Predictable Profits In Your Business with Charles Gaudet, #EEP Entrepreneurship Podcast #274

Hey, you know, there's an event that you should go to. You know, every year you look at the different things you should do, and then you don't do it. Well, here's one event you should go to, and I'm insisting you show up. It's Profit First Live. We hold it right here at our offices, and what we do is we teach you. I teach you how to permanently drive profitability in your business. Now, if you read the book profit first, you got the starter kit, but the question is, are you doing it right? Well, I'll ensure you do it right because I'm going to work with you personally, along with our team here, for two days and drive profitability in your business. Go to profitfirstlive.com right now and sign up for the next event. You know, you should. I'm telling you, you must. All right, I'll see you there. Strap on your rusty cake. We're about to discuss. I know. We're about to discuss predictable profits and so much more. On today's episode of Entrepreneurship. Elevated. Sounds like a police car. Oh, I got an interesting police car story for my Pat Bantaur concert.

Can we have Jeremy tell his interesting ticket story, too?

Yeah, I do. I want to hear that. My name is Mike Michalowicz. I am the author on a mission. Mission to eradicate entrepreneurial poverty. You know what entrepreneurial poverty is? It's the outside perception. Oh, you're crushing it, dude. And the reality is you're struggling, dude. Well, we fix that on this show in every show we do and throughout my books. I'm also the author of Profit First, Clockwork, the Pumpkin Plan, and brand new book Fix this. Next. You can get a pre order on Amazon right now. Hopefully by the time this episode goes live, actually, the final book cover will be up online on Amazon. I'm joining studio with my friend who I just love to banter with and get in arguments with Kelsey Ayers.

Hello, friend.

You can find us on itunes too. Stitcher, Spotify, iHeartradio, TuneIn radio, any podcast or anywhere.

And also in studio is Jay Kablone.

Hello.

So I asked. I asked you, Jay Shablone. I said, hey, does anyone from your family listen like your brothers or any friends? He goes, no. No one does. And he goes, except for my mom. So big shout out to Ms. Pat Smith.

There you go.

Pat Smith.

Yeah, she'll be. She'll be smiling and laughing right now when she's listening.

Does she call you J Colone J Balloon?

No, she doesn't. It's weird. I don't know why.

Why does that catch on? Yeah, why doesn't I? Cat? Maybe Jay Bird. Yeah, maybe now. So, Pat, do that next time you see him. Go, hey, Jay Colone, how are you?

She said that to me.

Pat, you got to do that. You've got to do that.

Pat.

Kels, what have you been up to?

Well, today I'm going to Jazzercise for the first time. First time at this place? Yeah.

Why? Oh, you've done it before?

Yeah.

So why'd you pick Jazzercise?

Well, so they have multiple classes. I just wanted dance classes. So they have like a dance class one tomorrow and like a Zumba esque one and then this. Jazzercise?

Yeah. Yeah, I think it's great because it's a. Is it all women or do men go to that too?

Men can go to it too, but.

When they say can, it means they don't. Yeah, okay. But it's. It's a communal. It's a. It's all dance based, right?

Yeah.

Okay. And you're a dancer?

Yeah, I mean, I. I dance.

Oh. Yeah. I didn't mean to have a professional overtone to that.

Yes.

But you like to dance? Yeah. That's awesome. What have you been up to, Jake? Blown.

So, Oh, I got into this. This guy, his name's Dave. Politics. I don't know if you ever heard of him.

It's manner, size.

Is that the man? I got into him this sound. So, you know, I'm like all about, like camping and stuff.

Yeah.

So I started researching, you know, how to deal with bears and things like that. Because I want to go out to Yellowstone.

Oh.

Like in the fall if I can.

We should do our retreat out there.

Yeah, that would be cool. But wait, let me tell you the rest of this and then you might change your mind. So this guy is a former police officer and he wrote four books and it's called Missing 41 1. And it's all these stories about how. And the media doesn't report it. So many people go missing in national parks and it's like the weirdest stuff. They, they find them and they don't remember what happened and they're like miles away from where they.

They.

I mean, crazy stories. And so he, he documents, he. He writes all these books on.

Oh, that sounds interesting.

It's really interesting. It was kind of freaky though, when you're thinking like, oh, I want to go camping there and these people are gone.

Okay. These people are gone. Are. Are typically found again?

No.

Oh. So Some people go missing.

Some go missing and then when they find them, it's just like the weirdest circumstances. Other people go missing and it's just completely unexplained. Like one of the stories was two parents were with their young child who they were like picking up rocks in the stream and only a few feet away. And they turn around, the kids gone. And then they searched for.

But there's coyote fur all over.

No, that's the thing. He only reports on if there's any chance of any animal or abductions. He doesn't report on it. It's only the completely unexplained disappearance.

Oh, okay. That's fascinating.

And. But apparently there's hot spots. If you look at the map, there's hot spots all over. Oh, the United States where they occur.

Paranormal activity.

Yeah. The stones number one spot where Jacob loan Yosemite.

Yosemite is.

Oh, Yosemite.

Yeah. He says it's. It's number one. I know, it's really freaky.

What are you laughing about?

You're like Yosemite and you're like Yosem. It felt like you were having a little pronunciation.

Yeah.

Yosemite. Yo 70.

But then it freaked me out.

Is there where Old Faithful is? Yosemite, I think. Yeah. Or is that Yellowstone? That's Yellowstone.

Yes, Yellowstone.

Yellowstone.

Okay.

Yeah, keep going.

But then it really freaked me out because one of the hot spots, which is where I go a lot is Adirondacks.

Oh, I was just up there. That's where Woodstock's up in the Adirondacks. Not. I mean, it's on the fringe of it.

Yeah, yeah.

Beautiful country up there.

Yeah.

Well, here's my argument. I think most people go in ill equipped. I shouldn't say most. Many people go in ill equipped. I wrote a story in Fix this next about a woman named Amanda Eller. She went into a national park in Hawaii and her intent, she says, was to go on a three mile hike. She went about a mile and a half in, saw a spot that she wanted to meditate. When she could stop meditating, she started to walk out, got lost. She was in this park for 17 days. And they found what? Yeah, Amanda Eller. I thought you were going to say 17 hours, 17 days. Well, it's human nature when we get lost that we often start doing walk in circles. And that's exactly what she did. We think we're walking straight and often they're very tight concentric circles. Like it's not like you walk in this big mile circle. It's like 400 yards. And here's what research. I wrote about this in another book. Research has found that we favor our strong side. So if you're right handed, you actually step a little bit further with your right foot than your left. So there's this natural tendency to walk in a circle because you're walking more with your dominant side. That's wild. So it's hard for us to walk straight. But then also with no beacon, you know, no navigation point, we just constantly are kind of correcting ourselves. And in her story, when they interviewed her, she said my intuition was so strong I knew I was walking the right way and we'd rely on intuition. So my whole argument in the book is intuition actually doesn't serve us in many circumstances when we think it does. So in Fix this next, I made this entrepreneurial compass a very simple way to double check your intuition to make sure you're walking straight ahead.

Yeah.

But just going back to your story, I think a lot of people, I wonder if a lot of those people that get have these mysterious events dehydrate and therefore hallucinate and so forth and are just ill equipped going into space like that.

Well, that's what's weird. So a lot of the disappearances occur when the timeline is so short that, that nothing like that could happen like.

Within like an hour or two or.

This happens the same day, within minutes.

You think they were abducted by aliens.

He doesn't give this, he. So this is what's great about this guy. He doesn't give his idea on what happens because he said, I don't know.

Yeah.

He's like, and I don't want to ruin my credibility, he's like, I give you the facts and he gives the 411. He gives 401. But it's true, a lot of people go ill equipped. I mean if that woman had, you know, brought a compass, that's why I wrote the book. Yeah.

If she simply brought a compass, she would've been out.

Yeah.

Or at least walking one.

Or just have like a watch and basic survival skills. You can, if you have a watch, you can figure out the sun, which direction it's going kind of north a little bit for the most part. And then just.

She didn't bring a cell phone, she didn't bring water.

That's not smart, you know, cuz it's.

Like, oh, it's only. I just did a hike up Camelback Mountain in Arizona and right when you go there and I follow the rule exactly, it says the moment you're halfway through your water, turn around. That's because then you have another half supply coming down. And the second I hit the halfway point and in the bottle, my mind is like, oh, I can keep going. I've got this. But that metric, I was like, oh, no, don't risk it. And by the time I got down, the water was gone.

Yeah.

So, yeah, yeah.

He even says, he's like, you know, most people go to these national parks thinking it's Disneyland. Like, oh, no, no. He's like, it's. You can die, so come prepared and know you're New Year's stuff. It's just fascinating.

It is fascinating.

Super interesting.

I do want to thank our core partner, nextiva, for making the show a reality. We love your support, nextiva. And I do. Do we have a listener shout out?

We do.

You're just not ready for it.

I'm almost there.

Leave. Keep leaving. Keep going. All right, you got it.

Yes. This comes from Lionel Felix on Instagram. He writes, it turned our business into. In reference to profit first. It turned our business into a profit machine. No book or methodology has been more impactful, period.

Nice, Lionel. Thank you. And he wrote the word period.

Yes.

Yeah, that's emphasis. You didn't say that he wrote that. Thanks, Lionel. I'm just saying when people write the word period, they are not bullshitting around. Yeah, Kelsey, you know someone else that doesn't bullshit around? Charles Cadet. You got to say something. You don't have to shake your head. They can't see you. That's something on our YouTube channel.

Yes, that's true.

Charles Cadet is the author of the Predictable Profits Playbook, the Entrepreneur's Guide to Dominating Any Market and Staying on Top. He created his first multimillion dollar business at age 24. What were you doing at age 24, Kelsey? Yawning. Oh, I'm sorry. Am I boring you now, Kels? I'm sorry, because YouTube's watching. What were you doing at age 24? Smoking weed. Working. Yeah, right. And he's helped others generate millions with his strategies. He was named one of America's Geniuses in the top 50 industry influencers. Charles hosts the Beyond 7 Figures podcast and is the CEO of Predictable Profits. With no further ado, Charles, welcome to our show.

Well, thank you. Thank you. Thank you very much. I now know that I will not be taking my family on a hiking trip in a right, you know, not without a cell phone and plenty of water, I guess.

There you go. There you go. Are you. Are you big into nature? Do you get outdoors a lot.

I live in New Hampshire, so I think by default we have to be somewhat big in to nature.

Right.

I think there's a hotspot around there. Yeah.

Yeah. What's it? You're. You're not in Portsmouth, are you?

Oh, man. Yeah, because Portsmouth is the hot spot.

Right. What's the closest national park to you?

Say that again. I'm sorry.

What's the closest national park?

It'd probably be around, like the Mount Washington area.

Yeah, yeah, that's. That's a big one.

That's a big hot spot. That's a big hotspot. So let's talk about predictable profits. You do a lot of speaking. You're in front of thousands of entrepreneurs every year. What are the triggers that bring about profitability permanently? And what are the things that actually going to work against us?

What are the triggers that. All right, well, that's a. That's a loaded question. So why don't we start with sort of. Yeah, well, I mean, I'm like, all right, well, what. All right, let's talk. Let's take it one step at a time, I guess. What are the steps that. That bring about, you know, predictability and whatnot?

Yeah.

You know, the first thing that. That we like to look at is, you know, momentum. The more momentum a business has, the greater you're able to have a little bit more of that predictability. Momentum is anytime you're already generating leads and sales traffic and so forth.

Right.

And it's when you know how to leverage that momentum that you can create more of that predictability. Which is why guys like Richard Branson have said very literally, when you know how to leverage momentum, you leave your competitors trailing in your wake. That's the start.

Right.

And then from there, it's like, okay, now that I have this momentum, like, what the hell do I do with it?

Yeah. So what defines momentum for a small business?

Say that again.

What defines momentum for a small business? How do you know you have it?

So if first. If you're already generating sales, that's your first clue that you have momentum. But momentum is any way that you're generating traffic, any way that you're generating leads, any way that you're generating sales. You see, in most cases, Mike, when you look at businesses, it's not that a business fails because they have a poor strategy. Oftentimes a business fails because they have a momentum problem. Interesting. And many times, actually what happens is you see this a lot, especially with small entrepreneurs. They start something, they start a strategy, and Then they're like, oh, it's not working fast enough. So they go to the next one. Then they go to the next one. They're like, oh, Facebook ad course, I'm going to take this one. And they go to the next one. They go to the next one. And so they never take the time to actually build up momentum in one strategy or one area of the business. Instead, they kind of. They start a little fire and they put it out by going to something else. They start a little fire and they put it out. Start a little fire and put it out. That tends to be the biggest cause for failure in these businesses.

Okay, but on the flip side of that, if I start something, when do I know that I should abandon it?

Well, so with everything, you want to attach these KPIs, right? And so the KPIs let you look at, you know, what's working and what's not working over time. I think if you've really just spent enough time and money on something. And look, I'm a huge proponent of making sure you're getting mentors. Because, Mike, I'm sure you've heard this a million times, people will tell you, this doesn't work for me. But they're giving up too early, because just because they might have tried one or two things doesn't mean that it actually doesn't work. So find somebody that has the experience and help guide you through it. You know, quite frankly, I think over time, you know, if you put enough time and effort into something and you just can't. Can't get it done, then, yeah, it's probably time to. To look for. Look for something else. But most people give up far too early. In fact, I had a mentor of mine. I mean, I was literally banging my head against the table. I'm going, I can't figure this stuff out. And he goes, great. Like, what are you talking about? And he says, it's at the closest point that you want to give up. At that brink where you're saying, that's it. I'm throwing in the towel. I'm done. That you're the closest you've ever been to success.

You know, that's an interesting phenomena. I just took a trip up to tour business called New York State Solar Power. It's a long name. And I was meeting with the owner, Anthony, and they were just on the brink recently of just. He said, I just. I'm just done. He's like, it's so hard. And then we're going through the numbers they had prior debt, they were on the brink of eradicating it. They had continual profits, they had taken three quarters of profit distributions. They'd made so much momentum, but they just weren't over the hump yet. They hadn't finalized all their debt. And they had an opportunity. Someone was offering to acquire them. But it was like this ridiculously low ball offer. He was seriously contemplating it.

Why?

I could see as an outsider like this guy, he's on the brink of going really big. Why is it that entrepreneurs, when they're so close to that turning point or the finish line, feel most compelled to give up?

It's not just entrepreneurs to pick on that one group. It's really everybody. I mean, you get to this point where you're just so hard and you've put your heart and your soul into something and you just, you have that hard time seeing the light at the end of the tunnel and that's all you're looking for. You're looking for that little bit of light. You just haven't turned the corner yet. And there's all this self talk is in this belief that you can't do it. And you know, just go on the Internet, look at Facebook, you've got all these experts and gurus saying, hey, the reason why you're not here is because you're missing this. The reason why you're not here is because you're not doing it. And then you go look at, you know, these magazines and you say, wait a minute, this person who, you know, I have this idea in my head that I'm smarter than this person and I'm somehow better off than this person, and yet they're making 10, 20, 30, 40, 50 times more than I am. Like, I don't understand why am I not doing it? And so all this self doubt starts to creep in. You start thinking maybe you're going in the wrong direction. And so that's why you kind of veer off and you know, and give up too early. And that's why I hesitated when you said, when do you give up? Because I'll tell you from in all my experience talking with thousands of entrepreneurs over the last decade, most people, and I'm talking like well over 99% of people give up far too early.

Now you're the exception to the rule because you grew a million dollar business. You're age 24, but also you came from a position of, I think it was a million dollars of debt, right?

Yeah, I was in a million dollars in debt. And just before being in a million dollars in debt. This dress really kind of got to me massively. I was on my way to my house, realized I actually wasn't going to end up making it to my house because I got this pain shooting from the base of my spine all the way up into my neck. And before I knew it, I ended up in the emergency room. I had been setting my alarm at 3:30 in the morning so I wouldn't, quote, unquote, oversleep. Worked every day, seven days a week, holidays included. And the result, I exhausted my body. My organs were shutting down, and I was developing this condition that was killing me. So I should have given up by all logical means. I mean, if my mom was there, she would have been like, that's it. Go get a job. You know, but, yeah, you know, when you're in a million dollars in debt, there's no job that's going to help you, you know, pay that off. You have to make it work.

Ironically, Pat Smith tells Jeremy every day, like, what are you doing on the show? Get a real job.

Yeah.

So what was the, what was the diagnosis? I mean, the doctors say, oh, you have Stephen Hopkins disease. Or, I mean, or they're like, it's a stress. I mean, could they diagnose that situation?

They did give me a term. I don't exactly know what the term was, but I know that part of that term. They wanted to put me on some sort of medication. It's a very similar medication to what they give cancer patients, as I recall. I don't know.

This is.

We're talking now almost two decades ago, but yeah, was not a fun point in my life.

So, okay, so there's a perfect example. Like, that's a stopping point. You're dying, and it sounds like you saw it through. I mean, were you really that close to the finish line and making that business successful, or was that the call to actually, it is time to call it quits.

If I kept going down that trajectory, I don't think that I would have ever have created a successful business because, see, I. I graduated from one of the top business schools in the entire world. You know, I had my dad, who was a successful entrepreneur that would tell me the secret of success is hard work. I thought I had it all figured out, and yet here I am, only going deeper, deeper into debt, working harder than I've ever worked in my life, and I can't seem to find my way out. It wasn't until this event happened that I was forced to start differently or start to think differently. And, you know, I, it was at that point where I, where I actually changed that trajectory. And you know, I think at any given point in time I was living off the skin of my teeth. I mean, there were days and weeks where I would wake up going, I just need to buy one more day. I just need one more day. Something needs to happen. I just need one more day, one more day. And so, you know, I would cut a little break, maybe get a month long more of cash flow or some days it really was just one more week. I mean, it felt so good to be able to like pay my credit card bills, like, oh, thank God, I've got 30 days left, you know.

So is that the first step to predictable profits? I really want to understand where strategies we can put in place to achieve predictable profits.

So, you know, when you have that momentum, when you're generating traffic, leads and sales, you know, it's so simple that it's almost embarrassing. And unfortunately, it did take me over 10 years to figure this out for myself. Like on that first million dollar business that I created, like it was putting it together without realizing that I kind of had it figured out. It actually took many years later before I actually said, oh, wait a minute, now I know how I did it. So once you have this momentum in your business, the first thing you have to look at is what am I doing that's working and what am I doing that's not working? And you go into this phase of what we call optimization. Now this is something that I learned from a protege of Dr. W. Edward Stemming, a guy who created billions of dollars in process improvement, made more money than any other person that I'm aware of because he influenced the whole world. And so you start looking at everything that you're doing, every tiny thing, and you start saying what's working, what's not working? And you optimize it. And you put these KPIs. You understand the impact most people, Mike, you're like, you're one of the foremost experts in numbers and whatnot. So you understand the importance of having KPIs and something to track. And so when you have these KPIs, you can know what the impact is. And, but the problem is too many entrepreneurs are playing this game of guesswork. So you have the KPIs and you look to optimize it. That's the first step, optimization. I mean, just last week we helped a client find $2.38 million within a one hour phone call, very simply by doing this optimization phase.

Wow, I hope Your deal is 50% of what you find?

Yeah. Wouldn't that be great?

All right, so I have momentum. I see my business now. I start going at a molecular level. I'm optimizing what's next to getting to predictable profits.

Well, as an entrepreneur, you're juggling a million balls in the air. Oftentimes you're doing marketing, accounting, customer fulfillment, the whole deal.

Right.

And so, Mike, have you ever watched a juggler juggling, say, you know, 10 balls up in the air?

Yes.

What happens when they drop one?

They get distracted and they start usually dropping more. Right.

They end up dropping them all. And so that's why we go from optimization to the next phase to systemization, you know, and this speaks to your book, Clockwork. I love that book, by the way, one of my favorites. But you know, it speaks to the book and the importance of having these systems and building a business that's not dependent on you. So you continue working on your business and whether that's a fully automated system, whether that's a hybrid of automation and manual work, or full on manual work, but it's all documented with processes and systems. And so then you have, so you have optimization, you have systemization, and then the last phase is innovation. Now, innovation can go in many different directions. In one direction it could be, let's start a brand new profit center. So this is where you start a brand new strategy with no momentum. You could start one, right? That's one area that you can do innovation. The other thing, and this is the part that's almost always forgotten, especially by small businesses, is the idea of how do you stay more relevant to your customer or client? If you were to ask me, hey, Charlie, what is going to be the competitive advantage over the next 10 years, I would tell you in one word, relevancy. There's more competition right now than ever, ever before. And so what's happening is, I think it was Peter Georgescu, he's the one who first came out with a statement where he said commoditization is the cancer of the 21st century. And it's becoming harder and harder and harder for us to create our unique advantage point or our unique selling proposition. And so the way that you're going to do it, because there's so much competition, there's so much overlap, is how do I become more relevant to my customer or client than any of my competition out there? And so that innovation stage is going to help you figure out what do I need to do? What other product or service can I add? That's Going to help my client achieve the ultimate result that they're after.

Now, you've helped companies grow super quickly, the Inc. 5000 list and so forth. Here's one not so well known but secret about some of those businesses. Their revenue is growing, but a lot of them are struggling with profitability. How do you achieve rapid growth and sustained profitability, or is it even doable?

Well, I mean, so this is all going to depend a little bit on the business. Right. And some businesses, when you go through that optimization stage, you're actually finding ways to, you know, increase their conversion rate without spending any more money on marketing and so forth.

Yeah, right.

So that, that, that you can create an enormous amount of growth and your profitability is growing at the same time.

Yeah.

But then as you start moving from, you know, optimization to systemization to now innovation, most, most entrepreneurs kind of put that up front. That's why they're like, oh, let's develop another new profit center and let's go another one, another one. But that takes more time and money than if you focus on the optimization. So the innovation stage, when you get to that point, you're looking for those breakthrough profits. That's when you got to be saying, that's, you got to be willing to say, you know what, we're going to reinvest many of the profits that we already have into our business back into growth. And so, you know, that's, that's where, you know, that part's fine. But you know, when you look at profits, right. Profits are, this is, you know, your, your food, this is your, that what's important for the life of your business. You can only go so long without food.

Right.

You can only go so long without profits. But over time, eventually it's going to catch up with you. So profits are essentially, you know, that is your lifeblood. That's what's going to keep you alive and above water.

Right, right. There's no question about it. So, and, and I preach that you've seen so many businesses trust. I'm just curious about your perspective. Is there some indicators when you look at the business, but particularly the entrepreneur, that this entrepreneur's got it, they have the potential. She's going to go the distance or say. And do you see certain entrepreneurs like, you know, what, they're unsalvageable. I'm just curious what the tendencies are of the entrepreneur that you see dictate predictable profits versus predictable kind of failure.

Oh, this is like one of my favorite questions to answer, Mike, because I'm telling you I had the opportunity to work with so many entrepreneurs over the years, and I share the same information with everybody. And yet, even though I share the same information, there's those people that go off and, you know, like you said, will, you know, earn their spot on the Inc 5000. And then there's other people that just can't manage to, you know, get anything right. And so that was a big struggle. What is the difference? And it comes down to the very first time I have a conversation with somebody. If I say, hey, you know what you should do? Or here's an idea, and the first thing they say is, yeah, but. Right away, I know they're done.

The yeah, buts. I love it.

That's what we call them in my company. Yeah, buts.

I love it. It's so funny. I took a class in improv and they said, never use the word but it's always. And so it's yes. And to continue the story. And the whole idea in improv is that there's this continuance that keeps on building, but with the second you use but you start to bring conclusion to the presentation. So it sounds like the same thing in business.

And I have the perfect example. One of my clients brought in this super, super rock star salesperson into his company, his sales manager. And he says to his sales manager, look, here's our target. We want to make a million dollars this month. And so the sales manager, again, huge stacked resume and whatnot, says, yeah, but, you know, it's a summer months, and yeah, but we don't have this particular person here. Yeah, but, yeah, but, yeah, but. And so two weeks into the month, my client calls me up and says, look, what do you think I should do? We're at $15,000. And I said, well, I think you already know the answer to that one. And he's like, yep, no problem. And so he ended up firing the guy. And I said, so what about you now? Now you're back in the shoes of the sales manager. What are you going to do? And he said, I've got, you know, $985,000 to make up. And I said, so what are you going to do? And he goes, I'm going to do it. And there was no yeah, but there was no oh, yeah, but there's only two weeks left of the week. I mean, two weeks left of the month. There's no yeah, but he's like, no, I'm going to do it. And he ended up, I think he finished the month. If I remember right. It was like, 975,000. So, like, really, really close. Really, really close to that million. But this. This guy, he's always been like that. It doesn't matter. There's never an excuse. It's always, I'm gonna do this, period. See, a lot of people, they end up having these goals. We all have goals, right? But a lot of people have these goals, and, you know, they go, all right, I want to make, say, a million dollars this year. And they make, I don't know, 800,000. And they go, you know what? That's pretty good. I came close. But this guy that I'm referring to, his name is Michael. This guy, there's no such thing as coming close. You either do it or you don't do it. And there are many times I learned this early on, and I. This. I actually, you know, sometimes a teacher becomes the student and whatnot. So when we first started working together, he was looking for this goal, and he came really close, like within a couple thousand dollars. And I'm like, dude, that's great job. And he goes, it's not a good job. And I go, what do you mean I didn't hit my goal? And he's so dead set on hitting the goal, because you know what. What happens when you get comfortable failing to hit your goal?

That becomes a new standard.

Right, Right. And you build a habit of failure.

Yeah.

So if one month you're okay missing it by a couple thousand dollars, then the next month you'll be okay missing it by tens of thousands, then 50,000, then 100,000 and so forth. I.

It's funny. I was watching a documentary on the Foo Fighters. It's a band I'm into. And what's his name? David.

What's his last name?

Gro Band.

I'm into. I don't know his name.

I'm into. I said, David.

I couldn't understand.

Jeremy. You're jumping down my throat. But he's this. He's got this attitude, like, it's got to be right or. Or not. And he's. He had to make some hard decisions in changing the band around to perform at the highest level. But now they have so many hit songs. I mean, they're going to be one of the kind of those bands that live on, like, Led Zeppelin or something like that. They have such a catalog of miraculously powerful songs. Hey, Charles, we actually got a rock and roll. Now I'm looking at the clock. So before we let you go, though, I want to know how our listeners can pick up your book The Predictable Profits Playbook. And also to learn more about your coaching services.

Awesome. Well, the book is available at all major bookstores, of course, Amazon probably being the biggest and most well known. So predictable profit, Predictable Profits Playbook on Amazon. And then you can find me and learn more about our methodologies and whatnot over@practableprofits.com.

I'M telling you guys, Charles knows his stuff. Check out his stuff. For God's sake. Pick up his book right now. For God's sake. For God's sake. For God's sake. Yeah, but I don't have the money. Ah, see, you can't say that, Kelsey. All right, Charles, thanks for joining us today.

Thank you.

Thanks, Charles.

I like to have him back. That was some super smart stuff. We could have gone for a long time.

Yeah.

Kal, I want to learn what you learned. I want to do. Do we have a listener mail today?

We do.

And we got our game first. I do want to thank our core partner, nextiva. Yeah, but I already have a phone system. Are you kidding me? You don't have a nextiva phone system. Do we? We got to get you him a phone down at his place.

We got to.

Do you have a. I don't know.

Why we haven't done that yet.

I was curious in the meeting, did they roll? Did they use any of your new.

Ideas for phones, phone upgrades? Yeah. So the tornado warning system that makes cat meowing sounds. I don't know if you remember that episode. They really were grateful that I'm promoting that feature. The fact I promoted that they have the true voice system where the other person, their side, actually hears your actual true voice. They were really disappointed I was hearing that. And then the fact that I said that they've come out with phones other than the color black. They were not happy about that.

They didn't actually. They didn't actually mention any of that, did they? Did they really?

The marketing guy says, yeah. He goes, you know, we. I know you're joking around, but I think people are getting a misperception. And I said, yeah, but the new feature you've come out with is so impressive. It's. You've broken the cord. It's called that. We've broken the cord. And they now have a phone that you can put your ear and through. I don't know if it's some kind of ultrasonic wave pattern, but you can speak to other people without a cord connected to your phone.

Amazing.

Unreal.

They call it Cordless, which I thought was a horrible name. I call it the ultrasonic connection. Nextiva. It's the only company to have it, so go to nextiva.com and get. Seriously, a powerful phone system. All right, Kels, I want to know what you learned today. Oh, a double.

So my favorite aspect was talking about relevancy, because I feel like it's so true. In such a saturated market, not only are you building that relationship more effectively, but I also think it forces you to become more integral with your business. So if you're relevant to them, you are actually serving them in a better way.

Yeah. And I think it also requires you to always be upgrading your business. Right. Because relevancy is not based upon a static business. Right.

Yes.

Yeah. Is your business. Are you selling jewelry still, or is that.

I'm not.

You've. You've put that on the shelf.

Yes, Until I do my basement.

Oh, until you finish your basement. Yeah, yeah, yeah, yeah. Jake. Blown. Yes. Pat Smith wants to know.

Does she? This one's for you, Ma.

It's only the beginning. Was it Landslide by Stevie Nicks? This one's for you, dad.

The fact that when you fail, it's usually not because of poor strategy, it's because of momentum problem. And when you feel like it's. You're just not getting there and you're ready to give up, then that's when you're the closest.

Yeah, I just.

I think that's. That's really awesome if you just kind of keep that in your head and keep pushing, pushing, pushing.

Yeah. So I'm gonna piggyback off what you said. The momentum, to me was my. Definitely my big aha. You know, my. My perception was predictable. Profits is from. And he mentioned things like organization, systemization. But it all starts off with momentum. And if you have momentum, he said in sales, traffic, or leads, you have a business that's. That has a foundation for profitability. I actually never heard someone talk about that factor first, so I thought that was remarkable. We want to know what you, my dear listening friend, think was remarkable, too. You can rate us and review us and add your notes in any podcast that you listen in on. All right, Kels, we got a game. I know. I know. We got a game we're gonna play. It's a little riddle.

Okay.

I. I was waiting to have a week where Amy wasn't here because she's a riddle ruiner. Last time I was here, I didn't even finish the riddle, and she blurted out the answer. I hate people like that.

I don't think she ruined it. I think she's Just smarter than you.

So I was watching a documentary on the Price is Right on Netflix, and there was a guy who. They called it the Guy who Knew Too Much. Yeah, you know, I'm talking about.

I saw. I didn't watch the movie, but I saw the clip for it.

So there was this guy who spent every day of his life studying the Price is Right TV show and their pricing. And he would sit in the audience and the Price is Right would allow you. And still does the audiences shout out suggestions to the contestants.

Yeah.

And what he noticed was that the Price is Right would have maybe a thousand items that they kind of circulate through. So a refrigerator. And the whole game of Price is Right is the contestants have to yell out the price without going over for that unit. And whoever's closest wins award. Well, he memorized the list of a thousand things. So they're like, Bob Barker's like, and here's the brand new refrigerator. What's the price? And you hear the guy in the audience, he's like, 996. And he was nailing it one after the other.

That's awesome.

Yeah. I don't know why I went down that tangential path. Well, he just reminded me of Amy. Like, he ruined it. Like, he. Like, no one can have any fun. Like, everyone's like, 996. Like, yes, it was 996. Even Bob Barker is like, what a tool. Here it is, the riddle of the day. A doctor and an entrepreneur. Oh, dude, this one's for Pat. This is so perfect. This is true. It's in the text. I'll show you later. A Dr. Pat Smith, this one's for you. A doctor and an entrepreneur are both in love with. With the same woman, an attractive girl named J. Bone. It's in the text. That's her name. So it could be a female name. I didn't know that. The entrepreneur had to go on an out of town trip that would last a week. Before he left, he gave Jay Bone seven apples. Why? So listen closely. A doctor and an entrepreneur are both in love with the same woman, an attractive girl named jbone.

This is so confusing because you're using J. Bone as somebody who's in love with the person. But then you're talking about my mom. It's like just.

Is it a horse?

Yeah, I'm very confused.

We'll call Jessica just to make it easy for you. Okay. A doctor and an entrepreneur both in love with the same woman, an attractive girl named Jessica. Who else goes Y ta? Bone, the entrepreneur had to go out of town on a trip that would last a week. Before he, the entrepreneur left, he gave Jessica seven apples.

Why an apple a day keeps the doctor away.

Boom, boom.

Nailed it.

Nailed it. Yeah. When your name was in there, you're like, she's so attractive. J Bone. Pure beauty. Pure beauty. All right, Kels, listener man, let's get the hell out of here. Sick of today's episode. No, no. You guys just ruined everything for me. I. I tried to make this fun.

I pulled a Kelsey with the Dave Grohl comment. I'm sorry about that.

You didn't. Well, you didn't. Oh, you did.

Yeah, I did.

Yeah.

Yeah.

I was nice.

Yeah, you were like, what's wrong?

I know. You gave me a dirty look like.

Yeah. Isn't that funny? Just as another. Yet another side on our show is Kelsey will attack. But when someone else attacks, Kelsey. Yeah. Becomes protective. If she's not attacking, she's not.

She's the only one who's allowed to attack.

Mama. Kelsey. What do you got there, Kelsey?

Okay, so this comes from Ryan Reiger. He writes, we buy and resell products so we have high input costs. I subtracted the cost of material to get the real revenue. The taps for my real revenue match pretty close with the historical data for our company, although we have room to improve. My question is about allocations. The money in the income account should be allocating according to taps, but since I am using real revenue, how do I allocate the money in the income account? It seems like I should be deducting the material costs, but if I do, the sum periods will have a negative amount. Do I draw money back from the other accounts on months where the real income is negative?

Wow, that's a long, almost a loaded question, but it really isn't. We need to set up a materials account. So if you're making an adjustment from income to a real revenue and say your materials, the percentage you determine on an annual basis is 25% of your income is used to procure materials. Set up a materials account and put 25% in there. So the income comes in. We'll say $1,000. 25% would be $250. You transfer to the materials account. Now, the 750 remaining in your income account is your real revenue, and then you do the allocations accordingly. Ah, that was good. That was good, Kelsey. Is that it?

I think that's it.

Oh, the music's coming on. Must be.

But don't forget to subscribe or rate and review us wherever you're listening.

Hey, and why don't you. Why don't you come out here to my office? I'd love to hang out with you and maybe have some fun conversation. Kelsey can peek her head in and ruin it for us. You know, if you come to Profit first live, we'll talk about Profit first. Make sure you're doing it right and drive properly in your business. We can explore the other stuff we're doing too. Clockwork about systems, Pumpkin plan about sales growth. Fix this. Next, the entrepreneurial compass, you know, and the starting point is go to profitfirstlive.com to get that. And if you want all my free resources, you can get that@mikemotorbike.com alright, that's it. We'll see you guys later. Bye, Sam.