0259: Mastering Money To Drive Growth In Your Organization with Co-Managing Partner & CPA Courtney DeRonde

This is Courtney Durandi. You can find me@tdtpc.com and you're listening to EA Interviews.

EA Interviews, episode 259, inspiration, transformation, success stories and the Imperfect Action Round. Seven days a week. Join Mario Ficcini for today's expert authority effect interview. Money, money, money. Everyone wants more money. Everyone wants more profits. Everyone wants better business. All this stuff, hey, what do you want to do? I want more leads. I want more sales. I want more conversions. Everyone has an answer for any everything. But what are you aiming for in between it? Do you want to try and pay zero in taxes? Do you want to have the best product in the world? Maybe I do. I mean, but is that the right goal? Can you have a okay product and still be profitable? I've used in my own presentations. They sold a freaking pet rock. If you don't think you can sell, just keep that in mind. They sold a pet rock. I just am going out on a limb. Your product is probably better than that. We're going to dive into money, we're going to dive into the products where those should be, how to be profitable. And that's why I'm excited to have Courtney Durande on today's episode. I'm going to bring her up right after we thank our sponsor. Every business needs a book, including yours. Visit freebusinessbookpublishingcourse.com today to learn the seven steps to publish and promote your nonfiction, lead and profit generating business book in eight weeks. Once again, that's freebusinessbookpublishingcourse.com Here she is, ladies and gentlemen, Courtney Durande. Courtney, how are you feeling today?

I am feeling great, Mario, how about you?

I am super excited to learn what you know because I know you have a vast knowledge of finances and it's super important to business. So I'm going to just ask you why is finances so important to business and should someone have the best product?

Yeah, yeah. So thanks for having me on here. And I think finance and accounting is so important because it's keeps the score. It measures how all the hard work you're doing is paying off. And so having accurate, timely, relevant information is really foundational to being able to tell if you are profitable. And so it's just having the data and the insight and the analysis that you gain from the data to really tell is this working because you spend so much of your time and energy and the time and energy of your team, all your resources on trying to be successful in your business. If you don't have accurate, timely, reliable Financial information, you don't analyze that. It's hard to know if what's working and what's not.

What would you say is the first metric someone should be looking at?

Yeah, I think one of the first metrics that you want to look at is profitability per product.

Know which of your products make you money. So you know, there's, there's lots of things that you can look at. But if you don't know, you know which of your products or services makes you the most money, it's hard to know where to focus your efforts. So a lot of times business, businesses will look at profitability overall or margin overall. But if you can drill down one layer and look at it through your key products and services and know, ah, look how much more margin I make on this not top line gross revenue margin, then you know where to focus your, your efforts around.

Speaking of the margin, is there a certain amount someone should be aiming for?

It's really industry specific. So you know, whether you're a restaurant or a distributor or retail or service, it can vary greatly across the industry. But I would say for whatever your industry is, you should know the benchmarks of your industry and be thinking about it from that perspective. But in terms of, you know, what the gross profit margin should be overall. And it really depends on what type of business and industry that you're in.

And I think that's so vitally important because there's coaches and consultants who I know are running an 80, 90% profit margin. Some people think 50% is good. I've heard from my restaurant clients in the past that you know, 20, 30%, 18, 24, somewhere around there. That's fantastic. And there's always everyone is, what did I just say? There's always every, whatever Walmart, everyone's trying to, oh, I'm gonna underprice them and do that. They're trying to do the Walmart model and I know that they, there's one point they had in fact, checkers, relax, okay. I don't know if it's 1.4 or 0.68, basically a 1% profit margin. I don't know any small to mid size business short of Walmart who can run on 1%. So where would you tell someone to look to get those numbers in the industry? And then what if they don't like them?

Yeah, yeah. So I think, well, first of all, when we talk about margin, it's important to make sure we're on the same page about which number we're talking about. So your profit margin is your sales minus the cost of selling those goods. That's your profit margin. And then you've got your operating expenses. And after you subtract the operating expenses, then you've got your net income or your net income before, maybe taxes and depreciation. And so this is why it varies so greatly, because some businesses have a high cost of goods sold and a low operating cost, and some it's the opposite. And so it's not just like you need to know for your business model. The margin that I make from selling my goods or services has to cover my operating expenses as well. So if I have heavy operating expenses that aren't direct cost of sales, I'm going to need a lot more margin to cover those operating expenses. If I have low operating expenses, then my margin doesn't have to be as high because there's not a lot left to cover. But as far as, where do you look for that data? Industry associations. And there's all kinds of marketing tools out there that can give you data that you might have to pay for. But as far as free data, I think a good resource to start with is for your industry. Is there an association of businesses or professionals in your business that gather that data and share it? Sometimes you can participate in a survey. And in our industry, in public accounting, we, we have a few different resources out there who do surveys and you pay and you have to give your information, but then you get the data back from everybody else, from your peers, and you can see that. So you might have to pay a little bit for it, but it can be helpful in assessing at least a benchmark of your peers. What if you don't like the data? I would consider.

Well, I don't mean not the data. I mean if someone, if the industry says it's a 22% margin and that's good and that's the industry average, and you go, well, scratch that. I want 30 to 35%.

Yeah, yeah. I think one thing to take note of is when you get these benchmarks, if they are averages.

Are we really striving to be average? Like, you know, that means that somebody's higher and somebody's lower. And so, uh, you know, some, some studies will show like a high performing or a high growth. I just try to be aware of whose data you're you're benchmarking against. And note that if it is an average, that might not mean that that's your goal. Your goal might need. You might want to be, you know, 10% above average or some certain multiple above Average. And so, yeah, it doesn't necessarily. It's just a benchmark for you to use as part of your analysis.

Now, you had said something earlier. You said going that one layer deeper gives you so much more insight. I want to ask you what, what do you look for when you're going two or three levels deeper?

Yeah. So then you can really get into more of the costs that make up your particular cost of goods sold. So if you're at the, if you're starting at kind of a top level of sales, less cost of sales, and to get margin overall. So let's just say that's like top layer going down. Another layer is sales, cost of goods sold, and margin by major division, initiative, product line. You might go down another layer and say, okay, within this division, what are the main products? Or within this geography, what are the different geographies? Once you get beyond that, then I think you're down to the input costs. You know, how much of our cost is from labor or materials or depending on, you know, if it's, if you're, you know, distributing books, how much of it is it from the actual distribution cost or paying the distributor versus the author? I mean, there's all kinds of different examples that we could give. But I. That's kind of how you get down. And you don't want to go that granular on every single thing. But you, if you don't capture data, when you account for things with those kinds of, you know, classifications and tags on transactions, you won't be able to pull that data back out. So you always want to start, you know, big picture and then figure out, where do I need to go deeper? Because you could spend hours and lots of dollars just drilling down into finite details of the accounting and still miss the overall picture of what you need to focus on. But it's either way, if you want this kind of information, you have to have a process in place to capture at the transaction level and assign these kinds of classifications and codings to transactions so that when you do want to dig in deeper, you can do that.

And I think it's so great that you're mentioning that, because I've always been more on the side of, let's get all the data. We can always go back and use it whenever we want. But it's hard to go back a decade and try to remember, hey, first quarter versus third quarter here in that timeline in the right context with those clients. It's like, you're not going to reconstruct it backwards. But even if you you have a hard drive you've never pulled the data off of. And now you're like, okay, now I care. At least you have that data. And it's reminding me of that analogy of you take a jar with the big rocks and medium rocks, small rocks, then you dump the sand in it. It's like, if you put all the sand and all the grant literally granular, you're not going to have room for the big important stuff. But the smaller stuff can always fill in everything around it. And I love how you're talking about it because a lot of people do talk about, you know, some of my own clients, I'm like, let's talk about your profit margin. And they're like, what do you mean? Like, holy smokes. Well, this is step one, you know, or audiences, I should say.

You start there, but then you go, well, what's your most profitable product? And also the timeline, this might be most profitable, but if it's taken you six times longer to do it, the efficiency, like you're saying, you know, where can you improve? Or the distribution? And, you know, you might be making a lot, but if you're also spending a lot, you're making less. So all of these things matter. Is there anywhere else that someone should be looking for to go without getting too granular? But is there another area at all that someone can be looking for to say, hey, here's another way to increase profits?

Yeah, I think another thing to look at is your sales mix. So what portion of my revenue is from this product or this service? So you want to know both your mix and your margin. Those are two key things where you can think about. Okay. And especially right now, in. In a time where there's a lot of disruption and a lot of businesses are having to think about how to remain relevant and how to adapt and change to meet the needs of their customers, knowing which. What your mix of products and services are and your margin for each of them, and then being able to tell, okay, which ones are the most profitable. Because sometimes you might have a smaller profitable, like a smaller profit, a smaller margin on a product, that's a higher percentage of your sales mix. So more of your margin overall might come from a less profitable product. So you don't want to just say, oh, well, the margin on product A is lower than the margin on product B. So let's focus on product B. If a huge percentage of your sales mix is product B, it still might be contributing more profit overall. So you have to know both the mix and the margin. And Then you have to think about, okay, in this kind of, in this time especially, and I think any time, but this is a good time right now in 2021, is to think about, of these products and services that I have, knowing the mix and the margin.

Where'S the intersection of what's profitable and most helpful and relevant to my customers? And that's where you focus. That's where you drill down deeper. That's where you put your marketing efforts around. It's not just what's most relevant and helpful. It's not just what's most profitable. It's all three. The mix, the margin, and the relevance and helpfulness to your customers. That's really the kind of perfect storm of where you should be focusing your efforts.

You clearly know what you're talking about. How did you get into it?

So I'm a cpa. So I studied accounting in college and joined our firm, TDT, CPAs and advisors right out of college. Actually did an internship before I graduated as well. And so I've spent my whole career here serving clients and helping small businesses and nonprofit organizations. So definitely my education and my CPA licensing and my experience serving small, small and medium sized businesses and nonprofits has contributed a lot. But also as a partner in a professional services firm, I'm, I'm a business owner and I am our managing partner as well. And so that is where it's kind of. It really adds a whole nother layer of experience and expertise because it's not just looking at somebody else's data and guiding them and advising them. It's doing the same thing firsthand in our own business and our own firm. That has really taken it to another level of seeing probably more of the emotional side of it. When you're a business owner, like, this is your stuff, this is what you do, this is what your people do. And we can get so wrapped up in the mission of what we do, the purpose of what we do, and helping customers or clients, which is all very valuable. But if we can't do it in a sustainable and profitable way, we're not going to be able to help those people long term. And so I guess what I would say is for me to have that finance and accounting background, to have a CPA license, to have almost 20 years of experience serving clients, and to still have to really think about these things. As a business owner, I know it's not easy for business owners who don't have that kind of background.

Who is your favorite type of business to work with?

You know, one I really love working with other professional services businesses like, like our own. So people who are kind of in the business of serving and using their time and their knowledge and their expertise. So attorneys, architects, marketing companies, consultants, any kind of service provider. I have always really enjoyed that because I have so much firsthand knowledge from our own firm that it feels like I'm able to help them see some of the, the blind spots that I have seen in that role in our own firm. But. But I like all small businesses and nonprofit organizations, but that's probably my favorite.

Yeah. And I know the last.

So many more people are jumping into coaching and consulting, which I think is great because there's so many people out there with experience that they've been doing 10, 20, 30 years, heck, even five. I mean, if you're in the right industry. You know, one of the things when I was deciding who do I want on the show, I was like, well, do they need five years experience? 10, 20? There's people that got 50 years experience, but it might not be relevant anymore. And there's people that have two years experience and it's extremely relevant. So I'm like, well, that doesn't work.

You know what I mean? And there's so many people that are now realizing I've been doing this for 30 years in some other venue and, and now I want to do it in my own. Whether it's to start a business, just consult this, that, the other thing. But I noticed you mentioned authors and I've been publishing for nearly 10 years and. Do you have a lot of author clients?

We have a few. We don't have a deep experience or a deep niche in authors or.

You were just saying when you have the cost of the goods of shipping, the books and the distribution.

Yeah, Yep. Just as an example that I thought you might be able to relate to, but, oh, 100%.

It's like, yeah, I want to do this, this and this. And it's like, yeah, I'm going to do it anyway. But wow.

Well, and I think with so many people getting, like you mentioned, getting into coaching and consulting, I feel like that's because we started out the discussion on data. So much information and data is now available. And so, you know, in the past.

How do you interpret it?

Right. That's where the value comes from. And that's a big component of our firm is that, you know, in the past, we've been around for 45 years and in the past it was about getting information from clients, processing the data, putting it on returns and financial statements. And so on. Now we can leverage technology to gather that information. The value we provide is the insights and analysis and saying, okay, we've got to get the data in here so that we can help you see what does this mean for your business? How does it help you make decisions? And that's similar to other service providers. And you mentioned coaches and consultants. People can Google and watch YouTube videos, you know, for days. But having personalized coaching and guidance and insights and analysis is what is so valuable. And some people just haven't made that switch or some service providers haven't realized that that switch is necessary to remain relevant. You've got to stop focusing on just processing data to using data to provide insights and analysis.

Yeah. And people have been saying for years, they're like, content is king. Content is king. Content is king. But it's not, it's context. There, there's no shortage of content. But if you can't discern what the heck it means, what do you, you know, most people are just looking for that first step. It's in there going, well, here's all 58 of them. It's like, I don't care about those. I just need to know the first one. But I'm so glad you're helping people do that because.

The high level people we work with for publishing their business books, the reason they're not taking a do it yourself course and trying to figure it out is because they value the time, just like your clients. And it's like, hey, let's just pay the professional to do it. You know, they want to be spending time with their family, their friends. Maybe it's working, you know, work, working on some work that will make them even more efficient or more profitable or something. Because anytime someone's like, oh, can I have you do this? I was talking about it on one of the other episodes and it's like if you send me an email and I can reply quickly, it'll. I could, I'll probably turn it around in 24, 48 hours versus 3, 3 to 5 a week later when it's like, oh, we just need you to. And I'm like, this is going to take me a good 20, 25 minutes to do this whole thing and make sure nothing's missed. And I compare it to, you know, I have, I can have an expert like you on the show. And I'm going, what's a better use of 30 to 35 minutes, maybe 45 minutes messing around with this or bringing this to, you know, tens of thousands of people that's a no brainer.

Yeah. And it is, I think it is a real challenge that a lot of small business owners face. Is that, that point at which when do I decide to outsource this to an expert? Because so many people start out in that kind of, you know, scrappy, like, figure it out, get it all done. And when you're starting out, you have to do that. You don't have money.

And it's fun and it's.

Yeah, it's fun. You learn a lot. Um, but I think one of the, we call them blind spots. You know, one of the, one of the blind spots we talk about as business owners try to grow and scale is that they reach the end of their capacity and capability, but they have a hard time recognizing that. And so if somebody wouldn't pay you to, you know, do your accounting, do your payroll, design your website, do your marketing, if somebody wouldn't pay you to do that, maybe your business shouldn't be paying you to do it either, because essentially you are. And you say, well, it'll cost me money to outsource it. Well, it costs you. There's an opportunity cost of you not doing like you said, like, what else could you be doing in your business that would be more profitable than trying to dabble in things that are outside of your capabilities and expertise?

Speaking, writing a book.

Help. Speaking, writing a book, giving an interview or doing an interview.

Yeah, that's where you make money. Yep. Yeah. Each business owner knowing that, what is it that you do? What is that, you know, mix of what you're really good at. You love that really only you can contribute to your business. That's where you focus your time and then you leverage employees or outsourced contractors to take care of that other stuff.

I kind of miss the startup. You know, it's fun to just be like, there's no rules. It's the wild, wild west and just do whatever. It's a blast. But I've told people for years, don't get stuck in startup mode. Because the beauty is you have all this freedom. You can do whatever and there really are no rules. It's like, just as long as it's legal, moral and ethical, go for it. You know, you're starting up.

Yeah.

But at the same point, it takes some time priming that pump. And I even realized it when I launched this show because I was not new to business, but the show was new. And I was like, oh my gosh, this is so cool. I'm starting it up, this and that. And after there Was a point where I'm like, one day I just started going.

Ah, it's time for me to not be doing this. Because I, you know, I don't know If I was 50, 80, 100 episodes in, but that's not startup anymore. So I had to go, okay, maybe give this to my team. And it's no longer not on my plate, but what else can I be doing? And that's where I keep coming back once a quarter. I look, I go, what else could I be doing? And it's like speaking, writing, interviewing, or getting interviewed. It's like, it's not that hard, you know, writing copy. It might not be a book, but writing a copy for sales and marketing.

There'S only a few things I should really be doing. So I love doing this and, you know, like I said, talking to experts like you, because I can do other things, but I best not touch it. I fired myself from a lot a long time ago.

Yeah. And that's good. And that's a, that's a step that's necessary to scale and grow your business. But it's often one that people don't recognize, you know, right away once they get past startup mode. And like you said, you're like, well into growth mode and you're. And then you realize, like, something's not working here. Like, surely there's gotta be a better way. Or I've reached the end of, you know, some people, it's burnout and they just can't do it all. And other people just realize I've kind of creep beyond what I really should be focusing on and, and doing.

Yeah. And there's that time. Not just money profit, but time profit. It's like, what do you do, you know, oh, I'm working, so that way I can bump a. Bump a bum. But what do you do when you get to the point where you're there and it's like, now you have this free time that you don't need to be working, but you created a habit of. You are, you know, that's a realistic thing too. You know, what do you do with that time? What should you be doing with it?

Yep. And I think for some business owners as well, not all, but a lot of business owners have that, you know, visionary mindset where they like to be creating. Like you said, I like startup mode. And you don't have to start another business to have that kind of time and thought in your business. It might be around launching a new product or expanding a service. It's like. But once you get something done. You know, you got to pass it off and then you can move on to creating the next thing and then pass it off. Like if you're going to grow and scale, you don't have to give up being a visionary, but you can't be a perpetual, you know, jack of all trades or you know, kind of scratch, get it all done type of thing.

Well, I'm so glad we were talking about this. I have one more question for you before we thank our sponsor and go to the imperfect action round. And it is the fun wheel of whatever. This was one of my visionary things I created. I was talking about it and then one day I made it, brought it into real life and now I can actually spin it. Awesome, man, I nailed that.

Sometimes it's like it doesn't spin good. Well, whatever. And I know what I want to ask you. See it right there? There's the question right there.

Oh, stop. Okay, cool. My question for you is with your free time, where do you want to travel to that you haven't been yet?

Ah, that I haven't been yet. Where do I want to travel to? So I have a goal with my husband to go to all 50 states together. And one area we haven't been to yet that I really want to go to and I'm hoping to do it this year in the fall is New England. So like the New England states, we have not been to there. So I've got like 13 states left and a bunch of them are in New England.

Very nice, very nice. Well, I appreciate what you're sharing. I'm going to thank our sponsor and we're going to come back for the imperfect action round. You've heard me say every business needs a book, including yours, and it's true. And that's why you should visit freebusinessbookpublishingcourse.com today to learn the seven steps to publish and promote your nonfiction lead and profit generating business book in eight weeks. But you know what, don't take my word for it. Take it from a few of my authors like Lori, I went from having.

An idea and a possibility to actually getting my book published.

Or Catherine, thank you for making my.

Mom number one best selling author or.

Mary Alice, what he got done for.

Me in three days regarding my book launch.

Unmanageable John Cody. I've worked with Mario over the phone and online and he's been very helpful in getting me where I needed to go with promoting my books. Rocio.

There's no way in the world I would have been able to do this with somebody else again. I've attempted it in the past. It didn't serve me. As a matter of fact, I ended up more frustrated than anything. So this has been a very seamless process.

Adele, if you're looking for an amazing business coach, I highly recommend Mario Ficini or Bill Benner.

I can't make a higher recommendation for than to work with Mario Ficini. He has been great for me and right now I won't work with anybody else except for Mario. Hey, their words, not mine. Visit freebusinessbook publishingcourse.com to get started now. And I look forward to hearing your transformation as the next video success story. Once again, that's free businessbook publishingcourse.com and we are back with the imperfect action round. Are you ready to take imperfect action?

I'm ready.

I got three questions for you. And the first one is what is the fastest path to the profits?

The fastest path to the profits? Well, I hate to sound like a broken record, but I do truly believe what we talked about in the in the first part of the podcast interview. Having that information and someone who can help you utilize it is the fastest path. Knowing where you're making money and having someone, whether it's yourself, if you have those skills and abilities, or having somebody who can help you analyze those results, not just having the data, not just having the discussions, but using the two together to truly know how you're doing and where you should focus your efforts.

Excellent. And you don't sound like a broken record. I've. I designed the questions in the show flow and there's times I'm like, everyone always repeats what they said in the first half. But you know what's great about the imperfect action round? When someone's on the show notes page, they might, again with that whole time thing, they, they might just skip. And we have like quick, truncated things like here's the expert authority insights. I love that you said in the first part because they'll listen to this or just read it and go, well, now I got to listen to the thing. So I've thought it too. I'm like, should I change that? It's, you know, in the first and second. Well, you'll see. The second one is what is the biggest problem your prospects are making and what's the fastest way for them to fix it.

Okay, so again, it's the opposite of what you were. Yeah, well. And I think you know what we were talking about with, with those blind spots. And maybe we can talk about a little bit at the end of the show, we've got a resource, a free ebook that your listeners can download for free that goes through all five blind sp. But the one blind spot, yeah, the one blind spot I mentioned of just really not recognizing when you need to get back to what you are most passionate about and where you provide the most value to your business and recognizing that there are other people on your team or outsourced options that can handle some of those responsibilities. That your best contribution to your business and is doing what only you can do to drive the profitability in your business. And for each business owner that's going to be different. But knowing what that is, knowing first the first question, like knowing how your business makes money. And I'd say the second one, knowing how you make business money for your business would be the next thing.

Excellent. Number three, this is actually this one will probably never leave.

What is the best way to maximize customer lifetime value?

So being in a service based business, I think helping clients and customers like having a mind for helping and really knowing your customers and your clients. If you understand the issues and challenges that they face and how you help them and you can continue to help them and show them new ways that you can help them. That is an amazing way to grow the lifetime value of a customer. If you are continuously learning and understanding more about the issues and challenges and needs of your customer and evolving and adapting and finding ways to help them solve those problems, they'll be a customer for life if they know you understand them and you are trying to help them.

Excellent. What books would you recommend to Expert Authority World?

What books? Oh wow. I didn't know this one was coming. So one of my favorite books is Traction by Gino Wickman that talks about eos. We run our firm on eos. That's been a huge part of our success here. I love Building a Story Brand by Donald Miller. Free to Focus by Michael Hyatt. Oh, there's so many I could say, but those are probably three. One more that's really more about emotional intelligence and that's it's about the Enneagram. The Road Back to you by Ian Cron. Those four books I just mentioned have been a huge part of shaping me as a leader in our firm over these last few years. And I think, you know, they don't talk specifically about profitability or finance. They talk about emotional intelligence and managing your time and your productivity and being clear about your message and how you help and how you run a successful business. They're just great ways to have a really well rounded picture of what it takes to be a successful leader and business owner.

I feel like you have a fifth one in there and you just want to get a full house.

Oh, let's see. E Myth by Michael Gerber.

Very good.

We have room for six, so five is perfect.

Where would you like people to learn more?

Courtney yeah, so if you go to tdtpc.com.

There you will be able to access any part of our website, but you'll also be able to download the free ebook that I mentioned where we share the five financial blind spots of companies as they grow and scale. So you can download that. You'll see one of the blind spots that I mentioned in the podcast interview as well as four others. There's lots of guidance there and opportunities to reach out. So if you just go to tdtpc.com expertauthority you can get access to contact information as well as that free ebook for your listeners.

Excellent. Well, thank you very much. It's been a pleasure.

Thank you for having me.

Expert Authority World we have another great episode here today. I'll see you tomorrow. Have a great day and God bless.

You're already the expert, but have you transformed your expertise into a tangible asset that will generate and qualify leads while increasing profit for you 24? 7? And if so, how well are you promoting it? With the Expert Authority Effect publishing method, it's easier and faster than ever. Visit freebusinessbookpublishingcourse.com today to learn the seven steps to publish and promote your nonfiction, lead and profit generating business book in eight weeks. Visit freebusinessbookpublishingcourse.com to get started now. Once again, that's free business book Publishing Course. Com. Hey, thanks for listening to today's episode. I hope you got a lot out of it. I know I sure did. If you haven't done so already, I invite you to subscribe to the show and also be sure to check out eainterviews.com for complete show notes, the full interview video experience, links to the resources we mentioned, and more. Have a blessed day and I'll see you tomorrow.