Busy Business, But Where Is the Profit Going? | Profit Leak Audit — Transcript

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1. 0:00One of the things I hear from business
2. 0:01owners is we're busy, there's plenty of
3. 0:03work coming in, but there never seems to
4. 0:05be as much money left over as there
5. 0:07should be.
6. 0:08And often the first thought is that we
7. 0:10need more sales, which might be true,
8. 0:13but before we go chasing more work, it's
9. 0:15worth understanding what's happening
10. 0:17with the work that we're already doing.
11. 0:19Are we charging enough? Are we allowing
12. 0:21for everything in our quotes? Is the
13. 0:23team spending time on things that we can
14. 0:25actually charge for?
15. 0:26Because if there are gaps in those
16. 0:28areas, getting busier can just give you
17. 0:30more of the same problem.
18. 0:32So, that's why I run the session called
19. 0:33the profit leak audit. I'm Jon Randalls,
20. 0:36a business coach and advisor, uh former
21. 0:38business banker and business owner, and
22. 0:41I want to show you a small part of what
23. 0:43the profit leak audit is about.
24. 0:45These are made up figures are for an
25. 0:47example business, but they'll give you
26. 0:49an idea of how it works. Let's say
27. 0:51you've looked at this business and
28. 0:53identified that pricing and quoting
29. 0:54deserves some attention.
30. 0:57Perhaps the prices haven't been reviewed
31. 0:58for a while, or the quotes don't quite
32. 1:00cover all the time and materials
33. 1:02involved. The jobs are getting done, but
34. 1:05the business is absorbing costs that
35. 1:06really should have been charged for.
36. 1:08This business is generating $650,000
37. 1:12in gross profit. If we can improve that
38. 1:14by 5%, we could end up with another
39. 1:17$32,500
40. 1:19a year.
41. 1:20And to be clear, that's 5% improvement
42. 1:22in gross profit rather than just putting
43. 1:24prices up by 5%.
44. 1:26And that's only looking at one of the
45. 1:28four foundations of a business we assess
46. 1:30during the profit leak audit.
47. 1:34And this is where the conversation
48. 1:36matters. It's easy to change a number on
49. 1:38a screen. What we need to understand is
50. 1:40which opportunities are realistic for
51. 1:42your business, what you need to do to
52. 1:43achieve them, and where your effort will
53. 1:45make the biggest difference.
54. 1:50We work through all four foundations,
55. 1:52pricing and margins, productivity,
56. 1:53marketing and sales, because the answer
57. 1:56won't be the same for everyone.
58. 1:58You might be quoting well, but spending
59. 2:00too much time fixing mistakes. Or you
60. 2:02might be paying to generate inquiries,
61. 2:04then missing out because no one is
62. 2:06consistently following up.
63. 2:08There's usually no shortage of things
64. 2:09that you could improve, but what I want
65. 2:11you to leave knowing is which ones
66. 2:14deserve your attention first, what they
67. 2:16could be worth, and what you are going
68. 2:18to do about them.
69. 2:20Before we meet, you complete a short
70. 2:21form of some background and a few key
71. 2:23business figures. Then we spend 90
72. 2:25minutes working through it together, and
73. 2:28afterwards you receive a written summary
74. 2:30of the estimated opportunities, the
75. 2:32priorities, and the first actions.
76. 2:35The session is $500 plus GST.
77. 2:39You can take what we've worked through
78. 2:40and implement it yourself, or if you'd
79. 2:42like help putting it into practice, we
80. 2:43can talk about working together.
81. 2:45You're already putting in the effort
82. 2:47into running your business.
83. 2:49It's worth taking 90 minutes to
84. 2:51understand where more of that effort
85. 2:52could turn into more money that you
86. 2:54actually keep, rather than getting to
87. 2:56the end of another busy month wondering
88. 2:58where it all went.
89. 2:59The question is whether there's
90. 3:01something worth fixing that you haven't
91. 3:03put your finger on yet.
92. 3:06In the example we've just looked at, the
93. 3:07potential improvement was $32,500
94. 3:10a year from pricing and margins alone.
95. 3:14Your numbers will be different, but for
96. 3:15$500 plus GST, we can assess all four
97. 3:18foundations and give you a clearer idea
98. 3:22of where to focus.
99. 3:23If you'd like to see what your numbers
100. 3:25might reveal, follow the link and send
101. 3:27me a short note about your business.
102. 3:29We'll check that the session is a good
103. 3:31fit and find a time to work through this
104. 3:33together.
105. 3:35The real question is, what could be
106. 3:36sitting inside your business that you
107. 3:38haven't found yet?