The Year So Far? It’s Difficult Out There

[Music] hello everyone welcome to the 21 hats podcast I'm your host Lauren Feldman this week we get updates from Laura Xander Sarah seagull and Jay gz Laura wonders whether the time she's put into integrating her latest acquisition might have been better spent focusing on her core businesses Sarah who has shifted to pursuing smaller clients asks Laura and Jay to articulate the pr pitch that would interest them but how do you evaluate the effectiveness of a PR campaign does it have to generate Sales Plus Jay explains why he views confronting his current business challenges as a matter of triage he also says that if he could write a check for $200,000 and solve his technology problems he would do it in a heartbeat any takers out there even in Good Times owning and running a business can be a lonely Pursuit our hope is that these weekly conversations brought to you by a principal sponsor the great game of business business will let owners know they are not alone in facing challenges same thing with our daily newsletter the 21 hats Morning Report which Inc magazine named the best newsletter for business owners and which you can subscribe to for free at 21h hats.com where you can also find transcripts of our podcast episodes and lots of other articles and interviews joining me this week on the podcast are regulars Jay gos CEO of the gos group whose companies in Chicago include a picture frame business artist frame service and a home furnishing store Jason home Sarah seagull CEO of seagull Communications a public relations firm based in San Francisco and Laura Xander who is CEO of Jimmy beans wo a digital yarn store based in Reno Nevada and Maline TSH a yarn manufacturer and distributor based in Fort Worth Texas the episode is titled the year so far it's difficult out there welcome Jay Sarah and Laura it's great to have you here it seems like every day we're confronted by conflicting messages about how the econom is doing how businesses are doing and as I did with a different group here a couple of weeks ago I'd like to start by just checking in with you guys we haven't spoken to you in a while Laura uh what's going on with you have you bought any more businesses lately no I'm on a diet um things are good um we you know we bought those two businesses integrated them it was rough and we hit the Tipping Point um about a month ago 3 weeks ago or so so I actually haven't traveled in about three weeks we're starting to what's the Tipping Point what do you mean by that um I mean that we're through the worst part we're at the top of the hill um so all the pain and suffering not all but the majority of the pain and the suffering from the integration is behind us so we're starting to gain traction we're starting to get more orders again we're able to process them we've got fewer errors um it's things have stabilized so we're on the upswing you know we're at kind of the bottom of the hockey stick I I think of growth um but now with that comes the exhaustion so you know the adrenaline's worn off and so we're just Jay calls it battle fatigue so the battle fatigue has just set in um so I'm trying to figure out kind of how to handle that do you take a week off do you take two weeks off you know I did take a little bit of time off um but trying to and I'm spread a little thin um so just trying to reenter now that the fires are out uh and get back into kind of a regular you know an everyday Cadence and figure out what that looks like for the next year or two before we do something else to create another battle when you say you know all the hard stuffs over so the bottom line I'd like to know is so you integrated these companies what does that mean how did you fire some people that were working at the other companies that just didn't fit that were I mean that's usually what what was the pain give us the pain um the pain was we moved locations so one of the companies that we brought on was in Arizona and we moved production to Texas they didn't have anybody that wanted to come to Texas so we had to train our staff there was some pain in that originally the deal was the owners would operate the business in Arizona for two to three months as we were training and as we were able to catch up and learn and we were going to do a transition and and one of the owners just couldn't do it um so we ended up having to transition there was almost zero transition about one week's worth of transition so we were really like thrown into the fire um very quickly and um you know our staff yes we hired some people we fired some people um it's taken us you know five months to find the right team to be able to do the things that um we need done to to dye the yarn in the way that needs to be dyed you know the the former owners one of them was has has all the skills she was really the die master so she had all the technical skills and was the Craftsman and knew how to do everything but she lived in Arizona so we brought her to Texas a couple of times you know she would train um and you know it just gets messy communication gets messy it was just messy when you buy a company the higher-ups are looking for their their golden parachute they're going to walk away with a bunch of cash or or whatever the deal is right how realistic is it to expect that they'll be um in in it 100% during the transition I can't speak to Tech um or you know office jobs or uh whatever but in in our experience and we're working with small businesses most of the businesses that we've acquired have 10 employees five employees um so it's a much different world uh I it's 50/50 in this case there were two Founders um two owners one of them is still completely uh dedicated to doing whatever it takes to making sure that things um move forward and are successful and the other one tapped out after about a week so it just it depends so how many employees were there in Arizona that are now have been laid off how many people were there um maybe eight so my question is that goes on their unemployment did you take over the corporate entity or is that un so that's good so that the unemployment is going to come out of The Old Company not from your company correct yes and that's because you just bought the assets not the whole we just bought the assets yeah we always just do an asset that way anybody goes to sue you down the road also if correct yeah I think that's a critical distinction buying the assets versus buying the company 100% so buying the asset you're you're just you're buying the the technique and the product and the inventory and the the URL um the whatever the product F the trademarks any patents the intellectual property how do you negotiate like a a deal like that like how do you how do you put a value a dollar value on it me personally CU I probably do it a little differently than other people do um I mean I take a look at it's just their p&l and their balance sheet so I take a look at their p&l I see on average over the last two to three maybe five years um depending on if they're big bumps or not uh what their profitability is and then I figure out I try to offer something it's usually about two to three times what their profitability is because then I assume it'll take us two to three years to pay it off and then I add inventory on top of that well that's interesting because the normal number in small businesses and I just happen to go to a seminar last week and it was the same thing people usually get three to four times earnings but in your case you said two but then you're paying them for the inventory which probably makes up correct so it's in the same neighbor it's probably about the same yeah exactly worst surprise after you bought it if you could talk to yourself the day before you close what would you have told yourself it's a really good question that's that's I was thinking this morning I'm like oh excuse me um dag gon it like was this the right decision was it worth it I mean the distraction cost has been the biggest cost for us right so should we have been spending this time on our Core Business the upside is there are some intangible unpredictable benefits that we have gotten out of buying this particular company that I didn't see coming and so it has actually paid for itself in some really weird interesting unexpected ways in other words as an example we got a sales rep that they had that we would have never gotten would have never been on our radar and he has managed to generate $50,000 just in one week on another brand that we carry that we weren't even planning to wholesale so um and he has taught us some things that we didn't realiz we didn't know so it's almost like we got an employee in some ways that we weren't expecting that has been just Irreplaceable I mean the knowledge that I've gotten um and that will help us grow all of our businesses over the next few years um I don't know how to put a number on it I mean I'm sure I could well you said intangible it kind of is tangible in this case it's unforeseen benefits there is it is tangible you know how much business he brought in that's that's worth a lot yes and though he's um a really good product of developer there's a business development side of this that I didn't I didn't see coming so there's that and then some of the benefits that we've gotten from the founder who was the Craftsman you know the die Master some things that she taught us has saved us $50 to $100,000 you know just in the first year like we had some product that we thought was bad she was able to fix it I don't know that we would have ever been able to fix it we would have either thrown it away or blah blah blah and then you know we're not creating more bad product because of the techniques that she's taught us so there's some little stuff like that and then you know again more IP stuff the mill that she works with or that she worked with that now we're working with that's opening up this whole other potential line of business um that we probably won't see the benefits of for two to three years but I can see already that there are going to be benefits there so the sales side of things you know are not what we thought they would be and of and I always I never expect them to be what we think they're going to be you know you can say yeah I think we're going to do a million dollars because that's what they did you know whatever pick a number but you're just guessing you know you don't know how many customers you're going to lose you don't know like how long it's going to take to pick up the techniques and you know we've never done this before so the sales aren't where we had forecasted that they would be but they're not horrible either I would think you Channel conflict and that somebody says I'm not buying she's my competitor 100% yep absolutely but we've had that I mean we've had that for years I mean so we still have that at the same time the flip side of that is she knows how to do this and she understands um what it's like to be a local yarn shop owner and she's been able to do it with these other brands so I trust her um and by buying this business and forming a distribution group what we didn't realize really was going to happen was that people start like sales reps all kinds of people have been flocking to us like it's almost like they see us as the future so I I don't know I think we're positioning ourselves in our industry as a player in the wholesale Market which we hadn't really been before so it's it's just very interesting I mean we're we're evolving so this was a big huge part of evolution just to be clear the channel conflict that you're referring to is that you have a company Jimmy beans wool that sells to yarn enthusiasts over the internet but you also sell wholesale to yarn shops around the country that theoretically could be selling to the same customer correct correct yes you know I'm a retailer from birth so I never was used to this and you just brought up something that I've had the whole dynamic of sales reps is an important part of the business and like it's a retailer I never had any sales reps so what I've learned is we started out my wholesale business Bella you know it's been 20 years already and we were just selling cool interesting stuff that you couldn't get anywhere and I never really appreciated the Dynamics of the rep thing and what I've learned is lately our line starting to become a major line for our reps where in the beginning it was the nice cool interesting line now all of a sudden because the shift in the industry and we've got better suppliers than a lot of people we're becoming important and I look at the checks that I write every month to the Reps they used to be you know two grand a month you know was paying their gas money or their hotel bills now all of a sudden I'm writing some $5,000 checks to the Reps and it's it's exactly what you're talking about the rep thing is an important part of the Dynamics of being in the wholesale business and you also came from the same end I did you were selling retail it's a whole new game when you're dealing wholesale it's about the Reps yep yeah that's really interesting um and that's part of the I don't know I guess you know the maybe the light bulb is that you know it's a small industry so there are like some really good reps there's a handful of a-listers um and they're coming to us you know we've asked them for years if they would rep for us and they've said no and now they're saying yes to me we have the best reps in the industry now because gotten big enough that we can be half their business Now versus just a sideline Laura you said before that you've kind of questioned yourself whether all the time and energy that went into this acquisition might have been better uh spent on your core business how are your businesses doing overall are you meeting Revenue expectations um no I'm not meeting the forecast but I'm exceeding what we've done in previous years so you know how do you feel about that uh I mean part of me I mean it's how I always feel you know I mean I want to go faster but at the same time I have to recognize and be proud of what we've done and recognize that we are doing more than we were and the traction that I talked about I mean the first 3 months we just there was a lot of distraction there was a lot of learning you know there was we weren't producing as much and I mean it just is what it is so if I actually take the first three months of the year out then I think we are meeting our goals we're getting very very very close um I'm always I mean I'm just a jerk you know I'm always going to want us to hit the forecast and I'm always going to want us to hit that Top Line and so I'm you know I'm I'm always going to be a little disappointed but you know I'm trying to practice being really positive and recognizing the wins and there are some unexpected wins you know as I mentioned there are some things that I didn't see coming that you know have surpassed my expectations and today's probably a hard day to ask because I am coming off of you know four months of just pushing pushing pushing pushing you know and frustration after frustration after frustration and I'm impatient and so I'm a little tired but looking back I mean I'm really proud of what we did and the fact that objectively the fact that we made it through you know and it only really took us 3 to four months is pretty freaking phenomenal you know it's it's pretty awesome and we just had our big wholesale trade show a couple weeks ago and we doubled what we did last year so we're getting traction and I can't wait for like 2 months down the road when we're just flying you know we're just totally flying Sarah how are you doing that's a good question um I had a little reset last year when we lost a couple big clients and so I went into this year saying you know what when you have too many big clients and one or two of them depart for various reasons it completely collapses your business as an agency owner and your faced with having to lay people off and all of that kind of good stuff so I went into this year with the hey um I'm going to um instead build a business based on small to midsize clients and I'm doing that it does have its challenges though because we are uh we are close to having 15 clients by the end of next month and uh that's a lot of accounts to manage and I need to hire more junior level people to make sure that I need to build my kind of you know internal hierarchy um so not nobody is dealing with more than kind of the The Sweet Spot for most people is managing six to eight accounts right and so if you have anything more than that then they're just not focused enough on each client so it's just making sure that I have enough staff to kind of grow in this fashion although I have to say that having a nice meaty client would be really nice so it's good um I'm paying my bills um we have our lovely little office in San Francisco and I'm actually negotiating with the landlord to take over the the upstairs office as well because we're we're having couple interns starting this summer um I'm anticipating some additional growth grow before the end of the year and you know it's it's slow and steady kind of wins the race I'm cautiously optimistic let's put it that way in the past we've talked a little bit about your efforts to Market your agency to go find clients have you done anything different now that you're looking for a differ Siz client so what am I doing I was telling somebody the other day I was like I need to get back out there and go to conferences I was listening to last week's podcast about going to trade shows and stuff and Walking the Floor which I understand is is not not necessarily the best use of your time but just getting out there and and being part of the community um there's a you know Jackie and her book um that they D they wrote like how that's worked as a marketing tool um I'm just kind of trying to think of the ways that I can introduce myself um in a meaningful way that's not salesy because I don't think that that works it's more giving myself out as like a a resource and then eventually that relationships develops into something else there are New Biz people for PR um there are reps they're hard to find though because they're usually more senior people so they they work for the larger companies that go out and find new business I would love if there was somebody out there that did it for smaller businesses like myself but as of yet I have not found found that um magical creature to to pitch us to to prospects you know you said something very interesting you said that going to trade shows isn't necessarily a good use of your time I can't imagine what you could do that could be a better use of time trade shows have like everybody's in the same room and like in one afternoon you could get up you know 50 companies and then you said well you don't want to be too salesy I don't know why you wouldn't I just wonder whether you couldn't be a great salesperson going to a trade show and picking up some clients right there on the floor because it seems like it's shooting fish in the barrel you think I mean my my question is about trade shows it's it's not usually the the decision makers that are running the booths right oh that's not true in a smaller for the size companies you're talking about why wouldn't the owner be or the person in charge be at a national trade show I would absolutely think they're there they're not just a bunch of salespeople there that's where business is done going to lunch running into somebody from I mean 100% yeah same so Jay and Laura so you're at a trade Joe say you have a booth and and this lovely lady with strawberry blonde care um and a little gray comes up to you what would be the best pitch that you could hear how would you like to be sold PR I go to trade shows all the time I go to conferences if someone walk up to me and knew about my business something me say Jay you've got an incredible story I would love to I think I could really get you some good I would absolutely be engaged them it doesn't happen because I'm gonna make a statement just from being the customer I can't think of worse salese and PR people I I because they're not out there I no one ever calls no one ever sends anything no one ever sends a letter I would in fact engage with someone and I may might hire them but they don't call on me now is it just because I'm a retailer and that's not on the radar I don't know Laura how about you what what pitch would work with you research I mean not just coming in cold and saying hey you know like cute Booth uh I could help you and not knowing anything about our business not knowing when we started not having a pitch for how you could help us so when we were just a few years into the business and I would put together um packets and I would research every single not every single but all of the booths like 10 to 15 boots I would research all about their business you know I would figure out how much we've sold of their products how much we think we could sell and then I would come up with three ideas of how I could work with this business or how they could work with us and at the time these were our vendors so I was asking for like you know maybe a custom product or maybe we could do some this was before social media but maybe we could do some co-op advertising together blah blah blah but I made it very individual and I actually like wrote a letter for each one of these booths that I would go by and I had a nice little folder you know that had some info on us and examples of stuff that we've done in the past um and then I would go to each booth and I'm like hey you know I don't want to bug you too much but I just want you to know you know blah blah blah blah blah and then here some more information about us here some ideas on how we could work together and it was personalized you know you can take them A coffee take them a chocolate bar you know just take them something that's a little out of the ordinary because most people don't do it they don't have the balls to like go up and do the research and you know most people just come in and kind of cold call and it's kind of lazy no I like that um we what we do um with prospects in general is we will ask them prior to our initial call um or during some at some point during the conversation um we'll determine who their competitors are and so we can pull together a pretty comprehensive report on what their competitors are doing in terms of the the media space and basically kind of um walk them through what their competitors are doing and where they're falling short and where we might be able to support them so that's that's a pretty standard we can also easily pull you know here's a top five reporters that you should be reaching out to if you don't even if you don't engage with us please at least talk to these reporters because they'll be interested in your business but I like the idea of a of a leave behind um it's kind of old school because you know people are so digital now nowadays but like giving somebody something memorable but it stands out we we have these great um branded Stanley everybody needs Stanley yeah yeah exactly exactly now I will say and this is probably just nitpicking words so ignore feel free to ignore me but you mentioned you know where they fall short so when I'm at a trade show um you know the majority of people that come to our booth are our customers and a good percentage of them are coming to complain and so the last thing I want to hear is something about how I could do better so even just rephrasing um and you know just being like hey you could really kill you know blah blah blah but just being M and I don't know Jay I don't know if you have the same experience I mean I know I'm just particularly sensitive to that but what I want to hear while I'm there is how great I am not how I need to improve absolutely the other thing I gotta tell you just viscerally and people do call me for other stuff the second day start going oh we do business with your competitors I say to myself screw you I really don't care yeah I don't want to hear about my competitors I I just I don't no I don't I think i' rather together here this is the interesting part we got the internet you can do research in five minutes you can find out anything you want to know go to my website I tell you all about me it's right there right so they come and go wow Jay you've got the largest frame place in the country and then you've morphed into opening a furniture store that's really an interesting Chicago story and I even read about have you been in the papers lately because I gotta tell you I think you're an incredible story for Chicago very seldom do you read about a Chicago business these days most of the retailers in Chicago they were well they're gone right I'm one of the few retailers and they I would love to I think I would absolutely be engaged and interested to talk to that person I'm already well aware of how my competitors are kicking my ass like I don't need somebody to tell me that in terms of what Laura in how are they kicking your ass in P or in performance everything yeah I mean the people who are doing better than us are doing better than us I mean they do more in sales they probably sometimes they have more PR they've got better events I mean you know that's part of just who I am and that's why I drive um so hard is to to to win um in some ways uh but yeah I mean they they do better they have better product they have a better website they've got better SEO they've got better this they've got better that I mean that's part of my job right is to figure out all the ways that the competitors all the things that they're doing better than us so that I can figure out how to be better than them so I'm hyper you know I'm just hyper aware already so it it never works really well when somebody comes in and says your competitors are beating you here and I'm like no like I know that you don't need to tell me that like help me figure out other ways and other interesting ways to do to be better so Sarah where do you get the list if if you were to have someone that said hey I want you to spend the next week let's get together a where would you get the list of prospective customers from so it's everything from my team flagging new businesses it's um other businesses that I you I know other agencies are offering but like they're not getting any press and I'm like they're not doing they're not getting what they pay for Word of Mouth like people just telling me about opportunities there's no like list necessarily it's just doing a lot of online research um I tend to look for companies that you know have a certain level of Revenue the reason why is if you go below below a certain amount you're dealing with people that like literally count every penny so it's not they're PR budget is not a line item and if they're too small they don't have somebody managing the pr agency it's like the owner which is terrible a$2 million doll company probably can't afford or has a head to go spend 10 grand a month or 15 I I was that company and you're 100% right there's no point in chasing smaller companies because they're just simply not going to spend the money but I would think that so the question to me is what's the biggest opportunity people that have good companies that aren't doing any PR or people that already have a PR firm that aren't doing a great job and I would think yeah it's both and we do do smaller companies Jay the reason why is that we sometimes we see a company and we're like yeah it's small but we can help make this company big like we see the Promise and value of it they're not doing any Media or influencers or pre on social media right now and we know if we turn that light on it's going to transform their business um we have have a franchise business um that we're working with we didn't have anything now they are booked like uh through the roof right now we have a restaurant we started working with that nobody knew about now they're like their Mother's Day weekend was totally booked out and they have influencers now dming them asking them to come because of the work that we did like we we sometimes see these smaller companies as like you know what we know we can turn the lights on for these folks really quickly and make a difference I think the opportunity for you is I don't think most companies if you said hey how's your PR reference going I can't imagine most companies Oh no I got that down I think that everybody Laura me everybody knows yeah I'm sure I could be doing better I don't know how to do it and frankly no one's been calling on me to sell me that service so it's not like I'm gonna wake up tomorrow go I'm gonna go look for a PR firm today I I wouldn't even know where to start I know well that's that's another thing is I do do a lot of research into how people find PR agencies right if they're not doing going through referral you know if you're if you're a larger company a lot of people will turn to their board and say hey do you know any good PR agencies and that's how they find them but people without that kind of extended executive network will search I have a post a blog post on my website and it is probably the most viewed and read blog post post of any blog post we've ever created and it's how much do PR agencies cost that's funny because I was going to actually ask you that I was going to ask what the range was you know as we were talking about different sizes of business Jay mentioned $10,000 a month but I suspect it's not that much well so it depends so if you're working with an indiv individual practitioner like there are people out there and a lot of great people out there that uh have worked in agency or have worked in the house but decided just to go independent you know they'll work for a client um you know $1,500 $2,000 a month and they're all they're doing is pitching if they're pitching your project and they're independent and they're looking for those opportunities they don't necessarily have all the tools and resources and and capabilities an agency has but they're pitching you out right yeah most Boutique agencies or smaller agencies start at the $5,000 range that is The Sweet Spot you know from $5,000 and then you start getting into the $10,000 range when you're talking about um you know B2B companies um that where there's no consumer appetite and they don't necessarily want only trade um coverage they want to be relevant across the board so it's a lot more complicated to to put them together you're doing things like surveys you're doing things like by lines you're doing you're you're putting together this whole gamut and then you know you're adding in things like influencer relations influencer relations is a lot of work it's not just about like hey going to give you a product and post about it there is so much back and forth with every influencer that we work with about like the content that they're going to post the hashtags they're going to post the timing that they're going to post sometimes they want money each influencer um probably takes my team about four to five hours to to manage just one influencer sure I want to go back to something you said before you said that it is terrible when you have to deal directly with an owner it's not terrible it's just it's it's what's the issue with it why is that difficult their money it's easy it's their money it's not just the money they don't have the bandwidth for us right that's what I was gonna say they're dealing with so many other things that like we have started and stopped working with a number of businesses where literally at the end of the day they called us up and they said we love you guys but we feel like we're not doing our part of the job because don't have anybody to give you the new photographs provide you the details on the new product or service we're falling short on our side of the of the project super interesting wow that's surprising that surprises me but even having even for some a company like you know both of yours having somebody and they can be junior like they can be like this is their second job it's fine but at least having somebody internally that can be like we can go Hey listen can you um pull us um photographs of um this new chair or this new diot you know we'd love some images so we can push that out in a you know spring pitch or what have you or we want to schedule it out on our social media system so it's you know it goes out of the next couple of weeks just having somebody to do those internal tasks that we don't have access to you can't put a value on that and how do you report back on the results like who manages the ROI so it depends on the client right and so when when we start with a client like our first question for all of our client leads is what will make you look good to your boss what what metrics a great one what metrics does your boss look at what do they like right and you know we'll add in what they like to look at but some some you know CEOs and owners they just love the logo they want to know that they got in a you know Glamour magazine or architectural digest or whatever they like the logo some bosses really like Mass quantity over quality and some want their name in in headlines you know they want their name in print it's not sales huh no oh God we're not sales that's not what we do well I know it's not what you do but at the end of the day I mean isn't that I can't pay you if we don't get an increase in sales that's the problem with PR PR is that's not what PR does that's what marketing does PR does not do that so for example I get your you do a segment on Good Day Las Vegas or whatever right how do you quantify that like how do you how do you tie sales to something that's on broadcast I mean I can watch site traffic I can watch I mean it's not a that Day sales but it's over six months over the next year I mean basically you know the sales line is increased ining if I see the sales line decreasing then then that's not working yeah but it's subjective but you can't know for sure that's coming from PR right you don't know that that you don't know that that's coming from PR you know we do work with clients where we're saying okay create us a promo code and then we can include that we can see how many people use that promo code we do things where when we work with influencers we give them an affiliate link and so we can see how many transactions came through that way most media Publications now most of the like the Hurst the cond nas um even New York Times the Associated Press literally started this where they're creating um roundups of of products and services and they that are all um based on affiliate links so it's the 10 suitcases that you should consider for your next travel abroad you'll literally find this on the asstive Press they just launched in March and if you click on that link and you make that purchase the associated press gets a kickback and I guess when I'm thinking sales I'm talking long-term sales as a result of brand awareness well you know so yeah and you you can if you have somebody doing your Google analytics um you can see where some of the traffic is coming from for sure but if I get you in the New York Times print edition there's no tracking of that I'm not looking for tracking I'm just looking for like health and sales like longterm when when I was doing PR it was that's when we saw the greatest bump in our Revenue yeah um and it was from being in the New York Times And The Wall Street Journal and you know like five to 10 different things all at the same time and I mean I'm not going like back to look at tracking I mean you just know that you're getting all these eyeballs so it's going to result in a boost in Awareness in sales a lot of people will be like well I need numbers to validate it and that's not where're we're doing our job is more brand awareness we will add in all of those bells and whistles if you give them to us for sure if that you want to try to quantify it but like we're looking to establish relationships with editors and influencers um and a Cadence of content on your social media that is that that follows Trends so you're getting views we're doing all of these things so when people encounter your brand there's a continuity and there's just an awareness u a brand awareness um that is consistent across any public facing non-paid advertising you know what attribution is obviously very difficult with this stuff but you said the key word you can't try at least and like I'm on public radio and I'm spending a decent amount of money on it and I'm absolutely confident I I ask customers do you listen to public radio yes like 50% of my customers listen to it the attribution is difficult but you do get some anecdotal things uh uh or I'm sure you've had someone go oh I read that article you do get some an doal things like there are people that go yeah I heard you on public radio so it's something it's it's frustrating though because it would be great if every single person that came in from public radio said oh I heard you on the radio even and then I have my existing customers how many of them came in again that maybe weren't thinking about coming in but heard the ad on the radio totally and I can't yeah that's off the radar screen totally I mean they were already in my customer basees a repeat customer so it's it's extremely difficult to do that but I still try we are running short of time Jay I don't want to leave you out how are your businesses doing it's difficult out there um if 40% of the people buy furniture because they moved and interest rates are 7% so half the people are moving there's less furniture and it turns out the entire Furniture industry from what I hear and I talk to reps is down at least 20% and you know my store is no different and it's you know there's not much I can do about it except wait it out how about picture framing stay but not uh it's not the old days y I mean it's it's it's in my case it's the Baby Boomers the Baby Boomers the youngest baby boomers is now 60 and they're downsizing they're not framing pictures mostly and do their kids have stuff on the wall many of them don't so it's um it's okay but uh it will be better when interest rates get back to something that's not 7% that's for sure Jay we've talked uh a number of times actually over a couple of years I think about your struggle with your inventory issue you know going back to the early days of Co have you gotten your your hands around that have you figured that out here's my new thing which took me too many years to figure out I would argue I will argue every business owner needs to be their own CFO the idea that you think you're going to hire someone and just put it on automatic cruise and they'll take care of it you're putting your life in that hands and I should have been more involved with the inventory numbers and now I'm totally into it that's all I've been doing for the last six months and I'm getting under control I told the buyers look here's what we have here's what we need to get it down to they're all with me they all know what the number is and we are getting inventory for the rest of the year and we're g to get under control because it got out of control and I take full responsibility it's my business I should have been involved with this more I'm really good at not paying attention to stuff that I don't get into there's a reason why I have an accounting degree but I didn't go into accounting I like the other stuff so I'm paying the price and it's okay by the end of this year I am confident we'll get the inventory back to where it needs to be when it comes to the CFO stuff it's interesting because I struggle with like I am our CFO and I'm like H I'm not the right person I don't have these skills I look at all these numbers all the time I still don't fully understand retained income and equity and blah you know the balance sheet so it's interesting that you say that I'm probably in the right spot you know that maybe I should be doing this and my guess is you've got your handle you got to handle on the key things and you are watching I'm not saying you shouldn't have a good accounting person there but when you when you had the CFO before the last one did you feel the same way I mean it seems like this all slipped when he retired and you brought the new one in I was on automatic pilot there's stuff that I should have been looking at back then so it wasn't perfect back then either you just didn't know I'm paying the price for ignoring it 20 years not of take right of basically ignoring it like not watching the inventory enough and I it's it's not like I need to run the accounting department it's a simple case of it's what Lum Musa talks about every week it's about having maybe not even weekly monthly meetings here's the numbers where's the inventory where's the receivables and being the CEO and I've always said I'm I'm 80% entrepreneur and 20% manager but but J there's a big difference between having regular meetings and being on top of the numbers and serving as your own CFO I would guess that if Lou Moscow were here he would say that a company of your size needs to have a full-time CFO I'm not saying you shouldn't have a key accounting person I'm suggesting that ultimately you need to watch those numbers and keep keep an eye on those numbers so when I say be your own CFO it means every business owner and I wouldn't have said this two years ago every business owner off the top of their head should know what their inventory is should know what the receivables are running should know what their their contribution mark is and Laura I believe you know all those things so you're doing a good job on that Jay you've told us in the past that you debated uh telling your buyers just to stop buying uh but you hated doing that because you thought that was like Samson's hair that you you know what you do is sell cool interesting stuff and you need to a constant flow of that how did you resolve that I was half right I I my my new thing is look here's where we're at we need to to get this inventory down buy half as much stuff be more selective with what you buy and let's get more aggressive with getting rid of the stuff that isn't selling well let's the market down quicker it's it's a management thing and my man and you know what everyone that works for me I didn't hire anybody away from a retailer I I I took them from kids out of college that with a theater degree I mean who has turned out to be extremely competent and talented I need to teach him how to run it and I I also never grew up in the furniture business so I've had to figure figure it out and I I so now the answer is here spend uh X this year instead of Y but um I I let it go too far and and that was the artist part of me talking the oh you don't want to slow yeah that's that's people go have you made any progress on buying a uh buying technology a software platform that will help you track your uh inventory better no no I'm working on that that's a huge undertaking that it's triage the triage at the moment this is the year to get my inventory back under control and I'm working on the technology thing but that is no easy flick you you would think oh furniture store there must be 20 programs out there yeah not really um we've interviewed some of not really it's it's it's trickier than it looks and when you hear these ads on on the radio about net Suite or whatever it's like you would spend millions of dollars with with some of that's it's it's not that easy and Laura you have a huge advantage over me in that regard your husband's your Chief technology officer I don't have that Laura do you do you have technology that keeps track of your yarn inventory oh yeah yep would it work for Jay uh maybe but I don't I mean I I wouldn't use it no I mean it's too custom TS yeah I'm me the problem is I'm the largest framing place anywhere as a result no one's software is set up to handle the size of my business so I'm too big to use stuff that's out there that's caned and I'm too small to write my own program to go write my own program I've come to understand would be a million dollars would be it would just it would just that Stu that would be crazy but B Laura you're switching from Custom to uh a can program aren't you in some parts of the business yes but not in other parts of the business so in the manufacturing side we are not switching to can we're keep the custom stuff having Doug do your sof your software is absolutely one of your one of your strengths in the business 100% well you you could hire a Doug couldn't you Jay well yeah but he's back to it's going to cost him a million bucks yeah and my son is in charge of it and he's doing a very good job with it but he's frankly overwhel there's just I got four different businesses I mean it's it's it's I'm I'm I'm going to get I will fix it but it's going to take some time it's not as simple as you would think no I agree yeah it's really way more complicated than than is imaginable and you're talking to someone to remind you again when I started in business there was no computers so like this isn't my thing so um yeah so that's the next challenge the first one is inventory I'm going to get that all taken care of this year and then next year we're gonna we're working on the technology thing but I wish it was as simple as a plug and play oh call up so and so if trust me if I could write a check for 200 Grand right now and get it all done I would do it a second it's not that simple well maybe um Doug probably could adapt our system for that for 200 Grand you just bought dou take him a weekend it would take him a weekend though you want me to wire the money or can I mail you a check how does that all right my thanks to Jay gold Sarah seagull and Laura Xander and to our sponsor the great game of business which helps businesses use an open book management system to build healthier companies you can learn more at Great game.com thanks everybody wait wait don't leave yet if you have a question or a comment that you'd like the 21 hats owners to address send it to me by replying to your Morning Report or by email at Lauren 21h hats.com that's l o r n at21 hats.com do it now before you forget and don't be afraid to tell Jay what you really think you can take it and if you got something out of this conversation help us reach more business owners tell a friend subscribe and review us wherever you get your podcasts follow us on Twitter subscribe to the morning report at 21h hats.com this episode was produced by Jess Theron founder of blank word Productions okay now you can leave thanks for listening everyone [Music]