Emerging First Connections

(upbeat music) You're listening to the Profit Connections podcast. Entrepreneurs and franchise owners, you'll want to tune in. If you're looking to create a rock solid business, sick of being stuck on the plateau, and ready to kick it up more than just an arch, you're in the right place. I'm your host, Sharon Galuso. And I believe in unleashing your full potential to create resilient, successful businesses that in turn make significant positive impacts in our world. Welcome to the Profit Connections podcast. (upbeat music) - Profit doesn't happen by chance, it happens by design. Let's dig in. And today we are going to dig into profit and that sneaky little thing that it does leak out of your business. So you know when you're running your business, you know it feels like you're doing everything. And you're bringing in sales and you're running your business and it just feels like you're never getting ahead. The more you do, the more behind you feel. You're making money, but you're not keeping it. You're working harder and you're not getting ahead. So where is the money actually going? That's what we're gonna talk about today. And I know it feels really confusing. It's frustrating, it is overwhelming. And you know when you put your head on your pillow at night, you really just wanna go to sleep. And then some nights it's just the noise of, I need to do more, I need to sell more, I need to fix this, I have bills to pay. And all of these things are happening for you as the business owner because there's things going on in the business that you're not being able to control. And here's the thing. We tend to think as solution people, as you know we have to fix the thing, right? That there's one big problem. There's if I could just fix this one thing, right? We have a tendency as business owners to fall into that trap of it's just one thing. As we're gonna talk about today, it's really not. It's more than one thing, almost always. And each little issue seems really minor. So we don't necessarily pay a lot of attention to it. But what happens is together all of those small things create big leaks, big pulls away from how you are getting profit from your business. Now before we go further, let's talk about profit. What is profit? Profit is the amount of money you get to keep after you pay all of your bills. So you have the money coming in and then you have the money going out. So a lot of times those balance out, right? You're taking in as much as you need to pay your bills. You're taking in as much as you need to take care of expenses. And for a lot of business owners, that means you don't pay yourself. For a lot of business owners, that just means I'm gonna take all the money that I get and I'm gonna put it back into the business and I'm not gonna take anything from myself. And that is not a profit first business. That is not a business that is designed to make you money, to pay you to create wealth in that business. So we have to look at what are those little tiny leaks that are adding up that are causing these profit leaks, causing these things for that profit to run away from your business instead of being attracted to it. So that's what we're gonna do today. We're gonna break those down. So there's quite a few that are common to two business owners. The first one is conversion leak. You know what that means? You get the people in the door. Okay, so let's take a step back before we get to the leak. You do a lot of work trying to get people in the door, right? We know that's advertising, that's marketing, that's attracting the clients into the business. Now, a lot of times business owners will say, I'm just gonna do it myself, so I'm gonna save money. So I'm gonna do all the work and I'm gonna get people in the door. And what we fail to account for, we're talking about profit leaks here. What we fail to account for when we do it that way is that your time is money. Your time as the business owner, as the CEO, as the driver of your business, should not always be spent doing the minutia of the business. And this is what we do in the seven pillars of profit. We build up those seven pillars so that you are not always in that position where you're doing everything as the business owner. So the first thing is that you were getting people in the door and you may be doing it by doing all the work yourself. Now, once you get them in the door, you have to have the solution for them that they are going to pay for. So when you are, when you're in that sales process, that conversion process, you have to understand what is it that you're doing that will enable you to have the sale, right? You need to get the sale. Once you have them in the door and in front of you, you have to be able to convert that person, however it is, whether they're coming to you digitally or physically, you have to convert them into a sale. So what you're doing there is you have to have the solution to the problem that they have. A lot of times, we know what they need, but that is not what they're buying. So you always need to be tuned in to what your client is looking for and how your solution meets their need. And sometimes we need to figure out how to talk about it so that they understand that what you had is what they need. So that's the first leak that you need to look for. How are you converting sales once you have those prospects in front of you? The second thing is a pricing leak. And this can show up in undercharging and it can also show up in discounting. Now, I know what you're saying, but I need those. I need to under price. There's too many people in my market. I need to discount because people like a sale. Yes, I understand that perspective. However, it does not matter what you sell your product for. It does not matter the price of your product or service. It does not matter what your price is for your product or service. Yes, I said that three times. I want you to understand that the pricing issues that you have in your head are not reflected by the market all of the time. Most of the time your market is going to pay what you, what value you show them it is. And by undercharging and by discounting, you are telling them that your regular prices aren't valid. So you need to really be careful in this area. I will give you an example. We sold a product in our business that was $20. It's $19.95, $20. And it was for one piece, one service that we did. And I literally would have people come in and say, how much is X? And I would say, 1995. And they would have two different reactions. Oh my gosh, for just one thing, are you kidding me? That's ridiculous. I can't, no, I'm not going to pay that. That's a da-ba-ba-ba-ba-ba, right? And then the next person that would come in, I would say it's 1995 and they'd be like, that's it. That's all, that's all you're charging for, that service. Oh my gosh, it is so worth it. Same price, two different responses. You need to look for those people that are going to say, yes, that's the price that I'm willing to pay. That's the price that it's worth. So sometimes that means you need to really articulate the value of that product. So let me give you another little tip. When people would come in and they would say, how much is this product? I would not give them numbers. I wouldn't say it's 1995 immediately. I always tell them the price. But I didn't say it was 1995 immediately because as soon as you give someone a number, they're calculating in their head. They are doing math. They're, who knows what's going in there. But now once you give them numbers, you've given them solid information to do calculations. And so instead of listening to anything that you say, they are off calculating in their head. So once you say the number, you, you're not, they're no longer listening to you. So here's what I would do. And here's the tip that I'm going to give you. When someone asks you the price, don't give it to them right away. You're not being evasive. What you need to do is step into why they are asking for the price. Why are they, why are they interested? So what you're doing is you are creating an environment where you're asking them to step into their why. What is it that they want to accomplish? What is, you know, what is the goal that they have set that they have come to you for this thing? So if you are, if you're a dry cleaner and someone says, you know, I need to, you know, have a tux cleaned. How much is it? You could say, well, the price is 1995. Or you could say, oh, you know, oh, you're having a tux cleaned, what's going on? Now, whenever somebody's coming to you for a product or service, when you have that band day that will cover their bleeding wound, small bleeding wound, they need it right away, right? There's a reason for it. So when you offer them back to step, back into their why, you are actually opening them up to the value of what you're offering. So if you say, "Hey, I need to get a text cleaned. How much is it?" "Oh great, you have a text clean. What's going on? What event do you have going on?" Oh, my daughter's getting married. Oh, there's prom. Oh, there's something. So now you've invited them to step into the conversation they're having in their head. And they're sharing information with you about why this is so important. And once they are attached to the importance of their task, the importance of what it is that you're offering them, then they are able to go, "Oh, and now they're not justifying numbers. They're justifying reason alongside of those numbers." Because remember, every purchase is an emotional purchase. So when we invite them to step into their why, into their emotion, into their head, and what's going on for them, you are giving yourself the opportunity to show your value. Now, depending on what kind of a business you have, this could be a very short conversation, like the dry cleaner. Oh, prom, that's so exciting. Yeah, when is it? You know, you might ask a couple more questions, get all the timing, and then you would give them the price. So by asking them to the question before you give them the price, not that we're being evasive, what we're doing is inviting them into share their conversation that's going on in their head. The reason they're coming to you before we give them the numbers, when they stop listening and they start calculating. The next common profit leak in your business, and I'm saying your business because almost no one does this well, and that is the follow-up leak. When you contact someone, or they contact you, and you follow up with them once and they don't respond, the major percentage of businesses just give up there. They don't follow up, they don't keep them in the loop. Let me tell you, whenever we had people come into our business that were holding onto a coupon that they got into the mail, in the mail, not into the mail, they got in the mail, was literally on their refrigerator for two to five years before they brought that coupon in. Now the coupon had expired, they didn't care. They kept that piece of paper because it was something that they needed to do on their to-do list. So when we fail to follow up repeatedly, not badgering them every day, however, keeping them in the loop, reminding them who you are, reminding them that you can solve that problem. When we fail to follow up, we leave money on the table because we are just so distracted, doing our business, and they are even more distracted living their lives. So we do, I made your disservice to them because we are not solving their problems by following up and letting them know you can help them. And we do a major disservice to our business because we are leaving money on the table. Everybody doesn't come in after the first contact. Everybody doesn't do business with you after the very first time that you interact with them and not even the second or the third or the fourth. And I'm not really sure about what the statistics are right now, but between seven and 12 times is that a number of times you need to be in contact with the person in a follow-up to have them turn around and do business with you. So the follow-up leak is a major. And then the last leak is that is one that's a little bit more involved with us and the business owner side. And that's the capacity leak. That is the time and energy and the inefficiency we have around that. Remember I said earlier, whenever you're the business owner and you're doing everything and you're putting all your time and energy into something that's not the running of the business, that's not the CEO level stuff. That is a time and energy inefficiency that can cost you money on the long run. Because when you are focused on things that aren't making you money and you're doing all of the the minutiae and you're not providing the service and the offerings in the way that people can come in to do business with you, you are losing money. And all of these leaks lead to less money coming in the door. More energy and efficiency poured down the drain because we are not working at our optimal capacity. That's one of the things we do in the seven pillars of profit is we set all of that up. So your energy is directed in the right place that you're going forward in the way that you need to move forward. You are putting your time and your energy where it needs to go so that you can grow your business. And then whenever you have all of these leaks, it affects sales, a lot of these affect sales. And if we don't have the sales in and we have the expenses that are more than the sales are equal to the sales, then we don't have the profit. We need to, and another thing with profit is that is a structural thing that you need to build into your pricing. You build it into the structure of your business so that you're actually thinking about that while you were building your business. I know I've worked with people who have done all of the things. They put all of their energy and all of their efforts into the wrong things. They were inactive working with all of those profit leaks. They were doing all of the things that were costing them money, costing them time, costing them energy, and ultimately costing them profit. And when they got the seven pillars in place, when they got really specific, when they filled in these gaps, then they were able to grow and expand their business and went from being frustrated and overwhelmed. And honestly, let's talk on us for a second, feeling bad about themselves because their business isn't going well. That can be an immediate reflection as business owners. We tend to reflect that on ourselves. It's our failing if our business isn't doing well, right? So reflecting that on ourselves. And that is, that becomes a vicious circle. That becomes a vicious cycle. You know, we feel bad. So we're not doing as much. We're doing more and we're overwhelmed. And we just end up in this vicious cycle. And it's a downward spiral. So I invite you to step out of that. Let's step out of it being your identity and being your personal failure. Business is something you do. Your business is something you do. It is not who you are. You are a valid human being running a business. We sometimes will conflate our identity with the business itself. So here's what happens is that it's a whole bunch of little tiny things that cause big losses. You know, I say, I'm about micro strategies, right? Small gains lead to big wins, right? You get the more small things you do well, the more money you make, the better your businesses. It happens in reverse as well. The more tiny small leaks you have, the more profit loss you are producing in your business. So small things on both sides. To hear the truth, it isn't just one thing. And lots of times it isn't one big thing. It's a lot of tiny little things that are draining your business. And the fact is you don't have a revenue problem. You had a leak problem. We need to shore up those leaks. You know, I talk about the foundation of your business that there are small gaps and cracks and weaknesses in your foundation and those things cost you money. They can't cost you time and they cost you energy. And profit is a is a result of structure. It is not luck. It is structured. The more structure you have in your business, the more ability you have to bring in that profit. And you know, the thing is that these gaps, like we talked about, they are across a variety of the areas of your business. It's not just necessarily one thing, but it's a lot of little tiny areas that you need to be working on those leaks. The seven pillars of profit cover every area of your business. So here's the real deal. You can't fix what you can't see. So what I'm going to do is I'm going to give you my profit growth audit. This is a self audit. You go in, you answer, but answer a bunch of questions and it will give you a report back that shows you where you're doing really well in your business. Where are those gaps? Where are the leaks? Where are the places where you are losing money every day? And you can actually have an empirical data sheet to look at. You can see, oh, in these areas, I'm doing really well. In this area, just a little bit, we could get better there, but it's not terrible. And then there's areas where you're just like, whoa, I did not even realize that that is an area where I have persistent leaks. And then you can you can use that information to look at your business and figure out where in the seven pillars of profit do you need to work on? Where are those gaps and weaknesses? And where are the little tiny leaks that are costing you profit? So what I'm going to do is I'm going to put that into our community. And the web address for that is profitconnectors dot CLUB. That's profit connectors dot club. That's our portal. That's where we give you all of the gifts from all of the guests that we've had. You get to see their contact information. You can rewatch all of the podcast episodes and you can get this gift along with all of the other gifts. So go to profitconnectors.club and you can go right in there, it's free, and you can get the profit growth audit that you can take today and see where your profit leaks are showing up. Thank you for joining us today. Remember to build with clarity, to lead with purpose, and I'll see you next time. Hey profit connectors, that's it for another Profit Connections podcast. Thank you for joining us. If you're ready to make moves and connections to take your business to the next level, want to get to know us and our speakers better and get your gifts and resources. Head over to the website profitconnectors.club. That's profitconnectors.club and get your goodies right now. [Music]