As a business owner, understanding your own role in the company is crucial. It isn’t just about managing day-to-day tasks, it’s about financial responsibility. Recently, Mike Disney, CEO of CEO Warrior, and I discussed the importance of being disciplined in monitoring numbers and job costing. It’s about embracing the highest and best use of time to prevent profit leaks. Truly, understanding your business’s identity can lead to profitability.
In this episode we discussed:
- Understanding profit leaks in home service businesses
- Importance of financial responsibility and monitoring numbers
- Defining roles and focusing on the highest and best use of time
- Planning for profit and not treating it as an afterthought
- Overcoming the misconception that profit is bad or greedy
- Mindset and its impact on pricing services
- Avoiding assumptions about customers’ affordability
- Importance of systems and processes for success and profitability
- Partnering with a financial person or accountant
- Taking action, avoiding complacency, and having a sense of urgency in business
The key moments in this episode are:
- [00:02:15] -Finding Profit Leaks in Home Service Businesses
- [00:04:48] – The Importance of Daily Financial Management
- [00:09:39] – Building Profitability and Planning for the Future
- [00:10:43] – The importance of mindset in entrepreneurship
- [00:11:38] – Challenging beliefs about pricing
- [00:14:53] – The significance of financial management in business
- [00:21:05] – Importance of having a relationship with financial professionals and understanding the impact of finances on business.
- [00:23:47] – Transitioning from working in the field to becoming a CEO and the importance of war planning and budgeting.
- [00:27:31] – The importance of consistent planning and discipline in order to achieve desired net profit and business growth.
- [00:31:12] – Discussion on the group of people who are content with just buying themselves a job and the need for daily exercises to become successful.
- [00:31:33] – Exploration of the negative effects of complacency in today’s world, the potential positive impact of growing a business, and the importance of a sense of urgency and desired outcomes.
- [00:33:15] – Sacrifices and financial acumen in business
“None of us went into business to lose money and none of us want to have the inherent risk and…you have to have a reward for that.” Mike Disney
The Importance of Understanding Your Business
Mike emphasized the importance of understanding the true identity of a business and the financial responsibility that comes with it. He pointed out that many business owners lack discipline in monitoring their numbers and job costing, which often leads to profit leaks.
He suggested that defining one’s role in the business and focusing on the highest and best use of time can be the most profitable thing for a business. I couldn’t agree more. I’ve seen firsthand how measuring numbers, paying attention, and staying focused on the financial aspects of the business on a daily basis is crucial.
Planning for Profit
It is important to plan for profit and not treat it as an afterthought. I shared an example of a coaching member who was surprised to learn that they could plan for the amount of profit they wanted to have.
We also tackled the misconception that profit is bad or greedy, which some business owners may have due to their upbringing. Mike believes that being profitable allows businesses to give back to the community and hire more.
The Mindset of Pricing
We delved into the importance of mindset and how it can impact a business owner’s ability to charge what they’re worth. Mike suggested that when faced with doubts about charging higher prices, business owners should ask themselves, “What if that’s not true?” He emphasized that every business is different and has its own unique needs, resources, and overhead costs, which should be taken into account when determining pricing.
I advise my clients to focus on quoting their prices confidently and without assuming what their customers can afford. Mike added that business owners should avoid putting themselves in their clients’ shoes too much, as it can lead to distractions and judgments that hinder profitability.
The Role of Systems and Processes
We both stressed the importance of having systems and processes in place to ensure the success and profitability of a business. Mike highlighted the need for timely and accurate financial reporting, as well as understanding and analyzing financial statements like cash flow statements and balance sheets.
The Power of Partnership
Mike emphasized the importance of having a partner, such as a financial person or accountant, to help manage and understand the financial aspects of a business. He believes that this partnership is not just an expense, but an investment in the success of the business.
From Field Worker to CEO
Mike also discussed the transition from being a field worker to becoming a CEO and the need to spend time in the office to understand financial strategies. He highlighted the significance of budgeting and war planning, which involves setting goals and creating a budget based on historical data.
About Mike Disney
Mike Disney is a co-owner and the COO for CEO Warrior, where he leads the large and growing company as a trainer and subject matter expert. Early in his career, Disney was an automotive electrical specialist before joining Gold Medal Service in 2013 as a lead generator. Disney accelerated through the company to director of sales and had a key role in the sales successes, including their highest recorded sales month ever at $3.5 Million. He joined CEO Warrior as a master coach in 2015 and became COO in 2019. CEO Warrior is a business consulting, training and mentoring firm, that provides tested and proven methods to defeat the roadblocks that prevent small to mid-sized businesses from achieving their ultimate success.
Mike Disney joined Mike and Rob’s service company as a Lead Generator, and he quickly proved his skill at growing the business. Mike accelerated through the company to Director of Sales, where he managed outside sales teams, the outbound department, and relationships with national retail chains. Mike played a part in every function at the service company and had a key role in the sales successes, including their highest recorded sales month ever at $3.5 Million. After Mike and Rob exited their service company to focus exclusively on serving business owners at CEO Warrior, Mike joined them as the Director of CEO Warrior. Today, Mike leads the large and growing CEO Warrior team as the COO and a Co-Owner.
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