I Ain’t Going Down

[Music] hello everyone welcome to the 21 hats podcast I'm Lauren Feldman your host today we're going to talk about how the businesses owned and run by our 21 hats regulars are holding up during the Corona virus pandemic what impact has it already had on their businesses what contingencies are they contemplating as you know things have moved quickly in recent days as America basically shuts down we taped this episode at noon eastern time on Friday March 13 as we were still digesting the news that Pro Sports were suspending their Seasons that Broadway was shutting down that Italy was on lockdown with only groceries Andes staying open by the time we published the podcast early on Tuesday March 17 much more is likely to have happened our goal with this episode is to show how our group of entrepreneurs is grappling with the twin crises we are all confronting the medical crisis that is here now and the economic crisis that looms before us these business owners do not have all the answers and they certainly are not medical professionals in this conversation you will hear some tension you'll hear them thinking out loud figuring things out on the fly as they think about what they need to do to protect their employees their customers and their businesses you will hear them Ponder questions like what do you do if an employee test positive if we're shut down can we afford to keep paying our hourly workers what can we do right now to conserve cash this week's 21 hats podcast lineup includes Karen Clark Cole who is CEO of blink a user experience research and design firm based in Seattle Jay gz who has several businesses in Chicago including a picture frame shop artist frame service and a home furnishing store Jason home and Dana White who is founder of paral Boyd a chain of hair salons based in Detroit you can find a transcript to the conversation at 21h hats.com all right let's uh let's get started let's go around the room get a quick update from each of you uh I want to know where things stand with each of your businesses what's happening what are you thinking about uh Karen why don't we start with you you're kind of at one of the epicenters in Seattle uh what's what's happening at blink I should point out we are taping this on Friday March 13th at noon things are happening really quickly much will happen between now and Tuesday when we publish this uh so I just want people to know we're we're talking on Friday so on uh Wednesday we closed our Seattle office and on Thursday day we close the rest of them so Austin Boston um San Diego San Francisco uh what that means for us though is it's less of an impact than it is for other companies because we as consultants we often work remotely anyway because our clients are around the country in a lot of cases and then our research when we're talking to our clients customers takes us around the world so in many cases we're doing that in person it's better when it's onetoone in person and we're uh observing their behaviors as well as listening but we are absolutely capable and often do remote work remote sessions remote meetings as well so we have just turned the whole company into remote everybody's working from home everybody is still working with the exception of a few positions that aren't Consultants so we have hosts and we have Studio managers those kind of people they are still working they're being paid we've got them doing other things in a more of a support role um so as a as a company we are in much better shape than many of the local companies in the area do you have business coming in our business has not slowed down so knock on wood we have had no slowdown so far in any new business it's it's incredible that's very surprising yeah I I expect it it may happen um the other the the advantage for us as well though is that a lot of our clients are set up like we are so they're they're high-tech companies they have distributed workforces and so they are also used to being remote Dana uh you have some sophisticated Tech aspects to your business but but you're a retail business people walk into your store your customers uh have to sit in a chair your employees have to touch your customers what is happening uh at paral Boyd so we here in Michigan um they just decided to close all of the schools starting Monday March 16th until April 6th um for first thing we looked at was how many of our staff are parents um and then how do we cover shifts um we're going to watch what the volume tells us because we're not appointment based we're walk-in only so the volume will tell us how to lean um and what we're seeing as of this morning since the announcement was made last night is guests are calling asking if we're still open um and we have had a few people come in into the salon what we're expecting um is we're expecting people to trickle in today um because a lot of people didn't have to go to work and again um a lot of parents kept their kids home from school so we're expecting people to trickle in again we're going to reassess our staffing needs once we see what this weekend um was was shapes out to be um and again as we said in our original uh Corona virus special on the podcast you know I was concerned that my slow season would be extended and and so far it has um I had a meeting with my manager yesterday and I noticed that business has dropped significantly um and I panicked um and so I reached out to people that I felt could you know kind of help keep me focused you know via text and telephone you panicked in what sense did you take any actions or you panicked in the sense that you just started thinking about things and asking questions I panicked early afternoon and then started thinking about things and then started to act that night so that's what we've been doing ever since last night is dealing with it so we're just going to see where it takes us um we had we're updating or not updating but we're maintaining our cleanliness standards of course the state of Michigan has cleanliness standards that we have to adhere to but we're going to go above and beyond that in our morning meetings we're talking to our staff about what they can do to keep themselves safe um but we've already with so we already had gallons of alcohol in the salon because we use it constantly anyway so we're just now adding to it bleach wipes thank goodness we ordered our supply of bleach wipes and hand sanitizer uh a little over a week ago so we just got gold solid gold I know yeah we have I think nine containers of hand sanitizers the big jumbo ones you get from Sam's Club so we're covered in that aspect and I'm just communicating to our guests that you are safe coming to per boy this is how frequently we're washing the handles of the um credit card machine of the front door the vestibule door bathroom handle so we're pretty much lysoling because we've got Lysol in our order too um every hour on the public handles but everything else we already do we already alcohol and sanitized to share after each guest we already do cleanliness in the morning and cleanliness at night according to state regulations so we're just going to reiterate and hopefully our guests will feel comfortable and we're going to ask them to stay home if they're not feeling good you know I know cabin fever I think is going to be the biggest cause of the spread of covid-19 um people are going to you know they're home with their kids for three weeks you know and they've got a you know they're going to want to come out but we're going to ask that when you do come out please come out healthy um to public spaces and don't come to per boy if you're not feeling 100% that's it Dana at at traditional salons where they do take uh reservations they have a pretty good feel of you know how much business they can expect uh from dayto day you don't take uh appointments do you have any other way of judging is there any way for you to know how much business to expect or do you just have to be there and see who comes in the door we just have to be there and see who comes in the door and the good thing about that is is that business has grown year over-year right I think the couple of months that it showed a lack was because we had just opened the um Midtown location so there was some cannibalism so normally we have a number that we expect and we Project based on several years out but we've never had um an external factors such as a pandemic affect since this is the first time that we're seeing it all we can do is is watch it and again what we do in this Salon is take the data right so if something does happen in the future we can say this is what we can expect based on what happened in 2020 Jay how about you you've got a couple of uh retail operations in Chicago what's it looking like this whole thing is is in gets into your whole life it's not just so in business things are okay so far but I certainly think it's going to affect us so we have already had meetings on how we going to cut I got 115 people how we going to cut how we going to cut hours are we going to Furlow are we going to lay people off are we if people are starving and we going to lend them money yes um so we have a a plan for that and then there's the what if some gets sick thing and like for instance I'm doing some simple stuff like I've got a factory that 40 people eat in the same cafeteria I've got another room there that's not being used at all so I said let's put some tables in that other room and the different departments will eat together that way if one person gets sick somewhere else they have absolutely no exposure to the other people at least we can have a firewall there so we're working on all that at the same time I've got some personal stuff my kid just put an offer in for an expensive house he's buying and like as the world's falling apart he start to freak out like should he be buying a house at this juncture and the real estate agents are all freaking out everybody's freaking out and then the mortgage rates jumped a point and he happened to lock in but in in one day mortgage rates jumped a point because they're so overwhelmed with with demand that that they can't keep up with it so there's just a lot of anxiety so I go to the grocery store last night it it's a 24-hour grocery store shut down they're restocking shut down go there at 6:00 in the morning mobbed 50 people online it's like Armageddon here and um it makes you think about all this and I realized this is no different than September 11th and this is going to go away and things are going to go back to normal well it is different I mean I think you're making the right comparison that that's the closest model I can think of but it but it is there are differences well one difference is um forget let's go from September 11th to to 2008 meltdown the banks were messed up the mortgages were messed up the whole the whole housing market was a big bubble there's no fundamental problem now but the virus which is serious but it will go away but the banks are in good shape the market was solid there's no reason to think that the world's coming to an end with this whole thing and I realized in talking to the real estate lawyer about this whole thing it reminded me I bought my factory building in 2008 when nobody was everybody was hiding under the table because I had to make a decision I need to get my overhead down and my account goes o this is a risky deal I said it's it's less risky than doing nothing and the fact is that was a decision that was an absolute lynchpin to me being in good shape for the rest of my career and there are people right now that are panicking there's no panicking is a bad thing in business and there's no room for it I'm not going to start making stupid decisions now because I stood in line at the grocery store for 25 minutes the fact of the matter is things are going to go back to to normal but you don't know when and I mean you know look at what's happening in Italy from the latest that I've read we're kind of on a similar curve to where they were uh they too weren't as prepared as they should have been and right now in Italy uh everything's closed except for groceries and pharmacies H have you thought about the possibility that you might have to just shut down yeah sure that's the point I was going to say Dana people's hair is growing as we sit here they're going to have to get their haircut eventually that that's a for sure thing and um people still want to frame their pict and buy furniture so like yeah but they don't need to no no you're not going to get away with you're trying to fear Monger me again I remember the last recession my somebody in financial services sent me the front page of one of the major Business magazines I don't remember which one of every recession and every time the stock market dropped the front page of the magazine was is capitalism over next one are we ever going to recover next okay okay okay so it goes on and on and on and on and the fact of the matter is we will get through this life will be fine and if you own a business you don't have the luxury of being like an employee who just has to worry about getting laid off you can't just go hiding under the table and go oh my God when's it GNA be over and I better stop buying everything and I better stop canceling everything because you could do yourself some Ser you can put yourself out of business by knee- jerking and I've been through this I've seen this Rodeo seven eight times already not this one this is different it's worse except it's going to go away the fact of the matter is you have to make smart decisions when things get tight and there's no upside to panicking and you just keep making good decisions so you so in my case I have a lot of Labor in my business so if I cut back my labor just 10% it's hundreds of thousands of dollars so we have a plan for if if business drops off we will immediately start cutting back hours and no one's going to starve and then if we got to cut back we'll do what we need to do because are you gonna are you gonna pay people while they're not working uh hourly no I I'm not Google I I can't afford to and if if I if if there was a flood here and people had to work to clean up the flood for days they would get overtime and they would get paid it goes both ways salaried people they're going to take a Furlow for the for whatever 10% but but the hourly no I I don't have that luxury I wish that I made enough money that I could go ahead and pay everybody for but I can't and at the end of the day so will you lay them off so they can get unemployment um that's one thing that people are doing here is they're actually laying them off so they can get no no well except unemployment is only half that's that's the the ratio you're way better off better than nothing no no no one's getting well for sure if I laid them off they would be eligible for unemployment but out of 115 people my guess is maybe we'll lay off two people and the rest will be cut back 10% they're way better off getting cut back 10% than either a getting laid off or B having the company go broke because what I've learned over all these years I got one job only one job it's to keep the business in business and if you forget that and you start to to not react quick enough and you keep paying people for three four months you're going to go out of business and that's not going to help anybody so I'm getting into survival mode though I don't think it's going to get that bad but if it does I'll do what I have to it's gonna get that bad I guarantee it really yep we I mean the closest thing is really a 100 years ago so none of us have seen it just all you have to do is look at the rest of the world who's ahead of us so there's no chance so you just said you guarantee it there's no chance that this will take a hit for three four five weeks it'll it'll get better it it's it's I don't I'm not to do is look at the rest of the world who's already ahead of us we have a lot of good examples like what Italy China Korea let's let's stop there let's talk about Italy what's I buy a lot from Italy what's going on in Italy they shut down some stores yes okay then what I got is that going to go on for six months people are only two people are allowed to drive in cars right now right those are some examples I know but how long is that going to go on but Jay think think about it this way think about all the money that is coming out of the economy when you shut down the NBA when you shut down Major League Baseball Broadway uh you know about the the town of new relle which is in West Chester County north of New York City they've shut everything down there people are on lockdown food is being distributed by the National Guard who knows where else that's going to be necessary even if this thing blew over in 5 weeks as we would all love to have happen the when the economy takes a hit like that when all that money comes out of it it takes a while to get back into the gear so I guess I'm asking you what's your point does that mean that because the NBA shut down my business is going to take a 30% hit for the next four years you don't know that I mean this is all this is this is what this is what goes on with the hysteria thing like I'm not saying it's not going to affect me I'm absolutely sure it will affect me but I'm not sure it's going to mean that my business is going to drop for 50% for the next two years I mean I I just there's just no way to know no no one said that I think you know my thinking would be that you you just need to be considering contingency plans which it sounds like you already are absolutely I've got my hand on the eject button if the first week that business is is down and first of all you know I'm framing pictures and a lot half deoy employees are framing pictures if there's no pictures to frame why are they here so I'll I'll I'll cut back hours but I I in 42 years I've laid off a handful of people even during 08 even during 08 I don't think I laid anyone off and I took now keep in mind I'm in the home furnishing Market housing crashed Home Furnishing everything like that I took a 30% hit which has never really recovered I've never come back from that from that hit I didn't lay anyone off off what did I do I bought a factory building that cost me a third as much as the place I was using for my warehouse and factory I readjusted the cost and now I'm in good shape because of it so that's a great Point you're you're talking about finding an opportunity in a very difficult situation do you see anything like that now Dana or Karen let me start with you do do either of you see an opportunity in this to do something that will put your business in a in a stronger position yeah so um I spoke with my Mentor yesterday um and I was literally had my hand over the send button to send an email about raising prices and he said don't you dare right now your sales are already down significantly between your salons compared to this time last year um and now is not the time for those who already aren't coming to say here's another reason not to come now especially with this virus so he said and I agree with him send out a reassuring message post a reassuring post and give them an incentive to come in like do your special let's let's continue going on with marketing when my market gets their hair done it's a necessity part of it is I want to feel good but the other is thing is hair health is very important to me you know I'm not just coming in for a haircut you wash and style my hair um and so I'm only going to go so long and you know I'm not necessarily going to do it at home I just need to know that Peril boy is a safe place for me to go so for me we're going to try um doing a little bit of marketing that I hadn't done before we're just going to keep on with that with that pace but I am I've got my hand too on the eject button because I agree with Jay my job is to keep the salon open um I know the SBA is looking to give out money to small businesses that are you know feel the sting of this and so I got an email coming to me you know explaining what that means and what I can do um but I will lay people off but I'm going to lean out my staff first if we're really if we stay on this path which with Karen I believe we will um especially with schools being closed um it's my hope that it turns around that people get cabin fever and say you know what I've got to go get my hair done um but in the event that they don't um then we will lean out and then if we have to shut down because we've seen two days and we haven't seen anybody then yeah we need to have that conversation and hopefully put my staff who are all hourly employees um in a position to where they can receive some help I'm with Jay I'm not Google Karen we just visited you in in Seattle uh where we taped a a podcast and we had a special guest Brian canas uh from his uh family-owned restaurant who uh is a great example I think of somebody who's trying to find an opportunity in in this uh crisis yeah not just an Economic Opportunity they're they are helping the community he shut down his fine dining restaurant but he's basically started three other businesses uh one of which I think is selling uh you know breakfast from uh a popup store in their lot they're doing uh a drive-thru for uh lunches and dinners and they also have started a a home delivery service uh which I think they're hoping is going to keep their uh 100 15 or so employees uh employed but also provide a a valuable service that seems to me like a you know somebody who's really thinking creatively and looking for uh an opportunity yeah it's Innovative and creative and the beauty of it is it's it's still in alignment with their mission of trying to turn people towards each other which I love because it's not just the employees but it's also the community they're trying to you know help people who may be difficult to get food I mean it's it's upscale right I mean it's not like they're at the food bank so it's sure it still is business Karen you said your your business is holding up so far but do you see opportunities here is there something that you can do yeah we're really focusing on um trying to help our clients get set up for remote work you know the user experience of working remotely so we're trying to um really talk about how we do that so well and have been doing it for quite a while now so we really do have it dialed in so we're trying to really promote that so everyone knows uh don't worry we can still do this um and help them where we can back to you Jay you you found an opportunity in 2008 2009 it certainly was an opportunity but it was also a strategic move to make sure the business was healthy I'm not even I'm not saying oh make lemonade out of lemons I'm talking about when things go bad you have to look at your business and figure out what adjustments to make and I looked at the business and I said to myself I believe we've been living off of cheap money and cheap mortgages for years I don't think this business is going to come back to where it was and I need to change my business model I was paying $10 to foot for factory space and the new space was going to cost me $2.75 that's like the entire bottom line to the company so I strategically decided I got to take the cheaper space and it wred the ship and it got me in a good place I'm not I'm not sure that this business won't shut down eventually from it but I'm also not sure it will so I'm not going to freak my employees out and go listen we might be uh closing down totally I think the worst case scenario I'm hoping is if everybody has to take one day off a week for a month they'll survive everyone will be okay um if I have to lend people money to cover their rent I'll lend people money to cover their rent but um like I said I've been through seven recessions are you concerned that people are going to just say you know I I don't even want to go outside I'm not going to leave the house to frame a picture or buy a sofa um this might sound weird but I just don't have the luxury to worry I don't have the luxury to have fear I I own a business and I need to be Fearless moving forward so I don't know that I would use the word concern do I have a contingency plan yes but if I started to be concerned about everything I would have died of a heart attack 20 years ago I I don't think you can be in business and sit there and worry about everything every day I I I just think I don't think you can do that let me ask you this um Dana was talking about change you know we've discussed the prices she charges and we've all encouraged her to raise her prices she's deciding now's not the right time to do that how do you look at uh at marketing are you going to adjust your what you spend on marketing right now do you do more or do you do less do the same well it get gets down to cash flow you know when things get tight you go from profits to worrying about cash flow so the stuff that I know is working the online stuff that I absolutely am sure is bringing in business because I can track it because when someone comes in we say where have you heard about us oh I found you online I'm going to continue spending the money on the stuff that I'm 100% confident is working cuz because the customers tell us because remember I get their name and number when they come in so I know if they've been here before I I have a I have pretty good what's called attribution I I know if they've been a repeat customer I know if they came in from driving by or from the website or from other advertising other stuff putting a full Co a full colored ad in the local magazine that I'm not sure works or not no I'm cutting that out I mean I it's it's I don't I don't know if it's working so I'm going for the sure bet so what am I doing I'm considering cutting labor if I need to I've cut back travel considerably just because some of the places we don't go to we're not going to Italy now obviously and China I send people to China to buy furniture and stuff so so we've cut back on travel dramatically I'm looking at the advertising cutting back on that and that should be enough to keep going fine and um I and like I said I'm not going to get into the mindset of oh will probably be shut down I don't think that to be true and even it's just I'm not going to participate in this hysteria I the people at the grocery store they've got cartfuls of toilet paper and you say to yourself you're not buying enough food to need that toilet paper long term like there everybody's crazy the world's gone mad for a little while I'm I'm not jumping into that stuff and I'm telling you when September 11th happened and and the Crash you're managing to sound hysterical while you're complaining about everybody else being hysterical I was think thing I was just I I got it you that's because I spent an hour in the grocery store this morning and I'm hearing about how this is going to be like Italy and I don't believe that to be true I I don't it might but just because Italy got behind the curve and got out of control there doesn't mean it's coming here so when so when so so when Karen says I guarantee it's going to happen I take exception to that it might happen no doubt I I don't believe that that's a guarantee so Jay has mentioned before um that he lives by four principles and that's what I'm hearing and it is you know this first one is it is what it is right two deal with it and this third one is three you know as business owners we are on a good and Noble mission to help customers employees and our families and then four and you know when something gets in our way I.E this Corona virus then F you right like I'm not and it's not F you we don't care it's hey I'm going to you know do your worst you're saying to whatever is in your way do your worst but my job is to make sure that my business stay stays open so that my customers and my employees have a place to come back to and if that means I have to lay people off if I have to help people pay rent that's one thing but I what I hear is Jay sticking to his four principles of business ownership I'm in the resolve we'll call it resolve I'm in my resolve mode like like it's all in Rocky too when when Rocky's getting had a terrible R had a terrible round he's sitting in the corner he looks up at Mickey and he just goes I ain't going down no more and then he won I ain't going down I'm gonna do what I need to do to fix this and I ain't going down and my employees are going to keep their jobs and we're going to forge through this and I'm not going to waste my time and energy going through the the the new cycle of oh this could be the you know what I could tell you 10 crisises that they've hyped up that never happened I'm not saying this believe me I'm not downplaying I know this is bad but 401K thing was like oh my God airplanes are going to be falling out of the sky 401K thing do you what is it no no1 yeah all right take that out edit that out airplanes fall airplanes will be falling out of the sky how about the how about the pandemic with the with the uh the that never got here what about that I'm here saying we should have a reasonable conversation about potential issues and it's almost like I hear you saying even talking about this stuff is getting hysterical and participating in in the insanity uh is that what you're saying I I heard the phrase we're going to be shut down it's happened in Italy and it's happening here and I'm enthusiastically disagreeing with that I'm saying if if you look at the data it's moving like we can see what happened in China we can see the difference between countries cities that reacted quickly and what they did with their social distancing and we can see what happened when they didn't so you can also see that the US has reacted slowly to get started so that doesn't bode well for us and social distancing means stay home it's it's bad in terms of what it means for us socially it's going to be really hard for people to do that and unless we do it it's going to hit us really hard how many cases are there in Seattle right now wait wait wait let's not go there well I'm just saying this you're in Seattle it's bad there I get it there's not a lot of cases in Chicago and everybody is doing everything they're supposed to do so I'm not sure Jay nobody knows how many cases there are in Chicago because we can't test okay I'm just suggesting there's a good possibility that my business is not going to shut down for a month or two that's all I'm saying okay and believe me I'm not at all saying this isn't serious I talked to a doctor last night at length about it it's bad and I get it but we're taking all the preventative me measures and I believe that there's a good chance that there will be a downtick in business but this is not going to be uh uh uh another economy meltdown for the next five years and I don't there's just no reason to assume that and frankly pause very importantly there's no upside to me for that there's just no upside being a business owner and deciding we might be out of business in six months and I'm certainly not going to go tell my employees brace brace yourself you might be out of a job next month let me ask a couple of questions um Dana have you thought about what you would need to do if one of your employees were to test positive yes we would look at the guest that they service that day um and then we would contact those um those guests I'm sure they would already be not coming into work if they had test positive we would also look at the employees that they worked with that day um and have them stay home um and what we decided was if one of our employees did test positive it would probably mean a shutting down that Salon wow after contacting everybody we're just not going to take the risk we're just no we would probably shut that Salon down if they what if you find out that one of your customers has tested positive same thing um it's similar but um we would again we we keep our guests in the salon for a short time um we would probably not have the people who are working that day um or with that person um come in and we'd have them stay at home and let them incubate to see um and then we look at the time that they were there um we don't know we' we've talked about contacting all the people that were in the salon with them the day that they were there but we are caught between hey do we tell them and then we're hysterical um probably we're going to air on the side of caution and contact everybody who was in the salon with them at the time but again we're seeing lower numbers so if it was a Saturday a normal Saturday we'd have to call you know maybe 10 people right now you know with our numbers being low we'd only have to call a couple of people so we would probably would call the people that were in the salon with them and the people that work with them um I don't believe we would shut down the salon because again we have these cleanliness standards that are put in place by the state and we're doing so much to keep the salon clean hourly you know the problem is airborne right so if people you shouldn't be any closer than three feet from people yeah the the reality is you can't make a decision today about what might happen in three weeks if it happens because we have no idea what's going to be going on in the rest of the city and everything else and and you can only well Jay you might be right about it might be too early for her to think about whether she would have to shut down or not but she can certainly think about what the protocol would be who has to be alerted that kind of thing I'm not saying she shouldn't be thinking about everything I'm just going you can't come to a conclusion at this point you can certainly be you should be thinking about it Karen let me ask you um if it does get bad and it sounds like you you do anticipate it will and that your business will fall off uh too uh what concerns you most I mean do do you have bank loans that you know that a lack of Revenue could uh could create a problem for or what would the big issue be for you um no it's just going to be it's going to be a reduction in Workforce so you know we have to be careful we can't have people on the bench for very long so if we have a reduction in incoming work then we have to be and we are we've already let um all of our contractors go so these are people that we use for EB and flow so if we have a higher volume than normal we'd use contractors rather than hiring employees until we know that that's a new normal and so we've already swapped um um um taking the contractors off work and put any employees who were idle because of some of these postponements um on that work and you know but meanwhile we have to keep those contractors warm because we believe that when we get back to normal it we're going to be Gang Busters because all of our clients have to make up for the work that's been postponed because they still have to get their jobs done those people to do that stuff are going to learn a valuable lesson from this which is they better have some reserves because people like Ken and I that have people that are just paid for a contract thing are they're going to they're going to lose their contracts or whatever not even a contract they're going to they're going to be out of work for a while and that's the nature of being a gig a gig worker so maybe some of those people are going to decide to get regular jobs because there's a little more stability so this is going to test out a whole lot of lifestyles of people that I mean I have a person that does marketing for me she works three days a week she works for the hotels how do you think that's working right now I don't know that anyone's getting hit worse than hotels I hope they don't go get what you call regular job because we really need them to run our business right so it's going to change then maybe you'll hire some of them but the point is she's all of her hotels are are cutting her off 100% so she's so I had a good talk with her because I mean I I have a good relation with her I said you might want to remind some of them what Karen what you just said that they should keep you warm here because they're going to want you back and like instead of cutting you off 100% maybe convince them it would be a good idea to cut you back 50% because you're going to have to go find a client to replace them so it's shaking up the whole the whole dynamics of that that stuff one of the reasons we started 21 hats was the the basic premise is that a lot of business owners feel isolated they're not sure who to talk to they don't necessarily have a spouse they can talk to it's not appropriate often to talk to employees when when things are tough this seems like the the you know W with a lot of people freaking out with a real crisis on hand this is a time when people you know want to compare notes with others and that's the whole purpose of the podcast we're having now but uh but for people who are listening to this and are looking for other ways to reassure themselves to figure out what other people are doing I'm curious what experiences the three of you have had with peer groups and whether you think uh you know belonging to a group like like vistage or YPO or EO is is helpful in a situation like this uh K Karen do you belong to to any of those peer groups I don't currently I have various ones in the past um I think they're good you've got to take a grain of salt and and to me it's all information and then what I do with it is is probably going to be different and so um you know I like to run the company sort of eating our own dog food and think about it as the user experience project in itself and that I'm continually looking internally and talking to the people who are inside the company and talking to our clients and find out more of this less of that and so uh you know it's it's important to hear other people's perspective Ives and um know what challenges they face I mean even on this call we all have very different businesses and very different perspectives on on how we run them and and how we think about them so it's for me it's interesting to see that oh wow not everyone is just like me sure so I think that's important Dana how about you have you belonged to uh one of these groups I have um I have in the past um and I've kind of created my own little um group and I've it's been okay um I don't really lean on them as much anymore um because I I just wasn't getting that much from them outside of you know a lot of I won't say a lot of talk but you know it was you you can only go so many times to you know an organization for help or questions and you know you get a couple I don't know I don't know I don't know and you go o okay so you just instead of relying on the group you just kind of bring people around you that you feel can help advise or run or bounce things off of so yeah I'm not really a part of of uh sorry entrepreneurial help groups or focused groups like that anymore would you like to be right now do you feel like it would be useful again it would it would have to be a organization that you know someone's come to me who's in a similar part of their growth that I'm in and they are you know Finding answers or being pointed in the directions to pursue their own answers that are that are helping um so yeah I I it's like being in the same grade with kids as opposed to you know hanging out with kids who are in another grade right and so you want to I'm kind of focused on keeping people around me that are where I want to be versus keeping people around me that are where I am Jay you've belonged to a lot of these groups through the years what do you think I've been in six different groups some of the big ones the nationally known on ones they cost5 $188,000 a year so I've seen about I don't know hundred and some of businesses close up you know because you go through your books together so it's been an extremely valuable learning experience of seeing the way other businesses work and in getting some perspective on it one of the biggest things and I'm dead serious when I say this you start to feel smarter because if you're by yourself and you make so many mistakes like I did you start to think oh my God everybody's smarter than me and then when you join a group you find out no not really CU there's a lot of other people that are that are making mistakes too no more than you do and here's here's a little inside which is why I'm not mentioning any names here's just this is just fact if you pay $188,000 a year for a business group thing and that's what a lot of them cost um who do you think's got the that kind of money to pay per year I will tell you in my experience and I've talk to other people this is a statistical fact many most of those people in the business group are second generation or third mostly second in the last couple of groups I was in I've only been one of out of 15 people only three of us started the business and the perspective of a second generation business owner compared to someone who started it out of the trunk of their car is very very very different so the the the the and they've got so many resources and so much infrastructure in place that that it's just different and then many of them just really shouldn't be running the business and I've seen them go broke I've seen oh my God out of a hundred I've seen 20 of them go broke so Jay what what advice would you give to a business owner feeling isolated right now and feeling the need to compare notes with others and think through their their approach do do you have any advice yes absolutely I absolutely think it's a good thing to join a business group and and and try to find one that's got some people that you can learn from try to find some some people that that are in some are in a similar situation and some of them are much older and are way past where you were at I've had some really one guy said to me this guy looked across the table at me I just joined I was about 31 years old and he was in his 50s probably and he just looked at me and he just said so have you toughened up yet that was such a poignant question because that's what it's about when you start in business you need to tough up it's not easy it's not simple sometimes you have to do things that are uncomfortable and it just shows you the wisdom of somebody of somebody who's been in it another guy said to me that is right up there he said to me he was about 50 something I was probably 30 he said Jay everybody realizes that they have limitations usually happens when you're about 50 oh my God I mean that's just brilliant like I don't have the head to make to build a $200 million company I don't I I realize I have limitations and that was just a really smart thing and when I hit 50 just like he said I realized yeah I think I figured out how far I can take this with my personality with my skill set with my risk ability and so I've gotten some really great input from people in those kinds of groups and I've also seen people do such remarkably stupid things and do it over I've been in groups with people where you'll say to the guy always the second generation I'm sorry to say you'll say you know Bob you've been complaining about your production manager since I joined this group why don't you fire yeah yeah you're right I'm you're right it's time I'm going to fire him a year later you come back to his place his production manager is still there I thought you said well yeah yeah I yeah I I just watch people do nothing I thought you just told people that they should join a business group Jay even a bad experience in a business group is better than no experience I mean it even well you know what the life cycle for me in those business groups is usually two or three years I usually get burned out after two or three years but I always leave with lots of great insights and I AB absolutely believe people should be exposed to other business owners okay so we're almost out of time we're talking again this is Friday the 13th uh as we're heading into a crisis of some considerable Dimension um I knew this was going to be a difficult conversation in some ways and I wanted to I wanted to bring something that I found uh really inspirational into the discussion I'm curious if the the three of you looked at it the same way is it a prayer no it's not a prayer we don't need prayer um good it's an item from the 21 hats morning report this week uh about a a car dealership in Charlotte North Carolina that figured out they could provide a safe place uh for people who are homeless and sleeping in their cars to park overnight and uh the thing kind of built on itself uh they wind up starting a uh a GoFundMe that uh attracted a good bit of money and allowed the uh the car dealer to actually pay uh security deposits and first month's rent for some of the people uh staying uh on the lot and it was just to me it was somebody looking at a situation not waiting for others to act figuring out uh What uh what they had to offer and and taking action that you know made a difference to a significant number of people what what do you guys think do you do you see it the same way are they doing that all the time they are now yeah oh good that's great I think that's a great story and it just shows that you know you got to keep thinking about things and and and and as business owners we have a unique opportunity to do something good for the world whether it's just whether it's providing jobs or making customers happy or using your empty parking lot to help the homeless as this guy does we have a unique opportunity to make the world a better place and that's a beautiful thing we should all I would hope that everybody appreciates that that that's a an honor and a privilege to be able to do well this conversation went in a lot of different directions I'm wondering if we can pull it together a little bit what did uh what did did each of you hear here what would you suggest somebody take away from this conversation Dana did you get anything out of it I did um you know I'm sitting here and I'm listening and I I'm concerned about the businesses that are not going to survive this and I'm wondering if Perle Boyd is one of them it's that simple that's my takeaway my takeaway is this is going to get it's going to get worse before it gets better because we're not as prepared as other Co I mean countries right and um I think we're doing all that we can um but even in doing all that we can it's going to hurt businesses when people stay home um and so who's going to survive this what great businesses are going to have to close and then you know I know some of the business owners that I talked to last night are worried as if is there something more I could have done is there could I have built my business up more two years ago because I've only been in business for six years could have done more um to make so when a travesty or a tragedy or whatever happened I would be prepared because I'm not prepared to survive this and so that's that's a fear um yeah that's what my takea away from this conversation is Dana are you are can parly boy survive um and we're going to do what we can but I'll be honest with you I don't know is there anything you're thinking about any steps you're thinking about taking that you're debating in your own mind to make sure that you do survive you know it's a matter you know do we shut down my second location right and and I don't and I don't mean temporarily right because these these these these incidents take time to recover right and there's so much that I didn't do prior to this incident um that I think I don't know if it could have prepared me for it being op optimistic um is saying that hey people are going to get cabin PE fever and as long as they have a safe place to come which is a CLE a clean place you hope and pray that they're come I know restaurants are giving out gift cards right so that when people do come back you know we can they can make money um so you know that might be an idea um but if there's no Salon or restaurant to come back to because they had to close then you know there goes the gift card so I don't know Karen how about you you taking anything away from this conversation well I honestly it's um it's I'm at a loss for words because really the it's it's Terri ter ying and for me it's less about my individual business and it's more about the overall economy and what's going to happen to you know my grandma and people who are really in high-risk uh Health profiles you know and I have like Jay's son I've got a house on the market right now and I'm like ah I need to sell that house so uh there's all kinds of little things that are happening that are they're going to pull us together as a country and a community I can tell you that and uh uh you know what we do as business owners people are looking to us our employees are looking to us to make the right decisions and I have got a lot of feedback from my employees when we close our offices ahead of the curve um thank you for taking care of me and so they are concerned about their health Beyond everything else right now and so I think we just have to be real and um and you know do be precautious in how we're running our companies in terms of of lowering costs and anything that can happen should happen how about you Jay I am not going to ring my hands and tell you that I might be out of business in six months I don't know I'm not going there I've been through this many times and I'm going to do whatever I have to do to stay in business and take care of my employees as well as possible and I'm giving a rally call to everyone who's listening we don't have the luxury of business owners to ring our hands and to to to to worry and no we're supposed to fix things and figure out the best course of action to get through this and I think what we have to do though is is preserve our businesses so that they it's on hold because when when this is all done people need our businesses to be going not only as employees but as customers so just think of it Dana as a pause and how can you can how can you keep that pause going how can you preserve it so that it can be on pause so that you're ready to roll when everything gets back because it will I think what I think and I don't know what other business owners may be listening are are in a similar situation there you know it's hard to you do the work and you you you embrace the paws but there are people that I owe money to that aren't embracing my Paws that don't care that covid-19 Brimstone fire hail I don't care I want my money okay I got it let me explain this to you what are they going to do kill your cat this is what I want to know they you owe them money Mone so what does that mean they're better off if you go broke is that How This Ends no they're going to have to work along with you until you pay them back so there's an exact there's a perfect example of they're in this with you whether they like it or not they they lent you money or whatever that was all part of the risk of taking business they're just going to have to work with you until you figure this out because it's in their best interest in your best interest so uh you know there's a good example of what are you gonna do there there better off if you stay in business everyone is better off if you stay in business you're going to get through this you're going to do what you need to do if you need to close the one the one salon so be it and you're going to come out of this whole thing because you're smart and you're ambitious and you're responsible and people like you so so you're going to get through this and make sure that you don't ever ever ever have a bad afternoon and start telling your employees what you're really thinking because you might as well set the place on fire then I mean like it's just there's no side to it all they're going to think is oh my God I just bought a new car I'm going to lose my car and who's going to help my mother and you're just going to help freak them out embrace it you're going to look back on this and say wow I got through the whole Corona thing and this will be just one of the next 20 things that come along that we have to deal with we are out of time needless to say uh we will be returning to this topic uh as long as is necessary my thanks to Karen Clark Cole Jay goz and Dana White thank you fine job as always thank you thanks for listening everybody this episode was produced by Jess tharan founder of blank word Productions remember we started the 21 hats podcast to help business owners feel a little less isolated to let them know they aren't the only ones fighting these battles if you got something out of this conversation please help us reach more people tell a friend subscribe and review us wherever you get your podcasts follow us on Twitter at 21h hats and let me know if you have a question or a comment or a topic you'd like us to cover my email address is L Feldman at21 hats.com see you next time [Music]