Christian Brim, founder of Core Group, about the realities of leading a business through growth and financial challenges. Christian shares his journey of scaling back to grow intentionally, emphasizing the importance of sound accounting processes and focusing on margin improvement. He dives into the role of a leader in guiding a company towards meaningful goals, not just growth for its own sake. Christian offers actionable insights on managing labor efficiency and building a sustainable business model that balances profitability with purpose. His leadership philosophy centers on creating value for others, staying true to your unique strengths, and making tough decisions that steer the business in the right direction.

Want to learn more about Christian Brim's work? Check out his website at https://christianbrim.com/.

Connect with Christian Brim on LinkedIn at https://www.linkedin.com/in/christianbrim/.

Key Points with Timestamps:

• [00:00:30] Introduction of Christian Brim and his work with creatives.
• [00:04:21] The role of a CFO in business leadership—balancing investment with return.
• [00:09:00] Narrowing the scope to target clients and focusing on core strengths.
• [00:14:00] The hardest decision in leadership: intentionally scaling back to grow.
• [00:16:00] Leadership as guiding the team to achieve business goals, not just growth for growth's sake.
• [00:20:07] Communication and alignment between different business functions.
• [00:23:44] The importance of sound accounting processes for business leaders.
• [00:25:26] Key financial metrics: gross margin and direct labor efficiency.

Transcript

00;00;00;00 - 00;00;30;20
Craig Andrews
I was in a coma for six weeks while the doctors told my wife I was going to die. When I woke up, she told me the most fantastic story. My team kept running the business without me. Freelancers reached out to my team and said, we will do whatever it takes. As long as Craig's in the hospital. I consider that the greatest accomplishment of my career.

00;00;30;23 - 00;00;51;10
Craig Andrews
My name is Craig Andrews and this is the Leaders and Legacies podcast where we talk to leaders creating an impact beyond themselves. At the end of today's interview, I'll tell you how you can be the next leader featured on the show.

00;00;51;10 - 00;01;01;19
Craig Andrews
Today, I want to welcome Christian Brim. He is the founder of core Group. Christian is probably one of the most interesting,

00;01;01;19 - 00;01;04;14
Craig Andrews
CPAs I've talked to. And,

00;01;04;14 - 00;01;17;28
Craig Andrews
he has a unique approach as unique, perspective. Christian works primarily with creatives who need to be profitable. And it's the subject of his book.

00;01;17;28 - 00;01;19;21
Craig Andrews
Prophet first for the creative.

00;01;19;24 - 00;01;39;13
Craig Andrews
And so even if you're not creative, I think there's some valuable lessons here. I think a lot of business owners don't have a command of financial literacy. This will not be an episode that basically you can go, you know, get your CPA certification at the end.

00;01;39;13 - 00;01;45;26
Craig Andrews
What I know about Christian is he's going to put in a language that's relatable and actionable.

00;01;45;29 - 00;01;51;19
Craig Andrews
And so listening, I'm looking forward to this episode. Christian, welcome.

00;01;51;21 - 00;02;02;15
Christian Brim
Thank you for having me, Greg. I, I'm assuming that you haven't talked to a lot of accountants. If I'm the most interesting you've spoken to.

00;02;02;18 - 00;02;03;01
Craig Andrews
Well,

00;02;03;01 - 00;02;07;22
Craig Andrews
so my, my wife's ex-husband is,

00;02;07;22 - 00;02;09;01
Craig Andrews
was a CPA.

00;02;09;01 - 00;02;10;29
Craig Andrews
And eventually a CFO.

00;02;10;29 - 00;02;33;09
Craig Andrews
You know, I, I worked in industry for a while, and if I talk more from the, from the CFO perspective, I noticed that there's two types of CFOs. The overwhelming majority of CFOs came through the controller ranks. Their sole mission in life is to tell you how much.

00;02;33;16 - 00;02;51;00
Craig Andrews
How no matter how much money you're spending, it's too much right? Size you for whatever. If you saved some money. And. True story. I made a capital equipment purchase where I went off and negotiated a smoking good deal from a fortune 100 company.

00;02;51;00 - 00;02;55;06
Craig Andrews
And we were just a small startup, and I got 25% off,

00;02;55;06 - 00;02;55;18
Craig Andrews
price.

00;02;55;18 - 00;03;01;11
Craig Andrews
And I went and told the CFO and her immediate response was, go ask for more.

00;03;01;14 - 00;03;02;06
Christian Brim
Yeah.

00;03;02;06 - 00;03;10;25
Christian Brim
Yeah. I mean, it's not that the derisive term bean counters isn't a well earned moniker. It is.

00;03;10;25 - 00;03;18;10
Christian Brim
And, you know, you you definitely need those. Know people in your organization to tell you, you know. No,

00;03;18;10 - 00;03;25;03
Christian Brim
I, but, you know, our role as, as advisors to small businesses is,

00;03;25;03 - 00;03;25;20
Christian Brim
not

00;03;25;20 - 00;03;26;25
Christian Brim
that negative.

00;03;26;25 - 00;03;29;18
Christian Brim
Certainly we can point out the,

00;03;29;18 - 00;03;33;05
Christian Brim
potholes and bridges along the way, but,

00;03;33;05 - 00;03;36;24
Christian Brim
we're not in the business of of just saying no.

00;03;36;26 - 00;03;38;01
Christian Brim
Yeah.

00;03;38;03 - 00;03;44;11
Craig Andrews
The other type of CFO that I've seen, which is much more rare, is somebody who comes from the investment community.

00;03;44;11 - 00;04;00;06
Craig Andrews
And when you talk to them they're open to budget discussions. But their number one question is if we spend, you know 10 million on this, what will we get in return. And if the answer is 20 it's a very interesting conversation to them.

00;04;00;09 - 00;04;21;16
Christian Brim
Right. Yeah. I mean I think a a competency of oh. And it's a, it's an interesting term that's bantered around, especially with small business owners, because there's a lot of fractional CFOs now. And I, there's, there's usually a disconnect between what a CFO actually does and what the marketplace thinks they do.

00;04;21;16 - 00;04;26;03
Christian Brim
I think a good CFO is part of the management team.

00;04;26;06 - 00;04;51;04
Christian Brim
That is, is, yes, a holding the rest of the team to accountability for things like return on investment, you know, and profitability and margins that that's certainly part of their job. But I think the bigger part of the job is to help the leadership team navigate the potential pitfalls with their business plan. So, you know, we want to grow this much.

00;04;51;06 - 00;04;56;22
Christian Brim
Okay. What does that look like for the business? What are the potential pitfalls if we do that?

00;04;56;22 - 00;04;59;12
Christian Brim
Being more proactive in nature.

00;04;59;14 - 00;05;11;00
Craig Andrews
Yeah. Well, I think that's I think that's as people are listening and they're trying to decide whether they're going to listen to the rest of the episode.

00;05;11;03 - 00;05;14;18
Christian Brim
I swear it'll get better there. I mean.

00;05;14;25 - 00;05;22;29
Craig Andrews
I think that's what they're on guard for is, you know, they they look at the, you know, the,

00;05;22;29 - 00;05;41;11
Craig Andrews
you know, the controllers, CFOs, financial folks, as you know, basically they're, you know, the the ugly stepmom that just goes around and says, whatever you want. Their answer is to say no. Right. And what I hear you saying is no.

00;05;41;15 - 00;05;52;21
Craig Andrews
If you're doing your job, your job is to help the business accomplish its goals. Yes. And to do it in a way that that doesn't leave the business shipwrecked.

00;05;52;26 - 00;05;58;04
Christian Brim
That's exactly right. My. My father in law is also a CPA. And he was corporate.

00;05;58;04 - 00;06;11;27
Christian Brim
But then he moved into bankruptcy consulting. He came out of the airline industry. So he had a lot of, experience in that. And, he is what you would call the quintessential hatchet man. Like, his job was to come in and fire people and tell them no.

00;06;11;27 - 00;06;21;18
Christian Brim
And he, you know, frankly, he's an asshole. And he fit that job very well, right? And sometimes you have to have people like that. I get that.

00;06;21;18 - 00;06;31;17
Christian Brim
Unfortunately, I think a lot of CPAs are much more, comfortable in a spreadsheet than in a conversation.

00;06;31;19 - 00;06;35;05
Craig Andrews
Yeah. Yeah. Yeah. So,

00;06;35;05 - 00;06;37;15
Craig Andrews
and I think,

00;06;37;15 - 00;06;46;07
Craig Andrews
well, let's back up, because we won't get into. We won't get into that a little more deeply.

00;06;46;07 - 00;07;01;02
Craig Andrews
But let's get back to how you ended up focusing on creatives. And again, I think you have a message that's regardless of, you know, if you're a creative agency or not. I think there's something valuable here for everyone.

00;07;01;02 - 00;07;05;03
Craig Andrews
But how did you end up deciding on creatives?

00;07;05;05 - 00;07;05;19
Christian Brim
Well,

00;07;05;19 - 00;07;08;23
Christian Brim
we did a very methodical MBA type approach.

00;07;08;23 - 00;07;10;11
Christian Brim
I asked my team,

00;07;10;11 - 00;07;24;07
Christian Brim
go through your clients and say, ask the answer two questions. One. Do you like working with them? And two. Do they value what you do? And that was the only two questions.

00;07;24;07 - 00;07;27;25
Christian Brim
Being accountants, you'd think there'd be some kind of profitability analysis there.

00;07;27;26 - 00;07;30;11
Christian Brim
No, we didn't do any of that.

00;07;30;11 - 00;07;35;24
Christian Brim
Just answer those two questions. And over half of the clients that were on that list,

00;07;35;24 - 00;07;39;23
Christian Brim
were in Creative industries. And so that's what we decided to lean into.

00;07;39;25 - 00;07;49;24
Craig Andrews
Yeah. You know, that's so, so simple and and profound. I mean, when, when I'm working with people,

00;07;49;24 - 00;08;04;12
Craig Andrews
I can't count the number of times that I've had a client come to me, and it's very clear that somebody gave them some instructions that they need to be either you know, someone to everybody or they had to go focus on on this.

00;08;04;13 - 00;08;19;19
Craig Andrews
It was very clearly not who they were comfortable being. And my advice has always been, you will never be as good being someone else as that someone else you're trying to copy. Why don't you be your best? You.

00;08;19;21 - 00;08;23;23
Christian Brim
Yes, 100%. No one else can do it. Yeah.

00;08;23;25 - 00;08;28;15
Craig Andrews
And you don't have to try. You just wake up every day and do it naturally. Right.

00;08;28;17 - 00;08;37;16
Christian Brim
Now, that. That's a good point, I think. I think a lot of business owners, myself included, you know, you get into business and you don't really have a lot of expectations.

00;08;37;16 - 00;08;50;27
Christian Brim
And, or you have expectations that aren't grounded in reality. But we tend to play roles around what we think other people want us to be or what we think.

00;08;50;29 - 00;08;56;19
Christian Brim
That that shouldn't be, rather than being genuine to,

00;08;56;19 - 00;09;03;25
Christian Brim
who we are and you might be successful, but you're not going to be satisfied.

00;09;03;28 - 00;09;20;01
Craig Andrews
Yeah. Well, and something else you did in that and this is actually more, a little bit more of a marketing question, but you are narrowing your scope of potential clients. You weren't expanding your scope. What knowledge what motivated you to do that? Well.

00;09;20;15 - 00;09;27;11
Christian Brim
We we had gone through, I call it the wilderness. I, I had got,

00;09;27;11 - 00;09;32;27
Christian Brim
become so fed up with running my accounting business that I left it,

00;09;32;27 - 00;09;39;06
Christian Brim
I left it with my brother, who was my partner in charge, and I went off and started a software company for two years,

00;09;39;06 - 00;09;42;07
Christian Brim
because I was just sick of my sick of clients.

00;09;42;07 - 00;09;45;28
Christian Brim
Sick of employees just fed up with it.

00;09;45;28 - 00;09;46;28
Christian Brim
Unfortunately,

00;09;46;28 - 00;10;00;03
Christian Brim
the business did not perform as well as it should have when I was out of it. And so I had to come back in. But I said, well, we're going to do we're going to do things differently. And it was at that point that we implemented,

00;10;00;03 - 00;10;04;23
Christian Brim
iOS, the Apple entrepreneurial operating system by Gina Wickman.

00;10;04;26 - 00;10;15;03
Christian Brim
And part of that process led to the wholesale change of business. My I bought my brother out. I had another minority partner,

00;10;15;03 - 00;10;16;19
Christian Brim
bought him out.

00;10;16;19 - 00;10;19;18
Christian Brim
We changed we actually continued to shrink,

00;10;19;18 - 00;10;22;17
Christian Brim
shedding lines of businesses,

00;10;22;17 - 00;10;25;02
Christian Brim
services, offerings that we cut.

00;10;25;02 - 00;10;25;20
Christian Brim
And,

00;10;25;20 - 00;10;32;06
Christian Brim
the, establishing a target market was just part of that process.

00;10;32;09 - 00;10;36;01
Christian Brim
We had to scale back before we could grow further.

00;10;36;01 - 00;10;46;05
Christian Brim
I think what, what my colleague calls an entrepreneurial inflection point. We we reached the point of my personal limit.

00;10;46;05 - 00;10;52;15
Christian Brim
And we couldn't grow beyond that. And so I had to grow my self,

00;10;52;15 - 00;10;57;22
Christian Brim
a lot of self work to be able to be what the company needed.

00;10;57;22 - 00;11;00;24
Christian Brim
It needed it to be needed me to be.

00;11;00;24 - 00;11;11;00
Christian Brim
And that allowed us to work on these tactical things like, you know, establishing a target market. We'd had a target market.

00;11;11;00 - 00;11;11;13
Christian Brim
I'm not

00;11;11;13 - 00;11;17;16
Christian Brim
saying we didn't have one, but it was not nearly narrowly as narrow defined as it should have been.

00;11;17;18 - 00;11;39;24
Craig Andrews
Yeah. Well, and when we were in the green room, one of the things you said was, you know, you didn't use an MBA approach on this, and I didn't respond. But, you know, that made my heart leap with joy. And I've I've realized in recent years I have a real disdain for MBAs. Not for them personally. I just look at what they do to very good companies.

00;11;39;25 - 00;11;57;06
Craig Andrews
See, you know, my wife used to work for NCR, and rumors were going around that they were going to be, acquired by private equity. And when she told me that, I said, well, the very first thing they're going to do is the MBAs are going to come in and they're going to cut customer service. Yes. And guess what?

00;11;57;06 - 00;12;01;26
Craig Andrews
That's exactly what happened. And I see it again and again.

00;12;01;26 - 00;12;23;26
Craig Andrews
You know, GoDaddy, which used to be an absolutely phenomenal company. You know, they went private equity. Bob Parsons just wanted an exit out of the company. Perfectly understandable. He'd worked hard and bit by bit. The private equity guys have sucked every element of that company. That used to make me passionate about being one of their customers.

00;12;23;29 - 00;12;31;15
Christian Brim
Well, sure. I mean, I think a lot of people don't understand the private equity model, but the private equity model is to cut costs,

00;12;31;15 - 00;12;33;09
Christian Brim
and consolidate. So,

00;12;33;09 - 00;12;39;18
Christian Brim
it's it's interesting because now in the accounting space in the CPA world,

00;12;39;18 - 00;12;40;07
Christian Brim
non

00;12;40;07 - 00;12;42;00
Christian Brim
CPA owners,

00;12;42;00 - 00;12;45;22
Christian Brim
are allowed in all 50 states and it's

00;12;45;22 - 00;12;47;09
Christian Brim
brought in private equity.

00;12;47;11 - 00;13;01;28
Christian Brim
And I've sat in conversation with my colleagues and kind of mapping it out, what this is going to do to the industry, what it's going to look like. And, you know, it's exactly what happens when private equity comes into any situation is, is they're going to,

00;13;01;28 - 00;13;04;23
Christian Brim
come in and cut costs.

00;13;04;25 - 00;13;35;26
Craig Andrews
Yeah. So. How do you navigate? So one of the problems any business faces is, you know, is you have to manage expenses, you have to grow, you have to manage expenses. And it feels it feels kind of overwhelming. And and sometimes you feel like you have to take these kind of heartless activities that the, the MBAs do when they come in.

00;13;35;26 - 00;13;38;19
Craig Andrews
And, and they chop, chop, chop.

00;13;38;21 - 00;13;46;00
Christian Brim
Well, yeah. And, look, we don't get into or if you did get into business,

00;13;46;00 - 00;13;53;15
Christian Brim
for the easy questions, you made the wrong decision because there are difficult choices that we have to make.

00;13;53;15 - 00;13;56;05
Christian Brim
Like our decision to shrink.

00;13;56;05 - 00;14;04;00
Christian Brim
That was as a as an entrepreneur, the hardest thing I had to stomach because it felt like failure.

00;14;04;02 - 00;14;17;09
Christian Brim
But sometimes you do have to make those difficult decisions, and they're unpleasant. They affect people, and it's it's not fun. But to me, it's it's more around. What's your intent? So,

00;14;17;09 - 00;14;30;28
Christian Brim
when I started the business, it's kind of like you turn on a car and it's automatically idling. Well, that the automatic function of any business when you start is to grow.

00;14;31;01 - 00;14;42;13
Christian Brim
Well, that's great until you grow to a point where the complexity of the business starts to overwhelm you as a person, overwhelms your processes, your systems, your people.

00;14;42;13 - 00;14;51;19
Christian Brim
And all of a sudden, you're working harder, doing more as a company, but making less money. And, you know, the question is, why are you growing?

00;14;51;19 - 00;14;56;23
Christian Brim
And and being intentional about I want to grow to do this.

00;14;56;26 - 00;15;06;11
Christian Brim
And then those decisions become easier. You're not making them just by default or reaction.

00;15;06;13 - 00;15;12;23
Craig Andrews
Well, in coming back to what you said a few minutes ago about the role of,

00;15;12;23 - 00;15;34;22
Craig Andrews
CPA or CFO or, you know, whatever title you want to use is to help the leadership team make better decisions to achieve their goals. Yes. And one of those goals, you know, growth for the sake of growth, if I'm hearing you correctly, is probably not the best goal.

00;15;34;25 - 00;15;37;02
Christian Brim
Well, it can't be the goal.

00;15;37;02 - 00;15;51;02
Christian Brim
And it can't I mean, you know, I'd argue that it can't be the goal for any company, including the large publicly traded companies. But certainly with small businesses, it can't be the goal. The goal cannot be. I just want to grow and make more money.

00;15;51;02 - 00;15;57;15
Christian Brim
Because making money creating value for others is is,

00;15;57;15 - 00;16;00;02
Christian Brim
is the is the purpose.

00;16;00;04 - 00;16;08;12
Christian Brim
The money follows that. Right? Like if you if you don't create value for others, you're not going to make any money.

00;16;08;12 - 00;16;08;22
Christian Brim
But

00;16;08;22 - 00;16;18;19
Christian Brim
but I did and I think a lot of business owners get that backwards is I'm going to grow, and then I'll make more money. Now you need to provide more value.

00;16;18;19 - 00;16;29;08
Christian Brim
Be purposeful and how you do it and how you organize and structure the company and the money will follow, you know?

00;16;29;10 - 00;16;32;09
Craig Andrews
One of the challenges,

00;16;32;09 - 00;16;38;28
Craig Andrews
and I've, I certainly would say this is, you know, I, I hear,

00;16;38;28 - 00;16;46;26
Craig Andrews
you know, I hear jargon. And I'll give you an example of one that even though I think I understand it, it still intimidates me.

00;16;46;26 - 00;16;53;22
Craig Andrews
Is like inventory turns, you know, and I hear I hear terms like that. I know they have meaning.

00;16;53;23 - 00;17;01;06
Craig Andrews
I know they're important, but I have trouble translating what it means to me right?

00;17;01;09 - 00;17;20;02
Christian Brim
Well, I as I said, I think I think people, professionals use complicated terms for a variety of reasons. One of which is they want to display competence, right? They want to seem like they know what they're talking about and are smart. But if if you can't,

00;17;20;02 - 00;17;32;12
Christian Brim
put information in someone's hands such that they can use it, right, that it's meaningful to them and then they can act on it, and that information is worthless.

00;17;32;14 - 00;17;54;03
Craig Andrews
Yeah. So how do you do that? I mean, so that I would imagine there's a challenge because, you know, when you get your CPA, you've you've gone down a rigorous path and you've been tested with a rigorous test of can you, can you describe the finances of a business in a way that's,

00;17;54;03 - 00;17;57;19
Craig Andrews
you know, generally accepted accounting principles?

00;17;57;22 - 00;17;58;02
Craig Andrews
Oh,

00;17;58;02 - 00;17;58;09
Craig Andrews
and.

00;18;00;07 - 00;18;03;12
Christian Brim
I can't explain GAAP to anyone. So. Okay.

00;18;03;14 - 00;18;09;04
Craig Andrews
But but anyway, these are your terms. These have meaning to you.

00;18;09;04 - 00;18;24;25
Craig Andrews
And then you have most of the people in the business. They're just like, have no idea. How do you how do you purposefully make it meaningful to people or, or is it is it hopeless?

00;18;24;27 - 00;18;27;22
Christian Brim
No. I think,

00;18;27;22 - 00;18;32;21
Christian Brim
I, I get asked when, people find out that I'm,

00;18;32;21 - 00;18;48;16
Christian Brim
a CPA, they say, oh, you must really love math. And I'm like, well, the hardest math I use is arithmetic. And I learned that in second grade. So it's not really math. It's more like a language. Right? And a shorthand even, you know,

00;18;48;16 - 00;18;50;18
Christian Brim
but it's the language of business.

00;18;50;21 - 00;18;52;19
Christian Brim
And just like when you

00;18;52;19 - 00;18;56;06
Christian Brim
make a trip to a foreign country, you might have Google Translate,

00;18;56;06 - 00;19;02;06
Christian Brim
but you're going to probably commit some key words and phrases to memory so that you, you know,

00;19;02;06 - 00;19;03;26
Christian Brim
if you're not, not,

00;19;03;26 - 00;19;06;16
Christian Brim
able to communicate, you know, where the bathroom is.

00;19;06;16 - 00;19;09;28
Christian Brim
I think that a, that accounting and finance is very similar.

00;19;10;05 - 00;19;18;08
Christian Brim
I think every business owner or anybody in a business has to have some functional understanding of the numbers that, that,

00;19;18;08 - 00;19;24;13
Christian Brim
they're, they're involved with. Like, not everybody needs to understand inventory turns and a company, but,

00;19;24;13 - 00;19;28;25
Christian Brim
you know, the way the salesperson understands,

00;19;28;25 - 00;19;38;19
Christian Brim
inventory turns versus the accountant that's in charge or the, inventory clerk is in charge of managing the inventory levels.

00;19;38;21 - 00;19;39;07
Christian Brim
That

00;19;39;07 - 00;19;44;21
Christian Brim
means something very different to both of them, because they have different jobs. Right. And

00;19;44;21 - 00;19;46;19
Christian Brim
it's about using,

00;19;46;19 - 00;19;55;01
Christian Brim
accounting and finance the numbers as a communication tool.

00;19;55;03 - 00;20;07;05
Craig Andrews
So given using the example you just had, how do you how do you make these two different entities talk in a common language in a way that's meaningful and helps them achieve their goals.

00;20;07;07 - 00;20;29;21
Christian Brim
Right. So, so here, here is going on with that example. The salesperson has a very different job, different very different goals, different constraints than the the guy that's in charge of managing the inventory to a salesperson. If something's not on the shelf, they can't sell it. That's a bad thing, right? Yeah. And so they're they're never going to say we have enough inventory.

00;20;29;27 - 00;20;30;26
Christian Brim
Right.

00;20;30;26 - 00;20;40;08
Christian Brim
The inventory clerk, on the other hand, has, you know, a completely different perspective. More inventory means more work for them. Right. And so what you have is really,

00;20;40;08 - 00;21;00;29
Christian Brim
an internal conflict in the business. So friction point. Right. And and so it's not so much as is explaining inventory terms to them as it is helping them understand where each of the other is coming from and how they can work together to optimize each other.

00;21;00;29 - 00;21;29;15
Christian Brim
Like there's there's no perfect solution where both of them get what they want, that that's not possible. So it's it's it's really being able to communicate between the two of them. Yeah. There's numbers involved, but they're all wanting the same thing. And that's, that's what has to be communicated is what is our overall goal here. Our overall goal can't be just make all the sales we can and and it can't be.

00;21;29;19 - 00;21;46;23
Christian Brim
Well, we we keep inventory is as low as possible because it's a pain in the ass. It those are not the business purposes. Right. So it's about helping those individuals understand their role in the overall business objective.

00;21;46;25 - 00;21;54;06
Craig Andrews
Yeah. So I have a I have basically two questions as, as we wrap up,

00;21;54;06 - 00;22;15;13
Craig Andrews
one is the first question is when you come into a business, what is your process? What are the things that you start looking for? And kind of question behind that question is, what are the things that, you know, are most often left unattended that need the most urgent action?

00;22;15;16 - 00;22;32;10
Craig Andrews
And then the second question is for a business owner, what are three things that you would recommend that they do, whether it be have, you know, competency or take action or something like that?

00;22;32;12 - 00;22;33;28
Christian Brim
Okay.

00;22;33;28 - 00;22;54;23
Christian Brim
I think in small business and that could be a company with several million dollars. I the, the fundamental problem I see in most businesses is they don't have good accounting processes. And, I understand accounting and bookkeeping is not sexy.

00;22;54;23 - 00;22;55;20
Christian Brim
And it's not

00;22;55;20 - 00;22;58;25
Christian Brim
seen normally as a value add.

00;22;58;25 - 00;23;14;19
Christian Brim
But if you don't have good processes in place to understand your numbers timely, accurately and completely, then who you is, the owner or management, whatever is really just guessing.

00;23;14;22 - 00;23;15;11
Christian Brim
And

00;23;15;11 - 00;23;44;24
Christian Brim
I've seen so many times businesses come to me and they present with these symptoms and they think that the symptoms mean that, you know, there's something wrong with the business. But the reality in a lot of those cases is they don't have good accounting processes, they don't have good systems. And, you know, until you have those things, you really can diagnose where your problem is.

00;23;44;26 - 00;23;58;14
Craig Andrews
Okay. And so for business owners what are what are three actions that you would have them do. What. After listening this. What are three things they should go focus on.

00;23;58;16 - 00;24;02;08
Christian Brim
Well processes processes would be one.

00;24;02;08 - 00;24;09;03
Christian Brim
I don't think most business owners can do that themselves. They need to hire competent,

00;24;09;03 - 00;24;13;03
Christian Brim
external help to help implement those processes.

00;24;13;03 - 00;24;26;13
Christian Brim
It it it just consider it as an investment in the framework or structure of your business, you know, like pouring the foundation on a building. You got to have it, you know, there's just no way around it.

00;24;26;15 - 00;24;34;23
Christian Brim
And a lot of people balk at the cost and the and the time, but you can't short circuit it.

00;24;34;23 - 00;24;38;27
Christian Brim
The second thing I would do is I'd focus on your margin.

00;24;38;27 - 00;24;42;26
Christian Brim
Your gross margin. That's where the profit is in your business.

00;24;42;26 - 00;24;47;18
Christian Brim
A lot of businesses do a lot of volume, but they don't make,

00;24;47;18 - 00;24;50;06
Christian Brim
enough margin on it for the effort.

00;24;50;08 - 00;25;26;17
Christian Brim
And so I would take your gross margin, which is your your sales, less the cost related to those sales and benchmark it to you, to your numbers. Historically, benchmark it to your industry and work hard at increasing that margin, because that's that's where the profit is. And then the third would be the direct labor efficiency component, and that the direct labor efficiency is simply your your gross margin divided by your total labor costs.

00;25;26;20 - 00;25;30;23
Christian Brim
And in the vast majority of businesses, the

00;25;30;23 - 00;25;39;05
Christian Brim
easiest, most efficient way to have more money and grow your business is to manage your people right?

00;25;39;05 - 00;25;52;05
Christian Brim
If you're not, if you're in the service industry and you're not making $2 in gross profit for every dollar that you spend on labor, you're doing something wrong and focusing on the gross margin.

00;25;52;05 - 00;25;55;14
Christian Brim
And then your labor as it relates to gross margin,

00;25;55;14 - 00;26;00;15
Christian Brim
will get you 90% of the way there for for almost all businesses.

00;26;00;17 - 00;26;03;29
Craig Andrews
Wow. Well, I like that. That's very actionable.

00;26;03;29 - 00;26;18;08
Craig Andrews
We say that one more time. So for for every dollar of labor, yes, you should have $2 of gross profit. Gross profit. And just focusing on that gets you 90% there.

00;26;18;10 - 00;26;35;12
Christian Brim
Yes. Now that's for a service industry, you know. Yeah. If you've got a manufacturing business that that ratio is going to be higher. It'd probably be four or 5 to 1. But you know, you can you can figure out what your industry benchmark is and then beat it.

00;26;35;14 - 00;26;40;05
Craig Andrews
Wow. Well I love that. That's simple. That's actionable. It's clear.

00;26;40;05 - 00;26;45;04
Craig Andrews
Now you work primarily with creatives and your book again is profit first for creatives.

00;26;45;04 - 00;26;47;16
Craig Andrews
So for somebody who,

00;26;47;16 - 00;26;52;00
Craig Andrews
is listening and wants to get in contact with you, how do they reach you?

00;26;52;03 - 00;26;56;00
Christian Brim
The easiest place is just my website, Christian brimmed com.

00;26;56;00 - 00;27;01;18
Christian Brim
All my social handles are there. You can buy the book, listen to my podcast, The Profitable Creative.

00;27;01;18 - 00;27;03;11
Christian Brim
That's the easiest way.

00;27;03;13 - 00;27;04;05
Craig Andrews
Okay.

00;27;04;05 - 00;27;06;24
Craig Andrews
Where can folks get your book?

00;27;06;26 - 00;27;10;26
Christian Brim
You can get it on the website Amazon, Barnes and Noble. There's,

00;27;10;26 - 00;27;18;06
Christian Brim
audio version pretty much. Anyway, you just can't go to the library. Get it? I haven't got any leverage to buy it.

00;27;18;08 - 00;27;19;29
Craig Andrews
That's right.

00;27;19;29 - 00;27;24;19
Craig Andrews
I'm wondering how much the traditional library will continue to stand. It's,

00;27;25;03 - 00;27;28;18
Christian Brim
I love the library. I go to the library all the time.

00;27;28;20 - 00;27;33;18
Craig Andrews
I haven't been in years. Interesting. Well, Christian, this has been great.

00;27;33;18 - 00;27;36;22
Craig Andrews
Thanks for sharing these insights on leaders and legacies you have.

00;27;36;23 - 00;27;39;18
Christian Brim
Thank you for having me. Great.

00;27;39;18 - 00;28;06;14
Craig Andrews
This is Craig Andrews. I want to thank you for listening to the Leaders and Legacies podcast. We're looking for leaders to share how they're making the impact beyond themselves. If that's you, please go to Alize for me.com/guest and sign up there. If you got something out of this interview, we would love you to share this

00;28;06;14 - 00;28;08;09
Craig Andrews
episode on social media.

00;28;08;11 - 00;28;31;21
Craig Andrews
Just do a quick screenshot with your phone and text it to a friend, or posted on the socials. If you know someone who would be a great guest, tag them on social media and let them know about the show, including the hashtag leaders and legacies. I love seeing your posts and suggestions. We are regularly putting out new episodes and content to make sure you don't miss anything.

00;28;31;23 - 00;28;39;28
Craig Andrews
Please go ahead and subscribe your thumbs up! Ratings and reviews go a long way to help promote the show. It means a lot to me.

00;28;39;28 - 00;30;42;01
Craig Andrews
It means a lot to my team. If you want to know more, please go to Alize for me.com. or follow me on LinkedIn. Thanks for listening. We'll see you next time.