 Take it after me everybody, Tom Stewart here. Our guest host today is Diana Henley filling in for Liz and our guest today is Diné Wolfe with the Chic CFO, I guess it's the name of your company. Yep. And you're like a virtual CFO, you do accounting for all kinds of service businesses and you got a number of house cleaning businesses that you work with. Yes, we actually this year started exclusively working with house cleaning businesses. Exclusively, okay, that's cool. I like that because we do the same thing. Oh, awesome. Not accounting, not accounting, but maybe a lot of trading, consulting and have a software product and it's all in the residential cleaning world. Kind of feel that we can do a better job if we just focus on that one industry rather than trying to solve all the world's problems. Totally agree with that. Neishing down. Yeah. You guys know the internet was messed up today? There was like a major DNS issue that a lot of platforms were like QuickBooks Online for instance. I told you guys to close that on, I had to clear all my cookies today because I was having a QBO problem. I didn't know that was, I thought it was just me. That wasn't QuickBooks and that wasn't just you, that was the internet. No. Oh, great. At the end of the day, you know, is it like, you know, like Amazon Web Services like a big failure last week? I don't know what the root causes are, but like DoorDash was down and a lot of people were freaking out because they couldn't get their food and this was brought to my attention because Made Central wasn't working right for a lot of people. And when that happened, I tend to find out about it. I tend to hear about it. Yeah. Tom, Tom, Tom. Yeah, and you know, sometimes it's something that, you know, we did or didn't do, but this time it was just kind of the internet gods were missing at the next level. When DoorDash is down, you know, we got a problem. Yeah. That's been happening a lot lately, I feel like. It was a really big deal in Amazon Web Services was down last week. That was a big deal. I didn't even notice that. Sorry. And there was, I don't think the final chapter of that story has been written yet, but anyway, there are a lot of stuff, a lot of weird stuff happening on the internet here. So let's keep our fingers crossed. That's in our rear view mirror. So we've been doing budgeting and planning and Diana, I know that you're a big budgeter and planner. You've been working hard on that this month. Yes, we are. I'm actually a huge, I've always used a budget in my personal life. I'm a huge fan. It makes me feel so much more comfortable. Yeah. So we are, we're working on next year's budget right now just kind of trying to increase our profitability. So it's going well, it's going well. Everybody's in on it, the office staff and the managers and looking at everybody's budget for everything. And I was just informed that my flight to Fort Collins needs to be paid for by my miles and not my, because it's not. Yeah. Okay. All right. But you try to keep those miles for fun stuff. Well, it's the business card. So yeah, yeah, apparently I used that part of my budget for Las Vegas when we were at the convention. So, yeah, yeah. Was that travel or casinos? No, that's just travel. That's just travel. I'm not, you know, I'm not a casino fan. So I did none of that. So Danae, you must be really busy this time of year with all the work that you're doing for cleaning businesses. Is this a busy time of year for you? So historically, it absolutely is. And I, my big word of 2021 was time and really starting to put more value on my time as opposed to money and trying to find that happy balance. So this is the first year my entire team has off starting on Monday for two weeks because I think we just all need, it gets so crazy starting like January one. So we're just saying time out. We're gonna take two weeks, just be with our families, really be present because I know what's in store. But every year it's just, it's a crazy, crazy time. And this is our first year seeing if we take that kind of debrief and relax, will we have a more successful season? Cause last year it just felt like, like you couldn't, you didn't have time to breathe. So we're trying that this year. So I've got a couple of questions for you. One, I didn't know you had the team. I was kind of just assuming you were a solopreneur. So tell us about your team. So 2021, my word was time. So that was a big focus was building out SOPs. I had SOPs, but I made the mistake of writing them in my language, if that makes sense. So like if somebody else went in that like, they'd be like, oh, this is the same as what Kelly does. Well, they don't know what that means. So I rebuilt the SOPs so that they were turnkey. And I went all through first quarter, just trial and error with different people. And then I would say by about second quarter of this year, I was finally like, okay, I've got the right people. And we sent a video update to all of my clients, letting them know about the transition. Like you might send an email and the response might be from Rachel or you might get a response from advocate. Like you might, it might not be me. So we let everybody know about that change. And that's really been the focus of this year is bringing those people on. And as you guys, I'm sure know in the cleaning industry, staffing is one of the biggest challenges entrepreneurs face. Whole lot of trial and error. But I think right now we're in a good place with team. Awesome. Awesome. And the other part is you take two weeks off to spend just with your family, two full- This is the first year. Right. Yeah, this is the first year we're doing that. Cause you know, I don't know your guys' experience, but COVID really was that moment of, am I gonna Netflix and chill the whole time? Or am I going to really turn it up? And here like I turned it up, I read the PPP thing. I read like, I just did a lot. And it was just kind of that mad dash of, how do we not lose everything? Cause I mean, I felt like I woke up and all of my clients were gone cause all their business, it was just crazy. So I felt like I lost a lot on time in 2020. And in 21, that was just my total focus. And I had heard a lot of entrepreneurs saying we closed down at the end of the year for one to two weeks. And I've always wanted to try it. I said, well, we're going to try it. I might regret it next year at this time. I might tell you guys, don't do that. But hopefully it's good. The team is really excited. I'm excited. And hopefully our clients are supportive of it. And there's really not any emergencies in accounting. So I can't imagine that there would be a problem though. You just never know, you know, you bounce a check or something. And my goodness, what happened? I mean, maybe. Yeah, yeah. So they have two whole weeks with just your family being the focus. That sounds, I don't know. That's scary to me. Two days. It sounds fabulous to me. I love that. I love that idea. I think that's- Yeah, my husband took one of the weeks off. So he doesn't have, he doesn't have two weeks, but he'll be off for one of the weeks. And then my kids have school for half of the first week. So I really just have a week and a half, but I'll have like three days right before Christmas. Just, you know, to do all the mom stuff, play the elf and, you know, make sure everything's all good for that. Hey, Diane. You can see it's been a while. Oh, I know her. Hi, she's in my group. Oh, cool. So tell us a little bit about how you got to be a virtual CFO, what path have you taken to get to this point? Yeah, so this actually is all gonna tie into budgets, which is great. So I started my entrepreneurial journey. I graduated from college. Hi, Kelly. Oh, I love Cali. Kelly is fab. You guys have to have her on the show. She owns a cleaning business. So I started my entrepreneurial journey by opening up a franchise restaurant. I don't know what I was thinking, but I did that. And it was- What type of restaurant, what brand? The Primo Hoguees. If you guys are on the East Coast, you actually, I think there is one down in Charleston. I think so. I've heard of one. Yeah. So I opened that up and I really lost my shirt on it like it was not a good experience. I was working all the time. I was so broke. I didn't even know you could be that broke. I didn't know a bank account could go into the negative. Like I just didn't know. And I had to take out a loan because I ran out of the money from the first loan and I didn't have books. So I had, and I couldn't afford an accountant. So I had to teach myself quick books and teach myself how to make P&Ls and balance sheets and all of that. And in doing that, it was like all the problems jumped off the page at me. And somebody within the franchise had said something like, well, no wonder you're not making any money. Look at your food costs. And I was like, what? Like, what do you mean? And he's like, well, they're only supposed to be 33. And I was like, what? Like I didn't even ever think about that. Mine were 56. So then I'm like, wait, what are the other numbers and my payroll was like 30 something. And he was like, payroll's supposed to be 18. And it was like all of a sudden the puzzle was getting put together for me. And I was like, oh my goodness. And I went in and changed everything to be to the industry standard budgets. And all of a sudden I was profitable, didn't change revenue at all, was working less because I wasn't such a crazy person feeling like I had to be in there seven days a week because I think in my naive mind, I was like, well, we're losing money because I'm not working enough. So I'll just be there seven days a week, which wasn't the solution. I was working in the business. I needed to be working on it, but I didn't know that. So I went through this whole journey of just understanding small business accounting and getting my books in order and literally the roadmap of what I had to do jumped off the page and I completely turned around. We opened up another location, paid cash for it, renovated it in cash. Everything just completely changed. So I just started volunteering to teach it at the Women's Business Center. Every state has a women's business center. And I just went in there and just wanted to kind of share this news. Like you're not gonna believe what I did. I didn't change. To me, I was like, I'm making money, but I didn't change revenue. So they felt like all the messages about becoming profitable or work harder, make more money, get more clients. Well, more clients is more work, which I didn't have like the capacity to handle at that point. So I was just like kind of spreading the news because I thought it was so amazing what had happened. And then little by little people started asking, can I hire you? Can I hire you? And then it just kind of just all happened. I was like, sure, I'll try it. And one client turned into two and three and so on and so forth. And that's where we are today. Awesome. So what happened to the sandwich business? So this is the craziest story. So when I had my second son, like I said, staffing, right? The man, at this point, we had a regional manager overseeing both locations. When Bo was one week old, she quit via text message at nine o'clock at night. And I looked at my husband and this had happened to us when we had the first baby. And at that time we only had one store. So they quit when you're like the worst possible timing. And I looked at my husband at nine o'clock at night and I said, I cannot believe this is happening to me again when I'm supposed to be on maternity leave. Because I knew from first time that means strapping the baby on to you going in there before you even heal. I mean, it's not pretty. And I looked him in the face and I said, I'm gonna sell these businesses. And he was like, what? Like you're hormonal. And I was like, no, I will never do, because I knew we were gonna have more kids. I will never do this to myself again. Like this is the straw that broke the camel's back. I cannot do this to wear to goodness. Got on LinkedIn that night. And I don't go on LinkedIn ever. I just went on LinkedIn. I had literally only had it on my phone because I was on maternity leave. So I was bored like who's scrolling through. And I went on there and I said, I'm just gonna look at all the people who own my franchise. And I just started looking on their stuff and liking it, whatever you do on there. And some of you reached out immediately who owned another location and said, oh, like nice to meet you. Like I'm brand new to the franchise. I just bought wherever the store was. And no joke said, I'm looking to buy 13 stores. So if you're selling, let me know where I swear. So I'm like, that's too good to be true. That's so weird. So I don't respond because I'm like, who buys 13 stores? And in the morning I called the corporate office and I was like, some wack job is like telling me he's gonna buy 13 stores. And they're like, oh yeah, we know. I'm like, he just got approved for that. He's paying very well, you should meet with him. So that morning I was like, hey, I just talked to Eric like yada, yada, we ended up meeting within two days. We had the meeting set up. We went, spoke for maybe an hour, went to see both stores by the time I pulled into my driveway. I had an all cash offer in writing 30 day clothes. Then he said, you were the only person who came to the meeting with your P&L and balance sheet ready to go. And if your finances are in that type of order, I know that your stores are in that type of order. And boom, they were sold and that was done. There's a lot of lessons to be learned here. A lot of lessons to be learned here. We wanted to buy 13. So I'm sure there were a lot of people that he was interested in it, but he would go to the meetings and they didn't know where the, you can't sell if you don't know what's going on financially in the business. And I told him like, here's the numbers, everything's profitable. I can't deal with the people side of it, but he was so big that he had like a ton of staff that let's say a manager did quit, he wouldn't have to go in. He had people for that. I didn't have people. This is me and my husband and it was a lot of work. Cool. You know, you start off by paying tuition, not knowing what your food cost should be and your labor cost should be. And I think all of us when we're starting out running our businesses or paying tuition, it's just those of us who are able to apply what we learn, use what we're, you know, tuition that we're paying, applying it in a way to build value. And some of us do a better job with that than others that sound like a tube. You certainly did. I think people get comfortable being uncomfortable and they just, we tend to kind of push this idea of paying your dues in the entrepreneurial community. So I think a lot of people think, oh, I just haven't broken even yet. Like if I just do this, if I just, let me hold on longer, let me hold on longer. It's kind of like, listen, if you've been in this and we're going on year three, like something's not working. And I think the numbers are what kind of gets pushed to the side. There's definitely a lot of fun when it comes to dealing with marketing and people want to talk about hiring and training and branding and all the things that are a little bit glamorous and more fun and enjoyable to talk about. But people don't want to sit down and enter in their seats, right? People don't want to do that. And it falls to the wayside. And the problem is everything you need to know about your business is sitting in those bank statements. It literally tells the story of your company, but you've got to read it. You've got to get the books in order and know what's going on. And people just don't do it. It's something they worry about at tax time because there's this idea that I only need a P&L to file my taxes. You need a P&L to run your business so you know what's going on. And that's really where I just, with my live trainings and everything I do each week, I'm just trying to spread that word because I think one of the biggest issues with our society is a lack of financial literacy. And that's why you see such a discrepancy between the wealthy, you know, the haves and the have not, it comes down to education. People don't really know what they should about financial issues going on in their company. Well, you mentioned too that somebody told you the numbers that you were supposed to have that you were way off on. And I think that's what, you know, like Tom, I met Tom years ago, maybe 12 years ago. And I just saw the successful people and thought, and I actually said the words, excuse me, I would like to be friends with y'all. I want to know what you know. And so because those numbers, Tom, I don't know if you remember, I think we met at Atlanta, but I was going around asking everybody what their profit was. And people were telling me 5%, 10%, and I was in tears thinking, what have I done? What have I done? And then I met people that gave me much better numbers and just strive for it. I'm working this hard for that. I know, I'm like, ooh, what have I done? This is a terrible business. But of course it's not a terrible business. It's a great business. You just have to know what your numbers are supposed to be and then push them in line. Right, right. Yeah, definitely a profitable model. Oh yeah. You know, we're gonna be getting to budgeting here in a minute, but you mentioned something earlier. I think it's really important to point out that all of us running our businesses have to file taxes, right? Most of us have a CPA or CPA helping us with that. And that's our world from an accounting standpoint. We think our CPA is doing all the accounting that we need. And most CPAs do a pretty good job of filing taxes for us, but the profit and loss that they provide you is designed to do taxes and really doesn't give you much insight at all as to... Yeah. I did that all the time. Their job is to file the tax return in as little time as possible. They wanna make sure Uncle Sam is happy. They don't give a hoot what you learned about your business through the process. That's not what they do. And I remember early on when my business was drowning, I had to file taxes. And when we went to the meeting, I was like, so what's going on in the business? And I will never forget this man opening up my folder. Cause he's probably like, I don't even know who this client is. I probably just signed up on the tax return. He opened up and he goes, the business spent more money that came in and closed the folder. And I was like, well, that was quite full. Like, what? I'm paying for this? Yeah, I was like, you guys are keeping me. And then I, and I did a training on this recently, like what's the difference between a bookkeeper, a CPA? Like, what are the differences? And I realized, you know, that really is not what he does. His job was to file my tax return. It was not to give me any type of insight that would help me operationally in the business. And that's where us as entrepreneurs, we've got to educate ourselves. Even if you're in a situation where you're outsourcing. So let's say you're, you know, you've hired somebody like me. There's plenty of people who've served this industry specifically. Even if you've hired someone, you still have to have an idea. If we go out to buy a car, we research the cars. You go buy a dishwasher, you research the dishwashers. You don't know anything about dishwashers, but you educate yourselves, you can make an informed decision. And that's a component that's missing. I think even if you're like, I can outsource it, you've got to know a little bit about how this stuff works so that you can even make sure you're bringing the right person on. Because if you can't have an intelligent conversation about how small business accounting works, how do you know what that person you're interviewing is saying is correct? You have to have a little bit of insight just as you would before you make any type of a purchase in your home or personal. You research what it is. Even ladies buying your skincare. All of a sudden we're an expert on retinol because we read a couple of blogs. Like just take the time to read it and you can make informed decisions and make sure you're not just saying yes, yes, yes to whoever you hire. I think that's scary for some people though. Just the idea going on that journey is stressful and just close your eyes and pick somebody and keep your fingers crossed. I hear that a lot, there's fear. There's also, and this was my big thing, the notion of I'm not a numbers person because math was just never anything that I was like stellar at. It was nothing that I excelled in. And it took me a really long time to kind of get over that mindset, sitting at my kitchen table at 2 a.m. because I can't afford a bookkeeper and I have to figure it out myself. And I realized this really isn't math. Like the software does it for you but I think it's just that intimidation of well math isn't my thing or I'm not gonna understand it. And you really can do it. You can do it yourself if that's what makes sense in your business. But the point is it has to get done. Whether you're doing it yourself or you're outsourcing it because you will immediately know why you're not profitable immediately. As soon as you get everything organized. I tell people a lot of times, I know most women, I don't know about men's time, but most women throughout the seasons, we reorganize our closet, right? When you do that, you're like, oh, I didn't wear that this season because I didn't know I had it, right? Something about reorganizing and getting everything set up in the closet. Now you're making smarter decisions when you get dressed in the morning. That simple analogy flows through to your finances. Just simply having it organized and seeing what you have, what you're doing, now we can make smarter decisions. Like what you said, Diana, when you said you used your miles. They told you you had to use your miles. That is exactly what I mean when I say you should be making operational decisions based on what the numbers tell you. That's a prime example. We can't just swipe the card because we have to buy the flight. Obviously your business is organized enough to know that's not in the budget and that's so incredibly powerful. Is developing a budget at the beginning of your part of this process? So what I always tell people is you want to know what is industry standard. So for this, we're gonna speak exclusively for the cleaning business because I know that's your audience. But if you maybe have a different business as well, whatever that is, you wanna know what industry standard is because that's gonna be the best way to really gauge the way that you're performing. So what I see typically is for my cleaning companies, I wanna see 55% going toward our cost of goods. So as a cleaning company, we're gonna have cost of goods of our labor that's gonna include their taxes, right? And then any cleaning supply. Then we're gonna allocate 10% going to our advertising fund, 15% going to our operational costs and 20% to profit. That is the most common, but I have a lot of entrepreneurs who are just really great with organic marketing. So we don't have to put 10% into that marketing. So we're able to get it and shift it into profit. I also have some clients who are just whizzes operationally. So they've got a zap for everything. Things are automated. They're running these really streamlined businesses. So we're able to pull from that 15 as well. But once you know those buckets and you know, hey, at minimum, 20% of everything that comes through the door should be going to me, it should be my profit. It really changes the lens you look at it. And what I will, being very stereotypical, what I typically see in the industry when someone is not hitting 20. Very rarely is it an overspend in marketing. Usually I see that marketing of anything coming in less than the 10% that I recommend. I never see less than a 55 going on in cost of goods. That's very rare. It's usually the operational costs. And the culprit, nine out of 10 times is support staff. That is usually exactly in my experience what I am seeing as one of the number one reasons why somebody's not hitting a 20%. Support staff and having an office space. Those are the two sticklers that I've really found. And when we have our support person, right? Making, you know, three, 4,000 a month but the business hasn't hit that revenue level yet where we can afford that, I usually will get a response. Well, I'm only hitting the revenue level because of what he or she does, right? And the entrepreneur is convinced they need this support person in order to do what they do. And then I will challenge them to say instead of throwing money at the problem, right? Because they think they have an operational problem. If you cannot run your business because one person leaves, you got an operational problem. So instead of throwing money at it by just trying to hire this office person let's actually fix what the issue is and take a look at the operational systems you have in place. You probably don't really have any systems, right? It's probably all living in that person's head and see how you can fix it because then when the business does start to grow the revenue, you're still rock solid operationally because you've got such prime systems in place you're gonna be even more profitable than 20% because that ops spend is gonna be so little. But that's usually what I'm seeing having a facility before they're ready or having support staff before they're ready because I think in this community which is why I love working with cleaning companies so much because it's usually a lot of in again of being stereotypical in my experience it tends to be a lot of people who kind of just thought I'm good at cleaning, I wanna be an entrepreneur I'm just gonna do this so I can have flexibility and be with my kids. It's usually what I hear. And then it's like they kind of wake up and they're building this empire and they're like, whoa and they don't have systems in place because what works at 10 grand a month in revenue isn't gonna work at 30 grand, isn't gonna work at 50 grand you have to change the system and instead of changing the system and building that process in those SOPs they just tend to hire people and just say oh we're getting busier I'm gonna hire someone well let's fix the problem and then we're gonna reduce our labor costs that's usually what I'm seeing happening in the industry. And I guess if you don't have the numbers if you're not, if you don't have a P&L that's structured in the right way you can't even see any of that happening. Yep, one of the first things we do when we onboard a new client is we completely customize the P&L because I wanna make sure that when you look at it what you need to know jumps off at you because let's say somebody comes to me from a different bookkeeper is there are they sending you reports every month? Well yeah but I don't open them well why don't you open them because I don't understand what they are I don't know what it says because it's too generic of a term. So we go in and completely customize it so that you're seeing what you wanna see and it's just that lack of education, right somebody's like well I really wanna see which part of payroll is I don't know the office assistant versus the office manager, right but I know we can't do that. Why couldn't you do that? Of course we can do that it's just a mapping thing in QuickBooks of course we can go in and get that micro the IRS doesn't care, right if it was an office that they don't care but it's not incorrect to have it coded on there if that's what's gonna be beneficial to you and I think just maybe the previous bookkeeper was a little bit I don't wanna use the word lazy but didn't wanna take that pick it up a notch to get more micro with it and that's really what has to happen so that we can make smart decisions as business owners and I'll see if you have office staff, right I'll see a lot of times it's all thrown in cost of goods. So now we think to clean the homes it's 60% I'm like well why are you over why are you over oh all of your admin staff is sitting in there so let's break this down, break it out so we can see what's going on because now when I pull the P&L if I say hey you didn't hit 20% but you spent 4% on office supplies you spent 5% on a marketing campaign, right we're able to have those numbers jump out at us so we can say well if you didn't do this we're gonna get here if you didn't do this we would have gotten this much closer to 20 and in this climate I've had a lot of people even make conscious decisions to lower the 20% because there's something they want to invest in right now with the climate we're in I'm seeing a lot of people say you know what I'm gonna take a 15% cut and I'm investing five into a recruiting marketing campaign because staffing is such an issue so I'm seeing a lot of let's take a smaller profit so that we can invest into recruiting because we need cleaners but a budget rather than people thinking of it constraint, right it's actually freedom because it gives you that ability to sit down and actually manage the money and make those type of strategic decisions like investing into a recruiting ad do you guys mind if I read this question I don't know I just got a question for us here yeah I'm gonna read I think we're talking about employee retention tax credits yeah if you get ERC that mean you cannot use your payroll you cannot use your payroll on your return oh I think she's saying that I think she's saying that payroll doesn't get counted as an expense so you are gonna want to make sure Linda that your bookkeeper is well versed on how to put the ERC on the P&L it can be a little bit of a bear and the IRS guidelines are it took I'm not exaggerating it probably took two or three days and a meeting with like at least three of just my peer like people with their own businesses not people that people on my team trying to figure out the best way to do it but essentially what will happen is your payroll is going to be on your P&L so you are gonna get that expense but you are going to have to report the ERTC as an additional income and you are gonna be taxed and like it's gonna increase your taxable income unlike the PPP which did not increase your taxable income the ERTC will okay but the good news is you're still more profitable than what you would have been without it so oh it was a phenomenal program I have had clients I think the biggest one got like over $200,000 it was an amazing amazing program well I know a lot of people when they're like trying to address their staffing issues focusing on we need to figure out how to hire more people we're not just can't get enough people and I guess there's so many other ways to address that as well though not to say that investing more in recruiting isn't one of them but you know I see people that are maybe missing an opportunity to work on the retention side of it and they might be killing themselves trying to hire two people and there could have been two people that they've hired ten times over that would have stuck around if we were doing something a little bit different after we hire them I mean typically they'll say it costs less to keep someone then to find someone else right but it all really depends on the dynamics I find ever even just where you're located in the country everything is just so kind of specific to the location I have some clients who staffing is just never an issue for them and I'm like what's your secret sauce and they're like I have no idea we just we never we never have an issue everything's fine and then I have some people who are bending over backwards and just cannot find new people but I do not have a lot of situations where I find clients are kind of circling through them usually if somebody's not going to work out in my experience it's happening right away not usually people will get in and stay pretty long but it's like I hired five people how many are gonna last right it's usually that first couple of weeks that it's like they're weeding themselves out but if you've got your financial statement the term of count structure properly and you know budgeted and so forth and if you see that you're spending a lot more in training maybe than what you planned you could figure out that you know your road to profitability isn't necessarily hiring more people it's doing some other things differently just to reduce the number of people that you're having and training is a really good topic so this is not for everyone and I'm aware of that but something that has strictly looking from a numbers perspective right so I can't really speak operationally if it's had negative reviews or anything you know not that I'm aware of that clients have complained but something that anytime I've seen one of my clients implement and I'm a big advocate of it is starting an onboarding process that is almost like an online course so some type of digital certification because I'm a big fan of digital courses I have a digital course it is a one time give it your all make it perfect best certification ever and the person takes it and now you're not in a situation where you're in these training periods that costs a lot of money that's a big thing that now I have to train this many people which means now I have my supervisor is out there and she gets an extra cut because she's training and then you know we can end up with a situation where you clean some houses this week that you actually lost money on right so we have to be really careful with that so one of the things I really if you have the capacity to do it because it's very difficult that the few clients that I've had put the time into creating these online certifications it majorly helps them because the person sits at home they do all of the trainings on the video and it didn't cost you anything so that's something that I've seen a lot of people have luck with but then you know you have some people who are just like I cannot do that I don't have the time still but it's so much work or they're just you know more old school and they want to get out there and you know show them what to do we've got another case of Susan regarding ERC everybody loves this ERC my company out in gusto gusto is awesome do I just wait for a check or do I need to contact gusto so we would have to know when your accountant said he figured it out in gusto so you need to make sure log into I'm going to try to remember this off the top of my head log into gusto go to reports and there is a report that says I want to say it says tax credit history when you log into the dashboard and you hit the reports on the left hand side the report that I'm talking about is down toward the bottom right and it says something along the line of tax history tax credit when you click into it it would show first quarter 2021 da-da-da-da-da 10,000 second quarter did it everything will be there if your accountant properly filed it as long as it's logs in that report it's definitely filed and you're just sitting back and waiting on a check if it is not there it's not filed so as soon as you can see that in gusto then you know gusto filed it and you just sit back and wait too easy too easy awesome big fan of gusto when you're putting your budget together and your plan for the year you know we're talking a lot about the expense side and what the ratio should be any consideration we should give to the revenue side and what we would see our revenue being month over month so this is what I do with cleaning companies and I love going through this exercise so I'm a really big believer in building businesses that can support the life we desire and I think in the entrepreneurial community a lot of times people feel like they're stuck on a hamster wheel and they're not getting anywhere and they just feel overworked, underpaid and not happy and it's because we didn't make sure that the business was aligned with what we actually wanted to do in our lives so what our clients go through whether they are working with us in our virtual CFO services or they're taking our course profit perfect we start with what are the personal goals that you wanna set and in those personal goals we're outlining everything down to like what do you spend on your gym membership each month we wanna know how much does your current life cost you and then you gotta gross that up to account for taxes which we do right in the spreadsheet it'll automatically do it for you but then we wanna say what is your dream life so maybe your car right now costs 300 a month but the dream car you want costs 600 a month and that's how we're gonna get that sort of long and short goal so the minimum is what do we need to currently support our life the long term is what do we need for our dream life this is step one when it comes to setting up revenue because I think too often it is well I wanna be a million dollar business tell me why you wanna be a million dollar business Susan well I just want to okay what's your dream life we go through it all right you only need to do 600,000 in order to do that and it's like they didn't know right so we might be chasing something that isn't even aligned with what we want right because we have to first make sure what do we want if you are chasing something and you don't really know why and you didn't make sure it was aligned with what you wanted you're never gonna feel fulfilled you're not gonna be happy so we start there then once we know what we've gotta do personally right now we're ready to look at the business and say okay so I know that my minimum is X my long term goal is Y where am I currently with revenue so we wanna know where are we on it so let's just say using random number share let's say the minimum I have to do a month is 30,000 in revenue and my dream is 40,000 in revenue right so we're now gonna look and see what are we typically doing if you guys don't have books that's fine you definitely have to have somewhere where you can pull record of sales so whether you're pulling it in the point of sale report or you're literally going through every single bank statement and looking at the total of the deposits right that's crappy figure it out this information is definitely there for you so you have to figure out what do I typically do each month right so if you do the whole year divide by 12 there you go now you know my average sales are 25,000 right and I wanna be at 30 so now what you do because this is something I learned early on in my career when I started working with service-based businesses you have to check your capacity so what you have to do is say all right so I average 25,000 a month in revenue I need to be at 30 at the 25 am I sold out or do I have more capacity now we're looking at the capacity to say okay I'm completely sold out which means that if I wanna get to an extra 5,000 a month how many cleanings is that how many cleaners does that translate to so now you're coming to your team and you're saying we need 30 cleaners on staff at all times we need to do X amount of cleanings each week we need to do X amount of cleanings each day because you're taking that revenue goal first of all based on what your life wants what is that actual desire then you're breaking it down to what does that translate to in words that actually makes sense because you wanna get to a million you wanna get to how are you doing that how many cleaners do you need what does that break down to each week you can't just say to your team I need 30,000 a month in revenue okay in their mind they're gonna go I can't control what your revenue is but when you say we need 30 people on staff at all time we need this many cleanings for today now they've got that satisfaction of saying hey I booked a cleaner today I'm closer to that goal hey I just did this I'm closer to that goal because we've broken it down into goals that make sense for the team so everybody's moving toward that goal and oftentimes when we've just got these revenue goals as an employee that's very difficult to sort of wrap your head around because you're like I don't see the bank statement I can't control that when I was an employee and I was managing somebody's business and I was like I can't control who but once it was well you have to do this many oh that makes sense to me now so that's really how we go through and break it down so that by the end of your goal setting call you shouldn't just say my business needs to do 30 grand a month next year it needs to be this is how many cleanings per day and this is how many cleaners it takes to support it so it's not just a budget I mean that's kind of the beginning but you need a plan to go along with that what are you gonna do in order to make that budget become reality? Exactly, exactly and making sure that budget and that revenue goal was actually based on what you want you would be surprised I most of the time, most of the time go through these scenarios with clients and they need less than what they sort of built up in their head that they needed once we go through and say okay what's your dream life, what are you trying to do? They need less than what they really thought turns out you didn't need to hit this much in revenue Yeah, that would be cool I don't know sometimes I hit a number that I'm shooting for and find out it wasn't as much as I thought it was I mean that can go both ways Yeah, it could for sure, for sure Let's see especially when you're starting out you kind of figure out that okay if I can just hit this number I'm gonna be profitable but what you're not seeing is that in order to get to that number you're gonna have to buy another piece of equipment you're gonna have to take another expense here and before you know it it's like the goalpost moved Yeah We call that the value of despair and it just keeps you until you pop out the other side and then you truly are profitable Yeah Oh, look at this we've got a question here from someone in our audience My husband What he said, I didn't hear what he said That's my husband Oh Yeah, he's the one working on our budget right now Oh, there you go Yeah, so for us we've done everything from you know a client wants to buy a new car to you know a client is bringing on an ops manager and what can they afford Our kind of golden rule for our clients is you don't need to call me if you're at Staples and you wanna buy the pink planner instead of the black but the pink is more but hopefully I've taught you enough to say just take the black but if you are going to make a substantial financial decision especially a recurring one let's talk because I think when somebody wants to hire someone when somebody wants to do a marketing campaign you typically hear, well I don't know what I can afford to pay them well you do if your numbers are organized you will know exactly what you can afford to pay them so we try to to really encourage the clients to reach out to us when you know recently we've had someone who opened up a second location running through all those numbers what you know what makes sense how much can we spend does taking on a loan make sense what does that do to the impacts of the bottom line so we like to run through any type of a big decision with our clients you know that's everybody pays taxes everybody's got you know a CPA or somebody like that everybody does their books to some degree some better than others but you know not many businesses and maybe that's you know hopefully that's changing have somebody that they can really refer to as a CFO somebody that's helping make those financial decisions and properly you're going to have more money in the bank in the end of the year making an investment in a CFO then just kind of going blind and you know I'm going to pontificate for a minute because I really see so much changing in the world right now with inflation going up and for a lot of us we're paying 50% more for labor than we did two years ago and even if we were making money and it was working a couple of years ago it might not be working now we don't even kind of figured it out yet so putting the budget together and having somebody to help with those numbers I think is more important now than it has been in a long long time yeah and the CFO thing is funny I'll tell you guys a little story so like I said I started volunteering right and then people started saying hire me and my response to them was well why why right well I have a bookkeeper but I have no idea what's going on the reports don't make sense to me I don't know what I can afford what I can afford I don't know what I can pay myself and I was on vacation and I was literally laying on the beach and I was listening to like a self-development motivational book and I was thinking it's kind of crazy that everyone is saying the same exact thing and I was like but how could they you know have these bookkeepers but they're not getting the information they need and I was like how do like big companies figure this out and my husband's in finance and he was like well we have a CFO and I was like huh and I googled virtual CFO and there was maybe one or two companies that came up and I went to my husband and I was like I feel like I should do virtual CFO services and he was like what the heck is that and I was like I don't know I think I made it up and I searched Google and I was like if I could do their bookkeeping that's only good for the IRS that's not helping them like they need to know what's going on in their business that is the strategy that I can because I'm like I don't want to sit and do people's books that's not fun I really didn't want to do that and then once I got the analysis on I was like that's the stuff I love that's what I used to volunteer and teach about strategize this if this number is it and when I added that component to it and made it virtual CFO services it just skyrocketed that was the stuff that started making you money in the sandwich that was the secret sauce that was what took it to the took it to the next level don't put that extra piece of cheese on the sandwich we'll never make money that way that's nice how long have you been how long have you had this virtual CFO company so my son I started really taking on clients when I was pregnant with Bo Bo is about three and a half now and then I sold my restaurants when Bo was like one week old so my business was literally like six months old it was such a little thing I remember saying to my husband when we were selling the businesses I was like well the only thing I do that tends to be a bit obnoxious is I have a Sephora addiction so I remember saying to him I'm just going to you know keep my little you know side business that I have going on and it'll pay for my Sephora bill that's it and I just went into like that and I'm like I just work a couple hours a week I've got two babies I don't have the weight of these restaurants anymore and it was just like phone call and I didn't have a social media I didn't have anything like I was just like this is my little side thing and it just kept growing and growing and growing and then the baby got older didn't need me as much and I was like well maybe I'll just have like child care a couple days a week and see what I can do and then it just snowballed snowballed snowballed and I was like okay I think we have surpassed the side hustle thing and then we added because I found a lot of a lot of the people that wanted to work with me were not in a position to have that added on monthly and I and just I cannot be that salesy person in good conscious I cannot preach financial literacy and then try to pay for something that you can't afford I just that's not I cannot do that so I was like I need something to give them right if I go through your numbers and I'm like yeah you can't afford me I needed a DIY option for them and that's how I ended up with the course Profit Perfect so it's a one time fee which anybody can afford a one time fee and that really helped us scale to a new place and now we've got a team and we're gonna close for two weeks and hopefully it doesn't implode you know we are getting to the top of the hour here and this is really a good segue right awesome oh yes Profit Plan so this is something that I put together that'll really just kind of help you go in to start planning and budgeting and getting yourself prepared for next year it's completely free just go ahead and download it right on this page where it says download your free profit plan and it has a video on it so it'll kind of walk you through how to do it and how to answer the questions so I took the link and dropped it in chat if you want to go here oh yeah perfect oh this is cool mm-hmm oh yeah and that's what it looks like yeah so if you guys want to download that that's completely free and then if you come on over to the Profit Factor Facebook group I do live trainings every single week all related to financial literacy clarity you know what can we do to educate ourselves so that we can really start running profitable businesses because I just think if you for entrepreneur like I just find us to have the entrepreneurial spirit to me is unbelievable and I think if we know how to like harness our power correctly we're unstoppable and I think just there's those learning curves and my mission is to just break it down in words that makes sense a lot the feedback I get is oh well I tried this group or I tried this course and I look into it and I'm like well that person's a CPA so this person decided to study accounting for a living and now they're trying to educate small business owners when they've never run a business in their life so I tell people you know I didn't learn this in accounting school I learned it in the trenches taking grenades holding an eviction notice so my perspective on numbers and small business accounting is going to be drastically different than somebody who studied this in school not to knock somebody who studied in school that's great celebrate that absolutely I'm glad you got your CPA but at the end of the day there is going to be a big difference between somebody who went to school and got this certification the way they're explaining it versus someone who's an entrepreneur just like you and just wants to teach you how to be profitable so that's really what I try to do and just make a safe space where there's no stupid questions and we'll figure it out together having lived it gives you a different perspective oh for sure for sure I know all about it and somebody is going to call out tomorrow and you know and my payroll going to bounce in the morning oh my gosh I'm going to get out of bed and before I do anything with one I open I'm going to log on to the bank account because I'm stressed out I've been there I completely got it awesome well you guys have been great Diana thank you for your help and in pitch hitting for Liz today Diney thank you for sharing with us this is good information and I think the whole idea of a virtual CFO is really makes a lot of sense for a lot of businesses and I think that's kind of a concept that you know more cleaning businesses need to at least be aware of and throw in the consideration set so thank you for being with us and sharing thank you guys for having me I appreciate it we are done for the week this is Wednesday afternoon we're kind of winding down here towards the holidays but we're going to be back next week we're going to be here Monday five o'clock eastern for more smart business so till then we're good Diney Diana both thank you again and we'll see you here Monday five o'clock eastern bye guys