September 24, 2024 • 20 mins
This is the "What If" episode, Kevin. What if? Disaster planning for your business.
Oh my gosh. What if? This is what keeps me up at night, and I don't think we've ever talked about it. But it's all like the conditional, how will I survive, yada, yada, yada. And some of it is like easy to figure out and some of it not so much.
Join Justin Miller and Kevin as they delve into disaster planning for small businesses, covering topics from staff poaching and machinery breakdowns to natural disasters and industry changes. Learn how to prepare for the worst while keeping your business running smoothly. This episode is packed with insights and strategies to safeguard your business from unexpected challenges.
From practical steps like documenting procedures and redundancy planning to exploring the broader implications of industry-wide disruptions, this episode is a must-listen for any business owner looking to build resilience and peace of mind.
Thanks for listening to the Profit 911 Podcast. Be sure to subscribe and leave your comments. For more information on how Profit 911 Consulting can help grow your service business, visit Profit911.biz.
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Episode Transcript
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(00:03):
Marketing, entrepreneurship, and all things small business.
You're listening to The Profit 911 Podcast. Now, here's your host, Justin Miller.
Episode 55. Wow. This is the what if episode, Kevin. What if?
Disaster planning for your business. Oh my gosh.
(00:25):
What if? This is what keeps me up at night, and I don't think we've ever talked
about it. But it's all like the conditional, how will I survive, yada, yada, yada.
And some of it is like easy to figure out and some of it not so much.
So my question to you, before I lead you to what I've already fixed. Sure. Okay.
(00:47):
Is like, if you were taking down the company, what would you try and interfere with? Ooh.
Not as like a direct competitor. Think eviler than that.
Sure. it would probably have to do with your staff i
mean poaching them or poisoning their
mind no i mean poison i don't
mean poison like kill them literally kill them no i mean like like get them
(01:10):
to think differently about your culture or about working for you or okay you
know so this that's like the hardest one to cure we can start there yeah so
there's more there's several you've got you've got yeah we actually we've had
this exercise before called take down the company or whatever.
I can't remember what we called it. Something dinosaur themed,
of course, but. Naturally.
You know, as everyone like, you know, come up with three way,
(01:33):
like break into groups, come up with three ways, like if you are trying to kill
the business, what you would do.
Wow. Yeah. I don't think we've ever talked about this. And I continually think
through that all the time.
Like, okay, like, because as you like start to get a little bit of success,
you don't want that shit taken away from you.
Well, no, that's true. How we keep this thing going. Yeah. No.
So staff is, of course, like a major one and the hardest one.
(01:56):
So currently we're like a staff of nine or 10 here and a staff of nine or 10
is better than a staff of two, three, or four.
Just because if you lose one of them, like you didn't lose a third of your workforce. Yeah.
That being said, at the scale we're at nine or 10 is still a significant problem.
So actually behind the scenes, like we're trying to get to about double that.
(02:21):
Okay. And when we get to double that, then each Each position should be a little
redundant, not meaning like there's extra excess time. Yeah.
But at least multiple people know how to do every job. Okay.
So we're actually in the process of documenting out standard procedures a little
better, like all this boring shit.
We do have a staff member that's amazing at it and she's really helping out. So shout out to Gabby.
(02:42):
There you go. But we're documenting all the jobs and trying to make it survivable for any absence.
You know, it's the old gets hit by a bus thing. Sure.
So we're planning for each of those jobs. What happens if that person's gone?
Yeah, some of them damn near would wipe us out at this point still.
Is that because you have the right people and they're just rock stars or is
it because you don't have the backup? They're invaluable.
(03:05):
Yeah. They're here because they are awesome and they're doing a great job.
But, you know, if you take one of my salespeople right now, that's half the
sales team. Sure. That's a significant problem.
So we'll be growing the sales team to where if you take out one of them,
you took out a quarter of my sales team. One of them is a spy and they.
Yeah. I mean, it's shit like that happens too, right? You're right.
(03:25):
Or, you know, health happens. You know, there's all kinds of stuff.
But it is the proverbial hit by a bus, but it could be sabotage.
It could be just move. Maybe they move to a different location. Sure, yeah.
You know, there's things that are innocent that happen that staff members lose.
I mean, it's naive to think they'll be here forever.
Yeah. So, yes, we're currently actually pushing growth, not just for growth's
(03:47):
sake, but for stability's sake for any individual departure,
doubling up on jobs. We have one graphic designer here right now.
Yeah. Yeah, but you also know where if like tomorrow she got hit by a bus,
you have other may not on staff, but you would know where to go get that done.
Okay. So that's the disaster plan, right? We know we could use a third-party
design service. It wouldn't be quite as good.
(04:07):
There'd be a lot more explanation and babysitting and consuming a lot more resources.
But yes, if that person is gone, what does it impact?
Where does it go? Where do we go next? And she's documented a lot of the processes.
So if we want to hire it in-house again, are we starting in a better spot than
when we started originally?
Okay. So yeah, staff, it's the number one. You hit it right out the gate.
It's the hardest to plan for.
(04:29):
I don't think you can ever be fully prepared. This maternity leave that probably
by the time this episode plays is in place.
Sure. You know, has caused a desperate scramble to write down and procedurize
a very detailed job here.
Yeah. One of the most detailed, one of the most structured as well.
So good for documentation.
Okay. But also it means there's a a lot of documentation you know
(04:52):
and there's some positions that are overhead type
position well i mean to an extent i am but our
business office manager bookkeeping type
positions you know there's there's not enough work for that to be 80 hours a
week of work to have two until we're at a little larger scale so we're growing
towards that so what else besides hr which is again you hit the major one and
(05:15):
it is the thing that keeps me up at night more than anything else is if we lose
so and so you know by the way if i think if i lose you and like i don't see
an immediate impact like you probably should be fired oh yeah that's true i
can't think of any of those right now so we're we're good that's good yeah see
that's the first thing i would have gone to i i mean.
(05:35):
I, man, I don't know what would, I mean, short of some kind of catastrophic
industry thing that causes all your clients to no longer be in business.
Let's take a, there's two different things there. So catastrophic industry things
occurred during COVID. Remember all the supply chain issues? Yes.
It actually became almost impossible to get envelopes.
(05:57):
I remember that. I used to think you were, when you first talked about it,
I'm like, you're kidding, right? Right? No, nope. I'm not.
It was like getting gold from Fort Knox and you can only get so much.
Yeah. They were allocated.
It wasn't a case of they wanted to sell you stuff. It was a case of how little
can we sell you and keep you as a long-term client?
Photo booth paper was like that for a couple of years. I was like,
what do you mean I can only buy a box? I've got 17 gigs coming up. I can sell you a box.
(06:21):
So that means supply planning. How much do we keep in reserves?
Okay. And it's not as much as it was during that period of time.
You're not hoarding it now. No, which now if like something like that ever happens
again, like the next day, everyone's going to be mass ordering.
It'll be a problem. But sure. Okay.
But yeah, certainly we're looking at inventory levels.
Closely related then is machinery. So breakdown.
(06:44):
Yeah. Breakdown, repair, upkeep on the inability to find a replacement because
you have pretty specialized machines.
It isn't like I'm gonna go buy an HP printer at Walmart.
Yeah, no, there's and there's very few people to even service them.
So it's redundancy in machinery.
We have backups for every critical piece of gear. We have multiples.
(07:06):
Now, currently, we're not operating with an offsite backup as well.
Now, certain players within the industry actually are multiple location due
to natural disaster. Yeah.
So we are still susceptible to that risk. Like a tornado blows down.
I would have never thought about that.
Do you have the capability or, I mean, obviously your costs would go up,
(07:27):
but say a tornado blows through here and your whole building's done,
but you still have all your servers and stuff. Could you outsource?
Could you get all your work done somewhere else and you would just pay more
because they're doing the work for you? Or would you be... There would be trade-offs for sure.
So we've built kind of a specialized thing here that the way we do things doesn't quite
fit most shops so we would
(07:48):
be we'd be down for a while there'd be stuff not going out if everything
got wiped out now if it's a machinery breakdown you
know we've we've accounted for we have a bunch of presses we
have like every machine like every time i come in here there's a new machine
and you have to explain i mean they all look so foreign to me because i don't
know what they are and then you explain i'm like oh yeah that makes sense yeah
yeah so yeah we just built our second shop within the same physical facility
(08:11):
that is a completely redundant shop like you could You can put separate staff
down there and they can produce the same thing. Okay.
What else before I give them? Oh, you said clients disappearing, didn't you?
Yeah. Like what if, I mean, I'm not saying that suddenly the government's going to outlaw accounting.
But I mean, it's like, what if there's a whole industry that no longer is as
valid or sees all this attrition where suddenly your biggest generator of leads or clients go away?
(08:38):
So to us, that's the whales.
You know, we have a couple of clients that are really big for our business and
we have a couple of referral sources that are really big.
And that certainly is scary.
You think that's great if you get a massive client, but I'm thrilled and I also
see the risk if that client leaves of what the damage would be.
(08:59):
So I have to make sure I understand the implication of that.
And we actually work, we're working really hard to diversify client types,
referral sources to where, yeah, there'll be a very real impact if we lose some
keys, but we would be able to survive.
Well, it's hard not to have those whales because they bring in so much business.
But at the same time, you're right. You have to be able to have enough other
(09:20):
business that if they go away, you're not down 60%. Yeah. And you kind of mentioned the tornado.
So we had what, the derecho blow through a couple of years back and we were
down a couple of days. So we've put it in the natural gas generator now.
So this was an easy one. Like this was, I don't know, 10 grand or something.
And I can account for this particular downside. side so if power goes out now
(09:46):
we got backups our servers can run our staff can work remotely.
That's a fairly easy one to account for it's not like fun
and exciting to purchase that particular thing but yeah i'm kind of a nerd so
actually it was but for most people like it's not at the top of their list you'll
admit it i think the electricians love me we're reconfiguring things every six
(10:07):
months yeah keep some working yeah so we have that you know you want to go very
physical in the disasters.
You know, if we have basements here in the Midwest, we got flooding issues.
We've got sump pumps and backup sump pumps and backup electricity for the sump
pumps. But you have to have it.
Water tends to damage paper. Those are very obvious things, but they're important.
(10:29):
They can wipe us out real quick.
So internet, it's necessary.
It's kind of redundant in that we have a cell backup. Can we really operate
at any capacity with that? Not really, but we're not completely off the grid.
Production does stop if power's out. We don't have enough generating capability
right now because currently we can come back up with double shifts and we can
(10:52):
get back up in pretty quick order.
But if volume increased to a point where it was justified absolutely
we would have a massive diesel generator outside and we would continue operating
pretending we're a hospital even though we're doing junk mail that's right you
know if it wipes out the post office's ability to sort the mail then it doesn't
matter if we can produce it wouldn't matter yeah yeah and no the post office
(11:13):
isn't going anywhere last quarter they lost 2.5 billion dollars and they're still there so,
it's a great model i don't know where the money comes from i don't either we
give them a lot i I don't know what they do with it. They still lose it.
Let's see. What else was on the wipeout stuff? I think we got most of them.
Personnel, for sure. Physical plant. And by the way, if we were a more standardized
(11:36):
print shop, there actually is at least one or two organizations I know of that
all they do is disaster backup recovery for physical print facilities.
So you could shift your workload over to them. And those are going to be maybe once in a lifetime.
So you know they're there. it's not like you're going to go to them,
ever unless you absolutely have to have it but then they're there so really
(11:58):
the cost at that point is not irrelevant but it's just the cost of the disaster
business yeah I mean the downtime is is detrimental yeah I mean if our building
got wiped out right we got it insured but how much downtime would there be would
we still be in business you know well yeah you can't rebuild in a week,
it's like where can I get all this specialized equipment from that like never
existed to start with and where's the cash coming from,
(12:21):
So we got that. Yeah. I would say number one on my radar though,
all the equipment stuff within the past couple of years, I keep walking through the shop. Okay.
If I took a baseball bat to that, what would they do?
And so all those have been covered pretty well. The proverbial gets hit by a bus situation.
(12:41):
We're still as susceptible as anyone to it. A survivable, but massive impact.
Even including to me. So I guess that's worth mentioning.
There is a document that says, based on the current point in time,
if I'm wiped out, here is what I think the business is worth.
Here is who to call to verify that. Here are potential buyers for it and what
(13:06):
to look out for with each of them.
And here's how you make the judgment call, whether this thing operates without
me or whether you close up shop and how you do it.
So that does exist. this time it's not not for the benefit of the employees
necessarily as much as my wife sure well and it's i mean you and i've had we
joke about this too i mean the business you sold me and what i've grown it into
(13:27):
and the other stuff is nowhere near the scale but whether i would,
tell her otherwise at some point it will always be
in katie's mind like if i died and got run over by a bus tomorrow
it wouldn't matter what the insurance was she would call you and
say what the hell do i do with all this kevin stuff all this dj stuff what do
i do with all this stuff she knows that you would at least be able to do it
(13:49):
and and be you would be like all right well i'll do a solid for you because
he was my friend or i sold him the business it's i get that and it's funny because
no one likes to think about that but then i also don't have to think.
Gosh what is going to happen with all that stuff if i'm gone it'll get taken
care of don't worry we're going to donate it kevin that's perfect just donate
it for tax write-off that's right.
(14:12):
No, but I mean, I've gone through the exercise and that's part of growing the
business further as well.
Like right now there's like a couple of options on what would happen that changes
as we hit a little bit different scale and certainly value changes as well.
And the less I'm here, the more it's worth. Makes sense actually.
And yes, I would like it to continue on, but not if it's a detriment. Yeah.
(14:35):
How else would we take this thing down? Is there anything the government could
do regulation-wise or tax-wise?
Yeah, I mean, you can't account for them. No, because that could change at any
time. You got to roll with the punches on that one, for sure.
Yeah. I mean, if the post office goes away, obviously, we're screwed with the
current model. We'd have to become a digital agency again. Yeah.
Yeah, but you're right. I mean, if the losses to this point have never closed
(14:59):
it, it's not going to happen.
Yeah. Yeah. Yeah, it's pretty much natural disasters and people poaching would be the biggest ones.
So you just keep your people happy and do what you can to ensure against the rest.
Well, and a lot of times people, I guess it's even in my, I have,
I mean, I don't think it would ever, I don't think it ever would get to the
point where you would get a call from me and I would be like,
(15:22):
look, I've got six weddings this weekend.
I know you haven't, you haven't DJed a wedding in 12 years or 20 years,
but I got two people that are in the hospital and four more working and I need you.
I mean it's a crap you better hope that i know you got something just programmed
which you just yeah i got a playlist for you the bride knows that you're coming
i've already given her a discount.
(15:43):
You know i hate to say it but that industry was way more stressful for me than this one,
and this is crazy because this one is so much bigger and so many more things
and that to me provides security to me i feel much better about that that's
interesting it's also not like immediate time urgency stuff and we talked a
little about that i was talking about the presentation I gave a while back.
The presentations to me...
(16:05):
They're not nerve-wracking. I've given them, I know my stuff,
but they kind of lock up my brain from doing other things, preparing for it.
Each one, even if it's the same thing over and over, each one has the ability
to have an unforeseen set of circumstances, good or bad.
Well, and I'm thinking about all the behind-the-scenes shit from my two decades in the event world.
What could happen? I'm preparing for all contingencies for a live event,
(16:28):
too, which is much different than here because the impact is not immediate here.
No. Even if the power goes out and the generator fails, it's not the same as
a wedding reception, the power going out to generate a failing. Yes.
Which we were planning for that shit in that company, too. That's true.
We had a generator and we had these plans.
Well, there's the guarantee of if at your wedding I'm going to have a backup
(16:51):
system or I'm going to have a backup photo booth.
I can't, I mean, maybe five times since I bought your company have I needed the backup gear.
But the one time we didn't have it i ended up
giving a hundred percent refund because one of the guys that i
inherited from you forgot to bring a backup printer to galesburg yeah
and most of the things a good portion of
(17:11):
the things we do here like i could get a do-over would it
cost me like what i might have to refund the whole thing and
i have to lose a bunch of money uh-huh but i i still can earn
back trust yes i'm not going to get a chance to do that wedding over no
absolutely not no so you know the live event world has
a different level of stress if you care and and
we we talked about recruiting and when i was in that business that's what i was
recruiting for as well was people that cared and understood like
(17:35):
the implications of of what they had the
ability to have an impact on even if they weren't being paid to do
xyz like not doing xyz would cause
a problem yes yeah it's not
always what you do it's sometimes it's what you don't do in our in that well
and when i say our you're still i mean i still grandfather you into something
you no longer do i set up the mixing board today kevin that's good i'm impressed
(17:58):
uh it was it was plugged in properly i didn't see you make too many adjustments
yeah no everything was good you still got it yeah.
I'll still have to get a brighter refund probably.
Or a discount. I'll be like, hey, he sold me the company. We did have the money
back guarantee in that business. Yep.
Now, I don't have an official money back guarantee in the current one because
(18:21):
I can't guarantee results.
Yeah. But if we screw something up within our control, still money or credit.
I think in a way that's different.
I mean, you're taking care of people.
I mean, I learned this from you. I didn't have a money-back guarantee in my previous DJ business.
I book business because of that. There are times that that is what seals the
(18:42):
deal with the client when I say, I guarantee we're going to do this, this, and this.
Well, and sometimes if you didn't spend a lot here and you were big enough pain
in the ass, then I just give your money back even if I lose money to get rid of you.
It's not an official policy. Don't everyone become a pain in the ass if your campaign doesn't work.
But what's the threshold? old no but
(19:03):
we do care and if it's if it's something that
you know we were paid to do and it's within our control then of course
we do what we can to make it right so there you go it's
called take down the company to do the exercise in your
business come come up with five or ten things that could kill the business see
what what's within your control how often do you do this is this an ongoing
thing i mean are you like thinking about this all the time i mean it's in my
(19:25):
head all the time that's that's like my so i'm not in operations right yeah
like it's It's more strategic and strategic operations is what can shut us down.
Well, that's the thing. Maybe I should think about it more. I don't think about
that that much, but maybe I should.
That's just available bandwidth, right? So I have people who are doing other
stuff so I can think about this. Yes, and that's true. And yes,
these are situations that are unlikely.
(19:46):
Well, staff leaving is likely. That happens. Sure.
But some of them are a little ways out there unlikely, but the impact is big
enough that there should be a plan of sorts.
So there we go. If the internet completely goes down around the whole world, we're in trouble.
But beyond that, we're good. We'll be back next time with...
Hey, maybe we can get the Jurassic branding done for this. Yeah,
(20:07):
you've been saying that for episode 50.
56. We got to get it before episode 60. You got to make that change.
We'll make it happen. So we'll be back with the Jurassic podcast.
Is that what you're going to call it? You got to figure out exactly what you're
going to call it. Yeah, it's going to be a problem. We'll be back with something.
We will add a button on your board that does a dinosaur roar if nothing else.
(20:29):
Oh, that's... We can get that done. Great idea. Boy, man.
Thanks for listening to the Profit 911 Podcast. Be sure to subscribe and leave your comments.
For more information on how Profit 911 Consulting can help grow your service
business, visit Profit911.biz.
Marketing, entrepreneurship, and all things small business.
You're listening to The Profit 911 Podcast. Now, here's your host, Justin Miller.
Episode 55. Wow. This is the what if episode, Kevin. What if?
Disaster planning for your business. Oh my gosh.
(00:25):
What if? This is what keeps me up at night, and I don't think we've ever talked
about it. But it's all like the conditional, how will I survive, yada, yada, yada.
And some of it is like easy to figure out and some of it not so much.
So my question to you, before I lead you to what I've already fixed. Sure. Okay.
(00:47):
Is like, if you were taking down the company, what would you try and interfere with? Ooh.
Not as like a direct competitor. Think eviler than that.
Sure. it would probably have to do with your staff i
mean poaching them or poisoning their
mind no i mean poison i don't
mean poison like kill them literally kill them no i mean like like get them
(01:10):
to think differently about your culture or about working for you or okay you
know so this that's like the hardest one to cure we can start there yeah so
there's more there's several you've got you've got yeah we actually we've had
this exercise before called take down the company or whatever.
I can't remember what we called it. Something dinosaur themed,
of course, but. Naturally.
You know, as everyone like, you know, come up with three way,
(01:33):
like break into groups, come up with three ways, like if you are trying to kill
the business, what you would do.
Wow. Yeah. I don't think we've ever talked about this. And I continually think
through that all the time.
Like, okay, like, because as you like start to get a little bit of success,
you don't want that shit taken away from you.
Well, no, that's true. How we keep this thing going. Yeah. No.
So staff is, of course, like a major one and the hardest one.
(01:56):
So currently we're like a staff of nine or 10 here and a staff of nine or 10
is better than a staff of two, three, or four.
Just because if you lose one of them, like you didn't lose a third of your workforce. Yeah.
That being said, at the scale we're at nine or 10 is still a significant problem.
So actually behind the scenes, like we're trying to get to about double that.
(02:21):
Okay. And when we get to double that, then each Each position should be a little
redundant, not meaning like there's extra excess time. Yeah.
But at least multiple people know how to do every job. Okay.
So we're actually in the process of documenting out standard procedures a little
better, like all this boring shit.
We do have a staff member that's amazing at it and she's really helping out. So shout out to Gabby.
(02:42):
There you go. But we're documenting all the jobs and trying to make it survivable for any absence.
You know, it's the old gets hit by a bus thing. Sure.
So we're planning for each of those jobs. What happens if that person's gone?
Yeah, some of them damn near would wipe us out at this point still.
Is that because you have the right people and they're just rock stars or is
it because you don't have the backup? They're invaluable.
(03:05):
Yeah. They're here because they are awesome and they're doing a great job.
But, you know, if you take one of my salespeople right now, that's half the
sales team. Sure. That's a significant problem.
So we'll be growing the sales team to where if you take out one of them,
you took out a quarter of my sales team. One of them is a spy and they.
Yeah. I mean, it's shit like that happens too, right? You're right.
(03:25):
Or, you know, health happens. You know, there's all kinds of stuff.
But it is the proverbial hit by a bus, but it could be sabotage.
It could be just move. Maybe they move to a different location. Sure, yeah.
You know, there's things that are innocent that happen that staff members lose.
I mean, it's naive to think they'll be here forever.
Yeah. So, yes, we're currently actually pushing growth, not just for growth's
(03:47):
sake, but for stability's sake for any individual departure,
doubling up on jobs. We have one graphic designer here right now.
Yeah. Yeah, but you also know where if like tomorrow she got hit by a bus,
you have other may not on staff, but you would know where to go get that done.
Okay. So that's the disaster plan, right? We know we could use a third-party
design service. It wouldn't be quite as good.
(04:07):
There'd be a lot more explanation and babysitting and consuming a lot more resources.
But yes, if that person is gone, what does it impact?
Where does it go? Where do we go next? And she's documented a lot of the processes.
So if we want to hire it in-house again, are we starting in a better spot than
when we started originally?
Okay. So yeah, staff, it's the number one. You hit it right out the gate.
It's the hardest to plan for.
(04:29):
I don't think you can ever be fully prepared. This maternity leave that probably
by the time this episode plays is in place.
Sure. You know, has caused a desperate scramble to write down and procedurize
a very detailed job here.
Yeah. One of the most detailed, one of the most structured as well.
So good for documentation.
Okay. But also it means there's a a lot of documentation you know
(04:52):
and there's some positions that are overhead type
position well i mean to an extent i am but our
business office manager bookkeeping type
positions you know there's there's not enough work for that to be 80 hours a
week of work to have two until we're at a little larger scale so we're growing
towards that so what else besides hr which is again you hit the major one and
(05:15):
it is the thing that keeps me up at night more than anything else is if we lose
so and so you know by the way if i think if i lose you and like i don't see
an immediate impact like you probably should be fired oh yeah that's true i
can't think of any of those right now so we're we're good that's good yeah see
that's the first thing i would have gone to i i mean.
(05:35):
I, man, I don't know what would, I mean, short of some kind of catastrophic
industry thing that causes all your clients to no longer be in business.
Let's take a, there's two different things there. So catastrophic industry things
occurred during COVID. Remember all the supply chain issues? Yes.
It actually became almost impossible to get envelopes.
(05:57):
I remember that. I used to think you were, when you first talked about it,
I'm like, you're kidding, right? Right? No, nope. I'm not.
It was like getting gold from Fort Knox and you can only get so much.
Yeah. They were allocated.
It wasn't a case of they wanted to sell you stuff. It was a case of how little
can we sell you and keep you as a long-term client?
Photo booth paper was like that for a couple of years. I was like,
what do you mean I can only buy a box? I've got 17 gigs coming up. I can sell you a box.
(06:21):
So that means supply planning. How much do we keep in reserves?
Okay. And it's not as much as it was during that period of time.
You're not hoarding it now. No, which now if like something like that ever happens
again, like the next day, everyone's going to be mass ordering.
It'll be a problem. But sure. Okay.
But yeah, certainly we're looking at inventory levels.
Closely related then is machinery. So breakdown.
(06:44):
Yeah. Breakdown, repair, upkeep on the inability to find a replacement because
you have pretty specialized machines.
It isn't like I'm gonna go buy an HP printer at Walmart.
Yeah, no, there's and there's very few people to even service them.
So it's redundancy in machinery.
We have backups for every critical piece of gear. We have multiples.
(07:06):
Now, currently, we're not operating with an offsite backup as well.
Now, certain players within the industry actually are multiple location due
to natural disaster. Yeah.
So we are still susceptible to that risk. Like a tornado blows down.
I would have never thought about that.
Do you have the capability or, I mean, obviously your costs would go up,
(07:27):
but say a tornado blows through here and your whole building's done,
but you still have all your servers and stuff. Could you outsource?
Could you get all your work done somewhere else and you would just pay more
because they're doing the work for you? Or would you be... There would be trade-offs for sure.
So we've built kind of a specialized thing here that the way we do things doesn't quite
fit most shops so we would
(07:48):
be we'd be down for a while there'd be stuff not going out if everything
got wiped out now if it's a machinery breakdown you
know we've we've accounted for we have a bunch of presses we
have like every machine like every time i come in here there's a new machine
and you have to explain i mean they all look so foreign to me because i don't
know what they are and then you explain i'm like oh yeah that makes sense yeah
yeah so yeah we just built our second shop within the same physical facility
(08:11):
that is a completely redundant shop like you could You can put separate staff
down there and they can produce the same thing. Okay.
What else before I give them? Oh, you said clients disappearing, didn't you?
Yeah. Like what if, I mean, I'm not saying that suddenly the government's going to outlaw accounting.
But I mean, it's like, what if there's a whole industry that no longer is as
valid or sees all this attrition where suddenly your biggest generator of leads or clients go away?
(08:38):
So to us, that's the whales.
You know, we have a couple of clients that are really big for our business and
we have a couple of referral sources that are really big.
And that certainly is scary.
You think that's great if you get a massive client, but I'm thrilled and I also
see the risk if that client leaves of what the damage would be.
(08:59):
So I have to make sure I understand the implication of that.
And we actually work, we're working really hard to diversify client types,
referral sources to where, yeah, there'll be a very real impact if we lose some
keys, but we would be able to survive.
Well, it's hard not to have those whales because they bring in so much business.
But at the same time, you're right. You have to be able to have enough other
(09:20):
business that if they go away, you're not down 60%. Yeah. And you kind of mentioned the tornado.
So we had what, the derecho blow through a couple of years back and we were
down a couple of days. So we've put it in the natural gas generator now.
So this was an easy one. Like this was, I don't know, 10 grand or something.
And I can account for this particular downside. side so if power goes out now
(09:46):
we got backups our servers can run our staff can work remotely.
That's a fairly easy one to account for it's not like fun
and exciting to purchase that particular thing but yeah i'm kind of a nerd so
actually it was but for most people like it's not at the top of their list you'll
admit it i think the electricians love me we're reconfiguring things every six
(10:07):
months yeah keep some working yeah so we have that you know you want to go very
physical in the disasters.
You know, if we have basements here in the Midwest, we got flooding issues.
We've got sump pumps and backup sump pumps and backup electricity for the sump
pumps. But you have to have it.
Water tends to damage paper. Those are very obvious things, but they're important.
(10:29):
They can wipe us out real quick.
So internet, it's necessary.
It's kind of redundant in that we have a cell backup. Can we really operate
at any capacity with that? Not really, but we're not completely off the grid.
Production does stop if power's out. We don't have enough generating capability
right now because currently we can come back up with double shifts and we can
(10:52):
get back up in pretty quick order.
But if volume increased to a point where it was justified absolutely
we would have a massive diesel generator outside and we would continue operating
pretending we're a hospital even though we're doing junk mail that's right you
know if it wipes out the post office's ability to sort the mail then it doesn't
matter if we can produce it wouldn't matter yeah yeah and no the post office
(11:13):
isn't going anywhere last quarter they lost 2.5 billion dollars and they're still there so,
it's a great model i don't know where the money comes from i don't either we
give them a lot i I don't know what they do with it. They still lose it.
Let's see. What else was on the wipeout stuff? I think we got most of them.
Personnel, for sure. Physical plant. And by the way, if we were a more standardized
(11:36):
print shop, there actually is at least one or two organizations I know of that
all they do is disaster backup recovery for physical print facilities.
So you could shift your workload over to them. And those are going to be maybe once in a lifetime.
So you know they're there. it's not like you're going to go to them,
ever unless you absolutely have to have it but then they're there so really
(11:58):
the cost at that point is not irrelevant but it's just the cost of the disaster
business yeah I mean the downtime is is detrimental yeah I mean if our building
got wiped out right we got it insured but how much downtime would there be would
we still be in business you know well yeah you can't rebuild in a week,
it's like where can I get all this specialized equipment from that like never
existed to start with and where's the cash coming from,
(12:21):
So we got that. Yeah. I would say number one on my radar though,
all the equipment stuff within the past couple of years, I keep walking through the shop. Okay.
If I took a baseball bat to that, what would they do?
And so all those have been covered pretty well. The proverbial gets hit by a bus situation.
(12:41):
We're still as susceptible as anyone to it. A survivable, but massive impact.
Even including to me. So I guess that's worth mentioning.
There is a document that says, based on the current point in time,
if I'm wiped out, here is what I think the business is worth.
Here is who to call to verify that. Here are potential buyers for it and what
(13:06):
to look out for with each of them.
And here's how you make the judgment call, whether this thing operates without
me or whether you close up shop and how you do it.
So that does exist. this time it's not not for the benefit of the employees
necessarily as much as my wife sure well and it's i mean you and i've had we
joke about this too i mean the business you sold me and what i've grown it into
(13:27):
and the other stuff is nowhere near the scale but whether i would,
tell her otherwise at some point it will always be
in katie's mind like if i died and got run over by a bus tomorrow
it wouldn't matter what the insurance was she would call you and
say what the hell do i do with all this kevin stuff all this dj stuff what do
i do with all this stuff she knows that you would at least be able to do it
(13:49):
and and be you would be like all right well i'll do a solid for you because
he was my friend or i sold him the business it's i get that and it's funny because
no one likes to think about that but then i also don't have to think.
Gosh what is going to happen with all that stuff if i'm gone it'll get taken
care of don't worry we're going to donate it kevin that's perfect just donate
it for tax write-off that's right.
(14:12):
No, but I mean, I've gone through the exercise and that's part of growing the
business further as well.
Like right now there's like a couple of options on what would happen that changes
as we hit a little bit different scale and certainly value changes as well.
And the less I'm here, the more it's worth. Makes sense actually.
And yes, I would like it to continue on, but not if it's a detriment. Yeah.
(14:35):
How else would we take this thing down? Is there anything the government could
do regulation-wise or tax-wise?
Yeah, I mean, you can't account for them. No, because that could change at any
time. You got to roll with the punches on that one, for sure.
Yeah. I mean, if the post office goes away, obviously, we're screwed with the
current model. We'd have to become a digital agency again. Yeah.
Yeah, but you're right. I mean, if the losses to this point have never closed
(14:59):
it, it's not going to happen.
Yeah. Yeah. Yeah, it's pretty much natural disasters and people poaching would be the biggest ones.
So you just keep your people happy and do what you can to ensure against the rest.
Well, and a lot of times people, I guess it's even in my, I have,
I mean, I don't think it would ever, I don't think it ever would get to the
point where you would get a call from me and I would be like,
(15:22):
look, I've got six weddings this weekend.
I know you haven't, you haven't DJed a wedding in 12 years or 20 years,
but I got two people that are in the hospital and four more working and I need you.
I mean it's a crap you better hope that i know you got something just programmed
which you just yeah i got a playlist for you the bride knows that you're coming
i've already given her a discount.
(15:43):
You know i hate to say it but that industry was way more stressful for me than this one,
and this is crazy because this one is so much bigger and so many more things
and that to me provides security to me i feel much better about that that's
interesting it's also not like immediate time urgency stuff and we talked a
little about that i was talking about the presentation I gave a while back.
The presentations to me...
(16:05):
They're not nerve-wracking. I've given them, I know my stuff,
but they kind of lock up my brain from doing other things, preparing for it.
Each one, even if it's the same thing over and over, each one has the ability
to have an unforeseen set of circumstances, good or bad.
Well, and I'm thinking about all the behind-the-scenes shit from my two decades in the event world.
What could happen? I'm preparing for all contingencies for a live event,
(16:28):
too, which is much different than here because the impact is not immediate here.
No. Even if the power goes out and the generator fails, it's not the same as
a wedding reception, the power going out to generate a failing. Yes.
Which we were planning for that shit in that company, too. That's true.
We had a generator and we had these plans.
Well, there's the guarantee of if at your wedding I'm going to have a backup
(16:51):
system or I'm going to have a backup photo booth.
I can't, I mean, maybe five times since I bought your company have I needed the backup gear.
But the one time we didn't have it i ended up
giving a hundred percent refund because one of the guys that i
inherited from you forgot to bring a backup printer to galesburg yeah
and most of the things a good portion of
(17:11):
the things we do here like i could get a do-over would it
cost me like what i might have to refund the whole thing and
i have to lose a bunch of money uh-huh but i i still can earn
back trust yes i'm not going to get a chance to do that wedding over no
absolutely not no so you know the live event world has
a different level of stress if you care and and
we we talked about recruiting and when i was in that business that's what i was
recruiting for as well was people that cared and understood like
(17:35):
the implications of of what they had the
ability to have an impact on even if they weren't being paid to do
xyz like not doing xyz would cause
a problem yes yeah it's not
always what you do it's sometimes it's what you don't do in our in that well
and when i say our you're still i mean i still grandfather you into something
you no longer do i set up the mixing board today kevin that's good i'm impressed
(17:58):
uh it was it was plugged in properly i didn't see you make too many adjustments
yeah no everything was good you still got it yeah.
I'll still have to get a brighter refund probably.
Or a discount. I'll be like, hey, he sold me the company. We did have the money
back guarantee in that business. Yep.
Now, I don't have an official money back guarantee in the current one because
(18:21):
I can't guarantee results.
Yeah. But if we screw something up within our control, still money or credit.
I think in a way that's different.
I mean, you're taking care of people.
I mean, I learned this from you. I didn't have a money-back guarantee in my previous DJ business.
I book business because of that. There are times that that is what seals the
(18:42):
deal with the client when I say, I guarantee we're going to do this, this, and this.
Well, and sometimes if you didn't spend a lot here and you were big enough pain
in the ass, then I just give your money back even if I lose money to get rid of you.
It's not an official policy. Don't everyone become a pain in the ass if your campaign doesn't work.
But what's the threshold? old no but
(19:03):
we do care and if it's if it's something that
you know we were paid to do and it's within our control then of course
we do what we can to make it right so there you go it's
called take down the company to do the exercise in your
business come come up with five or ten things that could kill the business see
what what's within your control how often do you do this is this an ongoing
thing i mean are you like thinking about this all the time i mean it's in my
(19:25):
head all the time that's that's like my so i'm not in operations right yeah
like it's It's more strategic and strategic operations is what can shut us down.
Well, that's the thing. Maybe I should think about it more. I don't think about
that that much, but maybe I should.
That's just available bandwidth, right? So I have people who are doing other
stuff so I can think about this. Yes, and that's true. And yes,
these are situations that are unlikely.
(19:46):
Well, staff leaving is likely. That happens. Sure.
But some of them are a little ways out there unlikely, but the impact is big
enough that there should be a plan of sorts.
So there we go. If the internet completely goes down around the whole world, we're in trouble.
But beyond that, we're good. We'll be back next time with...
Hey, maybe we can get the Jurassic branding done for this. Yeah,
(20:07):
you've been saying that for episode 50.
56. We got to get it before episode 60. You got to make that change.
We'll make it happen. So we'll be back with the Jurassic podcast.
Is that what you're going to call it? You got to figure out exactly what you're
going to call it. Yeah, it's going to be a problem. We'll be back with something.
We will add a button on your board that does a dinosaur roar if nothing else.
(20:29):
Oh, that's... We can get that done. Great idea. Boy, man.
Thanks for listening to the Profit 911 Podcast. Be sure to subscribe and leave your comments.
For more information on how Profit 911 Consulting can help grow your service
business, visit Profit911.biz.
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