Episode Transcript
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Speaker 1 (00:04):
Hi, you have done to censure wow for you young.
Speaker 2 (00:19):
This is the pipe Man here on the adventures of
Pipe Man W four c Y Radio once again in
the positively pipe Man mood with our resident expert. And
I think, you know, last week, I think I kind
of screwed that one up. So I think better this
week and I did it right. But more importantly, this
(00:42):
guest that we have really does it right for your business.
So let's explore some more powerful business strategies with Michael Barbarita.
Speaker 1 (00:52):
Thank you for having me again, Deane. I appreciate it,
you know my pleasure. Yeah, you know, one of the
this one today we're gonna talk about as a financial strategy,
and business owners have a hard time grasping this one.
Now it's something I do with every single one of
my clients because it helps It helps them so much
(01:15):
in a decision making process because you see, a CFO
is forward looking, where most of the financial people like
CPAs and bookkeepers and so forth, they're historical. They're mostly
telling you what happened, where a CFO it tells you
what looks like is going to happen. And one of
(01:37):
the tools that we use, and that a strategic business
owner needs to have is a business and cash flow forecast.
And I've got some benefits and reasons why the business
and cash flow forecast is. It's just it helps why
(01:57):
it helps you make better business decisions because it helps
you identify the ramifications of your decision. It tells you
the ramifications of your decisions before you make it, and
so but all the strategic advantages that it has I'm
going to go through, but business owners don't necessarily grasp
(02:20):
it for some reason, and despite the fact that I'm
able to convince every one of my clients eventually to
have one and they thank me for it afterwards. Because
an it's an ongoing blueprint. It's an organic, ongoing, dynamic,
ongoing blueprint. So the first benefit is with a business
and casual forecast, you actually discover the most successful business
(02:42):
model you can have. The forecast reveals your business's true
potential and it shows you the most efficient way to operate.
It's like having X ray vision into your business model.
And so when you can discover the most effective business
model you can have, because it's not necessarily the business
model you have now, and when we propose strategy implementation,
(03:08):
we show you what it looks like financially through our forecasting,
that's another big advantage. Another advantage is it's a competitive
advantage through knowledge. When you know your numbers and understand
your business model, and you're knowing and you have a
good grasp of what's going to happen, you're far ahead
of your competitors who are operating on gut instinct and hope.
(03:30):
So that's another benefit. The third benefit is something that
business owners relate to the most out of all the
benefits that I offer with the with the forecast, and
that is the can I answering? The can I afforded? Question? Yeah,
that's the question I get the most. You know, can
I afford a new truck? Can I afford a new manager?
(03:51):
Can I afford a new location, a new product line?
The forecast gives you accurate answers and shows you the
risk of thenociated with any of those investments, So and
and and it has provided so much clarity for business
owners who are just unsure. It just that when they're unsure,
(04:15):
at best, they're on the fence. But when they we
can kick them over the fence one way or the
other with the with the with the tool that we
use the business and cash flow forecast. It's like a
breath of fresh air for them because they're not stressing
over these decisions. They see how it will work and
they have confidence because the forecast is essentially their their
(04:38):
view of what the future will happen. Especially on the
top line. It's also a risk assessment and opportunity discovery tools.
So the forecast tells you both. Uh, you know what
the risk are and what the opportunities are. It shows
you what investments make sense and which ones could cause
problems down the road. And it tells you when it's cloudy,
(05:02):
not when it's raining, which is very important for business
owned to really grasp and understand because we're able to
identify for our clients when it's cloudy, when things are
just start where I start to question, make I start
to develop more questions for the business owner. UH. That
(05:25):
gets them thinking about the risks uh, but also the
opportunities because it's also an opportunity UH a tool discovery,
opportunity discovery tool. Next, it's cash requirements. Okay, you'll you'll
see the needs of cash requirements well in advance, so
(05:46):
they have time to secure funding or you know, maybe
you want to self fund it. But whatever, whatever reason,
whatever way you want to go, it's telling you in
advance that you're probably going to need more money in
a couple of months, and a year, in ten months,
whatever whatever. The forecast says. Another advantage of forecast is
(06:10):
it's a resource planning for growth or control or contraction.
You know, at what sales level do you need more people,
what sales level do you need more equipment? You know,
the forecast tells you exactly when to make these critical decisions.
So it's it's really and I've only gone through half
of the benefits, but it's really just those benefits alone
(06:33):
makes it worthwhile to have your CFO prepare these these forecasts.
There is it. There isn't a Fortune five hundred company
in the world that doesn't do a forecast, even I
should say Fortune ten thousand.
Speaker 2 (06:48):
I don't know how you could run any business without
a forecast.
Speaker 1 (06:52):
Yeah, I mean, you've got to know where you're headed.
It's just and you've got to you've got to understand
the risk and opportunities. You got to understand if you're
going to need more people or more equipment, and that
The other advantage of the forecast is multiple what if scenarios,
so you could even right in front of your eyes,
(07:13):
you could say, Okay, this is what it looks like
if sales drop twenty percent, or what if you lose
your if you lost your biggest customer, what does that
look like? Or on the other hand, what if you
get that large contract. What does that look like? You know,
it's not all negative, it's also positive. There are what
if scenarios for everything. Yeah, and so it helps you
(07:34):
plan for multiple what if scenarios so that you are
prepared for anything. And then it optimizes staffing decisions. So
if you ever wonder if you have too many people
or too few people, the forecast shows the optimal number
of people that you need and where they should fit
in the organization. That's another big advantage because staffing is
(07:57):
could be a nightmare, especially if you have over five people. Yeah,
and then it's the forecast is also the basis for
the strategic plan. It gives the company direction. It builds
your confidence because you have that direction. So it it
it helps with the strategies that we that we help
you implement because we could see what that looks like financially,
(08:22):
because a lot of I'll call them coaches. I hate
using that word. By the way, Dean, we're strategists and.
Speaker 2 (08:28):
I'm not a fan of that word at all because
the most overused word ever, and most of the people
that call themselves coaches don't even have the certification that
there are or even realize that there are certifications for
experts that are actually doing that. And also, you know,
(08:49):
one is coaching without implementation.
Speaker 1 (08:51):
Like right, that's right, I mean it has.
Speaker 2 (08:53):
To go hand in hand.
Speaker 1 (08:55):
Absolutely, And just so you know, Dean, I don't know
if I've ever said it on the show. I am
a CERTI of five profit coach, which means I have
been have gone through rigorous training because like you said,
there's many coaches out there that you know, just really
don't know how to grow a small business. And so
(09:15):
we go, we went through a real rigorous training to
prove to earn the certification that proves that we can
help implement implement strategy. That's and so that's why I
get away from the word coach. So that's why I
don't call you know, that's why I don't talk about
being a certified profit coach. That is the terminology, that
(09:38):
is the certification. But we help implement UH strategy and
that's why I call it strategic implementation, and so the yeah,
so the other thing is critical metrics. The forecast helps
you identify the critical metrics in the business, and metrics
are financial parameters that evaluate the performance and productivity of
(09:59):
a busines. And it's easier for the business owner to
understand four or five critical metrics than it is for
them to read financial statements and understand what those are
telling them, even though as a CFO my job, one
of my jobs is to give the story that the
financial statements are telling the business owner, but the critical
(10:23):
metrics helps them understand it better. So that's the other
thing that the forecast does. It helps identify those critical metrics.
And the other thing is is I mentioned earlier that
the forecast isn't something we just prepare and throw in
a drawer like most business owners do. You know, they
(10:43):
call it a budget. What we do. Our forecasting is dynamic,
which means it's always ongoing. It's a constant tool that
gets updated with actual results. And once those actual results
are updated, the forecast rolls forward and you're able to
better understand what's going on. And then finally, capacity limitations
(11:10):
understanding what your capacity limited. You know, every business has
capacity limits, and what the forecast will do is will
tell you when you reach your capacity, so you might
have to make additional investments in order to grow. Maybe not,
but at least it helps identify capacity limitations. So those
(11:34):
are the benefits of forecasting. And I got to tell
you it's it's hard to it's hard to talk about
or market business and cash flow forecasting. I'm usually able
to convince my prospects and clients once I have an
opportunity to go through those benefits, because you just can't.
(11:57):
It's just it's just too difficult to go through those
benefits or to talk about those benefits in a very
very compact way that business. Because business all hate numbers
to begin with. So if I talk about a business
a cashul forecast, it's like turning off a switch in
their brain.
Speaker 2 (12:13):
And like I said, like I've said before, they you know,
they don't want to know a lot of times, and
they think ignorance is bliss. But you know what forecasting
is bliss?
Speaker 1 (12:25):
Right, we gotta you gotta do it, you really got
to do it, and so and and so it's part
of our program. So because As you know, we're both
CFOs and strategic implementation specialists, and so we combine both
the financial with the strategy. So when we implement the strategy,
we understand the financial reorifications of that strategy. And that's
(12:49):
what makes it advantageous to work with us.
Speaker 2 (12:52):
And how do they work with you?
Speaker 1 (12:54):
But okay, well, they would go they would go to
my website, next step CFO dot net. They would be
able to download a free copy of my book called
Powerful Business Strategies. And then they would also if they
go to the contact page, which was is NEEXTSTEPCFO dot nets,
forward slash contact or just click the contact page when
you're on the website, they would be able to schedule
(13:16):
a book interview. There's nothing to buy, leave your wallets
at home. It's sixty minutes on zoom. And by the way,
the reason why we do it is we're constantly updating
our book with different versions, and it's sixty minutes on zoom.
I present a strategy from the book and then I
ask you if the strategy, if a business owner were
(13:39):
to implement that strategy, what the impact would be to
a business owner in your industry. Then I documented for
the book but I promise you this. You will learn
business and financial strategies that your competition isn't doing. And
that's why it's so valuable for a business owner to
go do a book interview.
Speaker 2 (13:57):
Oh yeah, it's key. You know, you have to be
not only aware of your competition, but you have to
do things that they're not doing, because that's what separates
you from the pack. And that's what separates you from
the pack.
Speaker 1 (14:14):
That's right, that's what we're all about. That's what we're
all about Dan doing what your competition isn't doing.
Speaker 2 (14:20):
There it is so thanks once again for wealth of
information and for giving us some powerful business strategies. And
I implore all our listeners reach out to you see
what Michael has to say. You won't be sorry because
it will help your business immensely. And thank you Michael
for once again being on the adventures of Pipeline Pipeline.
(14:44):
Thank you for listening to the Adventures of Pipemin on
w for c UI Radio.