Adam Torres and Tina White discuss business profitability.
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Show Notes:
What does it take to make a business profitable? In this episode, Adam Torres and Tina White, Founder of Panoramic Academy, explore Panoramic Academy and how it helps businesses increase their profitability.
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About Tina White
Tina White an entrepreneur, business expert, and wildly great problem solver. She has a unique perspective based on her business experience as a CPA, investor, lender, and consultant blended with buying, operating, and selling a home services company.
Her mission is to remove the mystery of running a financially strong company by boosting your team’s business skills to match their awesome technical skills. she sees a future where every service company is profitable year-round, voted the best place to work, only receives 5-star reviews, and is not dependent on the owner. her superpower is helping service companies grow in a balanced way – people, money, and systems.
Unlike most business coaches and trainers, she runs real-world, mature businesses with employees and real expenses. she’s gone from losing money six months straight to making money year-round even during our slow season. Believe her, she wears the battle scars that can only be earned while owning a business.
About Panoramic Academy
Running a successful business requires you to make sense of the past, manage the present, and plan for the future. They help everyone in your business, from owners to employees, understand what success looks like and how they affect revenue, profit and cash flow.
Full Unedited Transcript
Hey, I’d like to welcome you to another episode of mission matters. My name is Adam Torres. And if you’d like to apply to be a guest in the show, just head on over to mission matters. com and click on be our guest to apply. All right. So today’s guest is Tina white, and she’s the founder of panoramic academy.
Tina, welcome to the show. Thank you so much for inviting me. All right, Tina. So we got a lot to talk about today. A lot of entrepreneurs, a lot of executives that watch this show. And we’re going to talk about big, the big picture of business profitability, what business doesn’t want to be more profitable, what business owner doesn’t want their business to be more profitable.
So we’re going to get into that and a whole lot more, but just to get us kicked off, we’ll start this episode the way that we start them all with what we like to call our mission matters minute. So Tina at Mission Matters, our aim is to amplify stories for entrepreneurs, executives, and experts. That’s our mission.
Tina, what mission matters to you? So we are on a mission to help business owners lead a financially strong company. That’s not dependent on them. So we actually see a future where service companies, they have a profitable business year round. They’re voted. Best places to work by their employees and their customers only give them five star reviews.
So, you know, businesses often grow by attracting more customers. Generating more sales and hiring more employees, but at the end of the day, all they have is more problems. So we really help them balance the business. So that way they can grow without. Kind of feeling like they’re driving a car with a flat tire.
So we just help them get their people, their money and their systems all together. So that way small businesses can, you know, enjoy the benefit of a balanced business. Great having you on and and love bringing on mission based individuals to share why they do what they do, how they’re doing, and really what we can all learn from each other so that we grow together.
So again, awesome having you here. And I guess, just to get us started, what, like, where did you get obsessed or when in this obsession with like business profitability and just business in general, where, where’d that come from? I have been all biz, all numbers for as long as I can remember. When I was growing up, I originally wanted to own a bank, but then there’s a lot of rules and regulations in that world and how old was that?
I’m curious, maybe a teenager. I mean, as long as I remember. I’ve just, I’ve always been drawn to games and I don’t know, it’s just like the rules and the games, all those different things. So, so when you saw, hold on. So when you saw Mary Poppins for the first time and you saw that bank scene with the kids, like that, that had a different type of effect than you, than me.
Right. Cause you’re like, Oh, I want to own the bank. And I don’t think I was thinking at that level back then. Yes. Yes. I want to, I mean the bank for sure. Go ahead, please. So after some research, I ended up landing you know, going through the accounting world and building up my financial skills started at my own business in 2010, and then I actually ended up buying an air conditioning company in 2015.
And so one of the really cool things when I owned the air conditioning company was. I was able to see the business on and help the company mature and grow, even though I don’t know how to repair it. Air conditioner. Interesting. Yeah. Don’t call me. Cause I’m, I’m, I’ll just help you with the thermostat.
That’s about as far as I can go with the conversation. And so it was, I’ve always been really drawn to. You know, my brain automatically thinks about the cost benefit analysis and all of these different things. And so my current business is really driven by the, the need that I saw, not only with my company, with, but with other clients that I’ve helped them solve these problems, I would have employees tell me, Oh, but you know, the price is a little bit too high.
It only took us five minutes. It’s only a 5 part. Right. Well, you and I both know there’s so much more to solving that customer’s problem than just that 5 part. And so I started implementing training to help the employees better understand what it costs to run the business, how to better interact and connect with the other departments.
What can you spend an extra three minutes doing that’s going to save someone else 30 minutes? And so over time, we were just able to build up those systems to really help the team become more profitable. So it is good to generate more sales, but we need systems and the right people in place and the communication where everybody understands how they impact that profitability.
So those sales are actually profitable. I want, I want to stick in the earlier years a little bit longer because this is, this is fascinating to me when somebody purchases the business and they, they didn’t have any background in it, I didn’t really understand that concept until I was pretty far along in business.
And I read the e myth and I was like, Oh, wow, I’m probably, you’re probably better off not knowing about the business. So you can come at it with it, with a, from a whole different lens. And and you can think of it objectively the way that you were. Yeah. Like when you first made that decision to take that leap into, you know, purchase that, let’s say the, the air conditioner company, like, what was that like for you that had to still, even though the numbers are on the table, like everything else, it obviously made business sense or you wouldn’t have did it, or at least you thought it did, but you don’t know until you’re in the business.
Like, what was that like? Well, you know, the purchasing process was probably pretty normal and exciting because, Hey, it’s, you know, it’s a new thing. The first six months was shocking. It doesn’t matter how good the numbers look. There’s always going to be surprises because we lost money. The first six months straight.
Lost money six months straight full as an accountant to lose money six months straight, but it was a bunch of things. There’s a lot of moving parts. We were buying new trucks, upgrading software. Some of it you planned. A lot of things were surprises. There’s a lot of employee turnover. We started the business with, well, we only had 11 of those 13, about 18 months into the process because we were just having so much turnover and, you know, some of it was by our choice. Some of it was by their choice. There was just a lot of different things that were going through the process. You know, that kind of goes through that process.
And so it took about 18 months for us to kind of see the changes that we dreamed about on the front end, but it took a while to, you know, just get everybody on the same get them on board, implement the systems, upgrade everything also while taking care of customers. Cause we bought a company that had been around since 1961.
So there was business that needed to be done while we were also making those improvements. Yeah, obviously with hindsight being 2020. And I asked this question by the way, cause there’s some people that are watching this right now that are thinking about purchasing businesses. So I’m speaking more high level than a specific action.
Like what, what would you have done? What would you have done differently? If you could obviously have the benefit of hindsight in either that acquisition or in getting into that business? Hindsight. Is really to start managing stress a whole lot better. Ooh. I didn’t know which way you were going to go with that question.
You actually didn’t go to the numbers. You went to the stress. That’s amazing. Go ahead, please. I felt really strong with the numbers and the numbers are super important, but they can only take you so far. So when you’re, when you’ve got the numbers kind of directing your path, And you’re building up your team to be able to support that staff.
You’ve got to have the ability to manage the stress because as a control freak, you cannot snap your fingers. And it just happened overnight. You can’t do that, Tina. That’s what, what are you talking? Yeah. I mean you know, when you take the leap of faith, you think you can just dream it up, control everything, and it’s going to be done in five minutes.
There’s some people in driving in their cars right now that are cracking up. They’re like, yeah, we thought the same thing. It’s it, it takes time. So you just got to learn how to, you know, really build up your leadership skills. Focus on culture first, because your first job is to take care of your people.
So your people can take care of your customers and you’ve got to be able to manage that stress while you learn how to enjoy the journey. When you think of like big business and when you think about profitability, the business overall, like, like, what does that mean to you in relation? Cause I know. I know you, we kind of juxtapose this topic with like, you know, more sales, more sales, right.
But it’s deeper than that. Like, what does that mean to you? So for me, when you think about true profitability, the, it includes every single cost that a business is exposed to. And so let’s go back just a little bit. Profitability is driven by the price that you charge, because there’s only three ways that your business generates money.
It’s loans from a bank, it’s investments from the owners, and it’s price that you charge your customer through the sales process. The first two are not sustainable long term. You’ll lose the ability to borrow money. You’ll lose the ability to go back to the investors and ask for more money. They’ll stop believing in the idea.
Yeah, so the only way to grow a sustainable business is through the price and so when you’re setting that price, it’s got to include all of the cost of doing business and regardless of the tax structure that you are, it’s got to include the owners. Salary, fair market value and benefits income taxes, and you’ve also got to learn how to consider depreciation expense.
It’s the use of that asset in your business. Then you’ve also got to think about the loan payments that’s over on your balance sheet. There’s only 1 way for the cash to come in through that price. So you’ve got to make sure that that price covers everything where you are able to sustain the business, not only for that month for long term.
So to me, all of that is considered in true profitability. And so a lot of times you have business owners where they’re like, oh, well, you know, my profitability is really high. Well, if you don’t, if you’re looking at an income statement that your tax accountant prepared based on your tax structure, it’s very likely that you don’t see a line item with the owner’s owner’s salary, income taxes, and the depreciation may or may not be the annual amount, depending on section 179.
So you might have a big profitability number. But it’s not true profitability because without you, the business doesn’t work and income taxes are a cost of doing business and it needs to be considered. So, it’s a, it’s a big, it’s a big number that has so much importance and it’s such a key number for businesses to understand the connection between price.
Profitability and then also their cashflow. Where do you find that many, I know, I mean, this is what you’re doing day in and day out is working with businesses on this topic. Like, where do you find a lot of them? When you, when you get in there, you check everything out and you’re kind of doing your analysis.
Where do, where do a lot of people go wrong? They’re, they’re very focused in on generating more sales and then also lower their income taxes. But they’ve got to understand that there’s a whole lot of money stuff going on in between those two worlds. Yeah. And then also the belief of all the money stuff belongs with the accountant.
True. There’s financial commitments being made by everyone in your company. Every single day, the supervisor approves over time. The salesperson approves a discount. The marketing department is generating leads when they don’t fully understand what your ideal customer is and what the big picture looks like.
The office manager is ordering lunch because everybody’s working overtime trying to clean up. Close out the year. Like all of those financial commitments are made long before that paperwork made it to the accountant. And so just really understanding that money and information flows in and out of the company.
You’ve got to think about it from price. Setting that right price, generating the marketing, you know, generating those leads, closing the sale, delivering that service was all of that profitable. And then actually, did you get paid? That’s one of the other things that’s really surprising to me is how much effort goes into generating leads, closing the sale, delivering that service.
But did you actually take the time to collect the money? I want you busy to generate the invoice. I’m too busy to call and collect money where you’re going to be out of business pretty quickly. If you don’t learn how to collect. What was the original idea for panoramic academy? Like where, what did that stem from?
It’s really about helping business owners. Better understand how the money flows in and out of the business. And instead of the business owner thinking that they’ve got to learn accounting, they don’t, they just need to understand that they are the financial leader. They are responsible for making sure that the company does not run out of cash.
And think about a business kind of like an airplane. So if that airplane runs and the cash is the fuel, And so if that airplane runs out of fuel, the crash is devastating to everyone on board. And so the business owner really needs to understand that they are the financial leader, not that they need to understand debits and credits.
They really need to understand that they need to bring their employees into the conversation to where the sales department understands. I want you to increase sales by 10 percent this month, but you cannot. Rely on discounts. You cannot extend payment terms. You cannot promise it this big project by tomorrow because the overtime is going to turn it into a low profitable, maybe even a breakeven project, you’ve got to teach your operations, you know, how, how much do the mistakes cost?
How much do unhappy customers cost? You know, so the panoramic just came from the idea of how do you Teaching business owners, the big picture of how it all works, but then also equipping them and their teams, how do they all understand their impact in the sales profitability and cash flow while maintaining great customer service and making sure that it’s a great place to work.
You can have it all. And the best part is you can delegate decisions to where it’s not all dependent on you as the business owner. Yeah, I don’t know how to repair an air conditioner, but I bought, operated and sold a great company. Oh my gosh, Tina. It’s a great story. And I crack up and I laugh because I’m thinking about like, so my previous business was, I was a financial advisor.
So when I even got into media and all this, like in the beginning at all, everybody wanted to talk to me about when I told him I was going into media was like, The content and the creativity and this and that. And all I was counting was how many clicks does it take to get a podcast episode out? And what’s my cost per piece of content that we put out now?
Now we’ve come a long way since those days. And now we do spend some time on obviously the formal production side of it. But if you listen to some of that early stuff, it was rough. I was like, we got to get this we got to get this pancake off the grill and on the plate already. I don’t have time for all the rest.
Oh, that’s funny. So how long has, how long has this business been around by the way? Panoramic Academy. I mean, how long have you been around? I started it in 2010. Yeah. You’ve been doing this for a while. Like that, that’s my point. So you’ve been doing this for a while. Is there anything that’s changed?
Kind of surprised you now that you’ve been through, if it’s 2010, obviously that’s post 2008 and now you, you know, you’ve seen some cycles, you saw the pandemic, like just anything that’s surprised you like along the way, whether it’s with the clients or otherwise. Probably one of the biggest things is if you struggle to make money during the peak economies, That we’ve seen over the last few years, even going back to 2008, the companies that survived those really slow times were the ones that were steady.
They were a little bit on the boring side from an operation. I like boring. Boring is good. It is. It is beautiful. When you look at financial statements and you want to have the natural ability to stretch and you want to grow and you want to see where you can take your business. But you don’t want to take your business so far that you’re almost just putting everything on black at the, you know, the roulette table, you know, like you want to make it to where when you are growing, you are being very strategic and if that idea doesn’t work, it doesn’t destroy everything that you’ve built.
Yeah, and so really, if, if you are in a great economy and you’re still not making money, there’s a major flaw in your operations. Yeah, there’s a problem because you should be making money. Yeah. Yeah. It’s interesting that you say that. And I think for. For especially for first time you know, business owners, whether they bought the, the business, they bootstrapped it, they took on investors or otherwise, it’s almost like what you just mentioned that kind of like hard knock side of things and hitting your first downfall, it’s almost like that.
That normally, or that first like big thing that happens, whether it’s the pandemic, the 2008, the tech bubble, 2002, we go back to the A’s. I mean, it’s. Always going to happen. Right. But it’s almost like if you can avoid that first, you know, real big what, what happened wipe out, so to speak, like, it’s a big deal.
And I feel like if you have the foresight to work with individuals like yourself and companies and to kind of like People have already been through this before. So if you’re like, like you mentioned, if you’re at the, if we’re at the height of the economy, everything’s going well, and you’re still not making money.
Like, what do you think is going to happen? What do you think is going to happen when things get really tricky? Like what’s your staying power going to be? And so figuring all this stuff out, like no matter where you’re at, in my opinion, like it’s important and it’s, it, the main thing is we want to make sure you can still be in the game and it’s worth your time, right?
Definitely. And you know, for the companies that are starting out, when I bought the business. The air conditioning company. I jumped off on the D in the deep end, but it is very different. Then I was, that’s why I say, Ooh, that’s scary. And you don’t know. Yeah, it’s different. And it’s different than even with panoramic academy, cause I’ve been building it from scratch since 2010.
And so one of the biggest misconceptions for the people that are thinking about starting a business, or maybe you recently did is if we go back to that book, e myth. We are all naturally starting as the technician role. And when I say technician the author defines that as anyone that’s doing the work, you go to work, you put your head down and you actually do the work.
So you are either the plumber, the air conditioning technician. Or you’re the lawyer. You’re the one that’s actually the podcast host. No, doing it, but you’ve got to understand that it’s a very different skillset than actually being that entrepreneur. And so when we come to the table with our natural bias, from that technical standpoint, we usually fall into the world of doing the work in that phase of operations and delivering that service.
And you’ve got to understand that you need time, money, and energy to finish that entire business cycle. You’ve got strategic planning, you’ve got to attract the customers with your marketing. You’ve got to learn how to sell. I’m speaking to myself with that one. You’ve got to deliver the service and then you’ve got to take the time to consider the administrative side, the insurance, the accounting, you know, and your budgets, all of that type of thing.
And so you cannot think that you can just. Focus everything in what you naturally are drawn to. Mm-Hmm. for 40 hours a week and run a business. No, you’re probably gonna need to spend a lot more time because you are now the entrepreneur and you wear all the hats. Yeah. And you either need to charge a price high enough to where you can afford to pay other people, or for a little while you’re gonna be, you know, just kind of bootstrapping the business.
And you’ve got to learn enough. And just like what you said the early days of your podcast. You focused on the bare minimum that you need to do. I was focusing on clicks. How many clicks to put out an episode? I swear I used to count them and I was like, that’s what, and, and speed to delivery. Nobody else was thinking like that.
I was thinking like a financial advisor. I’m like, and that’s why, you know, eight years later we put out over a hundred thousand pieces of content. And no, there’s, we’re not, we’re not iHeartRadio. We don’t have 4, 000 employees. So we’re, you know, we’re, we’re punching above our weight based on the systems that were built on the back end though, even in the early days.
And that’s a great point. You focused on shipping the product. Yeah. You didn’t get the pancakes on the plate. I’m telling you, Tina, I guess episode on the plate. And you learn and you learn through, you know, a lot of, a lot of the. You know, people clicked on this, but not this, you know, you learned through the process and, you know, a lot of business owners, they can kind of get stuck in the idea phase, but you gave a great example of, Hey, let’s get the minimum viable product out there and let the audience, the, you know, everybody tell us what we need to do to make it better next time.
Yeah. And that’s a big learning lesson for a lot of people starting out. Don’t get stuck in your head. Let the market tell you what you should do next. Amazing. Well, Tina, I, first off, it’s been great having you on the show. I just, I just have to ask what’s next. I mean, what’s next for you. What’s next for panoramic Academy.
What’s your vision. So I really enjoy providing business classes. I’ve, you know, I have some classes that online that are available at Self paced, but I really look at 2024 as more of a live in person type of opportunity because I think we all miss the, the extra nuances that you can get from live in person classes for this year.
Amazing. And if somebody wants to, wants to connect and learn more or continue the conversation, how, how do they do that? They can go to panoramicacademy. com slash grow. And that is a great place for them to find curated information to kind of help them continue in this conversation. Fantastic. And for everybody watching, we’ll put that information into the into the show notes, so you can just click on the links and head right on over.
And speaking of the audience, if this is your first time with mission matters or listening to an episode, we’re all about bringing on business owners, entrepreneurs, and executives on the show, having them share their mission. Like what makes them tick? This is a daily show. We have many more interviews coming up and amazing entrepreneurs.
Just like Tina. If that sounds interesting to you, Hey, hit that subscribe button. We don’t want you to miss any of those episodes. Again, this is a daily show, so hit that subscribe. And if you’re a long term listener or viewer, and you have not yet left a review, come on, you know what to do. Hit the review button.
And Tina, thank you so much for coming on. It’s been so much fun and I appreciate you coming up. Thank you so much. I enjoyed it.