Mastering Profitability in Construction with Susanne Mariga

Welcome to the Construction Disruption Podcast, where we

uncover the future of design, building, and remodeling.

I'm Todd Miller of Isaiah Industries, manufacturer of

specialty metal roofing and other building materials, and today my

co host on the show is Ryan Bell.

How you doing, Ryan?

Hey, Todd, I'm doing great.

How are you?

You know, I'm doing well also.

I've been a busy week.

Um, lots of things, construction is in full force out there these days.

And so that's exciting.

But I do have to tell you, so one of my hobbies, I don't know if

you like doing crossword puzzles.

That's probably kind of an old man thing, I guess.

That's probably why I do them.

Um, But right now I've got a crossword puzzle and it's really stumping me.

Um, I need help with it.

So the clue for the word that I need is overworked mailman.

How many letters?

I'm guessing way too many.

Okay.

That was my joke.

Did you come up with that one?

No, I don't have any original material.

You know that I think you have before though.

I think you have.

Well, okay.

So, so the, uh, Audience knows we are doing challenge words this episode.

So with our challenge words, uh, both Ryan and I and our guest, um,

have a secret word that we have been.

There go my eyebrows that we have been challenged to work

into conversation somehow.

Um, and so you, the audience can be listening, try to figure

out what our challenge word was.

And at the end, we will reveal our success or lack thereof

in using our challenge words.

Um, so off to the races here.

Um, you know, we're oftentimes talking about construction

and construction businesses.

And one of the things that.

You know, I, I often see, um, is that many businesses find that as they

grow and as they scale and increase their business, profits don't really

seem to increase proportionately.

Sometimes, um, best case, maybe they increase some, but not as much as.

The owners had hoped, um, would come along with the growth that they've experienced.

Um, worst case, I think I've seen businesses where profits stayed the same

or, um, even went down despite the fact that the whole organization was working

harder, having more headaches to deal with all those things that should have brought

good results, but they simply weren't.

Um, so today's guest is here to talk about just that.

Um, Susanne Mariga is founder of the Mariga Group, a CPA firm.

Working nationally, but based in Houston, Texas that provides

fractional CFO services and also specializes in tax strategies for

high net worth entrepreneurs, um, graduating from, and I will have to

say it, the Ohio State University.

Susanne worked as audit manager for Chicago Public Schools and did

auditing for some big CPA firms before striking out on her own in 2008.

Um, also along the way, she has some significant construction

industry, uh, experience as well.

Well, Todd Wright, I'm excited to be here to talk about increasing

profits in the construction industry.

Well, let's jump right in if, uh, if that's okay.

Um, Why is it that you think many businesses as they grow, and like I

kind of said in the intro, they grow and they scale and things seem to be going

well, but profits just don't follow.

Um, why is it that they struggle with that sometimes?

You know, it's interesting because I think a lot

of us start businesses because we love what we do, right?

We're tradesmen, we're craftsmen.

And when it comes to a project like building that 16th Chapel or, um,

it's a work of art for us, right?

And, you know, A lot of times we love what we do so much

that we would do it for free.

And I think, you know, it's the American dream, right?

Grow your business, become that seven, eight figure business.

And, and unfortunately, when we're that combination of pressure to grow revenue

while doing something that we love, What happens is we never really focus on what

it's the real outcome that we want, right?

You know, when I think of the accounting equation, you know, it's

revenue minus expenses equals profit.

And, and I love this equation.

I was taught this equation at Ohio state.

I, um, passed my CPA exam for this equation because I can

algebraically solve for it.

Just about any way, but the problem with that equation that we're

taught is focus on revenue, right?

Focus on revenue, sale, drop your prices.

If you're doing any RFPs or competitive betting, you know that it's a, it's the

race of who can offer best value, which is usually zero at the end of the day, right?

Best value is lowest price.

Um, be a good steward to our community, pay our expenses, pay

them on time, manage our debt.

But There's almost like this promise that if we, we do these

things, we focus on revenue.

If we pay our debt, if we pay our expenses on time, then

naturally profits will follow.

But the reality is it doesn't turn out that way, right?

The Bureau of Labor and Statistics tells us that 18 percent of businesses

are going to close in their first year.

After five years, only half will be standing and, and 65 percent of them

won't make it to the 10 year mark.

And, and so really it's important.

What we found is that we have to take an intentional approach to profit.

We have to make profit intentional and, and we do this with our clients

by using something called the profit first method and profit first was

developed by author Mike McAuliffe.

And literally what it does is it teaches business owners to take their profit

first and, and we don't just do it in theory for an accounting equation, but

we actually do it through practice.

We create bank accounts, kind of like Dave Ramsey's envelope system.

We don't want business owners keeping envelopes, but we

do it through bank accounts.

And, and literally what our business owners do is they

create five bank accounts.

They have one bank account.

All the income is coming into this bank account.

All the revenue, all the collections are being deposited

into this one bank account.

And then twice a month money's allocated to the other bank accounts.

So we've got a profit bank account where literally allocating a percentage, a

fixed percentage, every single transfer.

to this profit account.

So we're creating that intentional profit.

You can tell on day one, how much your profit is because you've

got profit in this bank account.

Um, we're also transferring money to an owner's pay account because a

lot of times I ask my, my business owners, Who's your most valued player?

Who's your MVP?

You know, especially with us being Buckeyes, we're used to talks about

MVPs and we're going to say, oh, it's Mike, it's Susie, it's Todd, right?

And Todd is pretty awesome here and he is pretty valuable.

But, um, at the end of the day, you as the business owner, you

are the lifeblood of the business.

The day you walk out of that business.

It's no longer the same business.

And so you as a business owner are the most value player.

And just like you would never allow Mike or Susie or Todd to go without

a paycheck, you're not going to allow yourself to go without a paycheck because

you are the MVP and you deserve it.

And so one of those bank accounts that we're going to transfer to is going

to be for that owner's pay account.

And it's going to be a set percentage.

And I know a lot of companies, they go, okay.

You know, I just want a six figure salary.

And when they're at Half a million are paying themselves a six figure

salary when they're at a million or still paying themselves at a hundred

thousand when they're at 2 million are still paying themselves at a hundred

thousand, but in profit first, we're going to allow you to be rewarded

based upon the growth of your company.

So as revenue is growing, your salary is going to be increasing because it's always

going to be a percentage of your revenue.

The next account that we're going to set aside is going to be your tax account.

Because I can't tell you how many business owners have, you know, come

to me and they're like, okay, can I change from from accrual to cash?

Method because I've got a tax problem now and and we don't want any business owner

being in a tax problem Meaning wondering how am I gonna pay last year's bills?

Taxes with this year's money.

And so instead, what we're going to do is we're going to create a bank account and

we're going to transfer a set percentage of your collections into that tax account.

Um, so that at the end of the year, you're not worried about how

am I going to pay for my taxes?

I've already been reserving this money in my tax account and it's available now.

Now granted, I'm going to use some strong tax strategy.

I'm going to be working with my accountant to make sure that I

minimize taxes as much as I can.

But I'm going to set it aside so that it's there available for me.

And then that last account that I'm going to set aside is going to

be my operating expense account.

So this is the account that I'm going to go, okay, can I afford to

expand into that bigger office space?

Um, can I afford to bring in that executive assistant to help me out.

Can I afford to buy those new computers?

Right?

Because there's a new technology coming out.

And, and what's happening is, is we're working with something

called Parkinson's law.

And what happens in Parkinson's law is I'm going to give it to you this

way, you know, when, you know, for w we have guys on this podcast, so I'm

going to talk in terms of buffets today.

I won't pass that up.

Let's say I'm going on my Caribbean vacation, right?

And, and I, it's all inclusive and it's got, you know, salad bar, fruits,

all kinds of skewered meats, right.

And, and unlimited plate options.

You know, on my Caribbean vacation, I am going to eat like I never ate before.

Right.

And I'm going to start with a salad bar.

I'm going to go into a main course.

I'm probably going to have a few of these desserts, right.

And I'm going to eat a lot differently because my options are unlimited.

Now I'm going to come back to the States and I'm going to have a order

of event, and I'm going to maybe be pitching for some government contracts

and, and I've got to wear my tight suit.

And I.

I'm going to only get these five inch plates, right?

Because we're at an order of event and everything is skewered

on a, or it's on a skewer.

So it's rationed.

A server is serving me.

Um, it's not like I can take some of that good stuff and heap it on my plate.

I'm very limited in terms of what I can eat.

And so I'm going to eat a lot less at my Order of event versus my

Caribbean buffet because my plate size and my options are limited.

Now, the magic is I'm not going to leave any of these, of these,

these dinners hungry, right?

Whether it's a Caribbean event or my order of event, because I'm gonna fill my plate.

I'm going to eat, but I'm going to eat a lot less and eat a lot healthier

simply because of my plate size.

And that's the same way it is with money.

You know, my entrepreneurs are like, yes, I just got PPP money.

I just got ERC money.

You know, they're like, you know, Susanne, I think that I can

afford that bigger office space.

They're like, Susanne, I think I can get a, I need some tax write offs.

Maybe I can get that card as 25, 000 pounds or 6, 000 pounds so I

can get a 25, 000 tax deduction.

And they're asking me questions like that, but when the economy is different,

right, when things are a little bit unknown, like we're in a bit of an

unknown time right now, I think for a lot of us, the questions are different.

The questions are, okay, Susie.

And what can I cut right now?

So I can make it through this time or how do I gracefully let go?

Some of my employees, how does this.

impact my unemployment rate.

Because right now the sales.

having some hard times making payroll.

Again, the questions So by creating these bank accounts and creating

this Operating expense account, you.

I'm now working with an illusion of scarcity and I'm making very

different decisions because I'm working with that illusion of scarcity.

So that's, that's how profit first works and how we start to create

that intentional profitability.

Man.

I love that.

And I got to tell you, um, you actually make accounting interesting and I

think accounting is a lot of things.

A lot of us business owners, cause you're like, right, we didn't go into business

to become an, a, Financial wizard.

Uh, and so sometimes we struggle with kind of wrapping our heads around stuff,

but, uh, you make it really interesting, especially that illusion of scarcity.

Um, so, so I'm going to ask you something completely out of left field here.

Uh, so I was sitting in a meeting yesterday with our CFO and, uh, another

accountant and, you know, they've been both doing accounting for 40,

50 years, literally, um, And they, they actually broke down to doing T

accounts at one time in my meeting.

Do you still do T accounts, even at your time in this industry?

You know, it's a great training tool.

So like as those staffers are coming up, it's just a great way to break down.

This is the flow of things.

You know, it always cracks me up where they're, yeah, well, you

learned that in high school accounting, but that's cool, but you're right.

Sometimes it explains things better than anything else.

Um, so I think it's kind of interesting though, cause you had

your start on the auditing side of accounting, which is, you know, where

a lot of great accountants start.

Um, what kind of drove you to want to do what you're doing today?

So, you know, it was interesting and we can talk a

little bit about tax strategy here.

Um, my dad is actually a CPA.

He owned a CPA firm for over 40 years and he hired me when I was

14, um, to be his bookkeeper.

And, and, and I remember he would train me to do bookkeeping for some of his clients.

Um, you know, he would, he would say, okay, here's a tax return.

Let's see if you get the same answer that I got.

And, um, you know, for him, it was a great write off.

I mean, you know, if you're paying your child less than a standard deduction,

you got five of them like my dad did.

I mean, this is like amazing tax write off hiring your children here.

And, and from a child perspective, it, it gave me a head, a heads up.

And in terms of experience, I remember, you know, when I was, um,

at, at Ohio state and I was doing accounting, I remember my classmates

were struggling and I'm like, okay, um, I'm getting straight A's and I

don't even have to study for this

stuff.

And, and so like when they were graduating, we were graduating,

you know, they say it takes 10, 000 hours or 10 years to be an expert.

Imagine being an expert by the time you're, you're graduating from

college, you know, just because of starting at the age of 14.

So, you know.

Besides being a great tax deduction was great experience.

If any of you guys are looking for, how am I going to keep my child busy this summer?

And, um, now that they've aged out of daycare, consider hiring them.

Um, great experience for your child, great tax deduction for you.

But, um, you know, he asked me when I graduated, he goes, are you

going to come work for your dad?

And I said, oh, heck no.

I'm going to go work for my dad.

Arthur Anderson, you know, in Chicago.

Um, and, and it was great because, you know, you got to

see these really large companies.

You got to see Komatsu.

Komatsu was one of my clients.

I got to see their internal operations.

Look at, you know, some of these, um, you know, Honda operations of how things are

being manufactured, which is really great.

And, um, later on when I started my own business, um, you know, when I had my, my

little girl, um, I started my own firm.

Um, you know, one of the things that I saw was that I saw these

business owners and they would.

Again, be very passionate about what they did, but they had nothing

to show for like every year they were focused on not paying taxes.

And I was like, don't worry, you're not gonna pay any taxes

because you don't have any income.

You're getting earned income credit.

And they were patting me on my back.

Like I was the best accountant in the world.

But years later, when you still are getting earned income credit and you don't

own your own house, you're financing your car, you're not saving for retirement.

I'm starting to get worried because I'm going to retire one day.

And, and I'm worried about.

Um, you know, not being able to retire.

And so that's why I became very passionate about profit first, because, you know,

I think as business owners, you know, we, we can't afford to be waiting for

the government to take care of us.

And so we need to be intentional about creating our outcomes and

creating the things that we want.

And profit first is just the method that I've chosen to, to allow that to happen.

to happen.

Well, I love that.

And I know that in the construction industry, that

just seems to be, um, notorious.

I mean, folks, uh, work their whole life in their business and they go to,

you know, time to hang it up or maybe health reasons force them to whatever.

And they realize they have not really created anything of value.

They really, they really have just been, you know, working because

they loved it so much and almost would have done it for free.

So.

You know, I know one of the things you talk a lot about is helping business

owners draw that connection between profitability of their business and

also their own net worth, their own financial well being, retirement.

Um, why, why is it you think that that isn't more intuitive to us that we

start thinking about that naturally?

Earlier on in our careers,

you know, there's, it's interesting because I think that

a lot of business owners have this critical mass theory and you see this

a lot of times in the Silicon Valley startups where, you know, I'm not

profitable yet because once I hit this critical mass, I'm going to break even.

And, and unfortunately, what we fail to realize is as we

grow our businesses, you're.

Costs also increase, right?

Your variable cost is going to increase.

So your particular cost of construction is going to go up for our

construction contractors out there.

But you're also your fixed costs are going to go up.

You're going to outgrow that space that you're currently in.

Maybe you're going to need a new warehouse to house some of this equipment.

You might need to upgrade your equipment as you continue to grow

because equipment doesn't last forever.

And, yeah.

And so that critical mass that we're aiming for becomes a moving target.

And I think also there's that pressure that we have as business

owners, you know, become that seven and eight figure business.

And there's a lot of focus on selling, but not a lot of focus on that bottom

line of, of what is it that I really want.

And that's why it's important that I would advise any.

Business owner to sit down, you know, the earlier you do this, the better.

What is it that I really want this business will accomplish for me?

You know, is it being able to, um, take vacations every year?

Is it be able to have more free time?

Is it being able to produce a certain amount of income so that I can

take care of my family and retire?

And then you can align that strategy of your business with

those goals and those outcomes.

Because, you know, there's something called Pareto principle.

When we get into profit first, that's that 80, 20 year old, right?

Where, where 20 percent of your clients are producing 80

percent of your bottom line.

You know, if you're going after the low hanging fruit and it's producing just

20 percent of your bottom line versus.

Occasionally getting these bigger clients that are producing

the bigger margins, right?

You're losing out on your, your opportunity to reach your goals.

So figuring out early on that job costing is very important in construction.

You know, not only is how, what's my profitability on this job,

but what type of job was it?

What did we do right on this job that produced This amount of gross

margin, and can we repeat this?

Is it a type of client?

Is it a demographic?

Is it a psychographic, you know, what do I need to do to increase

that profit and repeat those results?

And then, and then working from there.

And then there's a tax strategy standpoint.

You know, it's, you know, if I am a business that.

Employees, mostly contractors.

I'm mostly a closely held family owned business.

You know, I can do some things in terms of tax strategy.

I can maximize my 401k.

I can maybe get a Keogh plan if it's just me and my spouse, and I

can put away close to 50, 000 each.

In my retirement account, which I mean, imagine putting away a hundred thousand

dollars a year in your retirement account.

I mean, that's a 37 percent tax savings for, for a lot of our high

network clients by doing that.

It's like 37, 000 saved in taxes.

Plus you're just, you're getting an expense right off, but you're

just passing the money from your right hand to your left.

Right.

And saving for future Todd one day.

And so, you know, being able to go back and go, what are my real goals?

What are the things that I really want?

And then, and then, you know, Creating a strategy based upon the things that

you really want is, is the missing link.

I think in terms of a lot of, of, of companies that are out there,

you know, what you went talked about earlier was, you know, a lot

of times in business, we just get focused on doing the job, doing what we love.

And it was funny this week, uh, one of our office team members, uh,

passed a birthday and her comment was.

Funny thing is I always thought it would take a lot longer to grow old and I think

if it is business owners, that's kind of our mentality is, you know, time really

isn't going by as quickly as it is.

And I'll worry about this stuff down the road and, uh, shoot

before you know it, there you are.

So I know another topic that you talk a lot about, um, which I love

is, is leadership and, you know, how to company owners lead well, um, I'm

kind of curious Any advice you have for that company owner who wants to

lead well, um, they want to talk about profitability and that type of thing.

But how do they do that in a way that doesn't make their team members

just think of it as, oh, they're just kind of trying to be self serving

here and look out for themselves.

How do you get the team members Vested into the idea of, Hey, we want to make

this a profitable enterprise as well.

There are multiple ways to do this, Todd.

Um, you know, some of the ways that I've seen companies do this and leaders do this

as aligning compensation with performance.

And, you know, it's interesting cause you were, you're like, okay, this is an

obvious thing is something that we all should be doing, but you'd be surprised

how many business owners that I meet that.

When I asked them, how do you determine raises?

They go, Oh, somebody asked for one.

Or because, you know, it's just something we annually do.

We just do that 5 percent raise every year, but there's no math behind it.

There's no process behind it.

There's no feedback behind it.

And, and so what happens is, you know, they're, they're not getting

the outcome that they want, which is greater efficiencies, um, an

all in attitude improvement amongst our team, continuous improvement.

They're not getting anything they want because their raises are not tied to.

Any type of performance metric.

And, and so one of the biggest things I would say is.

You know, be up front with, with your employees.

And this is my expectations of you.

This is what winning looks like in your particular job.

And, and this is where you're falling short.

And if you want to get that maximum raise, you know, we are, our,

our system, we have, um, six, Six ratings that you can possibly get.

If you're a one, we're probably coaching you out.

If you're six, you're probably up for promotion.

That means you're pretty close to perfect.

And our raises range from one to 6%.

And if you're six, you're getting that 6 percent or, or you're

getting promoted to the next level.

If you're one, you're probably getting coached out.

And so really aligning that performance with your.

Your raises is extremely important and doing it in a very numerical way.

That's very transparent for the team member that's being evaluated as well.

For, um, the business owner is, is extremely important.

So those crucial conversations is extremely important.

You know, we've also have a business owners that align

bonuses with performance.

So if one of their goals is to increase sales.

In order to, to, and to receive a bonus, you have to be, we have

to hit a certain metric in sales.

So if our goal is to have a 25 percent growth, then you will get, um, 10

percent of that, that growth as commission, if you are able to hit that.

So again, maybe there's a partial profit share, maybe there's a commission factor

in there, but aligning that performance with those raises or those commissions

is the way that you can approach that.

Very interesting.

That's good stuff.

I love that one to six, uh, parameter, uh, criteria to use and you also used

a phrase in there that, um, is the name of a great book, Crucial Conversations.

I'm guessing that's probably a book for you're familiar with, but, uh,

a great share a shout out for that.

A great book for folks who are looking at, you know, how do I

have those tough conversations?

How do I create an environment?

Uh, where I can sit down and have serious conversations and make

folks feel safe and respected and honored and all that type of stuff.

Well, what are some of the key metrics that you feel a business

owner should always be watching in their business in terms of, you

know, numbers, metrics, so forth?

So for construction, I'm going to go Pacific for

construction because that's a lot of our audience here today.

First of all, job profitability and not just dollars.

When I'm looking at.

Job profitability.

And literally what that report looks like is I have job, a job,

B job, C every single job is on this, this, this Excel sheet.

And I'm not just looking at the numbers in terms of dollars of profit.

I'm looking at my percentage of gross margin.

Like what is the gross margin?

Meaning revenue, less cost of construction equals gross margin.

What is my gross margin percent of my rent.

In terms of my revenue, so gross margin percent job profitability

reports are extremely important.

The next thing I'm looking at is the financial statements, right?

And I'm looking at overall trends.

Like, how did I do versus last year versus.

Other months, this month, this quarter, um, I'm looking at ratios in terms

of percentages of categories from a P and L standpoint to revenue.

Um, because I want to see, you know, like, what's my advertising costs?

Is it 20%?

Is it 3%?

And, and is it producing a 10 X on.

The cost that I'm investing in this advertising because advertising should

be generating revenue with that.

Um, I'm looking at my cashflow statements.

I'm, I'm, you know, how is my cash?

Is my class growing?

Is my crush not growing?

Um, is my debt growing?

And, and, and that's the reason why my cash is staying the same

because, you know, we don't, we don't want to be touting it.

Yes.

I got great cash balances, but my debt is also rising just

because I'm not paying my bills.

Right.

We, we want to make sure that we're managing that debt appropriately.

So yeah.

Really creating that financial package that allows you to monitor and

really keep a pulse on your company.

Um, and you want to be looking at this at least monthly.

Um, you know, I, I think another great report to look at is my lead source,

you know, where are my leads coming from and where do I need to be investing at

in order to continue to get more leads?

My, my acquisition costs per client is very important.

Interesting, good stuff.

Well, I'm kind of curious, what does your relationship look like with your clients?

And I know that, you know, you have clients where you actually play

that role of CF or a fractional CFO, um, maybe tell us a little bit what

that looks like or what your other clients relationships look like.

I mean, you just the heroic one that sweeps in and takes care

of things and then flies off.

Or is it more of a longer term sort of relationship that you

develop with your clients?

So it's definitely a very intimate relationship

being a fractional CFO.

Um, you know, I, I take a very limited amount of clients because

I do work with them very closely.

Sometimes we talk a couple of times a week if, if that's what's needed.

If we've got something major that's happening on the horizons of a

project or a software implementation or to that effect, um, usually

it starts off with a site visit.

So I get to actually meet their teams.

Sometimes I've gone to some exciting locations.

Um, let's just in.

Philadelphia last week, visiting a client and, and, you know, because

there's nothing like walking the floor and shaking the hands of the people

that, that make up this company.

And not only that, but you get to observe their process.

You actually get to sit down and go, okay, this is how you do things

because you'd be surprised when you ask the question, how is something

done versus how it actually is done?

It can be a lot different.

So being able to walk the floor is very important with that.

Yeah.

Um, you know, I also take a pulse of, you know, what is their current operations?

Like, what are, what are the things that we can do right now to stop the bleeding?

That might be a 30 day cashflow projection, meaning, okay, these

are what we're expecting expenses to be coming down the pipeline.

Um, this is what we expect our cash inflow to be over the next 30 days.

And how do we make sure that we're able to meet that forecast and have

enough cash to make that next 30 days?

It's going to be really important.

So we might get into budgeting.

Um, you know, the next big thing that happens is how

are we pricing things, right?

How are we pricing our jobs and our contracts?

Are we doing cost plus?

Are we measuring for inflation that's happening?

Because I think that's a thing that A lot of us business owners, especially in the

construction area, need to be concerned about how are we being affected by

inflation and and what's, what do we need to expect in the near future with that?

Um, and so pricing becomes a very big, important component.

And of course, later on, we get into tax strategy and so on so forth.

So that's a little bit of just.

Some of the common trends that we start with Todd.

Very interesting.

Any particular client success story stand out in mind?

Um, someone that, you know, you really helped them kind of see

the light and help them get to a new future or preferred future.

Absolutely.

You know, um, I actually wrote about one of my clients in my book, um,

Mike McCallots and I wrote a book together and even if you're not a

minority, it's a great book to read.

Um, I do talk a little bit about construction in that book, but it's profit

first for minority business enterprises.

Okay.

And, you know, it goes having a tax strategy, but I talk about,

um, some of my favorite clients.

I talk about Jane and Ed and, and, you know, when they started their

business, they were just excited because.

They were starting a business and, and Jane actually, it's

a wig manufacturing company.

And, you know, Jane started her business because she was experiencing alopecia.

She was losing her hair and she had watched YouTube videos on how

to create one for her personally.

And at the time she was working in a shoe store and one of her clients came in and.

And saw the wig on Jane's head and was like, I, I want that wig.

I'll, I'll pay for that wig.

I'll pay you a thousand dollars for that wig.

And her client was going through cancer treatment at the time.

So her client was losing her hair.

And, and for her client, that meant that, you know, she would have.

A sense of pride, you know, and being able to, you know, be a woman that

once had a flowing glory, you know, she would be able to have that for

a moment just by having this wig.

And Jane realized it was a business, but like many business owners, you

know, Jane just loves helping clients.

She loved helping people.

Look their best and feel beautiful.

And, and what she realized was like a lot of business owners, you know,

they worked really hard, but they didn't have anything to show for it.

And so I got the privilege of working with Jane and Ed.

I got to help them with their pricing.

I got to help them with their procurement.

I got to help them with their, um, advertising, um, And, you know, they ended

up becoming the first millionaires in their, their family because they literally

said, okay, we want to continue to help people, but we also want to balance that

to you with, with their personal goals of being able to create generational well,

and so profit versus an amazing process.

It's.

Um, has amazing, amazing results.

You know, they were able to buy their own building and do great things

because of implementing a system that created intentional profitability.

Wow.

And who knows Ryan and I both being follically challenged.

Maybe we need an introduction to Jane and Ed.

I don't know.

Tell us a little bit about some of the qualities you like to see in the leaders

of a business and, you know, Do those qualities have to just come from the owner

or how do they inspire those into more?

Some of their key leaders and mid level leaders as

well.

Well, Todd, I think that the owner sets the pulse for the company.

Um, I think as leaders, we cannot expect our, our team members to become what

we are not willing to do ourselves.

Right.

So I'm a big fan of that, that servant leadership from that perspective.

Um, there's just a different level of respect when they

know that you're willing to do.

I think about those war movies and we've all watched those war movies where

they're, they're charging the enemy line.

And it's interesting because you don't see the leader on the back on the cell phone

talking, Oh no, he's out in the front.

He's charging with his men.

Right.

Because If, if they're about to lose their lives, he's going to

be equal in that, in that pursuit and what he's willing to give.

And so it's about charging that front line, just like a war movie.

And you know, I think with a, of a leader, I think one of the biggest

things is being courageous, right?

Being courageous and being bold, um, to do the right thing, whether that's, we

talked about those crucial conversations.

When things are happening that are not in line with the mission of the company

and the values of the company, being able to, to have that, that gumption

that I'm not going to allow this.

I'm going to actually approach this.

I'm not going to allow mediocre to be okay, because when we allow mediocre to be

okay, that doesn't just affect our morale, but that affects our profits also, right?

When we allow mediocre, because we don't allow people to rise to be their best.

I think that But most important thing is being courageous is extremely important.

I think the next thing that's important for a leader, especially

if you're a scaling business, because every business is different.

Is taking a standpoint of, I'm not going to be able to

solve all the problems myself.

And at some point it becomes not just about the how, but the who,

the who am I going to have around me that's going to help me solve these

problems and be able to identify.

That right person to be able to step into that role, especially if you're running

That seven eight nine figure business that who becomes more important than

the how in many cases um, and and being able to Understand that person's ideas

and really rally behind their support.

So I would say the first two is being courageous and not being afraid to

Realize that I'm not going to be the one that solves all my problems.

Oh, that's good advice.

That's great stuff.

Any challenges, you mentioned inflation earlier.

Um, any challenges that you're seeing, uh, on the horizon for business owners?

I think that the biggest challenge that I'm seeing right now is

that we are, and it's been happening for a while, but we're navigating an

unknown time, meaning that, you know, the stock market is All time high,

but reality is it's in flux, right?

It's, it's in flux.

You know, you're hearing comments that, that it's artificially high and

then, but maybe it might not be right.

And so I think that it's important to take a stance in your business that you're

profitable no matter what your revenue is.

And that's, The, you know, so not just having a budget, but having a process

that allows you to be profitable no matter what that revenue is.

And so we talked about profit first.

We talked about setting aside percentages, percentages, going to

profit, percentage is going to owners pay percentage of going to tax.

And so, first of all, you know, whether you're Eight figures in

revenue or seven, you're still going to be profitable, right?

Because you're, you've got a process in place to intentionally make that happen.

I also think it's important to be conservative about your expenses now.

So create that budget and adhere to that budget.

Avoid those long term commitments, those five year leases, you know, those

five year copier leases, avoid those.

Um, and then.

Because you want to remain flexible.

For example, you know, if the market changes, real estate may become a

bargain and you want to have cashflow to be able to buy those things.

And so staying nimble is extremely important right now to be able to

take advantage of those opportunities.

I like that, you know, staying a little bit

cautious and conservative and, and being nimble in that process.

Good stuff.

Um, your own business, I'm kind of curious, What do you enjoy about

what you're doing and, and do you have any particular goals for

the future of your own business?

So I, um, I, I love what I do.

I love helping clients achieve their goals.

I love them.

I love being able to see them by their own buildings or hired or spouses.

I think that's become a very popular trend lately.

I've seen a lot of clients.

Retire their spouses.

That was their goal is to build a business where their spouse

doesn't have to work anymore.

And, and I've seen quite a few of that happening lately.

Um, you know, that, that being their, their Christmas gift to

their spouse is being able to put in their two weeks notice lately.

Um, and I think that's a beautiful thing.

Um, that they're able to achieve those goals.

You know, it's interesting because I actually just sold a traditional

accounting tech and tax practice.

And it's interesting because, um, you know, for many years, for 20 years, I ran

a traditional accounting and tax practice.

Um, side by side with our consulting practice, which

is our fractional CFO side.

And, um, it was interesting because I ended up putting on the marker, a

broker had contacted me and we had implemented profit first many years ago.

Um, Mike McCallum squares, I was one of the original implementers and

original profit first professionals.

I think there were like 20 other people in the room.

There was definitely a lot of air, but there was 20 other

people in the room, I think.

And, um, and when businesses sell, they sell for either a multiple of EBITDA or

they sell for a percentage of revenue.

And I did not expect this, but we put our business on the market with a broker

and within four weeks, or actually within two weeks, we had four, four offers.

And, um, the, our broker was like, you know, that doesn't happen.

That doesn't, you realize just what happened.

You've just gotten into a bidding war because of your

practice being so profitable.

And it really was profit first.

It was being intentional about how we created a business.

It was intentional about the clients we chose to serve.

And.

intentional about Pareto principle.

And, and it, it paid off.

It allowed me technically to retire at the age of 46 and just work with a very

select view of fractional CFO clients.

Wow.

That's awesome.

And yeah, practice what you preach and yeah, that's good stuff.

Good stuff.

Thank you.

Well, Susanne, thank you so much.

Like I said, you make this, uh, you make accounting interesting.

I really enjoyed this and you've got, um, such a great way of explaining

things and uh, kind of painting pictures, painting pictures with your words.

So I love it.

Um, well, we are close to wrapping up what we call the business end of things.

Is there anything we haven't covered yet that you wanted to be to be

sure to share with our audience?

so much.

You guys have been amazing hosts.

Um, you know, the only type of advice I would leave people with

is, you know, Simon Sinek, start with why, start with why, what was

important to you when you started his business and get back to your why.

I love it.

Simon Sinek has some great stuff.

Um, yeah, we're often watching his videos and referring folks to them.

Very good.

Well, before we close out, I have to ask you if you're willing to participate in

something we call rapid fire questions.

So these are seven questions you have no idea we're going to ask.

All you have to do is give your quick answer.

No one has ever refused us before.

So are you up to the challenge of rapid fire?

Let's do it.

I'm scared, but let's do it there.

They are painless.

I promise.

Um, Ryan, you want to start off with the first question?

Yes, I would love to.

Have you purchased a new product or service in recent memory that has

been a real game changer for you?

Yes.

Um, that would be my.

My snap scan, Fugetsi snap scan scanner, that thing can just audit proof your

business and keep all your receipts going.

I'm sorry.

I'm an accounting geek.

I I've heard about those before and that they're, they're

pretty incredible worth every penny.

You know, it's funny.

I had bought one of their very early ones.

In fact, I bought a couple of them, one for home and one for work.

And over the years I've got away from using them because it.

Seemed like their technology was just kind of replaced by the office

copier and scanner, but, uh, I need to look at what they can do today.

That's cool.

Well, question number two, um, what would the first grade you have said

that she wanted to be when she grew up?

She said she wanted to be a doctor, poor baby.

She didn't notice.

She hated the sight of blood.

That can make that kind of hard.

Well, you've kind of become a doctor though.

You're a doctor for businesses.

So look at it that way.

Thank you, Todd.

You're kind.

Question number three.

Do you prefer the top or bottom half of a bagel?

The top.

I like the top.

Yeah.

That's usually where the good stuff

is.

The bottom has a weird texture.

I'm with you.

I'm with you.

Question number four.

Um, what would you like to be remembered for at the end of your days?

I hope I changed your life.

Cool.

For the better.

I can tell that you're doing that.

That's good stuff.

Question number five.

You're trying to survive a zombie apocalypse.

What one person do you want to have on your team?

I would say my husband and he's a pretty sharp guy.

He could handle a zombie.

With a broom.

With a

broom.

Good stuff.

Good stuff.

Question number six.

If you could instantly master one new skill, what skill

would you like to master?

That's a

good

one.

Oh, wow.

You stomped me on this one.

I would like to do magic.

I would like to be a magician.

I can make anything.

We've never had that answer before.

That's a good

answer.

I like that.

I do too.

Very good.

Last question.

What's your favorite weekend activity?

Oh, I'm all girl on this one.

Going away to a spa, a spa retreat.

My, uh, my wife would be there with you.

Sounds good.

Well, very good.

Well, Susanne, thank you again so much.

This has been a pleasure.

It's been a great deal of fun and very informative, um, for folks that want to

get in touch with you, or if you want to give a shout out to your book, um,

you know, anything you want to give a shout out to go ahead and do that.

And we'll put that information in the show notes as well.

Thank you.

If anyone's interested in reading our book, um, you can

order anywhere that books were sold, Amazon, Barnes and Nobles.

It's profit versus minority business enterprises.

You do not have to be a minority to read it.

In fact, I've had many non minorities write me and go,

Oh my gosh, I love this book.

Um, check this book out.

Um, it is a great book.

Um, and.

You know, we talk about RPS, we talk about bidding, we talk about, um, pricing.

Definitely check the book out.

Very good.

Very good.

Well, thank you so much.

And I know that I found you on LinkedIn also, so you can find

Susanne on LinkedIn as well.

It's a pretty easy way to, to connect with her too.

So this has been very good.

Um, well, so our challenge words, uh, Susanne, I know that you got

yours in, yours was Caribbean.

Yeah, you worked in a couple of times there, Ryan, did you get yours in?

I didn't let you talk.

Well, it's okay.

I just kind of chalked it up to, I'm not getting it in.

I'm going to lose this one for the first time.

I think as soon as we started my, I forgot to lock my dog up and my

dog started barking like crazy.

And I had to mute my mic and I was trying to text.

People like who's home.

Can you block the dog up?

And I was totally distracted.

I was listening.

So I apologize for not being a bigger part of the conversation, but I failed.

My word was fire starter.

And I'm like, can I call my dog a fire starter?

Like, I don't know, but I just, I'm like, I'm just going to lose this one.

And I accepted it.

I thought you were saving it for when you, uh, asked Susanne

what her favorite weekend activity, and he'd be like, you know, do you

enjoy getting the grill out and the fire starter and starting that up?

I mean, oh, you had the perfect place to use it there.

I, I didn't think that I looked, I did look at the rapid fire

questions and was trying to figure out how I was going to work it in.

And I'm like, uh, maybe it's just, it's been a, it's been a short, but long week.

And I just, I gave up, I gave up too early.

That was, that was your first time ever to, to not get it in.

So it

was, it's probably going to bother me all weekend.

Well, we can always edit it in somehow.

Oh, I totally

could do that.

So my word was heroic, which I squeezed in there as well.

Well, thank you again, Susanne.

This has been a real pleasure.

I enjoyed it a great deal.

Thank you for having me.

I did want to mention, I did have another gift.

Um, a lot of people wonder what percentages should I be

transferring and profit first?

I do have a free download that you can.

Download is called profit map.

co.

So if you go to the profit map.

co website, you can download a chart that shows you based upon the

size of your company, what those percentage allocations should be.

Oh, wow.

Good stuff.

We will make sure we put that in the show notes as well.

Thank you.

Appreciate that.

Everyone loves free stuff.

I'm not going to turn that down.

Well, thank you to our audience for tuning into this very special

episode of Construction Disruption with Susanne Mariga of the Mariga

Group, and that is M A R I G A group.

Please watch for future episodes of our podcast.

We always have great guests, just like Susanne.

Don't forget to leave a review, please.

Until the next time we're together, keep on challenging, keep on looking

for better ways to do things.

And Above all, keep on impacting the world positively for others.

Um, have a positive impact on those around you.

It may just be a kind word or a smile, um, but do whatever you can.

Uh, so God bless and take care.

This is Isaiah Industry signing off

until the

next episode of Construction Disruption.

This podcast is produced by Isaiah Industries, manufacturer of specialty

metal roofing and other building products.