Tracking Key Performance Indicators to Drive Business Growth


Visit this show online at

Follow us on social!




To learn more about Robin:


Robin Stalanad, Master Chair at Vistage International, is a force to be reckoned with. She’s been a Vistage Chair for more than 15 years, and is a six-time award winner, putting her in the top 20 Vistage Chairs out of over 700 in the United States.

In this episode, Robin sits down with our host Stephen King to discuss how companies view their metrics, what impact that makes on their business, and how tracking their KPIs allows them to make data-driven decisions.

What we talked about:

- The success stories she’s seen in her 15+ years as a Vistage Chair

- The mindset of a CEO when they start looking at their scorecards.

- The trailing 12 months report and why it’s so crucial

- Why raising your prices might just save your business

- How companies view their metrics

- How tracking KPIs allows companies to make better data drive decisions

For more episodes like this one, find us on Apple Podcasts, Spotify, or our website.

Listening on a desktop & can’t see the links? Just search for Path to Profit in your favorite podcast player.

And entrepreneurs are people who takerisks, they like change, they like shiny things and squirrels, and theycan be distracted very easily to go to the new thing, as opposed to theKnittin gritty of the running the day to day operations. You're listening to pastor profit, apodcast looking at business growth from every angle possible. If you're lookingto hear stories of success and failure, lessons learned from leaders that havegrown and scaled their businesses you've come the right place, let's getinto the show hello and welcome to path to profits.Thanks for listening, I'm Stephen King and to day I'll be joined by masterCherat vintage Robin Stan Elan, we'll discuss how companies view theirmetrics, what impact it makes on their business and how tracking keyperformance indicators allow them to make data driven decisions. I'm reallyexcited today, because I'm here with my very own vestage chair, Robin Stan Lenbrother Thanke, Stephen, I'm delighted to be here Robin that years of being avising chair. What are your first members actually were. One of my firstrecruits. I know I was so excited. What is that you? I A long time- and I havemy fifteen year- visitah award right here behind you you're also a six timestar award winner right. That means you're the top twenty vestage jars outof what Sante seven hundred chairs around the United States and six yearsago, you've come out of taplow no surprise to anybody. Who's investedgroup agt twelve, because we know we've got the best chair and I'm excitedbecause you know your vistas relationship is reporting arelationship as I have, except outside my family yeah, and so we spent a lotof time together and I really enjoy the lessons that you've got with all theother members you work with, and I was interested in just learning a littlebit about the other groups. You serve and the companies in those groups. SoI've got five visage groups and there's a very wide range of types of companiesand size of company, so anywhere from a couple million dollars year in revenueto a billion dollars a year in revenue bill would be a billion with a B yeah,so all from plastic resin distribution companies tolegists and chucking flooring. Companies moving companies,kelling company, not alter like non prophets all over the boy. So what kindof issues do they have? You know it's in you saying, regardless of the sizeof the company from the billion dollar guy to the two million dollar guy, theyall have a couple of the same issues over and overagain, one being people, of course, everybody's going to have people issuesyou, but the other is really understanding their data and managingtheir businesses from the numbers. It's surprising to me how many CEOS don't dothat? Do I surprising right? Do you think it's fear like you, don't want tosee the bad news or is it yer know so...

...much that its fear or an understanding,a fear O that they don't understand what they're telling them more thananything, not sure that is up that they don't want to look at it. A lot ofcompanies get to be fairly large without a C fl, so they may or may noteven have a controller you'd be surprised at the size of companies.I've seen fifty million dollar companies without sentot they're, justgood sales and service of product, absolutely they're good at what theydeliver h, and so that lack of understanding is that. How does thatmean? What's the impact of that on the business I mean they got to fiftymillion Nolan dated different decisions, and that's what's been so amazing aboutwhat you did for our group. It was such a gift that you gave to us. If I don'tknow, if you remember or not, we had this, I'm sure you do. We had thisspeaker and he was speaking on different co tools. You could use inyour business, but one of which was really tracking our Kes, how to attractthem and using a trailing twelve to do so, because it gave you a much betterpicture. It kind of normalized the the financial picture, and I remember youspecifically that day that the light log just went off for you and you gotobviously you're the numbers guy in the room, but you went away and took thatand created a score card for your company, and I came back the next monthwhen, when we were reporting on our check in- and you had, this amazing kichart that everybody was jealous of and you started explaining what was goingon in your company, based on what you were looking at on that car andeverybody was like, we got a gat one of those, so you created a template forthem and so much so that you know a lot of the guys. They probably still payyou to create that to generate that. For them, we now do it for free yeah,even for all the members that used to pay you yeah and for when I do vistospeaking or for we create one for every prospect that we meet because we'vejust automated the process so much it's easy to do. I didn't know to do thatfor the prospect yeah. I knew you started speaking to the Sich groups andthat you're doing that as part of what a gift, because in my other city, Ogroups, it's not yours H, you did that for us, and so what does it meant? Oh,my gosh. It isn't that that they are able to make better decisions whichultimately gets in better results in their business. Just like with one of our members inyour group. Specifically, they were able to look at what was going on withtheir revenue and that income and able to make some pricing decisions based onthose tracts and your recommendation. I remember that discussion yeah and itwas hard. That's because you were really dealing with the fact that theyweren't making money and everything they tried. Cutting costs, investing insales and marketing diversifying prod lines wasn't getting them there. Sowhat did we do? We recommended they raise the prices which they hadn't donein like was it seven years or seven or ten years as a husband and wife teamand the husband's not in our group. But the white is, and so we recommendedthey raised prices. It was a year ago, December, a year ago December, so theyraised the prices, but then...

...surprised all of us. They got anycompetitor in the market that came in at a really low price, like I don'tthink they were making any profit at the price. Those people were selling itright and our member was nervous because her husband was telling herthat her vestage group pay for some that by there we some bad words weresome. A very bad word be used a you blankety blank vestage, who told us toincrease prices, and now all my competition stole a third of ourbusiness, and do you remember him saying I drive by there office on myway to work every day and they're a harding one is empty and I've got threetrucks sitting idle and I'm paying a Lisson yeah yeah and he's like what'swrong with you, people as mad and he's got big arms yeah remember he walked inhis red face and kind of ready for it to show us that we were wrong. But whathappened was really interesting. What the outcome was. Wasn't it yeah? Wesaid, let's get to pin else last year this year and let's take a look andwhile revenue was down, net income was way up way up and if you remember, hewas not looking at your Papi charts for was he any and not even sure that shewas looking as closely because you well,you brought it up in the meeting. What's what's this about? You knew whatit was, or at least you hope, Jordan, but when we pulled up those panels- andwe showed him, he couldn't believe it- they went from a wass for the yearbefore to making a couple hundred thousand dollar profit in the first sixmonths of the New Year and when he I remember what he said was how was thatpossible? Have my trucks? Three of my trucks are not running and my I'mpaying for those trucks. Yea, we said was because you were losing money onevery run that you made. You can't make it up in volume if you're losing money,and then we showed in that- and we made him understand that the competition isnot making money it. It was only a matter of time before they couldn't dothat any more they'd be out of business, and now they got to get three morechucks they're so busy. They can't give up of the work. I know because, asother guys couldn't deliver and what I really find most fascinating is thatwhenever I see a business with cash, a problems, it's always driven by their,not pricing right, because when the husband said to theway like we're making money, she turned an says: I've been telling you we havemoney in the bank for the first time. Why do you think we have money in thebed because we're making money yea and I think most business owners- don'tunderstand that if you got casual problems, it's going to be because ofprice right yeah. So so in your in your five groups and you're looking at thescore cards, what kind of questions do they have about? Reading the scorecards and using them I mean what what's the mind set of a co when they start toget a score card kind of opens up a whole new world for them, and that justraises a lot more issues right it does and and which is why I love that you'regoing out and talking to the CEOS and all these visage groups they know of myother CEO Group. I wish you could be in...

...there every month, like you are fargroup because they come up with questions all the time right word workand in our group you're, like so good to answer them. I want the biggest. IsYou know? What's this trailing to all mean you? Why is that better thanlooking at just my month every month? And while you talk about that your talk,it's they need to be reminded of that. You know we in years of visage. We havespoken about this, probably fifteen times right every time you remember itcomes in a e, but it's a hard. It's not! You know. We can't hear it once so. Thetrailing twelve months tells you the total for the twelve prior months rightand that dot on the chart is an annual ized total looking backwards. And whenyou look at a trend over a year at the end of the year, you've got two yearsworth of data, the twelve years ending at the beginning of the of the twelveof the current month, a car of the year, and then what the last year has doneand the reason that's so important is because it eliminates seasonal ty, a iteliminates all those big spikes that are going toinevitably happen in every insons, and it's particularly important for anybusiness that doesn't have a really strong accounting department. If youdon't have a cruel at the end of the month, if you're recording revenuebased on when you got paid for you just not matching the timing of becomeexpensive one individual month, is it going to be accurate? And so you end uprunning the company based on how much cash is in the back. That is a lot of T.I know crazy surprising because after you run pay roll, the cash is gone.Your bank balance is different yeah, but to that point on the challen twelve,so you did something new this year with your kick at Chart, what you put atrailing three three on rolling three months. Yeah tell me that's something!I've been getting a lot because of that change. Right. So tell me to tell us:What's the difference, why? Why is at some point so version? Three Point, ohof our P, to kit. We had it trailing three months, because what it is it'sthe same thing as trilling twelve, except as you would expect it's thelast three months. What that does is it's like a leading indicator of whatis going to happen in your trilling twelve, the problem drilling twelve isthe most important way to measure everything. The problem is, though,it's a two year trend. It takes a long time to change a two year trend yea, soyou can't really tell okay things are going well, but what is this going tolook like in the future? Whereas the trailing three months? It's a leadingindicator, so if you're trailing three months is higher than your trailingtwelve months, your turning twelve months is going to continue to go out.If drilling three months goes down, then your trailing twelve months isgoing to go down and you can figure out. You know what I always tell people ifyou want to use these score cards to figure out. Where should you focus yourtime if you're delling, three, it's goingdown trailing twelve on revenue? Okay, I got to look at the pipe like I got tolook at Leeds. I got to look at sales. Oh, if it's going down on Gros profit,then I got to look at my above the line cost I got to look at the operations onWi at my being is officiant because things are getting worse and if it'sgoing down on that income, then I got to look at my overhead, my below theline costay. I think we can cheaconies.

So so, what's the getting the scorecards right, you got. A couple of groups are using our kempt yeah and andhow do they use it? What do they use it for? Well, they use it for decisionmaking, they use it. They use it to just know. What's going on in theirbusiness data driven decisions are so important and that's really being thebig shift that I'm trying to get my members to make it. But why is that soimportant? Because most of them are on Jepan ars right and entrepreneurs arepeople who take risks. They like change, they like shine things and squirrels,and they can be distracted very easily to go to the new thing, as opposed tothe knitting gritty of the running the day to day operations and making sureprocess and procedure, and and that's why I think it's so important, becauseit's good looking it's quick. It gets to the point of what they really needto see and it really helps them make those date of driven decisions at leastask the questions and that's how we use it an Argot. Really I mean your VistaGrip is really designed to question your decisions were not there to tellyou what to do or how to do it. But it's just a question: You so you'llthink and that's what that Kaki told does. Is it just gets them thinking andwe're using it as a group, we can ask questions about it because I can't tellyou how many time someone is oh everything's, long great that we'relooking at that, and we could say it really because you know I'm seeing atrend here and you're not talking about it, but something must be going on andmost of the time they don't know what it is, but it causes them to go. Asktheir financial person, war questions, and you go do that, so the decisionreally at the highest level is where do you focus your energy? That's yeah,it's fascinating! So are there any like I'm not in the other group. So what arethe kinds of questions they're asking that you know one of the questions iscome up a lot and I haven't memorized the answer, but you always have it soeloquently is: Why is sales commissions not in cost of in soul? HMM, that's agreat question so because, because cost of goods sold implies sets right, youryour SI gotta have a sales person that the cost of the alrighty is that notincluded above the lining muse got so because it's overhead, because none of your customers are paying youfor the work that the sales rapid, the sale trap is creating an opportunityfor someone else to deliver value. He sells not delivering value right.That's there chewing up the work, the cost of BOO sold. The count onlyincludes the direct expenses, the direct labor and the direct materialsthat are what the customers paying for. That's the easiest. What I think aboutit! So if you, if you, if you could not have that customer service, you couldn't earn anyincome unless you pay for this work. That goes above the line nobody'spaying for ourselves unless the cells are also is an accounting second.Actually they at their delivering services and their hellship. Then theysplit the cost above the bowline. But...

...what you're asking is for is, I think,what your groups asking is. Well, don't you need to calculate the salesexpenses in order to figure out what the real profit is? A and so grossprofit is gross. It's the highest amount of profit margin that you've got.That's just the direct Labor in the direct cost do ject materials, but what you want to do is take yourgross profit subtract, your sales commissions to get you contributionlarger. That's it! That's the thing most UN understand this country yeah.So what is contribution? Martin contribution margins, like the netcontribution that each customer contributes to pay for overhead andcontributes to generating a profit, and so you take your gross profit, yourhighest litter prophet. You subtract out the variable indirect expenses, thevariable overhead. So what does that mean? It's overhead is going to be yoursales, your it your rent, if you have any of those costs that are variable,meaning they only happened. If you had that client hack, like a sales crimenor if you had to rent an office for that clime. Well, you want you wouldn'thave the rent. If you didn't have the client, then you subtracted from roseprofit to get to contribution, okay, and that shows you, the real profitthat you make. That will allow you to contribute to Ottoline things prettysimple. I know a lot of people that don't understand. Well, I thinkmanagement, accounting overall and manage reporting is not how CPA and youknow the B for thirty five years yeah, we haven't been trained that way. Yeahwe could train to look backwards right. This is out looking forward so and andalso seeing it in picture most of the cos they don't want to look at rose now.IOIADA charts are so nicely a yeah. So what else do you see in your groupswhat they're looking at? I think one of the questions. I've also been ask us:Why is it that we're tracking netting hut? Why are we looking at a cake, afor Nanito Shon Eye evado spends, so he I do his earnings before income taxesto preciate, son and amortization. So if you have evadin a great place holderfor cash will, if you have a lot, if you buy companies or you're buying andmaking big investments in in in equipment or plant and property ormanufacturing you're can have a lot of depreciation. If you buy a business youmight or buy some suffer, you might have a lot of advertist on yeah. Thoseare non cash expenses, so evita is totally the right way to go instead ofDenica or in addition to when you're, when you're earning yourdepreciation. HAMARTIA ION is a big number because then I eva diesbasically a place holder for cash, but if you don't have a lot of depreciationor a lot of Amortization, then then never goes poky. Okay, that makes sensegood. So what other issues have you got in your group? What kind of you knowfinancial questions? So, in the other Group A couple of the additionalquestions I've heard them bring up since we've implemented. Your scorecard is: Why are my actuals going up in... trailing twelves going now, so themonthly trend looks good Wa and but the Tralee o Mons looks back okay, thatit's a good one, because the trailing twelve months is the one you reallyneed to pay attention to. So what is the actual going up? Show you. It meansthat the beginning of the year was lower than the end of the year, so thenumbers are look like they're getting better, but it could be just anartificial, a month or two you're, a really good month in November, in areally bad month in February the trend is going to look good, but it doesn'treally show you the true economics of the business, whereas the trailingtwelve months is going to show you the trend. Over two years. I just saw this.I was speaking in Okarian Florida, this niners and there was a member who hadthat exact situation yeah. So what happened? Was They benefited from thehurricane? So Big Hurricane Ks, Florida, two thousand and seventeen businessgoes up. They are vacuuming in the business that help evacuate people andtheir transportation business, and so they had a really good year in twothousand and seventeen two thousand a d eighteen, that business went away, andso they are over a two year period. Their numbers were declining, however,so it was declining. You know down to the point where, in January, twothousand and eighteen there was slow months, but in the last two or threemonths they had some really nice revenue. So it looks like for twothousand and eighteen they're in a trajectory up, but it's an I wasn't.The whole year was performing worse than two thousand and seventeen, sothat means, if over a two year period, if the second year is worse, that trendis going to go down and what most people don't understand on thattrulling twelve months is the change from month to month represents h thedifference between the month that got added. So we just finished January. Wejust act last month and the month that got dropped off January. Two thousandand seventeen an think understand that right. So if you're trilling twelvemonths is going up, it means that the new month that you added is better thanthe month that went away. So I I ye make complete sense. You mentionedpeople issues. I think this is the most important right you in capital. You getthat right. I mean because what I say in my presentations is, you need afinancial management strategy and you need a human capital strategy just like.If you want to lose weight, you need Diet and exercise right. So so talk toyou about some of the people. Issues that you see retenir is is really a bigone journal for my members and clients in general turn ever Stansas tickleinto that right. It's fascinated because you know we're data drivencompany right yeah. My number one metric in this company is employed tothem. Yea We with everybody in the... knows right: We want clientsfor life and we went employees to build a career because we're all run bytravel knowledge when a member of the tribal ees so does the knowledge. Sowhat do you advise? Well, they don't have great store parts like you haveright, so it's really hard for them to know when, when is the right time tohigher, you know, how do I analyze sales process and know that I got ahigher ahead of the car or in time I don't want hire before artily dependson the cycle for hiring and the cycle for sales and now for parts, which iswhy those that use them in our true really have a competitive advantageover even haters yeah, we were were in a Clino inspirit right, so I learned alot about human capital from them, and the one thing I learned is that thesingle biggest reason why people have churned overs because they were theyhired a wrong. In the first place, they made a bad hire the reason they make abad hirers because they're in a rush they needed somebody who could fivemirror yeah right. They had the job, a O fetch PAS, that hands along and ifyou don't have to give two weeks notice, you're more attractive to me thansomebody who does that's a nightmare, because you end up hiring for skillsand not behaviors or cultural, fit where it takes eight to twelve weeks tohigh something. So you need a leading indicator so at eight to twelve weeksin advance, you can tell when you need to hire when you need a new person, soyou can start the process early enough before you need them and if you end up,you know the leading indicators, just sales and marketing. If you end up thatthe sales and working the sales don't come through, then you just don't makethe offer yeah, but you got to get started earlier on, so you had to beproductive about it and sells recreating is essential yeah. So that'swhat I like the sales blon mill. What's your earliest indicator, what what'sthe beginning of the sales process of Yourth if your sales cycle is eight totwelve weeks or longer, you should have no problem knowing when you're going tohire. Somebody- The second thing I put in there is what's the most predictablemetric, meaning that's the one that it's money in the back. I know that ifwe are going to get get proposal out of the dorm, fifty percent of those pollsare going to close. So I can predict. I got a thirty to sixty day sound cycle.I can predict thirty to sixty days now how much new business I've got, whichmeans I'm going to be around. I imagine this people that don't track that yeahyou got us just. I can't imagine to be honest with you. I don't know any otherword. I numbers Gameth, many people don't have that data or in my otherworld, outside of this is sharing. I sell businesses right. I don't bisnessan me a so so you're trying to help businesses exit exactly yeah, that'scool, and so you get a call from someone to come in and they want tosell their business and they think their business is worth generally morethan it is, but you go in and they don't really have any communicators.They don't know what drive sales, they don't know what tribes grow. They don'treally have the right to counting...

...processes like reporting to be able totake that and market. It can go out and find a good financial via. So what'sthe impact, what does that mean a whole lot? Less money for them real example.I took someone. One of our friends asked me to take a look at theirbusiness and you you take it to a market today and they could get twomillion dollars for the business, but if they just made a few of thesechanges that we've talked about today, that business is worth twelve milliondollars really, and so they just need to. They need to wait. They need towait a couple of years and put some of these processes in place and theirbottom line. So so whwhat letter S, what's the specifics, the drivers thatwould increase the valuation of a company, the drivers that are going toincrease it obviously are that the net in copie genetic, if number, is soimportant. So it's those expenses that they don't pay attention to. It'sknowing what's driving the sales and being able to understand the leadingindicator so that you can sell on that right. So, if you understand those,then you can go to market and be able to show the perspective. Buyer me besare leading indicators e driving our sales. This is where we're going to be.You can can sell on some more projections, because you have the datato prove so you're saying that you can't just put numbers in a spreadsheetand expect a buyer to pay you on that. You can expect on Tokyo, but they'regoing to be now they're, getting a really good deal and you're not goingto get anywhere near wait. Your Business is really like, but if you canshow you can track that that historical trend, then you can start to use thatincrease at just. I justify an increase valuation boring forward. Absolutelythat's also, and a lot more comfort level from the vier standpoint on whatthey're actually getting and that it's sustainable I mean there's certainthings about a business that make it more marketable right. You have abusiness owner who is the only sales person they're, the rainmaker they're,the guy that goes out there and talk to all the clients that that decreases youbout as he doesn't have a sales engine, whether the Indoles are out on sellsthat operates without him. There's a lot of times a lot of the businesses.Don't have set processes and procedures for how things are done, it's all intheir head. It's all tribal knowledge. Without those documented and clear cutyou know, processes decreases the value without in that income a lot ofbusiness owners live out of their business. You would be amazed at thethings people pay for out of their businesses, so getting those finialcleaned up so that when you do get them into these charts, it's a real late at its actual data.You know you also pierce the company Veil Right. If you pay personalexpenses out of Your Corporation, which means you don't have a limitedliability in a corporation, that's something! I don't think that I knowthat tes not business on or stop yeah. So so the books really have a legalimplication, as well as a business valuations, a yeah, the well I plan isreally businesses. Is that value around twenty million and under and so in thatworld that that's primarily the type of business that you're dealing with whenit comes to my business acquisition is...

...fessing. So how do you get ready for it?A ecent I mean. If you want to mind, you know the like, there's like threeways to what you can do with a visit right. You can run it till you die. Youcan sell it to your managers or your family or you can sell to a their partyright. So so how do you get ready for that inevitable day of one of thosethree things happening? Well, I think any of you send the stuff we talkedabout you. You have good financial measures in place. You need to have asustainable operation that can run without you. You need to have a brandthat isn't attached to you personally, so that when you leave the new ownerand be assured for the business, I continue and I mean those things I will help alot in getting that business ready self. You need to have customers that arediverse. You can't have more than ten percent of your revenue coming from onecustom. A lot of Soluce have one customer, I think up fifty percent ofthe revivations detractor of value, and so I think, if you can diversify yourcustomer base, if you can profess us some procedures in place, you can havesales strategy and pipeline that doesn't involve you and you have goodclean financials that have just business expenses in them and if youhave this k pis that you guys do for businesses. I know when I am referredto a grow force client, so I don't have any worries when it comes to thefinancial side and it's we have great reports, we have buyers who areconfident in what we're giving them. It's very much helsa business arehaving. This is, takes a business for moral. You got to under ready workpapers right, so the Deloul through that's right, because in this spacemost people are auditing right right. It's just not you not send mine forthat. So having your stuff having having clean financials really helps ancomes. Did you tell ye makes a lot of sense so to that points, even on a lotof the companies, I talk to they'll have one customer who makes up so muchof their revenue and they think that that's their best customer you and alot of times of being company and when those big companies are taking up thatmuch of your mind share and your energy and there usually have the lowestmargins and they are generally taking up most of your energy, and you thinkthat, oh, my Gosh I've got this big account. My Hiller count. We've got aservice in Botauris, but I think that there's ways to tell that it's notreally eno. I have so many examples, I'm so good to mentioned that, becauseyou know we just had this with a client the about a year and a half ago thatcame on board and they they were. You know eight figure business it company,where apple was their biggest account. They were really proud about Idalian.So they naturally think that your biggest account is your best account,and so we come in and we do our job costing right. We said up, they hadtime tracking because they're in the IT... and we connected the timesheets with the Pay Roll and we automated the process of allocating thelabor costs based on how they spent their time right in sperit and into it.Have that automated, and so we were able to show the labor cost foreach of the jobs they did and all the a d all the work, the service items theyworked on and we ran the profitability reports by customer and apple wasbarely breaking even to Ross ice. No because they have, they have cal right,they have in t they can drive that cost down, and what really was wassurprising was- and you see this a lot- they were using the most expensive peopleright. The senior manager Labe provided the best es they're, the biggest client,so who gets the attention of the owner and the Management Ime? What happenedwas every business that has knowledge.Workers is short of people right, tits people issues as our biggest issues andso recruiting was to challenge, and so we came in and said what you reallyneed to do is look at firing, your lowest margin, clients andreplacing them with these new HIARTA business that you're not getting tothem and took them a while and then and- and I talked to business all the timethey say fire clients. Are you crazy? I need the cash flop, I'm going to lose,that lovely payment and what I say all the time is your low margin. Clientsare what's causing you to have cash problems, fetch again, I I ap we didand they last year I remember when I looked at the pals. They made a milliond five and profit one year later, only ash because they fired their lowestmargin business and they replaced it with good money clients. Without thatmanagement, county and reporting, they wouldn't have the job costing timedreamin activity base costing mix a really big difference, yea, and so then,how did they know where? To? This is a question I get a lot then? Where do Ispend my marketing and sales dollars now that I've gotten that client? The way I got to gosouth to more? I got to find another line. So I like to say you study thepast product, the future right look at what which of your marketing campaignsgenerated the most profits in the past. The biggest mistake I see in sales andmarketing is that you wrote you measure the results basedon sales, that you think I got a good sales pressure right, generating a lotof sales which you want to do. Is You want to measure the results based onhow much profit they contributed, because some people are sellingcommodities right? We have, if you got a fifty percent margin and you give aten percent discount. You got to sell thirty three percent more business toget the same. Girls, profit tors. Ah, that's amazing. That is amazing.Remember we probably excited that is a a moment for everybody that hears it.Everybody. I've got a great slide in my listig presentation on that, and so by figuring out putting putting into youraccounting system doesn't matter what...

...accounting sist you got to. You knowyou serve quick, but that net sweet you put in it into the customer record.What the lead source did. Each cast a cut from what sales rap did generatedthat sale. What industry was that Clinting? You Run your profit of it:Your plant profitability reports by sales, rep to figure out WHO's, sellingvalue and who's, offering discounting just a commodity sales ships. You lookat the. What and this you know. Chief, outsiders is one of our clients rightart, Saxby taught me this one he's wet, he said: Can you put it up a field intoquick books for lead source, and so we did was every customer we identified.Where did the customer come from and then marketing is kind of fuzzy rightwas e Ne Esli I was at a trade. Show you do your best o my fa. Wawer able todo is we were able to run a profitability by lead source, reworkand in fact, as a vistas impact here, because a year ago, two years agoJanuary, he emailed us and said I got a build from visage because you knowthere are a plan um sponsor it's a six figure in voice and it's January we'rea partnership for tax purposes. So we distribute all our cash to the partnersof December. I don't have six figures, the tank, so I'm going to pass onsponsoring vista and what he said is before I do that, though you tell mehow much revenue did I get from sponsoring vestige, and I team emailback and said yeah but you're asking the wrong question. What questionshould be, but that much profess? How much profit did you get from thatinvestment and he had four times higher return from sponsoring decision than hedid from anything else at the time. So he made that decision to continue tosponsor visage, because, instead of using his gun yeah, I don't have anycash man she reporting he's like. I almost didn't do that yeah, it'samazing! So that's how you that's how you got to go out now you fire thatbiggest client. You got to make sure that the pipe lines filled. You make aDainger oven decision to study the past profits to figure out how to do in thefuture than is d that I'd be able to sell on. Well Robin I love when I spendtime with you and I value our relationship and I'm so happy. You aremy chair or just about out of time here today, but I know I got a lot out of it.I hope it was fun for you. It was so much fun and I learned some stuff. Ican take back to my members now all thank you for having a more thank youfor coming. I hope we get to do it again. Ned You, thanks for taking thetime to join us on path to profit and to the rest of you. We'll see you nexttime. Growth Course is the smart back office solution that CEOS need forbetter financial management at their business, delivering a level ofreliability, consistency and expertise that is typically reserved for midmarket countable from advanced bookkeeping management, accounting,Controller and advisory services. Growth Force provides dedicated teamsand cloud based technology that becomes a scalable solution for your business.You meet you where you are to learn more. Is it great forecome you've beenlistening to Pattereth to ensure that... never miss an episode subscribe tothe show in your favorite podcast player, if you're listening an apple,podcast, we'd love for you to give a quick grating shot just HAP the numberof stars, you think the podcast deserves. Thank you so much forlistening until next time.

In-Stream Audio Search


Search across all episodes within this podcast

Episodes (24)