The Secret to Leveraging Sales for Profitability

This is responsible for a tremendous amount of growth and revenue and profits. In every company that we have, we go through these exercises. It's just so helpful to do this kind of stuff.

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This is Business Lunch with Roland Frazier and Ryan Deiss. Hey, business owners, I've got a quick question for you. Do you feel like you're missing the data you need to make strong business decisions? If so, it's probably time to build a CEO dashboard. It's an easy way to get everyone in your company literally on the same page, focusing on the numbers that matter. So the scalable company put together a free spreadsheet template that will give you everything you need to deploy your own dashboard. And to make it even easier, Ryan Deiss recorded a short training on how to use it. If you want to get your hands on the template, go to businesslunchpodcast.com dashboard that's businesslunchpodcast.com dashboard and you can download it for free.

So we're going to talk about how you can double your money, basically your take home. And this is where we are on our journey of the seven levels of scale to achieve what we call scalable impact. And I'm going to talk a little bit about the model that we use to do this, but the first thing you went through earlier, building that growth flywheel is helping you to get leveraged sales. And I'm going to really dive into leverage sales and talk about how can we get so much more from the efforts that we're putting in, in the, that we receive from those efforts. How can we increase our profits? Right? How can we get profits bankable, meaning not just profits that we have to plow back into the company to allow it to grow, but bankable because we're getting larger distributions and hopefully also we're increasing our profit margin. And then last but not least, how can we create true transferable value? Transferable value by separating and augmenting the business identity from yourself, which is a key thing because if you are the business, that doesn't work. If you're the brand, it's really hard. People have done it. Kendra Scott is a great example of that. She basically created an entire empire with, with her name. But if something happens to you along the way and then when you go to sell, very often that can be a challenge for you. So having transferable value that you can actually take out of the company, you can transfer to somebody else, and it doesn't diminish because you're no longer with it. So this all fits within what we call the SPV model and S sales, P profit and V value, all of them are interrelated. And this is kind of how it fits within the seven levels of scale. The next step of upgrading your operating system and then doubling your take home falls into the bankable profits side. And when you have both of those things, you actually have the ability to get momentum because you have profits that can feed reinvestment into sales and can feed you and your bank account at the same time. Without a profitable, you're on a Runway. That's the Silicon Valley model, right? We're going to put some money, we're going to go out and raise some money from our friends and family or some investors and we're gonna hope everything works out before we hit the cliff that ends our company. Because we don't have any money anymore. If we don't have bankable profits, then we don't have momentum and we don't have optionality. So that can be a challenge. So let's talk a little bit about how we can get those leveraged sales first and the leverage sales obviously contribute to profit. So within Founders board, we've got 196 different accelerator tools in our toolkit. But this is really cool. And it, it's built off of our friend Jay Abraham's. There's only three ways to grow a business. You can get more customers. You can have them buy more frequently, or you can have them spend more per transaction. Now that makes sense and that's great. The question I've always had is, well, how do I get more for that? How do I actually leverage that? So the very first thing is, how do we leverage this customer acquisition? Okay, we know we can get more customers. If we get more customers, we can grow the business. How do we do that in a leveraged way? And what are the KPIs and, and in this case, for leverage sales, we're gonna be looking at our customer acquisition cost. Cac. That's one of the things that you'll get asked right away when you start talking to private equity or funding people or other people that might be looking to acquire or invest in the business. What's your cac? What's your customer acquisition cost, and what's your DPL or your dollars per lead? So in that category, we've got new paid channels, so we can actually go out and say, how can we get leveraged sales? Well, all we have to do is add a channel. If we add a channel, then that's a paid channel, then that's going to get us additional customers. Ideally, are we taking advantage of all the available channels? This is how are we going to do that with paid media or with affiliates who go out and do performance based sales? So those are effectively another form of paid media affiliates. You're basically not paying until they sell. So paid media and affiliates, and then the way that you're going to have that be available to you is gonna be through ads or an affiliate network. What do you need to do that? Well, we have a tool that we use called the traffic channel grid. But the short. And there's like 70 different sources of traffic on it now. But the short thing there is just making a list of all the channels that you maybe should think about going after. And there's some really great tools that are out there, like SimilarWeb, that will analyze where your competitors are getting their traffic so that you can fill in the gaps. You can say two biggest competitors that are growing the fastest are using podcasts and Bing. And so we're not there. We should definitely think about that. So that's a really good tool. It's expensive, but it's definitely worth it if it fits your budget. So this is just saying, what are all of the places that we aren't right now where we could be paying to grab new customers and leads? The next would be acquiring customers in bulk. So this is typically done through some sort of acquisition. You're going to acquire some other entity or some other assets. And this could be intellectual property, it could be SEO sites, but it's some asset that already has a whole bunch of customers. The easiest way to think about this is you go buy another company that's got as many customers as you do, you instantly have twice as many customers. The way that we're going to accomplish that is typically through a stock purchase agreement or spa or an asset purchase agreement, an APA as they're referred to in our world, which is. Or some sort of license where you're gonna acquire the rights to sell other people's stuff. And the things that you're gonna need to do that are gonna be some sort of capital or some sort of debt, or the way that we like to do it in EPIC is $0 out of pocket. So those are the tools that are gonna help us get those kinds of leverage sales around customers in bulk. And then last but not least, in this category would be organic lead clusters. So where so socially and other organically wise are our leads right now that are not acquirable through money. So this is going to include social media, that's organic, organic SEO, pr, those kinds of things. We call it borrowed media and earned media. And then the tools that we're going to use to do that would be JVs, partnerships and creating content. Because content is really critical to get that kind of leverage. The tools that we'll need there will be for us to be or to tap into a center of influence or COI and to use some trust agent, which might be ourselves. It might be logos or brands. Tai Lopez has done a good job of acquiring what we call zombie brands that have kind of died, but they still have customer loyalty or brand recognition because there's been a lot of money that's been expended in advertising and promoting them over the years. And content, those are our tools that help us get that. In the next category we've got leveraging the transaction size. So how. What are the leveraged activities to get each transaction that our customers have with us to be greater? So a few of those KPIs, by the way, are average order value, AOV and gross margin or GM. The other thing that we can do is we can get a margin enhancement. We can have a more effective transaction because we are just more profitable in how we do that. So the three things there would be adding other people's products, that's opp, or other people's services. What are the services and products that other people have that we can tack onto ours that we don't have yet so that we can increase our transaction size. That's a great way to. And we're leveraging that. It's a great way to leverage it because we're leveraging that effort that that other company or person went through to create those products or services. We don't have to do that ourselves. We might, as we do, test those other people's products or services first and then find the ones that are most appealing to our customers. And then we might create or acquire those. That's a really good way to source deals. So any of you that are thinking, how can I go about acquiring things, start testing affiliate offers with businesses that you've already got and see what your audience is hot for and then go acquire those things and you'll already have the relationship because you'll be an affiliate. Right. It's kind of an easy way to do acquisitions. So the tool there, it's Just a super funnel. That's. That's what our friend Frank Kern calls it. Right. It's just a funnel that goes on till they buy or till they die, as they like to say. Right. So the thing that you're going to be doing there too, the need that you're gonna have is some sort of upsell or downsell offer that will be other people's products or other people's services. The next way would be how can you get larger orders? Three very common ways to do that would be to bulk bundle or multiple. Right. So bulk offers, meaning that you're going to say, hey, buy a whole bunch of this stuff at one time, like ingredients or fungible items. Or you might say, we're going to bundle these unrelated items together into something that we're going to give you a great deal on and you're going to therefore spend more money with us. Or we're going to give you the offer to buy more than one of something at the same time of the. Of a related thing. So this is upsells and cross sells is how we make that happen. And then typically we're just aggregating our house offers in some way that is going to allow people to buy more and we're making it appealing to them in some way. Then the third way that we're going to leverage transaction size is we're going to expand the value change. So this is a margin enhancement. This is we're not making enough profit right now because we have other people in the value chain who are making profit themselves because they've got their own businesses. They're entrepreneurs, too. Well, how can we consolidate the profitability in the value chain in our favor? The easy way to do that is through what they call vertical or horizontal integration, which is a fancy way of just saying, let's acquire the people who are above us and below us in the supply and distribution chain that's vertical, or the people who are sitting adjacent to us because they are effectively our competitors, whether it's a direct competitor or a replacement or substitute product or something like that. Right. So how can we consolidate this profit leakage that's going away because of these other people who are kind of taking it away from us, whether vertically because we're paying them something to sell it, or we're paying them some profit when we buy, or horizontally because they're competing with us and they're siphoning off our customers or potential buyers. So the way that we're going to acquire that, a familiar way, a stock or asset or entity purchase agreement, apa, SPA or EPA or a license. And to do that, as I mentioned before, we need capital or debt and or zero dollars out of pocket. And then last but not least, which is how do we leverage the frequency? How do we get people to buy more often in a leveraged way? There are a couple of KPIs there there. We're looking at typically recurring revenue of some sort. And we're saying how can we do this by controlling churn or the amount of people who are falling away from buying from us on a regular basis. And that might be through recurring revenue or just they're going away as a customer because they forgot about us and we're not top of mind, we're not staying in touch with them. The second KPI would be LCV or lifetime customer value. And then if we have some sort of SaaS or subscription service, monthly active users MAU, because we want to know how many people are actively using this thing that they are buying from us. Because if they're not actively using it, then they're not likely to continue to do it for very long. So the things that we're looking for here, first is we can create recurring revenue. We can create our own recurring revenue. So this is easily done typically through some sort of auto, ship or rebill or subscription service. Sasses and subscriptions are the most common ways that we achieve that. And to do that we need some sort of consumable or renewable item that we are selling to our customer. Some sort of consumable or renewable. Consumable, meaning it's like toothpaste. We use it every day and it goes away. Or it's minutes that we have on our phones or something like that, or it's credits towards the use of something that we provide them or it's renewable, like a subscription. Okay. The second way then would be we could buy recurring revenue from somebody else. That's familiar now because it's in all three of these different leveraged items is we can go and we can acquire existing monthly or annual recurring revenue from somebody else that's already got it. That's kind of a great way to do that. Stock or asset purchase agreement or license to do that. And again we capital debt and $0 out of pocket. And then last but not least, we can go and borrow recurring revenue from somebody else by outsourcing it through some sort of partner strategic partnership, some sort of affiliation or license. And the way that we're going to accomplish that is with other people's products and offers. So this is our 3 by 3 by 3 leveraged sales matrix. If you do a couple of these things, you will absolutely dramatically increase sales, which will give you more bankable profit, which will allow you to 2x your take home pay. So let's look at a couple of examples of this just because I know it's a little bit theoretical at this point. Leverage customer acquisition. One way would be these new paid channels to add a channel partner so we can add a channel partner for us. We added a channel partner when we cut a deal with infusionsoft keep to do the double your sales program. So they were paying for and still are paying for us to advertise. We're managing the ad spend and we're rev sharing co regg ing the customers so that they get the leads that come in, but we get them too and we don't have to pay for them. That's pretty cool. So that enables us to leverage our sales through a channel partner. You can also acquire customers in bulk. I mentioned with the stock or asset purchase agreement or license. For us, DIY Projects was a Facebook group that we acquired that had a quarter of a million Facebook followers and we blended that with our existing DIY ready group to make a half a million leads in one group. Avent, which is out here is a deal that we did with a SaaS company where we acquired customers in bulk because we acquired part of that company and then we were able to acquire all of the customers that they had as part of that. WeGodago is a stupid name, I think, but it's one of ours, so I got to love it. But WeGodago is a pet products company. So in that company we are acquiring up and down the supply and distribution chain. So we have acquired manufacturers, we've acquired distributors, we've acquired Facebook groups. So we're all up and down the supply chain getting higher profits for us from that. And then our friend Pete Vargas, we helped acquire a thing called Platform University. And Platform University from Michael Hyatt was his biggest affiliate and he was paying them over a million dollars a year in affiliate commissions. So when we acquired it, we effectively not only got that million dollars, that was 100% loss of profit before. Right. It increased our profit immediately by a million dollars, but also were able to cut other affiliate deals plus the profit that it was making from other things. And so that was a really great way for us to acquire a whole bunch, actually tens of thousands of customers in bulk for organic lead clusters using borrowed media. An example would be we Have a mastermind for e commerce companies. And we have a bunch of services that we do for them. But we acquired a Amazon ranking SaaS called Rank Falcon. And Rank Falcon gave us 6,000 customers that we can then put into advanced seller masterminds or advanced e commerce seller masterminds and workshops and accelerators. So we just basically make one SaaS acquisition. Now we've got about 6,000 customers for our $5,000 intensive and accelerator. That then leads to a $30,000 mastermind that leads to all kinds of equity in those companies. We're really leveraging our ability to get customers because we're just looking. Where are our. There are lots of them already for transaction size for us, adding other people's products and services. Partner, affiliate or acquire. Couple of examples would be through our friend Daymond John. We get referrals to products that he does that he elects to do deals with. On Shark Tank, one of those products was called Spy Escape. We did millions and millions of dollars in sales on that. We were able to increase our transaction size by adding that to our funnel. Also prime corporate services for all of you that are in epic, we offer a free SPV to anyone who's located in the United States. No service fees. You only pay the government fees. And then that PCs also offers other services. If you take advantage of those other services, then that allows us to have a higher transaction value when you spend with them. And then Survival Cave meets would be another one. So Survival Life was a company that we exited not long ago, but we were selling to survivalists and we found that they were really interested in having food that they could get and consume that was canned. And canned meat, which sounds really horrible to me, is really popular with survivalists. Right. So if I have to eat canned meat to survive, I'm not sure that I want to survive. But. But anyway, it was super popular and we tested it as an affiliate offer using someone else's product that they'd already gone through, all of the FDA and all the other stuff and the investment of a factory and all that kind of stuff to create this. And so we were able to increase our transaction size Effectively take a 50% affiliate commission, adding that on funnel that we already had, generating profits, the next thing would be having larger orders. So this is the bulk bundle and multiply. Some things that we did there for Big Block Realty, which real estate company that we own an interest in, and that's got about 11 or 1200 agents. That's a traditional real estate brokerage. We created a marketplace. So we went out and said, what are all of the products and services that somebody is going to buy at before, during, or after the time that they are doing business with our real estate agents? And let's create a marketplace. So we went out and cut deals with all of these people for affiliate commissions. So anybody that comes in and buys a house through Big Block Realty gets the benefit of all of these services that we know they're going to be buying anyway. But all of these services we've got deals with. And so when we give them access to our marketplace, we make a whole bunch of money getting commissions for affiliate sales from anybody that buys from them. So that was a way for us to leverage that to get a larger order. Another was our certificate bundles. So at Digital Marketer, we have certificates that cost a certain amount of money to buy, but we offer you the ability to get a deal when you buy more than one, which increases the transaction size. Right. T shirts. We found that people who buy T shirts, surprising to us, but a lot of people, a lot of people would like to buy more than one whenever they buy one. So when they came onto our site, again, that's another business we exited. When they came into our site and bought T shirts, we were like, want one more? You know, and then we ended up offering them, I think, the ability to buy up to, like, 20 more. And it was surprising how many people, almost everyone wanted more than one. So that was just like money that would have not been there for us had we not taken advantage of that. The third way is expanding the value chain. This is through vertical integration. The example I'll give you here is Banana Bay Tactical was a company that we acquired here in Austin. That's a retail store that gave us retail distribution for our Survival Life online company, as well as access to a lot of other customers and a lot of brands that they had brand relationships with. For our pet toy company, we bought a Facebook group of about 175,000 dachshund lovers. And that enabled us to have instant, instant larger transaction sizes for our. For our company. By adding all of those people and all of the toys and things that they wanted for their dachshunds to the offers that we were having, as well as offer a paid membership option. And then last but not least, Everbowl, which is a chain of restaurants, there's, I think there's like 150 of these franchises around right now. We basically were able to go in and Jeff Fenster, who's the brilliant founder of that, said, you know what My very first Everbowl franchise that he built for somebody else cost about $260,000 to build out the store. He's like, that's crazy. I can just get this stuff, templatize it, make it modular, put it in a truck, install it within a couple of weeks and he cut the actual cost. I can't say what the actual cost is, but the actual cost is under $100,000. It's way under 100,000. Okay. So we were able to vertically integrate so that we are having more profitability now because we don't have to pay hundreds of thousands of dollars and wait months and months and months for installations going into the leverage buyer frequency to create your own recurring revenue for new products or services. You've seen us do a lot of that. We've had all kinds of associations and buyers club. FPA was the Family Protection Association, Diem Lab certificates and continuing education now. So you pay to continue to be able to use the license and say that I'm up on this, I'm certified. And then a supplement company we have for pre workout that my son started, Ouroboros, that's just simply auto ship for buying recurring for us. We acquired True Conversion, which is a software SaaS that allows you to track analytics on your site. And sales event, which is out here is a webinar company. Recurring revenue, Rank falcon, same thing, SaaS. So lots of sasses. We love sasses. We love the valuations, we love the recurring revenue. The then borrowing recurring revenue outsourced. So TNC did this when TNC started and again we've exited tnc. We still have a small interest in it. But TNC partnered with infusionsoft to receive affiliate commissions for everybody that signed up for infusionsoft at the TNC booth, which we still to this day, and that was like 10 or 12 years ago. We still to this day get commissions on that at Digital Marketer. We're doing the same thing with Key. Right. So there's a lot of ways that you can do this. So what I'd like for you to do is to figure out how you can do this for yourself. So will you add a new media channel? If so, one paid media channel that you're not using now that you think makes sense for you to add. Hopefully you've seen some sort of data on this because a competitor or somebody else is having success with that and one partner that you might partner with to give you access to new media. So here you might say, I'm going to advertise on a podcast and then I'd like for you to say which one and why. Might be Business Lunch, which is one of ours. Why? Because it's amazing and you'll make a ton of money. Customers in bulk. One asset or company that you would acquire, Right? So it might be acquired. Digital marketing agency. Okay, which one? Why? Organic lead clusters. What's one borrowed media that you can use a center of influence or trust agent or somebody else that's already aggregated the attention and eyeballs of your ideal customer in form a strategic partnership with them. Who is that going to be and why are they an ideal partner in the category of transaction size? Adding other people's products and services. This is one affiliate. What would one affiliate be? Who would make sense to be able to for you to bring in to offer their services to to your customers? Okay, so create an affiliate relationship with. Who are you gonna do that with? And again, why would they make a good affiliate? I want you to think about larger orders. Remember this is bulk bundle and multiple deals. What's one of those strategies that you could use? What is it and why is it good? Expanding your value chain. Is there one acquisition that you could make, either a competitor or a supplier or distributor that would allow you to capture more of the profit in the value chain that's going off to them right now? Again, maybe a supplier, maybe it's a distributor. And keep in mind, suppliers can be the content marketing agency that's creating content for you or the digital marketing agency that's doing your ads. Distributors could be the affiliates that are selling your stuff. Right. So who would that be and why? I would like for you to think of one monthly or annual recurring product or service that you could add, like create a membership. What would that be? Why would that be good for buying one monthly recurring or annual recurring revenue acquisition, and that might be acquire SaaS. Again, which one and why? And last but not least, borrowing one outsourced. That would be what's a third party subscription that your existing customers would like to have? That could be a publication type subscription, it could be a membership site subscription, it could be a SaaS. So what one thing in each of these categories could you do to expand your business using this tool? Okay, so it looks like this for me, I would fill out the top one. I would say, okay, I'm gonna do a new media channel and it's gonna be. I'm gonna advertise on the Business Lunch podcast. I'm gonna advertise our lead magnet from our workshop on how to create courses are done for you paid newsletter services. It's the perfect audience for us. I'm gonna have that done by 11:30, 21. For the transaction size, I'm going to choose larger orders with the bulk bundle multiple. I'm going to create a bundle bundle of our training coaching done for you and mastermind products. And I'm going to provide the ultimate package on everything that our customer needs to be successful and have that done by 1 4, 22. And for the last one, I'm going to pick borrowing through outsourced. I'm going to start approaching funnel builder providers about a strategic partnership to offer their SaaS as part of our packages. Maybe a white label. I'm not sure our customers buy this already anyway, so that's probably perfect. I'm have that done by 2722. So it's important to have tools like this to be able to identify things that you can do. And I'll tell you, I mean this is responsible for a tremendous amount of growth and revenue and profits. In every company that we have. We go through these exercises. It's just so helpful to do this kind of stuff. So that is the leverage sales part.

Ryan here. And look, if you're an entrepreneur, you're busy, right? Whether it's replying to emails or scheduling meetings, whatever, there is a lot of work and a lot of hats that we need to wear as entrepreneurs. And that's why as entrepreneurs, especially if you're a visionary founder, you need help, right? And I don't know about you, but at one point for me, I was getting so overwhelmed with all the little day to day tasks that were, let's face it, they gotta get done, but they don't necessarily need to get done by you. And so when I came to this realization, I said I gotta get help, I need to get a virtual assistant, I gotta get a social media manager. And that's when I called my friends at Belay Solutions. Belay Solutions are an incredible organization. Now look, I don't know about you, but I tried to work with VAs in the past, it was always a disaster. And so I was really, really suspicious of being able to make it work. But their process was fantastic. They found out the type of work that I need done, the type of people, people I like to work with. And they really did match me with a perfect virtual executive assistant. And this person's been with me now for three years and counting. So obviously it worked for me and I think it's going to work for you. So here's what you need to do. All right. The good folks at Belay, they're actually giving listeners to this podcast $300 off the startup cost for their virtual assistants. You'll pay less than I did. Here's what you need to do.

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All right. Text lunch L U n c h to 55123. Again, that's text LUNCH to 55123 to talk to Belay about getting a virtual assistant of your own. You need it.

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Now we also have six different categories with 63 profit accelerators or optimizers as part of our founders board tool set as well. So this goes around time based profit improvement. How can we be more efficient with our time or timing in how things are done in our business? What are the labor based opportunities that we've got with our workforce, our employees, our executive team, even ourselves? What are general profit improvements that we can make? That's kind of a catch all. What about supply and cost of goods sold? There's a whole category of those kinds of things. Capital expenditures. There's some tremendous opportunities there that people don't think about. And then cash flow management based as well. So I'm going to look at one of those. I'm go through two of the easiest, lowest hanging fruit things. The very first is just increase your prices. Increase your prices. Right. How many of you have run a pricing test in the last six months with price increases? It's just all profit. Right. Your cost doesn't go up to deliver that service you're running those tests on. So here's one we ran on four different products. It was a four way test. The original price, 150 bucks on one. The winning price was $179. That's a 19.3% price increase that we were able to effectuate on that product. That's just found money because if we hadn't tested it, we wouldn't know. Right. Many business opportunities exist when you're acquiring companies to have the company pay for its own acquisition out of a price increase. Because so many smaller businesses, particularly owner operated, haven't increased their prices in years. Like five years, seven years, nine years. It's crazy. So we can go in, we can acquire that, adjust the prices. You're going to lose some people. But ultimately you can price test. So the second product was $150. The winning price was $159, 6% price increase. The third product, $125, $129, 3.2% increase. And product four was $150. The winner was the control, $150. So nothing there. But on average, across that was a weighted average price increase of 9.13% across four products. We have 20,000 customers that will now pay $13.70 on average more for those products, which is $274,000 a year, which is a very, very nice dinner with Ryan or a nice, almost a case of wine. No, it's, I mean, it's meaningful though, right? It's a lot of money. Okay, so how to gently price test. If you're nervous about this, as many people are, just pick your top 25 customers. Or if you have millions and millions of customers, your top 25 segments, right? And ask yourself, if we raised prices with these people or this customer, 3%, 6%, 9, 12, 15, you can play with it. Would we lose them? Would we really, really lose them? Maybe they complain, but will we actually lose them? Nobody likes change. Only freaky people like change. Right? I like change, but everybody's going to have some resistance to it. But would you actually lose them? And you can test gently this way with 25 of your customers and then see what is the effect? What is the effect of it? Because very often you'll find that it is going to have no impact at all. Okay, and then raise the accounts that can take it. Raise the accounts that can take it. The other ones, you can say we've had a price increase, but we're going to give you a price freeze because you're a great customer that's been around for 14 years and we don't want to lose you. Well, then that makes them stick better because they realize that they'd be giving up something and they're getting value from you by you not implementing the price increase. So they're going to appreciate you more. The next thing would be to extend your value ladder. This is something that is one of the most common issues. When I do, I do 25k half day consults. This is one of the most common issues. And it's so simple to fix. It's just have a value ladder. You should have three things. You should have a firewall product, which is your low end market firewall that prevents competitors from coming in and taking your customers. Right. If you only have high ticket, which I hear people preach, if you only have high ticket, then you're not building up customers that you can market that to. As they evolve, you're not able to stay in touch with them. They're Not a customer yet because we know customers are significantly more likely to do business with you if they've already done business with you before. So you're missing out on that. Plus you're creating an entrance for competitors to come in and, and eat away at your low end profit base and then ascend them and ultimately consume your high end profit base. So you want to have a firewall thing to stop that from happening. You want to have what they call a top caps, the top thing on a ladder. The top cap is the high end product, right? Something that provides convenience, quality, exclusivity, et cetera. That is very, very valuable and is very, very expensive. And then you have the rungs in between those step products. But I can't tell you how many people are missing. Usually it's the high end product. They're selling tons and tons of low end stuff. And as we all look at acquisitions, this is a great place for you to see opportunity and acquisitions. When there's a lot of sales of a small low end, low profit product and no ascension path, no value ladder, no top cap, then that's a great opportunity to use that existing customer base to ascend to by implementing a value ladder and have that pay for the company that you acquire. Some examples, American Express, Green Gold, Platinum and Black Cards. Digital marketer, we have Lab certificates, Elite Certified Partner, all the way up to founders board and founders board. Plus we have Barbies, right? Barbie has Barbie Pink, there's as many of them as they can make. Then there's Silver Barbie, they only make 50,000 of those. Gold 25 and then platinum, they only make a thousand of them a year. So they've created continued interest in the doll. Delta Airlines, you got Basic Economy all the way up to private jet rentals. All of these successful companies have value ladders. They know that there's a percentage of their customers that they would love to serve that are fanatical about them. They'll make that customer happy. They'll be able to give them great value and it'll provide a really high profit margin item that is appealing to them. And that is is what I have for you today. I hope that was helpful.

Thank you.

You've been listening to Business Lunch with Roland Fraser. If you're enjoying the show, let us know by subscribing and leaving a review. And for more information go to businesslunchpodcast.com thank you for listening.

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