Watch or listen to Mike Michalowicz. It’s the same awesomesauce either way!
Being an entrepreneur sounds fantastic: You set your own hours, do what you want and you can make a lot of money. But if you’re in business already, you know entrepreneurship can be the opposite: Many entrepreneurs work late nights, do meaningless busywork and still have to buy everything on sale.
If that’s you, you’re probably not lacking passion, drive or skills. You’re lacking profit. Today’s guest Mike Michalowicz has helped thousands of driven entrepreneurs escape entrepreneurial poverty to run a better business and live a better life.
In this episode, Mike Michalowicz shares how you can become a wealthier entrepreneur—even in crazy times like these. Want to build a solid foundation for your business so you can live a better life? Listen now!
Show highlights include:
- Why the recession turns small businesses into future juggernauts. ([6:48])
- How to make more money in a recession by changing nothing about your finances. ([7:45])
- The “business hierarchy of needs” and how it can save your business. ([10:27])
- The case against going with your gut. ([13:14])
- Why busy “solopreneurs” screw over the unemployed. ([18:07])
- How to reinvent your business with a simple phone call. ([19:21])
- United Airlines’ counter-intuitive email strategy—and how to use it to transform your own business. ([20:52])
- How to make real profit for the first time in your life by opening a bank account. ([24:04])
Remember to download Grandma’s Top Tips for an Independent Financial Future by dropping into https://grandmaswealthwisdom.com/free/. It’s time for YOU to break through to a smart, stable, financial future.
If you’d like to see how Grandma’s timeless wealth strategies can work in your life, schedule your free 15-minute coffee chat with us by visiting https://www.grandmaswealthwisdom.com/call…just like Grandma would want us to do.
Mike Michalowicz Official Bio
Mike mi-KAL-o-wits is the author of Profit First, Clockwork, Surge, The Pumpkin Plan, and his newest release Fix This Next. By his 35th birthday, Mike had founded and sold two companies – one to private equity and another to a Fortune 500. Today he is running his third multi-million dollar venture, Profit First Professionals.
Mike is a former small business columnist for The Wall Street Journal and the former business makeover specialist on MSNBC. Over the years, Mike has traveled the globe speaking with thousands of entrepreneurs, and is here today to share the best of what he has learned.
A hearty welcome to “Grandma’s Wealth Wisdom” with your neighborly hosts, Brandon and Amanda Neely. This is the only podcast that helps you take charge of your cash flow and leverage your assets, simply and sustainably, the way Grandma used to.
Amanda: Welcome to the Grandma's Wealth Wisdom podcast. This is an episode with Mike Michalowicz. Really excited to welcome him to the podcast. Let me give you his official bio here.
Mike Michalowicz. You can look how to spell that in the intro or the title of this episode, but he's the author of Profit First, Clockwork, The Pumpkin Plan, and his newest release called a Fix This Next. Try to say that five times fast. By his 35th birthday, Mike had founded and sold two companies, one to a private equity firm and another to a fortune 500 company. Today, he is running his third multimillion-dollar venture, Profit First Professionals. [01:13.6]
Mike is a former small business columnist for the Wall Street Journal and the former business make-over specialist on MSNBC. Over the years, Mike has traveled the globe, speaking with thousands of entrepreneurs, and he's here with us today to share the best of what he has learned.
Before we welcome him, I think Brandon wants to tell a quick story.
Brandon: The first thing I want to say is we are actually Profit First Professionals now.
Amanda: Got the shirts. It’s official.
Brandon: Yep, it’s official. We did this because it goes well with what we do with Grandma's Wealth Wisdom, for sure, and we did it because of knowing what's happening economically in the world, and so we decided, hey, we need to learn it. We need to teach others the system that's worked for us. [02:05.2]
Amanda: It’s like everything with Grandma's Wealth Wisdom. We take what we are learning about, and we see working for us and for other individuals, and we share that message with the world. Profit First, before Brandon tells the story, how we got the book, I heard about it the first time on a podcast, just like you're listening to today, and thought, Oh, I listened to the podcast. I know what to do. I'll just figure it out. And then, Brandon will take the story from there.
Brandon: Amanda, of course, she thinks she knows all of that. I listened to the book Profit First on Audible and I was like, Oh, this is a really good book. I like profit. I want that. And as a business owner, I never really experienced it when we owned our coffee shop as much. Even paying ourselves was a hard thing, and, again, we share that in previous stories. But I listened to this book and I was like, Oh my gosh, why didn't we do this? Why didn't we know about this? We should have implemented this when we started our business. However, it wasn't written yet. [03:06.7]
Anyway, I listened to the book. I was listening to the podcast that they have and they say, If you write a review, you can get a free copy of the book, and I was like, Hey, I can get a free copy of the book. I'll write a review. And so, I wrote a review, got it in the mail, and it was around Christmas time, right? So, I gave Amanda the book as a Christmas gift and I didn't have to pay for it at all. Nothing. I didn't even have to pay for shipping, got the book for free and Amanda got a book for Christmas, and that was probably one of her best Christmas gifts and I didn't even have to buy it.
Amanda: Yeah, if you're seeing the video version of this podcast, do you see the book on the shelf right behind Brandon? That is “the” book that he wrapped up under the Christmas tree and I started reading it on Christmas, I think, and I just devoured it. I loved it so much. By New Year’s, I'd read the full thing and we were implementing Profit First, fully starting then and it's totally transformed how we do business. [04:08.2]
So, if you haven't checked out Profit First, be sure to do that. If you'd like a Profit First Professional to help guide you through how to implement Profit First in your business, think of us as your guides. We'd love to talk with you of what that's like. We'll share at the end of the episode, how to get us as your guide on that journey, but for now we want to make sure that you get the amazing value that Mike brings in what he has to share with us today. Join us in welcoming “the” one and only Mike Michalowicz.
Welcome, Mike. Glad to have you here.
Mike: Thank you, Amanda. Brandon, thank you so much for having me.
Amanda: Yeah, we're going to jump right in. We all know COVID-19 is here. It's not going anywhere. Your mission is to end entrepreneurial poverty. There's a big risk of entrepreneurial poverty actually increasing during this time.
Brandon: Poverty in general, I would think.
Amanda: Yeah, but especially for entrepreneurs, small business owners. What are you seeing some entrepreneurs do that are the best practices that you want to make sure others know about? [05:07.8]
Mike: Yeah, there's definitely some things to do. I’ve just got to show you, by the way, for anyone watching the video, that's how much I believe that I got it all worked out, how to eradicate entrepreneurial poverty. It's just it's a life's mission. Yeah, this COVID crisis, of course, pushes some entrepreneurs to the extreme and I'll give you from a Profit First context what to do.
Some people ask me, Should I start reducing my Profit First percentages, maybe in some circumstances increase it? How should I adjust that? And my answer is don't do either. The goal with Profit First is to sustain your percentages and let the business speak to you.
Say, I'm running a 10% profit. Of every deposit that comes in, 10% is going toward profit, and I continue to do that. That means the OpEx is still being funded the same way. If you see decreasing cash in your OpEx, that's an indicator that expenses are too high and we need to control expenses, or margins aren't present, so we’ve got increased margins. [05:59.0]
If you see a circumstance where you see actually the cash reserves in the OpeEx account increasing, that means we can actually adjust the percentages in favor of profit, but you won't know that if you try to out-think the system. If you try to be one step ahead, you actually start to disarm or kind of numb your ability to be responsive. So, keep the profit percentages the same.
In regards to kind of the external things you can do outside of the Profit First system, immediately look for ways to reinvent your business. You may not need to, but I don't consider this the great recession we had in 2008. I considered this the great reinvention.
There's been such a shift to business, such a shift to consumer perception that things will not go back to the old ways. There's going to be a new way, and the businesses that respond and address a new level of service, a new way of positioning ourselves are the winners.
I've studied now every recession back to the 1929 Great Depression and there's always been a common arc or sequence we go through. [07:04.4]
One of the common key factors is the thriving of small business in a recession, and I'm not saying all small business has a wonderful time, clearly not, but certain small businesses adjust to new demand and become the new juggernauts. The big companies today, they can't shift. They can't change overnight. They're riding cruise ships. We're in jet skis. So, use this as an opportunity to reinvent your industry and you can become the dominant force.
Amanda: Awesome. I love that. The first part of that is kind of like there's a formula, and if you try to adjust the variables, you throw the whole formula out of whack with Profit First.
Amanda: And then, if you have a small, neat formula that's able to be adjusted, you can adjust the things, like you see the X factor is changing, you can change that in a certain way, rather than play with the whole formula.
Mike: Right, so the foundational financial system stays static, and then you start adjusting and addressing the external factors, and it may force you to address your financial structure internally. [08:08.1]
I don't just preach this stuff. I live by this. I consider myself ground zero for Profit First. I started this 12 years ago for myself and we sustained our percentages. We then started asking our customer base. I'm an author first and I also am a cofounder Profit First Professionals. I'm an author, so I reached out to my readership right when the COVID crisis became instilled when we were going through shutdowns and so forth in mid-March.
I reached out to my readership and said, “What do you need from me now?” expecting it to be like write a book on this business tip or create videos on that. But what the feedback was from most entrepreneurs was “My confidence is shaken. I need confidence,” and so that was a realization, Oh, I need to create informational products, if you will, like books and so forth, that help entrepreneurs achieve confidence. I actually even created a thing called the Confidence Course and I'm not like a self-help guy whatsoever, but I created it because that's what my customer base was asking. [09:04.3]
That's what I mean by these shifts. These aren't necessarily grand swings. I'm still staying within a core competency of teaching in this case, but just to the flavor that people need it now.
Brandon: You sent us this in the mail.
Mike: Oh yeah, you got Recessions Response. Yeah, that's part of it.
Brandon: And were you planning on writing this in January just before…?
Mike: No, in February or March 14, but March 15 hits and people say “I need confidence.” We're tiny here. Cumulatively, we have 12 employees. In this specific space, there are six of us, not actively because of COVID. We're all remote, but in our office there are six of us.
And so, we had a team meeting when we could still meet and said, “This is what people are saying. How do we respond?” and one of our team members here—her name is Jenna—said, “What's our recession response plan? I was like, Oh my gosh, that's it, recession response.
So, we created an online version of that because online you can roll out instantly. We can also measure engagement. And that was just exploding, at least for our category. Of all the things we do, that was the most in demand and Jenna said, “Let's make a product that we can sell.” [0:10:06.2]
So, we seeded the market, if you will. We sent out a couple thousand of those Recession Response plans, and now, as we hoped for, we're getting inbound inquiries saying, Hey, can I buy copies? Can I distribute these? Is there an ongoing subscription? So, that was a great way to test out if that is a good confidence builder and, hopefully, it's going to do it.
Amanda: What does seem like perfect timing is your new book, Fix This Next, and particularly, we've read the Audible or listened to the Audible version.
Mike: That’s what I thought. How did you like the Audible?
Amanda: Loved it, loved it. I'm a big Audible fan.
Mike: Me too.
Amanda: And I love the business hierarchy of needs, especially then seeing it visual and having that tie into the book. I did have to see it visually to help that out. But it seems like that idea, it's kind of a stability pyramid, right? It's a very stable way to think about your business with this hierarchy of needs. I imagine that's bringing a lot of stability to businesses right now in such an unstable world. Are you seeing that from the response? [11:04.2]
Mike: Yes. I'm really lucky and part of the luck by design is that I invite readers or listeners of my books, reach out to me. I'll get it. I'll check out the message. I now actually have set up a system. We get so many messages. We're getting one every 20 minutes on average, so three or four an hour, so that means there are 60, 70 emails a day of readers reaching out, and with that wonderful feedback is how people are feeling about it.
The business hierarchy of needs is the internal DNA, if you will, for a business. It's the genetic code, just like 99.9% of all humanity is identical and we all have the same genetic code. We just judge each other on the outside factors of voice, gender, skin color. In business, we judge business on the external factors, Oh, you're a manufacturer. I'm an accountant. Oh, you're an accountant. I own a pizza shop. We're so different. But when you look at the genetic code of business and 99.9% of the same, so I said, “Let's unwind this code and have a representation of it.” [12:01.8]
That became the business hierarchy of needs. It's the five levels of needs, and what it does and within the five levels, there's what's called core needs. Basically, the code has 25 elements, but what it allows business owners to do is pinpoint, Oh, this is where I am right now in this moment, to focus on one thing, where traditionally business owners focus on nothing. It's this constant rush to do all the apparent issues, which is different than urgent.
Urgent means demanding our time. Apparent is this next thing in front of us. You may come into work with a plan, but once you look at email, there's 99 apparent things you can do, and the stream of questions outside your door and the papers that are stacked up on your desk, so we just keep doing the apparent. It feels good because we're doing stuff, but businesses stay in the cycle of not moving forward.
The business hierarchy of needs is a way to prioritize the true one vital need the business has itself, and if you concentrate your energy there, that's what actually starts moving this business forward permanently and stops that hamster wheel.
Amanda: Yeah, and I imagine of all the things businesses could do to respond to COVID and recession times, that helps people see, What is the way that I should respond and what does my business need right now? [13:11.8]
Mike: That's exactly right. Many of us rely on our gut, our instinct, and my gut says, Oh, everyone's running Facebook ads or not running Facebook ads, and we follow the herd. We’ve got to ramp up our efficiencies in our organization right now. It is so inefficient. The problem is when we trust our gut and don't back it with empirical data, it often fails us.
The irony is in our self-preservation, in our personal lives, our instinct is great. If the three of us went out to dinner like, Hey, let's head back to the hotel at the conference center or whatever, and we decide to take a shortcut down a dark alley, and all of a sudden, we're like, Uh, something doesn't feel right. We’d better trust those instincts, turn around and get out of there. That's our census triggering a gut emotion because we have sight, smell, touch. The thing is our sensory inputs are not connected to our business. We don't see from our business’ vantage point. We can't smell or touch or taste. We're not neurologically wired into our business. [14:06.1]
So our guts are great for self-preservation, not good for business preservation, and that's why we need a simple chart, the business hierarchy of needs, to pinpoint where we are, look at some empirical data, that data within your business to validate it, and then take action. Don't trust your gut alone. It’s dangerous.
Brandon: I like the stability pyramid for us as financial stability. We call it Grandma's 10-10-10 savings rule, and you'd have 10% towards the long term, 10% towards the short term, and 10% towards immediate kind of things.
Mike: Yeah, emergency.
Brandon: And then you live out, and it's kind of like the hierarchy of needs in that, and so I like that stability piece from a personal standpoint. And when you had this come out, I was like, Hey, that's exactly what we do from a personal and it gives something more tangible for the business and saying, How do we build stability in your business and maintain stability? And I feel like a lot of businesses are upside down pyramids, and what we maybe are going to have to say is how do we build these new businesses up and build stability? [15:14.0]
Mike: Yeah. Brandon, I'm going to paraphrase Warren Buffett. This is not his exact quote, but he says something like, when the tide goes out, you see who's swimming naked, and that's what we're experiencing in business. To a point, a lot of businesses had the pyramid upside down. They were saying, I'm all about impact. My community is going to love me. I'm going to build something phenomenal here and they're going to come. I'm going to build a legacy, something that lives on permanently, and the sales will happen and I don’t have to worry about profit. It just comes when you have sales.
So, they were focusing on the things, the three or four steps down the road, without worrying about the 10% for immediate needs, as you were pointing out. And we have to get those elements. We have to get sales and profit into our organization because that’s cash flow. It’s the lifeblood of a business. [15:59.7]
You see right now in this economy… I’m in a little town called Boonton, New Jersey. It's a small town, maybe 5,000 residents. There are quite a few small mom and pop type businesses here, and I can count [them]. I used to count them on one hand, then two. Now it takes all my fingers and all my toes to count how many businesses have gone out of business. They were focused on serving the community and being cool or great. They weren't focused on great finances, and now they're paying the ultimate cost, which means they're out of business.
Grandma always said, “Eat your vegetables. Look both ways before crossing the road. And never risk your financial future on elements of the market you can’t control.” That Grandma, always good for some tried-and-true advice. And although some of her wisdom seems to have skipped a generation, you don't have to be left behind.
Download “Grandma's Top Tips for an Independent Financial Future” absolutely free, when you visit Grandma’sWealthWisdom.com. Don't wait. Get Grandma's best tips today.
Brandon: We used to be a coffee shop, ran a coffee shop and independent owners, and the reason we fell into Profit First is because we were those type people that were all about the legacy and all about taking care of everybody else, and maybe we would pay ourselves hopefully, and we learned we needed to do something different. And Profit First was like, Oh, this is amazing. We shouldn't have done this.
Mike: That’s why I think it's an extreme there.4 I'm so happy you realize that you have to take care of yourself, and there's that saying, put the oxygen mask on you so that you can breathe and put it on somewhere else. I think it's an extreme. I actually now believe it's selfish not to be profitable, because here's what happens if that coffee shop of yours that you had or your business now, or anyone starts focusing on simply legacy and growing an impact and all that stuff and ignores profit.
That will mean there's more and more dependency on them. They're the only free resource, the business owner to the business, which means they have to work harder and longer hours, which also means you're blockading employees from working those jobs.
We are experiencing the highest degree of unemployment since the Great Depression right now, and I think it's shameful that entrepreneurs are working harder at the work, which prevents people that want to work from getting those jobs. [18:13.9]
You see, 7% of the world population are business owners. This is us, Where are the wackos? Where's the whack jobs? We're the ones saying, Oh, I got an idea. Let's do this. It's crazy what we did. Our job is to provide jobs, not to do the work. It's to design the outcome and facilitate other people doing the work. So, it's selfish of us to also do all the work. We have to be profitable. We have to do that, so we can facilitate this vision we have, and it opens up positions for people who just want to work. And the majority of the world just wants a good job. We have to provide that.
Amanda: Yeah. A lot of our listeners are kind of those micro businesses. They have five or less employees, or they're the solo entrepreneur. What advice would you have for them to be able to have that legacy, to have that impact, but to stay focused as well on sales and profit, and running a smart stable business? [19:04.8]
Mike: Yeah, as we said in the beginning, I think it was a great reinvention. I'm a micro business, +6, collectively just 12, so I get it, and we're going through these different stages. The key in this environment is to reinvent and the greatest way to reinvent is to humbly ask your clients or past clients how you can serve them now. If your business has slowed down, the asset you still have is the past clients. They will always be your past clients. Contact them and say, How can I serve you now?
I'll give you an example of how not to do it and I'll use a big juggernaut brand just because it was funny and it has happened to me from this company repeatedly. It's Chevy. I own freaking Chevy. The car is fine and I thought Chevy was fine, and now I'm like, Oh, Chevy is the most annoying company on the planet to me.
I got an email from them right when the COVID crisis was really kicking in in March and it opens up with a worst line you can open up an email communication with. It says, “We're all in this together,” and I'm like, Oh, thank you for placating me. Here we go. [20:09.5]
Then it went on to say, “At Chevy, we care about you,” and I'm like, Bullshit, thank you, except “during this crisis, we have cleaned our facilities and done all these things, and if you are ready to start traveling, we're ready to change your oil.” And I'm thinking, Start traveling? We are on quarantine. You're saying, Oh, Mike, leave your infected city to go to a bigger infected city? Thank you, Chevy.
Then it goes on and says, “Are you ready to buy a new car?” Who's buying a new car right now? It actually did the polar opposite. Maybe a smart decision from the CFO to market into this. Shame on the CMO at Chevy to approve a message like that. So thoughtless, so inconsiderate.
Now, here's the flip side, United Airlines, who, ironically, I'm not a fan of United Airlines. I fly United Airlines because I must—they're my hub—but they did something that really impressed me. They get a +1 where Chevy got a -1. [21:05.4]
United Airlines emails me around the same time and they said, “We hope this message finds you well, but at the same time, we cannot comprehend what you're experiencing.” That was a great opening line to realize that everyone's experienced with the pandemic is different. Some people, it’s business as normal. Some people, it’s frustration. Other people, it's health concerns and harm. United did the right thing in acknowledging they can't acknowledge or know what I'm experiencing. They got my attention.
Then the message was, instead of the diatribe I got from Chevy and 15 paragraphs, this was just one short paragraph. It said, “Like many of our customers, you may not be traveling right now. We simply want you to know for being a past loyal customer, we've extended your loyalty card benefit things for another year or two.” I was like, Hey, thanks United. I didn't have to do anything and they simply took care of me. And the last email said, “If we can serve you in another or new way, please tell us.” That's the way to do it. [22:01.7]
United contacted me again, maybe two, three weeks later and said, “Hey, we see an upcoming flight coming up in this July,” right, when we're recording this. It says, “You may have forgotten to cancel that trip. We want you to realize you get a full refund if you do it, and if you are still taking the trip, we're ready to fly you.” Thanks, United. And “If there's a new way we can serve you, please tell us.”
That's excellent communication and I'm challenging micro enterprise to leverage that knowledge. Reach out to your current or past patrons and say, We can't understand how you're being affected here. We just want you to know we're wishing you well. If there's a new way we can serve, we're open for business in the old way, but we realize you may need us in a new way. If you do need us in a new way, tell us how and we'll do the best to accommodate you. That's the way to communicate in my opinion.
Amanda: Love it. Thank you so much for all the great value you've shared with our podcast audience. We look forward to sending them to MikeMichalowicz.com. We'll tell them how to spell that.
Mike: Yeah, there’s a shortcut now, by the way. You can go to MikeMotorbike.com. That was my nickname in high school. That was my G-rated nickname in high school—there's others—but you can go to MikeMotorbike.com and that's the shortcut to get there. [23:06.1]
Amanda: Awesome, and, of course, checking out the Profit First Nation podcast, or Entrepreneurship Elevated is a great podcast, too.
Brandon: How many podcasts have you got? Your own a few.
Mike: Yes, I’m one of the craziest. The Profit First Nation is hosted by Danielle Mulvey, but I'm the co-host on that show. It's a great way to explore Profit First and the deepest way to really get technical on it.
Entrepreneurship Elevated is the elevation of entrepreneurs. It's exploring ways to grow. And we're just about to retire that show. We did over 350 episodes. It’s ready to be benched and I'm starting a new show called Mike up in Your Business where we're digging deep and tough topics. We talk about racism. We talk about a business that got looted during the civil unrest. We explore stuff that affects entrepreneurs that isn't talked about commonly.
Amanda: Look forward to hearing that.
Mike: Thank you.
Brandon: Anything you want to end with before we [end the interview]?
Mike: Sure. I just want to encourage any of your listeners to take immediate action that will bring permanent profitably through business. Today, right now, you can call or email your bank and get an account set up, and I want you to get a savings account set up and call it profit. [24:11.4]
Starting today, you can take 1% of your income and start allocating it. What happens here is you'll start allocating cash profits to your business. Perhaps for the first time ever, you'll see cash accumulating, and that's not the entire Profit First system. In fact, I've just scratched the surface, but that one little small step, at least, for me, and for 350,000+ businesses now that do it, got them addicted to the Profit First way and making it more profitable ever before. So, no excuse, you can start on that today.
Brandon: Awesome. Cool.
Amanda: Thanks, Mike.
Brandon: Thank you.
Amanda: Okay. Now wasn't that amazing, the information that Mike shared? And there are so many ways to dig in. If you'd like to style, if you like what he's sharing, there are so many different ways to learn more from him, from the numerous books that he shared, from the podcasts he mentioned. I mean, I can't wait for Mike up in Your Business. That sounds like a great podcast that I look forward to listening to. [25:06.2]
I had a couple of really big takeaways from what he shared, but before I share those, Brandon, anything that was a big takeaway for you?
Brandon: I think it's just amazing to have him on our channel and on our podcast, to have somebody who has been through the challenge of entrepreneurship. I see a lot of people, and we talked about this in a previous video, where they teach entrepreneurship, but they actually haven't lived it, or they are entrepreneurs and they're poor.
People think you're so rich because you're an entrepreneur, but yet oftentimes you're the last to get paid, and I really liked what he said about it being a disservice not to be profitable. I think that was huge, and if you're taking jobs away, if you're not setting up that business in a solid way. That was a huge takeaway for me. [26:02.2]
Amanda: Yeah, a couple of things for me. He talked about the great reinvention and it's kind of very similar to what Perry Marshall shared about in our last episode, where he talked about the age of agility, and Perry was saying he thinks there's more black swans coming, right, and that we need to be agile to adjust when those come.
I think Mike just reaffirmed that, calling it the great reinvention, and making sure we've got lean businesses that can pivot, right, that we're on jet skis instead of cruises, that's it. I'm going to use that analogy going forward. I've used the analogy of a charging rhino versus maybe a Chevy. It has been my analogy in the past. A charging rhino has got the blinders on. They keep going in the same direction, no matter what happens, Whereas A well-designed, fuel-efficient car can turn really quickly, even if they're going at 65 miles per hour. [27:00.0]
That speaks to what Mike is talking about with the jet ski versus the cruise ship. Which one can turn and be agile, and reinvent themselves most quickly, right? The cruise industry right now versus the jet ski industry right now, I wonder which one is doing better, and then if you take that metaphor and then apply it.
Then, we've used the other thing, the Warren Buffett, when the tide goes out, you see who's been swimming naked, and what businesses have been relying just on their cash flow and living paycheck to paycheck or sale to sale can be really eye-opening during a time like this.
But the biggest thing, my biggest takeaway, is this idea of confidence. I think confidence comes from clarity and what I love about Profit First, what I love, the most recent book, Fix This Next, and seeing that business hierarchy of needs, the BHN, if you want to abbreviate, is that it's all about clarity. [28:02.0]
It's giving you the eyes to see what's really happening. When you are following the Profit First system or using that BHN, the business hierarchy of needs, you get clarity. And guess what that clarity often gives you? Confidence that you're on the right track. You can apply that to having a financial plan on your personal side, too, and having that strategy that should give you the clarity of where you are, where you're going, how you're going to get there, which hopefully will give you tons of confidence that you're on the right track, that you're doing things right, but not so much confidence that you're not willing and able to change and stay humble, and be able to ask your clients, How should I change, right? or be able to ask yourself, Where has my spending gone awry, or where am I investing where I should be saving? and stuff like that, too.
There are a lot of nice [takeaways]. If you want to go deep into it, you totally can.
Brandon: I think, again, that whole confidence thing and having confidence, if you have a stable financial pyramid in your personal life, if you have that in your business, you are going to be able to… [29:10.9]
Again, confidence is going to probably breed more money. If you have confidence, the people that make money are usually the ones that say, Hey, I'm good. I'm solid, because they are good and they're solid, but also humility to be able to cut expenses, make sure you're making those decisions, and if you have that roadmap set forth, you're able to pivot and change. Again, going back to that previous episode, too, it was very similar where he was saying having confidence in your calling and your business is going to breed a creation of prep. We're going to solve problems. We're going to do a lot of other things.
That was one of the things I think was very interesting that these guys should both have coffee together I think.
Amanda: They totally should. I hope, Perry and Mike, that you all meet and get to talk shop and become best friends, because both of these guys have been huge sources of inspiration to us and we're really excited to share them with you, our listeners. [30:14.1]
A couple of things to wrap up here. We've got more interviews coming your way. They might not be the biggest names around, but they do have some of the best information to share with you. So stay tuned for more from our summer of interviews.
If you want to learn more about Profit First and you want to, maybe you’ve looked into it before, but you're like, I don't know if this could work for me, or maybe you're hearing about it for the first time and you're kind of curious but you're also skeptical that this is just another scheme, maybe it's a pyramid scheme because we haven't been talking about pyramids, or maybe it's just another one of those fads that's going to die out in a few years, we're here to tell you that we don't think that's true, that we think this is a system that can work for any business. [31:02.7]
Because it's adaptable, it is a formula that you can smartly and strategically change that formula for your business, and we'd love to help you figure out the right way to do that.
So, if you're at all interested in checking that out, figuring out if Profit First is right for you or if you think maybe it's right for you and you want some additional help implementing it, go to Grandma'sWealthWisdom.com/Profit and you can find out all kinds of details there about how we're helping people to Profit First from their business and increase their profitability through the Profit First strategy
I think that's it. Go ahead. Start doing that 1% shift to savings that Mike shared. If you do nothing else, just do that, and you'll see how revolutionary that simple shift can become.
In the meantime, we hope that you break through to a smart, stable, financial future, using the time-tested wisdom from the greatest generation. [32:06.5]
The topics presented in this podcast are for general information only and not for the purposes of providing legal, accounting or investment advice. On such matters, please consult a professional who knows your specific situation.
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