The Profit Multiplier: Finding Money Hidden in Plain Sight

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 explicit or. Implies shall be extended to W four CY Radio or it's 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's your host, the resident of NeXTSTEP CFO Michael Barbarita. And joining Michael for today's show as an executive moderator is chooky obia.

1:00 Yes, this is schooking. 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 hey? How you doing, Choky? How is your Christmas? It was nice? It was nice. And look, I've got my notepad and my pen. I'm ready to take some notes today. I feel like it's going to be an energizing show. Excellent, excellent it is. And my name is Michael Baberia, President of Next Step CFO. And next Step CFO is a fractional CFO and strategic implementation firm, and our vision is to ensure that overwhelmed business owners achieve the time, freedom, and consistent profits to build a legacy and the life they desire. Our mission is dedicated the guidance small business owners to leveraging their time, exploding their profits, and building a meaningful legacy. This show powerful Business Strategies that our book of the same name, is a step towards accomplishing that vision and mission. With that, I'd like to hand it back to my co author and moderator for the show, Chicky Olbio.

2:04 Michael, you were kind enough to ask how my Christmas was? How was yours? Oh? Very very good. I only worked four hours. Okay, there you go. Well, look it's interesting that we're, you know, thinking through the holiday season. Today's episode is titled The Profit Multiplier, Finding Money and Hidden Plane Sites. So Michael, look, I'm actually quite excited because I do think I need to find some money. A lot of business owners need to find some money as holiday season, right, so look really quick. Disclaimer, folks, Michael and I were both affiliated with a number of different organizations. I currently serve as a managing director of business development for Veta Price, a global business focused law firm.

2:47 In addition to that, it's truly an honor to collaborate with Michael to moderate business roundtables and document the insights from those roundtables as part of our book Powerful Business Strategies. But please know that the views expressed on this show are personal views based on successful experiences, and my mission as a fearless moderator is just to ask the right questions, take some notes, help you and me learn the best strategies that the competition isn't doing. Michael, back over to you. Thank you, Chicky and Chicky. Last week I announced a little different kind of a program that business owners can do.

3:27 If they have a business problem that they'd like us to answer, or a business question or a strategy that they'd like to ask about. They could email us. They could email us at ask at NEXTSTEPCFO dot net. That's ask ask at next STEPSDFO dot net. And it doesn't matter what the business problem is or the question, and we will answer it for you. There are a couple of things that we ask. Number one, please state whether it is something we can answer on the air or if it is confidential, and of course if it's confidential, we won't answer it on the air. And number two, please provide your phone number because business problems can be complex and we might need more context or clarity. And if you're one that doesn't want us to answer the question on the air, we need to call you and give you the answer. And that email address, once again is ask at NEXTSTEPCFO dot net. And so as a little opening for today's show, I like to open. I like opening with a little inspiration. So what amazes me is that every day I watch business owners walk into their stores, open their laptops, or head to their job sites not just to make money, but to make a difference.

4:43 And while others play it safe with steady paychecks, business owners chose to bet on themselves. And for the business owners out there, you are the ones creating jobs in your community. You're the ones lying awake at night figuring out how to make payroll, the ones missing family events to serve your customers. And you're the ones who keep pushing forward even when it feels like everything's pushing back. And I see you working early mornings before your team arrives and late nights after they're all gone home, and I see you solving problems nobody else wants to tackle. I see you putting houses on the line to fund your dreams. You're not just business owners, your dream builders, your job creators, your community leaders. And even though it often feels lonely at the top, know this, what you do matters. Yes, your courage to keep going inspires others to do the same. So to every business owner out there making it happen every day, I see you, I respect you, and I applaud your relentless spirit to build something meaningful. So, Chokie, today we're going to explore why everything you've ever learned about profitability is wrong. And you know, just, yes, just yesterday, actually the Friday, I was working with a business owner who told me, Michael, sales are up, but our profits are down. How was that possibly asked, Well, this happens more than you might think. Business owners focused

6:18 so much on the top line that they missed profit opportunities right under their nose. And think about it. Most businesses look at their p and L monthly or quarterly, check their sales and maybe their bottom line maybe and think they got it all handled. But that's like trying to drive a car by looking in the rearview mirror. So today I'm going to show you exactly how to find hidden profits in your business. I'll show you how one business discovered they were actually losing money on their biggest customer and I was fixing this one issue double their bottom line even better. Their customer thanked them for making this change. And they're also going to reveal what I call the profit multiplier system, and it's a systematic way to uncover and capture hidden profits in your business.

7:06 And the part, the best part is you could start finding these profits this week without needing to make a single new sale. So stay tuned as we break this down. And if you're driving, don't worry. You could catch the episode again on our podcast at Powerful Business Strategies dot com. So let's dive into the first major area, where hidden profits exist, and I call it revenue leaks. And these are places where money is flowing out of your business without you even realizing it. And let me share three examples that will show you exactly how this works. And first there's a manufacturing company was consistently showing gross margins of thirty five percent, but when they did a deeper dive into their pricing model, they discovered that forty percent of their orders were actually losing money. And here's what happened.

8:04 They had this standard pricing model that worked great for all the orders over ten thousand dollars, but for smaller orders, they discovered that the setup costs were higher. They they discovered that the material waste costs were higher, that the labor costs were disproportionately unfavorable, that shipping costs weren't fully covered. Admin costs ate up a lot of their margins for those smaller orders, and rush orders weren't properly priced. And so by implementing a new tiered pricing system, they introduced minimum order requirements to the minimum orders set up. The setup fees were for small they set up and they had set up fees for small orders, where previously they did not. They had rush order premium, so if you wanted it fast, you had to pay a little extra.

9:03 They had volume discounts that were structured properly, shipping cost adjustments, and administrative fee allocations. Their bottom line increased three hundred grand in the first year. They didn't lose any customers, and in fact, many small customers started bundling orders together to meet those minimums and actually making them more profitable to service. But here's the key. You know, if you're hearing this, you're saying, yeah, sure, they didn't good any customers, not at all. Well, here's why they had that. They they didn't sell on price, they sold on value. They had a strong position of market dominance, and they were able and because of that, their customers didn't want to leave.

9:49 They had solutions to their customers' problems that nobody else tackled, or if they did, if they did tackle it, they weren't telling anybody. So that's a lot of the situations that I'm going to talk about this today have everything to do with the reason why some of these price increases work so well, or some of these strategies like setting up fees for small orders and rush order premiums. The reason why it works so well is that these businesses sold on value. They didn't sell on price. No one was going to leave. No one was going to leave chocky. They're just not going to leave, you know, because the value was there. So another example is a professional services firm was billing hourly rates of two hundred dollars, thinking that they were making good money. But when they analyzed their true costs, they found out they had unbuilt client communications. Wow and yeah, and that can happen, you know, you just don't put it through the buildings. You have a fifteen to twenty thirty minute conversation with somebody and you don't put it through the billing system. Boom, it gets unbuilt. And there was They discovered that the proposal preparation time was a cost that they didn't consider. They also discovered that internal meetings and planning for each for

11:21 certain clients weren't considered in the in the hourly rate, research and preparation for clients wasn't considered, which is really it's time. And so they were actually making less than one hundred dollars an hour. And then what they did is they implemented retainer based billing and project based pricing versus hourly and that they had different service packages so that their clients could have options, which is always a good idea. We've been talking about that on several of our shows regarding that tiered pricing, that bundling, bundling together services to give to give clients options. That's a real that.

12:11 So we've been talking about that a lot. And that's what they did, and their revenue went up, but but more importantly, their profit doubled because they stopped leaking time and money. And the third example is a distribution company discovered that their biggest customer was actually their least profitable. This happens a lot, and here's what they found. They found that the special packaging requirements that that this big customer had was costing them more money. They discovered that the the delivery schedules that this that this big customer had was throwing off all the deliveries, stowing way out of whack and costing more money. They actually had access of return rates with this big customer that they didn't consider pricing in UH. They had payment terms that were too long for this customer that they didn't consider pricing in UH. They had storage costs UH not covered that were more that there was storage they as a special service.

13:19 They stored additional inventory for this for this customer, and well it costs more. And so after realizing all this, they they started having packaging searcharges. They the delivery schedules were priced properly based on the rushing of the order. UH. Their return they had a return policy with fees. UH. They had payment term adjustments for that long term dating that that they were giving the customer, and they had storage fees for any of that long term UH storage that the customer requested. And once again, you know other people people might say, well that customer, you know, that customer probably left. They didn't, and they didn't because the company added so much value UH to the service that they offered that it was a it was a no brainer for that company to stay. And by making these adjustments UH, the UH distribution company increased profits by two hundred thousand while maintaining the relationship. And so here's how to find these revenue leaks in your business. Well, the first thing is you have to do a true cost analysis.

14:34 You have to break down every cost component including all the time spent. You have to factor. In an overhead allocation, you have to consider opportunity costs. You have to account for risk factors. There are risk factors that don't happen every time, but could happen or happen occasionally, and you have to build that into the cost. And then you have to calculate the real margin. What is that real mar margin? What is what is the margin that you're actually making on that big customer, on that small customer. UH. Then you have to do a customer profitability analysis where you do UH you understand what the revenue is for the customer a per customer, the cost of service service each customer, any payment patterns that they might have, So certain customers take longer to pay. It doesn't mean you're gonna drop them like a hot potato. It just means that you're gonna You're gonna you have to build into that pricing. UH. Return rates they differ per customer, and the administrative burden differs depending upon who the customer is.

15:42 So in addition to a cost an overall cost analysis, you have to look at each customer at least at least the top at least the top ten. You might not have to go real deep but you have to do you have to do the top ten, and then you have to do some small customers because you have to make sure that you're not getting burnt on anything that they're doing. And then you should have a product a product service line analysis by understanding the individual product margins, what does this product generate for gross profit versus another product, The setup and handling costs for each product that needs to be reviewed, the storage and carrying costs for each product needs to be reviewed, the support that needs to be reviewed for each product. So you've got your your true cost analysis, You've got your profitability analysis by customer, and then you have your profitability analysis by product line.

16:49 And then you have to review your overall pricing structure for volume versus margin analysis, for minimum order requirements, for rush order policies and payment terms. And the key here is understanding that revenue doesn't necessarily equal profit. You have to understand what your product or service really costs. And you know, I had a client early on, it was back in nine or ten, and you know, they were really pleased with all of their pricing structures and so forth, and come to find and it's probably because customers were buying without complaining about price. Come to find out they were selling their product below cost. Yeah, you know when we did this type of an analysis, boy, I mean, and this company was losing two hundred and fifty thousand dollars a year and wondering why onlige on higher sales volumes. Well, the higher sales volumes were driven by the fact that there were priced really low because they were giving it away.

18:00 So if you're not getting at least one third of your estimates or one third of your posals or offers, if you're not getting a no based on price for one third of your offers or proposals or estimates, then you are probably priced too low. Remarkablely get twenty percent or fifteen percent. This company was getting zero percent. And obviously, you know, we could figure out quickly why everybody was jumping on there on the price. And so that company, in addition to increasing their prices, how to add more value to the product. Because once again it's it's it's you want to compete based on value and not on price.

18:47 So let me give you a simple way to start finding these leaks. So take your last ten orders or projects, doesn't matter if they're big or small, and ask did we make money? How much did we really make? What costs did we miss, what time didn't we build, what extras did we throw in? And would we do it again in that on that price? And most businesses will find that at least three of those ten were unprofitable. And that's your starting point for plugging revenue leaks, Jocky, Are there any questions? Yes, it's remarkable, Michael, and I think you really struck a chord with a number of these insights. So let's let's consolidate a couple of questions here into one. So, Michael, you mentioned revenue leaks in businesses. What's the most common revenue leak that you see? And what can business owners identify these kinds of leaks in their operations?

19:49 Okay, great question. You know. The biggest revenue leak I see is is just misunderstanding what the true costs of small orders or projects Areusiness owners are all focused on those big projects making sure A they get out the door and B you know that that customer is happy that they lose sight of the smaller orders, which can represent anywhere between thirty and sixty or seventy percent of their revenue and they don't know what those products cost. Businesses often think they're making money on every sale, but they're not factoring things like the setup time, the administrative cost, the overhead allocation. And the fastest way to find this leak is to analyze your last ten orders as I as I mentioned right at the end of that segment and breaking down every cost including time spent, materials, overhead and administrative costs and what most most business most businesses discovered that at least thirty percent of their orders are actually losing money. And so if you go through that list that I just went went over, you'll be able to identify where the leaks are.

21:02 It's really interesting, right, Michael, And I imagine that checklist would be applicable across multiple industries. Correct, that's absolutely true. Yes, great, So, as you know, we have an audience of business owners and executives that listen to US coast to coast, representing multiple industries. Here's another question. Now, you talked about a manufacturing company implementing a tiered pricing system. Right now for businesses though that are a little bit concerned, a little bit nervous, Michael, about losing customers with these sort of price changes. What do you recommend rolling out this kind of an initiative. Well, we come back to value again. You know, you're stop by segment segmenting your customers. You analyze profitability per customer, identify which ones are actually costing you money, and then create those pricing tiers that protect your profits while giving customers choices because customers want options, but they the key is to communicate the changes as adding value, not just raising prices. Too many times those little letters go out to customers that say, we because of the increased cost of this of this material, or because of the increased cost of labor, or because of the increase or because like right now it's popular to say because inflation is hitting all of us. Yeah, you know, but really what the communication should be is we're you know, we are having a price increase, but it's because we're adding this

22:33 value to the product or service. That way you'll you'll maintain you'll retain a large percentage of your customers. That manufacturing company actually retained ninety five percent of their customers because they offer options and they communicated the price increase with value add not justiflaming it on the inflation that we're all experiencing exactly. Yes, so that important really taking ship K. Thank you, and so before I continued this discussion, we're going to take a ninety second break. Hey, their 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. Don't worry.

23:27 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, 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 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 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 STEPCFO dot net forward slash contact or call us at seven eight one three two six three A two two.

24:49 Welcome back. And you know the second major area for hidden profits is what I call cost structure transformation. And this isn't just about it's about restructuring them to protect and enhance your profits. So I'm going to be giving you some examples here, and there's really some creative ways that costs have been reduced, and probably about half of them I've had some personal experience with the others, I've just recognized other businesses doing it. So let me share an example in the construction for a construction company that transformed their entire cost structure. They had the traditional costs, they had office space, they had a full time staff, they had equipment leases, they had a fleet of vehicles, they had software licenses, insurance, the whole smash. And when business was good, these costs were very manageable. But during slow periods they ate away profits. And here's what they did.

25:55 So with the equipment, they sold their own whipment and they created equipment and equipment sharing network. This is very creative. I was involved in one of these and it was really incredibly effective. And what it did, in my experience, is it not only saved equipment costs, but it also allowed a company my client, to be in a different product segment. And it was so back. It was the insallation business. Once again, they couldn't offer home insallation because they could didn't have the money to buy the equipment, So they created an equipment sharing network. And what this construction company did is that created a network with five other local contractors who had complementary work schedules. And when Company A had a back ho sitting idle Monday through Wednesday, Company B used it for their project. And when Company b cement mixer wasn't being used Thursday and Friday, Company A prod uce it and so they created a scheduling system and a profit sharing agreement where who owned the equipment gets seventy percent of the rental fee, the company that dealt with the scheduling of all this equipment got thirty percent. All the maintenance costs were shared proportionally to usage, and then the insurance and liability insurance was once again

27:29 proportionally to usage. It was clearly defined. And through this they also, you know, a couple of the companies created rental equipment rental income. It was and then with the experience that I was in, not only did it create a great opportunity, it was a win win for both sides, but like I said, it put that insulation company into the foam insulation business, which is a pretty substantial ended up being like thirty or forty percent of their total revenue once they got into full swing and did this equipment sharing. So there were tremendous opportunities with equipment sharing.

28:18 Another thing that a couple of companies have done, and I've been involved in this as well to a degree where they actually implemented what they called usage based rental, So instead of leasing a crane for ten thousand a month, regardless of how often they use it. They actually negotiated a special deal where they were only paying when the equipment was actually operating, and they had a four hour minimum. They did, but if they used the equipment for four hours or more, it was never a wasted cost. And all of this transformed a fixed one hundred and twenty thousand dollars annual fixed cost into a variable cost of forty five thousand because they only paid when generating revenue from the equipment. So that for the companies that are in the trades, if you can look to make these arrangements, they are incredibly valuable. And like I said, also keep in mind, if there's a segment of your business that you're not taking advantage of because you can't afford equipment, you can find companies. They might not even be in the same industry. They probably aren't, but you can find companies to share equipment with. And like I said, I've been involved in one of those and it was just it was just incredibly valuable and incredibly profitable. And then

29:51 you have to look at the staffing structure when you're looking at this cost transformation that I'm talking about. So uh, the uh the construction company at their core team, uh, the essential project manages, the estimators, the key supervisors. But then they had a specialized contract in network where they built relationships with reliable contractors to do specialized work. Some companies in this construction industry have contractors subcontractors for everything and chooky, remember a co Yes, this is the opha outsource. Interesting, that's what this and that's what this uh, this company did uh and they actually outsourced everything including the framing, and it was it was really productive because they were having people they were actually having trouble hiring people in this skilled area. Uh. They had their project managers in place, they had their estimators and there you know call leads, some people call a step down from project management a lead on the job. And it worked out incredibly well.

31:12 And you know, they didn't have to worry about all of the various different parts of the of a job. They had specialists in everything because they outsourced it. And then to worry about scrambling finding people or they didn't have to worry about the skill set because they hired you know, these outsourced companies that did this stuff for a living. So and then here's another one that this one's much more difficult. It's called project based hiring, and what this construction company did they were able to hire additional labor only when projects requirement required it. Now, this is definitely more difficult than outsourcing due to the availability of workers. But if you actually look for these type of temporary workers when you don't need them, you'll have them when you do because they're temporary and they work on flexible hours. They also had skilled sharing agreements with other companies where they shared skilled workers including admin workers, bookkeepers and so forth were shared, which was interesting. They actually had cross training programs where they would they take those core members and they would train them in different areas in case they couldn't get help, interesting as well.

32:38 And then they had a facility cost strategy where they downsized their main office, reducing their fixed office space by sixty percent. They created satellite like locations, which was small job site offices instead of one large facility. That was helpful. They used they had storage optimization where they can solidated this storage and implemented just in time delivery. Yeah, that was great. And they had mobile office solutions where they equipped teams with technology for remote work and so they they really they converted most of their costs into variable costs, which is exactly what you want to do and from a fixed cost and it allowed for better matching of revenue and expenses. And overall their fixed costs dropped by forty percent, which was incredible, And so there were Another example was a marketing agency that transformed their cost structure because before they were using full time special marketing agents and specialists. They had a long term office lease, they had fixed software costs for all the software that they needed to do the marketing for clients. They had standard benefits all fixed. They had you know a bunch of general fixed overhead as well. But afterwards they transformed the

34:12 marketing agency by number one core team what they called core team plus network, so they kept only their essential roles in house. Very similar to the construction company. They actually built a network of pre vetted freelancers. Once again that opa outsource. They built a network of pre vetted freelancers, so they did their work beforehand. As I mentioned earlier, you do you the work when you don't. You find these people when you don't need them. And because they're freelancers, they're able to basically for the most part, react on demand and they actually ended up saving forty on their payroll.

34:58 Then they had the marketing company also had a virtual first approach where they eliminated permanent office staff and everybody virtually. That worked very well. Uh. They invested in all these collaboration tools so that the communication would stay, you know, like slack. Uh. They set up cloud based file management to store the files, you know, shared files. They reduced overhead by sixty five percent as a result of that. And they also had flexible benefits where they offered benefits benefits allowance instead of fixed packages. So they let employees choose their benefit mix. And then they provided health insurance stipends, which is some companies now uh get insurance that doesn't have it deductible. And what they do is because they have a young staff, and if they have a young staff that that that's pretty healthy, they choose a deductible that they pay the employee through a health benefit system.

36:10 They pay the employee that deductible and so that no deductible insurance comes through at a nice low rate, and then they pay the deductibles. And what ended up happening is that only half the people use their full deductible. So what ended up happening is overall, they saved on insurance because the deductibles were not a big deal. They had a relatively healthy crew or young crew, I should say relatively healthy but young, and so a lot of the people didn't go through the deductibles and they didn't have to ask for them. They ended up producing their benefit costs by thirty percent as a result of that.

36:53 Then they had their variable costs, of course, were tied directly to revenue generation activities, and they implemented profit sharing, which was a variable cost based on profit versus fixed bonuses. A lot of people recently have given Christmas bonuses and those types of things which people come to expect. But when you have a profit sharing bonus, that that bonus is variable based on profit. And so this company, the marketing company, their profit markets increased from to fifteen to thirty five percent, while employee satisfaction improved because of that increased flexibility. And so here's how you really analyze your cost structures first, and this is what I'm going to go through here is quite lengthy, but so I'm going to shorten it with just talking about a couple of costs in each category. So number one is your fixed cost analysis. You have to look at your rent and mortgage payments, your permanent staffing salaries, your equipment leases, and your software licenses, your utility bills. Then you have to understand what your utilization rates are. This is equipment usage hours versus total hours, staff billing hours versus total hours, facility space storage usage versus total space usage. And then you have to identify peak and slow periods. Keep that

38:24 in mind. You have to map resource allocation. You have to track capacity usage. You have to measure efficiency. You have to do a lease in buy analysis to make sure that the equipment that comes in is most efficient, whether it's leased or whether it's bought. You have to review your staff structure and see what opportunities you could get flexible. You know those remote those subcontractors and those outsourced companies or outsourced businesses that can come at a moment's notice. And then you have a technology assessment, a facility evaluation, equipment usage study, and a partnership potential like that shared equipment network partnership. So the key is moving from a fix to a variable cost structure whenever possible, but doing it strategically to maintain quality and reliability took me any questions from the audience.

39:27 Absolutely, So it's really interesting, right, Michael, I mean just this point about fixed costs and variable costs. So let's get into it. When transforming fixed costs to variable costs, what's the first step of business owners should take. Well, start's with that full audit of all the fixed costs and the utilization rates that little list that I just went down. But really, if they started with just the fixed costs, they're going to be way ahead of the game. Because if you're paying five thousand monthly for equipment but you're only using it forty percent of the time, that's your first opportunity. You map out the exact use usage patterns of all of your assets, and this gives you the data to negotiate better terms with vendors on those assets. Consider that equipment sharing strategy that I mentioned earlier, or usage based pricing that I mentioned earlier, where the company that had that ten thousand dollars a month lease converted it to usage based and saved like thirty or forty percent, And so yeah, you could. So's there's a lot of options if you really can focus on it.

40:38 There's a lot of ways to save and cut those costs. Michael. As you know a lot of small business owners, they get a little nervous where we talk numbers, right, I mean it's sure they do. Yeah, what you've just shared this piece of insight. That first step usually is the most difficult steps. So the fact that you've given them some insight and just taken that first step really important. Another related question on this a slightly different topics something that you mentioned earlier. So when you mentioned. Contractor partnerships as a way to reduce fixed costs, structure these partnerships, especially for quality and reliability. Michael, Well, you know, the key is is formal agreements with absolutely clear terms, not handshakes that that that that doesn't work. What happens is the handshake deals get get muddled.

41:30 So start by identifying complementary businesses where you can share resources and create written agreements. That's what we had when we when we did it and when I was helping my client. That specify the revenue sharing because there's all kinds of revenue sharing with the rental income and so forth, the quality standards that each wants and needs from that equipment, the response times any dispute resolution, and figure out how those will be handled, at least the ones that you can anticipate you're building performance metrics and regular reviews. One construction company created a network of those five partners, reducing those fixed hosts by forty percent while increasing capacity by sixty percent. So there's there's all types of opportunity there.

42:23 And thank you for that, Chooky. And So before I continue this discussion, we're going to take a ninety second break. Hey, their business owners, let me ask you something. Are you tied of blending in with your competitors? Frustrated with slow growth and slim margins. I've got 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 Barbarita from step CFO. I know what you're thinking. Sounds great, Michael, 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 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.

43:46 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 eighty one three two six three eight two two. That's NeXTSTEP CFO dot net forward slash contact or call us at seven eight one three two six three eight two two. Well, welcome back, and you know time flies when you're having fun, So Jickie, if you could go, we are running a short of time today, so if you could go over compliments, then send it back to me and i'll I'll close with a quick tap. This is a business complements segments and we have four business owners that we would like to complement and really spotlight today. These are business owners that are coast to coast in their operations. So the first is Alan McGriff.

44:37 He's the owner of H and H Fencing and Landscape Solutions. They're based in Colorado and Michael get this. This company is a go to resource for fence construction, fence repair, or any custom jobs. And as a veteran founded company, they operate with strong values aimed at understanding and truly so in clients and it's just really interesting. They approach their projects like the opportunity to build a long term relationship. So you can check out a little bit more about H and H Fencing at H andhdash fencing dot com. The next business owner is Bill Doval and he is with PROEFT Center based on Idaho and just really remarkable Michael.

45:25 Bill is a master practitioner of EFT, which is Emotional freedom technique and he's got a background in registered nursing. And here's a part of Bill's mission statement. It's also really a service commitment to empower people to update their internal software so they can have the thoughts, emotions, reactions and body sensations that they want. Wow, you can really find out a little bit more about Bill's perspectives on his web side proeftcenter dot com. The next business owners Justia Olma. She is the founder of Scribe Syndicates and she serves business owners and marketing professionals really nationwide. And Michael, you might sort of be inspired by this. So they effectively write copy right, So they write marketing copy that aligns with a company's mission, goals and target audiences. In fact, also part of a company's profit strategy plan. They would write some marketing copy for that, and they incorporate really important keywords and key terms and phrases to really connect with clients. You can learn more about Jessica Olma on her LinkedIn profile. And then the last business owner of Spotlight is Annie Young. Annie is with Sawabona Ranch and they serve people really across the country and world. She is an equine assisted mental health practitioner, certified and licensed.

46:55 And here's her mission statement, Michael, to help parents rediscover their passions, to heal their pain from the past, to embrace their strength, and to see their gifts come to life. Excellent. And here's a headline where healing happens. So find out more at Sabona ranch dot com. Michael back over to you. Excellent, Thank you Chokey for that. It was a great complimence today. So in closing, let me give you the exact steps to implement the profit multiplier system in your business. So number one revenue leak detection. So you analyze your true costs, which is the first step. Review pricing structure, structure, preview pricing structure, evaluate customer profitability, assess service costs, monitor value delivery, and then track profit patterns. The next step in the profit multiplier system is the cost structure transformation.

47:57 So you map out the fixed costs, You identify your variable options, your plan transitions, you build partnerships, keep that always keep that in mind, create systems and measure results. And then the third is value capture optimization. This is where you audit your current value, what type of value you're providing your package services. Remember we call it talk about often that tiered pricing and packaging and bundling your price strategically. By giving the customer options, you implement systems, you train your team, and you monitor results. You know, if you start with just one area this week, look for one revenue leak that you can plug one cost you can transform well, one value point you're not capturing, you'll be doing. You'll not only have a successful week, but you'll have the start of a very successful business because remember, you don't necessarily need new customers and new products to increase profits. You just need to better manage the money already flowing through your business. And to get a copy of the book Powerful Business Strategies, simply go to our website www dot NEXTSTEPCFO dot net. It's totally complementary and until next Monday at noon Eastern time. But Chucky Obio, my name is Michael Barberita, and remember, don't keep doing what your competition is doing.

49:32 You have been listening to Powerful Business Strategies finding out that everything you ever learned about growing your business is wrong. 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 Obio