Tuesday, July 23, 2013


Last week we talked about working with your banker and some of the do's and don'ts of that relationship. I hope you found it helpful. You may recall I encouraged you to provide professionally prepared financial statements on a regular basis from a qualified accounting firm.

This week I want to address some of the points I consider important when determining how to find the right accounting firm to assist you until such time you decide to hire you own in house financial manager.

If you are like me, you probably started out doing "shoe box" accounting. Some of you may still be doing it. That is where you put all your receipts, invoices, and checks into a "shoe box" and take it to someone to "straighten it out" at the end of the month or end of the quarter. For those of you that really hate the numbers part of the business, you probably wait until April  14 and then take it to the "tax man" or "tax lady".

Let me suggest to you that doing what I have just described is a big DON'T when you are starting a business or at any time in your business life. The next door neighbor who does some yearend tax work to earn extra money is not the person to be interviewing to be your accountant.

It is important to always be looking into the future of your business and associate yourself with professionals who can help get you there and an acccounting firm is no different. It is extremely important that you employ a firm or person who, when doing your books on a regular basis understands something about our service business. You are worrying about getting new customers and you need someone reliable that can provide accurate understandable numbers about how you are doing.

So many of the people that are doing accounting work today use "off the shelf" software that many times is not designed for our type of business. They use terms like "cost of goods sold" and  "merchandise sold this month". Ours is a labor business and we deal in payroll and sometimes it is hard to get that message across to them. They want us to change our business to adapt to their software instead of them adapting to our business. DON'T LET THEM TALK YOU INTO DOING IT.

When interviewing a potential accountant it is important to get the right answers to the following questions:

>>>Do they have extensive experience with SERVICE type companies?

>>>Are they willing to work with a chart of accounts consistent with our industry, not a standard "off the shelf" one.

>>>Will they willingly provide percentages on the statements, year to date numbers, and comparisons to last year's numbers?

>>>How soon can they produce the monthly statements? You should have them no later than 7 business days after you provide them them the needed information.

>>>Will they file all quarterly state, local, and federal government reports and year end W-2"s etc.?

>>>How willing are they to review the statement with you each month and "provide you an education" on what they mean?

Eventually you will, if you haven't already, purchase an industry specific software package and have you own in house accountant but these are important questions to  have the right answers to when you are beginning or are an emerging company.

I cannot over emphasize the importance of having accurate and timely financial information at all times in your company. I don't care how good you are at stripping and recoating a VCT floor or if you are the industry expert at shampooing carpet in your city. If you don't have the ACCURATE TIMELY financial data to support what you are doing, you won't be doing it for long.

It is pretty safe to say that more companies fail in business due to the lack of paying attention to the numbers than fail due to lack of increased sales or inability to do quality work. All the business in the world does you no good if you are losing money doing it and so many contractors are losing money doing it and don't know it until it is too late. Don't be one of those companies.

There is a lesson to be learned here whether you are just starting out or are struggling trying to figure out what is going on---"I'm working harder and harder and I have no money. The harder I work the broker I get". Again let me say, don't let it happen to you.

Thanks to all of you who have purchased our new DVDs. It is obvious by the robust sales that there is a need for education on Conducting an Effective Walkthrough and Getting the New Account Startup Right. We really appreciate the response.

By the way, I understand registration is now open for both the ISSA trade show and BSCAI convention coming up in November in Las Vegas. You can go to www.ISSA.com or www.BSCAI.org  for all the information. Hope you are making plans to attend these great learning events.

Till next time.

Wednesday, July 17, 2013


In my role as a consultant I have been priviledged to work with many start up and emerging young companies. It's exciting to watch them build their organization with sales and staff that can help them on the road to further success. On the other hand, I have seen several companies that have had to pass on golden opportunities because they didn't have the personal funds to finance the growth and had not taken the time to do the leg work to find a banker to work with. It is a critical step in successfully growing a company---trust me.

One of the major points I always cover with young and emerging companies is to establish a strong banking relationship early to assist in the growth that is coming. When you are starting out, you may be in the same boat I was and that is to just find a bank that is interested in working with you. Finance is complicated today and banks are more cautious than ever but it is an extremely important step to take if you want to grow your business. Banks today are enforcing rules that they were supposed to be enforcing all along which means you may have a few more hoops to jump through.

I found a small town bank 50 miles from my office to help me in the beginning. It wasn't the ideal arrangement but it got me where I needed to be so I could take the next step.

Let me offer some questions you can ask the bank to help determine if they are right for you.

--What is the bank's focus? Small business, retail, service related companies, large corporations? This helps you determine how much attention they will pay to your needs.

--How much "desk authority" does your personal banker have and how long has he or she been with the bank? In other words, how much money can they loan you without having to go to the loan committee. The length of time they have been with the bank many times will dictate how much authority they have. The higher their desk authority the better it usually is for you.

While it is important to interview the banker in the early years you may not have many choices as to which bank to do business with. That being said, that can change overnight as the winds of the business climate change. Nevertheless, here are some rules I followed with the banking community that served me well. In fact, sometimes they loaned me money when I wouldn't have loaned me money but by following the policies that follow, we built tremendous trust with our bank.

I started to borrow small amounts early on even when I didn't need them so I could pay back early and establish that track record. I remind you that rules are now being enforced by banks that weren't being enforced before and so you need to be thorough in your preparation of information to the bank.
Bankers don't like surprises and just because you have chosen a particular bank to do business with doesn't mean they will provide unlimited funds whenever you need them. Start small, build up, and they will be more comfortable when the big need arises.
Let me suggest that you treat your banker just as you would a key customer or prospect. It is important to "keep them in the loop" as to what is happening but also don't hide bad or negative things. They will eventually find the negatives, especially in today's business climate so no use hiding them.
My banker was on my appointment calendar to formally visit just as my good customers and prospects were. I suggest you do the same. I tried to always get them away from their office if at all possible, usually for lunch. I invited them to come by our office and see what was going on with us and then we would go to lunch, and yes, I even bought some of the time.
Early in your business be sure to get established with an accounting firm that can prepare these statements. Your banker wants to see professional data and not a cigar box arrangement that you take to a tax person at the end of the year. Using a professional acccountant is one of the most important investments you can make early on.
Then, provide regular monthly or quarterly statements to the banker even if you don't need money so when the time comes that you do need major money, he or she has up to date information that will speed the process of a loan approval.
 Chances are that at sometime during the life of your business, cash flow is not going to go as planned (how about right now?). When that occurs, meet with the banker and tell him or her the situation before it becomes painfully apparent. Believe me, I had the opportunity (?) on several occasions during the nearly 35 years I owned and managed my own company. If you have developed your relationship as we have been discussing, your chances of them understanding and being cooperative with an alternate repayment plan on notes due are excellent.
Be ready to answer questions as to what went wrong with the last plan and what the reasons are that made it not work. Remember, PRESENT FACTS, NOT THINKS.
It is  also important to remember that while you need the banker to help you grow your business, they also need you as a customer to grow their portfolio. Banks have money for rent, that is their business. What you are doing is asking to rent a certain amount for a specified period of time at a specified rate. While the banking climate can be very tough, it is incumbent on you to negotiate the best interest rate you can, just as your customers negotiate the best rate they can.
As you grow your business and mature into a sizable "major player" in your marketplace, how you develop your banking relationship will have a major impact on whether you become successful or whether you become one of those 33% of contract cleaners that go out of business every year. I'm betting you are going to stay in business.
As a reminder, I hope you will check out our new DVDs in the DVD section of our web site. And don't forget our weekly FREE pod cast at www.tripodcast.com.
Till next time.



Tuesday, July 9, 2013


A couple of weeks ago I had the priviledge of spending some quality time with a distributor who showed me how he was providing added value to his customers, especially the BSC. This distributor gets it. He understands that anyone can sell price, but not everyone can provide real training and education to their customers. Let me rephrase that. Not everyone wants or cares to provide the education and training that makes them a true value added vendor for the BSC.

So what is he doing? One thing is that he purchased some quality video equipment and then created an entire library of 3-4 minute training videos on just about any technical subject needed. Following that he created educational information that the BSC can access as needed.

He then made available to his customers what I would call a Kindle on steroids. Companies can obtain as many or as few as they desire depending on how extensive they want to utilize the benefit. Most companies provide a unit for each area manager and stand alone project managers. Great concept isn't it. There is a small user monthly user fee associated with the service but think of the savings in training costs if you can just connect to the subject matter you need and conduct an instant short training class wherever and whenever it is needed.

I mentioned this concept to a non competing distributor last week and was told this concept is now very prevalent in the industry and is provided by many distributors. I asked him if his company utilized the idea and the answer was no. His reasoning was they want to provide the PERSONAL touch to their customers, in person and up close. Seems to me it would be a great time saver to the distributor representative if they didn't have to go out so much at night to help train. So let me ask you readers--How many of you have this or a similar service available from your distributor? If it is available, do you take advantage of it? Why or why not? I really would like to know how extensive this is happening around the world. Just leave a comment in the appropriate space after this article.

One of our companies, Tripod Learning Associates has been working with some organizations to develop short videos etc. just like the first distributor I mentioned above has and we have not found it to be that prevelent in the distributor industry. In fact, some BSC's have contacted us to assist them in developing a similar program inasmuch as their distributor does not provide this service. It seems to me that a distributor would want to jump on this service and make it available to their customers. We don't see it as competition but rather an opportunity for all of us to work at improving the communication and training in our great industry.

While I'm on the subject of communication and training, are any of you producing regularly scheduled pod casts for your employees to listen to? This is a great way to communicate new procedures, remind employees of project work that needs to be done or just to recognize a crew on great work or an employee's birthday or anniversary. It's not hard to do and can be so effective. Not long ago very few of our employees owned or had access to a computer but that has changed and will continue to change. I strongly recommend you consider this method of communicating. I can tell you that we have been doing our regular Monday morning free Tripodcasts for nearly 5 years and are continually amazed at the growing response and communication that takes place as a result of just reaching out weekly to the industry.

I have long been an advocate of having a strong relationship with 1 or maybe 2 distributors to help you grow and build your company. These are just additional ways they can help. My distributors were a very integral part of my business and we developed some very strong and mutually profitable relationships.

Till next time.

Tuesday, July 2, 2013


I had the privilege this past weekend to conduct a workshop entitled "Effective Selling in Today's Economy". I really enjoyed the experience and hopefully the participants went away with knowledge they can use immediately in their businesses.

One of the exercises we did that I thought was a great learning experience was one where I asked the participants why a prospect should buy from them. We wrote the answers on the board and got some really excellent responses. Had a smart group there.

What about you? Have you answered the question of why people should buy from you? When I do on sight consulting, that is one of the first questions I usually ask and almost always get answers like,






These traits may all be true but do they really distinquish you from your competition? Have you been in business 20 years or 1 year 19 times over? Some companies NEVER seek out any continuing education on how to do things better. Have you attended a BSCAI convention or an ISSA trade show recently to find out whats new"?

How do you know you are the best in town--because you said so? Hardly a strong endorsement.

How does you training differ from your competitors? You see, nearly every BSC I know claims they have a great training program. The reality is many of them haven't held a training session for anyone in their organization since Noah parked the ark.

If your quality is best how do you know? Have you been doing inspections of your competitors work? What's the benchmark?

If you have a quality inspection program, what is it and how does it benefit the customer?

You see, in today's business climate, prospects want to know what makes your company REALLY unique. How does it stand out from the rest? What value do you bring that will relieve the prospect of some of the headaches they endue every day. Do you offer them a real partnership or are you just reminding them that you react fast if THEY find a problem with your service. Shouldn't you find the problem first and correct it before they even know there is a problem. That is a contractor of value to the prospect.

Let me suggest that you conduct a work session with your key staff and ask that question---Why should anyone buy from us? This could be some of the most valuable time you will ever spend with your people. It's important to your future survival. Make sure you have  real and meaningful answers. If you come up with the same ones I listed above in capital letters, you have some work to do. Customers don't want "me too" companies. They want companies that inovate, relieve headaches, and are proactive in their endeavors.

So...why should anyone buy from you? Give them several REAL reasons. If you don't have any now, let's get to work and become the most valuable BSC in the territory you cover.

A quick note to let you know that this month we are releasing our two newest DVDs entitled,

How to Conduct an Effective Building Walk Through
Getting the New Account Startup Right

They'll be available on our web site within a couple of weeks. Both will have details of procedures and processes we used in our 43+years in the business and should be extremely helpful in your business. If you want to order early, you can call us at 573.374.1111, place your order and we'll ship free on any early phone orders.

Till next time.