July 29, 2024

3 Compelling Reasons for a Business & Cash Flow Forecast

Business Forecasting, Business and Cash Flow Forecasting, business strategies

Powerful Business Strategies is broadcast live Mondays at 12 Noon ET Music on W4CY Radio (www.w4cy.com) part of Talk 4 Radio (www.talk4radio.com) on the Talk 4 Media...

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Business Forecasting, Business and Cash Flow Forecasting, business strategies

Powerful Business Strategies is broadcast live Mondays at 12 Noon ET Music on W4CY Radio (www.w4cy.com) part of Talk 4 Radio (www.talk4radio.com) on the Talk 4 Media Network (www.talk4media.com January Jones Sharing Senior Success is viewed on Talk 4 TV (www.talk4tv.com).

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WEBVTT

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The topics and opinions expressed in the following show are

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solely those of the hosts and their guests and not

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those of W FOURCY Radio. It's employees are affiliates. We

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make no recommendations or endorsements for radio show programs, services,

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explicit or implied shall be extended to W FOURCY Radio

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or it's employees are affiliates. Any questions or comments should

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be directed to those show hosts. Thank you for choosing

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W FOURCY Radio.

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Welcome to Powerful Business Strategies, where you will find out

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that everything you have ever learned about growing your business

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is wrong. Finally, a show where you'll learn the right

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way to grow your business by learning business and financial

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strategies that your competition isn't doing. And now here is

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your host. President of NeXTSTEP CFO Michael Barbarita and joining

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Michael for today's show as an executive moderator is chooky obio.

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Yes, this is chookey, and I believe that gratitude is

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undefeated and growth is about the next step. So look,

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it is an honor to moderate today's discussion with my

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good friend Michael.

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Michael how are you fantastic? How you doing it? Okay?

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Doing well? Look a last star week in July, and

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it's been a phenomenal month from a lot of the

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professional networking and conversations that we've been having with business

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owners and business leaders. So really excited, Michael.

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Excellent, excellent.

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Likewise well, as Chukey said, my name is Michael bober Reader,

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a Next Step CFO, and Next Step CFO is a

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fractional CFO and strategic implementation firm. Our vision is to

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ensure overwhelmed business owners achieve the time, freedom, and consistent

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profits to build a legacy and the life they desire.

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Our mission is dedicated to guiding small business owners to

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leveraging their time, exploding their profit, and build a meaningful legacy.

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The show Powerful Business Strategies in our book of the

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same name, is a step toward accomplishing that vision and mission.

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And so with that, I'd like to hand it back

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to my co author and moderator for the show, Chooky obm.

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Thank you, Michael. So a bit of housekeeping. Folks, very

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excited about today's episode. It's called three Compelling Reasons for

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a Business and cash flow Forecast. We'll start with a story,

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we'll go through some strategies, and then we'll end today's

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session with a new segment which is highly in demand

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from a number of business owners that tune in. It's

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called our Business Compliments segments. So very excited to get

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to that. Quick disclaimer, folks, Michael and I are both

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affiliated with a number of different organizations and I currently

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serve as the managing director of business Development for Veta Price,

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a global business focused law firm. In addition to that,

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I collaborate strategically with Michael to moderate business roundtables really

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all around the country, as well as to document the

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best practices from those roundtables as part of our book,

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Powerful Business Strategies. But please note that today's show and

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the opinions and insights expressed are based on our learnings

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and insights from our successful experiences through the decades. So again,

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very excited about today's show. In my mission as a

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fearless moderators to ask the right questions and to help

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you as a listener, and to help me and help

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us learn the best business strategies that the competition isn't doing.

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With that, I'll toss it back over to Michael.

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Thank you, jokey.

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Yes, you know when I say you're only one forecast away,

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why do I say that? What does it really mean? Well,

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over the next few minutes you'll discover about how you're

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only one forecast away from gaining a greater understanding and

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complete control over your business, your business goals and objectives.

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But before I do that, as everybody probably knows, the

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ski retail business is a seasonal business. So for those

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of you who haven't heard prior episodes, I was in

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the ski retail business in the eighties and the vast

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majority of the ski retail businesses in the industry, at

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least at that time, and I'm pretty sure it hasn't

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changed much since they used a line of credit so

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they could deal with the seasonality of the ski business.

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Interesting, Yeah, makes sense.

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You know, it is a seasonal business and so there's

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cash fluctuations chooking. We were the only ski retail business

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in the country that I knew of that never ever

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used or needed to use that line of credit. Now,

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we had a four hundred thousand dollars line of credit,

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but it was only there if there was a real catastrophe.

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Never ever used it. Yeah, And the and the reason

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was is. We had a business and cash flow forecast,

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and let me tell you why.

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That was the reason.

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The business and cash flow forecast can identify the most

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effective business model you can have, and that's what it

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did for us.

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Uh.

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The forecast told me that I shouldn't go into an

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off season summer business. It told me that I shouldn't

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sell bikes in the summertime. It showed me. It told

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me I shouldn't sell aqua lungus in the summertime. I

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shouldn't sell third for it. The forecast told me this

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because through multiple what if scenarios, the forecast could tell

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you the most effective business model you can have. And

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the forecast told me to close in the off season completely.

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Uh.

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You see, And no matter how rosy a picture I

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paid with counter seasonal business, it produced carryover inventory, and

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that carryover inventory could kill cash flow. And that was

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just one of the contributing factors. There were many others

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that the forecast told me not to go forward and sell.

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Summer goods in the summertime.

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So despite being closed four months out of the year,

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we never needed our line of credit. And the forecast

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told us three critical things. The first was close four

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months out of the year. The second was no matter what,

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and the ski season with a certain amount of inventory,

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and don't go over that amount because then we would

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be in so called the danger zone where we would

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end up with potential cash flow problems. And then do

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what you do best. Was the other lesson that or

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the other item that the forecast told us, and forget

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about the summer stuff.

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Do what you do best.

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And by following the forecast, that reduced our risk and

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maximize our profits and cash flow. So it was really

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it was a game changer, and and many of my

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clients look at it that way as well. And you see, Choky,

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if we know what tomorrow will bring, there are huge

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opportunities to minimize costs and maximize profits. But unfortunately we

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don't know what tomorrow will bring, and that's why we forecast.

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So what is a rolling business and cash flow forecast? Well,

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a rolling business and cash flow forecast is an ongoing

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blueprint that numerically and financially describes the most effective business

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model you can have and what that model will look

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like in the future, all supported by a solid set

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of assumptions. And here's a key word that I said,

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and that was rolling. And that's important because we just

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don't prepare a forecast and throw it in a drawer.

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We use it as an ongoing blueprint. When the actual

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results for the month are realized, we plug those actual

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results into the forecast and let those actual results roll

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forward and see what the impact is on the remainder

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of the forecast. See what changes, see what? See what maybe?

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And sometimes it doesn't change because your actual results were

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very close to what the forecast showed.

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UH. And one more thing, A.

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Business and cash flow forecast must must include a forecasted

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p and L, a forecasted balance sheet, and a forecasted

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statement of cash flows. Without these three components all flowing together,

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the forecast is rendered useless.

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UH.

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For example, cash is on the balance sheet, so if

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you don't have a forecasted balance sheet, you don't know

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what the impact is on cash and cash flow. So

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there are many times when business owners try to get

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away with just a forecasted P and L, But with

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a forecasted p and L, you really don't know what

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your impact is on cash. And so it's important that

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all three statements are incorporated into the forecast.

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Yeah, this is interesting, and Michael, we're getting some really

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good comments here, comments and a mix of questions as well,

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so we'll absolutely get to those. Maybe to take a

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couple of steps back right. Part of the impetus for

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this is the business roundtable conversations Michael, that you and

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I have had, and even taking quite a few business

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owners through the book interview. There's this sense that these

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business owners didn't quite have a grasp on the numbers.

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Yeah, it showed it.

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They basically show that they are they want to avoid

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the numbers at all costs, and this is a process

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and you know, most business owners need help with this.

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It's not that the business owners expected to prepare a

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forecasted p and L, a forecasted balance sheet, and the

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forecasted statement of cash flows.

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Yeah, I didn't know whether you had a financial quiz

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at the end of this place. Get a little nervous.

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Yeah, no, you know, it's the numbers scare a lot

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of business owners, they really do. But unfortunately, the data

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and the numbers and the data are critical if you're

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going to be the CEO of your company. And that

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and the business owners that I deal with, the business

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owners that we've talked to, the business owners that we've

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been debuted are all the CEOs of their company.

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So they really need to get into the numbers a

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little bit.

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And you know, we talked about things like be like

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the vital five for example, you know, sales, gross profit,

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gross profit, percent net profit in cash. If business owners

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just knew those five numbers, that's it. If they just

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knew those five numbers at all times, it would help

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them make decisions and so and so that takes away,

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that takes away some of the impact or some of

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the fear that the business owners would have and the numbers.

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If you just understand those five numbers, you can make

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excellent decisions. And that's all what financial is all about.

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It's it's it's understanding your financial situation so that you

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can make wise and timely business decisions.

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And I want to pick up on that point, uh, Michael,

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and go to a couple of questions here. So one

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question is, as a very busy business owner running a

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number of different types of products and services, how can

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the business cash flow forecast help me make better decisions

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across business units. So that's one slice of the question, Michael,

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and let's maybe just take that and then we could

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drill down a bit.

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Well, what I'd like to do is I'm gonna cover

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that in just the next couple of minutes, So I'd

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rather just go through that. If there's another question I

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could answer, I'd be happy to, But otherwise I'm gonna

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cover that.

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Brilliant Michael, Yeah, why don't you power for that? There

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are questions to that?

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All right? Excellent? So first of all, why forecast?

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Well, there are three compelling reasons, as the show is named,

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three compelling reasons why you need a business and cash

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flow forecast, And number one, it helps you gain a

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competitive advantage. Secondly, it helps you understand your business, and

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third it dramatically improves decision making. So those are the

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three compelling reasons, and here are the points that back

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up those reasons. So, first of all, as you say

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are in my ski business example, that you'll discover the

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most successful business model that you can have if you

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have a business and cash flow forecast, and you'll also

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understand that business model's potential.

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Closing the business in the off season seemed absurd.

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To everyone it still does, but the forecast was right.

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Many times business owners are seeking the right business model,

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and the business and cash flow forecast is a perfect tool.

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For identifying us.

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Sit next, know what your and this kind of starts

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to answer that question, shookey, know what your business can

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and cannot afford on an ongoing basis. Out of all

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of the questions that I get asked as a CFO

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and profit growth strategist, that is the number one question question.

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Business owners want to know what they can and can afford.

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Can they afford a new piece of equipment, Can they

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afford a new product line? Can they afford a manager?

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Can they afford to go to a new location. All

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of these questions are at are on their minds, and

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the Business in cash Flow Forecast answers it with a

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high level of accuracy.

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Remarkable, get some nice compliments related to that. Just really

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so that's very insightful was one comment. Another comment is

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I could also see this as a time management tool

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for me as a business.

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Owner, right because you see, you're always as a business owner,

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you're always required to make decisions, and with the Business

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and cash Flow Forecast, the decisions are laid out for

241
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you very very clearly, and certainly you.

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Might need some help with that, but the help is available.

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And understand that just because the business and cash Flow

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forecast predicts these things with a high level of accuracy.

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You know, I'm not a southsayer, I'm not a gypsy lady, Mike.

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Are you sure about that?

247
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But it's because of the forecast that can give you

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that high level of accuracy.

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Think about this.

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So, if you want to buy a piece of equipment,

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we do what's called a what if scenario of how

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much of a down payment you could afford Step one,

253
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as well as projecting the monthly payments on the loan

254
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at prevailing rates of interest and prevailing terms. So the

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forecast tells will tell you how it impacts cash flow,

256
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and then you can determine if it's worth the risk.

257
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And so when it's laid out in front of you,

258
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the decision becomes easier and less stressful.

259
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Yeah, that's a big one. That's a big one. Some

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reactions to that. In addition to time management, also stress management.

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Michael, right, Because what the problem is is that business

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owners have to make decisions about money, and they don't

263
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like the numbers and so, but the business and cash

264
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flow forecast can make that process so much easier, so

265
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much easier, and.

266
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So and so less time, less time consuming, and less stressful.

267
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So now one of the things we.

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Said is the forecast will tell you how it impacts

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cash flow, and then you.

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Can determine whether it's worth the risk.

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Well, speaking of risks, another benefit of forecasting is understanding

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what the risk and opportunities are in your business. So

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the forecast is a risk assessment tool as well as

274
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an opportunity discovery tool. And we've been in business owners

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this business own God, we business owners face nothing but risk.

276
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We have personal liability risk. We have risks in managing

277
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and having employees. We have risks and managing cash. We

278
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have risks and being undercapitalized and needing money. We have

279
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risk and having inaccurate financial information. We have risk of

280
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having the wrong business model. We have risks in inventory.

281
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If we're an inventory business that has inventory, we have

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risk and tax obligations.

283
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I can go on, I can literally go on the

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rest of the show.

285
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The name all of the risk that business owners have,

286
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and the forecast addresses every one of those risks. And

287
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so it's like I said, it's a risk assessment tool,

288
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but it's also an opportunity discovery tool, and the forecast

289
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helps you under stand what your business cash requirements are.

290
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Well in advance of needing it. This is so you

291
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have the time to get the needed cash or to

292
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arrange to get the needed cash, whether it's to ask

293
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the bank for a line of credit or maybe you

294
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have you need a short term loan from some lending

295
00:18:21.119 --> 00:18:25.640
lending vehicle. In other words, the forecast tells you when

296
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it's cloudy, not when it's raining. You know, many times

297
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business owners, cash flow problems just creep up. Yeah, and

298
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you know, cash flow, cash is the life of a business.

299
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And one of the things we learn is business owners

300
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is things can just turn on a dime, especially when

301
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it comes to cash.

302
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It's very true. And having that.

303
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Foresight when you need additional cash and the time to

304
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make arrangements is literally invaluable. You know, in this world today,

305
00:18:58.920 --> 00:19:04.200
chicky business owners need options and the forecast gives you

306
00:19:04.319 --> 00:19:09.519
time to weigh out those options. So it's a really

307
00:19:09.559 --> 00:19:14.720
it's it's really terrific for cash prognostication and to really

308
00:19:14.799 --> 00:19:19.480
understand how much cash you need or don't need. And

309
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it helps you sleep at night when you don't need

310
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it and when you know you don't need it. The

311
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forecast helps you understand what resources are needed if business

312
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increases or decreases. In other words, at what level of

313
00:19:34.200 --> 00:19:36.839
sales do you need more people? You know, that's a

314
00:19:36.920 --> 00:19:41.400
question that's often asked as well from you know, business owners.

315
00:19:41.400 --> 00:19:46.359
They want to know when is it time? And then conversely,

316
00:19:46.920 --> 00:19:49.839
when do you need less people? So in a difficult

317
00:19:49.920 --> 00:19:55.960
economic time period, the forecast helps you understand when to cut,

318
00:19:56.400 --> 00:19:58.200
how to cut, and who to cut.

319
00:20:00.400 --> 00:20:02.640
At what level of sales do you need more equipment?

320
00:20:04.359 --> 00:20:09.640
The cash flow sorry, the business and cash flow forecast

321
00:20:10.039 --> 00:20:15.680
helps you understand when it's time to get equipment. You know,

322
00:20:15.720 --> 00:20:22.440
this capacity scenarios that the forecast goes through. So if

323
00:20:22.440 --> 00:20:26.440
your business is growing or in decline, the forecast can

324
00:20:26.559 --> 00:20:32.079
tell you where you need to adjust, whether it's headcount, overhead,

325
00:20:32.599 --> 00:20:37.119
or even in your variable costs or cost of good sold.

326
00:20:37.599 --> 00:20:40.839
And the other thing too chooky is the forecast can

327
00:20:40.920 --> 00:20:41.880
calculate metrics.

328
00:20:41.880 --> 00:20:43.799
And I'll get into this more a little later, but.

329
00:20:45.599 --> 00:20:49.200
One metric that the forecast can help you calculate is

330
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a metric called revenue per employee.

331
00:20:53.640 --> 00:20:54.000
And so.

332
00:20:55.480 --> 00:21:01.559
Where there are certain levels of revenue permployee where it's

333
00:21:01.599 --> 00:21:06.720
time to either get more employees or start to cut.

334
00:21:08.240 --> 00:21:11.880
And the forecast helps you understand the optimum number of

335
00:21:11.920 --> 00:21:15.240
people you need and where in the organization they would fit.

336
00:21:16.519 --> 00:21:23.000
So it's really invaluable in understanding what resources are needed,

337
00:21:23.640 --> 00:21:29.119
or what resources or what things can be cut. So

338
00:21:29.200 --> 00:21:32.440
it's very very helpful in that. Once again, this is

339
00:21:32.519 --> 00:21:38.400
all answering that decision making question, okay, and the forecast

340
00:21:38.440 --> 00:21:41.759
helps create multiple what if scenarios for different things that

341
00:21:41.880 --> 00:21:45.759
could happen. For example, many business owners want to know

342
00:21:45.839 --> 00:21:48.440
what profit and cash flow look like if business is

343
00:21:48.559 --> 00:21:53.400
off twenty percent, what has to happen, what's going to

344
00:21:53.440 --> 00:21:55.200
happen if it's off, what does it look like?

345
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What decisions need to be made?

346
00:21:59.000 --> 00:22:03.880
The forecast identifies all of that, Choky, and I don't

347
00:22:03.880 --> 00:22:07.519
know if you remember last week when we were going

348
00:22:07.559 --> 00:22:10.640
over the seven action items that a business owner must

349
00:22:10.640 --> 00:22:14.839
do to prepare for an economic downturn, we said that

350
00:22:14.920 --> 00:22:17.519
the number one tool for winning business owners in an

351
00:22:17.559 --> 00:22:21.440
economic downturn is, in fact, the business and cash flow forecast.

352
00:22:22.640 --> 00:22:26.519
And this week we got some great reactions to that. Yeah, yes,

353
00:22:26.680 --> 00:22:28.720
the bold statement, Michael, Yeah, we got some great reactions

354
00:22:28.759 --> 00:22:29.000
to that.

355
00:22:29.119 --> 00:22:33.839
It was yeah, and I think you're starting to learn why,

356
00:22:34.839 --> 00:22:38.960
I mean, the the the impact that it has people

357
00:22:38.960 --> 00:22:41.720
don't understand that people think that it's just you know,

358
00:22:41.759 --> 00:22:45.480
it's gonna kind of identify what could happen in the future.

359
00:22:46.000 --> 00:22:49.000
But because it's a rolling forecast and we keep it

360
00:22:49.119 --> 00:22:55.519
updated with actual results, it becomes a much more accurate blueprint.

361
00:22:56.160 --> 00:23:01.720
Michael, quick question here just from the audience. How often

362
00:23:01.759 --> 00:23:06.440
should I think about updating my business and cash flow forecasts?

363
00:23:06.440 --> 00:23:08.720
And I know that you're characterizing this as a rolling.

364
00:23:09.200 --> 00:23:12.079
Right, and it should really be updated monthly. It can

365
00:23:12.119 --> 00:23:15.440
be updated quarterly, it depends upon the business cycle, okay.

366
00:23:15.359 --> 00:23:18.480
But primarily it should be updated monthly.

367
00:23:18.880 --> 00:23:23.680
Okay, because things happen monthly. Things things change monthly, as

368
00:23:23.720 --> 00:23:26.279
we As I said earlier, things can change on a dime.

369
00:23:27.319 --> 00:23:30.920
So at a minimum, you really need to update it monthly. Now,

370
00:23:31.319 --> 00:23:34.599
some business owners can get away with quarterly updates because

371
00:23:35.079 --> 00:23:39.440
their business cycle is really determined over a period of

372
00:23:39.480 --> 00:23:42.559
three months versus just a month. But there is some

373
00:23:42.759 --> 00:23:46.200
risk in that, and because because business can turn on

374
00:23:46.240 --> 00:23:46.599
a dime.

375
00:23:46.640 --> 00:23:48.119
You know, when.

376
00:23:48.559 --> 00:23:53.559
COVID hit, I had to get it, get to work

377
00:23:53.640 --> 00:23:59.000
and revise a number of forecasts because there was so

378
00:23:59.079 --> 00:24:02.240
much uncertainty when it hit, and of course it hit

379
00:24:02.279 --> 00:24:04.519
on a dime pretty much, right.

380
00:24:04.519 --> 00:24:06.119
A lot of us remember that, Yeah, a lot of

381
00:24:06.200 --> 00:24:08.720
us remember that, Yeah, Michael, I mean it's a good reference.

382
00:24:08.960 --> 00:24:12.119
But it was incredibly valuable to my clients who had

383
00:24:12.200 --> 00:24:15.640
business and cash flow forecasts because they could figure out

384
00:24:15.759 --> 00:24:20.279
what to do very quickly and understood what the downside

385
00:24:20.319 --> 00:24:24.480
was and if it turned around, and when it turned around,

386
00:24:24.799 --> 00:24:25.920
what the upside was.

387
00:24:26.079 --> 00:24:27.559
You know, would would look like.

388
00:24:30.799 --> 00:24:34.319
Once again, the forecast has the ability to create multiple

389
00:24:34.319 --> 00:24:38.480
on off scenarios, So we were creating forty and fifty

390
00:24:38.519 --> 00:24:41.200
percent off, sixty percent off scenarios sometimes.

391
00:24:42.240 --> 00:24:42.720
Uh.

392
00:24:42.759 --> 00:24:45.960
And you know, and but gave the business owner peace

393
00:24:46.039 --> 00:24:50.079
of mind because we figured out the model that would

394
00:24:50.079 --> 00:24:55.079
work in that scenario, and that without the forecast, that

395
00:24:55.119 --> 00:24:56.079
would have been impossible.

396
00:24:57.079 --> 00:24:58.759
Yeah, I mean I could see that being such an

397
00:24:58.759 --> 00:25:03.720
impact on peace of mind, right, particularly and economically uncertain times,

398
00:25:03.839 --> 00:25:08.079
you know, pressurized times. Very very helpful, Michael. A couple

399
00:25:08.119 --> 00:25:13.039
of just really quick questions. So this idea of uh,

400
00:25:13.279 --> 00:25:14.680
and you know, we may get gets to this a

401
00:25:14.720 --> 00:25:17.160
little bit later. Some folks are asking about systems or

402
00:25:17.160 --> 00:25:22.160
tools that they could use to help prepare these kinds

403
00:25:22.200 --> 00:25:26.680
of business and cash flow statements. But again we could

404
00:25:26.680 --> 00:25:27.039
get to that.

405
00:25:27.519 --> 00:25:29.640
No, I know, I'll be happy to address that. Now.

406
00:25:30.359 --> 00:25:34.960
You just need good bookkeeping. If you have good bookkeeping,

407
00:25:36.359 --> 00:25:41.920
accurate and timely financial statements. Along with good bookkeeping, that's

408
00:25:41.960 --> 00:25:47.400
all you need, you know. And you know you'll need

409
00:25:47.440 --> 00:25:50.160
to answer some questions about your business, which you could

410
00:25:50.160 --> 00:25:53.519
probably do with your eyes closed. That's just that's just standard.

411
00:25:53.960 --> 00:25:57.039
But with respect to anything, any tools that you need,

412
00:25:57.559 --> 00:26:02.240
the only thing that's really necessary is accurate and timely

413
00:26:02.279 --> 00:26:04.119
financials through good bookkeeping.

414
00:26:04.839 --> 00:26:05.039
You know.

415
00:26:05.160 --> 00:26:08.640
You also it's also advisable to have a payroll company,

416
00:26:08.839 --> 00:26:14.079
which I haven't seen many businesses that don't, So that's, uh,

417
00:26:14.880 --> 00:26:16.119
you know, that's kind of standard.

418
00:26:16.799 --> 00:26:20.519
Yeah, And another question, this maybe segues into a couple

419
00:26:20.519 --> 00:26:23.160
of the points that you want to make as we

420
00:26:23.200 --> 00:26:26.680
substantiate this idea of the business and cash flow forecast

421
00:26:27.000 --> 00:26:30.599
really impacting decision making. So some folks want to ask

422
00:26:30.640 --> 00:26:34.720
about how it helps inform a strategic plan, So a

423
00:26:34.759 --> 00:26:38.000
corporate strategic plan for their business, how would a business

424
00:26:39.000 --> 00:26:41.880
cash flow forecast inform that? And it seems like they're

425
00:26:41.880 --> 00:26:43.920
looking at time horizons, like a three year plan for

426
00:26:43.960 --> 00:26:45.519
the business or a five year plan.

427
00:26:46.160 --> 00:26:47.839
Right, we normally do three years.

428
00:26:48.440 --> 00:26:51.440
Once you get beyond three years, it's the predictability goes

429
00:26:51.480 --> 00:26:52.039
way down.

430
00:26:52.880 --> 00:26:55.759
But think about it, if.

431
00:26:56.039 --> 00:26:58.599
You want to know if your business model really works,

432
00:27:00.119 --> 00:27:04.799
if the business and cash for forecast will identify it,

433
00:27:04.880 --> 00:27:08.759
because it will show that you're running out of cash.

434
00:27:08.920 --> 00:27:10.880
I mean, if a model doesn't work, if you if

435
00:27:10.880 --> 00:27:14.519
you have to continuously add more money to the business

436
00:27:15.119 --> 00:27:16.960
and it's not going in the right you know, the

437
00:27:17.160 --> 00:27:21.400
the forecast is telling you that that the that the

438
00:27:21.440 --> 00:27:23.920
model that you have right now is not a profitable

439
00:27:23.920 --> 00:27:27.359
one or the most profitable one, because that's where the

440
00:27:27.400 --> 00:27:32.480
what if scenarios commit. Well, we would change the way

441
00:27:33.559 --> 00:27:37.680
you do business, will change the model, whether it's going

442
00:27:37.759 --> 00:27:41.480
from offline to online, whether it's going from online to

443
00:27:42.559 --> 00:27:46.000
brick and mortar or whatever it is. And it doesn't

444
00:27:46.000 --> 00:27:49.759
have to be retail. It could be the trades. I

445
00:27:49.880 --> 00:27:54.839
work with many many companies in the trades, and we

446
00:27:54.960 --> 00:27:59.759
have changed business models in a number of situations when

447
00:27:59.799 --> 00:28:05.119
we think it's the right move based on the forecast.

448
00:28:06.880 --> 00:28:11.440
So it's been a really in excuse me, a very

449
00:28:11.559 --> 00:28:12.319
valuable tool.

450
00:28:13.279 --> 00:28:14.920
Yeah, I could see that. I could see that, Mike,

451
00:28:14.920 --> 00:28:18.440
I mean that's quite compelling, to be honest. So one

452
00:28:18.440 --> 00:28:21.240
takeaway from that is that a business and cash flow

453
00:28:21.279 --> 00:28:26.720
forecast can actually help inform your business model long term.

454
00:28:27.160 --> 00:28:27.519
Correct.

455
00:28:28.039 --> 00:28:31.200
Yeah, and you know, and and that's the thing, that's

456
00:28:31.200 --> 00:28:33.039
the reason why we do it out three years.

457
00:28:33.039 --> 00:28:34.279
We want to test that model.

458
00:28:34.759 --> 00:28:37.839
Yeah, it could succeed in year one, but then start

459
00:28:37.880 --> 00:28:41.480
to falter and fail in year two exactly, depending upon

460
00:28:41.799 --> 00:28:43.519
how that model is structured.

461
00:28:43.960 --> 00:28:44.200
Yeah.

462
00:28:44.240 --> 00:28:46.400
So, Michael, if I take away from what you're saying,

463
00:28:46.680 --> 00:28:50.119
the business and cash flow forecast helps business owners not

464
00:28:50.200 --> 00:28:51.319
be one hit wonders.

465
00:28:52.279 --> 00:28:54.000
Right, Yeah, it's a good way to put it.

466
00:28:54.480 --> 00:28:55.839
Yeah, that's a good way.

467
00:28:56.079 --> 00:28:57.039
That's a good way to put it.

468
00:28:57.119 --> 00:29:00.880
Like a lot of songs, right, exactly, right, Yeah, that

469
00:29:00.960 --> 00:29:03.640
first good year and then you know the subsequent years

470
00:29:03.680 --> 00:29:07.240
things will look so, yeah, this helps you avoid the

471
00:29:07.319 --> 00:29:09.119
one hit wonder dynamic.

472
00:29:09.240 --> 00:29:10.960
That's very helpful, that's correct.

473
00:29:11.799 --> 00:29:15.799
And so in keeping with that, the forecast establishes the

474
00:29:15.839 --> 00:29:18.200
basis for the strategic plan. You know, if your company

475
00:29:18.240 --> 00:29:21.799
has direction, you feel more confident because you have that direction.

476
00:29:23.559 --> 00:29:26.519
So let's say you wanted to implement the digital marketing strategy,

477
00:29:26.519 --> 00:29:30.119
for example, which is some things that we help customers implement.

478
00:29:31.480 --> 00:29:32.480
That's something.

479
00:29:34.200 --> 00:29:38.079
You know, we can show you what that looks like

480
00:29:38.240 --> 00:29:42.720
financially and how much volume is needed for that strategy

481
00:29:42.759 --> 00:29:46.799
to be worth it before you implement it. You know,

482
00:29:46.960 --> 00:29:50.000
one of the things about the strategic advice that we

483
00:29:50.119 --> 00:29:53.640
give two key is that we cannot only give you

484
00:29:53.680 --> 00:29:56.400
the strategic advice, but we can tell you the financial

485
00:29:56.400 --> 00:30:02.519
realifications of implementing that strategy before you do it. You'll

486
00:30:02.559 --> 00:30:07.559
know what it looks like financially, and as we as

487
00:30:07.640 --> 00:30:11.079
if the forecast tells us to go forward with it,

488
00:30:11.480 --> 00:30:14.079
we go ahead and implement it. We can now still

489
00:30:14.200 --> 00:30:16.400
use the forecast to see if it's going in the

490
00:30:16.440 --> 00:30:19.359
direction we thought it was going to and have and

491
00:30:19.480 --> 00:30:22.160
have the forecast tell us of any adjustments that need

492
00:30:22.200 --> 00:30:23.920
to be made.

493
00:30:24.160 --> 00:30:27.519
Yeah, that's an incredible notable point, right Michael, and I

494
00:30:27.640 --> 00:30:29.880
want to just have us underscore and highlight that. So

495
00:30:30.559 --> 00:30:33.279
oftentimes business owners, I mean, they've got the strategy, but

496
00:30:33.440 --> 00:30:36.079
they've got financial blind spots, or they've got kind of

497
00:30:36.079 --> 00:30:39.519
the financial plan, but they've got strategic blind spots. So

498
00:30:39.559 --> 00:30:43.960
what you're saying is this sort of helps bridge the divide.

499
00:30:44.680 --> 00:30:48.720
Absolutely that you know, it's probably when you think about it.

500
00:30:49.359 --> 00:30:54.880
If you don't combine strategic with financial, then you don't

501
00:30:54.920 --> 00:30:58.960
know if the strategy. Although you're excited, dentally excited about

502
00:30:59.000 --> 00:31:01.440
the strategy, you don't know if the strategy is going

503
00:31:01.480 --> 00:31:05.359
to work in your model, and you don't know how

504
00:31:05.400 --> 00:31:08.839
you have to might have to change your model because

505
00:31:08.880 --> 00:31:14.079
you want to implement this strategy.

506
00:31:14.160 --> 00:31:16.519
So that is really a.

507
00:31:16.640 --> 00:31:21.400
Major major component of building a business. If you have

508
00:31:21.599 --> 00:31:25.039
a strategy and that you know that the strategy that

509
00:31:25.079 --> 00:31:32.839
you're implementing fits financially and is profitable, is productive, and

510
00:31:32.880 --> 00:31:36.880
you know to what degree it's profitable to and productive

511
00:31:36.960 --> 00:31:40.319
before you implement that, all the difference in the world.

512
00:31:41.119 --> 00:31:44.400
Yeah, I just I mean, I so resonate with that point.

513
00:31:44.440 --> 00:31:46.839
In fact, it reminds me of one of the lessons

514
00:31:46.839 --> 00:31:48.759
from your story, right, Michael, I mean just this idea

515
00:31:48.799 --> 00:31:51.440
of not activating that line of credit.

516
00:31:51.680 --> 00:31:51.839
Right.

517
00:31:51.920 --> 00:31:53.920
So what I take away from that, and maybe you

518
00:31:53.920 --> 00:31:57.759
can help clarify this is you, folks were running such

519
00:31:57.960 --> 00:32:02.559
a harmonized strategic and financial plan as part of the

520
00:32:02.599 --> 00:32:05.440
business where you knew that you didn't need to activate

521
00:32:05.440 --> 00:32:08.039
that line of credit even looking looking ahead.

522
00:32:08.079 --> 00:32:12.079
Right, we looking ahead and then actually as time went

523
00:32:12.160 --> 00:32:15.519
on exactly. It was the summertime and we didn't need it.

524
00:32:15.599 --> 00:32:18.160
We had enough cash to carry us to more than

525
00:32:18.440 --> 00:32:22.599
more than carry us into the next season, and it

526
00:32:22.680 --> 00:32:29.200
allowed us to avoid having that carryover uh, those carryover aqualongues.

527
00:32:29.960 --> 00:32:32.839
Uh and that was carryover surfboards and those carryover bikes.

528
00:32:32.839 --> 00:32:35.599
So whatever product we decided to sell in the summertime.

529
00:32:35.880 --> 00:32:40.240
Yeah, I know that. Look, I mean that's actually very insightful.

530
00:32:40.359 --> 00:32:43.279
So really appreciate that. So, Michael, we do have a

531
00:32:43.279 --> 00:32:46.640
couple of questions that are you know, still I see

532
00:32:46.640 --> 00:32:49.200
some folks still kind of submitting questions. But why don't

533
00:32:49.200 --> 00:32:51.640
we power through? I believe you've got a few more

534
00:32:51.640 --> 00:32:53.039
points you want to make and then we'll get to

535
00:32:53.079 --> 00:32:53.759
those questions.

536
00:32:54.200 --> 00:32:57.720
Great, So the forecast helps you understand and determine the

537
00:32:57.759 --> 00:32:59.519
critical metrics.

538
00:32:59.039 --> 00:33:01.599
Of the business. Ah yeah, Now.

539
00:33:01.599 --> 00:33:05.759
Metrics are financial parameters that evaluate the performance and productivity

540
00:33:05.799 --> 00:33:11.480
of the business. But in addition, and in addition, instead

541
00:33:11.480 --> 00:33:16.960
of reading and trying to understand financial statements, metrics help

542
00:33:17.039 --> 00:33:20.880
you interpret what your financial statements are telling you in

543
00:33:21.039 --> 00:33:24.599
more simple terms. And so let me give you an

544
00:33:24.640 --> 00:33:28.839
example of that. Great, So, here are two metrics that

545
00:33:28.960 --> 00:33:33.319
everyone should know about their business. Everyone should know the

546
00:33:33.400 --> 00:33:36.799
average number of days it takes to collect your accounts receivable,

547
00:33:37.519 --> 00:33:40.160
and everyone should know the average number of days it

548
00:33:40.200 --> 00:33:44.400
takes to pay your bills. Okay, Now, the reason is

549
00:33:46.039 --> 00:33:49.440
if you actually calculate those metrics, and the Business and

550
00:33:49.519 --> 00:33:53.720
cash Flow Forecast can help you with that. If you're

551
00:33:53.759 --> 00:33:57.920
collecting your receivables and average of thirty five days, but

552
00:33:58.200 --> 00:34:02.839
paying your bills on an average of twenty days, you

553
00:34:02.839 --> 00:34:05.640
can see that you're paying out faster than you're collecting,

554
00:34:08.079 --> 00:34:10.960
and that is problematic from a cash flow standpoint. And

555
00:34:11.119 --> 00:34:15.920
many times this is why cash flow problems come right

556
00:34:16.000 --> 00:34:22.840
up without you knowing it, because you're paying faster than

557
00:34:22.840 --> 00:34:25.760
you're collecting and it catches up with you.

558
00:34:26.199 --> 00:34:29.760
Yes, now, by knowing these.

559
00:34:29.639 --> 00:34:32.840
Two metrics, maybe your strategy would be collecting receivables faster

560
00:34:33.000 --> 00:34:35.880
or getting extended terms from vendors so that you could

561
00:34:35.920 --> 00:34:39.280
pay slower, or a combination of both. But the four

562
00:34:39.320 --> 00:34:42.639
cast will tell you what would have a greater impact

563
00:34:42.679 --> 00:34:45.960
on cash flow, whether it's collecting the receivables faster or

564
00:34:47.079 --> 00:34:48.159
paying the bills slower.

565
00:34:49.559 --> 00:34:52.559
And just so you know, too, chookey, when I work

566
00:34:52.599 --> 00:34:53.239
with clients.

567
00:34:53.519 --> 00:34:56.360
I study all the metrics so that I could provide

568
00:34:56.360 --> 00:34:59.599
the proper guidance. However, I only share the critical metrics

569
00:34:59.599 --> 00:35:01.800
with the client. And because if I were to share

570
00:35:01.840 --> 00:35:04.760
all the metrics, the client would get paralyzed by the analysis.

571
00:35:04.800 --> 00:35:10.039
The purpose here is not to get paralyzed by the analysis.

572
00:35:10.119 --> 00:35:13.320
I study them all so I can interject them when pertinent,

573
00:35:13.840 --> 00:35:17.400
But in terms of presenting them, our dashboards only show

574
00:35:17.880 --> 00:35:19.079
a couple of metrics.

575
00:35:19.280 --> 00:35:21.480
Yeah, critical ones.

576
00:35:21.679 --> 00:35:23.519
Spat on you really are suits there, I mean you're

577
00:35:23.559 --> 00:35:26.719
a predicted to be honest. That was actually one of

578
00:35:26.760 --> 00:35:29.760
the questions was are all the metrics created equal as

579
00:35:29.760 --> 00:35:31.920
part of this? And you just helped to address that.

580
00:35:32.239 --> 00:35:37.320
Right, that's right, So they're not, and uh, the critical

581
00:35:37.360 --> 00:35:41.639
ones you need to understand and really all you need

582
00:35:41.679 --> 00:35:41.960
to know.

583
00:35:42.679 --> 00:35:42.920
Uh.

584
00:35:42.920 --> 00:35:46.079
And then in the background, somebody is helping you with

585
00:35:47.039 --> 00:35:50.679
really understanding all the metrics so that they can provide

586
00:35:50.679 --> 00:35:54.840
the proper guidance. So that's that's how that's how that works.

587
00:35:56.239 --> 00:35:59.239
But but but metrics are really critical and they you know,

588
00:35:59.480 --> 00:36:03.480
remember earlier we talked about the vital five that there's

589
00:36:03.760 --> 00:36:09.159
five metrics right there that exactly right, and really that

590
00:36:09.280 --> 00:36:10.239
is really.

591
00:36:09.960 --> 00:36:12.880
All you need to know to make the right decisions.

592
00:36:13.119 --> 00:36:16.000
But in order to really get a little bit more

593
00:36:16.000 --> 00:36:18.079
into the weeds, we go a little further with the

594
00:36:18.119 --> 00:36:24.000
metrics analysis. So with a forecast, you'll be able to

595
00:36:24.159 --> 00:36:28.480
understand the outcome and ramifications of your decisions before you

596
00:36:28.639 --> 00:36:32.320
make them. So imagine being able to see the financial

597
00:36:32.400 --> 00:36:35.840
ramifications of a decision before you make it. Imagine being

598
00:36:35.880 --> 00:36:39.039
able to see the financial ramifications of a strategy as

599
00:36:39.039 --> 00:36:42.599
I mentioned earlier, that you like to implement, but it

600
00:36:42.639 --> 00:36:46.360
gives you the foresight to understand whether or not you should.

601
00:36:46.079 --> 00:36:48.159
Implement it before you implement it.

602
00:36:49.519 --> 00:36:53.400
And the forecast helps you understand capacity limitations, how to

603
00:36:53.440 --> 00:36:58.199
maximize capacity with current resources, and in addition, understand how

604
00:36:58.199 --> 00:37:02.960
to expand capacity and what the impact of expanding your

605
00:37:02.960 --> 00:37:05.280
capacity is, being able to.

606
00:37:06.880 --> 00:37:10.400
Produce more maybe hiring more people. All of that part of.

607
00:37:10.320 --> 00:37:13.960
The business and cash flow forecast. And here's the biggest thing.

608
00:37:14.000 --> 00:37:15.599
Here's a well, I should say the biggest thing, but

609
00:37:15.599 --> 00:37:19.480
here's a big thing. Because of the clarity that the

610
00:37:19.519 --> 00:37:24.239
forecast brings you. You'll know more about your business than

611
00:37:24.320 --> 00:37:27.280
eighty five percent of your competitors know about theirs, giving

612
00:37:27.360 --> 00:37:33.239
you a tremendous competitive advantage. Uh, there is tremendous Uh.

613
00:37:33.280 --> 00:37:36.400
There is a tremendous advantage and value in knowing more

614
00:37:36.440 --> 00:37:40.440
about your business. Your competitors don't know most the what

615
00:37:40.480 --> 00:37:43.679
the most effective business model they could have this. Your

616
00:37:43.679 --> 00:37:46.920
competitors don't know their numbers. Your competitors don't know the

617
00:37:47.000 --> 00:37:50.840
vital five. Your competitors don't know what they can or

618
00:37:50.880 --> 00:37:56.159
cannot afford. They throw dots at aboard. Your competitors don't

619
00:37:56.159 --> 00:37:59.239
know the critical metrics in their business and what's and

620
00:37:59.480 --> 00:38:02.639
and that's and what's going to move the needle. Your

621
00:38:02.679 --> 00:38:06.039
competitors don't understand the outcome of their decisions before they

622
00:38:06.039 --> 00:38:10.199
make them. Your competitors don't understand their risks and opportunities.

623
00:38:10.639 --> 00:38:13.519
And your competitors don't know how much cash they need

624
00:38:13.559 --> 00:38:17.480
in advance of needing it. Your competitors don't have the

625
00:38:17.679 --> 00:38:21.440
insight that the business and cash flow forecast gives you.

626
00:38:22.679 --> 00:38:28.800
And that is really some of the those are those

627
00:38:28.840 --> 00:38:32.639
are in a nutshell that'll covers those three compelling reasons

628
00:38:33.559 --> 00:38:36.079
why you need a business and cash flow forecast.

629
00:38:36.119 --> 00:38:37.760
And there's a couple of things I want to add

630
00:38:37.800 --> 00:38:38.280
as well.

631
00:38:38.559 --> 00:38:44.079
Chooky, Okay, forecast acts as a budget as well. So

632
00:38:44.159 --> 00:38:47.480
when people who say budget, the forecast acts as a budget.

633
00:38:47.719 --> 00:38:50.559
It guides you as to what you can spend and wear.

634
00:38:52.320 --> 00:38:56.159
And this is important too that if a business model

635
00:38:56.199 --> 00:38:59.280
does not work in the business and cash flow forecast,

636
00:39:00.199 --> 00:39:03.039
it definitely will not work in real life.

637
00:39:03.280 --> 00:39:05.559
Period. That's a fact.

638
00:39:07.079 --> 00:39:09.480
Yeah, So it's a reality check in a way, right.

639
00:39:09.840 --> 00:39:11.000
Right, that's correct.

640
00:39:12.559 --> 00:39:17.159
And you know, if you don't remember a single thing

641
00:39:17.199 --> 00:39:21.960
that I said today, just remember that the rolling business

642
00:39:21.960 --> 00:39:25.559
and cash flow forecast is so revealing in terms of

643
00:39:25.719 --> 00:39:28.639
understanding the most effective business model you can have that

644
00:39:28.639 --> 00:39:32.679
the business owner can't help but begins develop and implement

645
00:39:32.719 --> 00:39:37.519
the right strategies making their business more successful. So, in summary,

646
00:39:37.559 --> 00:39:41.079
those three compelling reasons to have a business and cash

647
00:39:41.079 --> 00:39:44.880
flow forecast. Is number one, it helps you gain a

648
00:39:44.880 --> 00:39:45.960
competitive advantage.

649
00:39:46.000 --> 00:39:49.000
Okay, gain a competitive advantage. That's one, go ahead.

650
00:39:49.000 --> 00:39:51.679
Two helps you understand your business.

651
00:39:52.360 --> 00:39:54.159
Understand your business, which is.

652
00:39:54.119 --> 00:39:57.079
A competitive advantage as well. But it helps you understand

653
00:39:57.159 --> 00:40:00.400
your business, and it dramatically improves decision making.

654
00:40:00.840 --> 00:40:04.760
Better decision making really well said, So Michael, you struck

655
00:40:04.840 --> 00:40:11.519
a chord with your point by points analysis of what

656
00:40:11.559 --> 00:40:15.880
the competition isn't doing. There's some folks that would want

657
00:40:15.880 --> 00:40:17.440
you to just repeat some of that. In fact, it

658
00:40:17.480 --> 00:40:20.679
was just so well articulated. So, Michael, do you want

659
00:40:20.679 --> 00:40:22.760
to just give a quick recap. How does the business

660
00:40:22.760 --> 00:40:26.280
and cash flow forecast position a business owner to do

661
00:40:26.360 --> 00:40:28.280
what the competition isn't doing?

662
00:40:28.679 --> 00:40:28.880
Well?

663
00:40:28.920 --> 00:40:32.000
First of all, that's a great, great question. So first

664
00:40:32.039 --> 00:40:36.119
of all the clarity that the forecast brings. With that clarity,

665
00:40:36.719 --> 00:40:39.679
you'll know more about your business than most of your

666
00:40:39.679 --> 00:40:43.000
competitors know about their business. And that right there gives

667
00:40:43.000 --> 00:40:45.519
you a competitive advantage because you know more about the

668
00:40:45.719 --> 00:40:49.639
business exactly. There's a tremendous advantage.

669
00:40:50.639 --> 00:40:51.280
In knowing that.

670
00:40:51.320 --> 00:40:54.920
But your competitors don't know the most effective business model

671
00:40:54.920 --> 00:40:59.079
they can have. Your competitors don't know their numbers. Your

672
00:40:59.079 --> 00:41:03.920
competitors don't know they're vital five. Your competitors don't know

673
00:41:03.960 --> 00:41:07.440
what they can or cannot afford. They're throwing dots at aboard,

674
00:41:07.480 --> 00:41:11.760
they guessing. Your competitors don't know the critical metrics in

675
00:41:11.800 --> 00:41:15.199
the business that's going to move the needle. Your competitors

676
00:41:15.239 --> 00:41:18.199
don't understand the outcome of their decisions before they make them.

677
00:41:18.800 --> 00:41:23.159
They just throw dots at a board again, and they

678
00:41:23.199 --> 00:41:26.320
don't understand the risks and opportunities. Because if you don't

679
00:41:26.400 --> 00:41:30.639
understand your risks and opportunities, you.

680
00:41:30.679 --> 00:41:33.239
Really you have a trouble. Yeah, usually have trouble sleeping

681
00:41:33.239 --> 00:41:33.559
at night.

682
00:41:36.039 --> 00:41:37.000
And that's a really big one.

683
00:41:37.079 --> 00:41:37.280
Right.

684
00:41:37.599 --> 00:41:40.400
We hear from so many business owners, Michael of just

685
00:41:41.639 --> 00:41:47.639
the time freedom impacts to why they started their business. Right,

686
00:41:48.199 --> 00:41:52.559
we hear from so many business owners just the legacy interest,

687
00:41:52.679 --> 00:41:55.039
you know, to leave a legacy to their family. That's

688
00:41:55.039 --> 00:41:58.519
why they started their business. So the question here, and

689
00:41:58.800 --> 00:42:01.880
I'm combining a couple of from questions, but how does

690
00:42:01.880 --> 00:42:04.880
the business and cash flow forecast help a business owner

691
00:42:05.440 --> 00:42:08.920
get closer to achieving their number one personal goal?

692
00:42:10.039 --> 00:42:13.400
Well, because the decision making is vastly improved, and when

693
00:42:13.440 --> 00:42:16.880
the decision making is vastly improved, they're making more right

694
00:42:16.920 --> 00:42:22.199
decisions than wrong decisions. And so it accelerates your progress,

695
00:42:22.599 --> 00:42:25.559
It accelerates your productivity as a business owner, and it

696
00:42:25.760 --> 00:42:30.079
ultimately accelerates your growth. And because it can help you scale,

697
00:42:30.199 --> 00:42:33.199
I mean the one of the what if, one of

698
00:42:33.239 --> 00:42:37.559
the what if scenarios is how do I go about scaling?

699
00:42:38.119 --> 00:42:40.039
And what does it take? What does that look like?

700
00:42:40.639 --> 00:42:41.800
How long does it take?

701
00:42:43.480 --> 00:42:47.440
So those are all of the uh, those are all

702
00:42:47.480 --> 00:42:51.119
the questions, the uncertainties that can be answered. But in

703
00:42:51.159 --> 00:42:53.800
a nutshell, it gets to the number one goal through

704
00:42:53.840 --> 00:42:54.880
better decision making.

705
00:42:56.440 --> 00:42:59.920
Really brilliantly well laid out and articulated, Michael. I took

706
00:43:00.039 --> 00:43:02.800
some notes myself. Folks, you probably saw me taking some notes.

707
00:43:03.280 --> 00:43:08.840
This is really actionable, really practical information, Michael. So thank you.

708
00:43:09.719 --> 00:43:13.039
Any other wisdom nuggets, Michael, that you have for us

709
00:43:13.199 --> 00:43:13.840
before we pivot?

710
00:43:13.960 --> 00:43:17.039
Well, can really quickly can I give you some bonus content?

711
00:43:17.280 --> 00:43:17.800
Oh? Please?

712
00:43:17.840 --> 00:43:18.320
Absolutely.

713
00:43:18.400 --> 00:43:20.599
This is something I think a lot of business owners

714
00:43:20.599 --> 00:43:22.840
don't understand, and that's personal liability.

715
00:43:23.400 --> 00:43:26.199
It's one of the risks that I talked about earlier.

716
00:43:27.039 --> 00:43:29.320
And first of all, many business owners think that because

717
00:43:29.360 --> 00:43:33.119
we have corporations, we are protected from personal liability. And

718
00:43:33.119 --> 00:43:36.960
that is correct to a point, except for when you

719
00:43:37.039 --> 00:43:40.719
can tractually sign a personal guarantee. Now many of us

720
00:43:40.760 --> 00:43:47.559
do that with banks, leasing companies, credit cards, and vendor contracts. Beware,

721
00:43:48.000 --> 00:43:51.679
if you have to sign a vendor agreement twice, it's

722
00:43:51.719 --> 00:43:56.400
probably because the second signature is a personal guarantee that

723
00:43:56.480 --> 00:43:59.920
you're signing. If you have to sign a vendor application

724
00:44:00.079 --> 00:44:05.079
and twice read it and make sure you're not signing

725
00:44:05.119 --> 00:44:09.039
a personal guarantee, and cross it out if you are.

726
00:44:09.719 --> 00:44:12.239
Because many of my clients have been doing business with

727
00:44:12.320 --> 00:44:17.960
certain vendors for years and always paying on time. But

728
00:44:18.079 --> 00:44:22.800
if something goes wrong and the economy changes rapidly and

729
00:44:23.000 --> 00:44:24.880
you run into problems, you don't want to have that

730
00:44:25.000 --> 00:44:27.920
personal guarantee out there with a vendor that you've been

731
00:44:27.960 --> 00:44:32.119
paying hundreds of thousands of millions of dollars over years

732
00:44:32.440 --> 00:44:37.800
of time on time. Ask them why they don't, Ask

733
00:44:37.840 --> 00:44:40.679
them why they need it anymore because they don't need

734
00:44:40.679 --> 00:44:44.880
it anymore, and have your attorney make it null and void.

735
00:44:45.159 --> 00:44:47.880
The other thing is whether you have a corporation or not,

736
00:44:49.199 --> 00:44:51.599
you're personally liable for fiduciary taxes.

737
00:44:51.599 --> 00:44:52.239
Well, what are those?

738
00:44:52.320 --> 00:44:55.400
Those are taxes like payroll taxes and sales taxes.

739
00:44:55.920 --> 00:44:59.480
Think about it. That's not your money, You're just a fiduciary.

740
00:45:00.000 --> 00:45:02.960
The responsibility of taking someone else's money and paying it

741
00:45:03.000 --> 00:45:07.119
to the proper authority. That is personal liability. And finally,

742
00:45:07.199 --> 00:45:09.960
really quickly ask your attorney.

743
00:45:10.480 --> 00:45:11.480
But I believe the.

744
00:45:11.519 --> 00:45:15.000
Treasure of a corporation is the officer of a corporation

745
00:45:15.079 --> 00:45:18.159
that is the most financial responsibility for the company and

746
00:45:18.239 --> 00:45:20.960
can be held personally responsible.

747
00:45:22.440 --> 00:45:24.880
Back to you, Checky for the compliments. I don't know.

748
00:45:24.960 --> 00:45:27.639
I mean, Michael, great additions to be honest, and I'm

749
00:45:27.679 --> 00:45:31.679
glad you connected those dots and folks, look, if you

750
00:45:31.719 --> 00:45:34.840
need professional advice on any of the points that Michael noted,

751
00:45:35.480 --> 00:45:37.920
please And Michael, one things that we always tell the

752
00:45:37.960 --> 00:45:41.320
business owners in our roundtable is please seek the advice right,

753
00:45:41.400 --> 00:45:43.079
you know, get the help you need.

754
00:45:43.119 --> 00:45:45.199
Correct, get the help, get that help help you need.

755
00:45:45.280 --> 00:45:48.719
So we're very excited about this segment. Again, this is

756
00:45:48.960 --> 00:45:53.960
highly in demand and recommended by a number of listeners.

757
00:45:54.000 --> 00:45:57.079
It's a business complements segment. So what we do is

758
00:45:57.159 --> 00:46:00.400
we spotlight a number of business owners coasts to coast,

759
00:46:00.559 --> 00:46:03.400
and today we have four business owners that we want

760
00:46:03.440 --> 00:46:07.760
to spotlight. So the first is Eric Wing with Darby

761
00:46:07.960 --> 00:46:10.800
Digital Marketing. And part of what we really want to

762
00:46:10.800 --> 00:46:12.599
spotlight with Eric, I mean, there's so much to love

763
00:46:12.639 --> 00:46:15.000
about Eric, Michael, as you know, but part of what

764
00:46:15.039 --> 00:46:20.599
we wanted to command Eric on was his strategic marketing approach.

765
00:46:21.559 --> 00:46:26.079
There's a very strategic way that Eric approaches his Marketing

766
00:46:26.199 --> 00:46:31.159
Engagements and just wanted to endeavor to give Eric a

767
00:46:31.239 --> 00:46:35.079
shout out on that. And Eric's based on the East Coast.

768
00:46:35.760 --> 00:46:40.480
The second is Vanil ram Chandron and he is with

769
00:46:41.000 --> 00:46:42.719
Dream Business Brokers.

770
00:46:44.639 --> 00:46:45.239
What we wanted to.

771
00:46:45.239 --> 00:46:51.119
Spotlight about Vanil was his three pi's of service, Purpose,

772
00:46:52.000 --> 00:46:58.480
promise and people. He informs his service to business owners

773
00:46:58.519 --> 00:47:02.840
seeking to sell the businesses across those three p's really

774
00:47:03.800 --> 00:47:07.039
impactful and inspiring. The third business owner and by the way,

775
00:47:07.119 --> 00:47:11.000
Vanilla's out west. The third business owner is Eric Harris

776
00:47:11.159 --> 00:47:17.599
with curta Pro. Eric's entrepreneurial journey is just really motivational.

777
00:47:17.719 --> 00:47:19.480
If you folks get a chance to connect with Eric,

778
00:47:19.639 --> 00:47:23.119
he's out east, and part of what I wanted to

779
00:47:23.639 --> 00:47:29.559
spotlight with Eric is his extraordinary mindset when it comes

780
00:47:29.559 --> 00:47:33.079
to client service. Eric and his team really make it

781
00:47:33.079 --> 00:47:35.559
a point to go above and beyond, so not just

782
00:47:35.599 --> 00:47:38.239
to do the paint job, but to do the paint

783
00:47:38.320 --> 00:47:42.440
job with excellent So tip of the cap to Eric.

784
00:47:42.480 --> 00:47:46.599
And then the fourth business owner and Michael, I think

785
00:47:46.599 --> 00:47:50.440
you might be excited about this one. This is Jj

786
00:47:50.599 --> 00:47:56.119
Prabilski with Master Dawn Moving and Jj and his business

787
00:47:56.679 --> 00:48:02.119
were just recognized in the ink I've Michael, I'll let

788
00:48:02.119 --> 00:48:02.679
you finish.

789
00:48:02.519 --> 00:48:04.639
Five thousand, five thousand, thousand, I.

790
00:48:05.039 --> 00:48:07.760
Want to do complete Yeah, privately.

791
00:48:09.000 --> 00:48:11.920
Eight five thousand privately held companies. He doesn't know where

792
00:48:11.960 --> 00:48:14.599
he ranks yet. He won't know until August sixth I believe,

793
00:48:14.800 --> 00:48:17.400
okay where he rags, but he's one of the top

794
00:48:17.440 --> 00:48:21.840
five thousand privately held fastest growing privately held companies.

795
00:48:22.039 --> 00:48:22.360
Brilliant.

796
00:48:22.400 --> 00:48:24.360
Yeah, I mean Michael saying I figured you were suits

797
00:48:24.480 --> 00:48:27.440
on a mind reader, so you were sort of Yeah.

798
00:48:27.480 --> 00:48:32.039
I think five thousand is just impressive. So compliments to JJ,

799
00:48:32.320 --> 00:48:36.440
complements to Eric Harris, complements the Vanil and then complements

800
00:48:36.480 --> 00:48:40.119
to Eric wink Michael, anything else, I.

801
00:48:40.079 --> 00:48:41.360
Think that's a choky.

802
00:48:41.440 --> 00:48:43.800
Other than to get a copy of the book Powerful

803
00:48:43.840 --> 00:48:47.559
Business Strategies, simply go to our website www dot next

804
00:48:47.559 --> 00:48:51.360
step CFO dot net. It's totally complimentary and until next

805
00:48:51.440 --> 00:48:52.920
Monday at noon Eastern.

806
00:48:52.559 --> 00:48:54.119
Time for Chucky Obio.

807
00:48:54.400 --> 00:48:58.079
My name is Michael Barbarita, and remember, don't keep doing

808
00:48:58.400 --> 00:49:00.360
what your competition is doing.

809
00:49:00.719 --> 00:49:02.480
Thank you.

810
00:49:02.480 --> 00:49:05.559
You have been listening to Powerful Business Strategies, finding out

811
00:49:05.599 --> 00:49:09.239
that everything you ever learned about growing your business is wrong.

812
00:49:09.519 --> 00:49:12.719
Tune in next week and every week at noon Eastern

813
00:49:12.800 --> 00:49:16.239
time on W four CY Radio with your host Michael

814
00:49:16.280 --> 00:49:20.880
Barbarita of Next Step CFO and moderator chugy Obio