Building Wealth: A Deep Dive into Profit First Implementation
The primary focus of this podcast episode revolves around the transformative impact of the Profit First methodology on a client's business trajectory.
We explore an illustrative success story, wherein a client, initially generating a revenue of a £250k, has grown her business to a projected £2.5m, all while managing an impressive 35 bank accounts.
This case exemplifies the profound clarity and financial control that the Profit First system affords its users. Our discussion delves into the importance of having a structured financial framework, which empowers business owners to make informed decisions and seize opportunities that may arise unexpectedly. Ultimately, we underscore the notion that consistent application of the Profit First principles fosters not only business growth but also personal fulfilment and financial security for entrepreneurs.
Takeaways:
- In this podcast episode, we explored the transformative impact of the Profit First system on business owners' financial management strategies, highlighting its ability to foster growth and sustainability.
- We discussed a remarkable success story of a client who, through diligent implementation of Profit First, significantly expanded her business from £250k to over £2.5m in annual revenue.
- One of the most compelling insights shared was the importance of having multiple bank accounts to facilitate financial clarity and purposeful allocation of resources for both business and personal projects.
- The conversation emphasized the value of community support and guidance in successfully navigating the Profit First implementation journey, which has proven to be a game changer for many businesses.
Links referenced in this episode:
- profitfirstuk.co.uk
- facebook.com/groups/croissantscoffeeprofitfirst
Companies mentioned in this episode:
- Profit First Professionals UK and Ireland
- Profit First Professionals
Transcript
Foreign.
Speaker B:Welcome to Profit first beyond the Book, a podcast that takes you beyond the book with Profit first brought to you by Tim Duncan and the rest of the Profit first professionals UK and Ireland.
Speaker B:Hello, Jason, how are you?
Speaker A:I'm great, Tim, how are you today?
Speaker B:I'm very well, thank you.
Speaker B:So, as you can see with us today, we have Jason with us.
Speaker B:Jason is not only a Profit first professional and a Profit first coach in his own right, he's also our main Profit first professional guide.
Speaker B:So when our members join us and they come onto their new cohort and they come onto a call with us, they are very often confronted with Jason's very friendly face and lots of enthusiasm as he looks forward to guiding people on their Profit first journey.
Speaker B:So, Jason, welcome along.
Speaker B:Have I introduced you correctly?
Speaker B:Is there anything you want to add to that?
Speaker A:Fantastic.
Speaker A:Now I'm leaving it to you, Tim.
Speaker A:Great job.
Speaker B:Perfect.
Speaker B:Perfect.
Speaker B:Well, look, thanks for joining me today on the podcast Profit first beyond the Book.
Speaker B:And as you know, we're doing this, we're inviting our members along and we're trying to encourage people to come along to talk about Profit first and all the strategies that you just can't learn from the book.
Speaker B:And I think it'd be really nice place to start with.
Speaker B:Before we talk about your journey, I'd love to hear a really success story from one of your clients.
Speaker B:Is there anything you could share with us to just start the podcast, whole episode off, please?
Speaker A:Sure, no problem at all.
Speaker A:So I will talk about a client and within that I'm going to dispel one of the great Profit first myths about Isn't five bank accounts an awful lot?
Speaker A:For those that have read the book, you're obviously familiar with the basic five account structure.
Speaker A:This particular client has grown the business.
Speaker A:We've been working together for about five years or so.
Speaker A:Roundabout sort of COVID times was when we started working together and she had a business that was doing about quarter of a million a year.
Speaker A:She will breeze through two and a half million this year.
Speaker A:Amazing growth within the business.
Speaker A:But she now runs about 35 bank accounts.
Speaker A:She has totally taken the ethos of the Profit first piece.
Speaker A:Breaking down, having clarity around the money that we actually have, what its purpose is, and so on really to the nth degree.
Speaker A:Now, in fairness, a lot of those accounts actually relate to elements of her personal life.
Speaker A:She has a house that she's redeveloping, so she's basically opening up bank accounts, all the different types of renovation work that she wants to do.
Speaker A:So she probably runs about 10 to 12 accounts for the business and then there's probably some in the region of 20 accounts I guess that cover off that private part of her life.
Speaker A:But I think one of the greatest achievements that she's got to literally in the first part of this year is she's about to embark on purchasing her first set of premises.
Speaker A:So over the course of this period of time, obviously you know, growth quarter of a million to two and a half million in five years is a pretty steep growth curve.
Speaker A:But she has just got herself into the position of being able to put down an almost 200,000 pound deposit through accumulated funds over a period of time.
Speaker A:And I think one of the things that this does is it reminds us we don't always know what's coming up in the future.
Speaker A:But by having a process and a framework to follow, it gives us the opportunity to take advantage of these things when they crop up and know that we have money set aside ready to deal with some of these bigger business decisions that we come across.
Speaker A:It's a no brainer.
Speaker A:There's no can I afford it?
Speaker A:The money is already sat in a series of bank accounts.
Speaker A:To be fair, we're going to pull a few together to actually make that deposit payment.
Speaker A:But the process has been the process and a very consistent process for her across this period of time, not an overnight fix.
Speaker A:It has accumulated over a period of time by repetitive habit and behavior.
Speaker A:Following the framework, following the system, we, we run contingency accounts for a number of things for her wages and operating expenses already in the business.
Speaker A:This truly is money that is available to make these big decisions in a, in a very stress free way.
Speaker B:That's, that's amazing.
Speaker B:35 accounts.
Speaker B:I mean we, we talk about the, the standard profit first accounts, the you see in the book.
Speaker B:And that's like taking it to a complete another level, isn't it?
Speaker B:Is.
Speaker B:Can I ask, did, did these accounts get opened in one go at the beginning or did this happen over a period of time?
Speaker A:Ah, this takes us back to one of my all time favorite maxims actually from Is it a maxim?
Speaker A:I'm not sure.
Speaker A:I have to be careful about using that word in the way that Mike talks about maxims in the book.
Speaker A:One of the themes that came through early on in my profit first journey was the idea if in doubt, open an account.
Speaker A:So these accounts have basically accumulated across the period of time that we've been working together as and when we need account to deliver on a specific purpose either for the business or for her in her private Life, she opens another account.
Speaker A:She banks with a high street bank, uses savings accounts for most of these accounts, to be fair, keeps it simple and straightforward for her within one banking environment.
Speaker A:But yes, over time, as required.
Speaker A:And yeah, beyond those standard accounts, sometimes the accounts run forever, as it were, sometimes they have shorter term purposes attached to them.
Speaker A:But yeah, if in doubt, open an account.
Speaker A:And she does.
Speaker B:Yeah, I've heard that saying quite a lot from the US Profit first professional guides, actually, which is really interesting and, and it's a very good mantra to follow.
Speaker B:And the reason I asked is because anyone listening who perhaps hasn't started their profit first journey might think to themselves, 35 accounts, there's no way I'm going to be able to open, what would I need all those accounts for, etc.
Speaker B:But actually by starting and doing things in small steps, it's surprising where you can go, isn't it, with Profit First.
Speaker B:Now I would suggest 35 accounts is quite unusual if I'm being perfectly honest, but also very acceptable because it works for your client, doesn't it?
Speaker B:And it's helped to achieve lots of success that she couldn't have achieved if she hadn't have come across Profit first with you.
Speaker A:I think one of the words that I would attach to this is this element of connection.
Speaker A:Quite often I find in talking to business owners, be that clients or just people I know in the business world, we struggle to connect to the financial things in our business.
Speaker A:You know, people tend to run down the path of marketing and sales.
Speaker A:It's where all the fun and the action tends to happen.
Speaker A:The finance is a bit of an inconvenient truth that sits in the background for a lot of people.
Speaker A:But I think one of the things it has allowed her to do, and again, because a large majority of these accounts relate to personal, personal things that she wants to achieve and accomplish, it allows her to connect with all of these projects.
Speaker A:How much money do I have in this account to redo the driveway?
Speaker A:Can I redo the bedroom or the bathroom?
Speaker A:Or, you know, can we do the roofing or the double glazing or the orangery or whatever it might be?
Speaker A:So she gets this sense of connection as she sees the money accumulate in these various accounts to actually think I'm halfway towards being able to get the driveway done.
Speaker A:If we bring in a bit more money, the allocations will work, because the allocations will work and we'll get there a bit faster.
Speaker A:So it also creates this sort of slightly natural incentive in the background to actually push on in business because she is absolutely seeing the benefit of that in her private life in terms of how it's allowing her to deal with these projects in the background.
Speaker A:But yeah, I would agree, 35 accounts is way more than any of my other clients, for sure.
Speaker A:But you know, if it works for the client, it works for the client.
Speaker A:It's straightforward and simple to manage.
Speaker A:I tend to think about this, Tim, a little bit like the idea about when people get into business and we have this idea that running a business bank account is so much more difficult and so much harder than it actually has ever been in our own private life.
Speaker A:And yet for most of us, we probably had our first, I'll say, proper bank account.
Speaker A:Not one that was, you know, grandparents putting 10 pound in on your birthday kind of thing.
Speaker A:Our own kind of regular current account with a high street bank, as it probably would have been probably in our teenage years.
Speaker A:And one way or another we tend to get used to the idea that, you know, money comes in generally as employees.
Speaker A:We get paid that salary on a monthly basis.
Speaker A:Money goes in, we're used to it kind of depleting as it goes through the month, then it replenishes when we get paid again.
Speaker A:And so it carries on.
Speaker A:All of a sudden we get into business and because someone puts the word business in front of bank account, we suddenly think it's a completely different process, works in a really different way, and must be that much harder.
Speaker A:And in actual fact, I think it really comes back to this idea.
Speaker A:It can be much more simple and containable really as an experience than a lot of business owners actually believe.
Speaker A:It doesn't have to be as complex as it's all made out to be.
Speaker A:And I think that ultimately anything that helps us connect with that money that we have in our business, be that through separate bank accounts, things having named purposes and so on, should really only be helping us actually in terms of how we get comfortable managing money in our business as well.
Speaker B:Yeah, it's with, with the bank accounts as well.
Speaker B:You're using money for a purpose, aren't you?
Speaker B:There's real intent into what you want to happen with your money, whether that is profit owners pay tax etc, or whether that is a driveway.
Speaker B:You know, it's, it's completely different scenarios, but the end result is the same because you're achieving what you've set out to achieve by streamlining your money into certain pots and certain sort of pockets to be able to use in those areas.
Speaker B:And I like what you said about the incentive that your client had when she saw, I think you said driveway.
Speaker B:Correct me if I'm wrong, but when she saw that she could.
Speaker B:Was getting close to getting a driveway done.
Speaker B:So it's like, well, if I bring some more money in with the percentages I'm using, I can get there by perhaps this date.
Speaker B:So it actually helps her or as has helped to drive the business forward.
Speaker B:I would say, from, from what I'm hearing that you're saying.
Speaker A:Yeah, definitely.
Speaker A:I mean, I think that it's, it's reasonably true to say most business owners have a goal.
Speaker A:What they don't have is the plan.
Speaker A:Profit first gives us the plan or it does a large part of the legwork to getting us towards the plan, for sure.
Speaker A:You know, the fact that it works on a percentage basis, it adapts to those flows of income in our business.
Speaker A:So we can, you know, I, I don't want to get into the hustle kind of scenario, but, you know, we can work a bit harder, close a few more sales, bring in a few more clients, sell a few more products, whatever it might be, and we can, we can get to see how that actually plays out in terms of what lands in our owner's pay account, what goes into the holiday fund, what goes into this lady's driveway account, you know, all these different things.
Speaker A:It is, it's.
Speaker A:It's very visual to me as I see this idea of money coming in and then actually getting to see where it goes rather than going into that one single bank where everything is held there.
Speaker A:And we don't really have the faintest idea what's in there, who it's for, how we can use it.
Speaker A:Is there enough for me and all the other things besides.
Speaker A:So, yeah, I think this whole idea of actually getting connected to the idea of a goal or a plan and getting things in place that mean we can financially track very easily our progress towards those levels of achievement, sums of money, whatever it might be, that we need to accumulate for different things and different purposes.
Speaker B:Yeah, yeah, it's amazing.
Speaker B:And tell me one thing.
Speaker B:I'm going to ask one more question about this particular client.
Speaker B:Would she have been able to achieve everything she's achieved if she operated a business out of one bank account?
Speaker A:I was just about to say my gut answer to that question is, and then I realized that I paused.
Speaker A:So it's no longer a gut reaction, is it?
Speaker A:Because I thought about it, I would say the answer to that is absolutely not.
Speaker A:Absolutely not.
Speaker A:And that really to me is.
Speaker A:It's the same thing that I think about.
Speaker A:I mean, I tend to approach this from an owner's pay perspective generally, but the idea that we run one bank account, we don't have clarity on anything.
Speaker A:It is just this great big ball of money that we have no idea what it's for.
Speaker A:We know it needs to cover some tax.
Speaker A:We know we're going to need to pay some people.
Speaker A:We might pay ourselves if we're brave enough to do that, given that we can't really see what we need the money for out this one account.
Speaker A:So, no, I, I don't think so.
Speaker A:I don't think it would have happened that way for her at all.
Speaker A:And, and that's partly because there would always have been a degree of fear of if I take the money out for this deposit for these premises, what will I be left with?
Speaker A:Will there be enough left to cover tax, pay me anything I need, so on and so forth.
Speaker A:And I think fear is one of the great things that actually Profit first helps us overcome when it comes to the financial side of business.
Speaker A:I'm not saying it's easy to do and we aren't necessarily fearful about what the process of getting profit first implemented.
Speaker A:Our business may throw up for us some uncomfortable truths in there for many a person who's implemented along the way, but ultimately it does give us that pathway to understand how we can improve things in these areas.
Speaker B:Thank you, Jason.
Speaker B:I love, I love this.
Speaker B:I could talk about this client's journey all afternoon with you and you know, I could, but I'm gonna try and pull my leash back in and, and try and kind of stick to the topics we need to talk about today.
Speaker B:So I want to take you back.
Speaker B:We're going to talk about you for a little bit.
Speaker B:Now I know this, this doesn't sit comfortably with you very often.
Speaker B:You, you actually like to talk about profitability first and help other people a lot.
Speaker B:But I'm going to put the spotlight on you a little bit.
Speaker B:So I apologize for that.
Speaker B:But tell me what you were doing, where you were at just before you joined Profit First Professionals, and why did Profit first stand out to you?
Speaker A:Sure.
Speaker A:Okay.
Speaker A: So I would say probably mid: Speaker A:I'd been working effectively outsourced CFO, that kind of role, portfolio of clients, all owner managed businesses, really just helping them understand their numbers in a very practical way.
Speaker A:My, my love around finance is of a very commercial nature.
Speaker A:I love the process about how businesses make a profit, make losses, what causes that, how we turn those around, how we improve profitability in a business.
Speaker A:So my focus is always Very much on that commercial aspect of finance in a business.
Speaker A:Anyway.
Speaker A:I did do an accounting and finance degree.
Speaker A:The one thing that taught me was that I didn't want to be an accountant as a by the by.
Speaker A:So that kind of put me very much down client side through all of my working life, actually, which very much brings that commercial piece to Life.
Speaker A: But yeah, mid: Speaker A:I've been doing some work for the government's Growth Accelerator scheme whilst that was in operation, helping people get set up with financial systems and so on as they move towards that kind of million pound plus revenue level.
Speaker A:Very sort of specific niche I was working in on those projects at that point in time.
Speaker A:I then met someone who was in the online arena and started watching some of the stuff that she was putting out online.
Speaker A:I wasn't on Facebook at all at that point in time.
Speaker A:Generally very private as a person.
Speaker A:Couldn't really see the sense in sharing my dinner with the rest of the world and so on.
Speaker A:And then started to realize the more that I was following and paying attention to this stuff, more and more people were clearly doing business on Facebook.
Speaker A:So started following a bit more and ended up somehow, through any number of connections, I guess, in a number of American Facebook groups or with American entrepreneurs.
Speaker A:And they were talking about this, this book, Profit first.
Speaker A:And everyone's saying this is a game changer, this is really helping me manage my money and so on in classic sort of UK style.
Speaker A:I totally ignored that and thought, well, I know that there's a load of people using it, but I've got my own system dealing with profit.
Speaker A:I'm fine over here.
Speaker A:So time, time rumbled on a bit and I came across a lady called Adrian Dorison and she was my first online coach, as I would say.
Speaker A: ably takes us back into about: Speaker A: Key West, I think, back into: Speaker A:She said, I get what you're doing, but this would make it an awful lot easier and it would definitely get you into the zone of using client language to talk about money.
Speaker A:Now, I thought I'd always done a pretty good job of like the bridge between accountant and business owner.
Speaker A:I understood the accountancy piece, know the terminology, debits, credits, all the things in between.
Speaker A:But I also understood where the business owner was generally coming from as well.
Speaker A:So I was Quite used to doing that, that bridge bit.
Speaker A:So I took the advice, I read the book and still sat back and thought, yep, I'm still fine doing my thing over here.
Speaker A: d then I think I got to about: Speaker A:Most of the work I was doing at that point in time was very much in person, on site, with a client, those sorts of roles.
Speaker A: n, yeah, finally certified in: Speaker A:But I would very much date it back to meeting Adrian, who some of you will know, now runs Mike's Clockwork program out in US as well.
Speaker A:So, yeah, I would say it dates back almost 10 years for me as my first contact with Profit first in that way.
Speaker A:Yeah, just took me a little bit of.
Speaker A:Bit of time to get going.
Speaker A:Inevitably certified, and then it becomes the whole why didn't I do this sooner?
Speaker A:Moment.
Speaker A:This tends to happen to most of us that get on and progress with it.
Speaker A:But, yeah, so that was kind of the backdrop to that.
Speaker A: So, yeah, certified in: Speaker A:Yes, I still do some.
Speaker A:Some background, sort of management, account style work, I suppose, cfotype work for a couple of legacy clients.
Speaker A:But it's always profit first that I lead with now as the core offer.
Speaker B:Yeah.
Speaker B:So thanks, Jason.
Speaker B:I really appreciate you going through all of that.
Speaker B: Profit first professionals in: Speaker B:So you went through a certification process, the same as our members do now, though there is, absolutely.
Speaker B:Because we do this in cohorts, as you know.
Speaker B:What happened after you certified?
Speaker B:What?
Speaker B:What was the sort of feeling of elation?
Speaker B:Was there a feeling of elation when you certified?
Speaker B:Sorry, I'm putting words in your mouth, aren't I?
Speaker B:What was the feeling when you certified and what happened after?
Speaker A:I think really I'd seen it as a way to, I thought, actually make marketing easy.
Speaker A:Here I am, I know I've been in these groups, all these people talking about profit first.
Speaker A:I now have the credentials I can.
Speaker A:User credentials and the materials and so on.
Speaker A:Finding clients will be an absolute breeze.
Speaker A:And as with most things in life, we kind of start down that path and then they go.
Speaker A:I might have to actually Work at this a bit.
Speaker A:So that really was my journey.
Speaker A:I'd really been through the certification thinking it would really just help me take a very easy step up from a marketing perspective in that way.
Speaker A:And like most things, you know, profit first works.
Speaker A:But you've got to be consistent, you know, the behaviors, the rhythms, the patterns have to come to the fore.
Speaker A:But I was, I was generally fairly independent in my style at that point in time.
Speaker A:So I didn't particularly engage with, with profit first back at home base.
Speaker A:I didn't do a lot of coaching calls.
Speaker A:I very much felt it was on me to progress and make of it whatever I made of it really.
Speaker A:So yes, that's really how that started.
Speaker A: I suppose probably about mid-: Speaker A:Actually it took a little while to get the conversations flowing and find my way with a new type of conversation.
Speaker A: But yes, mid-: Speaker A:And then really from there I would say it just became the more I was implementing profit first in client businesses, the easier the conversation happened, the easier it was to spot the transformations in those client businesses and talk about those that led down that sort of, I say, fairly typical pathway of referrals from existing clients.
Speaker A:People that I knew from a business perspective who knew what I've been doing before and then thought, oh great, okay, well I know people who want that kind of thing, I'll introduce you.
Speaker A:So fairly traditional sort of growth pathway like that really.
Speaker A:But ultimately I would say pretty self sufficient.
Speaker A:I did get back into conversation with Liz, one of the US guides periodically for a while and that was super helpful.
Speaker A:Once I had a feel of what I was actually doing, it seemed to make more sense to me to go back and ask for more help and guidance.
Speaker A:I felt that there were lessons I had to learn along the way to then go and ask the experienced person, I'm coming up against this, how do I handle that?
Speaker A:What do people in the US do about these kind of things?
Speaker A: Because I mean, I think: Speaker A:So yes, a fairly steady journey and pathway through that period of time really.
Speaker A:But fundamentally self sufficient, found my own clients, did the graph work, got the referrals, so on and so forth really.
Speaker A:So I mean, I would say not because it wasn't on offer, but I didn't ask for a lot of help.
Speaker A:It was really a question of head down, do the work, understand what, what makes people, you know, recognize the benefits of the system, speak to those and then take it from there.
Speaker A:Really?
Speaker B:Yeah, yeah, I, I think it's fair to say similar with me.
Speaker B:When I certified, I had a regular call with Liz as well.
Speaker B:Funnily enough, I wonder if Liz actually got designated all the, all the British members at the beginning, but it was very much, okay, how can I help you?
Speaker B:Which absolutely nothing wrong with that, but we've tended to think about that as a membership organization in the UK and Ireland.
Speaker B:And now we've flipped it on our head and said, we're going to guide you how to do this, this and this.
Speaker B:So once people are certified, our aim is, as you know, our aim is to help them take on more clients with profit first in a faster way than what perhaps we did when we first started.
Speaker B:So it's just, just a point I wanted to make because, because we have changed things and tried to modernize things as you do.
Speaker B:Everything evolves, everything improves.
Speaker B:And I know in the US they're doing things a lot more proactively as well now, you know, so I think we would, if we joined now and we went through the US model, we would see a completely different type of membership.
Speaker A:I, I, I was just thinking as you're talking there, Tim, actually I, I can see a number of reasons why I would prefer to certify it now, knowing what I know about how we take people through certification here in the UK and how it really is the bundling of that experience that we have over a period of time now to actually, I don't really like to use the word shortcut, but how we can bring some of these aspects to life a lot faster for people going through certification now and definitely in that period following certification to accelerate some of that learning for people that I think we found out a little bit more through graft and iteration of implementing with clients at a point in time and finding a way that way.
Speaker A:So I love that, that we can actually, you know, accelerate the pathway for people going through certification now.
Speaker A:You know, get the benefits in place faster, give them the shortcuts into those outcomes and routines and things that we, that we know very much happen in that beyond the book zone.
Speaker B:Yeah, yeah, without doubt, without doubt.
Speaker B:And so your, so your journey, you've joined profit first, professionals, then a year later you started to work with clients and you gradually built up more and more clients.
Speaker B:So you now work with quite a few clients and all on, all of them have an element of profit first going on in their business, don't they?
Speaker B:How does, what does that look like?
Speaker B:When you have a monthly call with them.
Speaker A:Fairly simple and straightforward.
Speaker A:I would say clearly, clients are different.
Speaker A:They have different parameters, they have different goals, different plans, different requirements.
Speaker A:But fundamentally, I think it's always been my choice to invest heavily in the beginning of a relationship with a client, in getting profit first as a system properly mapped in.
Speaker A:And I think that that really, it creates the foundation for much broader commercial conversations.
Speaker A:As I mentioned earlier, that's really my love, is having that commercial conversation about how a business is planning to grow, knowing it can make choices with greater degrees of certainty, really being able to open up to the idea of planning into the future.
Speaker A:So the slightly weird aspect of it now, I guess, is, yeah, we do talk about profit first, but not a lot.
Speaker A:Funnily enough, it very much creates the foundation.
Speaker A:The conversation then leads us back to a place of saying, okay, where do these thoughts leave us in relation to our profit first plan?
Speaker A:Are they going to compromise any of the issues that we're trying to protect?
Speaker A:If we make this decision on expanding a team of people or getting new vehicles or whatever it might be, is that likely to compromise that percentage that's going into your owner's pay account?
Speaker A:Do we need to take some money from that in order to be able to afford these things?
Speaker A:Do we really want to do that?
Speaker A:Then?
Speaker A:Is there a different way that we could approach this commercially to think about timing, speed, other ways to do things?
Speaker A:Are there other elements that we're missing in a commercial premise about how a business runs and so on to do that?
Speaker A:So it underpins all of those client conversations, but bizarrely, we don't necessarily talk about it a lot.
Speaker A:So the conversation is very much more about where is the business going?
Speaker A:And then we tie that back into the profitability first plan that we have.
Speaker A:Think about how we upgrade that, typically on a quarterly basis.
Speaker A:You know, what's happening with revenue, what happens with expenses.
Speaker A:It's amazing how much conversation actually comes out of those two questions.
Speaker A:You know, the entrepreneurial world is a great place to be because it's full of people who are thinking about moving forward in their business.
Speaker A:And that's an exciting part of a business process for me to engage with them on.
Speaker A:So, yeah, it underpins absolutely everything that we do, but different levels of gravity, I would say, from client to client, size of business, scope of what they're looking to do.
Speaker A:For sure.
Speaker B:Yeah.
Speaker B:Okay, thank you, Jason.
Speaker B:And just to reiterate, you don't have an accountancy business, you don't have a bookkeeping business.
Speaker B:You are purely a Financial consultant, coach, whatever terminology it is that we use in these scenarios.
Speaker B:But I just wanted to point that out.
Speaker B:So then you came along, obviously with, with me and Duncan taking over the license, we started to have what we call community calls on a regular basis.
Speaker B:And you're a very active member of Profit First Professionals.
Speaker B:And you were always on the calls.
Speaker B:I don't remember many that you didn't turn up to.
Speaker B:And that was probably when you're on holiday and stuff.
Speaker B:So, so we got to know you and you added a lot of value into those calls, calls that were helpful to the other members in the group, especially the newer members that joined after we took the license on.
Speaker B:And so over time then I, I approached you and said, you know, come, come and be one of our guides.
Speaker B:You know, come and work with me.
Speaker B:Let's guide the members together.
Speaker B:How's that been for you?
Speaker B:So what's it like now, seeing the other side of things?
Speaker B:So you, you've, you've been a Profit first professional, you've gone through the training, you've certified, you've then started to work with clients, you've then built your business up all around Profit first and they have a very happy business that you've, you've created.
Speaker B:And then you're sat on the core where Liz was sat, arguably the other side of the, the other side of the, the Zoom room, if you want to call it that.
Speaker A:Yeah.
Speaker B:What does that feel like initially?
Speaker B:How did that feel and how do you feel that's gone moving forward for you?
Speaker A:I think, if I may, I'd just like to backtrack to the front end of that, where you're talking about the community calls, where certainly you and I and Duncan first met in that forum.
Speaker A:Very simple.
Speaker A:For me, as much as I wasn't asking for help out of, out of home base out in the US A lot, it seemed like the most obvious thing in the world to come together and find out how other people were, were delivering what they were experiencing.
Speaker A:Particularly for me in that sort of coach only role, no accounting or bookkeeping practice, none of that compliance work to do, for which I'm eternally grateful, I have to say.
Speaker A:But props to everyone else that does do that in their business.
Speaker A:I think it was like it was an obvious place to come and learn, to contribute and do those things.
Speaker A:And again, back in those days there weren't that many of us anyway.
Speaker A:So I always saw that as being that that sort of dual dynamic of learn, contribute and you know, that forties relationships and all the rest of Those things.
Speaker A: s been since after my kind of: Speaker A:Let's say I've having certified, I've been like all in forever since.
Speaker A:So my wife Sandra's also certified with Profit first as well.
Speaker A:So we believe in it deeply as a family.
Speaker A:We both run it in our own businesses of course in that way as well.
Speaker A:So I think it is truly game changing.
Speaker A:All of the work that I had the privilege to do with clients in that sort of outsourced CFO world, I was involved in their businesses and I enjoy that process.
Speaker A:I think that Profit first has just opened up the dialogue, the frameworks of conversation for that it is truly game changing when people implement and implement well in their business without any shadow of a doubt.
Speaker A:So I've always been eternally sort of enthusiastic about it.
Speaker A:I think now I translate that enthusiasm into understanding what is possible for the people going through certification who do have bookkeeping or accountancy practices behind them.
Speaker A:There is a ready made list of clients, or albeit some people start to realize they don't necessarily have an ideal list of clients on their books at a moment in time, which brings up other conversations, of course, but it is the idea.
Speaker A:They have data to work with.
Speaker A:They have trigger points, as you and I would call them, about certain financial events at moments in time to leverage conversation and think about how they can actually help a business owner.
Speaker A:I go back to one of our members a few years ago who I remember saying she got past the certification piece, had started to have more commercial conversations with one of her clients, one of her beta clients I think it actually was, and ended up coming back on a call with us and saying I feel like I've been a bit of a fraud for the last 12 years.
Speaker A:I don't think I've really been helping my clients at all having opened up this kind of conversation with them.
Speaker A:They're making decisions about whether they get more vehicles or hire more people.
Speaker A:And it's like I feel like I'm involved in that business.
Speaker A:So I think my enthusiasm for it now as a guide, I see what's ahead of these people and I think they don't understand quite how game changing a it could be for their own business, but how the ripple effect through their clients businesses will just improve the lives of many, many people beyond.
Speaker A:So yeah, I'm always eager to contribute on those calls.
Speaker A:And on a Monday morning, as the calls currently happen, it is a highlight of my week.
Speaker A:I enjoy the energy of those conversations.
Speaker A:You know, I enjoy the Q and A.
Speaker A:I enjoy those light bulb moments for people of the whole, oh, I see what this means.
Speaker A:Oh, I could talk to people about this in this way.
Speaker A:Absolutely.
Speaker A:And all of a sudden, I think it opens things up for people as they, they start to release elements of the fear about taking on clients and sinking in some of the, I'll say, more traditional, constrained ways perhaps into thinking about how they could actually think about developing their own business as well.
Speaker A:So, yeah, the whole process is, is a great source of enjoyment for me.
Speaker B:It's great to hear.
Speaker B:Thank you.
Speaker B:And we're in quite a privileged position in many ways, aren't we?
Speaker B:Because we're able to watch and guide, of course, but also watch transformations happen in of our very eyes with some of our members.
Speaker B:What, what's your feeling when our members go through the actual implementation of profit first in their business?
Speaker B:Can you share any reflections on that?
Speaker A:Yeah, for sure.
Speaker A:I, I think, I think as much as I alluded to earlier on, I think it is whether it's clients that I've implemented with, whether it's people coming through certification, where I've seen them go through some of those initial profit assessment exercises, it's always an eye opener.
Speaker A:And I think that it's, it serves actually as a great reminder.
Speaker A:Complacency isn't quite the right word, but how actually when we are, when we have a business that's up and running doing some things, how we kind of settle into it being the norm and, you know, I think that it is one of the, one of the great myths that we're up against is this idea that accountants and bookkeeping practices have it all worked out.
Speaker A:They must be making a lot of money.
Speaker A:And in actual fact, it's not the case at all.
Speaker A:You know, actually understanding the cost of delivery, the team of people that they have, how they deliver to their clients, how they price clients, how they attract clients, how they attract a certain type of client, all form part of that mix of this realization.
Speaker A:But I think the most important part is, and I always think about this, doing a profit assessment with my own clients.
Speaker A:It doesn't matter what the answer is today.
Speaker A:It's important that we actually understand where we are today.
Speaker A:From that point, we can move forward.
Speaker A:You know, I've had clients who've had the kind of the classic 1% profit, 1% owners pay, 98% opex, definitely nothing safe for tax and so on.
Speaker A:It's like, yeah, these things happen.
Speaker A:It is a state that many Businesses find themselves in accountancy practice, bookkeeping practice may not be in quite that state, but they're definitely not in the ideal target allocation percentage end of the scale either.
Speaker A:So I think, you know, we are helping people tune up their own practices as well.
Speaker A:We are helping them understand how as a business owner they can think about elevating their practice to give a them the kind of reward that they actually want for their business.
Speaker A:You know, the classic time and money thing that happens as people start a dilemma that very quickly disappears into the background, hopefully to be seen at some point in the future.
Speaker A:I genuinely believe that we give people the ability to recapture that time and money dream as they go through that certification process with us and start to think, I'm going to say harder about the business that they're running about.
Speaker A:I mean, you know, I tend to focus a lot on this cost of delivery piece.
Speaker A:You know, what does it cost you to deliver the service?
Speaker A:I always think that OPEX is reasonably containable.
Speaker A:Money gets made at gross profit level.
Speaker A:You know, how do we control that cost of delivery?
Speaker A:How do we improve that?
Speaker A:So I think from that perspective we're actually taking these, you know, these PFPs on a very commercial journey in their business.
Speaker A:They have probably not had anyone around them dealing with the conversation in that kind of way.
Speaker A:There'll be tons of information about finding more clients, selling more, growing your list and running Facebook ads and all the rest of it.
Speaker A:Actually running the business for a commercial outcome that we want.
Speaker A:People aren't doing that.
Speaker A:So, you know, I think it is a tremendous benefit as people come, come in and join us here in Profit First.
Speaker A:It is a massive benefit that they get in their business is the boost in the level of thinking and the commercial thinking that's actually going into how they run their business into the future.
Speaker B:Yeah, it's so true.
Speaker B:And yeah, I think there's this definite feeling that accountants of Bookkeep's got everything sorted.
Speaker B:They don't need help.
Speaker B:Actually they do.
Speaker B:I know that through my own personal, you know, experiences going back before I joined the Profit first professionals myself.
Speaker B:So.
Speaker B:And sometimes we've seen quite an emotional reaction from a Profit first implementation in, in members businesses.
Speaker B:And then by the end of the call there's this release of relief I think is probably the right word that actually I've got someone here that's going to help me, that's going to hold my hand and take me through this process and then once I've done that I can start to do this for my clients and I think that's the special kind of syrup, I guess, of profit first professionals is that you live and breathe it in your own business.
Speaker B:You, you reap the benefit of living that profit first life and then you pass that on to your clients so they can live the profit first life as well.
Speaker B:And that so many of our members have said how it's a game changer and how it's life changing for them and their clients.
Speaker B:And I think it's just amazing for us to be able to be a small part of that and to be able to help members and help their clients along the way with their journey towards better profitability and being rewarded from their business.
Speaker A:Do you know, I think that is an incredibly important point.
Speaker A:You know, they should enjoy running their business, they should want to return out of their business.
Speaker A:But yeah, I would agree.
Speaker A:Deep emotional states that we have seen and witnessed.
Speaker A:But again, I think it is, it's testament to the experience that we are bringing into those calls that you and I both know there is a pathway forward.
Speaker A:And the most important point is we understand where we are today.
Speaker A:We can absolutely move forward from here.
Speaker A:I think there is also within that emotion there is that sense of relief.
Speaker A:I've had this suspicion that things were a bit off.
Speaker A:I've thought about the reasons why I might not be able to pay myself quite so much.
Speaker A:But here it actually is in black and white.
Speaker A:But here also is a plan about how that change is moving forward that doesn't say it flips, you know, 180 degrees overnight from that moment in time.
Speaker A:Time, it takes work.
Speaker A:You know, I go back to my own story.
Speaker A:It takes work to do these things.
Speaker A:It takes consistency, it takes commitment to follow the pathway and you know, the degrees of accountability, the self accountability, the accountability that they bring back into our post certification calls typically, you know, to keep people moving forwards.
Speaker A:It's a really important part of the process to actually feel that you have people who are on your side not judging you.
Speaker A:I couldn't care less if someone's figures are 1%, 1%, 98%.
Speaker A:That's just a starting point.
Speaker A:It's what we do next that really matters.
Speaker A:And I think actually I would really hope that there would be members who would say we've actually helped them breathe life back into their business actually at that extent.
Speaker A:And yeah, I think it's the greatest thing to see these people actually get to a point where all of a sudden they talk about taking that first call, profit distribution, where they get into that moment of increasing their owner's Pay percentage where they feel that they start to have things under control a bit more might not be where they want to get to, but they know they're on that pathway to getting there at that point.
Speaker A:And I think that is, that is just such an incredibly important part of that process for people that actually, yeah, it can be uncomfortable.
Speaker A:No point hiding away from that, but bring the uncomfortable and we can help you move further and further away from that feeling, you know, to see those progressions in a business.
Speaker B:Yeah.
Speaker B:The great part of this as well is some people have joined us having self implemented Profit First.
Speaker B:Some people haven't started implementing Profit first just because they weren't too sure how to start.
Speaker B:The people that have started what they believe is a Profit first implementation have had enlightening moments on course with us, haven't they?
Speaker B:And I think it's fair to say implementing Profit first is something that is done best with the guidance of the Profit first professional or for our new members of Profit first guides.
Speaker B:Would you agree with that?
Speaker A:100%?
Speaker A:It is absolutely true.
Speaker A:Anybody can implement from the book.
Speaker A:And both, as we talk about it in terms of PFPs coming through for certification, I've definitely had it with clients who have got to a level of self implementation, you know, who've come up with things.
Speaker A:I just don't see how I will ever get down to that 30% target level in OpEx.
Speaker A:Well, it's because they're not seeing things going on in the background and different ways of interpreting the information to restructure things slightly and how they're looking at things in order for that to be a possibility.
Speaker A:There are always layers.
Speaker A:I think it is this idea of beyond the book.
Speaker A:You know, you and I talk a lot about.
Speaker A:We all, as Profit first professionals, we read the same 200 pages.
Speaker A:We read the same 200 pages as every entrepreneur out there who's ever read the book.
Speaker A:How we go so much deeper with it as a framework, as a system, as an idea about how it becomes, I will say, a bit more malleable.
Speaker A:It's like most things, you know, you become experienced with things.
Speaker A:You know, we're not taking shortcuts here.
Speaker A:We're using experience to accelerate a process and an outcome for that matter.
Speaker A:And I think that, you know, it's the classic thing, isn't it?
Speaker A:We can all go Googling and youtubing until the end of time to find answers to things.
Speaker A:But sometimes that element of being able to have access to an expert who understands inside now how things are working, how things don't work, how we can change things in order to create outcomes and get people onto a positive pathway and a much more direct pathway most of the time, how we can actually give them the confidence.
Speaker A:Certainly one of the things that I've found historically is people who self implement don't necessarily actually change that much once they've done that first implementation because they're still at a point where they don't necessarily trust themselves or themselves to operate the system, to move their percentages every quarter, to take the quarterly profit distribution, to think about how they plan for cost into the future.
Speaker A:These are all things which I think, you know, certainly view and I they are second nature to us in how we think about operating profit first as a framework and a system in a business, be that, you know, for a profit first professional coming through certification, helping them post certification, or whether that is our own clients.
Speaker A:There are countless benefits to hiring a PfP, you know, to accelerate and improve processes and appreciation of the system.
Speaker A:For sure.
Speaker B:Yeah, without doubt.
Speaker B:And so Jason, what would you say to anyone who's watching this that's maybe an accountant, a bookkeeper or a coach, what would you say to them in respect of whether they should think about joining proffers professionals or not?
Speaker A:Okay, I'll deal with the accountants and bookkeepers first.
Speaker A:So unfortunately you left this question to the end, so people hopefully will have listened to most of it before they switch after about what I say.
Speaker A: hen I first Certified back in: Speaker A:And I think my conclusion that I eventually came to was that my edge was going to be talking about the client's business in the future.
Speaker A:So in very simplistic terms, I sort of started thinking about it.
Speaker A:Accountants typically working in the past, historic data, year end accounts, you know, at what point they gather the information together to produce that set of year end accounts already update, so on and so forth.
Speaker A:Bookkeepers probably in the present, current month processing, maybe current quarter processing for sure.
Speaker A:But I'm thinking neither of these groups of people are typically it's not to say that people don't, but typically and broad generalization, they are not handling a client's business into the future with them and certainly not on an ongoing regular basis.
Speaker A:So I very much made it my business, I think to focus on understanding that a client's business is actually happening in the future.
Speaker A:I can't do anything about what's already happened, but I can use the breadcrumbs of history to give me some clues about what's been going on, so on and so forth.
Speaker A:But really as a way to inform how we make decisions in the future, I want my clients to understand that they do have the ability to answer the question, can I spend the money?
Speaker A:P Ls, balance sheets, cash flow statements, the way they are traditionally prepared, do not give a client client the ability to answer that question in real time.
Speaker A:Profit first In a business, 100% gives people the ability to answer that question.
Speaker A:And that ultimately is the question we will face as business owners.
Speaker A:Can I spend the money on people, staff, stationery, advertising?
Speaker A:Doesn't matter what it is, that's really the question.
Speaker A:And including, of course, can I spend the money on myself as the owner?
Speaker A:So I think my point here is the edge for accountants and bookkeepers as they come into profit first is giving them an ability to move into an advisory framework which helps clients actually win in their businesses in the future.
Speaker A:The world's uncertain.
Speaker A:You know, you and I could, you know, create a plan for a client.
Speaker A:We probably come up with two slightly different answers.
Speaker A:But ultimately we are focused on that client winning in the future.
Speaker A:And that is the piece that I see in that advisory space.
Speaker A:We have a framework, we have ready made strategies and solutions to help people implement and help clients win.
Speaker A:It's not difficult to actually implement, it's not necessarily straightforward to understand, but that's why we're here as guides to help people through this process, to do some of that translation from an American written book for ultimately an American audience in the beginning, you know, to help people make those progressions and see how they can really genuinely make a difference in their client, clients, businesses in the future.
Speaker A:So yeah, it's the future focus for me.
Speaker A:It's where the edge is, it's where the advantage is.
Speaker A:I will put a lot of bookkeepers and accountants out of business, I'm sure in the years to come.
Speaker A:That, however, should also be a massive advantage to those two sets of people at the moment.
Speaker A:Enhance and use AI for the things that you can to free yourself up to deliver higher value service to your clients.
Speaker A:So, you know, the AI piece, is it, is it competition?
Speaker A:Is it not competition?
Speaker A:Will it put us out of work?
Speaker A:Think about how it actually helps you have a better mode of business to move into.
Speaker A:I think would be one of my thoughts around that as well.
Speaker A:At this point.
Speaker A:So, yeah, it's all about the future for me, very much.
Speaker A:Has been for the last five or six years.
Speaker A:It's where clients want the answers.
Speaker A:Can I afford to do this thing in the future?
Speaker A:Can I build a team?
Speaker A:Can I spend money on advertising?
Speaker A:Those questions don't come out of traditional compliance, bookkeeping and accounting work.
Speaker A:They come out of an understanding of where your client is going and how we have a system in place that can help give them the confidence to make those decisions as they move into the future.
Speaker A:Does that cover that off?
Speaker A:Hopefully people are still listening.
Speaker B:Fantastic answer.
Speaker B:Thank you.
Speaker B:And so anyone who is listening that would like to learn more.
Speaker B:You may be a business owner that wants to be put in contact with a Profit first professional.
Speaker B:You might be an accountant, bookkeeper or coach who wants to find out more about what it's like being a Profit first professional.
Speaker B:You can just hit the website, which is profit first uk.co.uk Myself and Jason also run another group now.
Speaker B:We call this Croissants Coffee and Profit first that you can access the group via Facebook.
Speaker B:If you go to Facebook and look at Croissants Coffee, Profit first, you will see us both smiling and a picture of some croissants and coffee.
Speaker B:And we hold monthly sessions on a Friday morning, hence the name and we talk about all things that are that are there to support accountants, bookkeepers and coaches with the primary focus on discussing Profit First.
Speaker B:As you can probably tell, this is our favorite topic and we love to talk about it.
Speaker B:So, Jason, thank you so much for spending so much time with me this morning.
Speaker B:We both are very enthusiastic about Profit First.
Speaker B:Your enthusiasm comes across immensely to our members who cannot talk more highly of you.
Speaker B:So thank you for the time you spend with them and thank you for spending some time with me today.
Speaker B:I know we could carry on this conversation for hours on end and we would still have more to talk about.
Speaker B:But for now, thank you very much, Jason.
Speaker B:Really appreciate your time and for spending time with me.
Speaker A:Great.
Speaker A:Thanks for the invitation, Tim.
Speaker A:Delighted.
Speaker A:I could, I could do the session with you.
Speaker B:Thank you for joining us on our podcast today.
Speaker B:Profit first beyond the Book was brought to you by the Profit First Professionals UK and Ireland team.
Speaker B:If you'd like to find out more about Profit first or becoming a Profit first professional, head to our website, profitfirst uk.co.uk.
