Dave: 0:02

Welcome to the Business Unscripted Podcast. We're here to share real life insights, practical strategies, and the honest lessons that we have learned from our own mistakes because frankly we have been in your shoes. So whether you need help with operations, accountability, financial knowledge, sales, or maybe just getting your mindset right, we are here and it is the right spot for no fluff conversations and tools of work. So grab your favorite cup of Joe. Let's jump into the show. Good morning, everybody. It is another Friday, January 30th. We're here with another live episode of the Business Unscripted Podcast. I hope you guys are having a wonderful, amazing week. If you live in any of the areas where it's got all this fun, crazy snow drops, well, I hope you were able to dig yourself out, able to stay warm and safe. So it's just me as a co host today. Dwarne had some other things going on. So you get me today. However, I am excited because today we are welcoming James Landot, who is the founder of JL Consulting Group. James works, James works hands-on with trade service-based business owners, helping them slow down the chaos, build real operational controls, and ultimately regain freedom over their time, money, and their future. And he doesn't, he's not just a consultant. He's built, owned, and operated different businesses in construction, landscaping, and the service industries for decades and decades. Don't want to make him sound too old because he's not. But so everything he teaches, he learned himself from the field, from his own experiences. And so, James, let's go ahead and bring James on to the stage. James, sir, welcome to the Business Unscripted Podcast. It's it's a pleasure to have you here, sir. How are you? Doing well and yourself? We are we are doing we are doing good, sir. Doing good. You know, pre-show, we were talking a little bit, so I know you you were in the area of fun snow experiences over this past week, huh? Oh my gosh.

James: 1:52

I've been doing snow removal for over 25 years, and this is one of the worst events. I'm glad I didn't have to get out there and play in it. But I'm not jealous of the people who did. It was snow, sleep, nice. And then if you didn't get it off in time, man, it's about three, four inches snow. My kids have been stuck boom all week.

Dave: 2:09

It's like really yeah. But one flying who does snow plowing, he was out for like almost 48 hours straight. So it's it was a it was one of those fun adventures. And and I hear that there's even a bigger storm coming to like the east coast. Luckily, like in Ohio, we're not gonna see a lot of it. But like there's like this whole weather pattern that's gonna hit like Florida and Georgia, North Carolina, South Carolina. I'm just like, wow. People people try to get down there to get away from the snow. And here it's gonna snow even more over this weekend. So uh if you're down there and you're watching, hopefully you're safe. But yeah, the iguanas are falling from the trees. Watch out. Yeah, yeah, yeah, yeah. It's raining in iguanas. So, James, let's go ahead. You know, obviously, you've been in business for you know, we were talking pre-show over 20 some years, right? Where you built many different businesses. So tell us a little bit about your kind of journey, where you started, and where you're at now, and then we'll kind of jump in a little bit into it. So that way everybody, all the viewers can kind of understand who you are, what you did, and uh, you know, where you've been.

James: 3:05

Yeah, so well, a lot of the people in the landscape industry can appreciate this one. I started cutting grass when I was 12, you know, kind of came out a little bit more of a necessity. Uh the joke kind of is well, it wasn't a joke. Uh, I wanted a pair of Nike shoes instead of Kenny's, because I don't know if members of any old timers remember Kenny's shoes or not. And my dad said, here's the lawnmower. Yeah. Max up the street wants his grass cut. So I started cutting grass, which was a good thing. And by the age of 14, I made over 450 bucks a week cash. Helped buy my first truck, helped do all those, you know, all those things. Didn't think I was gonna be a landscaper. Ended up uh selling my company at the age of 18 when I graduated high school and ended up in the Navy. Amazing part was you could always make, you know, when you work with your hands, you can always make a buck. And so unfortunately got medically discharged from military, kind of waffled around, you know, being a young, young man, not tied down.

Dave: 3:59

Right.

James: 3:59

Wandered the nation a little bit and just always came back to mowing some grass or doing some landscaping, planting a shrub. Got my really big start back in early 2000, 2001 was when I furly first opened up my first real company. It was I was able to grow that up to close to about two, two and a half million dollars when the bubble pop back in 2007, 2008, had an opp opportunity to merge, did a merger. That was kind of fun. Uh learned about contracts.

Dave: 4:31

Um due diligence, all that fun stuff you gotta do, yeah, when you're doing mergers for sure.

James: 4:37

Yeah, well, I didn't. I just went and just signed. If you just say, Where do I put my signature? Okay, got it. Yeah, yeah, yeah. I I was young, had had a young wife, you know, you know, two kids under the age of three, you know. Shit, I'm just trying to survive. But I thought it was a good opportunity. I had employees about six, uh, had about 16, 17 employees at the time, and we merged in. It was a $32 million a year company. They asked us to come and do the residential side, didn't work out, so left, so I had to restart, right? As the bubble was popping, you know, and our had popped. And I ran uh my own company. We got up to about $5.8 million in uh 2022, craziest part of my life. I was up 48 employees. We were, I basically, as crazy as sounds, I kind of had three companies going at the same time. Owned a franchise, had a design build landscape company, and also built swimming pools. Okay. And my wife finally came to me, you know, most business owners, you know, you learn whatever it was. I was on medication from because I was blacking out from time to time due to the stress, we were doing really well. Oh my god. I was never home. So it said it's time to uh kind of it's time to hang a hat. So uh made a decision, kind of be at home more. And because of my experiences, I I opened up uh JL consulting group about two years ago. So had some great success in the service industry, had some failures, as we said before. You know, own a couple t-shirts, some are bright and shiny, some are really well. Been there, been there, right? Been there done that.

Dave: 6:13

Yeah, I mean, so I would I would say like that's the biggest, that's the biggest, I think, hurrah, like for you, right? Or for anybody listening. If this is if you're going into like your first business or even your second business, like it's not guaranteed to work, but it's also doesn't mean that you're a failure. You know, James, I mean you went through nine, right? You're in you're in you're in your ninth business. I mean, you know, this is my fourth, right? My fourth business for for yourself, what would you say? What was the number when you kind of you you mentioned you had a two and a half million dollar business? What number business was that for you that really kind of took off and kind of made you successful that you're able to merge and kind of you know, I guess on that in that case, kind of get out of that business.

James: 6:55

That was business number four.

Dave: 6:57

Okay. And if you would have stopped at three, right, or you were stopped at like after the first one that just didn't give you the results that you thought, right? You would have never seen it, you would never be where you are today. And I think that's the biggest lesson that a lot of people can can hear from from your story, from my story, from anybody's story, that you know, if you look at anybody successful, they didn't stop after the first failure. You know, sometimes it wasn't so after fifth, sixth, seventh. I mean, fifth, yeah. Yeah, sometimes even the tenth. Like it's just the idea is that you learn from from the mistakes, the obstacles, the parts that made you fail, and then you move forward and you learn and you correct it in your next opportunity, your next, you know, your trial and error, I guess. And then once you make it, you'll make and then you learn. Then as you said, sometimes you're gonna make it and you're gonna either exit, or something outside of your control is gonna cause either you have to shift the direction of the business, or it's gonna cause the business to have to either shut down because that industry is now tanked, right? Or and then you have to learn and you can go start something new. As you said, as long as you're still here, right? You woke up this morning and you're able to breathe another day, you have another opportunity to do something, right? And landscaping, you know, it's your hands, you know, you have the ability to do a lawn or push some snow, whatever it is. You know, if you're in the corporate, you can use your mind as long as you can think, you have the ability today to make a change and make a step forward. So, what would you say? You know, obviously you said you had the a lot of the bright shirts, right? You're able to interact, they're sitting in your dresser. And what was might be one of the biggest mistakes that you learned as you were kind of building your businesses, and what did you do to kind of correct it?

James: 9:11

Well, I mean, one big mistake. I think the biggest thing is really understanding the financials. It was amazing. It took me years to really get a good handle on financials, but if I could tell anybody, and then this is actually what I first train on, is understanding your money, where it comes in and how it goes out. And once you get a good grasp of understanding that, good, clean, strong financials, a simple PNL. Keep it simple. Oh my god, I've made some things complex in my life. You keep it simple and you have a basic understanding, and you can find great success. It was kind of interesting. I just met with a uh business owner, did a financial analysis on their company. Didn't the that wasn't the prettiest, but the amazing part is he actually got some, he's been in business for over 32 years, and he's trying to expand now. And the problem is he's got something that's a little complex, but he had a really good lesson back in the 80s about understanding the true cost of doing business. And that was something I never learned was the true cost. You figured, oh, you got your labor and you got your materials, or you know, you got your direct costs, and then I'll make add a little bit more money on top of it. There's so much behind it, and I think that's what most people that try to start a business miss. There's a whole lot more than just doing what the job is.

Dave: 10:37

Well, and it's funny because you say that because the true cost of business, and if I had this, I think I've even mentioned it like uh the last few podcasts, and it's so important to just mention again. And so if you're an owner, you're a business owner, you cannot think top line revenue. Yeah, you cannot think, hey, I just signed this $10,000 job because it's not $10,000 to you. You have direct costs, you have cost of goods. You need to know your gross profit margin. And it's it's still surprising to me, which I guess I shouldn't be surprised anymore because it happens all the time, that there are bookkeepers and advisors and accountants that don't give that information to their clients, right? I I you know, I just we we just started with an a new another client's got four different businesses, and they don't know any of the the margins from any one of their four. They've just never been given the information. And and granted, a business owner doesn't know what they should be asking for, but if your expertise is to be doing their books to be their advisor in accounting and taxes, and you're not giving them their gross profit margin so that they can make better financial decisions, what are you doing? That's your job, you know, like that's part of your support service. But I feel like there's so many people that just want to skate by, they just want to do the bare minimum and you don't want to review a lot of that information with them because I feel like it's gonna require more out of them, you know, like they don't want them to start questioning them or something or anything like that. But you can't operate if you don't know your gross profit margin, especially as a business owner in landscaping and service business, in unless you're somebody that's like you're the only one, or like you know, there there's very low cost of providing a service, you need to know your gross profit margin.

James: 12:16

So, but here's so we had a conversation again backstage on this expectations. So, you know, I talked about this client who I just met with and would did a full financial analysis, and we we went through and looked at their book structures, we looked at their SOPs on how they're doing recording, and he was all mad at his accountant. And I'm like, why are you mad at your accountant? And he says, Well, because he should have told me how this was all breaking down and should have coded all this stuff out. And I'm like, that's not an accountant's job. And accountant, and I so I think sometimes in business ownership. Now, I know that you you play and work an awful lot on the financial side of businesses, and so here's the difficult part. Most of the time, particularly young business owners, don't know what they don't know. Okay, first off, they don't know the information that's out there. Sometimes they didn't even know what gross profit is. GP. I asked them, hey, how much money do you make? You know, what's your percentage? Oh, I make 40%. And if that percentage, that's after they finished the job. And I'm like, no, no, no, no, that's not your true profit. They just don't know. But an accountant does taxes, they're watching out for your liability. They're looking at your revenue and how much you spent. They're not going to sit there and show you what your different revenue numbers are. You get into bookkeepers and I'll talk to some bookkeepers. And they're like, Well, we don't set things up. We expect the owner to give us the expectations of how they want to see their numbers and understand their KPIs. Well, but this is that's where there's experts like you and myself who actually try to help. And a lot of business owners shy away from that. Hey, what do I need to know so that I know what to look for?

Dave: 13:49

Well, but this is why you know I have this conversation with a lot of people. You're right. There is a there is a fundamental difference between a bookkeeper and an accountant, right? An accountant is going to be somebody who's going to file your taxes, but there are also accountants that provide the bookkeeping service for their clients and they should know their stuff. And I see it constantly where it's like, oh, yeah, the same person does my bookkeeping and my tax filing. Well, then it and they're and they're not giving that information to their clients. And so you have to be that advisor. And it's funny because I had this question the other day from somebody, and they mentioned, you know, do you see this industry of accounting and accounting sort of going away with AI, right? As AI continues to develop, do you feel like it's going to go away? And ultimately, I said it's going to shift. And here's how it's going to shift. Because those mundane, day-to-day, you know, kind of tasks, you know, the end, the data entry side of accounting, that's going to be automated. There's already things out there, you know, our partner platform with KIC, a lot of that stuff can be automated and implemented. I think ultimately it's going to what we're talking about right now. You are going to have to transition to being more of the advisor, to being more of the, hey, this is what I'm seeing in your numbers. Here's how we can make it better. Here's how you make better financial decisions. That's going to be the shift in our industry, right? And ultimately, if you're not doing that, you're going to, you're going to be the one that's going to be out of business. There's going to be plenty of accountants, plenty of people that are going to continue to be successful because of the fact that they're making that shift. They're allowing the day-to-day things that used to take a long time to just, you know, enter and categorize and make sure they're correct. Now you have to be more of that, you know, pigeon eye and look at look at the information that the that is in the system that's being presented and correct it or advise on what that information says. Right. So the biggest thing gross profit margin is we're talking here. As a business owner, you have to, that's the number one first thing that you need to know is what is my gross profit margin. You need to know out of every time I make a sale, how much am I actually going to get to keep to pay for my overhead, to pay for the things that I have to pay for to stay in business. Because when you make a $10,000 sale, if your gross profit margin is 50%, you're only keeping $5,000 because $5,000 is already spent before you even keep, before you even walk in the door, that five half it half is already gone. Because you have to pay your employees, you have to pay your materials, anything like that. So you only have $5,000 to then pay for other marketing, other you know, overhead, over other rent, et cetera. And then out of that $5,000, you have taxes. Right? So you and this is why we've talked about the profit first system. When money comes in, you have to know where it's got to go. And and I have, you know, I've I've seen clients, I'm working with clients right now, who they're shifting money all around all the time because they're not doing that. Right? They they see 5,000, they don't realize that some of that is sales tax, it's got to you know be paid to the state. It's just a password, it's not your money, but they're using it as their money. And then when sales tax is due, now they're struggling to fill the sales tax bucket. And so you have to manage it more efficiently or have a partner that can help you manage it, and then get used to that transition and get used to that shift. That not every dollar that comes into your business is actually yours because it's not.

James: 17:05

Well, most as a business owner, and I think you know this as well as mine. Well, as the owners, we typically don't get to see much of that money at all. You know, I just take the example of a whole bunch of change, you know, a dollar's worth of change and throw it on the table. My employees all thought I'd made all this money. But here's one thing that I think a lot of people miss too is most business centers that I meet, and I did this for years, you fly by the seat of your pants, meaning, hey, look, I'm gonna go out here and let's say I'm gonna make a goal of $2 million in revenue this year. And we sit down and we do this big old quick budget. Okay, I'm gonna make sure I hit a GP of 55% and I'm gonna keep my overhead at only 28%. And if I are actually, so I average about, yeah, 28%, and then my variable overhead at 10. I should be able to walk away with 13% net profit. Oh my gosh, 13% on $2 million. That's $200, well, I think it's $60,000. Oh, I'm gonna be good this year. They do this thing, they set it up, and then they never watch it, they never monitor it. Because you can set up and have all the highest GP in the world. But let's say, for instance, that $10,000 job, okay, but you have to, and your overhead, let's say, for instance, is $50,000. Well, how many of those $10,000 jobs do you have to do to make sure your overhead's covered that month? So you can first off, knowing and understanding how your money is being broken down, you're looking at your GP, then you've got to be able to sit there and say, okay, hey, look, if I've got $50,000 worth of overhead every single month, we call it the thief in the night, you know, those kinds of things. When you know you're only working at a 50% GP, that means I better go sell 10, not just sell, but do our schedule, then produce and bring in that money. So it's it's that there's a full wrong.

Dave: 19:16

And and that's why it's so important to know that number. You know what I mean? Yes. And and if you get it wrong, which means you know you have expenses categorized incorrectly on your on your PL, you know, because maybe you're trying to do it yourself, or maybe your accountant isn't isn't looking you know at your numbers correctly. Like I just looked at financials again, where like some cost of goods were down in the overhead expenses, you're never gonna have that right information. And so this is why knowing it, and as an owner, you don't get just as you don't get to make the excuse, well, hey, I didn't know, because you're the one responsible for it at the end of the day. You know, and and and a lot of people when when things happen at these bigger companies, who do they want to blame? They blame the CEO. Well, he should have known. Well, that's you right now in your business. You have to know these things, and you can't just you know play dumb and just like, well, I didn't know. Like, that's why you're struggling. You know, I had the and you mentioned, you know, maybe in your situation, you know, maybe it's not $50,000 of overhead right now, if you're listening to this. Maybe you're trying to solve $5,000 of overhead, but you're trying to do it by finding jobs that are paying you gross profit margins of five to a thousand dollars. Well, how many jobs do you have to do that that are paying you $500 to $1,000 to cover your $5,000 over overhead? That's before you even get to pay yourself. So now if you want to pay yourself this month and you want to pay yourself, you know, $25,000 to $5,000. Now you have to double the work just to do that. So this is why you should be looking at bigger jobs that are going to pay you the same percentage margin, but in the end, you cover it quickly because you're looking at higher, bigger paying jobs. And it's an everyday struggle. And but here's the thing it's easy to solve once you get the numbers and you know what you're working for. Once you have the information, right? You're an owner, you can take that information and run with it. You have it now, you've done it. You're you've proven your point that you can, you know, James, in your situation, landscaping. You've proven that you can do landscaping and hardscapes and all in all of these different situations. And once you mentioned the financials were never your strong suit, once you've got that information in your head, how did that change your business? Like how did you were how did you take that information then and how did it impact how you began to price your jobs, how you began to look at new client acquisition? How did all that shift once you got that fundamental understanding of your finances and your business?

James: 21:32

Well, it made me more confident and stronger in exactly what I was doing, and knew that I was gonna have, you know, once you start to obtain goals, you now you're providing yourself a good direction. You know, you've heard the old saying, and you know, knowledge is power. It is power because once you know and understand it and you've got a direction that you actually have to go, you're able to drive straight there. I think sometimes as a business owner, you know, we come in here with a great passion. We come in here with a great, hey, we've got this service that we're gonna be able to go out there and we're gonna just be able to wow our clients. There's there's no way that people aren't gonna be able to buy or want to buy from us. We get in there and we get, you know, we get hit upside the head a couple too many times. We get a big barrier that gets put in front of us, and we start to lose our direction. You know, a lot of times we're sitting here, okay, how do where do I go? Well, how do I take this? Well, when you have a good, strong financial understanding of what you need to do or where you need to go, and you have a good direction in exactly where you're going. And good financials and an understanding of those financials provide that. You know, I was meeting with a client the other day, and they're in a particular area. They've been selling a lot in this particular county. And the county, I'm look, I'm just gonna say it because it's just absolute truth. The unfortunate part is that this particular area where they're selling at is they have a kind of higher expectations, but they're only willing to pay so much. They they like all their own buyers.

Dave: 23:04

Okay, yeah, yeah, yeah. For sure.

James: 23:05

Yeah, and so this particular client wants to go out there, and we we actually talked about good, better, best. Well, hey, look, I know you want to perform best, but here, these clients tell him this particular neighborhood is only going to pay for good. And that's what it is. And knowing and understanding, because he was going out there and kept kept trying to sell best, and they want discounts, they want this, they want that, what was lowering their GP. And I said, No, no, no, no. I said, I want you to try something. I want you to go out and I want you to sell good to them, understanding your expectations, understanding what they're willing to pay for something. He went out, did good. Was he as excited about it? Oh, because it didn't look as good as he liked the best of what he wanted on all the projects. No, he didn't get to get as big a trees in there as he wanted, and he didn't get to use the traverkee. He had to use a concrete paver. But you know what the funny part was? He turned around, sold it as a good, sold the project, and still hit a 55% GP, which means he hit the money that he needed to hit. He didn't reduce the dollars, he reduced the scope and still hit the 55% GP. Now, based on that discussion, he wants to be in best, which takes time to get to that clientele. I said, Well, you know something? Stop advertising over there and start advertising over here. Right. Yeah, you got to be in front of the right people, right?

Dave: 24:28

If you what's that? I said, You you definitely have to be in front of the right people. If you keep marketing to the to the people that just want good, you're only going to get good clients. If you want people that you know best, then you you have to start you know putting yourself in the magazines, in in the mediums, whatever where where those people are paying their attention to. And and I think you mentioned money. Exactly. This is this is an important thing to pick up on, even if you're not in landscaping and you're not in you know a service-based business with good, better, best. And essentially a lot of people are going to ask you, hey, can you do a little bit different? Right? Can you can you discount? Or and here's the thing if they want a lower price, you have to be willing to adjust your scope. You have to take something away because it is not fair to you. And I tell people this all the time, you have to value yourself and your time, right? So if they want to pay a little less, hey, I can do a little bit less, right, for you. However, we're gonna have to take away X, Y, and Z, right, to meet that budget. We can't give you this same level of service at the at this discounted price. Because one, it's not fair to all your other clients who are paying the full price for that service when you're gonna give it to this other new client who for a lot less. So, and you have to be willing to adjust your tie on it. Because that's you pointed it out again gross profit margin. You have to be willing to hit that GP in order to be successful in business. It's no longer about top line. You have to understand your pricing, your offers, and what at the end of the day is bringing into your business to pay for overhead, to pay for you, to pay for everything else. Because if you don't know that one number, you're probably I guarantee if if I ask somebody, there's there's two numbers, two questions you could probably correlate to, right? J and J Price one, do you know your gross profit margin? And they say no. Okay, and are you where you want to be in your business? And they're gonna say no. And it's a once they say no to the first one, they're probably gonna say no to the second one, you know, or they're struggling or they're they're frustrated.

James: 26:23

But I do five million dollars in business. Oh, that's nice.

Dave: 26:27

You know, and it it's it's five million dollars and you're losing money. Why is that? It's because you're pricing things wrong and and all of that. So it but which when you're that size, small shifts can go a long way, you know. A two doesn't matter what size you are, right?

James: 26:44

That that's so this was a huge mind shift for me. Huge, and this happened uh probably right before the bubble popped. I was about six, seven years in business. It was you know, all business, small business vendors. Man, I'm I'm gonna go out there and you know, I'm gonna go hit a million, I'm gonna hit two million, I'm gonna, I'm gonna go do yes, like you said, that top line. I actually tell my clients right now, I I started working with a new guy last uh it was February of what year were we in? We're 26, 2025. I got his eye, you get to a certain age and it's just like it all melds together. And he's like, you know something? He pounded his chest out, and he's like, Well, I did a million nine last year and I want to do 2.8 million. And I looked at his numbers and I was looking at some other things, and I said, Yeah, no, not gonna happen. Why are we so worried about pushing that top line? Why don't we turn around and see how much money we can actually put in your pocket? And he was at a negative 3%.

Dave: 27:41

Exactly. And that's that's the biggest piece. Like, stop, you have to like where's your wallet, right? Where's your time? Where's your your effort as an owner? Like, you have to make sure you're taken care of first, and that's why you know you mentioned like earlier on in the episode, as owners, you know, we just have the expectation that we're just supposed to be take whatever's left. That's not the case. Like, you have to set your business up so that you can take first, right? You set and this is profit first, mindset, yeah. Right, it's a mindset. You have to change, you know, accounting, all this, you know, all the gap and all this stuff that people talk about, right? You it's profit or sorry, revenue minus your expenses equals your profit. Same thing on taxes, right? And that's where it's important when it comes to recording the activities, but you can set your business up so that you're thinking revenue minus what I want to make is what I'm willing to spend on my business and operate. Like you don't have to overspend on your business just because you're making the money, and that's exactly what happens when people who are doing a million, two million, ten million dollars of business happens. They're struggling for money because they're allowing their business spending to expand because all that money's in their bank. And they're like, Well, I can spend something, I have the money, I'm comfortable. And then when it comes the time to either pay the tax man or pay themselves a bonus or their salary, they're like, Well, where's all the money? Well, because one, you probably haven't looked at your financials to understand it. And then two, you haven't you haven't given yourself and you haven't created the habit of giving your money a purpose when it comes into your business. And that is ultimately what having cash management is in your business is giving your money a purpose, not just saying, Oh, it comes in, I'm gonna spend it however I can or however I need to, and then not think of yourself first. You it's a big mindset shift. You said it's a big mindset shift to think of yourself that you can pay yourself first, right? Because you're like you in landscaping, or you're an employee of the company, anyways.

James: 29:36

I mean, are you out there doing work? You pay some foreman or some high position $37 an hour. You know, the funny thing was actually my business is affording my wife to be in a stay at home and for 15 years and take care of our kids because one daycare. I'm right outside of Washington, DC. Let me tell you, the cost of living out here is insane. And one of the biggest things, and I it blows my mind, and you talk profit first, you and I kind of same thought ideas, but different lingos. I actually put myself on the payroll every week.

Dave: 30:09

Yeah, because depending on your setup, if you're an S-corp, you have to pay yourself a salary. And this is for a lot of people, a reasonable salary. And it's funny because I because I had a conversation with the new client I just signed up, they think they're an S-corp. And I'm like, Well, how much you know have you paid yourself recently? And they're like, nope. And I'm like, What do you mean? I'm like, your accountant hasn't told you that you have to pay yourself a reasonable salary, and he's like, Nope. And I'm like, that's a problem. Because you have to be a if you're an S-corp, you have to pay yourself a reasonable salary. They don't give you what that actually is, which you know, it's the gray area when it comes to S Corp status and taxpiling and everything, but you do have to pay yourself.

James: 30:43

But sorry, chance go ahead and told employees, you know, all that fun. But but here's here's the mindset though that I want to throw out there for people, and this is what blows my mind, okay? You fight every Friday or every two weeks, whatever it is, to get payroll to pay your employees. Yet we never fight as owners to make sure we're paid. So I actually put myself on the payroll because it had to be a mind shift. Now I was 23, 24 at the time, you know, I was on company number four, you know, and stuff like that. And I was like, why the hell do I never have any money? And I said, you know, I'm fighting here all the time to pay my employees, but I'm the biggest employee within the company. Why aren't I paying myself? So I literally put myself on the payroll. So, say for instance, your payroll is $3,000 a week, I want to pay myself $1,000 a week. Well, guess what? My payroll is now $4,000 a week. And I fight to make sure payrolls covered, including myself. And for a lot of small business owners, and I I've got two young guys, they're 22, and I'm talking to them and they want to move out of their house. I mean, shit, I don't know about you, but my at age 18, my mom was like, if you're not in college, get the hell out. You know, there was no option. You didn't live at home anymore. And I was like, Well, guys, are you paying yourself? And they're like, No, will you paying your employees every week? Yes. Guess what? Starting this week, we're gonna put you on payroll every single week. And it was all of a sudden amazing the mindset of like, I'm not just fighting for my employees' pay, but I'm also fighting for my pay too. Yes.

Dave: 32:18

Right.

James: 32:19

And I think that's something that people forget, particularly business owners, because we we sacrifice ourselves for the sake of our business. We didn't get into business to sacrifice ourselves. We got into business, one, because we're passionate about what we do, but second is so that we can also take care of ourselves. And that's a huge mind shift. And that's why what I like about what you do with the profit first, because it's that mind shift change. And most business owners don't get into that.

Dave: 32:51

Yeah, for for and you think of yourself as like, oh, I got to take care of everybody else. I got, you know, I got employees I need to take care of. You come, you become last. And ultimately, it's you can become first, you still can become first. And so it is a big shift. And and with that, I you know, why don't take a pause real quick and talk about program, you know, we talk about softwares we use on a regular basis for you as owners to kind of you know, kind of help and make an impact. So if you are doing a lot of, I would say, video editing, you know. So I I think I talked about it last week in terms of Canva and everything, but a big one that I use that I that I like to use is it's called Wizard and Wizard.ai. And the idea here is if you're doing a lot of long form like we do with these episodes, you can drop in the link or you can drop in the actual video, and it's gonna help you cut your videos down into bite-sized clips. You can give it, you can set up templates, you can set up different sort of timings, as well as you can give it a topic and say, Hey, I want you to go search for this topic. I know we talked about this, like, you know, around me and James here, we may drop in like gross profit. It's gonna go and find all these digital tidbits about gross profit, and it's gonna edit those clips for you. You can then set up your own templates, export them, drop them into any of your other sort of editing software, or just go and post them yourself right from the platform. It can do B-rolls, it can do all this fun stuff. So Vizard is something every week that I do in my business to help cut these longer form contents down to shorter clips so that they can be put out on my different social medias. So if you are doing that in your business and you need to be doing video, video is a number one sort of you know, kind of necessity for you on social media. Create video content, it improves your expertise, you know, it shows the value of the work that you do if you're especially if you're in a service industry, like you know, James and I work with and you're doing landscaping. The before and afters are fun things, you know, ones that are gonna capture people's attention. You know, those time lapses of you know, you doing your clean out or you doing a lawn transformation in the backyard that's you know overgrown, and you come in and you tear it down or you do a time lapse of those, those are gonna be huge in order to gather people's attention. And if you're doing those and you need something to edit some longer form into short form, Bizard is a way to go. So, with that one, check it out. It's nothing too in-depth today, but I just wanted to share that with you. It's something I use on a regular basis, just like we said, we want to kind of give you guys some insights on that. So, James, back to it, man. What now you kind of shifted your role, right, into the more of the consulting. So, what is something besides gross profit? I think people are kind of gross profited out now. We could probably do an entire episode on on why it's important for that. But what's what's another area that you are currently seeing and and and walking your clients through to support them right now in your business?

James: 36:15

I well, I know something that's a challenge for me and always was in business, but something I train a lot on is knowledge transfer. It's a big word. It took me a while to learn and understand what that meant. I was doing it or trying to do it, but didn't understand what it was. And I think a lot of times business owners, you know, particularly in the trades or whatever you're in, passionate, you know, you even said corporate, is being able to teach others information that you have so that they can be successful in doing what you want them to do, or being successful in their jobs. Also, with that knowledge transfer is setting expectations. I mean, I I think that's huge. And, you know, trying to take my 30 years plus of experience that I have and trying to teach that to other business owners and consulting has been a huge challenge because I mean, just think about the way we communicate these days. You know, it's there's so many different ways we communicate, written, verbal, body language, you know, all those different things. And particularly these days with being video, it's it's efficient, but there's so much we miss out on some of those things too. But yeah, knowledge transfer is a big thing I'm really training on, and I'm learning an awful lot on myself.

Dave: 37:30

So, so just for anybody watching and you're listening, knowledge transfer that you're kind of referencing here is maybe you're maybe you're in a business and you're thinking of hiring a your first employee, or maybe you have three or four employees, but you're still finding that you're the bottleneck. You know, the knowledge transfer is to get those processes out of your head and onto paper or into some sort of checklist or anything like that so that they don't have to come to you directly anymore. You have it written down and they have training. So this is the knowledge transfer that you're referring to, right? Not just necessarily like, hey, I just want to get, you know, I'm exiting the business and I'm trying to knowledge transfer to the new owner. You're basically how do you work with your employees to understand exactly the process that you need them to go through in order to provide the output that you expect.

James: 38:24

And that's huge. And how to take that so and it's not just when you start to do knowledge transfer. So some of the things I really train on are what's called repeatable and scalable. And repeatable being the main word. You mentioned earlier the bottleneck. Most businesses stop growing because there's just no more time for the owner to provide to allow the business to grow. You know, every decision has a tendency to go through them. Every, you know, hey, how do you do this? Goes through them. You know, and just about all the different processes. So being able to set up, like you started to say, training. So writing out an SOP. And for those people's a standard operating procedure. A lot of small business owners actually have never been in the corporate world, so they don't know some of these words. I had to learn what an SOP was, kind of funny. Um but a standard operating procedure is huge, it's important. Okay, so every time, and we were talking about bookkeeping earlier. Let's take, for instance, being able to code a gas receipt. You know, we got down to you want to keep it simple. Okay, you put a hashtag. What is this for? This is gas. Well, is it for you know going out and doing a job? Well, yes. Okay, so we were right on there. What bank account? Did you use a credit card? And you write down simple information so that knowledge is transferred from one person, person in the field, to the to your bookkeeper so that something gets coded properly. Well, you figure your employee who's out getting gas should know and understand this. Well, maybe not, or your bookkeeper should understand it's a gas receipt. Well, but where did it come from? So then being able to sit down and actually say, hey, when you go to the gas station, you're using credit card 3514, putting it inside there, taking it out, getting your receipt, and writing down gas for a truck number two, and it was on 3514, and it gets turned in. That's an SOP so that it gets coded properly, either in your cogs or in your overhead. It's if that sounds really simplistic and crazy as an example, but every process within an organization has to be, and there has to be a transfer of that knowledge that goes on, not just of the SOP, but of the information flow through the company.

Dave: 40:51

Well, and and ultimately, I think what it what definitely comes down to, too. You kind of mentioned like these checking of receipts and and and writing down and then sending it in. I think it does become, you know, if you're still doing that, you're you're definitely antiquated. There's a lot of better options out there too. Maybe I have. Yeah, automate a lot of this stuff, right? And so, you know, for example, the the the platform that we're partnered with is called Kick. You know, and what you could do in this situation is you are able to text in specific receipts. And you could put in the you know the text message or whatever what that receipt is for, and it gets saved into the system and then automatically matched to that transaction based on the date and the amount and the vendor. And so this helps save so much time. Like with QuickBooks, you can text receipts or you can you know take it take a picture, but you have to know exactly how you're gonna record that transaction right then and there. You can't just automatically just send a PDF and then it's gonna automatically match on the back end. So it's a time saver for a lot of you know situations there. The other area of that that you mentioned is I think for owners, they don't know where to start because there are so many different processes that they are going through in their head that they don't know which one should be first and which one you know should be the main focus. So, how do you help your owners kind of put that into perspective and prioritize what needs to come out of their head first? How do you work with them to do that?

James: 42:22

So I I've actually got a pretty simple process that I work through, but we typically start with financials. If you don't have good strong financial awareness and understanding the SOPs that first come with all your financials, because everything else gets built on top of that, then we go ahead and then we train typically on what I've got a document that I actually work with at a. I think a lot of times in business, we and particularly since COVID, because we all had become separate, we've lost the art of relationship and customer experience. A lot of times your clients aren't buying from you just your product or just your service. They're they're they're actually, and I mean, you can read a hundred books on this, they're actually buying an experience from you. Whatever that product or that service is going to do to get a positive result. So, what I actually train a lot of my clients on, because I do everything operational-wise, from lead acquisition all the way through final closeout or collecting your final check. We actually work through how that client is experienced or experiences through your organization. So we typically start with lead generation and we start with the SOPs and what how the whole sales process. Because again, where does your revenue first come? After you figure out your financials, you got to have good strong bidding, which is based on your financials. So we we actually trace how and walk through that customer experience to the organization. And that's actually how we work through our entire SOPs.

Dave: 44:43

Sorry, it's muted. Where do you find the biggest hiccup is that you help them kind of overcome? Is it is it just getting it on paper? Is it you know actually documenting and thinking through every step? Where you know, if for an owner that's you know, maybe watching this right now, that's thinking, hey, I need to hire somebody, how can they get ahead? Right? How can they kind of jump ahead of maybe struggling with it after they hire their new employee? What should they be focused on now before they even bring that person on in order to you know kind of make sure that it's a success?

James: 45:14

That's a difficult question. Um it's well, I'm gonna come back to somewhere you're talking about with some of the software and things of that nature. I actually use different AIs these days because well, the interesting part is I've got over about 25 years of electronic documentation. Can't kind of give you an idea. I started working and running my own business before there actually was computers and computer software and internet. So I'm still back from the day of triplicate forms. I'm back from the day, God, I remember AOL chat rooms, okay? I I'm not that old, but I'm old enough. I've got a kid in college, so so I've had to learn and I've had to transition and do things. I remember going back when we used to write, you know, almost handwrite freaking SOPs. The difficult part is there's you try to push an owner through a certain process. And so typically when I am working with my clients, we start very high level. You'll hear about, you know, the different levels of uh management, you know, 60,000 foot view of a CEO, 40,000 is your middle manager, and then 10,000 and below is typically your field or people who are actually client-facing. And owner's like, well, I'm only in the 10,000. No, you're playing in all the areas. What I have, it's a little bit of a challenge, but once we start learning and understanding to go to the 40, 60,000 foot view, start working on your big overseeing things, your big, your big oversight. Don't try to get too specific. Run, as I just said, that lead acquisition or that first experience with the client. Start there, but very high end. What is the first thing? And start drawing out a very broad or very simple outline as it goes. Then what you start doing is you start seeing where's the biggest fire? What is the biggest struggle you have? And if it's in your on the tail end of actually producing or you know, on your final closeout, and that's where you're seeing the biggest struggles, start then digging down there. What I typically do is I do what's called called a rotation through. So we'll start at the lead acquisition. After we've kind of really gotten a decent handle on the financials, we'll start at that first experience and we'll do the high view, run through it, then we'll come back and say, okay, how did we do? Let's let's practice this a couple times. Then we'll go ahead and do a second run through and start to get a little bit more detailed. I think what happens is a lot of people, and this is because business owners, unless you've worked in the corporate world or you're a little bit more white-collar, and most of our businesses in this country are blue-collar or more service-based industry or mom and pop shops, we get so stuck in the details. What you have to do is you got to force yourself out of the details and back to the top. Does that make sense?

Dave: 48:17

Yeah, absolutely. I mean, uh, ultimately, I think, you know, if you start from I would say start with the job that you know that you need to outsource first and document everything related to that, right? Start from the the entry level first, sort of your responsibility of that individual, and then build on from there. Like what are you, you know, the basic kind of things, you know. So I don't know, I think ultimately one process at a time, you know. It's so many people want to do it all. They wanted to say, all right, I have to get everything out or else, you know, and and then you overwhelm themselves. And again, this is where the mindset comes in. They overwhelm themselves because they know that there's you know 75 different things that they want essentially outsourced. Well, you can't document all 75 today, you know, simply document the first one. What's taking up the biggest amount of your time that can be outsourced for the least amount of money and gives you back those hours of month? Start there, you know, and and you can use AI, you can use any sort of you know system that you want, and just talk to it and say, here's here's what I'm doing right now in this process. Help me document it into a memo for a either a VA or an employee they're gonna bring in. Boom. Now it's done. So take and schedule it into your time, right? You know, maybe it's at 30 minutes every day, you're gonna you're gonna speak one process and have it turned into a you know memo or a training document or a process and a procedure. One day, you know, 30 minutes a day, you know, that gives you you know six to seven opportunities a week. And by the time you know it, in in a month, you have all of them. You know, you have 30 to 40 of them done, depending on you know, if you give yourself some extra time. So it's all about not thinking that you have to do everything at once, it's one step at a time in anything in life. You can't, you know, we may think that you're the best multitasker for a while. I'm like, I mean, I'm a best multitasker, I do tons of things.

James: 50:12

Yeah, ultimately, I can't, you know, because do nothing right, or you don't never get everything fully finished, and it takes you a lot longer.

Dave: 50:20

Like I can get something a lot quicker, yeah, if I just paid attention to it and moved on.

James: 50:24

But I, you know, for a lot of time. First thing to that is my dad used to say, you know how to eat an elephant, right? Yeah, and it's basically one bite at a time. And what sometimes we try to stuff that whole elephant into our mouth, but you mentioned technology earlier, chat GPT. Okay, again, I I I'm an older guy, I'm trying to figure out how to back into stuff. I started if you can't see the filing cabinet. Actually, I when I sold off my business here a couple years ago, you should have seen the folders upon folders and boxes of paperwork. I used to just write lots and lots and lots of notes, okay? But I got in here recently, it absolutely blows my mind. Chat GPT, you can actually do voice to text. And we talk faster than we can tell you. There's also there's so many apps out there now, not just chat. I I use chat, chat and I fight, but we're doing Excel spreadsheets right now. But it's it's amazing. You can actually do voice to text, or you know how much stuff is on the web, and you go out there and you find can you please give me a standardized SOP for receipt writing? I'm sorry, and the the receipt I gave to you earlier was just a simplistic thing. And it'll give you us a and say, give it to me in a Word document that I can download, go in there, take it, and modify it based on what you have. There is so much stuff that's out there that are business owners' resources on our fingertips based on the internet, or even talk to somebody else. I mean, how many small business owners out there have colleagues or peers that are in the industry?

Dave: 51:57

You mentioned right, you mentioned that you you started business before, right? There was computers, there's any of these. You didn't you gotta be jealous of somebody who's looking to start a business today and how much information is just at your fingertips. All you gotta do is search it. Like we are at such an advantage now. Like we were, we everybody keeps thinking we're at a disadvantage. You are such a you have so many advantages given to you right now because of the amount of information that you have at your fingertips to provide you with the support that you, back when you started all your businesses, James, would have had to pay for to have all access to all this information. You can have somebody write your social media content, write your processes, all this stuff now with the use of Gemini or ChatGPT or any of the ones that you like to use in a matter of minutes and you know, in in a process of a day, you could have a lot of your stuff done. Whereas you in before would have had to have you know bring somebody in, pay somebody maybe a couple hundred dollars or thousands of dollars to write your SOPs for you, and then you still would have taken more time out of your day because you would have had to talk to them and tell them what they needed to write. And there was no standard. So use the the things and the tools that are that are there that are at your fingertips, you know, learn a little bit about them. You don't have to be an expert in them, but learn how they can support you in your day-to-day activities. So I don't know, you know, James, you you must know Nick here. So Nick wants to know how awesome is uh is Grassmasters, give the people what they want. So so what fill us in what is Grassmasters and and how awesome are they?

James: 53:27

So oh so this is one of my clients out in New Jersey. Is that Joker or what? Yeah well a little bit, but I told you I shared the link and uh maybe I shouldn't have, who knows young, uh uh awesome business owners, grassmasters, in all honesty. Uh working, I've been working with them for about a year now. This guy Nick, amazing guy, and actually the people that work for me, he when you're a business owner, sometimes one of the hardest parts is finding the right people and to work within your organization. That is so difficult, so difficult. And this guy, Nick, he's fortunately enough, has gotten some really good people. And I'm gonna do a shout-out. Actually, I've got to do a shout-out to Kirk. I promised him he's his production manager. This guy, about the same age as I am. Uh, it's uh the cool part about this owner, he's actually asked me. I work as a fractional COO too. And so I come in and I actually walk, I walk shoulder to shoulder with my clients. Now, I don't do their admin work for them, but we actually, because a lot of these things, a lot of business owners never gone to college, you know, that they've just been out there doing their thing, is I I help teach them. I my my job as a consultant is actually to work myself out of a job because I want to train. And this is the knowledge transfer uh telling you earlier. You know, I've got 30 plus years of knowledge that's stuck up in this head, and how do you take it over? So part of that is walking somebody through and helping them experience this. But this past year, we were talking earlier about our gross margin. But this particular company, we budgeted out, hit 50. We our goal was 54% GP, our bidding. Um, Nick, yes, you guys are awesome, but sometimes you're difficult on your bidding because you want a discount. We talked about earlier about uh making sure we stop discounting, Nick.

Dave: 55:24

It's literally money out of your pocket, brother. Stop discounting.

James: 55:28

We we we we we started to learn reducing scope. We also learned how to do production-based bidding, which is really good and some software. But they actually, I start with companies with industry standards. You know, we are almost every single industry, doesn't matter. Business is business is business. I specialize in the service trades, okay? You get into retail, you get into lawyers, you talk consulting. There are national standards, there's regional standards and things like that. So I start all my companies at a state at standards. Well, Grassmasters, and I've got to give a shout out to Kirk here, that he he actually blew the GP out. And most of the time, a three-man crew out there doing project work, hardscape work, on average, a three-man crew can only do about $3,500 to $4,500 a day. They were knocking out consistently $6,500 to $7,500 worth of revenue a day. Consistently. This company has blown numbers out that I've never seen. They had on their production side were just knocking it out, and they were hitting GPs of 58 to 62 percent. Produced, realized, not fake me out miscoding on the books because I'm hard on people's books. That that's a shout out to Grassmasters, and they do great work too. Good customer service, their customers really like it. They got it right.

Dave: 56:52

All right, there's there's Ada, Ada, they they must know Grassmasters as well, brother. Love it. Love it. That's a bookkeeper. Great lady. Okay, well, there you go. Hey, bookkeeping is always a fun one. And when you get a good one, it's good. But hopefully, I don't know if you if you caught the beginning, Ada. Hopefully, you got all those proper margins and everything in there that we were mentioning, and uh, you're giving that to them. So she knows what it is, and she she knows she owns those books. She owns these books. Love it. All right, so before James's uh clients and and their and their their their teams uh take over our show, we typically like to keep it about an hour. So, no, I think we had a great conversation, James. I actually think there's a lot more that we maybe wanted to cover as well. So we'll have you back on because I think it was a great conversation. And but I'd like to wrap up the show with like one thing that you hope that they the listeners can take away from today's episode. So, what's one thing that if somebody's watching have made it this far, maybe they're watching a replay, that you hope that they take away from our conversation today and can then implement in their business nearly immediately? What's that one thing for you?

James: 58:04

In all honesty, get to know your numbers. Yeah, take the time, no matter what you do, know your numbers. Most businesses fail not over 90% because of bad numbers.

Dave: 58:18

Yeah, it's it's it's like 82% because of cash flow and everything. And and and obviously, if you have bad numbers, it's gonna play into that. So it's I'm sure you all on the podcast, you're listening, you probably are sick of me talking about numbers, right? But it's good to hear somebody else kind of say everything that I've already been saying. And so here you go, financial visibility will change your life. You're right, Nick. You know, once you understand and how you price how your margins are, you know, it's gonna change the way your business, gonna change your trajectory of your business as well. So I would say I'd say for me, you know, I'm gonna second what you said, right? But ultimately, something a little bit different is don't stop at the first after the first failure, the first obstacle in your business. It doesn't, it doesn't mean anything about who you are. Nick, if you can comment real quick before we jump off, what number business is grassmasters for you? But ultimately keep pushing forward, learn from right what mistakes you made in the current endeavor or the past endeavors, and then correct them and move forward. Because ultimately, it doesn't say anything about you as a character. The only thing that will talk to your character if you fail in a business endeavor is if you stop trying next. That's what it'll talk about your character. You know, you're a quitter at that point. And you know, I don't want to be mean to anybody, but but it's true, right? You're you're a quitter. And ultimately, if that's your goal, if you want to own your own business, you want to be successful, you have to keep pushing forward. You have to learn. You know, you just because you have to go back and maybe get a job for a little while, right? Be in corporate world for a little while, doesn't mean anything. That doesn't mean that you're never gonna go back and do it, but give yourself that opportunity to go back and do it. Learn from the first time, learn from even your experiences in the corporate world to implement those into your business, and you'll actually see, you know, may take you know five, four, five, nine times, right? And and you've been successful before this, so I don't want to say it took you to your ninth business to be successful, but ultimately, you know, you can do multiple different businesses and be successful in all of them, or be successful in maybe one or two. And ultimately, it only takes one or two to set you, your family, and everybody else around you up for the rest of your life and possibly even their life. So that's what I want people to take away from. Don't stop after just one obstacle, one failure. So, with that, James, thank you for joining me, brother. I I'm gonna have you on it. We're gonna we'll have you on again. So if you have questions, feel free to drop them down below. We will answer those either you know live or we'll answer them um in a future episode. And yep, here we go. Grassmasters was my fifth, right? For Nick. So each one taught me something different, none of failure, always a learning experience. Love it, Nick. Thank you, man. Appreciate it. And good luck with Grassmasters and all that fun stuff. So, with that, please, we are on a mission with Triumph Business Solutions to impact 1,000 business owners by the end of 2028. So, if you want to help us out with that, share this. If something that you got out of today's episode impacted you, give us a quick share, give us a subscribe and a follow. And with that, James, I appreciate it, sir. I hope you have a wonderful day. I look forward to our next conversation. Um, Ida Nick, thanks for commenting. Thanks for watching. Hope you guys have a wonderful and amazing rest of your day. And uh, if you're on the East Coast, stay warm and uh stay inside because it's gonna be it's gonna be snowy to you this weekend. But thanks, James, appreciate it, sir.