#287 // The Lounge “How To Make More Money Per Month” ft Cam + Crowe

Welcome to this Barkey Coach podcast. This platform was built by Sparky's force Barkeys. We simply exist to make business owners more profitable, business is more profitable and more predictable. So we want to work with people that work hard because we love working hard too, that works smart because you've got to be on top of the business. People that are kind because no one likes a dickhead. And all right, people who want results because that's what we're here for. And people who want to be part of a like-minded community. So if you're interested in hearing more about the platform, please reach out and enjoy the podcast. Sparky Coach lounge pod, Cameron Crowe back at ya. What's up? The A team? What was that? Yeah, please. He's self-appointed. Self-appointed. Self-appointed. So this is my business. It's a problem with the dangers. Yeah, I actually fix my mother-in-law's fairytaleites this morning with a pair of ungodly needle nose pliers. She must have sourced these things from the depth of the Titanic. They were so discolored and so rusty. And I'm just like, I'm still going to work my magic. Anyway, I fixed them. Good job, me. Talking today about ways to make money in a month. This is almost a follow up on ways. Make money in a job that I did a solo pot on recently. Maybe it's come out, maybe it hasn't, whatever. It's coming out soon. So, ways to make money in a month, it's so interesting because on a job, you sort of got your job in day, I think, the major metrics. So per job, you're looking at, there's ways to make money. There's a front cost that I quoted well, handling, how did I go? That I capture the variations. Did we handle it well on site? And then you've got the back costing where you reference those first two. Did I quoted correctly? Did I handle it well? And then you've got the change component. So your front cost, your handle, your back cost, and then your change. Do I need to keep doing what I'm doing here? Keep quoting how I'm quoting. Do I need to change something? That's a very important metric. And then you're looking at your day as a whole. Maybe your job made money. Maybe your day didn't. Maybe you had multiple profitable jobs that week. Maybe your week didn't make sense because you finished early Friday. Late on Thursday and you had a big gap when you didn't schedule something on the Wednesday and midday. And there's multiple reasons why your job can go well and your day cannot go good. Maybe you only had three jobs. So you needed four or five. Maybe you had four jobs in your six. There's so many rhymes and reasons there. And that's why you got to look at the job. Yes. And the day yes. And so it's interesting because everyone wants, if you look left to right at your close a month, you've got your revenue component. You got your cost of goods sold, which is billable, labor, material, subcontractors. Basically, anything billable on the job. Then you've got that leaves you with a gross profit. So you got your revenue less cost of goods sold leaves you with the gross profit. After gross profit, you've got other revenue. And that's an interesting metric. Was there a apprentice grant to take into consideration? Did we sell a van? Did we achieve money from another avenue? You've got your cost of operations after that, which is your non billable labor, aka admin, aka in house bookkeepers, aka operations managers, estimators, all that kind of stuff. You've got your non billable people and you're operating expenses, combining as one in that metric. So left to right, you've got your revenue on your file, left, and your cost of goods sold leaves with gross profit. Then your cost of operations, which is all your non billable components, leave you with your net profit. Now, if I asked anyone what they want, what do you want more of in your business? And you're going to say more net profit. I want more. I want more asbestos, more asbestos to paraphrase the Simpsons. I want more. I want more net profit. I want to be left over with more because there's the turnover and then there's the left over. And we all want to be left over with more. That's the probably big thing. How do I do the same thing but we left with more money? So when we close a month, the interesting thing and why I referenced the jobs at the start, the interesting thing is what makes up your revenue component? It was just an incredibly important metric, but why itself means absolutely nothing. If your revenue is a million dollars a month and you're spending a million dollars a month, then you're left with zero. And anyone can do that. Really? If your revenue is a million dollars a month and you're left with negative, that's bad. Don't do that again. If your revenue is a million and you're left with a 20% net, you're pretty thankful at that point, I would say. So there's the turnover and then there's the left over. The left over gives the turnover context and whether you're a student for a 20 to 35% net profit, that's after we put you as a market wage in the cost of goods sold. So what could you walk three doors down and get 120 grand plus super 150 grand 100 grand? If you're on the tools, probably 100 to 120. If you're in the office, 120 to 150 plus super. So you should be including yourself as a market wage in the cost of goods sold or if you're in the office in the operating expenses, very important to get those metrics correct and separated accordingly. So you want to be left with 20 to 35%. And obviously the higher the revenue, the more you should be left with. And 20% of a higher number is a higher number. So but it's interesting thing. What is the revenue? It's all the jobs that perform that month. It's all the progress claims. It's the little jobs. It's a medium sized jobs. It's all the stuff that went on to it's the money that came in that month. So so when we start left to right on on a closer month, the first component you look at is is the revenue. And most of us want more net profit and more net profit, a huge common ground where you'd people would drop money. Is they're not quoting properly? They're not handling properly and they're not getting their hours in. That's going to show in your revenue. So so if I if I said to you, what do you want more profit? I'm like cool, what do you need to do that? You need to measure every single job because that dictates what revenue comes in. Like so it's so interesting to reference because people want more net profit, but they don't want to do what's required to get that, which is measure every single job and day for profit. And and it's crazy to me to think that that there's a disconnection between what you want and what you need to do. What do I want a six pack? Okay, well, you got to get to the gym. You got to eat less, eat, eat better or eat less or both. And and you got to be consistent with with what you're doing all over time. And it's a there's this seed time and harvest. There's cause and effect in all in all your life and your personal life and your business life. There's there's if I want that, I need to sow this seed. And most of us or all of us want more net profit or a better margin. But we're not doing what's required to get that or we're doing what's required for a season and then we're falling off the tracks falling off the wagon. And it's not good enough. We need to consistently execute the checking of every single job, every single day, every single week, every single month because that's where the net profit is. Well, that's where it's leaking out. That's where it's going. That's where it's found. So that's so interesting. But left to right start with revenue, but yeah, where's your head at? So I mean, I like that opening. It was it was a monologue almost. I think it was very impressed. We want more of something that we don't know how to get to is not the answer you're looking for. It's like, we want more of something. We need to know how we get there. Quite simply, we've got to look at measuring the job. So if we're looking at left to right sense, rev, revenue, cogs, get a GP, got other revenue, then you got your cost of operations, which leaves you with a nice little netty profit at the end of the day that you can do whatever the hell you want with. It doesn't bother me one bit. However, often the underlying issue is like, where do I begin to fix my problem? I'm not the net profit isn't where I want it to be and I need to do something about it. Where do I begin? Now this is really, really interesting because we have a look at it and come across a defer bit is that I'm going to say that by doing one thing can also uncover a couple of other issues underlying. Now those often those underlying issues can't be discovered until the sort of base principle is identify, I guess, action so to speak and at its core, I'm going to turn back to it and have a look at it is we're going to measure every day. So we've got to measure the job. So what do we get at measuring a job? We get a couple of things out of it, which is super important is we get an understanding of was that job profitable or not in a microchasm? So the amount of money we charge for that job, so the income received or the revenue that we receive for that versus the cost associated with it. So the labor, the time spent on the job and then the material spent on the spent, a material cost spent on the job gives us again in a microchasm gives us a GP for that job and then also net profit. So how are we performing individually on that little job? How do you build a cake? You've got a cake with layers of cake. So if you layer your individual jobs on top of each other, how do they stack up? That's what you get at the end of the month. So if you're stacking up good mediocre and poor, you're going to get a bit of a mixed bag result, right? And depending on what those stacks, how high they go, that's where our outcome is going to be at the end of the month. So we're looking at where the cost of sitting and where the label is sitting on it all. Now, the key things that come out of this, what I generally find around out of it is the performance of that individual job. So did we perform where it needed to be? The influences on this is if it's a quoted job, is did we allow enough time and did we allow enough material? Really simplistically, it's either a yes or no. Now, I'm going to say very, very rarely, do we see that not enough material was allowed? More often than not, the material is a tick. Where it comes unstuck is that we think we are Superman and we quoted the job for me, the best electrician within the postcode of 4215 on the Gold Coast, shout out, or my brotherhood on the Gold Coast. I'm the best to do this, right? I can do this. Little do we know, did we take into consideration that we spent an hour on site looking at the job? We marked up and sketched up a little bit of a plan of it. We then went through and quoted the job and then we handed it to Robbo and it's like, Robbo time staff now. Go for it, right? So Robbo's got to get that two or three hours of knowledge that you've consumed over a period of time, into his hot little head that then transfers through the neuropath ways into his screwdriver spinning and plier wielding hands to execute that job at a time frame. So what you've learned from that is that the labour causes most of the problem a lot of the time. And I think that's fair to say, would you agree, Crowley? The labour is always the bit that gets people unstuck. Majority of the time? Yeah, it's so interesting, because electrical, you'd moving roughly paraphrasing 70, 30, 70% labour, 30% materials. We're aircon on the soil or the opposite ways. And a lot of time, a lot of time, a large materials move can, a good, 20% of a high number is a higher number. So if you're using 10 grand a day and in solar or aircon and you make 20%, then that reverse engine, you know, over those eight hours, it's going to be hyper-profitable, net-profit per hour metric, as opposed to electrical. So a lot of times a large materials move can mask a poor labour move. So a labour? So I actually, I love that as Sparky Coach, we're moving away from, you know, what is my hourly rate? Which is a great question to ask on its own right. But moving into, what is the job's net profit on that? And how could I have gone a little bit better at that? Because you can make money from a couple of ways, labour, labour rate, reducing across operations. You can make money from subcontractors or subcontracting. And you can make money from materials. There's multiple ways to skin the cow. You rent out your plant equipment for the day. So as long as the job is balancing out, which you need to know, it's okay, but yeah, labour is normally the biggest blowout is labour and your consideration of labour at the start of life. I'll smash that out in a day. And then you've quoted it in the middle of the day. So that day's lost four billable hours. You've gone there instead of going there with a trade-ion, you've gone there with a trade-ion tool apprentices and a dog. And the dog's got billable hours. It's like, I haven't handled how I quoted it. It hasn't gone how I thought. All that apprentice was meant to go with that trade-ion. That trade-ion was sick. So I brought them along for the ride along. All the sudden it's the road traders philosophy. "Ah, see you watching me, watching you." And now no one's making money. Everyone's watching. No one's making money. And as you're watching, and this is the context of a job, you've got the front cost, the handling and the back cost. Most people spend their time front costing and quoting and doing. And there's no reference. So I was like, what do you mean? I quoted that job. That was too enough. I quoted that well. And I was like, you didn't measure it. You cooked the handling of that whole thing. You made a mistake. You didn't check. You didn't test. You carried the wrong team there. And you carried the wrong information there. You can't just spend your time in the first two. You've got to be back costing and checking. You need the holistic picture. So yeah, that labor is intense. And the biggest problem you see with a revenue metric, standalone, is that what if you, doesn't mean anything. Like what if you have a progress claim for a project early on, you have a deposit for a switchboard, you have a purchase, you know, the sale of a switchboard at cost price. Like what does a revenue component make up of? It's just the money coming in. Like one month will tell you nothing. And 12 months will probably tell you everything. And so it's like the revenue component is by itself standalone. It should be illegal to reference a revenue metric. I do 100k months. And typically at Sparky Coach, when we're selling a product, our revenue, you can pretty much predict the net profit of like, I got X-Mount revenue, you know, it's quite typical and predictable. But in the trade world, there's too many moving parts with labor materials to ensure that that revenue number, that revenue metric guarantees net profit. No revenue metric, let's face it, guarantees net profit. It doesn't guarantee anything. It's just a number that is meaningless. And if I've got my ego based in the revenue metric only, I waited a million dollar a month, a 500 grand month, a 50 grand month, my ego is based in that. I'm going to move hell or high water to get to that point. But I have to spend 10 grand on advertised. You have to spend 20 grand on a salesperson. I have to spend this on that to get to this. Yeah, I achieved my target. I didn't make any money. So who sort of cares at that? So you need the revenue metric and the gross and the net profit. They're your major movers. And arguably on that, the biggest movers is the gross and net per hour is your biggest movers, which is the per job. But yeah, it's so interesting to reference like the revenue metric where we're starting out. Most people where they get it wrong, is they're not getting the hours that they thought in. That's a huge number. Your labor efficiency. So labor efficiency is a huge, which is paid versus allocated hours. I'm not getting my hours in. Quality of hours is a more referencing the projects. I had hours out of a low quality. Yeah, there's, there's setting up cable tray with your two weapon staff members with all the materials on site and all the gear. And then there's setting up cable tray with no plans, no idea, wrong crew, to apprentices. And materials. No materials. So it's like, yeah, it's correct. Yeah, so one takes a day and one takes five days. So it's no good just allocating the hours and making sure you've got a hundred percent labor efficiency, which is paid versus allocated hours without referencing hang on a minute. Those, all those call, all that quality sucked. And sometimes on the larger projects, specifically if you've lumped your progress claims in early, so you're getting early money, early money can mask a huge problem. So I'm getting my money in early. It's covering all my discrepancies. I'm going to find out I didn't make money on this job 12 months down the track, six months down the track, 18 months down the track. All of a sudden, I'm sending labor and materials to a job where there's nothing left to claim. So my revenue is incredibly low. I'm doing everything right. I've changed my handling. I've corrected it, but there wasn't enough money in the job to begin with. So my last 12 months looks good. My last quarter looks terrible. And everything's going right, but that one job. Everything's going well, but that's what I quoting is it takes time to iron out these quality months. But your labor efficiency, quality of hours and profit on rate, profit per hour or profit per job is the huge move is in the revenue sense. And even if you've, if you've, let's take two examples, one is you work with cost plus staff and you factored you to not be billable and all of a sudden you become billable. So your overhead, per billable resource drops down, so you're more profitable. And one is you're meant to get 32 hours in per week, but you're not getting any hours in because you're feeding the team or you meant to get 20 hours in, but you're not getting any hours in because you don't have the workload or you're like, I'm full time office now. It's all good. It's cooked. Like if you're meant to be getting 20 hours in and getting nothing, you're going to raise your overheads up for everyone else. And you might not be profitable across a month because you're not getting your hours in. So there's so many like in the revenue metric alone, there's so many moving parts because every job is its own moving part. Every day is its own moving part. Every week, it's, it's no good even like, I know we close a week, but you have to close the days out like it's, it's crazy to think the moving parts associated with. So yeah, that's my thoughts on the revenue metric. Subcontractors can come in and sometimes a really high performing subcontractor let's face it. Most people's break even rate for trade is $100 to $120 an hour. And if it's, if you're getting a sub for 80 or 75 or 70, that could be $20 an hour cheaper than your break even rate or 25 or 15. So you're better off using subcontractors and let's face it, most subcontractors, not all, most are went out on their own because they're weapons. So you're getting a high quality person at a low rate or a low price. So they're performing the getting the hours in, but, but they're cheaper than your trade is. So they can mask a job. You might do the job for $5 and a grand of $1 million. You want to grant $100 grand, whatever. You might go really good in it. You do the same thing. You can do it. thing with your own stuff, Embers, and you might be gone backwards. So it's like once again the quality of ours, who was doing the work? If you're selling labor and materials, and materials are relatively consistent in their delivery, well the big mover is labor, who's doing it? Am I doing it? Are you doing it? Is Jimmy doing it? Is Jimmy sucks? Jimmy's given us an old record. So just a hot wrap. Going back to the, just the measuring of the job right. So touching on that is that I touched on that there's your labor and there's your cost that are associated with it. I think then one thing that a lot of people don't always look at is the why. So what are the notes associated with? What is the information telling us for this particular job? So it went really well. So like cracking high percentage net profit. Why? Right. So what were the influences? Equally, didn't go so well. Right. So maybe broke even, maybe made a bit of a loss. Why? What were the influences on that? Went mediocre. Why? Why are the influences on that? And like, probably touched on before there's so many of these influences associated with it all. So it could have been misquoted from the start. It could have been poorly handled in the office. So like we didn't get the cable tray. Who would have thought we needed a cable tray that it takes more than, you know, we couldn't walk into havens and get 25 lengths of 150 tray and all of the consumable items associated with it. I mean, what couldn't we? Like it just seems ungodly to think that. So it wasn't organized well. So then the flow on effect. And I would say that an unorganized job from day one, right? Think of the ball like the snowball going down the mountain. It just becomes an outer control like Boulder. It's very hard to rein that job back in once you've let the, you know, let the dogs out. So to speak, you know, it's like even having the right tools. Yeah. I've got a broad cutter. A rod cutter versus grinder or a verse like hacksaw and file, you know, and that's an exaggerated example. But it's just having the right tools for the right job is incredibly important cable rods. So what went well, what did so understanding it because then what you'll start to see is patterns occurring. And the patterns that you'll often find are associated with a with a with a number of things. So if we're looking in the positive front side of things and the negative side of it all, it's going to relate around a few things. So it could be staff related, for example. So there's a patent developing with particular type of people. Who are your guns and who are your not so guns? How was quoted? So did we quote it well? Did we not quote it well? Did we handle it well? Did we not handle it well? Like what the patent is creating. And then after you've identified what those patterns are that are consistently occurring, there's a bit of a rhythm that starts to take shape of it around the type of work. So generally speaking, there's types of work that people really enjoy doing and excel at because they're confident in their quoting, they know how to order the gear and they know how to execute it. So the patent that's been developed is this is the type of work that we need to be doing versus this is the type of work that we shouldn't be doing. So what pattern is the measurement of the job starting to show you and why is that the case and getting an understanding around it because there's no point continuing going down the dead end road if you have another path that is like the M1, like just a phrase. It's like we know that we can just do 100K an hour here and everything is dreamy. I think we've all we can all associate the type of jobs that you it almost doesn't feel like work for whatever reason. Like it's just dreamy, it's easy, it's enjoyable, everyone gets on, you know, the boom box is cranking, it's good vibes on site, it's enjoyable versus, you know, the complete like nightmare scenario of like, you know, how are we going to get out of this alive scenario. So though those is what I think you want to be getting out of the measurement of the job because it starts to give you an influence on what you are doing well and not doing well and essentially it's a really easy way of like it paints a picture almost of how you are performing as the business owner in the nicest possible way. It's like how you're probably falling short here, you're not getting enough time to get the jobs organized, you're rushing you quotes or you this is the wrong type of work to be doing for these people. So one thing we come across often that you'll see on it is people who are locked into like pricing. So like they're being dictated to the costs by someone else who, you know, Shock Horror has no idea of the cost involved with doing that particular job and they're they're flat lining and it's not going well. So imagine a job tells you everything, the direct correlation out of that that I wanted to get to is the labor efficiency and this is probably something that I am beyond passionate about and I'll reference past life time sheets. So when we used to I used to tick them off basically and approve the next week for the team and there was an ungodly amount of time associated with the office like the shed, like the office and we looked at it and we were like we which is you know if you're reading between the lines, unbilable time, like what am I associating that to. So we basically will like you can't put the office on the time sheet anymore like it doesn't. If you put that on there, it'll just be rejected and we'll have to have a conversation with me, etc, etc. So what I've forced everyone to do was to allocate the time that they were spending on a particular task to that particular job, which then in turn fills out your day and then in turn fills out your week so that I'm just going to use around numbers here. There's 40 hours in the week, there's eight hours a day, what were those eight hours allocated to, which then gets you a labor efficiency. There should you know in rare circumstances and I'm going to say very rare. I'm talking about like some kind of strange rare animal like the Tasmanian tiger that may or may not exist depends if you go into the deep dark wilderness of Tasmania. We'll have to speak to Baron or Hibb to see if it is or is not true. That the labor efficiency tells you everything. It literally does not lie. Are we organized to begin with, right? Are we running jobs in an organized, efficient manner? Now I'm really, really passionate about this like so if your guys start at seven and they finish at three, every single minute of those eight hours need to be allocated to a particular job and people will say to me, oh, but we did a rubbish dump run. Cool, no problems at all. Where were you dumping rubbish from? Oh, it was for four jobs. That's cool. Allocate a portion of the time spent to each one of those four jobs. It will give you an accurate metric of what time you actually spent on that particular job and even better if it was a cost plus job, you can build that time because it was part of the job, right? So labor efficiency really, really important. It tells you everything and what I will say is if you spend the exercise, if you don't do this currently and I strongly encourage everyone to do this time sheet wise, it'll be coming out in a pod maybe before or after this. I'm not sure. They just measure your time for a week, right? Just see where it just goes. And Groey was telling me a story the other day that there was a job from one of our members who shell-renowned nameless that they could have just spent three days in a row on the job, but they bounced around on that particular job across the five days of the week and was only getting in the half day here or there was a bit of time here. Whereas if they spent the three days, their job done move on to the next ones. So labor efficiency really, really important to get an understanding of where you are. Are you organized enough? Are you efficient enough? Are you, do you have enough work? Because often sometimes the thing that you're masking through the disorganisation is that you might not have enough work. So labor efficiency tells you everything really, really strongly encourage you where possible to measure. Because that gives you the holistic outcome around where it's sitting. So if we're looking at the revenue side of things, the revenue associated with it for the businesses one factor associated with it all. Now, if your revenue is not where it needs to be, it's why. What impacts on the revenue? So that's all the jobs that you have going on. All the small claims that need to be done, all the small scenarios, all the small situations, all that stuff that needs to be done is that they come together and build up the revenue, the progress claims, the small job that was done and where, recommencing it a month's time. So I strongly encourage you to make sure that you check where your jobs are at and making sure that you're getting that revenue sent out. Now, obviously you've got your revenue. Now, that's going to be offset for your gross profit versus your cost of good soul. So what makes up that? Your labour, your subcontractors and your materials. Now, this can paint a little bit of a picture here. So if your material are really, really high, right? But your revenues quite low, for example, why is that occurred? So, if you're having a look at the jobs, we can have a bit of an understanding here. So, it could be a couple of things here. So, a couple of scenarios could have occurred, could have missed quoted something. We might not have allowed enough material associated with it, so we haven't been able to cover all of our costs. I would say more than likely is that you have not made enough of a progress claim. Or you've bought materials ahead of time and you're going to start, you're going to be carrying that particular cost for your client. So, where possible, I strongly encourage you to make sure that if you are purchasing any materials for a particular job that their stage claims and that they're communicated with we're near. Hey, we need to buy the light fittings for this particular job. He's let them know about it, right? So, the cogs can have an impact. Where's our label sitting at? Hey, our label costs where they need to be. Some other instances that we've come across is the correct information being fed in to our counting software. So, how we got need double ups in there. So, I came across this the other day with one of our members that they doubled up on their material. So, their material costs were actually higher than anticipated because they had double supply invoices in there. So, if you're not all over the integration side of things with getting your supply invoices in there or you're not all over, hey, how I'm reading this. Feel free to shout out. I can help you to help with that scenario. So, that's the cogs part of we get to our GP percentage. Where is that sitting? What is that telling us here? Then we move on to our cost of operations. Now, these are the non-billable items that we touched on here. So, we're moving left to right here. The non-billable items could be to do with labor estimators, etc and stuff like that. And in a previous podcast, when we look at the considerations you've business, where your cost of operations are sitting and do they need to be considered in this particular instance? Right? So, our cost of operations too high. Are we spending too much money with our Google ads? Are we spending too much money with our SEO? Are our costs to acquire the work outweighing the work that we're actually doing? Are we paying too much money for something? In regards to say, it could be a subscription. It could be, do we have too many of these? We're not enough of these. So, having a look in that and seeing where it's particularly sitting to get an understanding where our cost of operations is because the cost of operations minus where your gross profit is sitting is going to be dictating to where your net profit is sitting. Now, I want to reference back to having a look at measuring out some jobs. So, we want to be having a look at measuring all of our small jobs and all of our big ones as well. Right? So, because we want to have a bit of an idea around where they are performing because we might just be metrically looking at how we're going on the smaller jobs. So, anything else that's getting closed out in a short period of time and they seem to be going well but we could be losing out on our larger jobs. So, getting an understanding where it's sitting and what the influences are around the jobs that we're doing and what the outcome is around that. Is that affecting where our overall ability to have billable hours is sitting? So, you may have a job that you have misquoted, for example. So, it could be a project. You have lots of hours associated with the job. So, you've allowed 400 hours for the job and you are now hour 500. So, while your labour efficiency might be giving you the vibes of, hey, we're filling every single hour of the week which is good. We are not billing every hour of the week. We are now gifting back. So, our revenue is going to be low. Now, these are seasons that you may get stuck in from times of time. I would dare say that there's not a single person out there who hasn't misquoted something in the past. That just happens, particularly a bit of a job that's 100 plus hours. It's what you learnt from it and why it happened. Hey, did we miss it? Miss Handel, did we miss manager? Could we have been a little bit better around that? Now, understanding that that's the cause and effect associated with it is that we have the ability to make a change. So, hey, I've got misquoted this. I don't want this to happen again. What did we learn from it all? So, while yes, it's giving us a 100 percent labor efficiency for the laborer allocated for the month, it's not giving us the information. It's not hitting the revenue that we need because we're down on our billable hours in that sense. So, really, really understanding that and to understand where you sit in there. So, if you were able to have a metric, you look in the beastermate, there's some forecasting associated in there with the metric of around a number that you need to be hitting in a revenue sense. Hey, so we could be looking at why we falling short of that number and then cross-reference it down to, hey, what is occurring? Now, going back to cost a good soul as well. What I have a look in here is that materials is a huge one and I think it often gets overlooked by a lot of the time and it's a lot of us to do with the relationships with your wholesalers or the job management system that you have with it all. So, job management system, you can link in multiple suppliers in there to give you some real time and sort of, I guess, live examples associated with, hey, where could we get cost in a different way? Job management systems also give you the ability to send out supply quotes to your suppliers in that particular sense also to be able to get costings that are worth, you know, that are good, basically, that are worthwhile. And so, worthwhile in the sense of sending them out to your suppliers and getting back information that can be compared and you can procure your material in a manner that is cost effective to your business and if you're spending a considerable amount with your suppliers, 5 or 10% here, all adds up so we don't want to dismiss the small things. So, the considerable amount is going to be thousands and thousands of dollars for everyone at a minimum, right? Up to tens, up to tens of thousands of dollars for other people and sometimes more if you're operating in material, heavy spaces like the solar and aircon sectors which are hundreds of thousands of dollars. So, you know, if you look at a hundred thousand dollar wholesaler bill for the month, if you're able to get 5% in some cost savings just by being smarter in the way that you do business, if that's five grand, over a year, that's $60,000, so it's the compound effect over time. Materials can also be looked at with your suppliers in a sense that, hey, how do we have a look at ways to be able to be cost effective? So, it could be substitute items. So, looking at other items that we can come across to utilize in a way that is cost effective for the project but still gets the same outcome. So, it could be alternatives. And that's what I mean by the substitute. So, hey, if we're using item X, we can use item Y, same, same, same, different in cost though and then if you're using a volume of them, the multiply effect along the way. So, having a look at where your materials can come into reduce your cost of goods, which then in turn can raise up your GP. So, these are all things that can be taken in consideration to be able to increase your net profit. So, if we're looking at a real simplistic way net, left to right, what are the influences on our revenue? Are we capturing everything? Are we getting our billable hours in? Are we building everything out? Why is our revenue hitting? Where we want to be or why is it hitting where we need it to be? Cost of goods sold. Is there anything amongst here that we can look at to be able to be reduced? Or do we need to be more savvy? And the main influence on this is use of subcontractors and using and using your material. So, they have influences around, hey, if we can lower those costs slightly, obviously, and creates your GP. Are the revenue is something to have a look at? Are we masking something by not taking into consideration or by taking too much into consideration the apprenticeship grants or things like that. So, having a look at where other revenue comes from being aware of it all, looking at our cost of operations to be aware of where our costs are going and what the costs are associated with the business. Is there anything we can do to be more proactive and more cost effective to reduce them? Which in turn will give us a better net profit at the end of the day. So, simply reading it from left to right, what are the influences that are occurring across the board to ensure that I'm having a good week, a good month, and then a good year? What are the influences that I can change? What are the impacts that can be looked at to be able to make change? Do I need to spend some more time in the office? Do I need to get more organised? Do I need some help just to get my job management sort of system sorted out? Do I need a bit of a push along to get things done? What are the influences that could help you achieve the outcomes that you're looking for? Knowledge is key, hey, what should I be hitting roughly? Where should my revenue roughly be looking at? Where should my cogs roughly be looking at? What's my GP should I be running? roughly aiming for where my cost of operation sitting and why and what is my target for my net profit to be. So having a look at it, having a understanding of like these are all the influences that come at play to get my net profit, which is my target. I want more of this or more of that. So having a look at what the influences that play at cost abroad and how can I control them? How can I get around them? What can I get better at to be able to get a better outcome around my net profit? So left to right. Have a look at it. Where is it sitting? How are you performing in a close the month sense and what can I change? What do I need to understand better and what are the greater influences that will have a massive impact on me being able to perform better in my monthly close to hit the target some looking to achieve? As always, thanks for joining in. Hope you've enjoyed the pod and look forward to seeing you all again soon. Cheers. That's a wrap on another podcast. Whatever you're doing, don't be too busy to stop and check if you're making money and above all else, you know the rules. Be kind. See you soon.