The Hidden Profit Formula: Finding Money Your Competition is Missing

0:00 The topics and opinions expressed in the following show are solely those of the hosts and their guests and not those of W FOURCY Radio. It's employees are affiliates. We make no recommendations or endorsements for radio show programs, services, or products mentioned on air or on our web. No liability explicitor implies shall be extended to W FOURCY Radio or its employees are affiliates. Any questions or comments should be directed to those show hosts. Thank you for choosing W FOURCY Radio. Welcome to Powerful Business Strategies, where you will find out that everything you have ever learned about growing your business is wrong. Finally, a show where you'll learn the right way to grow your business by learning business and financial strategies that your competition isn't doing. And now here is your host. President of Next Step CFO Michael Barbarita and joining Michael for today's show as an executive moderator is chooky obio.

1:01 Yes, this is chookey, and I believe that gratitude is undefeated and growth is about the next step. It is an honor for me to moderate today's discussion with my good friend Michael. Michael, how are you very good? I thank you, Chicky, very good. My name is Michael Baberider Next Step CFO. Next Step CFO is a fractional CFO and strategic implementation firm. Our vision is to ensure overwhelmed business owners achieve the time, freedom, and consistent profits to build a legacy and a life date desire. Our mission is dedicated to guiding small business owners to leveraging their time, exploding their profits, and building a meaningful legacy.

1:43 And this show, Powerful Business Strategies in our book of the same name, is a step toward accomplishing that vision and mission. So with that, I like to hand it back to our to my co author and moderator for the show, Choky Obio. Michael, look, I'm quite inspired by today's episode. So the title is the Hidden Profit Formula Finding money your competition is missing, And Michael, as you know, I mean, we're growing our interests in really helping business owners do what the competition isn't doing with their strategy and their growth plans, particularly this time of the year. Right, it's just really interesting. So before we get into a Michael, just a quick disclaimer.

2:24 So Michael and I are both affiliated with a number of different organizations, and I currently serve as a Managing Director of Business Development for Vetaprice, a global business focused law firm. In addition to that, it's truly an honor to collaborate with my friend Michael to moderate business roundtables and document best practices from those roundtable discussions with business owners. But please note that the opinions expressed, the views expressed, and today's show are based on our personal success experiences. But my mission as the Fearless moderator for today's show is just to ask the right questions and to help you, the listener, learn the best strategies that the competition isn't doing.

3:13 So with that, I want to toss it back over to Michael. Thank you, Chivy. So, did you know that most businesses capture less than sixty percent of their potential profit? So think about that. Wow. Yeah, twenty percent of your possible profit is slipping right through your fingers every single day. And I'm not talking about cutting expenses or raising prices. I'm talking about money that's sitting right in your business that you can't see because you're looking at all the wrong places. So, over the next forty minutes or so, I'm going to share specific strategies that have helped business owners uncover these hidden profits, and I'll show you exactly how one business owner found the next year one hundred and fifty seven thousand annual profit without spending a dime on marketing or raising their prices.

4:04 Think about that and think about what that kind of money could mean for your business and your family. And I'm going to give you examples of what I call the hidden profit formula. This is a systematic way to find money in your business that your competition is completely missing. And the best part is on You know, with a look, you can repeat the process over and over again. So grab that pen and paper, because I'm going to share strategies that will completely change how you think about profit in your business. And if you're driving, don't worry. You could catch the episode again on our podcast at Powerful business Strategies dot com. So if you're just joining us, we're talking about finding hidden profits in your business and I promise to show you exactly how to do that.

4:52 So let me tell you about Jim. Jim runs a successful distribution company, and like most business owners, he was focused on the obvious ways to increase profit, sell more cut costs, maybe raise prices a bit, but it was missing something huge and I'm going to show you exactly what it was. So the first place we looked for hidden profit is what I call the invisible inventory. So and I know what you're thinking, Michael, I know exactly what's in my inventory, and I get that. But here's what we discovered. When we dug deeper with Jim's company. We did what we called a velocity analysis of his inventory.

5:35 It's basically inventory turns, some people call it. And instead of looking at what he had and stock, we looked at how quickly different items moved through his warehouse. And here's what we found. So thirty five percent of his inventory hadn't moved in over a year, So that's cash that was sitting on the shelves, gathering dust and eating up storage space. But then another twenty five percent of his inventories were moving so quickly that he was constantly running out. So he's losing money on both ends. Too much of what wasn't selling, not enough of what was. So we implemented what we called the inventory sweet spot system.

6:19 And here's how that worked. So you create four zones right on the floor four areas right on the where the inventories being stored. And you come up with the red zone, and it's in the red zone items that haven't moved in six months. And you put all those items that haven't moved in six months into the red zone into the yellow zone items with sporadic movement, so they were moving faster than the stuff there wasn't moving, but not that fast. The green zone was fast moving items, and the blue zone were critical items regardless of movement.

6:59 And these of just the important, the real important stuff that was critical to the to the to the majority of the customer base. So for each zone, we created a specific action plan m HM. So red zone where the items that haven't moved in six months we liquidated or returned to the vendor or or there's another thing that's interesting, you can bundle them with the fast moving stuff just to get rid of it and and basically you know, increase the price modulely uh. The yellow zone where items with sporadic movement, you reduce the quantities and negotiate better vendor terms with the initially better terms with the vendors. In the green zone. This was for fast moving items. This is where we increased stock, and we set up an automated reordering system. And then the blue zone, which was the critical items regardless of movement. We maintained safety stock regardless of cost. So we knew we always had stuff in the blue zone and also in the fast moving items, so we made sure we always had excess inventory there, but we made sure that we had very low levels of inventory in the red and the yellow zone. And so the results were interesting because in ninety days, just ninety days, inventory carrying costs dropped by

8:30 twelve thousand dollars a month, storage space decreased by forty percent, stock outs reduced by eighty five percent, and rush shipping costs were nearly eliminated because everything was available that really moved. When you understand what moves and what doesn't, you can really eliminate that those rush orders in terms of the additional shipping costs and the disruption. But here's what's really interesting. Overall profit increased by one hundred and fifty seven thousand annually just from better inventory management. And that's money that was literally sitting in his shelves. So let me show you another example that will really drive this home. So Sarah, she runs a successful service business, and she thought she knew her profit margins on every service that she offered.

9:24 But when we did what we called a true cost analysis, we found out something that we just weren't aware of. It. We broke down every service into its smallest components, so that means direct labor time, materials and supplies, and any additional hidden supplies that we used on these jobs. By the way, equipment usage, administrative time, follow up time, and hidden costs like travel or setup that she wasn't concnsidering at all. So direct labor time, materials, it supplies she always was considering. She did miss some supplies that she thought were just, you know, part of the cost of doing business, but it really came down to where she found the pickup was equipment usage, administrative time, follow up time, and travelers set up. And what we discovered is our most popular service, the one she thought was the most profitable.

10:32 It was actually losing money on thirty percent of her jobs because she wasn't accounting for what those invisible costs. She wasn't tracking time spent on quote revisions, wasn't tracking multiple site visits, so only accounting one site visit. She wasn't tracking additional administrative work to complete that job. She wasn't accounting for or tracking equipment set up in breakdown time, she wasn't tracking travel time between the jobs. So once we identified these hidden costs, we created a profit protection protocol for every service. And so now we tracked the based service time, the support time requirements which was totally missing, the travel radio zones, the setup and breakdown time was totally missing, additional administrative requirements and follow up needs. And then we repriced our services based on true costs. And here's what ended up happening. She actually lowered prices on some services and raised them on others, and the result was her overall profit increased by forty two percent in just ninety days just by understanding her costs. She was outstanding what yeah, just wasn't understanding what her product, what a service cost was And when we broke it down,

12:04 and we had to go really deep because things like that set up and breakdown time, it's just something that some business owners never consider. Some addigital administrative requirements, that's another thing, you know, and then a lot of the follow up needs. You know that those costs that are getting curred after the sale is delivered. That's another thing that wasn't considered. And once we knew the true cost of every component of our service, we can start optimizing each one. And we found that small job fall changes and how jobs were scheduled would compound on each other and and and could say forty five minutes of travel time a day if the scheduling was done properly, And that's almost four hours a week of pure profit opportunity that was being wasted. So this is just the first place where we look for hidden profit. You know, most business owners that just focused on sales, margins, expenses, hutting expenses, maybe increasing prices, but they missed these invisible profit trains.

13:17 It's like having a leak in your profit bucket, but it just can't see where the water is coming out. So let me show you something even going a little deeper here with the hidden profits. So remember when I mentioned those invisible costs that Sura discovered in our services. Well, there's another layer to this that most business owners never see, and that's what I call a profit chain reaction. And here's a great example. When we worked with a manufacturing client, we discovered that they were losing money on rush orders. Now, most business owners would say, well, let's just charge more for rush orders, but that's just surface level thinking. When we dug deeper, here's what we found that rush orders disrupted regular production. So there wasn't just an additional cost of you know, rushing. There was this disruptive to regular production.

14:18 This caused delays and standard orders. The delayed orders led to overtime costs over time, led to quality issues due to the fatigue of employees, and then the quality issues led to a warranty claim or it led to more warranty claims. So it was like a domino effect that was actually costing this manufacturing company two hundred grade a year. Oh wow, yeah, it was just it was just all these hidden costs that were that were developing just from rush orders. Mike think, it's not a big deal, you know, you get it out quicker, but it just caused all kinds of eruption to the regular standard orders, and the cost was a lot bigger than what they were charging for the rush orders. And so we divided their production capacity into three zones, so a green zone for standard capacity, a yellow zone for flex capacity, and by the way, the green zone for standard capacity. It was eighty percent eighty percent of their orders with like standard orders, fifteen percent was some flexible flexible timing was when the customer needed it. That was in the yellow zone. In the red zone that was where the emergency stuff was, and that was really just five percent of the business, but it caused all this disruption, and so then we priced each zone differently. The standard pricing was in the green zone that was eighty percent of the orders. Fifteen percent

15:50 of the orders was flex in terms of timing when they needed it. That was a fifty percent premium, and then there was one hundred percent premium on the red zone. So that properly pricing it so because of the cost that it was really causing. And then so they hired a swing shift crew that only worked when yellow or red zone orders came in. And the results was that regular production never got disrupted. Quality issues dropped by eighty five percent. In terms of quality problems from the field that dropped eighty five percent. Over time, costs practically disappeared.

16:31 Russia owner profits increased by three hundred percent because we were finally pricing it right, and then customer satisfaction hit up all time high there was less quality issues. Wow, So this is what I mean by finding hidden profits. It's not just about raising prices are kind of costs. It's about understanding the entire profit ecosystem in your business. Every problem, every bottleneck, every customer complaint is actually pointing you for hidden profit opportunities. And so when we took back from our ninety second break, we'll talk more about finding hidden profits in your business. Great. Hey there, business owners, let me ask you something. Are you tied of blending in with your competitors? Frustrated with slow growth and slim margins? Well, I've got news for you. Everything you've ever learned about growing your business is wrong. But don't worry. I'm here to let you in on a secret weapon. Your position of market dominance. It's what sets you apart, makes you irreplaceable, and has customers lining up at your door. My name is Michael Barbarrita from Next Step CFO. I know what you're thinking. Sounds great, Michael, But how do I find my position of market dominance? Well that's exactly why we've created our game changing impleitation program called Next Step to Market Dominance. In just ninety days, we'll guide you step by step to a position of market dominance by uncovering

18:03 your unique strengths that competitors can't touch. By crafting a message that resonates deeply with your ideal customer, by building a strategy that turns you into the go to expert in your field. Now this is in theory. These are battle tested strategies that have helped businesses like you as double, triple, and quadruple their revenue. Don't let another quarter go by struggling to standout. It's time to dominate your market period. Go to NEXTSTEPCFO dot net forward slash contact. Fill out the form and in the message section put the word dominate or call us at seven eight one three two six three A two two. That's next STEPCFO dot net forward slash contact or call us at seven eight one three two six three A two two. So welcome back.

18:53 And if you if you're just joining us, we're talking about hidden finding hidden profits in your business, and I'm going to show you something that will completely change how you think about pricing and profitability. So let me introduce to you what I call the profit multiplier matrix. Perfect and Michael, before we jump into that, I think let's take some questions, because we've gotten some really good activity here from business owners who are listening. So here's kind of a high level question, hidden profits. Why call it hidden? Well, the main reason why we call it hidden is because as business owners, we always think of just about sales expenses, raising prices, kind of costs, you know, our gross profit minditt all important stuff. By the way, I don't want to minimize it, that's very important. But but if you, if you listen to or if you if you look at your process and you listen to customer complaints, you can find actually hidden profit opportunities not just assuage the customer or satisfy the customer by solving whatever issue that they might have, but also going deeper and seeing what could be profitable instead of thinking all about all this stuff is a negative or a cost, look and see where the profit can be helped and and and charge for. Like in the case of one of those examples that I gave you, the rush the rush orders

20:25 were killing them. It was disrupting the whole place. So when a customer has a rush order, you really have to try to understand what is taking place from a from a cost standpoint, and see where you can optimize your pricing really to coordinate that. It just it's just a scenario, especially like inventory. That's another thing. You know your inventory is, you know where it is, but you just don't know how fast it's moving. And you've got to You've got to identify how fastest movie because if it's slow moving stuff, you got to get rid of it at any cost, at any cost.

21:06 It's funny, Michael, we're getting some really good comments here. A couple of amen's to that, right, you know, a couple of uh comes up another kind of really quick question. So this idea. Oftentimes when you have these conversations around hidden profits or where to find profit in a business, the concept of value perception comes in. It's like, how can I position something to the marketplace where customers would have the right value perception of that? And we may get into this later, but I would love just your. Actually we want to get into this lationship, so we just get it to know. Well, that's where that position of market dominance comes in, because you need to have you need to identify the problem the customer has if they don't want well coming up with a unique solution that they want, they can't fund nice and once you have that in place, then then the music will stop. Yeah, and then you know you'll start to that's where that's where the value comes in. That's where you increase that value of what you offer. I like buying that problem because without identifying the problem, you're doing all this meat too stuff and you're not really uh, focusing on value.

22:20 But that's the area when you look at it, because it's a messaging that really drives the revue, you know, drives the the sales and uh that position of market. Oct you might like this where you talked about that's where the music starts. A lot of folks are saying is that rock music is that classical music. It's when the music stops that you have to worry exactly. And it's any kind of music that you like exactly that you think of relative to uh a productive business. I love that. Yeah. Good. So let me tell you Mike who runs a successful agevac company. And like most contractors, you know, he had a standard pricing system parks labor markup done, and he thought he was maximizing his profit. But here's what he discovered when he dug deeper. He did what he what he called a value perception analysis, So instead of just looking at what things cost, he looked at what customers actually valued. I guess this is something something toward the question you were asking as well. Yes, And here's what he found. He found sixty five percent of customers would pay more for same day service. He found that seventy eight percent would pay premium prices for weekend availability.

23:42 This is a neat HVAC company. Eighty two percent would pay extra for a guaranteed appointment times, and ninety percent would pay more than twenty four to seven emergency service. And Mike wasn't charging differently for any of those things. He was literally giving away a premium services at standard prices. So he created service tier values. So the tier one was standard service, regular hours, regular response times, the more common stuff. Tier two was priority service so same day, guaranteed times. Tier three was premium service which is weekends and after hours, and Tier four was emergency twenty four to seven immediate response and each had clear pricing and clear benefits. So talk about value. The customer actually saw value in same day service, in weekend service, in twenty four to seven service, and they were willing to pay for it. And those were and he was charging standard for priority service, which is same day judging standard for weekends and after hours. He was charging standard for a urgencies.

25:02 So seventy percent of customers chose a higher tier than basic service. Seventy percent. That seventy percent was paying the standard rate, and his average ticket increased by forty five percent, and customer satisfaction went up because everything was more organized, and not only did the customer appreciate that, but the employees work better when they knew exactly what was going on and how the systems work for same day, for weekends, for and has caused to deliver that by the way, his so his his average ticket increased by forty five percent, Oh deliver it only increased by fifteen and the rest was pure profit because he was already providing any of these services, he just wasn't charging for them. So here's another example. So Linda, who runs a successful cleaning company cleaning service. She was charging the same rate for every house just based on square footage. But when we analyzed her costs, we found huge variations based on the house layout and complexity, the furniture density, the pet presence, the special surface materials, client requirements and travel distance. So she created a matrix that instead of one flat rate, she

26:36 had multiple factors that would affect price based on square footage, based on the layout, based on the furnishings, and the density factor, a pet presence factor, special materials, and travel zone traveling. And was Linda worried about implementing this well, she was pretty worried. She thought clients would revolt against the more complex pricing. But what actually happened is their clients appreciated the transparency. They could see exactly what they were paying for because they you know, they're just getting a standard rate before, but now that they know what they're paying for, you know, if they had a pet, if there was a situation where a pet that you know, that ends up being more work. But she also created a profit profit accelerators, which is optional add on service that had extremely high margin. And where she added these profit accelerators was deep carpet cleaning, treatment, window cleaning, cabinet detailing, appliance, deep cleaning, and garage organization. So these were all additional services that she was able to add on. And when you think about it, a cleaning service that provides window cleaning and then cabinet detailing and carpet treatment. It's pretty valuable.

28:00 And so talk about adding more value. There's there's a great example, chookey of adding more value. Right yet, you know window cleaning. I mean, I mean, I have pumps cleaning here at my house and they won't touch the windows and they certainly don't go into any appliance deep cleaning or carpet treatment or anything like that. So this is really adding more value, absolutely, and I could see her getting more business because of that, just just by virtue of that. And these are additional services that she threw in had profit monduins of seventy to eighty five percent because they require minimal additional time while the crew was already on site. And so let me give you another example the proofs that this works in any industry.

28:57 So there was a landscaper was charging the same hourly rate for everything, mowing, planting, design work, everything. When he analyzed his true costs and value creation, he found he was severely under charging for his highest value services and overcharging for basic ones. And so he implemented a value based pricing matrix. And so instead of one hourly rate, he created different rates based on the skill level that was required, based on the equipment that was needed, based on the season, based on the project complexity, the value being delivered, and time sensitivity. And the result was his revenue increased by forty percent and he doubled his profit because he was finally charging based on value, not on time spent. I think that's that's another area where business owners need to review their pricing is based on value.

30:05 That that that you're bringing, you know, going back to that person that's cleaning service, you know, doing windows, that was that was exceptional value. You know, so it demands a higher price, and customers will pay higher price for in exchange for value. And so so let me show you something a little deeper. So you take the landscaper who implemented value pricing. Well, there's another layer to this story that that really drives his home on how much money most businesses are leaving on the table. So he discovered what he called an expertise arbitrage. And here's exactly what happened. Yeah, like most landscapers, he was charging the same rate as I mentioned, whether his most experienced foreman or his newest employee was actually doing the work. But here's what's fascinating. His customers actually noticed a difference in quality and experience, so he created experienced value tiers. So his master craftsman was this, you know, this level that he had at a level called master Craftsman, and that was for twenty years plus experience. He had a Senior Expert level for ten years plus, and he had a Professional level five years of more, and then a standard level which was an entry level team. So instead of hiding this difference, he highlighted it, and he created detailed

31:39 profiles for each team leader, including years of experience, special certifications, project photos, customer testimonials, and areas of expertise and customer's done specifically requesting the more experienced teams even though they cost more. Yeah, remark. Yeah. And then he used premium pricing from the top tiers to hire and train more skilled workers, creating a self funding improvement cycle. And then there was this auto or pair shop who was leaving massive, massive amounts of money on the table with their diagnostic process. You see, like most shops, they tried to flat diagnostic fee. But when he analyzed their actual cost and value creation, he found huge variations. So he created this value matrix where a basic scan was seventy nine dollars. Then that was like a level one, and that was just a basic diagnostic scan. Then he had a level two, which was a comprehensive diagnosis safety. He didn't realize that he had these additional levels of service. He was charging seventy nine dollars for everything, even a comprehensive service, which was a complete visual inspection, test, drive evaluation, photo documentation, so all this stuff now he's charging one forty nine. He was charging seventy nine. And then he had this level called

33:13 Master Tech Analysis, which included everything in his comprehensive diagnosis, plus a senior Master Tech inspection and component testing, so and then video documentations that it just photos, and it just he just went really deeper, and most of the customers chose level two of three, where he was getting seventy nine dollars all the time for diagnostic no matter what level of service here, most of the customers picked the level two of three where he's getting one hundred and forty nine dollars and two hundred and forty nine dollars. And you know, he wasn't when he marketed it. He wasn't just selling a diagnostic service, he was selling certainty and peace of mind. You know, the profit montions on the higher levels were eighty percent because the additional required time was minimal. And you know, it's not more about charging more, it's about creating and communicating these values in ways your competition hasn't even thought. Every service, every product, every interaction with your customer has a hidden profit potential if you know where to look, and if you think deeper and deeper and deeper that on that service. So when we come back from the ninety second break, we'll talk more about finding hidden profits in your business. Nice Hey, their business owners. Let me ask you something. Are you tied of blending in with your competitors? Frustrated with slow

34:47 growth and slim margins? Well, I've gotten news for you. Everything you've ever learned about growing your business is wrong. Don't worry. I'm here to let you in on a secret weapon. Your position of market dominance. It's what sets you apart, makes you irreplaceable, and has customers lining up at your door. My name is Michael barber Rita from Next Step CFO. I know what you're thinking. Sounds great, Michael, But how do I find my position of market dominance? Well, that's exactly why we've created our game changing implementation program called Next Step to Market Dominance. In just ninety days, we'll guide you step by step to a position of market dominance by uncovering your unique strengths that competitors can't touch, by crafting a message that resonates deeply with your ideal customer, by building a strategy that turns you into the go to expert in your field. Now this is in theory.

35:41 These are battle tests and strategies that have helped businesses like you as double, triple, and quadruple their revenue. Don't let another quarter go by struggling to standout. It's time to dominate your market. Period. Go to NEXTSTEPCFO dot net forward slash contact. Fill out the form and in the message section put the word dominate or call us at seven eight one three two six three A two two. That's next step CFO dot net forward slash Contact or call us at seven eight one three two six three A two two. So welcome back to powerful business strategies. And if you're just joining us, we're talking about finding hidden profits in your business. And now I want to show you something that most business owners usually miss h and it's called problem profit centers. So most business owners see problems as pure cost centers. Since I was talking about earlier two key, but what basically you could take your biggest business headaches and actually let them become profit generators.

36:47 So let me tell you about this guy Tom who runs a successful autover pay shop, and like every shop owner, he had a constant problem customers needing loader cars. All their vehicles were being repaired. It was a huge hassle and expense, and he was spending three grand a month renting cars for customers, seeing it seeing it as a necessary evil. But he implemented what he called the problem to profit conversion system where he and here's what he did. He analyzed how many loader cars he needed monthly, calculated his total rental cost, researched used cop prices along with the associated depreciation, looked at insurance and maintenance cost, and he did something radical. So instead of renting cars, he bought five used cars and he wrapped them with his business branding so that it would be a promotional tool for people were driving around. And he added a QR code linking to special offers in that branding right in the car and he installed tracking device for security, and he also created a formal loaner car program, and so he turned these cars into mobile billboards and lead generations.

38:12 So each card had each car had a professional wrap advertising, special offer displays, the QR codes that I mentioned, service reminder systems. I mean, the results are incredible because after six months he saved eighteen thousand dollars in rental fees, He generated one hundred and twenty seven new customer leads, created a new premium service level, and added a revenue stream from insurance companies. And so it's so he really he took that problem of leasing cars out and turned it into a major profit center by buying the cars.

38:53 And when you added up all the costs, it was worth it because on a monthly basis, whatever loans he had on those on those cars was being covered by the just by not only the rental fees that he was charging forget that, just by the new leads he was generating from all the advertising he had on the cars. And his customer satisfaction scores went up because now he controlled the entire experience from her pair to loader car to follow up. You know, he didn't have to rely on a leasing company. And so another example is Joan who runs this is another residential cleaning service. Her biggest problem was last minute cancelations. She was losing thousands every month from holes in her schedule. So she created this revenue recovery system. And so instead of just accepting cancelations as the cost of doing business, she created a VIP waiting list, implemented a cancelation policy, developed a rapid response team, built a flexible pricing system. And here's how that worked.

40:05 So customers who canceled with less than twenty four hour notice paid fifty percent. That revenue funds a discount for customers who can fill that slot. And then so you get a lower price if you could fill a slot that was vacated by somebody. And then VIP customers got priority access to canceled slots and last minute fills get premium pricing. So the results were really unbelievable. Her revenue from canceled appointments went from zero to over one thousand dollars per month just on canceled appointments. So I was hoping people canceled, but it's what's really powerful. The cancelations dropped by sixty percent because people knew there was a real cost, so they didn't mess around. They actually, you know, they actually came to the appointments more often. Here's one for a contractor. There was a contractor who was spending two thousand dollars a month on dumpster fees for construction waste.

41:09 They had a pretty typical cost that we that contractors say, you know, hu hum, you know this construction waste. But he analyzed his waste stream and he found that forty percent was reusable lumber, reusable lumber, twenty recyclable metal, fifteen percent was clean filter, and twenty percent was actual waste. So he created sorting stations at each job site and he ended up the results were that the lumber was resold or reused, even if it sold scrapped, it was still re used, and the metal was sold to scrappers. The dirt the filled dirret was sold to landscapers, and actual reduce actual waste reduced by eighty percent because only twenty percent was actual waste. And so we turned the two thousand dollars monthly cost into a fifteen hundred dollars monthly profit that took thirty five hundred dollars monthly swing on his bottom line. And this is the power of hidden profits. It's not just about finding new revenue or cutting costs. It's about looking at every aspect of your business and asking how can this make money? Yeah, even customer complaints can become profit centers. One of my clients in the restaurant business was getting complaints about weight times.

42:34 So instead of just seeing this as a problem, he created a text to face weight LISS system that notified customers where the table was ready to offer drink specials while they waited, promoted adveretisers to hungry customers, and gathered phone numbers for marketing. And their bar revenue increased by forty percent and the customer complaints dropped it. I think it was one of two percent. So they turned their biggest problem into a significant profit center. I think it's time for compliments. Brilliant. Yeah, let's get to that compliments. So and Michael, by the way, they might be wanted to linger in questions from business owners, just in what you share there we should touch on. So I absolutely want to make sure we get to those. But let's go through business compliments again. This is a segment that a number of business owners find very inspiring because what we're doing is we are spotlighting business owners coast to coast across multiple industries. So the first business owner that we would like to spotlight for today's Business Complements segment is Kate Green with our Head Solutions. Here's their statement and folks, I think you'll really resonate with this. Our's Head believes every purpose driven brand deserves to stand out and make a last impact. As a design forward communications agency, they specialize in amplifying missions that matter, whether in bioscience,

44:12 conservation or beyond, from crafting unforgettable brands and telling compelling stories to drive pr and build cohesive digital campaigns. They bring everything together with impactful design at the core. If you're ready to make your mission impossible to ignore, learn more at owls headsolutions dot com. Again, that's owls Headsolutions dot com. Second business owner that we would like to spotlight. Find me Manzanera, who is the CEO of Amicus Infinitum, which, again, folks research which the origin of that name is just very very impactful. In fact, you can start that research on his website amicusinfinitem dot com.

45:08 Now Heimi's company. Here's what they do. They find the sellers for your business if you're interested in selling your business. And they do this by consulting with ease stakeholders, which are their investors, as to what businesses they would like to buy and making the case for why they should buy those businesses. And here's their commitment. Their team is ready to earn your business and buy your business. In less than forty four days. Michael, is that incredible? Ah? That is yeah. I mean that's really creative. I'm really creative right.

45:49 The next business owner to spotlight is Yvonne Ribeiro, who's the CEO of ibrand Strategist. In fact, we're going to do a two for one here, so we're a spotlight Evonne, as well as her colleague Pollyanna Pasa and Michael. Here's their headline, dream It, brand it, make it. They help ambitious entrepreneurs bring their unique ideas to life. You can find out more about the team at Ibrandstrategists dot com. And then the last, but not least certainly is Caitlin Harrison who's a financial planner with Northeast Planning Associates.

46:32 Here's her headline, to have no plan is in fact a plan. It's not incredible Michael, Right, no matter what, no matter what season of life that you find yourself in, Caitlin and her team are certainly here to help. She provides her clients with services such as investments management or time and planning, a state planning, as well as insurance need analysis. Find out more at we are your Planners dot com. That's the website, we are your Planners dot Com. With that, Michael, I'll toss it back over. To you, great, Thank you chick. If you don't have any questions. There's one more thing I want to like.

47:16 Yeah, yeah, there's sort of one quick question based on and maybe it just kind of ties together everything, like why do you think business owners are a little bit nervous about how they do pricing analysis? So you've mentioned a few different strategies that involves price and analysis. Where do you think business owners get a little kind of nervous about that? Well, first of all, because they can't justify it in their mind. Okay, that's that's one reasoning. But what they're not picking up on is if they simply add more value to their product or service, they can justify every example that I gave today, there was a reason there was more value that was being delivered. Absolutely in terms of when the price, you know, when the price went up and it was explained. You know, if you don't explain it, I get it. You know, you could get nervous about it. But what happens is is that a lot of business owner has just increased the price. They don't add any value. And the other thing that they do is they get into the wallet of the customer, which is a very dangerous thing because maybe they can't afford it, or they don't think they can afford it, so how can somebody else afford it? You just can't look at it like that. You've got to stay out of the wall of the customer. The customer makes a decision based on value and the problem you solve. That's it.

48:43 So you know, with some of those examples I was giving you, you know, there was real value, like, for example, the company that increased their twenty four hours service, that was value that the customers saw. Now, the customers who didn't see value in that didn't you know, didn't didn't take advantage of it. Great, But the customers that did, we're willing to pay for it because twenty four to seven is pretty good service. Absolutely, But yeah, but lots of business owners they get they get fearful when it comes to increasing prices because they think they're going to lose customers. And most of the time, if they don't add value, I understand the fear. If they're not if they're not adding value to the product or service, great point.

49:33 So that's yeah, that's that's basically, uh, what it is. And so unfortunately that's all the time we have today. So to get a copy of our book, Powerful Business Strategies, simply go to our website www dot next Step cf CFO dot net. That's www dot next step CFO dot net. It's totally complementary and it's until next Monday at noon Eastern time. For Chucky Obio. My name is Michael Barberita. And remember, don't keep doing what your competition is doing. You have been listening to Powerful Business Strategies finding out that everything you ever learned about growing your business is wrong.

50:18 Tune in next week and every week at noon Eastern time on W four CY Radio with your host Michael Barbarita of Next Step CFO and moderator chugy O Bio