're $400,000 of revenue. Their margin sucks. So get rid of them. As soon as they turned them off, the builder was just astonished. It's like, what? And I was like, yeah, sorry. And they haven't missed them. I mean, their revenue went down, but their margin went up.

Funny how that works. Well, you know, I talked to a guy, Parker and Sons. They do about $90 million a year just in Phoenix between plumbing, HVAC, and electric. And I asked Josh Kelly, who's an amazing guy. He owns another company called Review Kangaroo. But anyway, I said, what's the biggest mistake? And he said, Tommy, I think me and you have talked about this. We were in Hawaii one year.

And he said, we went straight for revenue. We were only growing revenue. And that's what I did last year. If you're only trying to grow profit, sometimes it's, you get stuck. And if you're only trying to go revenue, you can lose money fast too. So there's a happy medium where last year, you know, we're pulling the ropes back now and going, this market's not profitable. We've, we've overhired right now. We have the ratio that I've always heard is two guys, compared to compared to one guy in the admin, whatever.

That's a manager, call center rep, warehouse guy. And when those ratios get skewed enough, it makes it tough to make money. Yeah, I mean, to a certain degree, I mean, those can be simplistic. But I think there's people that are creating disruptive business models that can break those molds. So I always want to be careful with those. What we look at is the thing I would tell people is take revenue out of your discussion. So we recommend don't discuss revenue, discuss gross margin and contribution margin. And so the way that if you look at our data sets, we say revenue minus your cost of goods sold is gross margin. Gross margin minus your direct labor with no burden, just direct labor, just wages, that is then the net of that contribution margin.

We believe contribution margin dollars are the critical number of every business we work with. And the reason for that is it's the simple, clean output of your business engine. Because I can get married to a percentage. It's not about percentage. You can't take percentages down to the grocery store and buy groceries. I can take dollars. And it takes contribution margin dollars for us to cover our operating expenses and deliver a profit. And so to us, that's really kind of the critical thing. And so then when we take a business and turn it on its side and start to look at segments, it is about that. We can generally get down to contribution margin by any segment. So I can look at it by line of business. I can look at it by customer. I can look at it by location. I can look at it by location. I can look

at it by region. And so to us, that's really kind of the power piece because there's not a lot of choices that you can make to your operating expenses that's going to change things. Granted, you don't waste money there, but at the end of the day, it is about contribution margin production is the number one output that you've got to focus on for the company in total and by segment. Yeah. If we go back to the days of some of the guys out there, they're killing it, okay? So let's just play a scenario out real quick here. A lot of the guys I know in the home service space, I don't care if they're roofers, if they do chimneys, gutters, they absolutely own a market. They get to the point, whether it's Atlanta, Detroit, whatever the market might be.

And then they say, I think I've penetrated this market where the best thing to do is if I'm in Detroit to go to Kalamazoo or East Lansing or another area around there, but their eyes are not on the ball a lot of the time, which is a mistake. But I've always said it's going to take two to three years to penetrate them, not even to penetrate, but to get that name recognition, to get the technicians trained and ran correctly. And it takes even longer if you're not there. So, and I understand what you're saying about the gross contribution, but I guess the question I'm asking is if you decide I've penetrated, there's a point of diminishing returns in this market, but to go do

what I did in this market, which it took me eight years or 10 years or two years, whatever it might be, what do you recommend as far as I'm really good. I can put out great technicians. That's what it's all about. Great technicians, my call booking rates, and I know good lures to use to get the customers to bite. So what do you recommend as far as growth? Well, I mean, you know, the money that's looking for easy thinks you just go buy somebody in that market and launch them. And last time I checked, there's a lot of skunks in the woodpile, you know, when you buy somebody and the price that they're asking for is just crazy high right now that it would just take you, it takes too much money and the potential return. I mean, if you find a good deal, great. I'm not, it's not that I'm against it, but it's got to be the right price. I'm actually a fan of the

clean launch process. And if you understand, so this goes back to, as I said, the four forces of capital, you know, so if I'm launching a new area, so one of the lead professor at our EO at Horton program, David Wessels, he has a phrase that I really love that's called, change your where, not your share. And so when you get to this mature point, as I said, the next percentage of share just didn't worth the cost or the benefit. So I got to change my where. So there's a reason why we do $5 million of revenue as a CPA firm in Huntsville, Alabama, and 85% of my clients are not in Huntsville. We changed our where. I couldn't do what I do if my where was Huntsville, Alabama. There's not enough people, not enough businesses that appreciate what we do. Matter of fact, I mean, it's the

concept of when I do work locally, I'm a local CPA. When I leave town, I'm an expert. And so, from that standpoint, it is that thing that when you start to expand and look at geography, that becomes a component model. Now, granted, you're not going to get to an eight-year maturity overnight, but I can be incrementally contributive within a 12 to 24-month cycle, I do believe. And so you have to come up with a launch plan that says, how do I see that market? Who's the right people to launch it? And to be quite honest, there's a different skill set in launching versus maintaining. So those are the things that, I mean, just as a

numbers guy, I am much more interested, and it's a lot less money to launch a greenfield new market than it is to overpay for somebody to buy and jump in, in my opinion. Not to say that I wouldn't buy if I caught the right deal in the right circumstance. But I've got to have fiscal discipline to know what's a good deal and what's a bad deal. So what if you examine someone's books and you could get it for three times EBITDA? I mean, but you know going in that you're going to get it. I got to get four or less. And I got to feel good about why I'm getting it. And there may be some synergies with their team and all those kind of things. But yeah, it's got to be four or less to cash. Because in my original book, if you look in chapter nine, I created an economic valuation formula that's been pretty powerful for

our clients. Because essentially, it helps you understand the economic value of a business and how to pay for it out of its own cash flows. So essentially, that formula is quite simple. It's three times net income plus equity. So it's a capital component and an earnings component. And when you look at values of businesses, you cannot separate the capital component from the earnings component. They must go together because some businesses require more capital, some require a lot less. And so that's a critical piece. But if I can get something for less

than that economic value and it pay for itself in five to seven years, I'd consider it. Because especially if I know that I can improve it. But the key is I would never buy it unless I feel like I can do better with it than the hands of the people that I bought it from. And that's the part that you've got to be really disciplined to be committed to. Blended method for calculating economic value. I just pulled it off my shelf here. Simple numbers, great talk, big profits.

Yeah. That chapter nine has been, we use it to value buy-sell agreements. We use it to buy stock buy-ins from employees. We use it for phantom stock plan valuations. It's been a very well, because essentially it controls the calculation because it has to meet cash flow requirements in the process. Yeah. That's really interesting. I love talks like this because, you know, blue collar industries, we're not really blue collar. You know, we get labeled as like this. Yeah, we're not going to go do an IPO tomorrow. Don't get me wrong.

But at the same time, I've heard about private equity and capital venture money coming in like crazy. Absolutely. I got a buddy that just got offered $75 million for his company and he didn't take it capital venture money coming in like crazy. Absolutely. I got a buddy that just got offered $75 million for his company, and he didn't take it because he's at 20%. He's a $50 million company. Yeah. But he's growing.

If you look at what he was last year, a 25% increase, and if he continues to do that, hope for the best, plan for the worst, because you don't know what's going to happen. So it goes back to your earlier statement about Amazon. There's a reason why Amazon is interested in the home services market. They're not idiots. They do some things that makes my head scratch because I think they've fallen in love.

They live in an ether world called other people's money. It's how they survive. So we've got to understand that we can't play under those terms because we don't have other people's money. But there's a reason why they're interested in that market because there is margin to be gained. But I think it is the understanding that there are certain things. So Amazon can dominate the book-selling market because it's a thing. There's not an absolutely necessary human interaction required. Last time I checked, if I need electrical service and I need HVAC service, there's a human that I

got to interface with. And so even if Amazon is the selling party, there is a business, I mean, a good example. So like Lowe's, twice in my old house and in a house that one of my sons bought, we had to have the front door replaced. And so we bought the door from Lowe's and we said, we'll just let them install it. And the same guy showed up both times. And it's a contractor that 100% of their business is installing stuff like that for Lowe's. And it was, I mean, being a business nerd, I mean, I'm standing there while they're installing the door, I'm talking to them about their business. And it's like, hey, I mean, they're running a great contracting business. And so they're really the person I'm interfacing with. Who cares that

I bought it through Lowe's? The reason why I bought the second door from them wasn't because of Lowe's. It was because I was so impressed with the guys who installed it. And so they actually did more to connect me to the customer relationship than the brand Lowe's. To me, Lowe's and Home Depot are, ah, you know, that's just a big box. They don't know me from Adam's house cat. But there again, you know, when you can connect to that person delivering the service, you know, those relationship buildings and those kind of things. So I really think, I mean, you know, your audience is in the hotbed of profit potential, and there's always somebody you can out-compete because they get sloppy, they get lazy, they don't mind the store, they don't train their people correctly. And I just always believe, you know, if you want to find the gold in business, find the necessaries and then

just go out, compete the people who are underserving their customers. Yeah. And I'll tell you, the one thing that I've woken up to, Greg, recently is we do a really good job of marketing. People come to us. The phone rings all the time. Whereas one of my buddies owns a pretty good job of marketing. People come to us, the phone rings all the time. Whereas one of my buddies owns a pretty, pretty good solar company and they do some energy audit stuff, but he goes out and gets it. You know, not that he doesn't have a good line reputation in that, but he goes out, they door knock, they do an outbound call center with 10 agents and they create, they create this out of thin air. And one thing that I actually looked at the other day, I had a buddy send me this triangle, right? It's like, it almost looks like a food hierarchy.

You know what I'm talking about? Yeah, absolutely. So interestingly enough, I'm pulling it up right now. When you look at what these people are going for, only, here it is right here. So it's called the marketplace pyramid. 3% are buying now, 6 to 7% are open to buying now. 30% are not thinking about it. 30% don't think they're interested in 30%. No, they're not interested. So the point being is hitting people

lower on this, this pyramid and getting them interested. Because if you only got 3% that are actively looking for your service and you're fighting everybody on it, how can you get into that other 30%? Where the 30%, they're not really thinking about it, but they know. And that's what he does. That's one thing that he's going after 30%. And a lot of us are going after 3%. Yeah. Well, there's one guy, are you familiar with Barrett Ersk? Have you ever heard of him? He had a company called Happy Lawns.

No, I'm not familiar with him, but I'm writing his name down. What's his name? Barry? Barrett. Barrett Ersk. Barrett Ersk. Yeah, Barrett was,

he's a marketing genius. He's got a great life story and he'd be a great one for your audience. Listen to, because he tells a story. He really got super focused on the marketing side of things and just blew up his lawn business. And then he promptly lost half of the customers he won because he failed to deliver on operations. He's one of our EO members that does a lot of exec ed stuff too and great guy to connect with. But from his standpoint, I would always say it's real easy. Number one is I'm just a fan of let's make sure we take care of the customers that we've got

or else somebody else will take care of them. So you got to be careful there. You can get so focused on winning the next customer that you forget to serve the ones that you've committed to. And that's where I truly believe that in terms of marketing power and brand and those things in your marketplace, you just got to be top shelf. And really, the one thing I'll leave you with, I just recently got turned on to this group in Kingsport, Tennessee called PALS Sudden Service, P-A-L-S Sudden Service. It's a drive-thru hamburger chain, but they're a Malcolm Baldrige Award winner and they've got 29 locations, so it's a regional chain.

And they have a business excellence institute called PALSBEI.com. Listeners can go look at it. But I'm telling you, this is the most fascinating business I've ever seen in my life. And I've seen a lot of businesses. But these guys deliver on a brand standard

and accountability standard that's second to none that I believed. And it's kind of like their mantra is 100% the brand standard, 100% of the time at 100% volume. And that's kind of what I've started talking about to our team

about is where I realized after going through their two-day class that I hadn't done an awful job of defining our brand standard in a definable way that there was no ambiguity. And then once you define the brand standard, I got a means to hold people accountable to it. And what these guys accomplish is incredible. I mean, they've got like one, you know, it's just a drive-through, you know, no indoor seating. And their business model is just incredible in terms of how each location is run. And 90% of their workforce is 16 to 18 years old, which is not exactly the prime employment group, you know, that any of us are looking for. But they deliver extraordinary results. They have one customer complaint in every 3,500 transactions. I have one complaint in every 10 transactions with the national brands.

And so, I mean, it's just off the chart in terms of if somebody wants to really look at operational excellence and really, as I call it, your listeners, I'll leave this with them, the idea is we can all come up with systems and ideas and repeatable processes. The trick is how do you get the humans to do it? And so that's really the thing. I mean, where most of us fall down is we come up with a great idea. Great, I solved that problem. And then the next thing you know, you turn around and that thing's broken again. And it's because how do I get the humans to consistently execute on that process? And you can talk about fuzzy things like culture and better hiring. And yes, all those things matter. But really, at the end of the day, I've really got to have a complete process that really connects

what we do and an accountability structure that people actually are drawn to not run away from. And the vast majority of people run away from accountability. And there's actually a way that you can structure accountability. And this is what I think is phenomenal, what PALS has done, is create an accountability structure that people gravitate to rather than are repelled by. So it's pretty incredible. You know, what's funny is 2019, my whole slogan this year is all about accountability. And I always say when human behavior is measured, human behavior increases and improves. And I'm looking here, I've got this carbon copy. One of my coaches, his name is L.E.V., the consultants,

and he said, when we have a problem with somebody, and, you know, because one of the first thing that one of my managers said was, you know, we teach these guys how to do it. We teach these gals, we go over it with them, we show them exactly what needs to be done. We created a manual for them, and they still don't follow it. He said, well, do you have them show you? Do you have them sign off saying they acknowledge the fact? Do you hold them accountable? And do they sign off? Literally when they sign off, the one thing we got, Greg, is we've got, we have them sign off when they got something new that they knew exactly how to do it and they showed us. Behavior increased dramatically. And I don't like the word behavior, but just overall

results increased. I will tease your listeners. I won't tell them how Powell's does it, but they need to go check it out because they actually take it one step further. They do the step you just described. They take it. No, they do not do

anything special with compensation for the team. They have an incentive program for the managers. But other than the store manager, everybody's paid the same wage that the national brands pay. And so it's not compensation. And I am a firm believer that money is not the motivator. It is just the back-end rewarder of reinforces. But it is not the thing that causes a person to act differently

in 99% of the cases. It really is one of those things that they just got to process, like I said, that's second to none of any business I've interacted with. And like I said, I've been inside the guts of a lot of businesses and seen the real thing. It's pretty amazing. But it is that thing that I think there are these exceptional businesses and certainly people like yourself. These are powerful ideas that your listening audience gets to hear real stuff and not just the fluff

that made a great headline. Let's talk about the successes and the failures and let's learn from them. And let's just try not to repeat the bad mistakes over and over again. So what is it? The pals, you said you were going to give us a teaser. Well, that's the tease is you got to go check it out. So I'm looking right now, it's registered for class. Can an outsider take the class?

Oh, absolutely. Absolutely. It's open to the public. Yeah. It's a two-day class. It's the best two days of business education I think I've had in my lifetime. It's that powerful, huh? It's that powerful. And everybody I've sent there, so I've sent, I've had four of my other staff go and everybody came back, said the same thing. I've had probably four or five clients go and they've all said the same thing as well. So I've got it on pretty good authority that I'm not just drinking the Kool-Aid. Kingsport's not exactly easy to get to, so it takes a little bit of effort. But here's a teaser.

So if you've had six months or more work experience at Powell's, working in a drive-thru hamburger chain, the number one employer in Kingsport, Tennessee, is Eastman Chemical. So it's the chemical part of what used to be Eastman Kodak. Very big employer. They will grant you an immediate interview for a job if you have six months or more experience having worked at Powell's. That's how much they respect what you learned while you worked there. Well, I think the thing I'm taking out of this, and I've got a lot here, but this last piece is what Starbucks,

there's a good book at Starbucks that talks about how when you work for Starbucks, when you come out of there as a better human being, you're actually taught skills that are about life and about saving money and about going after your dreams. And that's what they do is they create this opportunity. And I can attest to that for Starbucks because my youngest son worked at Starbucks for about five years while he was

going through school. And absolutely, he actually learned a lot. And I got to see, granted, there's things that you like and dislike about Starbucks, but they do what they say they do. So I was really impressed over those years that you're exactly right. But Powell's takes it to another level than even Starbucks, in my opinion. You know, you got me excited. I'm going to check it out. Yeah, check it out. Let me ask you this, Greg. If somebody wants to get a hold of you and they want to hire you or just learn more about you, what's the best ways to do that? The best way, I mean, just shoot me an email, greg.crabtree at crbcpa.net. The book website,

simplenumbers.me. There's a contact form there that'll come to one of our team. Happy to chat with folks. I mean, our business model is, and this is something your folks need to know, we only do business with clients that do consulting with us. So it starts with an initial session that we believe is pretty affordable and an ongoing minimum process that we think we've made affordable and valuable. But we will only do traditional accounting services of tax and opinion financials and outsourced bookkeeping for clients we consult with. And there's a fundamental philosophy for that. We want to work with clients who want to create a planned outcome.

If you do not want to take the time to create a planned outcome, I'd really rather you just buy those commodity services from somebody else because it really, you know, we believe in the cohesive idea of helping you set that plan and monitor it. And then secondarily, then taxes are obviously a key cash flow component that needs to be planned for and done appropriately. And then whether or not you need opinion financials for credit support or those things, we certainly do those. And then a good bit of work we've done is actually our accounting solutions team. It goes in and helps people fix processes. And we'll do some outsource bookkeeping where we do it in selective cases

because really we look at it and say, you know, we really want to help the client make the best economic choice. And so if they really need to be doing it themselves instead of us, we'll push them that way. Because there's a point that a lot of people like to just push it off on us. I said, no, no, no, that's not going to be the best outcome. So we practice a little differently. It's not about what we can sell you. It's about let's do what adds value for you. Yeah, that sounds great. I'm super, super impressed. You're definitely a wealth of knowledge. And then I always ask if you had three books, obviously, let's not include yours, which is Simple Numbers,

Straight Talk, Big Profits, The Four Keys to Unlock Your Business Potential. But if maybe a few other books that you'd recommend, I already just bought the book that you recommended earlier with a customer-funded business.

Yeah, yeah. What else would you say? Oh, gosh. Well, number one on my list, I'm a huge fan of Springfield Remanufacturing and the great game of business that Jack Stack wrote. So, you know, to me, that's a timeless thing. I learned a lot by doing their two-day plant tour

is actually a quite good educational event as well. So I'm a huge fan of that one. I would probably say, you know, what's interesting, I'm a fan of this idea, we talked about this, of behavioral economics. And so there's a great book called The Small Big by Stephen Martin. And each chapter is a behavioral economics study. And so to me, I think it's kind of a sleeper, really good book in terms of understanding human behavior and why people do the things that they do. And so that's really one that I kind of throw out there. I've always been a fan.

Eli Goldratt, who passed away last year, I think, he wrote a book called The Goal that he was famous for. Actually, his book that I recommend is actually called Necessary But Not Sufficient. And actually, it's an allegory. So it's told in story form. And it's an allegory of his own personal life experience of having an ERP software business that he gets fired from by his board because he starts challenging the value proposition of their software. And because he comes to find out that even though they're highly profitable as a business, they're selling things that people say they want. He actually gets a crisis of conscience that they're not actually delivering on the value

that their value proposition says. They're just selling this sexy thing called ERP software. And I just love that concept. Something may be necessary, but it's not sufficient for the goal that you're trying to achieve. And so I always thought that was a really kind of an interesting book. I love it. Well, I'm going to get that. And the last thing I do is if there's something we might have not spoke about or one last thing you'd like to leave in our listeners' head, go for it. I think the entrepreneurial journey is one of the most fascinating. I would tell you that had I not joined a group like the Entrepreneurs Organization and having a peer network, I will tell you that being a business owner can be a lonely experience unless you find a network

to connect with other business owners. Because when I'm in a group of people that I talk to that are not business owners, they don't understand what it is that we as owners have to carry. We worry about making payroll every two weeks. I always kind of joke, you're not an entrepreneur

unless you put payroll on a credit card, which I've done. And you try to live to not have to do that ever again. And so the idea is I would encourage your listeners that own businesses, go find you a peer network, whether it's EO or whether it's YPO or Vistage, or there's thousands of them all over the country. Most local chambers of commerce has some peer groups, maybe start there. You need a support group that understands the pressures because not everybody you interface with in your social life understands what you're going through.

And I would really encourage, it's well worth the investment. I have gotten the return many, many, many times over what I invested in my EO membership over the years. I mean, my life would be dramatically different had I not done that. Yep. I'm a big part of a few different things like the Young Entrepreneur Council, things like that. Yeah, absolutely. Just meeting people, discussing with them. And it's not about, sometimes I say it's not about what you know, it's who you know. And a lot of doors get open by just going out there and asking people questions. because, you know, for me, one thing

that I've realized, Greg, is I've made a lot of mistakes, but I just try not to make the same mistakes twice. And learning from other people's mistakes and actually listen to them. And this podcast is what this is all about. I love hearing about not necessarily mistakes, but just people that went through it and they got out of it. They learned from it and they were successful afterwards. But I got to tell you, I know we had some technical difficulties, but I really appreciate your time today. Oh, you're welcome. Yeah. Glad to do it and hope your listeners enjoy it and wish them much success. All right. Thank you so much. I appreciate it. Hey guys, I really appreciate you tuning into the much. I poured two years of knowledge into this book and I had 12 contributors.

Everybody from the COO at HomeAdvisor to the CEO of Valpak and of course, Ara, the CEO of ServiceTitan. It tells you how to have the right mindset and become a millionaire and think like a millionaire. It goes into exactly how to turn on lead generation. Have those phones ringing off the hook for the customers that you want to be calling where you can make money and get great reviews.

It also goes into simple things like how to attract A players. Listen, if you want a great apple pie, you need to buy good apples and you need to know where to buy those apples. And it also talks about simple things like knowing how to keep the score. You should have your financial check every week.

You should know exactly what's coming in and out of your account. You should know when to cut advertising that's not working. And more than anything, you should know how to cut employees that aren't making it for you. Listen, you might have a big heart, but this book is going to show you how to make decisions built on numbers. I hope you pick up the book, and I really appreciate everything. I hope you're having a great day. Tune in next week. Thank you.