The Ramsey Show - App - The Difference Between Employees and Team Members (Hour 3)

Episode Date: October 24, 2019

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I am Dave Ramsey, your host. This is an Entree Leadership Theme Hour. What in the world is that? We're going to talk with business owners, business leaders, small business, large business, whatever you have, but primarily small business folks, and we're going to answer your questions about running your business better. The phone number is 888-825-5225.

So what is Entree Leadership? Well, we teach business and business leadership all over America and have for a couple of decades. And Entree Leadership is one of the ways we do it. Another thing is called Business Boutique, and that's where Christy Wright has an event once a year that goes with her number one best-selling book, Business Boutique, equipping women to make money doing what they love. That event with 3,000 ladies begins tonight, and it's been sold out for a while and goes this weekend. It's going to be a blast. I'm looking forward.

I get to speak. I'm looking forward to it. We do entree leadership events all the time, all over the place, different kinds of events, all to teach, support, inspire, and work with, particularly businesses that have a couple of hundred team members or less. And where did this come from? Well, I started this business on a card table in my living room. And then I realized I had a lot of work to do.

Turns out getting people out of debt is like a big job. Me and Jenny Craig got a lot of work to do and so i figured out i needed some help see i was so dumb though that i thought if you hired people they would work that was dumb i thought if you hired people they would care that was dumb and it turns out you have to hire people that work and hire people that care or they don't work or care. And I just thought if you had money and you got somebody that wanted a job and you gave them money to do a job that they would do the job.

This is how dumb I was. And so I had to start out with learning the lessons between thoroughbreds and donkeys. You cannot win the Kentucky Derby with donkey. You can win one with thoroughbreds and donkeys, you cannot win the Kentucky Derby with donkey. You can win one with thoroughbred. And so if you're going to run a, you know, if you're going to play for the Super Bowl, you better have some people that can block, tackle, and throw the ball, instead of just standing around discussing the subject in theory, or writing a blog about it from their mother's basement, and bitching and whining about how everything isn't going their way.

So people that can scratch and claw and grind and hustle and get stuff done. And that's what we do around here. And so I went through the process of putting the right people on the bus, as my friend Jim Collins says, getting the wrong people off the bus and the right people on the right seats on the bus. And that's not to be mean to anybody, but some people suck at things and they should do something else. Jesus' name. And so that's what we help them do because we love them,

and we want them to go find their calling because they didn't find it when they were here. And so we're kind to them. We're nice. We're real clear. To be unclear is to be unkind. Can you imagine that I'm pretty clear? Yep. And we're pretty clear? Yep. And we're pretty clear with each other, by the way.

People clear with me all the time, too. It's okay. I'm not mad about that. I want to know what the flip's really going on, and we're really going to deal with excellence and get her done. So I figured out that if I hire a bunch of entrepreneurs, entrepreneurs like me, we're all a little bit add or a lot add we're pretty much you've got a whole room full of entrepreneurs that's like trying to nail jello to a tree it's like trying to herd cats and so i knew i didn't want a whole room full of entrepreneurs and then i thought well i'm going to just teach leadership well leadership kind of

sounds like management class by a guy who never made payroll and was a tenured professor and so i couldn't do that either so we put the two words together and said we want the energy of the entrepreneur and the polish and the diplomacy and the honor and the nobility of the leader we put them together and we came up with this word we made up a word that's what we do in tennessee we make up words entree leadership and then we put down all the stuff we were doing that was causing us to win as we grew from 10 to 40 to 100 to 140 to now almost 900 folks on this team. I think we are over 900 this week. And we win Best Place to Work in Nashville.

We've done it for 11, 12 times now. Why? Because we're the best place to work in Nashville. That's why we win it. And so it's pretty simple. And we treat our people unbelievably well, and we work our butts off to take care of you guys. Put all of that in a book, is our super bowl playbook on how we've run this business how we've grown it from a card table in my living room to where it is today and we now teach business owners from that book it was the

number one bestseller and the book is called oddly enough entree leadership and we have these wonderful entree leadership summit events that are massive and very cool. We're doing one in May over in Orlando, May 17th. Mike Rose coming. Damon John is coming. Carly Fiorina is coming. Craig Groeschel is coming. Benjamin Zander, Kat Colchris, Hogan Christie-Wright, Ken Coleman, and me.

It's going to be a three-, four-day event. It's going to be a game-changer. It's going to be a blow-, four-day event. It's going to be a game changer. It's going to be a blowout. It is a blast, very high-end, very high-energy event. And then we also do a thing called Entree Master Series, which is a week long, and it pretty much gives you an MBA, a master's in business on the meat and potatoes, the very tactical stuff. Here's exactly how you do hiring. Here's exactly how you do hiring.

Here's exactly how you do firing. Here's exactly how you work contracts. Here's exactly how you put a marketing plan together. Here's exactly how you lead your team with goals. Here's exactly the difference in strategical and tactical thought and how you apply it to your business. We're teaching one of those week after next, November 3rd through the 7th, and we're adding a day to the back of it, an extra day on family business for those that want to stay over.

That's the family business research we've been doing. And there's only 15 seats left to that thing. That's Entree Leadership Master Series, and it's basically sold out. I've got 15 seats left for November 3rd if you want to come. And you will leave that thing completely wrung out. This is not, you will get the motivational stuff, but it is meat and potatoes. Your brain will be hurting when you leave. It's like walking up to a water fountain and getting a drink.

Somebody turns on a fire hose. It's everything you should have known before anybody let you open a business. And we're going to be all up in your grill, and you're going to go home and do the stuff. And then we're going to walk with you and help you do it. So that's what this is, and that's what we're going to be all up in your grill and you're going to go home and do the stuff and then we're going to walk with you and help you do it so that's what this is and that's what we're going to talk about this hour how we can serve you guys along those subjects if you're a business boutique uh your lady coming in for christy and you've got a question jump in if you are a small business person man or woman anywhere out there and you want to ask a question about running your business in any part or category, anywhere out there, and you want to ask a question about running your business in any part or category of business, that's what this is for. The phone

number is 888-825-5225. Dave, I notice that you always refer to your employees as a team member. Why is this, and does it help with company morale? It doesn't help with company morale unless you treat them like team members. Words are powerful. The Bible says, out of the abundance of the heart, the mouth speaks. Do you really think of your folks as slave labor that you give money to, employees, or do you really think of them as members of a team that when we pull together, we can win the Super Bowl. I really think of my folks that way. And I fully expect the lady that's supposed to block to block and the guy that's supposed to throw the ball to throw the ball.

We are members of a team, and if any one of us does not do our part, the thing falls over. It's a series of dominoes here working together. And so team members depend on each other. Employees come late, leave early, and steal while they're there. And that's not what we want. I don't want employees. And so, no thank you.

This is the Dave Ramsey Show. I got a call the other day, and I thought it was worth talking about again. It was from a wife looking for life insurance for her family. She asked why I only recommend term life insurance instead of cash value plans like Whole Life. I usually explain how you overpay for coverage, earn a horrible rate of interest, and don't get your cash value when you die. But this time, I just had her go straight to Zander.com and get a rate.

And then we compared that rate to the Whole Life plan, and she immediately saw the huge savings. She realized all the things she could do with that money, like paying down debt, investing in a smarter way. That made it real for her. It makes no sense to buy or keep a cash value plan when there are smarter, less expensive ways to protect your family. That's why I suggest that everyone go to Zander.com

or call them at 800-356-4282 and get a free quote. That's zander.com or 800-356-4282. It's an Entree Leadership Theme Hour, taking your business and small business questions. Patrick is with us in Indiana. Hi, Patrick. Welcome to the Dave Ramsey Show. How are you doing, Mr. Ramsey? Better than I deserve. What's up? Well, real quick question. So a little bit of background. Several years ago,

I started a business where I'm teaching fire department supervisors, managers on how to be better leaders and how to better manage their firefighters and their team members. As that has gone along, I've gotten a lot of advice from people in similar fields, and I've built a... Hello? Are you there? Oops. Okay, let me try again. Kelly's messing with you, so I'm sorry. You've built a what? I teach fire officers in the fire department, so I teach leadership and supervision in the fire department.

So I teach leadership and supervision in the fire service. I got that. And as it's gone along, it's built up, and you got advice from other people. And then what? Oh, and then, but, you know, I keep money back in order to develop technology to have my emergency fund. I guess my real question is that I'm almost worried on how I pay myself. How do I know how much money to be given back just to keep for me? How much money are you making in a year top line before expenses? Before expenses, last year I did about $20,000 worth of work.

So this is a side hustle? This is a side hustle. Okay, you did $20,000 worth of work, and your expenses on that are what? In the range of about $10,000, somewhere there. Last year was a little difficult because I had a lot of technological expenses. Okay, in the coming year, what do you think you'll have top line, and what do you think your expenses will be? I think I'm going to match that. I think I'm going to be between $15,000 and $20,000,

but this coming year I won't have the technology that I had to buy in the previous year. That's what I'm asking. So what is your top line and your bottom line in the coming year? $15,000 bottom line, $20,000 top line. Okay. So you hardly have any expenses. Okay, cool. Yes. And is this a fairly steady flow, or does it come in big lumps? It comes and it goes it it's uh it's hustling you know talking departments into into hiring me so i may have a couple months where a lot of work and some months where i don't have any okay so what i would do is just set a limit in the checking account and this business needs its own separate checking account i'd set a limit in the checking account that anytime it gets above x i'm going to take it home. Okay.

And I'm going to tell you, if it was me based on the numbers you gave me, it's probably $4,000 or $5,000. Okay. And so when it breaks that plane in a given month, whatever amount, so if I got $7,000 in the account, I'm going to take two home. Okay. You don't have a steady enough flow or enough to put yourself on a straight payment you know set same amount every month that is a substantial amount i mean you can put yourself on a hundred dollars a

month but that's ridiculous to screw with okay but uh it's easier to just say everything over five thousand i'm taking home now when you pull it out of the business checking account to take it home that's when i set aside a fourth for taxes. Yes. And so if you pull $2,000 out, set $500 in an account for your quarterly estimates, and that leaves you then $1,500. So you write two checks, $1,500 for my personal account, $500 for my business tax account over here, and then once a quarter you're supposed to do quarterly estimates.

You're going to find $.53 or 15.3 because you get both sides of self-employment tax because the federal government loves small business, so they double taxes. And so you get both sides of it. And then above that, you've got your income tax withholding. And so that's going to bump you in your area. It's probably going to be under 25%, but 25% will keep you safe. So one-fourth of whatever you take home, set it aside for taxes,

and then just take the rest of it home. And if you look up and you go, you know, I have $5,000 in there, but I'm going to spend some money on technology this coming six months, and so I really need $7,000. Well, then bump it up a little if you want. That's just your little retained earnings is all that is. Now, you do have to pay taxes on that money too too, at the end of the year, by the way. Yes.

So be ready for that as well. But, you know, you can pull enough out of there. If you've got $5,000 in there, you can pull $1,250 out if you need to to pay taxes and then build it back up. But because you don't get, you know, do not do a C corporation. They're horrible for small business. So you're in an LLC or an S corp or your sole proprietor, any of those three, whatever money is in your business account is profit at the end of the year.

And so, you know, whatever your real profit is is your real profit, regardless of which account it's sitting in. You don't get out of that. So even at a business my size where we're doing $200 million gross, we set aside a percentage of our net profits every month for our growing our retained earnings, but I get taxed on it at the end of the year. And so if I set $2 million aside for retained extra for retained earnings this year, it means I get to send the government a half million of that, and I didn't take any of it home.

It's still sitting down here. Because, again, the government loves small business. And so even though I didn't use the money, I didn't take it home, I didn't personally consume it, it's sitting here for business use, I still get taxed on it because these people in Washington, every time they say they love small business people, just in your mind yell at them, liar. Okay?

All right, David is with us in Illinois. Hey, David, welcome to the Dave Ramsey Show. Hi, Dave. Great talking to you. You too. How can I help? Well, first off, I just want to say thank you. Last time I talked to you, you actually gifted me two tickets, and my fiancee is in Nashville right now going to the event tonight. Great!

Just wanted to give you a big thank you for that. She's super excited. So getting to my question, a little bit about my business. I started a handyman business recently, and without knowing it all these years, I have been practicing servant leadership. I was a guy on the construction side that although I was running, I was giving them materials and them everything that they needed to do what they need to do. And so with that philosophy, of course, I came across you and, you know, we are like-minded. So with that moving forward, I pay close attention to what you, especially your open monologue this afternoon about the kind of people that you hire and your process for hiring. I've got my foot in the air to hire somebody because I'm ready to expand. I just don't know that first step of where to put my foot down and kind of where to start.

Okay. Well, when you're interviewing them, you have to spend time with them. One 30-minute interview and hiring someone will cause you to hire bad people. Right. Okay. I used to use the mirror fog process. If they fogged up a mirror, I'd hire them, and I ended up with a whole stable. Yeah, that's very common in construction.

Yeah. I used to, I mean, if you want to work, I got money. You know, you fogged up a mirror, you're in, you know? And so you end up with a stable full of donkeys, and you spend all your time dealing with donkeys kicking each other instead of getting the work done. And so, yeehaw, yeehaw, it's all you hear all day long, you know? And so you have to spend more time.

It's more trouble to hire good people than it is just to hire humans. The good news is you don't have to do it over. When you hire donkeys, you get to do it over and over and over and over again because you're always having to get rid of them because they're causing trouble, stealing or fighting or doing something else, right? And so, you know, when you hire good people, they stay. And they want to hang out with other good people, by the way. Thoroughbreds like running around with thoroughbreds.

They don't like running around with donkeys. Right. And so take more time, number one. Take more time. Lots of time. Take them out to dinner. Take them out to lunch. Spend time with them. Discuss it. It'll start to feel almost like it's absurd how much time you're spending. But you're going

to... You ever heard that saying your mama used to say, anything worth doing is worth doing right the first time? Absolutely. Hiring is that way. If you shortcut it, you get to do it over. And by the time you do it three times and finally get one good person, it would have been cheaper time-wise to have just done it right the first time and spent more time.

The last thing we do is we do a spousal interview. At the end, the last interview we do, we go out to dinner with the potential team member's spouse and one of our leader and their spouse. In the old days, it was Sharon and me and you and your spouse if you were coming to work here. And it's nothing formal. We just go out to dinner. Because when people have dinner together and they're with their spouses,

they let their hair down and they're like real, and you find out who you're really dealing with. And your wife can look at them and go, I got a bad feeling about this one. If you hear that, run! Every time Sharon has a bad feeling, it costs me $10,000 if I go against it. So I just quit doing that. This is the Dave Ramsey Show. We'll be right back. It's an Entree Leadership Theme Hour.

This is the Dave Ramsey Show. We're taking questions from business owners, business leaders. Phone number is 888-825-5225. In the business space with us is the Business Boutique brand, equipping women to make money doing what they love. Christy Wright and 3,000 ladies will begin a conference tonight at a complete sellout. And it goes through down into the weekend. I'll be over there tomorrow speaking and hanging out with these ladies. Also in two weeks we have 15 seats left, the Entree Leadership Master Series, November

3rd through the 7th and it ends, if you want to do an add-on, you don't have to do the add-on, on family business. I'm going to teach all day on family business. The last day was some of the research we've been doing from family business and some of the conclusions we've come to on how to properly do and do and run family in business. It's a lot of fun. And of course, the Entree Leadership Summit is the big dog. It's in every May. This year, it's May 17th through the 20th in Orlando. Mike Rowe, Damon Jodd, Carly Fiorina, Craig Groeschel, Benjamin Zander, Cat Cole, Chris Hogan, Christy Wright, Ken Coleman, and me, plus others.

It's a game changer. If you want to learn more about that, text the word Orlando to 44222. That's Orlando to 44222. Or you can call the Ramsey Concierge team. They'll help you with either Master Series or Summit in May. The phone number for us here for those guys is 888-22-PEACE, 888-227-3223. In the lobby for Business Boutique this week is Renee, and Renee's going to be presenting there at one of the breakouts and has a question.

Hi, Renee. Hi, Dave. It's so great to be here in your new building. It's beautiful. Thank you. I am curious. You've been a business owner for decades. I'm sure there has been natural plateaus in your business. And I'm an accountant, so I get looking at the numbers, you know, gross income, net profit. I'm curious on as you experience plateaus in your business, what did you do to overcome that and what did you specifically focus on? Well, what we've done is generally the business has been wide enough, meaning that there's

different areas. There's high school curriculum, there's Financial Peace University, there's Smart Dollar for Corporate America, there's the whole. There's high school curriculum. There's Financial Peace University. There's Smart Dollar for Corporate America. There's the whole Entree Leadership brand. There's the whole broadcast section, this stuff that you're listening to. And so we've had enough different areas that if one of them gets the flu a little bit, the others kind of keep trucking. So it's not as big a thing. But if one of them, it's typically not the whole business,

but if one of them is struggling, we dig into it and we just start saying, okay, what are we missing here? What's broken? Obviously, there's a need in the market or we wouldn't be here to serve it. And how are we not serving our customers? Because our belief is what Ken Blanchard says, that profit is the applause your customers give you. The natural result of helping people is you make money. If you're wise about how you design your business model and your product lines and so forth.

We're not doing it to make money. We're doing it to help people in a way that makes money. And so sometimes we miss that. Sometimes we have a bad product design, the pricing's off, the way we're delivering it, everything's shifted to digital and smartphones, the way people consume data and content has changed dramatically in the last five years. I had a million podcast listeners 36 months ago. I've got 7 million now, just to kind of give you an idea how much the digital space is

moving and the on-demand consumption of content. And so what we're doing is we analyze that. Sometimes we find that the business has outgrown some of the team, maybe even the leader or one of the leaders. And it has not been unusual that a leader moves or is repositioned or leaves, and we put a different leader in, and the thing takes off. I am amazed at the power of leadership or lack of it in an area. The second thing I found is that sometimes it's completely my fault because I run the freaking place. So if there's something wrong, it would be my fault by definition.

And what that means is that our perception of things has not grown enough because I'm the problem with this business. I'm also the solution. And so what am I not growing? What am I i not understanding are we doing too much tactical thinking old days i was just tactical i gotta make payroll on friday i couldn't spell strategic and i spent all my time now on strategic things getting up above the problem the tactical stuff is just about all delegated from a business perspective around here so what that that's saying is that I had to learn the functions of the C-suite, the CFO, the chief people officer, the CMO, our chief marketing officer. Those people started adding more value than those of us that were leaving the cave,

killing stuff and dragging it in. And so we've done a shift from the tactical over to the C-suite in terms of how we function, and that's just been how we had to do it to get it done. It sounds a little technical to answer your question, but it's really what's happened. And that goes all the way back to we got to 75 people, and I didn't have a CFO, and I didn't have an HR director. And I was late.

I was probably several million dollars in revenue and probably 25 people late at 50 I probably should have had both of those I didn't know what I didn't know and when I put them in place it took off again because their functions that they do released all the other people to do their jobs in other words everybody was spending all their time doing hiring now we got an HR director they get to do the hiring and everybody can go back to work. You know, everybody's spending all their time dealing with accounting crap, you know, no offense, but, you know, if you guys, if people in accounting are doing their work, I don't have to do it, you know, and I spend all my time in there.

I can just look at the numbers and see, read the tea leaves and see what's going on. So sometimes it's functional things, sometimes it's leadership things, and sometimes it's business model things that have caused us to plateau. Did any of that make sense? Absolutely. One of the things that I've been looking at mostly is investing in my team members, specifically my managers, and just pouring out love and opportunity to them. And I figure just let it happen.

It will grow and flourish. It does. I do require a return on that investment i don't mean uh in a very uh robotic way or a way where i'm treating people like they don't matter the people matter but in other words if i send everybody and we spend some money on send everybody to an event and they're going to learn something and they come back and there's no difference then why did we do that you should just stay to work you know you should come home with something you didn't have before another tool in your belt and oh by the way you ought

to use that tool when you get home and different people grow personally at different rates and so um uh you know what we're looking at is can you bring the result? And so that's what matters is the result in business. And so when I do pour into folks, I want to see the result of doing that in a return on investment kind of way. And it's not a thing where I just expect people to just, you know, perform. It's just that we expect people to perform. Hey, thanks for being here this week. Thank you for having me.

Sure. God bless. That's awesome. All right. Matt is with us. Matt's in Florida. Hey, Matt, welcome to the Dave Ramsey Show. Hey, thanks for taking my call, Dave.

Sure, man. How can I help? All right. My boss has been in business for 30 years. I've worked for him for 14 and managed the company for the past seven. The plan is to turn the business over to me within the next five. The company has never been on a budget, so I want to know how would I approach him about getting a budget set up without it seeming like the powdered butt syndrome with him? That's a really good question. I would lay one

out. You know enough about it. You're in a you know enough about it you're in a position to take over you're in a major leadership role inside this company how many team members here um we're a seasonal business so during the peak season we have 25 to 30 okay so your office staff's like five yeah we're we do beach service so we go into a warehouse mode in the winter time yeah okay and so um yeah just i would just write one up what you think it is you're going to be running it someday and all a budget is is we're predicting our income and predicting our expenses thereby predicting our profit okay it's just simply driving by looking out the windshield Okay. When I take over, this is kind of how I'm thinking about running this thing, is projecting out our revenues and using that as a motivator and projecting out our expenses and using that as a motivator to keep the expenses down.

Would you look over this and tell me what's right or wrong with it and just get his advice on how to fix it? And then go, hey, why don't we just go ahead and start doing this now? Once he puts his stamp on it, you might just kind of back into it that way. Because you're going to be doing one. You might as well get used to it. This is the Dave Ramsey Show. our scripture of the day john 14 27 peace i leave with you. My peace I give you. I do not give to you as the world gives. Do not let your hearts be troubled and do not be afraid.

The words of Jesus. Dale Carnegie said, if you want to conquer fear, don't sit home and think about it. Go out and get busy. Well, that will be true. It's an Entree Leadership Theme Hour. Dave is with us in Illinois. Hi, Dave. Welcome to the Dave Ramsey Show.

Hey, how are you doing, Dave? Better than I deserve. What's up? Great name you have there. I'm officially moving into the second generation of our business. So January 1 next year, I'll be 100% business owner. Wow. our business. So January 1 next year, I'll be 100% business owner. And my dad and my uncle, identical twin brothers, started the business in 1992. And they will be just basically moving into

a sales role until they decide they want to get out. So they work for you. Yes. Yeah. And we have a great family dynamic, so I'm more worried about moving from a sales team of owner salespeople only to a sales team of non-owner salespeople, just people not with our last name. So I know you're actively working through that with your Ramsey personalities, and at some point you hired a person to sell for you so what what are the things that uh you feel like set you up for success when you brought sales people on that weren't you and um and to properly uh continue the um the level of what you do from a quality standpoint of dealing with people. My guess is that when it's a family member that you know that they're going to tell the truth,

they're going to under-promise and over-deliver, they're going to go in with the customer's needs as the primary concern, and then the sale is the natural occurrence of all of that. They're going to go in with the customer's needs as the primary concern, and then the sale is the natural occurrence of all of that. Correct. And that's your company values, which means these are really more like servers than sellers. We tell our people don't sell anybody, just serve people. And if somebody does not need something that we have don't sell it to them you know and you know and so you ever been to a really good restaurant when you get ready to order something

and you ask the waiter is this any good and they they go the truthfully no get the other thing no doubt and you trust that guy forever after that right yeah and Yeah. And whatever else he recommends, you just do it. Because once he told you the truth, you're in, you know? He's got your best interest at heart. And, you know, if I ever ask, you know, and I've been to other restaurants, I say, what's the best thing on the menu? And they always tell me the most expensive thing. You ever been there on that?

Well, I just lost my trust. All they're trying to do is make a dadgum tip, and you missed out on how to get a tip from me. The way to get a tip from me is take care of me, you know? Yep. And so, you know, this is how I train our people around here. And so you have to care about the customer like you own this business. And if you screw people, they tell everybody. And you ruin your business, your reputation of your business,

because trust is really all you've got to sell. That's all you're allowed to sell out here. Especially in the construction business where there are terrible stories all over. And so we're not trying to temporarily raise revenues by you lying. We're trying to raise revenues over the long term by having cared for people and done incredibly valuable work and charged less than that, where they want to come back to us every single time. Our work is excellent.

It's on time, and it's on budget. And that's what we want to do over and over and over again. If you don't want to sell that, you don't need to work here. And I've had, you know, I had had one lady here the woman could sell ice to eskimos i swear to god she could pick up the phone and get the president on the phone i never saw anything like it but the woman would lie i mean she just exaggerated you know and one of my leaders said well she's a really good salesman but she exaggerates i said no she lies you know and she gets us in trouble because then she's telling people we're going to do stuff

or we can do stuff we can't do. And we have to come in here and clean. I'm always running around behind her with a pooper scooper. And I don't want to do that. And so guess what? She don't work here anymore. And so that's what you're doing. You just have to train people.

You can get good people that are as good as your family members in terms of their character quality and put them in the seat and then you know let them have the freedom and the dignity to have integrity and to do the right thing for the customer i actually suggest that they don't do something because it's not the best thing on the menu yep i completely agree with that and you know you just have to you have to go through a few to get to that and you're interviewing for that you're not interviewing for their quote-unquote closing ratios and their ability to do verbal gymnastics and paint somebody into a corner and put a gun in their face and then they walk away like a dead gum timeshare salesman or something you know you don't you just don't

want that that's just trashy and it's not the way we want to be sold to you yeah it's not i want to be sold to and we treat it that way i don't want to work with people treat that people that way and i want my company to be known that way and so you're going to do that stuff i don't need you so that if you can just because you can do 16 verbal backflips and you've learned all these techniques doesn't mean squat to me do you love people and will you serve them with our product line and if you'll do that you can fit in on our team and i can teach you to serve and you won't even have to learn to sell you'll never be pushy once if you serve people they'll take your products away from you you don't have to talk them into it. All you got to do is love them and have their best interest at heart.

It's made me hundreds of millions of dollars. Gus is in Arizona. Hey, Gus, how are you? Good, Dave. Thanks for taking my call. Sure, what's up? Is it ever appropriate for a business to have a line of credit? We have a very successful business,

but sometimes our clients, due to their own industry practices, pay 90 days. So all you've got to do is cash flow plan that. Why don't you be your own line of credit? Quit draining the profits out of the place, hold some back, and be your own line of credit. That's what I do. Very good. I got, you know, the publishing business, they pay us in 90 days,

and half the time they ship the crap back at the 89th day so they can start the 90-day cycle over and reorder 10 days later. It's a constant dadgum disaster. Publishing's a stupid business. If you do that, however, you're always going to have profit locked into... That's called retained earnings. But you can't distribute those retained earnings to the business. No, you use them to run your business.

I've got millions of dollars of retained earnings that are not distributed, that are sitting here to cover cash flow fluctuations due to term problems with vendors and customers. And that's what it is. So, you know, you don't borrow into that because if you borrow into that and then that company goes into Chapter 11 and you never see your money, now you know what you got? Debt. Well, they'll not going to Chapter 11.

Yeah, they do. They do every week. Happens all the time. So, no, you need to set aside more retained earnings and hold it into the business to cover that. You don't have any liquidity, man. You guys are running by a string. You're running by a thread. And when you don't have cash, you got no power. Business cash is power.

It gives you stay in power. It gives you the ability to buy out the competitor for pennies on the dollar when they go broke. It gives you the ability to survive a cash flow swing. It gives you the ability to survive a slowdown. It gives you the ability to keep your good people and not have to lay them off because you've got cash. All the time, not going into debt. Cash is power. And it's retained earnings and so we set aside a percentage of our

profits every single month to continually grow our retained earnings as our company has grown and that has kept us in the cash business we do not borrow money and i'm in a bunch of different business lines that people pay us by god when they want to. I mean, we're in 47%, 48% of the high schools in America. That's called a government account. And, you know, guess what? Their payroll is government. Or they're paying bills as government. Sometimes they pay cash on the barrelhead with one of their preset things.

And sometimes it's months before we get our money. And they've already teaching those little people our curriculum before we get our money a long time. And so it's called retained earnings to make that run. Amen. Thanks for the call. That puts this hour of the Dave Ramsey Show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace,

and that's to walk daily with the Prince of Peace, Christ Jesus. This is James Childs, producer of The Dave Ramsey Show. Once again, you made The Dave Ramsey Show one of the top five most downloaded podcasts last year. To get your daily dose of motivation and inspiration, subscribe today.