Episode #0034 – Michelle Cooper’s Seven Key Points to Analyzing the Health of your Business

Featured in this week’s episode of The Productive Designer host Crystal Collinson with entrepreneur and owner of Alchemy Accounting and Bookkeeping Services, Michelle Cooper. 

Michelle is an author and business owner who helps businesses create profit and lift themselves out of poverty. She discusses how she went virtual in her work over the years, but especially when COVID hit. Shifting to work virtual has allowed her to work with people from all over the world and support others in all aspects of their bookkeeping and analyzing their business needs. QuickBooks has been instrumental in helping Michelle stay on top of her business in assisting others with their needs. 

Michelle also has her own blog with a multitude of advice for businesses. Some of her best advice is teaching others how to turn a profit instead of letting their bills and expenses take control. Michelle has seven key points to help you in your business endeavors. 

  1. She starts by taking a look at your mindset to find what you are truly saying about yourself and your business subconsciously. Start by clearing your mind of the negativity your subconsciously thinking about your business. 
  2. What is your profitability on your price point? 
  3. Where is your spending going? Who are you paying and what are you paying for? Must Haves? Convenience? What is this? 
  4. Where are you discounting your services to get clients? 
  5. What is your team doing and where are their hours going? 
  6. Developing important and better relationships with your vendors. 
  7. What is your client’s lifetime value? 

So, join Crystal and Michelle as they talk about how Michelle can improve the mindset of your business, and how you can turn a profit on your business. And then, do something today that your future self will thank you for and listen to this episode of The Productive Designer. 

How to reach Michelle:

Website – alchemyaccounting.ca 

LinkedIn- michellebcooper  I Facebook- businessamongmoms

Michelle Cooper as guest on TPD with episode Seven Key Points to Analyzing the Health of your Business

Recommended podcasts:

Mind Your Business, Run Like Clockwork and Real AF

- Click here for the RAW, unedited transcript -

0:15
Welcome everyone to another episode of The Productive Designer today I have Michelle Cooper, she is a powerhouse entrepreneur, CEO of Alchemy Accounting and Bookkeeping, author of Confessions of a Money Rockstar your money date journal and co author of the collaborative book Women Rising. Michelle supports the growth of her clients business with real strategic planning, while also addressing the mindset issues that arise with growth in order to bust through and rise up to levels. They never dreamed up. The team had alchemy, accounting and bookkeeping support clients across North America and into Mexico and South America, as so many entrepreneurs go virtual Michelle has helped many business owners climb out of entrepreneurial poverty and into the land of profit welcome Michelle,

0:56
thank you so much. I am very excited to talk to you guys today. And thank you for having me crystal,

1:03
well this is exciting I there’s so many I have so many things here I just I want to know how do you work with people in other countries like how does that work for you from I guess from, obviously there’s different tax laws and how has that developed because I know how I work with my bookkeeper in accounting and I think okay how can I make this 100% virtual so tell

1:21
me a little bit about that.

1:22
Yeah, well, you know, so many businesses are going virtual, And so many entrepreneurs are, you know, becoming kind of like digital nomads or, you know, that kind of like laptop lifestyle kind of thing. And what I noticed is that when I was speaking at entrepreneurial events in Canada and the United States. Quite a few people were like ex pats living in Mexico, or Costa Rica. Right, right. And so, what, what I ended up doing like, you know, they needed support, and I develop the team. Like I cultivated a team of professionals that can support them. So I don’t I can’t be the expert in every single situation, for sure, but I do have some really really great people on my team that can support people and know exactly the legislation or their situation what they should be filing in regards to supporting people with bookkeeping is pretty easy these days, right yeah with the use of QuickBooks Online or other software and Dropbox and firewalls, it’s pretty easy to to make that completely virtual,

2:40
right. So do people like just no like I’m thinking logistically like when I have all my invoices and my receipts and stuff and I have them like are they scanning them in and sending them to you is that kind of how it works. Yeah,

2:49
so, so QuickBooks has an app, which basically you can take a picture of a paper receipt. Okay. And then that records the receipt so we asked the client to do that, we’ll allocate it, but at least there we have a picture of it, and the IRS and the CRA, the two government authorities. They will now accept digital records they didn’t used to do that but they will know things like email receipts and stuff like that, we have a system in place where basically the client forwards the email,

3:21
and it’s recorded

3:23
by my staff saved into Dropbox for them and kind of like a little bit of a concierge kind of service, and, and that way it’s all taken care of.

3:31
That’s great. Yeah, cuz I was just thinking, I mean I know when I take my receipts I put them in a file like enough mental thing and I just collect them and then every quarter I give them to her and she lives very close to me but, no, that’s great, that’s what was, those are my questions I think you should do that with the receipts because it wouldn’t be labor intensive on being the client to have to scan them all in but with having an app like just to take a photo it’s much easier.

3:55
Yeah, yeah, I mean you know sometimes say somebody hasn’t kept their bookkeeping records up to date and they have a year or more of receipts. What we’ll often do is say, put them in the mail to us and we’ll figure that piece out. Like, I’ve got staff who can, you know, scan things at a kazillion miles an hour and we can take record of it right. Yeah. You know, like our goal for 2021 is to be paperless. Yeah, I don’t know if we’ll reach it,

4:26
but it is.

4:28
That’s our goal to be completely paperless, it makes me nervous because even for my own records I’m like printing stuff to myself or like I thought it was supposed to be paperless I’m like oh yeah just ignore that.

4:40
That’s,

4:42
that’s me and my hang ups, not anybody else. No, I know I’m the same way I mean I still feel like I print stuff like I don’t know, is there something tangible that I go kids and it’s physically in that folder I know as opposed to it being digitally in a folder so yeah I get it I get it but, so you have a, I guess we’re gonna talk a little bit about seven, brilliant ways to increase profits without killing yourself. I thought this was a very appropriate topic for my audience who pretty much predominantly exists, solopreneurs small business owners, and as we know when we are those, we wear all the hats, and I’d love to hear your expertise on this.

5:22
Yeah, well, you know, one of the things I found was that business owners like we especially when we’re at the beginning stages are what I call this start phase which is kind of like

5:35
zero to about

5:36
350 $400,000. We’re wearing all the hats. Right. And so we can often just lose track of, like, the actual profit that’s in our business, and that’s the most important number right like that number is, what, what you get to keep as a business owner, right, like that’s your money. Yeah, and business owners can get really really caught up in, like in the top line revenue number. Right. And, and, you know I want a six figure business a seven figure business, all of that kind of talk, and there’s really no like there’s no point in having, you know, a million dollar business, if you’re making $1 in profit.

6:27
Exactly. Yeah, exactly. If you got a million dollar business, but you have 900 and something 1000 in expenses and costs, then, yeah,

6:34
you’re not like there’s no real point to it right. And, and what I found when I was working with more and more business owners is that they didn’t, they didn’t have a significant enough profit to sustainably support the business, and sometimes they had no profit at all, and often they weren’t paying themselves or paying themselves enough. And what can happen is that they start to build resentment towards the business. Oh yeah, absolutely.

7:02
You’re exhausted.

7:05
You know, like you’re putting in all this work. And what do you got to show for it.

7:10
Yeah, you’re like, I could go work at Starbucks and be checking checkout and probably take home the same. Yeah,

7:18
and I literally had in the early days of building my business I literally had a client who was in that position, and she was like, either you figure this out and tell me what to do, or I’m just going to go work at Starbucks. Yep, think about

7:35
this point. Yeah, exactly.

7:37
So is there is there seven steps, or seven items like let’s let’s, let’s bring this down.

7:44
Yeah, so one of the first thing I tell people to, you know, consider, is looking at your mindset like looking at your thinking. Right. And, really, like, what do you feel is your thoughts around creating a profit, your business. Do you are you are you operating from a place of, it’s really hard to create a profitable business I never have enough money. There always seems to be too many bills like what, what’s that dialogue that’s going on inside your mind because the mindset piece is like the foundational piece of where we start. Right, and clear that out. So whatever methodology you adhere to or you believe in, whoever you follow in regards to mindset. That’s the most basic place to start. And we can do this by either being still or silent or some people like to, I personally journal. And when I think about something like profit. I just listened to the internal dialogue that comes up. Right, so what is that subconscious talk that oh well you can’t have that much money, or, no, no. That’ll never happen, Or, or, that’s gonna be super easy like what happens,

9:03
right. It’s the money story right that they talk about,

9:06
yeah it’s total money story right clear that up, the other. The second piece is to look at your profitability on projects like what is your profitability on your price point. Right. So, especially, you know, for your clientele. They’re probably operating on a project by project basis, right, something like QuickBooks Online, you can enable projects, which is very useful because you’re able to allocate income and expenses directly to a project, and run a profitability report.

9:42
So you get the numbers very easily from QuickBooks, if you’re running project accounting. Okay. And, and that’s going to show you, like, you know, when you say you build out on a project to build in 100k, and your cost of fulfillment of that project like the, the costs that are directly involved with the fulfillment of the project are $50,000 I’m just making these numbers, universities, the math right, so you write a 50% profit, like gross profit margin, what I call that number that’s left that 50k that’s left, that’s your real revenue. And that’s what you have to pay yourself with,

10:24
and all of your overhead.

10:27
And it’s a really important number to understand. So looking at your pricing looking at the profitability of projects where a project’s perhaps going out of scope is another place to look at, right, and why, and really getting a firm handle on that. Usually, when we look at that, we see that there’s an capacity to a increased price point. Right. Often when people are in a start or grow scale phase of their business, they can bump their price up a little bit, and then the third one is really to look at your spending. So I talked about doing a spending audit. So this is examining where your money is going. Who are you paying. What are you paying for. I categorize expenses into three categories, when we do a spending audit with clients, and the first one is, I absolutely have to have this to do my business. Okay,

11:25
the must haves. Yeah,

11:27
right. So, must have could be something like zoom, could be something like, I don’t know some software you need to like AutoCAD or something like that. Right, have to have it. The second category is, it’s a convenience, so it might save me time. I could not use it, but I use it. And then the third category, which is always the one that gets people is, I don’t even know what this is.

12:02
Exactly,

12:03
yeah. Yeah, and when I say to people is if you’ve used this for three months that you need to get rid of it. Yeah, and you do a spending audit by just like you’re just gonna pull up your bank statement your credit card statement and go through it line by line for your past couple months, and you can take a highlighter or whatever works for you. And just look at your spending. And often, people can save 1000s of dollars, just by doing that, which is going to increase your profit margin.

12:32
Yeah, and when you’re talking about that it’s, like, right now there’s so many apps that we can have subscriptions to, and they can be $7, and $8 a month and you’re like, well, that’s nothing. But if you’ve got 10 of those, I mean, it can just those little things like where they call that the the coffee isn’t there like the latte factor or something where they’re talking about your spending. Yeah, yeah, like the $5 or whatever, but those 678 $10 $12 a month, apps, to your point, if you’re not using them, then they’re your absolute, you know, waste in an expense that is not needed. Yeah,

13:05
yeah, absolutely. So that can really help increase our profit margin. Right. Yeah, for sure. The fourth one is around discounts or kind of like deals, you know like, where are you discounting your services. In order to get the client.

13:24
Well and and designers decorators designers are notorious for this you know we are the people that are, You know, especially if you’re doing hourly, even if you are keeping meticulous hours. There’s so many of us, I don’t do hourly anymore but so many of us would be like, oh I can’t really charge them. I can’t, I can’t really invoice them for all the hours I’ll just take them off. Right and you because it’s you have a mindset issue with that right and then, yeah, you know, now that they’re older, they’re gonna freak out if they see that it was you know 35 hours last month. So yeah, big time on that for sure.

13:57
Yeah, and that to me is a, an indication that they need to move out of hourly pricing for sure, right, if you feel like you know I believe in value pricing for sure, but you know sometimes people, you know, it’s, it’s just inevitable you just have, you have to charge by the hour for some thing, but if you find yourself going, oh I can’t charge them the full, you know what we longed for time, then you need to move, that’s like firm indication need to hold value pricing, or at least set fee pricing, and you know I see that I remember years ago in my bookkeeping business where we were, you know at the beginning charging by hour, and, and it was like, Oh, that feels like a lot, Exactly, that’s what they weren’t, that’s just

14:43
it’s overinflated, it’s always under estimated for sure because we forget, you don’t necessarily keep, you know, you think you keep really good at but you’re never 100% accurate. And yeah, so it’s always underestimated for sure, and then you’re taking off that too.

14:59
Yeah, totally, totally. So, you know, looking at that, looking at, you know, perhaps, if you’ve got a team. There’s somebody working over time, like that’s that cuts into your profit margin, where you know you don’t scope for overtime, really, what is the expense, What’s going on, where are we, incongruent to what we had scoped to this project. Right.

15:23
So how do you how do you recommend with clients that are on projects like, like we are, how do you sort of get a handle on. I guess just making sure that that they are encouraged to, to what we’re charging, Is there any tips or tricks that you have on that.

15:38
Yeah, well, time tracking time tracking time tracking time tracking. One of the things that I do with my team, besides our time, you know like we have time, kind of logging software, right, because even though we don’t charge by the hour anymore. I still want to know what the team are working and how long it’s taking them right. And if we, it’s a good measure if we go out of scope. But besides that, having your team, track their time, even just on an Excel document or a Google doc like quite granular what are they working on, you’ll start to see where they’re working on things that aren’t relevant to a project, or they’re working on somebody else’s project. Now that’s out of scope right they weren’t, they weren’t included in that scope or like some anomaly will come up. And that’s a, it’s a really good thing we do quarterly time tracking as a team for three days out of the week, and we just use a Google Doc, and it tells us so much information. Yeah. And you know you’ll get senior staff who are working on things they shouldn’t be working on.

16:50
Yeah, exactly, like that’s not your best use of your time value is not there.

16:55
Yeah, yeah. And, you know, just measuring, right, measure, measure, measure of Penny thing

17:01
that makes sense. Absolutely.

17:02
So where are we We’re number five. Number five, looking at your team, this kind of leads into what you were saying, right, looking at your team who’s doing what. Is this the most valued use of their time. Do you have senior team members who are doing junior team members jobs, Or vice versa, right, like, what’s, what’s happening, doing an audit, as well, about, like, the people on your team. Are they revenue generating roles are they overhead roles, or how much of their role is revenue generating versus overhead. Yeah, He got it you really got to manage that, especially if you’re trying to grow a business in the growth phase of business, it’s very easy for your payroll to outpace your profit.

17:53
I can imagine.

17:55
So is there an zero magic favorite kill you, like that you would say what percentage that yeah,

18:00
30% should be your payroll, and that includes your admin, and your fulfillment, including all your taxes shouldn’t go over 30% as a really rough guideline. Okay, so if

18:15
you were looking at somebody as a staff member if you’re thinking of bringing somebody on how would you determine, like especially if it’s an admin person right that’s going to be maybe ordering, placing orders for several projects right so they’re they’re brought in for, you know, maybe four or five different clients, and so they’re doing some admin for for each client, they’re doing some correspondence there was You’re clearly not revenue generating How do you know when you have the, the income to do that or when, how do you know when it makes sense I guess what I’m trying to ask.

18:47
Yeah so, looking at your financials, looking at your profit margin, understanding how much you need out of the business as a business owner.

18:55
Okay,

18:55
and what amount of revenue, do you need to bring in to support that person. So, you know if it’s a $60,000 a year role, I don’t know. What does that mean for your business, right, so what’s the total cost of that person do they get benefits, taxes, all that kind of jazz, right, and what would be the breakdown of their work, like are they 5050 overhead and project work. So you know, project work you know you’re charging them out. Right. Are you charging them out. What are you charging in the mode is it double is it triple what their what their salary is, if it’s, if you know that their charge out rate is 50% more and they’re doing 50% kind of admin overhead, you know, you, you broke even on that person. Yes, okay. By charging them out. Gotcha. So it’s a little bit of analysis and getting into more of the granular numbers of your business but totally doable, like, really easy to figure out,

20:04
Okay. Alrighty, and number six.

20:07
Oh my goodness. Number six, looking at your vendors, right, like where, where can you negotiate better pricing, reduce freight charges. Where can you consolidate vendors, you know, is there somebody if you did all of your business through one can you get a better deal kind of thing, really trying to develop important relationships. Totally. I call it kind of like relationship capital right like, for

20:35
sure. Yeah, exactly. I mean, even with even just from a sort of very basic level, it’s like okay well I’m trying you know I’m trying to outfit a house or something like I try to minimize the amount of vendors, because of just logistics, and then secondary if I’m, you know, shipping, just basic shipping charges because it’s coming from six or seven different vendors, whereas if I could narrow that down to half, then, yeah, so it’s the small changes. Sometimes it’s not easily done but, but you’re even negotiating better discounts with them, I’m sure.

21:06
Yeah, absolutely. Okay, number, number seven. The best one yet.

21:14
Hopefully the best for last.

21:15
Right, looking at your client lifetime value.

21:19
Okay, so

21:20
what is the client journey for you. Right, they come to you with this one project, is there a follow on service you can provide or. And how long does that take how long do clients normally stay within your business. Is it a one and done, or is it a lifetime or somewhere in between. Right Understanding your clients, kind of like habits and their journey with you. And what we call client lifetime value can substantially help you increase your profit margin, because you might identify a gap, and you could create a product or service that would fill that gap and extend the total value of that client to you. Right,

22:09
how would you determine that he’s like say, Most of the designers do typically residential so your, you know, besides doing Mr Mrs Jones his living room and kitchen, and then hoping in the next, you know, one or two years they’re gonna do it faster and, like, what are some, like, are you saying things like, offering. I know I wouldn’t say Landscape Services but in Canada we only compete that a few months a year but like what would be some of the examples.

22:32
Yeah, so you could think about like complimentary services that you could offer or or partner with to bring under the umbrella of your company, you could think about, like, like kind of like refresh packages or, you know, another great thing is, we have a couple of clients that are interior designers, and when I was last year, when I was chatting with one of them, I was like, have you checked in with these clients. I know they said they were going to do their home theater, and then COVID happen and you know blah blah blah. I was like, have you checked in. No, I just figured they call me.

23:11
I’m like no,

23:12
let’s build that relationship. Yeah, yeah right. Yeah, build that relationship stop by. See them ask, like, don’t be afraid to ask like hey and and make it relevant like no one’s going in the movie theater, have you decided to do your home theater now right like can we get started. Yeah, propose work to them.

23:33
Yeah, and I don’t think many, many would think of that right many would think to propose in its, but I think keeping in touch I think is crucial right just keeping top of mind, you know, staying in touch with them, because you never know, right, you just never know where the next job, or keeping in touch with them even if the Mr or Mrs Jones don’t necessarily have but maybe their friends do or their neighbors do are totally referral referral

23:55
referral. That’s like, I built my whole business off of referral. We’ve never advertised I still don’t advertise, and we have new clients coming all the time, but I think referral, it’s just such an easy way to expand your profit.

24:13
Yeah, it cost you X amount to get that client but it’s like a third or whatever it is to keep them so to speak, right.

24:21
Totally, totally. But the idea of proposing work like, Have you thought about doing this, or do you think it’s time to do that, or because what I find, it doesn’t matter what you do what industry you work in the client doesn’t really know what they need, what they can’t why they’re varying yeah like they don’t end up there like I don’t know, is it time to do that or not, right, like it doesn’t matter if you’re talking about renovating a bathroom or, I don’t know, getting a new furnace like,

24:51
I don’t know if you need that or not.

24:53
Right, but an expert will.

24:56
Right. And it’s planting the seed,

24:58
it’s totally planting seed and what, what often happens is people come back like you could be like, oh, you know I was seeing there’s, you know, we could totally pull your bathtub I would do this and that and whatever right I don’t know. And they might be like oh yeah no, I’m not really ready for that or whatever, and then they’re thinking about it. Yeah. Right, right.

25:19
We planted that little seed and then you’re just like let them go away and all of a sudden, you know, months later, they’re like, Yeah, you know, did you mention that, yeah. Yes, that’s a good way to do it. So, you’ve said you haven’t advertised, is there a certain like to get your to get clients is there certain niche that you work in. I know that you are a fellow Canadian on the West Coast right Yes, excellent. So I can say Nish to you and you

25:44
know what you’re talking.

25:46
Yeah, so how are you finding that like, what’s your clientele look like.

25:50
Well, I think that what we really excel at is supporting consultants. So people who are providing a high level of service and our specialties seems to be evolving, more and more into those businesses that perhaps need a little bit of catch up a little bit of cleanup sometimes a lot, they might have, you know, outstanding filings for taxes and things like that, like, will, will still take somebody who’s, you know, all up to date and current, but more and more we see people are deciding okay you know what this is going to be a priority in my business, and I’m going to get my shit together. Basically, and we’ve developed a great system of catching and cleaning up clients records, pretty quickly, while also getting them on a monthly service, because what I used to see out there in the marketplace or still see now, really, is that people will try to catch up and then not I’m not working on the current record keeping, right at the same time, which kind of makes any or sense right, but then you’re always kind of catching up.

27:12
Yeah, you’re never, you’re never proactive you’re just reactive.

27:15
Yeah, yeah, and it’s a long drawn out process, it feels really painful and gross. And we’ve managed to create this really amazing system where we can get a client caught up like current right now, and we’re still working on the old records. So, you know, it depends how much they got to catch up on.

27:36
So,

27:37
that’s worked really well. What we really stand for is impact driven businesses. So, really an entrepreneur who cares about their impact in the world.

27:49
Okay, so, what type of services, yeah, yeah I was gonna say like how do you work with clients because obviously you do bookkeeping and accounting but is there is there different levels is there different, because everybody’s needs are going to be slightly different. So can you tell us a little bit Oh totally,

28:03
totally. We have some clients, you know their basic level where we’re just doing monthly bookkeeping and, you know, making sure the records are neat and tidy. Everything is allocated correctly, they get them up and report, and they’re all good

28:15
to go.

28:16
We have clients that were basically their accounting department. We pay bills for them. We chase receivables, you know, we do it all we are their virtual accounting department, which is really really useful when you get busy and then use that, like cash flow becomes as a whole nother podcast. Yeah the cash flow becomes a really important thing to manage right. So, and it can be really affordable to outsource an accounting department, and pretty easy to do. And then we also provide like I provide fractional CFO services so more kind of advising and consulting. Okay, looking at analysis projections, and that’s where the cash flow management comes in. Yeah, yeah, to make sure that you know there’s enough money for everything. And then, you know there’s taxes, right, obviously, taxes,

29:09
there is depth. What does it say the two guarantees whatever. Yeah, yeah,

29:15
yeah, so we’ll make sure that that’s our kind of compliance work where, you know, we’re, we’re making sure that everything is filed, it’s all up to date and accurate.

29:25
People all caught up.

29:26
So I read you are a your Profit First certified or whatever that you’ve done a profit first professional Yeah, professional Yeah, so I started reading the book or listening to the book the audio. The audio book and

29:39
tell me a little bit about that because that,

29:40
I just I get very excited about it and then I got to the implementing stage and I went, I don’t know what to do here and I stopped.

29:46
Yeah, yeah, you know, it’s funny, that’s what happens right and that’s why there was Profit First professionals for that exact your exact experience. Yeah, I read Mike’s book, probably, I don’t know maybe six or seven years ago, and I’ve made, like in growing my business or creating my business, whatever you want to call it. I feel like I made every mistake that there was to make, I pretty much did it, and one point, I was so busy growing my business and focusing on revenue and client generation that I lost track of my expenses, and I had a business that was costing me, just to keep the business open $22,000 a month. And I was like what is going on like, there’s no money for me, and I had lost track of my financials because I was so busy in the business, and I figured I gotta figure this out, like, Yeah, this is crazy. And there’s so much shame involved in that right out here I am and I’m accountant I own an accounting and bookkeeping company, and I felt like I was treading water. And I found Mike’s book it came as a recommendation from a coach that I know and who was actually a client. And so I read it, and I was like, well, this just seems so easy. Yeah, like, yeah, like I don’t Is this gonna work like seems too easy, but I was at the point where it was like, either. This works, or, I can’t keep doing this, I just got to close this business right yeah. And so I implemented it and like I saw an immediate benefit, like, immediate, like I did the spending audit. I like I cut down a whole bunch of expenses I looked at you know where my money was going where it was coming from. I also incorporated it with one of his other book called The Pumpkin Plan, right, which is about looking at, you know, your client categories. And then I was talking, I was at like a CPA. I don’t know, continuing education thing or something like that. And I was talking to some accountants and they were like,

31:57
Yeah,

31:59
you can’t, you can’t do that like it’s not really counting, and I was like this this book just saved my business like what are you talking about. Yeah. And so I looked further into, Mike, and what he was doing, and I saw that you could become a prophet first professional like you could become certified in this. Yeah. And so for me, I you know I do like to kind of, like, follow the rules, sometimes, and no you

32:27
don’t, I can see behind you. You can’t see but she has a, be legendary blank average

32:36
starts with an F and ends with the kicks.

32:39
I don’t like to use other people’s work without their permission, at least right. Yeah, and so I looked into I was like I’m gonna do this because I think it’s really useful. What I do find is that not a lot of accountants, like it because it is so simple, and it kind of leaves, sometimes alleviates the need for somebody to pay a whole lot of money to an accountant. Good, what can happen is people read the book they try to do it, there’s all these different accounts there’s money flying back and forth, they’re in high stress anyways. And they just can’t do it on their own and they can’t manage it, They can’t match that and

33:19
their business. And that’s so is that something that you offer as a, I don’t know if that’s doable like is there a separate like service that you could get somebody on that. Yeah, okay.

33:29
Yeah, absolutely. I call it like a profit first implementation. It includes like a profitability analysis, and we really get clear on cash flow, understanding projections for business as well. Yeah, and then working with a client like literally being on zoom with them, will they do the transfer of the percentages. Yeah, to make sure they get done, we can be great because what usually is the number one concern is, is there going to be enough money. Yeah. Like I just don’t believe there’s going to be enough money, and they need some hand holding. To show them there’s enough money. Right, so it’s quite intense at the beginning, you know it’s weekly calls and it’s a lot of hand holding a lot of support at the beginning, and then we scale it back every other week, and then, you know, after six months, it’s kind of like once a month. Some clients like to stay on. Yeah, and just have that once a month call and we’ll do quarterly check ins or maybe bi annual kind of like deep dive into stuff. It’s a really useful service. And if you’re a fan of the book and you haven’t been able to implement Profit First, working with a profit first professional will get you like it, you’ll get it implemented, and it will work.

34:51
Yeah, like,

34:52
I’ve never seen anyone who has fully implemented Profit First and it hasn’t saved their business. That’s

34:59
amazing. I mean that’s, that alone because, as I said I was reading, you know, listening to the book actually it’s very good to listen to it because He’s quite a character I have to hear Him speaking I did, and I was I was very jazzed about it I even bought the book and then as I got to that exact point where I went, oh I don’t even know like I started the spreadsheet and that was just Yeah, and then yeah, business you get too busy doing what it is that your business is. And, yeah, it’s just falls down the wayside like social media and all those other should be doings and, you know, unless you hire somebody.

35:32
Well yeah and you know like I call it with my clients, I call it a CEO date right it’s or, like, you know board meeting kind of thing like I’m your CFO we’re sitting down at the board table boardroom table, and we’re talking about the financials and that’s all it is, there’s no judgment here there’s no anything, there’s just as looking at the numbers and part of that is for us to look at cash flow would that’s the biggest part of

35:58
our business is this. Not that I’m by no means an expert in that but that’s always the story of what’s coming in and what’s going out right it’s just,

36:06
you know, it’s interesting writing books and there’s like this small business administration in the United States did a survey, two years ago and 90% of businesses that did close had significant revenue but they closed because of cashflow problems. And that should tell people how important cash flow is like I see businesses all the time, especially service based businesses where they’re giving people terms for payment. I see them have significant contract values and revenue coming in, but because their receivables are out of scope. They do not have the cash flow to support the business. Yeah.

36:45
No, and that’s just it, it’s it’s because it’s a service right I think people feel a service isn’t a tangible and and I haven’t shipped you the 100,000 widgets, but I’ve done all this work for you, it’s an intangible, right, right, no yeah, let’s do it that’s that’s pretty sad statistics, actually, it’s,

37:04
it’s not a good thing and, and it’s a real, it’s real. Like it really happens, and it’s,

37:11
It’s awful to see.

37:12
I had a clan, too, as a contractor, and he was, he gave his clients like residential clients not even commercial 60 day terms, and I’m like, do you understand that you have to pay your staff every two weeks.

37:30
What about all the materials and

37:31
supplies. So this might not get income from, like, but I need to give them this, these terms in order to get the business, I’m like, You’re gonna bankrupt yourself.

37:40
Do you need the business that much. Yeah. Because, again, we’re not a charity. Right.

37:48
Yeah, it’s, it’s, yeah, wow, so you don’t go into like Safeway and say oh I need two months to pay for my milk, like,

37:57
I’ll get it to you I promise I’m good for it, yeah. Yeah, but again you’re going to jail. Yeah, you pay for it now or you don’t have it. Yeah, and I think, again, like we’re saying but being a service based business, and if you’re doing, especially when you’re working with residential, there’s a difference when I find working with most of my clients are more commercial builders, so it’s a little more black and white, I mean it’s not any easier necessarily to get the money sometimes they have their terms that are different, but I think there’s something with us with working with homeowners and residential that more personal residential that there can be a lot of hang ups on asking for money, you know is that, oh I shouldn’t charge them the full 35 hours it took me to do it I’m only gonna charge them 25 Like no, no, we’re in a luxury business right like people, we are not in necessity right we are not in essential circus COVID language we are not essential right i mean you do not need our services you want our service, it’s a luxury. It’s a nice, it’s a nice city.

38:56
So you got to pay for it. Yeah, and I think that comes with, you know a lot of times comes with just competence and time in business too right that you realize that, wait a minute, you got to pay for this. So,

39:07
so at the end of every episode I’d like to ask my Interior Inquisition questions, and so this can be about business life, whatever. So what is the one thing you think every person should experience in their lives.

39:18
Oh my goodness. Well, I think adventure and adventure means whatever it means for you. For some people adventure might be whitewater rafting down this MBZ, for others it might be going to Edmonton. I don’t know.

39:34
It’s a really bad option, sorry I

39:40
yeah, I think adventure I think it pushes us outside our comfort zone, and it enables us to grow in so many different aspects.

39:49
For sure, for sure. What’s the wisest thing that you’ve ever heard someone say,

39:53
Oh, I love this.

39:53
My favorite quote which is by Raymond Charles Barker, who wrote the Power of Decision. He said true prosperity is having the money to do anything you want, and the time to do it whenever you want to do.

Published by theproductivedesigner

Crystal is the principal of Crystal Collinson Interiors, a full-service design firm specializing in the Design and Decorating of Model Homes, Sales Presentation Centre’s, Condominium amenity spaces and small commercial projects. Crystal & her builderdesigner team work with many of the GTA’s largest home builders.

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