Episode Transcript
Glenn Harper [: 00:00:04
Well, hello, everyone. Welcome to another special edition of the Empowering Entrepreneurs podcast. I’m Glenn Harper.
Julie Smith [: 00:00:09
Julie Smith.
Glenn Harper [: 00:00:10
What’s going on, Julie?
Julie Smith [: 00:00:11
I don’t know. You got that down. You said put special edition in there. And somehow you were able to put empowering entrepreneurs together, unlike the last five episodes.
Glenn Harper [: 00:00:19
Bumbling and stumbling through the things. Yes, it happens sometimes. There’s a lot. There’s a lot of vocabulary, a lot of words, a lot of letters. It’s hard to keep it all together.
Julie Smith [: 00:00:26
Yeah, I get it.
Glenn Harper [: 00:00:27
I know. It’s. What do we got on the docket today?
Julie Smith [: 00:00:29
So we want to know why are we losing money? Like, who’s we? What are those hidden things in businesses of why we’re losing money? Now, before. I want to say, before this video started rolling, I tried to give all mine.
Glenn Harper [: 00:00:43
Yeah, well, this was an eventing session.
Julie Smith [: 00:00:45
And no one wanted to listen to him. So I’m only allowed to ask the question today.
Glenn Harper [: 00:00:48
Gotcha. So we were talking basically money leaks. Like, if you have a business, like, where is. If you would just look at these few things, what would be a good way to kind of shore up some of your financials and the cash flow leaking? Right. I think that’s where trying to talk about. I think one of the biggest ones that I find myself doing not only for myself, but also we end up doing this a lot for our clients is you get these automatic charges on your credit card. You sign up for something and it just keeps pinging you every month. And with a credit card, fraud is amazing.
Glenn Harper [: 00:01:15
And if you’ve got a credit card that you’ve got, you know, more than probably 40 transactions a month, nobody pays attention to that. But you are getting hammered every month by all these different charges that people. You don’t even know what you’re buying for or something that you don’t even use anymore.
Julie Smith [: 00:01:28
But I think that’s business owners. And personally, I know there’s been these apps that have come out that’ll like, help manage that. But again, now you’re paying a subscription to an app to manage your subscriptions to, Like, I mean, where’s it at?
Glenn Harper [: 00:01:40
Yeah, like, you just have one that would just give me one password for everything, but that doesn’t exist either. But that’s a big one.
Julie Smith [: 00:01:46
I use one password for everything, so don’t talk about it. Oh, jeez. No, I’m just kidding.
Glenn Harper [: 00:01:49
No. The second thing is, you know, it’s one of the biggest costs for most businesses are the employees and what you spend on there. And, you know, some People, you’ll get lucky and you can pay salary and sometimes you have to pay hourly. But overtime is a big one that hits. And depending on the certain industries, overtime probably isn’t needed as much as it’s paid. But people will milk the clock until they hit overtime and then they’re making, you know, the time and a half. So you just got to keep an eye on your labor costs every week. That’s a really big one.
Glenn Harper [: 00:02:19
And also, well, wait, the big beautiful.
Julie Smith [: 00:02:21
Bill, the overtime is going to be even more enticing to the employees now. Right?
Glenn Harper [: 00:02:25
Correct. And well, as a business owner, you guys might be thinking out there, well, heck, I’m going to lower everybody’s salary and then pay or their wages and then pay overtime so I can skirt the issue. You’ve got to be real careful with that because I’m sure there’s a lot of regulations on that that’s in the bill. But that’ll come to fruition here soon. You as the employer, it doesn’t change anything. You’re paying it anyway. It’s just going to help the employee. But there’s that.
Glenn Harper [: 00:02:48
And especially when you’re in projects, when you have employees that you’re working on projects, maybe a construction or some kind of construction management or something, when you are the job costing for that job, you might have budgeted 10 hours for this project and somebody might be in there for 15. And of those 15, five of them are overtime. You just doubled up your labor costs and you don’t even know how it happened. So it’s just something you really want to look at. Just review your time. Who’s entering the time, is it accurate and are we supposed to be paying overtime or not? Because there’s a fine line between paying enough overtime before you got to hire a new person or a new crew or whatever, you just got to find that sweet spot.
Julie Smith [: 00:03:28
I think all of those though go to. Is that what the firm owner or the business owner should be doing? You know, so can you delegate some of those out to make sure they’re managed in the most efficient and effective manner?
Glenn Harper [: 00:03:41
Right. I mean, you’re going to have somebody that’s going to be recording the time that’s. I mean the business owner is probably not going to be dealing with that. But there’s going to be a, you know, somebody that in HR that’s.
Julie Smith [: 00:03:49
And you got to set those parameters too, those expectations so that people understand like, okay, we’re over budget or, or we don’t want to see these, you know, what are these Subscription some way, shape or form to make sure there’s some checks and balances with all of those to make sure that you don’t get caught in these situations.
Glenn Harper [: 00:04:04
You know, it’s funny, you end up, people think, well, I can’t afford to hire a manager to manage my labor. But what you’re paying and losing in overtime would pay for like four managers. So you got to look at the big picture, what that looks like throughout the year. You sometimes can’t afford not to have somebody watching the hen house. That’s probably one of the biggest things you gotta realize sometimes you gotta spend money to make money and you end up being ahead, which is a crazy concept, but it does work. Again that we talked about a little earlier, the subscriptions. You click on something and you’re getting pinged for that every month or every year and you don’t even know you’re paying it. You don’t even know you’re involved in it.
Glenn Harper [: 00:04:39
When you do a once over, at least once a year, you should be looking at all those charges that come through on your, you know, in your financial statements and sort them by name and go, why am I even paying for that anymore? It’s amazing what a little bit here and there adds up to. You’re like, oh my gosh, that’s all vacation for the year. I just paid for no reason. If I can just cancel it.
Julie Smith [: 00:04:57
Well, my kids always sign up for that. Alexa, Amazon Music. Right. Unlimited. Like how easy is it? And so it’s like, unless you’re watching, you have no idea.
Glenn Harper [: 00:05:05
Yeah. The other thing too is sometimes we get in the habit of we pay things late, perhaps as a business owner, cash flow issues, and those late charges add up pretty quickly and it adds up and you don’t even know you’re paying it. And that’s the same thing. If we have loans, if it’s a low interest rate, you know, debt’s not a bad thing, but it’s sometimes not a good thing. If you have a high interest rate and you’re on your line of credit or something, or a car or some piece of equipment, maybe you’re leasing something, you thought you got a good rate. You really should look at those debt services that you have because sometimes they got buried in there some incredibly high interest rates that you don’t even know you’re paying. You know, you would think you’d be paying between 7 and 9%, but. But sometimes it’s upwards of 18 to 22% and you even know because it’s buried in there.
Glenn Harper [: 00:05:48
And the financing company don’t even tell you what it is. You have to dig for it. So that’s a big one. If you’ve got some line items where you’re buying some equipment and things of that nature, definitely look into that. The biggest other one that really happens for most customers or businesses out there is you’re billing your customers, whatever that product or service is. But for some reason you’re not following up to have your customer actually pay you or they’re paying you the wrong amount and you’re like, ah, we’ll just let it go. Like it’s not fair for you to spend all your money to deliver the product or service. And then the customer drags you out for 30 days, 90, 60, 120 a year, and you’re not getting money on that.
Glenn Harper [: 00:06:29
And they expect you to just do that. You have to have some hard limits and say, look, we either get paid or we suspend the service. So really try to manage that. AR and you probably would have somebody specific in your office doing that for you or your company. But that’s one of the really biggest ones that you could think about.
Julie Smith [: 00:06:47
Those are some. Those are a lot.
Glenn Harper [: 00:06:50
That’s a lot there. But again, each one is not going to move the needle a ton. But you add all those up. Again, we’re talking about you take a couple vacations, good vacations, not just going to the corner store there. We’re talking about going out of town maybe. And that saves a lot of money. So hopefully that sounds helpful for all of you guys listening. I’m Glenn Harper.
Julie Smith [: 00:07:11
Julie Smith.
