Episode 69: Significant Cash Ebbs and Flows with Melinda McCaw

Yeah, but the quality. Listen, this one, you can't touch this. That's right.

Oh, getting jacked.

All right, let's get this thing rolling.

You're listening to the Profit first podcast.

And you knew the time would come. The time for episode 69.

Yes. Oh, we've been waiting for this one.

Oh, yeah.

Welcome, everyone, to the Profit first podcast. My name is Chris Curran. I'm the. Sometimes I don't leave enough space between my names. Chris.

No, you don't. It sounds like Chris Curran. It sounds like it's one name.

My name is.

What's your last name?

Curran. Founder of fractal recording.

Your parents, like my parents curse us with alliteration. Where you have to. Chris Curran. Mike McCallow. It's like it's the same letters. They blend so easily. Well, he's Chris Curran and I'm Mike McCall, is the author of Private First. But I am joined in studio by the co founder, my partner in Profit vs Professionals, Obi Ron Kenobi.

All right, everybody.

How you doing, Obi Ron? Oh, there it is. Obi Ron. Obi Ron's on every single GMAP Grow, my accounting practice show, sharing amazing insights. He was busy today. I said, ron, you gotta come on Private First Professionals. He said, okay, I'll come on. But he's like, I gotta hop on a call in about 20 minutes. So hopefully Ron can stay for the entire episode. But I want to get his insights too. On. We have a very special guest we have today, Chris.

Where can people find us everywhere? Itunes, Stitcher, tunein radio. Those are the popular podcatchers where you can hear us and soon to be Google Play. Whenever they roll that out. Of course, our website is profit first, podcast.com, which has all our previous episodes where you can literally overdose your brain with profit because revenue is nice, but profit is nice.

Er, thank you. Yeah, it doesn't rhyme. I gotta think of a better rhyme for nice. I gotta be staged for that. Because all I can think of ever is lice. And that's no good. That's not good.

So, yeah, it's all about profit. Because look, every. A lot of us have businesses. I mean, there's probably as many businesses as people in the United States. But how many are profitable? Not that many.

Not enough.

Yeah, and not enough.

There's, I noticed, 25 million small businesses in the United States alone. Over 100 million in the businesses in the globe. Small business doesn't include the middle or the large corporate.

Right.

I mean, there's lots of companies out there.

Yeah.

And most are not profitable.

That's why people, People tune in here so they can learn the skills from the prince of profit, Mike Michalowicz and his book Profit first, and his business.

Partner, Obi Ron Kenobi. I mean, listen to this. You got the duo, the duo of the century. Chris, what have you been up to, man?

Oh, you know, my business is growing. I think I'm almost close to a point, Mike, where I'm gonna have to reread your book and maybe ask you some advice. Part of the thing is, like, when your business grows and then you realize you're gonna have to bring on more people. But. And we know, like, we've talked before about how if you bring on a salesperson, for instance, they should pay for themselves and more. But what if you're bringing on like a production person, which is just gonna do some of the work? Like, do I change my pricing? Do I up my prices because I gotta hire someone or do I? Yeah. So anyway, that's a question. Maybe we could talk about it after.

We could do a whole show or. Yeah. Maybe do a show around that.

Absolutely.

Right.

You know, it's a, it's a common trap. So we talked with Jonathan Royce last week. Erica. Erica, we talked. Erica Wernick, we talked to a few weeks ago about, from LA Bound. And what's interesting, those are small startup businesses. Inevitably they get to that stage where you got to be changing who you are. You can't be the. The all inclusive entrepreneur does everything for the business. And Robin Robbins I interview. That was fascinating. Here's a transition from someone that started it to go to the larger stage. And the. I think the most fascinating part is you don't have to do it. Like, just because you have a business, it doesn't mean you have to be a million or a hundred million dollar business. If you have a business, you. You have to determine the lifestyle you want that business to provide and how you want to play it out. There is no wrong answer here. The only mistake you make is not defining it in advance.

Right.

So, dude, you know, ever since that interview we had with Jonathan Royce last week, I'm going on this kick now. He's Mr. Go Blue Michigan. I'm Mr. Virginia Tech. You'll notice the paraphernalia is coming in. I got a small Virginia Tech helmet here that holds my pens now. Nice. And I'm slowly. Yeah. Slowly accumulating Virginia Tech gear. Getting ready for next season.

Nice.

I went to a university that does not have a football team.

Yeah. But a killer lacrosse team. That you played for. They were all right. Pretty good when you were there. Of course, the heyday dude, Chris Ron was watching his video, this lacrosse game. Yeah. Guy gets hit in the head by another player, knocks his helmet off. Simultaneously, another player is launching a shot at the goal, but the guy who gets knocked over with his helmet falls off, falls right in alignment with a shot and takes a square shot right in the forehead. Nose.

Yeah, right in the nose. 100 mile an hour shot.

No.

Point blank.

It's the guy.

Twice.

You can't. You can't look away. It's a. It's such a train wreck.

It's unbelievable.

The nice thing is they show, and I think they disembarked the video about it. It's like 10 minutes later, the guys is sitting there on the sideline rubbing his nose like he's okay.

Oh.

Because if you didn't see that, you think it would have killed him.

Yeah, yeah. You die from that. Absolutely. Oh, there's a guy in India, he got hit with a pitch from. What's that game they play? Not basic cricket.

Cricket.

Yeah. He got hit with a pitch in the side of his neck.

Oh.

And he literally. About 10 seconds, he wobbled around, he fell down. He died. That's it.

Oh, it's horrible.

Yeah.

That's why I don't play cricket.

Yeah. Terrifying. But it's a train wreck. You can't take your eyes off it. Like this really happened. I don't know. So I feel kind of bad that I even watched it, but whatever. All right, so as awkward as this transition can be, let's transition to our corporate partners. I want to do a big shout out to T Sheets. Oh, you're ready to go. You say it right.

I'm ready to go.

Lay it on me, T Sheets. Thank you, Fun box.

We love you, fundera.

You're loved.

Next. Tiva.

The bestest of the restest. Yeah. So thank you for all those corporate partners.

Don't you just want to whisper sweet nothings into our corporate partners ears?

I do, I do. They're amazing folks. I actually have a call, Ron. Coming up with. With T Sheets with Kelly over there. They just said they like to come to our Mastery meetup for profit first Professionals.

Nice.

Host a lunch. Nextiva just signed up to host. They're just great, supportive companies. They're good people and. Good people.

Yeah. And when you're working with good people, they have your genuine interests in mind.

Yeah. Yeah. It's totally true.

I just heard. You know Gary V. Yeah. He's doing These new videos, he and I watched one earlier today. He basically said, like in the beginning when he was in his 20s and 30s, like he was just hustling. He'll work with anybody. He said now he actually tries to only work with people he actually likes.

That's. We have a rule here. No dicks allowed. And I will never say the name. Ron's on a phone call with an opportunity for a member to join our organization. Qualified member, meaning he or she meets. Met all the parameters we have. And Ron hangs the phone and says, this person doesn't pass our no dicks allowed test and rejecting them. And I'll tell you, we have a healthier organization because that's not only the only time we've done that. Obi Ron Kenobi. That decision makes an environment here where it's fun to come to work. Right. I can't think of a single day here where we're not like talking about a member, how great they are, how much fun we had. Very, very, very rarely do we ever say anything like, oh, it was just a bad day.

We don't have the cringe factor when our members call us.

Yeah, that's it, right? Yeah, yeah. Like everyone, we're excited to answer every single, single phone call.

If you have cringe factors when people are calling you.

Wow. All right, so this episode, this is becoming a self effacing episode. We're going to turn things around here. We're bringing on a very special guest today. Her name is Melinda McCaw. She is the founder of Melinda McCaw Media, which is a full service web development company. They specialize in custom theme WordPress templates. She's out, Chris. She's out in your neck of the woods out in Colorado, the Grand Junction area. And she's implementing profit first. So we're going to explore what's it like to run a technology and creative company and how it is to run profit first. Melinda, I'd like to welcome you to the show.

Thank you.

I'm thrilled you're still here.

Yes. Thank you for still being on the.

Line with all that banter. I was like, oh my God, she may hang up. Do you ever deal with someone that's a total dick?

Yes. Got one right now that is not my initial client. So I don't have initial contact with them. But it's challenging, but it's been a learning process.

Yeah. What's the effect on your business to have a client? That's a real nasty pain. Yeah.

Well, you get to learn a lot of lessons. The hard way. Sometimes if you don't deal with it in the correct manner.

Do they ever make you do rework or they're not satisfied or they won't pay the bill or any of that stuff?

They are at the point they won't pay the bill until we basically do everything that they're asking for.

So they're holding you hostage?

They're basically holding us hostage. Even though they weren't very clear when they asked for a quote. And so they keep adding things to it. Luckily, though, we've been able to do change orders, but.

Nice.

Yeah. It just seems like every time we get something done, then they find something else. So it's definitely been a learning process. And how do you deal with somebody that acts in that manner? Definitely opened our eyes and we've learned a lot on how to deal with that type of client in the future. I don't think they're really a bad person. I just think that this is the type of client that we haven't run into before. One that kind of really knows what they want. But the only piece that's been really frustrating is they don't seem to know how to clearly communicate that. And it would have really been nice to know that up front, what they wanted completely. So it's been a challenge.

Right. And understanding your customers or your prospects personalities is actually paramount to the success in the working relationship. In previous episodes, we've spoken about assigning people with similar personalities or that understand different personalities so they collaborate a lot better. So if there's somebody in your office that has a better way and is more understanding of working with difficult people, well, then they should be the point person.

That's a great idea.

Yeah. Yeah. You know, one thing we found, too, is that rarely is it a bad. We use the word dick because it's kind of fun and cheeky, but rarely is it a bad person. Is this a bad customer? Because it's a bad match, and sometimes it's navigable, but sometimes it's not. And then we have to have the courage of getting rid of them. Actually, at the end of the show, I'm going to give you a little trick of what you can do to kind of gauge customers. But before we do that, let's dig into your business. Melinda, tell us a little bit. How did you get into doing a business like this?

Well, my background is I had two previous degrees. I'd gone to school first for graphic design, and when I got out of school, I wasn't really having any luck finding the job that I wanted. So Then I went back to school for photography. I was specializing in photojournalism and once again wasn't really finding anything after that. So I went and started working for Sharpshooters, which is a company that specializes in photography at resorts. So if you go to a ski hill, for example, they're standing at the top and you offer to take pictures, no obligation. So I did that for about a year. Just really wasn't going where I wanted to go. So I went back to school for a third time and I attended the Art Institute of Colorado in Denver, took the web design program and just made the right, made the right connection. At school they had a job board and so I would go there frequently because we had required number of portfolio projects we had to do. And so I would go to the job board and I got a job from this one company, redesigned their website and not long after I finished that website, they hired another marketing director. And he came in and basically told the owner we need to redo the website again. So I worked. I worked with him in his vision and we completely redid it. But making.

They didn't get rid of you? He didn't say the first website. Oh, good.

I paid to do it again.

Oh, that's nice. So let's fast forward to today. Where's your business stand today? Give us a sense for the size, the type of clients you're working with.

I now have two employees. One is part time. He's in school for computer science. He's about halfway through his degree. And then I have another employee who graduated from school about three years ago with the graphic design major. But she really had an interest in web design. So I hired her right out of school and she's really grown into an awesome developer and designer. And I've had. She's been with me about three years now.

Did she start part time, by the way? Did she start part time?

She's full time.

Did she start with you part time? Okay, so she went part to full.

Maybe started her out about 20 hours a week and now she's up to full.

Gotcha. How. How many clients do you have?

Well, with web, it's kind of hard.

Because you build how many projects per year then.

How many projects per year?

Yeah, roughly.

See, I think last year 40ish.

Okay, 40ish.

That's fine. I have one. I have one client that's my largest client and he brings in 95% of my business. So I kind of feel like I have all my eggs in one basket. And that's a Little dangerous. So really love to definitely want to keep him, keep him happy and keep growing with him. I've actually been growing with that company because we're basically their in house web development team. They're an SEO firm, so that works out really nice. But we're working on trying to get better at marketing, sales ourselves, bringing our own clients.

And I don't know if you're willing, but we're really trying to get a good sense for your business. Do you mind sharing the revenue you had last year? Because that'll help us get to making your business super profitable if we understand that too.

Sure. Yeah. Last year we brought in 77,000.

Okay.

And the year before, we brought in 60,000.

Okay. This business full time. You're full time for this business or do you do anything else?

Yeah, I'm full time for it.

Full time. Okay. And I'm sorry, I didn't mean to cut you off. What else were you saying?

Oh, no worries. I came across best year ever blueprint a while back last year, and so my husband and I really felt that we should go to that. So we went to that this last December. And we're, we're pretty excited. And we've been working on writing down our goals and what, our action steps, three minutes at a time, and breaking them down into daily goals. It's something we just obviously just started. But our big vision or goal for this next year is to double our revenue and hopefully not.

So 150.

Yeah.

Okay. And let me ask you this. What is your business? What's the impact it's having on people? Why are you in the business? What's the why or do you know?

I don't really have a great answer for that right now. I like to help people and help them succeed. So I guess you could say that sometimes I probably bid projects too low just because I want to help someone out.

Gotcha. Ron, time permitting, I'm going to ask you about the why thing. I know you got to get going pretty soon, so we're going to dig into that in a second, but sure. Melinda, I know you've started implementing profit first. Actually, that's how we got in touch. And you've had some questions about it. What's the challenges you're facing with your profitability and what are the questions you have around profit first?

I kind of have a cash flow problem. So the way I do my projects is I require half up front and half once it's finished and live. And what I run into typically is we'll get A bunch of projects done and ready to go and out for review at the client. But then it just, we're waiting on the client and sometimes they're not timely and getting back. So you might get paid one or two months after when you really wanted to get paid because you haven't been able to go live yet because they haven't approved your project. So I get months where I'm barely bringing in enough to pay the payroll and then I get huge months where like everything stacks up on each other and it's like, wow, I just brought in three or four times as much as last month. And those are great. But you have to save your money for the next two months that are dry, you know, so.

Yeah, so that's a great. Let's tackle that challenge. And Ron, I'd like to give you the floor I know you've thoughts about before you go.

Yeah, there's a couple of different things that, you know, I hear that's going on there. One is, you know, how you're getting your money. All right, Half up front, half at the end. The recommendation that worked for me in the past before would be half a quarter and a quarter. That way you getting a little bit more of that midway through the project and it should be able to stretch out over there. Additionally, one of the things that you might want to consider is having a timeline and a timeline with penalties on it that are if you're delivering your product, your designs, your client needs to respond accordingly in a timeframe. Okay. So if they're in, there needs to be penalties if they're not, because they're just causing you more pain and aggravation. So in your contracts, do you have anything like that that says, hey, listen, this is your responsibility, these are your roles, this is how it's going to be a win win for us.

I do not have any sort of timeline with penalties. No.

Okay. I like something you might want to consider.

One question for you with that timeline with penalties. I have one client, my largest client, who we actually, we've just worked together for like forever and he's never stiffed me or treated me badly. So we just don't even do contracts for each job. I'm like, he's sending me four, six jobs a month and we're just cranking them out kind of thing. So.

Right. I wouldn't.

Would I just like have a verbal kind of.

Yeah, that. I mean, I wouldn't. You know, what with a, with your number one customer, long standing relationship, you don't want to upset the apple cart. So, you know, every new opportunity that you have, you can implement this.

Okay.

You know, your mom used to say, everyone's created equal. Mom's a liar. Mom's a liar. There's some marquee customers, and you. You treat the best better than the rest.

Absolutely right.

You know, and just building, Ron, on what you were sharing about the half, quarter, quarter. That is a common practice where the final percentage due to you, maybe 25% at the end, is purely a profit. But what you do is the half is. Would be on kickoff, the quarter on the completion of a certain phase without the contingency of the client, because the client. You understand, you're a Financially motivating the client to take their time. First of all, naturally, they're slow and sucky anyway. They have the right content.

Forget that.

So they take their time. But also, you're motivating them to take time because they don't have to pay the bill till they do. So there's a little bit of a risk with a penalty. If you say, hey, you're taking long, it's going to cost you more. There's a negative association. So if you can instead have the trigger dates be associated simply with the completion of your phase prior to them having to do something, you're going to cushion things a little bit there.

Yeah.

And the penalty doesn't have to be. It could be 0.05%. It's just more of a, you know, line in the sand saying, hey, we need you to give us the final decision by this date.

Okay.

Yeah. Yeah. So. Okay. So that's a great question. Yeah. Ron. Ron's got a bolt.

Yep. I got to go, everybody. It was a pleasure, Melinda, you're in great hands here, and I look forward to hearing this and better success.

Yeah. Cool. All right. We're still digging into the show, but that Obi Ron Kenobi, like a true Jedi, he's off to. He just. He gives his wisdom and then fades into the force somewhere.

He's off to battle the sith.

Exactly. So, okay, Melinda, so that's phase one. So. And by the way, you can address cash flow issues in a big way simply by changing the terms of your agreements. Like we were sharing. What other challenges are you facing? With profit first.

With profits first itself or just in.

Your business in general? I mean, with the profitability of your business. Yeah.

Right. Just curious how you know when to hire your next employee, like, when you've gotten to a point that you should. I mean, that's a lot a Lot more financial responsibility to take on.

So a lot more. And an employee is typically a fixed commitment. And you're in a variable business, meaning if you don't sell a project today, you still have to pay your employees no matter what. Right. So that's a fixed expense recurring versus a variable revenue source. So there's a danger associated with that. Here's a couple tips. The general rule of thumb is a profitable business in a service industry will generate $150,000 of revenue per full time employee. So I can, just by looking at your numbers, you have 77,000, you have one full time employee plus yourself and one part time employee. You have to be at $300,000 in revenue. And before that, next hire could be fully, fully justified. Now if you're on a growth track, I want to see you past 150,000 in revenue before you make another single hire. So you got to double your business. Now here's the crazy thing. Your big goal for this year is to double your business. My challenge to you is how do you double your revenue? And yet without changing anything with your hiring structure. And you may not been thinking that way, but why don't you start thinking that way now? Because if you hire another employee today and you get 150,000 revenue, you've added a lot of what I call stress points. I call top line revenue stress points. By the way, the bigger the top line is, the more revenue you make, the more stress it puts on your business, the more stress it puts on you as an owner. But you're not increasing your stability points. That's the profit. So look at it from that perspective. How do I get to 150,000 with one full time employee? Then at 300,000, I'll give you permission to get another full time employee. Okay? Now the question made that come up is, well, how do you do that? I suspect again, this is, you know, we're talking for 15, 20 minutes here. I'm making an analysis. But I'll tell you, I've coached lots of businesses. I suspect it's pretty accurate. I suspect you're not charging enough per client. I suspect you're not charging a premium per client because the volume of work you had 40 projects, 77,000, those are small projects. I want to see a premium. So my other question for you is how do you double your fees? But it's got to be justified and fair. But how do you double your fees? What are the things you're doing that truly makes you distinct? What specialty services are you already providing that really, no one else does. So you can honestly increase your fee structure, but be still fair to your customers because you're not being fair to yourself.

Right.

Does that make sense? Okay, here's one other thing I want you to consider. It's very true for many businesses, especially in the early stages, that the majority of the revenue comes in from a few clients. You're in a good and bad situation, a risky situation, that you have one client that generates 95% of your revenue. If they decide tomorrow that they're not going to do business with you, that will put your business under, or you got to lay everyone off and go back to day one very quickly. That's very risky. You know, conversely, it's easy to manage just one client. As long as you keep strong rapport going, there's no reason not for them not to use you. In a case like this, I would suggest that you consider a contractual obligation with them. And basically the approach is this. I go to my best client and say, hey, we love working with you. It's a wonderful experience. We are devoting a lot of resources to you and intend and will fully do the same thing. But we want to know what we're working with you for the long haul. We like to put, if you agree, we like to put together an agreement that says that you'll be committed to working with us for X number of years as long as we achieve certain minimal parameters, and we'll reduce the cost. If you're willing to make that commitment now, if you don't want to, we totally understand that too. And the price structure will stay the same. The thing is, you're in a very risky situation here. And I'm never, never a fan of reducing prices unless the life of my company depends on it. And so I just see this risk sitting out there. And that's one little trick I do to secure a client, and then I make sure I wow them and care for them. But at the same time, I'm looking to expand my customer base so I can get a little more revenue diversity. I don't like to go into different markets. I don't want to have diversity in my offering. I like to be a niche specialist. But I definitely want diversity in my client base and revenue sources for my clients.

That makes sense.

And I'm just kind of, just kind of spewing ideas here. But I want to give you one last tip. Before we got a call today, when you made that big vision of yours, you didn't. Did they call that the bhag by Any chance the big, hairy, audacious goal, that's a common term that gets floated around?

Yeah, yeah, yeah, they did.

Okay, so bhag was a term invented by Jim COLLINS Back about 20 years ago in a book called Good to Great. And he uses this term and notes that businesses, the most successful businesses, have a big, hairy, audacious goal. Well, and then he cited many businesses that were successful. Unfortunately, many of those businesses subsequently have collapsed. And so Jim's come out with other books and stuff explaining kind of a new perspective on it. Well, I heard another author speak to a concept not called the bhag, but he called the big bang. And this is what's resonated with me and I think is the game changer. Bhag stands for big, hairy, audacious goal. It's the selfish thing we want for ourselves. That big number we want to hit. What do we want to experience and feel? And that's so critical, it's so important, but it misses one thing, the purpose. Why are we doing this beyond money? How is it filling our needs and societal needs? How are we giving and contributing? Well, its author said, we need a big bang, and this is the one I love. Big bang stands for the big, bold, audacious, noble, noble goal. And you see, when we bring nobility to what we're doing, when we're bringing contribution to what we're doing, as our business goes through the. The values and peaks every business does, it will drive through the difficult times because we're doing something noble. With my company, the reason Profit First Professionals exists. Yes, it's to be a profitable business. Yes, it's to put the food on my table, my colleagues, tables. My partner, of course, is to support our life. But more importantly, the company exists to eradicate entrepreneurial poverty. We have a very clear mission, a noble mission that we're trying to do. We want businesses like yours to be wildly profitable because we know that if you're successful, your employees will follow suit in your financial stability and they'll replicate it. We think we can eradicate poverty by first eradicating entrepreneurial poverty. So that's why we exist. Your homework assignment is to spend time with your husband or yourself and get absolute clarity on the why, what's the greater means? You're definitely doing it. You care for clients. You're willing to cut prices to care for your clients. I just want to know why and put it to words. Because once we have that, it becomes a magnet that pulls you forward. And I think achieving your goal of 150,000 becomes even more realistic, even more attainable when you have that reason why behind it.

Okay, awesome. Yeah, that's great. Thank you.

Cool. Well, Linda, hey, it was an honor having you on the show. Please keep me posted via email. Christina's going to check in with you too. We want to share updates as you move along in your business, but we want to hear what you're doing. And thanks for being a fan of profit first implementing it in your business. I'm wishing you a very profitable 2016 and every year forward.

Thank you. Appreciate it.

Okay, thanks. I'm cutting you off there. One last question, people. The listeners in right now, they need web development. You need a cool website, Melinda, where can they go to hire your company?

They can go to our website, melinda mccawmedia.com and get a hold of us there.

Yes, everyone go to melinda mccawmedia.com and be that number two great client for her. I suspect she will cater to you personally. Very well. All right. Thanks Melinda.

Thanks, Melinda.

Thank you.

All right, great job. And by the way, we'll have that link on the show notes as well.

Yep. And oh my God, I can't believe I almost forgot to ask her about that. Chris, I want to ask you what you learned from prior to that. I first want to thank our corporate partners that make the show possible. You know, companies like Melinda's early stage companies. And we talked to all companies of all sizes. Listen, we had a $10 million company on a few episodes ago sharing their experiences and stuff. And we've had 10 million dollar companies that are struggling to get by and get started. There's companies of all sizes. They all benefit by catering to and specializing in profitability. This show, for it to sustain it must be profitable too. And how it's happening is through our corporate partners, the folks that support us because they want to serve you. They are Nextiva. It's a voiceover IP phone system. If you're a small business with two or three employees like Melinda's, if you have 20 or 30 employees, Nextiva has a voice over IP system that can scale with your business. And the cost structure is applicable to the tiniest of all businesses, to the largest of all businesses. We've used Nexteven here. We got 12 phones for our five employees because we have multiple locations, we have our office and they can work virtually and all that flexibility and it's the cost of like a home based phone system. It's so affordable, but with the ultimate in flexibility. Fundera, if you need funding for your company, and now here's the type funding I'm a fan of. If it makes money, it's making profit for you. Invest in doing more of that. If it's working, do more. If it's not working, don't do it. But if it's working, invest in it. And if you need funds to invest and grow, Fundera is a one stop shop for that. And of course now if you have clients that aren't paying you on time, Melinda suffered this. You know, one thing Melinda could consider is going to a company like fundbox.com as an alternative. We didn't bring up during the show, but when Melinda's waiting for that remaining 50%. But her client is the problem. The client's the ones holding up. She can get those funds today by making one call to Fundbox. They release the funds to her in full. And then when the funds come in from the client, when they finish their project, she returns the money to Fundbox plus their service fee. But it's a very great way of navigating cash flow. She has a payroll due and that money is justified. And due to her, this is the way to get access to that money immediately. And of course, the last but not least is T sheets. T sheets is time tracking software. Any service based business, Melinda is a great example of it needs to track their time. How much time are my people spending on certain projects? You know, if you got a report to the government at year end where you're allotting certain time for certain reports or maybe you got to report your clients, how you're doing your projects and so forth. Tsheets tracks that it even tracks. We have a plumbing company that uses it. One of our first professionals is working with plumbers and his plumbing company. They track when their plumbers arrive on site and leave a site and track how much, how long they're on site. And the plumber doesn't have to do anything. Tsheets, using the GPS software automatically just registers their arrival and departure and then enters the time at the client site. Pretty cool stuff.

Love that, dude.

I can ramble on about our partners all day long, especially because they're, they're paying ticket the bill here. But Chris, what do you, what did you learn from today's episode?

So I liked a lot of the advice you gave Melinda and I also liked the fact that she, you know, she said she went back to school three times and she's definitely on the artsy side of the spectrum. She's a creative person. She's not a shark, she's not a business Person. Right. I mean.

Right.

That's not her core trait. But I really like that she genuinely wants to do great work for her clients and that means a lot. So I think she's positioned well. I think, you know, overcoming the business items is totally doable because it's more just logical and, you know, cold, hard thinking. I mean, someone who's not a graphic designer can't just step in and start designing cool things.

Right.

If it's not in their nature. So I think she's really positioned well and I think she has the right attitude of wanting to do a great job. I mean, I think, I mean that again, we usually always take that for granted, but that was very strong with her. Just like the Force is very strong with Obi Ron Kenobi.

You know, I love that Obi Ron could peek in and see, listen. He is a saying, talk about profit. He calls it closest to the money. He's like, hey, I want to drop, drop in on the show, but I'm going to walk back out. I got a prospect, prospective member on the phone. I want to talk with them. So, you know, what makes your business sustain, what makes your business profitable. And you've got to prioritize, and you should see it as an everyday discipline. Profit is not an event. It doesn't happen one day after something. Profit is a habit. Every moment, every day, profitable decisions, the micro decisions add up. So that's what Ron's doing. I like two things. She did a success blueprint, I think the term is she's used, or she went to some event where they made a blueprint. You need to do the visioning. The other part though is you need to do the execution. And I can't tell you how many people I count do this great vision. They're all excited and they get back into the weeds and the business unwinds. And the next year they go through the same process, fired up, nothing. It's the New Year's resolution of all entrepreneurs, right? You get all fired up and then you go back and you don't work out, you don't exercise. So step one is, what is your blueprint? What is your vision? Have that calling card, what I talked about, that noble goal. What is pulling you forward? What's the purpose you're serving? Greater than making money. Why are you doing this? How does this tie into your own life purpose? But the second thing is you have to have the daily execution. We gave you some tips through this show about what will make you profitable. There's one thing I alluded to that I didn't share yet. That she kind of triggered in my mind that we all need to know. You need to sort your customers. And there's a real simple sorting system I have. Write this on a piece of paper. One, two, three, rank it. One's first, two, second, three's third. Number one, list all your great customers. So anyone that is a great customer pays you well, you love doing business with, you get paid on time or early. Those are great customers. Number two, just write the word no customer. Then number three, write down all the bad customers. The ones that aren't satisfied, don't pay in time. Actually never pay. You are difficult or pain in the butt to do business with. Do you know that's the ranking of the quality customers? It is better to have no customer than a bad customer. That customer that's horrible to do business with and doesn't pay you. They're costing you to be in business. It is better to have no customer at all because that avails you the one critical resource that you can't get anywhere else. It avails you time. And time allows you to serve your great customers even better and find more customers like them. So do that ranking system. If you have customers that fall under number two, it's time to get the courage to move One, rank up and go to no customer. So you can avail the time to find those good and great customers up top.

And I always feel like we need a sound clip after.

I'll give us a sound clip.

Yeah, please, could you.

Here, this one's appropriate. Smoke weed every day. My monster kills. My new favorite one. That's the one I want to hit after.

There you go. So this has been a great episode. I really want to just mention that you can find our show on itunes and Stitcher and tune in radio and of course the website Profit first podcast dot com. All our previous episodes there and all the links to everything, like anything we talk about in any of these episodes. If you go there, there's links to everything. So it's a. It's a really great resource and yeah. So appreciate you listening. If you have any questions about podcasting, you can always ask me. Go to fractal recording.com and of course, the. The empire that Obi Ron and Mike are building is called Profit First Professionals. Mike, right?

Yeah. Yeah. I want you to visit the site and listen if you. Hey, maybe you want to come on the show. We'd love to diagnose your business. Dig in. Listen. It's not necessarily a fun process, but it is a big relief. You know, we evaluate your business, and we give you direction. Come on our Show. Go to proffersprofessionals.com, click on the contact button, and join our show. But here's the deal. I don't care if you want to be on the show or not. I want you to be profitable. And we are willing, we're excited, we're pumped to help you out. Same website, profitfirstprofessionals.com. click on the find button up top. We will find you someone that's in your category, in your industry, that can support you and help you guide your business to the highest degree of profitability. These are experts. They're accountants, they're bookkeepers, they're business coaches. But that's the easy stuff. They have mastered the methodology of making businesses profitable using the profit first method and will help your business achieve levels of profitability like you've never experienced before. And you deserve it. So go to profitfirstprofessionals.com right now, click on the find button, and we'll help you out.

Yeah, what a concept. Professionals that normally just add up numbers for you that can actually help you be profitable. Geez, what a concept.

Yeah, your computer does that now. Buy QuickBooks, get a copy of Xero, use FreshBooks. The software is doing the number crunching, but it's not giving the guidance for. For the strategic moves you need to make to make your business more profitable. That's what these professionals do. We love it.

Thank you, Mike McKowicz. Thank you, Oberon. Thank you, Melinda. Thank you for listening, everyone. We really appreciate you. And of course, our corporate partners.

Ooh.

We'll see you next time, everybody.

We'll see you later. Here's to a very profitable 2016.

Sam.