We Haven’t Signed a New Client in Eight Months

[Music] hello everyone welcome to the 21 hats podcast I'm your host Lauren Feldman this week we meet Jackie Russo the co-founder and CEO of brand Russo and the latest addition to the 21 hats podcast team Jackie tells Jay goz and Laura Xander how she went from working for Barry Diller to starting her marketing agency Jackie also explains why she recently decided to introduce a 4-day work week and why she thinks her agency has now gone 8 months and Counting without signing up a new client the longest such stretch in more than 20 years in business I find it interesting responds Jay you just said this is the first time you've ever had such a long period without new business and oh we went to a 4-day work week H how interesting plus Laura talks about what happened when Venture back competitors came for the nitting industry and how stressful it is to buy and operate another business in another state 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 our principal sponsor the great game of business will let owners know they are not alone in facing challenges same thing with our daily newsletter the 21 hats Morning Report Wii 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 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 Jackie Russo CEO of brand Russo a marketing agency based in Lafayette Louisiana and Laura Xander who is CEO of Jimmy Bean wool a digital yarn store based in Reno Nevada and mateline TSH a yarn supplier based in Fort Worth Texas the episode is titled we haven't signed a new client in 8 months [Music] welcome Jay Laura and especially Jackie Russo who is the newest Regular on our 21 hats podcast it's great to have you here Jackie thanks for having me give us some background where are you how did you come to start your marketing agency sure I am currently sitting in my downtown Lafayette Louisiana office uh which is where I tend to be most days I grew up in this area cinjun country Louisiana ran cinjun uh might ring a bell but after college I moved to Los Angeles uh worked for Creative artist agency segued that into my first kind of entrepreneurial foray with two co-founders of a new startup uh production company and project development and then that landed me on the radar of Barry Diller where I went to go work for him as he was acquiring Home Shopping Network Ticket Master USA Network and a bunch of other companies did that for quite some time most of the 90s and then moved back to Lafayette didn't have a job here kind of like what I was doing there uh went to work for an ad agency worked in-house for a client and then started this agency in 2001 wow that's a lot yeah wow is right where do you stand now how big is the agency so in the 23 years uh that we have existed we have grown now to be about 24 maybe 25 employees Michael who is the chief creative officer is a graphic designer and copywriter by trade he join joined a few months in and we run the company together which is a challenge since we are also married to each other and have four kids together but um I figure the company's going to keep us together no matter what it's a lot easier to get divorced than to break up a company and uh we will be celebrating our 25th wedding anniversary in October that is really romantic really going to stay together because the businesses I didn't think of that I mean I'm just telling you it's a lot easier to split oh I got it wait I want to know if I ran into Barry Diller somewhere what would he say about you he would tell you three things uh one that he did everything possible to keep me to stay including buying the fox affiliate in New Orleans Louisiana so that I could go work there and stay a part of his company he would tell you too that when he first interviewed me he did not hire me he hired someone else and they quit three hours into their first day and my uh starting package got a lot better accordingly and he would tell you three that I think to to this day still I am one of his favorite um of all time because I handled him better than everybody else in his orbit wow wow great answer when I go golfing with him I'm going to ask him what um the story is but wow he will ask you if you can get me back into his company no and I love the fact that you didn't have to think about it and you had your three things lined up and okay this is going to be a great ride we're on here Jackie you told us you have about 25 employ emplo es can you give us a sense for the size in terms of revenues sure you know we have had this weird kind of up down up down like most entrepreneurs and agencies we're sitting comfortably in about 3.5 million a year I expected we'd be at five this year going to fall a little short of that but we'll hit that next year the way we're going and do you specialize in a particular type of marketing particular type of client we do we started with a you know jack of all trades master of none please pay your bills um and let the check clear kind of approach in the beginning and round about year 3 4 five started to lean into our strengths which were the combination of my strategy and Michael's creative and our teams you know that emanate from there and realized we were kind of doing some things different than other places a real focus on branding but being strategic with it we Define branding as the emotional connection that people have with a company product or service so everything you're doing is a chance to build or break the brand it gives us kind of an umbrella to work in we developed a process that we trademarked in 2005 called razor branding that U we've written a book about it's got four core elements Focus promise connection Harmony and it keeps us keep our clients in line and what we realize is it really does work everywhere even as social media came online it still worked it's a really good step-by-step guide but where our heart is is in the B2B space we find that retail is kind of easier uh B Toc is flashier the B2B people have had such a challenge making changes not just still doing things the same way they've always done them so all these companies are reaching the 20 30 40 year mark and needing to evolve and so that's been the space that we have had the most success and in a particular industry in B2B industrial um manufacturing Professional Services are kind of the orbits we live in no I have to tell you what you said makes sense that their core competencies is not marketing it's either manufacturing or distribution and that the world has changed dramatically in the last 20 years and what you said makes perfect sense that that many of them have not kept up with have not evolved along and you're helping them catch up Jay do you feel like you could use branding in your B2B business no okay anything else you want to know Jay are you saying you don't need branding because your branding is already so good or you just don't need branding listen everyone has branding it's it's a question of whether it's good or not but you have a brand your brand might be he's an idiot he dresses bad and he talks too much whatever everyone's Got a Brand do I have good branding for my yes it's all related to my core business the wholesale that I have I sell the picture frame shops and it's related to the think I'm a retailer in it so I do believe we're communicating properly with them and uh resonates with them because we're also framers so we that's part of why the business has been successful we get it cuz we we're in their shoes so yeah yeah don't think we have any off branding with it and I'm not spending a ton of money on anything with advertising anyway but no I don't um listen I got lots of issues that's not the top I've got technology issues I don't have branding issues Jackie you also started kind of a a side business didn't you I did so one of the things that sort of evolved from the social media explosion in ' 0809 was the need for parents to better understand social media and schools and having kids at that time in junior high and middle school I had a personal vested interest in everybody doing a better job with living online and so I started teaching classes and I really like it and I'm good at it and I enjoyed it and so that evolved into teaching marketing classes for small businesses as my agency has grown our clients get bigger and bigger we don't have the Avenue now to work with small startups but I have a passion for them and those small businesses are really what makes the the world go around and I want them to have professional guidance even when they can't necessarily afford an agency so I started teaching these brand Builder classes built an entire training Studio booked up a whole year of sessions it was awesome it was 2020 they all got cancelled so I took all those classes recorded them and put them online brand State you like university.com it's been great people can come in take the training learn how to do things they get monthly lessons and guides and knowledge and it's awesome and then spent three years getting certified in the state of Louisiana we have a couple of programs through our unemployment fund that reimburses up to $3,000 per year per employee for professional development training so now a business can find their recent graduate or a secretary assistant who's going to do some marketing and put them through marketing school and be refunded for the cost that it takes it's a win-win for everybody so now we're evolving it even further have brought in four amazing trainers so now we cover sales marketing uh professional development personal development Communications leadership all the HR soft skills and um anybody can bring in a trainer into their space and believe smarter who's signing up for these courses well we're still focusing on small businesses and so that's what's happening right now we're seeing it from retail stores a small jewelry store a clothing store insurance agents um Realtors and a lot of companies that have gotten to that one twoyear Mark and don't know how to take that next step they don't know how to get the word out they think it's about spending money on Advertising not really appreciating the free I mean it takes time but not cash resources they can utilize to build their brands and so I am seeing people signing up knowing that they want to have a better culture they want their employees to be better trained and so it's kind of evolving from there didn't you also recently take some kind of cruise we did so if you're going to give me a chance to U put a bunch of people in a room teach them some important things which I always learn something at the same time it's not completely altruistic and go on a vacation I'm here for it all day long so we started something called The Women's Summit at Sea we just did one in September we sold out our first one it was through Royal Caribbean we sailed out of Galveston it was a 5-day uh Caribbean we went to KMEL and costaa but when we were at Sea half days we had classes and I brought in Melissa Bowen who has the authenticity Center and it was her talking about internal development uh soft skills boundaries trust she is a therapist by trade and a coach by training and then I talked about marketing so it it's really about building your brand from the inside out and she's Bernay Brown certified so it kind of tied all those pieces together it was awesome so we've got two scheduled for 24 one in April that'll be co-ed one in September that's all women again and we just signed the contract with Royal Caribbean for 25 because we're taking our show to the Mediterranean I'm wondering yeah like is there anything that's going on wrong in your business or is everything just perfect let me give you the whole list so things that go wrong um in the 23 years the number of times that I've hired people that were mismatched Misfit we didn't have a very good Training process we still don't we're improving it but boy is it far from where it needs to be I looked back in the 23 years of this business the longest drought we've ever had in between new clients was three months and that only happened three times in 23 years until this year and we are on our eighth month and still counting so the Palm sweat heart race fear okay great I'm glad you're suffering too oh my God that makes me feel better oh eight months and Counting it's like Jackie how do you explain that why do you think that has happened I think it's a lot of things I think it's we um we upped our game in terms of the targets so we're going after bigger companies and I think they have a slower process I will take that as a a big part of it I think that we changed how we do our proposals and I don't think that it was a change in the right direction so we are quickly backtracking and uh I think that we became too reliant on some outgoing activity instead of staying rooted doing that and continuing to use our energy in um you know I go speak at a conference which I do all the time we get a client we wrote the book we got clients and we need to go back to those Grassroots things where people get to know us and trust us we ski that step and that's a mistake let me add on one more piece the whole country is having an anxiety attack and that's not helping any between the global warming and the politics and Ukraine and you can go on to 10 more things school shootings I really believe the whole country is in having anxiety and the list of things you're going to work on first when is that oh let's go hire somebody to help us with marketing and spend some money I just think that some piece of it is a littleit I'm not saying that everything you said isn't true but I think there's some piece of it in there that people are hesitant I mean we keep saying we're like this decade sucks this decade just sucks I mean we keep waiting for like the pressure to be relieved and it just it just shows up in like different ways we probably realistically have somebody cry at work once every two weeks last time you were on Laura you talked about some of the challenges you were facing in terms of a marketing team or sales team that wasn't performing well and it was they had started to go at each other a little bit yep has that resolved itself how are you doing with that better um it's not resolved but it's definitely better but it was ugly and it's been just exhausting I don't know what other word to use other than I mean we're all just exhausted from it like the emotional turmoil of all these people not getting along and not getting their work done and they're not hitting sales goals in your case though that's partially due to you bought a new company out of state I mean that's just not an easy thing to do and it would be naive to think anyone's going to do that and not have I mean this is power for the course I mean it is what it is you bought a company out of state there's only one of you you're going out there you're trying to inject your quote unquote culture into their culture so is that right Laura I mean have you had these problems since you bought that business or is it something that has surfaced more recently um there's right and not right I mean part of it was yes inter compan culture that said the people that weren't getting along they are out of state but they don't happen to be in that factory I mean it's more a remote worker versus you know here in the office worker kind of problem um and yes there's some definite cultural differences even in the remote workers that we have in our Texas business who don't live in Texas so it's more old school versus new school I guess or you know the old Guard versus the new guard but then there's we've brought in New people into our business here in Nevada that are remote and there's some conflict there I mean Jay you may recognize this and Jackie you may too you know you have so many people that have been with you for quite a while and so you've promoted from within and promoted from within and then every once in a while you have to bring somebody in from the outside at a senior level and they don't always get along with everybody or you don't bring someone in from another level and they just they're choking and they're over their head if I made a history chart I could show you I would say we've had four meltdowns in the last 40 every 10 years somebody that's been there for years got over their head I let it go too long and it started causing and then finally it broke they left and things got much better I've hit four of those that's exactly yes exactly I've h four of those episodes yep and people get in over their head life circumstances may change and so there's you know they're factors as well and then at some point I don't know if it's the right decision or the wrong decision but you bring somebody in from the outside that has the experience and that can do what needs to be done and then that's just a disaster as well the other problem is this not having people in the office when you work with people every day and you're having lunch being face Toof face with someone is one thing when you're never face to face and they're over here and you're over there it's very easy to get upset and think I can't believe it and I I've been through that a thousand times where you sit down okay oh it's only oh it's Laura blah taking that interpersonal piece out of it and have it all online and texting it's not normal it is normal now but it's different we don't think you can work that way not in a collaborative environment so we have always since day one had a flex schedule we've always given people the opportunity of working remotely I mean I was eight months pregnant with our second kid when we started the company and I went on to have a third and fourth so trust I worked remotely but we wanted people to have a reason to come back together and so we create these opportunities where first of all we make it easy so it's not mandated you come you go everybody has to communicate so we know you know if you're going to be there today you're going to be there we have professional development sessions together we bring in someone the aforementioned Melissa Bowen authenticity Center who does our coaching with us so we all get to collaborate and work together and on the off times when we're not having a session with Melissa we have lunch together it's important for us to spend time together Jay you're 100% right we also make I mean this isn't quite the level of the therapist in billions who coaches up the Traders we're not there yet by any means but we do have not therapy but coaching available to every employee one-on-one that all I do is pay for I don't know who shows up I don't know what they talk about has nothing to do with me but I have happy people who want to be here so we would we're posing and we're this is our our theory that trying to have a collaborative environment and have everyone remote we believe is very difficult we don't know maybe somebody somewhere figured it out I'm not I don't know all we know is we think that would be very very difficult if not impossible to do so I'm going to disagree in some ways so my Texas team the creative side of that team is 100% remote and it is dialed it works I mean these people are best friends they laugh together like you hop in a meeting they use slack but they were all hired that way you know they're from all across the country they've all got similar experiences maybe we did a really good job hiring I don't know I mean you know I mean it's luck but it's dialed people get along they communicate really well we've had a couple of people that have we've hired into it and they haven't worked out because their communication skills just aren't the right kind that lend themselves really well to this kind of work environment where we're having trouble is this remote team for the most part is very direct right you know they're direct they're um a little snarky they've got dark humor you know it's all got the same sense of humor so their personalities mesh so they're able to talk to each other in a way I mean they would be friends so the people that get along so well do they any of them report to each other or are they they all at a similar level no they get they report to each other okay that's why I pose it as a hypothesis I still think it's difficult um it's so that side of it has worked really well the other side here in Reno where we have a hybrid and we have a couple of people that are in the office and then we have other people that are remote that is not working as well because you've got a bunch of people who do see each other all the time who do share like the laughs and then you've got people that aren't there and so their communication is just it's different you know I mean the people that are remote are Outsiders they're not the ones who are in house and so that transition has been tough the hard part is for us most of the talent is remote you know we're in a very very small industry and we live in a very small City I mean not very small but pretty small so for us to find the best people they're from all across the country they're not here in Reno so I really think that our future is a remote future Jackie you went to a 4-day work week this year correct we did on April 1 which everybody thought was a joke but it's still happening so jokes on them and uh we did it as a three-month trial and we found lots of pros and lots of cons and it took some work around and figuring it out we don't charge by the hour and so we are have always been Project based and as long as the project gets done on time everybody's happy so it's been about managing that so the projects stay on track and the people are still off on the Fridays wait wait wait there's two key questions a is is this four days at 10hour days to give you 40 hour it's 4 eight hour days so everybody's working 20% less correct and B is anybody covering the business on Friday well uh we have a couple of part-time people who are still college students and uh we didn't want to cut their hours and so gave them the option of still working on Fridays if they wanted to and so one of them opted for that trust me when I tell you this maybe it'll work out beautifully I just find it interesting and I'm not making any judgments I find it interesting you just said this is the first time you've ever had such a long period with new business and oh we went to a four-day Work Week H how interesting that was six months ago yeah yeah everybody's working 20% less hm interesting I hear you and that question has been posited before so I have given it lots of contemplation went back and looked at the numbers we have had the same number of uh discovery meetings we have had the same number of proposals we just have had less yeses how is that possible that people work 20% less and they're getting the exact same output out well it's funny you would ask Jay when I thought I wanted to do this I went to every employee oneon-one and had a chat and said I'm considering this tell me what what this would be like for you and the two people in this company who spend every day saying things like my list is too long I can't get it all done blah blah blah when I went they were the last two people I talked to and when I went to them I said I am most concerned about you because I know how busy you are I know how much you have on your plate we're done at 5: everybody need to go home and eat dinner with their family I don't want that to change one of them brings their uh kid to daycare and I didn't want them to not be able to do that anymore by leaving the house early how can we do this you tell me and both of them the people who never had enough time always late on deadlines said we can do it I said okay let's do a three-month trial the two of them were the first two people to say this is working they have not complained once and when we did our three-month recap in one of our professional development sessions Melissa was guiding this conversation because I'm like I'm out we're going to talk about it we're going to make a group decision so she had everybody go around the room and talk about pros and cons and their personal experiences the person who the most um frustration with workload and biggest concern who has not had a problem with any of that since we went to 4 day week was the first person to say this is important this matters I can't go back it has saved my marriage and I was like well that's more important than anything else so okay we'll find a way to keep making it work and is an outsider business person I'll be interested to ask you in a year yeah I think having people work 20% less and having them go oh no this is working out great oh my God what a surprise people like working 20% less and making the same money oh my god really that work people are happy with that wow so I don't know I I don't know you know what I find I find that they work faster they work more efficiently they ask more questions in the beginning so why couldn't they have done that for 40 hours there you go probably could and I know we're not going to be as profitable I have no doubt about that okay that's a fair statement and I I respect that no doubt I'm willing to trade some profitability for some happiness you know what I fully respect and can appreciate that the question is the word sum yeah that's the question well and I don't know how much yet you know I give it a whole year after a year we'll really have a good look at the numbers yeah fair enough and math wise is the conversation like look our raises aren't going to be as big year to year you know there's a tradeoff I mean there's a financial tradeoff for everybody there might be is that part of the conversation it hasn't been yet right now we did a really healthy round almost 50% in 22 and so uh everybody's sitting pretty happy right now also just about everybody's tied into profitability so they want us to be profitable tied in how uh percentage of certain projects and then also overall retainer and you said you expected the this you you did this expecting profitability to decline well maybe not decline as much as not grow as rapidly but I want our our Mantra from day one has been happy humble and hungry that's who we are that's who we look for and so happy has to be valued to me over dollars and did you think profitability would uh not grow as fast or not do as well because Revenue would not grow fast or because you wouldn't be operating as well as you had before when the drought is over and the people who are just hanging out there getting contracts approved and reviewed and through legal and all the things that it takes months and months to do I will not be able to onboard as many of them as often as possible because I can't take away from the time dedicated to the current clients that we have we have some new employees I want to onboard as well I feel like I can keep it balanc but when it comes down to it in my opinion I'm okay thinking it's going to take us that much longer to get to 10 million a year or maybe we tap out at8 you know whatever that might be but if I am able to keep happy people happy and our clients every single client has told me that they are getting their work as quickly or quicker that it is as right or better that they find that the first draft is closer to right than the second draft used to be and they don't notice that we aren't working on Fridays okay I'll just challenge one thing you said hey happy over dollar okay let's let's not be in fantasy land here there needs to be a mix there there needs to be some absolutely yeah cuz happy oh we don't make any money but everyone's happy yeah that's going to run out sorry so let's that wouldn't make me happy and I have to be happy too let's just throw the word balance in there like yeah certainly it shouldn't all be up my money it's happy is a it's all Balancing Act but yeah but that goes back to the Women's Summit AT C thing we just did that was balanc that was about if we're going to have work life balance 52 is not balanced 43 is balanced now if I ran a gas station and I need a cashier at the front desk that can't be done remotely no you're that's my business no I can't shut down on Fridays that's just not an option I have privilege in that the kind of work we do for the kind of companies we do it for we have the ability to do this and not every company can do it and not every position can do it so I know that I sit in a seat of privilege I get it but I'm going to take advantage of that privilege and if that privilege means I get to have Fridays off I'm taking it and my kids are all in college I have one who's graduated but three still in college I look to the co-workers some of whom now have birth years they start with a two which freaks me out and they're starting to build their families and I think man look at the stuff they're going to be able to do with their kids on Fridays are you taking Fridays off Jackie oh yeah um now Friday off to me probably looks a little different than Friday's off to other people to me Friday's off sometimes means I am off I am traveling I'm away from my desk my computer my everything and I am off sometimes like tomorrow it means that I'm a guest on another podcast not as good as yours Lauren there's another podcast no no no no we know there's no other Lauren and I will be doing a little bit of work to get ahead because I'm going to be out for two weeks and so it's balanced but you know what I don't have is an influx of emails from my team I don't have my phone ringing off the hook so I have quiet thinking time and writing time and I am so productive now on those four days have you had any client emergencies on Fridays we've had two and both have been handled we don't die on Fridays we just aren't working there aren't a lot of advertising emergencies let's be clear no listen I accept everything you're saying I can't do that cuz I take care of customers but hey I hope it works out I will be interested to see in a year from now if you're still in the same place I wouldn't bet against it I just that's interesting check How concerned are you about the 8mon drought drought are you making contingency plans um are you changing the way you Market your marketing we are walking the fine line between doing the same thing and expecting a different result is crazy coupled with you have to keep going and and eventually you'll get it right and you know even a Hall of Fame hitter Strikes Out 70% of the time so I'm somewhere in the middle of those two things we are making tweaks and changes we like to test drive marketing ideas on ourselves and when they work then we bring them into our clients so we're doing two or three new things that are already starting to have a positive impact and I feel like I feel like the next time I'm on this show with y'all assuming I get invited back please then um I think I'm GNA have a yes or two to talk about which will make the eight-month drought over and I'll feel a lot better all right I want to talk about something else I recently highlighted a story in the morning report about a couple of the story referred to them as Tech Bros who decided they wanted to take over the knitting industry and they bought the domain named knitting docomo to teach the the Grandma's running knitting companies how to really run a business Laura you've mentioned these guys to us previously but it it sounds like we have an kind of a conclusion to the story now did you see the story I'm talking about I did yeah yeah I read it did you enjoy the story I'm talking about it's hilarious yeah super funny and it's just so classic uh you know the irony of this is that this company has been so off of my radar that I had totally forgotten about it I've got the same thing in the framing industry there's some tech people that got in they're going to show all the greedy framers that are overcharging everyone which is disgusting in itself cuz framers are not overcharging people but they're going to straighten out this industry and it yeah hasn't worked they just keep hemorrhaging tens of millions of dollars so yeah you actually have to know the indust you actually have to know something about business this isn't a Commodities based industry this is a communitybased industry and for the most part yeah sure there's some like loow hanging fruit and there's some money to be made you know especially for people who are new you know and as Joann's just laid off a ton of people I mean that opens up some stuff withit Joann's Fabrics yeah yeah you know that's funny they're in the frame business too so sure is there some money to be made but it's I mean there's a reason that a lot of the businesses in our industry have been around for a hundred years because loyalty and being familyowned and all those things they matter the businesses you're talking about Laura are they you know knitting shops or yarn shops um around the country is that what you're referring to shops or manufacturers Just people that actually know what they're doing I mean it's that simple it's unbelievable these people go to Harvard or Yale or Princeton or whatever they get some venture capital and they think they've got it all figured out and they never spend the time to actually figure out what the business is about and how it works and they go jump in with somebody else's money and they burn through tens of millions of dollars and then what a surprise they go away one day yep and they focus on competing on price not building a community listen 20 years ago you didn't hear the phrase burn rate you didn't hear the phrase scaling yeah you didn't hear the phrase C customer acquisition cost yeah here's a word here here you want to get your MBA in business techie guys and women here's a word you've never heard of margins right that's the problem they don't have any margins and they think they're going to make up for it with all this other stuff we're losing money on every transaction but we've got millions of them we make it up in volume that's the old joke I agree and I believe that you know people are responsible for their own choices but are we going to put any blame on the Publications that run these fastest growing AB totally of course I'm not saying there aren't some of them that figured something out clearly there are some of them but it's just I've seen some of them but we've got the other big one that raised 70 million they just laid some people off the other day you know word on the street is they're having trouble paying their bills and so here we go Laura I'm curious these guys at least according to this story they sound like total jerks they came in they were insulting to the people they wanted to do business with everybody else was unsophisticated they had some money I don't know if it was Private Equity or Venture Capital but they had investor dollars to spend suppose they hadn't been jerks suppose they had come in and gone after business in a way that some of the old line 100-year-old companies hadn't gotten up to speed on could they have done better sure yeah of course I mean there are new businesses in our industry popping up all the time and if they can find an audience that's great if they have something new to contribute that's even better because it makes our entire industry better but when somebody's coming in with the explicit goal of not being a member of the community and not I mean there's there's just this weird like kind of karma stuff going on you know what you're being kind it's not about being a member they're there's a difference between not being a member and being an and I've seen them do it in their frame business they're to people yeah but there are members of our community that are also and but they still contribute to the community I mean I'm not saying I'm not you're suggesting that everybody that's a member of our community is a nice person and that's not true no I'm suggesting going into a new industry and being an is not gonna It's a Small industry it's not a good strategy no it's not and I I know not in this world maybe if it were tired or guns or you know no for sure no in Big Business maybe you can get away with that there was someone that came into the framing industry of they made him president got big money behind him and I said listen there's three things you need to know about you know I try to be nice I said there's three things that you need to know one is we're in a design driven industry two is you have to have inventory because people sell the stuff they need you to have it and three is it's a it's a relationship small business they managed to screw up all three of those things and their business is probably 25% the size it was when they got into it I mean and most of the vendors in this business I mean it's changing but a lot of the vendors and the suppliers are small family-owned businesses so they're missing the Loyalty piece this whole little world is based on relationships it's based on loyalty it's based on community so if you come in and you're insulting people then of course sure we'll take your money if we're A supplier I mean sure we'll let you participate but there's no loyalty you know we're going to stand behind the family-owned business that's not been jerk and who's been here for 20 years cuz we know that they're going to stick around we've watched this before people come in they're not in it because they love the craft they're not in it because they love the art they're not in it because they're creative they're mining you know they're coming in and they're trying to build a strip mine Laura you said that you'd forgotten that these guys even existed which is an indication of something the story that I highlighted indicated that they've shifted their strategy um based on the reaction they got they've given up on trying to sell to people who have been knitting uh for some period of time they' given up on the existing market and now they're just going after people who are just getting into knitting and trying to start fresh with them does that strike you as a workable strategy uh I think it's one it's a couple years too late two I mean that would have been great like in 2020 you you know when there were all these new people but no I mean unless they're going to go after like the Joann's customer I guess I they're just irrelevant there's another piece of this when you say strategy you can only have strategies like that when it ain't your money when you can have a quote unquote burn rate of your venture capital or of your public money or from some rich person people like Laura and I don't have the luxury of changing failing strategy after failing strategy because at some point lose our house and we're living in a coward Bar Box down by the river these guys they keep giving them money and they keep changing their strategies until one day oh so and so's gone that's pretty new phenomenon over the last 20 years usually people that succeeded figured it out and built on it now they just keep doing stuff thinking they got it figured out and keep hemorrhaging money and I think this goes back to even us having this specific podcast in general which is geared towards Evergreen small to mediumsized businesses often where the founder or the owner is operationally involved versus building something to sell and that's what these guys are all doing I mean they don't have any emotional you know or lifestyle interest in having something either for the rest of their lives or to pass down or whatever they're playing poker I I want to Circle back though to something because I have had a revelation whever this goes next I have been I mean almost to the line on buying another agency and they fit nicely with us retainer base B2B kind of fits our Vibe but in another state and after this discussion I'm like yeah I'm not doing that wow well you know Laura's done that I know and I heard her talk about how challenging it is I look I'm really only 32 but I look like I'm 60 I look like I'm Jay's age laori you're not sorry you bought the business though are you I am not sorry um not at all because right now like our Reno business is is in the red right now um but our Texas business is doing really well and so it's paying the bills and it just goes back and forth and back and forth you know but they're slight they're very different businesses they're complimentary but they're not it's not the same right one's manufacturing and one's retail so when one is down the other one can be up I don't regret it but I'm tired Jackie you just said something is consistent what you said previously you said happy can be more important than more money so I can assure you if you buy an agency out of the state it's not going to be a happy fun there's going to be lots of challenges and it it begs the question I have a different word than balance balance was important when you have little kids now I talk about alignment does that align with what you want it at my age I need more money less than I need more aggravation right now I don't I've got it under control like I really don't need the more money whereas when I was younger it was different all right my thanks to Jay goz Jackie Russo 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 ren21 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 tharon founder of blank word Productions okay now you can leave thanks for listening everyone [Music]