Episode Transcript
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Speaker 1 (00:04):
Hi, you love done too, that's true.
Speaker 2 (00:09):
For why great Young.
Speaker 3 (00:19):
This is the Pipe Man here on the Adventures pipe
Man W four C Y Radio. And this is another
edition of our segment Positively pipe Man, and we have
our returning expert guests, because man, he's such an important guest.
He helps your business and like no other person on
(00:40):
the planet, and in these segments every week, he's gonna
come on as part of this Monday show for Positively
Pipe Man and give us strategies that can make our
dreams in business come true. So let's welcome back Michael Barbarita.
Speaker 2 (00:58):
How are you fantastic?
Speaker 1 (01:00):
Dan, how are you doing? Thanks for the kind words.
Speaker 3 (01:03):
Oh my pleasure, you know, because it's true, like I
don't even need a script because I listened to you
on your own show on our network, and I've talked
to you at length, and you know, I just know
you're the right answer to most of our businesses out there,
especially in the trying times that we're experiencing right now.
Speaker 1 (01:25):
That's for sure. I appreciate it. Thank you.
Speaker 3 (01:28):
So what I'd like to know is, you know, we
always talk about the eighty twenty rule, So how does
that really apply to business? According to Michael Barberita and
next Step CFO.
Speaker 1 (01:42):
Yeah, great question. By the way, you know, as we
were doing research for our book and as I interview
business owners for the book, it was very common that
from a business standpoint, people felt that the eighty twenty rule.
And by the way, no one's ever wrong about the
eighty twenty rules, so I don't want to make it
(02:03):
tell them that way. But most people think eighty twenty
and they're right that eighty percent of their revenue comes
from twenty percent of their customers, and that's absolutely correct.
But what we discovered when we were doing research for
our book is that eighty percent of the revenue comes
from twenty percent of what you do every day, and
that business owners aren't focused on the key components of
(02:29):
that twenty percent that drives eighty percent of the revenue.
And what we did when we were doing research for
our book is we identified seven areas that we call
the seven step Pathway to Profit formula, and we identified
seven areas that which represents the twenty percent that drive
(02:51):
eighty percent of the revenue. And you know, most business
owners want to know what that twenty percent is, and
that's what we're going to do today, we're going to
go through that and a lot of business owners that
identity really never understood what that twenty percent was. And
so we're going to go through today the first step
(03:13):
in the seventh step pot thread of profit formula. And
by the way, I want to mention one other thing.
When we were doing research for our book, we found
that there were eight areas of impact where that business
owners had to had to know about, and then when
we dug deeper and deeper, there were more lands and
(03:34):
more lands, more lands, and we ended up at thirty
two with this and this. Under those thirty two categories,
there was another twenty or thirty categories. And so business
owners are overwhelmed. And that's what that's what kind of
led us to understanding what that twenty percent was that
drives eighty percent of the revenue. Because business owners are
just completely overwhelmed. And what they do, Dean, is they
(03:57):
hire marketing companies. And the first thing that marketing companies
do is they omit all the stuff that's needed for
a business owner to get grounded. All those areas that
I talked about, they skipped over those completely and went
right to Facebook ads or social media ads and that's
starting in the weeds. And so what we did is
(04:19):
we identified those seven steps that drive eighty percent of
the revenue. And the first one is leads, but not
just any lead, good quality leads for your ideal customer.
That that's really critical. And you know, all of all
of this first part that I'm gonna be talking about
is really just about messaging all it's really about. The
(04:42):
second is conversions. And let me define conversions. Conversions is
taking a prospect, whether it's cold or warm, into your
sales process, whatever that is, you know, for a retail
of the sales process of them showing up in the
retail store. For somebody like my sales process is a meeting,
(05:02):
So it could be a meeting, it could be proposal,
it could be an estimate, whatever your sales process is.
So the first step is quality leads. The second step
is conversions.
Speaker 3 (05:14):
I want to talk about those leads for a second too,
because as somebody that's been a salesperson since I'm like
eleven years old, okay, I've gone through every kind of
lead there is, and here's what I found that just
proves the point of what you're saying is Okay, So
when I was in the investment business. When I started
(05:35):
in the investment business, the people, the leads they were
giving us were basically as cold as cold could get.
They you know, it's just basically buy a book of
names and phone numbers and that was your leads. Right
then later in the business, I would do exactly what
(05:57):
we're doing now, and I would have a radio show
to get leads for my investment business. And you know,
there was such a huge difference because when I was
first in the business, you had to make like five
hundred calls a day.
Speaker 2 (06:12):
This was the numbers.
Speaker 3 (06:13):
Five hundred calls a day to get twenty people to
actually talk to you and have that twenty five to
seven maybe want some information, and you would mail them
out information, you know, back in.
Speaker 2 (06:26):
The snail days, and.
Speaker 3 (06:29):
Then out of that one of ten would actually become
your client. So you'd have to make five hundred dials
to get a client, which is a lot, okay, and
it's a lot of work, and it's time consuming, it's
not fun, you know. But then I could get on
like a radio show like this as one example. I
(06:53):
don't mean somebody else's by me. I had my own
radio show. And then and then you know that was
a different time too, when like infomercial type of stuff worked,
you know, really well. And then I would get these
leads that ninety percent of them would send me money,
you know. And so yeah, you would think because I
(07:15):
only had a handful of leads, it's like, oh, I'm
not going to get any business. But that handful of
leads got me way more business than the five hundred
dials that you know to get one lead, you know.
So I wanted to stress that point because your strategies
for people are so that they can gain more you know,
(07:38):
revenue with less effort and time.
Speaker 1 (07:43):
That's correct, That's right. And the messaging is the key.
You know, your messaging and a code call is completely
different than the messaging that you have in your show.
Speaker 2 (07:51):
Yeah, totally right.
Speaker 1 (07:54):
So, uh, and that's something business owners need to understand more.
It's not next to the set. It isn't. It isn't Facebook
versus Instagram, versus LinkedIn versus. It's not that. It's the message. Yeah,
if you get the message right now. Granted you could
go to the wrong platform in terms of demographics, I
(08:14):
get that, But the bottom line is, you know, lots
of times when business owners talk shop. Have you tried Facebook?
Has it worked for you? You know that it's totally irrelevant.
It's about the messaging, whatever, the messaging that that particular
business had.
Speaker 3 (08:31):
I think that's so true too, by the way, because listen,
you could still say to anybody an our age group,
you know, something like PLoP PLoP, fizz fizz, and they
will automatically think of alka seltzer. Okay, you can say,
how do you spell relief? And I don't even think
(08:51):
you can buy roll ads nowadays, but you still remember
the message.
Speaker 1 (08:56):
That's right, absolutely, no question. And that's the case. That
is absolutely the key. So in continuing on with the
seven steps. So the first step is leads, as I said,
the high quality leads, second is conversions. The third step
is closing rate. And by the way, a business owner
needs to track their data. They need to track the
(09:18):
information because that's how they learn where they need to tweak.
You know, if if you have a closing rate of
one percent, if you if you if you could get
quality leads and you could convert them into your sales process,
but your sales process yields a closing rate of one percent,
you know where you have to work. You know, you
have to what you have to work on, but you
(09:40):
have to know that data. Otherwise you're going to be
flying blind and you're really not going to tweak in
the right areas.
Speaker 2 (09:47):
And ignorance is not bliss in this instance.
Speaker 1 (09:52):
Very true. And so you have high quality leads, you're
converting more of them into your sales process and and
then you're increasing your closing rates. Now, the fourth step
is retaining clients. You know, this is where a lot
of businesses fall down. They they don't focus at all
on client retention. And here we are, we're putting it
(10:14):
in there as one of the you know that part
of that twenty percent that business owners need to focus
on that drive eighty percent of your revenue because you
need to retain clients. Yes, uh, it's it's a critical
component and and you have and yeah, and it's and
you and it takes some work. It's not one of
these you don't a lot of business owners think that
once they have a customer, they get to keep them
(10:36):
by default.
Speaker 2 (10:37):
No, no, no, no, no, does it happen? No?
Speaker 3 (10:42):
And nowadays they think it even more like we think
because we live in this world of AI and everything's
automated that you know. No, no, no, that's why you know.
I run this network, you know, on a new technology
but old school philosophy.
Speaker 2 (10:59):
Customer, you have to.
Speaker 3 (11:02):
Be on the same team with your customer so that
you can get them the success they need, So you
can get the success you need.
Speaker 1 (11:11):
Excellent, yeah, oh absolutely, it's so true. And then so
you have qual high quality leads, you're converting them more
into your sales process, you're closing them at a higher rate,
You're retaining those customers. Now you have to focus on
the average dollar per sale. So there are strategies associated
with increasing the average dollar per sale for your existing
(11:36):
customers and now obviously also any new customers as well.
But once a customer comes into your ecosystem, you're able
to increase that average value. It's just part of that
seven step formula that's going to drive eighty percent of
the revenue. And then the sixth step is frequency of sale.
(11:57):
So now if you have five hundred customer and you're
selling them to them two point three times a year,
you want to look to sell to them three times
a year. Maybe you have to add more value to
your products or services. Maybe you have to add more
products or services but you want to increase the number
of times that you sell to them.
Speaker 3 (12:16):
I love that concept right there, because that's something I
live by as well. I think you have to constantly
innovate and evolve your business so that you can do that.
You know, there's always there's always something else that could
add value and benefits that would be something that your
customer would want to take advantage of.
Speaker 1 (12:39):
I agree one hundred percent. Yeah, I've seen many times where,
you know, business owners fail to fail to rejuvenate even
former customers, they fail to rejuvenate them. All of your
customers are what we call buyer's journey, and yeah, that
(13:03):
journey could take anywhere from fifteen minutes to fifteen years,
but they're on that journey. And you have to constantly,
constantly nurture your customers and your existing base to tell
to them more frequently.
Speaker 3 (13:17):
And you know, I tell people throughout my whole career
that have worked for me. You know, basically, you do
have to continue to nurture those people because if you're
not and you think, okay, I got them in the bag.
You know, even in the investment business, everybody says my
broker until somebody else comes along and does nurture them,
(13:37):
and then you can't save them after that because you
should have nurtured them before somebody else did.
Speaker 1 (13:45):
Right. Well, that's right because, as Mark Cuban says, there's
always somebody out there going after your butt, you know,
and trying to take you down totally right, and they'll
grab those customers just as easily. And then the final
step is UH we we work on costs, both fixed
(14:05):
costs and variable costs, and there's there's a number of
ways to cut costs. Business owners normally find it difficult
to cut costs, but there's a lot of different ways
that we use UH to to cut costs. And but
but it's still it's it's one of the most it's
one of the seven steps. So once just in review,
(14:27):
it's leads, conversions, closing rates, client retention, average dollar per sale,
frequency of sale, and finally costs.
Speaker 2 (14:39):
And I think they need to know a lot more.
Speaker 3 (14:42):
So how do people reach out to you to discuss
this more where you can expand on this more and
give them specific strategies customized for their business and their goals.
Speaker 1 (14:56):
Well, I'd love what I'd love to do, uh Dean,
is I'd love to interview them for the next edition
of my book, because there I go through strategies that
we that that we help business owners implement, not just learn,
but implement and then get a really good understanding. And
by the way, they can help me with the next
(15:16):
edition of my book, because what we do is we
interview business owners because business is always changing and we
always want to make sure that our strategies are up
to date and that they work now that they've worked
in every economic environment so far, so I don't think
that they're not going to work in any future one.
But we need more industry information to prove what we
(15:38):
already know and so and then and then we update
the book. So the way that works is it's sixty
minutes on Zoon, I present strategies from my book and
then I ask you if the impact the strategy would
have if a business owner would implement in your industry.
It's more of an industry perspective that I want to
I want to get and then documented for the book.
(16:01):
And that's it. And I would love to interview business owners.
They could go to next STEPCFO dot net. That's next
step CFO dot net, Forward slash contact that would get
them into my contact page, and then they simply fill
out the contact form and in the message section write
the words book, interview and I'll said Jack calendar.
Speaker 2 (16:25):
Nice.
Speaker 3 (16:25):
And then also if you could tell everybody how they
could check out your book, your podcasts, your live show,
all that excellent.
Speaker 1 (16:35):
Yes, but you can get a copy of the book.
It's free, by the way, it's my contribution to the
business world. Go to next STEPCFO dot net. Right on
the home page you could download the book. That's number one,
number two. As Dean said, you could visit our podcasts
at Powerful Business Strategies dot com and our radio show
(16:56):
called Powerful Business Strategies on Mondays at noon Eastern.
Speaker 2 (17:00):
Time right here on w yeah, right here.
Speaker 3 (17:06):
In fact, if you have a time travel machine, after
you hear this episode, go back an hour and time
before an hour before the episode and you'll be able
to catch a show. Otherwise, wait till next Monday. All right, Well,
thanks a lot, Michael Uh. Once again, you have some amazing,
like very specific strategies for people, which is why I
(17:28):
love because there's so many coaches out there that just
give such generic advice. And you know, every business is different,
and that's why even the you know, the interview, like
it's great that you're finding out what what is most
beneficial in different industries because it's not a one size
(17:48):
fits all. But Michael Barbarita, you probably are one size
fits all. So thank you, thank you for being on
the adventures of fight Man.
Speaker 1 (18:00):
Thank you for listening to the Adventures of Pipemin on
w for c u I Radio.