0:09

From the headquarters of Ramsey Solutions,

0:11

this is just the Ontario Leadership,

0:13

but guess where? Articles from leaders

0:16

like you about what it takes

0:18

to win at any stage of

0:20

business and leadership. I'm Dave Ramsey,

0:22

your host with over thirty years

0:24

of leading just like you in

0:26

the trenches. What We

0:28

Do: If you're going to question you want

0:30

to ask going to show, fill out the

0:32

form at Entre leadership.com/ask or give us a

0:34

call at Eight Four Four Nine for for

0:36

ten seventy Leave a voice my own and

0:38

will shut you. Up to be a collar. On.

0:41

The Show: Zach is going to

0:44

start off today with Columbus, Ohio

0:46

Ironic Our you. Hi.

0:48

Dave I'm well and I had to say how do

0:50

I did I am to speak with you man

0:52

I'm a long time listener. I

0:54

feel like I've learned a ton from you

0:57

and novel Ramsey Network. Thank you. How.

0:59

Can we aren't yet? So I'm thirty

1:01

four years old? Mean I do food

1:03

trucks, ah, but usually have somewhere between

1:05

five and fifteen employees depending on the

1:08

time of year. our top on revenue

1:10

at about eight fifty. So

1:13

for the last several years I feel

1:15

like I've been kind of straddling between

1:17

the treadmill operator the Pathfinder, but I'm

1:19

I'm calling it a point in the

1:22

business where it's grown and a a

1:24

definite need some help on the operational

1:26

side and need leaders any thoroughbreds. My

1:29

stable. Job some a

1:31

big fan of promoting from. With then I've

1:33

got a great team but you know their

1:35

entry level draft. Good service jobs and I

1:37

know that. No objective way,

1:39

there's no one on my team currently you

1:42

as the skillset necessary to do the job

1:44

that I need done. So

1:47

enter my, my girlfriend, my better half

1:49

and nine years and we recently made

1:51

the decision to bring her into. The.

1:54

Company and what is effectively as a

1:56

Ceo will. Actually, day was actually

1:58

her last day of her full-time job

2:00

where she worked as an events

2:02

director for a trade association that

2:05

represents my industry and when we first

2:08

met she actually operated her own food

2:10

truck business for a couple years so

2:12

you know by all accounts

2:14

she's qualified. We've been

2:16

together for most of the time that I've

2:18

been in business and she's well known and

2:20

liked by my staff so

2:22

my question is what can we

2:25

do to stick the landing on her introduction

2:27

to the company as an employee? Where are

2:29

some of the pitfalls that we can avoid

2:31

so that my existing team doesn't feel you

2:34

know skipped over or perception and nepotism

2:36

or feel like dad just called

2:38

mom into the room to lay

2:40

down the law. Wow.

2:50

There's a lot there's a lot that could go on

2:52

there wrong. Or

2:55

am I just asking for trouble? No I mean

2:57

then there's a lot and it can be done.

3:01

What's running through my head and I'll get this out so I

3:03

can get it out of my head and move on with the

3:05

core of your question is I

3:07

do think the team might react

3:10

differently to your wife than they

3:12

would to your girlfriend. Okay?

3:17

Okay. I get that you've been together nine

3:19

years but people in

3:21

society do not count girlfriends the same as

3:24

they count wives. Well now

3:26

you sound like her parents. Okay

3:28

well so maybe it's time

3:31

to paint or get off the

3:33

ladder but that's a different subject.

3:35

Okay. Nine years dude seriously okay

3:37

anyway the that might

3:39

help the dynamic but but but I

3:42

wouldn't I wouldn't get married for that

3:44

reason but were you to

3:46

get married for other good reasons it probably

3:48

would help with the dynamic. Now moving

3:52

on regardless

3:54

whether it's your wife or your girlfriend

3:56

coming in any family member that comes

3:58

in and we'll just called

4:00

her family for purposes of this discussion. Okay,

4:03

any nepotism issue. They

4:07

have to do a couple of things. Three

4:10

of them come to mind immediately. One

4:15

is that they need to, she

4:17

needs to early and often verbalize

4:19

honor to the

4:22

existing team for the

4:24

work that has been done before she got there. And

4:28

honor to you as

4:31

the founder that built this thing

4:33

from the ground up. And

4:36

she needs to verbalize that to

4:38

deflect that she's the

4:40

new sheriff in town coming

4:42

in here to slap down a bunch of new

4:44

rules. I'm honor,

4:46

I will often she needs

4:48

to verbalize honor to the

4:51

existing team and to the founder, number

4:53

one. Okay, doesn't

4:55

cost a thing, just some humility. Number

4:58

two, and one of the ways we do

5:00

that around Ramsey, we honor the people that have been here

5:02

a long time and have gutted it out

5:04

when it was tougher around here and we didn't

5:07

have shiny stuff, you know. I grab

5:10

an English pound coin

5:13

and around the edges of the English

5:15

pound is an

5:18

Sir Isaac Newton quote. It

5:20

says, we are standing on the

5:23

shoulders of giants and she

5:26

needs to say that I'm standing on the

5:28

shoulders of giants. You guys have been cooking

5:30

in the heat and in the

5:32

cold. You've been driving trucks that sometimes worked

5:34

and didn't work. You've been serving the customers

5:36

long before I got here. And

5:40

Zach is a warrior and Zach

5:42

is an amazing businessman and I'm

5:44

so honored not only to be

5:46

his girlfriend but also to be

5:48

the CEO, COO to a CEO

5:50

like this of this caliber. And

5:52

that gets it off of her.

5:54

She's deflecting, deflecting, deflecting. That's giving

5:56

honor. Okay, and we do

5:58

that here all the time. We

6:01

constantly are passing honor to the hard

6:03

work that was done 10 years before you came to

6:06

work here By somebody else on the

6:08

team, you know you and you need to honor

6:10

that if you work here Regardless Ramsey or

6:12

not regardless of whether you're a Ramsey family member

6:14

or not. That's thing one Okay thing two

6:16

is she's gonna have to work twice as

6:19

hard just to be respected and

6:21

be twice as good when

6:23

Rachel Cruz my daughter was 16

6:27

15 years old she would get in front of 11,000 people Couldn't

6:29

10,000 people in the event and do this little

6:32

short thing about our kids and money books and

6:34

she was in charge of selling the money books

6:36

at the back of the room the children's books

6:38

at the back of the Room at the break

6:41

and so she helped me with the commercial going into

6:43

the break It was cute funny good-looking

6:45

little teenager kid that had poise she would run

6:47

back there and sell books But the

6:49

whole day I told her if she doesn't work twice

6:52

as hard as everybody on live events Every

6:54

book everything she's not on her phone. She's

6:56

not sitting back there with her feet up

6:58

She has to work twice as hard just

7:00

to be respected Because

7:02

they're all expecting her to be a half-butt Okay,

7:08

so give him honor and plan on working

7:10

twice as hard give everybody else the credit

7:12

you don't get any credit If there's

7:14

ego in your girlfriend the single work She's

7:18

gonna be one of the most diplomatic people I've

7:20

ever met good. She's got to be the boss

7:22

of humility To pull this off. All right,

7:25

so she's honoring them honoring you and

7:27

she's working twice as hard and handing out the credit

7:29

when something goes right To somebody else

7:32

and that's a real leader by the way, that's

7:34

a good quality high quality leader And

7:38

then the third thing is you've

7:40

got to If

7:42

she wants to institute a change 100%

7:47

of change is painful to people even if

7:49

it's good change We

7:51

we resist change even if it's good change

7:54

I update my stupid iPhone to an iPhone

7:56

that is a better iPhone than the other

7:59

one hate it. I

8:01

hate the change. I hate having to learn

8:03

something new, even though it's going to benefit

8:06

me. And so

8:08

that the pain of change,

8:10

the organizational pain needs

8:12

to come on your back, not

8:14

hers. If

8:17

she wants to do something, she

8:19

gets to let you cause it to happen.

8:21

If she has a great idea, it has to

8:24

be your fault. Even

8:26

though we're going to give her credit later, I'm

8:28

not trying to steal her credit from her. But

8:31

don't let them assign

8:33

negative feelings

8:36

to her due to change that she brought to

8:38

the organization that needs to happen because you didn't

8:40

know what needed to happen and she's smart. That

8:44

makes sense? Yeah, yeah. I mean, I

8:46

think we can achieve that if we are

8:49

regularly doing one-on-ones and communicating and

8:51

then you're taking it up and

8:53

you're the one standing up in

8:55

staff meeting going, okay, guys, we've

8:57

been sloppy on the POs. I've

9:00

asked so-and-so that my girlfriend, whatever name

9:02

it is, to help me get that stuff straightened out.

9:04

And we're going to start doing this, this, and this

9:06

with the POs. And it's a little

9:08

tighter than it used to be. We've been sloppy and we're

9:10

going to tighten that up because operationally we're sloppy and

9:13

that's a change. But get used to it. It's my fault.

9:16

And really, the whole idea was hers and you

9:18

never even thought of it. But you're going to

9:20

take the brunt of the pain. You're going to

9:22

take the blame when they're whining about the change.

9:26

Nothing new there. Yeah, but that's part

9:28

of leadership. You know, it's broad shoulders and

9:31

you can do that. You can do that.

9:33

But all of that is just positioning so

9:35

that she doesn't

9:37

get crap on her. Now,

9:39

two years from now, she will

9:41

have earned the right with the team to walk in there

9:43

and go, we're doing something different. She doesn't

9:45

need to lean on you to do that. She'll

9:48

be a COO at that point. But even if

9:50

it wasn't your girlfriend or your wife, the new

9:52

COO that's brand new on the job needs

9:54

to do what I'm talking about. The

9:56

CEO needs to take their crap for a while. Because

10:00

otherwise they lose the hunt they lose their

10:02

their the morale the connectivity to the team

10:04

before they had a chance of turning things

10:06

around So

10:09

right I think it will do those three things you'll be

10:11

okay And

10:13

I can promise you her parents are right so

10:16

there I'm a hundred percent sure of that

10:18

so I Think

10:21

it'll I don't make a lot of difference

10:23

but but if you do those three things

10:25

girlfriend or wife or daughter or son or

10:28

cousin or nephew or Even

10:32

outside new leader they're gonna have to do

10:34

the three things we talked about but more

10:36

so when there's a family connection

10:38

Because people are gonna get the eye roll Going

10:41

like oh, well now that's the girlfriend

10:43

like it was she's doing oh You

10:46

know or oh that's they brought in his wife

10:49

and dad gum man Woman is a

10:51

test pilot for a broom factory and you know look at

10:53

what we got here And you

10:55

know that you know that's that she's

10:57

gonna catch all this crap And you

10:59

don't want the eye roll coming off the team because

11:02

you didn't because she didn't honor them and

11:05

honor you and didn't work twice as hard

11:07

and You didn't take up

11:09

the difficulties of the change and let it

11:11

hit she's gonna get accused of things

11:13

that are not that are ad drama

11:15

that didn't need to be and So

11:19

you know and all of that is

11:21

from experience we've experienced that at Ramsey

11:24

for sure for sure and so

11:27

last thing is And this

11:30

that you didn't ask about this, but When

11:32

you're at work Where

11:35

the CEO hat not the boyfriend hat

11:37

or the husband hat? And

11:41

when you're at work, she's the COO

11:43

and she will talk to you Like

11:46

she would talk to the CEO

11:48

of a company that she worked for

11:51

and you will talk to her Like a

11:54

COO not in a cold way, but

11:56

you know how do I treat my team my

11:59

leaders? dignity. But

12:02

I don't give them my husband

12:04

voice. Okay? You

12:07

don't give her the boyfriend voice. You

12:10

know, you say this is a COO. If

12:13

the COO was not related to me in any

12:15

way, shape, or form, I would talk to the

12:17

COO this way. I would expect this. I would

12:19

handle conflict this way. But

12:22

she can't, you know, start

12:24

going, well, girlfriend, don't do this. You

12:26

know, or whatever the crap that, whatever that sounds like. I don't

12:29

know what that sounds like, but don't do that. You know, but

12:32

I had a husband

12:34

and wife a while back, Zach, that

12:36

I was at a VIP section, an

12:38

Entre leadership event, and she was the

12:41

CFO. He was the CEO, and

12:43

they fought like cats and dogs at work.

12:46

They like had marital fights at work.

12:49

And I looked at him and I said, would

12:51

you talk to your CFO that way? No.

12:55

Well, you are. You need to stop it. And

12:57

I looked at her. I said, if you talk to the

12:59

CEO the way you talk to your CEO, you'd have your

13:01

little butt fired. Nobody put up with your

13:03

mouth. You need to

13:05

stop talking to your CEO that way at work.

13:07

Y'all need to change hats. Now, if you want

13:09

to talk to your husband that way at home,

13:11

that's a marital discussion. That's a different discussion. But

13:13

you can't have your wife

13:15

voice going as the CFO. It doesn't

13:18

work. And she goes, well,

13:20

I'm Hispanic. I said, I didn't get anything to do

13:22

with being stupid. Don't do this. It's

13:25

not a Hispanic disease. It's

13:28

a you're doing the wrong thing right. I mean,

13:30

you're doing the right thing the wrong way. So

13:32

you need to put on your CFO hat and

13:35

address this in a business like professional manner with

13:37

the CEO with dignity and respect so that you

13:39

don't get fired. And she goes, well, he's already

13:41

fired me three times. And I'm going, yeah, you

13:44

probably deserved it. But he

13:46

also shouldn't be talking to you that way either.

13:48

So y'all got it's the same kind of things,

13:50

Zach. So if y'all wear those hats like Henry

13:52

Cloud talks about, you wear the CEO hat at

13:54

work. She wears the CEO hat. And when you

13:56

get home, you wear the husband and wife hat.

13:58

At least that's my prediction in your. future and

14:00

so on. I'm pretty subtle about this act, but

14:02

I hope that's something. Love

14:06

you, brother. Thank you for calling in, man. It's an honor

14:08

to talk to you. It sounds like you've got a great

14:10

business and some really fun stuff ahead of you. This

14:13

is the Entrez leadership podcast. Hey

14:18

folks, I started Ramsey solutions on a card table

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30 years ago. Over

14:22

that time, we had too many different systems

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and they slowed us down. That's

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16:16

I. Got some of your leave and

16:19

some nice reviews. I appreciate it. The

16:21

five star reviews help the show move

16:23

forwards. The sharing when you click the

16:25

share button that helps people know about

16:28

the show and of course when you

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subscribe, that's a big deal. All those

16:32

things up the algorithms. thank you very

16:35

much. One. Of the reviews says

16:37

best business bought podcast on the planet

16:39

What? we think So this is a

16:41

great podcast for all entrepreneurs, new and

16:43

old. Super applicable concepts that transfer to

16:45

any industry. Good, great,

16:47

Show another one says helpmates To start thinking

16:49

about my job from a business standpoint, making

16:51

me a better leader and employee who are

16:54

like that. Last one

16:56

says makes me excited for Monday's I

16:58

love this podcast was do it every

17:00

week. Makes my Monday much better. I'm

17:02

a small business owner about celebrate ten

17:04

years as an entrepreneur in the practical

17:06

wisdom and inside gained from listening to

17:08

Daves. The Callers is fantastic! Appreciate

17:10

the down to earth and hands on

17:13

nature of the podcast versus theory and

17:15

abstract processing. Little bit of that process

17:17

known annoyance. I highly recommend this podcast

17:19

anyone running a business and often send

17:21

episode space to friends and people on

17:24

my team's My only complaint is that

17:26

there's only one episode a week. Give

17:28

us more, it's oh wait, we want

17:30

you to have foam. Oh, so just

17:32

keep doing it on from. At

17:36

at Tara is weather's and

17:38

Cadillac Michigan Hi Tara. How

17:40

are you. Hey. Dave and that

17:42

area better than I deserve. What's up? We.

17:45

are long time dave angeles first

17:48

of all thank you you're welcome

17:50

second of all i am i

17:52

vice president treasury secretary earring other

17:54

behind the scenes stuff because i'm

17:57

also a middle school teacher of

17:59

ace rural medical practice that

18:01

my husband and I own and operate.

18:04

Our top line last year was $697,000 so far this year at $677,000. We

18:06

have seven to eight very

18:13

committed super hard-working employees

18:16

and my question

18:18

is how do we bonus

18:20

our team members in a way that

18:23

they equate that into their overall pay

18:25

package but still incentivize hard work?

18:30

Hmm okay. Well

18:34

there's a couple of things we can talk about there. One

18:37

is in a group of people where you got

18:39

10 people or less like this sometimes

18:42

money spent on experiences

18:45

and food is

18:48

better than the actual cash. Okay.

18:51

So like we

18:53

have done things over the years you can go

18:56

to the local movie theater and

18:58

rent the entire theater out for 500 bucks private

19:01

viewing and especially if

19:03

you got a young crew and they got a bunch of

19:05

kids have you know we played we

19:07

took our Ramsey event center the other day and

19:10

had movie night with Madagascar and

19:12

had the you know had the kids kids

19:14

thing up there and there's like 3,000 people

19:16

there like counting little kids running everywhere you know we

19:19

filled up the thing where there's a thousand of us

19:21

but spouses and little kids you know it we

19:23

just had movie night and that's it doesn't

19:26

cost a lot and yet it shows a

19:28

lot of intentionality just random pizza

19:30

on Thursday afternoon you know or Thursday

19:32

for lunch don't buy anything

19:35

so you know that kind of thing

19:37

a little stuff like that bowling

19:40

night take everybody I don't care whatever it

19:42

is you

19:46

know that the so you can spend a little

19:48

bit of money it doesn't cost

19:50

a lot and shows a lot of appreciation and intentionality

19:52

I would number one I would start doing a lot

19:54

of that kind of stuff I'd make a list of

19:57

ten of those things you can try and try

20:00

to do one a month for the next 12 months

20:02

and see what happens. You know, just

20:05

a little thing. Again, pizza. I

20:07

know I got on a construction site Friday afternoon, he brought a

20:09

keg of beer over, you know, that kind of stuff. Whatever.

20:12

I don't care what you do, but just something that that's

20:16

consistent with who you are and who they

20:18

are and fits the demographic and the age group

20:20

and that kind of stuff. Now

20:22

then to the other part, and

20:26

this works for companies regardless of

20:28

size, we use it

20:30

this concept, these concepts today, and we

20:32

use them back then too. I've

20:35

tried a lot of profit sharing

20:37

type ideas. I'll

20:39

tell you one that didn't work. It

20:42

was an abject failure. We

20:45

were giving, we were allocating a percentage

20:47

of our net profits each

20:49

month, but there wasn't a lot of money because

20:51

in your case there's not a ton of money

20:54

there. It's not like there's a hundred thousand

20:56

dollars you're going to share out of this. Okay, so

20:59

we're allocating a percentage

21:01

of our net profits because like you we

21:03

believe in sharing and honoring the hard work

21:05

of a team. But it was so little

21:07

that if we gave it to a monthly

21:09

it would be like buy you a cup

21:11

of coffee or something. You know, it was

21:13

like a joke. So we did it

21:15

to let we let it build up and did

21:17

quarterly profit sharing. And

21:21

then I had this horrible experience.

21:24

Quarterly profit sharing got up to

21:27

the biggest year it was before I shut it down

21:29

was three hundred thousand dollars one year. Okay,

21:32

which is a lot of money for me. I'm

21:34

from Antioch, Tennessee, right? And

21:36

so that was a lot and it would be it would be

21:38

impossible out of 687 or 676 or whatever, right? But I mean

21:40

it was a lot of money.

21:44

And we had a lady quit

21:49

who was making we were paying her

21:51

her salary was market. And

21:55

she had been with us a while and her portion

21:57

of the profit sharing was like five thousand dollars that

21:59

year. And she

22:01

quit and when her boss who was

22:03

upset that she was leaving her lead

22:06

said why are you leaving? She said well, I

22:08

got a raise. He said what are you

22:10

making and I forget what it was I'll make it up right

22:12

now But say she was making 42 here

22:14

and she said I got a raise to 43 and

22:16

he said you made 48 here last year Right

22:20

and we've had that same thing like last year.

22:22

It was just a thousand dollars. Here's what

22:24

she said This

22:26

is when I canceled the whole dadgum thing. She

22:28

said It's

22:30

it's comes once a quarter and

22:33

I can't it I don't know if it's

22:35

gonna come or not So I don't count

22:37

that And

22:40

I went I gave you people four

22:42

hundred thousand dollars and you don't count that

22:45

oh My

22:47

god, I about had a cow right there in the middle

22:49

of the floor Not in

22:51

her face, but you know what I'm saying?

22:53

I mean it was it was a sudden

22:55

realization that my profit sharing was worthless As

22:59

they did not count it so I stopped at a

23:01

media I said we're not doing anymore and

23:04

then we that we reworked it when now we

23:06

do it monthly But once so a couple things

23:08

is Number

23:10

one I pay we pay

23:13

market rate or above as your standard

23:15

base income. Yeah profit-sharing

23:19

is Extra it is it

23:21

you know, it's not counted in your income. You're not

23:23

gonna count it. It's it's a

23:25

gravy on the biscuit It's me being

23:27

generous. I own the business I could

23:29

take it all home, but I want to share with

23:31

the people that work here It's just pure generosity. It

23:34

is not compensation And so

23:36

I look at it that way they look at that way. The

23:38

second thing is we start doing it

23:41

monthly When we kicked

23:43

it back in and every single

23:45

month we get up and described to

23:47

the whole team Which

23:49

areas made money which area is lost

23:52

money which areas set a record? Yay,

23:54

which areas are struggling booze you Here's

23:58

an example of someone that did something

24:00

that cut expenses and

24:02

then we say profit share, profits

24:04

overall are up and

24:07

so your check, your check this month

24:09

is gonna be a little bit more

24:11

than it was last month with the

24:13

profit sharing in it. Yay! And everybody

24:15

say it together. Here's how profits work.

24:17

Profits happen when revenues go and

24:19

everybody says up and

24:21

when expenses go and everybody

24:24

says down. And

24:26

remember you're all self employed. We

24:28

say that every month for the

24:31

past 15 years we

24:33

had missed a month and everybody knows

24:35

that's where profits come from. So they know

24:37

that if they're doing something to help expenses

24:39

go down or revenues go up they're adding

24:41

the profits and they get to share in

24:43

that. It's

24:45

very much in your face that that's how

24:47

that's worth. So if you guys screw around

24:49

and you let expenses get out of control,

24:52

guess what? Profits go down and so does

24:54

your check, you

24:56

know? And so on. That kind of thing.

24:58

So that's what we do. Number one, you got to set it

25:00

up to where they count it. Number two, you set

25:02

it up, you remind them all

25:04

the time and then number three, make

25:07

sure you're paying a base wage that

25:09

is good anyway and regardless of what

25:11

you're doing here so

25:13

that this is not for a while we

25:15

tried to make profit sharing the

25:17

thing that and we were very generous with profit

25:19

sharing but we tried to make it part

25:22

of your comp plan to get you to

25:25

market. We paid you

25:27

a little bit above market including profit sharing.

25:29

Now we pay you a little bit above

25:31

market plus profit sharing and

25:33

that's changed the whole attitude around

25:36

the thing and making

25:38

it part of being

25:41

at market with the comp. No, I wouldn't do

25:43

that. I think that's a mistake. I

25:45

was a mistake we made. I would recommend not doing

25:47

it which screwed us up. There you go. This

25:50

is the Entre Leadership Podcast. awesome

26:00

at a lot of the stuff you

26:02

do sales marketing motivating your team but

26:05

if you're honest there's a few things that you're

26:08

let's say less good at like

26:10

payroll you know payroll is

26:12

one of the most fundamental things any

26:14

business needs to dial in to keep

26:16

team members happy and productive but

26:19

it can be stressful there are

26:21

a lot of detailed regulations to follow and it's

26:23

how your people get paid that's

26:25

why you need pay orty pay

26:27

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26:30

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26:32

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26:34

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26:36

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26:38

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26:41

direct deposits deductions reimbursements tax

26:43

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26:45

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26:48

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26:50

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26:52

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26:54

go to pay orty comm slash

26:56

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26:59

consultation that's pay orty comm slash

27:01

entree leadership this

27:03

is the entree leadership podcast if you haven't

27:05

heard the rumor we love small

27:08

business people you're 54%

27:11

of the gross domestic product the total of

27:13

all goods and services produced in the United

27:15

States 54% is done by businesses that

27:17

have 500 or less employees Washington poops

27:20

on you every year they

27:22

continually screw up your taxes right this second

27:25

they're screwing up your taxes there's

27:27

one provision that they've not renewed that's costing some

27:29

of you millions of dollars right this second it's

27:31

called 174 call your congressman your senator and tell

27:33

him to kiss your butt until they get that

27:36

fixed it's a lot of money Congress

27:39

has no idea how small

27:41

business works they're dumber they're

27:44

the dumbest bunch of sheep it's unbelievable

27:47

now we understand how small business works and we love you

27:49

we're one of you thank you for being with

27:51

us absolutely incredible

27:54

check it out we'd love to have you

27:56

here thanks for being with us Sal is

27:58

on the line Is

28:00

in Columbia, South Carolina. I sell

28:02

how are you? Hey,

28:05

Mr. Dave. Thank you so much for all you

28:07

do you to how can we help? Yes,

28:11

um, so I have I bought a feed and

28:13

feed store in 2007 and four years ago I

28:16

sold the property in order to

28:19

bring my business to the farm of

28:21

the eighth generation on this property and

28:24

I wanted to get out of the feed

28:26

and feed because all the big box stores

28:28

and we just couldn't compete anymore And

28:32

I came to the farm. So we

28:34

teach home setting we sell feed seedlings

28:37

We have a greenhouse teach

28:39

gardening all kind of different classes.

28:41

So you closed the business No,

28:44

I did not I just moved I'm

28:47

sorry. I thought you got out of the feed to

28:49

seed business. Well, I did I did

28:51

so This is what I need

28:53

help with well part of what I need help

28:56

with so I'm rebranding the business I

28:58

sold the property. Yeah, and and then

29:00

yeah, you went to the homesteading stuff instead

29:02

of feed and seed. I'm confused Yes,

29:05

I did. So I have a huge

29:08

following. I left there with like 18,000

29:10

followers on Facebook and

29:12

so I wanted to keep the

29:15

South all time he feeds well the South

29:17

and Come

29:20

here, so I sold plant seeds that

29:22

was my problem Mary business back there

29:24

and Slowly I

29:26

was stopping, you know

29:29

selling feed and I was slowly stopping

29:31

the hardware We

29:34

had some big box stores move like

29:36

four miles from us. Yeah, I know But

29:39

you basically got out of that business you

29:41

showed the real estate and you at least

29:43

selling those lines So you

29:45

have a whole new business there. So you have a whole new

29:48

business Okay, and that's

29:50

hard to communicate. Yes. So thank you

29:52

so much Yes,

29:55

so I've been here

29:57

four years things are going pretty good

30:00

But my, I know

30:02

you're the king of boundaries, and I am

30:04

having such a hard time with boundaries, because

30:06

this is a seasonal business. So

30:09

we went to a business that was open six days

30:11

a week to a business that's open three days a

30:13

week, and really only

30:15

busy from February to mid-June.

30:18

And then depending on the weather, how

30:20

hot it is in South Carolina, we're

30:23

busy again in the fall for about a

30:25

month and two weeks. And

30:28

then, so the

30:30

other days we're producing what we sell, as

30:32

far as the plant, doing

30:35

marketing, accounting, and et

30:38

cetera. And

30:41

I actually put a gate up, because we

30:43

have a community here. We've got a lot

30:45

of farmers. We've got a lot of backyard

30:47

growers. And I

30:50

put a gate up, so that's one boundary

30:52

I had, so people don't just freely walk

30:54

onto the property, you know, all

30:56

hours a day. I want to make it

30:58

feel like home, but at the

31:01

same time, I can't keep

31:03

getting interrupted, because we've got to produce

31:05

the seedlings. We've got to get ready

31:07

for classes. I do marketing. We're doing

31:09

YouTube. A lot of

31:12

other stuff. But

31:15

the people coming through the gate are where the money comes

31:17

from. Well,

31:19

they do. But- Are

31:21

you doing a bunch of online money? Yes,

31:24

yes. So that's growing. So what percentage of

31:26

your revenue is online, and what percentage comes through the

31:29

gate? It's been growing, so

31:31

it's about 35% now. Online?

31:35

Yes. So you're closing the gate on

31:37

65% of your revenue? Well,

31:41

the problem is- Well,

31:45

the big problem is that we

31:49

need to plant the seedlings in order to sell.

31:52

So we need the Wednesday and Thursday. You

31:54

get that, but nobody- you said the season is

31:56

shut down. If there's a very low

31:58

number- people coming through the

32:00

gate, they're not interrupting you that much. Well,

32:05

everybody likes the place and a lot

32:07

of people come up and ask questions,

32:09

which I love. I love talking to

32:11

people, but at the same time, I've got to

32:14

sit down here and take care of the accounting.

32:16

I've got to take care of the marketing. What's

32:18

your top line? What

32:22

do you mean by that? I'm sorry. What are your gross

32:24

revenues going to be in 23? So

32:28

we did 150 gross. Yes,

32:34

sir. Now,

32:37

we're only busy about five. I have

32:39

another business and then I also do

32:41

a lot of other jobs, too. But

32:45

my passion is really teaching people how to

32:47

grow some high-quality seeds,

32:49

plants. Yeah,

32:55

but your money's coming from people coming through the

32:57

gate and buying stuff from you. They

33:00

are, but it's not enough to hire somebody to keep you. 65% of

33:02

$150,000. Well,

33:07

we're only busy for five months, too. Then

33:09

they're not bothering you the other months. Well,

33:14

but on those days,

33:16

we're now teaching classes and

33:19

we are... Don't they

33:21

have to come through the gate? Are you teaching classes online or are

33:23

they coming through the gate for the class? A

33:26

little bit of both. Not live

33:29

online. So teaching classes, going out,

33:31

setting up gardening beds. So pretty

33:33

much the business almost shut down,

33:36

except for the farm store for

33:38

Tuesday, Friday, Saturday, the rest of

33:40

the year. We're selling a little bit of

33:42

seeds here and there, a little bit of jam, talking

33:46

to people pretty much on Tuesday, Friday,

33:48

Saturday when we're not busy on

33:51

the off season. I am trying to

33:54

keep myself busy on the marketing side,

33:57

but on things that I can actually stuff.

34:00

and then go talk to people with

34:02

not something that takes like a humongous

34:04

amount of brain power or you know

34:07

a huge thing where I have a lot

34:09

of volunteers and we sit there planting and

34:11

also videotaping on the gardening.

34:16

Okay,

34:20

so here's the thing, when

34:22

the customer comes in the front door

34:25

of your online or

34:27

they come in the front gate of your farm, you

34:30

need to set your mindset up and your

34:32

hours up to where they're not a bother.

34:35

I don't like talking to you and hearing that

34:37

your customers are bothering you. No, no,

34:40

no. Your

34:42

job is to take care of them. No,

34:44

they're interrupting your little class, they're interrupting your

34:46

little video shoot for your little YouTube cameo

34:48

appearance and I don't give a crap about

34:50

that. I want you to

34:52

take care of your customer and the

34:54

only reason you're doing YouTube is cause somebody to come through

34:56

the front gate or come online and do the deal. We're

34:59

not doing YouTube for art, we're doing

35:01

it for business, it's a marketing ploy. You're

35:04

not trying to become a YouTube

35:06

star, you're trying to sell stuff and

35:09

you need to get back into business selling stuff and the way

35:11

you sell stuff is you interact with the customer and you love

35:14

the customer. Their customer is not

35:16

an interruption, everything else is an interruption.

35:18

The customer's job one, so if

35:21

you need to set, okay we're open in

35:24

the mornings from 9 to noon except

35:27

on Fridays and Saturdays and we're open

35:29

all day or whatever it is, you

35:31

set business hours, that's fine. There are

35:33

some restaurants that aren't open on Monday

35:35

night, that's fine, I got no

35:37

issue. There's some restaurants that aren't open on

35:39

Sundays, that's fine, I got no issue. I'm not

35:41

mad as the customer on that and they're not

35:44

destroying their business model on that, but you

35:46

got hours all over the place back, forth, sideways

35:48

from Sunday. I've been talking to you for

35:50

10 minutes, I still can't figure out when you're

35:52

open and I guarantee your

35:54

customer can't figure it out either. So

35:58

you got to get yourself dialed in. in

36:00

here and say this is the, in

36:02

the off season, we have two sets of hours,

36:04

off season and non season on season.

36:06

This is when we're open off season. This is

36:08

when we're open post those hours online and on

36:11

the front gate on a really nice sign and

36:13

close the gate when you're closed, but don't close

36:15

the gate. Be shooting a YouTube thing. When customers

36:17

would have been standing out there giving you money.

36:20

That's a bad trade. The

36:22

reason that you do YouTube is

36:25

not for the artistic expression of it. It is

36:27

for marketing. It is to get people to buy

36:30

your stuff so you can serve them and they

36:32

give you their money. That's the

36:34

idea. So customers are not an interruption. And

36:37

so just set your hours up clearly. You've

36:39

not been clear. I know that

36:41

because you can't be clear with me. I can't understand what you're doing.

36:44

And so you've got to have very distinct

36:46

hours off season, on season, certain days, this

36:48

is what it is. And then don't move

36:50

it around 63 times. Let them get

36:52

used to the rhythm of when you're open and when you're not. Like

36:55

we're all of us that walk the planet are

36:57

sure chick fil A's not open on Sunday. We're

37:00

used to that rhythm. They're very clear.

37:03

Okay. Jesus chicken can't get

37:05

it on Sunday. We all know that.

37:07

Okay. It's a done thing. We're not

37:10

mad about it. We get it. We

37:12

get what they're doing. Okay. Sal's not

37:14

open on Tuesdays because she's filming and

37:16

doing classes on Tuesdays. Tuesday, she shut

37:18

down. We all know that if she

37:20

shut down on Tuesday all the time

37:23

and it's not, well, I don't know, cause

37:25

sometimes there I'm doing this and some, no, it

37:27

needs to be set a set of hours on

37:29

your internet site, on your website and on your

37:31

front gate as well, and then spread the word

37:33

in the community and be very, very, very clear

37:36

of what you're doing and where you are. That's

37:38

what you got to do. Don't

37:40

run your customers off by being inconsistent

37:42

or by treating them as a bother.

37:44

That's a bad plan. Wow.

37:49

This is the Ontario leadership podcast. Okay.

37:53

Business owners are passionate folks. In fact, they

37:56

go into business so they can do more

37:58

of what they're passionate about. But

38:00

that passion doesn't usually cross over to

38:02

the financial side of their business. The

38:05

good news is you don't have to

38:07

become a money expert to handle your

38:10

finances wisely. And you

38:12

don't have to become a financial

38:14

expert to do it. In the

38:16

Entrez Leaders Guide to Business Finances,

38:18

you'll learn the profit principles and

38:20

key practices we use here at

38:22

Ramsey Solutions every day. Download

38:26

your free guide

38:28

at entreleadership.com/finances today.

38:32

This is the Entrez Leadership Podcast. You small business

38:34

people are heroes and we're here for you. We

38:37

love you so much. We're going to

38:39

tell you the truth. We're

38:41

going to help you win. We're going to coach you

38:43

up, baby. Thank you for being with us.

38:45

We're honored. Thanks for

38:47

being here. Jamie is with us. Jamie is

38:50

in West Palm Beach, Florida.

38:52

Hi, Jamie. How are you? Hello,

38:54

Dave. How are you? Better than

38:56

I deserve. What's up in your

38:58

world? Well, first, thank

39:00

you so much for having me on. I'm

39:03

honored. So I own

39:05

and operate a small business, but

39:07

we are a cake shop like

39:09

no other. We

39:12

are an experience

39:14

from the moment that you step

39:16

in front of our door before you

39:18

walk into our shop. We're

39:20

very Instagramable and then obviously when

39:23

you open the door, the smell

39:26

of the bakery is just amazing. But

39:29

we also serve daily cupcakes,

39:31

cupcakes, cookies. We have party items

39:34

and so much more that we

39:36

have every day. I've already gained

39:38

five pounds. This is amazing.

39:40

I love it. Well,

39:42

our store is very special. It's only

39:44

600 square feet, but

39:47

we're small, but we're very mighty.

39:49

I think just for reference last

39:51

month, we sold a little

39:53

over 4,000 different items. I

39:57

started this business out of my house. years

40:00

ago. You are amazing. Because

40:03

of the demand, I

40:05

quickly, or not really quickly, in

40:08

between that time I had two babies. I

40:10

was still running the house. I

40:12

wanted to be home with them but

40:14

I can't ever sit still. So I

40:17

continued to run the business and it

40:19

kept growing and growing. So what was

40:21

your gross revenues in 23? What will you redo

40:23

this year? Last year. Well,

40:27

we're pretty good. We hit $4.43 last

40:31

year. So you're making a half million dollars a

40:34

year top line. Okay, good. That's a lot of

40:36

cake. Well done. It is

40:38

a lot of cake. So

40:40

we are growing and growing. We're continuing to

40:42

grow. What's your profit on a half

40:45

million

40:50

dollars?

40:53

I said, oh my gosh.

40:56

I mean, we're... When you did your taxes,

40:58

what did you pay taxes on? That's your profit. I'm

41:02

not the number stat. My husband named

41:05

stat. Did I mention I run this with him?

41:08

I mean, we've done well. We have

41:10

money in the bank and we're still

41:12

going. We started with four employees. Now

41:14

we have nine women in the

41:17

back, front, running business and then

41:19

like I said, my husband who

41:21

handles all that money, side, finances.

41:24

Thank goodness I'm the creative mind

41:26

in it all. So how

41:28

can I help you today? So we're

41:31

wanting to grow. We feel like we've gotten

41:34

the business to a really good point and

41:36

we're kind of in the middle of

41:39

what do we do next? Do we

41:41

try and open another location or do

41:43

we go down the franchising

41:45

route? My question for you is, how

41:47

do you know when it's time to

41:51

grow and how do you know

41:53

the best direction

41:55

to go in for that growth? I

41:58

don't think you're franchisable yet. You

42:01

don't make enough money and you don't have enough

42:03

system styled in yet to be

42:05

franchised. We have a lot of systems. You

42:08

don't even know your numbers. Okay. You're

42:10

a tiny little operation at 600 square feet. You're

42:12

doing wonderful work. It's beautiful. It's a great

42:14

experience, but you're not franchisable yet. You need

42:17

to have done this on a little more

42:19

scale to franchise it. I would open a

42:21

couple more locations, one to

42:23

start with and then another one after you get that

42:25

one operating properly. When you get up to three,

42:27

then you can see that this can operate without you

42:29

in the building and

42:31

still have the magic. And

42:34

you've got systems that are dialed in that are

42:36

repeatable across three different locations and

42:38

then you're making three or four hundred thousand dollars.

42:41

Maybe you got your profit margins up per store

42:43

even, which wouldn't be bad at all. You may

42:45

not be charging enough for these cakes in this

42:47

experience. Once

42:51

you get all that going, then you

42:53

might have a franchisable operation. The problem

42:55

with franchising is it's not as simple

42:58

as just duplicating the one store because

43:00

you've got huge legal expenses to get

43:02

to meet the franchising law. Right.

43:06

Well, we've already started the

43:08

process. I mean, we've been... Well,

43:11

then why don't you call me? I mean, what'd you need me

43:13

for? Because I just

43:15

feel like, you know, I

43:17

feel like we're there and we do have a lot of

43:19

systems in play. Okay. How

43:22

much money have you spent on the legal fees on franchising

43:24

so far? Well, we haven't

43:26

had to do... We're at the very early stages

43:28

of all of that. You're going to drop 100K to

43:30

get ready to franchise. Yeah.

43:34

But we do have some really good systems in

43:36

play. Like, I

43:39

know that I can leave

43:41

and that shop is going to run. We

43:45

have... A customer can come into our

43:47

bakery and say, oh, I need a cake like today.

43:49

Okay. Can you come back in 20

43:51

minutes? Sure. My

43:53

girl's in the back and with the cake and

43:56

the customer can come back. And all

43:58

the magic... All the magic. that is in the

44:00

air doesn't leave when you leave the building? No,

44:03

it does not. Okay. Cause that's how,

44:05

that's what you sold me on early in the

44:07

conversation. That was the, that there's a magic thing

44:09

happening in the 600 square feet. And

44:11

I'm buying that. I believe that. Um,

44:15

and if you've got it where it's delegatable,

44:17

that's a first step. I personally

44:19

would not spend the money on franchising until I

44:21

had a couple of different branches that were making

44:23

money though. You do what you want to do. Um,

44:26

some people do that. Uh, and if that's the direction

44:28

you all want to go, it's fine. We'll still be

44:30

friends, but I, what

44:33

people don't know about franchising is that it

44:36

costs a lot of money to

44:39

become the franchise or in

44:42

preparing the proper legal documents,

44:44

the FDDs, the whole thing. It's a stack

44:47

of paper, two inches thick to

44:49

get ready to be a franchise. And,

44:51

uh, and you have to have something that the

44:54

franchisee sees that they can't figure

44:56

out on their own. That's

44:59

to be a system of proprietary

45:01

methodology, a brand, uh, something

45:04

that they can't do on their own that you

45:06

can do for them. And,

45:09

uh, I

45:11

haven't heard that yet here.

45:14

So you, I think you got a little work to do

45:16

to get ready for that. That's my opinion. You call that

45:18

my opinion and I'm an expert on my opinion. So I'll

45:20

give you that, but I think you

45:23

got something special going there. Uh,

45:25

but personally, I would scale it a little bit

45:27

before I'd spend the money to franchise it because

45:29

franchising is not, um, it's

45:33

not always a dream come true, uh,

45:35

I'll just sidebar on that for the rest of you out

45:37

there. Franchising seems to come up a lot these days. It

45:39

seems to be a thing on tick tack. Everybody's talking about

45:42

it. Uh, and I want you to

45:44

here's what happens. Okay. Let's say

45:46

you have an actual operation, whether it's Jamie's

45:49

or somebody else's and

45:51

you have something that's very different and

45:53

it's very sellable. And you even have a name that

45:55

people are trying to recognize. And

45:58

then you franchise that some. a

46:00

franchisee buys your

46:02

systems because they don't

46:04

have them. They buy your name recognition because

46:07

they don't have it to open

46:09

the store. And

46:11

in the early stages, the

46:13

franchisee, the franchise or is

46:15

real sure that the franchisee

46:18

is successful because of the

46:20

franchise or after

46:23

it's been running for five years, the

46:25

franchisee starts to think that they're successful

46:28

because of them because

46:30

of their hard work, not because

46:32

of the specialness of the franchise.

46:36

And so there's always a love hate relationship

46:39

that can develop and usually does

46:41

between franchisees and franchisors.

46:44

It is a very difficult thing to

46:47

scale without creating that

46:49

love hate relationship because

46:51

the franchise or always feels like that the franchisee

46:53

is successful because of their systems and their name

46:56

and their specialness. The franchisee always

46:58

feels like they're successful because of

47:00

their hard work, their ingenuity, not

47:03

because of the specialness of the franchise. And

47:06

they begin to resent paying the royalties. Typically

47:09

the franchise is a price

47:12

upfront plus a percentage of gross

47:14

revenues as a royalty. And

47:16

they begin to resent paying out that for that

47:18

specialness and for that name because they think they

47:21

are the one that created the success. And the

47:23

truth is both of you needed to be there

47:26

to be the success. The truth is it's about

47:28

a little of both of you. If you're running

47:30

successful franchise it's partly because of your franchise or

47:32

not in spite of them and it's

47:34

partly because of your hard work. But

47:37

these guys there's this constant thing the franchisee

47:40

feels like they did it by themselves more

47:42

than with the franchise or in the franchise

47:44

or feels like the franchisee doesn't appreciate all

47:46

that they did for them. And

47:50

it's a problem y'all. It's

47:52

a problem. I know several

47:54

people that are franchiseeors

47:56

of you know 60 locations,

47:59

100 locations. location, 30 locations,

48:02

and they kind of just wish they had branch offices.

48:05

Be much easier to hire and fire. It'd

48:07

be much easier to run the business and delegate. And

48:10

a lot of people that get into it wish they

48:12

didn't, uh, but they're in

48:14

it. And once you're in it, you're there. So

48:16

that's the thing. Anyway, all that to say, Jamie,

48:18

you're going to spend a lot of money up

48:21

front that you have not anticipated yet, or you're

48:23

going to end up being in violation of one

48:25

of these 73,000 laws that the federal trade commission

48:27

has for franchises, you need to be real careful

48:30

that you're legally compliant

48:33

and to become legally compliant is expensive. So

48:35

be careful with that guys. That's

48:37

how that works. Boys and girls. We appreciate

48:39

you being with us. Remember better aware warrior

48:41

than a quivering critic. This world needs more

48:43

high quality leaders. So take courage and lead.

48:46

I'm Dave Ramsey, your host. Thanks for

48:48

listening to the entree leadership podcast.